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Which Way Wednesday – Topping or Popping?

Happy 14,253!

It's a brand new all-time high for the Dow, which is not, of course, the same Dow as we had in 2007 but let's not sully our victory with facts, right?  

OK, lets:  In Feb 2008, MO and HON were replaced by BAC and CVX, then AIG was replaced by KFT that September and in June, 2009, C and GM were replaced by CSCO and TRV and then KFT was replaced by UNH last September.  

MO was a great drop, it's half of where it was in 2008 (was split off), HON is up 10 points but AIG is down 200, C is up 10 GM is a whole new company so hard to judge now and KFT split up so at least a 190-point drop from the Dow Components that were dropped since we made our highs and that would have cost the Dow at least 1,600 points had they not been ALTERED – more than 10%.  

INDU WEEKLY And what did the new components do for the Dow?  BAC was a poor choice, dropping 30 since 2008 while CVX made up for it with a 33-point move up.  CSCO has gone nowhere but TRV was a 40-point winner since inclusion and UNH is about the same so let's call it 40 points added by new components for 320 Dow points (roughly 8 points per Dollar) but now we're talking about a 1,900-point swing between the old Dow and the New Dow so let's not be too impressed with matching the 2007 high when the deck has been stacked so heavily in the Dow's favor.  

As David Fry notes on his Dow chart, it's all about QE and ZIRP but those are facts and he makes reference to Zero Hedge, who had a table outlining other economic conditions that have changed a lot since the October 2007 high:

  • Dow Jones Industrial Average: Then 14164.5; Now 14164.5

    Regular Gas Price: Then $2.75; Now $3.73

    GDP Growth: Then +2.5%; Now +1.6%

    Americans Unemployed (in Labor Force): Then 6.7 million; Now 13.2 million

    Americans On Food Stamps: Then 26.9 million; Now 47.69 million

    Size of Fed's Balance Sheet: Then $0.89 trillion; Now $3.01 trillion

    US Debt as a Percentage of GDP: Then ~38%; Now 74.2%

    US Deficit (LTM): Then $97 billion; Now $975.6 billion

    Total US Debt Outstanding: Then $9.008 trillion; Now $16.43 trillion

    US Household Debt: Then $13.5 trillion; Now 12.87 trillion

    Labor Force Participation Rate: Then 65.8%; Now 63.6%

    Consumer Confidence: Then 99.5; Now 69.6

    S&P Rating of the US: Then AAA; Now AA+

    VIX: Then 17.5%; Now 14%

    10 Year Treasury Yield: Then 4.64%; Now 1.89%

    EURUSD: Then 1.4145; Now 1.3050

    Gold: Then $748; Now $1583

    NYSE Average LTM Volume (per day): Then 1.3 billion shares; Now 545 million shares

So, lots of changes since the last time the Dow was at 14,000 but, unlike ZH, I'm not sure I think it's all a bad thing.  We have 6.5M more people unemployed and that causes 20M more people to go on food stamps since not everyone works, of course and, as jobs come back, both numbers will begin to improve so that's GOOD news ahead, not bad.  Our Government debt has climbed but Household debt is down and Consumers still are not confident so it's another area that can greatly improve going forward.  

For the first time in 100 years, the US's credit rating can be UPGRADED and clearly, from the price of gold, the Dow has miles to catch up just to begin to reflect inflation.  The low volatility and low volume show that the market in no way is reflecting the irrational buying frenzy of 2007 – so imagine what will happen when the buyers do return.  In the words of Al Jolsen – You ain't seen nothin' yet!  

Of course it's all a huge house of cards and will likely all end in tears but you have to make hay while the sun shines – rather than keep betting on a crash that may not come for quite a while.  I pointed out last week that the reason consumers aren't rolling over and dying with $3.73 gas is because they are using a lot less gas than they did in 2007 so the total amount of Dollars spent on gas is the same.  

When I was a kid, we used to get huge tubs of Bryer's Ice Cream because it was about $1 for the whole family – now Ben and Jerry's is $4 for a pint so we consume less of it.  People adjust their buying habits (within reason) to what they can afford.  

In 2007, we were at full employment and our debt was going up and gas and oil were going up and, let's not forget that a multi-Trillion Dollar bank fraud had yet to be uncovered and THAT is what really derailed the economy – an issue that is papered over by the MSM, who's main sponsors are the very Banks and Energy companies who committed the largest crime in the history of the planet Earth.  

Rather than bitching about the debt and the money-printing and the inflation – we need to realize the economic reality of the situation – there is simply A LOT more money chasing fewer stocks (we lost a bunch of companies in the crash and had few IPOs since) so, OF COURSE, the PRICE (maybe not value) of those stocks is going to go up.  

HOPEFULLY (not a valid investing strategy) all that money will find its way into the broader economy and all those Corporations who are so flushed with cash will begin to spend some of it on hiring and then homes will be built and those homes will be furnished and all those Consumers will stop being 30% less confident than they were in 2007 and will go out and buy cars and washing machines and stuff that will create demand for more stuff that causes more workers to be hired and then the VALUE of the stocks begins to catch up with their price and everyone is happy (except Zero Hedge, of course).  

It may not work out that well and it may not last – but at least let's enjoy the ride while it does…


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  1. 1020

    Good Morning!

  2. stjeanluc

    Oil Lines

    R3 – 92.61
    R2 – 91.89
    R1 – 91.46
    PP – 90.74
    S1 – 90.31
    S2 – 89.59
    S3 – 89.16

    Yesterday's high and low – 91.17 / 90.02

  3. terrapin22

    PSW Investment Conference at Atlantic City Harrah's April 27-29 – We have 11 members signed up and I know there are some members interested in attending but have yet to commit.  If you are on the fence, do yourself a favor and book a room now.  You should be able to cancel the room later at no charge.  Caesars Total Rewards semi-annual sale is going on now thru Sunday March 10th (link below).  Click on Atlantic City – Harrah’s Resort and use the promo code provided (semi13). 
    http://www.totalrewards.com/sale/?ed_rid=3LUFQO-NZLD8-RIL45C-5QDAB9-PUXC2M-v1&ed_mid=11252413

  4. japarikh

    Phil, 
     any AAPL plays with the weeklies to help lower cost of our spread?

  5. jabobeast

    Phil another fantastic article, as usual!!!
    Thank you!
    Also, Loved this from your post yesterday too;
     
    which is why it's simply silly to be bearish at the moment – it's like betting on the tide to go out at 10am when you KNOW high tide is at 2pm – YOU NEED TO WAIT FOR THE RUN TO STOP!
    Just because one wave falls a bit short of the wave before it doesn't mean the entire Ocean is about to violate natural laws and turn back early – no matter how much of a hurry you are in. So imagine you are standing at the beach and you DON'T know when high tide is but you can see that the waves are near their high-water mark (all-time market highs) so it's not really prudent at this point to bet them much higher either. We just have to wait and see what happens at this critical level and THEN, with more information to base our premise on – we can make our new bets.

  6. denlundy

    Phil/BBY. No longer a buyout story, but a turnaround business with potential. Jefferies  puts on buy recommendation.

  7. Burrben

    Tax on selling options?
    Just wondering, but if I sell a option and it expires worthless, with the duration under a year, is it a short term cap gain even though the instrument doesn't exist for a year? 
    (excluding cash settled index's)

  8. phil

    Good morning!

    Dollar creeping up (82.30) so watch that line as it's a spot of trouble.  

    Oil inventories are 10:30 and they are expecting a good draw – 4-5Mb and anything less than that (net) will probably make it hard to hold $90 though they may hang on for nat gas tomorrow as that was a good draw last week in it's been cold.  Still, they are bloated with barrels in the front months and there's a tough roll ahead on the 20th, which is just two weeks from today, because July is already stuffed with 129Mb – about double what a front-month usually has at this stage.  

     

    Click for
    Chart
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Apr'13 90.83 91.17 90.51 90.65 08:16
    Mar 06

    -

    -0.17 19897 90.82 245870 Call Put
    May'13 91.23 91.60 90.98 91.10 08:16
    Mar 06

    -

    -0.18 1964 91.28 192047 Call Put
    Jun'13 91.61 92.01 91.40 91.51 08:16
    Mar 06

    -

    -0.18 2418 91.69 162340 Call Put
    Jul'13 91.98 92.25 91.78 91.81 08:16
    Mar 06

    -

    -0.19 629 92.00 129382 Call Put
    Aug'13 92.04 92.04 91.93 91.94 08:16
    Mar 06

    -

    -0.21 332 92.15 65820 Call Put

    Also coming down the pike, December has a WHOPPING 189Mb already – that's just crazy but won't have a huge effect until it's the 4th month down, in September.  That was caused by people who did year rolls as this December disappointed (under $90) and Dec 2014 barrels are priced at $88.77 so it COSTS $3 x 1,000 per contract to roll this Dec to next Dec and even the NYMEX boys hate to lose $1.8Bn on the holidays so this whole ball of wax may start to fall apart at some point and that, more than anything, is why I liked the Dow shorts for cover (as well as our XOM puts from last week).  

    Keep in mind that any levels can be made for a day – it's day two that gets tricky and day three is nearly impossible to fake so we're hanging out to see what's real and, keep in mind, that AAPL is ready, willing and able to be used as a tool to goose the Nas and the S&P to higher highs – no matter what the rest of the market is doing.  In fact, we've seen that movie before – where an APPL rally is used to mask a broader retreat in the indexes – so be on the lookout for that old trick.  

    You know I love my Beige Book – we get that today but, unfortunately, my Doctor needs me at 3 so I'll be leaving right about when it comes out.  I doubt there will be many surprises – generally improving conditions with lots of worry since we were coming into the sequester when they did that survey.  

     Wednesday's economic calendar:
    7:00 MBA Mortgage Applications
    8:15 ADP Jobs Report
    10:00 Factory Orders
    10:30 EIA Petroleum Inventories
    2:00 PM Fed's Beige Book

    Notable earnings after Wednesday’s close: ALJAMTG,CODIDKDRYSERIINQPETMPNYTCAP

    4:15 AM The DJIA's record close helps boost Asian and European shares, with Japanese and Australian stocks hitting fresh multi-year highs, the latter helped by solid GDP growth. Still, not everyone's convinced. "With the recent gains put largely down to central-bank stimulus and the fundamentals around the global remaining uncertain,heavy skepticism persists ," says trader Jonathan Sudaria. Japan+2.1%, Hong Kong +1%, China +0.9%, India +0.5%, Sydney +0.8%. EU Stoxx 50 +0.5%, London +0.3%, Paris +0.3%, Frankfurt +0.9%, Milan +0.2%, Madrid +0.5%.

    Market preview: The Dow Jones looks poised to build on its record close from yesterday, with DJIA futures rising 0.4%premarket. S&P and Nasdaq futures are also up as the better-than-expected ADP jobs report provides further fuel to today's positive sentiment. However, not everyone's joining in the party, with Staples (-3.4%) becoming unbound following a sluggish earnings report. Later: Beige Book

    New Dow Highs Usually Spur More Buying (WSJ)

    The Latest Prediction of The World’s Wrongest Man (New York)

    Recession:  Eurozone Q4 GDP confirmed at -0.6% Q/Q (second estimate) vs -0.1% in Q3. On year, GDP -0.9% vs -0.6%. For 2012, GDP -0.6%. (PR)

    Merkel’s Working Poor Pose Election-Year Dilemma as Divide Grows. Every Saturday, about a hundred people arrive in a silent procession at a small church in the north of Berlin, armed with empty shopping carts. Some smoke, others play with their children as they wait patiently to be called for the packets of noodles, vegetables and cans of soup that are handed out. They are Germany’s poor, come for out-of-date food that has been collected from supermarkets by the Laib und Seele charity. “It’s scary, nearly every week more people sign up who can’t make ends meet,” Antje Grund, a local coordinator for the charity, said in a Feb. 23 interview while preparing some of the 900 kilograms (2,000 pounds) of food that are doled out each week. “There are pensioners and unemployed, but even people who have a job and a regular income come to us to get food.”

    New York City Leads Jump in HomelessAn average of more than 50,000 people slept each night in New York City's homeless shelters for the first time in January, a record that underscores an unsettling national trend: a rising number of families without permanent housing. Families have become a larger share of the nation's homeless population, growing 1.4% from 2011 to 2012, after their numbers fell as the economy emerged from recession.

    Merkel Looks East for Austerity Allies in Talks With Hollande

    Feb. ADP Jobs Report: +198K vs. +173K consensus, 192K prior  More on ADP jobs: January's job gain is revised higher by 23K jobs to 215K. At 198K in February, job growth has slowed from the previous 3 reads, but is ahead of all the prints from March through October last year. (full report)

    ADP CFO: Companies Accelerated Bonuses at Year-End to Lower TaxesCompanies heavily accelerated bonuses and payroll at the end of last year to avoid higher tax rates on personal income in 2013, a move which could take a bite out of overall wage growth figures this year,

    MBA Mortgage Applications: +14.8% vs. -3.8% last week.  

    More on MBA mortgage applications: Applications reverse previous weeks' slides, with both the Refinance and Purchase Indexes gaining 15% from a week ago. The Purchase Index is up 17% Y/Y. Maybe helping last week was a drop in mortgage rates, with the average 30-year fixed slipping to 3.70 from 3.77%. (full report)

    Buying Treasurys is like "walking in front of a steamroller to pick up $1," Lee Cooperman tells CNBC, putting himself (along with Omaha's Oracle) on the other side of the trade from Jeff Gundlach who said last night he sees good value in the long bond yielding 3.13%. For about the 4th year running, U.S. Treasurys take the title of world's most hated asset class. Other than Gundlach, it's hard to find someone to say a nice word.

    (Likely) incoming BOJ Governor Kuroda is about to "hit (a)wall of reality," says Credit Suisse vice chair and former BOJ member Atsushi Mizuno. He expects Kuroda will try to get creative a la Bernnake, but in the end the bureaucracy will win out and Japan will be left with "an extension of the current policy framework." After the Nov-Jan collapse, the yen (FXY) has been about flat for the last 5 weeks.

    RBS (RBS) should be split up into a healthy and a bad bank, outgoing Bank of England Governor Mervyn King tells a U.K. parliamentary panel, saying that the way the part-nationalization of RBS has been handled has been "a nonsense." The state's ownership "should have been a temporary period," King says. "It has dragged on unnecessarily long."

    MGIC Investment (MTGgains 8.4% premarket after last night's heavily-dilutive capital raise. Investors are clearly focused on the firm's now-renewed growth prospects rather than dilution. The stock has more than doubled from Thursday morning's post-earnings low.

    Good enough:  Hovnanian Enterprises (HOV): Q4 EPS of -$0.08. Revenue of $358.2M. (PR)

    The NINJAs Are Back: Buy Life Insurance, Get A No Doc Mortgage Loan For Free.

    Finally someone agrees with me!  Argus cuts its rating on MasterCard (MA) to Hold from Buy on a valuation call. Shares trade just 1.5% off their 52-week highs with earnings multiples stretched above historic norms.

    Panasonic (PC) is selling an office building in Tokyo for about ¥50B ($537M) as part of its restructuring, with Sumitomo Mitsui Finance & Leasing (SMFG) buying 90% of the rights and Nippon Building Fund the rest. The deal is part of a trend of struggling Japanese companies divesting property to raise funds, including Sony (SNE) selling a building last month for ¥111.1B.

    Australian GDP climbs 3.6% in 2012, representing the strongest growth since 2007 and one of the best performances in the developed world as rising exports and resource investment offset a slump in manufacturing and construction. In Q4, GDP slips to +0.6% Q/Q from +0.7% in Q3 and vs consensus of +0.6%. On year, Q4 GDP stays at 3.1% vs consensus of 3%. The Aussie is +0.3% vs the USD. (PR)

    China plans to issue 4G network licenses by the end of 2013, Industry & Information Technology Minister Miao Wei has said. "China has made breakthroughs in R&D of 4G technologies, but is still facing restrictions in commercial use," Miao said. China Mobile (CHL) has already begun 4G trials in several Chinese cities.

    Traders Flee Asia Hedge Funds as Job Haven Turns Dead EndPaul Smith moved from London to Hong Kong to work in Asia’s hedge-fund industry almost 17 years ago, and he rode the boom to its peak. Last year, like other industry veterans, he quit. “I decided not to wait the cycle out but to do something more productive with my time,” said Smith, 53, who remains in the city heading the Asia-Pacific office of the nonprofit CFA Institute, the global association of chartered financial analysts. “The hedge-fund industry in Asia will continue to struggle to raise funds for the next few years as banks continue to have liquidity issues.”

    Almost time to buy EWZ!  EMERGING MARKETS-Brazilian stocks fall on rates speculation.

    Hugo Chavez's death leaves a big question mark over the country's oil fields, whose capacity has declined due to chronic underinvestment and hostility to foreign firms. "Instability in Venezuela is the real risk, because that could have a dramatic impact on global oil supplies," says Rice University's Mark Jones. Despite Chavez's hostility to the U.S., Venezuela supplies 1M bpd of oil to America out of total production of 2.5M bpd.

    Oil Industry Mulls Next Steps for Venezuela. Venezuelan President Hugo Chavez's death is not likely to result in near-term changes to the Venezuelan oil industry or global energy landscape, but it could ultimately result in political change that would reopen the country's energy industry to foreign investment.

    Petrobras (PBR+9.3% premarket after announcing it israising the wholesale price of diesel fuel 5%, a move aimed at cutting losses from selling fuel at prices below world-market levels. Diesel is Brazil's most-used motor fuel, powering most of the country's trucks, railway locomotives and heavy machinery

    Peabody Energy (BTUsees Q1 adjusted per-share loss of $0.04-$0.26 vs. analyst consensus of -$0.15, but expects an increase in earnings after Q1 on growing Australian volumes and price. Sets a 2013 capex target of $450M-$550M, ~50% below 2012. Says 2013 coal markets show early signs of a rebound, as emerging markets drive significant near- and long-term met and thermal coal demand growth.

  9. phil


    Raymond James is getting less negative on solar.  SunPower (
    SPWR), First Solar (FSLR), Trina (TSL), and Suntech (STP) have all been upgraded to Market Perform. It might've been wiser to make this call in November.  SPWR +3.3%FSLR +2.8%.TSL +1%STP +1.7% in spite of its boardroom drama.

    Paulson's Gold Fund Limps Forward. Gold is up 70 percent since hedge-fund manager John Paulson turned bullish in the spring of 2009. So why has Paulson & Co.'s dedicated gold fund suffered double digit declines?

    Copper Market Prepares for a FloodPrice of the Industrial Metal Has Plunged Amid Forecasts of the Biggest Increase in Output in 13 Years. The copper market is bracing for a wave of new mine openings this year. Copper prices recently fell to three-month lows as investors and traders anticipate an onslaught of supplies, estimated to be the biggest increase in global copper mine output in 13 years. At the same time, the outlook for growth in copper demand remains dim: The No. 2 and No. 3 users of the industrial metal, Europe and the U.S., continue to face economic headwinds.

    Rubber Trades Near Two-Month Low on Demand Outlook Concerns.

    Citadel increased its stake in Buffalo Wild Wings (BWLD) to 5.15%, adding over 700K shares from its previous position. (13G)

    Oppenheimer starts coverage on FedEx (FDX) and UPS (UPS) with an Outperform rating. The two companies are in the thick of the battle between Amazon, Google, Wal-Mart and other major retailers to solve the riddle of providing same-day delivery. So far, nothing dramatic has changed the landscape for FDX and UPS. - I think they should skip that step and just start delivering things I MIGHT want before I even know I need them.  

    Honeywell (HON), which generated 11% of its revenue from the U.S. government in 2012, expects its defense business to dip slightly in 2013, but it doesn't believe sequestration will have a big effect. "We anticipated and planned for some level and some period of sequestration," says CFO David Anderson. Still, Honeywell intends to continue to slow down its hiring, due to the uncertainty surrounding the economy

    Staples (SPLS): Q4 EPS of $0.46 beats by $0.01. Revenue of $6.57B misses by $150M. (PR)  More on Staples' (SPLS) Q4: Sales excluding the 53rd week in 2012 fell 3.8% Y/Y as comparable store sales were 5% lower. Online sales rose 7% with the company increasing its investment in the online business. The retailer expects 2013 sales to increase at a low single-digits rate and EPS to fall in a range of $1.30 to $1.35. (PR)

    After a sluggish earning report (III), Staples (SPLS) is giving back some of the gains it churned after the Office Depot-OfficeMax merger announcement tipped sentiment positive in the sector. Analysts are quick to note comparable-store sales for the retail look "awful" with U.S. comps down 5% and overseas falling 9%. SPLS -5.3% premarket.

    Jefferies upgrades Best Buy (BBY) to Buy with an improved price target of $24. The firm says new Best Buy management will succeed in cutting costs and improve its online business. In addition, sales of Europe and China operations could fetch as much as $600M to $900M. BBY +1.2% premarket to $18.61.

    The last of the bulls retreat as both Oppenheimer and JPMorgan move off their Buy rating of J.C. Penney (JCP). Yesterday's late report that JCP directors are considering drastic action with the retailer and its embattled CEO is also hanging in the wind. JCP -1.6%premarket to $14.60.

    Finding room for margins to grow at Wal-Mart (WMT): The retailer highlighted its plans to shift its mix to a higher percentage of small-format stores during an investor conference yesterday (recap). Though CEO Bill Simon made it clear supercenters are still part of the growth plan, the ramp up in Neighborhood Market and Express locations could help boost the company's competitive advantage against drugstores and grocery stores as well as provide new channels for its online business.

    Dell's (DELL) special committee of independent directors finds, after over five months of analysis, that "the sale of the company would be the best alternative for stockholders." The panel "negotiated aggressively" to agree a buyout offer of $13.65/share from Michael Dell and P-E firms. Meanwhile, the go-shop process will continue until the scheduled end of March 22. (PR)

    News Corp.'s (NWS) education unit Amplify is today set to showcase the first tablet computer designed specifically for schools. Amplify reckons education boards will spend hundreds of dollars per pupil on such devices despite steep budget cuts. The company is also entering a crowded market that includes the iPad and Pearson.  News Corp. (NWS) says its education unit will launch a $299 Android-based tablet designed for students. The tablet will hit the market in time for the 2013-2014 school year in the U.S. 

    The European Commission has fined Microsoft (MSFT) €561M for taking too long to fulfill its commitment to a 2009 settlement to provide consumers with a choice of Internet browsers in its Windows OS. The penalty brings total EU fines for Microsoft over the past decade to €2.26B. Google (GOOG), which is under an EU investigation for possible abuse of its search dominance, may well be watching with interest. (PR) 

    Foxconn has begun production of an iPhone 5S (AAPL) that looks much like the iPhone 5, claims Japanese blog MacOtakara, which has a mixed track record (III) with iScoops. MacOtakara also reports NTT DoCoMo (DCM) has slashed Android phone orders for the fall, which is fueling speculation an iPhone deal is on the way. Jefferies' Peter Misek argued last month preparation for March iPhone 5S production could be responsible for new iPhone order cuts. Possible/likely suppliers: CRUSOVTISWKSTQNTAVGOQCOM,BRCMNTEMFLXLPL. (yesterday)

    Apple’s Reality Distortion Field Relocates to Wall Street (Time)

    The U.S. has made little progress in ensuring that money for infrastructure projects during future military operations won't be wasted, an audit from the special inspector general for Iraq reconstruction reportedly says. Various studies have found that billions of dollars were misspent in Iraq and Afghanistan, with U.S. money even being diverted to fund insurgents.  - I love the WSJ, Bush wastes money, fraud is uncovered by Democratic Committee but they manage to make it sound like Obama's fault.  

    Dear American: It's An "Extraordinary Circumstance" And This Drone's Coming For You.

    U.S. Has 7th Highest Cancer Rate in the World (WebMD)

    Three breakfast reads: 

    1) SA Pro: Boston Beer: Buy The Beer, Sell The Stock 

    2) Nokia Is Connecting The Next Billion People 

    3) Comcast Is Entering The Wonderful World Of Disney

  10. eric_s

    Pharm
    Thank you for the info on EXEL. I'm reviewing a few quarterly reports and other pieces of information. 
    Do you have any insights or perspective on ANIK (Anika Therapeutics, Inc.)? They develop and manufacture products for tissue protection, healing and repair. They appear to be consistently profitable and cash flow positive. Although I believe they are having some FDA approval issues of late, hence the weak stock performance. Any insights would be appreciated. Thank you.

  11. jromeha

    Hey pharm- how high do you see Aveo popping before FDA meeting in May? I think the April 5/7.5 bull call spread for 1.45 looks pretty safe…. 

  12. stjeanluc

    Selling FAS calls is like trying to stem the rising tide now…

  13. 1020

    Phil – In order to be more politically correct – I'd like to suggest replacing 'Idiot' with 'Boskin'….
     
    ….while I realize this may be difficult for some, all one needs to do is to read the above article to see that being called 'Boskin' is much worse than the alternative…. :)
    http://nymag.com/daily/intelligencer/2013/03/worlds-wrongest-man-ventures-latest-prediction.html

  14. stjeanluc

  15. stjeanluc

  16. stjeanluc

  17. phil

    Dollar over 80.30 and oil below $90.50 not helping the rally.  

    AAPL touched yesterday's $435 high again and started a selling frenzy so we'll have to get rid of that guy before we can move higher.  

    AC/Terra – Thanks, I actually haven't booked yet (too busy with cruise this month) so I'll do mine today.

    AAPL/Japar – Would have been nice to catch that morning pop but gone already.  We'll see if $430 holds and consider next move.  

    Thanks Jabob – that is a pretty good quote…  ;)

    BBY/Den – I've been liking them buyout or no and that's why we didn't close them in old Income Portfolio ahead of earnings.  At this point, they are no longer a bargain though so not something I'm interested in as a new entry.  Once I'm spoiled like we were with BBY at $12, it's hard to get excited about buying them at $18+ a few months later.

    9:31 AM At the open: Dow +0.33% to 14301. S&P +0.33% to 1545. Nasdaq +0.13% to 3228.
    Treasurys: 30-year -0.5%. 10-yr -0.23%. 5-yr -0.1%.
    Commodities: Crude -0.47% to $90.39. Gold -0.15% to $1572.5.
    Currencies: Euro -0.24% vs. dollar. Yen +0.26%. Pound +0.34%.

    Safeway (SWY +0.5%issues guidance ahead of an investor conference scheduled for today. For 2013, the company sees EPS of $2.25-$2.45 vs. $2.24 consensus and free cash flow of $850M-$950M. (webcast)

    Prana Biotechnology (PRANsurges 17% after saying that its PBT434 treatment for Parkinson's Disease helped bring "marked improvements in motor function and coordination" in three animal models. PBT434 lowers the accumulation of a key protein called alpha-synuclein, which damages the nerve cells of the substantia nigra part of the part of the brain, where movement is controlled. (PR) (SeePBT2 trial)

    Facebook's (FB) Thursday news feed event will feature the launch of photo and music-specific feeds, TechCrunch reports. Larger news feed photos and image-based ads are also said to be in the cards, but a major revamp of the mobile feed (as TC had previously speculated) isn't. The report comes as sales of Facebook'sSponsored Stories news feed ads surge, and the company talks of making sure media content is "honored and respected" within feeds.

    Wow, big attack on AAPL this morning:  More on Apple: Berenberg's Adnaan Ahmad has downgraded shares to Sell from Buy, while also cutting his rating on Samsung (SSNLF.PK). With smartphone growth now fueled by emerging markets, "Apple and Samsung margins are peaking and growth is going to be driven by the margin-dilutive mid-to-low-end segment," he argues. Also, Citi has cut its PT to $400, citing weaker iPhone 5 and regular iPad demand. Citi, which cut Apple to Neutral in December, now expects March and June quarter iPhone sales of 34M and 25M, below a consensus of 37M and 32M. AAPL -0.2%.

    So, knowing that AAPL is down on C downgrade (no one cares about Berenberg), it's more a matter of seeing if anyone cares anymore or if we have finally gotten rid of all the sellers.   

    Oil testing $90, gold smacked down to $1,567 as Dollar hits 82.33 but we saw that coming a mile away so no biggie.

    Silver $28.55, Copper $3.4955, Nas gas $3.52, gasoline $3.13. – So we have a Dollar-driven sell-off which we are, of course, trained to ignore, right?    

    Boskin/1020 – Well, what do you expect from Bush's economic adviser?  And from the Hoover institute, no less!  

    PCLN loving news of Cook laying people off (Cooks used to be THE place to book in Europe):

    U.K. travel firm Thomas Cook says it will cut 2.5K jobs and close 195 stores in Britain as part of its restructuring. The company continues to struggle after the downward turn of the global travel business and with online rivals taking market share.

  18. newt

    WFR/ Phil et al: I have a buy/ write as follows— Long WFR with Jan14 $3 calls and Jan14 $3 puts against it.  For the calls I collected .74- they are now 2.53.  Stock was bought at 2.63 and is now 5.13-- What is the best way to manage a position like this? I am thinking to roll out the caller….

  19. Pharmboy

    ANIK/eric – don't know much about tissue repair, as it is not my area of expertise.  Seems that they do make nice change, but with any manufacturing process of this sort, it is imperative that the 'goodies' be clean.  Looks to me that they may be a nice target for a smith and nephew.  Sorry I can't be of more help.

     

    AVEO- why not just go with the Apr $5 calls coupled with the sale of the $7.5 Puts.  The $7.5 calls are not worth the hassle as they are not doing much with reducing the risk….IMHO.  Volatility is going to start picking up as well.

  20. stjeanluc

    Phil – The GOOG April BCS is now at 87% of max value with 44 days to go. Should we look at reallocating that margin to something more aggressive?

  21. stjeanluc

    On the bright side GOOG is catching a breather… On the less bright side, AAPL's breather is extending another day!

  22. wombat

    Morning guys //
    Got a HOV fill Jan15 $5 PUTS @1.25

  23. stjeanluc

    And we are fighting over $85B of spending cuts:

    Overall, including all military and diplomatic costs and other aid, the U.S. has spent at least $767 billion since the American-led invasion, according to the Congressional Budget Office. National Priorities Project, a U.S. research group that analyzes federal data, estimated the cost at $811 billion, noting that some funds are still being spent on ongoing projects.

    Yeah, that was worth it!

  24. mjjwo9b

    Phil, appreciate your thoughts on the following position:  I've got a few hundred shares of KMB at a basis of $47.  I'm short a 2014 $80 Call and $70 Put.  I'd like to redeploy the money to more profitable trades as this one is all but out of gas.  

  25. phil

    TLT $117 getting interesting again with note sales next week.  

    FAS Money – We can roll the 5 weekly $151.50 calls ($7.75, $3,875) to 6 March $155s ($6, $3,600), which is a pretty cheap way to gain $3.50 in strike.  The $121 short puts are pointless so let's buy those back and hope for a dip opportunity to sell something else (April $131 puts are now $1.65 and $2+ would be nice for 5).  

    AAPL Money – Still waiting for $400 so we can cover and roll lower.  If we sell the Jan $450 calls for $35 to some sucker who thinks AAPL may actually go UP over the course of a year, we can take that money and roll our 2015 $400 calls ($77) down to the $330 calls ($116) for $39 so net $4 to gain $70 in strike and cap our gain at $120 plus whatever we can roll the caller for (the 2015 $520s are $35 at the moment.  Obviously, I'd rather not but it's good to have a plan, right?  

    Meanwhile, SQQQ $36 is not happening so we can roll the short April $40 callers to the April $34 callers for + $1.20 and use that $1.20 to roll our $36 calls to the $30 calls ($4) for $2.80 so we spend net $1.60 to drop our $1.10 spread $3.88 in the money and, of course, we can always roll back in time if the Nas goes higher but we're locking in $1.20 of gains ($2,400) if the Nas fails to go higher.  

    $25KPM – I love a portfolio that doesn't move.  Perfect balance in a portfolio is like getting a sculpture right – you have to know when to stop touching it!  Once you get balance, it's more like surfing and you can just tilt it in the direction you want to go and it obeys you.  Same adjustment for SQQQ and it looks like we might be rolling IBM callers, but so what?  We like IBM, don't we?  On TZA, we didn't get the sell-off we were worried about today so we'll be taking that loss and moving on unless something strange happens.  

    • $25KPA – Lot's of stuff so let's make sure we have a plan:
    • AAPL – See AAPL Money above – same(ish) sort of thing if AAPL doesn't get it in gear. 
    • SQQQ – Same adjustment
    • GOOG – Ow, my brain!  Gotta lay this one out.  We have 3 April $740s and 6 Jan $700s and 3 2015 $800s and they are all nicely in the money so they can't possibly be our problem.   We shorted 3 April $770s and 6 Jan $800s and 3 2015 $900s so it must be the April $770s we're worried about, right?  Do we think GOOG fails $800 by April?  Not really.  Do we think GOOG goes over $900, from $550 lows last year ($350, 63%) without a 20% pullback to $830?  Not really.  So, let's take the money and run on our 3 April $740s ($98 = $29,400) and buy 6 more of those really cool 2015 $800/900 spreads for $48 = 28,800) so we drop $600 in our pocket there and now we WANT to be covered by callers and, conveniently, we've already collected $22.20 from 3 April $770 callers and we can roll those suckers (now $71, $21,300) to 5 of the May $820s at $40.50 ($20,250) for $1,050 and we still have the $6,660 we collected from those callers and our long spread gives us another $80 of upside before we're really in trouble – we can live with that…
    • IBM – Waiting and seeing.
    • VMW – Getting better
    • FB – Also getting better, happy to roll the March putters if we have to but already $28 today. 
    • EXPE – Should be as happy as PCLN today but they're not so our theory that they are too pooped to pop at $65 is holding up so far.  
    • AKAM having a good time but watch the 50 dma at $39 for resistance that may not be futile. 
    • TZA – As noted above. 

    Oil inventories not enough to hold $90 (as expected) but now we have to watch out for falling energy sector dragging down our indexes – thank goodness for XOM puts!  

    EIA Petroleum Inventories: Crude +3.8M barrels vs. consensus of -0.2M. Gasoline -0.6M barrels vs. consensus of -0.3M. Distillates -3.8M barrels vs. consensus of -1.3M.

    Nice draw on distillates but that's heating oil and jet fuel – gasoline is huge disappointment for the energy sector.  

  26. qcmike

    Pharm
     
    TSRX  moving up,  did you take a position   ?  

  27. phil

    WFR/Newt – So you have a buy/write that netted about (as you didn't tell me the put price) $1/1.50 with a call-away at $3 for a $2 profit and that is your bird in the hand with WFR now at $5.22.  Assuming that's a 1x position you'd be happy to DD, then I'd roll the Jan $3 puts (.30) to the 2015 $4 puts ($1.10) for another .80 and flip the stock ($5.21) to 2x the 2015 $2.50 call $3.10) and roll the short Jan $3 callers ($2.53) to 2x the Jan 4.50 calls ($1.53) for another .50 in pocket so the overall re-position is net free and now you have 2x the $1.50 spreads (with $3 max upside vs $2 on current) and you risk an assignment at net $5 (as you put in $1 originally) with a break-even at $3.75 but still 1x so plenty of room to roll.  Or you can just take your $2 (200%) and wait until next time there's a good dip to buy WFR again (or the next bargain).

    HOV/Wombat – Nice entry.  

    War/StJ – Yep, there's 10 years of Sequestration right there.  Also, keep in mind the bloated military is FROM the war and keeping that level of spending AFTER the war is STUPID.  What's the new rule – if we start spending money for military action we then have to keep spending at least that much forever – no matter how much the situation changes?  Ike tried to warn us:  

  28. Savi

    Phil—on Goog adj don't we have short 3 june 700s and short 6 march 750's also

  29. denlundy

    BBY/Phil. Agree on no new entry, but was looking for some guidance on tending to the BBY TREE I have planted.
    Have 1,200 shares @ $15.92
    Sold 3 Jan 14 puts $15@ $2.90
    sold 13 Jan 14 puts $18 @ $2.94
    bought 15 Jan 15 calls $13@ $3.95
    My question is your thoughts for holding pat to see if management can turn this ship around and move stock from $20 to $30 range?

  30. rexx

    JCP – time to bottom fish?  Or is it a lobster trap? Ron Johnson's not gonna last much longer.

  31. jabobeast

    AAPL is so frustrating… I can't believe the market keeps flying while AAPL will not participate. I agree with Phil's outlook and research. Fundamentally, it looks like a super value. Still, it trades like a POS (for now). Phil always teaches that you shouldn't short a put in a company you don't want to own. Great advice. I just am shocked that value guys don't see this like we do and haven't been scooping up shares down at these levels. Why would someone buy PCLN, AMZN, CMG, and all the other MoMos and think AAPL is dead money?

  32. stjeanluc

    JCP / Rexx – Knowing the yahoo's in the market, the stock will jump when Ron Johnson decides to leave for family reasons with a $50M thank you package but that's a mighty ship to turn around! Not something I would add to a long term portfolio.

  33. Pharmboy

    TSRX – take a position….we have a position….

  34. newt

    WFR/ Phil: Sweet move.  So i understand it in its entirety: my long Jan15 $2.5 call provides upside protection b/c the short call expires in Jan14 so I can continue and / or adjust the sale of callers as the stock moves up.

  35. Jbur

    FCX: Looks like someone has started an accumulation plan on one of my favorites.

  36. qcmike

    Pharm
     
    thanks

  37. 1020

    Pharm – ZLCS reported. Any thoughts?
    http://finance.yahoo.com/news/zalicus-reports-financial-results-fourth-123000585.html

  38. 1020

    Phil – Picked up a few shares of an old favorite. OPTT
    http://finance.yahoo.com/q?s=optt&ql=1

  39. scottmi

    XOM/Phil – can you reiterate the premise for XOM puts and why out at July? Are these general market 'insurance' or specific for an oil price correction?

  40. wombat

    jabo // AAPL
    i hear ya. I opened the new position Phil reco'd in another port but i'm still standing firm on the 'one trade'. would be happy to own AAPL at $360

  41. Opesbridge

    Phil/FAS – We still have the short March 150 calls sold for $5.15  (a small sale, less than a 1/4). Now that XLF is holding 18, should these be rolled as well?

  42. hemas03

    Stj/All
    Re:  "retired" or "old" Income portfolio:
    FWIW,  filled CHL Jan15 45P STO @ $3.30 this morning, target was $3.50 on Feb 7, 2013.

  43. albo

    SD -I've put on a long term position over the past few weeks  which might be of interest to some.  Bought Jan 15 $3 calls for ~3.  Sold Jan 15 $5 puts for ~1.50 & sold September $6 calls for ~.80.  Big positions in SD are held by Prem Watsa of Fairfax Financial, Leon Cooperman, and TPG-Axon.  Both Cooperman and TPG have recently added to their positions, and TPG is waging a proxy fight.  Could be interesting.  Good premiums on the options.

  44. stjeanluc

    Boskins / Phil – Barry is piling on:

    http://www.ritholtz.com/blog/2013/03/michael-boskin-wrongstradamus/

    It's a wonder this guy doesn't show up often on CNBC. He would be right at home there!

     

    In the new radical right movement, being consistently wrong is some kind of a badge of honor, and so he rose through its ranks, failing upwards as an economist, but scoring points as a propagandist. As a former George W. Bush economic adviser, we expect him to have made bad decisions, as that was seemingly a requirement for any job in that worst of all administrations. As a fellow at the Hoover Institute, we expect him to continue pursuing the brilliant policies that made President Hoover such an economic success story. (Note its called the “Hoover Institute” because the name “Clusterfuck Foundation” was already taken).

    But all of that is just so much political bullshit. What is most unforgivable, is that he sandbagged investors for political reasons. Anyone who listened to the advice of this ‘respected economist,’ wrapped in the language of investing (but in actuality partisan political tripe) was crushed.

    That is the real reason you should ignore anything and everything Boskin writes or says — because he is so contemptuous of you as an investor that he is willing to throw you under the bus in pursuit of his own radical right ideology.

    You see, it was never Boskin’s intentions to give you investing advice — indeed, from all appearances, he could not care less about that. His agenda was an attempt to scare you politically. That he did so in financial papers like the Wall Street Journal or Investor’s Business Daily simply reveals the contempt he (and their OpEd managers) hold for their readers — saps, marks, subscribers, investors — suckers all.

    Right in there with Kudlow, Laffer and all these morons!

  45. 1020

    Boskins!!  All of them!  

  46. phil

    Oh, here's a good video (because it uses cool clips) of the Human March Towards Slavery – makes a lot of good points.  

    KMB/Mjj – Look toppy to me and I agree with your take on it.  You can trade the stock ($95) for the 2015 $77.50 calls for $19 (net $96.50) and take $76 off the table, almost as much as you would be called away for.  The Jan $80 callers are $16 and the Jan $70 putter is $1 and you can roll the caller to the 2015 $85 caller at $12.70 (net -$3.30) and sell the 2015 $77.50 puts for $4.50 so you net about zero into the $77.50/85 bull call spread with the short $77.50 puts and your worst case is being assigned back the stock at net $77.50 (20% off current) and your upside is another $7.50 plus the $29 you're already walking away with.  Of course, you can always just go for the $4 profit on the bull spread and save selling puts for IF there is a dip – if there's no dip, then it's an easy +$4 with no margin anyway.  

    GOOG/$25KP, Savi – Oh the box confused me as it didn't cover the first two positions.  Overall then, we have:  

    • 6 short March $750 calls 
    • 3 April $740/770 bull call spreads 
    • 3 short June $700 calls
    • 6 Jan $700/800 bull call spreads 
    • 3 2015 $800/900 bull call spreads.  

    We talked about fixing the April bull call spread but the March $750 short calls still need to be addressed.  We sold them for $45 and they are now $80 so we're down $35 and we want to at least roll our loss so that takes us to the April $815s, now $37 and that's fine for now, no need to add more and we can sell 3 April $775 puts for $10.20 as that gives us $5 per long to roll next time and we're very happy to DD on those puts (as we're still very long) if GOOG sells off a bit as they'll be easy to roll while we wait for all these short calls to expire.  

    BBY/Den – You are a greedy bastard!  The 2015 $15 calls are $5.35 so up 35% there and not even a spread or anything hedging.  The short Jan $18 puts are still there and you should just be thrilled if they expire worthless for another $3,900 gain.  I mean really, what's the question – it's raining money and you want to know if there's a tree you can shake to get wetter?  Retail is a tough business – I loved them at $15 and $12 but at $20 – it's just a retail store that needs to execute vs. a company with a brand and presence that was worth more than it's price for a while.  I'd cash the stock and cash the $15 calls and cash the Jan $15 puts and leave the short $18 puts, which are rollable and, if you want to gamble they zoom over $20 (I doubt it) you can buy the 2015 $22 calls for $1.65, which is net zero against the short calls so anything over $18 is a win anyway and you get bonus money on any move over $22 – what's so bad about that? 

    Wow, these sell-offs are so lame – poor bears!  

    JCP/Rexx – You guys are like dogs with bones.  They had a run, the story came and went.  You'll fool less people next time around – if there is a next time at all.  Their forward p/e is zero.  Their current p/e is zero.  Why is that?  BECAUSE THEY LOSE MONEY!  Last year they lost $3.50 a share and this year – if all goes well, they will lose $1.50 a share and next year – if things really get going – they PLAN to lose .50 per share.  

    Now – your decision to give JCP your $14.50 to hold so they can lose $2 over the next two years is based on what?  That you feel other people will choose to give JCP MORE money to hold while they lose $2???  

    Perhaps in a vacuum, where JCP were the only stock on Earth, you might want to take that gamble but BBY, by comparison, is a retailer too and they are about the same price at $18.95 but, strangely, they MADE $2.62 per share last year and this year, despite their troubles, they will make about $2.12 and about the same next year.  

    So, what you are really saying is you expect people to rather pay $14.50 so JCP can LOSE $2 against it over the next two years than give $18.95 to BBY, who will MAKE $4.25 per share over the same period.  These are the kind of things you need to look at BEFORE you read the gossip pages about who's the new CEO and how pretty the aisles are going to be, etc.  Stocks are businesses and you are buying the business – it's a very small piece of the business but you are buying it just the same and you need to start looking at your investments as investments – not bets.  

    Value guys/Jabob – Actually 20M shares of AAPL are bought every day.  It's just that there are 1Bn shares so it takes 200 days for all the "non-value guys" to get out and AAPL has only been selling for 100 trading days so far.  AAPL is transitioning from growth to value and that's a big changing of the guard from an investor standpoint.  With $156Bn in sales, AAPL is 2.5x bigger than AMZN and about 20% of AMZN's sales are AAPL anyway.  WMT only sells $450Bn worth of stuff in a year and that's 3x AAPL and it's very hard for people to believe AAPL can sustain margins when people like WMT and AMZN and even HPQ ($120Bn) or DELL ($62Bn) can't.  Of course, 30 years later those companies only exist because IBM didn't see any profit at the time in selling "micro computers" to consumers, right? 

    WFR/Newt – Exactly. 

    FCX/Jbur – They are having trouble keeping copper below $3.50 at this point, even with Dollar flying to 82.50 today.

    By the way, Dollar testing 82.50 after EU close so markets are holding up great, considering.  

  47. kevinb63v

    Phil,
    What do you think of PWE? It's been beaten down 50% to $9.82, but pays a dividend of close to 11%. Cramer is bearish on it, so that's a big plus. I was looking at a b/w at $9.82, selling the Sep $9 puts/calls for $1.75 for a net $8.07/8.54, making the dividend about 13% and a 13% discount if put. They are mostly NGL production at this point from what I read.

  48. wombat

    got my CHL fill @ $3.50 //

  49. wombat

    Phil // Q
    Is it considered good practice to use trailing stops on a stock combined with covered calls ?

  50. Burrben

    Yodi / QCOM
    I got filled on 10 of the 
    short Jan15 60P's, long Jan15 57.5/70 bull call for a credit of 0.75c.
    What was the credit you got yesterday?

  51. newt

    WFR/ Phil: Thanks  – 3000 hours in…

  52. ariveraA

    Phil: Think you'll appreciate
    http://www.thedailyshow.com/watch/tue-march-5-2013/we-re-rich--bitch-

  53. yodi

    Option play on TAL
    buy stk @ 43.21
    Sell Oct strangle 45/35 for 4.15
    stock has a yield of 5.9%

  54. angelcur

    http://www.reuters.com/article/2013/03/06/china-ironore-idUSB9E8LA02N20130306
     china blaming someone for manipulating commodity prices…hahahahaha
    nikkei pe up to 26…from 19 in Nov…will be interesting to see if their economies accelerates like everyone thinks
     china making lots of hawkish statements last night/today about housin

  55. stjeanluc

    QCOM / Burrben – Waiting was actually OK for a better entry since frakin' Goldman removed them from their Conviction list!

  56. dawnr

    FCX… is way up on news out of China early morning that says they will buy more copper from FCX. I am scratching my head on this one now on direction as $DXY up you would expect commodities to be down.  Looking to see if this is just a temporary spike that continues the down trend.  I have been playing this one long from $31 but took my money and ran…
    (still have the 2015 FCX puts in Roth)

  57. Gingbaum

    Phil
     
    Would you recomTmend a SPLS option play for Jan 14?
    Thanks

  58. wombat

    for Jabo //
    FU AAPL !!!!!!!!!

  59. phil

    OPTT/1020 – My local boys!  I must have told you this whole thing was my idea from many years ago, right?  

    XOM/Scott – See the post it was written in.  July was just a good risk/reward spot and, as noted this morning, July has a bloated amount of open orders so we expect things to hit the fan by then.  XOM is a stock we don't expect to burn us higher and has several reasons to go lower so good overall insurance.

    FAS/Opes – 1/4 is not so small as you have just a 1/3 normal ratio.  See above FAS Money play, it's the same thing.  With XLF at $18, which we don't think will be broken into expiration, FAS is $157.15 so rolling to an equal amount (net $$$) of March $155s (now $5) gives us the expectation they should wear down to $2 if XLF stays at $18 or lower and we'll get 60% of our money back if all goes well.  If not – then we move to the Rawhide Strategy (rollin', rollin', rollin').  

    SD/Albo – I'm not wild about Nat gas these days – too much of it around.  They are all counting on LNG to save them but we're not the only country itching to export cheap nat gas on tankers.  If they start using it in cars, that would be nice but I think by the time they get a nat gas infrastructure in place – electric will be improved enough that nat gas cars will seem silly (but trucks might still work).  

    LOL StJ – Barry puts it well.  It always does amaze me that the 2nd most important Republican Think Tank is still called the Hoover Institute as if saying it often enough will remove the stigma.

    PWE/Kevin – More nat gas (see above).  In fact, nat gas is killing them so they are "brilliantly" switching to coal and their investors (coupon clippers) are bailing as it's a big investment and may cut the dividend down the road.  As far as I know, they haven't done earnings yet so dicey under $10 but you can just sell the Sept $9 puts for .80 in lieu of the $1 dividend (only .75 by then anyway) and see if you just net in 1x for net $8.20 rather than risk a 2x assignment as you can always buy the stock and sell $10 calls for about $1 if it breaks over $10 on good news.

    CHL/Wombat – Very nice.  They are the AT&T of China – a nice forever hold.  

    82.53!

    Good practice/Wombat – As always, it depends on the stock, the price, the environment, etc.  Stops very often tend to be discovered and triggered by bots as they spike things around when things go against you.  AAPL, for example, opened at $418.32 yesterday, before zooming to $435 and this morning they opened and hit $435 before falling to $427 so stops of bulls and bears were both thrown out and we're dead center after all that nonsense.  Best rule of thumb, if you want one – is STOP OVERTRADING!  Pick a position and stick with it.  If you want to day trade each little move something makes – then make day trades, but don't turn every spread you have into a day trade – it's just not worth it because you are just not that good of a trader (and neither are any of us, but at least we know it).  

    You're welcome Newt.  

    Football/Angel – I am instituting a policy where I will charge people $1 for each commercial I am forced to view unless the video is totally worth it.  I guess this one is funny if you are a Conservative misogynist but they fail to mention she had an injured leg and limped off the field straight for the medics:

     

    The 28-year-old Silberman said she hurt her quadriceps while preparing for the tryout earlier in the week, and attributed her struggles to that.

    "I tried staying off it and waited for today," she said. "I didn't even take kicks in warm-ups, and, it's pretty hard to know that you'll be in pain, and I wanted to work through it and I certainly tried to, but I just couldn't do it today."

    Meanwhile, Ashley Martin is a more legitimate candidate who plays Division 1 at Jacksonville.  

  60. dawnr

    BTW on $DXY if the current level breaks, my school called out the next quality level of 83.20-83.40.  This is also an important FIB zone (78.6%0-83.6%). Fresh demand at 81.40…

  61. yodi

    Phil how about an other INTC play last one worked very well

  62. newt

    WYNN/ Yodi: Lookin good.

  63. angelcur

    I think is you charged a buck for inanity as well you would have a pretty sweet cash flow going..meanwhile back to the planet earth
    http://www.efxnews.com/story/17636/italy-too-big-ignore-needs-eur-fall-119-make-good-recovery-morgan-stanley OlympusCM [12:50 P.M.]:  its
    amazing that price target lowering on aapl still seems to effect the stock…barclays lowered to $530
     i have my hedges on it off now, but if it takes out 420 they are going right back on

  64. 1020

    Ocean power tech / Seals on bouy catching rays / Fullfilling Phils dreams    :)

  65. phil

    Daily show/Arivera – I always appreciate them.  

    TAL/Yodi – Nice little business. 

    China/Angel – I think they are just trying to jawbone everything down.  Top 1% getting out of control over there, threatening Party.  

    FCX/Dawn – Copper is in a nice, slowly-rising channel at this point.  $3.50 should hold and that's better than $3.25 last year when FCX bottomed at $30 so makes good sense to buy them down here.  I think it's the gold kicker (25%) that's keeping them down at the moment.  

    SPLS/Ging – Their on-line business was encouraging but no moat there other than brand name.  Outlook is $1.35 a share for $12.40 stock so not terrible – especially compared to ODP and OMX but, rather than sell the Jan $12 puts for $1.60 for a net $10.40 entry, I'd rather sell the next year $15 puts for $4.40 for a net $10.60 entry as you can make really good money on a spike up, more than the total of the $12 puts, yet your net obligation is no greater.  

    Dollar/Dawn – That would be $1.285 on the Euro and 95 Yen to the Dollar – neither very likely.  More likely the Euro holds $1.30 (just below it now) and the Dollar tacks lower next week as we aim to sell more TBills.  

    INTC/Yodi – Yes but they were cheaper then.  They're in a bad spot now, right between 50 and 200 dmas and too hard to predict with too low a VIX and no earnings to puff up premiums to sell.  

    Speaking of Euro/Angel – I love that logic – it must die to live…

    Deams/1020 – I dreamed of using scrapped oil tankers as floats and attaching them to hydraulics that would capture the wave energy as the 100,000 ton ship moves up and down.  At the time we were discussing it (early 80s), the tech just wasn't there to make it work and the OPTT boys came up with small-scale solutions using the same concept.  I'd still like to try it my way but still would be a massive project to accomplish.  

  66. rperi

    What do you make of this? http://www.foxnews.com/politics/2013/03/06/leaked-email-adds-fuel-to-claims-white-house-playing-politics-over-impact-cuts/
    Couldn't find a mention of it at any other reputable news source.  Seems sketchy to me. 

  67. albo

    Phil – Actually SD starting transitioning in 2008 more toward oil and less toward nat gas.  Now the company is much more of an oil play.  Regardless, I like the players in the name.

  68. Pharmboy

    Dendreon is running out of friends. (I have never been one of them).  More here.

  69. Pharmboy

    OK, IWM March 94s for 15c……come to papa…..

  70. yodi

    newt
    WYNN yes I have already 3 plays on them hope you followed

  71. newt

    Yodi- Yep  I am in.

  72. stjeanluc

    Looks like IBM had the biggest contribution to the rally in the Dow since 2009:

    http://online.wsj.com/article/SB10001424127887324539404578342723780666726.html?mod=ITP_pageone_0#project%3DDOW30_2013%26articleTabs%3Dinteractive

  73. stjeanluc

    And it looks like the correlation between the flow of money into equity funds and the market is tenuous at best and probably irrelevant:

    http://www.thereformedbroker.com/2013/03/06/chart-o-the-day-us-stock-fund-flows-2007-and-now/

  74. chasw

    Phil,
    Dreams / Placing the vessels in the Bay of Fundy with its 40 foot tide would give an interesting result

  75. dawnr

    phil I agree with you on $DXY…just the next 'fresh' levels if this one it is sitting in does not hold.
    thanks on FCX.  When I am not sure which way forward…I get out of my trade…until clarity returns

  76. phil

    BBook does not seem surprising.  

    Fed Beige Book: The economy grew at a "modest to moderate pace" in February with government fiscal and health-care policies noted for restraining hiring and spending. Employers in several districts cited "unknown effects" from the new health care laws as reasons for layoffs and reluctance to hire.

    More Beige Book: "Residential real estate activity continued to strengthen in most districts." Philadelphia contacts noted firm low-end housing prices as renters return to the market, but prices at the high end continue to fall. In manufacturing, expectations for future activity were "generally more optimistic" vs. the previous survey.

    No time to go into details as I have to go to doctor but markets not concerned either.  

    Fox/Rperi – Well there's your problem right there:  "any other reputable news source" – what you really mean to say is that NO reputable news source has that story…  Even the copy of the Email is not from Obama at all but from Charles Brown, who is relating what he heard in a "management team conference" so maybe the fact that it's an out of context quote from an unattributed source that is blown completely out of proportion is why no "other reputable news source" is carrying it.  

    Oddly enough, even the link to the Email is a lie as they say "partially redacted" but the only thing redacted is who it's to but it's clearly FROM Charles Brown and to "All", presumably in his department. 

    SD/Albo – I didn't know that, I'll have to take another look at their operations as I always think of them as more of a gas play and it's not a stock I usually follow.  

    Great chart StJ, thanks!  

    As to the flows – I wonder what will happen if money ever flows back in – that hasn't happened since 2004.  

    OK – Gotta go to Dr. see you guys after the close. 

  77. yodi

    Burr Credit on QCOM yesterday was only .20c but my Apr 70 caller dropped from .76 yesterday to .46 today You can not start looking at the Jan15 play one day after you entered it. the only thing to observe is the short month play.
    Just looking at my IOC plays going through the roof again today crazy stock. up 800 on my plays in one day but might be down tomorrow again.

  78. stjeanluc

    IOC / Yodi – Again, great find. You can make a mint selling far OTM calls on a weekly basis! I would not sell puts because that sucker might go kaboom one day. But plenty of money there…

  79. qcmike

    Phil
     
    TGT  target storesYou sees any opportunity; they are opening stores in Canada
     
    Thanks

  80. yodi

    newt
    WYNN I plan to hold my March back/ratio until the last day to squeeze ever penny out of it. Hope the wind keeps blowing until next week

  81. jabobeast

    You gotta be kidding…
     
    FU AAPL!!!!!!!

  82. rperi

    Thanks, Phil.  Had it forwarded to me from both my brother-in-laws. Waste of time to try to explain anything to them but trying anyway.

  83. albo

    Did anyone see something on CNBC about Icahn taking a stake in DELL?

  84. albo

    Never mind I found it.  Thx.

  85. ariveraA

    GDX reversal today.  Hopefully a bottom…

  86. Pharmboy

    Long 1/4 position ABX, July 33 Cs.  Selling 1/2 March 16 31s….

  87. Pharmboy

    CLDX….a beast I tell you…a beast….

  88. Pharmboy

    ZLCS….0.666 is the ask….buy buy buy

  89. Pharmboy

    ZLCS…buying another 1K shares.

  90. scottmi

    Sales – interview with Daniel Pink To Sell Is Human.

  91. mjjwo9b

    Phil / KMB –   Thanks.   I will kick it around for a day or so.
    CIM –  Any thought to rolling the short Call up to $3??

  92. dclark41

    Looks like we will have to wait until the end of day to see if there are any real buyers and sellers of AAPL. The volume up until now is pathetic.

  93. Burrben

    Yodi / QCOM
    I wasn't re-looking at it, I didn't get into it yesterday as it wouldn't fill.  So I filled it today for a credit of 0.74.

  94. yodi

    mjjwo9b
    I trust you talking about the Jan15 callers ? Hate to tell you I have not even sold any calls against the stock. Just Jan15 is still along way away!!!!

  95. newt

    WYNN/ Yodi: I did the April 110/125 with a short Jun 110 caller.

  96. stjeanluc

    It really seems that every time there is a small rally in AAPL like yesterday, people use that opportunity to get out!

  97. jasu1

    AAPL – Chinese torture— death by a thousand cuts- damn it !

  98. yodi

    newt WYNN yes we did the April as well all looking good

  99. jabobeast

    stjean and jasu1— I agree…. hopefully, these sellers are making a mistake.
    more annoying when you see everything else gaining steam..

  100. mjjwo9b

    Yodi / CIM:  Good for you.  That little train the could keeps chugging along.  

  101. rj_jarboe

    albo/sd
    Here in Kansas and down in Oklahoma, Sandridge is becoming one of the major horizontal oil drillers. I have been looking at them also, but have not made any trades. I have been seeing their trucks all over the place. I will take a closer look at your trade this evening. Thanks for sharing!

  102. stjeanluc

    AAPL / Jabo – I said it before, I still think that there are more sellers than buyers in AAPL right now, no matter that they are a good deal. Remember, 4 years ago you could buy a great place in Florida for 1/2 price, but everybody else was trying to sell theirs as well… That's the way it feels with AAPL right now.

  103. wombat

    Phil // Good Practice 
    Think you misunderstood my post. God no am I day trading. I have an IRA that was constructed after Katrina with 'disaster stocks'. Its done quite well I would love to just let it ride and not look at it – along with the 'toppy' talk of the Dow, trailing stops made sense to me. Thats where the question came from. Funny, because it's just the opposite of 'overtrading' – it's basically a buy and hold.
    I understand that each stock is different, so I've taken a BBand average on each and placed trailing stops just outside. My question was 'is it acceptable to combine this technique with covered calls' – ( I was thinking that if the shares stopped out, I would be sitting with naked calls ) – just wanted a second opinion 'like you're an idiot – of course they would' and you were my guy ; >

  104. terrapin22

    Phil – APA and EGO – your thoughts?  beaten down and at bottom of range.  Both have had fairly steady revs and ebitda.  

  105. lionel

    StJeanLuc
    Spot on comment on AAPL!
    At this level, I like to play ins and outs and sell puts on something else.
    One day the great run up will come but it may not be in this or the next quarter.
    FD: I bought yesterday July 450 calls for $20 ($3 per month + $8 earnings premium)
    These calls make $3 on a $10 run up. And that happens more than once a month with AAPL!
    Let s see if it works.

  106. wombat

    Guys //
    Taking the TOS PM test – harder than I thought ( Yodi said it was easy ; > ) It's all greeks – yikes. I think I got most everything but can you guys help me out on this one
    long an ATM calendar spread – position measured a the following greeks
    a. Long Vega, short Gamma, positive Theta
    b. Short Vega, short Gamma, positive Theta
    c. Long Vega, long Gamma, positive  Theta
    d. Long Vega, short Gamma, negative Theta.
    I also just found out that since this is for a joint account, I have to take two tests. arghhh.
     

  107. rj_jarboe

    albo/sd
    Curious why you chose to sell the Sept $6 calls @ $0.80? It looks like the May $6's can be sold for $0.50 and you might be able to do that 2 more times in the same time span? Also, what ratio of $6 callers do you feel comfortable selling to your $3 calls?

  108. stjeanluc

    AAPL/ Lionel – A $10 run is likely to happen every week as volatility is now around 3% per week so now we are looking at about $12 or $13 per week. The trick is to pick the bottom of a channel where you make that bet! Looks like around $420 now but I remember saying that 509 was a 50% retracement and that held for about 2 months. But now we are $80 lower, so who knows…. 

  109. lionel

    Wombat/
    What is being long ATM calendar spread? It is being long an option starting in the future.
    Buy April Put $50 Sell March Put $50 (same with calls) = long a one month option to put at $50 starting from mid March
    So the answer is the same as being long an option
     

  110. wombat

    lionel
    thanks but that doesnt help me much. i know what a calendar spread is, i just don't grok the relationship between all the greeks.

    delta – change in price
    gamma – sensitivity of delta
    vega – volatility
    theta – decay
    rho – interest rates

     

  111. lionel

    StJean/
    This is why I prefer to hit and run (I sold yesterday at $23.88 and I am trying to reenter tomorrow below $20.

  112. jr_mints

    wombat, short gamma, positive theta, long vega

  113. scottmi

    BIderman – he makes a good point in this one..more dollars ($4B/day POMO) chasing fewer stocks ($1/B less per DAY due to stock buybacks), without the economy or retail investors.  

  114. 1020

    scottmi – I have read 'To sell is human' - I've been using some of his ideas for years in business and now with teenagers!

  115. yodi

    terrapin22
    Hi, Looks like might flight to AC will only arrive in AC at 11.30 PM 27th April . Question is there any thing planed for the 27th.
    Thanks

  116. rj_jarboe

    Good Morning!
    To take a small break from the world of finance, for those of us that grew up with Wile E. Coyote, here is a supposedly new digital episode.

  117. stjeanluc

    Losing a little bit of momentum… Another pause maybe!

  118. phil

    Good morning!

    AAPL won their patent case against Samsung in the UK – that's sure to send them to new lows!  

    Futures are flattish with the Dollar at 82.45, after topping at 82.64 overnight..  

    Oil back to $90.69 as we expected them to hold out for the nat gas report, gold $1,581, silver $28.95, copper $3.4985, nat gas $3.476 and gasoline $3.1192.

    Euro made it back over $1.30, as expected and we need that to hold to stay bullish.  The Pound is right at $1.50 so another line to watch and the Yen is back over 94 at 94.16 but the Nikkei fell back to test 12,000 and is hovering at 12,030 as they are just a bit extended here. 

    As widely anticipated, the Bank of Japan has left its monetary policy unchanged in Masaaki Shirakawa's last meeting as governor, with the BOJ's key interest rate staying at 0-0.1% and its asset asset-purchase program at ¥101T. The real action is expected to come at the bank's next meeting in earl April, which is set to be led by prospective governor and uber dove Haruhiko Kuroda. (PR)

    Japanese shares rise 0.3% to close at 11,968.08, their highest in over four years, with export plays broadly rising. The Nikkei had broken the psychologically important level of 12,000 but fell back after the BOJ kept monetary policy unchanged. Other Asian stocks are mixed, while European shares are higher ahead BOE and ECB policy decisions. Hong Kong flat, China -1%, India +0.3%. EU Stoxx 50 +0.3%, London +0.3%, Paris +0.4%, Frankfurt +0.2%, Milan+0.4%, Madrid +0.6%.

    Biggest data day of the week except for NFP tomorrow, of course:

    Thursday's economic calendar:

    Chain Store Sales

    7:30 Challenger Job-Cut Report

    8:30 International Trade

    8:30 Initial Jobless Claims

    8:30 Productivity and Costs

    9:45 Bloomberg Consumer Comfort Index

    10:30 EIA Natural Gas Inventory

    3:00 PM Consumer Credit

    4:30 PM Money Supply

    4:30 PM Fed Balance Sheet

    Notable earnings after Thursday’s close: AMBABPZFNSRHRBMEDPSKULSQNMWDAYWPRTZQK

    Market recap: The Dow advanced to a second straight record close, but the broader S&P barely eked out a gain and Apple and Google pulled the Nasdaq to a slight loss. Data showed a welcome rise in private-sector payrolls last month, a less-than-expected drop in factory orders, and evidence of slowing retail sales from the Fed’s Beige Book. Commodities prices were mostly lower.

    7:23 PM Japanese stocks move higher again today, extending recent gains with the help of a weaker yen. The Nikkei Average broke above 12,000 for the first time since September 2008, rising 1% to 12,049, with exporters leading once again: Advantest (ATE +1.5%), Hitachi (HTHIY.PK +1.1%), Bridgestone (BRDCY.PK +2.7%), Toyota (TM+0.7%), and Olympus (OCPNY.PK +2.9%)

    6:00 AM Overseas: Japan +0.30%. Hong Kong -0.03%. China-0.98%. India +0.84%. London +0.44%. Paris +0.62%. Frankfurt+0.35%. 

    7:00 AM On the hour: S&P +0.17%. 10-yr +0.09%. Euro +0.38% vs. dollar. Crude +0.37% to $90.77. Gold +0.48% to $1582.4.

    U.S. economy, world's engine, remains in 'neutral' -Fed's FisherDespite the efforts of the U.S. Federal Reserve to use easy monetary policy to boost jobs, the country's economy is stuck in "neutral" more than three years after the end of the recession, a top Fed official said on Wednesday. "It is not possible to create jobs through monetary policy alone," Dallas Fed President Richard Fisher said at a World Affairs Council of San Antonio event. "The U.S. remains the economic engine of the world … it's not China, it's not Europe, it's the U.S., and the U.S. remains in neutral." Fisher, repeating a well-worn analysis of the limits of the Fed's super-easy monetary policies, said the U.S. central bank did not have the power to pull the economy from its standstill as long as U.S. lawmakers did not do their part. "You know how horrid things are in Washington," Fisher said. "We have provided fuel for an economic recovery because Congress and the executive have not provided the incentives for growth." 

    "The stock market is shrinking," writes Josh Brown, with February the busiest month ever for buybacks. Combined with increasing cash M&A and the lack of IPO and secondary issuance,there's less stock to go around. Repurchases are great when companies feel their stock is undervalued. When done to prop up EPS or because of a lack of investment use, not so good. February's action? All of the above.

    This is America, Now: The Dow Hits a Record High With Household Income at a Decade Low (The Atlantic)

    Viral Video Shows the Extent of U.S. Wealth Inequality (Mashable)

    Absent the usual last-minute drama and factional disputes, the House yesterday approved a bill to finance federal programs until the end of the fiscal year in September. The vote came well ahead of the deadline of March 27 and averts a government shutdown. The measure, which includes the $85B of sequestration, is due to be voted on in the Senate next week, when it is expected to pass.

    The Bank of England leaves policy unchanged, its benchmark lending rate remaining at 0.5% and the QE program dormant. The decision was expected by a most, though the bank has hinted it is beginning to lean towards additional asset purchases.

    French unemployment rose to a 13-year high of 10.6% in Q4 from 10.2% in Q3, due to companies lay off workers amidst an economy that appears to be sinking into recession. Excluding France's overseas territories, the jobless rate was 10.2% vs consensus of 10.1%. (PR)

    Draghi Confronts Italy Impact as ECB Seen Keeping Rates on HoldThe European Central Bank has to decide how big a threat Italy poses to Europe’s recovery. A rejection of austerity in the euro area’s third-largest economy has produced a political stalemate that’s driven up bond yields and undermined confidence in ECB President Mario Draghi’s scenario of a gradual economic upturn

    "If Italy is bust, so too are the U.K., U.S. and Germany, not to mention France," says Sky's Ed Conway, using a chart of declared vs real off-balance sheet liabilities from Albert Edwards to make his point.

    The Smoking Gun Of Spain's Unsustainability. (graphs)

    Now maybe people will believe me:  China's real-estate sector is not on track for a crash,as demand is high and leverage is low, say JPMorgan's Fang Fang, who's also a member of the Chinese People's Political Consultative Conference. It's that demand rather than bank lending, which is limited, that has caused property prices to rise and prompted government measures to cool sector. Those efforts have in turn led to volatility in Chinese stocks this week.

    Chinese Anger Over Pollution Becomes Main Cause of Social UnrestPollution has replaced land disputes as the main cause of social unrest in China, a retired Communist Party official said, as delegates to the country’s legislature lamented environmental degradation. China now sees 30,000 to 50,000 so-called mass incidents every year, Chen Jiping, a former leading member of the party’s Committee of Political and Legislative Affairs, said yesterday. Increased use of mobile phones and the Internet has allowed protesters to show their anger more effectively, he said.

    It's often been suspected, but now the Attorney General confirms the country's largest banks are too big to effectively prosecute. Eric Holder testifying before a Senate committee: "It does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the (economy)."

    Nobody rings a bell, says American Capital Agency (AGNC) CEO Gary Kain, presenting at the Citi Financial Services Conference (webcast) (slides). He doesn't feel he's got any better idea about when rates might move higher than the next guy, and says it's management's job to stay as fully hedged as possible.

    Foreclosure Sales and and Short Sales Account for 43% of U.S. Residential Sales in 2012 (RealtyTrac)

    Vail Resorts (MTN): FQ2 EPS of $1.65 misses by $0.05. Revenue of $422.4M beats by $8.27M. (PR)

  119. phil


    Recent data on gambling revenue in Pennsylvania highlights the potential danger of saturation within the gaming industry. With more East Coast casinos popping up, PA gaming revenue has nowfallen off three straight months including a double-digit dip in February. Caesars Entertainment (CZR -0.2%), Penn National Gaming (PENN-0.8%), and Las Vegas Sands (LVS +2.8%) are among the gaming companies with operations in the state.
     

    Post-Chavez Venezuela: oil’s next Saudi Arabia?

    Does the surge in gold mining stocks mean the bottom is in? Gold futures finish flat after a two-day climb, but the big story in recent sessions hasn't been the physical gold as much as the miners. The mining ETF (GDX +3.9%) is surging nearly 4% today, but that's after a ~20% YTD selloff. Today, miners are broadly higher: RGLD +4.5%,AEM +4.3%ABX +3.9%KGC +3.8%GG +4.1%NEM +3.3%.

    Transportation Secretary Ray LaHood wants more information about Boeing's (BA) redesign of the batteries of its 787 before he'll allow the jet to resume commercial flights. While the FAA is moving towards allowing Boeing to restart test flights – possibly this month – LaHood is taking a go-slow approach and is encouraging additional engineering reviews. The NTSB is due to release its interim report this morning on its probe into the battery problems.

    GM (GM) is working on an electric car that will have a range of up to 200 miles, CEO Dan Akerson said yesterday. "There will be breakthroughs in battery technology, they're on the horizon," Akerson said. This year, GM is bringing out a 75-80 mile EV version of the Chevrolet Spark. (See fuel efficiency) 

    An issue at this week's energy conference in Houston is how much oil could be saved if U.S. auto makers raised the average fuel efficiency from the current 23 mpg. GM's Dan Akerson says it should be a lot, as GM intends to cut the average weight of its vehicles by 15% and average fuel consumption 10% by 2017, and says GM could have 500K vehicles on the road using some form of electrification.

    General Motors (GM +1.2%plans to open a 4th technology center in the U.S. and hire a thousand workers to help shore up its in-house IT resources. The big picture: The automaker is undergoing a large-scale restructuring of its operations and systems in effort to become more productive and break down longstanding fiefdoms.

    Johnson Controls (JCI +6%) moves higher – making it one of the top performers in the S&P 500 – on reports that the company may sell its automotive interiors unit. A sale of the unit, which has struggled with margin pressures, low vehicle production in Europe and increased competition in China, would still leave the company with three major businesses: automotive seating, building controls and car batteries.

    More on DryShips (DRYS): Q4 misses across the board, as the shipper was hit by costs associated with its 10-year class survey for the Eirik Raude, plus losses on its sale of the new building tankers Esperona and Blanca. Looking forward, CEO George Economou comments that the short-term performance of the shipping markets remains bearish, as both tanker and drybulk spot charter rates continue to hover around historic lows. (Conference Call Webcast). Shares -4% AH. 

    Is Starbucks (SBUX +1.3%) immune to consumer spending worries? Bank of America is out with a positive note on the resilient food company pointing to channel checks which show strong sales momentum running nicely right along with the declining coffee input costs it's seeing. The firm has a $65 price target on shares.

    If J.C. Penney (JCP -3.2%) is to continue its shops strategy, Citi's Deborah Weinswig estimates it will need to raise $1B in capital or tap the same amount from credit lines. Though it's unquestionably a sobering amount for a retailer which lost over a quarter of its sales from a year ago, she sees light at the end of the tunnel if a buyout or asset sales can be arranged. In that vein, dealReporter wonders if Bill Ackman might double down with a bid to take JCP private.

    Furniture!  Pier 1 Imports (PIR) preliminary earnings for FQ4: Comparable-store sales rose 7.9% Y/Y as both traffic and average ticket size improved. Gross profit is expected to be 46.2% of sales, up 70 bps from last year's period, and EPS of $0.57 to $0.58 is forecast. (PR)

    The Dell (DELL +1.6%) leaks won't stop. Bloomberg now reports Blackstone has joined H-P and Lenovo in studying Dell's books during its go-shop period, and that Carl Icahn is seeking a$9/share special dividend as part of his leveraged re-cap proposal.Sources suggest H-P and Lenovo were more interested in getting a peek at a rival's books than in making a bid. Shares closed at $14.32. (more on Dell)

    More on Dell (DELL): Opposed to the buyout, one of the options Southeastern Asset Management has considered is investing alongside Michael Dell as he takes the company private. Another option: Teaming up with another player to make a higher offer. Separately, among those who showed interest as the board looked for other buyers were H-P and Lenovo. (Earlier: Icahn gets involved)

    More on Icahn/Dell: David Faber reports Icahn has a 100M-share position, has met with advisers to Dell's special committee, and is pushing for a leveraged re-cap instead of an LBO. He's expected to come out against the deal and call for a one-time special dividend – the special committee is said to be worried it can't lever up enough to make the kind of payout Icahn wants. 

    ARM's (ARMH) CPU cores are going into Baidu's data centers … and they might also wind up in human stomachs. Marvell (MRVL) says Baidu will use its ARM-based Armada XP server CPUs in systems handling cloud storage services. Meanwhile, Freescale (FSL) has developed an ARM-based microcontroller that measures just 1.9 x 2 mm, and says it's working with customers/partners on "products that can be swallowed." Though ARM mobile and server chips get more press, the company's growing microcontroller share is driving much of its unit growth. (previous) 

    EU antitrust regulators are closing a preliminary inquiry into Europe's five largest cellular operators over the development of new technology standards, saying that it's satisfied that the carriers had provided their work to industry associations. The EU had been concerned that Vodafone (VOD), France Telecom (FTE), Telecom Italia (TI), Deutsche Telekom (DTEGF.PK) and Telefonica (TEF) would shut out their rivals.

    Positive comments from Thorsten Heins contributed to BlackBerry's (BBRY +6.1%) rebound today. In an interview with Spain's Expansión, Heins suggested the Z10 has seen strong interest from users of rival platforms. The comments come a few days after aBGR report stated 1/2 of Canadian Z10 sales, and 1/3 of U.K. sales, involve converts. (earlier) 

    AT&T (Twill begin selling the BlackBerry Z10 (BBRY) on March 15, N4BB reports. The timing of Verizon Wireless' Z10 launch is said to be "still up in the air, but could be as late as April with a white Z10 exclusive." AT&T's supposed launch date meshes with past comments from Thorsten Heins.

    After expanding the reach of its fiber-to-the-home (FTTH) network by 33M households in 2012, China Telecom (CHA) wants to expand it by another 25M in 2013. Rival China Unicom (CHU) is also aggressive: it brought its FTTH network to 15.2M new households last year, and wants to add 10M this year. CHA and CHU respectively added 15.7M and 8.2M broadband subs in 2012, and hope to add 15M and 9M in 2013. With China now sporting over 1.1B mobile subs, CHA and CHU are increasingly counting on broadband and 3G data services to drive growth. - note that 1.1Bn mobile subs means everyone other than toddlers and infants have a cell phone!  

    The Google Glass feature no one is talking about (creative good)

    2010 Microsoft Wrote Some Checks That 2013 Microsoft Can’t Cash (TechCrunch)

  120. phil

    TGT/QC – Like many things at the moment – good but not cheap.  It's getting harder to buy things at these levels so better to wait and make sure the markets are comfortable with ATH's.

    CIM/MJJ – I like the protection.  Don't forget, we COULD get a sell-off.  I know it's been so long it seems unlikely but these things do happen from time to time and sometimes it's just nice to accept the fact that you'll "only" make 50% on a position that is nicely in the money, rather than constantly spending more money to increase your risk chasing after another 20% that maybe you'll never get anyway. 

    AAPL/StJ – True, there's no exit for those who want to get out and move on so the fire sale continues until we get rid of all the old holders.  Then, also like Florida real estate, it could double in a year. 

    Stops/Wombat – OK but point is, don't try to time everything.  If you sell a call then you are projecting to make a certain amount over a certain period of time and, if your caller is well in the money, then your position is doing well and you can move it to the "don't worry" pile and just wait to collect your net.  If you instead try to stop and roll and re-position, you are trading those birds in the hand for 1.5 in the bush and, even worse, you are wasting time you could be spending finding new and more profitable things to trade. 

    APA & EGO/Terra – I'll have to look, remind me later.

    27th/Yodi – I'll be there the 25th (Thurs) so hopefully, by the 27th, something is going on.  

    Coyote/RJ – Interesting.  Does a pretty good job of sticking to the original formula but the orchestration is off – need a real symphony, not samples.  

    Big Chart – Still super-strong – anything but down is strong now.  

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