Cockiest Scrub I Ever Saw

I just found this funny poop now.

Here's Brian Scalabrine, the deadly 15th man of the 2008 NBA Champion Boston Celtics:



One would think that this Moron was the team captain or something - but he was more like the team mascot.



Just imagine his ego if he had, I don't know....maybe got a dunk in during garbage time or something.

The only reason I found these clips is that I was searching for a video of him getting hurt this season. He got hit on the head or something and fell to the ground like Humpty Dumpty. I was in stitches and cheering because I knew there was a possibility that with him injured the Celts could UPGRADE the roster from the Development League.

Mish Must Need Cash

Mike Shedlock is pumping some option trading product on his blog called OptionMonster.

He thinks he's disclosed enough when he says:

Those trading options or interested in trading options may wish to check out OptionMonster, a service that I feel has a lot of potential for option traders. Yes, I stand to profit if you sign up and stay signed up, but I would not mention this service if I did not think it was worth a look.

And then later:

I cannot personally vouch for OptionMONSTER because I have not tried it. However, I can vouch for the founder's reputation. I have high respect for "Dr. J".

Okay, I'll finish the disclosure.

This product is crap. The two examples Mish gives from the *service* highlight nothing. One of them involves scalping a vertical put spread in US Steel.

To me it's a dead giveaway that someone is an option Moron when I hear them talk about 5-point or 2.5 point spreads. And don't mention *iron butterflies* either - that's another screaming badge of ignorance.

[Hint - y'all can't make any real money with those sissy trades!]

Mish writes:

Someone Always Knows

OptionMonster publishes research based on the idea that unusual trading activity (puts, calls, etc.) predicts future price movements.

This also is utter CRAP.

The idea that one can build a profitable trading strategy around coattailing savvy option trades may be marketable to retail fools, but it's just another brand of snake oil.

In a nutshell, the trades are way too hard to identify and probably not sufficient in number.

All that energy trying to figure out what *the smart guys* are doing would be better spent reading the tape and doing more eclectic research - like reading blogs!

For sure there are plenty of savvy traders out there whose knowledge can be profitably tapped.

But the best resources are out there are definitely not pumping or selling retail products (or writing books).

Just think, if Dr. Najarian of OptionMonster had a winning option trading strategy, would he be peddling it over the web?

Or would he be implementing it quietly with proprietary capital?

All he has is a *marketable* strategy - just like Fidelity!

What's humorous AND deeply ironic is that *Dr. Najarian* made all his money over 25 years in the CBOE options pits....as a marketmaker taking the other side of retail trades.

Ken Lewis - A Marked Man

Ken Lewis, incompetence incarnate, was in Boston last week.

Someone I know who heard his speech told me that he looked *absolutely terrible*; he was thin, ragged, and frayed around all the edges; but this is only fair...

....as he's made millions of brokerage statements also look absolutely terrible!

I've been informed that he now has five full-time bodyguards.

And that the entire city of Charlotte wants to kill him - figuratively speaking of course.

Then again, he does have all that *security*.

One has to realize how many BAC stockholders there are down there who just gotten hammered as the stock's come down 90% from its peak.

The other day I randomly met someone who works for Ken Lewis' bank. Without being too specific, let's just say he's doing a lot of merger integration work with Merrill Lynch. He's traveling almost everyday to NYC (from Boston), often for a week or two straight. Let's just say that he's beyond depressed.

First of all, his BAC stock holdings have been effectively wiped out. Secondly, he's working his tail off with no shot of a bonus or a raise EVER on the horizon. Mere job security is his best outcome.

Lastly, and *worstly*, he says his Merrill peers, into whose department he's been consolidated, he said that they all earn *3 times* what he earns - and that they got paid 90% of their target bonuses last year.

I got the stark impression that this guy was going to quit pretty soon. So add to the vast collateral damage of Ken Lewis' idiocy the loss of one *cheap*, *hardworking* employee. [And then multiply it by a suitably large number.]

If only Ken had the best *mindguards* money could buy....

To see everything I've exposed Ken Lewis on - click here.

Trades - Drunken Irish Day 2009

Bad day today. Most of yesterday's paper gains were erased as the market continued to squeeze the shorts.

The morning started off inauspiciously as I got a phone call to cover my XHB short. If you remember, I tried unsuccessfully to borrow that ticker back in February; as an end-around, I bought deep puts a tad over parity which automatically exercised. So I stayed short for one full month under the radar. What sucks is that I had to cover this POS at 9.97 after just missing it this morning at 9.47 (never mind at 8.00 last Monday). Looking back to when I put this trade on, it seems I still made .89 of profit - not bad, but should have been better. I have to admit that I completely forgot about the possibility of them calling this position away.

Near the end of the day, I stubbornly added to QID - the double-short NASDAQ ETF - at 54.24.

And I bought a little SKF at 127.16.

I tried to buy a bushel of March 9 GE puts at .13 on the close but for some reason I didn't get a fill even though it looks like they were offered at .12. I'll try again in the AM.

Lastly, that SKF that I bought in my retirement account yesterday at 128.18....I let out at 149.12. Then I re-established it at 131.50 and also bought a smidgen of SRS in that account at 62.54.

Trade small enough and I bat 1.000!

Unfortunately, I think we have some more squeezing ahead of us - and at least four weeks before reality descends upon the equity markets again.

I'm going to sit back some and try not to watch, and add to losing positions.

The Mailman Cometh

Here's what I wrote about my landlord last month:

Now I swear, since our mailman comes like clockwork at 4pm daily, that my landlord has been swinging by to intercept his mail so I wouldn't see *foreclosure notices* and whatnot. (We share a mailbox.) For a Moron who's otherwise all over the place, he sure has promptly been there to retrieve his mail.

Well, it's no longer a hunch. It's recently been proven that this clown landlord of mine simply does not want me to see his mail.

Yesterday, as I got home around 4pm, he was on my property and upon seeing my Earth-scorching SUV he sprinted past right past my moving vehicle to get to the mailbox.

This past Friday, not only he he descend on the mailbox the second it was delivered, his teenage son came by not 15 minutes later to check it. They have a full-family assault going on, apparently.

On Sunday, the mailwoman rang my bell. She had a registered letter for my thievin' landlord that I needed to sign for. I said I'd just put it right back in the mailbox because he'd be by *momentarily*.

She said I know well what you mean, "He's been following me around town, everyday, to each of his three addresses. Many times he's gotten so close that he's *boxed* my truck in."

Now, this Moron's four underwater homes and *8 mortgages* have been known to me since day one.

But as for credit cards, I only suspected that he was robbing those companies as well. At a recent social gathering, I was talking about this crook and casually mentioned, "He's probably got 10 credit cards or something."

Someone there whom I just met added, "He's got well over 10 cards, and they are all loaded up....I know because I work in a bank in which he applied for an *unsecured loan*."

Then the other day I just got another confirmation of this credit fraud. A former colleague of his told me that my landlord had *several hundred thousand* in credit card debt.

Just imagine all the mail, all the phone calls he gets from creditors.



What a system we have where Morons can steal so much money and not end up in jail!

If you haven't already, see my post from yesterday - Give The Morons Some Credit.

Next up, I'll tell y'all how this joker is trying to wrest a rent increase from us. This one's pretty funny.

Give The Morons Some Credit

Many antsy stock market bears have their hopes on *the next shoe to drop*.

So what could it be?

For a couple years now I've mistakenly thought it would be a pop of the US Treasury bubble. [I still have TBT and time will tell.]

Luckily, other poop has manifested, and manifested, and manifested.

Next up might be a municipal meltdown - how about the State of California?

It could be the final nail in General Motors - though this might already be priced in. The political will to write Detroit checks just HAS TO BE waning, right?

And it could always be another high-profile bank implosion.



Meredith Whitney, that noted blond bear recently asserted that *credit cards* are indeed the next dropping shoe for the equity market.

Between un-recoverable defaults and credit retraction, those plastic cards which have been conflated with hard currency will be cut in half, both literally and numerically.

Credit cards may seem small compared to the aggregate mortgage market, BUT....

With nothing to foreclose on, bank losses on them are 100%, at least.

And, the retraction of credit is destroying all the junk-sellers (Circuit City, Big Auto, Linens N'Things, malls, etc.) and fueling a spiral of pain. Retailers are going bust and slashing jobs....which in turn hurts these lazy 'new coot' Morons who are trying to pay down their credit card bills. This whacks commercial real estate; which in turn whacks investors and pension funds, private equity shysters, insurance companies....and investment banks, and commercial banks. And so on and so on. If only credit card losses were *contained* to a narrow industry! [like subprime, couch, cough]

Look at two of the pure-play credit card biggies, American Express and Capital One:





I sure wish I kept that COF short from the 50s last year!

Note that while AXP and COF allegedly represent opposite ends of the creditworthiness scale, that the two charts are near mirror images.

Now just Friday, Capital One announced rising card delinquencies for the month of February:

NEW YORK, March 16 (Reuters) - Capital One Financial Corp , one of the largest issuers of MasterCard and Visa credit cards, said on Monday that credit card defaults rose in February in the United States as job losses accelerated and unemployment soared to a 25-year peak.

In a regulatory filing, the company said the annualized net charge-off rate -- a measure of credit default -- for U.S. credit cards rose to 8.06 percent in February from 7.82 percent in January, while the rate for loans at least 30 days delinquent increased to 5.10 percent from 5.02 percent.

8-freakin' percent?!?!?!

How exactly are they going to absorb those massive losses?

I suspect that credit cards are like mortgages in that a few bad apples are responsible for the bulk of losses. In other words, it's not like the card companies are *writing off* 8% of everyone's balances. It's more like one of every 12 people is revving up their balance to the max and simply walking away.

I remember years ago when I first learned about *credit card debt*. I had a friend in Philly who was dating an older broad from Kensington. Of course she would never tell anyone that specifically....no, she was from *The Northeast*. One day my buddy informed me that she owed 60k on her credit cards and I instantly fell awestruck and dumbfounded. Her house wasn't even worth that much. Why the bleep did the card companies ever extend her that much credit to begin with?

Of course back then, I was innocent of the concept of *securitization* and also of *greater fool* financial schemata.



To wrap this post up I want to make a tangent to HELOCs - so-called home equity loans.

Back in 2006, Ken Lewis at the Bank of Morons, decided to write about $110 billion in HELOCs. This vintage is proving, and will continue to prove utterly disastrous for two simple reasons:

1) These loans are essentially unsecured by any actual *home equity* AND also by their secondary lien status.

2) These loans are trading at 5 cents on the dollar because of the demographic who purchased them.

You see, a great proportion of 2006 HELOC borrowers took the money out to PAY THEIR 2005-vintage mortgages!

This was the case for my landlord who added at least four secondaries (perhaps more) to his four properties as the bubble was bursting. In the past 1.66 years that I've been here, he has in fact been using that secondary lien money to pay down primary debt. [And drive $80,000 cars, etc.]

Other people I know in my circle of family, friends, and enemies (biggest sub-population) have done likewise. Invariably, those in fiscal straits also have *two mortgages*.

The first step is to bite off more house than one can chew.

Next, blunt that mortgage with a HELOC.

Then, or concurrently, let those credit card balances skyrocket.

Followed by, a loan against your retirement account. [25% of the public has done this!]

Then, at the end of the rope, only the lucky can tap mom and dad for a lifeline.

But getting back to credit cards - while my argument may be overly anecdotal, don't ignore the trenchant logic of it all. The people who have run up their credit cards are already surrounded by debt and all but exhausted of means. Meredith Whitney is correct, the losses will be staggering for the banks.

By the way, that last graphic above of Countrywide advertising *bilingual*, *quick and easy*, *low rate* HELOCs is not from the bubble years; it's not even from last year.

That's on their site right now!

Trades - March 16th, 2009

Today I doubled-up my GE short at 10.12.

And I doubled-up my FXP position at 30.20.

As for those wacky, rallying banks....

I bought a smidgen of FAZ and a smattering of SKF in my retirement account. FAZ at 37.82 and SKF at 128.18.

Kfell, sometimes you have to stop *averaging down* just to make a little dough back.

Shorting today would have been very remunerative to say the least - but I had to refrain as part of my penance for last week.

The Swing-Set Botch

I've got two adjacent neighbors who've recently put up swing-sets for their brats - though they hardly ever use them.

I remember a guy from my trading pit, whining about having to spend $4,000 on a swing set for his little girl. "Can't you get one for a grand or so?", I asked.

"Yeah, one that'd be conspicuously inferior to everyone else's in the development," he moaned.

It may be easy to be a sheep, but it sure ain't cheap!

Then just this weekend I talked to two other guys who were depressed about buying and installing swing-sets that their kids barely touched.

I'd never buy a swing-set; that's what parks are for.

New parents need a manual on pitfalls to avoid. They strangely feel like their kids will be deprived without all the trappings of a middle (upper) class, suburban lifestyle.

I haven't stack-ranked them yet, but swing-sets may be pretty high up there on the list of dust-gathering products almost all Morons buy - pretty close to that treadmill-turned-clothes-hanger.

These things can be a b*tch to assemble too. I watched my one neighbor (and his 'old coot' father) spend about 10 hours putting up their still-unused swing-set.

The swing-set pictured above is *on sale* for $8,600. I know which side of that transaction I want to be on, how about you?

Solace For This Week's Bears

Last week was an unusual case where both the VIX and the S&P 500 both were net gainers by Friday.

A poster on xTrends linked to the above research which analyzed the market's performance following such *divergent* weeks in recent history.

[*Divergent* because the market and the implied option volatility usually move inversely.]

Click the graphic for a sharper image. And note that 4 days after such an occurence, the S&P 500 was down 17 out of 18 instances - and often quite substantially.

Friday's Market Action

I'm still short - having done nothing on Friday.

This is expiration week; it's actually *triple witching* because options, futures on options, and a bunch of other stuff rolls over.

Talking heads who've nothing better to do, forever bleat that *expiration week is volatile*.

Is it now?

I don't care what any *researchers* assert.

In 13+ years of trading (half of that in equity option pits) I never noticed one iota of increased volatility during expiration week.

And note that there's almost no way this upcoming week could be more volatile than the previous two.

I have no directional prediction for the market - only hopes ↓↓↓↓.

See my previous trading update here.

Worcester Beetle - Another Ill-Conceived Bailout

I just found out there is a Chinese beetle ravaging my hometown of Worcester, Massachusetts.

Government agents have deemed it such a threat (to Maine and Vermont forests) that they have set out to eradicate the alien invader. They have taken the license to cut down all infected trees (17,000 so far in 2009) whether they are on public land on private property.

In short, the eco-Feds have decimated whole neighborhoods. Streets that were once tree-lined with 50-year old maples and oaks now look like tornado victims. Homeowners have no say - no appeal in the matter. Many have been reduced to tears.

[I remember about 30 years ago when they paved our streets. Government agents felled two magnificent trees on the corners of our property. My mother was absolutely hysterical.]





This story reeks of BS. This so-called Asian longhorned beetle has been in this country since 1966. If eco-Feds couldn't stop it in the past 43 years, how do they get off claiming the ability now to *eradicate* the bug?

There are no natural predators to control the beetles?

Whatever. Trees need to learn how to adapt.

It's utterly amazing how often these hypocrites want to suspend evolutionary processes. What ever happened to *survival of the fittest*?

There's a little article you can read here.

Marginalizing Ossified Hippies

In front the nearby Hingham (MA) post office, there's occasionally a bunch of queer 'old coots', dressed in rags, waving peace signs. It's an odd sight to say the least. Where is the war anyway?

Clearly, they are unrepentant, 1960s hippies who never *got a life*, right?

Apparently, all the tony little towns around Boston have these time- and brain-warped protest groups.

And the Boston Globe has an article today that confirms my prejudice:

"The invasion of Iraq was a horrible thing, so I started coming because I thought I’d go out of my mind if I didn’t do something," said David Ascher, 61, who protested at anti-Vietnam sit-ins as a student at City College in New York...

Linda Stern, 67, of Newton, was active in demonstrations during the Cuban missile crisis in 1962 as a student at Carleton College in Minnesota, and marched to protest the Vietnam War in Washington D.C...

There are plenty of legitimate reasons for being *against* the goings-on in Iraq and Afghanistan....

But you'll never hear any of them from these 'old coots' and 'old bags'.

Imagine if YOUR brain had permanently ceased to evolve while you were a college student.

Almost as bad for them is the tragedy of being walking-stereotypes.

How depressed would you be if a passing motorist could read your life's tale in an instant?

Lil' Levity

Check out these Moronic headlines:

Twisting The Knife In My Shorts - Trades March 12th, 2009

Endured a whole lot more pain with my foundering shorts today.

No flipping stock either. I grabbed some FAZ at 50.24 early in the day, but never got a chance to sell it.

When I got home this evening, I bought another round at 41.27.

I also shorted GE today at 9.45 and 9.62.

I'm about as short as I want to be. I'm going to try my best to avert my eyes for a few days.

Competitive Quackery

Just as the Boston Globe is going bankrupt, its content has become so much more interesting:

Dr. Poul M. LaPlante, a family practitioner near the Medford clinic, said three of his patients have gone to MinuteClinic recently for sinusitis, though his office had appointments available. They were given antibiotics, which he did not think was warranted; sinus infections are usually treated with steroid nasal sprays, he said.

"I was a little distressed by that," LaPlante said. "They don't have any ongoing relationship with the nurse practitioner. When they see me, I can usually call on their trust in me when I say they don't need antibiotics."

LaPlante said he has not asked the patients why they went to MinuteClinic. "It's a touchy subject with me. I feel sort of jilted and I don't want to convey this to the patients," he said. "But if someone is going on a repeated basis I need to ask them what is going on."

Dr. Andrew Escoll, a family practitioner in Tewksbury, said 10 of his patients have used the nearby MinuteClinic. He said that the clinic quickly sent him treatment notes, but that he also has seen overuse of antibiotics, a concern because it can lead to treatment-resistant bacteria.

Overall, he said, "they are actually doing a good job for what they're doing," Escoll said, but he remains philosophically opposed to the idea, in part because of the missed opportunity to discuss health screenings with patients. "People are always running to their doctor with colds. When they do, I can usually address a whole list of other things, like when they need a pap smear or colonoscopy," he said.

Did y'all catch that last insinuation?

A representative of Big Medicine's doctor cartel throws a subtle doozie out there - these walk-in clinics will increase cancer!

So, am I *for* walk-in Big Pharma medical clinics?

Yeah. I say clear the hypochondriacs out of my doctors' offices if it may reduce my costs and my wait-times. Though I won't hold my breath.

The Globe's articles now all have relatively open comment sections which are proving quite feisty. So far they haven't *censored* me, though I am yet to really *test* them.

This Chick...

Would break West Coast Tom in half!

And he'd be so lucky.

The Last Person...

The last person I'd want to be today is a mall operator - strip or otherwise.

Commercial tenants of almost all stripes are getting killed. And just about every one of them is going to ask-for/demand a rent decrease. For example:

Movie-rental chain Blockbuster Inc. sent letters to its landlords around the country in January saying that company real-estate representatives would be in touch. "It is imperative that you respond to their call expeditiously and favorably," the letter reads. The topic: Blockbuster, struggling under a mountain of debt, wants rent reductions of as much as 30% and early lease terminations at thousands of its outlets.

Some landlords don't seem to be biting. Weingarten Realty Investors Inc., based in Houston, has 50 Blockbusters spread among its 323 U.S. shopping centers. "There's no way we're going to do that on any significant basis," ...

No way, huh?

We shall see.

Mall owners are screwed no matter what they do. Don't give rent reductions....and they'll accelerate the demise of lessees.

Grant them, and they'll just open the door for other tenants to plead for similar reductions.

The mall operators essentially have ZERO LEVERAGE in this game. Who'd fill an empty storefront today? Maybe a pawnshop but that's about it.

Furthermore, as stores go empty, it lowers *foot traffic* - which hurts the rest of the tenants.

Recently I talked to a *fast-casual restaurant owner* in a local mall. He told me he was now hemorrhaging money, "every month". I told him to take his financials to the mall operator and ask for a rent reduction. Amazingly, the thought never even crossed his mind.

Empty strip malls are everywhere these days - even up north.

Just how many walk-in businesses do we really need anyway?





Mall operator - an unenviable job, but with *choice* parking.

Morons Are Recession-Proof

For three years now I've been anxiously awaiting a housing market correction here in the Boston area.

But all I've been met with is perennial disappointment.

A local *realtor* recently fired out this article to me titled - Top Ten Recession-Proof Towns - as if THAT was going to get me to part with my cash.

It's pretty amazing to see that some locales have allegedly experienced housing price gains *since the market peak*.

[Note that the real estate propaganda today mostly reports *median* sales which have been skewed higher by the decrease in low-end transactions.]

Regardless, being *recession-proof* may make great marketing for pushy agents and magazines dependent on advertising, but it may not be quite enough.

The question is, are these town/houses *Depression-proof*?

Time will tell.

Revisit my personal frustration here:

Morons Bidding Against Themselves

The Morons Are Still Winning.

Picked Off By Blockbuster

Last Tuesday, just after lunchtime, I stopped by Blockbuster with my kids. We rented the all-time classic 80s kids' flick - The Goonies.

The clerk there talked me into joining and anteing-up for the *Blockbuster Rewards* program.

So what do ya know?

I get home later that afternoon and see headline rumors about Blockbuster filing for bankruptcy.



Look at the intraday chart above. Seemingly, once they got my $10, they decided to *file*!

Alright, they haven't officially filed yet, but it won't be long.

25% of the float is shorted even though this turd trades well under a dollar per share.

Adding insult to injury,.....The Goonies was all scratched up. We had to skip the best part where the kid gets to make-out with his older brother's girlfriend.



Captain Lou Albano, "Rowdy" Roddy Piper, Bobby "The Brain" Heenan, the Iron Sheik,....and Cyndi Lauper!

Trades - March 10th, 2008

There was no chance the market would give me back any $$$$ after my hammering - thanks to Taylor getting short with me. I must say, it felt like West Coast Tom was short as well.

All I did today, besides ride out my losers some more, was scalp FAZ once. I bought at 54.29 and sold at 60.00.

Avuncular Marginalization

A few months ago, I got word that my uncle had bought some General Motors. I think the stock was a lofty $6 or $7 per share. (It hit 1.27 last week.)

Why did he buy it? Who knows?

I do know that he consulted my sister (his niece) that works for GM.

What next? Ask Ken Lewis if his company is a good buy?

He DID NOT consult me as I would never have endorsed that move. (Last May I shorted this turd at 17.73 and made 3 points. Should have held it!)

Let me tell y'all something about CaptiousNut - that I'm sure I've mentioned before.

When I meet a plumber, I take that opportunity to ask him about pipe issues I may be having.

When I'm socializing with a car person (mechanic, truck driver, etc) I lay the problems of my clunkers on them.

When I'm around real estate people, I ask them about real estate. (Then I usually enlighten THEM.)

When I meet someone in a business I've know little about, I fire all sorts of questions at them; I pick their brains to edify myself.

When I hang out with teachers, I ask them how to educate kids.

.
.
.
.

Alright, I admit the last one was a JOKE.

But you catch my drift.

If you had a nephew who traded stocks professionally for 13 years, wouldn't you, ever, ask for a consult?

My uncle has never once asked me anything about the markets. Of course he has a *financial adviser* who's convinced him to dump money in mutual funds EVERY MONTH.

Now, my uncle is bright man - he'll even tell you himself. I'll bet y'all never knew that 40 years ago, his alma mater Holy Cross was as good a school as Harvard. (Then they went coed....)

Furthermore, he's a doctor, a neurologist.

The more I thought about his little knife-catch of GM, the more it irked me.

What kills me, is that whenever I have a medical issue, personally or in my family, he's the first one I call. I can't tell you how many times over the years I've called him late at night to ask about some ailment.

[By the way, if I meet you socially and will only broach mundane subjects like sports and the weather....that means I've deemed you a fount of *nothing*.]

Hammered Today

I had the right idea to lighten up and step back....

...but botched the execution.

Ideally, I would have done nothing today and re-established my shorts, confidently, after the close.

Instead, I got anxious, and shorted way too soon. Now I'll be trading like a wuss tomorrow; I'll be hoping to just get back half of what I lost today.

Today I bought QID at 68.04, 67.33, and 64.53.

I bought SRS at 88.54, 82.50, and 69.90.

I bought FAZ at 81.30, 75.16, 69.58, and 60.80.

And I shorted GS at 79.46 and 83.68.

So I was looking for daytrades but got stuck with positions! Big ones at that.

Hopefully the market sells off a little tomorrow so I can undo the damage.

Note, the FAZ can't possibly retrace. Even if all the underlying financials gave back today's gains tomorrow,....it would only climb to about 78.00 or 79.00.

Don't believe me? Then plug 12.3% into that formula I computed in - Leveraged ETF Risk.

Ban Jim Cramer - Keep The ETFs

Since I'm a part-time trader, and don't really do copious research, I learn about stuff somewhat slower.

Not long ago, someone posted a comment on my blog about Cramer and him jawboning to *ban short ETFs*. Of course I saw it but didn't pay much attention.

I simply do not watch CNBC; and I definitely do not watch Mad Money.

But I was on the treadmill last Friday and saw a bit of Cramer - thankfully on mute. He was inveighing against those Ultrashort ETFs that I trade so much these days. Essentially, though he won't admit it, he scapegoats the ETFs for his losses in JP Morgan and Wells Fargo.

I'll let the ETF guys defend themselves:

"We reject the notion that short ETFs harm the markets," comments Dan O'Neill, President and Chief Investment Officer, Direxion. "Healthy markets are designed to discover the proper price levels for whatever is being traded. Most people recognize that permitting short selling simply adds robustness to price discovery. Those in favor of banning shorts are trying to manage the market higher by silencing one side of the argument. This is generally self-defeating and harmful in anything but the very short term." O'Neill also observes, "The recent housing bubble - which was caused at least in part because it is not possible to short housing - shows the danger of one-way markets."

What do the Assets Say?

Before you believe the propaganda of agenda pushers who argue that short ETFs are harmful to the stock market, look at the facts. Fund providers like ProShares, DirexionShares, and Rydex Investments each offer ETFs that play both bull and bear markets, not just bear.

Critics who complain that the UltraShort Financial ProShares (NYSEArca: SKF - News) is exerting downward pressure on financial stocks fail to mention the Ultra Financials Fund (NYSEArca: UYG - News), a long leveraged financial ETF, has an asset base more than double SKF! Currently, this pair of ProShares financial ETFs is overwhelming net long financial stocks.

O'Neill observes a similar trend at his Boston-based firm, whose ETFs were launched late last year. "Each of the Direxion Shares long and short ETF pairs is, and has been, for the majority of their brief existence, net long." He adds, "Although we believe it would be perfectly fine and consistent with healthy markets if the pairs were net short, the fact is that they are net long, meaning they're adding to market demand."

In the following clip, skip forward to the 1 min 10 sec mark for a litany of Jim Cramer's big calls bombs:



Did y'all know that Jim pounded the table on the now essentially zeroed-out Countrywide Financial?





I can't find the initial buy note (article expunged?) but Jim definitely said to buy Countrywide - AT THE TOP - at $44 per share or so.

Did that company go belly-up because of ETFs?

I think not.

Rightfully, the SEC, if it's going to make any fascist moves, ought to ban Jim Cramer from television.

He's proven a far bigger risk to *investors* than levered ETFs.

Will CNBC pull Cramer off the air because his *calls* have been so bad?

No way.

His ratings are way up. He's probably in line for a raise.