Thursday, October 22, 2009

More Beefer Antics

Yesterday the market cratered around 100 pts. in 45 minutes at the close. To whom can we ascribe such inane selling ? Beefers*, of course. [*Beefer = "big, evil fund defined as a hedge fund or mutual fund that trades very actively and has over $100 million in assets.] My guess is that the selloff was from liquidation of Galleon. The owner / leader of that group of hedge funds was arrested a couple days ago for insider trading. Hence, its investors all wanted to redeem their money. I suppose sell lists were sent out to the Street. The Street's principal traders probably shorted the stocks to front run the sales. And all that had to be done by the close. Wonderful.

These antics just cause the public to be a bit more disheartened by the market. Too much of this volatility occurred last year. The average Joe wanting to make an adjustment in his mutual fund gets flung hither and thither. Some days he's lucky, others unlucky. All for nothing. Beefer antics add zero value to the markets. All that vaunted talk of liquidity is sheer nonsense. The Street's proprietary traders suck that out in milliseconds and the beefers themselves cause bids to disappear and shorting raiders to emerge from the hiding places.

As for Galleon, there was some discussion a few days ago whether the government was proper in using wiretaps. Today's news reports make it clear that several informants gave the government plenty of probable cause for getting wiretap warrants. End of controversy.

The FT shows another example of the dumb rich in the "There's a sucker born every minute" Club. "John Meriwether, the hedge fund manager and arbitrageur behind Long-Term Capital Management, is in the process of setting up a new hedge fund – his third. The move comes barely three months after Mr Meriwether decided to close his second fund manager, JWM Partners, which was wound down after clients saw the value of their investments fall by more than 44 per cent over the course of the financial crisis. JWM Partners was set up soon after the collapse in 1998 of Mr Meriwether’s first – and most infamous – fund, LTCM, which triggered a wave of panic across the world’s markets ..."

Who in their right mind would invest money in that nonsense ? Two funds blown up and now a third try ? Sheesh ...

And think a bit ... every proprietary trading desk on the Street does the same thing with billions. And are they better than Meriwether ? Nope. All this is simply a scam - hucksterism at its worst. Get other people's money; speculate, get fees and bonuses and then blow up. The Street is littered with the carcasses of those for that past three decades.

But now the the web of swaps and derivatives, the big firms are linked. So blow ups will necessarily bring in the taxpayer again. Ban all this nonsense or require 100% cash or physical collateral for any net short positions in derivatives.

Actions

My Tuesday sales to take "sugar" on some call options were timely. Earnings are good, but this market needs some news to move higher, such as a big drop in unemployment claims or some better job numbers. I still think that will occur by year end (as I said a few months ago). If it does, S&P 1200 should be hit. I'll wait for now, but might re-buy some calls if prices get cheap on some interesting names.

Word of the Day

"Onomastic" - adjective [$10] a Mencken word;
"Onomastics" - noun, plural (treated as singular) [$10]
Onomastic means relating to names or nomenclature.
Onomastics means the study of the origin and formation of (especially personal) proper names.
Sentence (from Mencken, The American Language, page 553 bot. referring to the origin of "Podunk" as a colorful synonym for a very small town.
"Here Dr. ____ seems to have been in error, for an onomastic explorer, _______, reported in the Boston Herald for February 8, 1933, that he had discovered a veritable Podunk in Massachusetts, not far from Worcester."

79 comments:

Spin-em said...

...up 80 buy,buy,buy.....down 90..sell,sell,sell......ding dong....Barry calling..."let me be pefectly clear...you honkies still owe me my transaction tax"

Bunkerman said...

lol

Bud said...

lmaooooooooooooooooooooooo


what a surprise.............somehow i knew once the market tanked at the close yday...............what wud be the 'topic' of today's post

Bud said...

beefer antics ??? huh ????


what antics you talkin about Bman?..............the non-stop buying and chasing of stocks of the open yesterday...........or since the march lows???

Bud said...

lemme ask you a question Bman


why is it that in EVERY other business...........customers that pay more get treated differently

if i buy a luxury box for a sporting team........i get treated differently than the guy in the bleachers...........i buy a first class seat for a flight to prague.........better than the workin man in coach..........if i have the money to afford a cardiologist at the mayo clinic ...........better than the janitor who has to go to the county emergency room............if i am charged with a crime...........someone who can hire a 500an hour lawyer gets a better defense than the guy who uses the public defender.................i can go on and on and on..........all legal and ethical in a capitalist society






but in the stock market...............why should the 'average joe' who trades 4 times a year and has a 35k account have to be treated the same as the guy who has 125million in the market and trades 37times every hour ??? it's ridiculous and doesn't make any economic sense.................just populist bullshit




give me a F'ng break

Bunkerman said...

Is this a version of "Operatino Change the Subject", Bud ?

I thoguht I was rather clear, describing the antics precisely for yesterday.

I think your were using "ignoratio elenchi" - the fallacy of irelevance.

;)

[Just finished my book on fallacies of informal logic, so I can practice here]

;)

Bud said...

the stock market is like any other business...............if i spend money to gain a competitive edge...............by hiring traders , analysts, better technology..etc....


i should be allowed to crush my comptetors and i should be rewarded for makin a capital investment................it's true if i open a restaurant or sports team or textile factory or iphone-maker .......................................

Bud said...

the biggest myth of all is that the 'average joe' is not in the market cuz it's rigged or he doesn't trust it


NO.......the avergae joe is not in the market cuz he doesn't have the money.............the overwhelming majority of americans live paycheck to paycheck...........end of story




PS......you can't beat the casino........why does the average joe love to gamble??????.............cuz he can play slots for a quarter

Bunkerman said...

The common man is not treated the same in many ways: the beefers get all kinds of services for the order flow they provide.

BUT it is a principal of public policy to give the common joe the same fair price for buying or selling shares as the "big boys". This was done decades ago to attract the common man to have confidence to invest in stocks.

The Street wants their money - let the Street treat them fairly. It was a bargain struck decades ago.

Bud said...

that's hilarious on john merriweather............another fund??


hey....... it's a free country............there is no law against 'burning your money'

Bunkerman said...

I know plenty of average Joes who own some stocks; usually a few plus some mutual funds.
Of course, I am in harmony wih the common man.

I think you need to accept one core principal: the markets were created and exist to attract investors to raise equity and debt for the corporations. Thye do not exist to give traders a means to make money. That is a result, NOT a cause. The rules of the markets are going to and must protect the core principle, or they will die.

Bunkerman said...

lol, no law agaisnt stupidity either. One would think exposure would vaccinate the rich against it, but noooooooo.

Bud said...

Bman i haven't heard you opine on the 'pay czar' pay cuts yday


the feinberg prick makes me puke.............he's a f'ng pinko communist

Bud said...

congrats mern on the phillies.............easily the best team in the nl......F joe torre.......scumbag faggot



PS...........you apologize to charlie manuel yet??

Spin-em said...

the stock market is like any other business...............if i spend money to gain a competitive edge...............it's true if i open a restaurant or sports team


I find that interesting..and I have index carded it for future reference

mfl59 said...

lmaoooooooooooooooooo

MVP MVP MVP....way to go spin!

Bunkerman said...

MMM good earnings - a 1-2-3 Fund call position. Will monitor for adequate 'sugar'

Bunkerman said...

I'll wait for facts on what Feinberg actually does.

That policy proved itself on teh wiretap question.

Bunkerman said...

ditto re mern and the Phillies. Congrats.

mfl59 said...

why is it okay when "beefers" jam the mkt higher but not okay when "they" push it lower?

Bunkerman said...

Oh, I've griped about the upward jams, too - remember my pointing out how taht stunk since they would all eventually sell at the same time.

Perhaps that should have been "indexed for future reference" ?

;)

Bunkerman said...

lolol Bman successfully eludes mfl's rhetorical "circumstantial ad hominen" trap ...

:))

mfl59 said...

hmmmmmmm....we may have to go to the judges on this one....

Bud said...

shut the F up ace !!!! hahahahahahahahah ................that's real funny...........mvp my ass



PS............still wanna have a beer with me???

mfl59 said...

no sir...I simply thought the right thing to do would be to buy a keg and a sub for the boys...afterall of the support we have given you, it just seemed right to me...

Spin-em said...

sorry bman..ur down day beefer rants outnumber the 1 up day beefer rant...lol

Bud said...

But it is hard, also, to think of a parallel in history. A country heavily in debt to foreigners, with a government deficit it is making little headway at controlling, is creating vast amounts of additional currency. Yet it is allowed to get away with very low interest rates. Eventually such an arrangement must surely break down, bringing a new currency system into being, just as Bretton Woods emerged in the 1940s.



http://www.economist.com/businessfinance/displayStory.cfm?story_id=14686307&source=features_box2

mfl59 said...

According to David Rosenberg of Gluskin Shef (and former Chief Economist of Merrill Lynch), no US market has ever been this expensive in history. The Tech Bubble, which by all accounts was an extraordinarily overpriced market traded around a P/E of 40 during its peak.

Spin-em said...

I simply thought the right thing to do would be to buy a keg and a sub for the boys...


loooool...that cracks me up

Spin-em said...

bunk dont we want a strong $$ so other countries companies come here to build plants and create jobs....doesnt a weak $ give our companies incentive to build overseas and create jobs there?......the world used to run to US to save em in times of crisis... what happens when the shit hits the fan and the $$ doesnt go up??...wouldnt you value a few chocolate bars on a table rather than pile of em stacked to the ceiling

would that be something you'd be interested in??

Do you want to throw a boomerang...and it not come back??lool

Spin-em said...

all Im sayin is KING DOLLAR

lmaoooooooooooooooooooo

Bunkerman said...

I figure the market is 15x 2010 eanrings.

Not expensive

Bunkerman said...

The fundamental problem with that dollar piece is that the US debt is ALL in dollars.

Comparison cases were all foreign currency debt or gold debt.

Bunkerman said...

bunk dont we want a strong $$ so other countries companies come here to build plants and create jobs....

wrong way, spin.

A weak dollar makes it cheap for them to build here to access US market.

Bunkerman said...

But I do think many gov't policies give US companies an incentive to source goods overseas.

Those should be changed.

Bunkerman said...

weak dollar is why my wife's Mercedes was built in Alabama.

Frosty said...

"I figure the market is 15x 2010 eanrings."...and Sal is a bright well read handsome young man with a magnetic personality...mern is up 100000% this month...yadda yadda yadda.

Spin-em said...

well......what about the chocolate bars????

roflllllllllllllllllllllllllll

Bunkerman said...

well, more precisely, at S&P 1200 it will be 15x 2010 earnings of $80.

Frosty said...

"Should a severe correction be at hand, you don't need to predict it in order to be safe."...off to the bank to deposit that lil gem...thx jim.

Bunkerman said...

MMM better than
"expected" - took the sugar on MMM calls - over 50% gain.

Hannibal Hayes – The A Team

“I just love it when a plan comes together”

Frosty said...

what...thought we buy the dips sell the rips...meredith must have spooked you.

mfl59 said...

Bunkerman how many shares of GS are you currently short? or are you using an option "investment" to get short exposure?

Bud said...

50% ?? sweet Bman.............another grand slam over the green monster


luv that quote............is that from the tv show?

Bud said...

listen frosty


i'm not gonna let you and any of your peons bring me down...............you can belittle me..........you can make fun of me.........that's ok............i'm strong......i'm motivated...........i will succeed ..............i'm like stuart smalley



"i’m good enough, i’m smart enough, and dog-gone it, people like me "

Spin-em said...

LOOOOOL...pisser...Colonel John "Hannibal" Smith wasnt it??

Spin-em said...

"i’m good enough, i’m smart enough, and dog-gone it, people like me "

not many

lmaoooooooooooooooooooooooooooo

mfl59 said...

Bunky not for nothing but this market needs real buyers...long term investors...not "flip" artists...fine trade though...but I'm just sayin...

Bunkerman said...

MMMM was at a "rip" +2% as much as can be expected from a big stock. New intermedeate term high.

Good enough "rip" for me.

Bunkerman said...

no short GS ... yet.

;)

Bunkerman said...

yes re A-Team TV show quote.

Bunkerman said...

actaully, I think all those insurance companies with variable annuities who sold in panic last Sept/Oct of 2008 due to the guaranty floors are having to re-invest slowly.

Those would be real buyers. But that will run out around 1200.

Bud said...

locked and loaded newyorkyankees +106 up the f'ng wazoo tonite............i cannot lose..........i am on a 9game winning streak............i am gonna murder these guys down here tonite...........both game5 and the series i will win...........f'ng scum bookies


this will be the second biggest winning day of my 15year gambling career........which was the biggest???..........2days ago....when i hit that reverse.........back2backwalkoff wins



" will this damn kid ever lose a bet"

Bud said...

i will keep a close eye on the line now............it should move..........i am so f'ng hot right now..............i know for a fact that guys are riding me.............i cannot lose...........you get these streaks only a couple times in your life.........stick with me ...............i take you to the promise land




Non es deus my ass

Bud said...

don't even know what 'non es dues' means.............but am pretty sure it wasn't complementary

mfl59 said...

you sneaky son of a bitch....you went with a reverse? talk about some leverage....

Bunkerman said...

Non es deus -> You are not a god

Latin ... it's what your slave should be whispering in your ear on thsoe triumphs.

mfl59 said...

"i know for a fact that guys are riding me."


as do we sir, as do we...

Spin-em said...

roflmaoooooooooooooooooooooooooooooo

Spin-em said...

1.5 hours later...still nutten...

ace really shut him down.....Teller style

lmaoooooooooooooooooooooooooooo

mfl59 said...

Pavi locked and loaded Yankees tonight....should be an easy win for the Bronx Bombers indeed....keep riding the big fella boys....

Frosty said...

Sal...how you setting up the last hour emini...the old trap door.

All you want to do is ride around Sally, ride, Sally, ride.
All you want to do is ride around Sally, ride, Sally, ride
One of these early mornings,
You gonna be wiping your weeping eyes.

All you want to do is ride around Sally, ride, Sally, ride.

Bud said...

well well well


yankees now +104................i guess guys are following........uhhhh.....riding me


keep makin fag jokes ace........they are pretty funny................i'm laughin all the way to the bank

Bud said...

actually i'm laughin all the way to my safety deposit box

hey Bman........where is a good place to keep cash?? bury in the back yard??

Bud said...

come on frosty


where you been??.............e-mini traders were watchin 1082...........we bought the break there.................sweeeeeeeeeeeeeeeeeeeeet...........retroactive indeed



PS............would you like me to send you my 'ops expo open interest' spreadsheet????

mfl59 said...

WAY TO GO BUD!!!!! WE ARE SO PROUD OF YOU!!!!! WHAT A GREAT TRADE!!!!!

Frosty said...

yankluvingdouche@teabagmerevy.com

done

heck of a trade Sal...happy for u...well played indeed.

Spin-em said...

...and Eisenhower said to his troops....We could use alot more men like Bud.

(shakin voice) could use alot more men like Bud....Welllll ....done....indeeeeeeeed.....sirrrr

CLAP


CLAP


CLAP

Bunkerman said...

Burial of cash is risky as it might gete wet & moldy.

A good safe at home is OK. Just don't tell ANYONE about it.

Bunkerman said...

burial is OK IF you use a good PVC container designed for burial. Survival outfits sell those.

Bunkerman said...

gues I sold the MMM calls too soon ...

Oh well.

Mrs. B has the stock in Sky Fund.

Frosty said...

Sal...if you have tape wired today, a tip of the turban to you sir.

Spin-em said...

WAAAAAAAAY TO GOOOOOO REAL BUYERS!!!!

mfl59 said...

this is complete nonsense....how dare these beefers jam this mkt higher!!!! i pity the common man....

Bud said...

listen you douche's

it's not that big a deal..........the fact that you aren't on my side.....or the fact that u want me to blowup in the tank...........it's not like it's affecting my trading or my p and l...........i'm not losin any sleep over it


i was simply addressing ace's request to share beer and a sub............believe me.................i don't give an F what you guys wish for me



this matter is closed now............so spare the f'ng phony bullshit

mfl59 said...

wow you are really swinging wildly for a guy with such a hot bat...slow down big guy,,,

Bud said...

sorry ace .......that was a bit harsh............but you know what i am swinging like???.................like a guy who is on a 9 game winning streak


i collected from 1 guy today...........in full...............tomorrow the big guy settles with me




'punched in the gut'

Frosty said...

"where is a good place to keep cash??"...think ya might want to splash a couple yards at bunk's place...get that oil changed...relax.

Bunkerman said...

don't "youse guys" buy my thinking that the real buyers behind this grinding run are the insurance companies re-filling variable annuity portfolios they bailed out of at S&P 1200 in sept 2008 ?

Once the S&P hits the guaranteed floor on the variable annuity, they have to start buying.