A Heaping Steaming Pile of PANIC! What's My GamePlan

  • Posted by
  • on October 26th, 2008

I have been accused lately of being negative.

I wrote a post a few weeks back saying panic is a virus. Sequoia was jumping on it. George Bush jumped on it. You can’t blame ‘Joe the Plumber’ for panicking. Here is what panic looks like .

One look at this chart and thank goodness I have been negative. It has saved and added to my returns this year. That said, I do agree about my attitude and I hate writing angry missives so will stop. There are some fantastic bloggers that already do that.

The title of this blog is ‘Trends – Find Them, Ride Them, and Get Off – Stocks, Venture and Civilization’

For the most part, my fund ‘Got Off’ in the January meltdown. That meltdown is a teeeny blip compared to the September and October crash. Since than I have been short on ideas, long on protection, cash and small investments. I don’t think riding the panic trend is a great investment. It has been ‘THE’ trade of the century though and I was not smart ‘ballsy’ enough to profit from it.

I have been spending the last 3 weeks managing the panic, making some dumb buys, some great trades, some momentum shorts and now basically watching in horror as we break all the rules in this decline.

I truly have no idea when the crash will end, but it is leaving no stock or sector uncrashed. It just seems smart at this point to be fading the rallies to continue to bring down the average costs in my longs. The reason I want/need to be in front of my screen is so my short trades can be lifted in a strong rally. There will be many.

My GamePlan is the same. I cut out all travel a few weeks ago because I knew we were in something big. I am set to travel to Chicago Tuesday after the market for the night, but otherwise, I want to be around my screen and Stocktwits, monitoring the flow.

No big bets yet because “Joe The Plumber’ is still in denial about the losses in his 401k and regular mutual funds. Little do they understand that the 60 percent drop in their Fidelity Magellan mutual funds will take gains of 150 percent to make them whole. That could be 10-20 years.

My attitude is to try and stay light enough so that I end up with the right stocks and amounts invested to make my next three years. That’s why it is worth me actively managing right now, something I have not had to do in years.

While indexes seem to have crashed, individual stocks have made the indexes look bullish. Most small caps are down 60-80 percent very fast. I am not sure if the indexes play catch up or viceversa, but something is going to give.

The madness ends when grown men start doing business again. Prices WILL get to the point where people just say ‘FUCK THE HEADLINES’, that’s just worth owning.

Few are saying that these days.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

blog comments powered by Disqus