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This is the title of the latest Buy rating on Prologis (PLD) from Merrill Lynch (MER).

I have a philosophical debate with the title.

Your perception and my perception are different.

There is only one reality.

You call it a Buy. But you can’t own any. That is a conflict of interest.

I can find so many flaws in the logic of this buy rating that it further emphasizes that my perception is THE reality. And my perception is that Prologis (PLD) common stock will be worthless.

I include below the calculation Merrill Lynch (MER) gives for NAV of (PLD).

It is an interesting set of numbers. It is wrought with flawed logic and useless assumptions. The analysis misses such a key point. A point that is so obvious. Prologis (PLD) has tipped. To the point of no return.

Here is all the analysis you need:

Prologis (PLD) common stock will be worthless.

Position yourself appropriately.

Peace

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Nice move in the ($VIX) today.

I am still very confident on my pink sheet thesis for Prologis (PLD).

My Valero calls (VLO) are still in play.

This morning I couldn’t resist adding a new put position. Visa (V) sure looks like a $22 stock to me.

It is very difficult to buy puts or call here. The $VIX is spiking and spreads have widened out. I still think we are in for quite a bit of a snap back rally. But who really cares? What matters is how am I positioned? Snap back rally or not, where am I finding cheap insurance?

Peace

Immanuuel Kant, in my view, created a great schism in the world of knowledge and between the people who think about it. The schism was the separation between those who think about and experiment with the natural world (today called scientists) and those who think about how scientists think about the world (today called philosophers of science).

-Heinz Pagels

In my view, I am creating a great schism in the world of Finance. I am separating market participants into two distinct categories. There are those who think about and experiment with markets (today called traders) and there are those who think about how traders think about the markets (today called volatilists).

-Mr. Volatility

Peace

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Yes. I am calling for a rally. How big? Not sure. Have we put in THE bottom? Not even close. But I think we will rally here.

Energy names look to have put in a short term bottom.

Financials have been ripped to shreds.

If financials don’t go down and energy rallies, the S&P ($SPX) will go higher. If Financials rally and Energy rallies, then the ($SPX) will go even higher. I’ll say two upside levels are 1288 and 1324.
As far as the NASDAQ ($COMPQ) goes, it looks very bearish, but many of these names are stretched way down here. A bounce is in order. Ultimately, I see (RIMM) at 45, but we won’t go straight there. I expect a bounce.

So where do I own insurance? I own upside insurance in Valero (VLO), I own downside insurance in Prologis (PLD). I am also inspired by some other ideas. Next week, when I am listening to the trading pit and watching the price action, I will decide if I find further inspiration and am compelled to buy or sell some volatility.

Peace

Andy Warhol’s Annunciation magnifies one little nuance of Leonardo da Vinci’s Annunciation.

Art is trading and trading is art.

The picture below is the endpoint. There is a series of lithographs that will help you understand the process that led to the endpoint.

A picture is not worth a thousand words to Mr. Volatility. A picture is worth a million little slivers of volatility.

Be sure to check out the Leonardo da Vinci exhibit at the Tech Museum of Innovation.

Peace

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