This is an oldie but my favorite and most right on Naked Putz:
The weak dollar is not the longest running trend that has stayed intact since I started this blog. It has been extremely good to me, but the world is downright pissed about it.
When bankers continue to print stock, be it Telecom, or Homebuilders, you get a crash. Well, the governement has been inflating forever here in the US for a myriad of reasons. The biggest reason is that we are crybabies in the US and can’t stomach another Crash. With the Euro’s close near $1.50, I am very concerned about a panic. I can’t get myself to own a currency of that god forsaken land mass. I will stick with Canadian dollars and hard assets. Working fine thank-you.
Until we get serious policy change here in the US, the trend could just accelerate. Or not .
The way the dollar acts seems climactic in nature and that is why I am fearing a market event. Too many recent breakouts in my portfolio have reversed fast and turned negative – SINA, NDAQ, CSTR, BBBB and many all-time highs I never added. I don’t have a complicated system of stock selection or money management, but the vicious price action speaks loudly. It has my full attention.
I am building a list in case this week gets messy. You should too.
So it turns out November is the bad month for stocks. It really has nothing to do with the calendar. It’s bullshit financial stocks that have been endlessly rolled up in a perfect interest rate scenario that still managed to blow trhemselves up with greed and bullshit accounting. Than there is the continued bludgeoning of the dollar’s, which is fun to watch being long Gold and Canada, but it’s inability to rally is creating full fledged panic. It could actually trigger a massive sell-off here. Few win on this scenario.
It’s a little chilly in New York, but it’s a beautiful day to be walking the streets. Too bad I have been couped up in meetings.
I bought some Garmin under $90. It looks like Bam Bam (Tom Tom really) has increased their bid for Tele-Atlas. If Garmin keeps upping the number, the stock will fall further, but I have sold stock so much higher and love GPS stocks, so will take a small piece back in.
I also bought some CYNO (Cynosure). It’s down 20 percent from all-tuime highs but growing like a weed. I am long tattoo removal and other bullshit laser surgeries.
Other than that, the whoopass on financials continue. BX and Goldman are far from my kill zones and American Express is appealing to me 20 percent lower so I watch. Other than that, it’s skeleton in the closet time. Today, Capital One is the punished. I hate those weasels so I could care less. Mastercard is a monster so if you are playing the short game, they could play catch-up. Not for me.
The market can’t move strongly higher without them. Period. You should just do less.
I am sure the Apple store is packed though .
Disclosure – Long AAPL, Gold stocks, GRMN< CYNO and Canada
So the Canadian dollar has shot WAYYYY past par this week to $1.03 plus cents. It has careened out of control now that it has entered ‘no man’s land’ which has been well documented as a trend on this blog.
It is fun to be right and catch a trend. This one has seemed too easy, but if you print something as fast as we have printed US Dollars, it is not possible that it will hold value over time.
That time is now. I talk enough to Canadian businesses owners and concerns are at Code Red.
If you are a Canadian or European not in super luxury exporting, you are fu@#cked this year. Even if you hedged the last 20 percent fast US dollar move, as a Canadian or European exporter what do you do this year when you can’t compete? If I am a US importer collecting bids in US Dollars, I could give a crap about your currency issues. I want the best price. You are going to have thousands of businesses missing their numbers this year. Now don’t get me wrong. There are thousands of businesses that will surface over time from this currency swing and places like Calgary (that’s Canada ) have been booming as oil booms, but major shocks and surprises come from huge moves like this as businesses do not adjust fast enough and the stock market hates surprises.
We had the first market warning shot this August with our credit crunch. The market has behaved awesome shrugging it off and chugging to more all-time highs. BUT, tops take time to form, lot’s of time. I am not close to price stops on my stocks so I may be facing a large drawdown if we get a trickle down.
Trade Wars scare me the most. I can’t imagine this scares George Jr. based on his rhetoric of war and enemies.
Time will tell.
Other things remain perfectly in balance. The Phoenix Suns are running and gunning, the Arizona Cardinals are back losing and I am headed back outside now as it’s 80 degrees and perfect in Phoenix. That’s now 82 in Canadian degrees . I am worried about this heat exchange come next summer.
Billions, likely trillions of profits are being made and lost.
You can slap all the fundamental and technical analysis on this trend that you want, but it’s quite simple. If you print ANYTHING non-stop, it loses value. Dollars, Lithographs, Rocky movies…
Back just in July I tried to exchange a Canadian $20 to get uptown to a meeting. No dice. Today that dollar is worth 2 cents more than a US Dollar, which is a gigantic 7 percent move in the exchange. Here is the Canadian/US dollar chart and ETF (symbol-FXC).
Here’s the drama as it unfolded:
That raspberry salesman made out like a seasoned currency trader .
If someone tells you what this means – THEY ARE LYING. That’s what no man’s land is.
The noise alays gets louder at inflection points. That’s when you should do less.
One thing I would be sure of, the banks, like Cramer, THINK they know what no man’s land promises. That’s why I would turn off the TV and avoid the financials. Cramer screamed fire on CNBC last Friday on the homebuilders and the FED. Since that fit, the Dow has rallied 600 points and the homebuilders have rallied 30-40 percent in a few days.
Just keep doing less until the market shows it’s real strength again.
Too many unrecovered stocks in my portfolio after this big rally to make me think this rally is real.
Also took my loss in the stupid homebuilder trade. Much smaller than it could have been if I had sold into Cramer’s we are going to zero panic.
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