Thursday, June 26, 2008


Put up your dukes! I am now in the unenviable position of having to defend my column looking for a market bounce despite all the warnings in it that this is still bear market and possibility that the runup to the Fed was buy the rumor, sell the news, which it apparently was.

Once again, journalist deadlines got the better of me. I wrote yesterday's Barron's Online piece in the morning and had it to my editor at 12:30 NYT - nearly two hours ahead of the Fed. The rally in the financials was hot and things were looking pretty good for that short-term trade. The UYG ETF was up well over 6% at one point, too.

But just like that, the market decided it did not like the whole Fed language thing and turned around. Toss in bad tech earnings and oil that is not falling anymore (not that it ever broke its trading range in the first place) and so much for the financials bounce. And so much for the market bounce, too.

This was not supposed to be a long-term trade. And it was no guarantee. It was just a pretty good bet given support, money flows and sector sentiment.

Am I getting defensive here? You bet! In a Barack Obama-esque way, I want to fend off the complaints before they begin. If you read the column closely, you will see it starts out and ends up with "this is a bear market."

Me-ouch! Dead cats bouncing. Hope springs eternal. Everyone is a contrarian.


Anonymous said...

My condolences! So you're right only 99% of the time -- we still love you. But you should really talk to your editor about deadlines. I think you would be better off writing your column Tuesday after market close for a Wednesday deadline. You've been burned too many times on intra-day reversals (but usually in a minor way).

Anonymous said...

Wow unexpected close! What do you make of a VIX that won't budge while the Dow and S&P accelerate their down turn? Smells like the hedge funds are at work in the "dark pools" to me.

Anonymous said...

Still considering long the UYG? In fact, no heavy volume on the downside today. Oh, CNBC Steve saying that the FED is going to do something.

Michael Kahn said...

The VIX is now moving - bearish! Still nowhere near a bottom, as I wrote in the article.

As for UYG? We dumped that porcine beast at the open. We don't stick around when we are wrong.

Anonymous said...

Fed Explores Steps to Channel
Funds to Cash-Strapped Banks

The bail-out continues, short covering rally?