I’ve decided that I will be sitting on the sidelines while the latest in Clam “watch me control inflation like a boss” magic to reduce inflation has begun – via raising margins on commodities to infinity. It is quite possible we’re entering what some have dubbed the “deflationary vortex”. Personally I thought any vortex would be caused by demand destruction, not orchestrated by the CME (aka Clam Puppet). If anything is over priced for Americans it’s simple, raise the cost of speculation. I won’t deny that it is simply a brilliant move by the clam. As well, we all know interest rates are the normal way to control inflation, but you can’t when your government is only supported by the printing press and interest rates raise your debt payments (which are unsustainable).
Needless to say I’m done with stocks that are linked with commodities, which is just upsetting. Calls on $SLW $ABX $SLV $GLD have been a large part of my trading platform since December. Also, I hold a number of small cap Canadian miners in my long-term holdings – but this is just another opportunity to buy more. I booked a loss on $HAL – Halliburton today, nothing major, but I didn’t like the way it blew through its 50day avg – nor how crude futures are trading. By the time I was able to check my portfolio at work, CME decided to hike margins on everything from gasoline to crude to crack spreads. Soon they will be hiking the margins on eggs if they become overpriced. I will also be closing a massive loss in $WNR – well not a loss YTD, but all the profits I booked since November. This is where some of my CME anger resonates – as the crude, crack spreads, and gasoline margin hikes today sent $WNR into a tailspin down 8%, more aftermarket. Its ridiculous at this point that I need mass flooding from the Mississippi and maybe even a Gulf hurricane – leaving $WNR as the king of gasoline. Crack spreads have rebounded tonight pushing them back over $30.
So this leaves me with the ability to trade in Technology, Finance, or Pharms – which I fucking hate to trade. Essentially, they (Fed, Bernanke) are pushing little money out of the market so Bernanke and all of unregulated bank buddies can monopolize the entire market for the benefit of America (the 7% that are unbelievably rich, but have more money than everyone else in America).
I will be scanning for companies that have good setups in Technology, as the Nasdaq seems somewhat more resilient than the Dow, S&P, or Russell. In fact I shorted the Russell today via $TZA. Extremely small hedge position.
Long $WNR, Short small caps via $TZA (very small OTM calls) as a hedge/speculation/bet against the clam. 90% cash.
Also as I posted yesterday, we saw huge pullbacks in $MCP and $AVL. $AVL tested its breakout and could be both here or wait for further weakness. However, $MCP is up after hours, so maybe Rares will catch a bounce tomorrow. I’m still looking to enter, but predominantly sitting in cash. Canadian dollars so it’s appreciating – for now. $AAPL looks intriguing, notes on $AVL’s chart too – although today’s selling was comparatively high volume to normal days.
The only thing consoling after a shitty day: