• Reminiscent of many yesterdays.

The speculative juices flowed freely despite reservations about Washington, D.C. today.

Just look at the near-50-point rise in the Nasdaq at the close of our trading session.

With such outperformance in the Anointed Ones (Netflix (NFLX), Priceline.com (PCLN), et al), Nazzie valuations are growing ever more stretched,- a condition than is growing reminiscent of many yesterdays of speculation. (I shorted more QQQs).

Thanks for reading my Diary today and enjoy your evening.

• Car sales took a breather in September off the strong sales pace seen in August.

Total U.S. vehicle sales in September were well below expectations of 15.21 million annualized, the lowest since April and vs. the estimate of 15.60 million. It comes, though, off a 16 million run rate in August, which was the highest since November 2007.

As interest rates rose in the May through August time frame, car sales actually started to accelerate off a flat line trend from November through April. Whether this was off-the-fence-type behavior to buy a car before rates continue higher is not yet clear, as there certainly was none of this action with respect to housing and refis.

Either way, car sales took a breather in September off the strong sales pace seen in August.

• Happy Anniversary

I wanted to offer my sincere congratulations to Jim "El Capitan" Cramer on his 2000th "Mad Money" show tonight.

I have learned over the last 14 years what a special investor, man and father Jim, the epicenter of TheStreet, is.

After all these years on "Mad Money" I have also learned how remarkable Jim's work ethic is within the framework and requirements associated with doing a one-hour program filled with comprehensive and value-added information five days a week.

Jim, as I have written in the past, is a tour de force. He is a (controlled) whirlwind, a unique investment professional who has made numerous sacrifices (personal and business) to deliver his uniquely informative investment lessons, interviews with senior corporate managements to the average retail investor.

I am proud to have worked side by side Jim all these years. And I am looking forward to many more years ahead together on RealMoney Pro.

But, frankly, I am more proud that Jim considers me his friend. For that I am blessed.

Kudos, El Capitan.   

• Largest equity and EFT longs.

Largest individual equity long is Northwest Bancshares (NWBI).

Largest individual ETF long is the Direxion Daily Small Cap 3x Bear (TZA).

• Knowing is half the battle.

So you know, I have spent most of the day adding to my small (but now larger) short exposure.

• It's not a coincidence.

I don't think that it's a coincidence that the market started to sell off coincident with the individual government agency funding proposal.

The proposal shows how far apart they are.

• Stated simply, these are uncertain times.

"Apple is a no-brainer."

-- Bill Miller, Legg Mason

We all have opinions on the market, on sectors and on individual stocks -- hopefully based on thorough analysis.

But we all make mistakes. (I certainly know about this subject!) 

I do have one comment about the degree of certainty that Apple (AAPL) is wildly underpriced expressed by Legg Mason's Bill Miller this morning on "Squawk Box."

Bill is smart and rich. He is a terrific bull market player. (This is not meant to be a "backhanded" compliment). 

As I have written, the only thing that is certain to me is the lack of certainty.

Stated simply, these are uncertain times.

And I would add that the last time I heard the words no-brainer from Bill was when he characterized Fannie Mae and Freddie Mac as such back in 2006-2007. He owned well over a 100 million shares of the government-sponsored agencies, and we proceeded to have a well-chronicled debate in the media about the "merits" of Fannie and Freddie, as I was way short the group.

The rest, as it is said, is history.

Here is the tape from this morning's CNBC appearance by Bill.

• Here are his musings at midday.

Midday musings from Sir Arthur Cashin:

Eerie calm at noon.  As I said on CNBC, it looks like an "Armistice Rally".  Open edgy and cautious.  When no bullets fly on TV (Boehner, Reid, McConnell, Obama) hope grows that they are talking off stage.  We'll know when President speaks.

Bulls also get help from Europe (spelled Italy).  Gold plunge part technical and part Golden Week (no China buying on top of India taxation slowdown).

Run rate respectable.  At 12:45 projects to 630/710.

• This morning's Apple sale is one, for sure.

I made a god-awful sale of Apple (AAPL) this morning.

Next up: Carl Icahn on "Fast Money Halftime Report" to discuss his dinner with Apple's Tim Cook.

• It looks like Letta will get enough yeas in tomorrow's confidence vote.

One of the factors helping today's market is Italy, as it looks like Letta will get enough yeas in tomorrow's confidence vote.

A member of Berlusconi's party is being quoted as saying that as many as 40 PDL party members were willing to keep the current government together. That is double the votes Letta needs. The MIB index is up 3%, and the Italian 10-year yield is lower by 14 basis points.

• Here is a table.

Below is a good summary, by manufacturer, of September auto sales:

• At $79.45.

I am pressing my PowerShares QQQ (QQQ) short at $79.45 now.

• The components in the release were not as strong as the headline number.

The September Manufacturing ISM came in at 56.2 compared to expectations ofo 55 and August's 55.7. This is the best print in about 17 months and compares to the long-term average of 53.

Survey data such as the ISM indicate that manufacturing activity has accelerated in the past several months after a soft patch in the summer.

That said, the components in the release were not as strong as the headline number.

For example, new orders declined, the production component was unchanged, the export number dropped, and order backlogs contracted. The only strong month-over-month change came in the employment component, up 2.1 points, to 55.4, the highest since June 2012.

The hard data are not nearly as strong as the survey data; factory orders and capex have been growing very slowly even as the ISM manufacturing index has lifted. Of the 18 industries surveyed by the ISM in September, 11 saw growth, but six saw contraction and one saw no change.

• Icahn tweets about it.

Speaking of Apple (AAPL), here is Carl Icahn's tweet on his Cook meeting:

• Slightly net short.

I have moved this morning from market-netural to a small net short exposure.

• Best not to finish that thought.

Break in: General Motors (GM) says its September sales dropped 11% from a year ago.

Even the company's big pickup trucks saw sales declines, with the Chevy Silverado down almost 11% and the GMC Sierra off 2%.

• Let's clear up some confusion.

There is some confusion in comments section on why I sold out my Apple (AAPL) long rental.

Firstly, a long rental is just that. It's a short-term lease not a two-year lease! It is an opportunistic trade. My market considerations are always overriding all my short-term stock rentals. (I am negative, so my long rentals are very shortlived in holding period.)

Secondly, I started (small) buying Apple for a trade last week at $483.60 and $482.55. I almost always trade around rentals, which I did with Apple last week, lowering my average. (Note: If I showed every trade, it would be confusing to subscribers, and frankly, since I trade so actively, it is next to impossible to do!)

Thirdly, I added disproportionately yesterday to Apple, substantially lowering my cost basis. (Note: Apple traded under $475 in early trading on Monday on the futures gap lower.)

Fourthly, Bill Miller at Legg Mason bulled up the stock on the opening. (He appeared on "Squawk Box" on CNBC)

Net-net, I made money on this rental.

I likely, subject to market view, will reenter the trade in a correction.

• I am still long Citi.

I just took in my JPMorgan Chase (JPM) short, and I am keeping on Citigroup (C) now.

• I am buying big under $22.60.

I am now adding aggressively to Direxion Daily Small Cap Bear 3x Shares (TZA) under $22.60.

• I sold out of my shares at $481.

I have taken off my Apple (AAPL) long rental at $481 just now for a gain.

Staying in motion.

• It will become my largest long on any strength.

On any strength Direxion Daily Small Cap Bear 3x Shares (TZA) will become my largest long.

• Let's take a look at the overnight and early-morning price action in the major asset classes.

This song is dedicated to the ones we don't love -- to our leaders in Washington, D.C.:  

We started to talk and you smiled

Sorta like you knew the way that I felt

You moved a little closer in a while

Then I knew my heart was startin' to melt

There was just so much I wanted to say

But all the words came out this way

Come on now

Let's lock the door and throw away the key now

(Shom dooby-dum dooby-dum-dum)

I can't wait to kiss you (oh no)

One little minute more.

-- Jay and the Americans, "Let's Lock the Door (And Throw Away the Keys)" 

Let's take a look at the overnight and early-morning price action in the major asset classes.

The rundown:

• S&P futures are up 5 (not terribly surprising to me);
• Nasdaq futures are up 10;
• Nikkei is up 0.20% (Abe moved forward with a plan to raise the consumption tax from 5% to 8% on April 1 and also unveiled offsetting measures to minimize the impact to overall growth);
• China Shanghai is up 0.68%;
• European markets are up;
• euro is up;
• crude is flat;
• gold is down $32; and
• the 10-year U.S. note yields 2.65% (up 3  basis point day over day).

Worth mentioning:

• Despite Monday being the last day of the trading quarter, it was another weak pre-government-shutdown trading session. Breadth was weak, and the league-leading financials suffered along with some slowdown in selected momentum plays.
• I added to my trading long in Apple (AAPL) and reestablished my bond short ProShares UltraShort 20+ Year Treasury (TBT) yesterday. As well, I added to my Citigroup (C) long investment position, I sold my J.C. Penney (JCP) long rental for a small loss (it was reported after the close that Perry Capital has materially reduced its stake), and I continue to buy Direxion Daily Small Cap Bear 3x Shares (TZA) and Northwest Bancshares (NWBI).
• I wouldn't be surprised to see a downside reversal from the current futures strength in premarket trading. I'm not doing anything -- yet.
• I am currently market-neutral and plan to expand my short book on market strength. I am wary of both top- and bottom-line corporate sales and profits for third quarter 2013. Some are surprised that the futures are higher today -- as I mentioned yesterday, the Fed trumps a short shutdown of our government.  A longer shutdown, not so much. My opening missive yesterday offered up a potential market-disruptive factor that goes beyond our shores. As well, I sized up the weakening fundamental and technical backdrop that investors face. I closed the day by writing this --
  
  Ask yourself this multipart question if you just watched the Republicans and Democrats talk over themselves onCNBC just now: With profit margins 70% above the five decade mean, top-line growth of only about 2% (ex-financials), corporate profits -1% (ex-financials), a P/E ratio that has risen from under 14x to over 16x and given that the U.S. political leaders in Washington are inert, irresponsible and more partisan (than at any time in history), do you see a compelling need to buy stocks now in light of the S&P 500's rise from 666 to 1680 since the generational low? I rest my case!
• As I mentioned yesterday, I am wading back into my bond short. (I paid $75.30 for TBT.) The odds of an October or December tapering are now diminished.
• The government shutdown has begun. About 800,000 workers will be furloughed, and discretionary spending will be frozen (one third of total federal spending). Mandated spending continues, including social security/medicare/Medicaid/debt service. According to the pundits, every week of a shutdown shaves 0.2% from fourth-quarter 2013 GDP. A prolonged shutdown, however, would dent already fragile business and consumer confidence and could result in a more significant impact on the markets than is generally expected. It is difficult to see how this impasse between House Republicans and Senate Democrats gets resolved, though it certainly will be, because the House is adamant that any continuing resolution to fund the government include something that either delays parts of ObamaCare, changes its composition of coverage or changes its sources of funding. The Senate is likewise firm in its position that a continuing resolution be clean -- that is, have nothing in it at all with respect to ObamaCare.
• The world according to Peter Boockvar --
  
  "Celebrate good times, come on!" I really, really dislike this song but couldn't help singing it when I saw the S&P futures up 8 pts when I first checked my screens this morning. But the partial bounce back in the S&P's (now up 4) this morning on the official news of the lack of a 2014 budget reflects two things. 1)The market believes the subsequent shutdown will be temporary and the eventual agreement will be wrapped up with a debt ceiling deal in the weeks to come and 2)the Fed won't be tapering any time soon with the now GDP risk (however moderate) from the partial close of the government. Assuming #1 happens, I repeat that #2 will continue to be the main thing the markets are focused on in addition to earnings in coming weeks. The one casualty though of both the fiscal and monetary challenges is the US$ with the US$ index (heavily euro weighted) about to break below 80 for the first time since February. Gold by the way was above $1600 the last time the US$ was this weak.
  
  The other story of the morning is data driven with a slew of manufacturing PMI's released by markit.com. In Asia, China, Taiwan, Indonesia, Vietnam, India and South Korea saw modest m/o/m increases. The final EU manufacturing PMI was left unchanged at 51.1 and UK's PMI moderated slightly but at a still good level of 56.7 vs 57.1 in August.  The US ISM index is expected to fall a touch to 55.0 from 55.7.
  
  Also of note, the number of unemployed in Germany in September unexpectedly rose by 25k vs the estimate of a drop of 5k. Their unemployment rate ticked up to 6.9% from 6.8%. Italian bonds and stocks are bouncing back after the political driven weakness over the past week and ahead of a likely confidence vote tomorrow where some of Berlusconi's supporters may leave him.
  
  In Japan, the Q3 Tankan report showed a gain of 8 pts to +12, 5 pts above expectations and the best level since 2007. The small business services index within Tankan rose to the highest since 1992. This positive data also came with household spending in August which unexpectedly fell (higher inflation but lagged increases in wages) and the unemployment rate which rose to 4.1% from 3.8% (but jobs to applicant ratio ticked up). In the aggregate, Japan's economy is getting better and Abe overnight as expected is using this as license to increase the consumption tax to 8% from 5% in April which the negative economic impact he hopes will be offset by a 5t yen stimulus plan. We'll see.
• It appears that there will be no jobs report on Friday (which is good for me because I will be out of the office traveling back down south to Florida).
• Here is an interesting San Francisco Fed paper.

In the news:

• Project Syndicate -- "America's Endless Budget Battle."
• National Journal -- "Bill Clinton: Driving the GOP to Extremes"; "A Phony Farewell to Arms."
• Foreign Affairs -- "The Enduring Appeal of Silvio Berlusconi." 
• The New York Times -- "Beyond Berlusconi."
• The Wall Street Journal -- "Fiscal Monkey Business"; No Tapering Soon if the Fed Looks at Labor."

Some possible economic and earnings catalysts that could impact the market:

• Australia rate decision (early Tuesday morning).
• China National Day (China Golden Week starts) -- China stock trading closed between Oct. 1 and Oct 7.
• Japan's Abe to announce plans to raise the consumption tax.
• Eurozone manufacturing PMI for September (4:00 a.m. EDT, already out, see above).
• Eurozone unemployment rate for August (5:00 a.m. EDT, already out, see above).
• U.S. manufacturing ISM for September (10:00 a.m. EDT, 55 estimate, Markit 53.1 estimate).
• September auto sales (total 15.6 million estimate, domestic 12.1 million estimate).
• Wells Fargo Retail & Restaurant Summit (Oct. 1-Oct. 2, Boston).
• Enrollment for the health care law's exchanges begins on Oct. 1.
• Splunk Worldwide Users Conference (Sept. 30-Oct. 3).
• Analyst meetings -- FRT, PCL, PRGO, Roche, UTX.
• Earnings before the open -- ATU, AYI, WAG.
• Earnings after the close -- GPN, RECN.

• For $22.62.

I am paying $22.62 for more Direxion Daily Small Cap Bear 3x Shares (TZA) in premarket trading now.

• Credit Suisse raises its price target on Citigroup.

Kass KatchCitigroup's (C) price target is raised from $60 to $65 at Credit Suisse this morning. (Note: The shares held their trend line yesterday.)