Saturday, September 19, 2009
This time someone else got left holding the bag. I was able to dump shorts of FAZ and SRS at the beginning of the week thus, letting some other dope hold those worthless options. Unfortunately, I missed my opportunity to take profits on C, and was left with nothing on that one. But that's ok... Even Babe Ruth struck out a few times. The key will be to capitalize big on my hits just like the Babe did when he took those balls out of the park!!! Chances are that I may replay FAZ and FAS shorts again since it appears that this market will rip past 10,000 this coming week.
SLV continues to be the mainstay of my current portfolio. While it started off as a place to hold cash while I prepared more ways to short the market, it turned out to be a bit more of a hedge. I like GLD, but believe SLV has yet really made its move. I do however want to remind readers that SLV and GLD are no where near their all time levels of the 80s. We can remember when the Hunt Brothers made their move to corner the silver market... and almost lost the Kansas City Chiefs in the meantime. Adjusted for inflation... if you would have bought gold at the top of the market you still would be down over 50%.
I do not believe there is any type of a concerted effort to corner any of the precious metal markets these days. However, between advertisements about turning your gold into cash, and even better the bullion centers that will sell you Gold Eagles or bars I was prompted to take action. So I called these Bozos and asked two simple questions... How do I buy gold? (That was the easy question)... The real question I had was... How do people sell their gold once they buy it. That was a bit more of an uncomfortable question. This is where I was told about using a mailing service to mail in whatever gold bars I would have purchased... insured them... and hope that they arrive when gold's price is still up. There seemed to be enough hols in this guy's plan to sink a battleship.
I entered into 1/7.5s on PQ which was one of my darlings during the oil boom. I believe this one could be a home run as well due to the dual production of oil and natural gas. Plus, they are located off the coast of Texas and Louisiana and it thus far appears to have been a more mild hurricane season... I still look for a tightening of of production which will drive prices. Secondly, as the U.S. Dollar appears to be under more pressure, commodities are a natural defense.
I am considering a covered call strategy where I would actually purchase common share of the stock, and place my shares up for options. This is where many of the big dogs play. And, while I do not claim that I am in the same league as the big dogs, I do believe there is a portion of my portfolio that can be used for this strategy.
Call it irrational exuberance, or just plain dumb. Whatever it was, I noted the explosive movement of WYNN and LVS this week. The former could make a reasonable argument for its move through the spin-off of the Maccau operations coupled with a concerted effort in the United States to cater to the more affluent gambler. I am Sheldon Adelson's house is made of cards These stocks will continue to rise as long as the mirage of economic improvement persists. I am sure Vegas will be back on its feet in no time. One footnote is that HArrah's gaming purchased a dilapidated racetrack in North Randal, Ohio once the governor and legislature sold their souls to the devil on slot machines int eh race tracks. I am certain the sale is contingent upon the state winning the lawsuits against several conservative and pro family organizations in the Buckeye state.
Posted by at 6:04 PM