BAGAKOAA; 11 April 2012 The Answer My Friend . . .

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April/2012

Ok I got stuff from a few "close" friends who said I still bored you with laundry stories even after promising not to. Then they said they were glad I was not talking about gunkers. This is getting to be a tough crowd.

 

Now I told you I was going to go fishing today. Well, the first thing you do not want to hear when you arrive at your favorite fishing hole is, "You shoulda been here an hour ago!" I would have been there an hour ago, but this thing called work got in the way.

 

By the time I got on the water we had a prevailing wind of about 30 miles per hour with gusts up to 45 MPH. Now I was using a light rig (#3 WT for you fish whisperers.). I went directly across the river in my new wading boots. They worked great and gave me a lot of stability as I crossed the river. I now had the wind at my back and was using a technique called dipping. Since I could not back cast with the gusting wind (God knows I tried John, I really did.), I just lifted my line out of the water and wind would float my variety of flies almost to where I wanted them.

 

Now when a 40 MPH gust hits you while standing in the water, a lot of things could happen. Here is a picture of this thing called a net.

It is there so you can handle the fish while doing the least amount of harm to it. With gusting winds of 40 MPH it becomes a bit of a weapon, whipping around your shoulder and striking you in the left and right temples depending upon which way you are facing. Here is a picture of the net sneaking up on me today.

 

So what were the fish hitting on today? The Answer My Friend . . yes it was blown in the wind. I went through about 7 flies in two hours. Then a huge gust of wind almost blew me off a perch and into the 41 degree water. I managed to keep my balance but not before my hat and my cheaters (Little magnifying glasses that attach to your hat and allow you to see teeny tiny flies while you tie them on your teeny tiny tippet material. They can also be used to burn unwanted hair off your face if you turn towards the sun and try tying a fly the magnifying glass forms a focal point of energy and will start your beard on fire, or so I've heard. But I digress.) went flying into the Middle Provo.

 

That was God's way of saying, go home and finish the laundry. So I did.

 

The family went to the Salt Lake City zoo and I am waiting here at home writing this wondering when they will be home. Ok they came back now. They had a great day and they saw all the active animals and my wife actually talked to a tiger. I will show you the video once man child has produced it and published it.

So we had a good day in the market. Yay, we should all run out and buy our favorite stock, right? Not so fast. Let's take a look at why the market went up.

 

There were three reasons why we had a 90 point up day on the DOW. Can you name them? The first two are easy. AA Alcoa beat earnings estimates. (Let's forget the fact that analysts have been lowering their expectations since the last announcement. Oh yeah let's forget the fact that aluminum is up about 18% in price over the last six months. And it is not important that the demand from the aerospace industry was unusually large. Let's just celebrate the fact they beat dismally low analysts expectation and the CEO said we could see more of the same.

 

Second reason? The European Central Bank became suddenly aware of the effect their comments about no more bailouts had on the market over the last five days and said, "Well, maybe, we could float a little more bad debt to any idiot that wants to buy it." (Note it was maybe. That is why Spanish and Italian bond yields came down a bit) Those were the two easy ones. Anyone want to guess what the third one was? Hey we had been in a down market for 5 days. It was time for an up day.

 

So for those reasons the market ignored an unexpected jump in import prices and a lackluster mortgage applications report. Money flowed into treasuries keeping the 10 year at or below 2.00%.

 

We are not out of the woods yet. The Red Flag is still flying and we need to see a follow through day before we even think about a positive upward trend. 

 

In the portfolios today.

 

MSFT hit our 30.25 stops and it got almost everyone out of their positions. MSFT will stay on our watch list and we will wait for a better market and a new entry point. Our gain on MSFT was 8.2%. It was a sizeable position. Most of the other portfolios (except for the newest) saw 4-11% profit.

 

That only leaves us with a few CORE positions left. CELG, XOM (Yes we cash out everyone else, but we are having fun selling calls against out position and will do so until we get called away), AAPL (DOJ is picking on our favorite stock for price fixing e-books with a slate of publishers.) BRK/A, and ACET.

 

We are 31% bonds right now and we are 30% cash. CORE equities account for 36% of our balances. The balance are some speculative stocks like ASXSF, GNTX, and LQMT. We will be scaling back more equities soon and looking once again at GLD and GLD options. As import prices escalate, we should see some goosing in gold.

 

Salve Lucrum 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brian Ireland
 
Since 4/5/2012
BAGAKOAA;

I am not a professional investment advisor. Anybody reading my blog and investing accordingly must be out of their minds. I have made more money than I have lost. There are many more qualified people than I to actually tell you how to invest your money.

BAGAKOAA=Boys And Girls And Kids Of All Ages

Salve Lucrum=Latin for Hurrah for Profit.

2012 Year Ending

Dow 13,073

S&P 500 1,358

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