I owe you guys a good post. I know I do.

In the meantime, I'll confess that, in my IRA, I've loaded up with ten "battered" issues and have trimmed my DUG (double-inverse on oil and gas) from 2800 shares to 1800 shares.

The other ten long positions are small (about 5k each), but even shortly after the entry the screen is all green. I've got relatively tight stops on all of them, set just beneath the lows of this week.

OOF, seems Disqus is down (again). ARGH! It's a nice system (when it works). Frustrating.

I have zero time, so this is going to be quick.

• I started the day seeing gold and oil down sharply. Good.
• I sold my $XAU puts and ABX puts at handsome profits, as they achieved what I felt were good short-term targets.
• I also sold my CMG puts at a nice profit.
• My portfolio was up well into the five-digits of profits that morning.
• I took my kids to school
• I return, and my portfolio is down five digits because the indexes blew from Dow down 40 to Down up 120. WTF?

So it's time to look at charts and figure out what's going on and make sure my stops are well-placed.

It wasn't that long ago that I'd do one blog entry a day and feel like a champ. This is my 5th posting today, and I'd feel guilty if I didn't get it done. Anyhoo………

I see that the Chinese stock markets are exploding higher again. The excuse this time is that the government – which seems passionately devoted to propping up its local stock market – dropped its "trading tax" by two-thirds. That sounds like a lot, but this tax went from 3 tenths of a percent to 1 tenth of a percent. In spite of what sounds like rounding error to me, that was cause for celebration in China.

I've noticed something else as well – – "calling the bottom" has become a passionate hobby these days. It seems like everyone is convinced that the grueling (10%), extremely long (weeks and weeks) bear market is finally at an end. I offer ABK as a symbol of the danger of bottom calling. At every one of the tinted zones shown below, one could have plausibly said, "prices have stabilized and things are settling down; time to buy!" And you can see what happened each time.

A deeper example of how badly people can get it wrong sometimes is Starbucks. This company, which dropped another 10% after hours today, has been falling for months. But go to Amazon and do a search for Starbucks, and you'll see a mountain of books that tell business people how they can emulate the Starbucks way to forge their own prosperity.

I won't bother showing the OIH graph for a millionth time; it has displaced IWM as my obsession these days. I will tip my hat at the reader who turned me on to DUG, the double-inverse fund. I put my entire IRA into this item, and it's up nicely over a just a couple of days. I could see 20-25% more over the coming weeks, possibly. I've drawn a tiny red line indicating my entry point.

My puts in ABX and $XAU are doing nicely. Gold is really starting to take a beating. I'd consider getting out when it gets down to that purple zone. Until then, I'm holding.

I have a kitchen in serious need of cleaning, and as a Felix Unger type, duty calls. Good night, and I'll see you in the ante meridian.

I am about to get on a plane, so I only have a minute. In fact, I am writing this from a wheelchair at the end of a ridiculously long breezeway at Salt Lake City's airport. No, there's nothing physically wrong with me. It's just the only place to sit.

Anyway, AAPL reported after the close, and it was one big meh. It was down about $5 early, but looking at it a moment ago, it's only down a few pennies. At least it's not a blow-out. And Amazon is getting a few bucks knocked off it it, too. Good.

The ones that really got screwed are all those people that bought way out-of-the-money calls and puts thinking they would "pull a GOOG" on Apple (or AMZN, for that matter).. Surely you know by now that the God of Trading loves nothing more than to laugh his divine butt off at traders. So all those who missed GOOG and thought they'd make it back with AAPL were disappointed. Again.

I'll do my regular post (very) late tonight. Bon voyage. 

The energy analyst returns! One of Slope's readers, a very experienced energy analyst, has been kind enough to once again pen a guest column. As before, if you'd like me to forward a note or simply your email to the Energy Analyst, just drop me a line. Enjoy!

The post on oil received several interesting follow-up questions, which I will briefly address. The first question was on the concept of peak oil. This is a fascinating topic and I have spent several years researching the topic with some of the key proponents. My own view is that the world is not at peak oil yet, but the roof is not that far away, perhaps only 5 ? 10 million barrels per day (b/d) of additional output from an all-in base of approximately 85 million b/d. This is not a lot of up-side. Moreover, the cost of extracting these incremental barrels has sky-rocketed due to a host of constraints including land, skilled labor and materials, all the classic economic inputs, and it takes time to develop these massive projects.  For example, the current cost for expansion of Canadian oil sands is projected to be over $125,000 per barrel of daily capacity and can take 5-7 years from start to finish. The only plentiful input is money, but money can?t change time or geology and it can easily be wasted on the wrong projects. It is safe to say that the era of ?cheap? oil is over.

The central problem the world faces is that demand growth is out-stripping supply growth. For decades this was not a problem as there was significant spare capacity. It is clear that demand crossed the supply equilibrium several years ago. If new supply is not the answer, then the only solution to high oil prices is demand destruction. Unfortunately, the price required to kill global consumption may be even higher than $120. So far, only US demand has shown any weakness. The rest of the world continues to consume more oil y/y, and it?s not just China. Even at $100 plus oil, I project global demand will be up another 1 million b/d this year. Part of the problem is that as US consumption moderates, demand in the Middle East has soared. Makes sense given the financial flow. Moreover, almost all emerging economies (China, India, Mexico, Middle East, Russia, Asia) actually subsidize energy prices. Therefore, there is a greatly delayed global consumer response to higher prices ? the market feed-back mechanism is broken.

If the rest of the world does not cut oil consumption because retail prices are artificially low, then it will be up to the US consumer to cutback because this is the only large market with real-time prices. Ironically, it could take a huge oil price for the US to cut enough demand to off-set growth in the rest of the world ? we might have to experience a lot of pain. Think airlines and truckers. Note that we have provided China with $2 Trillion in US dollar reserves to subsidize low oil prices in that country. So it?s more complex than just a simple emerging market secular demand growth story, which is pretty powerful in itself. I can safely predict that world oil demand would go down if retail prices actually went up, but it is not happening right now. I can also safely predict that China will not raise the price of diesel fuel in that country before the Summer Olympics. Even then, increases will be halting as social harmony is more important in China than is the cost of fuel subsidies. Unfortunately, I think the US consumer will crack before the Chinese government.

One writer suggested that ?something else was going on in the oil market? and, that perhaps a potential issue with Iran was the answer. All I can say, is that there are multiple aspects to the problem ?it is not a ?single?, convenient issue that can be addressed and it all goes away. The market has tried the single answer explanation (inventory levels, hurricanes, Iran, dollar etc) and none of them have worked.  Interestingly, global oil inventories do not reflect evidence of hoarding, or preparing for a US issue with Iran. I do agree that it makes no sense for the US to continue to fill the strategic reserve, but I conclude that it is another example of one arm of the government not understanding the ramifications of its policy actions. Another example is the ethanol policy.