Full>half

Roubini says fully nationalizantion is better.

A colorful tomorrow

In his annual report, Warren Buffett said America has faced bigger economic challenges in the past, including two World Wars and the Great Depression.

"Though the path has not been smooth, our economic system has worked extraordinarily well over time," Buffett wrote. "It has unleashed human potential as no other system has, and it will continue to do so. America's best days lie ahead."

I totally agree with him as human being, but disagree as an investor. If following his "buy and hold" stratergy and having bought his heroic call last Nov, you will not live through this dark time. You are out of ammo by now.

"Buy when others fear" is a good investing stratergy and works most of times. However, even most sounding method could lose its magic, which does not mean it is not good, nothing is perfect. Unfortunately it does not work quite well this time. You have to prepare yourself for the worst outcome, which Warren Buffett did not outline you, no other so called professionals ever did. And that is why I am pissed.

Warren Buffett

His annual report just out!

True color of Obama

Is president Obama leading us the wrong way? Larry Kudlow says yes.

C

What did I say yesterday about C? If you acted on my call, at least I save you 50%:)

Major phases of a bear market

Historically, major bear markets have also followed distinct patterns.

1. First phase
There is a sharp initial fall that removes much of the 'froth' from the market.

2. Middle phase
There is a strong rally in prices for several months, which may lull some investors into thinking that the bear market is over. The rallies can be dramatic, but have lower trading volume than the initial sell-offs. And the advances tend to be concentrated on a few selected stocks, not the whole market.

3. Third phase
There is a long slow downward grind in prices, accompanied by low volume and periodic false dawns until the bear phase ends quietly as share valuations reach rock bottom. At this point, few investors from the earlier buoyant phase in the market are interested in anything other than the most conservative investments.

Which phase are we in?

Via Investment Bloggers' Digest

No sector rotation!

All the sectors on my screen are under the declining 30 day moving average, the biotech is the latest joining the bear party. Even with recent strength from the banks, the others still want to go down. No more sector rotation, bulls have no where to hide this time.

It does not look like a bottom to me!

C has been bouncing, but the bounce is weak. It does not look like a bottom to me, which is scary.

Waiting for something big to happen?

We are either building a bottom or waiting for another nasty surprise. I would say the latter has a better chance.

I am just so pissed

I have to spit it out. I have taken this for too long. What do I talk about? I am talking about the irresponsibility of our so called financial professionals. Jim Cramer, Warren Buffet, Doug Kass, the list goes on. They act like knowledgeable people, calling buy this buy that on TV, on radio, on Internet. But they never tell you what and how to do if their predictions are wrong. Nobody can be 100% correct in the market. If they are responsible, they should have told you what the stop is, or what the next step is to save the position. They never did. They give you a start, but not ending. A 10 year old child can do that is OK, not professionals with thousands of followers.

Stop too tight

Too bad!

BRCM

Also BRCM.

BTU

BTU is a currently short too.

APC

APC is a featured short in my newsletter.

Against the new proposed tax!!!!

A proposed tax is making the rounds in Congress. A financial-transactions tax on the sale or transfer of financial assets - 0.25 percent of proceeds and purchases - is a disaster to traders, even if you sell it at a loss. A 0.25 percent financial-transaction tax on $10 million of proceeds OR PURCHASES equals a tax of $50,000 per year. This is even if you lose money on those trades!! This tax applies to stocks, options, and futures.

Please sign this online petition:
http://www.rallycongress.com/no2tradertax/1536/
Please contact your local senators and voice your disapproval:
http://www.senate.gov/general/contact_information/senators_cfm.cfm
Please contact your local Representatives and speak your mind:
http://www.house.gov/house/MemberWWW.shtml

Remain bearish

It is on the way to 1300.

Some snow pictures

My apartment buildings under snow.

Banks still getting sold

With banks keep getting hammered, I doubt we will get a real lift.

React, not predict!

If you ever leaned anything from the disgusting decline of 08, it should be "don't ever listen to professionals' predictions". ONLY REACT. If you listened to Warren Buffet's heroic speech and bought his predictions last year, you are in deep water right now and do not feel any patriotism any more.

Why it does not work? Simple, because you are not Warren Buffet. You are a small investor with limited capital and limited financial tools while he has billions of dollars at his hands that he can average down or deploy other methods to cut the costs down. So even if his prediction is wrong, he could still make it work. But you, you are dead when you have a fatal mistake.

So as a small investor, only way to survive a brutal market is to look at the charts and to react.

Steel sector

I wished the steel sector could follow China, it followed for a day or two, but did not get a chance to break out before China pulls back. As soon as China market softens, we break down and take the dive. Totally a loser behavior.

New direction

This breakdown signals the end of recent consolidation and the start of a new down leg. We are far from oversold.

Jim Rogers is shorting the US market

He bets that U.S. stocks will drop as the government’s economic revival plan is a “disaster.” He has correctly predicted China would first come out the financial crisis. So far this year China has rallied 23% while US declined more than 8%. I won't bet against him, will you?

Stimulus package explained (I think it is funny)

If you spend that money at Wal-Mart, all the money will go to China.
If you spend it on gasoline it will go to Hugo Chavez, the Arabs and Al Queda.
If you purchase a computer it will go to Taiwan.
If you purchase fruit and vegetables it will go to Mexico, Honduras, and Guatemala (unless you buy organic).
If you buy a car it will go to Japan and Korea.
If you purchase prescription drugs it will go to India
If you purchase heroin it will go to the Taliban in Afghanistan
If you give it to a charitable cause, it will go to Nigeria

Via Investment Bloggers' Digest.

Frustration

I don't know about you, I am just frustrated this month, in which we can't even get a trend for two days. I am forced to be a daytrader, in this market.

AGU

AGU is one of few long positions have not been stopped out lately.

My feel

I am adding long positions gradually. As I said yesterday, the market does not respond the negative news any more, which seems priced in already. Please remember, we are still in trading range that means anything could still happen.

Strong close

The bullish reversal signals the worst is over? Be patient, we are still in a trading range which will resolve soon.

Weak open

Dow Jones is breaking down the two months' old trading range and investors are fleeing to technologies. GOOG, RIMM, AAPL all in green.

GOLD

GOLD was only big winner for the newsletter today.

Shorting this sucker

The market is fading quickly, it seems it does not want to go up. I am reloading some shorts.

BTW, a reader thinks I sound more lucky than anything else. If I can make a living by the luck that is what he called it, then I am a hell of lucky guy. Sometimes luck IS more important than anything else.

Wrong!

I am wrong! This selloff is nasty. Now we are on the edge of further breaking down, unless we gain back most of loss tomorrow.

Observation

I think we might not see a bigger selloff than right now. The reason? The financials are not getting sold as hard as before. Remember we had some serious rallies last week.

Update: VRTX

Stop out.

Getting rich from blogging?

Thinking about quiting your day job and making money by blogging? Think twice. Blogging is an interest, that is what I think and that is why I am not burned out.

Thanks Maoxian for the link.

NASDAQ

Set up nicely, Geithner don't blow it!

More thought

What is this? A joke? This shows how the new government still can't get a hold of the mass. Sometimes, you can't delay a thing like what you did in your daily life. You can't delay an earning report, you can't delay an important sport event, you can't delay a government annoucement. They should know much much more than I, but they still make such stupid mistake. Again I am disappointed by our inefficient and stupid government.

Wait, we need one more day!

The bank rescue plan just got postponed. Sometimes it is not good to have a democracy. They just can't get one simple thing done.

Happy Lantern festival!

It is sunny and warm in Bejing now, spring is coming.

Now what?

The NASDAQ finally stand above the moving average solidly and is right at the resistance. I think now we hand our fate once again to the hands of our senators. The vote will begin early this week and I hope the process is smooth and satisfying. Although I think the near term direction is up, I learned my lesson from last Sep and I would not "all in" this time.

Update: VRTX

VRTX, still in the portfolio.

GOOG

GOOG has been in my newsletter since 20 pts below.

Number is out

The unemployment number is out, not as bad as people were afraid of. I am buying premarket.

China market, weekly

Touching declining 30 week moving average. Upside target? 264 area. I would not be an aggressive buyer here. Yes on a pullback.

Chinese comes to rescue?

If everybody are dreamed of Chinese saving the world, I would pour some cold water. Chinese stock market just experienced its own bubble being poked in 08, down more than 70% from the peak. It is normal to rebound some after such nasty decline. Though Chinese government has started a massive and more efficient rescue plan, I would still think its recovery road will be like us from 01-05. It is in a big bear market as we were in 01. Remember we are still at the bottom of it even after 8 years' struggle. So I think China is the temporary hot topic to support a rally that the bulls are badly searching for, but it won't resolve our own problem, since this upward movement in Chinese stock market is short term, just a bounce in a bear market.

Missed it

Have let it go too soon.

Hate

This is what I am afraid of or hate to see. Now we apparently have a reversal day, unless we will have a GREAT unemployment number.

Biotech

Biotech is so crazy this morning as if the hot money knew something good is cooking.

Sox leading

With Sox up over 3.6%, I think NASDAQ will close above 1535 area, which is no longer bearish to me.

Wish

We need a GREAT unemployment number on Friday to sustain this rally, otherwise it is another sucker rally which will kill lots of bulls.

Strong open

I am about to give up my bearish stance. Only some retailer shorts left.

A bull trap?

I don't know, maybe. But I am adding longs, can't resist.

Good things are coming?

I am covering some shorts and buying longs.

Update: NVEC

I am selling NVEC now.

Macy's just disappointed

The retailers are tickering down on this news.

From a shorter's eyes

This bear market started only less than a year ago, now people have already talked about the recovery? This crisis is far worse than the burst of the internet bubble, which took 3 years to truly hit the bottom and was ended by invasion of Iraq. Now the interest rate is down to near zero that means the Fed is out of ammo; or maybe we should start another war? We can't, Americans are extremely poor now, all their hopes are upon China, which has its own problem to solve. Or we can boost some other sectors? Without a sufficient banking system, which one can we boost? Maybe I am just too stupid, I just can't see the light through the tunnel right now.

NIHD

I added NIHD to my newsletter last week.

Morning bounce

We are having the usual morning bounce, which I think it is shortable. What can save this market? I can't think of any right now. Anyone?