May 31, 2012
One more time...
The European "Crisis" is over...
Yes, we will continue to have a steady stream of headline stories about Greece, Spain, Portugal and just about any country even remotely connected to Europe, but I firmly believe 150% of the supposed impending disaster is TOTALLY, TOTALLY, TOTALLY “IN THE MARKETS”.
We have played this story forever and I will tell you IT DOESN’T MATTER…If you ask, “How can you believe that? What about all this stuff about banks going under and whole countries unable to pay their bills? What about the run on banks in Spain?” etc., I will just ask you to think back to March, 2009, and remember…really try to remember…how INCREDIBLY hopeless the whole world looked then…
Do you remember how DISMAL it was then? How the financial system was actually perceived to be at risk of collapse? That major banks could be going under? How people thought the Dow was headed for 4000? Or worse? How there was NO HOPE?...But look what happened...The Dow has doubled since then---and I would add, the economic "professionals" have hated/doubted it the whole way)---But my real point is: March, 2009, is exactly where Europe is today. In spite of all the unceasing drama in the media, I will tell you, again, for all purposes related to the markets, the European “crisis” is now in the rearview mirror…
This whole thing has created what I honestly consider to be the greatest Treasury Bond trade ever. I think Bonds at 150 would be like Crude Oil at $200.
I am buying puts on Bonds and think they have the potential to produce truly monumental, mouth watering returns…It goes without saying, this is my opinion and I may be dead wrong, meaning you will lose money, but I do think this is one of the most incredible trading situations I have seen in my 33 years in this business.
IGNORE ALL THE MEDIA RHETORIC AS TO THE “GRAVITY” OF WHAT EVERY NEWS FLASH OUT OF EUROPE MEANS. THE WORLD IS NOT FALLING APART. AU CONTRAIRE.
SHORT TREASURY BONDS. TODAY.
Do SOMETHING with this…I don’t care what put option you buy (143 puts at 1 05 = $1080, for example), I think it will make money.
As always, I am obligated to say the strength of my opinion does not mean I will be right…
DO IT. PICK UP THE PHONE AND CALL ME…