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Friday, July 17, 2009

It Pays, to Pay Attention ...

"Coincidence is the word we use when we can't see the levers and pulleys." - Emma Bull

I read this headline today on the BBC News:

"CIT, the troubled American bank, has said it is in talks with "potential lenders to secure financing".

Shares in the firm plunged on Thursday, as analysts warned investors should brace themselves for CIT's collapse"

Hmm. A just a few days back, on this blog on July 1st? We had this little tidbit:

"Edit Update: With due credit to Karl Denninger for catching the overnight lending action at the Fed? I'm not going to be shorting any metals (the metals, in this environment = fear), and I may be picking up some puts on equities.

Could be a lot of fear getting ready to hit the market."

Do I think there is a connection? Yes. Can I prove it? Of course not. Some of the anecdotal stories I could relate of people still getting loans from this bank would make the hair on the back of your neck rise. Do I think there was really any way to 'play' that profitably? In hindsight, no. It did save me from trying to short the metals any further.

I just think it's very, very profitable to keep your eyes on all of the pieces of data. It wouldn't make much sense, to try to play a game of chess, and ignore the opponents knights.

Edit: Also thinking of Index puts today, and possibly also for the Challenge Project ...

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Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 13 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

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