Our Bernanke which art in the Federal reserve
Hallowed be thy name
Thy kingdom come
Thine will be done
In none-US countries as in the US.
Give us this day a reasonable discount rate
Forgive us for our defaults, as we forgive those who default against us.
and lead us not into temptation but deliver us from falsely rated mortgage backed securities.
For thine is the kingdom, the power and the glory for the duration of a 30 year mortgage agreement.

Amen

(Keeping it light on a Friday before a holiday weekend, folks.  Enjoy it!)

Just a quick note about options

I am asked about option education.  I have talked about this before, but I wanted to reiterate that there are a ton of free resources.  888options.com is a great place to start.  I also highly recommend watching the archived webinars on the CBOE web site.

Just learned something today that I wish I would've known before.  UNG gapped down over 1% this morning while the price of natty gas stayed pretty well flat.  I suppose it's typical to notice this sort of thing and actually take an interest after you put some money into the mix.  I found a nice little site specifically for this ETF at http://www.unitedstatesnaturalgasfund.com.

The holding information in the link below.  And as it turns out, apparently the UNG shares were simply bid up past the NAV and snapped back into reality this morning.  NAV is calculated after 4pm each day.

http://www.unitedstatesnaturalgasfund.com/ung_holdings.asp

Rule #1, always understand what you invest in or trade.  Rule broken, lesson learned.

So it took one day to start the bull whining machine again.  Cramer had his usual round of whining and then later stated he wasn't going to whine and proceeded to whine some more.  This is par for the course.  The thing that took me by surprise was a guest on Bloomberg who casually mentioned that "since the markets are in turmoil".  Was I the only guy alive during 2000-2003?  Maybe I'm older than I thought and should be in a rocking chair telling these snot nosed kids about how the market was back in my day.  Over 3 years, the S&P 500 dropped 50%.  It was not up for the year like it is now.

If you're not a big short seller or like to put in limits on shorts and walk away, you may not be entirely familiar with the uptick rule.  This rule was introduced in 1934 by the SEC and requires that any short sale order with a price above the current price must be filled on an uptick.  Somehow it was believed that short sellers drove prices to unrealistically low prices.  I'm sure it had nothing to do with buyers driving the prices unrealistically high to begin with.

Made up for lost ground this week.  The major indexes are back into positive territory for the month.  The Dow is up 1.26% for the month of August and the S&P 500 is up 1.65% while the Nasdaq is lagging, up only 1.18%.

One of things that's been encouraging with these picks over the last few months is that when the market is up, the picks are way up.  When the market is down, the picks seem to go down just a bit more than the major indexes.  This week is a good example.  The major indexes are up around 2.3% (with the Nasdaq up nearly 3% for the week) and the picks are up a whopping 5.78%.  Past performance does not guarantee future results and all of that, but it could be worse.

Cheap money has become a given up until very recently.  The subprime problem is still not truly as wide as projected, but just like the market, emotion has taken over and it has been blown out of proportion.  So now we've got lenders that are getting close to the other extreme.  You hear of stories of people with good credit having a hard time getting loans.  Certainly this is as backward as the other extreme of just a year ago.  We couldn't even say "bad credit" it was called less-than-perfect credit (gag).

Just opened a small long natural gas position via UNG ETF.  The SEP07 future was at 5.68 (spot price around $5.81) and my order was executed at $36.65.

Total speculative play.  I've been eyeing natural gas for awhile since it hit this level in mid-July.  It proceeded to rocket but has since fallen back to levels below where I liked it in July.  I'll be wading into it slowly.  If it drops below 5.40, I'll look to add to the position and more still yet if it drops below $5.

A new nuke-u-ler ETF made its debut yesterday.  I know that a lot of people have been asking for this exposure, but was surprised to see that it traded about 65,000 shares on the first day.  This is pretty good for an ETF that is so focused.  Typically everyone wants the ETF until it starts trading.

If you're interested in learning more about this ETF it is offered by Van Eck and the symbol is NLR.  The ETF tracks the DAXglobal Nuclear Energy Index (DXNE) which follows companies that have a market cap greater than $150 million and are engaged in the nuclear energy industry.

Short ETFs are becoming more and more commonplace.  When I did actual short selling way back when, shorting was something most people had never heard of.  I'm talking about folks who have a 401K or IRAs and don't care much about understanding how the markets work.  I find that more and more people understand shorting these days especially with the relatively recent introduction of inverse ETFs.  I have yet to put a penny into them, but have continued to watch them and keep them in the back of my mind as a consideration for my portfolio.  As for now, I still prefer bearish option spreads instead of actual shorting.

 Some of the benefits of inverse ETFs are:

1. You can short in a cash account.  If you short stock, this requires a margin account, not so with short ETFs (or bearish debit spreads).

Now that there's content and commnets, I've been playing around with the layout and various skins for the blog.  My goal is to get something that's readable and functional.  For example, there was no easy way before to get to the comments.  Since I encourage comments, I'd like those to be on the front page.  I also like a font that's readable.  I think this skin provides a reasonably good font.  The only drawback is the color scheme.  Orange doesn't really do it for me.  I'll probably keep this skin and try and customize the colors a bit as time permits.

I also wanted a skin that was not too constrictive.  Since I post a lot of charts and pictures, I needed something that isn't confined to some small box.  Again, I think this skin does a reasonably good job.

Of course, your comments are welcome.