The Credit Crisis Financial Stocks Short Journal

Hussman on Kudlow
http://www.cnbc.com/id/15840232?video=1534417211&play=1

Says high earnings estimates by analysts correlates with stock market losses

 

Jobless claims not encouraging +13K "Economists had expected claims would fall by 2,000"

 

Greenspan says economic future depends on the stock market
"While ordinarily we’re seeing the stock market driven by economic events, I think it’s more the reverse"
http://noir.bloomberg.com/apps/news?pid=20601110&sid=aVjVyrKBvqyo

Its payback time for the self-fulfilling recovery rally of 2009

 

Greenspan: Consumer spending was held up by stock market capital gains in the upper income earners
http://www.cnbc.com/id/15840232?video=1534915026&play=1

The idea that consumer spending is 'back to normal trend growth' might prove premature once the asset fueled spending boom ends

 

Double dip odds rises. ISM manufac 56.2 vs 59 expected, new orders/production plunge

 

Dollar is getting beaten w/the ugly stick vs. yen, euro, and gbp

 

Its amazing the 2011 H2 ZQ contracts didnt much move up after the dismal ISM and home sales report. To me, they significantly increase the chance of a recession(specially combined with a decline in stock prices). Markets can be quite inefficient sometimes

 

We're speculators, but these are hedgers' markets. Hedgers hedge.

 

I'm not sure. The thing isnt even trading, liquidily low and no volume

 

Just to update some of these options trades. The AUD puts have doubled in 72 hours. My VXX calls have almost tripled in a bit more than a week. Of course, I didn't have serious money invested in them. My point in going over this is not to crow, but to mention that I am becoming quite enamored with options.

Up until the GE calls, I don't think I had ever made an important options trade. I think this has cost me a lot of money over the years. When I think about all I could have made in 07/08 if I had been using options instead of outright positions, I want to crawl into a corner. I was wildly bearish on the GBP from late 07 and was short for most of the next year (short GBP/USD and short GBP/JPY). However, the noise in the markets kept me from holding a really large position. How much more might I have made if, in Nov 2007, I had purchased a boatload of GBP $1.50 puts?

Options are no holy grail, but I think I can do a lot better by making them an important part of my trading.

I am planning on focusing almost exclusively on options for the next few months and see if it improves my performance.