Goodbye Citi

Say goodbye to Citibank as we've known it.  The James Stillman Citi, the Sandy Weill Citi, the first U.S. bank with $1 billion in assets, the inventor of the CD, and once the largest commercial bank in the world will now be 36% owned by the US Government.

A government big enough to give you everything you want, is strong enough to take everything you have.  ~Thomas Jefferson

RSW (147.93)

Yes, it appears as though I let go of RSW far too early.  Paring equities to 13% since that post has helped but the recent lows have obviously been tough to swallow without a hedge.

DOW 7352

NAZ 1428

S&P 766

Big Bear Doug Kass Predicts Recovery

Mr. Kass suggests to Fast Money that investors are not fully considering the impact of recent government stimulus or mortgage packages and that we could be out of recession in about 12 months.  He goes on to say that pessimism is at a fever pitch and that some investors are concerned that the worldwide economies will never recover.

FCX mentioned.

Read More on CNBC.com

S&P 500: 770

Consumer Prices up 0.3%

Consumer prices were up 0.3% in January as a result of increased energy costs.  Though this is the first increase since July it is believed to be short-lived as the slow economy keeps the index muted over the month to come.

Read More on CNBC.com

Bottom Fishing

Some names that caught my eye yesterday:

• SNCR up nicely, +13%, big gap up - maybe it needs to take a breather and settle down to around $9.30, the 50 dma?  Watch closely as it's had a history of this price action since Oct 2007.
  
• GME bouncing off of 50 dma
  
• SIGM Double Top Breakout 2/12/09, pay no more than 12.45

Interesting to note that two of these names had gotten my attention over a year ago.

Out of RSW Too Soon

Getting out of the RSW trade was a little premature yesterday.  Markets are indicated lower today and leaves my 25% in long equity positions exposed.

AutoNation

Gate's Cascade Holds Talks With Autonation; Bloomberg Miles Weiss:

Gates holds over 12% of AN stock while Eddie Lampert holds over 44%.

USA Today piece on the Auto Industry's struggles.  Tom Durant and Classic Chevrolet mentioned.

Todd Sullivan on Autos in Seeking Alpha piece.  Sullivan's interview with Mike Jackson.

Rydex Inverse 2X S&P 500

Out of the RSWs @ 127.13

Stimulating News

News on "stimulus":

$3 Trillion!; AP David Espo

Too Few Details in Bailout 2.0; AP Martin Crutsinger

Stocks Plunge as Government Unveils Plan; AP Tim Paradis

Stagflation A Topic Again?; Washington Post Frank Ahrens

Monstrous Mess by theage.com.au David Hirst

Total Cost of Stimulus is $9.7 million?; Newsmax.com Jim Meyers

Most Say Lawmakers Don't Understand Stimulus; Newsmax.com Dave Eberhart

Stimulus Plan Paves the Way for Socialized Healthcare Plan; Newsmax.com David Patten

Stimulating Downturn in Markets Today

DOW - 403, S&P -45, NAZ -68

With the recent sampling of new positions such as URBN @ 17.76, GLW @ 11.68, AN @ 11.47, AZO @ 144.84, and MOS @48.23 it seemed only reasonable to put on some more RSW @ 118.30 in advance of the "stimulus" vote.

Stops: 

URBN 16 (-9%)

GLW 11 (-6%)

AN 10.65 (-7%)

AZO 133.25 (-8%)

MOS 41 (-15%)

Observations Drafted, Never Posted

FCX above 31.44

MOS, 41.09, 43.10

MON, 87.32

URBN (17.75 +.91)

Snacking a little more Urban Outfitters, currently up 17% for us. Equal Weight.

Unemployment Rate at 7.6%

The unemployment rate edged up to 7.6% topping December's 7.2%.  Payrolls slashed by 598,000 in January the largest decline since 1974.  The street was forecasting -525,000.

This will most certainly fuel a Obama led tirade, ala Christian Bale, onto the GOP encouraging the passing of the "stimulus" package.

DOW 8063

S&P 846

NAZTY 1546

Obviously, it's hard to read the market's reaction to this news and the possible stimuli.  Just get out of the way.

Not!

DLTR, Ready or Not?  Apparently "not" judging by the -$3 opening we're looking at.  Proof positive that you don't speculate, that you trade the market you've been given.  Awesome.

10 AM update: Dollar Tree is getting its face ripped off: -$6.91 (16.56%)

DLTR, Ready or Not?

Dollar Tree closed yesterday at 41.75, the level I'd mentioned yesterday as a possible nibble.  We'll see how it reacts in the face of a negative vibe on the street.  

I won't likely take any speculative position right now but would opt instead for calculated measures.

Tee 'Em Up

Wait for FPL, AZO and DLTR to settle before staging a convincing push through the levels we'd indentified.  There's your entry.  Waiting, watching.

Dollar Tree may warrant a speculative position at the 50 dma around 41 3/4.

Corning (GLW 11.01)

Corning is cutting 3500 jobs worldwide.  Upturning 50 dma.  Building a little momentum but wait for a committed move above $11.59.

SPSY 121.08

Watch for the S&P 500 Financial Sector Index to move up beyond 138/139 before getting excited about financials bottoming.

If you use UYG then it's $4.  Not a penny earlier.

Auto Sales Plummet

Auto sales plummeted to the lowest level in 27 years.  Read Washington Post

A handful of Asian car makers bucked the trend. Hyundai's sales jumped 14.3 percent, Subaru's climbed 8 percent and Kia posted a 3.5 percent gain.

AutoZone (AZO 139.08)

AZO was up nicely today.  Look at the stock's run from the Spring of 2001 to the Fall of 2002.  A committed move through 138 will justify an underweight position.

FPL (52.20)

Despite a Florida in despair and lower revenue the FPL Group reports record profits and the stock is looking powerful.  Worthy of an underweight position with a move through $52 opening the door for an assault on $53.31.

HOG (13.73)

Harley is up big today on news that their unsecured debt paying 15% ANNUALLY is getting support from Buffett and Davis Advisors.

Fund my Mutual Fund commentary

Forbes.com

Southern Company

Out of SO at $33.42.