Thursday, August 25, 2011

Grandpa Buffet Has Gone Senile, The Gold Bubble has popped, and Steve Jobs new Job

You thought the news surrounding the financial markets over the past few weeks were a cause for concern. Well, its getting worse.

Imagine if 1 week ago a soothsayer told you that Buffet was gonna buy BAC. Gold prices would tumble, and Steve Jobs was gonna leave his role at Apple.

You would have laughed in this guy or gals face, and lost out on huge price changes would would have secured huge returns. Don't worry there are still moves that can be made to make money post-news.

First, why is Buffet investing in BAC? BAC is still on shaky footing and Buffet is looking for near-term improvements that will allow him to flip his discounted shares at a considerable profit in year or two. Don't follow Buffet, the oracle got a special deal, and now BAC is even more overpriced. What is the financial play here? I doubt BAC is gonna head southward. So buy some shares, buy some in the money long-dated calls, and sell a ton of long-date $10 calls.

Wow - what is happening to Gold? Simple, people have lost interest in worthless metal.Get out why you still can and sell that damn shit to cash for gold. If you have a futures trading account, I would sell from short-term futures.

Apple's price really hasn't changed. But having this overhanging uncertainty finally clear up is all the more indication to get on board the Apple boat.  Buy some shares, I'd expect them to end the year just above $400 a share.

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