Use access key #2 to skip to page content.

From bull to ultra-bear in less than a week.



May 08, 2009 – Comments (10)

OK, the first thing I want to say is that if anyone wants to copy my portfolio, your taking on about the most risk you can in CAPS and I'm an idiot for doing it in the first place, but I'm also a stubborn idiot and I'm not gonna let anyone (especially the government) tell me everything is ok when it's not. I prefer not to be a sheep being blindly led into the building that says "slaughterhouse" on the door.

If you look at the chart for my CAPS score, you'll see that I started at the first of the year at pretty close to zero. From that point on, I've had a slow and steady rise to 4,000 in the last 5 months. Before 01/01/2009 I was actually negative as I struggled to adjust to the bear market. By the first of the year I had adjusted, but my portfolio still had mostly green thumbs as I'm a bull by nature and I threw in enough red thumbs to help my score rise. On the exact day the rally started I went back to being a bull and was about 97% green thumbs until May 1st. There was no genius on my picking March 9th. I was simply picking a bear market rally from some time in March until some time in October when Commercial Real Estate starts to have an effect. March 9th happens to be my birthday, so I picked that as my rally day. I made a ton of changes to my portfolio and reaped a lot of benefits from the rally. But even as I was making gains, I saw a lot of news being reported that should have hurt my portfolio and didn't. I'm like everyone else and didn't look a gift horse in the mouth, until I realized that the gift horse was actually a trojan horse. I then went from bull to ultra-bear in record time! I'll now explain what I've seen.

1) If you believe in efficient markets, (which I don't really) then the banks are currently the best run companies in America right now. A lot of banks are trading near their highs.

2) Goldman Sachs is a company that is poor enough to have to sell stock to buy themselves out of TARP, but suddenly rich enough to trade enough out of their private account to control 25% of the market. (More than the next 14 brokers combined)

3) Bank of America has to raise half of their net worth in extra capital and the stock rises.

4) Since the rally has started, the vultures haven't picked on any large cap company. Not one! Even in the biggest bull markets,  the sharks would still randomly kill companies to make sure everyone knew they were around.

5) There are about another hundred things I've noticed, but those are a few from the last week. 

 Now about what I did. I've bought precious metals and mostly silver. (way undervalued compared to gold) I've shorted every Ultra-long ETF I could find and bought every Ultra-short. I took a big hit in score today, but I don't care. I'm gonna keep these picks open even if my score turns negative. The market will drop and will drop soon! I'm just praying the country will recover. History has shown that every country that tried to manipulate their way out of a recession has failed. This economy isn't just manipulated, it's been manipulated criminally. 

I wish everyone well and hope that I'm wrong, but I'm stocking up on bottled water and ammunition.


10 Comments – Post Your Own

#1) On May 09, 2009 at 12:25 AM, automaticaev (< 20) wrote:

I might actually care if you bought that stuff for real but because you only did it on "fantasy" stocks i assume you dont even belive what you said.

Report this comment
#2) On May 09, 2009 at 12:42 AM, nuf2bdangrus (< 20) wrote:

Goldman Sachs is a company that is poor enough to have to sell stock to buy themselves out of TARP, but suddenly rich enough to trade enough out of their private account to control 25% of the market. (More than the next 14 brokers combined)


You are one of the few that sees this.  It's them running the show on behalf of the WHite House, where the revolving doors lives.


THe public has at last been succored in by buying the secondaries.

Report this comment
#3) On May 09, 2009 at 12:44 AM, automaticaev (< 20) wrote:

how is anyone suckered in just sell it the second its going to drop and you made money.  Looks like you benefit from it...  Suckered in??????????????

Report this comment
#4) On May 09, 2009 at 1:04 AM, checklist34 (98.93) wrote:

I don't get BAC being up this week, they face enormous dilution.  I kissed the majority of my BAC goodbye over this rally for a nice profit. 

I'm not much of a conspiracy theorist and I don't know if I can buy into the Goldman controlling the market theory. 

As for CAPs, its just a game.  I'm very proud of my good performance on CAPs, but I've done better in real life and i'm more proud of that.  Like you I don't doubt that we're going to see some more ugly on the market, and I continue to submit that real life, real money longs should almost hope for a drop in the market.  It'll be good over the long haul, help to get more long-term buyers in at levels they are happy with, and stabilize things.

And... it'll create a chance to buy ultra bargains anew, and thats alot of fun. 

Report this comment
#5) On May 09, 2009 at 1:10 AM, ChrisGraley (28.63) wrote:

Auto I've actually done the same thing in real life on a much more conservative scale.  The only ETF's I'm playing with though in RL are FAZ and FAS. I've been real heavy in the options market though.

I can be an idiot on CAPS if I want to, but my family will not understand the concept of being broke in protest.

Report this comment
#6) On May 09, 2009 at 1:35 AM, ChrisGraley (28.63) wrote:

I agree checklist34, this is just a game, and I'm hoping I'm not coming off as a lunatic here, but a lot of people don't understand that there are 2 sides to every trade.

I've been on the wrong side many times and accepted it, (especially when I was learning, and I'm still learning.) But, I can't accept a market that's not a fair playing field. Most of the senior debt holders of Chrysler were themselves, investment vehicles. A lot of people think it's ok to abuse their rights in a crisis, because they have deep pockets, but few people think a step further about how they might be a key part of somebody's pension fund. There are a lot of things a government can do outside of the market to manipulate things, but this government chooses to manipulate from the inside.

 It's not gonna end well. It can't end well.

Report this comment
#7) On May 09, 2009 at 1:49 AM, checklist34 (98.93) wrote:

Chris, I don't fully follow your comment about Chrysler bondholders.

I am perplexed or even outraged at the bondholders getting wiped basically completely out while the Union gets offered an apparent sweetheart deal where they own the company.  To me that was politics (lib admin paying back its supporters) most foul.  To the considerable detriment of peoples retirement funds, etc.  I am not intimately familiar with the situation, but to me it has long seemed like the union was complicit in the failure of big auto here in the US, and to reward them for helping everything fall down the stairs seems bizzare. 

Report this comment
#8) On May 09, 2009 at 2:14 AM, ChrisGraley (28.63) wrote:

I'm not sure why you don't follow me on that checklist, we seem to be in complete agreement. I agree that the union had a major role in destroying Chrysler.

I'll try to put what I said into different words. I'm not upset that we are in a recession and I'm not upset that the goverment is trying it's best to get us out of it. What I am upset about is that the government is willing to commit crimes to do it, and could care less if it destroys the little guy playing by the rules.


In other words, I'm pretty sure that I agree with you.

Report this comment
#9) On May 09, 2009 at 10:24 PM, devoish (83.42) wrote:

and could care less if it destroys the little guy playing by the rules

The little guys were the union.

Report this comment
#10) On May 12, 2009 at 3:14 PM, kirkydu (90.54) wrote:

I've always believed in having 3-6mo supplies in the house and rarely followed that belief.  However, I have now stocked up and am planting a very large garden. 

While the rally probably goes to at least June, at some point we revisit the lows.  I happen to think it will be a 1 to 2 year drift back down rather than a plunge, butt either way, it's dangerous. Then inflation.

Report this comment

Featured Broker Partners