Another One Bites the Dust

What I find really interesting is the amount of losses that have built up in the banks that are failing now. WaMu had $31 billion. Wachovia's assets will be written down by $42 billion by Citigroup. It's amazing to me that these losses weren't reported earlier. Why not? Because then these banks would have been closed earlier.

While the whole banking system is showing some serious strain, in the long run, this is bullish. These writedowns need to occur. It will still take years to rebuild, but this is a step in the right direction. When you have a problem, the first step to recovery is to admit the problem.

So, I just took a 50% hit on my bottomfishing expedition with NCC. But, due to the luck I've had with the rest of my portfolio, I'm still up. Slightly. The only thing that's not working the way I thought it would is PWE. I'm afraid that I've misjudged how tied to the price of oil they are.

The only player on Wall St. not to make a move yet is Goldman. Do they buy NCC here?

Oh, and don't forget the bonds. The 30-yr is up to 4.23% from 4.35%.

The smart money from Barron's has the universal opinion that the bailout will give a short-term bounce (a month or two) but we will be right back in the bear market through the end of the year.

What does this mean? The bounce is already priced in. Time to sell short now. The only thing left is tech. However, I don't know the sector too well, so I'll have to make some room on my portfolio if I want to short it. But I may just wait. The VIX is at 39 (!!!) and the bailout will undoubtedly bring in some more buyers for stocks. I just believe that the bailout bounce will be shorter rather than longer. Maybe just a week.