Wasted on Me

I was up for no really good reason at about 4 AM, particularly since I don’t consider Laszlo the Dog’s barking at a phantom menace to be a good reason.

Probably more out of instinct than anything else I pulled up the Bloomberg Mobile app on my phone while waiting for Laszlo to protect us from the blowing leaves and saw that the US Futures Market was reasonably flat and the Asian markets were doing nothing special.

I went back to bed neither excited nor dreading the open, expecting yet another quiet day. Maybe the kind of day that I could find the time to complete my furniture repositioning tasks left over from the past two days.

Well, for the very same reasons that it’s hard to justify sneaking away to attend to personal hygiene needs, a lot can happen on the international scene.

China decided to loosen up its banks’ reserve requirements.

That apparently is a good thing as far as liquidity goes. Although Chinese companies may not like to abide by standard accounting principles, it does seem that basic economic laws apply, even in the People’s Republic.

Ben Bernanke - Mythical LumberjackAs if that wouldn’t have been enough, the European Central Bank and our own Federal Reserve decided to coordinate action to allow foreign banks to access US dollars at lower cost.

What those ECB guys didn’t realize was that those American Airline Frequent Flier miles that were thrown in to clinch the deal were going to be close to worthless.

Score another one for “The Bernank.”

It was hard, though, to hear all of the cheering from the trading pits, what with the sound of Bernanke led chainsaws felling forests worth of lumber destined for the Treasury’s printing presses.

I like Bernanke and think that his calm guidance likely rescued us from the kind of economic travesty that our generation could not possibly endure.

Besides, tell me that Bernanke doesn’t look like a highly stylized and mythical lumberjack.

As it would turn out this would be one of those rare market days when there was no real attempt to sell into strength. The green just kept getting more green.

To my shock, I never once heard anyone refer to the nearly 500 point gain as resulting from “shorts covering their positions,” although with two minutes left to go until the final bell, Bob Pisani of CNBC commented on the light volume.

Of course that’s come to be expected, but what was a bit different was that Maria Bartiromo who made precisely the same observation on Monday, chided Pisani for his Grinch-like assessment.

Ha Ha.

As great as today was, after all what’s not to like about a bonus 500 points? But it was wasted on me, much like a box of fine wine.

I’m still a Manischewitz kind of guy.

Things being wasted on me has been a theme the past couple of days, although it hasn’t always proven to be accurate.

This past Thursday, for example, my kids had 3 tickets to the Ravens and 49ers football game. Since I’m not a huge football fan, I asked my kids if they didn’t want to take one of their friends instead, since my level of appreciation was likely low when compared to your usual football louts.

I really thought that those tickets were wasted on me.

But hearing what every parent would love to hear, they said they wanted to go with me to the game. The fact that it was unseasonably warm for a Thanksgiving evening gave me no real out, but as it turned out, not one bit of it was wasted.

We had a great time and it was a wonderful game and evening, although I still can’t remember why I have some biker chick’s name tattooed on my neck. The kids said I did it as a dare after downing a bottle of whipped cream Vodka.

Whatever. So I guess they’ll just have to bury me in the thieves and unholy section of the Jewish Cemetery.

Well rested and prepared for a nice trading day on Monday, I was noticing a steady stream of Tweets directed to me from a number of different people, each of whom had more followers than the typical spammer.

What made these Tweets interesting was that they believed that I had any clue of wnat they were talking about:

I may make about 1500 trades a year, but I have absolutely no ability or desire to engage in “Chart speak.” I see colors and occasionally dead people and have never hidden that fact.

Look, I’ve owned shares of Riverbed Technology for the better part of 4 years and still have no idea what they actually do.

Don’t really care.

“$GOOG Bullish Tri Star Candlestick Pattern…” I know Google, but the rest?

What the hell does that mean?

$SLM CCI is bullish” Again. Sallie Mae and I? Old friends, but what’s that you say?

Again, no clue.

And there were more from where those come from.

There’s also a very nice person who follows me on Twitter who is extremely polite and thoughtful. If I retweet one of his tweets or a link to his page, he sends me a “Thank You” direct message. Not the Anthony Weiner kind, but one that sincere and grateful. He also very graciously retweeted one of mine yesterday alerting readers of the migration of Szelhamos.com to its new home at TheAcsMan.com

Very nice. Right?

I’ve looked at his blog site, Chartsmarts, and he is clearly far more serious, organized, analytical and capable than am I.

If we went back about 10 years or so, I might be able to understand, or at least have the interest in understanding his passion and output.

I was never a very good one to actually pay attention and never really did well by listening or reading as a proxy for learning. I tended to be the sort that had to deconstruct things to be able to learn them. On rare occasion I’d actually successfully reconstruct what I’d demolished in the name of knowledge.

I still do that, but the problem is that I’m no longer able to retain what I’ve learned in my short term memory banks, so I do lots of deconstructing, but then lose interest in the reconstruction phase of the process.

A few years ago, realizing that to be the case and really wanting to learn PHP and MySQL (don’t ask me to explain), I actually bought one of the “…..for Idiots” books.

After a couple of chapters I threw in the towel.

I wish I had Chartsmarts’ skill, drive and good will. I follow very few people on Twitter. He’s one. Even though it’s wasted on me, there’s no reason for it to be wasted on you, so follow Douglas Busch

Now, what was really wasted on me was the last 500 points.

To some degree, that’s an exaggeration, but my holdings have underperformed the markets through these last 800 Dow points. 

While the S&P 500 has gone up 7.6% this week, I’m only up 6.6%. That still leaves me in the 1% group, so you needn’t worry.

Most of that, actually all of it and then some, is due to the marked underperformance of the ProShares UltraSilver the past 5 trading sessions or so, as silver has kept rising. In fact, today I was able to buy back all of the call positions that I’d sold this month in anticipation of another drop in silver prices and a rise in the leveraged short ETF.

Some of those marked the second such closing trade, so I’m not moaning about the past few trading sessions’ performance.

But as this 500 point surge came out of nowhere, I’ve been caught a little flat footed, having hedged about half of my existing positions and either already at prices close to their strikes or now comfortably in the money.

Did you foresee a $7 rise in Caterpillar today?

Me neither. My risk/reward on this most recent round of call writing on Caterpillar is nothing to write home about, but still, profit is profit.

Although Caterpillar has been very nice to me, especially due to having sold weekly options on a regular basis, today’s rise puts it will above my $92.50 strike at which shares will be assigned. Green Mountain Coffee Roasters, Visa and Halliburton may share the same fate after today’s surge.

What wasn’t lost on me was comparing the chorus cries of Monday’s “Dead Cat Bounce” to the same talking heads warning of a melt upward going forward.

Once again, as the chorus cries get louder, just this time in a different direction, it’s time to look back to the other and original direction.

The history of government intervention is often measured in days, as reflected by the equity markets, so I can’t get too excited about what it will bring us tomorrow or the day after.

Although I don’t see the melt up quite yet, hopefully today’s bold moves won’t be wasted, at least not on my account.

Maybe then, once we get all of these banking disaster stories out of the way, we can get back to our old habit of bouncing from one fundamentals report to the next and then conveniently forgetting yesterday’s earth shattering report to make way for today’s Andy Warhol like data release.

It’s been a shame wasting those.

I miss the old days.