2011-08-02nd (Tues)

In the previous trading session I had no positions.

I was 100% in Cash.

In today's trading session all US markets imploded because the Debt Ceiling solution was a compromise deal that both Democrates and Republicans disliked, and worries of global economic slowdown has been moved from the back burner to the front.

Article - "Stocks on long losing streak as economy weakens - Dow falls 265 points; stocks extend losing streak as economy looks weaker by the day"
http://finance.yahoo.com/news/Stocks-on-long-losing-streak-apf-546864801.html?x=0&sec=topStories&pos=5&asset=&ccode=

Although Moody's gave face to Uncle Sam by slapping him on the wrist, China took a more realistic approach and examined the facts then made a judgement call.

Article - "China Rating Agency Downgrades US Debt"
http://www.cnbc.com/id/43996450

We may see more of this event unfolding in the days to come.

Bill Gross at PIMCO was interviewed on CNBC today.

My interpretation is he is not buying and holding treasuries in duration for cash flow, but will be trading them for short term profit.

Bill is not going to sit on the side lines and do nothing, he is going to act like who he is for it is in his core DNA and this is too exciting for him to ignore.

Article - "Next Fed Easing to Include Inflation Target: Gross"
http://www.cnbc.com/id/43991107

Ultimately as trader only the trades matter.

Our highest risk speculative commodities futures and forex portfolio took a beating that made our heads spin.

Our purchasing power was significantly reduced and we can no longer take liberal shot gun swings at the market, instead we have to veto nine out of ten proposed trades and only take the most confident sniper trade.

Our first line of credit was activated on 2011-06-16th (Thurs) and our second line of credit was activated on 2011-06-29th (Wed).

Total equity is 0% of June 1st and we are committed to trade ourselves back to our High Water Mark.

Stay Tuned,

Jeff
(2011-08-02, 23:48 pm EST)