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monksnake (40.54)

I'm out for now

Recs

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January 28, 2011 – Comments (6)

Earlier today I sold all my longterm holdings and most of my short term IRL, (only kept COCO and NBG for now). 

As everyone expects, there HAS to be a correction coming:  The market is overbought.  I see the situation in Egypt as the perfect catalyst to start this pullback.  If Egypt succeds in overthrowing the government, we may have a contagion on our hands.  This could result much higher oil which can lead to another chain effect to recession or depression.  Furthermore, all this government spending is proping the market up like a house of cards, there is not much underlying strength.  I believe (not sure when, expect within a year or less) that we are going to see another devastating crash that could easily equal what we experienced in March 2009.  This crash as a result of states defaulting on debt and a possible but unprecedented default on US sovreign debt. 

Because of the uncertainty of where the market is headed from here, I decided to get out almost entirely and lock in my gains.  From time to time maybe make a quick trade or two but besides that no long term holdings until we see this crash (see above) or until the market is fundamentally secure.  I'm not going sit and watch my portfolio lose 50% again (I was new to investing at the time), it was bad enough the first time.

I know I don't have much clout, but SLW looks like a good short term pick right here.

Disclosure:  I do not own SLW, but may plan on a position within the next week or so, do your own DD.

6 Comments – Post Your Own

#1) On January 28, 2011 at 11:56 PM, AvianFlu (< 20) wrote:

Not a bad idea, but now you have to figure out what to do with the money. Staying in US dollars is too risky with inflation starting to exhale it's fetid breath. My numero uno choice right now is RJA, an agricultural commodity index as you may already know.

Maybe you'd be interested in some treasury long bonds! Ha-ha! Just joking. As if ANYONE is the country would even consider those...

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#2) On January 29, 2011 at 12:05 AM, Bays (29.00) wrote:

COCO, I called that stock to retreat near it's top under my other alias, bcvz. SLW I do like ;)

Economic predictions are immposible to time. For example, Peter Schiff may have been right, but he was predicting the crash of 2008 to happen much sooner, early 2000s if I remember correctly.  He ended up being right about everything, but it just took a lot longer to pan out.

Be careful about these short term macro predicitions.  There are still lots of individual bargains out there!

 

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#3) On January 29, 2011 at 12:17 AM, catoismymotor (< 20) wrote:

I own SLW. If you buy it think of it as a LTBH, five to ten years. Two others I don't own but think have merrit are CNI and CZZ.

My best to you. 

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#4) On January 29, 2011 at 12:20 AM, monksnake (40.54) wrote:

Avian, thanks for the recommendation of RJA, I'll look into it.

Im most likely going to do some trades with silver and gold stocks in the meantime.

Bays, I got in on COCO at a fairly decent price, earnings are Feb 1 and they expect 22 cents/share vs 41-44 cents/share yoy (can't remember exactly).  I think it's overreacted to right now and imo earnings have a good chance of beating.  I believe if they do, it'll cause a very nice pop (huge short interest) and I'll get out then.

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#5) On January 29, 2011 at 12:26 AM, Bays (29.00) wrote:

monk,

My red thumb was when it was above $20, I called for it to come below $10.

I didn't think it would go this low. I'm sure fundamentals have changed since my pitch.

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#6) On January 29, 2011 at 4:19 PM, AvianFlu (< 20) wrote:

Cato: I agree on CNI. I'm currently up 117% on it with no plans to sell until commodities start petering out.

Monksnake: For a bullion play I agree with Sinch about CEF being the best way to go, although it is a good idea to buy that within an IRA or 401K to due adverse tax treatment.

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