Time to sell

I know I was about two months early on this, but I think today was finally the day I have been looking for. Start taking profits on your stocks if you have them. There is just too much lining up here that makes me nervous that the "big correction" is finally here. Today the NASDAQ fell through trendline resistance, but more importantly closed under this trendline resistance from the March lows. 1050 was a key resistance number on the S&P 500 and it was breached today with an accompanying close under 1050. And maybe most importantly, the SOX (which is 88% correlated to the NASDAQ since 2006) closed under its previous low from a few weeks ago. If you follow technical analysis/Dow Theory, this is a layup...time to sell. Since the techs are the ones that led us up, it figures that they will be the ones to lead us down.

Now, I could be wrong. I like to think I was just early to the show in August but we are way past due for a 10% or even 15% selloff in this market. Art Cashin has been right all along. And I put my money where my mouth is today...I moved about 40% of my IRA into cash and my QQQQ puts are a few pennies away from breakeven. Sometimes the stars just line up.....

Eating Crow as usual

Well...if the game would have been 30 minutes instead of 60 minutes I would have been the great prognosticator of a victory. Unfortunately, I am a huge loser this weekend in all three football arenas...college football, pro football and fantasy football. I am firmly convinced that the Dolphins would be 4-2 right now if Ted Ginn wasn't on the roster. Sorry Teddy...I am finally turning against you. You have had too many drops in big spots. Zach could catch more passes than you these days....

Predicting a Win on Sunday

I am predicting a Miami Dolphins victory on Sunday against the Saints. Maybe I am crazy, but I figured it was time to go out on a limb. The Dolphins are coming off two nice victories and are rested after a bye week. Nobody is giving them any chance of winning. If the secondary shows up it will be a good game...if they dont it will be ugly. Worse case scenario they lose...it's not like anyone reads the Margarita Lounge anymore so I wont have many people to grovel to...

BTW...Cheryl has been doing a great job over on Zach's blog...check it out if you haven't in a while. The link is on the right....

Still stupid...

Yep...I am getting my ass handed to me again. As though it wasn't bad enough that my QQQQ puts are underwater by about 30% in 2 weeks, I am so stupid that I have decided to also buy puts this week on the S&P 500 (SPY Sept 102's averaged in around 2.10). I am so happy that the rest of my investments (the majority that I don't constantly trade) are all long and making money right now.

Glutton for Punishment...

After swearing off options and getting my ass handed to me on multiple occasions, I am back in the ring with them again. Am I really this stupid? Yep. The tide has to turn eventually, right?

With the big run-up in the NASDAQ since mid-July, in addition to the talking heads on CNBC ALL now saying we are going higher from here, I have decided to go short. I bought some puts on QQQQ over the past couple of days...The Oct 40's to be exact...I am averaged into them at about 2.07 per contract. I figure if we can get a pullback to 36 on QQQQ I should be able to make a nice, quick profit and put that money back in long. Plus, there is a gap around 36 in the chart on July 14/15 and I am a big believer of gap-filling on both the upside and downside. All I can do is lose money, right? I really am stupid...

And now...a lighter moment

I realize I can get a little too serious at times on the Margarita Lounge. So...today we are going a completely different direction. Check out the following page, courtesy of Scotty "the gun permit owner" Greenough over at the Wysiblog. Make sure to go to the bottom and click on "older entries" for more and more pages of fun. I have been laughing my ass off for five minutes on this one....

www.awkwardfamilyphotos.com

A Great Article on Climate Change...

Here is a great article on climate change that everyone should read. Don't worry...it's not one of those over-written 6 pagers that is way too heavy....this one will only take a few minutes to read. Thanks to Mr. Leinwol for the article...

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=482572

More Stupidity in Washington

Even though I am a loyal Republican, when I hear ideas and comments from Democrats I try to listen and understand. Most of the time I still disagree, but at least I try to see the other side of the story. This week, I have twice been completely floored by the level of stupidity of people. And these are the people we trust to lead our country? This is really scary. Here they are:

1) Joe Biden, the Vice President of the United States. A few days ago he told a gathering of AARP members the following: ‘What are you talking about, Joe? You’re telling me we have to go spend m-oney to keep from going bankrupt?’” Biden said. “The answer is yes, that's what I’m telling you.” Imagine what would happen if a person filing for bankruptcy told the bankruptcy judge this...that he needed to spend more money to stop from going bankrupt. The judge would probably tell him he was a moron. If I was the judge, I would lock the dude up for being loco. Yet the Vice President of the United States seems to think this is an acceptable thing to tell the public.

2) Larry Summers, Economic Advisor to the President. According to Larry, the number of searches on Google for "Economic Depression" has fallen substantially since the beginning of the year. This is Larry's proof that consumer confidence in now higher and that things are getting better. Is this guy crazy? Number of searches on Google? I can't beleive someone who is an Economic Advisor to the President thinks this is somehow an important economic indicator. I have been telling people for months that things are looking better, and I use actual leading economic indicators, as do most respected economists.

Both of these situations are really pathetic. It just shows the American public that Barack Obama has no idea what he is doing...no idea whatsoever. He is cut from the same cloth as the other spend and tax Democrats that have been in Washington for decades. He wants to spend money and he is going to tax the wealthy and the small business owner to death to get the money to spend. He is not the "change" that everyone voted for last year (as I have repeatedly said)...he is just another politician pushing his own agenda.

Death of the Democrats?

This article could spell the beginning of the end for the Democrats in Congress. A huge TAX increase on the wealthiest Americans during a historical recession. Nothing stinks worse that this bill. Tax the wealthy (meaning small business owners in many cases) to fund a joke of a government-run health care system. The tide may have finally turned. I really never thought the Dems in Congress could shoot themselves in the foot so quickly...


http://www.cnn.com/2009/POLITICS/07/10/house.health.care.tax/index.html

A Strange Happening at the Margarita Lounge

I just had to let everyone know about this as it is the oddest thing that has happened at my house in a long time. Call it a "LOST" moment, but this is a 100% true story about something that happened two hours ago in my house....

It was almost 8pm and Zach is getting ready for bed. Dawn was reading a story to him in his room, they were both sitting on the floor. As I walk into Zach's room, I notice there is a football card on the floor right outside his door. As I am not a football card collector, I thought it was rather odd as I have NEVER seen a football card in my house in almost 6 years of living here. But I didn't actually bend down and pick it up...all I noticed was "Titans" across the top of the card. As Dawn leaves the room she picks up the card and we notice it is a 2004 Steve McNair card.

I have had the heebie-jeebies ever since. I mean...what are the chances of this happening? I have since found out that the card was in one of Zach's books that he just got from John Renko within the last week or two. But what are the chances of this card falling out of a book and onto my floor a few hours after McNair was found shot to death in Tennessee? Weird to say the least...

Whats going on...

It has been a rather busy week around the Margarita Lounge. A few things on my mind recently:

1) What the hell is going on with Hollywood celebrities? Ed McMahon, Farrah Fawcett, Michael Jackson, and now Billy Mays all die within a week. Crazy stuff...
2) Cheryl and I went to Naples last night and had a great time. It was really quiet, we had a GREAT steak dinner and got away for a little while. Zach got to stay with Mimi and Papa...
3) Cheryl's sister Dawn is coming into town on Thursday Night for the July 4th weekend. We are both looking forward to seeing her and catching up for a few days.
4) Gotta love 4 day work weeks. With July 4 falling on a Saturday this year, both Cheryl and I get Friday off...3 day weekends rock!

That is all for now...more soon.

Fear not stock lovers

Yeah...I know. You are worried because the S&P 500 went from 666 to 956 in a couple of months and it is now back under 900. Is it time to take profits and go back into cash you ask? My answer there would be a resounding "no". To find out why I say that, just answer these two questions for me....

1) Is the US Economy going into another depression?
2) Are the leading economic indicators better today than 6 months ago?

The correct answers here are no and yes. It is very typical to see conflicting news stories in the very early stages of a bull market. Once the news/earnings are all good and the recovery is underway and everyone wants back in the stock market, the S&P will be over 1000 and by then you have missed the easy money. In the short term I think we will see a low between 810-860 on the S&P 500 (10-15% pullback from the recent highs) but I don't see a return to the doom-and-gloom of early March when all the "experts" on CNBC were talking about nationalizing the banks and the new depression. Funny how silly people can look only three months later.

The good news here is that if you have missed the recent upturn, you can get in now and still see some nice upside in the next 6-12 months. You have already missed the real easy money, but you will still be ahead of all the "experts" still sitting on their hands while the fundamentals of the economy stabilize and start improving later this year and into 2010. Even if you put the money in corporate bonds funds, it's better than sitting in cash or US government bond funds right now. Trust me...

I agree with Bill Maher? WTF?

Wow. I never thought those words would ever come out of my mouth. For those of you unaware of who Bill Maher is, he is a liberal guy who does some type of show on HBO. Below is the entire five minute rant. Granted...he is still an out-in-left field guy who seems to think that all the world's problems are caused by big corporations. Yeah...all those big, bad corporations that employ all those MILLIONS OF PEOPLE. But I digress. Here is the link....

http://www.youtube.com/watch?v=HWulnfog20c

"Cash For Clunkers"...say it aint so!

In addition to spending like drunken sailors for the past few months, I just read a story about the $4 Billion bill the Democrats in the House just passed for the "Cash for Clunkers" plan. No... I didn't make that name up...look it up online if you don't believe me!

Here is the jist of the program...if you own a car that is more than 8 years old and a gas guzzler, you can turn it in and get a voucher from the government for between $3,000 and $5,000 toward the purchase of a new car. The only restriction is that you can't buy a car for over $35,000 with the voucher. Am I the only person out there who thinks this is a completely STUPID idea with tons of potential for fraud? I understand the idea and I am sure that Al Gore is jumping for joy on how Obama and the Congress is saving the world here, but this is SO STUPID. Here's why this is such a stupid idea....

Go buy a piece of shit car today for $1,000 from a junkyard that barely runs. You take this car and turn it in for a $3,000 voucher on a new car. You just pocketed a $2,000 handout courtesy of the government towards your new car! I now understand why people cannot live within their means when they see the government set such a great example. Ugh...

Market Update

Well, as usual I was wrong on the short side and got crushed. The market just keeps going up and up without a correction to be found. I decided to pull the plug on my FAZ trade around 4.65 this week. As they say...don't fight the momentum. I am getting even more confident that this recovery is the real deal though as the days go by. I guess I could always be wrong on that too, but I just don't see how we are going to head back to 666 on the S&P 500 even with a big negative surprise. Hope all is well out there for all of you....more as I am inspired.....

The Margarita Lounge will live on!

I am proud to report that I have decided to keep the Margarita Lounge alive! With my regular use of Facebook, I have recently felt that the Margarita Lounge would end up a relic of the past. I have decide that they are just two very different animals.

Facebook tends to be good for quick updates of what's going on in my life. But I think the Margarita Lounge is a better venue for any "detail" stories as well as my occasional long rants about things in the world that piss me off. Thank you to everyone who told me I should keep it going.....

Rain Rain Go Away

Well, I guess we needed to get a little rain....but, we're tired of it now. Seems as though it's been raining for an entire week straight. Our entire back yard was literally under water this afternoon - the good news is that we won't have to turn the sprinkler system on for a week or so.

Market Update

Sorry for the lack of recent stock market commentary, loyal readers. I realize that most of you are probably not interested in this, but since I am and its my blog I can do what I want! Ha Ha.

Seriously though, I am VERY impressed with the recent move in the market off the March 6 lows. I can say with 95% certainty that we will not see the March lows again. The VIX is down below the Sept/Oct levels, yield spreads on bonds are tightening, and there is a growing realization that this is not going to be the "Great Depression #2". For those with a short memory, please read my April 6th entry where I mention hitting 900 on the S&P 500...I think we closed today at 903. I love tooting my own horn when I am right!

Long term I am still a big bull on our economy and the market. It wouldn't surprise me to see the S&P 500 near 1000 by the end of the year...maybe even a little higher. That being said, I think there is a strong case for an aggressive trader to make a few bucks here going short. After all, we have had a 35% run and no major pullback(considered 10% or more)...a situation that makes me a little nervous. So...I bought some FAZ today around 5. I have done this recently a few times and have been crushed, so you think I would learn, right? But I think I am right this time. I figure if I can get 6.5 to 7 out of it I will be happy...then I can go back into the market long at a cheaper level than we are right now and ride the wave into the end of the year. You could also do this with TZA, which I did for a few of my more aggressive clients today between 25-26.

Janes Addiction/NIN concert

After being a big fan of both Nine Inch Nails and Jane's Addiction for years, I was needless to say excited when this concert rolled around...there was NO WAY I was going to miss it considering the opening date of the tour was 15 minutes from my house. Last Night was as close to a religious experience as I get. While I would have liked to see both of them play longer (the West Palm Beach noise ordinance makes concerts end by 11pm) I was still very happy to see them play live finally. And considering it is Trent Reznor's last tour as NIN I am glad I got to see him before he hangs 'em up.

I posted a few links below to a guy who goes by bootlegbyeddie that recorded the concert. I have never met this guy and the audio is a little rough, but if you want to get an idea of what it was like last night, here are two songs from Janes and two from NIN for your listening and viewing pleasure:

NIN WISH

NIN HEAD LIKE A HOLE

JANES PIGS IN ZEN

JANES JANE SAYS (last song of the show)

End of the road for the Margarita Lounge?

After a few months of thought, I am considering shutting down the Margarita Lounge for good. I have found it harder and harder to get the time to update it on a regular basis. That and the fact that Facebook is now the preferred networking site has brought me to this point.

So...does anyone out there still read the ol' Margarita Lounge or should I throw it on the trash heap? Of course, Zach's site will remain as he is the man.