Comments on: SENTIMENT UPDATE – INVESTORS ARE COMPLACENT

By: E

Sat, 15 Aug 2009 11:54:40 +0000

shorting the banks?
they have a Fed Put, more powerful than the Greenspan put

each and every bank that is failing and being seized by the FDIC has miracously gone instantly bad….wasn’t their Tier 1 just dandy days before….

many of them were not on the FDIC problem bank list

how can this be missed

many were touted as “fine”

how can this be missed

the big abnks are “fine” but bank failures have not abated

there is something fishy

By: TPC

TPC — Fri, 14 Aug 2009 23:29:09 +0000

I’ve made my contributions at the well also.

By: Van

Van — Fri, 14 Aug 2009 23:27:32 +0000

TPC,

Thanks. I’ve contributed to the 3X tading gods with FAZ. Luckly i kept it under the single Ks

By: Van

Van — Fri, 14 Aug 2009 23:23:50 +0000

Mark Hurlburt’s comment on the short interest below; my question for the professors is what constitutes ‘reltively high short interest’? Also note his comments on other sentiment indicators on 24 Jul. The AAII and II are good enough for me, especially considering Prechter’s comment on traders being 87% bullish after being only 3% bullish in early March.

http://www.marketwatch.com/story/drop-in-short-interest-might-not-be-bearish-2009-08-14?siteid=

By: TPC

TPC — Fri, 14 Aug 2009 23:22:23 +0000

Van,

I don’t mess with the 3X funds. I tried trading them for a few days and couldn’t make sense of their movements….Plus, risk management is nearly impossible with something so volatile. Sorry. All in all though, tech is not at the top of my short list. In fact, it’s at the very bottom.

By: Van

Van — Fri, 14 Aug 2009 23:15:18 +0000

Some comments about BAC by Doug Kass…

http://www.thestreet.com/author/1358076/DougKass/all.html

By: Van

Van — Fri, 14 Aug 2009 23:12:58 +0000

TPC,

What do you think of TYP?

By: jt26

jt26 — Fri, 14 Aug 2009 22:32:27 +0000

The often stated rationale for shorting are: deteriorating fundamentals, potentially strong positive (price declining) feedback from fear of loss. Banks have the first, but not the latter (ditto TPC’s comment on sanguine/overconfident investors). As well, a strong counter to the latter is potential intervention by the government: buyer of last resort (to a point), lots of creative ability to modify “capital” via reg changes, recapitalization, debt/liability swaps. Banks are also a big component of the indices and there are probably some financial players and insurance companies that sold long-dated derivatives that have a motivated interest in minimizing their liability. No one cares about homebuilders; who else are they going to lay off.

By: TPC

TPC — Fri, 14 Aug 2009 21:03:35 +0000

Yeah, be careful with that one. I dipped my toe in the water on the short side with some of the homebuilders today, but I wouldn’t go near the banks on the short side just yet….Good luck with BAC.

By: Eric

Eric — Fri, 14 Aug 2009 20:55:55 +0000

Thanks for the info…it sure as hell is tough being short BAC right now. I think time will prove me right on this one, but it was sure tough when they started walking it up today with the DOW down triple digits.