Twister

The Federal Reserve is said to be ready to announce the implementation of "Operation Twist" some time on Wednesday.

Fueling speculation that something big was brewing, former Federal Reserve Chairman Greenspan was seen entering the building, albeit with Elvis. AS it turns out, he was there for a haircut and sometimes a haircut is just a haircut.

Ultimately, by exchanging its short term portfolio of holdings for longer range debt instruments “Operation Twist” is hoped to bend the yield curve.

Although I've seen the visuals many times over the years and can probably understand the concept behind "inverted yield curves", it's like "contango". I know what it means, or at least am capable, but due to my disinterest in the topic, I choose to not clutter my mind with the meanings of those terms and phrases. I can't begin to tell you how many times I've actually looked up the definition of "contango", yet it still has never taken root. It's almost as if the my future memory bank is more highly respected than its current state would give it the right to be.

Contango. The word itself brings giggles to mind. I just can't remember why. 

In an earlier blog, I admitted that "I don't understand currencies". I can just as easily say the same thing about debt instruments and bonds. I've never really tried to understand this very important aspect of investing. Sometimes its hard to know whether my disinterest in bonds and currencies comes from lack of intellect or just true lack of interest, as I perceive them as intangible and somewhat boring. I don't worship at the feet of the PIMCO altar and I don't find stamp collecting all that exciting.

I know that they are anything but, yet I can't find anything persuassive about them to garner even faint interest. But there is probably hope, because last night I watched the premier episode of the new "Two and a Half Men", never having been interested in the original version.

This "Operation Twister" though, has caught my interest.

During Jim Cramer's interview of Treasury Secretary Tim Giethner last week, Cramer asked why such a strategy wasn't being pursued. taking advanytage of historically low interest rates. At that point, the clever name hadn't been publicly applied. It was just another conceptual approach to managing debt and markets and really meant nothing to me.

Cramer then seemed genuinely surprised and for a brief second seemed to be speechless as Geithner indicated that such a strategy might actually find its way into the arsenal.

You neither see that, nor the resultant silence from Cramer on very many occasions. It's true when they say that silence speaks volumes.

The concept does seem to make sense, as long as there are buyers for the long term notes, but yet, it's an untested strategy, at a time when the Federal Reserve seems to be running out of things in its quiver.

The problem with most ideas, whether they are economic issues or otherwise, is the occurence of unexpected consequences.

No one really knows what will happen if the yield curve is drastically altered. Certainly, no one buying a 30 or 40 year note has any clue as to what the rate environment will be at that time, much less next year. Hell, you don't even know who the lead in Two and a Half Men is going to be.

I know that I wouldn't be investing in a 30 year note during a period of all-time low interest rates.

Now flip the scene, and make believe that it's 1979 and interest rates are 17%, then I might have a different opinion on locking into those kind of rates.

My attraction to Operation Twister may be solely related to its namesake, the game "Twister", which made its debut during my childhood.

Talk about unintended consequences.

I think my first sexual encounter may have been on a spin of blue, but it's difficult to say who exactly the reciprocal party was.

Although "Don't Ask, Don't Tell" has officially gone into the sunset, I might be inclined to invoke it for that long ago game of Twister.

Since I don't really understand the world of interest rates, I have no idea what the unexpected consequences might be, but drawing from the game, collapse is the end game.

Collapse is exactly what seemed to happen today and turned a 150 point gain into one 140 points less.

Instead of selling lots of call contracts as I had envisioned, I only sold a few and added to my shares of the ProShares UltraShort Silver ETF and Riverbed Technology.

From my perspective, there never was a 150 point gain, as I had one of the worst days ever, compared to the indices. It didn't help that I was now more heavily reliant on the likes of Freeport McMoran and Mosaic than ever before.

The source of the collapse was said to be "The Troika" and its inability to come to some agreement that would have released the $8 billion traunche that Greece needed to help it further into the hole as it prepares for its inevitable default.

You know, the one that everyone seems to be happily ignoring because that can is maybe as far as 3 months down the road.

The so called "Troika" consists of the IMF, the EU and the European Central Bank. They hold the cards, but apparently can't decide whether to deal in a clockwise or countere-clockwise direction.

As Operation Twister comes into play, some Troika members may regret treating Treasury Secretary Geithner so shabbily during his vist to their recent meeting in Poland. They could have listened to his wise and sagely advice and could have switched over to a spinner and let the cards fall where they may, as they could then watch the arrow determine Greek's destiny.

Ultimately, it doesn't matter whether you spin the wheel clockwise or counter-clockwise, so certain areas of dissent are immediately resolved.

The goundrules could be very simple and definitions readily agreed to.

Blue for no more government hiring

Red for increased retirement age and so on. They may even want to throw in that taxes should not just be levied, but they should be collected, as well.

But no matter what, every game of Twister does end the same. I don't remember whether there was a "winning" scenario. Surely Twister was first popular long before Charlie Sheen, but even then the concept of "winning" must have existed.

Instead, every game ended with the inevitable collapse accompanied with lots of laughs and the feigning of embarrassment by some.

Some actually reached their peak maturity level in the pile.

In this case, I don't think there'll be any laughing. I doubt that there'll be any embarrassment either, as certain egos, particularly those associated with politically appointed positions, don't allow public displays of embarrassment.

They do allow for finger pointing, though.

No matter what, those fingers will probably point in our direction, as undoubtedly our banking crisis just greased the pole for southern Europe and Iceland, Ireland and others, as well.

Ultimately, only a winner take all game of Twister will be able to sort it out at the highest levels.

A repeat of the Berlusconi - Hillary Clinton match would be interesting. It's just so unfortunate that Dominique Strauss-Kahn can no longer suit up (or down) in preparation for game match. You could probably get enough people to pay good money to see him in a good healthy game of full contact Twister to make a dent in the EU economic mess.

Happy to help.

Trading Places

Here it is, Sunday afternoon.

Watching football, having already gotten my week's fill of cholesterol in just one night and feeling pretty good.

Whenever I hear that phrase. "Feeling good", I always think of that great Eddie Murphy - Dan Aykroyd film, "Trading Places."

I can just hear the lines: "Looking Good, Biily Ray!" and in response,  ""Feeling good, Louis".

And what's not to feel good about? After all, Eddie Murphy is trading frequenting transvestite hookers for hosting the Academy Awards.

Life really is good.

And it's especially looking good for the United States, at least as far as our emotionally beaten down egos are concerned.

After a few years of the world thumbing its nose at us and deriding us for our dysfunctional political system and profligacy, it now seems that we've traded places with Europe.

On top of that word has just come out that Dominique Strauss-Kahn has admitted a "moral failing" with regard to his tryst with the hotel maid. As a result we may not need to feel terribly badly about an injustice being done to the ex-IMF leader and may be shielded from some overseas criticism of our justice system jumping to conclusions.

Imagine, it's been a few hundred years and they still can't cope with the little squirt of a brother growing up.

Not that I had felt terribly badly, anyway and not that things are running along entirely smootlhy on this side of the Atlantic. With the exception of baby kidnappings and other trampling of human rights, things still seem to be better with our Chinese "friends", who gve us a market lifting gift just by being part of the rumor that they might purchase Italian debt instruments.

I hope the Italians do better with the Chinese than they do with me.

I just received 5 mailings regarding traffic violations from a trip to Italy 3 years ago.

That was the same trip that the car rental agency tried to hit me with a $2,500 charge for damages.

Oh those whacky Italians. Wouldn't trade the experiences for anything.

But watching economic events in Europe unfold is the true definition of "schadenfreude." It's one thing to have the twp predominant political parties in the US act in a dysfunctional manner, buut when you have the EU's 27 member states trying to figure out how to divide the bill and who deserves how much vacation, you're talking some real dysfunction.

At least they're all agreed on retirement age and loan collateral.

It was funny hearing Treaury Secretary Geithner characterize his trip to Poland for the EU Finance Ministers meeting to be on the basis of an invitation, particularly since all news outlets reported that his "hosts" greeted him rather cooly.

European Finance Ministers apparently don't like to be told how to run their economies by a guy sipping directly from a box of red wine while dining on trout meuniere in his ripped boxers.

That may be a bit of an exaggeration, but so far I haven't seen or heard anything to contradict that characterization of events, so I'll stick with it. Given what could have happened on Geithner's watch and what didn't happen, maybe they should try the red wine instead of the Kool-Aid.

So with all of that as a backdrop, last week was a great week. Stocks traded places with precious metals. I own stocks and am short precious metals, so iy was a great week.

Surprisingly, perhaps surprisingly only for me, Friday was yet another up day in the markets given that there really wasn't any encouraging news coming out of Europe. In fact, if anything, even though the news raised prospects of a breakdown in the agreements necessary to temporarily rescue Greece, our markets shrugged it off.

Gold and silver on the other hand reacted precisely the way you would have expected in the face of uncertainty and the potential for a Greek default heightened. Earlier in the week, they also reacted according to script and had dramatic moves downward as an agreement appeared to be in the works.

No matter, so what if people felt confident going into the weekend holding large positions?

But I was happy.

Most of all and best of all, for me, a devoted call contract seller, Monday starts the October options cycle.

In that regard, September was nothing to remember. It was the second worst option premium month this year, fresh on the heels of the second best options month I'd ever had. Still, using my patented 1964 Color TV metric, I needed to find room for 39 new TV's.

But as a good sign, despite the feeble option income stream for the Septmber cycle,  I'll have plenty of opportunity to redeploy funds form assignments. Almost half of my holdings will be turned over, with most of them closing Friday within 1% of their strike prices.

When that happens, I love to see a down open on the first Monday of the cycle. There's nothing better than getting those same shares back at less than their previous strike prices. But beyond that, there's nothing like selling call options during a market peak. Grab those higher premiums, then close the lopp and start again.

I lost portions of my Bank of New York, Textron, Dow Chemical, DuPont, Williams Sonoma, British Petroeum, Deere, Home Depot and Transocean shares

If the past is any indicator, I'll probably end up getting some of those shares back.while I also look at opportunities in Sallie Mae, Mosaic, SPDR 500 and adding to poisitions in JP Morgan and Chesapeake Energy.

With that much to spend, I'll try to control my investing equivalent of premature ejaculation, but that's always been difficult.

I was going to say "but that hasn't always been hard," but then it would have been unclear whether I was referring to investing behavior or the metaphoric equivalent.

On a sad note, I'll be working tomorrow.

But that sadness is quickly replaced with the knowledge that I have only 2 more work days scheduled in 2011.

The work thing tomorrow does potentially interfere with the trading thing, but I've never let responsibility get in the way before, so I don't really think I'll be starting tomorrow. It may, however, help control the need to spend by keeping me otherwise occupied.

But still, that possibility is tempered by the fact that if I had to work, it couldn't be for a better cause. I'll be trading places with my friend tomorrow, who is on a golfing trip with his father.

I'd love to have the chance to have one of those trips with Szelhamos, but then I'm reminded that the most athletic thing I'd ever see him do was to bpwl one time.

As an 8 or 9 year old, I don't think I'd ever seen anyone roll the ball as fast and ghard as he did and barely ever hit a pin.

Still wouldn't trade that memory for all of the perfect 300 games on China.

Invest like TheAcsMan

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Somethings don't get Old

It's been a long week. I probably don't have to tell you that.

For me, the highs and lows of the past few days were more than just quantitative matters, they were matters of the heart.

As Lou Grant would have said, "I hate matters of the heart".

The week in question started on a real high note, as I watched my son graduate from Army Basic Training last Wednesday and escalated as we were able to bring him home with us to start his junior year of college. So, while stocks were just beginning to really shed some real market cap, I didn't mind too much. Joy can make you forget such mundane things like skyrocketing paper losses.

In fact, despite being armed to the teeth with my traveling trading desk, after a few hours in the car on the first part of the trip down to South Carolina, I decided to spare my lap the deep thermal burns, shut down the streaming CNBC feed and give it a rest.

Of course, at the time, the market was up reasonably nicely and I had a feeling of calm and peace. So much so, I didn't even care that much when I learned that the market eventually turned for the worse.

The next two days I was essentially cut off from any timely market related news. Although I did prove to my Sugar Momma that I wan't addicted to the electronic market tether, I did find myself breaking into lots of cold sweats and sucking the residual sugar off of discarded gum wrappers.

For some bizarre reason, when my oldest son, who now follows the markets tracking his undiversified portfolio of one stock informed me that the market was down 500 points last Thursday, I took it in stride, after all, I had my whole family in tow, reminiscent of long car rides together 15 or more years earlier.

Not only did I take the news in stride, but I actually got a kick out of that news, even though I'm not a short seller. Despite the fact that I exercise a covered call strategy on nearly every holding and despite the fact that the bids on most of those call options were close to zero, I still felt a rush.

For me, the exaggerated bounces in the market never get old. They're always exciting, even if I can't find a way to take advantage of them.

Imagine then how excited I must have been on Monday. Can you believe losing even more than on the previous Thursday? If Dow down 500 points is good for the perverse part of my being, how great is 600 points?

When I was younger, I used to measure money in terms of how many color TV's you could buy with that money. Our family got its first color TV back in 1964, just in time to watch the Yankees - Cardinals World Series. I remember spending most of my time trying to get the colors just right and trying to find the perfect antenna position. I usually ended up being the antenna and the grass usually ended up being blue.

After all, for $500 were you expecting perfection?

At Szelhamos' highest earnings year, I calculated that he could have bought 50 color TV's or one each week. Back then I was too unsophisticated to factor in taxes and things like present day value, or concepts like "constant dollars".

Now that I'm older I don't think in such childish and simplistic terms. Instead, I now calculate a days' gain or loss on the basis of how many Szelhamos years worth of earnings it constituted. For example, instead of saying that Monday resulted in a paper loss of 200 color TV's at 1964 prices, I would be much more inclined to say that the losses covered 4 years worth of peak earnings.

What a rush, albeit a downward spiralling rush to poverty.

While the market was going down, despite an occasional tease upward, the joy still overcame all.

Today, the story was quite different. This time, instead of having headed down south for a bit of happiness, I had to trek North back home to New York for a bit of sadness, as word had come of the death of a woman very dear to me. Not an actual relative, but very much a second mother to myself and sister.

A Holocaust survivor, a refugee from communism, she started a new life with her family and friends in America.Always giving, always smiling and door always open. As much as joy can help you to forget, sadness can help you remember.

But in her case all of the memories were wonderful, but unfortunately they had grown old and increasingly dim, until a touching eulogy reminded us that in everyday actions by her children, grandchildren and great grandchildren those memories live on. Sometimes that memory will take the form of a strudel.

And that's alright, too.

As the days' drive to New York began, I was in the passenger seat, once again with full electronic gear at the ready. Pleased to see the market hold its 200 point gain once again those feelings of calm and peace returned, this time though looking at how many TV's I could buy with those paper gains.

At about 3 PM, heading from the funeral home to the cemetery, my oldest son who was in New York on a business and had joined with us, turned to me and calmly let me know that the market had given up all of its gains.

Serenity. Serenity now. Remember. It never gets old. I keep telling myself I love the violent and unexpected moves.

Now, I also love Ben Bernanke as much as the next guy, but I couldn't imagine in my wildest dreams what he could have said to have shaken the markets so much. Normally I'd have been home rapt on every word and nuance, but today I was left to my wonderings. Did he call Tim Geither a "pussy"? I think I'd put up 1o color TV's at 1964 prices to have a front row seat for that cat fight.

And I like both of them.

Finally arriving at the cemetery the rain was pouring upon us. Briefly it stopped and someone remarked "What a miracle, God is smiling on us". Minutes later the rain came back with a vengeance and that same person took the opportunity to say "What a miracle, God is crying with us".

That reminded me of something that does get old. The various talking heads that believe the viewer has no sense of history or at least no functioning memory. I like my analysts and miracles to be consistent.

But at least here the intention was good. Sun was good. Rain was good. We were celebrating a good life.

As I looked around the assembled crowd, it was no longer the elderly crowd that I remembered from my younger days. With very few exceptions, they are now gone, being replaced by newer versions of themselves.

Oy.

Once back in the car, my personal market reporter, whose personal wealth may dwarf mine if the IPO market can survive the downdraft ,once again turned to me and said "Wow, the market turned it around and closed up over 420 points".

That's a lot of color TV's.

Hearing that kind of news never gets old. It may not be strudel, but hearing my son deliver that news is a sign that I will never get old, rain or shine .

Check out Recent PortfolioTransactions

A Call to National Action

What do Cisco and Standard and Poors have in common?

They are both headed by individuals named John Chambers. Given the recent news surrounding each of those entities, the reason you don't see their respective CEO's both appearing in the same picture is not because they are the same person, but because the world would implode if all of the evil intent directed toward them were to converge into such a tiny space.

Four months ago I wrote a blog essay entitled "S&P's Mea Culpa". On that day the occasion was S&P's threatening word's regarding the health of the United States' financial system. Those words resulted in quite a market sell-off, but with a significant bounceback by the closing bell.

Alright, in the name of fairness, let's just say the words were "cautionary", rather than "threatening". People, however, tend not to panic in the face of caution, whereas threats are more likely to evoke an adrenaline fueled response.

No one throws threats to the wind.

On that day, we actually had the last laugh.

At the time, S&P warned that a debt downgrade would be forthcoming in a couple of years if there was not a substantive alteration in our national ability to manage our debt and obligations. A "credible deficit plan" is what they called for and they seemed to suggest that our elected officials might not be up to the task.

In response the spin being put on the S&P pronouncement was that they were just gently urging the political process to move forward in a meaningful and constructive way.

Jay Carney, the then new Presidential Press Secretary replied to the spin by stating that the political process would "surprise S&P".

Like most of my blogs, that one was written after the facts were in and was a blend of (attempted) humor, cynicism and faulty analysis. Today's blog is different, in that it is written in worried anticipation of what tomorrow will bring, as our markets open. I don't see very much in a humorous vein at the moment.

So do me a favor, read or re-read "S&P's Mea Culpa". Besides a laugh or two, it was a prescient piece (That sound you hear is a self-inflicted tap on the back".

I won't even join the bandwagon and lambaste S&P for their $2 trillion error, or their role in the banking meltdown of 2008. At this moment, even Friday seems like ancient history. I also won't join the chorus and suggest that there was a political agenda behind the downgrade and its timing.

Well, slow forward a mere 4 months and the downgrade has become a reality. Time usually seems to go by quickly when you're having fun, but somehow we missed out on about 20 months of fun from that "couple of years" warning.

And what of that political process? Was S&P ultimately surprised by the way our elected officials responded to the call for financial management? Probably not, but even the most wizened of cynics was stunned by the process. Whoever keeps track of these sort of things can perhaps make a statement regarding the public's impression of their elected Congress compared to other periods of discord.

For my perspective, recent events highlight the fact that it only takes one to decide not to tango.

I suppose that you could file this thought in the "Irony Department", but I doubt that it's very funny to those sweating it before Monday's market opens. But to the Republican leaders, what will prove to be more costly to the demographic that  they sought to protect during the debt celing "compromise"? The additional taxes they might have been required to pay or the wealth destruction from the recent market plunge and anything that may lie ahead? No doubt, that on a per capita basis, the wealthy will be disproportionately effected by a stock market debacle.

I've lived through the tumult and in-fighting during the Vietnam War era, by by the same token, saw the bipartisan disgust during the Watergate years.

Fascinatingly, but then again perhaps not, if you read "How Did We Connect Before Kevin Bacon?",  August 8th the first day of trading subsequent to our S&P downgrade is also the anniversary of President Nixon's resignation speech. As an aside, the market closed down nearly 1% following that news.

Wouldn't a simple 1% drop on Monday seem liike an incredible gift?

I've seen the "Crisis of Confidence" coined by Carter that inspired no one, as well as the national unity during the Iran Hostage crisis. Had you purchased yellow ribbon futures then, you'd be having brunch with Carlos Slim right now.

I've seen us stand together when the threat of Y2K had even the most brave of us digging survival bunkers.

And of course, 9/11 was barely a decade ago and we even witnessed the most unlikely of all sights; our elected officials standing in unison on the Capitol steps, singing from a sense of shared national pride.

Borrowing from one of my 1970's favorites, ELO, "But I never seen nothing like you" could very easily been written in anticipation of the United States House of Representatives' response to the challenge S&P presented to them in April.

I don't want to bury the lead, so here it is: They failed the challenge.

Remember that annoying British import game show, "The Weakest Link"?

If you're ever looking for a political analogy to a terrorist, think "Tea Party".

I was pleased to see that @TeaPartyorg stopped following me on Twitter on Saturday. As that happened, I could see legions of Angels in the making receiving their wings.

Imagine Michelle Bachmann, who just a few days ago pulled a George W. Bush and urged default on, now is taking the opportunity to demand President Obama's immediate dismissal of Timothy Geithner as Treasury Secretary. Using her misplaced sense of logic, she should be lauding him, despite the fact that he has been a steady shepherd.

Truth be told, deep down I believe that if Geithner had sported an Angelo Mozilo like tan, maybe S&P would have given him a free pass.

Although it is certainly true that the downgrade, whether deserved or not, occured during President Obama's tenure, the last time I looked, we are still a nation of three equal governmental branches.

Just this one time, I'll give a free pass to the Judicial branch, as well.

I'm not an economist, but I don't think it is beyond reason to believe that decreased government spending will result in greater unemployment than increased taxes on the top 1% will diminish trickle down benefits to the economy.

The fact that there is no shred of evidence of compromise in the debt ceiling agreement, specifically as it relates to increased revenues is clearly the reason S&P took their action in a much accelerated time frame.

Every business knows that cutting expenses can take you only so far. At some point cutting expenses accelerates destruction. There's a difference between cutting "until it hurts" and "cutting to the bone". Ultimately, the only way out of the abyss is increased revenues.

Unfortunately, there are those that continue to cling to the unproven axiom that decreased taxes on the most wealthy is stimulative to the economy and they refuse to use a rationale thought process to consider alternatives to an all or none approach to the economy.

I do understand that approach to a hot button issue such as abortion. It's not terribly easy to compromise on that kind of issue, especially if there are religious overtones.

The last I looked, there were no such Biblical prohibitions on altering tax tables during times of economic need.

And man, for the United States, this is a time of need of Biblical proportion.

Since we are really in uncharted territory, no one has even the slightest idea of what Monday morning will bring.

Of course we'll all look to the Asian markets as they open Sunday evening but we alone are in charge of our destiny.

Just as the nation responded to the horrific human tragedy that was September 11, 2001, so too must we now resolve to correct the mismanagement of our political system.

In fact, I don't believe that there is anything inherently wrong with our economy that political compromise could not correct. It is time to send a clear message to all of those that have been entrusted to steer the national ship to forget about party alliances, blind faith and the need to campaign on a 24/7 basis. Ultimately, political dogma from either side, is the antithesis of our democratic foundations and principles.

There was once a very frightening expression "Deutschland uber alles" that belied an inflexible approach to existence, where the only alternative to complete victory was death. Germany above all was the siren call that led a generation to attempt to vanquish their perceived enemies.

Sound familiar? How else do terrorist organizations function? Only recognizing the extremes and going to any length to ensure that their misguided beliefs come to fruition.

Politics above all? Tea Party above all? Politics above nation?

It's time for a national call to action to take back the debt and restore core principles to our daily lives.

Geithner, Goldman and Google

What's in the Szelhamos Portfolio?

Not as catchy as Abraham, Martin and John, but much more alliterative.

Unfortunately, Dion had to throw in the name "Bobby" after the title was already a done deal.

So, throw General Motors in there too, but pronounce in the way they do south of the border or, if you.re a fan of the obscure, the Balkans..

I don't currently own GM, but I agreed with the $50 B bailout.

What I don.t agree with is the announcement that the federal government will be selling their remaining stake, at what will amount to a large loss, all in the name of political expediency.

Szelhamos used to believe that you should never talk about sex, politics, religion or money, when in proper company. So he did so on a regular basis, as do his offspring, since he also taught us to never keep proper company.

Although I voted for this administration, and only the third time that I correctly chose the winner in a presidential election since 1972, I'm having a harder and harder time supporting some of their economic and fiscal policies.

But, the other side isn't very good. In fact, I think they.re even worse on the economic side of things. Compassionate conservatives, my ass.

Nonetheless, to divest because they want to wash their hands of the auto business before the election, as has been the reason attributed to the announcement, once again puts politics ahead of rational thought.

Not to mention the public good.

Of course, if I were a shareholder, I would also be pretty upset that they are once again tipping their hand on a market moving and disruptive kind of transaction.

I suppose you could make the case that divestiture would raise money to put toward deficit reduction. Additionally, potential capital gains by those purchasing shares in a secondary offering would increase tax revenues, but still, treat it like an investment.

I think that if Timothy Geithner, who along with Ben Bernanke, have been very good at funneling money back to the federal government was left to his own resources, he wouldn’t be giving up the shares so quickly.

Although Geithner is never at ease on camera, he appeared even more so during this mornings' CNBC interview, as he tried to calm the international markets on the quality of US debt.

Unfortunately, politics gets in the way and the Treasury, too, will be held hostage by the children that we have elected to serve our interests.

While Geithner was speaking, Goldman Sachs was basking in its earnings report. The stock was up more than $4 during the pre-open. By noon, and one downgrade later, it was down more than $2.

Of course, that downgrade was from Dick Bove, who after bouncing around is at a firm that everyone seems to mispronounce. Rochdale, as in Rockdale.

Remember, Bove is the guy who appeared on a near daily basis on CNBC as he steadfastlt defended Chuck Prince's CitiGroup as it kept falling and falling.

"The dividend is absolutely safe".

Remember that?

What happened? They're still the smartest guys and now they've unloaded those expensive preferred shares held by Warren Buffett.

That can only be good for Goldman, but now comes the worry that with the retirement of those shares, so too are the principals of Goldman relieved of some of their obligations, such as not to sell their shares and not to retire.

Would it really be that bad if the likes of Blankfein faded away?

Certainly, Senator Levin (D-Michigan) would be able to find a new whipping boy, but some of the considerable heat would be off.

The Goldman bench is deep enough, even 2 levels down, that they could seemlessly continue operations, yet claim that those newly in charge had nothing to do with the questionable practices that fueled the financial crisis.

Win- win.

Since I own quite a few shares of Goldman, I would like to see a win-win outcome.

David Viniar, the CFO, was a past high school classmate of mine. I didn't really know him, but do remember his 70's hairstyle, which is very different from what he now sports.

Unfortunately, he didn't get good grades at today's conference call and was thought to be evasive.

People like answers.

Now that leaves me with Google, to complete the alliterative theme.

Actually, I have nothing new on Google. Still weak today, but finding a floor at $520. What frightened me from picking shares yesterday during the bargain hours, was that it looked as if Google still had downside potential to $500, when I looked at its chart. Based on its previous action following large earnings related drops, I don't expect that to happen.

But still.

I did have the chance to sell call options on Dow Chemical, Riverbed Technology, Textron, Freeport McMoran, Sallie Mae and Mosaic today and am still hoping to close a trade on Rio Tinto, while awaiting decent opportunities on all of the rest.

Freeport reports earnings tomorrow. I think they'll be good, but I’m concerned that guidance will drive stock down. In return for that fear, I got $1.91 on a $52 call, when the stock was at $51.20

Sallie Mae also reports tomorrow. The stock price started inching up in the last hour today. I took that opportunity to sell 79 call contracts. Why not 80?

3 PM, I think the day's outcome is already sealed and the trend is trickling upward. Now sit back and wait for IBM, Intel and some other company that I can’t recall, but don't own, to report earnings after the closing bell.

Oh yeah. Our benefactor, Yahoo!

At least that'll give me time to come up with lyrics to Geithner, Goldman and Google

Invest like TheAcsMan

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