Thursday, April 26, 2007

A Day of Dithering

I've had some anxiety about holding FMD into earnings. My anxiety is only increased because I've not been sleeping well due to a right shoulder injury. It's one of those pulled muscles that keeps getting injured. Anyway, it hurts like hell at night, so I don't sleep well. (There's a point here, eventually).

After checking on a few things this a.m. in the market, I elected to go through my freezer(s) and take inventory and prisoners if need be. I have two side by side refrigerators--one in my kitchen and one in the garage. The one in the garage seems to have more beer in it than food. I ditched my old chest freezer since it is a pain. I pulled everything out and washed everything down. It's gleaming. I also found some deer meat.

I'm not a hunter, though my son and some friends are. If you are going to kill something, you need to eat it. So unwrapped this right front shoulder, defrosted it, cut all of the meat off for stew and then chopped the leg joint giving one to Macy and one to Greta. I felt like Hannibal Lechter. I'm fixing stew with the meat. I marinated it in vinegar/water and garlic. The vinegar pulls the blood out. I'm going to honor this deer's death by having it nourish our family.

My point...well after lack of sleep and all of this activity, I had a nap. Now I don't nap during the day very often, but I did find that after my nap, my FMD had made a nice recovery. And the nap, and no doubt some sublimation of worry, gave clarity to my decision making: (1) I sold all of my 1500 shares of FMD for a reasonable gain; and (2) I bought 10 Sep 40 calls. My gain more than paid for the calls.

See my conundrum was whether or not expectations were so low that anything would seem fine; and the stock would go up. (I could only pray for an Amazon, and I never pray about stock outcomes!). But I felt there was equal chance for a 10% loss. I felt that buying the calls with the gain at worst would be break even. It's currently at $34.55 in the after market on Mom/Pop orders, for there is no real volume to speak of. That would have been an 8% loss, if it were to stick. So, I think that I made the right decision.

AMZN had the most amazing day. Seamus on BC's site noted that Market Peculator had a 'short after noontime' suggestion. Well, that would have been a wee bit nasty for someone, as it looked like someone put acetylcholine on the fire!

--------------------------------------------------------------------------------
Now MarkM poses some points in the comments about fixed income v. real stock market gains. If you do not already go the GMO site, though you must register, but please do so, for it is worth it. I promise--and read Jeremy Grantham's letters as well as their outlook.

I'm not quite prepared to write about it. I'm also reading a Fed working paper. I'll distill that along with JG's letter and write up a few amateur observations.

12 comments:

Seamus said...

Leisa

I like the way you progress from a right shoulder injury to an “unwrapped right shoulder” prepared for dinner. It caught my attention as I know a few things about right shoulders, but that’s another story (thank you SYK). A good therapist or masseuse can sometimes isolate a muscle like the infraspinatus and work out the kink if that’s what ails. Makes sleep a little easier once it’s healed. However, the reoccurrence sounds like you’re not letting it heal. Good luck!

Yes, I saw the afternoon activity in AMZN. Looks like there may have been more than the Market Speculator short. WOW!

Big day in Japan tomorrow as a market holiday on Monday, April 30 makes Friday as the end of month for economic indicators. More importantly, the BOJ meets although I anticipate no action on rates. We’ll see how the $USD holds up overnight.

Leisa said...

Seamus--It it had been a snake---my right shoulder and the deer's right shoulder combo never occurred to me. Duh!

russell120 said...

If your refrigerators or freezers are roughly equivalent style wise, you should put the more energy efficient one (usually the newer one) in the garage. It can handle the higher delta T (temperature difference) much more economically. Putting an old beater refrigerator in the garage can be a bad idea from an energy cost perspective.

Leisa said...

Hi Russell--

The garage has no delta T as it is heated and cooled along with the rest of the house. The garage fridge is a nice fridge--but bought at Sears scratch and dent.


When we added onto our home, we ended up heating/cooling as much square footage as the original portion. Though we had energy efficient Lennox units (in 1985), the new unit(s)--I say units as one of the original Lennox units failed and had to be replaced-I spend about $100 less per month heating 2x the square footage. Amazing.

AngelaV said...

Leisa,
How did the stew turn out? I've tried cooking deer a couple of times, but it always turned out awful. After marinating, do you prepare the same as a traditional beef stew?

Thanks!

Leisa said...

Angela--I didn't have enough time to cook it long enough, so I'll have it on Saturday. Tonight is my daughter's B-day.

I'll roll the meat in a seasoned flour mixture, then I'll brown it and put it in a braising liquid (beef stock, and maybe even some wine). I'm going to cook it for about 3 hours, very low--may even just do it in the oven in an enameled cast iron covered pot. I'll add the vegetables in the later part of the cooking time so they don't get limped out.

I'm wondering if the meat is too lean for this method. I'll research first.

Here's a couple of ways to cook other pieces:

Rump--Make a mirepoix (carrots/onions/celery) and place your meant on that. Then take bacon and lay the bacon strips over the rump roast. Cook in oven (I forget how long)--covered--until desired doneness. Barding the roast with bacon helps.

Tenderloin: I found this terrific recipe (I think at cooks.com)--I looked quickly but could not find it. But it has garlic thyme etc in red wine (use a Cab). The key is to treat the tenderloin lightly to heat. If you don't like med rare meat, it's best to pass on this cut.

I'll update on the stew. Thanks for asking.

maggy said...

No comments about refrigerator or deer meat.... here. Good luck on your stew, though. The best use of deer meat(in my experience)is deer sausage.

Found you through Bill Cara. Glad I did. Interesting that you read and re-read the Zurich Axioms. Great book. How did you find it?

MarkM said...

So the macro data, which has looked pre-recessionary for months, now looks what, NEAR RECESSIONARY? The risks have been incrementally rising along with the market. To me they now look damn near untenable to the bullish case (not that my opinion matters). This is what moral hazard produces. There's a very big camp out there that apparently believes that rate cuts save all.

Leisa said...

Maggy--thanks for your note. I think I found the Zurich Axioms on Barry's site.

MarkM--Oh I agree with you. But, do see my post (I tried to do some more heavy lifting!)on Booms. I think that the real conundrum to these markets continuing to stay afloat are (1) real interest rates that are still too low; and (2) wide variation in currencies.

russell120 said...

You ac and heat where your car is parked? You are decadent!

Leisa said...

Well, you must understand that alot of communing goes on it that garage. It really is like living space. We can and do shut the vents off. We have one unit that heats/cools the entire space--which includes an upstairs bedroom for my daughter. We also have a woodstove in there to gain some heat efficiencies. So it is not completely decadent!

russell120 said...

A lot of my neighbors have TVs in their garage, and one neighbor went so far as to have a wide screen in their garage so they could bar-b-que and watch NASCAR at the same time. So I understand the the impulse.

It's interesting that your food posts get so many responses. Maybe you should rename your blog the flavorful financier.