Weekly Wrap-Up

Worst January EVER! What a way to start the year!  I’ve decided to delve into the bear case this weekend to see if I can talk myself out of thinking we’ve suffered enough at the 8,000 line.  I’ll be posting as I read in a Weekend Reading section but I thought it would be a good idea to first review what worked and what did not work in a choppy week .  After a solid and active week of picks last week ,  we went into this week with a much more cautious attitude.  Monday morning I warned that the VIX would fall and it was time to start grabbing those March premiums.  The VIX did drop 20% ( and spiked all the way to 34 on Wednesday ) but recovered nicely into Friday, which is why I was up all night Thursday working on our Buy List , as it was once again a good time to enter some hedged plays.  But on Monday Morning, I was in no mood to buy anything and my comment that morning was: " XOM and CVX together on Friday (15% of the Dow weighting) have me really, really, REALLY worried that we’ll get a -5% GDP along with poor earnings from them and people are going to act like the world is ending so it’s going to be a tricky play this week but lots of fun playing the ultras. " In the end, XOM and CVX did not kill us but the 33% decline in XOM profits didn’t inspire a lot of confidence in the XLE, which fell 6% from Wednesday’s silly high and finished at the low for the week.  The bottom-line takeaway from XOM’s report is that revenues are way off and even the best companies are getting hit very hard - what chance do the little guys have?  I pointed out on Monday that January is supposed to be THE BEST month of the year for the markets - let’s hope not!  Of course I mentioned gold again, stating: " investors look for REAL safety as opposed to the very imaginary safety of fiat currency, no matter what country is issuing the paper " and the January chart really emphasises why I do, indeed, like gold . Rolling CAT puts we sold to the March $30 puts at $2 is not helping so far as CAT fell another 10% this week but it sure beats staying in the Feb $34 puts, now $3.62.  I said I still like them at a…