Tuesday will be crazy

The Fed will be talking today, giving their decision on if they will lower the key interest rate at this time.  There’s a lot of talk and guessing going into this subject.  I know the answer because I have a glass ball (not a cancer-replacement, I mean something for looking into the future).  The answer is the Fed will …cut rates by 50 points.  There, I said it.  Well, maybe its 25 points.  I can’t really tell, my ball is a little hazy.  The discount rate might be 50 point cut.  Or not.

Here is my thoughts on today. 

WM is showing signs of weakness still, trying to make up for lost money with the mortgage market.  From reducing jobs to cutting dividends (from $.56 to $.15)to selling preferred-stock.  Here’s a scary thought, WM will discontinue all remaining lending through its subprime-mortgage channel; close 190 of 336 home-loan centers and sales offices; and eliminate 2,600 Home Loans positions, or about 22% of its Home Loans staff.  The stock is down from this news, maybe it’s time to buy … puts.  More news from WM includes the expectation to originate $1.5 trillion (that’s $1,500,000,000,000) in mortgages.  Which is down 40% from 2007 ($2.4 trillion).

T (AT&T) is raising it’s dividend 12.7% to $.40/share.  With a company like T, that is a big deal.  T alone could help raise the market, crazy stuff if you ask me.  I’m not going to look at getting anything AT&T, they drop my cell connections all the time.

FSLR could break through it’s 52-week high today.  The DJI is looking up (it’s about an hour and a half before the market open right now).  If the market is up, there’s a good chance that FSLR will break the high of $252.39, which is what I would like to see.  I’m still holding my that call.  It’s a Jan08 $240 call.  Since the call closed yesterday at $33.00, there’s a $20 premium in the call that I’m probably going to be taking advantage of today.

The Hang Seng went up 700+ points, which is a nice potential boost to stocks that have anything to do with China.  Watch BIDU run through $400 today, closing above the $400 number (that’s a psychological level).  I might be looking for some BIDU action.  FXI will also get some response from the China market move, watching for this ETF to pass $190.  Though I don’t have any options (currently) in my Retard Trader competition account, I am holding many calls in another account.  Watch for that to carry over, I’ll be looking at FXI and FXP (it’s counterpart).  There’s usually enough action there to get calls or puts some entertainment.

There are totally unsubstantiated rumors that AKAM is being looked at buy GOOG for a possible buyout.  Because the buying blocks on AKAM are not high, it would seems that only inidividual investors are acting on that news and not institutions.  Sounds like another rumor that might not ever come to fruition.

Speaking of rumors, if you ever wanted to get rich quick with stocks, and you don’t mind gambling huge, you can look into penny stocks.  I have never known anyone to get rich with penny stocks, but there’s quite a bit of hope in it.  In fact, it’s pretty amazing how many people will chase this.  I have bought penny stocks over my trading life, but not to get rich, just to make some extreme profits.  I like several penny stocks and continue to buy and sell them in a different account.  It’s currently down about 20%, but the idea is that it will only take one good one to get rich qui… oops.  I guess I do that get rich thing too.  Damn!

Seriously speaking (or writing), I buy some penny stocks that have made movements so that I can buy something for $500 and sell it for $1,000 just based on owning 5,000,000 shares.  ADOT is one that has shown movements, but recently hasn’t done much.  Alright, that’s more than enough about penny stocks, I’m not likely to buy any of those for this competition.

Lindsey is catching amazing moves and though I’m happy for her, I’m also disappointed in myself.  I study stocks and the market, interpret news and happenings, and have not been able to keep up with Lindsey.  Yesterday when she said that she thought CELG was overbought which is one of the reasons it was dropping, that wasn’t why the stock dropped over 15%.  CELG competitor had positive results for a blood-cancer treatment.  With that news coming out 16,000 options were bought at the $50 level, giving option holders the right to sell CELG at $50 by Dec07 expiration (less than 2 weeks from now).  This morning the stock bumped back up a little over the $50 level.  The Jan08 $42.50 and $45.00 puts were also pretty high.  Watch for more falling in this stock.

That’s enough blabbing on for me.  Thanks for reading!