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Our SSO Trade Made 72% in a Week – Thanks Fixed Markets!

At least we can count on one thing: 

The markets are fixed, rigged, gamed, manipulated AND propped up by the Banksters and their pet Government - what can possibly go wrong?  Nothing if you know how to play the game (and, sorry bottom 90%, but this game can only be played by people with margin accounts to keep out the riff-raff).  That's why, last Thursday in our Live Member Chat Room, I was able to say

S&P better have support at 1,905 on /ES, which is 1,910 on the index, which is $110 on SSO and you can buy SSO Aug (next week) $109/111.50 bull call spreads for $1.45 with 72% upside potential on a very small recovery next week.  A good upside play if you are too bearish or want to lock in bearish gains.  

For those of you not lucky enough to be a PSW Member (and you can join here before the September rate increase), I even mentioned the trade in the next morning's post and SSO was still under $110 that morning.  Today is August expiration day and that contract should pay the full $2.50 for a nice 72% gain in 8 days – nice work if you can get it.  

More importantly, we reviewed our Member Portfolios yesterday and our Short-Term Portfolio is still at $129,916 while our Long-Term Portfolio is at  $598,115 for a total of $728,031, which is up $8,000 (1.1%) since last Friday and up a combined 21% for the year off our virtual $600,000 base for our main Member Portfolios.  

As I mentioned last week (and the week before and the week before) – it's all about BALANCE.  Balance and following our strategy of BEING THE HOUSE – Not the Gambler.  Selling premium and staying balanced allows us to grind out a steady profit in most market conditions.  We don't HAVE to guess which way the markets are going – plays like SSO are just a bonus, nice though they may be.  

So sure, the stock market is rigged.  It's a big game that is played to funnel money from the workers, who think they are saving their money for retirement, to the top 1%, who want to make sure the bottom 99% can never really retire until they are completely useless and unwanted – at which point the top 1% lobby not to have their tax dollars used to support their former employees.

 Don't complain folks, this is America – you voted for this!  

SINCE the game is rigged, it is simply our job to figure out HOW it is rigged and HOW we can make profits from playing along.   We have no illusions that we can influence the game – though most of our Members are in the top 1%, we are not delusional enough to believe we are in the top 0.001%, the 3,000 Billionaires and multi-multi Millionaires who REALLY control things in this country.  We're just happy enough to watch the game and occasionally play along.  

This morning, for example, in our Live Member Chat Room, we went long on oil (/CL Futures) at $95.50 and made a quick $150 at $95.65 and we went short on the Russell (/TF Futures) at 1,151.7 and made a quick $70 at 1,151.  That's $220 before breakfast and the Egg McMuffins are paid for!  We also picked a short trade on EPI (now $22.30) – as we think India is a bit overdone (for reasons discussed in Chat).

Today being options expiration day with Fed Minutes out next week (along with CPI, Housing Data and the Philly Fed), we're not expecting a turn-down today but we will be looking to short the most enthusiastic of our indexes – the Nasdaq.  It's been a very low-volume move up and that means we'd like to take an aggressive short position on the index that's about 5% over the others for the past 90 days.  

SQQQ is an ultra-short on the Nasdaq at $38.69 and the Sept $35/40 bull call spread is $2.60 and pays $5 (+92%) if the Nasdaq even twiches lower (say below 4,400).  If we're wrong and the Nasdaq breaks over 4,500 (now 4,453) we'll take a small loss and get out.  Keeping our reward/risk ratios positive is another critical part of our investing strategy – ALWAYS HAVE A TRADING PLAN!!! 

While I'm writing this (8:30) we have another opportunity to short the Russell Futures at 1,151.7, so that's fun too (/TF)!  On the whole, the indexes have finally managed to conquer our Strong Bounce Levels BUT it took them too long to get here, so we remain skeptical and the ultra-low volume on the up moves makes us even more skeptical so please – be very careful out there!  

Have a great weekend, 

- Phil

 


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  1. stjeanluc

    Oil Lines

    R3 – 99.40
    R2 – 98.50
    R1 – 97.07
    PP – 96.17
    R1 – 94.74
    R2 – 93.83
    R3 – 92.41

  2. stjeanluc

    And we should trust the free market for that as well:

    http://www.washingtonpost.com/blogs/wonkblog/wp/2014/08/13/why-the-drug-industry-hasnt-come-up-with-an-ebola-cure/

    The global research and development investment for neglected diseases totaled $3.2 billion in 2012, with almost two-thirds of that coming from the public sector, according to the G-Finder annual survey from Policy Cures. Drug companies pitched in about 16 percent, or about $527.2 million in all, the survey found.

    So the key question is how to encourage drugmakers to develop cures for these diseases, when the economic incentives don't match up with the public health needs. For drugmakers, the system incentivizes them to focus research and development efforts on products that will pay off. Think blockbuster drugs that come with patent protections.

    "You really have to break this link between patent monopolies and research investment," said Bryan Collinsworth, executive director of Universities Allied for Essential Medicines.

    In the meantime, we have 15 drugs for ED! I guess we need to wait for an outbreak of Ebola in Orange County to see private enterprise money flowing into that research! And some shortsighted politicians want to cut spending at the NIH and CDC. Idiots!

  3. stjeanluc

    Looks like 25M pre-orders for the iPhone 6:

    http://qz.com/249889/apples-harvest-25-million-americans-are-ready-to-upgrade-their-iphones/

    Some 35% of US iPhone owners polled say they are likely to upgrade their device in the next six months, comScore reports. That’s about 25 million people. (There were 173 million US smartphone subscribers at the end of June, according to comScore, and Apple represented 42% of the market.)

    iPhone Upgrade Intent Among Current Owners

  4. Phil

    Good morning! 

    Oil over $95.75, that's the stop now on /CL.

  5. stjeanluc

    Not good news for the bottom 80%:

    http://qz.com/249582/the-rise-of-robot-scheduling-is-a-nightmare-for-low-wage-workers/

    “Automated scheduling software” has been touted as the wave of the future (paywall) for hip, forward-looking, data-driven workplaces. The company Kronos, for example, promises to help restaurants “provide outstanding customer service as you control labor costs.” Using the system, employees have variable hours, determined by data on customer flow, allowing managers to schedule more workers during busier times and fewer on slow days.

    “Along with virtually every major retail and restaurant chain,” Jodi Kantor writes (paywall) in the New York Times, “Starbucks relies on software that choreographs workers in precise, intricate ballets, using sales patterns and other data to determine which of its 130,000 baristas are needed in its thousands of locations and exactly when.”

    But, Kantor points out, for low-wage workers, especially parents, the system’s shifting work schedules can make life extremely difficult. For white collar workers, “flexible work” often means the ability to take a few hours or days a week spent working at home, and is the sign of a progressive and supportive employer. For low-wage service employees, however, there’s nothing particularly flexible about the variability of robot scheduling.

    As you say Phil, we really need to re-evaluate our society's priorities! 

  6. stjeanluc

    Wow… 

    http://qz.com/249639/the-utter-transformation-of-us-finance-told-in-one-chart/

    What’s the takeaway? US consumption, like consumption in most advanced economies, is tightly linked to credit availability.

    In the wake of the US housing bust, mortgage lenders, understandably, became extremely cautious on loans. They remain so, and the US housing market remains weak. Auto lenders, on the other hand, have gotten aggressively permissive about lending. The result? US auto sales have made a huge recovery.

    Remember that next time you hear some economic pundit jabbering about how American consumption depends on wage growth. It doesn’t. Consumption depends on access to credit.

  7. craigsa620

    /CL -Phil when you say $95.75 is the stop, do you mean for a bullish bet it is support? I am pretty sure that is what it means, but always feel the need to check I am understanding your intent.

  8. stjeanluc

    I guess it's about the coffee price for GMCR – but 50% margin, gee!

    http://qz.com/249473/even-keurig-is-raising-prices-due-to-sky-high-coffee-costs/

    Following in the footsteps of Starbucks and Maxwell House, single-serve coffee giant Keurig Green Mountain is set to raise prices by up to 9% on all of its products, including its hugely popular K-Cup portion packs. The company had been comparatively slow to raise prices, possibly because the margins on K-cups are so high that they could absorb coffee price increases for a time.

    The gross margin on K-Cups can approach 50% in some cases, huge for any industry, let alone food retail.

    The increase will go into effect November 3rd. Behind the jump is a massive increase in the price of green coffee, which is up more than 50% over the past year, after a drought and disastrous harvest in Brazil. 

  9. Phil

    Free market/StJ – That's tricky stuff, you simply have to have Government funded research and then, down the road, pay for it by selling discoveries to Pharma, who can capitalize on it down the road.  We have Government research now, but it's a money pit as they give away their discoveries.  When does the Private Sector ever share with the Government?  I'm all for private enterprise but why does the Government run like a charity – it sets itself up to be taken advantage of?  

    NASA invented Insulation, Invisible Braces (the material), CAT Scanners, Microchips, Joysticks, LEDs, Memory Foam, Contact Lenses, Smoke Detectors, Solar Cells, Water Filters, Powdered Lubricants, Gym Equipment (for training astronauts), Velcro…   All invented on the Government dime and then given away to business.  That makes no sense in a "Capitalist" Society, does it?   NASA would never need money again if they were just collecting royalties off the stuff they already invented.

    IPhone/StJ – Sounds about right, especially if the people who said they wouldn't were specifically not interested in a bigger phone (I'm not).  Certainly doesn't say anything about overall demand for the brand if the question was interpreted that narrowly.  

    iPhone upgrade intent chart comScore

    Of course, if you ask "over the next 6 months", you also are not accounting for how many people (75% probably) are trapped in a 2-year plan they have to cycle out of before they can upgrade.  Given those restrictions – sounds like people are extremely enthusiastic but, of course, that's the flaw in any survey – it's hard to tell how people are interpreting the questions they are being asked.   

    Automated Scheduling/StJ – This is truly despicable stuff!  Of course, if you own a restaurant, you want 20 waiters on a Friday and Saturday night between 6-9 and 15 on Sunday and 5 on Mon-Weds and maybe 10 on Thursday but BECAUSE THAT's RIDICULOUS, we make realistic compromises with the wait staff so they can make a reasonable amount of money with a reasonable amount of free time.  Of course it doesn't perfectly optimize the service or the profits BUT THAT IS NOT THE ONLY CONSIDERATION IN A HUMAN EQUATION!!!  God this pisses me off!  

    What these systems do is take away the guilt of the boss/manager when he wants to make unrealistic demands of his staff.  As Marx warned, the goal of Capitalism is to completely dehumanize the worker until they are simply easily replaceable cogs in the machine – at which point their value drops to the lowest possible commodity price for labor.  Mission Accomplished!  

    Alienation (Entfremdung) is the systemic result of living in a socially stratified society, because being a mechanistic part of a social class alienates a person from his and her humanity. The theoretic basis of alienation within the capitalist mode of production is that the worker invariably loses the ability to determine his or her life and destiny, when deprived of the right to think (conceive) of himself as the director of his actions; to determine the character of said actions; to define their relationship with other people; and to own the things and use the value of the goods and services, produced with their labour. Although the worker is an autonomous, self-realised human being, as an economic entity, he or she is directed to goals and diverted to activities that are dictated by the bourgeoisie, who own the means of production, in order to extract from the worker the maximal amount of surplus value, in the course of business competition among industrialists.

    Capitalism reduces the labour of the worker to a commercial commodity that can be traded in the competitive labour-market, rather than as a constructive socio-economic activity that is part of the collective common effort performed for personal survival and the betterment of society. In a capitalist economy, the businessmen who own the means of production establish a competitive labour-market meant to extract from the worker as much labour (value) as possible, in the form of capital. The capitalist economy’s arrangement of the relations of production provokes social conflict by pitting worker against worker, in a competition for “higher wages”, thereby alienating them from their mutual economic interests; the effect is a false consciousness, which is a form of ideologic control exercised by the capitalist bourgeoisie. (See: Cultural hegemony) Furthermore, in the capitalist mode of production, the philosophic collusion of religion in justifying the relations of production facilitates the realisation, and then worsens, the alienation (Entfremdung) of the worker from his and her humanity; it is a socio-economic role independent of religion being “the opiate of the masses”.[3]

    Yeah, let's vilify Marx before someone realizes he made some really good points!  

    Nice dip in /TF to 1,148!  Now we'll see if they can take back 1,150 again.  

    Consumption/StJ – But doesn't access to credit depend on wages too?  

    Stop/Craigs – I'm just talking about setting a trailing stop – to take the profits if it slips below.  You should, from the second you enter a futures trade – be looking for any excuse to get out!  It should PAIN you to be in the trade because the only way you can lose money is by staying in the trade and the only way you can make money is by taking profits and getting out of the trade so, by default, you WANT to get out ASAP!  

    GMCR/StJ – What coffee price increase?  Coffee has been the same price since spring.  Man, the press doesn't even check facts anymore – they just print the press releases!  

  10. edro00

    /CLU4 – /CLV4 now 1.63 ……

    It will be interesting to see how this plays out

  11. Pharmboy

    Gold getting schmeared!!!

  12. stjeanluc

    Coffee / Phil – You have to look at long term charts wink

    If you have 50% margins you can absorb some bumps in prices, but not ones that last too long!

  13. stjeanluc

    Automated scheduling / Phil – Didn't mean to get you started early in the morning! Oh wait, yes I did smiley

    Let's forget about these lazy bums in the bottom 80% and make some easy money in the markets! It works for the Koch Bros!

  14. Phil

    Art Cashin says yesterday was slowest trading day of the year.  Have I mentioned how much I like SQQQ lately?  

    Stop on oil is now $96 (+$500!).

    Meanwhile, silver plunged to $19.51, that's a really tempting long, especially if gold doesn't follow suit (/SI).  Copper down to $3.08 (very weak) though so it's just that silly theory I have that actual Global demand sucks and this market is nothing but propped up BS.   

    Lewis Black to Limbaugh (who was calling Robin Williams another "Leftist failure"):

     
     
    FUCK YOU Rush Limbaugh. Your statements were beyond cruel and stupid. They were intolerable. Enough is enough from you. You are an idiot. Don't you ever demean the death of another human being. He was my friend. You disgust me.

    While discussing Robin’s passing during his radio show on Aug. 12, Rush spoke at length about the “leftist” attitude, saying of the acclaimed actor and comedian: “He had everything, everything that you would think would make you happy. But it didn’t. Now, what’s the left’s worldview in general? What is it? If you had to attach not a philosophy but an attitude to a leftist’s worldview, it’s one of pessimism and darkness, sadness. They’re never happy are they? They’re always angry about something. Not matter what they get, they’re always angry.”

    Yeah, we're always angry Rush, because we can still hear you!  

  15. Phil

    Gold/Pharm – Someone big must have really dissed metals this morning.  Well, $1,285 is our long spot on /YG and we'll take $19.50 on /SI too!  

    Coffee/StJ – Or longer – Coffee was simply unusually low for a while (which is why we went long), GMCR has been around since 1981 and putting out those machines since 2006, so the pricing was based on much higher pricing than we have now and we're still miles under the 2011 spike, when GMCR already drove prices way up on the cups.  Funny how, when the price of coffee drops 50%, they don't bother to lower the prices…

    Wheeee!  1,146 on /TF!  Oil done-looking at $96.  

    Forget about it/StJ – I think these discussions are great motivation to remind us how important it is to stay in the top 10%!  It's like those SciFi movies where life is so wonderful inside the bubble community that's walled off from the horrors of the outside world.  As long as we toe the line and exploit the masses – we get to stay but, if we should start sympathizing or, even worse, actually helping them – we'll have our privileges revoked and be tossed outside with the sub-human masses.

    Don't forget, I wrote for Forbes for a while and that's exactly what they did when I dared to mention they system was unfair.  Literally the editor said "we don't want to upset our readers."  

  16. Phil

    TLT flying up to 117 – someone is a bit nervous.  

    Good time to go long on the VIX at 12.20, I think.  

  17. dclark41

    Phil:

    Hate to keep bringing up these next week QQQ puts, but they are down to .42. Should we roll up to the 97.5 for .19 or buy another week?

  18. britkid99

    Phil – What happened to TASR? Riots inspired pop?

  19. pirateinvestor

    PHil-Elizabeth Warren needs to read your take on CDC, Nasa etc. She seems to be the only one with brains who could push to change such baloney. I also read that Alibaba is based in the Cayman Islands with a huge business in China & there might be problems with the IPO because of lack of disclosure. Getting some wind behind it, it seems. It can't be listed in any index because of this so will limit the interest? Just wondered if you heard such things-news to me.

  20. stjeanluc

    Top 10% / Phil – That's what I told my 2 kids – you need to get the best possible jobs or marry rich because the plight of the bottom 90% is bound to get worse. One of them is on her way (job), I am still working on the other!

  21. Phil

    GMCR – Sorry, I just realized my point may not be obvious on them.  So GMCR has sold XMillion machines since 2006 and people who bought them originally did the math on K-Kups that were half the price they are now.  GMCR is assuming (not a good thing) that demand is inelastic but even my wife knows that it costs here 50% more to use K-Kups than to make her own pot of coffee (and she explained this to me while eating ice cream that cost 0.25 per spoonful!), which is why she won't buy it.  So a 10% increase in price drives the marginal cost up 20% – in other words, if a K-Kup is $1 and pot coffee is .50, now a K-Kup is $1.10 so now costing .60 more (120%) - another 20% difference.  

    I think that's about where we hit a psychological tipping point and sales begin to drop off.  It doesn't cost people anything to STOP using their Keurig, consumers don't take fixed cost investments into account – only running costs.  Even if they threw out their old coffee machine, those are pretty cheap and they can justify the purchase with what they'll save by ditching K-Kups.  

    66% of GMCR's revenues come from the K-Kup sales, 15.4% from the machines and only 4.5% from royalties (Trefis data).  That means it's TERRIBLE for them to have their "partners" doing well selling their own coffee in K-Kups, the license revenue can't possibly make up for the lost direct sales and GMCR is taking a huge risk to stabilize declining revenue growth (5.5%) and the $4 they plan to earn next year is a rough sell against a $115 price tag.  

    Not to mention the chart is toppy (I had to say that to make Diamond happy wink):

    TASR/Brit – No, haven't you heard, they have a whole new market now – Kid Control!

    Cops Use Taser on 8-Year-Old Throwing a Tantrum

    I know I forwarded that article to both of my kids!  

    Actually, this is my long-standing prediction that the tide will turn on TASR when incidents like Ferguson lead to lawsuits about why the cops DIDN'T use a Taser instead of a gun. 

    Submitted on 2012/10/26 at 10:02 am

    TASR/Button – Sure, see above.  Me love them long time.  They were just $4 when I named them stock of the decade in the fall of '09 and have been below $4 plenty of times since.   That might be it though for cheap entries.  Here's my logic on TASR, long-term:  

    Police/B1 – They are specially made but we don’t even have an auto industry anymore so I guess they’ll have to be calling Toyota.  As to TASR, they are my stock of the DECADE, not the year.  My theory is that there will soon (2-3 years) be lawsuits from people who are shot with a gun when a TASR COULD have been used and that will flip the concerns of the police from being sued with the stun guns to being sued without the stun guns.  Also, they will be making some more advances in conjunction with battery tech that gives them some wireless options that will increase range substantially.  As I often say – can you imagine in Star Trek if they are in a phaser fight and one guy suddenly whips out a 44 magnum and blows some guy’s head "clean off"?  It would seem totally barbaric, right?   That’s the future – you can’t expect game-changing technology not to creep in over time.  In the history of weapons, when has that ever happened?  Arrows were much cheaper than guns yet, not surprisingly, eventually every king sprang for the steel, didn’t they? 

    QQQ/$25KP, DC – Yes, .42 sucks and I don't want to DD again but I also don't want to take a $600 loss so, I'm sticking with it for now (over the weekend). 

    GTAT/DC – Man, I have to start charging those BNN people – that was my new pick for them two weeks ago!  

    Warren/Pirate – Feel free to send it to her, she's my political hero!  As to AliBaba – I tend to ignore all BS rumors prior to an IPO.  

    Alibaba Discloses Possible Accounting Problem At Film Unit Ahead Of U.S. Listing

    Why Alibaba's Accounting Woes Won't Derail the IPO Train

    I still like our long play on YHOO as the best way to participate in AliBaba's IPO, it's already tremendously discounted to the potential price within YHOO's $36Bn total Market Cap.  

    Kids/StJ – Jackie already has a rock star boyfriend (well, a YouTube star, anyway) but I'm worried about Maddie, who's dead set on being an artist.  Just means I have to work twice as hard so I can leave a foundation that can support her.  

  22. stjeanluc

    Phil - That little extension about political donations works on PSW as well:

    Warren is really collecting some dough… And close to 45% are donations of less than $200.

  23. Savi

    STJ—lol

    both my kids have jobs—but one does not care about the money (Teach for America) and the other just took a pay cut to work at the White House—--maybe they will marry rich  ;-)

    BTW  I am traveling in Europe most of this fall—I am told that the i phone 5 is unlocked—thus to use it there could I just get a sim card and not use Verizon which is so expensive—-thanks

  24. Phil

    That thing is cool.  Of course Senators do better than Reps.  Let's see if this thing is reliable:

    Dems:

    Harry Reid 

    Dick Durbin 

    Charles Schumer

    Patty Murray 

    Reps:

    Mitch McConnell

    John Cornyn 

    John Thune 

    Roy Blunt 

    White House/Savi – Well that's certainly not slouching!  Let me know what you find re. phones in Europe, I have to do that next Summer.  

  25. stjeanluc

    Savi – I have a T-Mobile account and now they have unlimited international data roaming and unlimited text in most countries. And roaming international calls are $0.20/min so not bad! A new SIM is of course a solution, but that means a new number as well. You could of course get one of these cheap phones in Europe to make your calls and keep your current phone if someone tries to reach you while you are there. That's what I did last summer when my wife stayed there a while.

  26. Phil

    Wow, that thing works great – does everyone get a pop-up for those names or just me and StJ because we downloaded the thingy?  Turns out Warren kicks all their asses in money raised.  Warren's under $200 raise of $21M is amazing – it's more money than most other candidates raised in total and most of them have less than 10% raised under $200.  God I love that woman!!!  heart

  27. stjeanluc

    Works great Phil… And your pal Libby is way ahead of these guys! But not one of them is above 8% for donations below $200 so that tells you something.

  28. Phil

    Another rejection of /TF at 1,150, /ES failed 1,160 too so both good shorts,.  /YM will be nice laggard below 16,700 and /NQ way over 3,975 so we'll see how that goes.  

  29. Phil

    TLT still rising, /YG coming off the $1,295 line and /SI now $19.59 and that's $50 per penny, per contract!  

  30. pirateinvestor

    FYI-I use a Rugby (unlocked) military Samsung; waterproof & tough as I needed it for traveling internationally & the carribean> My son sent one to me-got it through the internet about $200 & I bought an ATT card for $100 that lasts a year. I am shorting VZ as I was stuck with them for 2 years & they are the pits-real crooks. All my family has got rid of VZ though some say it's OK, BUT they are the ones who have Friends & Family plan & don't pay the bill!

  31. pstas

    Warrren- hope she runs. Libby vs. Hillary could shape up to an epic primary battle. Besides, I cant wait to see Libby campaign wearing her headress .

  32. rdn4evr

    Phil, Never thought I'd say this, but "go /CL".  You threw out a comment yesterday about oil maybe spiking down to $85.  How likely do you think this is and what kind of timeframe, i.e,. next week's contract rollover, 1 month, 6 months?.

    Whoa, what's up? any news?

  33. stjeanluc

    Just wow…. Not that I am surprised at the analysis, but who that comes from!

    http://talkingpointsmemo.com/livewire/tom-coburn-oklahoma-senator-fox-news

    Oklahoma's Tom Coburn is one of the most conservative senators, but sometimes Fox News is even too much for him.

    The Republican said "the truth is somewhere in between" MSNBC, Fox News and CNN — although when it comes to the most conservative of the three, sometimes he just has to flip the channel.

    "There are certain shows on Fox I can't watch because they're totally not fair and totally not balanced," Coburn told the crowd Wednesday at Tulsa Community College. "And so what I want is I want all the information in which I can make the best decision."

  34. britkid99

    Selling programs hitting nyse tick

  35. Phil

    Warren/Pstas – That would be a tragic waste of resources.  Hopefully Liz would be happy to be VP for Hillary.  If I get my way, the Dem primaries will be a farce, nothing more than a platform to push talking points and unite the Dems behind Hillary or Liz (or both).  

    Oil/Rdn – We still have Ukraine and Iraq so $85 very unlikely at the moment.  $85 is the fair price for oil outside of geopolitics but there's always geopolitics so very tough to get there but demand is also weak so I'm not expecting a huge move up – just that $95.50 was a bit oversold SO FAR – enough to make a Futures long worthwhile but I'm not buying up USO or anything (and we just shorted XLE on the premise that we'd sustain low oil prices). 

    Ah, more Russian vehicles on the move and maybe Ukrainians shelling Russian troops.  Wow, who could have imagined this thing could escalate?  Holy crap are market bulls stupid!  

    LOL StJ – Fox News has gone too far right for the guy who published the Wastebook?  

  36. Phil

    See why we kept poking at those index shorts?  The chance of a jackpot like this was higher than the chance of getting burned to the upside – that's how we play them!

    Gotta watch those bounce lines again to see if they fail now:

    • Dow 17,100 to 16,350 is 750 points so 150-point weak bounce to 16,500 and a strong bounce would be 16,650
    • S&P 1,990 to 1,900 is 90 points so 20-point bounces (rounding) to 1,920 (weak) and 1,940 (strong)
    • Nasdaq 4,475 to 4,325 is 150 points so 30-point bounces to 4,355 (weak) and 4,385 (strong)
    • NYSE 11,050 to 10,550 is 500 points so 100-point bounces to 10,650 (weak) and 10,750 (strong)
    • Russell 1,200 to 1,110 is 90 points so 20-point bounces (rounding) to 1,130 (weak) and 1,150 (strong)
  37. rustle123

    just made 4x on my money in 30 minutes with uvxy calls @28 for next week.  And now will buy them back if market turns positive.

  38. Phil

    Remember this from yesterday's chat?:  

    152300 600 Trojan Putin cartoons

    This is what I mean about FUNDAMENTALS – I don't give a crap what the squiggly lines say, we had GLOBAL MACRO reasons to remain cautious AND from our observations of the low volume in the rally – we could tell that there was very little real support to the week's gains.  

    We don't know whether or not the rumors are true but it's a good illustration of WHY we feel better about staying neutral/bearish as we get back to the high end of our recent range (see, TA talk too!). 

    Very nice Rustle!  

  39. Phil

    VIX jumped to $14 – that was very easy money off $12.20 before.  

    Things calming down here so lock in Futures profits (1,945, 16,600, 3,966 and 1,137) and we can always switch to fresh horses if 16,600 fails along with 1,945, 3,975 and 1,135).

  40. News:

    Russian foreign ministry confirms fighting in eastern Ukraine, says Ukrainian govt trying to stop aid

    A Ukrainian military spokesman said Ukraine forces have engaged a Russian armored column on Ukrainian soil and “part of it no longer exists.”

    Read more: http://www.cnbc.com/id/101906428

    Sent from the CNBC app. Available for iPhone
    and iPad

  41. News:

    Split decision: Sentiment falls as conditions rise

    U.S. consumer sentiment fell to its lowest since November while a barometer of current economic conditions rose to its highest since July 2007.

    Read more: http://www.cnbc.com/id/101922730

    Sent from the CNBC app. Available for iPhone
    and iPad

  42. News:

    Ukrainian forces engage Russian troops on Ukraine soil

    A Ukrainian military spokesman said Ukraine forces have engaged a Russian armored column on Ukrainian soil and “part of it no longer exists.”

    Read more: http://www.cnbc.com/id/101906428

    Sent from the CNBC app. Available for iPhone
    and iPad

  43. News:

    Economists raise 3Q US growth forecasts: Philly Fed

    Economists raised their forecasts for U.S. economic growth in the third quarter, but trimmed their estimates for 2014.

    Read more: http://www.cnbc.com/id/101906300

    Sent from the CNBC app. Available for iPhone
    and iPad

  44. News:

    Two major grocery chains in potential data breaches

    Two major grocery store chains—Supervalu and Jewel-Osco—said they may have been adversely affected by computer data breaches.

    Read more: http://www.cnbc.com/id/101922584

    Sent from the CNBC app. Available for iPhone
    and iPad

  45. News:

    Amazon Fire ‘traps’ users: Consumer Reports

    The Amazon Fire smartphone doesn’t measure up against its competitors and “traps” its users in the Amazon ecosystem, according to Consumer Reports.

    Read more: http://www.cnbc.com/id/101920861

    Sent from the CNBC app. Available for iPhone
    and iPad

  46. stjeanluc

    That crisis between Russia and Ukraine is driving wedges between families – there was an article on a big French news website where they reported that Russians who lived in France now could not have a sensible discussion with their families in Russia because they were so indoctrinated with the official propaganda from the Putin owned media.

    I am having some similar issues with my Russian colleagues. Some of them are open minded and report to me what they see, others just repeat talking points and lies shown on TV. It's really scary there.

  47. News:

    Auto parts makers rev up July industrial production

    U.S. industrial production edged higher in July, as production of auto parts and motor vehicles jumped.

    Read more: http://www.cnbc.com/id/101922724

    Sent from the CNBC app. Available for iPhone
    and iPad

  48. News:

    Sloppy summer to continue this fall: Stock pros

    Despite the rough ride this summer due to international turmoil, stocks look like they’re poised to continue their upward march, two market watchers tell CNBC.

    Read more: http://www.cnbc.com/id/101922798

    Sent from the CNBC app. Available for iPhone
    and iPad

  49. lol730

    stjeanluc: Same here.  (First time I agree with you :)

    What amuzes me the most – I would understand when some young people get brainwashed. But some of my Russian relatives, who were born in 60s and raised during Soviet times, they are also falling buying this propaganda. They belive than "US downed this Malasian plain", "US arms russian separatists, to provoke Russia", etc. In 60s and 70s and 80s, there was also brainwashing. But everybody new that you cannot trust it. I don't know how, but current Putin's propaganda people turned out to be much much much more skillful than Communist Party.

  50. chasw

    Phil / TF, ES – have followed you closely over last two weeks and tried to make my 1st trade shorting TF this am at 1152. Turns out TOS in Canada does not provide any futures trading capability:-( It is what it is.

  51. palotay

    Wombat/CL – I closed the spread out today for a chunky loss.  An expensive lesson. The fact that the contracts will expire and the new spread can be dramatically lower, really hurts the strategy when we run into an issue like this near expiration.  We don't really have a fall back position to get the losses back.

  52. lol730

    palotay – dig 3-4 months back in forums. I've told so, I warned about this at least 10 times. Beacuse I track this strategy for good 4 years. Nobody wanted to listen. :(

    For the past 4 years it happens may be 4th time, but one blow like this eats alomost all gains of successful cycles.

    even if you more conservative with position sizing, so you can double-down next time, your average return on margin comes to about 7-10%. and this comes with huge violatility.

    In a word my advice (and I hope this time people will listen), use Phil's buy write strategies, and over time you will get much better rate of return

  53. stjeanluc

    Russia / Lol – First time for everything!

    I think that Putin's propaganda has better results because the lives of people in Russia has improved dramatically under his leadership. I am talking financially at least. So of course they would tend to believe him more than the Russian propaganda when it was clear from waiting in lines at the store that they weren't winning! 

  54. snow

    Wow, that was a huge volume spike on DIA at 8:55.

  55. yo_mamma

    Yeah it was! Shee-it!!!

  56. Savi

    LV Meeting—-do not forget to e-mail admin@philstockworld.com with indications of interest—need a min of at least 20 to begin organizing atm only 8 STJ—thanks Phil--she is no slouch but pay cut ??—she is looking ahead--hope it works out—as to the phone will keep u informed

  57. Winston

    Phil/VIX – how did you play that spike up?

  58. palotay

    Thanks LOL.  I must have missed your post a few months back. You are completely right about sticking to the basics, and making much better returns.  My long term conservative portfolio full of buy/writes and artificial buy writes is doing amazing. 

  59. rdn4evr

    PLX and CRIS finally bottoming?  if they are up today that has to be good news.

  60. yo_mamma

    Wild news. Wild day. Glad I stalled that seat belt on my toilet.

  61. snow

    Interesting article about the Elio three-wheeler on Yfinance. I've seen those around LA once in a while over the past five years or so. Wonder how they got them….or maybe I was seeing another three-wheeler with outrigger front wheels, who knows.

  62. palotay

    Peter/Strangle – Any new strangle play?

  63. Phil

    Russia/StJ. Lol – I found that Daily Show report very enlightening about Russia and Putin with that woman explaining their "Don't be a Pussy" attitude.  This whole incident plays into that kind of mentality. 

    Futures/Chas – The indexes work just as well.  If you want to short /TF now at 1,130, you can, instead pick an IWM put with little or no premium, like the Aug (today) $114 puts at $1.56, which has pretty much no premium at $112.50 or TNA today $70 puts, now $1.20 with TNA at $69.04.  Of course, a bit late to chase now, but hopefully you get the idea.  

    Thanks LOL, quantifying what I've always assumed re. spreads.

    Volume/Snow – Of course there's volume, we're going down!  wink

    Argh, Savi – don't tell people to EMail me!!!!  Folks Email Vegas interest to Greg@philstockworld.com or admin@philstockworld (still Greg), my Email will put you straight to junk if you are not on my list.  

    Pay cut/Savi – For Liz?  She wants to get things done and I don't think she wants that much spotlight.  You can get a lot done as VP if you really have the Prez's backing so it would come down to how much she trusts and agrees with Hillary.  She's 65 and a failed attempt at a nomination would be her only shot at the presidency but being Hillary's (67) VP let's her coast into the #2 slot and lines her up for her own easy run at 73 or sooner if Hillary's health fails.  Biden is 72 now, 74 in 2016 so very unlikely he'd even try.  Women are much more durable at that age…

    VIX/Winston – This was one of the rare times that VIX calls were not too ridiculous because they expire in 4 days, the $11s were $1.70 and popped over $1 on the move up.  Same logic as above with the Futures for Chas – just find an in-the-money contract that's in your direction and you'll pick up the bulk of the gains.  

    Basics/Palotay – Such a nice, relaxing way to play the market, isn't it?  

    Speaking of our Portfolios, LTP strong at 19.6% ($598,000) and STP still good at 29% ($129,000) so $727,000 despite the day's nonsense means we can sleep soundly over the weekend!  

    LOL Yo!  Thank goodness, the week had been so dull….

    Elio/Snow – Those things are cool.  Would be great if we could get people to rethink transportation.  I sit in traffic on the Parkway in NJ and I start doing the math of all the hundreds of thousands of people heading in the exact same direction yet all sitting in their own SUVs (40%) by themselves – it's sickening!  

    What else do you need to go to the store?  

  64. lunar

    phil, are we still in next week's 97 qqq puts trade?  i had doubled down and then gotten half back out at 1.01.  my cost now is 1.00.  TIA.

  65. Savi

    LV Meeting—--PLEASE NOTE CORRECT E-MAIL FOR  indications of interest —-admin@philstockworld.com

    sorry Phil

  66. shadowfax

    Yesterday was the information clincher, after 40 years voting independent, in 2011 I registered as a republican to vote in the primary and I will again Tuesday. Main reason is to oust governor Mead. In a no matter what WY will be all red I might change a red name or 2 or all I can actually do to through out the bums. Mead actually brought charges against the superintendent of schools, failed in the supreme court, and although the party won't change she at least is open to expanding Medicaid that has screwed all the lower income people in the state and cost the way too much money.

    So if in a locked up state please consider what you can do instead of giving up.

  67. Phil

    Speaking of cars, the new Caddy looks nice:

    QQQ/$25KP, Lunar – Still in them.  Had they hit $1 I would have loved to get out but no such luck.  Still my original premise was something bad would happen over the weekend and something bad is already happening so we have a head start!  

    Np Savi.

    Good point Shadow, we all have to fight the power as best we can.  

  68. lunar

    phil/qqq puts, thanks.  the puts did hit 1.03 earlier today.  i had a GTC order in to get out at my average price.

  69. spank

    StJ / Lol – I'm not sure I necessarily agree with you on the Russian stance.  I'm under no illusion that Putin and his goals are on the right side of good versus evil; however, there are still wayyyyy too many unanswered questions and coincidences with the downing of Malaysian plane, the missing first Malaysian plane, the events of Ukraine/Russia/Israel/Palestine/Syria, etc.  Add into the fact the near across the board consensus with all main stream media in the West, and I am fully aware that all is not what it seems.  I work with a small contingent of 2-year assignment secondees from Eastern Europe in our Big 4 audit department and have heard some very unique views.  They read both sets of press and find that each has it's own propaganda built in.  All can agree that it is borderline impossible to determine the truth of what's going on when so much is obfuscated and/or outright lied about.

  70. Phil

    Where's Uncle Ronnie when we need him?  

  71. shadowfax

    Phil Autism

    Yesterday I made a statement that deserves detail. This country has a system where money either government or private donations by wealthy people never go to the actual patients. Private business scoops up the money or 90% GOES TO ADMINISTRATION AND EITHER WAY IT IS TRANSFERED TO MORE PEOPLE WITH TOO MUCH MONEY! Will it help with parents with autistic kids? Not directly and maybe never.

    I found out in Germany the equivalent of malpractice insurance is a pool of money. Anyone who has a problem is brought up before a board that decides how much compensation they will get. No lawyers and most of the money goes to victims of bad luck, the costs are very reasonable and medicine costs way less.  Here lawyers take a minimum of 60% and only the rich can afford the lawyers so the bottom 80% get screwed. It transfers to the rich no matter what.

  72. rustle123

    NFLX running with the bulls today.

  73. Phil

    Wow, oil up to $97, up $1.50+ today.  That's one problem with shorting oil, you can get really whipsawed on any kind of disruptions.  Fun short at $97 (/CL) but need balls of steel.  

    Screwed/Shadow – Well, there are so many ways "THEY" screw people it's hard to keep track.  That's why my preferred way to volunteer is to help get laws changed, rather than throw money at problems.  Our glorious Capitalist machine is very efficient at intercepting money, no matter where it is intended to go, and diverts it to the people who need it the least.  Even if, for example, we manage to raise $100M for a treatment program, it still goes into the World's most expensive and wasteful medical system.  So we need to change the system as best we can but it's a very long, tedious process and, even worse, when we get an administration like Bush II, they dismantle decades of work in just a couple of years and then we have to start rebuilding from scratch again – fighting uncooperative Congressmen all the way – even when we do have a sympathetic administration. 

    That's nothing new though, human rights have been an uphill battle ever since the first caveman asked his tribes leader to stop bashing his brains in with a rock.  Somehow, we make progress and sometimes we slip back but I try to waste less energy being angry at everyone involved and more time focusing on the actual problem – applying leverage in places where a change can actually be made.  

    NFLX/Rustle – So tempting to short!  

  74. stjeanluc

    Spank – To a certain extent, I agree and I told that much to my colleagues in Russia. Look at what happened leading to the war in Iraq. Propaganda at its best! But still, in the US you can have guys like Limbaugh on the air 24/7 criticizing and insulting Obama. Lets see how that works in Russia! People can gather together in front of the White House with big protest signs. My friends in Moscow told me that they would not last 5 minutes on Red Square with the type of protest. Kind of telling for me.

  75. rustle123

    Must be a rumor out about upcoming news on NFLX, I would wait and see before doing anything.

  76. stjeanluc

    Looks like KO got an energy drink boost today smiley

  77. stjeanluc

    How did that austerity work for you in Europe:

    IP 0814 Friday links:  crash legacies

  78. Phil

    TLT is an interesting long-term short because it invests in Treasury Bonds that average 17 years, so a 1% rise in rates would knock it down 17 points.  2016 $115/107 bear put spread is $4 so up 100% if rates tick up is a nice way to hedge your exposure to higher rates.  

    This one we just shorted (5 Sept $93 puts in $25KP, now 0.90):

  79. scottmi

    Billion dollar website: healthcare.gov

    http://www.zdnet.com/the-billion-dollar-web-site-you-paid-for-7000032564/

  80. stjeanluc

    FWIW:

    Screen Shot 2014-08-15 at 9.17.02 AM

  81. scottmi

    I sure wish these things would just go smoother.

  82. toepull80

    st jean/ austerity — do you really believe any european country truly implemented austerity?  i thought it was known that european austerity was entirely smoke and mirrors .. atleast in places like greece, portugal, and spain. 

  83. wombat

    palotay // CL
    sorry about that – i hit the same thing. makes it even worse that i could have cashed in the week before at 110%. Out of 10 rounds of this, this is the only one I've had a problem with – I feel your pain.
    I'm going to look at movement when all said and done but it just doesn't make any sense, other than the front month dropped too fast for the other to catch up.
    I guess the takeaway for me is scale back my scaling, to take advantage of crazy illogical whipsaw like this. Curious to see how this one ends >>

  84. mrmocha

    PCLN – has almost retraced its recent gap up, and has a support line around 1260, if it bounces off of that next week it could resume its uptrend.

  85. toepull80

    phil would you characterize soros as an investor or a trader?  what allows him to be so consistently successful? 

  86. akademia

    Phil / TLT

    Is that $115/$107 a Bull Call Spread or a Bear Call Spread? Shouldn’t the Bull spread be $107/$115? And if we are playing for a 17 point knock down (currently from 117 to 100) shouldn’t it be a Bear call or a Baer put spread? Sorry if this question is too basic.

  87. scottmi

    SGYP/Pharm – down around lows. would you enter or add here?

  88. palotay

    Wombat/Cl – No need to be sorry.  I'm glad you shared the strategy with me.  It was a good learning experience.    In the future I think I will consider playing if there is a big spike with plenty of time before the front month expires.  That way you have time for it to normalize.  I would also strongly consider closing or reducing before it gets too close to expiration.  Taking big gains off the table is also a good idea.  I made the mistake of adding more as the spread went against me, and that really exacerbated my losses.  In retrospect that was a really bad idea this close to expiration.    

  89. shadowfax

    Phil Justice and opportunity in America

    Actual person attempt. I met this guy who bought arguably the worst piece on land in ID for $5,000 owner financed. He was given an old small travel trailer and had a temporary power installed as at construction sites. I tried to explain how his hook up needed a ground wire and correct polarity. land flooded and the trailer burnt down.

    Next he built a 10X10 shed, and a well put in. The shed had a shower, toilet, and he would sleep on the floor. His septic was a 55 gallon drum with holes and rocks around it. Storage was a free ancient school bus. First busted for the septic, then the well was in the flood plane, the bus, and the list goes on and on. As expected on probation, violates that, jail, let out cant get to parole meeting, no transportation, back to jail for a few years. State can't afford to hold him so his parole has the condition that he can NEVER return to that county. The place looks the same, he even pays taxes on the land even though they tried to sell it. the problem was the cost to dispose the junk was more that the land was worth, no bids. He lives with his grandmother in Boise, the people surrounding his land would rather he came back he kept it clean and tried to do what he could. Great system for the 1%, sucks for the struggling neighbors. 

  90. lol730

    wombat /CL – actually it was opposite,

    front month dropped back slower, than next month.

    My guess – there were too many shorts and short positions were cashed out after nice drop, so this kind of supported front month price

  91. Phil

    NFLX/Rustle – I'm sure they are spending $50M on another show.  $460 is just too insane not to short, the next week $460s can be sold for $6.50 – that's my choice but, of course, VERY DANGEROUS!!!  

    KO/StJ – They raped MNST on that deal!  

    Austerity/StJ – Don't confuse them with facts.  

    $1Bn Website/Scott – That is, of course, incredibly misleading as it's the total cost of a coordinated national 50-state system and all the infrastructure, not the cost of the "web site".  Of course, the Fox crowd will have a field day with it over the weekend and it will be completely discredited next week but the talking point will have imprinted itself indelibly on Conservative brains by then. 

    Clearly CMS was put in a bad spot having to build a major first-of-its-kind system in a compressed time frame. One implication of this was that the bidding process had to proceed without completed specifications. CMS made many risky decisions in order to meet their goals, such as the use of "cost-plus-fixed-fee" contracts in the bid process and an Agile software development model, which was new to CMS. As the report notes (footnote 23), in 2009 the Office of Management and Budget released a Memorandum (M-09-25) calling for a reduction in the use of such high-risk contracts.

    Of course, throwing people and money at an IT project tends to make things worse, not better. And it's almost always a better idea to delay the rollout of a project than to launch with significant problems. But a launch delay was politically impossible, no matter how badly the project was going. The law said it would launch on October 1, so it had to launch on October 1.

    P/E/StJ – And I must post my usual objection that the "average" includes periods of unsustainably high bubble-levels of p/e that never should have occurred.  Shiller's p/e is more realistic as it eliminates fluctuations of the ratio caused by the variation of profit margins during each cycle.  Shiller uses 10-year average earnings, not one-year and adjusts for inflation (useful) and then adjusts back to current dollars – none of the others do that.  As I often point out, looking at charts (or data) without adjusting for the variation in the base measurement (dollars) makes all these charts useless.  

    Austerity/Toe – Compared to us or Japan, Europe had EXTREME austerity.  They didn't print money – end of story.  They didn't increase their debt either, they just cut spending to reduce debt.  That's what austerity is.  

    Very small dip in /CL but back over $97 now – seems like we're going to close (2:35) with Ukraine still a wild card (though Russia denies any sort of engagement at the moment) so no one wants to be short oil into the weekend.  It's generally keeping the indexes down as well.  

    Soros/Toe – Soros very much follows the Arnold Rothstein strategy – he watches, he waits, he pounces.  I call it investing because I consider doing nothing to be part of the overall strategy but his actual actions are fairly short-term.  He generally waits until something is about to break and then he breaks it by forcing the issue.  When he made $1Bn shorting the Pound, he made a $10Bn bet – and that was in 1992, when $10Bn was real money!  So, trick number one is getting $10Bn and then, trick number two is using it ruthlessly.  Soros went to the London School of Economics but got a Doctorate in Philosophy – that's my kind of trader!  Soros is a real fundamentalist though, he was "wrong" on the Pound for most of 1992 and he kept pressing and rolling until he was "right".  I have tried teaching people that strategy (reflexivity) but too many people follow the trades without adequate margin or capital to follow through and that ends badly – so I've decided not to even discuss those anymore.  

    TLT/Akad – Sorry, that was a bear put spread – good catch! 

  92. shadowfax

    Here we go again. Actual drug enforcement is not the issue, stopping flow of drugs isn't a goal, punishment like jail time not even considered. It is all about the money,  $1.6 billion fine to our justice department!

    https://finance.yahoo.com/news/fedex-indicted-criminal-charges-online-171340332.html

  93. Phil

    System/Shadow – That kind of stuff is ridiculous but the laws are written to deal with much bigger issues and then over-used by small-minded local enforcers, unfortunately.  

    Now we're flying back up as Russia says it was all BS.  I wonder what's true?

    /YM is the best long over 16,600 as it's likely to hold well enough to stop out on the way down. 

  94. Phil

    Oil/Lol – Well short-term, they may be a crisis that interrupts supply, making short-term oil more valuable.  Long-term, there's no real demand and plenty of supply – so the long-term contracts don't improve.  

    FDX/Shadow – I think a lot of this is just a stealth tax increase on Corporate America.  Money's gotta come from somewhere and there are PLENTY of companies out there breaking the rules.  

  95. stjeanluc

    Austerity / Phil – As opposed to extreme stimulus in China! yeah, they don't have the debt to GDP ratio of Japan, but how long can you pour 25% of your GDP in the economy no matter how big your reserves are?

  96. wombat

    lol ..>> good point

  97. Phil

    Rally looks out of gas already – /ES failed at 1,950, /TF 1,137.50, /YM 16,625 and /NQ 3,980. 

    Oil almost hit $97.50 but back to $97.15 as that was complete BS.  

    China/StJ – I don't know that they actually have any reserves left.  That or they are printing massive amounts of money but, by my count, they've stimulated about $8Tn in 4 years.  

  98. stjeanluc

    Europe / Phil – And BTW, Europe is going to end up with the same debt level we have or even higher because even if you reduce your budget deficit to 3% of GDP as required by their treaty (and countries are above that anyway, France is at 4%), if your grow only 0.2%, your debt level will increase faster. So the net result of austerity ends up with worse deficit and more suffering along the way. As predicted accurately by Krugman years ago!

  99. Phil

    Gold topped out at $1,310, Silver $19.75 – what a ride!  

  100. Phil

    Krugman/StJ – He and Stiglitz are the only two guys who seem to get it.  

  101. stjeanluc

    China / Phil – That's 100% of GDP in 4 years… Imagine $15T of stimulus in the US. Yes, we double the debt, but everybody has an electric car on brand new roads. We have solar panels on every roof and do not need another drop of oil. Unemployment is at 2%… And we repay that debt in 20 years with a brand new infrastructure. One can dream!

  102. stjeanluc

    Shit, we could give $40K to each person… That would stimulate the economy! And the rest of the world as everybody would run to buy crap made outside this country.

  103. News:

    George Soros loads up on bearish market bet

    The move sparked concerns that Soros Fund Management is expecting a big fall in equities.

    Read more: http://www.cnbc.com/id/101923426

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  104. News:

    Gundlach: Could see 10-year go to 2.2%

    Famed bond fund manager Jeff Gundlach on Friday warned yields on U.S. 10-year Treasurys could fall sharply, with momentum driving the market.

    Read more: http://www.cnbc.com/id/101906429

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  105. shadowfax

    STJ

    Your pressing republican values now, GWB sent out checks to stimulate, of course they were too small to cover the defaulting derivative bonds!

  106. News:

    Shopping for a car? Used auto prices take a tumble

    Used car prices are tumbling sharply and likely to slide through 2016, according to pricing trends.

    Read more: http://www.cnbc.com/id/101923519

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  107. News:

    Why this hot restaurant segment is plunging

    Fast casual is widely regarded as a bright spot in the ho-hum restaurant industry. Why then have some of the category’s stocks cratered this year?

    Read more: http://www.cnbc.com/id/101923031

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  108. News:

    Shake Shack preparing for an IPO: Sources

    The fast-food chain is preparing to go public, seeking to tap stock market demand for popular casual dining companies, according to sources.

    Read more: http://www.cnbc.com/id/101923805

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    and iPad

  109. rustle123

    I've never seen a shake shack that wasn't crowded.  I want in on that IPO.

  110. stjeanluc

    Hey Shadow, don't mention my name with GWB in the same sentence smiley

  111. stjeanluc

    In the meantime, look at that stick!

  112. Phil

    LOL Rustle, you are first supposed to read the article above it.  

  113. scottmi

    for any budding Speilbergs.. iPhone video editing app:

    http://www.editonthefly.com/

  114. shadowfax

    STJ

    Trying to guide you through the GOP traps!!! I am sure it was a slip up. I warned of our country would ends in riots and financial ruin in 1999 when that SOB got the nomination. I call him W for worst of everything.

  115. rustle123

    Shake Shack/Phil

    Oops.  But depending where they price it, they have a lot of expansion.  Think fast food like Wendy's, MCD, BK are slowly being replaced with CMG, Shake Shacks, LOCO, and some others.  If I was going to open a franchise, would not want some of the main ones anymore, high costs and not considered hip anymore or healthy comparatively to the new breed which are using fresh meat or organic ingredients.  And I definitely wouldn't open a frozen yogurt place, there's so many different ones and that fad came and went in late 80's to mid 90's and will do the same again.

  116. scottmi

    For the weekend.. Migration in the US.
    some interesting charts and maps

    Where We Came From, State by State
    http://www.nytimes.com/interactive/2014/08/13/upshot/where-people-in-each-state-were-born.html

    American Migration [Interactive Map]
    http://www.forbes.com/special-report/2011/migration.html

    A State-by-State Look at Where Each Generation Lives
    http://www.governing.com/topics/urban/gov-generational-population-data-maps-by-state.html

  117. shadowfax

    rustle

    These new types are designed for be tweens or the middle class. How smart is the management? Do they know they only will succeed in the few middle class places left in America? Do they know their target demographic is disappearing? The only survivor may be ultra high end, the rest of America is dumpster diving. 

  118. scottmi

    CREE/Phil – (any)where would you get excited for them again?

  119. Burrben

    Phil – Do you like VGR?  I was thinking of a buy write on it.

  120. shadowfax

    Papa Murphy's Pizza seems to have steady flows in the lesser markets and went public this year. Ate one 10 or so years ago and was quite good. I had 2 issues first the crust was raising to fast to get it home and heat the oven and personally the sauce was not close to eastern flavor I prefer.  

  121. rustle123

    @shadowfax

    I disagree.  I know many very well to do people that love CMG and Shake Shack in particular.  I'd say it's very popular with middle class and up.

  122. Burrben

    ZHNE Margin Q for anyone

    I have 2000ZHNE and I sold 10 of the Jan15 2.5 straddles.  So I actually have extra stock for the cover.  Anyway, IB is charging me $4750 in margin requirements even though the extreme risk margin is only about $450.  

    Weird right?

    What does TOS charge for that trade in margin?

  123. Jbur

    Burr:   TOS is showing me 5168.00 in buying power effect. The straddle is only about (460.00)

  124. shadowfax

    I agree middle class up I even went to CMG years ago but in depressed areas the Olive Garden and Lobster types are sending those once popular middle class places out of business. CMG has no restaurants around here and is Shake Shack smart enough to stay out of bad markets, even the $20 pizza chains are failing where middle class is a thing of the past.

  125. Phil

    Thanks Scott, Jackie will like that.  

    Shake Shack/Rustle – I went to the one in Paramus, wasn't overly impressed with the food but the kids liked the whole set-up, especially the make your own soda machines and milk shakes are a big +.  I wouldn't open any kind of franchise these days – food trucks are the way to go.  These guys do just french fries in the Village and it's $5 – here's your fries (which are great) and have a nice day.  Wash rinse and repeat 100 times an hour (at least) with a $4 profit (at least).  Now that's a business!    A food truck lets you pick just a few things that are easy to make and make a lot of money.  Figure out one (or ten) that works, get people to put up $50K for your "franchise" and collect 20% of what they make.  

    Cool infographic Scott – Way, WAY more people born outside the US than I thought.  Don't show me things like that – I can spend all day playing with them!  cheeky

    Middle Class/Shadow – There's 60M people in the top 20% who have no trouble buying that stuff.  CAKE, for example, has 200 restaurants with 200 seats each and figure 4 turns a day (generous) is 800 x 365 x 200 = 58M, so they are looking for each person in the top 20% to eat there once a year.  Not unreasonable considering that people eat 2 meals a day so they are looking to capture 0.5% of your food dollar (if you are in their target market).  Anything they get from the bottom 80% is a bonus, as is the loyal customers who eat there monthly or better.  What kills these businesses is over-expansion, not a lack of people with money.

    CREE/Scott – I like them at $40 and you can sell the 2016 $40 puts for $5.50 and consider that free money and use it to buy the $40/52.50 bull call spread for $5 and get a .50 credit for a spread that's $4 in the money to start.  

    The danger with CREE is they may take on debt to buy Philips (not me) LED unit but there may also be a mergery sort of thing depending on what Philips decides to do (it's supposed to be spun out regardless).  The company is priced about 16 times p/e net of cash with no debt, not too bad.  

    VGR/Burr – Nice dividend (8%) but tobacco is a tough business these days, so not for me. 

     Wow, was that the bell already?  Nice save into the close but still a damaging day.  All up to Putin this weekend.

    Have a great weekend everyone,

    - Phil

  126. angelcur

    it doesnt hurt that soros could have lunch w hans tietmeyer anytime he wished

  127. cturb

    Here's some news on TSLA. Maybe a pullback next week?  Elon acknowledges that this won't be good for TSLA shares

    The Tesla Model S drive unit warranty has been increased to match that of the battery pack. That means the 85 kWh Model S, our most popular model by far, now has an 8 year, infinite mile warranty on both the battery pack and drive unit. There is also no limit on the number of owners during the warranty period.

    Moreover, the warranty extension will apply retroactively to all Model S vehicles ever produced. In hindsight, this should have been our policy from the beginning of the Model S program. If we truly believe that electric motors are fundamentally more reliable than gasoline engines, with far fewer moving parts and no oily residue or combustion byproducts to gum up the works, then our warranty policy should reflect that.

    To investors in Tesla, I must acknowledge that this will have a moderately negative effect on Tesla earnings in the short term, as our warranty reserves will necessarily have to increase above current levels. This is amplified by the fact that we are doing so retroactively, not just for new customers. However, by doing the right thing for Tesla vehicle owners at this early stage of our company, I am confident that it will work out well in the long term.

    – Elon

  128. rustle123

    shake shack/Phil

    I love that shake shack.  Think their burgers are great.  As far as food trucks, I know a few people that run a fleet of them and it's had its day.  There is over saturation in many areas now and government regulation has affected them.  Some cities charge a decent amount for them to be in some spots or in the city.  Also fairs or farmer's markets that used to pay a fee to get food trucks there now charge them for being there since there are so many.  One guy I know who has five food trucks wants to get rid of 3 and open a restaurant instead because he's limited in the amount they  can sell during lunchtime and dinner.  Even though a small brick and mortars place would cost more, but not that much more since gas also has been a problem, he can do 5x as much business with the following he has now plus attract new people, providing he opens in the same area.  

  129. stjeanluc

    Fun at Vanity Fair – ideas for conservative kids books based on a real one:

    http://www.vanityfair.com/online/daily/2014/08/conservative-book-ideas

    Some good ones – a sample:

    If You Give a Moocher a Muffin



    . . . He’ll want health insurance and also a bridge to replace the one that collapsed out on the Interstate. Humorous situations reveal the slippery, not-so-humorous slope to collectivism.

    Are You There, God? It’s Me, Exxon



    A growing corporation realizes it has feelings too—and God and the Supreme Court are listening.

  130. stjeanluc

    Because that never happens in Washington:

    Rep. Paul Ryan finds "House of Cards" character Frank Underwood reprehensible.

    In an interview with Parade magazine, the Wisconsin Republican said he couldn't watch more than a few episodes of the Netflix political drama series because he was repulsed by Underwood — a calculating, murderous politician portrayed by Kevin Spacey — cheating on his wife.

    In the meantime, Frank has people killed, lives ruined but I guess that's OK. But cheating on his wife…

  131. Burrben

    No one mentioned GILD. Touching high 99s. Time for a 100/110 selling some 85s

  132. deano

    Burrben – yes, I did the 80/100s selling the 80s today myself. Pulled my lowest call (and put) and 2x'd my caller. If we climb more here I'll have to add some more, but I'll need to give it a few days. This one's been very good to me.

  133. News:

    Texas’ Perry indicted for coercion for veto threat

    Texas Gov. Rick Perry has been indicted for abuse of power after carrying out a threat to veto funding for state public corruption prosecutors. He denies breaking any laws.

    Read more: http://www.cnbc.com/id/101923733

    Sent from the CNBC app. Available for iPhone
    and iPad

  134. wombat

    palotay // CL
    well, I am sorry you hopped on this particular train. The handful of us that use this have been fairing very well ( between 70 – 120 % ) monthly. The idea is the arbitration behavior of the 'handoff'. Almost without fail, the day of expiration ( which was mistakenly yesterday ) is the closest the the two legs will come together, a squeeze from everyone selling off into the next front month. I think this was a perfect storm.
    I could go into my reasoning but you weren't the only one that took a cold shower. A few hedge fund friends had the same experience ( although very deep pockets ).
    Once all the global crap dies down I am going to start again with smaller amounts and keep learning. Contrary to a lot of opinions I find this much more comfortable than dipping in and out of futures. That being said, total P/L for the year is +47K with this 55K loss.
    Balls of steel are a bitch through airport security ; >

  135. wombat

    Palotay // CL
    I really do feel horrible you got stuck with this. however a few things I wanted to make clear.
    It's not the expiration of the futures were interested in – it's the expiration of the OPTIONS on the futures. In retrospect, I missed it by a day ( shame on me for being so relaxed, but I never expected a spike like that with a draw ) so again shame on me.
    I wouldn't venture in again until most of the global politics subsides or at least Sept expiration clears – this is where they shoot up to their base price again.

  136. bdonnelly713

    Phil, all, just wanted to throw my two cents in on the iceland vs usa graphic from the storm is coming facebook page. That facebook page posts a lot of memes like that but I've never been able to verify any of the numbers they put up. For example, listing Iceland as #1 in scientific literacy or USA as #31 in infant survival…I can't find any clearinghouse of information that shows that anywhere. The facebook page says they block or delete anyone that posts criticisms or questions of what they post as well or I would have asked them as a few of the other ones they posted about Norway's prime minister talking about financial bailouts were completely fictional as well. I get the general sentiment here and don't necessarily disagree but almost everything I've seen come out of the page with figures that was created by the facebook page itself and not sourced from somewhere else seems to have no actual basis other than whatever idea they wanted to try to push that day…which I find ironic since a lot of their posts rant about the powers that be deceiving people. 

  137. Phil

    Good morning!  

    They still can't get the facts straight in Russia:

    Iceland/Bdon – I see many things from Storm that I don't consider true "enough" to post but Iceland vs US is pretty accurate and the real point is to wake up people to some of the things we are slipping on in the US (well, everything, pretty much).  Here's a list with stats mainly from the CIA World Factbook, which has tons of data to go through on these subjects.  I'll list a few but, for future reference, if you are going to dispute something, please do your own homework rather than just say "that doesn't sound true so those guys are liars."  Also, I had no trouble at all posting a comment asking for sources on the statistics for that particular post.  Nothing was blocked or deleted and there are plenty of comments on other posts, both positive and negative.  

    I'm certainly not saying Storm Is Coming is an authoritative source, it's probably just some guy with a facebook page who gathers and posts Memes from the Web.  Sometimes I see ones I feel are worth posting, usually I don't but, if you think the US isn't woefully inadequate in many of these categories – then you really do have your head in the sand!  

    Democracyranking.org, who do nothing else, rank USA #12 but the 2013 Democracy Index places Iceland only 3rd but US fell to 21st.  

    Reporters without borders ranks the US 32nd in Freedom of the press, Iceland 9th.  Freedom House gives us 30th and Iceland 6th but actually Iceland is 3rd there because 3 guys tied for 1st (all Scandanavia), 2 for 2nd and 4 for 3rd so kind of arbitrary there.  

    Prisoners I'm not even going to look up – the US, with 5% of the World's population has about half of the World's prisoners – we are a psychotic society when it comes to locking people up and we have turned incarceration into a profit-making industry where prisoners are used as slave labor and the people who profit from that labor in turn lobby for tougher sentencing laws to insure themselves a constant supply of slaves  - don't even get me started!

    Corruption I can't believe we made 22nd.  I've worked in DC, I've owned businesses that sponsored politicians and consulted for others.  The only difference between the US (#19 here) and Haiti (163) or Venezuela (160) is that I can make one phone call in those countries and get a price quote and an introduction for whatever I want the Government to do while in the US, I have to work my way through a dozen dinners before I can buy the same service.  

    Anyway, I wasn't planning on spending my morning fact-checking so you can look up the rest yourself.  I don't mind having discussions like this but please come to them with your own fact, not the same vague, unresearched accusations you accuse the other guy of – that's no way to have an intelligent discussion, is it?  

  138. Burrben

    Deano – What was the net cost on that spread?

  139. stjeanluc

    Tough to read anything in yesterday's move with all the geopolitical background. The markets were up nicely until rumors of a Russian invasion of Ukraine derailed everything! In some ways, it shows the weakness of the market footings. 

  140. Phil

    Damn, other than the Nas, that chart looks indetermined.  RUT, Dow and S&P stopped by their dmas – that's going to make next week's opening moves very important.  

  141. stjeanluc

    Like you said Phil – down to Putin over the weekend… If tension rises, we could see some weakness next week. If Russia backs down, we could take off again.

  142. stjeanluc

    All the options expired worthless in the Strangles portfolio! 

    So far, so good!

  143. deano

    Burr – Net cost was 3.90, which I considered a bargain, though not as good as the first entry I made. BTW – nice article on GILD as well from a good source:

    Why Gilead Is The Most Exciting Growth Opportunity In 2014

  144. deano

    Burr – sorry, net on the GILD trade was actually 3.74, a little better than I thought.

  145. stjeanluc

    Not much going on until Wednesday when we start with the Fed's minutes and get a bunch of PMI numbers into Thursday!

  146. chasw

    Phil / Indices – All but the RUT ended above their strong bounce lines yesterday, yet the Levels Chart is indeterminate. Is this a head fake or a new leg up?

  147. palotay

    Wombat/CL – This loss just erased my gains for the year playing oil, so really not the end of the world (I started much later than you did).  I understand that the strategy focuses on options expiration, but the fact that the futures contract were going to expire on Tuesday means that we didn't have much time afterwards to recover if it didn't go our way.

  148. News:

    Exactly How Often Do Police Shoot Unarmed Black Men?
    http://www.motherjones.com/politics/2014/08/police-shootings-michael-brown-ferguson-black-men

  149. News:

    Awesome Things About Being Tall [infographic]
    http://www.longtiestore.com/tallhacks/awesome-things-about-being-tall-infographic/

  150. News:

    The Bond Market Explained for Mohamed El-Erian
    http://www.econmatters.com/2014/08/the-bond-market-explained-for-mohamed.html

  151. News:

    These Smaller Wal-Mart Stores Could Replace Supercenters
    http://www.businessinsider.com/wal-mart-neighborhood-market-strategy-2014-8

  152. News:

    Amazon makes play for online grocery market – but will it deliver?
    http://www.theguardian.com/technology/2014/aug/15/amazonfresh-online-grocery-market-amazon-deliver

  153. News:

    BoE’s Carney Says Rise in Real Wages Not Pre-Condition for Rate Hike
    http://www.nytimes.com/reuters/2014/08/16/business/16reuters-britain-boe-carney.html

  154. News:

    Wall Street ends mixed, recovers from Ukraine-driven slide
    http://www.reuters.com/article/2014/08/15/us-markets-stocks-idUSKBN0GF0XS20140815

  155. News:

    New Research Suggests That Development Aid Does Foster Growth
    http://www.businessinsider.com/aid-does-foster-growth-2014-8

  156. News:

    U.S. producer prices moderate as gasoline tumbles
    http://www.reuters.com/article/2014/08/15/us-usa-economy-prices-idUSKBN0GF11G20140815

  157. News:

    Wall Street Week Ahead: U.S. Stocks A Safe Haven, Even After Panic Selloffs
    http://www.businessinsider.com/r-wall-street-week-ahead-us-stocks-a-safe-haven-even-after-panic-selloffs-2014-15

  158. News:

    The economic imbalance fueling Ferguson’s unrest
    http://fortune.com/2014/08/15/ferguson-income-inequality/

  159. News:

    New FAA ruling effectively bans ridesharing for planes
    http://www.theverge.com/2014/8/16/6009055/new-faa-ruling-effectively-bans-ridesharing-for-planes

  160. News:

    Warren Buffett buys more GM stock
    http://money.cnn.com/2014/08/15/investing/buffett-gm-increase/

  161. News:

    As Europe’s Economy Stumbles, Britain Offers Some Glimmer of Hope
    http://www.nytimes.com/2014/08/16/business/international/as-europe-economy-stumbles-britain-offers-hesitant-hope.html

  162. News:

    Uber, Airbnb, and Others May Soon Accept Bitcoin
    http://time.com/money/3116974/uber-airbnb-and-others-may-soon-accept-bitcoin/

  163. News:

    Yahoo gobbles up another ad startup, ClarityRay
    http://venturebeat.com/2014/08/15/yahoo-gobbles-up-another-ad-startup-clarityray/

  164. News:

    Big Six energy firms to be opened up under Freedom of Information overhaul
    http://www.telegraph.co.uk/news/politics/11036823/Big-Six-energy-firms-to-be-opened-up-under-Freedom-of-Information-overhaul.html

  165. News:

    CHART OF THE DAY: How Apple’s Smartphone Strategy Is Different Than Everyone Else’s
    http://www.businessinsider.com/chart-of-the-day-how-apples-smartphone-strategy-is-different-than-everyone-elses-2014-8

  166. News:

    For the first time, more Americans subscribe to cable internet than cable TV
    http://qz.com/250254/for-the-first-time-more-americans-subscribe-to-cable-internet-than-cable-tv/

  167. News:

    Digital Video Ad Spend Is Surging As TV Dips
    http://www.businessinsider.com/digital-video-ad-surge-2014-8

  168. News:

    JCPenney’s Brief Stock Surge Is Over And Now It’s Tanking
    http://www.businessinsider.com/jcpenneys-10-stock-rally-vanishes-2014-8

  169. News:

    Investors Are Hungry for Food Startups
    http://www.entrepreneur.com/article/236459

  170. News:

    Regulators pushing banks to rid casinos of money-laundering
    http://www.reuters.com/article/2014/08/15/us-banks-casinos-analysis-idUSKBN0GF0BV20140815

  171. News:

    Walmart, J.C. Penney and Other Retailers See a Tentative Shopper
    http://www.nytimes.com/2014/08/15/business/walmart-lowers-forecast-as-us-sales-remain-weak.html

  172. News:

    U.S. retailers feel the pinch as frugal shoppers curb spending
    http://www.reuters.com/article/2014/08/14/us-usa-retail-idUSKBN0GE29H20140814

  173. News:

    Fast Food Companies Just Lost A Really Big Fight In California
    http://www.huffingtonpost.com/2014/08/14/california-franchise-bill_n_5679549.html

  174. News:

    Independent Scotland’s economy ‘would crash if it tried to use sterling’
    http://www.theguardian.com/politics/2014/aug/14/independent-scotland-economy-crash-sterling-ronald-macdonald

  175. News:

    Millennials Are Renting Instead Of Buying And The Retail Industry Is Freaking Out
    http://www.businessinsider.com/millennials-renting-instead-of-buying-2014-8

  176. News:

    Uber car service twists sharing economy into ‘sucker’s economy’
    http://www.marketwatch.com/story/uber-car-service-twists-sharing-economy-into-suckers-economy-2014-08-14

  177. News:

    Elon Musk’s SpaceX sued for labor violations
    http://money.cnn.com/2014/08/13/news/companies/spacex-lawsuits/

  178. News:

    Car Buying Site Beepi in Talks to Raise $50 Million
    http://recode.net/2014/08/13/car-buying-site-beepi-in-talks-to-raise-50-million/

  179. stjeanluc

    Questions that will never be asked on Meet the Press:

    http://www.huffingtonpost.com/2014/08/12/obama-iraq-criticism_n_5669444.html

    1. How many troops should we have left in Iraq?
    2. How long is long enough?
    3. Should troops have stayed in Iraq without a status of forces agreement?
    4. Would U.S. troops try to retake Mosul and Fallujah? You want another Battle of Fallujah?

  180. stjeanluc

    Quote of the day:

    Gatis Roze, “Investors don’t earn the right to use intuition in their trading until they’ve been investing for decades, not years.  All others must stick to their methodologies and learn how to execute these consistently and profitably.”  (StockCharts)

  181. stjeanluc

    I don't know that it's a good sign when the people who can afford to leave the country:

    http://online.wsj.com/articles/the-great-chinese-exodus-1408120906?

    Today, China's borders are wide open. Almost anybody who wants a passport can get one. And Chinese nationals are leaving in vast waves: Last year, more than 100 million outbound travelers crossed the frontiers.

    Most are tourists who come home. But rapidly growing numbers are college students and the wealthy, and many of them stay away for good. A survey by the Shanghai research firm Hurun Report shows that 64% of China's rich—defined as those with assets of more than $1.6 million—are either emigrating or planning to.

    The decision to go is often a mix of push and pull. The elite are discovering that they can buy a comfortable lifestyle at surprisingly affordable prices in places such as California and the Australian Gold Coast, while no amount of money can purchase an escape in China from the immense problems afflicting its urban society: pollution, food safety, a broken education system. The new political era of President Xi Jinping, meanwhile, has created as much anxiety as hope.

  182. bdonnelly713

    Phil, like I said, I don't disagree with the sentiment. I've just never been able to validate the numbers I see them using though – like you I get fairly different numbers/rankings/stats when I attempt to look them up. What is dishonest or intellectually vague about pointing that out? I apologize if I offended you. 

  183. Phil

    I was only "offended" by your assumption that I'd put up something that was blatantly false. If I am wrong on something, by all means let me know but, as I noted, the figures are in the ballpark, not misrepresentations. There's nothing to apologize for, other than making me look stuff up on my day off.  ????

  184. bdonnelly713

    Well, then I owe you an apology. I wasn't trying to say that you were intentionally putting up something  false. I'll try to be more precise:  Everyday, I see memetics circulated based upon all types of political ideologies that take extraordinarily complex issues and turn them into very straightforward ideas for quick consumption.  A side effect of this medium is that many memetics seem so indisputable when stated so simply that people who are already sympathetic  to whatever ideology is being propagated accept them without research. More importantly because they seems so "apparent" to those who already agree, they become highly agitated with anyone who questions the supposition. Overall, as I watch this play out daily I'm afraid we as a society, seem to have lost the ability to have methodical and respectful discourse about issues. As a result I've become fascinated with memes and usually try to verify a lot of them. 

    So again to clarify, I don't disagree with the sentiment but because I've not been able to find any numbers that actually match memes posted by that website, it makes me question the source. I'm afraid that people are taking an end justifies the means when arguing for something, particularly when broadcasting a normative opinion like that. For example, with this particular posting when I researched scientific literacy I find Iceland at 18 and the US at 14 which, considering ordinal rankings, is statistically very different from what the website posted as 1 and 33, or infant mortality rates with Iceland at 10 and the US at 51 vs the posting of Iceland at 1 and US at 31. In some cases the numbers are even BETTER for the argument than what is posted in the meme so I certainly wasn't trying to accuse you of misrepresenting something, but that was not the point I was trying to make. I have the same arguments with very conservative friends about the statistics used in pro-gun memetics that have numbers stated as facts that are attractive for the argument but just aren't verifiable. My interest and concern is with the methodology and the medium as they relate to the increasing popularity of memes, not necessarily the message or misrepresentation and I certainly wasn't' trying to imply that on your part. I've always viewed the board as a place where we can discuss these kinds of things so thanks for taking time to respond to what I had posted earlier. 

  185. Phil

    That's why, when I'm making statements in my posts, i always try to post a link to the facts I'm discussing as it's a pet peeve of mine when people dont.  Maybe that's why I've become so "influential"?   

  186. News:

    From Bloomberg, Aug 17, 2014, 11:15:01 PM


    Aug. 18 (Bloomberg) — Binay Chandgothia, a Hong Kong-based portfolio manager at Principal Global Investors, talks about the outlook for China’s economy and stock market.
    He speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Asian stocks fluctuated, after a
    five-day winning streak, as health-care shares gained while
    banks slid along with consumer companies.

    To read the entire article, go to http://bloom.bg/1qibUiI

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8

  187. News:

    From Bloomberg, Aug 17, 2014, 5:51:46 PM


    Aug. 17 (Bloomberg) — Kurdish forces retook part of Iraq’s largest dam after battling Islamic State fighters in nearby villages in an attempt to push back the Sunni-Muslim insurgents from the north with the help of U.S. airstrikes.
    Airstrikes yesterday against an Islamic State armed truck and a Humvee near Mosul Dam can be seen in this video provided by the U.S. Central Commmand. (Video courtesy of U.S. Central Commmand. Source: Bloomberg)

    Kurdish forces took control of most
    of Iraq’s largest dam as the largest U.S. deployment of air
    power in the campaign helped reverse some of the gains made by
    Islamic State militants in the north.

    To read the entire article, go to http://bloom.bg/1o2N70N

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8

  188. News:

    From Bloomberg, Aug 17, 2014, 11:09:36 PM


    Aug. 17 (Bloomberg) — Jinsong Du, head of property research at Credit Suisse Group AG, talks about a report showing China’s new-home prices fell in July and the outlook for the market.
    Prices dropped in 64 of the 70 cities that the government tracks last month, the National Bureau of Statistics said today. Du speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    China’s new-home prices fell in July in almost all cities that the government tracks as tight mortgage lending deterred buyers even as local governments eased property curbs.

    To read the entire article, go to http://bloom.bg/1vZiByN

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8

  189. News:

    From Bloomberg, Aug 18, 2014, 12:00:35 AM

    Aug. 18 (Bloomberg) — Bloomberg’s Toluse Olorunnipa offers a first-hand look at the protests and violence in Ferguson, Missouri in the wake of the shooting death of an unarmed teenager more than a week ago. He speaks on “First Up.”

    Hundreds of people rallied alongside
    civil rights activist Al Sharpton in a St. Louis suburb,
    demanding that the police officer who shot and killed an unarmed
    black teenager on Aug. 9 be charged with murder.

    To read the entire article, go to http://bloom.bg/1vZ7jKN

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  190. News:

    From Bloomberg, Aug 17, 2014, 5:00:01 PM

    Ukrainian border guards check people suspected of crossing the border illegally in the small city of Novoazovsk, Donetsk region, Ukraine, on the border with the Russian Federation, on August 15, 2014. Photographer: Alexander Khudoteply/AFP via Getty Images

    The Red Cross demanded safety
    guarantees before it begins inspecting the first 16 trucks from
    a convoy Russia says is carrying humanitarian aid at the
    Ukrainian border, as the nations’ top diplomats met to discuss a
    possible truce.

    To read the entire article, go to http://bloom.bg/1poZ1a3

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  191. News:

    From Bloomberg, Aug 17, 2014, 5:00:00 PM

    Men sit in a destroyed apartment building where they lived with their families in the neighborhood of Al-Shaas in the north of the Gaza Strip, on August 16, 2014. Photographer: Roberto Schmidt/AFP via Getty Images

    Israeli and Palestinian negotiators
    showed little movement from long-held positions ahead of a
    midnight deadline to extend talks that have kept the Gaza Strip
    free from military conflict for a week.

    To read the entire article, go to http://bloom.bg/YlPrLl

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  192. News:

    From Bloomberg, Aug 17, 2014, 11:22:07 PM

    Holders of China’s first corporate
    bond to default onshore plan to meet today in Shanghai, as
    investors look for clues on how the government will balance
    market liberalization with steps to maintain stability.

    To read the entire article, go to http://bloom.bg/1qiv7kd

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  193. News:

    From Bloomberg, Aug 17, 2014, 10:45:57 PM

    Anti-Occupy Central demonstrators carry a Chinese national flag during a march in Hong Kong, on August 17, 2014. Photographer: Lam Yik Fei/Getty Images

    Tens of thousands of people in Hong
    Kong marched to protest threats by activist groups to paralyze
    the city’s financial district if China refuses to allow direct
    leadership elections, underlining the division in the city.

    To read the entire article, go to http://bloom.bg/1oRYl8d

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  194. News:

    From Bloomberg, Aug 17, 2014, 4:01:00 PM


    A Russian armoured personnel carrier leads a column of military trucks as they leave the Russian-Ukrainian border area in the Rostov region, on August 17, 2014. Photographer: Dmitry Serebryakov/AFP/Getty Images

    Russian stocks fell in the U.S. while the biggest exchange-traded fund tracking the country’s companies pared a weekly gain amid renewed concern that the conflict with neighboring Ukraine is escalating.

    To read the entire article, go to http://bloom.bg/1uXT6tj

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  195. News:

    From Bloomberg, Aug 17, 2014, 11:49:31 PM


    A porter loads groceries on a tuk-tuk Thai traditional taxi at the Klong Thoei market in Bangkok, Thailand. The central bank said it expects the economy will improve in the second half of the year as fiscal stimulus spurs domestic consumption. Photographer: Dario Pignatelli/Bloomberg

    Thailand’s economy expanded more
    than estimated in the second quarter as local demand recovered
    after a military coup ended months of political unrest. The baht
    advanced.

    To read the entire article, go to http://bloom.bg/1uKOnOe

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  196. News:

    From Bloomberg, Aug 17, 2014, 11:41:03 PM

    South Korea’s record current-account
    surplus will boost the won to levels prior to the 2008 global
    credit crisis, JPMorgan Chase & Co.’s Seoul branch manager said.

    To read the entire article, go to http://bloom.bg/1sNYOjB

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  197. News:

    From Bloomberg, Aug 8, 2014, 12:00:01 PM

    Singapore Prime Minister Lee Hsien Loong narrowed the government’s forecast for economic growth
    this year and said the country must review its strategies as its
    needs evolve.

    To read the entire article, go to http://bloom.bg/1msDKYd

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  198. News:

    From Bloomberg, Aug 7, 2014, 2:10:22 PM

    Junko Otsuka uses a strimmer to cut bushes on the side of a mountain in Ome City, Tokyo. Photographer: Tomohiro Ohsumi/Bloomberg

    Junko Otsuka quit her job in Tokyo and headed for the woods, swapping a computer for a bush cutter and her air-conditioned office for the side of a mountain. She was part of a new wave of women taking forestry jobs, the result of economic, social and environmental policies sprouting in Prime Minister Shinzo Abe’s Japan.

    To read the entire article, go to http://bloom.bg/1uopcOJ

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  199. News:

    From Bloomberg, Aug 13, 2014, 2:22:07 AM

    China’s home sales fell 28 percent
    in July, the biggest monthly decline this year, as tight
    mortgage lending outweighed efforts by local governments to ease
    property curbs as prices and demand weakened.

    To read the entire article, go to http://bloom.bg/1mI3eRx

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  200. News:

    From Bloomberg, Aug 5, 2014, 1:32:42 AM

    Samuel Tsien, chief executive officer of Oversea-Chinese Banking Corp. Photographer: Bryan van der Beek/Bloomberg

    Oversea-Chinese Banking Corp. (OCBC),
    Southeast Asia’s second-biggest lender, reported its largest
    quarterly profit in almost two years on higher trading income
    and loan growth.

    To read the entire article, go to http://bloom.bg/1pUBbiT

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  201. News:

    From Bloomberg, Aug 15, 2014, 5:18:40 AM

    Chinese banks’ loan-loss reserves
    fell to the lowest level against soured debt in three years,
    signaling a looming drag on profits from the need to set aside
    more money as delinquencies rise.

    To read the entire article, go to http://bloom.bg/1pQKseA

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  202. News:

    From Bloomberg, Aug 18, 2014, 12:33:17 AM


    Jobseekers wait in line for the career counseling services at a career expo in Melbourne, Australia. The jobless rate Down Under surpassed the U.S. level last month for the first time since 2007. Photographer: Carla Gottgens/Bloomberg

    A deepening gloom across the largest developed economy to escape recession during the global financial crisis is shaping up as one of the toughest challenges yet for Reserve Bank of Australia chief Glenn Stevens.

    To read the entire article, go to http://bloom.bg/1sNUfWk

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  203. News:

    Watch this video at http://bloom.bg/YcPXuS

    August Empire Manufacturing Falls to 14.69

    Aug. 15: Scarlet Fu reports on the August decline in Empire manufacturing.

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  204. News:

    Watch this video at http://bloom.bg/YmFflC

    Shen Expects Further China Support for Property Market

    Aug. 18 (Bloomberg) — Shen Jianguang, chief Asia economist at Mizuho Securities Asia Ltd., talks about China’s property market, developers, and the outlook for government stimulus measures.
    He speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

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  205. News:

    Watch this video at http://bloom.bg/1ApSxvo

    Ferguson Police Use Force as Protesters Defy Curfew

    Aug. 18 (Bloomberg) — Bloomberg’s Toluse Olorunnipa offers a first-hand look at the protests and violence in Ferguson, Missouri in the wake of the shooting death of an unarmed teenager more than a week ago. He speaks on “First Up.”

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8

  206. News:

    From Bloomberg, Aug 18, 2014, 12:32:16 AM


    Aug. 18 (Bloomberg) — Binay Chandgothia, a Hong Kong-based portfolio manager at Principal Global Investors, talks about the outlook for China’s economy and stock market.
    He speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Standard & Poor’s 500 Index futures
    advanced while crude oil and gold slipped with Treasuries as
    Ukraine and Russia met for talks and Kurdish forces made
    progress against militants in Iraq’s north. Asian stocks
    fluctuated as Chinese new-home prices dropped.

    To read the entire article, go to http://bloom.bg/1qi6K6k

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  207. News:

    From Bloomberg, Aug 17, 2014, 7:01:00 PM

    London home sellers cut asking
    prices
    by the most in more than six years this month, adding to
    signs that the property market in the U.K. capital is coming off
    the boil.

    To read the entire article, go to http://bloom.bg/1qi4zzM

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  208. News:

    From Bloomberg, Aug 17, 2014, 5:01:00 PM

    EZchip Semiconductor Ltd. (EZCH) reported
    double-digit earnings and sales growth last week, beating
    analysts’ estimates for a second straight quarter.

    To read the entire article, go to http://bloom.bg/1rGaUa1

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  209. News:

    From Bloomberg, Aug 17, 2014, 4:01:00 PM


    Under U.S. and European Union sanctions, daily life for most of the capital’s 7.2 million people grows ever more difficult as food and fuel prices continue to rise. Photographer: Kerem Uzel/Bloomberg Markets

    On a May afternoon in Tehran, a Russian in a dark suit sits in the crowded lobby cafe of the Espinas Persian Gulf International Hotel with his Farsi translator, sipping coffee with potential Iranian partners while discussing the price of soy fiber. No sooner do they vacate their armchairs than another group of besuited businessmen takes their place, this time conversing in Italian and Farsi about industrial motors.

    To read the entire article, go to http://bloom.bg/1o32m9Z

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  210. News:

    From Bloomberg, Aug 18, 2014, 12:49:43 AM


    Masayoshi Son, Chairman and Chief Executive Officer of SoftBank Corp. Photographer: Noriyuki Aida/Bloomberg

    SoftBank Corp. (9984), the Japanese
    wireless carrier led by billionaire Masayoshi Son, plans to sell
    bonds for the first time after it abandoned talks to merge
    Sprint Corp. (S) with T-Mobile US Inc.

    To read the entire article, go to http://bloom.bg/1qiCbxj

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  211. News:

    From Bloomberg, Aug 15, 2014, 12:00:01 AM


    July 15 (Bloomberg) — Federal Reserve Chair Janet Yellen comments on the U.S. economy and the Fed’s policies.
    She speaks before the Senate Banking Committee in Washington. (This report contains excerpts of Yellen’s testimony. Source: Bloomberg)

    The U.S. labor market is looking a little surreal these days.

    To read the entire article, go to http://bloom.bg/1kFJxyr

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  212. News:

    From Bloomberg, Aug 15, 2014, 10:05:58 AM


    CityShares, founded by former Goldman Sachs Group Inc. analyst Seth Weissman, enables participants to reap rewards from increasing apartment demand in gentrifying areas. Photograph: Victor J. Blue/Bloomberg

    New York’s real estate world is filled with tales of ordinary people who bought property decades ago and saw values skyrocket to the millions. Seth Weissman is seeking investors to get in early on the next hot neighborhoods.

    To read the entire article, go to http://bloom.bg/1pQtBIO

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  213. News:

    From Bloomberg, Aug 15, 2014, 4:29:35 PM

    A Transmissions Grid Operations center in Portland, Oregon. Photographer: Natalie Behring/Bloomberg

    Payouts that reached almost $2 billion in the first quarter are attracting traders to the transmission-rights markets run by regional U.S. power-grid operators.

    To read the entire article, go to http://bloom.bg/1pvvyeF

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  214. News:

    From Bloomberg, Aug 15, 2014, 3:49:31 AM


    Aug. 15 (Bloomberg) — Trevor Greetham, director of asset allocation at Fidelity Worldwide Investments, talks about his strategy for European equities and bonds and his prefered industries in the U.S.
    He speaks with Manus Cranny, Mark Barton and Caroline Hyde on Blkoomberg Television’s “Countdown.” (Source: Bloomberg)

    Investors are turning against
    Italy’s government bonds as the euro-area’s third-largest
    economy falls back into recession.

    To read the entire article, go to http://bloom.bg/1t1o7gC

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  215. News:

    From Bloomberg, Aug 15, 2014, 9:12:04 AM


    Aug. 11 (Bloomberg) — Daragh Maher, a foreign-exchange strategist at HSBC Holdings Plc, talks about his strategy for the dollar and pound and the outlook for emerging-market currencies.
    He speaks with Mark Barton and Caroline Hyde on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    The fragile five emerging-market
    currencies are looking fragile again after a six-month reprieve.

    To read the entire article, go to http://bloom.bg/1t1ktU3

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  216. News:

    From Bloomberg, Aug 17, 2014, 10:02:24 PM


    View of a branch of ICBC (Industrial and Commercial Bank of China) in Rizhao city, east China’s Shandong province. Photographer: Imaginechina via AP Images

    China’s biggest banks, already
    poised for the weakest profit growth in more than a decade, risk
    a further erosion in earnings from record share sales intended
    to boost their capital after a credit binge.

    To read the entire article, go to http://bloom.bg/1vYYtg9

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  217. News:

    From Bloomberg, Aug 17, 2014, 7:01:01 PM


    European Central Bank President Mario Draghi acknowledged the slowdown of growth momentum earlier this month and said the trend reinforces the need for structural reforms, especially as “heightened” geopolitical risks “may have the potential to affect economic conditions negatively.” Photographer: Martin Leissl/Bloomberg

    Mario Draghi’s promise of cheap cash
    for banks betting on the euro-area revival is losing its allure.

    To read the entire article, go to http://bloom.bg/1qi6dkM

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  218. News:

    From Bloomberg, Aug 17, 2014, 7:01:00 PM


    Bank of England Governor Mark Carney’s focus on wages was promoted in the BOE’s quarterly Inflation Report on Aug. 13, when he said Britain’s expansion “faces some challenges.” Photographer: Simon Dawson/Bloomberg

    Mark Carney’s focus on weak wages to
    keep record-low borrowing costs is up against one key foe: the
    strongest economic growth in the Group of Seven.

    To read the entire article, go to http://bloom.bg/1qi5aBr

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  219. News:

    From Bloomberg, Aug 17, 2014, 10:11:05 AM

    Israel’s economy expanded at the
    slowest pace in more than a year in the second quarter as
    exports plunged, fueling speculation that the central bank may
    cut interest rates again to revive growth.

    To read the entire article, go to http://bloom.bg/1t7rP8r

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  220. News:

    From Bloomberg, Aug 17, 2014, 6:03:26 PM


    The best way to navigate all this bureaucracy.

    Every president has his method of taming the leviathan of bureaucracy. Harry Truman tried vast reorganizations. Lyndon Johnson preferred cerebral task forces. Jimmy Carter tried feeding the beast, George W. Bush starving it.

    To read the entire article, go to http://bv.ms/1t8oCp7

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  221. News:

    From Bloomberg, Aug 15, 2014, 6:05:12 PM


    We have a lot of Dark Ackman photos for some reason.

    I said this morning that I don’t understand Pershing Square’s lawsuit against the federal government for taking Fannie and Freddie, and now I’ve read it and I still don’t. It’s fine, it’s a perfectly serviceable lawsuit, but “Pershing Square’s complaint is at least the 20th lawsuit challenging the government’s decision to divert Fannie Mae and Freddie Mac profits to the Treasury,” and it’s not, like, full of pictures of Tim Geithner in compromising positions. I don’t know.

    To read the entire article, go to http://bv.ms/1sKah3w

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  222. Phil

    Good morning! 

    Futures are flying as we crack skulls of the bottom 99% from Ferguson to Iraq – go USA!!!  America F Yeah!  

    Missouri Governor Deploys National Guard - F Yeah! 

    Missouri's governor early Monday said he was calling in the National Guard to help restore order in the city of Ferguson after a night of clashes between protesters and police. 4:59 AM

    [image]

    Kurds, With U.S. Aid, Try to Take Mosul Dam - F Yeah!  

    Kurds Move to Retake Dam as U.S. Bombs Weaken ISIS - The Sunni militants appeared to be falling back on several fronts after two days of American airstrikes --  That was a pretty smooth transition from protecting people to all-out assault, wasn't it?  - F Yeah!   

    Britain Says Iraq Campaign Will Last ‘Weeks and Months’

    Pro-Beijing Camp Rallies in Hong Kong

    A countermovement to Hong Kong's pro-democracy Occupy Central is gaining strength as residents begin to bristle at the threat of mass civil disobedience.

    ?[image]

  223. Phil

    Oil PLUNGED all the way back to $94.40 as we get ISIS back under control and the Ukraine doesn't blow up and APA finds 300M barrels of oil in Australia – a place we don't usually find much oil:

    August 15th, 2014 at 10:53 am | (Unlocked)

    Oil/Rdn – We still have Ukraine and Iraq so $85 very unlikely at the moment.  $85 is the fair price for oil outside of geopolitics but there's always geopolitics so very tough to get there but demand is also weak so I'm not expecting a huge move up – just that $95.50 was a bit oversold SO FAR – enough to make a Futures long worthwhile but I'm not buying up USO or anything (and we just shorted XLE on the premise that we'd sustain low oil prices). 


     

     

    Wow, oil up to $97, up $1.50+ today.  That's one problem with shorting oil, you can get really whipsawed on any kind of disruptions.  Fun short at $97 (/CL) but need balls of steel.  

    This goes back to the conversation we keep having about FUNDAMENTALS – you have to know the fair price of a thing to trade it properly.  If you just go with the "trend" on a trade like this, you WILL get your face ripped off – you have to have some idea what something is worth (which, with a commodity, can change almost daily) and then, when it's high in the channel – you favor bear bets and, when it's low in the channel – you favor bull bets.

    We went long at $95.50 on Friday because up was easier into the weekend and then we flipped bearish at $97 because down was easier from there.  They did spike it up near $97.50 but having CONVICTION that we were at the top of the range allowed us to make good decisions and stick to the short side.  

    Speaking of which, Silver is back to the $19.50 line (/SI) which made such a lovely long last week as we caught a ride to $20 at $50 per penny ($2,500), per contract!  Same thing, we KNOW what silver is worth and it's more than $19.50!  

    Oil is a tempting long over the $94.50 line but SUPER-TIGHT STOPS BELOW IT!!!  We could be looking at a catastrophic failure with just 2 more days before they have to eat these September barrels:

    Click for
    Chart
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Sep'14 97.10 97.16 96.24 96.32 06:41
    Aug 18


    -

    -1.03 10868 97.35 86776 Call Put
    Oct'14 95.14 95.14 94.34 94.42 06:41
    Aug 18


    -

    -0.90 9155 95.32 284600 Call Put
    Nov'14 94.46 94.46 93.75 93.82 06:41
    Aug 18


    -

    -0.92 2203 94.74 127495 Call Put
    Dec'14 94.08 94.11 93.39 93.46 06:41
    Aug 18


    -

    -0.93 2775 94.39 220284 Call Put

    And look how jammed up we are into December – another month of fun ahead.  700,000+ barrels rolling around in those front months and it's difficult to roll past Dec (Jan just 80M) as that causes tax issues for traders – who never actually wanted the barrels in the first place.  

    With our inventories stuffed to the gills and demand completely dead – it doesn't matter how low they price oil – it's not going to move a significant amount of oil out of inventory – this market COULD collapse!  

    Of course, we could also escalate any of our 3 wars (Iraq, Ukraine, Ferguson) and prices could spike, so very dangerous betting in either direction at the moment. 

  224. cj50

    Hi Phil,  I have written an article that quotes you and I am writing to ask for your permission to print it on social media and if it is considered any good and requested then in other media too.  It has 2000 words, 10,000 letters that fills 3 A4 sheets with normal margins in full.  How do I send it to you?  Would you like me to print it on this box or would you like it sent to another e-mail address which you will send me?  Please let me know soon.  Thanks.

  225. Phil

    Sure, no problem CJ.  If you have a link, that would be better but, since it's the end of a previous session, no harm in printing it here – I'm sure many are interested in reading it. 

  226. cj50

    THE RISE OF THE MACHINES

     

    ‘There will come a time when only 200 people in the whole world will need to work.’

    Phil Davies, Investment Guru

     

    During my teenage years I would spend hours almost every day reading books, novels and comics.  One of my favourite genres was what is defined in the English dictionary as ‘fanciful fiction based on postulated scientific discoveries’ commonly known as Science Fiction (Sci-Fi).    These visionary authors wrote stories of fiction in an environment they would ‘foresee’ as coming about sometime in the future extrapolating on scientific discoveries and their implementation within greater Society.   Sci-Fi stories were concocted from the early 1900’s and amongst their early scientific visions were personal communicators for the entire planetary population, mechanised farms including crop production completely run by machines, mechanised factories run by armies of robots, robot-machine miners, robot run health and wellness facilities, worldwide production and distribution facilities run by robots, weather control,  infinite supplies of energy and medical advances that would bring about eternal youth. 

     

    The scientific discoveries that such novels spoke about held my adolescent imagination in thrall and the sciences and scientific literature became my favourite readings.  I would, even at that time, keep a watchful eye on how every new technical development or scientific discovery was leading the world closer to what these visionary science fiction authors had foreseen.  The authors talked of medical innovations.  In my pre-teen years and after, I had, thanks to profit focused opticians of the time, been saddled with thick eyeglasses.  I longed for the day when the medical innovation predicted by my favourite authors got rid of my glasses but did not think it would be in my lifetime.  One day, I noticed an article of how, for those with defective vision, Russian surgeons were slicing the eye cornea to alter their shape to give better vision. It was going horribly wrong in many cases but in the Soviet Union of the time, all was legal in the advancement of Science.  I felt the first flickers of hope that my day was coming.  Then some Western surgeons were using hot lasers.  Again, a significantly less than one hundred per cent success rate.  Finally cold lasers were developed and used successfully.  My day had come and a few years later I paid out a lot of money, every penny worth it, to a Canadian eye surgeon for LASIK.  My heavy eye glasses with their quarter inch thick lenses have been an emotionally satisfying relic ever since.  For a couple of years after, I would bring out my old now useless contact lenses and play tiddlywinks with them to spite them.

     

    However, I never thought I would live long enough to see their more innovative concepts in every day common global usage.  But here we are in the relative youth of my life with ubiquitous personal communicators (as foreseen in Star Trek), nano-robots, drones, laser and non-invasive surgery, metallic  external skeletons, 3-D printing, mass global communications on the Internet, holographic entertainment amongst many other technological wonders also about to come into every day common use and well within my current lifespan.  I have little doubt that a day will dawn when there will be no task that a computerised machine cannot do.  That day when almost no one will need to work is not too far away and perhaps within some of our lifetimes.  Everything will be planned, produced and serviced by robot machines at the beck and call of humans.  Armies and the police forces will be machines and robots.  All that humans would be left to do is eat, drink and basically idle their time away however they choose.  It was a theme that kept coming up time and again.  Arthur C. Clarke, an accomplished writer, explored and developed this concept the most as far as I could tell.

     

    The huge problem is that as machines replace humans at a rate that is accelerating none of the science fiction authors explored in detail the societal income and economics changes that are desperately needed to go hand in hand with scientific developments and lifestyle evolutions that must take place.    The sci-fi authors merely envisaged, that the necessary economic and financial changes required, would magically manifest perfectly and that there will be no problems over this.  No science fiction writer-author described the economic and financial workings of their well organised machine controlled global and/or galactic environment.   The reason is simply because they were not financial economics experts.

     

    Over the last 100 years scientific and technological advancement have been better and better rewarded by direct financial gains.  An individual or corporation that invents or develops an advance that trumps current technology can look forward to being quickly rewarded financially and in many cases very well.   Think Ford Model T vs. horse and buggy, MS Office vs. typewriters, internet banking vs. checkbooks and bank tellers and so on.  Thus personal goals and scientific/technological advancement trajectories are almost perfectly aligned in the same direction.  For this reason every new discovery or scientific law is closely studied and tenaciously adhered to in a fierce race to build on to the next scientific law and yet another invention, service and lucrative commercial patent.  This is what makes the absolute replacement of human employees by technological activity inevitable.  

     

    However Economic/ Financial Theory advancement, if it can be called such, does not correlate much with direct financial reward and certainly not quickly.  Economic and Financial Theories are often abstract, only rarely applied immediately, sometimes fiercely debated and challenged by a plethora of opposing theories and vested interests.  Some theories and concepts accepted after many years of debate and further study may then be taught in school/college text books at which time the author may collect royalty revenues normally many years after their initial submissions.  Sadly there is no aggressive study and adherence to one economic law or rule to race on to build another from it.  It is normally a slow laid back process.  It has become an increasingly common observation that politicians, corporations or wealthy individuals, once aware that a certain economic rule may infringe on their interests, employ all means available including character assassination and media campaigns to advance contradictory theories and rules valid or not in a bid to tear down the offending rule or theory.

     

    It is for the reasons stated in the last two paragraphs; the initially stealthy and now accelerating progress of science and technology in the developed nations that a well thought out workable economic and financial strategy that should have been in place to keep pace and deal with this is actually lagging tens of decades behind the current state of scientific and technological advances.  Economic rules and theories were applied for the common good of mankind for a large part of the 20th century but evidence shows that this process appears to have reversed after the mid 1970’s helped in large part by the rise of vested commercial interests.

     

    This malicious effect of economic advances lagging scientific advances is already upon much of the world.  Global employment levels in percentage terms are at an all time low and there is little to indicate that there will be any significant meaningful reductions in unemployment.  If anything the signs are pointing to higher unemployment levels worldwide and the wealth gap between the diminishing numbers of the rich and increasing numbers of the poor relentlessly widening.

     

    Consider the introductory scenario that only 200 people on the planet will need to work.  If so, will all wealth accumulate only to them?   When we reach a stage where so few need to work, how will everyone else, that is, many billion people acquire money to live on?   Many are currently smug that they will never be replaced by software or a machine and point to the Industrial Revolution as the economic model for precedence.  That is, that they will train themselves in another line of work and that so called human ingenuity will prevail.  Let us take a leap of faith and fast forward to the future time when machines and software have the ability to do everything.  In such a scenario there will be no other line of work to re-train up to because if there is, the machines will learn at virtually the speed of light to do it.

     

    Some will say, for example, they own apartments for rental income and these will continue to pay income.  This would be true if their tenants have an income to pay their rent with but not otherwise.  The wealthy of such an economic environment will not rent their residence or office; they will own vast swathes of land and large buildings if not entire cities.

     

    Many look upon the jobless as worthless, good-for-nothing lazy individuals who ‘have only themselves to blame’.   But as the numbers of jobless individuals’ increase they will, as is the nature of humans, form organised gangs and cults. Driven by this attitude against them and with nothing to lose most will organise and operate on the wrong side of social equity.  The French Revolution is a great example of when this occurred.  Historical records say that the few elite rich were forcefully and violently pulled out of their homes and unceremoniously decapitated before cheering crowds.  However this did not immediately result in a better society in France.  The country struggled with mass lawlessness and violence for a very long time before peace was restored and the rule of law and this time a much more equitable rule of law was established.  It seems that this is a scar that still sits on the French national psyche.  They currently have one of the most advanced socialist systems in the world as do the Scandinavian nations and the Canadians amongst some others.  It is the societies of these countries that will cope best with the inevitable rise of the machines.  This is because they are the ones that will most likely re-distribute the wealth derived from automated organization and production systems to the citizens so that they will have enough to live on.  These nations will find a way to ensure their citizens are provided a decent level of guaranteed income, employed or not, to consume what the machines produce.  They will ultimately develop a self sustaining, self perpetuating economic machine in harmony with technology.

     

    Nations that do not have a socialised outlook will allow their entrepreneurs to monopolise production, buying up all competitors and land so that the poor are increasingly forced to live in slums or worse.  The rich business elite will buy up all politicians and easily fully control the media to attempt to mislead public opinion to their financial advantage.  However, as less of the population earn living wages, the low tax rates they will have ensured the politicians have put in place will result in decreasing tax collection volumes.  This will lead to lower social and infrastructure maintenance and ultimately a failed, violent, miserable state.   The machines will be used to oppress rather than liberate the masses.

     

    It is instructive that science fiction authors somehow intuitively grasped onto this future dichotomy and constructed stories based on both, that is, States where the machines controlled by a few oppress the citizenry and States where machines help create a utopia. 

     

    It is becoming more urgent and imperative that economists and financial researchers focus their efforts to develop methods that equitably re-distribute the wealth created by greater automation.

     

    In conclusion it must be reiterated that the inevitable progress of science research and technology will elevate the few nations who place a high priority on social welfare and equity to far greater heights of mass prosperity and well being for its citizens.  The same progress of science and technology will accelerate the demise and final failure of the other nations to extreme levels of poverty, violence and misery as the number of unemployed inevitably and relentlessly grow at the rate of millions and no social welfare funding and distribution systems are in place to ensure the masses maintain a decent level of income to live on. 

  227. cj50

    As you may notice a lot of it is inspired by your writing.  You are free to suggest amendments.  Thanks.

  228. Phil

    Very nice but it's Phil Davis, not Davies!   That's the Kinks side of my family…

  229. cj50

    Ok, sorry, consider that corrected.  Is investment guru ok?  Anything else?  Please let me know.

  230. Phil

    It should be "profit-focused" opticians (and grammer is always less important to me than readability!).  Of course, a statement like that causes me to drift off your paragraph and begin considering how old you are and at what point they developed thin glasses and whether or not your optician was actually to blame or whether they were doing the best they could at the time.  To some extent I know that's my mental ADD – since my brain is always flying off on tangents while it waits for my slow eyes to get on with the next word – but I'm pretty sure you don't want to distract a reader with your person feelings about opticians at this stage in the narrative.  I would go with "I was cursed with uncomfortable, thick eyeglasses – makes you more relatable.  

    With them to spite them is weak – how about "with them out of spite" or pure spite?

    However, I never thought I would live long enough to see their more innovative concepts in every day common global usage. - who is "their" I lost track?

    The huge problem is that as machines replace humans at a rate that is accelerating none - needs "," after that and accelerating

    No comma after envisaged or required – not a big fan of "and that" in the same sentence.  

    financial economic experts weak, I'd go with just Economic 

    I'd replace scientific law with scientific advancement 

    slow, laid back

    theories and rules, valid or not, in 

    I'm not a great editor (as you can tell from my own articles) so that's certainly not inclusive – just things I caught. 

    One thing I would change is where you say: Consider the introductory scenario that only 200 people on the planet will need to work.  If so, will all wealth accumulate only to them?    I think you should try to make a point about the way automation funnels wealth to the owner of the machine and away from workers (if they exist at all in the new equation) and more automation will inevitably lead to more funneling of wealth.  I think if you establish it there – the last few paragraphs read better as you are keying off a notion you accept but your reader might not have at that point.  

  231. Burrben

    Phil –  On the /SI long.  I'm thinking that this trade isn't a scale in/scale out.  We are looking for /SI to move and we would be willing to hold overnight for a week or so until we get the price or the loss that we are looking for.  

    Correct?

    If so, what would be the "mental" stop paramemter?  19.25?

  232. Phil

    /SI/Burr – Well, it's get out of $19.45 doesn't hold and I think $19.67 (halfway to $19.75) is likely to be a tough cross and then, of course .75 so I'd take money if rejected and just try to get back in on a cross.  We still have panic into the Dollar so this stuff can be very jumpy.  Certainly at $19.75 on a clean run, I'd be thrilled to take $1,250 and run if it gives us any trouble at all.  

    You can't stop $19.25 on silver, that's a huge loss.  Even a nickle move against you can cost you $250.  

  233. checho

    TASR/

    http://nypost.com/2014/08/15/taser-sees-demand-for-police-cameras-after-ferguson-shooting/

    They are coming around to Phil's investing premise….

  234. cj50

    I had stepped out for some 15 minutes.  A huge thanks for the feedback and your points are great.  Btw I am 56 years old and had LASIK done in 2001.  Once done I take it I have your permission to send it out?

  235. ricbah

    Phil- how do you feel about /TF at 1150?

  236. cj50

    I have done the changes including your name.  Would you like to see it again?

  237. Phil

    Yes on permission, CJ.     If you repost it here, I'll get to it later but don't wait on me as the day is starting. 

    /TF/Ric – See new post, I'm still favoring the short side but tight stops if we're over the lines.  

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