Grasperino

You notice this guy on CNBC who is the current star "journalist". You see his book is out on the shelves. No wonder he has the latest word on everything. I don't call that unbiased, just clean business. Call it for what it is, let the buyer beware. If I made a statement without disclosure, I could lose my job, how come reporters have that option?

Now back to our regularly scheduled market, time to take a breather after a 68% retracement of the latest downdraft. I would not be surprised to see a test of 1515 SPX before we make new highs for the move. Still like the short vol play after 3Q earnings, tax selling, and mutual fund distributions. Set up them buywrites.

Hey Delilah

So the market did not crash on Monday, or Tuesday, or Wednesday. In fact, we have held the 1495 SPX level quite easily. With a retest early in the week with afternoon rallies closing out the days. Money managers are busy setting up their end of year holdings. Have you seen MSFT this week? Long tech, out of anything financial seems to be the game.

Speaking of financials, speaking to a prospect the other day, he asked my opinion of a beaten down mortgage company, suggesting he thought is was a buy. I said, how could it be a buy if the CEO just cashed out after they sold a convertible to a larger institution. Hey, I used to watch the CNBC Dennis Koslosky interviews with him sitting in Bermuda also. That stock was a buy at 8 too after crashing from 60, but the CEO was a crook, not a bad business model.

867-5309

So here is the scenario, middle of October, options expiration, news about currency dislocation all over the tape, two middle market baseball teams in the World Series (probably), market coming off new highs from the summer, a really bad selloff on Friday: 1987 redux???

If I was still a floor trader, probably take one of those 10-1 shots here on some cheapy puts. Something like buying a lottery ticket and you know what the last number is. However, now that I work with clients, I am already positioned with some cash and was able to be a net buyer on the day. If there is that "Black Swan" event, our portfolios are pretty diversified and bonds and commodities will do well.

Looking for 1495 SPX to hold, I would start to get nervous with a weekly close lower than that. Buywrites looking real nice here with VIX blowing above 21.

Smoke on the Water

A few things are making me nervous about this market run:

1. Oil making new highs on expanding economy. Wait, I thought oil was a commodity not a consumer staple.

2. An old time naked put seller V.N. has closed up shop again after covering his out of the moneys. Last time he was forced to cover back in 1998, we had a 5% drop the next month.

3. Talking heads confused once again how the market can go from bad to good in a few weeks.

4. No real interest in the MLB playoffs.

I like buywrites on some defensive names here.

Do Do Do, De, Da, Da, Da

No blogs from me because nothing has changed. The trend is up as we make new highs on the DJIA and NDX. Best September in 9 years, Citi trades higher after missing earnings. Bulls still in control. For those with conservative bents, I would sell at the moneys against some longs to pull in some income here. If we rally, then you made some nice gains, if we fail, then you've lowered your basis for a fourth quarter rally.

The Mets got what they deserved. Lollygaggers.

Seems the Yankees are hot, but I don't think their pitching holds up against the Indians.

Yakity-Yak

What? The market rallied? The Fed cut 50bps? Who would have believed this reading all of the so called experts. The charts never lie. Another 1.5% and we are back at new highs. Once again heading into earnings season, if we hold that 1475 SPX level, 1650 is in the cards for year end.

So the Mets are now playing like minor leaguers. I cannot catch a break anywhere. My surprise pick in the NFL this year, the Oakland Raiders. They took Denver down to the wire on the road, I like them make it interesting in the AFC.

All Along the Watchtower

Hurry Up and Wait. That is the tone of the market these days. Did anyone notice the friggin rally on Friday? We gap down 100 and trade up 30. You think the shorts are in charge, I beg to differ. Sure volume is not what it was on the down days, but it never is. Price is the leading indicator on the upside. When we get a close over 1500 SPX this week, then the fireworks will begin. Fed shmed, I see 25bps with "easing" language. That should keep the bull market in tact from a psychological view.

Take a look at the consumer staples charts, they are quite strong as they should be. A falling dollar, slowing GDP, pricing power, all good things. Think about it, are you going to stop buying your favorite soft drink for a $.03 increase? I think not. The wife just bought 3-12 packs for $9.99, last year that deal was $8.99. Less than a penny, but multiply that by a billion and it shows on the quarterly earnings.

Oh by the way, did anyone see the Notre Dame offensive line? Cause they were not in Ann Arbor yesterday. Maybe there is somthing left in Lloyd Carr's tank. I'll take a win over Ohio State please.