I missed the last hour of the trading day and was just wondering what happened right before the VIX went due north at 14:27 central time.

I see that the computers "discovered" a price where more "liquidity" could be made... I probably don't need to show what happened right after this flock of orders. Joe Sixpacks 1-10 contracts (or whatever) vs Juarassic Sparc's 300-1400 contracts. I'm filtering time and sales > 300 /ES contracts (~$1.2M notional, but market maker margined of course). I will acknowledge you are not getting to see the 1,5,10 size orders in between but I'm trying to make a point damnit! :) How many "humans" you think might have bought into that only to get SPARC'd by algo's as the /ES goes from 990 down to 982 by close of regular trading.

Presented without comment except for clarification of what an indicator is doing.

The above is just looking at ADV/DECL and volume. Nothing fancy.

I lost my labels on the last chart but it's a daily TICK with a kaleidoscope of moving averages and the same ol' oscillator under it. Again, nothing fancy.

This is what happens when China diversifies and starts stockpiling commodities. The bobbleheads are sure going to point this out and how it's signaling the start of a new bull market. I personally consider this a blow-off top with negative divergences. Who knows how long it can last though. The scary thing is as far as I can tell the nearest pivot is at 2.91'ish.

Random blather of the day

Kneale is being clever in that he's calling for the 'end of the recession' and predicting those 'mean spirited bloggers (a/k/a Digital Dickweeds)' will take issue with that. No one is taking issue with that directly but instead are pointing to a "Jobless Recovery" and how the data suggests we will be right back into another recession soon (and also pointing out that he is clueless). Whatever NBER declares on their charts is irrelevant. Hell for all we know Kneale got some 411 from his TARP producer, that came from the GE head honcho by way of Barney Frank and Goldman. It takes a 2.0-2.5% GDP growth to sustain the current employment rate (I think in China it's 5% to sustain the population). Think on that one a minute or two then add in the debt overhang. Also note the Depression was not really felt until the second dip when misguided policy sent them into a deflationary spiral.

[addendum] Here is more price discovery and liquidity today. Heisman maneuver can only be pulled off during good news.

Posted wrong chart earlier

Now that the EURO has blasted off against the Wampum.... It's not a foregone conclusion but that 'smaller leg down' is a possibility. I would like to see what 78.50 in the DXY brings first before drawing any short-term conclusions. I think any move down will be short lived unless 'Tanke really eff's up. Its a day-by-day thing now.

[addendum] Although some of the commodity related names sure act like they want to release upward for a blow-off top. But a blow-off top can last for days or a couple weeks. Who really knows. Probably until oil reaches Goldman's price target and all the banks can dump that oil back on the market for a few billion in profit. Hmm...I'm supposed to be taking a break.

[addendum] Wonder how much profit the banks made in the recent moves in the long bond? You don't think they were not positioned accordingly do you (in FX as well)? Guaranteed you're being sold into across all assets during this synchronized release of "news". The unwind might take a while.

Patience can be rewarding at times. Just an update that AMED is nearing the 42.50 target price (41). Not sure how much more it has left in the short-term though. If it does reach that $45 I'll be breakdancing like Turbo and Ozone in Breakin' 2 Electric Boogaloo... [addendum: buying protection right here, can't be foolish. I'm not certain this isn't the end of the road.] ``Sell your losers and let your winners ride...'' It's not about the success rate in your picks. It's about the profit factor. I'll take 0.500 success rate and a 2.0 profit factor every day of the week.

This is a huge winner for me (options) even with the wasted protection. Might be time for a little Breakin' away from the markets... There are usually two cycles for the trader: The Payout and the Payback cycles. Identify the areas where you are most prone to enter the 'payback' cycle and you will increase your P/L. Having "basic" knowledge of E-wave has helped me identify those spots.

I just tried doing the worm and my voice is a little high-pitched right now. So instead I'm going to watch the video. I'm still not quite sure why I watched this movie growing up...Check out Kelly's digs.

---

Random chart du jour.

[addendum] EFA is a no go for now. It's acting like it's targetting 52. Therefore I must wait.

For the last week or so I've paid close attention to the futures from normal market closing up until futures close (15 minutes after). Each and every day you see the futures getting "worked" and the obvious working starts at 10 after when we see a last minute buyer (14 mins after closing bell) come in with a handful of >300 block /ES trades pushing it up sometimes 3 points to have it land right on a "number". I've seen it at 950, 975 (multiple times) as well as 980 (have several screenshots over the days).

Well today was the first day I haven't seen this buying activity in the last 2 minutes of regular trading and there was no such mysterious buyer before futures closed. In fact, in the last 4 minutes of futures trading (not shown below) there were 2000 /ES sold across 4 trades. Perhaps these were just computer offloads from a bunch of smaller sells it took right before that, but I don't think so.

The most eye-catching thing I saw was a complete polar opposite of what previous days had shown in the last seconds of regular trading. Did Trader X have to close out? What changed at the close today that stopped the mass buying all of the sudden? I'm just citing "observations" so do not mistake this as a burned short or anything like that (go read the last 100+ posts). It's just that I loathe liars, cheats and thieves. Since I've been trying to record the closes (up until futures close) each day I've just noticed certain patterns. I'm not suggesting you draw any conclusions about tomorrow's trading based on this screenshot (it would not surprise me though...tomorrow being the advance gdp numbers). We call this "liquidity" and "price discovery". In 4 seconds the computers discovered a new price for the market and took your liquidity before you could blink.

Today

Does Team SLP tweet? Can someone hax0r into their box and see if they turned off the spyGunner cronjob? Here was a nice flock of buys coming in the last minute of futures yesterday. You know, before today's run up to 995 (as I watched the SRS traders get SPARC'd). Source these trades...

On a different note, as long as the CME allows flash orders the rest of the indexes can be worked sort of. It's where a lot of the bullying takes place.

[Addendum] Euro no play ball today despite the commodity stocks blasting off (DXY was down but noting the under-performance of the Euro) . I don't think Trader X had enough funds in his FX account to move it. Will want to monitor that before I declare the reflation trade a "go". One day a trend does not make. This means I did not bail out of EWZ yet. It's rare that I react to something during the day until I can understand what the catylst was. If I wasn't prepared for today, yesterday, then there is no way I will be able to make an informed decision based on a CNBC breaking news banner.

For some reason I get the feeling we will hear some news soon that will capitulate the market to the upside (futures already at 982, maybe I missed the news...Listening to shoutcast groove salad). Not sure if this news will be GDP related or a dollar smashing announcement (the HUI and corn charts would support this scenario). You heard Fauxbama talking about the end of the recession as well as the coordinated campaign promoting the same sentiment. The goal is to use confidence to change the laws of mathematics. It might work for a little while.

Tread carefully here. Being overbought means nothing... Be a trader first and an economist after the bell. If you force your bias on the market then you will meet Jurassic Sparc. Even after the recent melt-up it still feels "trappy". I also noticed the /NK stalled at 10k but has since lifted off.

If we are said to be out of a recession soon (possible) then you can expect another longer, deeper recession to follow. It will look somewhat like a 'W' except if you hang about elevent trillion in debt on the right leg of the W until it breaks off into a sideways hell.

[addendum] For this reason I'm not too confident in the EWZ trade (56/53 put spread). I will drop it like a bad habit if the reflation trade kicks in. For now it's still a wait and see approach.

If I were a psychic it would go something like this (bullish case). If I had the power of GE/CNBC/Cramer I could make this happen. Bearish case is 275

What in the hell were we thinking? I was hoping to see some leg warmers in the crowd.

[Addendum] Keep an eye on "Newman". If it closes above 161 or gets above 163 then perhaps things are about to go higher? 161 is a pivot for GS with 151 the next level of support.

Updated Chart, left out one trendline.

If the reflation trade does come back not only will my EWZ trade be blown to bits but perhaps corn will catch a bid. Just a trade idea. A counter-trend trade at that. I do not mind these spots because I know where I stand in the trade pretty quick. If it does I'll be looking to take a stab here.

Patience can be rewarding at times. Just an update that AMED is nearing the 42.50 target price (41). Not sure how much more it has left in the short-term though. If it does reach that $45 I'll be breakdancing like Turbo and Ozone in Breakin' 2 Electric Boogaloo... [addendum: buying protection right here, can't be foolish. I'm not certain this isn't the end of the road.] ``Sell your losers and let your winners ride...'' It's not about the success rate in your picks. It's about the profit factor. I'll take 0.500 success rate and a 2.0 profit factor every day of the week.

Deutsche Tank left without me (so far). Guess those earnings weren't SPARCtacular.

If the Euro starts to weaken look at the XLK for a possible short. Would want to see how these auctions go first and how it might impact the US Wampum.

Watch out for whipsaws at the SPARC attack locations.

Looks like the SRS flippers have helped to recapitalize the banks. No guarantee it even stops there but it looks better from up here than it did at $29. It is getting over-extended in the short-term and might see a pullback to the 32-33 area. It really depends on when Newman wants to take profit. See also: Mish in 'Bernanke Terrified Over Commercial Real Estate, Seeks Still More Power Over Consumer'. Still waiting...

[Addendum] Also above that line is 36-38 in the event there is more exuberance over the possibility the Fed gets involved in CRE. This is fun to watch. This video is not.

And now they are singing

This could be two possible SLP Sparc attack locations. I've got about 1/5th the total puts I'd like to have. I have patience and am not setting up for a cliff dive. There is of course the almighty 1050 that is still a target above those numbers. Should it go there? No. Will it? That's not up to me.

You scratch my back and I'll scratch yours...

Congress will never pass another bailout bill after this debacle and most know this. When they try it will be because "A fragile banking system will undermine a recovery and we are oh soooo close it would be foolish to let off the gas now". This is why we've seen conduits such as AIG/Fannie/Freddie to be kept afloat. Paulson authored TARP 1.0 on four pages (probably double-spaced). It fails to pass. Paulson/Bernanke pull $100B in liquidity creating a panic in the money markets. Paulson/Bernanke pull some members of congress to inform them that we will not have an economy come Monday if this bill does not get passed. Frank works overtime loading up the bill with pork barrel amendments (probably written by those who opposed the bill) and those taxpayer protections. He, along with Pelosi, were the ones urging congress to pass this. Frank wanted taxpayer protections and congressional oversight on how it's being used. Frank likes to do housing entitlements, which is what he thought he was going to get. Bernanke wants the power to oversee everything (read: backstop the banks without review). Geithner gives the nod to Bernanke. Frank gives the nod by allowing TARP to be recycled over and over to further his housing agenda and stalling a bill to audit the Fed.

We get no taxpayer protections, no congressional oversight and money that is continuously being recycled in TARP. We ask for an audit of the Federal Reserve and Frank says he will "give it a look". The same guy who was claiming taxpayer protections and oversight on how the TARP funds were being put to use is now stalling and shows no enthusiasm over this bill. Birds of a feather flock together... All we want to do is have a look at the books and see where our $24T went. Being afraid it will impact interest rates only tells us that what's on the books isn't pretty... It would also prevent them from using TARP to bail out States, and we can't have that!

Bernanke <-> Geithner <-> Frank + majority = Slam dunk Game over man.

Why can't we vote this assclown out of his position (on the right side of the picture) as the Chairman of the House Financial Services Committee? There is plenty of blame to go around both parties but Frank is both stonewalling and inhibiting good legislation to further his own agenda. At what point is gross negligence/incompetence considered? The funnel of authority breeds corruption and the taxpayers are not in their best interests.

Once the malfeasance and misfeasance have been exposed Americans will write-off both parties like some AAA rated tranche of Detroit sub-prime. The next president will be an Independent.

Links (These are not the actual titles)

Frank says, "Thanks! I owe you one."

Frank goes "Green" and recycles TARP

Frank had a possible conflict of interest
Former aid to Frank goes to Goldman

Frank and Pelosi urge GM bailout

Frank is in no way involved going back to 1992

I have much respect for Dylan Ratigan. This is the reporting I want to see. He calls it like he sees it, just like I do. I imagine the rift within CNBC began about 32 seconds after he finished obliterating that ratings agency dude who were slapping AAAAAAAAA+ ratings on packaged poop (sold by Newman, insured by AIG).

When you tell the truth on CNBC that is what happens. The "balanced" reporting comes in the form of a scripted Santelli rant (Btw Santelli, get off that network for the love of God. Just speak your mind one time and they'll shitcan you).

Ratigan and Ritholtz Show? Might not be able to compete with the "Kneale and Bob Show" though. I do not know this Durden character (in real life, I know the movie character) nor have I had correspondence with him/her. But my "gut indicator" is telling me that "Digital Dickweed" stunt was a huge blunder and probably was the nail in the coffin for that network or his job at the very least. It was downright appalling.

Open Call [edit weird, jinx!!! (but much better written) my brain just blue screened)]

I'm trying to spread the love around to the other networks. Whichever network establishes them self as the network who regularly presents unmolested data, facts and other "not-so-green-shooty" information will forever gain the respect of viewers for the next decade and more. You will more than likely face political pressure and be considered "negative nancys" at first. America is starting to wake up... but there are still people wondering why there aren't more people pissed off. That's simply because of the limited audience that is being reached (blogs). Until the "unbiased" data is presented on a consistent basis, Little Tea Parties will stay little and you will cling to "hope and fortitude" while you stand by and watch this absolute disaster take place. There are several "bloggers" who would love to present this data on your show (not me).

If any network wants to solidify this position, now is the time.

In stock news, heads up on SO. I have no position in it now...just a warning you might want to put on a chastity belt just in case...Not a call but it is putting in negative divergences now. I'm not interested in trying to top/bottom tick trades. There are other blogs out there for you that can do that.

[addendum: If you do not realize the stealth tax being done in the markets by positioning the banks on the right side of the trades then you are going to feel "violated" if you are buying into the propoganda channel and the coordinated government hype in the media. I've stated previously that I felt the Gov has realized there is a huge piggy bank...the Market. And they are telling you everything is a-ok while they are doing it. Does your ankles look like hand-grips or what?]

[Update 1 (closing bell): 30+ mins of video captured today (up until futures closed), annotated in real-time, 1 take. This is getting good]

I have two problems now:

1. Durden pulled out Johnny 5 and I was saving a post to bring back that old school character. Not anymore.
2. Denninger explains the flash order concepts before I could do it with the video. This is a good thing because I am to explaining what Jim Rogers is to timing the market. "Hell Betty, I don't know. I'm the worst market timer. Why don't you ask the other guys on Bloomberg". Anyway, this makes it easier for me to illustrate what he said with the video. This is why I asked for readers to see that other article and give it proper thought before coming back for a video I have yet to put out.

In other news, after hearing of the recent intervention in the Swiss Franc legendary investor George Soros' heart rate spiked to fifty-seven beats per minute and was last seen buying up every franc in existence. The Rodney Dangerfield impersonation tour has been put on hold until he can take down the central bank.

Be careful in this market. I see all kinds of traps. I think I'm going to blather for a while.

Dude. Good news. Looks like your Silver might get a pop soon.

After that you could sell a couple bars and pick up this bad boy. Swing by (no pun intended, please?) and pick me up. For 1,121 mi 17 hours 41 mins 35 hours 22 mins there could be a Peaceful protest. Afterwards you are on your own. Not it for driving.

"All I want to know is who's coming with me"...or you can just wonder how this happens. Then go get this shirt and sit with Gasparino in the Green Shoots Watering Hole and toss back a few.

Updated chart

Sure looks like the beginning of the end? I would expect the most aggression right here from RoboSpy.

[addendum: GS will be the short of the decade in due time. When the hedgies unwind the 'long the best short the rest' it's fun to watch...once they realize GS has pretty much put the noose around their neck. (edit: Go get em!)

I do have those videos and I captured a couple today. It only took two takes for me to annotate it in real-time before it happens. I still have to edit it.

Ten dollars to a doughnut this was within arms reach of Newman? Any takers? Time for them to get paid on the downside now...I'd like to know a little more about who was purchasing those (besides me, which no doubt was skimmed by newman on the ask)]

Be water my friend

Well I totally wasn't expecting to see all 20 points like, today... Nonetheless the Heisman maneuver is in motion now.

Clue #3: Treasury Auction Schedule at Ticker

[Addendum]

Clue #4: Nazdaq

Alternate Post Title #1 Operation Desperation

Alternate Post Title #2 The cards have all met gravity; Gravity is winning.

Alternate Post Title #3 Gasparino did not miss a branch falling out of the 'dumbass tree'.

Can you not feel the tension? Since there is exactly eleventy-kabillion-million dollars on the sidelines just itching to see if this 200 day moving average turns up. Ivy leaguers just dying to sit in a square and tell everyone why they just deployed your money so they can start getting paid (scratch that. Edward Jones broker didn't let that guy get out of the market. But thanks for seeing him early. "Don't let these short term depressions get in the way of your long-term goals")

• Ka-billion-million dollars on the sidelines (for good reasons, however this is the gambit)
• Overbought at the high (nearly)
• Fauxbama spewing on TV about how he 'fixed the glitch' (a/k/a: confidence booster)
• The need to take off the SLP training wheels soon...
• Goldman signed own death warrant; the heat is on now.
• Everyone [the thugs] are all talking [up] at once
• The additional power grab by the Fed would be the worst thing possible. BerTanke's demeanor was a little more 'irritable/evil' today. They are scrambling right now.
• The spyGunner is back from vacation.
• This entire sham is being lead by "Goldman" with the "Best in Breed" and brightest technicians. Trader X has very deep pockets.

Pretend for a second this is all a game of "Confidence" (oh wait). Pretend you had monopoly money and were feeling a little deviant. Are you going to attack when things are oversold or overbought? How is a melt-up created? Sun Tzu (ok, I'm carrying this a little too far). Just stay on the sidelines if you are unsure. I wouldn't try to be the first one in the water here. Just my preference though. Seems way too dangerous for me and I like to surf the edges.

Laugh all you want. I dare you to get short right here (not really). Unless 20+/ES points is in your risk tolerance I still think it'd be best to wait. Fyi, where do you think "liquidity" comes from? You. Do you want to give it to Newman? He is very tricky. Remember what I said about this being a game of people and not numbers.

The market dynamics will forever change...

Recent computer manipulation in the markets have drawn so much attention that it's a near certainty we will some major changes on that front. Liquidity will be removed as a result but it's liquidity we didn't need. The market has become nothing more than battle bots with the retail investor caught in the middle as you watch your liquidity being swiped one penny at a time by a RISC processor when your "Money Manager" backs up the truck on Simon Property Group Preferred shares.

Who's gaining confidence here? I do remember 'Tanke expressing confidence that the banks will earn their way back to profitability. Hah. Put that in your 'TARP/401k/IRA/USD/Green Shoot' pipe and smoke it.

I'm going to cut Kneale some slack this once because Kudlow looked a little sheepish when Denninger was there trying to educate ivy-league tards who slap on a bowtie and are showered with five-hundred million dollars morphing into the authority. Not sure if this invitation was for damage control or perhaps Kudlow was put in his place. More than likely both...However I would rather see Denninger on Bloomberg, Fox or [edit: MSNBC (Ratigan)] and not the propaganda channel. I will tolerate it so long as a concerted effort is made for 'unbiased' reporting. We want to hear the truth sometimes.

I meant to throw some props to Glenn Beck for the visual on the Goldman Civil Servant Web. Well done. Ditch the shoes. Stay cool.

Step 1) Read Big Brokers and Advanced Look (aka: flash ) Orders (not the actual title)

Step 2) Check back here later after you've had a chance to digest some of that and give it proper thought.

When I read that (I'm way behind as the `Google Reader (1000+)' will attest) I was somewhat shocked. I was not shocked over the disbelief that this could happen. I was shocked simply because it confirmed what I "thought" I was seeing with my own two eyes. I can not tell you how many times I've seen certain "setups" occur throughout the day only to see "weird stuff" happen.

You might be thinking . o O {Now this paranoid tard trader is talking about 'seeing things'} . Fair enough. I've been wanting to talk about seeing 'manipulative/bullying' action in the futures from time to time but refrained from doing so because I knew it would be discounted as BS because this was not something I could illustrate with a chart or even Time & Sales data.

However after I read that article I decided to "video" a couple of windows for the first time today to see if I could catch and illustrate a 'flash order' and how it impacts the bid/ask [*and subsequent order flow] . I will try to get this edited and put up somewhere for viewing (will likely need to be swf for resolution and put somewhere other than youtube for that reason). I will try and get this up as soon as possible but this video editing stuff will be a first for me.

[Addendum: Just got some disturbing news therefore it might take longer than I had hoped to get this out...I will try though. Although here are some nice /ES purchases within 20 seconds of futures closing. You see a lot of 'settling' for the first 10 minutes but things usually aren't this active in the last 20 seconds, even if so it's "balanced" and not on one-side (this is filtered time&sales size >= 300)]

Disclosure: No position but might try and make 3 brazillian dollars on a quick short. I would not look any further than 52 on the downside and expect 152 on the upside.

For the time being, do not look any further than 918 (on the downside) in the SLP242; I don't like what I'm seeing in some of the charts and various sectors. I knew if I drew enough scenarios one of them would be within 30%. I think I will throw up a few banners ads now and start a subscription service called ThurgyStreet.com with my super secret toolbox of indicators (tongue in cheek). I will say they aren't as good as that oscillator Cramer claims to 'pay gobs of money' to S&P for. No way they can compete with Doug Kass' ability to nail Fibonacci retracements,...[re-]calling them a week before it happens. Cramer is nearly as good as Goldman ("Newman") and you would think they came from the same school of thought. It's good that we can have this "knowledge" disseminated by CNBC.

Speaking of GE. Please tell me that you aren't paying Dennis Kneale's "producer" (wtf, rofl again) with my TARP wampum? Don't make me `wittle a WOODEN ARROW SHAFT out of beech-wood, Focker' [**]. Son of a ....When is my tommy gun coming in off ebay [**]

Sorry for the rush... Posted this from GE Airfone. I'm feverently (compiler error line 1) reading the dictionary right now to prepare for a job interview at the Treasury. Will report back later. Going to try this 'kill them with niceness' fad I've been reading about. I know about the kill part but this is the first I've heard of that other word.

[**] Geithner, this was supposed to read "baseball bat and disco ball". However this was not directed at you. A lot of people call bankers "self-serving-greedy-bastards" but I could not disagree more. Who could not admire your thriftiness. You are willing to rub elbows with the "common folk" at Walmart going to pick up your copy of Turbo Tax. I must say if only half of Congress would follow your example the world would be a much better place. And for this we owe a lot of debt and fortitude.

Toa chie,

Thurgy-thurg

PS. If you happen to miss the big red warnings when you are doing your taxes then look into the Audit Checking feature in that bad-boy next time. It's deffo worth the look!

(Update1: 1:15pm Somewhere over Northern Va):

I hear they will be taking down three of the WOPR T2 clusters tomorrow for maintenance and it's looking like we might be without 242 of the heaviest components in the indexes. As a result it's a good chance the index falls back into the thermosphere near 918; the same friction point that was once resistance will now serve as support [in what leads me to believe the last lunge to 980?]

Not heart charts; Gut pulls into the lead...

Not positioning short this market yet (Those little Q's puts I had now have a shiny new AAA rating in the Maiden II fund. Now who's laughing?). I can see it in the DXY(mind boggling chart, and shows another smaller leg lower [*perhaps after the market pullsback to that 918, not sure, 50% chance I'm right]). I will be in and out of trades but that "gut indicator" is forecasting more stocktwit pain to come as they chop-churn their accounts into net-debit when Trader X at the BNYM/FRBNY sits on the 'Buy 1000 /ES button' sometime around 3:58pm (and dumps to some poor computer around 4:01. which forces a run-up of 10 or 20 points offloading to the stocktwits, who made an informed decision around 4:14:59 to swing long as a result of the late day buying frenzy...Only to find out around 4:30:01 they opened down a smooth 4 points because WOPR went into sleep mode.

[Update 2 (sent from blackberry) Baggage Claim 2:40] Wait for the /NK to maybe hit 10,000 and have a look at positioning. That's been the stopping point recently for all indexes. I'm not making a bullish call just futhering the reason I'd rather watch now with some long/short trades in between. YMMV with your style.

[Update 3 (sent from wireless connection) Lobby (after closing bell) OMG, ROFL. Not quite 4?? down but still worth a LMAO. 'twits capitulated, time for it to run up and see if they can lure them in.]

Chart times are local to exchange (Central),

[Update 242] Being escorted down an alleyway by two large gentlemen in black suits. They say his office is this way but it's kind of dark here. Wish me luck!

Yesterday I promised some shallow thoughts on why I wanted to hold up on the IYR (and DB for that matter) even though it landed in the palm of my hand. Unfortunately I was exhausted from the two days of spaz posting and when I looked up yesterday afternoon I figured I should pay attention to the market instead of blathering.

For now just think the XLF and IYR are synonymous. I can only express the 'hold up' as it relates to swing trader (options for the most part, where time/entry is important) or otherwise looking for a "spot" to take a stab. Furthermore, I will base this argument using the HE (Human Element) and why it feels "trappy". You could easily dismiss the HE (most do) and be my guest, just don't whine if the IYR goes to 35 and your puts move off-balance sheet until you and Black-Scholes work out your differences. If things turn down here (and it just might after today's market action into OB) I stand ready. But I'd much rather get in when someone else gets squeezed out [which has been happening the last few days in case you haven't noticed]. Nope, not a bullish call whatsoever. I just have to consider:

1. First off this is not a ticking time bomb. It has long tic'd it's last toc (been in motion a while).
2. The [bear] market is known to deliver max pain in each direction.
3. A general bias in the market is to go up
4. Green Shroom hallucination
5. You probably hear "CRE Time Bomb" at the local VFW Post #42.
6. They need to raise several factors more in capital.
7. Earnings season
8. The [fraudulent] maneuverability for earnings.
9. The debt holders of the CRE are small banks and large banks alike.
10. Underwriters of the offerings are banks.
11. Bernanke/Geithner
12. HB&B(and oil) underwriter who we all have grown to love: Goldman (pronounced like the Seinfeld, 'Newman'), JPM, etc...
13. SRS-flipping-Stocktwits

I've said this in the past...When the bulk of the market comes to expect something, it usually does not happen until it has destroyed the confidence on both sides of the fence.

CRE will go "tee-totally-bust", but if you are here to SRS/IYR for the next week or two just be extremely careful. I've been a SPG/CRE bear since March 2008 and it learned me a time or two before I got dialed in and started p0wning (in one such case). Oft overlooked element #2: Time (not theta, but relating to how things evolve in the market). We know about their fundamentals. We know it's now on everyone's radar. We know everyone has positioned themself short the entire market (or trying/wanting to). We know that there is nothing positive on the horizon (I couldn't care less what NBER gets around to doing). Just know that the weeks of 90 degree market movement are more than likely over because the market lives on hope and clark w. griswalds. Expect all news flows and disruptions in the force to be very closely monitored/guarded. Lastly, expect the unexpected but don't live by it.

Finally, one might come to the conclusion that I'm just a paranoid tard trader (is there such a thing as investor anymore?) because I refuse to only focus on "charts and fundies" and just looking for the next conspiracy. I'll admit that some of the above bullet items are exagerated' but the "gut indicator" certainly was not innate. Moreover, it was not until the H.E. received a larger weighting in the decision making process (short and long term alike) along with understanding the importance of time did my P/L see it's largest gains. Learn to sit on your hands every now and again instead of perhaps being a srs-flipping-action-junkie-who-probably-heads-over-to-pokerstars-after-the-bell in order to feed the compulsive need to continuously make quick and uninformed decisions about what's going on in hopes to strike it rich. If this offends anyone: Bite me. If so, you might be familar with this quote: "Eventually all money flows from the weak to the strong". You fall into same category as the mouse-clickers-based-on-cnbc-breaking-news-banner types. (See above bite me)

What works for me might not work for you. Who doesn't make mistakes though? I had to re-learn more than one thing and have ignored the obvious or got long/short just because something was OB/OS only to be gently pimp-smacked and reminded [most recently in soybeans when it nearly left the Milky Way]. I'm a slow learner :) Nonetheless, I think "HE" should be taken into consideration along with the technical and fundamental.

I hope this was presented in the most incoherent manner possible. Proofread? Spell check? What's that? I thought that's what the "(update)" was for?

PS. Will have to start the 'Digital Dickweed Vol N' next post. Gotta run. Although the importance of Time/Patience I accidentally learned from one of those dickweed's post not even related to trading (iirc, I took away the important message and not the details). His name is Zen Master Mish. He's probably not too concerned with the Kaleidiscope of "Breaking News" banners. I'll admit I could use a little more patience/time when typing these posts :)

PSS. If you are still long KWK, might be the end of the road right here at 10.50. I didn't think it would take out 9.50 though (H.E. case and point), but now it's ripe for a pullback (if not more than a pullback). Warning.

Introduction (first sentence, page xiii):

IN THE PAST YEAR, both the U.S. and global financial systems have changed so radically that few, if any, could have predicted it.

Thurgy: You lost me at hello. Anyone want a book? Slight dog-ear up to pages xiii

This book was a gift to me (and that's as far as I read). While I am not to be included in "those who had a clue back 2006 through most of 2007 (or whenever), I will end every post afterwards (until blogger.com runs out of disk space) with the saved quotes/links/graphs from all of those "digital dickweed doom and gloom bloggers who might have had a clue. This will be easy because in Q1/08 a friend hit me with this email (before blathering here) : "Not that I mind, but just curious as to why you love the bleak side of the picture. Are you always a bear, or is that just where your money is now?"

My response to this was nothing short of an incoherently compiled thesis from either direct quotes/links/data from those 'digital dickweeds' or even some of my own (they taught me how to fish...novel concept). It was data that only an octabox of pundits (standing on their head) could misinterpret. None of these are stock charts and technical analysis (I tend to bypass technical blogs** hence my laughable and unorthodox style. Like me, it's a tool not a science).

** Occasionally intermediate term technical analysis shows up on the 5 blogs I have time to read on a regular basis. When it does, I pay attention to it. From time to time I tune in to some EWT analysis because I only know enough to be dangerous and am not interested in mastering that one. One technical blog that I read is one who's speciality is analyzing VIX,IV/HIV. Not only will he admit his mistakes, he will do a post mortem which is educational in and of itself. I do post a lot of TA here, but that's because this blog is mostly for myself. See any banner ads around here? I am not worthy nor care to click the 'Monetize' button in the blogger dashboard. Not looking for hat tips nor have an agenda (well, except for the truth to come out). My compensation will come in the form of sheer satisfaction in seeing all of America simultaneously shit an eggroll when it does. I'm not talking about Goldman Props or hoping to see the market crater. Just the truth [and accountability]. The clued that I will reference are worthy and should be compensated for their contributions. This is more or less a brain dump (640KB) to remember and keep myself honest. A short pencil beats a long memory every day of the week.

Actually, I thought I was here for only for one post ( metrofaxed to all 535 sometime before TARPoilet paper was passed. Without the Sig of course. You should try it sometime...) Even though Tank Paulson's hired callbanks somehow managed to invert a 300oooo:1 opposition from taxpayers. Maybe that's why they [Paulson=Goldman] needed Sergey's SS7 experience so they could use WOPR to call congress *tongue in cheek*).

However, If I can help to disseminate [what I believe to be] the truth then I will (along with an occasional ego stroke if I get lucky. Any other content you may find offensive gets a big bite me). Otherwise I have to try and be witty and even then Durden beats me down. He must be one of those smart and funny guys. What a digital dickweed P) If I ever catch one of them making a typo, sounding incoherent or otherwise appearing "average" then it's going straight to Kneale:P Also, my poking fun of this financially-engineered-disaster is nothing more than the stage prior to the tommy gun coming out *****, which in case you haven't noticed lately isn't that far away. The only relaxation therapy I have is to watch this ENTIRE video over and over again. I totally need a baseball bat and a disco ball. Fwiw, I do not condone this behavior whatsoever...he wasn't even wearing eye protection (after further review, that appears to be CNBC HD on his TV...son of a...I've been tricked. CNBC is one thing...in HD is unsportsman-like conduct). I hope to see him wearing safety goggles in his next video. He could take down an octabox of pundits and win homerun derby at the same time. Eat your heart out Barry Bonds.

***** This is not directed at you Barney Frank. I know that in the good times and in bad times, through thick, thin or ribbed you will always have our backside.

PS. Hold up on IYR, Thurgy got an alarm from the 'gut indicator' last night somewhere in REM State #2 (while still at computer watching above video). Will post shallow thoughts later.

PSS. One day I will get a post out without 72 edits in the first hour.

It's all about Goldman Props today.

• (Bloomberg Video) Spitzer on Goldman today (my new hero for the day)
• (MSNBC Video) Ratigan & Ritholtz on Goldman (nice, worth the watch. Sorry Spitzer. Tomorrow?)
• Goldman Sachs Program Trading volume takes a 60% digger (In no way related to the pre-announced changes in reporting, network outage, absense of artificial support in the SPY, all near the same time... [edit 19-Jul: nor will we be hearing the drop in program trading was they had to turn off their manipulator due to stolen stolen code.... that they waited a month to report... nothing to see here, move along)
• (CNBC Video) Gasparino grows a pair

So far we have:

1. For the second day in a row the Euro refuses to play ball and oil fails to get traction.
2. Yesterday investors sought shelter in the rock-solid Banks, Consumer and REITS.
3. Today, XHB is at the top of my sector watch (ignoring the ruskies). This is L-O-L #2
4. The Naz has not shown the leadership and by my judging from the price action (except when we overshoot VWAP by 50 or 60 points) it's looking weak (lol...after the bell; scratch that)
5. Goldman will likely be the high point of financials (and JPM). The rest (are there any left?) didn't have enough SPARCs, watch for XLF weakness
6. Bonds, do not ask me. I must have screwed up somehow when I got [re]long TLT at 91. Somehow I'm turning a profit. I intend to do a full post mortem to find my mistake (nice tankage today though. make that major tankage. profit--; although spread 93/95).

Addendum: I should go ahead and get this out of the way. It only takes one

falken@wopr# /etc/init.d/spyGunner start | mailx -s "all your shares are belong to us" turbotimmy

to send this straight to the Lazlo Line (~1400). Until further notice (or a rolling blackout in the northeast from an EMP) just assume this is a standard disclaimer.

A lot of people are wondering how this will all end. According to my sources in approximately 2*10^63 more moves Goldman's WOPR and JP Morgan's Deep Blue will declare a draw after having ran over the lesser mortals. In one such instance, Goldman's WOPR did a 3-move checkmate on Grandmaster Shorty while JPM & Deep Blue's wreckless SPY sacrifies discombulated International Master WTF forcing a quick resignation after blundering his rook in 23 (Tal would be proud**). Interestingly, after facing 1) c4.. Kasparov shouted several expletives and left to become the Russian Opposition Leader. He was last seen on Bloomberg standing in front of some important-looking Russian landmark.

In the most highly contested and controversial match of the rally, 18-month old Russian Grandmaster Somethingikov was about to gain market share on Goldman's WOPR when a freak network glitch caused Somethingikov to start dropping packets and was later disqualified after officials said the infant tested positive for HGH.

**Read the Tal Style and Quotations, more specifically the last quote.

Good Times

From the good old days of bbs/uucp service on 2400bps. To installing the latest slackware from about 50 floppy disks (without X11) and then os/2 warp (damn, it had potential) to the nightmare days of trumpet winsock and frantically pinning out a connectors to hook external 28.8's to the trusty livingston pm2e (!root anyone?) Things took a quantum leap with frame relay as well as the booming days of the ISDN and PRI's hooked to the Ascend Max 4000s. Good times. If you could afford 30k/month you had yourself one T3 from UUNet (HellSouth charged 5k/month for the damn local loop alone!). Nowadays for $30/mo. we get comparable speeds to what small ISPs (T1s) were paying a few thousand a month for. We love those 50ms round-trip times to and from our trading platforms...So what in the hell does this have to do with anything?

Goldman (no, I'm not short, nor going to short Kaiser Soze)

By the time you get that packet containing ticks for your favorite issue(s), Goldman Sachs' high-frequency trading systems have already fired off 50 sub-millisecond basket orders derived from that packet they got 49.5ms prior (one of the perks of having a GigE connection to the NYSE). They are only interested in skimming a penny at a time (read: marginalize/tax every other participant) transacting up to a 'hunert-google-ka-billion' shares per day from program trading, search and destroy algos, etc. As if this isn't bad enough, they get a rebate per transaction for being a supplemental liquidity provider. If this is the type of liquidity we get, I don't want it. It's a liquidity drain, plain and simple.

When Goldman reports their earnings every [mortal/weak android] market participant, win, lose or draw should vomit knowing that Americans have taken a permanent $12T haircut in net worth and these ****suckers are setting records in both trading profits and bonuses. Supplemental Liquidity Provider or Liquidity Drainer? Sure you may think this is because the market went up eleventy-three percent but they also reported record profits in Q1 as well. How hard is it to be prophetic when you've got THE deepest pockets, the biggest following, the most clout, the most inside information and are able to bully, prop, pump and dump at the speed of light in vacuum (without recourse)? In other words, when the deck is stacked in your favor you're going to have to try and screw up really bad in order to lose. How hard is it for them to setup the trading conditions that would trigger basket orders (search and destroy)? I feel this is precisely Goldman's concern over the stolen source code. When you get to be this size you should face tougher restrictions instead of being given special exemptions, ethernet ports or a straight signaling feed from the NYSE STPs. Heck, maybe even if you had an alumnus at the NYSE you could get him to do rate shaping/QoS on the other broker's VLANs. However, be very careful mucking with the switch configs during the day because you could accidentally blackhole the trading floor's traffic and we'd have to extend trading for 15 minutes (tongue in cheek?)

How hard is it if you can short sell derivatives to their customer next door AND get AIG to naked short you CDS on those derivatives knowing full well it's gonna be double the pleasure (this may or may not be entirely correct, but it doesn't matter, they still suck)? How hard is it if you know you will be underwriting a secondary offering (fees are based on a percentage of the money raised aka: stock price) to put them on your Conviction Buy List, to give the stock a boost, underwrite the secondary and then shortly thereafter remove them from the Conviction Buy List citing deteriorating market conditions? Do I really need to pull up a chart of their 'upgraded' issues to illustrate the obvious front-running that takes place 2 days prior? How do they get away with this you might ask? Here is the disclaimer from one of their more recent REIT [correction: should read Bank but it's a form letter] shenanigans like the above:

The SEC can't be bothered, they are too busy locking up Martha Stewart for a $60k profit than to look into things like this. She goes to prison and Fed Chairman Friedman (who once ran Goldman) banks nearly $2 million (doh, now over 2 million) when he bought 37,000 (more) shares of GS a “bank holding company” and all he has to do is resign. Nice.

I understand when you are considered the “Best of GBreed” you are going to attract envy, critics and conspiracy theorists alike. But everywhere you turn you see something with Goldman that stinks to high heaven. From questionable business ethics, morals, conflicts of interests, front-running, to being implanted in every corner of government. Civil servants my ass. They are in more places than Visa.

Every time someone even thinks about imposing restrictions either GS will lobby to have it stopped or will receive an exemption as a result of the lobbying. That is greed talking. Some amount of greed is healthy but when you crap on other people to service your greed then you are no good as far as I'm concerned.

You're not seriously asking me to trust that the bigger and more powerful an investment bank becomes the more ethical and moral their practices are? Should I sleep safely knowing that our regulatory bodies are on the ball and are in no way conspiring? When is the playing field considered to be unfair for the majority of the participants? When you get to be this size you should face tougher restrictions instead of being given special exemptions and rebates.

Am I supposed to believe the $10B in TARP they received was due to either a) they were no longer the best in breed or b) not to create a stigma among other banks? I'm going with c) it was insurance from Tank Paulson in case there were problems bailing out AIG. If AIG filed it stood to leave a huge hole in Goldman's balance sheet. Even though you know they had to of hedged (naked short the underlying, naked short other banks, standard operating procedure) because, after all, they are the “Best in Breed”? In the meantime, while the AIG Conduit was being erected Goldman, in risk-free fashion, put the insurance money to good use filling supertankers and buying equities in hopes to double up. Once the AIG check cleared the conduit Goldman was more than happy to return the TARP. By the time this is all said and done Goldman will probably have been paid 2-3 times for one bet. “Best in Breed”. The only thing that gets under my skin more than Goldman Sachs is an unnamed (D-MA) that talks like Elmer Fudd. But then again there is Dennis Kneale.

Dennis Kneale / CNBC

[I do not care what he has to say and I'm sure he would value what I say no more than a warm bucket of spit. Do not mistake this as attempt to grab attention from this clown. I have no such desire.]

I was amazed to learn that Kneale now has his own prime time show with CNBC. At the same time I was disappointed the show wasn't co-hosted by Bob Pisani. I think the “Kneale and Bob Show” would be a more appropriate title for the network. Who knows, with a name like that they may even attract an entirely new demographic from the PPV channels. This demographic enjoys getting “screwed” and should feel right at home over at CNBC. I would recommend strategically placing Mad Money in the rear time slot.

Recently Kneale has set out on a mission to discredit the blogosphere. He has tried to take issue with the anonymity surrounding them. He has went as far as calling them 'digital dickweeds' for taking issue with him lipsticking every piece of economic data that comes out. After he figured out that not even a teleprompter could save him he then focused his attack on anonymity. His thesis is that he does not get to hide. You see, Kneale has his own legal team, a teleprompter and a producer(wtf? rofl). Even though there is no such thing as anonymity on the internet, “Bloggers” still have the fear of having $1000/hr legal E's implanted in their backside or the Government making their life a living hell because someone brought to light questionable data, business practices and/or fraud. In the crime world this will get you murdered (this sure looks like crime to me).

I'll have you know that without blogs I would not have received the education that got me out of the market Q3/4 2007 (and short thereafter). Instead, I would still be watching CNBC, probably broke. I would have missed getting those Fannie Mae $25/put leaps (till zero). I would not have been able get short REITS (q1/08), or Citigroup at 20 (sold them too quick). This is about the same time CNBC was marching bobbleheads out one at a time (or in an octabox) saying GOLDILOCKS is going to narrowly skirt this one (phew, that was close).

The fact of the matter is that all of this is irrelevant and it's obvious Mr. Kneale's agenda is motivated by ratings. Gee, would you rather watch a show that was telling you the world was going to hell in a hand basket or one that says the recession is over (we're going to narrowly skirt...I mean shallow...I mean v-shaped...I mean U-shaped)? In Dennis' world you are not bona fide until you've written for Forbes Magazine pumping tech when they were cruising near the International Space Station. When I used to watch CNBC I felt he was by far the most unqualified personality on the network and would just assume hear the cameraman's thoughts (who was no doubt a subject matter expert in comparison). I might not be the sharpest saw in the shed but you would've had to of been standing on your head to misinterpret the data (along with everyone else who claims nobody could have seen this coming).

Nonetheless, I'm deriving great pleasure seeing the likes of ZH and Ticker learn Mr. Kneale a thing or two (read: total beat down). Even funnier is that I can honestly say Mr Kneale was the reason (or the straw) I stopped watching CNBC way back. It was the day I heard him stand there on Power Lunch and call the sellers FRAIDY CATS and exclaim that he is still actively investing in ETFs (dollar cost averaging, lol). That's correct Ladies and Gents, at Dow 12000 one Mr Kneale had hope and fortitude (not to be confused with aptitude). Do you remember this CNBC slogan?

If you feel inclined you can search for the FRAIDY CAT video because I would rather be chained in front of a television and made to watch back-to-back marathons of Ice Road Truckers than have to witness that again. If you do watch this guy just pretend he's not trying to get you help his underwater portfolio. He's probably averaged down by now to at least Dow 10k and a $500 cost basis in GOOG (sorry sw).

Rewind:

Dennis Lets Zero Hedge Have It

Kneale: You Asked For It....

(Video) Denninger Goes On Air, One Minute Twenty Seconds Of Airtime Ensues

(Video) Follow-Up To Dennis Kneale And CNBC