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Turn-Down Tuesday – Even Coke is Having Problems!

7-15-2013 6-55-48 PM gdpKO disappointed.  

It's not good when Coca-Cola misses revenues.  It's usually an indication that the consumer is really hurting.  Net Income fell to .59 for the quarter, down from .61 last year but it was the 3% drop in Revenue that was surprisingly light, leading CEO Muhtar Kent (a straight-shooter - see my 2010 interview) to state he "was not happy with our performance."  The beverage maker cited "a challenging global macroeconomic environment" and bad weather for its performance.  

Rather than shorting KO, we're shorting oil this morning and I sent out a tweet early this morning, identifying a shorting opportuntiy on /CL Oil Futures at $106.45 but we stopped out of those at $106.50 and now we're looking at the $107 line as our next shorting target, waiting for the big drop we are fairly positive is going to come as we head into the NYMEX contract rollover next Monday.  I'm not going to get into it again (see last few weeks of posts) but the bottom line is they have faked way too many orders for September and now they have just 5 sessions to cancel or roll 130,000 contracts, about 25,000 contracts per session and, yesterday, they only managed to get rid of 13,000 – that does not bode well for the NYMEX Fraudsters.  

Click for
Chart
Current Session Prior Day Opt's
Open High Low Last Time Set Chg Vol Set Op Int
Aug'13 106.44 106.74 105.91 106.47 05:23
Jul 16

 


-
0.15 16473 106.32 138979 Call Put
Sep'13 105.96 106.24 105.46 106.05 05:23
Jul 16

 


-
0.13 6807 105.92 336220 Call Put
Oct'13 104.64 104.80 104.11 104.66 05:23
Jul 16

 


-
0.17 1101 104.49 125043 Call Put
Nov'13 103.20 103.20 102.75 103.06 05:23
Jul 16

 


-
0.07 561 102.99 74312 Call Put
Dec'13 101.63 101.82 101.16 101.77 05:23
Jul 16

 


-
0.21 1132 101.56 211463 Call Put

By next Monday, all but maybe 15,000 of those contract (1,000 barrels per contract) will disappear.  This will create an artificial shortage of oil in August as no orders mean no deliveries and no deliveries mean inventories will be drawn down, whether demand is actually there or not.  We'll watch this crime in action this week as NYMEX Terrorists threaten our Nation's energy security by tearing up oil contracts (that are already approved for delivery), choking off the supply of oil to our great nation and extorting Billions of excess Dollars from US Consumers at the pump, in the Airlines and to heat, cool and power their homes and businesses.  

As usual, our leaders will do nothing.  

No wait, I take it back.  As usual, our leaders will collect another $30M in bribes from the Koch Brothers.  That's the Koch's average annual spending to buy better themselves better Government.  It's only a sliver of their $50Bn fortune (50,000 Million and, as you can see from the chart on the left – they sure get their money's worth) but there's only 435 Members of the House of Representatives and 100 Senators and $30M/535 is still $56,000 per Congressman from the Koch brothers alone.  Given that about half of those Congresspeople are Democrats, who generally get $0 from the Kochs – we're into 6-figure pay-offs to the average Republican.

In fact, according to the Kochs, those bribes alone makes their Republican cronies 3x richer than the top 1% (I kid you not, this is their actual video explaining it):

That's right you "poor" people – suck it up, you're 10 TIMES richer than people who are REALLY poor so stop your whining and vote to end that minimum wage so you can compete fairly with people making $2.50 a day in China!  

According to the Koch Brothers, making $34,000 a year for a family of 4 puts you in the Global Top 1% – so your interests and their interests are perfectly aligned!  If this is the kick-off to the 2014 mid-term election strategy for the GOP, I know a lot of Democratic strategists who will be having a party this weekend!  

The GOP is convinced they are going to take back the Senate next November because Americans are sick and tired of getting JOBS and having PEACE and PROSPERITY, with a stock market that is now up 200% since finally getting rid of George Bush II in 2009.  We don't want those high-mileage cars or roads without potholes to drive them on.  We want FREEly poluted water and air that you can cut with a knife – just like China!  

That's how we compete globally in the Koch Brothers Fantasy Camp – drop US wages to be on-par with the rest of the World (10% of what we make now on average), stop taxing Corporations and Wealthy Individuals (like the Kochs) and let those Corporations do what they want (as if they don't already).  

If you aren't for those things – you are a Godless, Anti-American Communist who should stop voting and leave the country (where the new immigration laws will prevent you from coming back).  

Speaking of Godless Communists, China financial instability du jour is an 800% increase in WMPs, or "Wealth Management Products" where over $1Tn of Chinese savings (the size of Australia's total economy) is now in instruments that are, essentially, Ponzi schemes, where the investor puts in money for "guaranteed" 1% WEEKLY returns.  

As investors pile in, financial firms need more inflows of cash to pay off maturing products, resulting in mounting risks that prompted China Securities Regulatory Commission Chairman Xiao Gang to call them a “Ponzi scheme” even before the latest record purchases. Issuance of new products and borrowing from the interbank market are among the most common ways banks pay out maturing WMPs, according to Fitch.

The WMP market has inflated to a huge size,” said Wilson Li, a Shenzhen-based analyst at Guotai Junan Securities Co. “Should they go bust, Chinese banks have their reputation on the line, and they face the risk of compensating investors because of pressure from the general public.”  A record 1,137 WMPs were sold by about 70 banks in the two weeks ended June 28, an increase of almost 50 percent from the first two weeks of the month, according to Benefit Wealth, a Chengdu, China-based consulting firm that tracks the data back to 2007. 

“In an environment where liquidity is tight, banks will find it more and more difficult to attract fresh money to keep the game going,” said May Yan, a bank analyst at Barclays Plc in Hong Kong. “Until investors are hit by a real default, they won’t understand what they are really buying into.

Our June CPI was 20% too strong (up 0.5% for the month) and our Chain Store Sales were 20% too weak (up 3% from last year vs. up 3.6% last week) and Retail Store Sales were DOWN 1.1% for the week vs +3% last week and that's dropped the annual run rate from +2.9% to +1.7% on this week's total disaster as people's disposable income goes into the gas tank – THIS IS NOT COMPLICATED FOLKS!!!

The American consumer is at the end of their rope and it's not like Europeans or Asians or Emerging Marketeers are carrying the consumer ball for the Global Economy.  Corporations are not spending and the Fed is telling them that, IF they hire, THEN the Fed will cut off the Free Money.  So, surprise, surprise – THEY'RE NOT HIRING!   Again, not complicated – very simply cause and effect all around.

On the bright side, Goldman Sachs DOUBLED their profits to $1.93Bn as endless supplies of Free Fed Money was converted into incredible trading gains on the stocks, currencies and commodities they manipulate – accounting for $2.46Bn of the bank's Revenues.  Oh, and please, please, PLEASE do not bee fooled by "just $1.93Bn" in profits for GS – that's AFTER they distributed $3.7Bn to compensate their employees (32,000, so $1M each if distributed evenly, which it's not!) through bonuses on the $1.93Bn the company allowed to trickle down to their stocksuckersholders.  

Don't bother sending this article to your Congressman if you want things to change – send them a check instead – that's how the Koch brothers get things done!  

 


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  1. stjeanluc

    Oil Lines

    R3 – 109.06
    R2 – 107.9
    R1 – 106.97
    PP – 105.81
    S1 – 104.88
    S2 – 103.72
    S3 – 102.79

    Yesterday's high and low – 106.74 / 104.65

  2. stjeanluc

    I won't be around at the open so I will update the portfolio a bit later when I come back in front of my PC.

  3. BruceE

    This one is working, Phil.

  4. Dennis

    You're shot out of a cannon today, Phil.  Great article.  

  5. Phil

    Good morning!

    Big wheeee! on oil finally, $107 did the trick and we're flying down below $106.50 to $106.33 so stop at $106.50, of course.  We still have API tonight and EIA inventories tomorrow but the key is that HUGE overhang of contracts that MUST clear in 5 business days.  

    Generally bad macros this morning but TSLA's dropping like a rock despite a moronic upgrade to $230 from Northleand Capital, whoever they are.  Goldman just called them out and used my logic (and my price target) to do it so I'll be nice to GS for the rest of the day.  

    Goldman's Patrick Archambault isn't buying Northland Capital's $230 Tesla (TSLA -4.1%price target. Archambault's bull case assumes a 3.5% global market share in the entry- and mid- luxury categories, equating to 200K units sold. Applying a 15.2% operating margin implies $113/ share. The bear case (which assumes total sales of 105K units, operating margins of 14.6%, and a 20x p/e multiple) values the stock at just $58. Goldman's target price is $84, only 34% below Monday's close.

    On the other hand, GM is up when it should be down due to GS and, in the STP, I'm for selling 5 Aug $36 calls for $1.55 ($930) and buying 3 Dec $40s for $1.25 ($425) for net $505 credit.  

  6. yodi

    Phil If you can handle NFLX as you handle TSLA you are my man!!!

  7. bgbigelow

    Hey Phil,  I think the GM math is off.  It looks like it should be: (1.55 * 5 = $775) – (3 * 1.25 = $375) = $400 credit not $505 credit.  Do you think the trade still makes sense?

  8. Phil

    SPY 5 MINUTEThis chart from Dave Fry sums up yesterday's action quite nicely.

    The volume just wasn't there so nothing the market did matters.  Now we have our usual Tuesday AM pump job but it's not likely to hold off that retail data and, don't forget, as I pointed our earlier, the only reason we're not opening down 0.5% is because the Dollar was dropped to 82.60, from 83.60 on Friday, so more than 1% in two days.  

    Good job on oil Bruce but I hope you are not being greedy as we're back over $106.50 again. 

    Thanks Dennis, I could have kept writing on the Kochs for hours, those guys really piss me off! 

    Homebuilder sentiment is going to be our best news of the day at 10 – we'll see how we get through that. 

    At the open: Dow +0.02% to 15488. S&P +0.07% to 1684. Nasdaq +0.06% to 3610.

    Treasurys: 30-year +0.07%. 10-yr +0.01%. 5-yr +0.01%.

    Commodities: Crude +0.19% to $106.12. Gold +0.55% to $1290.55.

    Currencies: Euro +0.42% vs. dollar. Yen -0.38%. Pound +0.05%.

    10:01 AM On the hour: Dow -0.09%. 10-yr +0.07%. Euro +0.47%vs. dollar. Crude +0.25% to $106.19. Gold +0.53% to $1290.35.

    Market preview: Stock futures have leveled off after CPI came in slightly higher than expected, with the S&P Mini almost unchanged. Market economist Peter Cardillo reckons the market will "take a rest after its run to record highs." Coca-Cola -2.8% on the heels of disappointing earnings, although Goldman Sachs is +1.1% and J&J is +0.7% following their results. Later: NAHB Housing Market Index

    Mort Zuckerman: A Jobless Recovery Is a Phony Recovery. More people have left the workforce than got a new job during the recovery—by a factor of nearly three. In recent months, Americans have heard reports out of Washington and in the media that the economy is looking up—that recovery from the Great Recession is gathering steam. If only it were true. The longest and worst recession since the end of World War II has been marked by the weakest recovery from any U.S. recession in that same period.

    Redbook Chain Store Sales: +3.0% Y/Y vs. +3.6% last week.

    ICSC Retail Store Sales: -1.1% W/W, vs. +3.0% last week.+1.7% Y/Y vs. +2.9% last week.

    June Consumer Price Index: +0.5%;vs. +0.4% expected, +0.1% prior. Core CPI +0.2%;vs. +0.2% expected, +0.2% prior 

    June Industrial Production: +0.3% vs. +0.2% expected, 0.0% prior. Capacity utilization 77.8% vs. 77.7% consensus; 77.6% prior

    May Treasury International Capital: Net foreign inflow of long-term U.S. securities were $56.4B, with net inflows by private foreign investors of $46.6B and net inflows by foreign official institutions at $10.0B. Taking into account both foreign and U.S. securities, the net foreign purchases of long-term securities were -$27.2B. Foreigners decreased their holdings of U.S. T-bills by $39.2B.

    NAHB Housing Market Index: +6 to 57, vs. consensus of 52; 52.0 in Mar.

    Sentiment towards China (FXICAF) continues to worsen, according to the BAML Fund Manager Survey, with 65% seeing the country's economy weakening in the next year. In December 2012, the same percentage saw things getting better. Meanwhile, the appetite for developed-market equities (VTI) continues to grow, with those overweight stocks up 9 points in 2 months to 52%. 83% favor the dollar (UUP) over other currencies, the highest in the history of the survey. 55% are now underweight fixed income (AGGBND), and average cash holdings are up to 4.6%, the highest in a year. "The Great Rotation is in full force," says Michael Hartnett. 

    China Falters in Effort to Boost ConsumptionGrowth in Urban Households' Disposable Income Slows, Hindering Beijing's Plan to Cut Emphasis on Unreliable Exports. China's push to get consumers to open their wallets more and refocus the economy on domestic consumption is stalling, contributing to lower growth in the second quarter.

    China's Richest Village in Jiangsu May Fail. Huaxi village in eastern Chinese province of Jiangsu, so-called the nation's richest village, may fail as most of its factories are empty, citing its own investigation.

    17 Reasons Why Experts Are Convinced China's Economy Is Doomed.

    It's another quiet day for Southeast Asian markets as caution abounds ahead of testimony from Bernanke on Capitol Hill this week. Thai (THD) shares and the Straits Times (EWSEWSS) fall 0.27%and 0.37% respectively while Philippine stocks (EPHE), which wereFriday and Monday's regional standout, slip a half percent on the session. Indonesian equities (IDX, EIDO]]) are +0.2%, Vietnamese stocks (VNM) rise 0.43%, and Malaysian shares (EWM) — whichBarron's called "the new belle of the ball" last Saturday — trade largely flat. 

    Nearly all the BRICs are in tightening mode after the Reserve Bank of India moved to shore up the rupee by jacking up interest rates 200 bps to 10.25% and commencing government bond sales to further drain liquidity. The Sensex fell 0.9% overnight. Indian ETFs to watch: EPIINDYPININPINDAINXXSCIFSCININDL

    With house prices rising, profits healthy and financing available, large publicly traded house-builders such as Lennar (LEN), NVR (NVR) and Toll Brothers (TOL) have been buying up their smaller privately held rivals, which have had trouble getting funding for new developments. Ryland Group (RYL) is onto its third acquisition in a year. To stay independent, some private companies have listed, with three IPOs in the sector taking place since January.

    Eldorado Gold (EGOlowers its FY13 exploration budget to $51M from $98.5M, defers the expansion of the Kisladag mine, and lowers planned capex to $430M from $670M. The company cites the "significant decline" in gold prices and says the new plans will allow it to "further develop its business" in the face of $1,250/ oz gold.

    Johnson & Johnson (JNJ): Q2 EPS of $1.48 beats by $0.09. Revenue of $17.88B beats by $0.17B. (PR)  More on Johnson & Johnson (JNJ) Q2: net profit $3.83B vs $1.41B, with this year including one-time items of $500M and last year $2.2B. Revenues +8.5% to $17.88B; domestic sales +8% and international sales +9%. J&J increases 2013 adjusted EPS guidance to $5.40-$5.47 vs consensus of $5.41. Shares +0.8%. (PR)

    More on Johnson & Johnson (JNJ +1%Q2: Sales boosted by the acquisition of Synthes, whose integration continues to be "successful." Sales breakdown: consumer unit +1.1% to $3.7B; global pharmaceuticals +12% to $7B; medical devices & diagnostics, JNJ's biggest unit, +9.6% to $7.19B. Strong sales results of recently launched products included Zytiga (prostate cancer), Xarelto (anticoagulant) and Incivo (hepatitis C). The earnings call has just begun. (PR) 

    3.6% Dell (DELL -1%) owner Blackrock is seen voting against the LBO deal, David Faber reports. "Pretty soon the math gets tough for Michael." Shares are now 4.8% below the $13.65/share offer price; the official vote comes due in two days. (previous)  

    Good, I hope these too-expensive bastards choke on their service!  Gogo (GOGO -7.4%) is diving on underwriter coverage day, even though the in-flight Wi-Fi services provider has caught 3 bullish ratings (William Blair, JPMorgan, and UBS) to go with 1 neutral one (Morgan Stanley). JPMorgan praises Gogo for giving domestic airlines "the fastest and lowest cost entry to in-flight broadband," thinks it has only a handful of credible international rivals, and expects services such as Gogo Vision to increase its value. But Morgan Stanley thinks Gogo's growth and barriers to entry are offset by low take rates, something attributed to the limitations of current tech (i.e. low bandwidth and high prices). The firm also sees tougher competition abroad. (IPO day fall)

    Senate heads for showdown as Reid demands GOP approve nominees — or elseSenate Majority Leader Harry Reid issued an ultimatum to Republicans on Monday to confirm at least seven presidential appointees or face a controversial rule change that could drain their power. A late night meeting attended by nearly every senator failed to produce an agreement to resolve the dispute. After the hour-long session, Democratic Senate leaders reaffirmed that a key vote on the issue was scheduled for Tuesday morning.

  9. albo

    Bought some NUGT @ 5.81.  Sold Aug 6 calls for .80.  If stock @ 6 or higher at expiration, it's a 17% return for 31 days.  If ABX, the poster child for weak gold stocks, can rally.  NUGT should be good for a bounce.  If not, I'll write it again.  Not selling puts at this point.

  10. deano

    Phil – BAC earnings are tomorrow am, and they've done nothing but climb the last month. How about a backspread on them?

  11. Phil

    NFLX/Yodi – That one is completely out of control but some thing – we focus on the $500+ we lost and simply make a new bet into earnings at this insane number ($265 today).  

    GM/STP, BGB – Thanks for fixing the math.  Credit $400, not $505 but I do still like the trade as that Europe number was very bad (see morning news in last post). 

    TSLA bagholders having trouble finding real buyers at $120!  

    NUGT/Albo – I like that play as we really don't see gold staying below $1,250 for long.  In fact, EGO just scrapped a mine and cut E&P over price of gold (news above) so we are, in fact, at the breaking point where the price of gold forces production cuts.  This is exactly WHY I like to back the biggest and best commodity suppliers like ABX, BTU, FCX, even XOM when their commodities crash, as they are best able to weather the storms and come out the other side usually stronger than they went in.  

    BAC/Deano – C just had nice numbers and are up 1% and BAC was my stock of the year last year and $15 is my long-term target so, to some extent, I think they are just finding their proper level..  C is justifying a 100% gain from last July, BAC was $7 last July and now $14 so I don't see them as a good bear bet and the premiums aren't such (.40 for the Aug $14s) that you want to risk a 10% move going against you ($1.50 to $15.50).  So I would just stay away or, if you want to have real conviction shorting, the Aug $15 puts are just $1.10, wich only .10 of premium into earnings and the $14 puts are .40 so you can do that spread for net .60 and make .40 (66%) if BAC fails to get over $14 – much simpler than a backspread – IF you want to be bearish. 

    Oil failing $106! 

  12. newt

     NFLX/Too expensive: wow- up again. June 26 they were around $212. I have a Sept 205/225 BCS and the long prems are not moving- the short is up 4.24… (go figure) the short put Jan15 $145 has not budged either. What gives?

  13. albo

    A number of Momos getting hit today:

    TSLA, SCTY, LNKD, XONE, SSYS, CMG, etc.  NFLX Didn't get the memo.

  14. newt

    DVA/ Phil: "once they have you on it they have you forever"-- Kinda like smokes. That might make a good portfolio as a side or an add to the Income Port- a basket of got you for life products. I'd like to head that up if possible. Starting with the following categories: Banking, Consumables, Entertainment, Medical.  Any other catedgories to look into? Some holdings may overlap.

  15. stjeanluc

    I think that cashing in at least 1/2 of the TSLA puts is the prudent thing to do!

  16. deano

    Phil – thanks for your input as always. I'm just curious on how your target on XLF was $20, and how you don't see see BAC as toppy here. Did you think WFC, GS & JPM were going to miss, or has your mind changed on XLF? Thx

  17. snow

    Got you/Newt – in ancient times "cobbler" was a very secure craft, because people always need shoes. Still do.

  18. Phil

    SCTY down 5% as well, glad we took the long money and ran yesterday!  

    ABX $15.80 – the world is going sane all of a sudden!  

    NFLX/Newt – The bull call spread won't do anything as the short calls have more premium than you do on the long side.  Not much you can do about that except let it burn off.  When a stock goes up violently (applies to put side too) the intenal volatility goes up and the options stay expensive – not good if you are an impatient seller of options who needs to see immediate gratification but just fine for a guy like me, who's happy to be "on track" and ignores the noise in between.

    Momos/Albo – As I noted with Jabob yesterday, it's just about when people reach their capitulation breaking point that we tend to have these turns.  That's why I prefer fundamental trading – once you learn to have convictions, they make your trading life a lot easier.  

    I like that idea of a Life or Death Portfolio, Newt.  Funeral business is good too along with hospitals, etc.  

    TSLA/StP, StJ – Well, now it's in the money at $13.50 and getting interesting.  I think we have to take 1/2 off the table here and stop the rest at $11.50 for a $12.50 average.  I still think TSLA goes to $100 or lower again so I am not in a big hurry to fold a potential $20,000 position but, of course, it would be silly not to take $6,750 now ($13.50) as, even if it's "just" $10,000 later on the last 5, that's still $16,750 vs holding out for $20,000 while a reversal back to $11.50 if we don't take profits costs us way too much potential gain.  

  19. Phil

    XLF/Deano – That's the same target we had for ages as $20 is a very significant upside resistance and 100% over the 2011 bottom and 50% over the 2012 average and, frankly, the bank earnings are not growing that fast and they are only growing due to QE and rising rates are huring the non-iBanks (haven't reported yet) and the economy sucks.  So, on the whole, $20 is likely to be, at best, a consolidation point (meaning selling calls over it makes sense) and, at worst, at top on the way back to re-test $18 (20% retrace), which also happens to be the 200 dma.  

    Cobbler/Snow – Only now you have to know the Chinese word for cobbler!  

    Rants/Newt – Speaking of rants, John Oliver had a great commentary on Zimmerman yesterday (video below) but first, you have to check out this one.  

  20. lionel

    Pharm/ Any adjustments to your weekly AAPL butterfly?

  21. Savi

    LV Meeting Update Novmber 10th and 11th 2013

    I have been negotiating with Caesars in LV and have come up with the following deal (for it to work we need at least 40 people to commit)

    the room rates at Caesars for Sat and Sun are $259 +tax, $109+tax respectively--no resort fee--free internet in rooms

    registration fee will be $400 for the first 20 who sign up with a rebate of $75 from the next 20 who sign up and the 2nd 20 and the 1st 20 will get another rebate from the 3rd 20 who sign up—please note that the rebates are contingent on getting 60 or more registrants--(are your eyes glazing over as yet) the breakdown is as follows

    1st 20-- pay $400   -$75  -$50

    2nd 20-- pay $400  -$50

    3rd 20 --pay $400

    Two meals are included—lunch on Sunday and breakfast on Monday

    please e-mail me asap at savi_ted@hotmail.com

  22. Phil

    STP Update – What a difference a day makes!  Now, if only we can put two winning days in a row together, we'll be back to even.  This once again proves out my theory that the best way to follow our trades is only to enter the ones that we already have to be rolling up or doubling down – you miss our early mistakes!  

    • SCTY – 40 is a lot but now $41.86 so I sure as hell don't want to pay $4.70 to cover $40 calls that are only in the money because this stock follows TSLA and not the solar sector – which is actually holding up well today on good news. 
    • LQMT – Waiting on AAPL
    • SBUX – Our new trade is, so far, working better than our old one. 
    • GLD – $1,289 and we're stilll at .01 – this one not likely to come back. 
    • AAPL – Still in the money but only barely. 
    • TLT – $108.59 and we need $111 to make up our July losses but, on track with a small gain today.
    • AMZN – Wow, actually not up today!  
    • DIA – Need a much bigger drop than this to get these back on track. 
    • USO – $105.75 was the bottom, now $106.15 and good for a re-load on the Futures but, on these, we're waiting for a proper drop.  
    • FAS – A little scare in the morning but fine now. 
    • FXI – As the house in Amityville likes to say:  GET OUT!!!  It didn't work, our markets are sofening and we don't like the China newsflow so we're done with this one.  
    • TSLA – As noted above, 1/2 out at $13.50 and hope we don't trip our stop at $11.50 before they go into a power-dive.  
    • NFLX – $262 – OVER our puts!  Not high enough to make buying back our short putter attractive as we intened to risk $2.32 to make $5, not risk $21 ($19 of which would be premium) into earnings!  
  23. deano

    Phil – that's my point, and given that BAC is a component of XLF, not sure how you're bearish (or at least not bullish) on XLF, and more bullish on BAC? It seems to me that BAC is one of the weaker components in XLF – so just trying to understand -thx

  24. biodieselchris

    NFLX wait for $300 and then make a million dollars.

  25. Phil

    Vegas Baby!  Thanks Savi.  For those of you who went to AC, correct me if I'm wrong but this pay first and get a refund system worked out well for the early signers, right?  It seems nice and fair because we can't lock up the rooms without a minimum commitment and, usually, half the people are very slow to commit, but do eventually.  In fact, last year we were busting out of Cafe Moda.  

    Note these rooms are excellent at Caesars – it's my favorite LV hotel but I usually don't stay there because $500 a night is more than they charge at the Mandarin or 4 Seasons (about $300) – this is even cheaper for the rooms.  

    As usual, we'll probably have a nice dinner on Saturday night, this time we can do Rao's since it's very good italian and way less than Nobu and then we can have a poker tournament Sat after dinner.  Sunday whoever wants to can meet at Nobu after the meeting – both restaurants are right in the hotel so we won't need cars, taxis or anyting else.  

    Of course, you know me, I'll be camping out at Caesar's all week most likely!

    XLF/Deano – BAC, C, GS, JPM are all going to hold XLF up.  Regional banks will likely be under pressure as will insurers and that will pull it down.  $20ish is equilibrium. 

    $300/BDC – I just may have to try that play (maybe 500 $100 puts for about .20) – just in case it works out…

  26. millcreek

    phil,

    morning, few smiles vis a vis tsla today. 

    need some advice re managing position.

    based on last weeks discussion, i now own 10 bcs 100-150. 

    im short 20 jan 125's and 5 sht jan 15 125 (from roll last week) and sht 8 jan15 95 puts.

    can you give me an idea i.e. an outline on how to go reducing exposure/ minimize loss as we go down in price.  for instane tos is showing a + 12k today.  am i right in trying to reduce my exposure.  i.e. buy back 5 call and 2 puts or let this play out since i have re worked the position based on the 125 + price last week.   tks

    p.s. based on the latest prices not original if i bought back 5 call +3500 and  2 puts -600

  27. biodieselchris

    NFLX / $0.20 -- those are the types of plays I like….

  28. biodieselchris

    I think PCLN might fall apart if there is a general market downturn. Premiums are high. Maybe a bear spread?

     

    I'm looking for <800 or so by mid August.

  29. wombat

    Phil // TSLA
    Funny. I've been waiting for this and now I'm like a deer in headlights. 
    I have the +40 bull call spread ( $100/140 ) still profitable and the -20 short $150's up 23%

    what would the strategy be here ?
    do I cash oiut half the bull call spread to cover the shorts and let it run ?
    do I cash all the shorts and wait for a bounce ?

    love your instincts here //

  30. jabobeast

    Phil--you broke out of the slump!!!!

  31. biodieselchris

    somehow I just bough BLDP Nov13-4c for 0.05

  32. zeroxzero

    bioD:  I agree NF*X – sold a couple of July 20 $285s, if it jumps over 8% today then I am defintely a monkey's uncle.

  33. jabobeast

    This morning, Jefferies increased its price target on shares of Priceline.com (PCLN) to $1005 as travel demand to Europe is improving. With the higher price target, Jefferies increased its EPS estimates through 2014 and reiterated its buy rating. Shares of Priceline were lower today, falling 1.3% so far.

  34. jabobeast

    UBS increased its EPS estimates on shares of Priceline.com (PCLN) through 2014 as the company should continue to outperform its peers. In the report, UBS reiterated its buy rating and set a price target of $1035. Shares of Priceline were lower, despite the report, falling 0.8%.

  35. Phil

    TSLA/Mill – LOL, now you're worried about them going DOWN?  That's too funny!  If you remember, those are the ones I was worried about and you were supposed to put a tight stop on 1/2 of them because, as I said: "you can always re-cover if you think the stop shouldn't have triggered but you'll be much more pissed if TSLA falls below $95 and you're stuck with short puts." 

    Anyway, So, you have 10 $100/150 bull calls spreads (2015?) and you're short 20 Jan $125 calls and 8 Jan $95 puts (should be 4).  I'm not sure where you stand overall but, if you are + $12,000 today and that makes the whole trade even(ish), then why not shut the whole thing down, take a day or two off from it and come back in with a small, sensible trade (if you still feel like playing in the madness).  

    As you can see from our STP move – I'd rather be small and flexible with such a crazy stock and ONLY press our bet when it's extreme in the range.  Since our range is $85-125 – $115 isn't as extreme as $130 was and, so, I'd rather have ligher bets. 

    If you want to get move short, you are better off selling one of your long $100s and letting the short $15s hang out to dry as you can always roll the short puts (unless you detest the idea of owning some TSLA one day).  I'd hate to see the puts crush you as TSLA can easily drop back to $100 and maybe lower if they blow earnings and, if you're worried about the PRICE of them and not the value – you're not going to like the result but I'd focus on the fact that you made $12,000 on your position, DESPITE the fact that it's offset by 8 unfortunate puts where the losses are 100% premium – so you made a lot more than that on your main position.  

    NFLX/BDC – Fun to go for 10 time on different things and, if you hit one – it was all wortth it!  

    PCLN/BDC – Too scary to short.  There's a real business under there.  Like LNKD. 

    TSLA/Wombat – Another one???  If you had 40 long spreads and just 20 short calls, you weren't very bearish.  The bull spreads are 2015, they're only $13 and the short $150s (Jan?) are now $9 and the net delta of the spread is not even .20 and the delta of the short calls is .31 so it turns out you are only .10 bearish per $1 – a very tedious way to make money!  I'd certainly cash out half the spreads so you are "normally" bearish on TSLA and you can always add them back if it bounces but, otherwise, you wait for expiration with a 3:1 delta advantage to the downside.  

    Thanks Jabob – like all streaks – they tend to come to an end.

    BDLP/BDC – Never hurts to ask.  

    NFLX/ZZ – Hopefully not today but on earnings – who knows? 

    PCLN/Jabob – I guess travel is improving as everyone rushes to get out! 

  36. Pharmboy

    VEGAS baby!  Game on!  Thx Savi.

    AAPL butterfly….no adjustments lionel.  this was an all or nothing trade.  If you are even or up, get out if you don't like the action.  I think they pin on that MA line which is…..right at the butterfly body…

  37. Savi

    LV Update

    5 of the first 20 spots are taken

  38. Investwizard

    Abx yeah! Tsla seems it’s a day to kill the greedy bastards or ad driven stock buyers. We might see $100 by the end of today, then strong reversal in tomm? Who knows… :)

  39. millcreek

    phil,

    im going to review all the rolls etc to see what it comes to……but pls the last thing im worried about is tsla going down……

    i would love to see the sht 95 puts itm (big f/n smiley face)

  40. philisit

    I actually just made money on TSLA… wow! thx guys for keeping it real here!

  41. jabobeast

    1:30 PM Checks suggest Priceline's (PCLN -1.8%) Booking.com unit is seeing strong user review and listings growth, and continues to grow beyond its core European markets, says Jefferies' Brian Fitzgerald, who is raising his PT to $1,005 from $860. Fitzgerald, who is nudging his EPS forecast higher, adds traffic data points to strong unique visitor growth for both Booking.com and discount hotel reservations site Agoda. Fitzgerald's note comes a day after UBS raised its PT to $1,035, and a week after Morgan Stanley upgraded Priceline on expectations of stabilizing margins (thanks to lower search ad spend growth).Read comments

  42. scottmi

    I think TSLA at 65 at end of week would be just super!

  43. zeroxzero

    Does anyone have Phil's REIT list?

  44. lionel

    Thanks Pharm

  45. wombat

    Phil // Update
    No, not another one – same position with mods. I widened my bull call spread per your advice to Mill and also pushed my short callers up to $150.
    I could kick myslef for not selling half the bull call spreads yesterday but it is what is.
    I rolled the spreads for a $5 credit so they are now $13, correct.

    +40  Jan15 $100/140 Bull Call Spreads ( $5 credit ) / combined P/L +75K
    -20 Jan15 $150 short calls ( sold for $30 – now $18 ) / +23K

    I was going to sell half the spreads this morning but it seems too late now – should I wait until their is a bounce tomorrow or the next ? I was thinking they would at least attempt a comeback being TSAL zealots and all ; >
    I'm also thinking under $110 by back the short $150's, and then sell them again when they bounce.
     

    I was also thinking of after ( if ) they bounce enough to flip the spread bearish ( $140 / 160 ) TOS says 8K in MR.
     

  46. qcmike

    Phil

    Do you think AT&T will buy some of the EU phone companies?

    Any guess on which one or two?

    Thanks

  47. pstas

    AGN- Pharm- was that your play? What do you make of the chart today?

  48. angelcur

    yen strengthening too much..dxj under pressure
    cities in italy being downgraded just now…rome, milan, turin, liquria, sicily
    AAPL TRADING WELL TODAY..AAPL/GLD CORRELATION STRENGTHENING..HA

    RUMORS OF HILLSENRATH ARTICLE LATER TODAY

  49. wombat

    PSW / practice 
    TOS in a bit confusing to me. So I sold short calls for $10, that cash would immediately show up in your Net Liq, or total account balance.
    So if I make a 50% profit, and buy back the calls – my account would be less $5.
    Or, is another way to look at it – someone gave me $10, and I simply gave them back $5 ; >

    How do you guys manage whats really inyour accounts ?

  50. David Ristau

    Phil -

     

    Any news on the new website or Yahoo stuff?

  51. zeroxzero

    Angel:  FWIW, one of the best money manager in Europe [F. Parames, Bestinver] who happens to be Spanish and hasn't touched Spanish equities for a few years now said last week that Spain now offered good value in equities, having undergone substantial internal devaluation [salaries].

  52. newt

    Phil: Thanks. injustice- insanity.

  53. millcreek

    phil,

    if i were to close everything right now i would wind up with a -21k overall.  price roughly 109.50

    if i close everything but leave the sht 150;s then im down 2k. 

    but does it make sense to have sht call w/o sht puts.

    what about leave the sht 150 and close all the 125's and the sht jan 15 95 puts and then sell 10 jan 80 puts for about 7. 

    i would be left w/ 10 sht jan 5 150' s and sht 10 jan 80's.

    the puts have a delta of .20 vs the .45 of the calls so that would still be net bearish…….and reduce my exposure……..not sure if it makes sense.

    i am looking to take a little off the table with todays move…or just close half of puts/ sht calls and half of the 100 long calls…basically leaving me w/ half position except for the 150;s…………..hope it makes sense…………amazing how u keep track ……………your thoughts…………..tks

  54. mrmocha

    PharmTHLD chart looking pretty interesting, I decided to close my covers here and run naked…

  55. newt

    Zero: AGNC, CIM, NLY are what I remember.

  56. angelcur

    as a hedge to the gas gouging we are about to experience…the refiners have pulled back near 200d ma…and crack spread bottoming…up 34 % this week…should be good for bounce as long as market doesn't swoon psx, vlo, tso  france says fin transaction tax to include fx.        brazil mulling another round of tax hikes..that will go over well   more cuts coming too…so the populace is already rioting and another round of govt spending cuts/tax hikes on the way.   and inflation getting out of control..

    ZOZO//THANKS!

  57. angelcur

    it will be like carnevale!

  58. Pharmboy

    AGN/pstas – yes.  Bearish now, but it is Sept 95s and we are 1/2 out.

    THLD/mrm – hummm, insiders are selling and they are rocketing up on no news….so, stock offering in the making??  1/2 naked is ok, full, not quite ready for it.

  59. Pharmboy

    TSLA – my July 110 puts I thought were dead water.  Now I am back to even, and done with that Momo.

  60. Phil

    TSLA/Invest – 26M today vs 10M on a normal day.  Over $105 since 6/27 (13 days) on average volume means there's 130M idiots (shares) bought over $105 and, at this pace, about 1/3 of them will bail on one day and it's taken the stock down 15%.  That's going to leave about 80M idiots who still bought the stock at $105 or better who plus you have to go all the way back to May 23rd to get to $85 (where we bailed) and that's about 25 more sessions at 10M each for 250M but figure most of those people found greater fools at $105+ (giving them the benefit of the doube) and call it "just" 250M total idiots and that means it would take TSLA as much as 5 days of this kind of selling (down 15% in a day) to hit bottom.

    Congrats Philisit!  What a long, strange trip it's been…

    REITs/ZZ – Do I have a list?

    Spreads/Wombat – It's OK, you just went a bit overboard on the coverage but that's normal enough after being burned.  You can just pull 5 of your $100 calls and that leaves you shorter but you're just not very short as it stands.  I agree it's going to be rough and they may bounce up and down $10 a day.  That's why I simply don't touch the Income Portfolio play as we've been waiting for earnings because everything in between is BS and it's a completely ridiculous stock to day-trade based on the fluctuations in PRICE of the stock (which hasn't got a thing to do with it's VALUE).   If you have a net $20 credit per your 40 long $100 calls then all you need is for TSLA to finish under $140 in Jan 2015 and you have 40 x $20 ($80,000) in profit.  So LEAVE IT ALONE FOR 18 MONTHS – is the correct "strategy".  Only if you have a serious concern your upside is being threatened should you do anything at all.  

    Why is it so hard to teach people to NOT do anything????

    Italy/Angel – Interesting that they are doing it in bits and pieces.  Now we have rumors of Hilsenrath rumors – oi vey!  

    TOS/Wombat – Try to focus on what's real and stay so far within your margin that you don't care if they credit you $5 or $10 on any individual position.  If you are worried about your daily net Liq – your problem is too many positions, not the way TOS releases margin!  

    News/David – Yes, we already have a team together to work on a new content aggreggation site and are moving ahead – what happened to you?  

    Spain/ZZ – Doesn't make me want to touch them. 

  61. lionel

    AUD/USD above 92.5c entering a new short (target 85c by Jan 2014)

  62. wombat

    Pharm // AGN
    ??? did you just close half or are you naked on the $100's //

  63. angelcur

    hillsenrath out..
     http://online.wsj.com/article/SB10001424127887324348504578609951521236118.html
     how the hell is that leaked unless somebody is paying a lot for it…no other way

  64. Pharmboy

    Oh am I gonna have some Motley Fool Picks for Vegas…..

  65. Pharmboy

    AGN/wombat – um, Sept 95s.  Aug 100s were PCYC, no?

  66. ariveraA

    Not do anything – Phil/ Hardest lesson I'm learning here.  Thanks.

  67. Pharmboy

    AGN – it was a buy of the Sept 95s on them and the PCYC trade was 100/105s.  We closed 1/2 the PCYC the other day for a free ride.  The AGNs some took 20%, I held and then sold 1/2, saying we would buy back in at 1.70 or so.  Not quite ready yet.

  68. Pharmboy

    I am rolling up my Aug 36 USO Ps to Aug 37s.  Now things are getting interesting on the other TA direction, down.

  69. angelcur

    I HAD NEVER BEEN TO VEGAS BEFORE THIS PAST JUNE WENT OUT ON BUISNESS (SERIOUSLY) AND LOVED IT STAYED AT BELLAGIO CAESAR'S LOOKED GRAND BEHIND IT..WHAT A WONDERFUL SPOT HIKED THE RED ROCK CANON LOVED IT!

    HAVE A BLAST!

  70. Pharmboy

    PETX rocking today.  When do they get options?

  71. Pharmboy

    angel – seriously?  No!

  72. rperi

    Vegas – After the AC conference I am really disappointment not be able to make Vegas.  Sounds fantastic and anyone who chooses to go, it's well worth it.  Seems the hotel isn't much more expensive than we paid in Jersey.

  73. angelcur

    YES BUISNESS MY UNCLES 80TH..(THATS BUISNESS IN OUR FAMILY!)

  74. angelcur

      "zimmerman family suspects obama is tapping their phones"..hahaha…did they think they were special or something?

    BAHAHAHA

  75. yodi

    millcreek

    Phil Made a very good comment this morning in ref. to moving around to much once you have set up your play.

    In deed I do have quite a veriety of TSLA positions The last once added was a 65/165 Jan 14  strangle. The logic on this stock is, it is pumped up to high and it will fall down to a more resonable level. I just sit down have bier in the biergarden and watch then running around like headless chicken.

  76. Phil

    TSLA/Mill – Weren't you down a crapload more than that on Monday?  They just dropped from $133 to $108 in two days.  We think $85 is "fair" so not looking for a lot more drop.  If you leave the short $150s and TSLA pops back to $130 – will you ride it out for a year and a half?  If TSLA drops another $25 to $83, will you be worried about ending up having however many shares put to you at net $95?  If no and no, then nothing wrong with the short strangle but, if you're going to go back into panic mode, why risk it when you can get out with ONLY a $21,000 loss and move on to more productive stocks?  

    For $10,000 you can sell 10 TSLA 2015 $65 puts and you can sell 10 2015 $190 calls for another $11.50 ($11,500) and there's your $21,000 and another $500 for your trouble.   The thing is – do you REALLY want to not only own 1,000 shares of TSLA at $65 (not counting the money collecting as you are behind) and are you willing to DD to 2,000 shares of 2017 $50 puts ($100,000) AND are you REALLY willing to be short TSLA at net $190 and willing to DD the short position to 2017 $225s.  If the prospect of the next logical roll is uncomfortable – don't be in the current position!!  

    TSLA is not a nice, well-behaved stock.  What we originally thought was amusingly erratic when we went long at $35 is VERY annoying at $105-130 so this is not a stock you play casually.  The value of the company is easy enough to determine (about $8Bn) but the PRICE is completely erratic and disconnected from all logic.  You can't play this like an investment – you either have to have tremendous conviction and stick to your VALUATION model or you have to momentum trade it on price but you can't change your mind from day to day based on whatever idiocy takes over the market that day.  

    I love conviction plays – you can make a fortune on them – but only if you HAVE conviction and DON'T over-extend yourself so you are forced to act against your own better judgment.   The last time we moved TSLA in our Income Portfolio was one simple adjustment on 6/27, when they first hit $110 and we took out the short puts and used the profits to roll the short Jan $80 calls to the $92.50s.  Other than that, we simply rode out the storm and here we are, back under $110.  

    That's how you play a stock with conviction – you have to KNOW that a ridiculous move is ridiculous and be willing to deal with the consequences (a disastrous hole in our Income Portfolio in this case) if you are wrong.  If you don't have that conviction – then you should have a 20% stop-loss on your initial position and be done with it!

    The minute you decide not to take that 20% loss on a 1x position, this is the path you are going down – don't take the first step if you are not going to complete the journey.   

  77. Winston

    Phil/PCLN death wish earnings strangle. This stock is better than white powder :) If I look at the Aug 13 900 strangle it is selling for $74.50 – I believe based on a previous discussion this is roughly the move that is expected based on option pricing after earnings.

     

    The August 950/850 strangle is selling for $34.50. Apart from the insanity of the idea, do you see any 'value' in going for a crap shoot on this one, recognizing that the losing side will be rolled out and down?

     

    Permission given to totally crucify me.

  78. zeroxzero

    Thanks, Newt

     

    Phil /Spain:  Not trying to convince anyone at PSW, but, to the extent it matters, there are a number of people whose opinions I respect suggesting that the Euro could take a serious whack, low 1.20s, going forward.  Not surprising, but timing is everything.

  79. Pharmboy

    Very interesting:  The FDA approves the first brain wave test that could help diagnose children and teens with ADHD. Called the NEBA system, the 20-minute test uses an electroencephalogram to calculate the ratio of two brain wave frequencies, called theta and beta, which studies have shown is higher in children and teens with ADHD. The device can be used in patients between the ages of 6 and 17 as part of a complete psychological examination to either help confirm diagnosis or bolster a doctor's decision that more testing for is needed.

  80. Pharmboy

    0X0 – um, I could not agree more (Euro).  When…when…when.

  81. Pharmboy

    FXE Jan14 125s are 1.60.  Time to 'ease' into 'these'.  A few for a rainy day!! :)

  82. Phil

    Refiners/Angel – I think oil rose too sharply for them to benefit into these earnings but, on the way down, the spread should widen nicely.  We should keep an eye on that sector.  

    TSLA/Pharm – Wisely done with, congrats!  

    Hilsenrath/Angel – Thanks.  And, as usual, no arrests will be made!  I like this article, it's pretty well-balanced actually:

    The Fed's plans hinge on economic growth picking up, super-low inflation returning to 2% and hiring staying strong. But the Fed would rethink its timetable if the economy doesn't deliver on these expectations.

    Here are four questions Fed officials are considering as they think about when to pull back on the monetary throttle, and which lawmakers might pose to Mr. Bernanke in the days ahead:

    • Is Job Growth Sustainable?
    • Is the Jobless Rate Overstating the Labor Market's Health?
    • Will Inflation Return to Target?
    • Is More Fiscal Chaos Coming?

    Of course the sub-text is – how can the Fed say definitively that job growth is real and sustainable or that more fiscal chaos isn't coming.  Inflation, however, is here and the Fed is probably at their easing limit without kicking it into high gear so the real question is – how long?  Based on the other 3 questions, the answer is VERY.  

    BUT – that's the expectation and, as I keep saying, what can Bernanke possibly say more than QE Forever and Ever and Ever Halleluja???  So, unless Ben pitches a tent in Congress an holds one MoFo of an old-time revival meeting preaching MORE FREE MONEY and another Trillion in Federal Stimulus – I can't see what's going to add fuel to this fire…

    Nothing/Arivera – At least, once in a while, we do get good examples.  All part of those 10,000 hours because you just can't learn this stuff from reading about it, can you?  

    Red Rock/Angel – I like that place.  Come on out and play with us.  

    LOL Angel – I like that 2nd article.  

    Caesars/Rperi – That's the most Vegas of all the hotels.  My favorite one for playing (eating, shows, gambling).  When I'm there to work, I usually stay at the quieter Mandarin or 4 Seasons but, when I went to Vegas for the first time with the kids – we went to Caesars (and it was a blast for them) and when my cousin came over from England – Caesars.  It's one of those experiences you should have in your lifetime!  

    Beer and TSLA/Yodi – The best strategy! 

    PCLN/Winston – Yes but, as I'm sure Pharm will tell you, PCLN moves more than 10% average on earnings and you are insuring for less.  You ONLY make SOME money if it stays in that range while you can lose a fortune if it blasts out.  Look at TLSA today – what if that's PCLN on earnings and what if most of that move is before you have a chance to adjust.  If you have millions to play with and don't mind the consequences – it's a fun play but, to me, if you are playing a strangle, then you don't have any conviction on the stock and you're not likely to be willing to turn it into a 2-year workout on the bad side, right?  

  83. rperi

    Two questions Phil – for some reason it's escaping me how to find the volume for each of the indices in TOS.  It used to show me in the left hand column under the indices tab, but it doesn't any longer.  What do you use most often to locate this info?

    Secondly, I have a remaining $34 call from a SCO July $35/38 bull call spread, where I sold a $35 put for net $.35.  I bought back the short call when it dropped to $.65, then sold it again for $1.52, for a new net credit of $.52.  I bought that new call back for $.25 on the last rise in oil, rolled the $35 put to the Aug $34 put for $.15 credit, and rolled the $35 call to the Aug $34 call for $1.15, for a new net of $.73.  The $34 call is now $.47.  Would you advise rolling the call down in strike to say $30 for $1.10 and selling something like an Oct $33 call for $1.70 and rolling the short put out to Oct for $1.00?

  84. Pharmboy

    PCLN/Winston – yeap, I will tell you:  PCLN moves more than 10% average on earnings and you are insuring for less.  You ONLY make SOME money if it stays in that range while you can lose a fortune if it blasts out.  Look at TLSA today – what if that's PCLN on earnings and what if most of that move is before you have a chance to adjust.  If you have millions to play with and don't mind the consequences – it's a fun play. 

    Otherwise….no thanks.  LOL.  PCLN.  No play 4 me.

  85. Phil

    Euro/ZZ – How could I disagree with that.  It's a currency based on a seriously flawed monetary union where various parts (member states) are in various stages of collapse and the Central Government (such as it is) does not have the will or the ability to make the sacrifices necessary to hold it together.   This is like having trauma occur to a limb and, rather than the body send blood and nutrients to it and sacrifice itself to make repairs (sometimes resulting in comas or unconsciosness), it instead sends a team over to teach the wounded limb the joys of austerity.   The only reason it hasn't collapsed is BECAUSE the US and Japan are printing money like maniacs and they are practicing austerity so the Euro is RELATIVELY strong as a medium of exchange – but don't confuse that as an indicator on the strength of the undertlying union – that will eventually bring the currency down in any event.  

    Brain scans for everybody!  That is very good news Pharm – tell the NSA to open up a new file-room…

    Volume/Rperi – I don't look on TOS.  I use either my ETrade Pro or Yahoo Finance has a history button that shows you daily volume – which is what I just used for TSLA discussion above. 

    AAPL coming back to $430 again.  

  86. Pharmboy

    Hum….AAPL….hum….440 plz. Purdy plz with strawberries on top?

  87. Pharmboy

    Brain scans Phil….done.

  88. Pharmboy

    Dontcha think that is why the US and Japan have turned up the printing presses….to keep the EU up and let them die a slow, death with chemo…?

  89. Pharmboy

    DIA July 152 puts for 20c.  The 151s are 10c, so a move is a'comin'.  Placing my bet.

  90. Phil

    XONE having a bad day! 

    ExOne downgraded by BB&T Capital Mkts

    3-D Printer Stocks Are Getting SlammedBusiness Insider

    Bubble Stocks Taking A Hitat Seeking Alpha

    On the whole, we're dumping a lot of Momos today and trhe markets aren't taking much of a hit.  Maybe it's anticipation of Bernanke saving us and early profit taking on the things that will collpase first if he doesn't.  

    Dollar 82.60 has been lower and lower all day and NOT helping to hold things up.  

    Oil still around $105.75 and gold $1,291 and TLS $108.60 and the VIX is only 14.51 so no real panic here (except for people who own these momos!).  

    On the upside – GOLD!!! 

    Original_14616475

    Original_14616669

    LOL Pharm!  

    Chemo/Pharm – The cure that kills?  Hard to say.  I don't think the US or Japan thinks EU austerity is a good idea.  We want them buying stuff, even if it kills them vs not buying stuff, even if it kills them. 

    I like that DIA flyer – could be nice winner. 

  91. mrmocha

    Pharm / THLD – Good catch, thanks!

  92. Pharmboy

    mrm – ur gonna be in Vegas this year…no ifs ands or buts….MisteR.

  93. zeroxzero

    Phil:  What might add fuel to the fire is falling inflation expectations in the U.S. on a rising dollar.  I don't think inflation is "here", quite.  U.S. employment has risen over the last six months, while unemployment continues to rise in Peripheral Europe.  Germany, which has also slowed, seems to less keen on austerity these days, with China import cuts not helping,  If inflation were really threatening – despite centrals banks have cut rates to the limit — gold wouldn't be where it is, I wouldn't think.  Short story, stronger dollar, U.S. leads the world out of recession, go team!!  U.S. equities, on the other hand, I dunno.  So I bought Spain.

  94. Winston

    PCLN earnings: Phil/Pharm – LOL – do I take it that Phil is Pharm or Pharm is Phil. When will we three meet again !!!!!!!!!!!!!!!!!!! A silver dollar says this will be the first time that PCLN stays bang where it is after earnings are announced. I will provide the humble pie.

    I love this place.

  95. zeroxzero

    Billy Idol coda: "there's nothing sure or pure in this world."

  96. Pharmboy

    or Zero:  Dancing with Myself…eh, eh….  now it is in your head for the day.  UR welcome.

  97. Phil

    Another super-light day – 105M on the Dow final.  If people were heading for the exits, not many managed to get out today! 

    Inflation/ZZ – I think you have to ignore gold as it's artificially depressed.  I'm fairly sure the scam is to drive all the weak hands out of metals (mission accomplished) so the Banksters can take to up to the inevitable test of $2,000 as the velocity of money begins to pick up.  The banks know when they are going to start lending that massive pile of cash they are sitting on – once it starts going, there's no easy way to stop it.  This was the crux of what I explained on day one in Atlantic City actually.  We're simply playing out the summer scenario we expected back in April so far – only with gold taking a bigger dive than we thought.  

    PCLN/Winston – Ah the old Max Pain theory.  Who am I again?  

  98. deano

    Vegas – I'm in and recruiting – Savi – do you need an email?

  99. Winston

    WHOAMI/ The only thing I know is you are not Jabobeast! and where is he when you need him?

  100. Phil

    Vegas Recruiting/Deano – Yes, we don't really have an upper limit, Caesar's will be happy to give us a bigger space and more food as we're using a weekend – which they love.  In fact, if we fill this year, next year maybe we do a bigger one and allow the public to come for huge amounts of money to subsidize what the Members pay!  

    Was just looking at what I said Friday about TSLA and, based on this comment alone – people should come see me in Vegas just for the psychic readings:  

    TSLA/Wombat – You could do that, convert the profits from the bull call spread into a bear put spread but, of course, your best case is no profits and a long, long time to tie it up.  How about taking the loss, moving on and making dozens of sensible plays for the next 18 months instead?   I very much doubt they get a good drop until next week (15th) when they officially go in the Nas and, even then, they could still squeeze higher first. 

  101. Phil

    Jabob/Winston – LOL, was it really only yesterday when I blasted him in the morning Alert (and the post, for that matter) and he said:

    Am I giving you a little grief? Maybe. Only because I can't wait to see the "I told you so" post when GDX,ABX,and AAPL do well and PCLN,NFLX, and TSLA fail. Unfortunately, it has been many months of pain seeing the opposite (not your fault, of course).

    As I'm sure you guys know, I've been telling him NOT to short PCLN for ages and we're still waiting for NFLX to get real but, on the whole, I think I can now say (30 hours later) – I told you so!!!  8-)  

  102. Lincoln

    Phil: TSLA

    shocking to see it drop like that, kind of like the roadway halfway down our mountain today.  This where we spend the summers

    http://www.wsoctv.com/news/news/local/mudslide-destroys-part-highway-avery-co/nYrsF/

  103. cturb

    Hi Phil. If I have some shares of apple I bought today at around $428 what calls would you sell to protect?  Got out of tsla today. Shorted at $124 and watched it go to $132 and had a heart attack. Covered at $123 so missed the big drop but at least I will sleep ok. What a crazy stock. I have a friend who owns one and she practically wanted to strangle me when I told her stock was overvalued. She kept saying Elon was going to save the world. Really annoying

  104. zeroxzero

    I doubt that I feel anything more than normal skepticism toward your run-of-the-mill conspiracy hypothesis, simply because most humans can barely set their watches to the same time and keeps their mouths shut, much less conspire on a global scale regarding anything at all.  There is always a powerful incentive to profit by being the whistle blower, for one thing.  Gold specie, plus mining stocks  — China, Germany, Brazil,  South Africa, Bernanke and Putin --  all working together to drive gold down?  It doesn't sound right, somehow.

  105. stjeanluc

    Been away the entire day but we are still not getting the down day we need on the indices!

  106. stjeanluc

    Car sales are going in the opposite directions in Europe and the US:

    http://www.bespokeinvest.com/thinkbig/2013/7/16/us-and-european-auto-sales-are-oceans-apart.html

    This morning's release of auto sales for the month of June shows that even though the idea of globalization says economies are more intertwined than ever before, it doesn't mean that they now all move in unison.  The chart below shows the trailing 12-month total of new car sales in the United States versus Europe going back to 1993.  In recent years, auto sales in the US have seen a sharp rebound even as sales in Europe have been sliding.  In fact, while the total number of new cars in the US in the twelve months ending 6/30 hit its highest level in five years (15.0 mln), sales in Europe dropped to their lowest levels since December 1995 (12.1 mln)!  

  107. revtodd64

    Sears – Interesting article on how Lampert applied Ayn Rand principles to Sears, believing it would spark healthy innovation.  Instead it bred a culture of conflict and backstabbing (who knew that would happen when you encourage people to act selfish for the good of all?)  

    Plagued by the realities threatening many retail stores, Sears also faces a unique problem: Lampert. Many of its troubles can be traced to an organizational model the chairman implemented five years ago, an idea he has said will save the company. Lampert runs Sears like a hedge fund portfolio, with dozens of autonomous businesses competing for his attention and money. An outspoken advocate of free-market economics and fan of the novelist Ayn Rand, he created the model because he expected the invisible hand of the market to drive better results. If the company’s leaders were told to act selfishly, he argued, they would run their divisions in a rational manner, boosting overall performance.

    Instead, the divisions turned against each other—and Sears and Kmart, the overarching brands, suffered. Interviews with more than 40 former executives, many of whom sat at the highest levels of the company, paint a picture of a business that’s ravaged by infighting as its divisions battle over fewer resources. (Many declined to go on the record for a variety of reasons, including fear of angering Lampert.) Shaunak Dave, a former executive who left in 2012 and is now at sports marketing agency Revolution, says the model created a “warring tribes” culture. “If you were in a different business unit, we were in two competing companies,” he says. “Cooperation and collaboration aren’t there.”

  108. Savi

    LV Note—-please e-mail me directly if you are commiting or have questions --I am in and out on the site during the day and I miss some of the comments --thx

    atm count 8 (incl deano) with 2 pending

  109. jabobeast

    Phil—way to get it back!!

    I have been waiing impatiently, of course ;-)

     

    http://i.qkme.me/35do3d.jpg

  110. stjeanluc

  111. scottmi

    Elon/cturb – save the world!?  Hah! ask your friend if he is going to save it, why is he trying to get OFF the planet and go to Mars (on a one way trip!)? Also piont out he has no kids..  hardly shows he has much commitment to mother Earth. LOL!

  112. zeroxzero

    Having expressed my doubts about a "gold conspiracy" earlier, it is only fair that I reproduce this item that appeared in the Times this evening: 

     

    Patrick Hosking Financial Editor

    Published at 12:00AM, July 17 2013

    "A suspected attempt by City traders to rig the Bank of England’s flagship policy to stimulate the economy has been under investigation for almost two years, it emerged yesterday.

    Paul Fisher, the director of markets at the Bank, told MPs that details of a “reprehensible” attempt to manipulate the government bond market had been passed on to regulators.

    The affair was looked at initially by the Financial Services Authority and continues to be under investigation by the Financial Conduct Authority, it is understood.

    Officials believe that traders tried improperly to push up the price of a particular gilt in October"

  113. zeroxzero

    And this, from FT: oh dear:

     

      "The US electricity market’s overseer has slapped Barclays with a record $470m penalty over manipulating power prices, in the latest heavy regulatory sanction against the UK bank.

    The Federal Energy Regulatory Commission’s fines matched the amount proposed last year when it accused four former Barclays traders of manipulating physical power prices in California and other western US states in order to fraudulently boost financial derivative positions."

  114. zeroxzero

    Finally — inflation/deflation:  Given that the Chinese are executing shadow bankers, it may be that their authorities are actually serious about limiting inflation:  http://www.bloomberg.com/news/2013-07-16/-shadow-banker-execution-turns-chinese-sentimental.html

  115. scottmi

    Water meme continues..

  116. Phil

    Good morning!

    BCS with a half Billion Dollar fine for manipulatiing energy markets!  8-)  

    The evidence “demonstrates that the intentional amassing of the positions and trading to influence price were not based on normal supply and demand fundamentals, but rather on the intent to effect a scheme to manipulate the physical markets in order to benefit the financial swaps,” the agency wrote in its order. Swaps are derivative instruments used to hedge risks or for speculation.

    This sets a very nice precedent to go after the rest of the bastards but I'm not sure the US is going to charge US companies.  In fact, I think this may be the US manipulators kicking out a competing manipulator.  

    Congress in 2005 granted the agency additional enforcement powers, including the ability to fine violators as much as $1 million a day, after market manipulation by traders for Enron Corp (ENRNQ). triggered rolling blackouts in California. In some cases, including its probe of Frankfurt-based Deutsche Bank (DBK), FERC has reached a settlement with the companies it is investigating.

    Also very good news – slowly but surely my issues are being addressed!  Never think it doesn't help to write your Congresspeople, we've been agitating for this and, now that their exemption is up for review, it's being taken seriously: 

    US Senate to hear on bank ownership of commodities storageA U.S. Senate committee will hold a hearing next week on whether banks should control physical storage for commodities, signalling lawmakers may be toughening their stance on the controversial but lucrative business for giant Wall Street firms. 

    Meanwhile, we've had a 0.25% sell-off in the Futures and, as expected, the RUT is getting hit harder than the rest.  The Dollar bounced off 82.50 and back to 82.76 at the moment. 

    Oil $105.24, gold $1,284 after being rejected at $1,290, silver rejected at $20 and now $19.74, copper DOVE from $3.20 to $3.139 at 1:30 so I need to figure out what caused that (assume China GDP), nat gas flat at $3.659 and gasoline rejected at $3.15 and took it poorly, now $3.089.

    As expected, the API report flipped as demand wasn't there to suck up the increased supply caused by cracking all those holiday barrels:

    Earlier Wednesday, the American Petroleum Institute said U.S. oil inventories fell 2.6 million barrels for the week ended July 12. Analysts expected a decline of 2.5 million barrels. Gasoline stockpiles rose 2.6 million barrels while distillate stocks jumped 3.8 million barrels. 

    TSLA continued to dive after hours and Motley Fool has gone into overdrive trying to pump it back out – unfortunately, no arrests will be made:

    We're starting to get real earnings reports and it's time to switch our brains back on and look at reality again. Monday was terrible, with 5 or 8 missing but yesterday only 3 of 19 missed (SCHW, WABC and MRTN) with 3 flat but KO, MOS, RECN and YHOO had lower revenues and made their money by cutting back spending – not a good overall economic signal…  We'll see how today's batch fares: 

    Notable earnings before Wednesday’s openABTASMLBACBKFCFSFRCGWWIGTEMATMTB , 

    NTRSNVSPNC,STJTXTUSB

    Notable earnings after Wednesday’s close: ALBAXP,CCKCLBCVAEBAYEPBIBMINTC

    KMP , NEPLXSRLISCSSSLMSNDK,STLDVMIXLNX

    So, lots of biggies today and, of course, the Bernanke on the Hill AND the Beige Book.  

    Day after day,

    Alone on a hill,

    The man with the foolish grin is keeping perfectly still

    But nobody wants to know him,

    They can see that he's just a fool,

    And he never gives an answer

    the fool on the hill

    Well on the way,

    Head in a cloud,

    The man of a thousand voices talking perfectly loud

    But nobody ever hears him,

    or the sound he appears to make,

    and he never seems to notice,

    the fool on the hill,

    And nobody seems to like him,

    they can tell what he wants to do,

    and he never shows his feelings,



    But the fool on the hill,

    Sees the sun going down,

    And the eyes in his head,

    See the world spinning 'round.

    Wednesday's economic calendar:

    7:00 MBA Mortgage Applications

    8:30 Housing Starts

    10:00 Hearing: Semiannual Monetary Policy Report (Bernanke)

    10:30 EIA Petroleum Inventories

    2:00 PM Fed's Beige Book

    4:23 AM European shares (FEZ) are flat-to-higher ahead of Ben Bernanke's testimony to Congress this week. "If Bernanke is saying it's OK to taper, growth is coming through, don't worry about it, then that's actually fine for equity markets," says HSBC's Anna Edwards. EU Stoxx 50 +0.2%, London +0.5%, Paris +0.2%, Frankfurt +0.3%, Spain and Italy flat.

    6:00 AM Overseas: Japan +0.1%. Hong Kong +0.3%. China -1.1%. India +0.5%. London -0.4%. Paris -0.5%. Frankfurt -0.6%.

    The prepared remarks for Ben Bernanke's Humphrey Hawkins testimony tomorrow will be released 90 minutes ahead of the usual time – 8:30 ET instead of 10 ET. The early release will give House Financial Committee Members the opportunity to review the testimony, with the hearing and Q&A session set to begin at the normal time of 10. Maybe we'll get some better questions?

    Wild Cards for the Fed's Exit StrategyInflation, Jobs and Fiscal Policy Among the Question Marks. The Federal Reserve's plans to wind down its big bond-buying program depend on solving four economic puzzles involving the job market, the inflation rate and fiscal policy. Fed Chairman Ben Bernanke gets another chance to clarify the central bank's thinking when he testifies before Congress on Wednesday and Thursday, after weeks of market volatility generated largely by confusion and uncertainty about the Fed's plans.

    The Fed Is The Problem, Not The Solution: The Complete Walk-Through.

    About That "Incomes Are Rising" Claim... (graphs)

    OECD fears jobless threat to social fabric as Europe left behindThe unemployment gap between the US and eurozone states will reach the highest levels in modern history next year, according to a report by the OECD.

    What?  No MORE free money???  The Bank of England's Monetary Policy Committee voted unanimously to keep interest rates at 0.5% at a meeting earlier this month and against more quantitative easing, the minutes show. This was Mark Carney's first vote after becoming BOE Governor. The pound spikes as is +0.4% at $1.5221, while the FTSE takes a dive and is flat after being +0.5% not so long ago. ETFs of interest areFKUEWUEWUSDXPSGBB and FXB. (PR)

    As expected, U.K. unemployment falls to 7.8% in March-May from 8% in December-February. Average weekly earnings excluding bonus +1% vs +0.9% prior and consensus of +1.1%. The number of unemployed -57,000 to 2.51M. Inactivity rate +0.2 percentage point to 22.5%. Claimant count -21,200 in June vs -16,200 in May and -8,000 consensus. Claimant count rate unchanged at 4.5%. (PR)

    Bank of Portugal Lowers 2014 Growth Forecast on Budget Cuts.

    Greek Coalition Government Faces Parliament Test Over Job Cuts

    Egypt’s Brotherhood Plans Mass Protests After Rejecting Cabinet

    Japan’s ‘kamikaze’ economics risk Asia debt crisis. Commentary: Abe’s nationalistic reforms will have a global impact. “Abenomics,” the efforts of Japanese Prime Minister Shinzo Abe to revive Japan’s moribund economy, has important implications outside of Japan.

    China's foreign direct investment rose at the fastest pace in over two years in June, climbing 20.1% to $14.4B as investors demonstrated confidence in the country despite slowing growth. In H1, FDI increased 4.9% to $62B, with FDI from the U.S. +12.3% to $1.8B and from Europe +14.7%. The Commerce Ministry expects FDI to remain "relatively stable" in H2. 

    China’s Structural Shift in Economy Poses Risks, Jain Says. Deutsche Bank AG (DBK) co-Chief Executive Officer Anshu Jain said Chinese policy makers’ efforts to bolster domestic consumption and reduce dependence on the government’s infrastructure spending poses some risks. “It’s the right strategy for them in the long run,” Jain said in an interview with Bloomberg Television’s Haslinda Amin today in Singapore. Still, “if there is something to watch closely in China, it would be the implications of that shift from infrastructure spending.” 

    Just Four China Charts. ?

    Singapore Exports Fall 8.8% in Longest Slump Since Global Crisis. Singapore’s exports in June extended the longest run of declines since the global financial crisis, suggesting the island’s economic growth last quarter may be lower than the government initially estimated. Non-oil domestic exports slid 8.8 percent from a year earlier, falling for a fifth month, the trade promotion agency said in a statement today. The median of 17 estimates in a Bloomberg News survey was for a 5.8 percent dropThe decline in electronics demand is unlikely to turn around,” Irvin Seah, a Singapore-based economist at DBS Group Holdings Ltd., said before the report. “External headwinds remain strong. Data from the U.S. have been mixed and Europe is still stuck in recession.” 

    Fitch Downgrades Pennsylvania's GO Bonds to 'AA' from 'AA+'; Outlook Remains Negative. Fitch Ratings has downgraded the rating on $10.9 billion in outstanding commonwealth of Pennsylvania general obligation (GO) bonds to 'AA' from 'AA+'. In addition, Fitch downgrades the ratings on bonds supported by commonwealth appropriations that are listed at the end of this release. The ratings on the appropriation-backed securities are linked to the commonwealth's GO rating. The Rating Outlook is Negative. 

  117. revtodd64

    Interesting take on Bernanke's testimony this morning, though I'm hard pressed to think who in Congress is going to come up with these pointed questions:

    The economic calendar for Wednesday is headlined by the Bernanke testimony to the House and the Fed Beige Book. Something new is happening to the testimony. The House Financial Services Committee requested the text of Bernanke's comments ahead of the actual testimony so they could prepare questions. The Fed is going to release the Bernanke comments at 8:30 with the actual testimony to start at 10:00. I believe this is going to open Bernanke up to an onslaught of pointed questions that could produce some unwanted results.

    Remember, Bernanke is assumed to be a lame duck whose term expires on January 31st. He really has nothing to lose by being blunt in his comments over the country's fiscal problems. He has been blunt in the past about the amount of drag the government is inflicting on the economy. This could turn into a hostile testimony since lawmakers have 90 minutes for their staff to come up with questions designed to embarrass Bernanke and give the lawmaker a sound bite to use in his next election campaign.

  118. Phil

    U.S. District Judge David Carter yesterday ruled that the federal government can press ahead with its $5B civil fraud lawsuit against S&P for allegedly misleading investors with its credit ratings. The government has accused the McGraw Hill (MHFI) unit of inflating its ratings so it could win more fees from the customers that pay for them. It's all "puffery," says S&P. 

    In a move "broadly based on proposed antitrust deals" with Visa (V) and MasterCard (MA), the EU proposes a cap on credit and debit card processing fees of 0.2% to be implemented after a two-year "transition period" during which the ceiling will only apply to cross-border chargesFT says. The move is expected to result in a €4.5B reduction in fees, according to the European Commission. V-1.32% and MA -1.66% AH

    Why Goldman Sachs(GS) earnings weren't all that: trader.

    First Cash (FCFS): Q2 EPS of $0.53 misses by $0.03. Revenue of $143.135M misses by $6.71M. (PR)

    Gas Prices Surge Toward $5 in California.

    Chevron (CVXstrikes a deal with Argentine oil/gas producer YPF to develop shale oil/gas assets in Argentina's Vaca Muerta formation. The companies will invest $1.24B in the project's first phase, which will include drilling 100 wells. Chevron says the deal gives it a chance to grow production beyond its 2017 target of 3.3M barrels/day.

    Staff lawyers at the California Public Utilities Commission want to impose penalties of over $1.9B on utility PG&E (PCG) for its role in a fatal natural-gas pipeline explosion in San Bruno in California in 2010, as well as a fine of $300M. An earlier proposal had called for the utility to pay the same amount but no fine, which lowered PG&E's costs on an after-tax basis. PG&E has set aside $200M to cover the fine and has forecast that overall outlays could hit $4B.

    Gold (GLD +0.4%) gains again, sending the price to a 3-week high of $1,290/ounce and the miners (GDX +4.2%), (PSAU+3.3%) are responding. "Never let a serious crisis go to waste," says the JPMorgan team, paraphrasing Rahm Emanuel. The bear market is forcing managements to not only cut costs, but to consider restructuring from "a shape that was optimized for the 12 year bull market in gold to one that is more suited to a future with less available liquidity." Barrick (ABX +5.2%), Goldcorp (GG +3.9%), Gold Fields (GFI +4.4%), NovaGold (NG +3.2%). Don't forget the silver miners (SIL +3.1%): Hecla (HL +4.5%), Silver Wheaton (SLW +3.9%), Coeur (CDE +5.8%).

    Despite stifling bureaucracy, inefficiency, corruption, major disputes with joint venture partners, a bloated workforce and freezing temperatures, International Paper (IP) has invested a company record $1.2B into a pulp mill in the Siberian city of Bratsk. IP has overcome many of the problems and costs are low, while the prize is the massive Chinese market, which is linked to Bratsk by rail.

    CSX(CSX) posts bigger quarterly profit as intermodal stays strongCSX Corp posted a bigger quarterly profit as the company continues to see benefits from its intermodal business, offsetting a fall-off in coal volumes.

    Tesla(TSLA) shares slammed on Goldman's low price target?

    As Consumer-Discretionary Stocks Surge, Bears LurkSome Investors Tread Lightly Amid High Valuations. Companies whose fortunes are tied to consumer spending have been big winners in the stock market thanks to greater confidence about the U.S. economy. Now, some investors are wondering if the rally has gotten ahead of itself. Consumer-discretionary stocks—which include travel companies, auto makers, restaurants and retailers—are trading at some of their highest valuations in nearly four years.

    The restaurant sector sees a ton of sell-side activity today with Stifel initiating Yum Brands (YUMprevious) and Domino's (DPZ-0.7%) as Buys and McDonald's (MCD -0.2%), Panera (PNRA-0.5%), Starbucks (SBUX -0.5%), Chipotle (CMG -2.3%), Noodles (NDLS -2.8%), and Buffalo Wild Wings (BWLD -3%) as Holds (BWLD also downgraded by Baird). Baird also cuts Chuy's (CHUY -5.9%) to Hold. Bloomin' Brands (BLMN -0.8%) and Texas Roadhouse (TXRH-0.9%) are cut to Hold at JPMorgan. 

    No toys??  That's not good:  Mattel (MAT): Q2 EPS of $0.21 misses by $0.11. Revenue of $1.17B misses by $0.05B. (PR) 

    Shares of Billabong (BLLAY.PKBLLAF.PK) soar down under, rising 38% on the ASX after the company secures $364M in financing and says it will replace its CEO. The package includes $300M in bridge financing (at 12%) and $64.65M for DaKine, Billabong's backpack brand.

    China's State Food & Drug Administration is carrying out asix-month crackdown on the sale of illegal medicines and tightening regulation, increasing pressure on the sector amid probes into bribery at GlaxoSmithKline and price-fixing at several major multinational and domestic companies. "Corruption is so entrenched in the pharmaceutical space that…to get things done you have to bribe officials," says industry watcher Yanzhong Huang. That's despite China executing its chief drug regulator six years ago for taking bribes to approve fake medicines.

    Michael Dell and Silver Lake are "prepared to see [their] deal blow up" rather than raise their bid above $13.65/share, sources tell AllThingsD's Arik Hesseldahl. Concerns about Dell's (DELL) PC business and rising borrowing costs are said to underpin their reluctance to pay more. As it is, Bloomberg reported earlier this month Silver Lake's commitment to the deal was wavering. Meanwhile, a source tells Fortune's Dan Primack Dell's special committee believes ~15% of shares will qualify as absentees, which are effectively "no" votes. (previous)

    leaked image appears to provide full specs for the BlackBerry A10 (BBRY -1.8%): the image indicates the A10 will sport Qualcomm's (QCOM) dual-core MSM8960 processor (same as the Z10), a 5" 720p display (many high-end Android phones now have 1080p displays), 16GB of storage, and an 8MP rear camera and 2MP front camera. BGR provided a few details about the A10 last week, while adding it's the only completely new BB10 phone set to launch in the remainder of 2013

    Mark Zuckerberg Runs A Giant Spy Machine In Palo Alto, California. Mark Zuckerberg runs a giant spy machine in Palo Alto, California. He wasn’t the first to build one, but his was the best, and every day hundreds of thousands of people upload the most intimate details of their lives to the Internet. The real coup wasn’t hoodwinking the public into revealing their thoughts, closest associates, and exact geographic coordinates at any given time. Rather, it was getting the public to volunteer that information. Then he turned off the privacy settings.

    More on Yahoo: Q2 revenue ex-TAC -1% Y/Y vs. flat in Q1. Display ads remain weak following new leadershipnew ad formats, and a home page revamp: sales -11%, same as Q1. Exc. Korea, display ads sold -7%, ad prices -2%. Search (aided by Microsoft payments) is better: exc. Korea, ad sales +5% (was +6% in Q1). A 21% increase in search paid clicks offset an 8% drop in price/click.$653M spent on buybacks vs. $775M in Q1. Cash/investment balance -$600M Q/Q to $4.8B. Sales/marketing spend +3% Y/Y and G&A -1%, but R&D +18% (new investments). YHOO -2.2% AH, CC at 5PM ET, replete with live video (webcast). (PR)

    Yahoo (YHOO) delivers guidance through a slide deck released following its Q2 report. The company expects Q3 revenue (ex-TAC) of $1.06B-$1.1B, below a $1.12B consensus, and 2013 revenue of $4.45B-$4.55B vs. a $4.53B consensus. 2013 adjusted EBITDA is expected to total $1.55B-$1.65B, below 2012's $1.7B, and 2013 non-GAAP operating income is pegged at $900M-$1B. Americas revenue (73% of total) +2% Y/Y in Q2, EMEA -8%, Asia-Pac -8%. Headcount was 11.5K at quarter's end, down 1.1K Y/Y but up 200 Q/Q. Shares -2.2% AH. (Q2 results: III)

    Wow!!!  Alibaba's Q1 revenue rose 71% Y/Y to $1.38B, and its net income rose 203% to $669M, Yahoo (YHOO) discloses following its Q2 report. Alibaba posted revenue of $1.84B (+80% Y/Y) and net income of $642M in seasonally strong Q4; margins improved greatly in Q1. CFO Ken Goldman states on the CC Yahoo is still exploring how to monetize its 24% Alibaba stake with little tax impact. Marissa Mayer says Tumblr has been adding 250K blogs/day post-acquisition, and that Yahoo needs more video content. "Our video [ad] inventory sells out months in advance, which is not a good thing." Will Yahoo go after another target, now that Dailymotion and Hulu are off the table? Shares rebound, now +0.1% AH. (Q2: IIIIII) (live blogs: III) (slides)

  119. Phil


    Google (GOOG -0.6%) has approached TV network ownersabout offering a Web-based TV service, the WSJ reports. Intel (INTC) has similar ambitions, and has unsurprisingly run into opposition from pay-TV providers looking to maintain the status quo. Moreover, a newcomer such as Google (or Intel) will likely have to pay steeper prices than incumbents. But if Google manages to get such a project off the ground, YouTube could prove a powerful delivery/marketing vehicle, and provide an effective way to bundle online video. If it fails to launch, there's always Google Fiber.

    Apple (AAPL) roundup: 1) Russia's top 3 carriers – MTS (MBT), VimpelCom (VIP), and Megafon – have decided to stop carrying the iPhone, citing Apple's purchase, subsidy, and marketing requirements. MTS and VimpelCom have 300M+ subs between them in various emerging markets. 2) Fingerprint sensor and LCD driver chip yield issues will lead ~3M iPhone 5S units to be delayed from calendar Q3 to Q4, Digitimes reports. 3) Frost & Sullivan estimates Apple TV had a 56.1% share of the 2012 IP streaming device market. 4) Evercore observes rumored M&A target PrimeSense has developed tech that's applicable to gaming and smart TV controllers, as well as a sensor chip for notebooks/tablets. (iOS 7/game controllers: III)

    Republicans Get Filibusted. Democrats end the 60-vote Senate rule for presidential nominees. Senate Majority Leader Rich Trumka, er, Harry Reid held a gun to the head of Republicans on the filibuster, Republicans blinked, and President Obama and the AFL-CIO will now get their nominees confirmed for the cabinet and especially a legal quorum for the National Labor Relations Board. Cut through all the procedural blather and that's the essence of the Senate's "deal" Tuesday over the 60-vote filibuster rule. While Democrats didn't formally pull the trigger of the "nuclear option" to allow a mere majority vote to confirm nominees, they have now established a de facto majority-vote rule. Any time Democrats want to do so, they can threaten to pull the majority trigger.

  120. BruceE

    Any oil bets today?  

  121. Phil

    Landslide/Lincoln – Wow, you guys sure know how to pick a vacation spot!  

    AAPL/Cturb – I would not own AAPL at $428.  Why should you?  The dividend is just $12.20 (2.9%).  Already you want to hedge it so why not just sell the stock and sell the appropriate number of 2015 $350 puts for $28 and use that $28 to buy the 2015 $420/500 bull call spread ($28) as that pays you all of an $80 gain from here but, if AAPL fails to hold $400, even if you don't stop out of the bull call spread, you still only have a net entry at $350, which is down about 20% from here.  So you have a free 20% protection and 20% upside and you should tie up less margin as well.  Nice job getting out of TSLA – if a stock is not for you – don't play it.  Wise decision. I agree, it's pretty cultish.  

    Conspiracies/ZZ – But right above, in the news is a conspiracy by BCS to manipulate the energy market.  Just like the conspiracy by Enron to do the same.  What is organized crime but a conspiracy to control illegal activities in a certain region?  911 was a conspiracy – no matter who you think was actually behind it – it seems to have worked.  WMDs were a conspiracy to drive us to war with Iraq – also very successful.  Conspiracies happen all the time and the culture of iBanks is like a fraternity (or the Mob), no one gets in on the real shenanigans until they prove themselves worthy of trust and the repurcussions for breaking that trust are probably more in line with the kind of punishment you'd expect from the Mob, rather than a fraternity.  

    Also, by the way, my main conspiracy theory is that you don't need an actual conspiracy to achieve most economic goals.   You simply need the proper incentives and the self-interest of others will take care of the reast.  So, if just me (say, Kenny Lay) has just one friend (say George Bush) and we work together to get a law written a certain way – then "market forces" takes care of the rest for us.  The other people don't need to be in on the conspiracy, such as meeting in dark rooms etc – they just have to have their interests aligned well enough with yours that they will act the way you need them to.

    Also, if you really want to understand how conspiracies work, get yourself invited to the Pine Valley Golf Club in NJ.  It's nothing more than a place Billionaires and CEOs get together on the course and in the clubhouse to determine the fate of the World in a place where no strangers or press are allowed.  Is it a conspiracy or just lunch?  

    SHLD/Rev – I think the mistake people make with Sears is thinking Lampert is trying to save it.  He's not, he wants to destroy it but, in order to kill one of the most beloved classic American brands without being branded a bastard, he needs to make it look unsavable first.  Then he can happily sell off the parts (mostly real estate) and cash out.  Also, of course, as he's driven the stock down, he's increased his own holdings (at least 56.5% now).  In fact, he just re-did his compensastion package to give him 10,000 shares of stock per month as payment for just staying on and converted his salary ($2M) to another 50,000 shares.  

    Thanks Jabob – Your approval is all I strive for!   

    Meanwhile, markets did a big U-turn and back to even now.  Not the Dollar…

    BAC had nice earnings and Mortgage Applications were only down 2.6% this week, finally slowing the relentless slide.  However, builders are slowing down 15%, and that's very bad:

    RECENT TRENDS IN BUILDER APPLICATION SURVEY

     

    MBA’s Builder Application Survey data for June 2013 shows that mortgage applications for new home purchases decreased by 15 percent relative to the previous month.This change does not include any adjustment for typical seasonal patterns.

     

    By product type, conventional loans composed 67.3 percent of loan applications, FHA loans composed 17.4 percent, RHS/USDA loans composed 1.9 percent and VA loans composed 13.4 percent. The average loan size for new home purchases decreased from $283,795 in May to $283,000 in June.

     

    Utilizing information from the BAS, as well as assumptions regarding market coverage and other factors, MBA estimates that sales of new single-family homes were running at a seasonally adjusted annual rate of 413,000 in June 2013.  On an unadjusted basis, the MBA estimates that there were 39,000 new home sales in June 2013.

    Big Chart – One day does not a reliable turn signal make. 

    Inflation/ZZ – You'd be serious about limiting it too if there were 70M of you (CPC) and 1,300M of THEM – who get cranky when they are hungry…

    Water/Scott – When we were kids – we didn't drink this much liquids, did we?  I think driking liquids is addictive and, the more you have, the more your body is used to having and the more you want.  I just seem to remember taking very long car trips and spending days in the woods with just a canteen, which was plenty for a normal day.  

    Now people drink 3 giant cups of coffee (that's another thing, remember how small cups used to be?) and juice and soda and there's water coolers, etc….  I think it's a general marketing thing that has worked to boost our consumption of liquids so they can be sold to us in various forms.  

    Maybe I'm remembering it wrong or maybe it's another "crazy conspiracy theory" but it just seems strange to me that we survived for thousands of years without having to stop for a SBUX every 10 blocks and now we're worried that there won't be enough water to make all of our beverages.  

    Bernanke/Rev – I wouldn't count on Bernanke taking any kind of heroic stand.  I think his main goal is to get the fudge out before things blow up so he can leave his legacy intact – like our man Greenspan:

    Oil/Bruce – It's Wednesday so rally into inventory and then, hopefully dropping like a rock (though maybe not until after nat gas tomorrow).  

    August NYMEX contracts still at 124,000 – only 14,000 less than yesterday and that's not good for them.  They need a big dumping day.  

    Click for
    Chart
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Aug'13 105.78 105.85 105.11 105.80 07:36
    Jul 17


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    -0.20 24306 106.00 124418 Call Put
    Sep'13 105.47 105.60 104.79 105.50 07:36
    Jul 17


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    -0.19 13936 105.69 341092 Call Put
    Oct'13 104.25 104.28 103.54 104.21 07:36
    Jul 17


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    -0.18 4067 104.39 125187 Call Put
    Nov'13 102.61 102.84 102.16 102.70 07:36
    Jul 17


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    -0.25 1935 102.95 74466 Call Put
    Dec'13 101.41 101.43 100.81 101.36 07:36
    Jul 17


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    -0.19 4159 101.55 208415 Call Put

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