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Tuesday,
March 10, 2009
(Cont'd from
above)...
Jim (cont'd):
First, you start
with gallons and
gallons of bears all
over the place… hey
look, you need bears
to over reach, I
mean you know, do
you get me…
yesterday the most
notorious bear of
the world, Nouriel
Roubini, aka Dr. Do…
as opposed to Cramer
fave Dr. No… came
right out and said
Dow 5000... Roubini
has been the hot
hand… and I figured
those who trade with
him, oh what a sweet
delicious call… he
pressed his bet, so
to say and didn’t
say to buy it… he
said that there
wasn’t some stocks
to buy right now… he
just gave you and
accelerated,
emergency, dive,
dive, dive… the
enemy below… he is
doomed to be bitten
by a white swan… at
the same time,
Meredith Whitney,
the queen of the
bears… a real
baronstein… weighs
in with a truly
chilling piece in
the Journal…. about
how bad credit card
debt is going to be…
oooohhh… the next
big calamity…. it is
a strong well
reasoned piece, and
you would have
surely been grateful
for having it ahead
of time if you were
short Bank of
America, or Capital
One… home run for
the bears… ooopps…
strike out.
This is what happens
at bottoms… the
people who have been
most right take that
final bridge too
far… forget the
Brooklyn Bridge,
Whitney and Roubini
bought the Armham
Bridge… so did
Moody’s, which put
out a death watch
list today…. oh,
very helpful… all of
the papers are
talking about Dow
5000, giving us
plenty of bearishes…
and on top of that
Senator Richard
Shelby, the ranking
Republican on the
Senate Banking
Committee saying
that the big banks,
and perhaps all of
the banks should be
liquidated… yeah, he
used the term
liquidated… maybe
Richy, at least a
little trip to the
coolack first before
the liquidation…
that is kind of
pallable bear
sentiment… makes it
a great first
ingredient in any
big move higher… I
have been calling it
Gold Medal
Bearishness.
Next, you need to
trap the bears for a
truly magnificent
rally… we got a
genuine bear trap
today, with Senator
Chris Dodd and
Congressman Barney
Frank, both
advocating bringing
back the Uptick
Rule… which required
short sellers to
wait for a buyer to
pay a higher price
for a stock before
they could come in
and bang it down… I
have been on a
crusade to get the
Uptick Rule restored
and make the world
save for capitalism
again… as without it
short sellers have
been able to drive
stocks into
oblivion… destroy
the common stocks of
just about
everything, but
especially the
banks… with the
rapid fire selling…
now we have got
Barney Frank saying
that I have spoken
to Chair Sopero of
the SEC… I am
hopeful that the
Uptick Rule will be
restored within a
month… within a
month… and Chris
Dodd is saying that
it should happen
even faster… Chris
Dodd, Barney Frank,
I have been
thinking, they watch
this show… they
watch this show even
more closely than
Jon Stewart… oh
check that, no one
watches it more
closely than Jon
Stewart… anyway, you
bring back the
Uptick Rule you will
most likely get rid
of the UltraShort
Financial ProShares,
the SKF, an ETF of
mass destruction…
that has allowed
people to double
short the banks… but
with the Uptick
restored, I don’t
think that you can
set that up anymore…
it is my secret
ingredient… I have
discovered this like
the alcameade behind
Ned & Mary’s
chocolate chips…
pass the Toll House…
pass the Toll
Brothers house, up
more than 10% today.
Then we add a
spoonful each of
three big positives…
three eggs beaten…
remember, I have
said that if I saw
material facts
showing that things
have gotten better…
I would get more
bullish… well, I
have got three of
them… I have got one
in tech, one in oil,
and one in finance…
but we have got to
do is we have to add
more flavor to this
rally… in tech last
night, Texas
Instruments said
good things about
inventories being
low, they saw some
improvement in
demand for 3G cell
phones… you can
extrapilate away on
that… you can just
buy every other
semi-conductor the
socks index was
high… I found two
socks, I found them
both at the
Wash-N-Dry… we got
Research In Motion,
we got Analog
Devices, we got
Skywork Solutions,
how about Qualcomm,
Cramer fave AAPMCT
name… a dash of
plain vanilla tech
bullishness.
Hey, about the oil…
we got some good
news there… oil is
stuck in the $40’s…
no longer going to
the $30’s… it seems
to have a lot of
money flowing back
into the area…
flowing like ten
teaspoons of land
O’Lakes… you know
oil is going higher
when the lead story
in the business
section of The New
York Times… hey,
sell that building
see if I care…
wondering if crude
could fall even
more… more, even
more…. through in
the incredibly
bullish conference
that Chevron today,
that is a AAP name,
with its enormous
replenishment rate
of 148%… and you got
real reason to
believe that crude
will keep working
higher… that is a
big deal for more
than just the oil
patch… it helps the
infrastructure
companies where we
were worried that
some of the big
projects were
threatened by low
oil prices… I call
it the pie crust.
Alright, the next
ingredient in the
big rally… this is a
big cake… the third
big positive to make
the recipe work…
major good news in
the financials…
Bernanke is ready to
show the banks
forbearance by going
mark to market
light… that is what
I call it, I made
that term up… you
will hear it from
everybody tomorrow…
meaning that there
will be an
adjustment in
evaluation against
the lowest common
denominator of real
estate… this moves
every financial…
they are all
battling strict mark
to market
accounting… if we
get mark to market
light, and
forbearance… then
the banks are all
incredibly cheap…
and look like they
are ready to roll… a
bag of Domino’s
sugar coming right
at you.
Now, add a dash of
good numbers from
Citigroup…
Citigroup… the ones
that show that it is
having its best
quarters in a couple
of years… because it
turns out that the
banks are making a
ton of money as they
pay you zippola for
your deposits… they
can borrow for next
to nothing… and they
can lend like
shylock… if you
prick them to then
not make money… if
you poison to they
not snap right back…
if you restore the
Uptick Rule, suspend
mark to market
accounting and show
them forbearance do
they not soar…
thanks Bard… if
things are good at
Citigroup… then I
now feel that we are
going to be seeing
some upside
surprises at Golden
Slacks, at Morgan
Stanley… the icing
on my rally cake…
what is that I
smell… I think it is
an upside surprise
baking in the oven…
even the state
insurance regulators
showed us
forbearance for the
beleaguered
insurance companies…
I mean, that is how
many things are
going right… put it
all together and you
get one fantastic
rally that I do not
believe is over… I
can cook just as
well as Martha
Stewart… if I have
the recipe, guess
what… I just made
you a chocolate chip
cake of an upside
surprise rally.
The bottom line…
▼ ▼
▼ ▼
▼
 The Bottom Line!:
I have said I will
change my mind about
this market if the
facts change… if we
got some material
positives… more than
just sentiment… and
we got a boat load
of them…. a recipe
for a genuine rally,
much higher… and it
ain’t done yet… for
those who bet
against perma bears
like Roubini… it is
a dish best tasted
cold.
The market got key
ingredients it
needed today for a
rally & it could go
higher.
Alright guys listen
up… when you are
making a cake in
preparation for
being on the Martha
Stewart show… and
the Dow is up 379
points… and I have
got to tell you
something… this is
how you make a
rally… you drowned
the bears in
chocolate chip cake…
and you get an
upside surprise.
[verbatim recap]
▼ ▼
▼ ▼
▼
Jim went on after
this segment to take
questions from
callers, and
responded with his
comments...
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Q:
I have got a
question for you
about oil. It looks
like the economic
indicators inside
the financial are
not going to work
for us this time
around, I am
predicting a major
bounce, 1000 points
or more, oil leading
the way, what do you
think? I am betting
on BP to take us out
of the market, ETF
Chevron, Conoco
Phillips?
Jim:
Alright, I like the
oil stocks they have
been the leaders for
a while… they can go
much, much higher
because most of them
are selling at 3 or
4 times earnings… I
was on the Chevron
conference call…
Chevron has been
notorious at not
being able to
replace oil… the
fact that they have
got 148% replacement
tells me that this
group be moving.
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Q:
I was wondering if
Caterpillar was
going to be a
leading indicator in
the economic
recovery?
Jim:
Cat, no that would
be lying… the would
be the last thing to
go… first you would
get credit going…
and then you would
get some orders, and
then they have to
blow through the
inventory…. because
it is all sitting on
the lots… and then,
and only then, would
they place new
orders and Cat would
go up… and that is
why Cat has been so
slow to recover… and
that is not going to
change.
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[verbatim recap]
[end of segment]
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