Global Market Comments
November 1, 2013
Fiat Lux
Featured Trade:
(COVERING SHORTS IN THE EURO), (FXE), (EUO),
(THE CHIHUAHUA GLUT)
(NOTICE TO MILITARY SUBSCRIBERS),
(TESTIMONIAL)
CurrencyShares Euro Trust (FXE)
ProShares UltraShort Euro (EUO)
Global Market Comments
November 1, 2013
Fiat Lux
Featured Trade:
(COVERING SHORTS IN THE EURO), (FXE), (EUO),
(THE CHIHUAHUA GLUT)
(NOTICE TO MILITARY SUBSCRIBERS),
(TESTIMONIAL)
CurrencyShares Euro Trust (FXE)
ProShares UltraShort Euro (EUO)
This short position has been a total home run of a trade, with the Euro going into freefall when the ink was barely dry on the Trade Alert.
Rumors swept the foreign exchange pits this morning of a potential interest rate cut by the European Central Bank next week, which they really should have done a long time ago. Otherwise, the strong continental currency will strangle a nascent continental recovery.
The Currency Shares Euro Trust (FXE) November, 2013 $138-$141 bear put spread has gapped up an eye popping 11.3% in value in just two days. As a result, we can realize 86% of the potential profit in this morning?s market. There just is not enough blood left in this stone to make it worth holding 11 more trading days.
I am not covering my euro shorts here because I believe it offers great value. Au contraire! The Euro is, in fact, facing major long-term resistance at $1.40. If ECB president Mario Draghi does not cut interest rates next week, then you can expect the Euro to take another run at the highs. Then we?ll visit the trough for another drink on the short side one more time. If Europe doesn?t cut rates sooner, it will certainly be later.
I wish they were all this easy. On to the next one!
Recently, I wrote about the Nevadan wrinkle in the housing crisis where distressed homeowners are letting their horses go wild to make their mortgage payment.
Now neighboring California is facing a Chihuahua glut, where evicted homeowners are handing over their pets to animal shelters. The diminutive Mexican canine enjoyed a boom in popularity in recent years, thanks to movies like Beverly Hills Chihuahua and Legally Blonde.
Celebrities, like Paris Hilton, have also helped promote the breed, flaunting one in front of the paparazzi. Animal shelters in the Land of Fruits and Nuts have been so overwhelmed they have had to ship the ultra cute, but utterly useless animals to pounds as far away as Toronto.
Will the unintended consequences of Greenspan?s low interest policy never end? Give the poor Chihuahua?s a break!
To the dozens of subscribers in Iraq, Afghanistan, and the surrounding ships at sea, thank you for your service!
I think it is very wise to use your free time to read my letter and learn about financial markets in preparation for an entry into the financial services when you cash out. Nobody is going to call you a baby killer and shun you, as they did when I returned from Southeast Asia four decades ago. In fact, many firms on Wall Street give veterans applications first priority, because they know they can get millions of dollars worth of training and discipline for free.
I have but one request. No more subscriptions with .mil addresses, please. The Defense Department, the CIA, the NSA, Homeland Security, and the FBI do not look kindly on newsletters entering the military network, even the investment kind. If you think civilian spam filters are tough, watch out for the military kind! And no, I promise that there are no secret messages embedded with the stock tips. ?BUY? really does mean ?BUY.?
If I did not know the higher ups at these agencies, as well as the Joints Chiefs of Staff, I might be bouncing off the walls in a cell at Guantanamo by now. It also helps that many of the mid level officers at these organizations have made a fortune with their meager government retirement funds following my advice. All I can say is that if the Baghdad Stock Exchange ever become liquid, I?m going to own it.
Where would you guess the greatest concentration of readers The Diary of a Mad Hedge Fund Trader is found? New York? Nope. London? Wrong. Chicago? Not even close. Try a ten mile radius centered on Langley, Virginia, by a large margin. The funny thing is, half of the subscribing names coming in are Russian. I haven?t quite figured that one out yet.
So keep up the good work, and fight the good fight. But please, only subscribe to my letter with personal Gmail or hotmail addresses. That way my life can become a lot more boring. Oh, and by the way, Langley, you?re behind on you bill. Please pay up, pronto, and I don?t want to hear whining about any damn budget cuts!
Semper Fidelis!
I am a UH-1Y Huey helicopter pilot in the US Marine Corps. I am currently deployed aboard the USS Boxer as a Forward Air Controller with Battalion Landing Team 1/1, 13th Marine Expeditionary Unit. Our area of responsibility is the Middle East, which is where I?m writing this from now.
I have been a follower of madhedgefundtrader.com for over a year now. A friend of mine from my squadron initially recommended your website to me and I was immediately hooked. I was drawn to the refreshing way in which you neatly tied together financial markets, macroeconomic trends, politics, and just about every other subject you read about in the news. It is a coherent, well-packaged, Theory of Everything which seemed to explain and predict market trends and movements with a grace and accuracy I had never seen before, or even knew existed.
I have always had an interest in investing and the stock market (indeed, just enough of an interest to be dangerous?), but have never seemed to allow myself to ?bite-off? on the image of banking and investing sold by pundits on MSNBC, or in the thousands of get-rich-quick investing books on the shelves of any bookstore. It always seemed like there was some secret that the really successful investors knew which would just never end up in a TV segment, or for sale on a bookshelf.
I was at once impressed and intrigued by the way you were able to step back from the microscope of analyzing price movements and hype in the market, and instead focus on the big global picture and how all of the pieces fit together. This, is art.
It was clear that I could learn a lot of that from you. Right around the end of April though, as your ?RISK OFF? predictions began coming true, I was able to cash in on some successful positions, and we decided it would be well worth our money to sign up for your Macro Millionaire program. Since the first week of May, I have been a Macro Millionaire. I decided to commit 100% to your program and jump in with both feet to try to get the most out of it and have a true shot at success.
I downloaded your spreadsheet for keeping track of positions. I read every article I could find on your website, and a couple of books you?ve recommended. I?ve been able to sit in on your live webinars on three separate occasions from an Internet connection in Djibouti, Africa, where you have personally answered my questions.
I?ve followed every Trade Alert you?ve sent out (as best as I could considering the difficulty of trading stocks on a deployment), and have even begun using the techniques you?ve taught me and your broad market predictions to make a few profitable trades of my own.
I continue to see the greatest value of your product in an education on finance, economics, and the world, which I will carry with me for the rest of my life. You?ve somehow managed to take a whole bunch of topics I?ve been interested in studying, and weave them carefully together to show me a new way of looking at the world, and business. This education alone is worth the fee.
I am on a ship with no phone, but you have my permission to use this testimony in any way you see fit. Take care, and thanks for your efforts.
Sincerely,
Justin Savino-Sullins
Captain, USMC
?Those near 10% annualized yields in stocks and bonds are a thing of the past,? said Bill Gross, the managing direct and co-chief investment officer of the Newport Beach, CA based bond giant, PIMCO.
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