MCM Macro Intraday Trades 1/7/08... 'Just Stocks'

Stocks Discussed: GPS, SHLD, BONT, GIS, HNZ, and SONC...

The MCM Trade is up, and MCM Trend is down... my favorite kind of tape to fade. Selling green, buying red (kind of like Thunder Bay snowmobiling traffic light rules!). The trading wind is whippy out there - keep moving to stay warm.

MCM Trades/Fades
1. sold another 1/3 of The Gap (GPS) this afternoon, into strength, $20.18... MCM Value Thesis remains, but its overowned by some of the wrong people in the hedge fund community right now - apparently the chart started catching people's attention as it was climbing steadily ahead of Christmas. I want to have some dry powder to buy more next time this market cracks, and these momentum long traders bail - this is not a momentum stock and they have no business being exposed to what is a long duration value turnaround investment; we need to wash them out of our system, and buy it back lower.

2. covered all my Sears Holdings (SHLD) this morning, when it cracked, $97.79... I've had my fair share of anti-consensus short ideas in my career, but i have never had so many people tell me i am wrong shorting a stock as i have in the last 9 months in this one. Now that its down from $193/share (its Aprl 2007 nonsensical highs), E-Trade wont even give me a borrow to short it anymore! As the hedge fund crowd rolls in to short it down here, i'm rolling out. Dont expect to see Cramer write the letters S-H-L-D on his knuckles anymore either - that was embarrassing.

3. re-shorted BonTon Stores (BONT) into strength today, $6.84... This remains MCM's top bankruptcy candidate in US Retail. I covered it for a sizable gain last time at $9.49, but clearly that was my mistake. The only thing worse than a PM making a mistake is being too pig headed to learn from it. There are no SEC rules against re-shorting stocks that you cover; if and when the BonTon goes to zero, we'll be there.

4. shorted General Mills (GIS) into strength today, $56.80... Long standing senior management is exiting stage left (the CFO went to Unilever), and the long awaited "Nelson Peltz is going to file on it" hedge fund rumor seems about as likely a near term catalyst as my going to work for another hedge fund anytime soon. We're short BAGL on wheat/grains input costs, and within the gross margin structure of GIS you get to own some of the same optionality, albeit not in as magnified a way. Its a low beta, big cap, "Consumer Staple" stock, so long holders like State Street, Cap Re, and T.Rowe feel safe it in it. Apparently hedge funds havnt done the MCM modelling work i have here, because no one is short this yet (less than 1% of the floating shares are held short).

5. shorted Heinz (HNZ) into strength this afternoon, $46.18... note to follow.

6. shorted Sonic Corp (SONC) into strength this afternoon, $21.99... note to follow.

Thanks in advance for all of your continued research feedback,
KM
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Closed Out Positions (realized gains in green, losses in red)

Long
EWH (bought 20.70, sold 21.35) = +3.1%
BBY (bought 46.60, sold 49.40) = +6.0%
MLHR (bought 26.70 , sold 27.65) = +3.9%
HOG (bought 45.10 , sold 49.96 ) = +10.8%
EAT (bought 21.54, sold 22.44) = +4.2%
EBAY (bought 31.70, sold $34.91) = +10.1%
TOL (bought 22.30 , sold 21.51) = - 3.5%
EWH (bought $22.73. sold 21.98) = - 3.2%
COST (bought 69.67, sold 68.74) = -1.3%
RSX (bought 49.32, sold 51.36) = +4.0%
HOG (bought 48.20, sold 46.55 ) = - 3.4%
KGC (bought 17.33, sold 17.74) = +2.4%
GLD (bought 78.60, sold 82.69) = +5.2%
TIP (bought 104.68, sold 106.64) = +1.9%

Short
RIMM (short 113.90, cover 111.60) = +1.0%
DAVE (short 14.24 , cover 13.60) = +4.5%
DLTR (short 28.51, cover 26.47) = +7.2%
HTZ (short 19.29, cover 18.58 ) = +3.7%
TGT (short 57.93 , cover 59.04 ) = - 1.9%
SPG (short 90.60, cover 94.10) = -3.9%
LIZ (short 25.58, cover 24.19) = +5.4%
BKC (short 26.74 , cover 25.80 ) = +3.5%
EWP (short 68.03, cover 67.47) = -0.82%
HAS (short 27.51 , cover 26.35) = +4.2%
DLTR (short 29.52, cover 28.18 ) = +4.5%
CPB (short 35.62, cover 36.76 ) = -3.2%
IPAR (short 20.48 , cover 16.47) = +19.6%
TLF (short 4.04, cover 3.27) = +19.1%
AN (short 16.99, cover 16.70) = +1.7%
WYN (short 28.19, cover 27.39) = +2.8%
MCD (short 63.35, cover 61.22) = +3.4%
DLTR (short 29.46, cover 27.66 ) = +6.1%
MA (short 219.44, cover 212.72) = +3.1%
SHLD (short $112.51, cover 104.37 ) = +7.2%
BKC (short $28.02, cover 27.70 ) = +1.3%
EWW (short 59.40, cover 55.83) = +6.0%
GE (short 37.60, cover 36.48 ) = +3.0%
JBX (short 28.49, cover 25.74) = +9.6%
BAGL (short $20.15, cover 16.43) = +18.5%
KSS (short 52.64, cover 45.37) = +13.8%
TLF (short 3.25 , cover 3.05) = +6.2%
TGT (short 55.23, cover 49.99) = +9.5%
RIMM (short 103.53, cover 116.98) = - 12.99%
HAS (short 27.15, cover 25.80) = +4.97%
BONT (short 12.26, cover 9.49) = +22.6%
WYN (short 25.01, cover 23.31) = +6.8%
NKE (short 67.01 , cover 64.18) = +4.2%
ATML (short 4.59, cover 4.28) = +6.8%
EWY (short 66.06, cover 61.70) = +6.6%
CAT (short 71.49, cover 70.23) = +1.8%
AN (short 15.49, cover 14.67) = +5.3%
TCO (short 52.73, cover 47.86) = +9.2%
SHLD (short 106.09, cover 97.79) = +7.8%

MCM Disclosure/Disclaimer: This email and/or blog is for a select group of my friends, and represents a beta test of an idea that i am incubating. My email and blog writings are prepared without regard to the unique circumstances or goals of those who read them. They do not provide investment advice that should be specifically acted upon without considering the all encompassing range of investment information and/or considerations available in the public domain and/or without considering all appropriate professional advice. This should not be considered a solicitation to buy or sell any security or to participate in any investment strategy. The information and editorials in these writings are not necessarily complete or perfectly accurate and are not guaranteed by Keith McCullough or MCM. This information is protected from disclosure and constitute opinions only as of the date of their issuance. Opinions are subject to change without notice, and Keith McCullough or MCM do not accept any liability whatsoever for any losses estimated to be attributable to any use of this content. Keith McCullough and/or McCullough Capital Management, Inc. likely owns and/or is currently trading in all of the securities cited in these emails and/or blogs.