Jim Cramer flips out on CNBC. Priceless video (via Barry Ritholz).
Actually, I am worried. Friday’s NASDAQ close was ugly, Bear Stearn’s conference call about how they have no money to buy back stock, they need all their capital to weather the worst corporate debt market “in 22 years” freaked out everyone. Credit where it is due, The Dealmaker’s doom-laden canteen gossip turns out to have been a bit closer to the mark than Felix’s sanguine theorising (and er, mine, but let’s see what happens). However of course, there is no new credit, the debt markets have shut down, (which is the problem) so TED will have to wait to get his.
Some random thoughts, in the order thrown up by the stream of consciousness:
- Do not dismiss Jim Cramer, as Barry’s commentators seem to. He might seem like an idiot but he is not. This man made himself rich picking stocks. I’ve followed him for 9 years and he has been righter on the big things than anyone else I have read. He is the anti-Lex.
- My colleague picked a great time to go on holiday. I’m supposed to be fucking relaxing. Bugger.
- Thank god we’ve been adding a little bit of index put here and there as we went up. But is 35% hedged in puts and cash enough?
- We’re so oversold! VIX is so high! I bet if I add any more hedge we’ll rally bigtime and I’ll get my butt kicked. I’m not paid enough for this.
- I hope Taleb’s fund starting trading already. If so, I hope this is not true of his current positioning: to generate short-term returns during times of low volatility, he also sells options very close to the current price of a security.
- Am I worrying too much? I picked a great time to start reading the Bookstaber book on imminent, regular financial crises, which TED himself refers to here. Sort of like reading a medical textbook in the first throes of a cold or flu — do you know how many fatal diseases start out with simple flu-like symptoms? Ebola, for one.
- Perma-bears are STILL NOT WORTH LISTENING TO, even if we drop 20% from here; remember, stopped watches are right twice a day.
- It might be a great time to be a selective short, even after the reflexive puke of stock which I fear this week, and into the inevitable sharp rally at some point to come. If debt markets really have shut down for corporate issuers, the “private equity put”, which has foxed the shorts on a ton of crap companies, will have gone away for a bit. This likely also means bad news for companies with activist investors who have taken, or were planning to, major stakes with borrowed money. Motorola, this means you.
- Is Xanax addictive?
Bento, are you alive, have you been kidnapped by the Cartesians?