Michael,
Cramer smells a burning bond trader:
The Cry of the Bond-Shorting Trader
By James J. Cramer
2/4/00 9:03 AM ET
All of us have been there, the professionals among us. We have all been on the wrong side of a trade, on the wrong side of a short. I had it happen in Noxell, something you can find in the archives if you look hard enough. My head trader had it happen in the old First Interstate Bank.
Someone is short the bonds, and they are taking that someone apart.
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These numbers were strong, the average workweek was too high, so to speak, and bonds should have sold off after that ramp. They didn't. They didn't because when you are short bonds, everybody knows it and the market is determined to take that someone apart. And they will because the market is a brutal, vicious animal when you are wrong. And boy, is this guy wrong.
First, we won't find out who it is until after the account is executed. That is how it happened with Long Term Capital. We had a run in the bonds like this during the demise of that firm. It started like this, where bonds kept running and running and running and nobody would admit they were on the wrong side. Nah, nobody. Everybody in the cognoscenti knew that LTCM was blowing up but nobody would talk about it. LTCM wouldn't because that would be suicidal. The people who were pressing the short wouldn't; they were making too much money.
And then it unraveled.
The same thing is happening now to somebody. I can taste it and smell it. I don't have to know it or see it. Someone is being taken apart by this long bond, and it won't stop until "uncle" is cried.
We will all hear it when it happens.
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