Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

The Action Zone

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My precious metals puts and shorts are doing well (it's about time, too; I definitely got into those a few days too early!) My largest position, DZZ, I luckily bought only yesterday. In spite of being an "ultra" bearish, it's only up half as much as the $XAU is down (I realize that isn't its basis, but still……….) All the same, it's a pretty good day so far.

The ES has massive supply in the low 900s, and that zone currently represents serious resistance (and, if all goes as I think, could be an important launching-off point at the beginning of 2009 for our sucker rally).

Gold continues to seem quite vulnerable.

My stab at bonds (puts on TLT, shorting LQD) was a bust; bonds seem to be the new bubble, and I'm going to avoid that sector for now.

Kill the Messenger

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All I did was listen to the fates; I blew up the United States! – Was Not Was

I received this email from a reader this morning; I've boldfaced some of it:

We all know you are ultra-bearish, but today you said "it is the result of the
Bush/Bernanke/Paulson plan that will, in my opinion, bring the current
embodiment of this country to ruin."So while I'm sure you're planning on making boatloads of money in the
downturn, if the country is going to lie in ruin, what good will it do you? What
do you see coming out of this forthcoming recession/depression? Do you plan to
just throw all your profits in Euro's and skip off to Switzerland? I'm just
trying to figure out what your mindset is if you truly believe that the
forthcoming downturn will cripple the entire country.

Let me say at the outset that although 2008 has been far and away my best trading year ever, I am not immune to the Recession/Depression.

  • The vacation property I bought in 2006 has probably lost nearly half its value;
  • My residence – which not long ago probably could have fetched nearly $5 million – probably will bottom far, far beneath that peak price (were I a single fellow, I'd have sold it a while ago, but I bought the house long ago cheap and, frankly, we're happy here);
  • My incentive options are down about 90% in profits from a year ago

So don't get the idea that I'm just dying for the U.S. to burst into flames. I used to really love what this country was about, but we have strayed so far, and been so foolish, I think we're basically suffering from the sins of those that gorged themselves on completely undeserved riches (look at this morning's front page of the New York Times about the billions in bonuses paid to investment bankers based on profits that were never really there).

I think this is all about the "Kill the Messenger" phenomenon so common in humans. I don't like the fact the U.S. is past its prime; I don't like where the economy is heading; but as a relatively intelligent person, I try to observe what is around me and base my decisions on those observations.

Just to be clear, I do NOT consider this a "jerk email" like I get from time to time; the person writing it genuinely wanted to know my opinion; he was not bashing me. But I thought I should respond to the group, lest some of you think I get excited about the ruination going on around us.

My duty is to the protection and well-being of my family. Not to you. Not to the country. Not even to myself. So I will continue to observe, decide, and act to the best of my ability.

Stumble Down to Year’s End

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With a mere 9 trading days left in 2008 (two of which are before major holidays and, as such, will be pretty much dead), the balance of 2008 will be people biding their time, waiting for this wretched (for most) year to be finally over. Just about the only major reports coming out are the GDP next Tuesday and Durable Goods Orders the day following. The rest of 2008 is probably going to be quite the snoozer.

The real "juice" to the wave 4 rally will be in January. It would be somewhat poetic if it peaked on Inauguration Day, when maybe it will occur to people that Obama isn't Jesus Christ. That realization might take a few weeks, though; however long it takes, that'll be the peak of wave 4, and then it's time to par-tay again. Between now and then, this will continue to be an ungodly tough market to trade profitably.

The interest rate market has, as we know, entered the undiscovered country of 0% rates. The insanity of 2008 has inured people to the madness going on about them. This graph should be the stuff of science fiction. Instead, it is the result of the Bush/Bernanke/Paulson plan that will, in my opinion, bring the current embodiment of this country to ruin.

That'll take a few years, though. In the meantime, I am intrigued that in spite of the EUR absolutely exploding higher………….

……….oil is doing squat. Indeed, oil had two huge advantages – – one, the EUR/USD surge, and two, a 15% cut in production announced by OPEC over its past couple of meetings. So what did oil do today? It went down! WOW.

My view is as follows:

  • Short-Term (the rest of 2008) – bearish, but with a healthy dose of long positions purchased earlier this month (my "long shots")
  • Medium-Term (January, maybe February) – bullish, but secretly rubbing my hands together, waiting to pounce
  • Long-Term (from whenever the public realizes that BHO isn't JHC on forward) – the lovable bear that you adore

And with that, my beloved readers, I bid you a good evening. (Tim vanishes in a mysterious cloud of green smoke………….)