Two good reads this AM

Tatro Capital on Garmin

Ben Carlson

What have I been doing?

I have been taking profits off the table, and retreated back to minimal long equity exposure. I am starting to build a short position in the general index as a hedge with a plan for covering if the SPY gets above 219 again.

A SPY break below the 216 level will encourage me to add to short side index exposure. A  successful test and bounce off that level will turn me bullish again.

Do I care about the fact that interest rates may rise in December?  Not my job.

I only care to see how the institutional investors move the market  and to join their directional call.

Only price action matters to me in the market.


Yield Hog

Interesting read here:

The Mad Scramble For Yield Ignores A Real Risk Of Financial Loss


The average credit rating on U.S. corporate debt? Junk. In fact, three quarters of corporations have experienced a junk-level rating of single-B.

It gets worse. The leverage ratio, “debt-to-EBITDA,” demonstrates that it would take the typical S&P 500 company more than two and one-quarter years to pay back its obligations. Corporations have not been this over-leveraged on this measure in the 21st century.

“2016” by Kass

It pays to stay with the trend, and many will say that the fear abounding will guarantee a continued march higher up the wall of worry.

Who knows.

I just go where the market goes and avoid trying to predict the future.  My fortune telling skills are lousy.

Read the below linked to point of view from Kass.

“2016 Will Be No Fun” – Doug Kass Unveils 15 Surprises For The Year Ahead

“Once again, I’m taking on a decidedly negative tone — suitable to in my old early 1990s role as “The Bear of Boca.” I’m basing my bearishness on a backdrop of continued heinous acts of terrorism, economic and profit disappointment and the general gloom and doom that’s immersing our citizens and our markets.”