And the circus continues…

quick note on this morning…

-Pre-Market Indices: up nicely
-CPI: slightly higher than expected .4% and core at .2%
-Initial claims: up to 428k on expectations of 411k
-Empire manufacturing: -8.82 on expectations of -4.0

now taking this into account, which one of these looks out of place to you? Exactly. we’re initiating shorts. maybe just for the day. But the disconnect is glaring. We don’t put a whole lot of emphasis on expectations in things like the initial claims and the Empire survey because what does everyone else really know? But you look at the data and the trend is right on course. nothing has changed. We realize there’s a lot of noise in Europe(Italy passes austerity, etc) but we don’t buy it. The data will sink in as the day progresses.



LNKD quickie…

We’re trying to put a a more numbers based valuation together for LNKD. It’s been beaten to death everywhere but what the hell. It’s also recovered somewhat from the sell off and is back above $90(still well below our short call price of 98+ last month!).

As is the case with IPO’s there’s generally a lockup agreement of 180 days where insiders can’t sell. The lockup for LNKD is supposed to end sometime in November leading to a massive amount of shares potentially being added to the float as insiders sell. This has been pointed out elsewhere on the web and in analyst reports. Just something to think about.

We’re cautious about shorting right now at 90. As noted in our earlier post $110-120 will be pretty much an automatic short sign for us. We’re also skeptical about this latest market rally and if it continues we’d love to short LNKD into a big rally. The market will come back to earth.

As always, there is significant risk shorting stocks with a high short interest.


Please do yourself a favor and short LNKD today. Currently trading at 98+ up 4% so far on the day. It’s a bit high risk as the euphoria(short covering) could go on if the market decides to rebound next week. But this will see sub 90.00 at some point in the near future and IMO will undoubtedly be back at $75.

8/7/11 Update by 1689Capital…
well, that was a bumpy ride. And as suspected was quite risky(for us that’s ok). We’re not here to toot our own horns and as such we’ll say this latest short was covered at an insignificant loss earlier last week.

However, the original call remains and LNKD did trade well below 90 on Friday. Unfortunately for us we covered too soon. The levitation in the stock is quite unbelievable and we didn’t quite have the patience to stick with it. This was a short term trade and started bumping up against our time frame.

we will continue to assess the merits of LNKD as a short in the 110-120 range.