7 Reasons why Criminal Life is Great


Following Wednesday’s Moodys downgrades of Wells Fargo and Bank of America, fresh off the heels of a downgrade of Italian debt on Monday, it was not going to be a good day. The only hope was that maybe our Bernanke led Federal Reserve would pull an incredible rabbit out of its hat and just turn things around.

But for the most part, everyone was just waiting for the anticipated “Operation Twist” and its details before commiting one way or another.

Once those details came from the FOMC, which was uncharacteristically following Obama time for release of its statement, the market didn’t like the description of our current economic state. Maybe it just couldn’t deal with the fact that there were three dissenting votes

In a couple of blinks we went from being up 14 points to down 283.

Just another day at the office, dear. Just a little bit of dissent in the ranks.

Surprisingly, I don’t feel like talking about stocks today, as I took another, largely unhedged pummeling, getting only two call sales made, both on beaten down RIverbed Technolgy, which was probably riding Hewlett Packard’s coat-tails up this afternoon, as Leo Apotheker, its CEO of almost 12 months was rumored to bedismembered by coyotes.

Instead, I need to come clean and this is a good time as any.

It’s not easy saying this, but at some point the truth needs to come out.

No, I’m not a virgin. A game of Twister, years ago, took care of that. And if I was, I don’t think that I would admit it.

But as I sit and really think about it, the criminal life is great. The problem is that I’m not a criminal, but there’s still time to re-invent myself. In a society where so many occupations are disappearing, there will always be criminality. Some things can’t be entirely shipped offshore, even if the Nigerian princes are more authentic 10,000 miles away.

So then there’s the whole credibility issue.

I suppose that everyone is a criminal by some definition. Depends on your society and your own personal values and especially how those values may be at odds with others, especially those with power. The guy who “pied” Rupert Murdoch during the Parliamentary hearings is a criminal, although most people watching the proceedings were probably equally criminal, at least in intent.

Years ago, when Jimmy Carter was running for the Presidency, during a Playboy interview he admitted to having “lusted in his heart”. Nothing really criminal about that, but had he said that 20 years earlier he would have been condemned as a godless pariah and cast to the bottom of the heap with the other low lives.

Even Mother Teresa had her detractors, so much so that some theologians, perhaps of dubious merit themselves, believe that she is consigned to eternal imprisonment in Hell.

As I’ve grown accustomed to sitting on my La-Z-Boy, watching TV and trying to trade stocks and options, I’ve started to wonder whether I’d squandered the first 30 years of my professional life by toeing the line. Working day and and out, not only paying bills on time, but actually paying and other things that now seem so arbitrary.

Growing up in The Bronx, I now realize that the old neighborhood was populated by Mob families. The fathers were always home, were always around to play stickball with their kids and even had their own little coffee shop with blackened windows. The shirts weren’t called “wife-beaters” back then, but I suppose they were.

Plus, the streets were always plowed and they had the best fireworks.

Can anyone say “Winning”?

My Sugar Momma and I have religiously watched COPS for about the last 20 years. Even though neither of us know more than the first line of the theme song, some things have become fairly obvious, besides the fact that some people can garner respect in a wife-beater, while others just can’t and never will.

But what we really learned is that there’s good criminal life and there’s bad criminal life. COPS always portrays the bad criminal life.

Stupid people drinking, fighting, stealing and lying. That’s bad criminal life. They seem to live in pretty squalid kinds of surroundings, have home-made tattoos and wear their pants down to their knees. They’re often very unattractive as well.

Smart people probably stick to just the stealing and lying part although you do catch glimpses of the smart kind that think that they’re smarter than those charged with keeping society safe, if you’re in the habit of  watching Dateline.

Those often commit the bad kind of crime sometimes while in pursuit of the spoils of the good kind of crime.

That’s a bad admixture. You can’t do good by doing bad.

But I now realize that there are lots of good reasons to lead a certain kind of criminal life.

 

1. You make people feel better about themselves

People are so often much too hard on themselves and often suffer from inferiority complexes. Some have the whole thing figured out and just hang out with even more pathetic people to look good by comparison.

Being subjected to the bad kind of criminal activity let’s those with a sense of inferiority know that there is someone even less deserving than they for our world’s limited resources. Unfortunately, that kind of activity is often associated with very unpleasant things.

Like violence.

But being subjected to the good kind of criminal activity spurs aspirations, the need and desire to improve their own lots in life by seeing that there is another way to break the chains. There’s nothing like a good example to spur people on to bigger and better things.

Seeing a hacker profiled on 60 Minutes makes most people believe in themselves.

If that moron could do it, so can I. And I won’t get caught, either.

Not only do you feel better about yourself, but you inject your entire defeatist personna with an air of much needed confidence.

Beyond that, if asked to “forgive” a criminal who has wronged them, what greater feeling can anyone have than the magnanimity to provide grace to those that have fallen?

 

2. There’s no time clock

The only thing you need to keep an eye on is your bank balance. That becomes your internal clock. Don’t feel like playing criminal with your buddies today? No problem, take the day off. Want to sleep in this morning? Guess what? No problem.

Raining outside? Hetl, I’m not getting my new Crocs wet if I don’t have to.

Shower? I don’t need no stinking shower.

Get the idea.

 

3. Society loves a successful white collar criminal

It’s true. They really do, unless they were directly effected. Most people admire the fact that people that can enrich themselves without really breaking a sweat.

The “Why didn’t I think of that” mentality is common to our species. Best of all, seeing just how easily it can be done leads others toward developing even better techniques to separate people from their assets.

That is the basis for how we advance aqs a society. Unfortunately, the Chinese seem to be outdoing us at the moment, especially when it comes to the integrity of the companies that they take public.

But then consider who you admire more? The person that inherited their wealth, the person that made others toil to an awful extreme and under terrible conditions on behalf of their bottom line, or one that just siphons off other people’s money?

Would you rather be America’s next successful white collar crime czar or a tele-marketer? Seriously, which one really belongs in jail?

Wouldn’t you rather see Bernie Madoff putting his skills to good use outside of jail and perhaps just cram 20 telemarketers into his cell instead?

 

4. You feel better about yourself

Not only can you check off “Other” or “Consultant” on those forms that ask about your job industry, but you can also choose any professional degree you like, any annual income and any net worth figure when completing surveys or polls.

Want to feel better than you did yesterday? Forget the Zoloft. No problem, just fill out a new form, maybe get yourself a nice new glitzy business card.

Watching your neighbor leave early in the morning for work and then getting home 12 hours later just reinforces that good feeling. That and the ability to hack into his unprotected wireless network while he’s gone.

 

5. Stronger Family Relationships

Study after study shows that the more time parents can spend with their children during formative years, the better the outcome.

Kids that are able to routinely eat dinner with their parents have been consistently shown to be less likely to abuse drugs or alcohol.

The kids that I grew up with, whose fathers were always at home? No doubt they went into the family business and are passing the lessons learned to their loved ones over a nice plate of pasta and mussels.

 

6. Expanded personal horizons

There’s nothing like a taste of success to move you toward seeking even more success. This is not your typical same old, same old 9 to 5. In the good kind of criminal life there’s incentive to do well and to reach for even greater rewards. As you do so and as your enterprises thrive, along with your professional credibility comes social responsibility.

Patron of the arts, supporter of worthwhile charitable causes and other activities that support society, particularly as government support dwindles, are all part of the successful navigation of a career in good crime.

During the process you also learn things that you never learned in school, including evolving talents to meet the needs of the moment. In no profession does necessity translate into invention quite as efficiently as in a life of crime.

 

7. Improved strategic planning

If you look at the data on retirement planning, it’s clear that we as Americans have no clue how to plan for the future.

Choose a life of crime and strategic planning becomes your middle name. Escape routes, alibis, Plan B, and so many more considerations before executing a plan. In essence, everything you do is lived out as if a three dimensional spreadsheet.

Those unprepared to deal with strategic planning are doomed to failure and may as well just work for a living.

 

These 7 reasons alone are compelling enough to get most people to start on their road toward change.

I haven’t even mentioned the popular trickle down theory and how all of society benefits from your creation of personal wealth. Money and the time to enjoy spending it benefits all of us. Restaurants, department stores, pasta and mussels delivery boy. Everyone gets their piece.

Beyond the obvious reasons to consider re-inventing yourself are purely financial incentives that are more than just icing on the cake.

Anyone that’s had a workplace 401k knows just how bad those are and how limited the investment choices can be. Together with contribution limitations, there’s no denying that the self-employment tax deferred plans are so much more favorable.

Of course the ability to itemize your business related tax deductions are only limited by your imagination.

Need well manicured nails to stay at the top of your safecracker game? Simply take you deduction on the clippers and file. Panty hose over your head? Deductible.

Where do I sign up?

Since this blog is required reading in many elementary school classrooms, I want to be certain that it’s clear that I’m not exhorting anyone to a life of “bad crime”, but serious thought should be given to being the best you can be at the “good” kind of crime.

It’s never too early to begin plotting your life of future plotting.

Now if only there was a way to have all of these benefits without the liability of prison.

How great would that be?

Wishful thinking.

By the way, what’s your PIN, again?.

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Selling a Kidney for Crack





 


 


I know that my short term memory is degraded, but I still remember what 2008 was like. It wasn’t very good.


Even if I didn’t remember, I could just dig up an old spreadsheet or look through my Quicken archives and would be reminded of the pain.


Every now and then, even though I don’t pay too much attention to stock charts, I’ll pull up 5 year charts just to see how low we coud sink when times get tough.


Stocks, like people, can sink to unimaginable depths.


Luckily, and totally serendipitously, that was the time that I started a strategy of aggressively selling covered call options and sticking to a relatively tightly controlled universe of stocks, so the pain wasn’t as bad as it could have been. Always solid companies, never any speculative plays.


I’ve always thought of speculative stocks as being Zombies that could come back and devour its master if guard was ever let down.


Back then, though, I also worked for a living and actually made lots of money. In fact, by my estimation obscene amounts, particularly relative to my actual degree of effort.


I like to think of it in mathematical terms, except I’m reminded that the divisor can never be “zero”.


Now, I sit and try to generate income from my holdings by selling and re-selling call options on the portfolio’s holdings. It’s been a really good alternative to the alternative.


As each monthly cycle begins I find myself in an optimistic frame of mind.


This past week, the beginning of the October cycle was no different. In fact, if anything, I was even more optimisitc after coming off an absolutely stunningly good last week of the September cycle.


During that week the market fought back from early day losses on a couple of days and rallied on other days in the face of no news, or even bad news.


Does it get any more bullish than that? Even more so when the markets appeared oversold in previous weeks. Like that wound up coil some people like to use in their attempts at imagery.


Funny how things work out.  I questioned my own sanity based upon last Friday’s rally going into the weekend. There were so many open questions remaining in Europe, I never did understand where the optimism was coming from. Despite that, I was still looking forward to a great month coming and lots of new options income.


Did I mention “funny how things work out?”


Despite the terrible market in 2008, I never felt any desperation, even on a day when I may have lost the equivalent of 200 Color TV’s (using 1964 Color TV Index).on paper. Having a job and employment income was probably a factor in maintaining a calm demeanor.


A few weeks ago, on the day the NYSE commemorated the tenth anniversary of the September 11th attacks, we had a 300 point drop, yet it was just an ordinary day as far as drops go. No stress and no worries.


Yesterday and Wednesday had very different feels to them. Sometimes it’s not just about the magnitude, sometimes there’s a qualitatively different feeling. Yesterday, in fact, it was the FOMC report, that led me to believe that they need to measure their words more carefully and perhaps consider “qualitative easing” for a change.


Adjectives can be really hurtful.


Gloom. That’s the feeling. The same kind of feeling back in February 2009, which was the last time we’d had a week like this. It was just a couple of weeks later thatthe “Haines’ Bottom” was called.


I actually shuddered to look at my largely unhedged positions today. Were it not for the plummet in silver and the subsequent rise in the ProShares UltraShort Silver ETF, which slowly has come to be about 9% of my portfolio, there really would have been some frightening numbers .


I actually have images of the short silver ETF’s being my portfolio savior, if we can shave another $3-4 off the price of the metal.


And I don’t really believe in saviors, but am willing to accept delivery from my misery. When I’m knocking on the door, I’ll take all rites.


Just another form of hedging, that’s all.


Unhedged, those shares were really easing the pain. Seems appropriate, as silver is also the antidote to a Zombie attack when forcefully thrust.


But one week into this 5 week options cycle, I was so woefully unhedged that the blows were all full body and the options premium income was much lower than I typically expect. Considering that September was the second worst income month of the year, I was feeling the pinch.


Crack, baby, CrackThe other night we were watching some show on the National Geographic channel about cocaine. They profiled a Chicago addict who was going through a couple of hundred dollars each day.


Sugar Momma and I both wondered where he was getting the money from and then we found out, even though we both had a clue.


It was from that bad kind of crime that I covered in Wednesday’s blog “7 Reasons Why Criminal Life is Great“.


But sometimes you do what needs to be done. When faced with your personal stress test you do things that you may not be proud of.


So I looked at my babies and I do love them all and wondered which ones to sacrifice in order to generate some income.


Unfortunately, there weren’t any really good prospects. In fact, the only promising position was the UltraShort Silver ETF. Just about everything else was deeply in the red.


Loving all of them equally, but loving the ETF most, it was a difficult decision, but Daddy needed some money.


Sigh. Like an addict going after that crack rock, I sold call options on about 30% of my ETF’s. Almost like Abraham ready to sacrifice Isaac for a chance at the unknown.


However, instead of selling in the money or near the money calls, I sold the October 2011 $17 options, at a time when the ETF had already been up about $1.80 to $14.40


Sort of like Abraham using a magician’s trick sword.


I’ve been confident that the metals would realize that gravity was an important contender and haven’t been selling the covered calls in anticipation of that realization.


Until now.


I just needed that fix. It really did feel like selling your last remaining kidney for just one last crack rock.


Self-respect is pretty unimportant.


Dennis Gartman, that ubiquitous CNBC contributor must feel the same way, as he told people to “go out on the street and raise cash”.


I think he was exhorting people to panhandle. I don’t think Mayor Bloomberg is going to be a fan of that strategy. But at least that clears up the question of why Gartman spit on my windshield yesterday morning as I exited the Holland Tunnel.


To his credit, he was the only one out there with a magnetic credit card reader and a Skype connection.


Personally, despite my desperation, I am still the guardian of my dignity and would sooner sell apples or jump out my first floor window.


For a brief moment there was a 100 point climb off the lows when a FInancial Times report was misinterpreted. When the realization came that the report indicated that the European banks needed capitalization yesterday, those 100 points were gone in a flash.


I did take that opportunity to close out sold call option contracts on Transocean and DuPont, in anticipation of some kind of a bounce.


That may be overly optimisitc, as I don’t expect the same kind of week closing rally as we had last week.


But at least I didn’t take it quite to the lengths of the Greek banks.


The fact that Greek banks were offering lakeside villas for every new account deposit in excess of 50 Euros was not likely to create the kind of extra capital hordes that would be necessary to forestall collapse.


Can you imagine the size of the crack rock that it would take for Greece to pass that stress test?


Interestingly, the Greek banks may be in better shape than our very own Bank of America, where a new account deposit of $50 now gets you a major equity position, as shares have now fallen to a new all-time low point.


Moynihan, stop bogarting that crack pipe.


As bad as today was and as regrettable as the actions were, extending the metaphor, at least I can grow a kidney back.


We’ve all done it before and will likely all do it again.


 





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Twister

The Federal Reserve is said to be ready to announce the implementation of “Operation Twist” some time on Wednesday.

Fueling speculation that something big was brewing, former Federal Reserve Chairman Greenspan was seen entering the building, albeit with Elvis. AS it turns out, he was there for a haircut and sometimes a haircut is just a haircut.

Ultimately, by exchanging its short term portfolio of holdings for longer range debt instruments “Operation Twist” is hoped to bend the yield curve.

Although I’ve seen the visuals many times over the years and can probably understand the concept behind “inverted yield curves”, it’s like “contango”. I know what it means, or at least am capable, but due to my disinterest in the topic, I choose to not clutter my mind with the meanings of those terms and phrases. I can’t begin to tell you how many times I’ve actually looked up the definition of “contango”, yet it still has never taken root. It’s almost as if the my future memory bank is more highly respected than its current state would give it the right to be.

Contango. The word itself brings giggles to mind. I just can’t remember why. 

In an earlier blog, I admitted that “I don’t understand currencies“. I can just as easily say the same thing about debt instruments and bonds. I’ve never really tried to understand this very important aspect of investing. Sometimes its hard to know whether my disinterest in bonds and currencies comes from lack of intellect or just true lack of interest, as I perceive them as intangible and somewhat boring. I don’t worship at the feet of the PIMCO altar and I don’t find stamp collecting all that exciting.

I know that they are anything but, yet I can’t find anything persuassive about them to garner even faint interest. But there is probably hope, because last night I watched the premier episode of the new “Two and a Half Men”, never having been interested in the original version.

This “Operation Twister” though, has caught my interest.

During Jim Cramer’s interview of Treasury Secretary Tim Giethner last week, Cramer asked why such a strategy wasn’t being pursued. taking advanytage of historically low interest rates. At that point, the clever name hadn’t been publicly applied. It was just another conceptual approach to managing debt and markets and really meant nothing to me.

Cramer then seemed genuinely surprised and for a brief second seemed to be speechless as Geithner indicated that such a strategy might actually find its way into the arsenal.

You neither see that, nor the resultant silence from Cramer on very many occasions. It’s true when they say that silence speaks volumes.

The concept does seem to make sense, as long as there are buyers for the long term notes, but yet, it’s an untested strategy, at a time when the Federal Reserve seems to be running out of things in its quiver.

The problem with most ideas, whether they are economic issues or otherwise, is the occurence of unexpected consequences.

No one really knows what will happen if the yield curve is drastically altered. Certainly, no one buying a 30 or 40 year note has any clue as to what the rate environment will be at that time, much less next year. Hell, you don’t even know who the lead in Two and a Half Men is going to be.

I know that I wouldn’t be investing in a 30 year note during a period of all-time low interest rates.

Now flip the scene, and make believe that it’s 1979 and interest rates are 17%, then I might have a different opinion on locking into those kind of rates.

My attraction to Operation Twister may be solely related to its namesake, the game “Twister”, which made its debut during my childhood.

Talk about unintended consequences.

I think my first sexual encounter may have been on a spin of blue, but it’s difficult to say who exactly the reciprocal party was.

Although “Don’t Ask, Don’t Tell” has officially gone into the sunset, I might be inclined to invoke it for that long ago game of Twister.

Since I don’t really understand the world of interest rates, I have no idea what the unexpected consequences might be, but drawing from the game, collapse is the end game.

Collapse is exactly what seemed to happen today and turned a 150 point gain into one 140 points less.

Instead of selling lots of call contracts as I had envisioned, I only sold a few and added to my shares of the ProShares UltraShort Silver ETF and Riverbed Technology.

From my perspective, there never was a 150 point gain, as I had one of the worst days ever, compared to the indices. It didn’t help that I was now more heavily reliant on the likes of Freeport McMoran and Mosaic than ever before.

The source of the collapse was said to be “The Troika” and its inability to come to some agreement that would have released the $8 billion traunche that Greece needed to help it further into the hole as it prepares for its inevitable default.

You know, the one that everyone seems to be happily ignoring because that can is maybe as far as 3 months down the road.

The so called “Troika” consists of the IMF, the EU and the European Central Bank. They hold the cards, but apparently can’t decide whether to deal in a clockwise or countere-clockwise direction.

As Operation Twister comes into play, some Troika members may regret treating Treasury Secretary Geithner so shabbily during his vist to their recent meeting in Poland. They could have listened to his wise and sagely advice and could have switched over to a spinner and let the cards fall where they may, as they could then watch the arrow determine Greek’s destiny.

Ultimately, it doesn’t matter whether you spin the wheel clockwise or counter-clockwise, so certain areas of dissent are immediately resolved.

The groundrules could be very simple and definitions readily agreed to.

Blue for no more government hiring

Red for increased retirement age and so on. They may even want to throw in that taxes should not just be levied, but they should be collected, as well.

But no matter what, every game of Twister does end the same. I don’t remember whether there was a “winning” scenario. Surely Twister was first popular long before Charlie Sheen, but even then the concept of “winning” must have existed.

Instead, every game ended with the inevitable collapse accompanied with lots of laughs and the feigning of embarrassment by some.

Some actually reached their peak maturity level in the pile.

In this case, I don’t think there’ll be any laughing. I doubt that there’ll be any embarrassment either, as certain egos, particularly those associated with politically appointed positions, don’t allow public displays of embarrassment.

They do allow for finger pointing, though.

No matter what, those fingers will probably point in our direction, as undoubtedly our banking crisis just greased the pole for southern Europe and Iceland, Ireland and others, as well.

Ultimately, only a winner take all game of Twister will be able to sort it out at the highest levels.

A repeat of the Berlusconi – Hillary Clinton match would be interesting. It’s just so unfortunate that Dominique Strauss-Kahn can no longer suit up (or down) in preparation for game match. You could probably get enough people to pay good money to see him in a good healthy game of full contact Twister to make a dent in the EU economic mess.

Happy to help.

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Fear of Missing Out





 


 


In polite company, you never refer to behavior as “dumb”. Instead, it’s simply inappropriate or unexplainable. Just like really wealthy people are never crazy. They’re eccentric.


There are lots of reasons for unexplainable behavior, that’s why they’re really not “unexplainable”. They’re just dumb.


If you watch shows like “Dateline” often enough, you’ve seen every bizarre act and the reasoning behind the act. You’ve also learned that there’s never a shortage of unexplainable behavior.


Television ratings seem to do particularly well when the reason behind the action is passion. When it comes to motives, greed is also a big favorite in the  gawker community.


We like hearing stories that have greed as an underlying factor.


Murder for insurance money is very popular, especially if unrequited passion was also involved. How great is it to watch an episode about a wife that allegedly killed her husband for the insurance money so that she and the cabana boy could retire to the Dominican Republic?


Greed is also a big factor in investing. People do really stupid things because of greed. But greed is nothing more than great passion for money or other items of value.


Everybody’s heard the axiom that “bulls and bears both make money, but pigs get slaughtered”, but when it comes to battling with human nature, axioms don’t stand a chance. It’s a lot easier to spout them than to heed them.


Another investing axiom, although not encased in such a short memorable saying, is that you don’t stay long going into the weekend if there’s uncertainty in the mix.


This past weekend was one of those that you would have expected smart investors to have been on the sidelines.


After all, the previous week saw gains every day, even though some of those came in the very last hour of trading. The rally was fueled by speculation that the European Union was closing in on at least a short term solution to averting a Greek default.


Stocks climbed and precious metals took big dives.


But on this Friday, one of those quadruple witching Fridays, even in the face of unsettling news on the EU front, th e market still went higher.


In the last hour of trading on Friday I posted on Twitter questioning my intelligence, as I would have expected a sell-off heading into the weekend. Least of all, the bad news that went counter to the rumors and hope should have put a damper on things. Add to that the 5 straight days of gains and it would seem that profit taking would be in the cards.


Sure, maybe the smart guys took their profits on Friday, but I sort of doubt it. Who then was behind what happened on Monday? Definitely not the little guys like me.


Of course, I had a vested interest in seeing some profit taking, as I stood to lose nearly 50% of my holdings to assignment unless the market reversed course.


It didn’t.


FOMOAs I wondered why it didn’t do the obvious, I learned of a new psychiatric disorder called FOMO – Fear of Missing Out.


It actually refers to the need to be constantly plugged into social media. It helps to explain why people would risk their lives to text a meaningless message while driving. It also explains why I kept breaking into a cold sweat on Monday as it was again one of those infrequent days that I had to work outside of the house.


Bad enough that I was cut off from CNBC, but Twitter was nowhere near as ubiquitous as its become in my normal life. The need to responsibly attend to work saw to that.


All I knew was that the market opened down around 250 points.


From my perspective that was what I’d been hoping for. It gave me a chance to buy back shares of British Petroleum, Textron, Dow Chemical, DuPont and Triple Q’s at less than they had been assigned to me.


But why did the market go up on Friday when it seemed so obvious that it should have done just the opposite?


FOMO.


Fear of missing out on more irrational upward price movements. Given that most of last weeks’ price increases were based on rumor and hope, what reason would anyone have had to actually go against the flow? History and common sense were no match for unexplained price action. Axioms were meaningless when there was still the prospect of more inappropriate price climbs.


In this context FOMO is greed.


Otherwise smart people fall prey to FOMO all the time. I suppose that it’s really a normal reaction. I feel it every time I sell shares or every time I decide to buy shares in one company and not another.I definitely felt it Monday morning as I went on a wild shopping spree in the first 30 minutes of trading and then wondered whether I missed out on even better bargains because I didn’t wait longer to blow through the money.


It’s hard to imagine yourself being the only one with nothing to party about, so yougive in to the FOMO.


This morning I’m back at my usual perch and will be so for another month.


Twitter and CNBC will be fully engaged. I won’t miss out on a single opportunity to say something irrelevant in 140 spaces or less.


In the meantime, as the market reversed much of its downward trend in the last hour of trading on Monday I decided not to sell any call options.


Yet.


But I have no FOMO.


There’ll be plenty more opportunities to miss out on and there’ll never be a shortage of them, either.


Tweets and texts come and go but FOMO is here to stay.


 


 


 


 


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Trading Places



Here it is, Sunday afternoon.


Watching football, having already gotten my week’s fill of cholesterol in just one night and feeling pretty good.


Trading PlacesWhenever I hear that phrase. “Feeling good”, I always think of that great Eddie Murphy – Dan Aykroyd film, “Trading Places.”


I can just hear the lines: “Looking Good, Biily Ray!” and in response,  “”Feeling good, Louis”.


And what’s not to feel good about? After all, Eddie Murphy is trading frequenting transvestite hookers for hosting the Academy Awards.


Life really is good.


And it’s especially looking good for the United States, at least as far as our emotionally beaten down egos are concerned.


After a few years of the world thumbing its nose at us and deriding us for our dysfunctional political system and profligacy, it now seems that we’ve traded places with Europe.


On top of that word has just come out that Dominique Strauss-Kahn has admitted a “moral failing” with regard to his tryst with the hotel maid. As a result we may not need to feel terribly badly about an injustice being done to the ex-IMF leader and may be shielded from some overseas criticism of our justice system jumping to conclusions.


Imagine, it’s been a few hundred years and they still can’t cope with the little squirt of a brother growing up.


Not that I had felt terribly badly, anyway and not that things are running along entirely smootlhy on this side of the Atlantic. With the exception of baby kidnappings and other trampling of human rights, things still seem to be better with our Chinese “friends”, who gve us a market lifting gift just by being part of the rumor that they might purchase Italian debt instruments.


I hope the Italians do better with the Chinese than they do with me.


I just received 5 mailings regarding traffic violations from a trip to Italy 3 years ago.


That was the same trip that the car rental agency tried to hit me with a $2,500 charge for damages.


Oh those whacky Italians. Wouldn’t trade the experiences for anything.


But watching economic events in Europe unfold is the true definition of “schadenfreude.” It’s one thing to have the twp predominant political parties in the US act in a dysfunctional manner, buut when you have the EU’s 27 member states trying to figure out how to divide the bill and who deserves how much vacation, you’re talking some real dysfunction.


At least they’re all agreed on retirement age and loan collateral.


It was funny hearing Treaury Secretary Geithner characterize his trip to Poland for the EU Finance Ministers meeting to be on the basis of an invitation, particularly since all news outlets reported that his “hosts” greeted him rather cooly.


European Finance Ministers apparently don’t like to be told how to run their economies by a guy sipping directly from a box of red wine while dining on trout meuniere in his ripped boxers.


That may be a bit of an exaggeration, but so far I haven’t seen or heard anything to contradict that characterization of events, so I’ll stick with it. Given what could have happened on Geithner’s watch and what didn’t happen, maybe they should try the red wine instead of the Kool-Aid.


So with all of that as a backdrop, last week was a great week. Stocks traded places with precious metals. I own stocks and am short precious metals, so iy was a great week.


Surprisingly, perhaps surprisingly only for me, Friday was yet another up day in the markets given that there really wasn’t any encouraging news coming out of Europe. In fact, if anything, even though the news raised prospects of a breakdown in the agreements necessary to temporarily rescue Greece, our markets shrugged it off.


Gold and silver on the other hand reacted precisely the way you would have expected in the face of uncertainty and the potential for a Greek default heightened. Earlier in the week, they also reacted according to script and had dramatic moves downward as an agreement appeared to be in the works.


No matter, so what if people felt confident going into the weekend holding large positions?


But I was happy.


Most of all and best of all, for me, a devoted call contract seller, Monday starts the October options cycle.


In that regard, September was nothing to remember. It was the second worst option premium month this year, fresh on the heels of the second best options month I’d ever had. Still, using my patented 1964 Color TV metric, I needed to find room for 39 new TV’s.


But as a good sign, despite the feeble option income stream for the Septmber cycle,  I’ll have plenty of opportunity to redeploy funds form assignments. Almost half of my holdings will be turned over, with most of them closing Friday within 1% of their strike prices.


When that happens, I love to see a down open on the first Monday of the cycle. There’s nothing better than getting those same shares back at less than their previous strike prices. But beyond that, there’s nothing like selling call options during a market peak. Grab those higher premiums, then close the lopp and start again.


I lost portions of my Bank of New York, Textron, Dow Chemical, DuPont, Williams Sonoma, British Petroeum, Deere, Home Depot and Transocean shares


If the past is any indicator, I’ll probably end up getting some of those shares back.while I also look at opportunities in Sallie Mae, Mosaic, SPDR 500 and adding to poisitions in JP Morgan and Chesapeake Energy.


With that much to spend, I’ll try to control my investing equivalent of premature ejaculation, but that’s always been difficult.


I was going to say “but that hasn’t always been hard,” but then it would have been unclear whether I was referring to investing behavior or the metaphoric equivalent.


On a sad note, I’ll be working tomorrow.


But that sadness is quickly replaced with the knowledge that I have only 2 more work days scheduled in 2011.


The work thing tomorrow does potentially interfere with the trading thing, but I’ve never let responsibility get in the way before, so I don’t really think I’ll be starting tomorrow. It may, however, help control the need to spend by keeping me otherwise occupied.


But still, that possibility is tempered by the fact that if I had to work, it couldn’t be for a better cause. I’ll be trading places with my friend tomorrow, who is on a golfing trip with his father.


I’d love to have the chance to have one of those trips with Szelhamos, but then I’m reminded that the most athletic thing I’d ever see him do was to bpwl one time.


As an 8 or 9 year old, I don’t think I’d ever seen anyone roll the ball as fast and ghard as he did and barely ever hit a pin.


Still wouldn’t trade that memory for all of the perfect 300 games on China.


 


 


 






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