March 25th
Brendan gave a tutorial of what Epiphany is about , and what we are trying to accomplish on this site. It was rather passionate which shows his commitment to this project of ours. We are going to expand on this during the Conference on May 16th in Red Bank New Jersey, as well as have Steve Nison from Candlestick Charting give an outline on candlestick charting and set-ups.We are going to gather after words at a local establishment afterwords were there will be other Wall Street guys to further our conversations in a relaxed envirement. It will be a great networking opportunity also. I strongly urge all of you to spread the word and attend. We have 99 seats of which about 30 are taken. The price will be released soon, as we are examining our costs and trying to give you guys a great experience for your money. Please contact me at fdelaneyiv@gmail.com. Many of you have responded and there is no need to repeat an email to me.There will be more details coming next week. Have a great trading day. S&P resistance up around 822-826, support at 801 , then 789. Trade with conviction or keep your hands off the keys. Regards, Frank
Cashin's Comments
ReplyDeleteFAIR VALUE = -285 BUY PROG = -185 SELL PROG = -385
CASHIN'S COMMENTS
WEDNESDAY, MARCH 25, 2009
[AN ENCORE PRESENTATION]
On this day in 1911, it was a Saturday in New York. At a building on Greene Street in what is now called Soho a group of immigrant girls were busy at work at their sewing machines. There were no clocks in the room - "clock watching" slowed production. But whisper of mouth said it was just a half hour to closing and, thus, the weekend.....(Sunday was a day off, after all).
Suddenly, at the end of the room, a spark ignited the stacks of fabric and boxes. In an instant the clutter was an inferno. Nearly 800 people were in the building, and, amid screams and scrambling, they clawed, crawled and climbed down toward safety. Unfortunately, 147 of the young ladies who worked for the Triangle Shirtwaist Company died in the blaze.
The whole thing was over in less than a half hour - but the impact of the event would influence decades. Although the proprietors would be found "not guilty of negligence", the case became a national scandal. It led to a major change in the New York City building code - became a shibboleth for socialist organizers - and allowed the International Ladies Garment Workers Union to blossom.
Caveat to Male Readers - To mark the date be very, very nice to some young working girl. However, if you intend to play a quick game of "look for the Union Label".....you better give an adequate warning.
There were neither fires nor much fooling around on Wall Street (at least near me). Rather, what we had looked like a classic and healthy "digestion day."
Stocks Churn Off A Bit Of Monday's Overbought. Fed Throws An Afternoon Curveball – Tuesday saw both prices and volume contract after Monday's whopping 6% rally. That was to be expected. Even a dope, like yours truly, could see it coming. In our Tuesday morning Consensus call we wrote:
Consensus – Big, big rally has taken us to heavily overbought so pull back is in order. Bulls need to keep the pull back orderly and controlled. Stay very, very nimble.
That's exactly what happened and the bulls did a pretty good job of keeping the pullback contained. Once again the markets appeared to shrug off economic data and focus on the doings in Washington.
Stocks opened lower and, after a quick head fake around 10:00, seemed to inch steadily higher as the Geithner/Bernanke hearings progressed. Traders like the idea that the two refused to play into the "villains and victims" game that many of our elected official have persisted in playing recently. They also failed to conceal their frustration with some of the counterproductive questioning.
Stocks managed to make it into mild plus territory by mid-afternoon. They then rolled over and headed down to close at the day's lows. Some traders felt the pullback was a reaction to a late day spike in Treasuries. (Rallies in Treasuries have accompanied many selloffs in stocks through this long bear market.) The Treasury turnaround was attributed, in part, to a terrific two year auction with the seemingly enthusiastic foreign bidding. We think the real thrust in Treasuries came from the surprise Fed announcement that they would begin their Treasury buying as early as today. Others felt the pullback was a response to Geithner's request for sweeping powers to seize future AIG's.
Although stocks closed on the lows, there did not appear to be a lot of technical damage done. The S&P stayed above the psychologically significant 800 level. We had suggested support at 804. The intra-day low was 805. Also important was that it remained above its 50 day moving average. All in all, not a bad day even though it was down.
Riding The Roller-Coaster With Timmy – There's an old floor broker adage about roller-coaster markets. It says they provide heart-stopping plunges, exhilarating highs and stomach churning turns. Yet, when it's all over you wind up close to where you started and it cost you money to ride.
One floor wag point out to me that after the release of the Geithner plan the S&P closed at 822. That's almost exactly where it was before Mr. Geithner strode to the microphone weeks ago to announce a concept with little or no details. So were' back where we started and it cost all of us money.
Congress May Be Deconstructing The Rescue – In the wake of the AIG "bonus outrage", Congress has threatened to cap compensation at any company getting Tarp money. That has prompted Goldman and others to say they will buy back their freedom by returning the TARP money. The government had originally insisted that some folks take TARP funds whether they needed them or not. The purpose was to cloud the difference between the obviously healthy and the obviously threatened. The point being that if you could identify the weak, you would withdraw funds and exacerbate the crisis. Further, the healthy would dominate and cherry pick the finest minds on Wall Street. It appears the action of Congress may cause the above to happen. I'm from the government and I'm here to help you – yeah! right!
Cashin's Comments Page 2
Wednesday, March 25, 2009
Mark To Market – We, along with some actually smart people, have maintained that the "mark to market" rule, imposed on November 15, 2007, has served to accelerate and exacerbate the banking crisis. Some observers say there is evidence that MTM may have actually caused the crisis. The timing is consistent. We'll dig further.
Cocktail Napkin Charting – If weakness develops in the S&P, a break of 804, 800 and the 50 DMA (793), the shorts could swarm, smelling blood in the water. Support would then revert to 775/780. Resistance on the napkins looks like 825 and then 840/845.
When The Only Tool You Have Is A Hammer Everything Looks Like A Nail – Especially If You Are Lady Mondegreen – Every trade has its own argot. Short-term phrases that may be confusing or even bewildering to strangers. A phrase commonly known among floor brokers (and much of Wall Street) is "Green Shoe." It refers to an over-allotment (or issuance of extra shares) in an underwriting. It was first used by the Green Shoe Company (now Stride Rite) back 1919. So, in verbal shorthand, a broker might say "they're gonna exercise the Green Shoe" and his fellow brokers would instantly know that more shares would be issued than initially announced.
The reason for this digression into Wall Street terminology was an incident that occurred on the floor Tuesday morning. Two brokers were listening to CNBC's Squawkbox which was featuring a panel of Wall Street heavyweights. Among them was Goldman's Abbey Joseph Cohen. The brokers heard her say that she sensed some early signs of "an economic Green Shoe." The brokers looked at each other quizzically. What as an economic Green Shoe? How did it apply? One broker hit Google. The other emailed friends. Yet in both cases there was no answer.
After an hour of frustration one of them approached me. "What's an economic Green Shoe?" he asked. I stared at him like he had two heads. "What are you talking about?" I said, since the phrase could be Venusian to me. Then he told how he heard it. That's when I began to laugh out loud.
I realized that they had mis-heard the comment. Ms. Cohen had used an image that has been making the rounds in punditry. Citing a few early signs of minor improvement, folks have begun alluding to a few "green shoots" of economic recovery (as in early spring growth). When I explained, we both had a good laugh.
I pointed out that mis-hearing a phrase and converting it into something more familiar to you is not uncommon. In fact, it is called a "Mondegreen." That comes from the 1954 Harper's article by Sylvia Wright. She said that for years as a child she mis-heard the last two lines of the first stanza of a poem titled "The Bonnie Earl O'Murray." The real two lines are:
"They have slain the Earl of Murray"
"And laid him on the green"
Since the small child had no easy reference for depositing a hero on a green, she morphed the last line into:
"And Lady Mondegreen"
Thus giving the Earl a female companion who was also, unfortunately, slain.
Mondegreens are particularly common among children. The line in the fabled hymn that goes "Kept by thy tender care, gladly the cross I'll bear" is often heard as "cross-eyed bear." Children unfamiliar with chestnuts hear the Christmas song as "Chipmunks roasting on an open fire." In the sitcom "The Nanny" a character hears a line from "Lucy in the Sky……" which goes "The girl with kaleidoscope eyes" as "the girl with colitis goes by." Now, where did I put that green shoe anyway.
Consensus – Mtge refinancings are exploding as rates plunge under Fed influence. Fed starts Treasury buys today so rates will be watched. Interbank rates still sluggish and resistant. President's speech does not appear to affect markets. Today's action may be very, very important especially if 800 is threatened. Stay alert and very, very nimble.
Trivia Corner
Answer - The three weights the General Store would need to measure every pound from one to thirteen would be: 1lb; 3lb; and 9lb. We won't take you through each proof but - if you wished to weigh 2 pounds, you put a 3lb weight on one side and the 1lb weight on the other, etc., etc.
Today's Question - There is a word of ten letters that means haste or convenient. It can be spelled phonetically with just five letters. What is the word and its phonetic equal?