Thursday, May 19, 2011

Smoked Links



Charlie Chaplin, a tightrope and Missing Links

9:53 am (Hawaii) Are my horrible puns giving you pause? Do you wish I would stop with the LinkedIn wordy twists? Please don't mind my jibber-jabber. I've just gotten up from a 3-hour nap and by the time the cobwebs have left my head, the closing bell will have rung.


Surprised?

1. LNKD erupted Leslie Bovee style, rocking the street by lifting all the way up to 122.69 from 90.
2. Just as quickly — a matter of a few minutes — it dropped 20 bucks. You and I, the seasoned traders of yesteryear, were not surprised. But the young guns who got crazy and jumped in at 110 or 120 ... my, my.

3. LNKD, which had a total of $240 mil in revs last year, then rose again. It was a slower climb, but still impressive, going to 111. At this point, who's buying? Oh yeah, the traders 25 and younger. Maybe a few 30-somethings.

4. Inevitably, LNKD has no staying power. The drugs wear off and it has no legs to stand on. At 120, it had a market cap of more than $110 billion. Despite having less than one quarter of 1 billion in revs ... and $3 mil (not bil) in profits last year.


Oh, falling in love is fucking grand. It's the morning after when you realize what's hit the fan.

LNKD is now at 94 and going hardly anywhere for awhile. If I remember right, IPOs can't be shorted during these early weeks and months, so the shares are protected somewhat. But any rides above 100 are sheer madness and will involve you and rabid animals frothing at the mouth. In an 8x8 room. With only a tiny hole in a corner for escape. Best wishes.

It seems just a bit likely that a lot of people who normally trade silver and gold plays stood aside today just to enjoy the freaking spectacle of the LNKD circus.

Spot Silver has pogo-sticked from 35.50 to 34.90 to 35.75 to 34.60 in the past several hours. Now at 35.11 and showing some restraint here. I don't need any price to be stable to profit from it. This ain't about principles and long-lasting love and sealing my money to a marriage (for life). But at 35, Spot is in the middle of a jungle filled with malaria-infested mosquitos and multiple patches of quicksand. It's not out of the woods. Any other lame cliches?

I don't want to touch it, not the paper and not the physical. Well, I DO want physical, but if Spot drifts between 32.50 and 36 for a week or two, is it time to stay out of harm's way? Or is it time to load up my vault with a million 1000-oz bars of everything? (No, I don't have a vault. If I did, I'd definitely upload a few photographs and do the YouTube thing while wearing a zoot suit and fedora like a 1930s gangstar.)

No, this is a good, sunny, breezy morning in Honolulu. The most precious thing near me isn't metal. Maybe I'll go find that thing today.

Update 2:29 pm (Hawaii) Cramer mentioned that LNKD's available float for trading was actually only 7 million shares. Even at 94 mil, that was pretty small, but the brokers only allowed 7+ million to be allotted. That explains the crazy bounce and volatility. Cramer considers the LNKD situation comparable to an arsonist with gasoline at a fire. He says stay out. I hope people listen.


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