January 23

Horrible weeks in the market. The administration led by Nobama is spouting rhetoric at an alarming rate. Its very evident now to even Middle America that Nobama has no idea what he is talking about and has even less of an idea on how to fix it. His lack of experience in business and in leadership is as clear as crystal.

Nobama still thinks that he can confuse Middle America with his fat cat banker talk and how he vows to fight. Now that people have had a time to settle down after all the initial outrage and educate themselves, its easy to see why Nobama is losing support.

Nobama talks about the fat cat bankers with their bonuses but these "bankers" are really traders and investment bankers. Trading and Investment Banking are not what caused the problem. The problem was 98% the fault of the Commercial Bankers. These are the people in this country that lend money. The money they lent to people who couldn't afford them, whether they were business or homeowners, is the problem. People aren't paying these loans back and that is whats hurting America.

Who is the main culprit of all of this? The government! With Fannie Mae and Freddie Mac leading the way. These two private companies with a political public agenda is what encouraged the massive speculation in the mortgage market with super low rates and minimal down payments. These are the big players setting mortgage rates and controlling the free market. Without these two giants, mortgages would require more down payments and would have higher interest rates. THESE ARE NOT BAD THINGS as we can clearly see from the past 3 years. Politicians claim that these low hurdles to home ownership were essential to helping lower income families and minorities into home ownership. We can now see that Politicians shouldn't be lowering the barrier of entry to people who can't afford housing. Let the housing market regulate who can and cannot afford to own a home. Politicians should regulate the mortgage market to stamp out discrimination and not just let anyone own a home they can't afford.

So we return to talk about Nobama's rhetoric. He is proposing rules to help stop a future crisis but he is going after the wrong people. He should be going after normal Americans and scolding them for trying to live above their means and borrow more money than they could afford but this is obviously out of the question. This would lose him votes! These traders and bankers are making huge bonuses because their portion of the industry is working. They bring liquidity to the capital markets and help companies purchase other companies. What's not working? Lending isn't working and it shouldn't. People are already overextended and we need a calm and orderly contraction of credit but Nobama wants them to keep lending even though it would be fiscally irresponsible to do. Why? Votes!

What does all this mean? Hopefully, Nobama is a one-term president and that the markets are rolling over and dying.

For the week 9/19 - 9/22

DOW down 436.37

S&P 500 down 44.27

Portfolio down $1,604.24

The portfolio is now down $329.66 for the year which is just crazy after the initial start. Had two trades that have gone ridiculously against me but they have time to work out so I'm holding on.

Made a new trade on the 21st. A risk reversal on C for the Jun 19 2010 expiry date.

STO 10 C Jun 19 '10 $3 put @ $.22

BTO 10 C Jun 19 '10 $4 call @ $.15

$207.36 in and $162.63 out for the put and call, respectively. A net credit (money in) of $44.73 after commissions. I make money as long as C stays above $3. I make really good money if C can go over $4. I believe C was trading around $ $3.27 at the time of the trade (2:09PM).