Hold on to your shorts (literally)...
The tsunami of bad economic news continues unabated...
HSBC dumps it's US consumer loan division and needs to
raise $18 billion in additional capital.
AIG posts the largest quarterly loss in market history,
a $61.7 billion dollar loss, and you and I (the taxpayer)
are giving them their 4th bailout check... this one for
$30 billion (and sadly, it won't be the last).
Carlos Mendez of ICP capital was on CNBC this morning and
made a couple of major points that echoed what I've been
saying...
1. Goldman Sachs was one of THE major counter parties to AIG,
and was the primary beneficiary of AIG's bailout. GS received
$25 billion in cash, versus taking the haircut on swap
positions with AIG -- which is what should have happened.
The public is being ripped off beyond belief as insiders,
take care of insiders. Paulson totally F'd the taxpayer
on this.
Paulson is so crooked, that when he dies, they're going to
have to screw him into the ground when they bury him.
2. 92% of AIG's risk is to foreign holders. READ: You and I,
the taxpayer... are bailing out foreign banks and speculators.
3. AIG was a complete and total PONZI Scheme, it sold
insurance/swaps it did not have the capital to cover.
Isn't it convenient that Greenberg was "forced" out,
before all the shit hit the fan?
I dumped everything I bought last week on this gap up open
in gold stocks... letting shorts & hedges ride.
I think we're going to the mid-6000's for the DOW here as
we are going to see the Pro's massively naked shorting the
Joe's here, in an effort to wash out Main Street, and create
a little V-bounce trading opp.
And after a possible bounce... I think the DOW is going
to slowly grind sub 5000 as reality slowly sets in, on
how bad the economy, earnings, and the losses in the
banking system really are.
You have to be short "something" here...
Message 25450705
Message #15915 from SliderOnTheBlack at 2/27/2009 3:02:19 PM
"MY SDS ( 2X S&P Short ETF) is doing well at +4%, but I wish
our morning rally in gold stocks would have held.
I have a feeling they're going to launch a massive short
push next week to create a washout capitulation in the DOW.
Once 7k breaks...
6675-6850 would be my "wag."
The market now realizes that the major banks really are
"dead man walking -- zombie banks"... and all Geithner has
done, is buy time to the April 2nd G-20 meeting in London."
Mo later,
SOTB
Next major support on the HUI gold stocks is 248-265.
You need to be down to a core hold only position, and have
puts in place as insurance, or be hedged via broad market
short positions here.
The goal here, was to not give anything back sub HUI 285.
Stay disciplined, and be patient.
The silver lining is the underlying fundamentals for gold are
rising, but this may turn into a panic phase, and all paper
assets are subject to liquidation, and panic selling here...
and gold stocks will NOT be immune.
Gold is holding almost flat here, and it should be the bulk
of your "core hold" on these corrections.
Use stops, puts, insurance, and hedging shorts as the tools
they are... and use "PUT SALES" as your initial re-entry buys
here... and be patient, as we very easily could see HUI 248-
265 hit very quickly.
Let the stocks "come back to you here"... be patient, and
don't chase... and hang onto your shorts. |
