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Monday Market Mania – Explosion Rocks New York City

I was going to talk about BitCoin (/XBT in the Futures now), but screw that.

Something just blew up at the subway near the Port Authority in Times Sqare, in NYC (7:45) - this is supposedly a picture of it happening but not verified (Twitter).  The bomb squad is there and reports are someone has been taken into custody who looked like they had an explosive vest on but it's very fresh – we'll find out more as we go.  My initial reaction is to short the S&P (/ES) at 2,652.5 as it's toppy anyway so I don't mind holding the short.  Trains have now been stopped and evacuated.

This is where Futures trading is a very useful tool in our toolbelt – we're able to quickly react to news and protect our portfolio or, in this case, since we already cashed out, make a little money off the tragedy (sorry but it's true, we're like vultures!).  I was just in Times Square yesterday with my kids and their friends and we took the subway home last night – right through the Times Square Station.  

It's amazing how slow the indexes are to react to news like this.  The markets are so used to shrugging off news that it fails to react when things like this happen.  Meanwhile, we're not too different from our Friday call to short the indexes.  As I said in our Friday Morning Report:

What could possibly go wrong?  As you know, we are in CASH!!! but I'll short the S&P Futures (/ES) today at 2,650 and the Dow at 24,300 (/YM) and the Nasdaq at 6,380 (/NQ) and the Russell at 1,530 (/TF) because I think we're going to sell-off a bit into the close.  We generally use a 2 out of 4 rule for shorting and short the laggards as 2 of the indexes cross under and then, if ANY of them cross back over, we get out.  So that limits our losses while giving us a nice possibility for gains.

We cashed out a few on Friday but kept the /ES short into the weekend and now we're at 24,371 on /YM, 2,655 on /ES, 6,371 on /NQ and 1,525 on /TF so 2 of 4 are below and we can short the next cross below with confidence.  Does the market care of Manhattan subways are bombed?  Probably not in the long run but Wall Street traders are delayed this morning getting to work and, when they do get there – they won't be in a buying mood!  

Times square is the heart of NYC and, even from an economic perspective, we're going to lose part of a busy shopping day and bombs blowing up in the middle of town can put a bit of a damper on the season.  

Terrorism is one of many factors the market is simply ignoring as it plows on to record highs.  This dip may be very short-lived as it seems (8:15) it was a pipe-bomb (small) and only a couple of people were injured and the suspect is in custody so case closed, go to commercial, come back to wrap things up – I guess…

Deutsch Bank in fact, does not list Terrorism in it's Top 30 Risks to the Market in 2018.  Does that mean they don't think terrorism is a big deal or does it just mean all 30 of these things are worse?  The #1 risk, that US Inflation will move higher in Q2 of 2018 is not just specific but very likely to me.  ECB exiting QE we know is going to be bad, bond spreads WILL widen, that's a fact.  Still, it seems to me that TERRORISM should make a rational analyst's list – it just shows you how jaded investors have become to it.

We may see some of these dominoes begin to fall as the Fed is widely expected to raise rates on Wednesday (2pm) followed by Janet Yellen's final press conference at 2:30.  Friday is a Quadruple Witching Day when Stock Futures, Index Options, Stock Options and Single Stock Futures all expire on the same day so it's a REALLY good week for us to be watching from the sidelines.  Drahgi speaks on Tuesday and the Swiss National Bank, European Centran Bank and the Bank of England set rates on Thursday, so a very exciting week to take us into the holidays

 

Well it's 9am now and the Markets have fully recovered from a terrorist attack in NYC.  Perhaps Deutche Bank is right and it's not something we should worry about.  Also not really on DB's list, though #30 touches on it, is the possiblity that China's growth, not only will slow down – but never was that fast to begin with.  Once again we are finding that 10 more Chinese Provinces AND the city of Chongquing inflated fiscal revenues and borrowed money illegally to fund growth,  according to a National Audit.  This is a widespread issue in China and it remains to be seen what their real economy looks like.

OK. back to BitCoin now.  Futures trading started today (/XBT) and BitCoin flew up from $15,000 to $18,870 (20%) and is now back to $17,720.  We took the money and ran at $17,750 and we're certainly not missing our BitCoins because GreenCoin exploded 108% this morning and yes, the whole thing is silly but I'd rather gamble on my 0.00064 Greencoins than $17,720 BitCoins.  BitCoins are now too large to realistically make 100% gains – certainly not in a day!  

Another 100% on BitCoin would put it on par with Exxon (XOM) and Apple (AAPL) in market cap – that just seems silly, doesn't it?  Max Levchin, who co-founded PayPal told CNBC he's still not sure if BitCoin is brilliant or a scam.  He does, however, think the Blockchain Transaction, which underly BitCoin, GreenCoin and the other cryptocurrencies "will be essential and will not go away."

We'll see how BitCoin does on it's first day of trading futures.  What we're hoping with our GreenCoins is that this serves as an important step towards legitimizing cryptocurrencies in General. 

Have a good week,

- Phil

 


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  1. Adding new lines already. Really getting tired of winning!


  2. It's amazing the short sightendness of these idiots in Congress wanting to tax tuition waivers! They really hate science and smart people I guess:

    https://earther.com/the-house-gop-tax-bill-is-truly-horrifying-for-science-1820554703

    All of this adds up to a brain drain that would see U.S. talent never realized, or siphoned off to other countries. Labs would empty out, breakthroughs would be made abroad, and the U.S. standing as a leader in STEM education would go up in smoke. That’s hard to square with an administration that claims to be committed to slogans like America First. 


  3. These guys only believe in the 2nd amendment:

    http://talkingpointsmemo.com/livewire/moore-nixing-amendments-bill-rights-eliminate-problems

    In 2011, Moore appeared on a conspiracy-theorists’ radio show, and said if the U.S. got rid of all the amendments after the Bill of Rights, it would “eliminate many problems,” according to audio of the radio show, the “Aroostook Watchmen” show, obtained by CNN’s KFile.[...]

    In the interview, Moore specifically cited the 17th Amendment, which allows voters to directly elect senators instead of state legislatures, and the 14th Amendment, which granted citizenship to former slaves.[...]

    Other amendments post-Bill of Rights include the 13th Amendment, which abolished slavery, the 15th, which prohibited the government from blocking people’s right to vote based on race, the 19th, which gave women the right to vote and the 22nd, which limits the number of times a person can be elected to the presidency to two terms.


  4. Mandelbrot's ideas on investment made simple:

    https://25iq.com/2017/12/09/benoit-mandelbrots-ideas-about-investing-and-markets-made-as-simple-as-possible-but-not-simpler/

    Like this one:

    “Human nature yearns to see order and hierarchy in the world. It will invent it where it cannot find it.” “The brain highlights what it imagines as patterns; it disregards contradictory information. “So limited is our knowledge that we resort, not to science, but to shamans.”


  5. A lot of insider buys in CTL.

    ~~CTL Chairman, CEO, Vice Chairman, Directors, and President bought 188,500 shares at $14.17-14.41 worth ~$2.7 mln.


  6. Wow, up 6% plus


  7. First time over my buy price since I bought it. 

    Good call.


  8. Baron – And you've locked up a very high dividend, which I believe is secure based on cash flow from the LVLT side. 


  9.  

    https://www.wsj.com/articles/explosion-reported-at-new-yorks-port-authority-1512997695Suspect in Custody in New York’s Port Authority Explosion

    The suspect is a Bangladeshi man who was wearing an explosive device that was preliminarily identified as a pipe bomb, law-enforcement officials say


  10. Phil – 529 plans – I'm going to ground but just wanted your insight.  Based on junior's age (17 next month) my choices are limited to:

    A. 75% Bond/ 25% Stocks

    B. 75% Bonds/ 25% TBills

    C. 25% Bonds/ 75% TBills

    they don't give us much choice but fair enough.  If we take a hit the bonds should do ok so I lean to "B".


  11. St Jean//2nd amendment – yes "they" have twisted a reasonable concept (some not-infinite right to own a shotgun or two) into making waving guns around a substitute for waving their d*%n rebel flags around.


  12. SPWR making a nice move today bringing this position into the green! But it's like riding a roller coaster. I should remember to add when they are between $6 and $7 but it's not one of my most trusted picks!


  13. Good morning! 

    Sorry, something came up and I had to run out – all good now.

    Indexes up, all seems well.

    LOL StJ.

    7%/Pstas – That's practically dead.  I'd be surprised if it's a bullish year and we only go up 7%.  If there's no correction – I think we'll see some mad gains put up, at least 3,000 on /ES

    Tuition/StJ – This is an attack on our education system, plain and simple.  It puts us at a massive competitive disadvantage to other countries but, more importantly for Trump and his ilk, it puts our children a disadvantage to his children and grandchildren – who have money but not brains.  

    Mandelbrot – Interesting stuff.

    CTL/Albo – Congrats.

    529/Rexx – I went all money market but I guess bonds are good.  The intention is to get back in in Q2 so make sure you don't get a lot of friction costs.  

    SPWR – Wow, nice move finally.


  14. Copper blasting higher. 


  15. What the heck, there is now a FANG Index futures? That should not be volatile at all:

    https://www.thestreet.com/story/14320244/1/fang-stocks-index.html

    FANG is the acronym coined by TheStreet's own Jim Cramer that refers to stock market darlings Facebook Inc. (FB – Get Report) , Apple Inc. (AAPL – Get Report) , Amazon.com Inc. (AMZN – Get Report) , Netflix Inc. (NFLX – Get Report) and Alphabet Inc.'s (GOOGL – Get Report) Google. The index will also include Alibaba Group Holding Ltd. (BABA – Get Report) , Baidu Inc. (BIDU – Get Report) , Nvidia Corp. (NVDA – Get Report) , Tesla (TSLA – Get Report) and Twitter (TWTR – Get Report) .

    Already trading on TOS – /FNG


  16. it'll be interesting to see what happens to bitcoin's price on the third wednesday of every month


  17. No futures trading for Bitcoin on TOS yet….


  18. CSIQ proposing to go private at $18.47/sh. Short 2020 strangles might be a good play as they'd expire worthless soon.


  19. Not going to help:

    https://arstechnica.com/tech-policy/2017/12/bitcoin-fees-are-skyrocketing/

    The cost to complete a Bitcoin transaction has skyrocketed in recent days. A week ago, it cost around $6, on average, to get a transaction accepted by the Bitcoin network. The average fee soared to $26 on Friday, and was still almost $20 on Sunday.


  20. and why is that StJ? I don't understand


  21. Thanks jelu… CSIQ board will meet to review the offer… wonder, why the CEO wants to take it private? LT, a bigger value?  This should hopefully set a floor for the price for the near term. I have a $10 put sale that should expire worthless.  


  22. Transaction fees are too high it seems.


  23. I don't understand why that is "not going to help", as you suggested in your comment? Not going to help what?


  24. And the bid/ask spread on Coinbase is over 2%, almost $500 per Bitcoin.


  25. JO is getting stomped on, despite my drinking it as fast as I can.


  26. CSIQ/Learner, I'm sorry to see this one go, I've  done well with it this year.


  27. Phil/JO

    We have (or at least I do) June 15/18 BCS with 18 puts, but it looks like 2019 and 2020 (can you cleive)are out.  Any thoughts yet or wait until some sort of seasonality kicks back in?


  28. Oh, and the VIX is going to 0.


  29. friction/529   They've been automatically rolling from one 'age-appropriate' fund to the next all along.  No choice.  So in spring they rolled it from 37.5% stock/ 62.5 bonds to the current 25% stock/ 75 bonds.  I bet they charged two commissions on 100% even though they were really only switching 12.5% of junior's assets.  And they didn't net even if they had an offset that day.


  30. CSIQ/ me too Jelu,  but given this toppy market, I am happy to take profits and get on the sidelines.  


  31. now litecoin is 186! 


  32. NG can't get going, anybody got a match? Makes no sense to me, what do you see Phil?


  33. BDC – Not going to help acceptance of bitcoins for transactions. I guess right now it's just a speculation instrument which is OK but the goal was to eventually work like currencies for day to day transactions. That seems to be hard to imagine now.


  34. FANG/StJ – They are coming up with more and more ways to get people to gamble. 

    ToS/StJ – I see /XBT – haven't tried to buy one.  It's simply buying or selling a BitCoin, not sure where they're getting the price though – exchanges tend to differ.   $25/tick!  

    CSIQ/Jet – That's an interesting way to play.  Too bad, I like those guys.

    JO/Baron – Yes, I have a lot of /KC now too.  Hopefully it's just the normal Monday bottom, but that's what I hoped on the 5th!  

    30th, 6th, 13th, 20th, 27th, 4th were the other Mondays.

    Our premise on Coffee is that Global Warming will, at some point, impact crop production.  Hasn't been a big impact yet so it's just a matter of going longer and longer.  The June $15 calls are $1.30 and the $18 puts are $3.10 so I'd roll out to the 2020 $14 ($3.50)/$18 ($1.85) bull call spread at $1.65 and roll the short puts to 1.3x the 2020 $16 puts $2.50 and those will be hard to fill but no NEED to do anything unless you get your price as the only reason you wouldn't get it is if JO is going higher.

    VIX/Baron – Been going there for a long time:

    529/Rexx – Just another way to steal people's money.  I liked the tax-free aspect of it as well as the discipline of having the specific accounts but, in 15 years, they only made 150% – could have done a lot better playing the money and paying the taxes.  

    Litecoin/BDC – If Futures don't crap out BTC, then they all get legitimized.  

    /NG/Mkucs – Well it's up a little, just not much.  Winter is coming so I have faith.  

    Image result for winter is coming animated gif

    Won't last long though:

    Perfect timing for my Vegas trip!  


  35. Another one bites the dust:

    Mario Batali is giving up oversight of the daily operations at his restaurant empire following reports of sexual misconduct by the celebrity chef over a period of at least 20 years.

    Trump still POTUS though!


  36. AAPL buying Shazam.

    graph of U.S. liquefied natural gas exports and export capacity, as explained in the article text

    In August 2017, total U.S. natural gas liquefaction capacity in the Lower 48 states increased to 2.8 billion cubic feet per day (Bcf/d) following the completion of the fourth liquefaction unit at the Sabine Pass liquefied natural gas (LNG) terminal in Louisiana. With increasing liquefaction capacity and utilization, U.S. LNG exports averaged 1.9 Bcf/d, and capacity utilization averaged 80% this year, based on data through November.

    Sabine Pass, located on the U.S. Gulf Coast near the Louisiana-Texas border, consists of four existing natural gas liquefaction units, or trains, with a fifth train currently under construction. When complete, Sabine Pass will have a total liquefaction capacity of 3.5 Bcf/d. Five additional LNG projects are currently under construction in the United States, and they are expected to increase total U.S. liquefaction capacity to 9.6 Bcf/d by the end of 2019:

    • Cove Point liquefaction terminal (one train, 0.75 Bcf/d capacity) in Maryland is 97% complete, and Dominion Energy expects to place it in service before the end of 2017.
    • Elba Island LNG (10 modular liquefaction trains, 0.03 Bcf/d capacity each) in Georgia is owned by Kinder Morgan. Six trains are scheduled to come online in the summer of 2018, and four trains are scheduled to come online by May 2019.
    • Freeport LNG (three trains, 0.7 Bcf/d capacity each) in Texas is being developed by Freeport LNG Development, L.P. The first train is expected to come online in November 2018, with the remaining two trains following in six-month intervals.
    • Corpus Christi (two trains, 0.6 Bcf/d capacity each) in Texas is being developed by Cheniere and is expected to come online in 2019.
    • Cameron LNG (three trains, 0.6 Bcf/d capacity each) in Louisiana is being developed by Sempra LNG and is expected to come online in 2019.

    graph of U.S. liquefied natural gas export capacity, as explained in the article text

    So the big action in /NG comes late next year into 2019.

    Trump/StJ – Well stuff is happening on that front.

     A group of women who have publicly accused President Donald Trump of sexual harassment and assault detailed their accounts of being groped, fondled and forcibly kissed by the businessman-turned-politician at a news conference on Monday.

    The White House's official position is that all 13 of these women are lying.

    At least 13 women have come forward with accusations against Trump ranging from sexual harassment and misconduct to sexual assault, including unwanted kissing and groping. All the alleged incidents took place prior to his assuming the presidency.
    In addition to the woman at the press conference on Monday, the accusers include Temple Taggart, the former Miss Utah USA who accused Trump of kissing her on the lips in 1997; Mindy McGillivray, who accused Trump of grabbing her butt at his Mar-a-Lago club in Florida in 2003 and Natasha Stoynoff, who accused Trump of "forcing his tongue" down her throat during a photo shoot at Mar-a-Lago in 2005.


  37. Phil – Bitcoin which is it?  "Max Levchin, who co-founded PayPal told CNBC he's still not sure if BitCoin is brilliant or a scam. "

    It is both.


  38. Phil – Bitcoin is unregulated so these futures are a shady-trader's (e.g., all of Was Street) dream come true. GS hasn't lost in what, like 4000 consecutive days right? I think they'll manipulate the living F*** out of BTC on expiration day. I wouldn't want to touch this stuff with a 50-foot pole. Just my 2 cents (I mean, 60 green coins)…  


  39. this chart (1 hour – zoom out a little) is long-term bearish if the price doesn't tick up past 18,000 and hold it very soon. 60 coins and out.


  40. Phil/Vegas – when are you going?


  41. I sold ''all' my BTC on Sat evening at $13600. Made 100%. the 100% is ETH, LTC and GRE.


  42. /KC — this burned me bad when it went to 116 a while back this year…and then V rocketed back.


  43. if anyone has 'enjoyed' the task of transferring, wiring monies between institutions, which I have lately, you readily understand how block chain technology will revolutionize the financial process.  Lots of admin jobs on the hook for this.


  44. Latchdaddy 

     

    HERE !  HERE !


  45. Phil or other members — How to buy green coin, which broker is purchase from Thanks ahead 


  46. LOL BDC.  Not only that but it's 40% margin!  $17,920 now.   I'll be in Vegas Christmas day for the week.

    Wow, BitCoin is all the Financial N

    GreenCoin/Gucci – BDC wrote a nice article here you can follow on using CoinExchange.  You have to buy a BitCoin first and then use that to buy GreenCoin but you don't need to buy whole BitCoins, you can buy parts of them.  Here's the exchange for GreenCoins, bid low, not high!

    USD Price $0.00075568

    Nice, up and up today!  


  47. Phil// Question on buying the HBI trade of the year recommendation – As we have cashed out all of the portfolios and maintaining a bear stance, would be appropriate to wait to initiate the trade on HBI?  Also you recommendations on GE – as the company has sold off few of their divisions, won't that affect the top line revenue and thereby the bottom line.  Where do you see GE as price point in two years with so much re-org and some uncertainty surrounding GE.  Thanks.









  48. 25 cities adding (and losing) the most jobs in 2017










  49. Funny, the GOP tax bill violates multiple international treaties we have signed:

    http://www.motherjones.com/kevin-drum/2017/12/europe-doesnt-like-the-republican-tax-bill/

    How do we reconcile that?


  50. Comment content omitted because it is too long.


  51. HBI/Rookie -   Well, if you were never in it, no harm in waiting.  I still like the trade – it has a long way to go but we'll be picking a new entry from scratch in Jan, when we begin re-deploying out capital.  

    It's up 10% from our entry and hopefully will pull back a bit before racing up to $22.

    • Subscription notice: You can automatically receive Stocks to Watch every week by following the SA Stocks to Watch account and setting email alerts on.
    • Key events are scheduled for the companies listed below next week.
    • Expected IPO filings: Adial Pharmaceutical (Pending:ADIL), Casa Systems (Pending:CASA) and Burger King Brasil on Dec. 14; Newmark Group (Pending:NMRK) on Dec. 15.
    • Star Wars: The timing for Disney's (NYSE:DISThe Last Jedi opening on Dec. 15 is promising amid the consumer spending bounce and with the MoviePass (NASDAQ:HMNY) model generating interest with millennials. Numbers to watch include the early box office forecast for a +$200M opening weekend and the $248M mark delivered by The Force Awakens in 2015. Theater chains AMC Entertainment (NYSE:AMC), Cinemark (NYSE:CNK), Regal Entertainment (NYSE:RGC), Marcus Corporation (NYSE:MCS) and IMAX (NYSE:IMAX) hope for a strong buzz factor into the weekend, while Hasbro (NASDAQ:HAS) eyes a Star Wars toys boom.
    • Bitcoin watch: Looking for Bitcoin exposure without having to deal with tokens, mining and eye-popping volatility? Fundstrat says potential Bitcoin/Blockchain equity plays include Bitcoin Investment Trust (OTCQX:GBTC), MGT Capital Investments (OTCQB:MGTI), HIVE Blockchain Technologies (OTCPK:PRELF), U.S. Global Investors (NASDAQ:GROW), DigitalX (OTC:DGGXF), Nvidia (NASDAQ:NVDA), AMD (NASDAQ:AMD), CME Group (NASDAQ:CME), CBOE Holdings (NASDAQ:CBOE), Overstock.com (NASDAQ:OSTK), Goldman Sachs (NYSE:GS) and Square (NYSE:SQ).
    • Notable earnings reports: Salesforce.com on Dec. 11; Casey's General Stores (NASDAQ:CASY), VeriFone (NYSE:PAY) on Dec. 12; ABM Industries (NYSE:ABM) and Nordson (NASDAQ:NDSN) on Dec. 13; Costco (NASDAQ:COST), Oracle (NYSE:ORCL), Jabil (NYSE:JBL) and Adobe (NASDAQ:ADBE) on Dec. 14. See Seeking Alpha's Earnings Calendar for more.
    • Quiet period expirations: Retail upstart Stitch Fix (NASDAQ:SFIX) is up over 50% from where its IPO into its quiet period expiration on Dec. 12. Other names to watch include SendGrid (NYSE:SEND) and Arsanis (Pending:ASNS) on Dec. 11, along with Bluegreen Vacations (Pending:BXG), SailPoint Technologies (NYSE:SAIL) and Level Brands (NYSEMKT:LEVB) on Dec. 12.
    • IPO/secondary share lockup period expirations: Athenex (NASDAQ:ATNX) and Micron Technology (NASDAQ:MU) on Dec. 11; Portola Pharmaceuticals (NASDAQ:PTLA) and Adomani (NASDAQ:ADOM) on Dec. 12; Boston Omaha (OTCQX:BOMN), Interspace Diagnostics (NASDAQ:IDXG), Curis (NASDAQ:CRIS) and Workhorse (NASDAQ:WKHS) on Dec. 13; Acushnet (NASDAQ:GOLF) on Dec. 14; Genpact (NYSE:G) on Dec. 15.
    • Annual meetings: The headliner of the week is Deckers Outdoor (NASDAQ:DECK) on Dec. 14 amid the heated proxy fight between the retailer and Marcato Capital. Cisco (NASDAQ:CSCO) and 1-800-Flowers.com (NASDAQ:FLWS) on Dec. 11, as well as United Natural Foods (NASDAQ:UNFI) on Dec. 13 are also on the calendar.
    • Analyst/investor meetings: Arthur J. Gallagher (NYSE:AJG) on Dec. 12; TE Connectivity (NYSE:TEL), Lending Tree (NASDAQ:TREE) and Jones Lang Lasalle (NYSE:JLL) on Dec. 13.
    • Business update/Guidance calls: American Water Works (NYSE:AWK), Glencore (OTCPK:GLCNFOTCPK:GLNCY) and Principal Financial (NYSE:PFG) on Dec. 12; Charles Schwab (NYSE:SCHW) on Dec. 13; Axalta Coating Systems (NYSE:AXTA) and Prudential (NYSE:PRU) on Dec. 14; MetLife (NYSE:MET) on Dec. 15.
    • M&A watch: Deals are heating up in a number of sectors. The deadline for bids on Unilever's (UNUL) spreads business is Monday, while an Apollo Global acquisition of Qdoba (NASDAQ:JACK) is said to be imminent. Disney (DIS) and Twenty-First Century Fox (FOXFOXA) are a step closer to striking an asset deal which could include Hulu.
    • FCC watch: The commission will vote on repealing current net neutrality rules during a scheduled meeting. The usual media suspects such as Netflix (NASDAQ:NFLX), Sprint (NYSE:S), AT&T (NYSE:T), Dish Network (NASDAQ:DISH) and Comcast (NASDAQ:CMCSA) are likely to weigh in on the consequences of the vote.
    • Credit card delinquency reports: American Express (NYSE:AXP), Bank of America (NYSE:BAC), Citigroup (NYSE:C), Capital One (NYSE:COF), Discover Financial (NYSE:DFS), JPMorgan (NYSE:JPM) and Synchrony Financial (NYSE:SYF) are all due to post credit card chargeoff data on Dec. 15.
    • Cowen Networking & Cybersecurity Summit: Presenters at the gathering from Dec. 12-13 include execs from Arista Networks (NYSE:ANET), MACOM Technology (NASDAQ:MTSI), NeoPhotonics (NYSE:NPTN), Check Point Software (NASDAQ:CHKP), Cisco (CSCO) and Quatenna Communications (NASDAQ:QTNA).
    • Barron's mentions: The publication cuts right to the chase to name its top picks for 2018. Alphabet (GOOGGOOGL), Delta Air Lines (NYSE:DAL), Berkshire Hathaway (BRK.ABRK.B), Volkswagen (OTCPK:VLKAY), Pioneer Natural Resources (NYSE:PXD), Applied Materials (NASDAQ:AMAT), Enterprise Products Partners (NYSE:EPD), Ally Financial (NYSE:ALLY), Anthem (NYSE:ANTM) and US Foods Holding (NYSE:USFD) all make the list. There's a less optimistic view on the off-price retail sector expressed, with Ross Stores (NASDAQ:ROST) and TJX Companies (NYSE:TJX) seen at risk for share price falls.
    • Sources: EDGAR, Bloomberg, Nasdaq.com, CNBC.
    • Goldman Sachs equity research analysts publish a slew of sector-by-sector outlooks for 2018:
    • Aerospace/Defense: Bullish on defense, more selective in commercial aerospace – top picks NOCLLLFLIRHRSLDOSTDG.
    • Agriculture: Neutral overall but potential upside in nitrogen, value-added protein and biofuels – top picks CFUANDARGPRETSN.
    • Autos: Cautious as North America auto cycle likely continues "to cool off, on its way to a normalized SAAR by 2020" – potential strength in secular growth exposed names APTVDLPHVC.
    • Chemicals: Three interesting value names, including two with near-term catalysts in sight (DWDPPAH) and one that does yet not fully reflect an underlying mix shift in earnings (NYSE:EMN).
    • Construction: Prefers building products on more dynamism driven by continued input inflation, rising rates, peak PMI and an evolving legislative environment - MHK is top pick.
    • Machinery: Group is a buy as share of industrial capex is 20% below normalized levels, used equipment inventories are lean, Street estimates are still beatable – top picks CATDEAGCOTRMB.
    • Medical Technology: Attractive view on med tech, neutral on life science tools – adds HOLX to conviction list; other top picks BAXEWISRG.
    • Multi-Industry: Optimistic as bottom-up capex remains positive while tax reform could spur investment, though high quality cyclicals preferred - IR upgraded to Buy.
    • Packaging, Paper & Forest Products: WRK is top pick given exposure to e-commerce growth and self-help opportunities.
    • Transports: Sees divergence between airfreight/logistics (attractive) and rails (cautious) due to continued strength in consumer/logistics business lines, deceleration in industrial/commodity business lines – recommends FDXUPSXPOCNI.
    • Source: Bloomberg First Word
    • General Electric (NYSE:GE) shares are reiterated with a Neutral rating at Goldman Sachs, which says it is staying on the sidelines despite the recent selloff until it sees more evidence that a turnaround – proof of a recovery in cash flows and end markets – is working.
    • Analyst Joe Ritchie says 2018 will be a transitional year for GE, with investors focused on whether or not the company can meet its targets: "On cost-outs, GE is targeting $3B-plus of actions in 2017-18 to generate $2B-plus of net benefits, and we believe it will be critical for GE to demonstrate core margin expansion."
    • Progress in GE Power also is a key area of debate, and the "ability to offset end market weakness with cost-outs and show 60% free cash flow conversion in 2018 (vs. negative in 2017) will be a key measure in increasing confidence [and] believability that fundamentals can turn around by 2019-20," Ritchie writes.
    • The same analyst who presciently slapped a Sell rating on GE also is bearish on 3M(NYSE:MMM), reiterating his Underweight rating on the view that 3M's valuation reflects too much optimism about its fundamentals.
    • J.P. Morgan's Stephen Tusa thinks the market is mistaking some cyclical improvement for visible, execution-driven growth that 3M can control, when these factors actually are out of its hands.
    • "Similar to lower multiple/lower quality stories, 3M has enough noise in the numbers (gains representing 5%-10% of earnings, dramatic stock comp payments) to call it the beginning of a trend line on margins [but] 3M this cycle has had a 'perfect storm' for relative outperformance as lack of oil/gas exposure has boosted relative organic while providing significant raw materials benefits, an element that is cyclical," Tusa writes.
    • The analyst concludes that 3M is a staple-like asset but he does "not see enough growth and/or free cash flow to put into the compounder category where it currently stands."


    • Blastoff! President Trump will sign a directive today aimed at sending Americans back to the moon and eventually to Mars.
    • "He will change our nation's human spaceflight policy to help America become the driving force for the space industry, gain new knowledge from the cosmos, and spur incredible technology," according to a White House statement.
    • The event will coincide with the 45th anniversary of the last crewed mission – Apollo 17 – to land on the moon.

    CA wildfire: Containment falls back to 10%

    • Southern California's largest wildfire continued to grow Sunday, threatening seaside communities in Santa Barbara County and prompting new evacuation orders.
    • As a result, officials revised containment downward, from 15% to only 10%.
    • The wildfires wiped out almost $3B of market value for Edison International last week and threatened operations of companies like Snap Inc. and California Resources.
    • Previously: California wildfire now 15% contained (Dec. 09 2017)
    • CBOE's plan to launch bitcoin futures contracts on Sunday, making it easier to bet against the cryptocurrency, is making some enthusiasts nervous, but not Cameron Winklevoss – one half of the twins reported to have just become the world's first bitcoin billionaires.
    • "We've always felt that bitcoin, given its properties, is gold 2.0 – it disrupts gold. Gold is scarce, bitcoin is actually fixed. Bitcoin is way more portable and way more divisible," he told CNBC. "Long term, directionally, it is a multitrillion-dollar asset – I don't know how long it takes to get there."
    • The Winklevosses' Gemini exchange is even preparing to support the launch of CBOE's bitcoin futures and will be the "price mechanism for the contracts when they settle."
    • Current price movement: Bitcoin is down 11% to $14,261, according to CoinDesk.

    Forties oil pipeline to close for repairs, sending Brent crude higher

    • Brent crude oil (NYSEARCA:BNO+1.7% to $64.45/bbl on news that the 450K bbl/day North Sea Forties pipeline likely will be shut for weeks to carry out repairs to an onshore section of the line.
    • A crack and leak was discovered last week, which operator Ineos says worsened over the weekend despite pressure being reduced.
    • The Forties pipeline carries ~40% of North Sea oil and gas and serves Ineos’s refinery at Grangemouth, which provides ~80% of Scotland’s fuel, so the shutdown could have implications for North Sea supplies as operators may be forced to reduce production until the line is restored.
    • U.S. WTI crude +0.5% at $57.67/bbl.
    • Two high ranking Trump administration officials called two U.S. senators from the corn belt to convince them to join talks about potential changes to biofuels policy to ease the burden on oil refineries, Reuters reports.
    • The effort is the latest sign that Pres. Trump is seeking to mediate the long-running dispute between the oil industry and corn growers over the Renewable Fuel Standard, after meeting yesterday with nine Republican senators from states with oil refineries.
    • Refiners oppose the RFS because they say it costs them hundreds of millions of dollars a year in blending and regulatory expenses, but the administration has sided with Big Corn and against the refining industry in a series of decisions this year.

    • Canadian Solar (NASDAQ:CSIQ+5% premarket after announcing it received a letter from CEO and top shareholder Shawn Qu to take the company private.
    • Qu and his wife are offering to buy all outstanding shares they do not already own for $18.47/share, representing a 7.1% premium to CSIQ's Friday closing price; the pair owns ~23.5% of the shares.
    • CSIQ says its board has formed a special committee to consider the proposal.
    • First Solar (NASDAQ:FSLR+2.5% premarket after Baird upgrades shares to Outperform from Neutral with a Street-high $82 price target, raised from $69, with the firm calling it the top pick within the solar sector.
    • Analyst Ben Kallo note says Baird recently met with FSLR’s management and sees the company as well positioned for growth; Series 6 has some execution risk, but Baird sees shares appreciating near-term.
    • Baird also boosts SunPower (NASDAQ:SPWR) to Outperform from Neutral with a $10 price target, hiked from $7, saying sentiment should improve as SPWR ramps P series production and strengthens its balance sheet; shares +5.5% premarket.
    • The firm thinks potential headwinds from the Suniva petition mostly are priced in, and shares could benefit if no tariff is enacted or SPWR receives an exemption.
    • Baird believes the solar market has hit an inflection point that will continue to see long-term growth driven by falling installation costs and technological advancement.
    • ETFs: TANKWT

    • Airbus (OTCPK:EADSY) is exploring plans to lower A380 superjumbo production to as low as six aircraft per year, industry sources told Reuters.
    • The planemaker already announced plans to lower A380 output to 12 aircraft in 2018 and 8 in 2019, down from an annual peak of 30.
    • International sales of arms and military services grew again in 2016 after five years of consecutive decline, according to the Stockholm International Peace Research Institute.
    • The world's 100 largest armaments firms posted total sales of $374.8B last year, 1.9% higher than in 2015.
    • SIPRI also said that the world's largest arms producer, Lockheed Martin (NYSE:LMT), rose by 10.7% in 2016, and this was "decisive to the increase in the USA's share of overall SIPRI top 100 sales to 57.9%."
    • Monsanto (NYSE:MON) will give cash back to U.S. farmers who buy a weedkiller that has been linked to widespread crop damage, Reuters reports, as regulators in some states weigh restrictions on its use.
    • MON's incentive to use XtendiMax with VaporGrip, a herbicide based on the dicamba chemical, could refund farmers more than half the sticker price of the product in 2018 if they spray it on soybeans the company engineered to resist the weedkiller, according to the report, which cites company data.
    • MON’s offer comes as federal and state regulators are requiring training for farmers who plan to spray dicamba in 2018 and limiting when it can be used; the restrictions could make the chemical more costly and inconvenient to apply, but the company’s incentive could help convince farmers to use it anyway.

    Bernstein sees +20% growth in Macau for Dec.

    • Bernstein thinks Macau gaming revenue will increase 21% to 23% during December based on the pace through the first ten days and estimates on the balance of the month.
    • The investment firm points to two strong weekends in December for Macau traffic already.
    • Gaming stocks had a strong day in Hong Kong after Credit Suisse bumped up its revenue forecast for the next three years.
    • Macau casino stocks: Wynn Macau (OTCPK:WYNMFOTCPK:WYNMYWYNN), Sands China (OTCPK:SCHYYOTCPK:SCHYFLVS), MGM China (OTCPK:MCHVFOTCPK:MCHVYMGM), Galaxy Entertainment (OTCPK:GXYEF), SJM Holdings (OTCPK:SJMHFOTCPK:SJMHY), Melco Resorts & Entertainment (NASDAQ:MLCO).
    • Related ETF: BJK.

    Restaurant stocks perky, led by moonshot for Famous Dave's

    • There's some buying action in the restaurant sector as M&A potential and strong consumer spending continue to boost sentiment.
    • Notable gainers include Biglari Holdings (BH +5.5%), Zoe's Kitchen (ZOES +2.3%), Sonic (SONC +2.7%), Fiesta Restaurant Group (FRGI +2%) and Brinker International (EAT +2.5%).
    • None of those rallies can hold a candle to the 32% pop in Famous Dave's of America (NASDAQ:DAVE) on a huge volume spike. Shares of the barbecue chain traded as high as $9.65 before settling back to $7.25 after a trading halt.

    Skechers called out by Cowen as top idea

    • Skechers (SKX +1%) is called a top idea for 2018 by Cowen & Co.
    • "The breadth and depth of the Skechers assortment and the brand's global reach, category expansion opportunities and consumer perception is underappreciated (based on relative valuation to peers)," writes analyst John Kernan.
    • Kernan and team see Skechers generating global same-store sales growth of 3% in 2018.
    • Skechers is rated at Outperform and assigned a price target of $42.

    Twitter engagement up with long tweets; new Bloomberg streaming news coming

    • Twitter (TWTR +4.7%) is seeing deeper engagement since its much-publicized move to longer tweets, a BuzzFeed look at data shows.
    • Retweets and likes of tweets are happening at about double the rate from before tweets were extended to 280 characters from 140, BuzzFeed says based on data from SocialFlow.
    • During an experimental pilot period, people who had the additional room got more followers and spent more time on Twitter, the company says.
    • Meanwhile in Twitter-as-a-live-platform news, Bloomberg is launching "TicToc," a 24-hour news network that will be streaming live on the service. It's set to launch next Monday.

    Microsoft launches quantum programming language, commits $50M to AI drive

    • Microsoft (NASDAQ:MSFT) launches Q#, a programming language for quantum computers, and software that allows developers to test programs on a traditional desktop or the Azure cloud platform.
    • Microsoft hasn’t produced a working quantum computer yet. Competitors Google and IBM have built computers close to “quantum supremacy.” IBM also has software for its machines.
    • In other Microsoft news, the company commits $50M over five years for the use of AI in solving environmental issues through the AI for Earth initiative.
    • Previously: CNBC: Microsoft and Google spoke to Qualcomm against Broadcom offer (Dec. 8)

    Disney's 'Coco' outpunches 'Justice League' for third week

    • Coco (DIS +2%) held a solid lead at the box office for the third week in a row, topping Justice League (NYSE:TWX) yet again and crossing over the $135M mark in domestic grosses.
    • The week had no notable newcomers, other than the wide release of A24's The Disaster Artist,which rode a healthy per-theater gross to $6.4M and the No. 4 spot, behind Wonder (LGF.A-0.5%LGF.B -0.5%) with $8.45M.
    • Justice League's $9.6M added to weekday totals to bring that film over $200M domestically — a total of $212.1M, adding to a worldwide gross total of $613.4M.
    • Coco, meanwhile, has touched $389.5M on a worldwide basis, and has drawn within $18M of surpassing this summer's Pixar-mate Cars 3 in domestic totals.

     

    WSJ: A Fox-Disney deal would mean scaled-back film slate

    • A megadeal to bring the TV and film assets of Twenty-First Century Fox (FOX -0.2%FOXA+0.3%) under the auspices of Walt Disney (DIS +1.7%) would not just reduce the Big Six Hollywood studios to five, but would mean a significant scaling back of Fox's slate as well, The Wall Street Journal reports.
    • The reduced ambitions would be folded into Disney's existing film operations rather than kept separate or expanded, according to the report.
    • Fox could become another production label akin to Pixar or Marvel, which would result in job cuts as theatrical and home video distribution are trimmed.
    • It would also mean output from Fox, known for releasing far more films than Disney, would fall in line with Disney output: fewer films, focused on big-budget releases based on existing properties.
    • While the era of the "Big Six" would come to an end, Fox's TV studio would be kept busy building content for the upcoming Disney streaming services as well as for other outlets.
    • In other news tied to a potential deal, United First Partners says in a weekend note that a purchase of the rest of Sky (SKYAY +0.7%) by either Disney or Comcast (CMCSA +0.9%) would be more palatable to UK regulators than Fox's current proposal to buy out the rest.
    • Those two don't have Fox's "baggage," UFP says, so a consummated deal for Fox assets would mean gains for Sky stock.
    • CenturyLink (CTL +8.1%) has been selected as the network provider to Pennsylvania, a deal that will have it supplying a full suite of products and services to the Commonwealth.
    • The company will collaborate with Comcast Business (CMCSA +0.6%) on the five-year deal, which covers a range of deliverables: microwave and fixed satellite data access, Ethernet, private line, managed network services, virtual private networks, high speed cellular, bandwidth on demand and others.
    • The deal in particular looks to address last-mile solutions (fiber, coaxial and wireless) to the agencies, commissions, councils, bureaus, authorities and boards of Pennsylvania.
    • CenturyLink operates more than 7,700 route-miles of fiber in the state, with more than 2,200 on-net buildings.

  52. Treaties/StJ – Well, apparently Trump doesn't feel he has to abide by any promises made by previous Administrations.  All this will do is make it impossible for Future Presidents to have their proposals taken seriously when the other Governments feel the positions can be reversed in 4 years or less.

    Big Stick into the close – especially /ES to 2,663.50

    /YM 24,405


  53. Treaties / Phil – How long will it take to change once other countries start adding tariffs to our export as part of these treaties and US businesses make some calls to Congress?


  54. If the opposite of pro is con, what is the opposite of progress?

    and do they follow the constitution? Or…..




  55. Phil, Do you foresee a rate hike this week driving down metals? 



  56. I have been researching Options and Taxes.  It appears there are a couple of different directions one can go with this. One option is to report everything as investment income with long-term/short-term capital gains/losses. This method will NOT allow for deductions of expenses you might incur (ie research materials, PSW membership, home office, etc.) and on all short term gains the income tax will be at your ordinary rate while long term gains will be at capital gains rates (15%), if it remains there.

    The second option is to treat this as a business where all your income is regarded as ordinary income subject to self-employment tax but you can now deduct any ordinary or necessary expenses you have to generate this income.

    Does that pretty much sum it up? 

    Oh, I suppose, depending on the amount of expenses one might have, the self employment tax can be offset enough where you end up paying less overall tax using option 2. 







  57. TEVA working with Evercore on debt options (extending terms etc).  This could be classified as a distressed exchange and cause them to lose the IG rating.  Lenders said to understand turnaround will be a 2-3 year process.