Tuesday, February 20, 2007

Still On Vacay... But a Few Notes

NFI... as expected it has blown up but I admit I was looking for Hiroshima and what we got tonight was a full fledged ICBM 50 megaton hit which will take the company by its own account years to recover from. The remaining March puts that I have will be sold for a very good profit. But aside from my immediate family really cares right? Of far greater concern is the carnage left in the wake of the NFI earnings report. Check the Roubini blog link to the right for a spot on analysis of what's going on in the subprime and how it will spread.

Obvious immediate lesson - investors ALWAYS get what they deserve. Ominous developing lesson - too many thought NFI was best of breed and a blow up of this magnitude couldn't happen to them. Think again. No one is immune when problems snowball.

By the way, I've been on vacation and really neglecting this blog and it's still popping up at #3 on the TopBlogSites ranking. It has been interesting to look at the stats to see a huge amount of traffic from some of the subprime related message boards where the original NFI posts from a few weeks ago warning of imminent danger have attracted attention. Quite funny. Subprime is starting to pop up on everyone's radar screen and the speed at which problems in subprime spread into the higher quality realms of the mortgage world is what will likely determine the staying power and strength of whatever the bulls are going to throw at the stock market in the weeks ahead.

Nat gas - I'm willing to be patient (wrong) for a while longer on my short bet up to the gap range at about $8 and have prepared to roll into the March contract.

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