What a difference a title makes!
Yesterday, I titled my morning post “WTF Wednesday?” and I had, at 5:36 am, already sent out a major Alert (rare thing to do) in which we discussed Raoul Pal’s statement that a major crash is coming in 2 days to 2 weeks, to which I said: “I think it’s insane not to be mainly in cash right now and hedged for at least a 40% drop. If the guy’s wrong – our buy/writes pay “just” 20% and if he’s right, then we get to DD at good prices with the profits from our Disaster Hedges!” As I’m not one to ignore a great opportunity to profit from catastrophy, we added 3 more hedges that pay 1,000% if the market does tank in the next few weeks, or days (using DIA, FAZ and TZA).
I commented that the riots in Thailand may be the first of many around the world and that “Europe is in full panic mode and is hitting the 2.5% rule at 5am, about 11 am for them – very, very bearish if they can’t hold 2.5% in a day and not very good if they finish near that line anyway. CAC must hold 3,500, DAX 6,000 and FTSE 5,175” and we all sang “Smoke on the Water” as we sat back and watched the world burning on the news at 6am. SO – when the futures were UP soundly into the market open, my article title was “WTF Wednesday?” indicating our incredulous take on the move. I noticed on Seeking Alpha, they decided to change the title to Wacky Wednesday – a very different tone and that’s a shame because I think it washed out my stern warning to revisit our disaster hedges, 16 of which I published for free this weekend to help protect the general public.
Having our bearish plays set, we attempted 3 bullish plays in our next morning Alert at 9:46 but those got quickly blown out of the water as the S&P failed our 1,115 line at 10:13. At 11:37, just before we bottomed out for the day, I said to Members: “Well, this is ugly but we couldn’t have a better set-up for a massive reversal on the Fed minutes at 2pm. Not that there’s any real reason for a turnaround on the minutes of a 2-week old meeting but it’s a great excuse to run the Bots as they will have a few pages of text to point to…
