I shorted down a burning ring of fire
I went down down down
And the flames went higher

Black Thursday? Or will The Fed return and carpet bomb the market with money?

I still maintain this has a few more months to run – watch the Shanghai Composite. We may have a head and shoulders pattern that is going to break down from an overall peak of 4910. If that rolls over and the market hasn’t had a big down day already, I am predicting more carnage.

My hedging is working somewhat well. I am still losing money, as I am net long overall, but it is acting as an anchor and letting me enjoy the show that is unfolding.

The real question? How is it that I managed to go short, while the hedge funds, qants and other foolish managers couldn’t see the forest for the trees? (Which raises the next question – Why am I not being paid millions of dollars per year?)

Jim Cramer and James Altucher (thestreet.com) seem to have woken up to the problem now, but couldn’t see it 3 months ago?!? I enjoy listening to their discussions, but it seems surreal that they weren’t sounding the horn before the crash.