Well now here's some news!

First, Google (GOOG) reported this afternoon and absolutely blew away estimates. I mean slaughtered them. The aftermarket shows a decent pop - they're trading right around 480, which amusingly, is almost exactly $10 over the close - and almost exactly what the straddle on the options for April required today to open! Gee, those option writers get it right sometimes, don't they? I found it insane that they expected a $10 move on that - well, they did, and guess what - looks like they got one too. (The take-away from this is that when you are curious about what's going on, you can do a lot worse than checking the options market!)

Yahoo should get slaughtered on this in the morning. Here we have two direct competitors - clearly, Yahoo is not executing, while Google is. End of story. Yahoo is down big anyway due to their own miss, but if they aren't down another half-buck tomorrow I'll eat my Wall Street Journal. By the way, I bought some cheap PUTs right near the close, anticipating that there was no way the GOOG announcement was going to be good for Yahoo.

Next up, AMD. Huge miss. Not even in the game. I get skittish shorting stocks at $14, but I did it a couple of months ago with this one, made some nice money, and by God, I may have to do it again. I took a very cheap straddle this afternoon expecting a big move down (with a bit of protection) and I suspect its going to pay big in the morning. We'll see. Basically the story here is that INTC is kicking their ass, has been kicking their ass, and is going to continue doing so. I used to be a huge AMD fan, but in the last two years they just haven't been keeping up their end of the deal. I do like their processors - don't get me wrong - but the business is another matter. Especially booking these sorts of numbers. Keep this up and eventually you run out of money. Of course then there's the bombshell in the conference call - the company is open to some sort of "LBO" if "the deal is right". Oooook! Blatant attempt to pump the stock price against what is certain to be a slaughter tomorrow without it? Sorry guys, I call "big slime-ball" on this trick (LBO guys will want to buy something that's losing $500m a quarter and is way behind their competition - perhaps critically and permanently so? If you say so! I say fix your business first, then sell it - but that's my "when I was a CEO that's how I'd approach it" hat showing up.)

Next up, AXP. The card everyone loves to hate, but is a household word. They beat estimates and had good earnings, but the street doesn't seem to like it at all. Part of the problem here may be that the earnings were significantly improved by a couple of one-time gains. This is one of my losers on the short-term deal I suspect - I took a small nibble on OTM calls this afternoon expecting AXP to beat handily and pop over $60. Oops. Good thing that was a small bet! You can't be right all the time...... but with that said, the aftermakret is improving. Hmmm... maybe a bit of introspection shows that this kind of earnings growth, even if some of it is from one-timers, isn't so bad? I guess we'll find out in the morning.

eBAY also reported. Their report gave investors heartburn - the takeaway was slower organic growth in the United States. eBAY has been particularly aggressive in the last year with fee increases for their auctions, many of which don't look like much but in fact, on a percentage basis, are huge. Perhaps their sellers are finally starting to bite back a bit - if true, IMHO this is long overdue. One of eBAY's larger challenges, especially in higher-ticket items, is the burgeoning "shipping and handling" charged by sellers - this is pretty clearly an attempt by sellers to recover some of those fee increases - if you're a buyer, it looks like you're being robbed.

Finally, the big mover, COF. Capital One. Now despite some of you guys being well-aware that I hate banks in this environment this is one bank I would not have shorted. No way. Among other things these guys are one of the leaders when it comes to being on the ball, and they're also one of the most honestly-run companies out there. In short, these guys are the "anti-bs" to most of the bankers doing loans these days. They are definitely not the "low cost" leader, although their "percent and a half back" deal for one of their credit cards IS a market leader (so long as you don't run a balance - then you're screwed!)

Well, they had a little earnings problem this afternoon. And, in their usual straight-talking fashion, they said exactly what they saw - the mortgage business sucks rocks through a hose. They also said they don't expect it to make them any money any time this year.

And finally, and most important, they actually NAMED ALT-A instead of trying to run that BS "prime" game on investors!

Now that's a breath of fresh air. And its a bit of honesty that I'd love to see out of other companies in this space, instead of cooking the books to make earnings! Just miss already, ok? Tell the truth and go from there. Geezo, is it really all about stock price? Or is it about being straight with your stockholders? I'd FAR rather deal with your stock price blowing up on the truth then coming back in and buying your stock with both hands - knowing that the truth is out, you've come clean, and we can expect the same in the future.

The interesting thing about this is their conference call - they now say they're expecting that they'll be under pressure from volume and margins for the rest of the year. Their view was that they were looking at a cyclical downturn in housing around the start of the year to dramatically weakened market conditions. (Thank you Credit Suisse for that question!) They also expect no earnings from mortgage lending, and highlighted that consumer credit remaining healthy depends on the economy remaining strong.

Their financials actually look reasonable. I didn't detect any tricks. Now granted - I didn't spend hours pouring over them - but I usually spot 'em pretty quickly. They're running reserves ahead of actual losses, and those assumptions look reasonable. Somewhat alarming, their loans held for investment are up significantly, but they fessed to why - the market disruption in the ALT-A space.

In the card and auto area, there is some good news and some bad news. Sequentially, card charge-offs are going up. Autos, however, are going down. On balance, it looks like a wash - so far. On a smoothed basis the card issues look more serious though, as that is a leading indicator of consumer trouble - more so than cars (don't make the car payment, they come get the car!) Its not in the "alarm" category, but it definitely caught my attention.

One thing missing - there is no talk about Pay Option ARMs in the financials, and they did not break out booked back principle. Hmmmm.... More investigation needed here.......


Ok, enough earnings.

On the market in general, we had another day that had no depth. While the DOW was technically up (another "high"), there were twice as many declines in the DOW as there were advances. As I noted in my morning call Asia was down big last night; this evening it appears to have stabilized, but Hang Seng and Shanghi have not yet opened. The dollar has rebounded to a significant degree, but is still well below where it was a couple of days ago.

Then we have some specific stupidity. Cramer shows up on "Stop Trading" and pounds the table on Countrywide, saying that Merrill "should buy them." Now you tell me if this chart is "irrational exuberance" or not?



The stock was in a freefall just before Cramer showed up. Then, suddenly, BOOM! No due diligence, no thought, no rational NOTHING. Just Cramer shooting off his yap on CNBC about something that was carefully-couched to skirt the edge of the law - you can't legally say that something's being discussed if it's not (or if you're just plain making it up!), but you can say "I think X should do Y" - and thousands of people showed up and suddenly hit the BUY button without a second's worth of thought.

This isn't the first time Cramer has pounded the table on this recently. Indeed, this entire week's rise in this stock has, as near as anyone can determine, been driven by nothing more than this sort of rumor and BS play.

Now here's the suspicious part - that buying was met instantaneously with extremely heavy selling. See that volume spike? The pip was immediately sold into bigtime. Were there people who wanted to unload - and who got nervous about the price action - who either knew what was coming or - just perhaps - were primed to be ready? Did some of them jump the gun a bit, which was where the "waterfall" came from in front of it?

When you see this sort of nonsense on a daily basis - and we have - companies that report awful earnings and guidance, yet RISE the next morning - you have to be suspicious that you're seeing a blow-off in the market itself. The market, in short, feels like it's trading on rumor - not fundamentals and not underlying value. That's dangerous - it's the stuff that those "Cold Sweat" 4:00 AM wake-ups are made of..

Tomorrow morning we have yet more earnings coming out, of course, and its also Options Expiration. OpEx is likely to be very lively this time around, with lots of volatility. A number of issues are right near option strikes with extremely large open interests, and with earnings going on at the same time, I expect fireworks, and possibly a big whipsaw one way or the other during the day at some point.

If you've got April Options open and they're in the money, obviously you have to deal with them tomorrow unless you want to be assigned. But beyond that if you're going to trade tomorrow please be careful - I have nothing at this point to indicate that anything really ugly is going to happen tomorrow, but with the dam leaking and plenty of visible cracks, you can't discount the possibility that a good strong gust of wind shows up at an inopportune time.

See 'yall in the morning!