Get Ready for Dow 6,000

The Dow has tumbled 20% this week, 30% in the last month, and 42% over the last year. This is a full-blown crash -- the worst since 1929. 1987 was the equivalent of eating bad sushi compared to this. But wait! It can worse -- a lot worse. I'm not saying it will, and I certainly hope to God it doesn't, but the chart says we're on our way to 6,000 on the Dow. There is an uptrend line on the Dow that begins in mid-1982 and runs until about 1995 -- this trend line represents a 6% compound annual return. There is another, much steeper trend line running from 1995 to 2008 -- this line represents a 12% compound annual return. It was also completely shattered this week. Annihilated. A technical analyst would look at this chart and predict a high degree of probability that the Dow is headed back to test the 6% trend line, which comes in at roughly 6,000. We had all better hope to God that the 2002 lows at 7,000-ish hold. We had all better also hope that B. Hussein Obama is not elected, because that will make 6,000 a virtual certainty.

AIG can eat my ASS

You have got to be fucking kidding me!!! Days after the Gov. bailout these fucking mutts are out blowing $400K+ to reward their top employees? Fuck man, I want to work at AIG--or at least I would have liked to--nothing like some good government outrage to stem the flow of cash for fun and games.

Here is the link to the actual bill from the St. Regis to AIG. It is fucking outrageous!!

http://oversight.house.gov/documents/20081007102513.pdf

I say, have those fucking assholes who went on the retreat be on the hook to repay the balance. Do/did they have no conscience? Were they unaware that AIG almost went belly up? Fuck this shit of using taxpayer money to have a good time. Your good time is over boys...now pony up, MOTHERFUCKERS!

A Plethora of Black Swans

The origins of the term black swan go back to the ancient Western belief that "all swans are white". In that context, a "black swan" was a metaphor for something that could not exist. The 17th Century discovery of black swans in Australia metamorphosed the term to connote a perceived impossibility that actually can come to pass. That said, we at The Angry Trader have decided to compile a list of the black swans that have materialized from the ether of the current economic and political shit show:

1. Dow 8,000. Two weeks ago, Dow 10,000 was considered an overly aggressive Bear target.
2. S&P below 1,000. Ditto.
3. First radical Marxist about to win the White House. Barack Hussein Obama is a glib, cocky, arrogant, radical socialist who could not possibly be more unqualified for the Presidency. He has spewed a smokescreen of mellifluous rhetoric over tens of millions of lemmings who think the term "Realpolitik" refers to a brand of shitty Russian vodka.
4. R.I.P: Bear Stearns, Lehman Brothers, WaMu, Wachovia, IndyMac, Countrywide, Dexia, Fortis and, now that the Marxists about about to gain total control over our government, American capitalism.
5. West Texas Intermediate Crude Oil below $80. Congrats to all you tree-hugging hippies that paid-up to buy a Toyota Prius. Next time read a fucking book about the laws of supply and demand first.  Hint:  go to the chapter on "elasticity"...
6. Australian Dollar falls 30 big figures in less than three months. For those of you who aren't familiar with FX, a 40% move in a major currency does not happen. It is a 10 standard deviation event, which means it's only supposed to happen once every 10,000 years or so. Let this be a lesson to all of us vis-a-vis what happens when any asset is egregiously overowned.
7. VIX above 70. It only hit 50 right after 9/11, go figure. Apparently subprime loans are scarier than a bunch of fascist rag heads flying planes into the Twin Towers.
8. Media succeeds in convincing large portions of the populace that Bush/Republicans, not Carter/Clinton/Frank/Dodd/Democrats and their idiotic social engineering experiments, are responsible for the collapse in our financial system. I mean, we knew the public was stupid and we certainly knew that the media stopped even pretending to be unbiased decades ago, but this one takes the cake. Well done, media, you have made 2008 the year that journalism officially died.
9. Oliver Stone makes a movie critical of a Republican President. Oh, wait, that doesn't go on the 'Black Swan" list, it goes on the "Things That Could Not Possibly Have Been More Fucking Predictable" list.
10. California goes bankrupt. Oops, that goes on the other list as well...

THE END or the end?

So we reached and broke through 8300 today, have traded around that number for a good while now....so now what? I frankly am not willing to call a bottom today.

I did have the opportunity to speak to some relatively senior people at some long only funds today, basically trying to see if there was any "plan" at these shops in terms of lines in the sand to buy etc....

Unfortunately, I did not get any answers that gave me the slightest twinge of the warm and fuzzies. Quote of the day came from one PM, "we don't have a plan in place. We have nothing."

That is fucking scary....these are the guys who have been on the sidelines and are supposed to stabilize the tape with their inflows of cash on the sideline. Apparently, the redemption side of e that equation continues to win the daily battle. With that, I will put my neck on the line and say if by next Tuesday we do not have an additional major leg down, we are fucked for the rest of the year--and well into 09! A rally will cause short covering and prevent the "purge." However, if we can really purge between now and Tuesday's close....we will have put a bottom in place, at least in the n/t. That would mean at least an 800 point rally in the Dow, in my estimation.

We shall see...and in the mean time, go get some kevlar, a helmet, new seat belt and a load of cash...these are some strange days indeed.

Fuck This Shit

So the news is that monkey Dana Perrino is out saying that Treasury could buy equity stakes in investment banks?

What the hell is this socialist bullshit? Why the hell can't the government buy an equity stake in the pharma company I own? Or GE?

Obviously, I didn't have a great day in the market, though the pain was mitigated by my high cash position and my automotive short. Still, I did short puts on a financial (oh I'm in it for the long run like all the dumb value investors on CNBC) this morning and while it's a tiny position, it will hurt.

BARAK AND MCCAIN CAN BOTH SUCK MY COCK

So as our financial market and the globe continues to melt into oblivion, I thought last night's Presidential debate might actually have some meaning, some substance, with insight and a fucking plan!!! Boy was I wrong--It had none of the above.

What it did have and highlight was that NEITHER CANDIDATE SHOULD BE PRESIDENT! Neither man came prepared, neither man was on his game, neither man showed passion. How fucking hard is it for either of these fucking losers to put on a fucking Ross Perot type presentation and highlight the following:

1. Cost savings to the average Joe(Joe 6 pack, Sarah Palin) over the next 5, 10 and 20 years as we rapidly move to alternative energy and fuels.

2. Cost at the pump over the same time frame as we reduce our dependence on foreign oil.

3. Number of new jobs created to build out the infrastructure.

4. Locations around the Country where alt. energy programs will take place--and what that will do to unemployment rates, and housing prices in that region.

This country is so fucked in terms of infrastructure--how fucking hard is it to put a speech together in the fashion of other great leaders (Reagan/Kennedy come to mind) wherein you articulate a fucking PLAN?? Here is where we are and these are the ramification. Here is where we will be in 5 years, 10 years and 20 years--IT IS CALLED INSPIRING THE NATION TO MOVE TO THE NEXT LEVEL!!!

The only part of the debate worth revisiting last night, in my humble opinion was the question asked by a woman who is clearly having here home foreclosed on and her cars were repo'd yesterday--"why should we trust you when both parties are at fault for the financial mess?"--that question was not answered by either candidate.

Listen--I am no fucking rocket scientist, but I do know neither of these mutts is ready to lead. Neither of these mutts is "Prime Time".

It is a pathetic statement that this is our best. Please. You have got to be fucking kidding me.

Michael Bloomberg........HELP!!!!!!!

--The Angry Trader.

Jamie Lynn Pregnant Again??

TheEnquire is reporting that the dumber of the Spears girls is pregnant again...and apparantly she got pregnat believing that you cannot conceive while breast feeding. I am NOT making this up. See: http://www.wwtdd.com/post.phtml?pk=13171 for clarification.

If this is true....it could signal the end of the world. Screw the global stock market meltdown, screw the credit markets tighter than a virgin....this would be HUGE NEWS. It really would signal the end of the world--who the fuck gets pregnant for the reason she did? What moron gets pregnant within a month of her first puppy being squeezed out, and who has two kids when they are famous and under the age of 18??...and who thinks you cannot get pregnant while you are breast feeding???? Jamie Lynn--You have got to be fucking kidding me!!!!!!


Jamie--What the fuck is wrong with you? What the fuck is wrong with your parents (who by the way I nominated for parent's of the year in 2007(see http://www.theangrytrader.blog.com/) on the first iteration of The Angry Trader.

I have heard of not getting pregnant when having sex on your feet, or on your hands and knees...but never when you are breast feeding. Simply amazing how stupid people can be. I guess that is what you get when you grow up in a trailor park, have an IQ less than a can of corn and your parents are only out for your money....

--The Angry Trader

Like I said...Confidence Sucks, I LOVE IT

GET SHORTY, LOSE YOUR ASS TODAY:


It's unfair. Do people even realize we have stocks trading at 2x forward numbers that are growing 50%? So basically investors don't believe in the numbers. Fine. I buy that. So lets say 50% is 25% instead. TWO TIMES FORWARD NUMBERS???

As Phil Leotardo said, cooler heads must prevail here. Monetary base has and will keep expanding, but confidence is terrible. Good thing about confidence: it changes. Banks need to lend the money that has been added to the system, and when that happens we are going to have one of the biggest rallies anyone on this planet has lived through, dot-com days not-withstanding of course.

I'm not Mr. Bullish. I've been Mr. Bearish for the better part of the last 14 months (Aug 07.) But now we are getting close to so many things happening that will take us higher. Meanwhile, people are salivating for the short ban to come off tonight to get short. What happens when they all lean the wrong way at the same time? KABOOM, melt-up.

Not saying its gonna happen today, or tomorrow, or that Dow 7K is out of the question. But I am saying I remember in 2002 when Bill Gross started calling for Down 6,000 and we thought CEO's were all crooked and SarBox sign-offs would highlight this and we knew CSCO could never have another good quarter. What happened 3 months later? Cisco was up 50% without reporting a single good quarter. And the braniacs couldn't figure out why.

Here is why: SUPPLY AND DEMAND. Once we get through this supply digestion and the confidence brings back demand (and by the way, confidence, which remained positive through 80% of this 14 month sell off, does turn on a dime and usually just in time to exponentially accelerate a move in either direction, will show up late to the up move and squeeze mcshorty even more) and corporate buybacks kick in and take yet more supply out of the market, you get a market that goes higher, quickly.

Rate Cuts = Epic Fail So Far

Fuck, I've been getting more bullish but this morning is looking ugly. Maybe George W. Bush can get us excited with a "Go Shopping!" type of motivational speech.

Ben B Reads The Blog

I don't have much time, so I will be brief.

For those living under a rock, McLovin was getting worried about Ben B's dereliction of duty. We were begging for a rate cut, but finally Ben clicked on the now infamous angrytrader link and realized the err of his ways.

Welcome to the game, Benji (is Vinny Chase gonna play Benji, or what?)

On to more pressing issues. We are opening up the blog to outside contributors who can submit articles through our Craigslist advertisement for consideration.

Unlike the real-world, we have the following requirements:
--you don't conform to conventional thinking
--you prefer to curse than sound polite
--you've never met an issue you didn't disagree with

Be advised, if you submit an article that doesn't conform to the above requirements, we will probably post it just for the sake of demonstrating why we hate people like you. THAT's WHAT BEING ANGRY IS ALL ABOUT!

Oh You Exporters About to be Fucked...

Oh Lordy Lord Netgear is going down like the frigging Hindenburg this morning. Entry from Briefing:

"Based based on preliminary data available at this time, net revenue for the third quarter ended September 28, 2008 is expected to be in the range of $173-$183 mln (consensus is $210 mln), down from previous range of $208-$212 mln. The co expects non-GAAP operating margin to be in the range of 10.3% to 11.3% versus the company's previous expectation of approximately 9.5% to 10.5%. Additionally the company expects to report other expense in the range of $4.5 million to $5.5 million in relation to losses on transactions denominated in foreign currencies. "We experienced weakness in September demand on our consumer products across all channels and in all geographies, particularly in the service provider channel, where our carrier customers worldwide requested shipment delays on previously placed orders, thereby preventing us from recognizing revenue on those orders."

Now I want you to play close attention to the "Additionally the company expects to report other expense in the range of $4.5 million to $5.5 million in relation to losses on transactions denominated in foreign currencies."

Foreign currency translation is going to fuck over a lot of exporters during Q3 season. Are you paying attention shareholders of shit like IBM and CAT and HPQ?

FUCK YOU FULD!

Hey Dick--You have got to be fucking kidding me...I mean your rediculous commentary yesterday is one of the best examples of why I have this blog:

You disgraced your firm, disgraced the Street, ruined how many lives?...... and you have the audacity to make the following comment:

"{I will}...wonder until they put me in the ground, why the U.S. government did not rescue {Lehman} with regulators knowing the full scale of its condition well before its collapse." Jesus Fucking Christ. You probably should have called the Pope, Dickey as he would have told you that the only thing you can rely on today is God. (See yesterday's rant). You really are a disgrace, Dick Fuld.

Let's get this straight--you just thought the government would bail you out? Nice job dude. Really---you are the type of CEO I want running my company. I guess you were smoking the same grass as the exec's over at Bear when you came to the conclusion that the government would be your backstop. You really are a disgrace, Dick Fuld.

This beligerent retard said,"I do not know why we were the only one" that was not rescued. That is PRICELESS!! I guess I should point out because you apparently were living in a tower of your castle, but BEAR STERNS went away too, jackass...You really are a disgrace, Dick Fuld. Oh--Dick, one more thing, how much did YOU walk away with? And over the past 15 months???

So in summary, I often comment that working on the street, buy or sellside--is like Darwinism every day...survival of the fittest at it's best.--Only the strongest and best survive. It is not that hard of a concept and it is incredible to me that a CEO of a major firm could not realize this every moment of his tenure at the top. Somehow I do not believe Darwin was looking for government intervention to keep evolution from happening.


On behalf of all my friends over at Barclay's now, GO FUCK YOURSELF DICKEY FULD!!!

---The Angry Trader

George W. Bush Discusses Credit Crunch

If you're not watching this on live TV, I'll give you a summary of George W. Bush's explanation of the credit crunch:

"One fella wants to buy a desk and another fella's gotta lend him the money but he don't want to so the first fella can't buy the desk."

Vladimir Putin Kicks George Bush's Ass in Macho Macho Man Competition

We all know Connecticut native George W. Bush likes to pretend that he's a tough guy. He talks like he's the one on the front lines in Iraq and likes to dress up as a cowboy or spaceman, depending on the day of the week and what his robot wife has picked out for him.

But fuck that, Vladimir Putin has him beat, coming out with a DVD putting his black-belt level Judo techniques on display. Putin needs to start wearing that judo outfit whenever he's in public because it makes him look like a total badass. George Bush won't look him in the eyes and see a good man; he'll see the Russian Chuck Norris.

Where did the world go wrong? How the hell did we get these insecure jackasses running the universe? No wonder we're falling apart.

"IF I WERE A CARPENTER:

AND YOU WERE A DOUCHE BAG!!!!!!" Christopher Maltisanti



That's how I feel about the Fed again today. Oh, the market's only down 80, so the the urge to claim we need a rate cut to 1% seems misplaced. But what we need right now, to offset all of the liquidity coming out of the market due to smaller bank balance sheets, is aggressive fed action to avoid years of deflation.

My safety deposit box is my savings account, and I now have EUR's and CHF's in there. I can't believe the buying power of a buck is worth much in a world where a money market acct cant hold par.

To quote another brilliant person in this world, Richie Roma's "when I find out who's cousin you are.." in Glen Gary Glen Ross echoes my emotions towards Helicopter Ben. Did you run out of gas in that chopper, Ben? Now is when we need you!

Kidnapped by Obama's Truth Squad!!

We regret to inform you that The Irish Lumberjack has been abducted by one of B. Hussein Obama's Truth Squads! He is currently being held in Room 101 at the Ministry of Love and being coerced into the following activities under threat of torture:

1. Watching Weather Underground recruiting films.
2. Chanting "the Constitution is a living, breathing document" over and over again.
3. Looking at nude pictures of Gloria Steinem.
4. Writing out fresh copies of "The Communist Manifesto" and "Rules for Radicals" by hand.
5. Watching a PBS special on the life of Margaret Mead.
6. Watching another PBS special about the courage of Rigoberta Menchu.
7. Being forced to do calisthenics wearing nothing but a latex condom and an extra small Che Guevara t-shirt.
8. Writing letters to the Wall Street Journal and Washington Times editors demanding that they stop referring to Obama's complete and utter lack of experience and his association with unrepentant domestic terrorists as "relevant".
9. Thatching a new straw roof for Barack's brother George in Kenya.
10. Being forced to debate the meaning of "is" with Joe Biden.

Wait...did we say threat of torture?

Pope Using Financial Collapse To Preach God Stuff

Things are really starting to get interesting in the market. Apparently the Pope is exploiting the financial market collapse to promote all his God stuff:

''We are now seeing, in the collapse of major banks, that money vanishes, it is nothing. All these things that appear to be real are in fact secondary. Only God's words are a solid reality."

Earth to Pope: this is information we could have used last year!

DEAR BEN

PLEASE CUT INTERESTING RATES RIGHT NOW YOU FAT IDIOT!!!!!!!!! I HAVE TO IMAGINE YOU ARE ASLEEP AT THE WHEEL AGAIN. REALLY QUICKLY: THE FED CAN CUT RATES, BUY SECURITIES IN THE OPEN MARKET, AND LOWER THE RESERVE RATIO. THREE VERY GOOD TOOLS TO DEAL WITH A DEFLATIONARY SPIRAL FROM SHRINKING BANK BALANCE SHEETS. MAYBE THATS WHY THE FED HAS THOSE TOOL. USE EM OR LOSE EM (DO YOU REALLY THINK YOU WILL BE THERE UNDER ANOTHER ADMINISTRATION)

Rich Pzena Thinks You're a Fucking Idiot

Rich Pzena is one of those value guys, the type that's okay with being long and wrong today and tomorrow and for the rest of the year because it's all about the long-term.

4/23/08 in Forbes: "They are the only stabilizing force. Their competition has dried up, so the prices they charge have dramatically increased. This is as good as it gets for Fannie Mae and Freddie Mac."

And back in November of 2007 at the Value Investing Congress, Pzena said that FRE is the cheapest stock he's ever seen.

There's also this Barron's interview from January 4, where he said "There is some short-term downside risk. Looking out three years-plus, you have a really spectacular risk/reward trade. The odds that Citigroup sells for less than 30 in three years are very low, and the odds of it selling for substantially above that are very high."

Rich was also a sucker for Alcatel-Lucent, whose former CEO Patricia "Helmet Head" Russo screwed over about a trillion investors and retirees with her bullshit plan - "In the end the price war will abate and Alcatel-Lucent will be successful in reducing costs as per the merger plan. There is a lot of earnings power here -- between $1.25 and $1.50 a share of earnings on a stock that is now $7 a share. It is pretty outstanding, given the quality of the franchise. In '08 we'll see improvement. We won't hit $1.25 to $1.50 of earnings power next year, but we'll be moving in the right direction. When it happens, the stock won't stay at $7."

This guy ran research at Sanford C. Bernstein (fucking place probably didn't even look at my resume) and he couldn't figure out that a business with three potential customers and shitloads of competition isn't all that practical.

So why does Rich Pzena think you're a fucking idiot? Because his company launched what he calles the friggin Pzena Financial Opportunities Service.

Now I've told some pretty bad lies in my lifetime. I've even told some this week. To my Mom.

But this guy takes the cake with this line of bullshit:

"Developed in response to client interest in a concentrated portfolio that would capitalize on the extraordinary valuations currently available in the financial sector, the Financial Opportunities Service comprises approximately 8-20 global financial stocks, reflecting the full research and analysis resources of the firm."

So are really supposed to believe that after being dead fucking wrong on financials, Pzena's clients want to give him MORE money to invest in what probably amounts to the XLF. If you believe Pzena on this, you are a fucking idiot.

Ode to Doug Kass:

How’s this for a rough year?

7-22-08: “This morning, I conveyed one ludicrous forecast, so now I have another one. As I also recently mentioned on The Edge, I suspect there is a growing chance that we have seen the low’s in the major averages.”

11-13-07: “I believe that equities have hit their lows for the balance of the year and bond yields (particularly of a 10-year U.S. note kind) have hit their lows (in yields) and high (in prices) as well.

I see bad (read: crowded) shorts in equities and even worse longs in bonds.

Position: Long QQQQ; short TLT”

Do people just get off on talking? Love the substance to back up the claims, also.

Memo To OJ--

Hey, Murderer--you finally got what was coming to you.

Much the same as Al Capone, you are going away for a LONG time, hopefully never to see the free world again!

It is called Karma, motherfucker.

13 years to the day of his acquittal in the killing of Ron Goldman and his former wife, Nicole Brown Simpson another jury, this one not swayed by racism and the sense that the system was working against him, found him guilty of all 12 counts.

Taste that you murdering mother fucker. I hope your tasting your cell mates cock right now, you guilty, murdering pig.

In case you have forgotten, here are a few refresher pictures to take you back to that time of Bronco chases on the 405 and non fitting gloves:

That is Nicole lying dead in the doorway, Ron Goldman covered in blood is directly above.

Speaking of the Bronco chase, hiding out in his home, take a gander at this website:

http://www.zimbio.com/OJ+Simpson+Murder+Book