Sunday, 8 February 2009

What a difference a weekend makes...

L: 142%
S: 50%
G: 192%
N: 92%

The Raven has been enjoying the British countryside this weekend and can confirm that the world isn't falling apart, there were no riots in the streets and burning villages.

The Raven is a little disappointed with Friday and has to confess to having fluffed a good opportunity to make some more benji's and has been very conservative. In aggregate he's missed 5% in both of the bank share positions he's owned, made a pig's ear of RIO and topped and tailed himself in LAD. Saying all that its been a good week - phew isn't it nice to own up to your mistakes and shortcomings - now all we need is Gordo and RBS to fully fess up and we'll ALL be feeling a lot better.

Although the Raven would have really loved a huge positive jobs number on a more selfish note he'd have preffered a very very ugly number, on which it would have been great to see a rally. In this case we saw a worse than "consensus" number, yet better than the whisper on the street he'd been hearing. The reaction was a mild positive, although JPMs huge move was uhm interesting as he only participated for the first 4.8%, wooos. The Raven thinks that there was a lot of speculation as to a Bad Bank plan being announced over the weekend. Tax dodging Geitner is Santa with a sack of coal as far as the Raven is concerned, mortgage modifications is not the medicine the banks were looking forward to. As always the devil is in the detail but he still fails to see how this is a real positive for the banking system. (he still likes JPM long term, but with this volatility he likes trading the range and being enough of a coward to live another day).

BARC numbers tomorrow - which should be interesting considering the huge difference between managements open letter and the numbers that Moody came out with during the ratings downgrade. The Raven suspects perhaps both parties are right, BARC is going to announce great earnings - but also large downgrades, the question is what the net result will be? The proof will be in the pudding, and we'll see whether the management were talking up the stock.

Its pretty hard to trade the shorts right now as the market is obviously getting quite scared of being short, witnessed by his upside calls actually richening in vola levels as the market has risen (that is definitely an atypical move). The current delta on the book suggests to the Raven that he should continue to be a coward (as it feels like the hardest thing to do) and start to sell delta into rallies as it seems impossible to hedge it with profitable short ideas.

Its a blank slate for Monday - apart from the fact he still hates gold.

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