There's going to be a lot of very heavy betting over the next few days, weeks, and months on what's going up, what's going down, and what's going around:
- How far will Facebook IPO price go?
- How far DOWN from here will JPMorgan go, with the FBI and DOJ now sniffing around?
- How far AROUND the globe will the fallout be if Greece loses its game of chicken?
If you don't have the stomach for what's going to feel like an out-of-control rollercoaster ride, sideline yourself.
If, on the other hand, you like a lot of action, welcome to Mayhem – the preamble month to what will likely be the Summer of Some Discontent.
That is, unless you like rapid-fire trading.
Which, by the way, is not just fun, but can be very, very profitable. I'm in, and so are the subscribers to my Capital Wave Forecast. We're gearing up for some heavy betting in the weeks and months ahead.
So, what's front and center today? You know. The big three headlines: Facebook, JPMorgan Chase, and Greece. Are you sick of hearing about them? I'm not. I like trading the headlines.
Here's my "heads-up" on the big three headlines.
1) Facebook is going to be a Wild Ride, For Sure
I didn't even try to get into the Facebook IPO.
Too many people at too many brokerages and banks that own brokerages don't like me because I'm constantly calling them out on their you-know-what, so I had no chance.
But if I was to get IPO shares, or – better by a mile – if I was smart or lucky enough to own some VC (venture capital) or insider shares between $1.00 and $5.00 (which is where the insiders own shares at), you can bet your bottom dollar that I'd be flipping those shares. Maybe not all of them, but I'd sell at least half, depending on how the stock trades.
I like Facebook as a company, and I like it as a stock to own.
Personally, I don't bother much logging onto Facebook myself, and I don't post stuff there (I'm too busy doing things to make time to write and tell my "friends" what I'm doing, because I'm usually doing it with them).
That doesn't mean that I don't get it.
I know a LOT of people who are on FB all the time. Good for them, and that's, of course, good for the company.
For sure, I will buy FB shares in the future, and I may load up on it if they do what I hope they do with their about-to-be monumental war chest of equity currency. I'm just not buying the "IPOhhh" hype.
You can read more about my thoughts on the good, bad, and ugly of Facebook's debut at Money Morning.
I'll leave you with this about that: FB's coming out could be the top of the market.
On to JPMorgan Chase…
2) The FBI's Involvement Means One Thing
What in the world is the FBI doing, opening up an investigation into JPMorgan's big trading loss?
And what is Attorney General Eric Holder (wish he couldn't "hold" onto his job), unfortunately the top dog (and I mean DOG, sorry all you real dogs, I'm a dog lover, just not that species) at the Department of Justice (oh, don't get me started, I'll end up Fast and Furious), doing, opening up an investigation into the loss?
Forget about the DOJ. They've lost a lot of credibility in my book, because they're far too politicized an agency. And that's more dangerous than disgusting to me.
But the FBI?
The FBI isn't interested in regulation. It's about criminal activity.
Folks, if the FBI is involved, there must be more than just suspicion – something must smell of criminality. (Hopefully they're not just going around attacking people and institutions based on just "suspicion," but hey, the way this country has drifted from our Constitution and our inalienable rights, anything is possible… can you say The Patriot Act? TSA?)
I'm holding off buying JPM until I see where this is going. Too bad, because it's been getting close to a buy. I had told you on Sunday that I'm a buyer here and down 10% to 20% lower. Now, I'll wait a little to see if I can start buying lower than where it is now.
In the end, JPM is too big to fail and will kick ass in the future.
And last but not least, my favorite…
3) The Greek Tragedy
There's a very, very dangerous game of chicken being played out between some ascending political factions in Greece and the rest of the Eurozone, and in particular, Germany.
Left wingers in Greece are saying the EU won't kick them out of the currency arrangement they're a part of, and they won't kick them out of the Union.
Let me say this about that.
They are dead wrong on the first count and dead right on the second count.
The Germans have their Achtung Baby boots all over Greek necks. They want to force harsh austerity measures (make that even harsher than they already have imposed) on Greece if they are going to give them any more of German taxpayer's hard-earned euros.
But German taxpayers may revolt against the German government giving up its wealth to save a profligate neighbor who flaunts its laissez faire – some call it unfair and just lazy -ways in the face of all of Europe's helping hands.
If the chicken can't cross the road, the world will be eating raw chicken soup with all its attendant salmonella implications. And we're all going to lose some weight, the ugly way.
It's just all such Mayhem right now. I don't see any sanity or saving grace coming our way any time soon.
But, boy, do I hope I'm wrong.
If I'm not, I'll be making a lot more short bets than I have on now.
Related Articles and News:
- Money Morning:
The Facebook IPO Facts: The Good, The Bad and The Ugly
- Money Morning:
Why Wall Street Can't Escape the Eurozone
- Money Morning:
May Q&A: Shah Gilani on the Student Debt Bubble, Europe and More…
- Money Morning:
Forget Goldman Sachs; Only Fools Rush In
About the Author
Shah Gilani boasts a financial pedigree unlike any other. He ran his first hedge fund in 1982 from his seat on the floor of the Chicago Board of Options Exchange. When options on the Standard & Poor's 100 began trading on March 11, 1983, Shah worked in "the pit" as a market maker.
He helped develop what has become known as the Volatility Index (VIX) - to this day one of the most widely used indicators worldwide. After leaving Chicago to run the futures and options division of the British banking giant Lloyd's TSB, Shah moved up to Roosevelt & Cross Inc., an old-line New York boutique firm. There he originated and ran a packaged fixed-income trading desk, and established that company's "listed" and OTC trading desks.
Shah founded a second hedge fund in 1999, which he ran until 2003.
Shah's vast network of contacts includes the biggest players on Wall Street and in international finance. These contacts give him the real story - when others only get what the investment banks want them to see.
Today, as editor of 10X Trader, Shah presents his legion of subscribers with the chance to earn ten times their money on trade after trade.
Shah is also the proud founding editor of The Money Zone, where after eight years of development and 11 years of backtesting he has found the edge over stocks, giving his members the opportunity to rake in potential double, triple, or even quadruple-digit profits weekly with just a few quick steps.
Shah is a frequent guest on CNBC, Forbes, and Marketwatch, and you can catch him every week on Fox Business's "Varney & Co."
He also writes our most talked-about publication, Wall Street Insights & Indictments, where he reveals how Wall Street's high-stakes game is really played.