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Monday Market Movement – Dead Week Ahead

Why are you here? 

I told you it was going to be a pointless, slow week.  You need to take advantage of these things and take vacations.  Surely you didn't become a trader so you could be chained to a desk all day, right?  Get out there and have some fun, the market will still be here when you come back.  

We took a quick $338 per contract profit off the table already on our oil shorts and that's a nice $3,380 on 10 contracts to fly us down to Florida and have a big old turkey dinner with the family and THAT is why I like being a trader – just a little bit of work for a lot of reward (after putting in years and years of hard work and practice, though).  Still, the point is you have to learn to enjoy yourself, that's why our tag-line is: "High Finance for Real People – Fun and Profits."  If you're not having any fun – what good are the profits? 

Related imageAs I noted in our Portfolio Reviews last week, we're trying to emphasize the LONG-term investing strategies.  Futures trades like the one above are fun but they are a lot more fun when you KNOW you have a good collection of stocks working for you 24/7 to keep new money pouring in.  In the case of our Long-Term Portfolio (LTP), we're collecting $50,000 a year in dividends alone and we just added another dozen big dividend-paying stocks to our Watch List.  

Our Portfolios have been pretty much locked in neutral since October, with only our Buttefly Portfolio putting up big returns because it's already self-hedging and doesn't really care whether the market goes up, down or sideways.  If I had to trade just one strategy the rest of my life – that would be the one I'd pick (though I'd be SO bored!).  Boredom is why we play the Futures.  Good trading is BORING – it's supposed to be boring as you grind out steady, consistent gains.  If your tading is exciting, you are probably doing it wrong…

One of our Memberships at PSW is our Top Trade Alert and we've sent out 6 Alerts in the month of November – all bullish.  Those trades were:

Top Trades for Thu, 02 Nov 2017 12:01 – TEVA, M & CBI

Top Trades for Mon, 06 Nov 2017 12:12 – DIS

Top Trades for Thu, 09 Nov 2017 10:03 – M

Top Trades for Fri, 10 Nov 2017 11:40 – TWTR

Top Trades for Tue, 14 Nov 2017 15:37 – NVS

Top Trades for Fri, 17 Nov 2017 15:51 – GT

Not a bad set of earnings picks, right?  Of course our Top Trade Alerts are only a small sample of the Trade Ideas we share with our Members every day at PSW but they are, generally, the ones I feel have a very high probability of success.  Generally, we don't make risky trades our Top Trades – the options spreads we select are generally long-term (in case we're wrong and need to adjust) but they can still give you a huge, short-term pop if you get them right.  For example, we liked Macy's (M) so much we picked it twice, on Nov 2nd it was:

  • Sell 10 M 2020 $15 puts for $3 ($3,000)
  • Buy 20 M 2020 $18 calls for $4.20 ($8,400) 
  • Sell 20 M 2020 $22 calls for $3.10 ($6,200) 

That's a net credit of $800 with $8,000 more upside at $22 and the worst case is being assigned 1,000 shares at net $14.20, which is 25% below the current price.  Upside potential is $8,800 (1,100%).

That one was ahead of earnings and you would think 2020s would change that much but, already, the $15 puts are $2.58 ($2,580) and the $18 ($5.55)/22 ($3.53) spread is $2.02 ($4,040) for net $1,460 and that's up $2,260 (we had a credit in our pocket already), which is up 282% in less than a month but that's only "on track" for our expected 1,100% gain and it's still good for a new trade as there's another $7,740 (342%) left to gain from here.  

Related imageThat's why, going into Thanksgiving, M is still a contender for our 2018 Trade of the Year.  As I noted above, we like it so much that, after earnings on the morning of the 9th, we were SHOCKED that M hadn't rocketed on what we thought was a great earnings report so what else could we do but send out another Top Trade Alert to our Members (in case people hadn't already grabbed them).  This one said:

M/Jabob – Over $18 already, silly boy.  cool  Earning $3 per $18 share could be my Stock of the Year for next year since LB has gotten away from us.  

In the very least, M should be a Top Trade today as we can certainly say we'd LOVE to own them at this level:

  • Sell 10 M 2020 $20 puts for $6 ($6,000)
  • Buy 30 M 2020 $15 calls for $5.20 ($15,600) 
  • Sell 30 M 2020 $22 calls for $3 ($9,000) 

That's net $600 on the $21,000 spread that's $3 ($9,000) in the money to start (but you have to clear $20 to cash in the longs without impairment).  Seriously, this would be my Trade of the Year for 2018 if it were Thanksgiving at this price!   M is already in the OOP and LTP and I'll consider later if I want to adjust but today's report justified our targets.  

Notice we were more confident and more aggressive this time, having had a chance to hear the earnings report that was nowhere near the disaster people thought it was.  We took the more aggressive 2020 $15 calls, bought 50% more of them and paid for them by aggressively selling the $20 puts because, as I said, I would LOVE to own M for $20 in 2020.  

On this one, the $20 puts have fallen to $4.95 ($4,950) while the $15 calls are $6.85 and, as above, the $22 calls are now $3.53 for net $3.32 ($9,960) on the spread and that's a net of $5,010, which is up $4,410 (735%) in 11 days.  It's also still good for a new trade as the goal at $22 is $21,000, which is another $15,990 (319%) from here – so still good for a new trade if you were smart enough to save $3 a day by not being a subscriber.  

Image result for long-term investingThis is why I ignore day trades and most short-term trades.  We can make PLENTY of money making sensibly leveraged long-term trade.  After all, what is my risk on the above "aggressive" trade.  That M ends up below 20 and I have 1,000 shares assigned to me at $20 plus the $600 we spent on the spread (and assuming we let the spread go worthless) so the net is $20.60, barely higher than if I just bought the stock.  

But, if we had just bought the stock, we'd be up about $2,000, not $5,010 and we would have laid out $18,000, not $600 (plus $5,747 in ordinary margin).  What's the downside to making a sensible options spread instead of swing-trading a stock?  I was just on Benzinga's Pre-Market Show and I did tell them that the first M trade is likely our Trade of the Year for 2018.  I'm sure, in the end, there will be an adjustment but I can't think of a trade I feel has better odds of returning 300% than that one.  

Meanwhile, I'm trying to practice not talking politics for Thanksgiving so you can read Trump's weekend tweets yourself if you want to know why we've parked our portfolios in NEUTRAL for the Holidays with plenty of CASH!!! on the side – just in case WWIII breaks out while we're at Mom's house…

Earnings reports are still trickling in and we like Lowes (LOW), GameStop (GME) and Medtronic (MDT) and Tuesday and Deere (DE) on Wednesday and LOW is still pretty cheap at $80, GME really cheap at $16.30, MDT under $80 ($79.50) is a good buy too  but DE already blasted higher, so no interest there.  

I'm have some plays on those in our Live Member Chat Room after a bit more investigation.  There will be Fed Minutes on Weds at 2pm but I'll be on a plane – so good luck with those!  We have Leading Economic Indicators today at 10 and the Chicago Fed and Home Sales tomorrow with Durable Goods and Consumer Comfort/Sentiment on Wednesday.  So far, dissatifaction with the President hasn't spilled over to dissatisfaction with the economy but watch out if it does.

As I told Benzinga, we expect the markets to hold up into the Holidays but January is looking very scary indeed.  By the way, those 597,893 open December oil contracts I told you were fake, Fake, FAKE!!! back on October 31st?  Today is the last day of trading and, as of Friday's close, only 31,377 contracts remain but oil prices have gone UP $3 since then.  All but 50,000 of the 1.3Bn contracts that were open in the front 4 months are still in the new front 4 months and the rest were rolled to longer months

Click for
Chart
Current Session Prior Day Opt's
Open High Low Last Time Set Chg Vol Set Op Int
Dec'17 56.69 56.76 56.18 56.24 07:42
Nov 20

 


-
-0.31 3448 56.55 31377 Call Put
Jan'18 56.80 56.93 56.29 56.37 07:42
Nov 20

 


-
-0.34 144707 56.71 595210 Call Put
Feb'18 56.88 56.98 56.38 56.44 07:42
Nov 20

 


-
-0.37 27861 56.81 190625 Call Put
Mar'18 56.93 57.00 56.41 56.46 07:42
Nov 20

 


-
-0.41 17661 56.87 300887 Call Put
Apr'18 56.83 56.98 56.45 56.46 07:42
Nov 20

 


-
-0.43 14958 56.89 134760 Call Put
May'18 56.73 56.85 56.32 56.35 07:42
Nov 20

 


-
-0.46 5120 56.81 105949 Call Put
Jun'18 56.55 56.69 56.15 56.18 07:42
Nov 20

 


-
-0.47 10481 56.65 234321 Call Put

It's ALL FAKE!!!  I'm showing you very simply that it's a complete and utter scam yet Congress can't seem to figure that out and we ALL pay for their incompetence/complicity at the pump.  Remember that when you are gassing up your car this weekend – these traders CANCELLED contracted delivery of 564,000,000 (95%) barrels of oil that were supposed to be moving into inventory in December and your oil and gas prices went UP 5.5% this month.   

They won't even end up taking delivery of 31M barrels, likely less than 20,000 open 1,000 barrel contracts will remain at the end of the trading day – all just to screw you over at the gas pump.  But you don't mind, do you – it's just a little screwing – a few more Dollars each time you fill up is only what, $200 a year per car?  It's nothing to complain about – just another one of the daily indignities that we suffer but there's 200M drivers suffering and that's $4Bn a year in profits from this scam.  

It would make a great class action suit!  

Don't bother writing to Congress – write to your attorney!  

 

 


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  1. Good Morning.


  2. Guidelines – Nice to see someone agrees with me….. :)


  3. Good Riddance – Charlie Manson. Dead.


  4. Good morning! 

    Big Chart – Back over the 50 dmas on NYSE and RUT means "all is well".  

    Oil a bit lower than where I cashed out but happy to be done with it for the moment. 

    /KCH8 nice and cheap again at $125.50.

    /NGV8 also good for a long at $2.998 – typical Monday sell-off. 

    Manson/1020 – And what exactly was the point of keeping him alive for 40 years?  In those kind of cases, I am pro death penalty.


  5. Phil / LT portfolio review.  Did the email go out on this one?  I saw the email on the OOP Portfolio but not the LT.  thanks, 






  6. Donald Trump is playing zero-dimensional chess (again)


  7. TEVA down 4% dangit! 

    any news?


  8. Jabob – But FTR up nicely.


  9. Sex scandals wreak havoc on Florida politics





  10. anyone here?


  11. there we go, sorry


  12. albo--i want FTR up too but it is pretty much dead money for me unless a miracle happens in the next two months. I have a bunch of 10-15 Jan 18 call spreads that basically became worthless after earnings. 


  13. GOOGL/Phil

    Thanks for you trade idea last Thurs…just got to reading it as I have been busy..

    I would say it’s a little aggresssive, but I may jump into it, if this darn market dips a little, at least?



  14. How GOP Tax Policy Clobbers College Borrowers



  15. Jabob -I understand.  I'm sitting with a pretty big loss in CTL myself..  But buying some here and will sell my higher cost stock for tax loss prior to year end.  Believe CTL's dividend is secure and would think that FTR cuts their dividend another 40-60%. But that's just my opinion and I could be wrong.


  16. LTP/Batman – Don't think it was Emailed but posted Friday and I'll finish the combined review today and post it.

    TEVA/Jabob – No news I see but probably profit-taking at $14.

    Now oil is coming way down, testing $56.

    GOOGL/Maya – Well, it you want to play it that way, that's the way I'd go.

    FTR/Albo – At this point, not cutting a $2.40 dividend on a $7.40 stock is just weird.  They are going to pay an 0.60 dividend in two weeks so will the stock drop 10% on ex-dividend?  Kind of crazy.

    /TF making a tempting short if it tests 1,500.  1,497.50 is worth a poke short if it fails there.  

    Meanwhile, I see no news justifying this rally.  IBM is lifting the Dow with a $2.50 gain – another Trade of the Year contender (again).  HD is also up $2.25, BA up $2 but the rest of the index is barely moving.  


  17. Jabob – That guy has been reading my mail. 8-)


  18. Solarcoin is catching a bid finally. This was one of the first alts I got interested in after bitcoin (early 2013). Of course, it's been one of the crypto laggards (murphy's law). It taught me a lot about GPU mining and all that jazz though, so a good learning experience. I recall mining ~300 per week for a couple of months back in the day. I also put a little into Power Ledger. The concept looks interesting… IF they can execute on the idea (big "IF" with these coins, they can also be total scams, especially ICO's since they pay the founders BEFORE the work gets done — an idea I ultimately don't like and think is very "crypto"). It's up today too though, maybe Green Energy and Carbon related digital assets are coming around.


  19. Question from Friday post:  Phil; 2 questions if you have time this weekend.  I noticed you wanted to protect the gain on the AAPL 150 calls in the LTP and rolled out to 2020.  Why not do the same with the 140 calls in the Butterfly?  The second question has to do with your trade idea from yesterday in GOOGL.  I spent a bunch of time today trying to understand how you could lose on that trade.  I realize there is no such thing as a guarantee but can you explain the risk on that trade?   I realize that if the stock goes up significantly the short calls will be under water, but between rolling those calls and adjusting the bullish call spread it seems low risk.  I apologize if the answer is obvious.


  20. Greencoin/BDC I picked up some GRE at coinexchange.io and would like your recommendation on a wallet to keep it. Or should I just leave it at coinexchange.io? Thanks.


  21. jeluntuck/GRE

    I bought few using my bank account and it is saying 10 days to arrive. How did you buy it? Was it immediate availability?

    regards


  22. As usual, whenever Trump is in trouble, he lashes out at someone.  Now he's sanctioning NoKo after spending a year saying Obama's sanctions were ineffective.  

    At what point does his base wise up?

    Oil bounced back fast but I still missed 0.50 of the fall…

    /TF failed at 1,499.3.

    Solarcoin/BDC – Good call on them.   GreenCoin backing down again but still some volume

    AAPL/Options – I answered that this morning.  Short story is the Butterfly is smaller and more conservative – so we're happy to just take the win. 

    Greencoin/All – Don't forget, if you are buying it for 0.00035, you want to put in an order to sell 1/3 at 0.001 so you get your money back if it pops and the rest is a free ride.  You get 1M coins for $350 and, if they get to $1, you'll have $650,000 instead of $1M but, since the chances are MUCH more likely they go to 0.00000000000 – you'll have saved $350 and you can move on the the next coin or DD on the next low cycle.  


  23. Pat, I moved some Bitcoin to coimexchange.io and bought GRE. I think it then became available to withdraw right away.


  24. jelutuck/GRE

    Oh ok. I guess it is taking 10 days to get the bitcoin itself. once I have those I can covert them to GRE immediately I guess.

    regards


  25. Phil,

    How do you play /CL and /RB for the rest of 2017? I’m thought is they run up this week where it may be a chance to short going into December expiration. Is this correct thinking?


  26. Also, what’s you /KC position now?


  27. Pat, that makes sense. Converting dollars to Bitcoin takes about a week at Coinbase. Once you have Bitcoin all other trades happen in a few minutes.


  28. 1020 – "Good Riddance – Charlie Manson. Dead."

    Phil – "Manson/1020 – And what exactly was the point of keeping him alive for 40 years?  In those kind of cases, I am pro death penalty."

    Prior to his release from a third prison term in 1967; Chucky had spent more than half of his 32 years in prisons and other institutions. Telling the authorities that prison had become his home, ol Chucko requested permission to stay, a fact mentioned in a 1981 television interview with Tom Snyder.

    Of the Chuckster's 83 years on this planet, 62 were spent institutionalized and imprisoned. At an averaged annual cost of 45K over the 62 year span, not including court, administrative and the cost in human lives, society spent $2.8 MILLION to house, feed, provide healthcare and keep Charlie away from the rest of us in a humane fashion.  

    Unfortunately, in this case of definitive guilt, the snuggie Thuggee neck tie, red top hat, lead poisoning, Belsen cough drops, lights out IV, sit down with Ol Sparky, or the dead man walkin never came. As they say, no clean hands in a dirty business, but I digress…

    This week we will have extra cause for Thanksgiving, as that waste of skin should have been put out of our misery long ago in 1972.   Time for my IV and Out.


  29. Greencoin/biodieselchris

     

    Coming late to the game.  I know all of this has been explained…can you point me to (an) explanation(s) of the steps to purchase Greencoin?  I understand that I must purchase Bitcoin first.  Your name no longer links to Crypto Corner. TIA for your help!

     



  30. Phil, BDC, Jel, Pat – Crypto currency - Now here's something, as this author points out how,  regarding what defines "money" and its status,  it appears that in the crypto currency world, BTC is emulating in many ways, what the USD has achieved in the legal tender world.  Interesting reading in this week's TV Guide? Wink, wink and Out.


  31. Crypto Corner/emailmike

    Thanks!


  32. coinexchange.io says the green coin wallet is offline. This is a red flag, it means people cannot send coins they may want to to sell to the marketplace and this could create an artificial market price. Why not just buy other coins instead? Use Bittrex (better, more reliable falcon exchange) and pick some asset issues from there. Just IMHO.


  33. Hmm…I think Naybob is hitting the IV early during the holiday week!


  34. /CL/Japar – I'm leaving Weds for Florida so I'm not playing at all.  I thought we'd run up into Thanksgiving after the rollover (today) and it looks like we bottomed out at $55.25 – higher than I thought but what can you do?  We'll have to see what the barrel count looks like in a month but they knocked this one down with only that one big selling day – so very impressive rolling.

    The next big event will be the holiday consumption numbers.  

    /KC/Japar – 2 long /KCH8 @ $127.175 avg – under water at $126.10 so far.  Was hoping for $123 so I could avg $125 on 4 but hasn't gone that low.

    Crypto/Naybob – Lots of ways to look at it but only time will ultimately tell if this is some great opportunity or great folly.  


    • Oct. Leading Indicators+1.2% to 130.4 vs. +0.6% consensus, +0.2% prior (revised).
    • Coincident Economic Index +0.3% to 116.2.
    • Lagging Economic Index +0.2% to 125.5.

    Yellen confirms plan to exit Fed

    • Janet Yellen's to be replaced as Fed chairman by Lawrence Powell, but her term on the Board of Governors doesn't expire until 2024. Not surprising anybody though,  she's submitted her resignation from the central bank, to be effective once Powell is sworn in.
    • The move means yet one more vacancy to be filled.
    • "The authors have received several questions about the composition of the underlying data set they used in their analysis," says the bank. "The authors are currently revising their paper to further clarify the data sample they used in the study. Their revised paper will be posted as soon as it is completed."
    • Previously: Cleveland Fed slams P2P lending (Nov. 13)
    • Among interested parties: LendingClub (LC +0.2%), OnDeck Capital (ONDK +0.2%)
    • Chinese equities have reversed losses that came after regulators unveiled fresh initiatives to curb risk in the asset management industry.
    • The sweeping regulations, which will affect some $15T of financial products, will prohibit asset managers from promising investors a guaranteed rate of return and require them to set aside 10% of the management fees they collect for provisioning purposes.

    Merkel wants new elections

    • Following this morning's collapse of talks to form a coalition government, Angela Merkel says she's in favor of new elections rather than trying to put together a minority government, and she intends to run again.
    • The euro (NYSEARCA:FXE) has slipped a bit further since the news hit, now down 0.4% vs. the dollar to $1.1741. Germany's DAX is higher by 0.5%EWG +0.2%
    • Whether related or not, gold (NYSEARCA:GLD) has slumped to its session low, now down 1.4% to $1,280 per ounce.

    Blockchain passes Wall Street test

    • "We know the thing works now," says Axoni CEO Greg Schvey, whose firm just managed a six-month test of blockchain in the $2.8T equity swaps market. Among participating banks were JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS), Citigroup (NYSE:C), Credit Suisse (NYSE:CS), and Canada Pension Plan Investment Board.
    • The program kept track of the swaps contracts, and recorded items like amendments or termination of deals, splits, and dividends. The success rate was 100%, says Axoni.
    • "Fewer valuation disputes, less reconciliation and real-time access to data would benefit all of the industry,” says Citigroup's global head of prime finance, commenting on the benefits of blockchain. Accenture estimates investment banks could save $8B.

    FT: ConocoPhillips sets $50/bbl price ceiling for new oil projects

    • ConocoPhillips (COP -0.1%) will invest only in new projects that can be profitable at an oil price of below $50/bbl, trying to maintain cost discipline despite the rise in oil prices since June, CEO Ryan Lance tells Financial Times.
    • Lance also says COP will commit most of its growth investment to North American shale oil resources in North America, arguing that operations there are most able to respond to volatile markets.
    • “You don’t even get through the door unless you are below $50 cost of supply, and you don’t really get to the table in the capital allocation fight unless you are $40/bbl or below,” the CEO tells FT.
    • COP is planning to increase capital spending to an average of $5.5B/year during 2018-20, up from $4.5B this year, as it seeks to drive production growth, which the company forecasts at 3%-6% next year, excluding the lost output from assets it is selling, and ~5%/year on average.

    WSJ: Oil companies, automakers seek lifeline for internal combustion engine

    • Exxon Mobil (NYSE:XOM), BP, Royal Dutch Shell (RDS.ARDS.B) and other oil companies are spending millions of dollars per year working with automakers including Ford (NYSE:F) and Fiat Chrysler (NYSE:FCAU) to improve the internal combustion engine and help it compete with electric vehicles, WSJ reports.
    • The companies are hoping new, thinner lubricants will help squeeze even more efficiency out of traditional car engines, allowing them to comply with stricter environmental rules and remain relevant as new technologies such as zero-emission electric vehicles emerge.
    • The efforts come as the combustion engine faces new threats, as countries including the U.K., France, China and India have signaled that they plan to ban sales of vehicles with traditional engines in the coming decades.
    • “It’s really important that we are able to squeeze the lemon,” said Andrew Hepher, Shell's VP of global commercial technology. “The combustion engine has still got a long way to run.

    Volvo to supply Uber with self-driving cars

    • Volvo (OTCPK:GELYF) strikes a deal to supply Uber (Private:UBER) with tens of thousands of self-driving cars after autonomous models from the automaker are ready for production.
    • "Everything we’re doing right now is about building autonomous vehicles at scale," says Uber exec Jeff Miller in a dramatic statement.
    • Uber and Volvo have been partnering on autonomous R&D for over two years. Uber also has partnership with Daimler (OTCPK:DDAIF), while rival Lyft (Private:LYFT) has tie-ups with General Motors, Jaguar Land Rover and Ford.
    • Ford (NYSE:F) says it will offer a hybrid police sedan next summer based off the Fusion model.
    • The automaker says it will have a range of 21 miles and top speed of 85 miles per hour on only batter power. The combined gas-electric range is over 500 miles. The model will be aimed at police and fire personnel not involved in pursuits.
    • Earlier this year, Ford unveiled plans for a pursuit-rated hybrid police vehicle based off its Interceptor model.
    • BYD (OTCPK:BYDDFOTCPK:BYDDY) has ambitious goals to become a new energy powerhouse, according to South China Morning Post.
    • BYD Chairman Wang Chuanfu thinks revenue could soar 10X to 1T yuan ($150.7B) by 2025 as the local EV market accelerates. The exec is known for his bold prediction that all cars in Mainland China will be electric by 2030.
    • The company plans to set up different divisions covering the passenger vehicle, commercial vehicle, battery and electronics business lines.
    • Berkshire Hathaway (BRK.ABRK.B) holds a 24.6% stake in BYD.
    • Japanese property owners and businesses near the Fukushima nuclear plant that melted down after a 2011 tsunami have filed a $500M class-action lawsuit against General Electric (NYSE:GE), which designed all six reactors at the facility.
    • Original plans for the power plant called for it to be built near a bluff 115 feet above sea level, but GE – to save money – lowered the bluff to 80 feet, which "dramatically increased the flood risk," according to court papers.
    • GE said it became aware of the lawsuit on Sunday and is "thoroughly reviewing the matter."

    • The fast food business is far from dead, observes Nation's Restaurant News editor Jonathan Maze.
    • Quick-service restaurants outperformed fast casual chains in Q3 (+1.1% vs. -2.4%) as menu innovation continues to contribute. Solid same-store gains were recorded by McDonald's (NYSE:MCD), Del Taco Restaurants (NASDAQ:TACO), Burger King (NYSE:QSR) and Taco Bell (NYSE:YUM) among others.
    • Maze says if there was one winner in the entire sector it was Domino's Pizza (NYSE:DPZ). The pizza chain's same-store sales of 8.4% obliterated the pace seen by peers during the same quarter. Papa Jophn's International (NASDAQ:PZZA) and Pie Five (NASDAQ:RAVE) in particular struggled during the quarter.
    • Nobody has to tell McDonald's shareholders about the turnaround of fast food sentiment. The share price of the Golden Arches is up 38% YTD to more than double the 15% return of the S&P 500 Index.

    Investors confident on Lowe's ahead of earnings

    • Lowe's(LOW +1.8%) trades strong into tomorrow Q3 earnings report as investors hope for the retailer to see the same hurricane-related bounce as Home Depot.
    • Consensus estimates on Lowe's stand at revenue of $16.57B and EPS of $1.02. Comparable sales are expected to rise 4.2% and a gross margin rate of 34.3% is anticipated.
    • Stifel Nicolaus says it expects Lowe's management will raise full-year sales guidance.
    • Bloomberg reports that options trading implies a 3% move up or down in Lowe's share price following the report.
    • Lowe's hit a 52-week high of $86.25 in May.

    Sotheby's updates on auctions results

    • Sotheby's (NYSE:BID) reports that global auctions last week brought in $852M, boosted by strong demand for contemporary art.
    • "Our flagship sales of Impressionist & Modern and Contemporary Art achieved strong year-over-year growth this week, delivering great results for Sotheby's consignors and investors, and enticing bidders across categories and price points," updates Sotheby's CEO Tad Smith.
    • "We head into 'A Life of Luxury' week in New York and our Old Masters sales in London with great momentum," he adds.
    • The top lot of the week was the $38.6M for Francis Bacon's "Three Studies of George Dyer."
    • Source: Press Release

    Marvell confirms $6B deal for Cavium

    • The cash and stock deal values Cavium (NASDAQ:CAVM) at $80 per share. Consideration for each Cavium share will be $40 in cash and 2.1757 Marvell (NASDAQ:MRVL) shares.
    • The deal is seen generating at least $150M-$175M of annual synergies within 18 months after the close, and is expected to be significantly accretive to revenue growth, margins, and non-GAAP EPS. The sale is expected to close in the middle of 2018.
    • Marvell CEO Matt Murphy will run the merged company, and Cavium CEO Syed Ali will continue as strategic advisor and member of the board.
    • Alongside, Marvell expects Q3 revenue to be $610M-$620M, and EPS of $0.32-$0.34, ahead of the most recent guidance.
    • A conference call is set for 8 ET.
    • Source: Press Release
    • MRVL +1.3%, CAVM +7.5% to $81.50 premarket
    • Previously: WSJ: Marvell Technology set to buy Cavium in ~$6B deal (Nov. 19)

    Theater stocks in retreat after Justice League disappoints

    • Theater stocks are in reverse after box office numbers for Justice League disappointed.
    • The Warner Bros. superhero film failed to reach $100M for its opening weekend and only earned a B+ rating from CinemaScore.
    • Decliners include AMC Entertainment (NYSE:AMC-4.8%, Cinemark Holdings (NYSE:CNK-2.8%, IMAX (NYSE:IMAX-2.8%, Regal Entertainment (NYSE:RGC-2.8%, Marcus Corp (NYSE:MCS-1.6%.

    KeyBanc: EA shouldn't cut in-game prices, but raise them

    • Electronic Arts (EA -0.8%) -- dinged of late due to a fan backlash tied to in-game costs on its high-profile Star Wars: Battlefront II -- should actually boost prices, according to KeyBanc.
    • In a note to clients, analyst Evan Wingren says negative reactions are presenting a share-adding opportunity not only for EA but for rivals Activision Blizzard (ATVI -0.5%) and Take-Two (TTWO +0.1%) as well. He's reiterated Overweight ratings on all three, with price targets of $134 for EA (currently at $107.96), $78 for ATVI (now at $63.77) and $144 for TTWO (currently at $117.94).
    • EA suspended in-game purchases, and while Wingren says that was handled poorly, it's a transitory risk: "Gamers aren't overcharged, they're undercharged (and we're gamers) … This saga has been a perfect storm for overreaction as it involves EA, Star Wars, Reddit, and certain purist gaming journalists/outlets who dislike MTX [microtransactions]."
    • An hour of gaming is still cheap compared to other entertainment like movies rented or in-theater, or pay television, he says.
    • There's a slightly higher risk now that the game will miss his forecast of 13M units sold, he writes.
    • Previously: BofAML analyst says EA could lose money on "Star Wars" game concessions (Nov. 17 2017)
    • Bloomberg reports that Qualcomm (NASDAQ:QCOM) investors want at least $80 per share from Broadcom (NASDAQ:AVGO).
    • Broadcom had offered $70 per share in its unsolicited bid, which the Qualcomm board rejected. 
    • Broadcom CEO Hock Tan hasn’t increased an opening offer over 6.8% while his company picked up a series of acquisitions including Brocade. 
    • A similar increase in the Qualcomm offer would equal just under $75. 
    • Qualcomm has a weakened position due to ongoing legal battles with Apple that led to the loss of royalty payments. 
    • The dragging NXP Semiconductors acquisition has also made Qualcomm more vulnerable.   
    • Previously: Step forward for Qualcomm-NXP deal (Nov. 19)

    • Nomura Instinet reiterates a Buy rating for Amazon (NASDAQ:AMZN) but increases its price target from $1,100 to $1,360.
    • Analyst Simeon Siegel cites Amazon’s “deepening” moat and expanding profit margins. Siegel forecasts margins of 45% to 46% by 2022 compared to the 35% estimated for this year. 
    • Key quote from analyst note: “We took a deep dive into Amazon's margin structure, & backing into segment GMs, we believe that mix shift alone could drive 1000+bps of LT GM lift, powering a $160bn investment into deepening Amazon's moat."  
    • Amazon shares are down 0.3%.    
    • Previously: GBH Insights raises Amazon price target ahead of "blowout" holiday quarter (Nov. 20)
    • Amazon (NASDAQ:AMZNlaunches AWS Secret Region, a cloud data center region for U.S. intelligence services.
    • Government agencies outside the intelligence community can use the region if the agency has high enough clearance.
    • Amazon launched GovCloud for public sector customers six years ago.
    • The CIA signed a $600M AWS contract in 2013.  
    • Previously: Nomura Instinet raises Amazon price target on margin potential (Nov. 20)

  35. Phil,

      Thanks for your thoughts on /CL. Do you think we'll see it back down to $50 after the new year? Also, any update on the hedge fund? I have not received anything from Greg. Also, wanted to talk to you about it. What's better for you today or tomorrow after market close?


  36. Deano – "Hmm…I think Naybob is hitting the IV early during the holiday week!"

    That's just the thang…  Remember, respect the dirty bird or fear the kickin' chicken.


  37. Oil/Japar – We're into a whole new thing now with the Aramco deal pending.  There's $2Tn on the line for the Saudis and, for the Prince, his life is on the line too.  What won't they do to get the price of oil higher?  As to the hedge fund, we've already gotten money from most people and trading officially begins on 12/1.  Yes, call today if you need to – you should have all paperwork by now.  

    • Cash and liquid investments of U.S. companies not in the financial industry will total $1.9T at year’s end, according to Moody’s.
    • The total represents about a 5% growth on the year. 
    • Top five by cash: Apple (AAPL -0.1%), Microsoft (MSFT), Alphabet (GOOGL), Cisco (CSCO+1.5%), and Oracle (ORCL +0.3%). 
    • The top five will hold about $679B of cash or about 35% of the total.
    • Moody’s expects the tech sector’s cash share to rise to almost half of the non-financial cash holdings this year, compared to 47% last year. 
    • Offshore cash, which could benefit from the Republican tax plan, could total $1.4T this year or 72% of the total cash. 
    • The top five will have $594B or 88% of their cash overseas.  
    • Source: MarketWatch     
    • Previously: Google cuts prices on Compute Engine GPUs (Nov. 20)
    • Time Warner (NYSE:TWX) shares are taking a sudden dip, down 1%, on word that an impending antitrust announcement involves news of a Justice Dept. lawsuit to stop a takeover by AT&T (T +0.8%).
    • Developing story …
    • Action at the CME actually looks like it will start on Globex on the evening of Sunday Dec. 10, but it will be for Dec. 11 trade date.
    • Each contract will be for five bitcoin, with minimum ticks of $5 per bitcoin, or $25 per contract.
    • Special price fluctuation limits will be 7%/13%/20% above/below the previous day's settlement.
    • Contract specs

    • After a weekend with a relatively disappointing showing from high-profile superhero combo Justice League (TWX -0.7%), it was Lions Gate that scored a moral victory in theaters.
    • Justice League dominated ticket sales but at $96M didn't crack the $100M barrier, while the No. 2 film, critically strong Wonder (LGF.A -0.4%LGF.B -0.2%), opened to a strong $27.1M against that competition and in many fewer theaters.
    • Thor: Ragnarok (DIS -0.5%) fell to third with $21.8M but still held up strong considering the hero-based competition, and counterprogrammed comedy Daddy's Home 2 (VIA -0.3%VIAB +1%) fell into the fourth spot with $14.8M.
    • Justice League's opening was the worst of any of the films in the DC Extended Universe so far, despite sky-high expectations. International figures helped, with an added $185.5M in 65 markets, for a debut worldwide total of $281.5M; the film drew an estimated $51.7M in China, Box Office Mojo notes.
    • Thor: Ragnarok, meanwhile, hit $247.4M in cumulative domestic grosses, and reached a total of $739.3M worldwide.
    • Previously: Theater stocks in retreat after Justice League disappoints (Nov. 20 2017)

    So much for cloud profits:  Google cuts prices on Compute Engine GPUs

    • Google (GOOGGOOGLcuts its price of Nvidia Tesla GPUs attached to its on-demand Google Compute Engine virtual machines by as much as 36%.
    • The price cut means the newer, high-performance P100 machines will cost about $1.46 per minute in the United States. 
    • Google will also lower the price of preemptible Local SSDs by nearly 40%, putting US costs at $0.048 per GB-month.  
    • Previously: Google buys Denmark land for potential data center (Nov. 20)

  38. Bitcoin futures / Phil – Do you think this is just another chance for the big financial plaf

    ers to manipulate via paper similar to oil and precious metals?  Scarcity of supply or lack thereof doesn't seem to be the primary driver for oil and gold.


  39. Hi Phil could you give me Greg email again for the hedge fund information

    Thanks

    Jackie 


  40. Bitcoin/Stu – Of course it is.  There are only 21M Bitcoins and they are going to start trading Futures on them and setting up ETFs?  The whole thing is insane.  $5Bn of oil is consumed every day ($1.8Tn/yr) and there's $11Tn worth of gold moving around and THOSE are manipulated all the time.  Imagine what you can do with $168Bn worth of BitCoins total, 90% of which are parked in people's wallets.  

    Fund/Gucci – Greg is: Admin at Philstockworld dot com.  


  41. Entertainment/all – With the spate of superhero movies in the US, Korea has tried their hand at it in a TV series format. Try this – https://www.dramafever.com/drama/4988/Strong_Woman_Do_Bong_Soon/- for a distinctly Korean take on a superhero. It's the usual 16 episode TV series (they usually do one season of a show and out here). Subtitled, so you can learn Korea while watching it.  ;)


  42. solarcoin tanked hard on high volume ($6M+). Ouch!




  43. U.S. Sues to Block $85.4 Billion Merger Between AT&T and Time Warner







  44. Phil some thoughts for early risers.

    ABBV I am holding the Jan 19 50/60 BCS with a delta of 90/88. The stock has risen from 58 to 98 over the last year. Obviously an impressive rise! Looking a bit in to the future how much more does one expect this stock to climb? The BCS has cost me, not considering the sale of the Jan 19 putter 4.90 per option.

    Closing the BCS will bring me about 9.20 out of the max 10 $ spread. Now normally one could roll the BCS to Jan 20 say 80/95 with a credit of ONLY 1.80 but widening the spread by 15 $ or even 80/100 with a debit of just .18 cents. Now looking in to the future, thinking the market will rise forever, this would possible be a good move.

    On the other hand the 4.90 to 5 $ gain will most likely withstand any drop in the market over the next year, and one just should carry on selling monthly calls against the present position. The chances of the stock will still go further the 100 will be very slim in my point of view, taking the uncertain market position in consideration.

    I hold quite a few BCS in my Tree planting holdings, showing similar positions, as well in different markets.Possible some more silent members are in the same boat, if they tree planter!

    You might say this is a bio stock and you can not compare it with AAPL or GOOGL or AFL, just to name a few.

    To me rolling a stock like GE or even ABX, or worse BHGE, being at the low end of the scale, is a much better move.

    Interested to hear your point of view. TIA


  45. Yodi/ ABBV – there are 423 days left until the Jan 19 expiration date, so with  $0.80 left to gain in that period, or $0/00189125 per day. It all comes down to inventory management – I would want to be turning cash over much faster than that. The tree is mature, cut it down and use the proceeds to plant another against which you can sell your 'cherry' calls.


  46. Yodi – I too would move on from this trade, and perhaps sell a few puts down the road on a dip. One of the tougher things I have learned is that you can't fall in love with your positions, and when you're near the max its likely time for fresh horses. For me a recent example is IBM – after earnings it rose as high as 162.5, and back down last week to 146.5. Dumped my call spread at the high, re-entered after the drop. Pretty good volatility for a dow stock.


  47. Good morning!

    Futures up again on no volume.  There will be Hell to pay – eventually…

    Europe is up too but they are way behind us:

    Nikkei is splitting the difference:

    Oil back to $56.50 but too scary to short.  /RB just under $1.75, probably a better long than short into the weekend. 

    Still likin' coffee in the morning (/KCH8) 

    /YG looks good at $1,278.  I'd play long over $1,280.  /SI is always a buy at $16.90.

    What did poor Australia and New Zealand do wrong?

    And Canada

    Not printing enough money, I guess?  

    So I'm 8 short /TF at the moment at 1,508 avg.  Stopping out over 1,510 with an $800 loss but really I'm playing for whether I take the family out to Nobu on Friday or Burger Fi (which is excellent, by the way). 

    Can't believe Charlie Rose is now in trouble for harassment – and it must be bad because he's already off the air.  I watched his show almost every day (or listened to it, anyway), he's a good interviewer.  

    • The allegations keep coming… CBS, PBS and Bloomberg have suspended Charlie Rose following a Washington Post report in which eight women claimed he sexually harassed them .
    • Glenn Thrush has also been suspended by the New York Times (NYSE:NYT) following accusations of sexually inappropriate behavior toward women.
    • It comes as 21st Century Fox reached a $90M settlement tied to its company sexual harassment scandal.

    People are freaking out about the DOJ going after TWX.  

    • After a couple of weeks of heavy discussion around the regulatory prospects for AT&T's (NYSE:T) long-in-the-making $85B plan to take over Time Warner (NYSE:TWX), the Justice Dept. says it's filing suit to stop the deal.
    • The DOJ formally announced its opposition minutes ago. T closed up 0.4% and is up 0.5% after hours; TWX closed down 1.1% in regular action and is down another 0.3% postmarket.
    • “This merger would greatly harm American consumers," says DOJ antitrust chief Makan Delrahim. "It would mean higher monthly television bills and fewer of the new, emerging innovative options that consumers are beginning to enjoy."
    • Rivals would be forced to pay hundreds of millions of dollars more per year for Time Warner networks, the department says.
    • It also argued that the lawsuit wasn't influenced by President Trump, or by anyone else in the White House.
    • Delrahim is known to favor structural remedies (like asset sales) over behavioral remedies like those applied in the (similar) Comcast-NBCUniversal deal, which he has suggested don't work.
    • The deal was first reached more than a year ago — in October 2016 — and its fate was subject to heavy speculation after President Trump (who had vocally opposed the deal in the weeks leading to the U.S. presidential election) won the presidency.
    • AT&T got its response out ahead of the DOJ's statements, calling the suit "radical" and "inexplicable."
    • The key to the deal may not rest on sorting out an eventual winner/loser in the suit — if the matter takes enough months to resolve, AT&T and Time Warner may elect to walk away from the deal.
    • United States v. AT&T, DirecTV Group Holdings and Time Warner
    • DOJ news release

    • AT&T's (NYSE:T) gotten out ahead of an expected Justice Dept. announcement that it's suing to block an AT&T-Time Warner (NYSE:TWX) merger, saying the suit is a "radical and inexplicable departure from decades of antitrust precedent."
    • "Vertical mergers like this one are routinely approved because they benefit consumers without removing any competitor from the market," says AT&T General Counsel David McAtee II. "We see no legitimate reason for our merger to be treated differently."
    • The deal will make TV more affordable, innovative, interactive and mobile, he goes on. "Fortunately, the Department of Justice doesn't have the final say in this matter. Rather, it bears the burden of proving to the U.S. District Court that the transaction violates the law. We are confident that the Court will reject the Government's claims and permit this merger under longstanding legal precedent."
    • AT&T's Randall Stephenson is set to speak at a 5:30 p.m. press conference about the deal.
    • We're still awaiting a news conference from the DOJ confirming news that it's suing to block the deal.

    • Speaking at a news conference in reaction to a DOJ lawsuit seeking to block the $85B AT&T-Time Warner merger, AT&T (NYSE:T) CEO Randall Stephenson said "We're surprised to be here, and candidly I'm a bit troubled by it."
    • The best legal minds in the country agreed this deal would be approved," he said, and the government's suit "stretches the very reach of antitrust law beyond the breaking point.
    • Stephenson pointed to media rivals he says have further reach: Netflix and 100M customers, Amazon video in excess of 60M, "Google and Facebook — literally billions of customers." Turner (NYSE:TWX), meanwhile, has single-digit share of all media watched, he says, and AT&T has 25M TV customers.
    • "We don't intend to settle this matter out of simple expediency," Stephenson says, suggesting a quick resolution may not be on the way. The rule of law's at issue, he says.
    • "Frankly, I don't know" whether the lawsuit is about CNN, he says, pointing to an "abrupt change" in the application of antitrust law. But any agreement that results in the company forfeiting control of CNN is a "nonstarter," and he argues that divesting assets from AT&T or Time Warner isn't required by the law. AT&T will offer solutions that get the deal to closure.
    • After hours check: T -0.1%TWX +0.3%.

    Good point by someone saying that BABA's claim to have sold $25.3Bn in one day is essentially impossible.  They sold $158Bn all of last year ($500M/day) so 50x a normal day and that's assuming the $158Bn number isn't BS in the first place.  AMZN does $135Bn but, more to the point, SHLD does $22Bn all year and M $25Bn and they have thousands of stores and hundreds of thousands of employees while BABA has 57,302.  Maybe they are the most amazing thing that every existed but maybe its a con?  

    Strong Woman/Snow – That seems cool.

    AABV/Yodi – I agree, those gains are much more likely to have a harsh reversal.  If you are going to roll up a position, you have to strongly believe in the higher strikes.  I prefer to put money into the stocks that are still cheap as, for one thing, they should have less downside if the market turns sour.  I sure wouldn't wait a year for 0.80 unless you can do very well selling calls (compared to GE or ABX or one of our other Watch List plays).  The thing is, they make harsh moves, so selling calls is a bit dangerous too.

    • General Electric (NYSE:GE) board member Francisco D’Souza is the latest director to step in with a purchase after the stock slumped to the $18 level, buying 55K shares today for $986,700, according to an SEC filing.
    • The purchase was the latest by a director after Chairman/CEO John Flannery's $1.1M buy on Nov. 15 and board member Steve Mollenkopf’s 5,500-share purchase the following day.

    Good point by Deano, if you want more ABBV money, you can sell the 2020 $65 puts for $4.60 so you make way more than 0.80 if they stay up and none of that annoying selling calls and rolling.  

    How about MRK or GILD?

    • Bitcoin took its steepest dive in over a week, falling as much as 5.4% to $7,798, before paring declines to 0.5%, after a cryptocurrency peer renewed concern about the security of digital coins.
    • A "malicious" hacker removed $31M of tokens from the Tether Treasury wallet on Nov. 19 and sent them to an unauthorized bitcoin address.
    • Tether's development team is now trying to prevent the stolen coins from being used.

    Governing crisis in Germany

    • President Frank-Walter Steinmeier said Germany was facing its worst governing crisis in the history of its post-WWII democracy and pressed all parties in parliament "to serve our country" and try to form a government.
    • It comes after Angela Merkel said she would prefer fresh elections to ruling with a minority government after talks on forming a three-way coalition collapsed.
    Governing crisis in America:  Judge blocks Trump sanctuary cities order
    • U.S. District Court Judge William Orrick has blocked President Trump's executive order which would cut funding from sanctuary cities that limit cooperation with U.S. immigration authorities.
    • It will "cause constitutional injuries by violating the separation of powers doctrine and depriving [the counties] of their Tenth and Fifth Amendment rights," he wrote.
    • The Trump administration has appealed the decision.

    Lowe's beat estimates

    • Lowe's (NYSE:LOW) reports comparable-store sales rose 5.7% in Q3.
    • Comps for the U.S. home improvement business up 5.1% for the quarter.
    • Gross margin rate down 28 bps to 34.07%.
    • SG&A expense rate improved 323 bps to 22.71%.
    • Operating margin rate expanded 326 bps to 9.23%.
    • Merchandise inventory grew 12.8% to $12.39B.
    • Home improvement and hardware stores +25 Y/Y to 2,144.
    • FY2017 Guidance: Sales growth: ~+5%; Comparable-store sales: ~+3.5%; Operating margin: +80 to +100 bps; Tax rate: ~37%; Diluted EPS: $4.20 to $4.30; New stores: ~35.
    • LOW +0.91% premarket.

  48. I wish we had bought more UBNT!   That was Nabybob's call. Good example of a hit job on company with no basis in facts:

    Phil – Swap – UBNT – "Either Robert Pera is the best CEO in networking equipment, or Ubiquiti is committing FRAUD,” Left wrote.  Left also called into question what Ubiquiti describes as its “evangelical community” of users, who allow the company to reduce advertising and customer service costs. According to Left, these claims are exactly the type of “secret sauce” claims that are typical of corporate frauds. “While we do believe that at six or seven years ago Ubiquiti may have had an engaged WISP community, the story is now as implausible as the rest of the bull— UBNT tells Wall Street,

    Just like in Hong Kong, caught issuing fraudulent and misleading statements, I hope Left and Citron get banned from trading in the US for five years, are ordered to repay any trading profits and pay legal fees. 

    In the past I've mentioned UBNT on PSW here and here. I've deployed and utilized UBNT products, their sales are what they are, because of the product and support, best of class, nothing more, nothing less.

    "So where does UBNT sit in Cramer's eyes? He acknowledges not having done enough research to discredit or support Ubiquiti… In response to Left's claims, UBNT CEO Robert Pera had this to say, "I just put my head down and let the products and numbers speak for themselves. My apologies to those affected by these clowns."

    And that sums it up as propagandist Left makes money shorting companies, so why would anyone distrust his line of BS or motive for trashing the stock? DUH! As for Cramer,  a sycophantic ass clown, knowing not his musculus sphincter ani internus from a golf hole cup liner, and whom I would not allow to wash my car and Out.

    phil Submitted on 2017/09/19 at 5:48 am

    UBNT/Naybob – I haven't looked into the fraud issues.  If they are not cooking the books, they may be reasonable at $50.  Apparently Pera still owns 70% of the company – how pissed must he be that these guys just cost him $1Bn?  The good news is, if you are a believer, that the 2019 $50 puts are $11.90 for a net $38.10 entry, that's another 24% off from here.  You can pair it with the 2019 $40 ($16.50)/$55 ($9) bull call spread at $7.50 and you still have a $4.40 credit on the $15 spread with $19.40 (440%) upside.  I don't know enough facts to play it but that's how I'd play it if I thought this was unjust.

    That's how we make the big bucks in the market folks – learn to ignore the BS and find the facts!


  49. Speaking of China:

    In the past few years, scientists have identified marine ice-cliff instability as a feedback loop that could kickstart the disintegration of the entire West Antarctic ice sheet this century — much more quickly than previously thought.

    Minute-by-minute, huge skyscraper-sized shards of ice cliffs would crumble into the sea, as tall as the Statue of Liberty and as deep underwater as the height of the Empire State Building. The result: a global catastrophe the likes of which we’ve never seen.

    Ice comes in many forms, with different consequences when it melts. Floating ice, like the kind that covers the Arctic Ocean in wintertime and comprises ice shelves, doesn’t raise sea levels. (Think of a melting ice cube, which won’t cause a drink to spill over.)

    Land-based ice, on the other hand, is much more troublesome. When it falls into the ocean, it adds to the overall volume of liquid in the seas. Thus, sea-level rise.

    A wholesale collapse of Pine Island and Thwaites would set off a catastrophe. Giant icebergs would stream away from Antarctica like a parade of frozen soldiers. All over the world, high tides would creep higher, slowly burying every shoreline on the planet, flooding coastal cities and creating hundreds of millions of climate refugees.

    All this could play out in a mere 20 to 50 years — much too quickly for humanity to adapt.

    “Antarctic model raises prospect of unstoppable ice collapse,” read the headline in the scientific journal Nature, a publication not known for hyperbole.

     

    Three feet of sea-level rise would be bad, leading to more frequent flooding of U.S. cities such as New Orleans, Houston, New York, and Miami. Pacific Island nations, like the Marshall Islands, would lose most of their territory. Unfortunately, it now seems like three feet is possible only under the rosiest of scenarios.

    At six feet, though, around 12 million people in the United States would be displaced, and the world’s most vulnerable megacities, like Shanghai, Mumbai, and Ho Chi Minh City, could be wiped off the map.

    At 11 feet, land currently inhabited by hundreds of millions of people worldwide would wind up underwater. South Florida would be largely uninhabitable; floods on the scale of Hurricane Sandy would strike twice a month in New York and New Jersey, as the tug of the moon alone would be enough to send tidewaters into homes and buildings.

    Next to a meteor strike, rapid sea-level rise from collapsing ice cliffs is one of the quickest ways our world can remake itself. This is about as fast as climate change gets.

    There’s a recurring theme throughout these scientists’ findings in Antarctica: What we do now will determine how quickly Pine Island and Thwaites collapse. A fast transition away from fossil fuels in the next few decades could be enough to put off rapid sea-level rise for centuries. That’s a decision worth countless trillions of dollars and millions of lives.

    Image result for trump climate change