[stockstradr]

I never minded the insults from the naively foolish Bulls who pushed their optimism upon everyone here, even as the markets walked up to the edge of the cliff

And I never minded the ranting posts from those so slow of mind that their only strategy is a non-strategy of buy-and-hold, the Non-Thinking Man’s Position.

I didn’t mind because I had faith in the obvious and the inevitable: the markets habit of inflicting righteous justice upon the blind optimists, the idiots, and the amateurs.

Then came Oct ’07 and the inevitable began: the markets’ Descent into Hell.

I started building short positions last year and I kept adding, so when Oct ’07 came I was fully short the market, with LEVERAGE, and with a vengeance.

I bought 2X inverse index funds
I bought a huge amount of PUTS on the S&P500 and NASDAQ
I sold stocks short
I bought gold
I sold the oil & gas index short, with leverage

Then I waited.

Then the market fell about 18% in a matter of months. Gold soared. The oil and gas stocks tanked

Then I laughed all the way to the bank.
🙂

I’m still laughing, and enjoying the ride.
Go ahead.
Post your flaming rants.
I won’t return to this thread to read them.

[stockstradr]

I never minded the insults from the naively foolish Bulls who pushed their optimism upon everyone here, even as the markets walked up to the edge of the cliff

And I never minded the ranting posts from those so slow of mind that their only strategy is a non-strategy of buy-and-hold, the Non-Thinking Man’s Position.

I didn’t mind because I had faith in the obvious and the inevitable: the markets habit of inflicting righteous justice upon the blind optimists, the idiots, and the amateurs.

Then came Oct ’07 and the inevitable began: the markets’ Descent into Hell.

I started building short positions last year and I kept adding, so when Oct ’07 came I was fully short the market, with LEVERAGE, and with a vengeance.

I bought 2X inverse index funds
I bought a huge amount of PUTS on the S&P500 and NASDAQ
I sold stocks short
I bought gold
I sold the oil & gas index short, with leverage

Then I waited.

Then the market fell about 18% in a matter of months. Gold soared. The oil and gas stocks tanked

Then I laughed all the way to the bank.
🙂

I’m still laughing, and enjoying the ride.
Go ahead.
Post your flaming rants.
I won’t return to this thread to read them.

[stockstradr]

I never minded the insults from the naively foolish Bulls who pushed their optimism upon everyone here, even as the markets walked up to the edge of the cliff

And I never minded the ranting posts from those so slow of mind that their only strategy is a non-strategy of buy-and-hold, the Non-Thinking Man’s Position.

I didn’t mind because I had faith in the obvious and the inevitable: the markets habit of inflicting righteous justice upon the blind optimists, the idiots, and the amateurs.

Then came Oct ’07 and the inevitable began: the markets’ Descent into Hell.

I started building short positions last year and I kept adding, so when Oct ’07 came I was fully short the market, with LEVERAGE, and with a vengeance.

I bought 2X inverse index funds
I bought a huge amount of PUTS on the S&P500 and NASDAQ
I sold stocks short
I bought gold
I sold the oil & gas index short, with leverage

Then I waited.

Then the market fell about 18% in a matter of months. Gold soared. The oil and gas stocks tanked

Then I laughed all the way to the bank.
🙂

I’m still laughing, and enjoying the ride.
Go ahead.
Post your flaming rants.
I won’t return to this thread to read them.

[stockstradr]

>>I would rather attribute this short success to the overall market bloodbath

Well, it seems you’re mostly correct on that, as the DJ Oil & Gas Index correlates fairly well to the S&P500 over last three months, except it appears the oil and gas sector index was hit harder falling about 5% more (fell further) than the S&P500.

[Personally, it doesn’t matter to me if the overall market correction was the driver because in Oct ’07 I had A LOT more of my portfolio bet on a downside correction in overall stock indexes than I had in short oil sector positions]

Yes, I also plan to start buying oil LONG at $70/bbl, and accelerate my buying as it nears $60. I absolutely view this recession as bringing the LAST opportunity to buy oil at reasonable prices during the first phase of onset of Peak Oil dynamics

Now the one problem with my little prediction of $60 oil might be say 20% (real inflation, not fake gov. stat’s CPI) inflation on the dollar over the next 24 months and oil prices are set in dollars. Maybe I should qualify my prediction by saying I expect oil will hit $60 in inflation-adjusted dollars during the next 24 months.

One other comment, if there is ANY question if the “pro’s” and non-pro’s have been shorting oil based on predicted recession (demand for oil drops) then just TURN ON YOUR TV or read your newspaper! The short oil pundits have been out in full force in the media now for over a month, although I admit my claim is a little thin that they have been shorting oil since Oct ’07.

[stockstradr]

>>I would rather attribute this short success to the overall market bloodbath

Well, it seems you’re mostly correct on that, as the DJ Oil & Gas Index correlates fairly well to the S&P500 over last three months, except it appears the oil and gas sector index was hit harder falling about 5% more (fell further) than the S&P500.

[Personally, it doesn’t matter to me if the overall market correction was the driver because in Oct ’07 I had A LOT more of my portfolio bet on a downside correction in overall stock indexes than I had in short oil sector positions]

Yes, I also plan to start buying oil LONG at $70/bbl, and accelerate my buying as it nears $60. I absolutely view this recession as bringing the LAST opportunity to buy oil at reasonable prices during the first phase of onset of Peak Oil dynamics

Now the one problem with my little prediction of $60 oil might be say 20% (real inflation, not fake gov. stat’s CPI) inflation on the dollar over the next 24 months and oil prices are set in dollars. Maybe I should qualify my prediction by saying I expect oil will hit $60 in inflation-adjusted dollars during the next 24 months.

One other comment, if there is ANY question if the “pro’s” and non-pro’s have been shorting oil based on predicted recession (demand for oil drops) then just TURN ON YOUR TV or read your newspaper! The short oil pundits have been out in full force in the media now for over a month, although I admit my claim is a little thin that they have been shorting oil since Oct ’07.

[stockstradr]

>>I would rather attribute this short success to the overall market bloodbath

Well, it seems you’re mostly correct on that, as the DJ Oil & Gas Index correlates fairly well to the S&P500 over last three months, except it appears the oil and gas sector index was hit harder falling about 5% more (fell further) than the S&P500.

[Personally, it doesn’t matter to me if the overall market correction was the driver because in Oct ’07 I had A LOT more of my portfolio bet on a downside correction in overall stock indexes than I had in short oil sector positions]

Yes, I also plan to start buying oil LONG at $70/bbl, and accelerate my buying as it nears $60. I absolutely view this recession as bringing the LAST opportunity to buy oil at reasonable prices during the first phase of onset of Peak Oil dynamics

Now the one problem with my little prediction of $60 oil might be say 20% (real inflation, not fake gov. stat’s CPI) inflation on the dollar over the next 24 months and oil prices are set in dollars. Maybe I should qualify my prediction by saying I expect oil will hit $60 in inflation-adjusted dollars during the next 24 months.

One other comment, if there is ANY question if the “pro’s” and non-pro’s have been shorting oil based on predicted recession (demand for oil drops) then just TURN ON YOUR TV or read your newspaper! The short oil pundits have been out in full force in the media now for over a month, although I admit my claim is a little thin that they have been shorting oil since Oct ’07.

[stockstradr]

>>I would rather attribute this short success to the overall market bloodbath

Well, it seems you’re mostly correct on that, as the DJ Oil & Gas Index correlates fairly well to the S&P500 over last three months, except it appears the oil and gas sector index was hit harder falling about 5% more (fell further) than the S&P500.

[Personally, it doesn’t matter to me if the overall market correction was the driver because in Oct ’07 I had A LOT more of my portfolio bet on a downside correction in overall stock indexes than I had in short oil sector positions]

Yes, I also plan to start buying oil LONG at $70/bbl, and accelerate my buying as it nears $60. I absolutely view this recession as bringing the LAST opportunity to buy oil at reasonable prices during the first phase of onset of Peak Oil dynamics

Now the one problem with my little prediction of $60 oil might be say 20% (real inflation, not fake gov. stat’s CPI) inflation on the dollar over the next 24 months and oil prices are set in dollars. Maybe I should qualify my prediction by saying I expect oil will hit $60 in inflation-adjusted dollars during the next 24 months.

One other comment, if there is ANY question if the “pro’s” and non-pro’s have been shorting oil based on predicted recession (demand for oil drops) then just TURN ON YOUR TV or read your newspaper! The short oil pundits have been out in full force in the media now for over a month, although I admit my claim is a little thin that they have been shorting oil since Oct ’07.

[stockstradr]

>>I would rather attribute this short success to the overall market bloodbath

Well, it seems you’re mostly correct on that, as the DJ Oil & Gas Index correlates fairly well to the S&P500 over last three months, except it appears the oil and gas sector index was hit harder falling about 5% more (fell further) than the S&P500.

[Personally, it doesn’t matter to me if the overall market correction was the driver because in Oct ’07 I had A LOT more of my portfolio bet on a downside correction in overall stock indexes than I had in short oil sector positions]

Yes, I also plan to start buying oil LONG at $70/bbl, and accelerate my buying as it nears $60. I absolutely view this recession as bringing the LAST opportunity to buy oil at reasonable prices during the first phase of onset of Peak Oil dynamics

Now the one problem with my little prediction of $60 oil might be say 20% (real inflation, not fake gov. stat’s CPI) inflation on the dollar over the next 24 months and oil prices are set in dollars. Maybe I should qualify my prediction by saying I expect oil will hit $60 in inflation-adjusted dollars during the next 24 months.

One other comment, if there is ANY question if the “pro’s” and non-pro’s have been shorting oil based on predicted recession (demand for oil drops) then just TURN ON YOUR TV or read your newspaper! The short oil pundits have been out in full force in the media now for over a month, although I admit my claim is a little thin that they have been shorting oil since Oct ’07.

[stockstradr]

http://piggington.com/market_call_short_the_oil_sector

This topic has been covered, back in Sept ’07. That should tell you how late you are coming up with this short oil play. Most pro’s saw five or six months ago what you are now apparently just figuring about.

You are late enough to this play that oil stocks are already showing a “bounce” up, having already fallen (about 15%) in thirty days (DJ US Oil & Gas Index, DJ US Oil & Gas Producers Index). Oil is climbing back up off the recent lows. Guys like me have already made plenty of money on this bet, so our risk is much lower.

This doesn’t have to mean you cannot still make money shorting oil, just that your risk is higher as you come late to squeeze a few dimes out of last part of a trend.

Ask youself: “Do I think the coming recession will be WORSE than what is priced into oil sector stocks already? Can I accept the significant RISK of shorting oil?”

I think most pro’s would conclude you are an amateur (no insult intended) if you believe oil will hit $20/bbl. So they would advise an amateur not to play in this oil commodity game which is dominated by pro’s.

Yet I have an instinct we will see oil sink below $60 / bbl within 24 months because this recession will be MUCH worse than has so far been priced into oil sector stocks. I plan to continue holding my short oil positions, but this IS risky.

IMPORTANTLY, understand that shorting oil is one of the riskiest bets you can make because of multiple unpredictable risk factors: war in iraq; terrorists damaging oil delivery systems or production facilities; bad weather destroy production facilities; China oil demand rises instead of falling (no recession for Asia);OPEC doesn’t drop demand, which they are already threatening. Don’t short with more than 10% of your portfolio.

ProShares “DUG” has been an efficient way for me to short the oil sect. However, shorting oil directly may be the best choice at this point, because oil is only $8 below its $100/bbl high, so has fallen a lot less than the oil sector stocks.

[stockstradr]

http://piggington.com/market_call_short_the_oil_sector

This topic has been covered, back in Sept ’07. That should tell you how late you are coming up with this short oil play. Most pro’s saw five or six months ago what you are now apparently just figuring about.

You are late enough to this play that oil stocks are already showing a “bounce” up, having already fallen (about 15%) in thirty days (DJ US Oil & Gas Index, DJ US Oil & Gas Producers Index). Oil is climbing back up off the recent lows. Guys like me have already made plenty of money on this bet, so our risk is much lower.

This doesn’t have to mean you cannot still make money shorting oil, just that your risk is higher as you come late to squeeze a few dimes out of last part of a trend.

Ask youself: “Do I think the coming recession will be WORSE than what is priced into oil sector stocks already? Can I accept the significant RISK of shorting oil?”

I think most pro’s would conclude you are an amateur (no insult intended) if you believe oil will hit $20/bbl. So they would advise an amateur not to play in this oil commodity game which is dominated by pro’s.

Yet I have an instinct we will see oil sink below $60 / bbl within 24 months because this recession will be MUCH worse than has so far been priced into oil sector stocks. I plan to continue holding my short oil positions, but this IS risky.

IMPORTANTLY, understand that shorting oil is one of the riskiest bets you can make because of multiple unpredictable risk factors: war in iraq; terrorists damaging oil delivery systems or production facilities; bad weather destroy production facilities; China oil demand rises instead of falling (no recession for Asia);OPEC doesn’t drop demand, which they are already threatening. Don’t short with more than 10% of your portfolio.

ProShares “DUG” has been an efficient way for me to short the oil sect. However, shorting oil directly may be the best choice at this point, because oil is only $8 below its $100/bbl high, so has fallen a lot less than the oil sector stocks.

[stockstradr]

http://piggington.com/market_call_short_the_oil_sector

This topic has been covered, back in Sept ’07. That should tell you how late you are coming up with this short oil play. Most pro’s saw five or six months ago what you are now apparently just figuring about.

You are late enough to this play that oil stocks are already showing a “bounce” up, having already fallen (about 15%) in thirty days (DJ US Oil & Gas Index, DJ US Oil & Gas Producers Index). Oil is climbing back up off the recent lows. Guys like me have already made plenty of money on this bet, so our risk is much lower.

This doesn’t have to mean you cannot still make money shorting oil, just that your risk is higher as you come late to squeeze a few dimes out of last part of a trend.

Ask youself: “Do I think the coming recession will be WORSE than what is priced into oil sector stocks already? Can I accept the significant RISK of shorting oil?”

I think most pro’s would conclude you are an amateur (no insult intended) if you believe oil will hit $20/bbl. So they would advise an amateur not to play in this oil commodity game which is dominated by pro’s.

Yet I have an instinct we will see oil sink below $60 / bbl within 24 months because this recession will be MUCH worse than has so far been priced into oil sector stocks. I plan to continue holding my short oil positions, but this IS risky.

IMPORTANTLY, understand that shorting oil is one of the riskiest bets you can make because of multiple unpredictable risk factors: war in iraq; terrorists damaging oil delivery systems or production facilities; bad weather destroy production facilities; China oil demand rises instead of falling (no recession for Asia);OPEC doesn’t drop demand, which they are already threatening. Don’t short with more than 10% of your portfolio.

ProShares “DUG” has been an efficient way for me to short the oil sect. However, shorting oil directly may be the best choice at this point, because oil is only $8 below its $100/bbl high, so has fallen a lot less than the oil sector stocks.

[stockstradr]

http://piggington.com/market_call_short_the_oil_sector

This topic has been covered, back in Sept ’07. That should tell you how late you are coming up with this short oil play. Most pro’s saw five or six months ago what you are now apparently just figuring about.

You are late enough to this play that oil stocks are already showing a “bounce” up, having already fallen (about 15%) in thirty days (DJ US Oil & Gas Index, DJ US Oil & Gas Producers Index). Oil is climbing back up off the recent lows. Guys like me have already made plenty of money on this bet, so our risk is much lower.

This doesn’t have to mean you cannot still make money shorting oil, just that your risk is higher as you come late to squeeze a few dimes out of last part of a trend.

Ask youself: “Do I think the coming recession will be WORSE than what is priced into oil sector stocks already? Can I accept the significant RISK of shorting oil?”

I think most pro’s would conclude you are an amateur (no insult intended) if you believe oil will hit $20/bbl. So they would advise an amateur not to play in this oil commodity game which is dominated by pro’s.

Yet I have an instinct we will see oil sink below $60 / bbl within 24 months because this recession will be MUCH worse than has so far been priced into oil sector stocks. I plan to continue holding my short oil positions, but this IS risky.

IMPORTANTLY, understand that shorting oil is one of the riskiest bets you can make because of multiple unpredictable risk factors: war in iraq; terrorists damaging oil delivery systems or production facilities; bad weather destroy production facilities; China oil demand rises instead of falling (no recession for Asia);OPEC doesn’t drop demand, which they are already threatening. Don’t short with more than 10% of your portfolio.

ProShares “DUG” has been an efficient way for me to short the oil sect. However, shorting oil directly may be the best choice at this point, because oil is only $8 below its $100/bbl high, so has fallen a lot less than the oil sector stocks.

[stockstradr]

http://piggington.com/market_call_short_the_oil_sector

This topic has been covered, back in Sept ’07. That should tell you how late you are coming up with this short oil play. Most pro’s saw five or six months ago what you are now apparently just figuring about.

You are late enough to this play that oil stocks are already showing a “bounce” up, having already fallen (about 15%) in thirty days (DJ US Oil & Gas Index, DJ US Oil & Gas Producers Index). Oil is climbing back up off the recent lows. Guys like me have already made plenty of money on this bet, so our risk is much lower.

This doesn’t have to mean you cannot still make money shorting oil, just that your risk is higher as you come late to squeeze a few dimes out of last part of a trend.

Ask youself: “Do I think the coming recession will be WORSE than what is priced into oil sector stocks already? Can I accept the significant RISK of shorting oil?”

I think most pro’s would conclude you are an amateur (no insult intended) if you believe oil will hit $20/bbl. So they would advise an amateur not to play in this oil commodity game which is dominated by pro’s.

Yet I have an instinct we will see oil sink below $60 / bbl within 24 months because this recession will be MUCH worse than has so far been priced into oil sector stocks. I plan to continue holding my short oil positions, but this IS risky.

IMPORTANTLY, understand that shorting oil is one of the riskiest bets you can make because of multiple unpredictable risk factors: war in iraq; terrorists damaging oil delivery systems or production facilities; bad weather destroy production facilities; China oil demand rises instead of falling (no recession for Asia);OPEC doesn’t drop demand, which they are already threatening. Don’t short with more than 10% of your portfolio.

ProShares “DUG” has been an efficient way for me to short the oil sect. However, shorting oil directly may be the best choice at this point, because oil is only $8 below its $100/bbl high, so has fallen a lot less than the oil sector stocks.

[stockstradr]

Regarding the comment on gold, yes I’m also nervous.

I’ve hung onto my ~25% of portfolio position in gold. Yes, I’m very nervous we could see a significant pullback from profit taking, possibly taking gold down $100 or more off the $930+ top. I’m hoping that does NOT happen. In the mid-term (24 months), however, I fairly confident gold will advance above $1200/ounce.

Regarding stocks, I believe the optimists are having some temporary success convincing the markets that the recession fears were overblown. I think index movement over next few weeks to few months will be difficult to predict, until data comes in (April, latest) that completely confirms the recession has started. So, my strategy is to start taking SHORT positions because no matter the fluctions of next few months, eventually Bad News will take the markets MUCH lower this year.

You know what I really wish for? I want some incredibly OPTIMISTIC (but groundless) news to completely dominate for a day, sending the markets wildly UP…and same time lowering the cost of PUT options on the indexes.

On that day, I will be buying puts, right when they are On Sale.

[stockstradr]

Regarding the comment on gold, yes I’m also nervous.

I’ve hung onto my ~25% of portfolio position in gold. Yes, I’m very nervous we could see a significant pullback from profit taking, possibly taking gold down $100 or more off the $930+ top. I’m hoping that does NOT happen. In the mid-term (24 months), however, I fairly confident gold will advance above $1200/ounce.

Regarding stocks, I believe the optimists are having some temporary success convincing the markets that the recession fears were overblown. I think index movement over next few weeks to few months will be difficult to predict, until data comes in (April, latest) that completely confirms the recession has started. So, my strategy is to start taking SHORT positions because no matter the fluctions of next few months, eventually Bad News will take the markets MUCH lower this year.

You know what I really wish for? I want some incredibly OPTIMISTIC (but groundless) news to completely dominate for a day, sending the markets wildly UP…and same time lowering the cost of PUT options on the indexes.

On that day, I will be buying puts, right when they are On Sale.

[Author]

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