Fellow AMD longs, be sure to hedge.
I believe the markets are going south.
Short or buy puts on INTC today. Bernarke is supposed to talk today, tomorrow and thursday. If we're going to judge from past experiences of what happens when he opens his big mouth, this could be 1929 all over again... ;-)
No, seriously. I'm not even long AMD at this very moment; all my money is in INTC puts, so I got my money where my mouth is, big time. I really do think the markets are going south from here.
JMHO
My theory in more detail:
I think the feds are fighting the wrong ghost.
My belief is that we are in deflation, not inflation. Look at cpu price wars. GPU price wars. Whitebox price wars. Automobil price wars. Transports price wars. There's one thing, and one thing only, driving prices higher: oil.
And there's one thing, and one thing only, dampening your standard of living: debt.
Debt is like 100 times larger than the cash in circulation.
You probably spend more servicing your debts than you do on food and clothing. Right or wrong?
Banks know that the lion's share of debt is unpayable, so they've probably decided it's repossession season. Bernanke is just the execution's narrator. The banks are doing this in concert around the world. This is not a US only thing. All throughout Europe and Asia, interest rates are going up 1/4 of a point. They are purposely trashing the markets, IMO. Next is probably wars.
JMHO, of course. But I just wouldn't forgive myself if it happens the way I think it will, and I didn't share my theory with anyone. By all means, keep your AMD shares; they are golden relative to the market. But if I were you I'd hedge, to be safe from a market downturn; that's all. And I'd borrow if necessary to put enough money in, to cover margin.
If it's true that INTC is being upgraded today, it could present a great opportunity to get such a hedge. Remember they are still owing WS a warning. Could come today, for all I know, but more likely by wednesday.
Sorry I'm not even mentioning transistors; I'm more technically than financially inclined, but investing is more than just about technology, and I really, honestly think we're entering a bear market, and that stock investors need to hedge right now. |
