• Thanks so much for reading my diary and enjoy your evening.

I am calling it a day early now.

It has been a long day.

Thanks so much for reading my diary and enjoy your evening.

• I think that Home Depot and Lowe's could see some near-term upside, but I'll stay on the sidelines.

The homewreckers are on fire after a near-20% drop over the past few months.

My guess is that Home Depot (HD) and Lowe's (LOW), which have been very weak, could have a small upside trade in them going forward over the near term.

But after shorting them perfectly, I covered prematurely, so I am snake bit on the group.

As a result, I will stay on the sidelines with the remodelling group, which will get hit by the reduced cash flows into households as refinancings evaporate.

• Namely, yesterday's tranche.

Houskeeping item: I am sellking my ProShares UltraShort Russell2000 (TWM) that I purchased yesterday.

• I am sticking with position overnight.

The iShares 20+ Year Treasury Bond ETF (TLT) is getting jiggy.

I am sticking with position overnight.

• Here comes the hate mail.

Not surprisingly, I have gotten a vast amount of hate mail in response (already!) to my cult post.

As we all know, there is a group out there that can "give a check" but can't "take a check!"

I suppose the Zamboni machine just cleans the ice (and their memory) between periods!

• Gold's upward trajectory warrants the add.

With gold up $28 an ounce, I added to my iShares 20+ Year Treasury Bond ETF (TLT) long rental.

• Called an audible.

I called an audible on my Apple (AAPL) short and covered with a $2 gain.

I simply can't explain its relative strength, so I will move on.

• You will not find a more fickle bunch.

Beware of those who worship at the altar of price momentum.

Because, in the main, they are a fickle bunch of lemmings.

I am sorry to be so blunt. 

Simply watch CNBC/Bloomberg or read Tweets and daily newsletters today, and you will find even the most glib and self-assured bulls turn on a dime when stock prices move south. It's almost as if they had no memory what they said or wrote the day or weeks before!

Indeed, last night I received an email from a prominent "talking head" and good pal (I will not name him out of the respect I have for him over the years) who basically ridiculed the logic and conclusions in my "Top 10 Reasons Why the Market May Have Peaked for the Year " post from Tuesday. He actually implored me to change my mind.

Well, today, he, too, turned bearish.

I recently wrote about the growing self-confident bullish investment community.

Unfortunately, most of the lot are technically oriented day-traders who never even looked at the companies' balance sheets or income statements before exclaiming their enthusiasm for the issues/stocks. They are mostly trend-followers who worship at the altar of price momentum.

Following prices and gazing at charts makes for an easy, simplistic and necessary strategy for a business commentator, strategist or investor who spends much of his time preparing for media engagement

This is why it is important to do your own homework -- as Jim "El Capitan" Cramer  (who is a clear exception to my characterizations above!) implores  you to -- and come to your own independent investment conclusions.

And the theme of this column also applies to my musings as well as the others!

• Here are his thoughts at midday.

Midday musings from Sir Arthur Cashin:

Spike in ten year yield is primary catalyst for selloff.  Over 2.8% no bids ¿ below some timid bids.  McClellan notes that when we broke Dow 50 DMA in June, it turned into a -350 day.  Selloff has done some chart damage.

Wal-Mart guidance and prior retail reports suggest U.S. consumer may have entered the witness protection program.

Run rate at 12:45 projects to an NYSE final volume of 690/770.

• This might portend further strength in Potash et al.

Deere's (DE) shares are up smartly.

The stock typically moves with the ags/fertilizers.

This might portend further strength in Potash (POT) et al.

• Or so I hear.

I am hearing there is an industry call on the potash market that is more constructive on pricing with checks revealing firming demand out of Asia.

I am trying to find the source now, but if accurate, this will help Potash (POT) and the sector.

• Small and on a scale.

I am back shorting Apple (AAPL), which is now up $8 from my premarket cover, small and on a scale.

• Cumberland Advisors' David Kotok points out striking (and alarming) parallels.

Stated simply:

When we put all the data together, we come up with a very low and falling earnings growth rate for American domestic and multinational companies. At the same time, those companies now have an aggregate value roughly equal to US GDP, approximately $17 trillion. Only twice before has the ratio of the total market value of US stocks divided by US GDP exceeded the present level. When did that happen? It occurred in 2007 at the pre-crisis peak, and it occurred when the technology bubble hit its peak at the turn of the new century. We know what happened in the wake of both those events.

Amen to that Sir David!

• I am buying more shares under $19.

I am adding to Altisource Residential (RESI) under $19 -- small and on a scale lower.

• The company has a rather lengthy runway to revenue and profits in the years ahead.

My first buy today is Radian (RDN) at $12.85.

Jim "El Capitan" Cramer has waxed enthusiastically and extensively on the name.

The company, despite an expected pause in the housing recovery, has a rather lengthy runway to revenue and profits in the years ahead.

The shares have come down recently, and I believe this is an opportunistic buy (for investment).

Here is a six-month chart.

More in the next few days.

• That would be my guess.

My guess is that we have seen the lows for the day, though I don't expect a meaningful rally today.

P.S. -- Linking Wednesday and Thursday's price action together confirms my ludicrous forecast yesterday morning -- but with an asterisk!

• If they stabilize, I will expand my TLT long rental.

I am watching the homebuilder stocks.

If they stabilize, as they appear to be doing now, I will expand my iShares 20+ Year Treasury Bond ETF (TLT) long rental.

• The company's cash flows were much weaker than the analysts suggested.

I also blew the short on Nationstar (NSM).

As I will discuss next week, the company's cash flows were much weaker than the analysts suggested.

Moreover, Nationstar changed its discount rate to increase second-quarter 2013 EPS.

• The Lindsey Group's Peter Boockvar summarizes today's economic data.

A good summary of today's economic data from The Lindsey Group's Peter Boockvar:

In the sharp June selloff in US Treasuries, foreigners unloaded $40.8b worth, the biggest monthly amount on record but some of that ($12.5b) came out of the Bahamas and the Cayman Islands likely via hedge funds. The UK was a seller of $30b worth of notes/bonds but some of that could also have been hedge funds and foreign holders doing business through London. The biggest holders, China and Japan, were net buyers of notes and bonds but let a huge amount of short term bills mature and only reinvested a small portion of them to the point where China, Hong Kong and Japan reduced their total holdings by a combined $52b. Foreigners were also big sellers of US stocks in June, unloading $26.8b worth, the most since August 2007.

Industrial Production in July was flat m/o/m vs the estimate of up .3% and June was revised down to a gain of .2% from .3% initially. A drag was a .1% drop in manufacturing as auto production fell by 1.7% and machinery was down by 1%. Mining though was up by 2.1%. Bottom line, a y/o/y gain of just 1.4% in US Industrial Production is the slowest rate of gain since January 2010 and points to a still modestly growing economy.

The Philly region manufacturing index fell to 9.3 in August from 19.8 and was below the forecast of 15.0. It still though is the 3rd best since October '11. New Orders fell by half to 5.3 and Backlogs were lower by 1 pt. Shipments were flat. The Employment component fell by 4.2 pts but after rising 13 pts in July. The Workweek fell to -2.6 from +6.6. Inventories were negative but less so. Prices Paid fell 4 pts but Prices Received were up by 3.0. The overall 6 month outlook fell by 6 pts but after rising by 11 in July. Bottom line, the NY and Philly regions show manufacturing growing in August but at a pace a bit less than July.

The NAHB home builder survey hung in there in the face of higher rates as its index rose to 59 from 56 and vs the estimate of 57. Present Conditions rose by 3 pts to 62 and the Outlook was up by 1 pt. Prospective Buyers Traffic though was unchanged at 45 (still below 50 breakeven). Bottom line, the pace of home building is so far below historical trends that any signs of improvement are well received by the industry but higher rates matter as seen with the 6 month low in the purchase component of the weekly MBA data so we'll see how long the builder optimism lasts. Hopefully it does.

• I have consistently written that the rotation concept was a figment of the bulls' imagination.

Can we finally put to bed the concept of the great rotation out of bonds and into stocks?

I have consistently written that the rotation concept was a figment of the bulls' imagination.

• My average cost is now under $104.

I have been buying iShares 20+ Year Treasury Bond ETF (TLT) on weakness

My average cost is now under $104.

• Here is a glance at some of my current long and short positions.

I remain short SPDR S&P 500 ETF Trust (SPY), iShares Russell 2000 Index Fund (IWM), PowerShares QQQ (QQQ), Market Vectors Retail ETF (RTH) and Berkshire Hathaway (BRK.B).

And I am long Potash (POT), Northwest Bancshares (NWBI), Monitise (MONI.L) and Altisource Residential (RESI).

• I am completely out of this trade.

Housekeeping item: I have covered my IBM (IBM) short this morning.

• And the award goes to...

It's official. The jerk of the week award goes to my premature cover of Home Depot (HD) two weeks ago.

• Discipline trumps conviction.

I have stopped out my losses in the Prudential (PRU), MetLife (MET) and Lincoln National (LNC) shorts.

They are all overvalued, but discipline trumps conviction at times.

• I have a tight stop on this one.

With the spike in interest rates to over 2.80% on the 10-year U.S. note, I I just took a long rental in iShares 20+ Year Treasury Bond ETF (TLT) at $107.1 (with a tight stop), as economic activity is probably not as strong as markets are implying.

Just ask Wal-Mart (WMT), Macy's (M) and Cisco (CSCO).

• Here is Grant's take on taking a shot.

This morning's musings from Southwest Securities Mark J Grant:

"I know what you're thinking... Did I fire six shots or only five? To tell you the truth, I forgot myself in all this excitement. This here's a .44 Magnum, the most powerful handgun in the world, and it can blow your head clean off. Now, you must ask yourself one question: Do I feel lucky? Well, do you, punk?"

-- Harry Callahan (Clint Eastwood), Dirty Harry

Money is often made by arriving in the pasture before the herd shows up. Sometimes it is made by holding a contrarian view that turns out to be correct. My focus is generally on not losing money but I have tried, in the last few days, to point out a couple of money making opportunities.

Now I am constrained by my Compliance Department from pointing to any specific security. I am not allowed to do this in "Out of the Box" for a variety of reasons that I respect and, in any event must follow, so if you are looking for me to point at specific bonds here it will not be happening.

Having then said that so you understand my restrictions let me share with you what I consider to be a very good macro play if you can find the right bonds and those are discounted Agency bonds, fixed or step-ups, with short calls where the yield to call approaches or exceeds a ten percent yield to the call.

These bonds are generally yielding more than bullets now and they are an out of favor segment of the Agency market. This is generally because people believe that yields will keep going up as the Fed tapers and that the call will not come into play. That is the herd mentality and it may be correct but maybe not and, if not, and yields go down once again then these bonds could shine like glittering diamonds in your portfolios.

"You miss 100% of the shots that you do not take! Ask your friends on Wall Street if they like those odds!"

-- The Wizard

Let's consider the play here in more detail. If you swap out of bullets you are likely to pick up absolute yield and shorten your duration. However the duration is off-set by the possibility of some big wins and not a few basis points. In fact, I would argue that there is very little downside to this play, the credit remains the same, yields are higher than current coupons so that, in my opinion, the risk/reward ratio here lies distinctly in the reward camp.

There are a number of good reasons why yields could head back down and calls would come into play including the Fed not tapering anytime soon, the decrease in Treasury funding, the notion that present yields as related to any taper are already built into the marketplace, an "event" in Europe or China, any global news that would send buyers back into Treasuries/Agencies, the return of Fear to the markets or just a shift in market sentiment. It could even be a major reversal in the equity markets that sends money back into the bond markets and causes lower yields.

My point here is that if you have a shot at making ten or more percent and it costs you virtually nothing to make the play that it should be taken. My advice -- take the shot!

"Those who are tardy do not get a fruit cup."

-- High Anxiety by Mel Brooks

• You all are in for a treat.

Let me be the first to congratulate and give all of my best to one of the great guys in the business media, my buddy/pal/friend Herb Greenberg, on his new gig at TheStreet.

Herbela is returning to his roots, where I and Jim "El Capitan" Cramer had the pleasure of working with him back in 2000!

You all are in for a treat and some very value-added research and commentary from Herbela.

Welcome Back, Herbela!

• Let's take a peek at the price behavior of the major asset classes during the overnight and early-morning sessions.

"Stocks sank on Wednesday due to concern that the Fed will announce a QE tapering at next week's Jackson Hole summit; and there were no Tweets from any operator about greenmailing some company."

--Bil King, The King Report

The rundown:

• S&P futures are down 14;
• Nasdaq futures are down 30;
• China Shanghai is down 0.9%;
• Nikkei is down 2.1% (government officials downplay the rumor of a corporate tax cut);
• European markets are down (investors beginning to question central bank guidance there and elsewhere);
• euro is up;
• gold is up $4;
• crude is up $0.70; and
• the 10-year U.S. note yields 2.77% (up 2 basis points day over day and at my "line in the sand").

Worth mentioning:

• Mr. Market continues to show signs of rolling over. The bull market in complacency may soon be over.
• Cisco's (CSCO) guidance was weak and the compnay plans to cut 4,000 jobs. CEO John Chambers' statement of a "mixed and inconsistent" economy weighed on futures last night. In his conference call, he placed the blame on Asia. (Note: Chambers will be on CNBC this morning, an important interview.)
• This morning, Wal-Mart (WMT) cuts guidance, owing to a difficult external environment. This follows Macy's' (M) miss. In other words, the domestic economy stinks.
• I remain net short based on a confluence of fundamental, technical, sentiment and valuation issues (all detailed in "The Top 10 Reasons Why the Market May Have Peaked for the Year").The core of my ursine view is that economic and profit growth expectations are too optimistic. The Cisco and Wal-Mart results confirm my pessimism. Too many are still worshiping at the altar of price momentum without recognizing how fragile the global recovery is. Weakness in Macy's, Wal-Mart and Cisco are not company-specific issues.
• I took a trading short rental in Apple (AAPL) on Wednesday.
• A civil war in Egypt seems to be erupting.
• More evidence in macro releases and specific homebuilder orders suggests that the U.S. housing market's growth rate is decelerating.
• The President to Senators who are urging Yellen to be appointed to the Fed Chair -- shut up already!
• The July PPI was unchanged (against consensus, which assumed rising gasoline/oil prices, of +0.2%). CNBC's Rick Santelli ranted about the BLS inflation data in a debate with Steve Liesman. I side with Rick on this one as I detailed during the week. As an example, see this chart of September gasoline futures -- the BLS stated gas prices in July dropped by -0.8%! This really makes no sense. (Note: Gluskin Sheff's David Rosenberg leaves the deflation camp this morning.)

In the press:

• The Wall Street Journal -- The Fed fools with our investments; "Can the Democrats Retake the House in 2014?"; "Why Justice Should Back the Airline Merger."
• The New York Times -- Emerging markets' economies are slowing.
• CNBC/"Mad Money" -- Jim "El Capitan" Cramer is now less bullish.
• Financial Times -- The heat is onHollande.

Possible economic and earnings catalysts that could influence the markets today:

• U.S. Empire Manufacturing, CPI, and jobless claims (all at 8:30 a.m. EDT).
• Initial jobless claims (335,000 estimate), continuing claims (3 million estimate).
• CPI (+0.2% estimate), Core (+0.1% estimate).
• U.S. industrial production for July (9:15 a.m. EDT, +0.3% estimate).
• Capacity utilization (77.9% estimate).
• U.S. NAHB housing survey and Philadelphia Fed (both for August and both at 10:00 a.m. EDT, 15.0 estimate for Philly Fed).
• Jefferies Global Industrials Conference (Aug. 12-Aug. 15).
• Analyst meetings -- Ford (F)
• earnings before the open -- EL, KSS, PAAS, PRGO, WMT
• Earnings after the close -- AMAT, DELL, JWN

• Shares were down about $5.

Houskeeping item: Apple (AAPL) is trading down about $5 a share to $493.20, and I have taken in my short rental in premarket trading now.

• Empire, jobless claims and interest rates -- oh my!

Empire misses small, but jobless claims drop larger than expected.

Interest rates rise as the Fed loses control of the bond market.

• What, me worry?

The yield on the 10-year U.S. note is now 2.75%.

What, me worry?

Yes

• Shares are up to 47 pence on the London Exchange.

Despite weakness in the European bourses, Monitise (MONI.L) trades at a new high of 47 pence on the London Stock Exchange this morning.

Here is a good company profile from Wales Onlline.