Thursday, July 1, 2010

The Case for an Upside Move

Ok, I putting on my CNBC pundit hat and trying to act all cheery.  Every so often I want to remember what it feels like to be a long only fund manager with 2% cash, who has to cheerlead the market.

Look I run a 3 star mutual fund with -2% annualized over 5 years [Kool Aid Growth Fund (KOOLX)]... I'm killing the S&P 500 by over 0.2% per annum;  plus I have appeared on CNBC repeating the same song and dance (broken down to "keep sending me money, over the long run the stock market always goes up") over 83 times in the past 3 years.  (please do not research what I said the previous 82 times, thank you)  I demand you to listen to my words of wisdom. 

A month ago we sat here, all cheery because Biden and Obama promised us a "super duper" employment report.  Like lemmings we believed them (would a politician lie to us?) (would a politician not have the sophistication to know we would see through 410K census jobs?).  We were disappointed.  All these fast money types sold... something about "technical analysis" or "charts" (I call it voodoo)... I don't understand it.  I just buy quality stocks ... at least 450 of them so I can mimic the market and keep accepting your 401k contributions by finishing +/- 1% of the S&P 500 over 10 years.

Here we are a month later no one expects anything good from the employment report.  Which probably is accurate.  Estimates call for about 100K jobs in the private sector minus 200K lost census jobs, for net -100K.  But what if the census holds onto their people for an extra few weeks?  And we had 200K birth death model jobs? Upside surprise baby!

Aside from that, the market is "cheap" ....especially on 2018 earnings.  Maybe even 2011 earnings based on my trusty dealing with the folk over at Goldman, Morgan, and JPM.  Who only look out for my best interest.  And yours.

I hear fears about "debt" or other such stuff.  Look, in Ben Bernanke I trust.  If he says green shoots, I say green shoots. He has never led us astray yet and his track record is beyond impeccable.  Said so right in that Time story (Man of the Year baby).

I hear all this stuff about "1040" being important.  All I know about 10:40 is its usually when I take the first break of the day (who can look at a computer screen for more than 60 minutes straight?), or maybe go hit some golf balls out on the office lawn.

Now go buy stock, since expectations are low and we're ready for the 2nd half 2010 rally.  Or better yet consider buying KOOLX.  As a paid professional I am better off losing you -2% annum than you are.

Ok...ok maybe not a 2nd half 2010 rally, I'd settle for a +2% move at this moment as these past 2 weeks have been cruel and unusual.  Mostly I want these masses of redemptions coming through my door by the hour to stop. 

Bernanke, please do an emergency rate cut! The bears are ruining America!!

What's that?  Oh... nevermind.  Used all those bullets to smash bears the past 3 years.  Well in that case... QE 2.0 please?  Someone, anyone - save me from this reality.  Attach me back to the Matrix.

Listen.  There are a lot of words I've just said.  What I really meant to say is not only am I not panicked but I require you to change your 2010 IRA allocation to Kool Aid Fund.  Quickly. 

Talking My Book, Long & Strong (always!), Shorting is for Losers at Hedge Funds (and unAmerican)

(on a serious note, is anyone bullish on the jobs number tomorrow?  does anyone expect it to be good?  No.  So when it comes in blah will we sell off on news we already know?  Hard to imagine but anything is possible)


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