Bear Market?

Nobody told these stocks:

Autozone (AZO)
Netflix (NFLX)
O'Reilly Automotive (ORLY)
Family Dollar (FDO)
American Italian Pasta (AIPC)
Genentech (DNA)
Amazon (AMZN)

Simply Put, "Paulson is The Man"

Very interesting article on hedge fund manager John Paulson.

http://www.portfolio.com/executives/features/2009/01/07/John-Paulson-Profits-in-Downturn

This has got to be the trade of the year, maybe decade:

Long before the financial crisis hit, Paulson, according to one person briefed on the trade, invested $22 million in a credit default swap that eventually paid $1 billion when the federal government opted not to rescue Lehman Brothers. That amounts to a staggering $45.45 for each dollar invested. -(Conde Nast Portfolio)

20 Year Charts of the Major Indices

S&P 500

Dow Jones Industrials

Nasdaq Composite

Stocks Holding Up in this Current Market

Visa (V)

MasterCard (MA)

Amazon.com (AMZN)

Visa (V) & Mastercard (MA)

Visa

Mastercard

Mastercard (MA) & Visa (V)

Mastercard

Visa

Reported 1st Quarter results on Wed., Feb. 9th. Posted earnings of $0.74 cents a share vs. estimates of $0.55 cents a share. Net income rose 35% to $574 million, compared to $424 million in the same time period last year. Net operating revenue rose 17% to $1.7 billion. Total processed transactions rose 8% to 9.8 billion. Adjusted operating expenses fell 4% to $728 million due to the company cutting its professional and consulting fees and administrative costs. Has a net profit margin of 33.01% and a return on equity of 10.48%.

Nasdaq Composite

The IV Horsemen Are Back

Apple (AAPL)

Research in Motion (RIMM)

Google (GOOG)

Amazon (AMZN)

Getting back on track

It's about time I put up a new post. It's been over 3 months since my last one so I figured, eh, what the heck. As far as the markets go, volatility is the name of the game.

Apple (AAPL) released earnings today, their stock shooting up over 11 points after hours. Apple was hovering at a 52 week low near $78. It is now trading above $90. Several traders were using the $80 level as support. If Apple traded below this barrier for a couple days then that would have been a signal to start shorting the stock. Amazing what earnings can do.

IBM reported really good earnings last night. Their stock shot up over 11% today. Other tech notables doing well today are Google (GOOG) and Research in Motion (RIMM).

Dow Oversold?

Global Meltdown

Obviously we are in the middle of a global financial crises. It doesn't take a genius to figure that one out. The markets are playing limbo with each other, seeing who can go the lowest. So far this morning, European markets are down roughly 5%, Asian markets are down about 8%, and Japan is down 9.4% (the biggest single day fall in 21 years). Trading on both of the Russian markets has been suspended, one until further notice and the other until Friday.

This is all seen as a ripple effect after what happened in our markets yesterday. The Dow has dropped 875 points in two days, closing at its lowest point in 5 years. The Dow is now 33.3% below is record close of 14,164.53 it set last year.

Rate Cut

The breaking news this morning is that the Fed cut its interest rate from 2% to 1.5%. This is being done in an attempt to prevent a global economic meltdown (too late). Along with the Fed, the European Central Bank cut its rate by 0.5% to 3.75% and the Bank of England cut their rate by half a point to 4.5%. The Central Banks of China, Canada, Switzerland and Sweden also cut their rates.

The rate cuts will reduce borrowing costs for Americans who have home equity or other floating rate loans tied to the prime rate.

DUG

DUG- Ultrashort Oil & Gas Proshares. Corresponds to twice the daily inverse of the price of the U.S. Oil & Gas Index. Currently testing support as it touches its previous high. Look for a possible handle to form, maybe a 7-8% decline. If no handle is formed and the stock breaks through support on heavy volume, then think about buying shares.