Market in a tizzy over "bailout"

Why do people "care" so much about extending the teaser rates on mortgages? It's because of the lost profit opportunity that a housing collapse would give to the bears. So they show their outrage. But let's look at the shenanigans in today's market.

We had a big gap opening, and then a small sell-off in the NASDAQ numbers. Big deal. The catalyst was a Piper analyst lowering estimates on Research in Motion (RIMM 113), down 9 points on the day. He's the same analyst that bumped numbers last week from 3.15 to 3.30; now his "channel checks" indicate he should tweak his numbers to 3.26 from 3.30.

Goldman Sachs jumped in and put a sell call on some tech and material stocks. Puzzled by this? You shouldn't be. Goldman downgraded the financials last week, and now they are screaming higher. Anyone remember that? Or does anyone remember the $2 trillion contraction in lending that was supposed to take place from the sub-prime and balance sheet fallout?

Next week no-one will remember Goldman's call.

Except for those that sold.

Don't sweat the background noise, just use the pullback to buy the financials if you haven't taken a position in them yet. It will take forever and a day for the shorts to cover, and they won't. They'll cling to the hope that things will get worse. They screamed Armageddon; it got priced into the stocks, now they're hoping they can cover lower?

It won't happen.

Wamu (WM) is giving buyers another chance to pick it up here at 19.28. Fannie Mae, (FNM 35.92) which has already bounced 8 points from where I advertised it last week will have a 40 handle by Tuesday and Freddie Mac, (FRE 32.81) which has moved 7 points since I advertised it last week, has another quick 5 points in it, and in a hurry, and CIT group (CIT 26.46) should print 30+ by Tuesday, and all of these stocks should gap higher on Monday.

The analysts are still pushing their spreadsheets and nonsense to the gullible, because Wall Street is not positioned for this rally.

And now, you get a V-ramp rally in the financials, like we had in the market.