Archive for the ‘Appears on main page’ Category

Fed Day Follies – Dollar Crashes in Anticipation of MORE FREE MONEY!!!

Is America great yet?

It is if you get paid in something other than Dollars, or if your assets are not Dollar-backed.  Otherwise, it's 3.4% less great than it was in November – as measured by Global confidence in our currency.  Cutting taxes, running up Government spending, threatening war (s) and easy money policies are no way to strengthen a currency.

US Household Wealth is roughly $100Tn so a 3.4% cut in the value of those Dollars means $3.4Tn was essentially taken from us – pretty much confiscated by our Government.   That's a lot worse than any tax because it's 3.4% of EVERYTHING we have.  Fortunately for those of us in the Top 1%, a lot of that $3.4Tn went right back into the market, where we have the bulk of our wealth anyway and, of course, we have enough money that we diversify our assets into other currencies and, of course, Gold, which has flown up from $1,125 to $1,325 (17%) since the election.

So thank you, Bottom 99%, for your contributions to our portfolios.  We couldn't have done it without devaluing everything you own!  In yesterday's morning Report, we discussed the massive debt bomb we are facing and looked at the Fed's projections and concluded the market may be wrong and the Fed may tighten at this meeting.  If they do, the Dollar will shoot higher and shorts will cover so I like Dollar Futures (/DX) long over the 91.50 line – with tight stops below.  

If the Fed surprises us and brings rates up 0.25%, expect the /DX to move up to at least 92.5 for $1,000 gains per contract.  Don't forget, Japan, Europe and China do not want a weak Dollar – this is the point they are likely to step in and prop it up anyway – so I feel pretty good about that play.  If you are Futures-impaired, you can use the Dollar ETF (UUP) as a proxy.  It's at 23.80 and the October $23.50 calls are just 0.45 so 0.15 in premium isn't bad for a month's worth of leverage, right? 

We'll look at that trade this afternoon at
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The Future Of Artificial Intelligence (According To Pop Culture)

Courtesy of Zero Hedge

The unpredictable nature of super-intelligent, self-improving machines lends itself quite nicely to the dramatic storylines of movies and books.

It’s a science fiction writer’s dream – as Visual Capitalist's Jeff Desjardins warns: if AI becomes smart enough to create more advanced versions of itself, pretty much every outcome is on the table. Machines could empower humanity to become enlightened and virtuous. On the less optimistic side? Machines could instead ruthlessly enslave all of humankind to tickle their own warped sense of satisfaction.

POP CULTURE PERSPECTIVES

From the plot of movies like The Terminator to The Matrix, pop culture offers up innumerable examples of what could happen from the rise of the machines – and most of them, as you can imagine, steer towards the less optimistic side of the spectrum.

Today’s infographic from BBC Future provides an entertaining take on these scenarios, organized by potential likelihood.

Courtesy of: Visual Capitalist

Some experts see AI having a $15.7 trillion impact on our economy, but pop culture offers up a slightly different perspective of what the future may hold.

FUTURE AI SCENARIOS

Here are just some of the scenarios offered up in mainstream movies, books, and television shows. Some are apocalyptic and dystopian, and some seem just plain bizarre:

Seductive Siris: In 2013’s Her, Joaquin Phoenix falls in love with an intelligent operating system named Samantha.

Self-Replicating AI: In 1995’s Screamers, scientists create a self-replicating weapon with one purpose: to destroy all life.

The Singularity: AI vies to take over the world in 1982’s classic Tron.

Rampaging Robots: In 1973’s Westworld, recently re-envisioned as a different TV series by HBO, murderous androids go on a killing spree in a futuristic Disney-style theme park.

Feeling Machines: In the 1999 movie Bicentennial Man, a household robot experiences emotions, creative thoughts, and eventually develops sentience.

Androids Among Us: Artificial beings infiltrate society undetected in TV series Battlestar Galactica.

Human Enslavement: In the 1999 movie The Matrix, all life on Earth is an elaborate facade. The robots are really the ones in command, but you wouldn’t know it until you take the “red pill”.

Mind Upload: Digitized humans gain immortality and then wreak havoc, such as in 2014’s Transcendence.

ONE CERTAINTY

While some of these ideas seem far-fetched, it’s worth noting that not all future scenarios are as distant as they may seem.

With computing power increasing exponentially, the tail end of the hockey stick could happen sooner than we may think.





Can the world’s megacities survive the digital age?

 

Can the world's megacities survive the digital age?

Courtesy of Christopher H. Lim, Nanyang Technological University and Vincent Mack, Nanyang Technological University

Today, megacities have become synonymous with economic growth. In both developing and developed countries, cities with populations of 10 million or more account for one-third to one-half of their gross domestic product.

Many analysts and policymakers think this trend is here to stay. The rise of big data analytics and mobile technology should spur development, they assert, transforming metropolises like Shanghai, Nairobi and Mexico City into so-called “smart cities” that can leverage their huge populations to power their economies and change the power balance in the world.

As technology researchers, however, we see a less rosy urban future. That’s because digitization and crowdsourcing will actually undermine the very foundations of the megacity economy, which is typically built on some combination of manufacturing, commerce, retail and professional services.

The exact formula differs from region to region, but all megacities are designed to maximize the productivity of their massive populations. Today, these cities lean heavily on economies of scale, by which increased production brings cost advantages, and on the savings and benefits of co-locating people and firms in neighborhoods and industrial clusters.

But technological advances are now upending these old business models, threatening future of megacities as we know them.

Manufacturing on the fritz

One classic example of a disruptive new technology is 3-D printing, which enables individuals to “print” everything from ice cream to machine parts.

As this streamlined technique spreads, it will eliminate some of the many links in the global production process. By taking out the “middle men,” 3-D printing may ultimately reduce the supply chain to just a designer on one end and a manufacturer on the other, significantly reducing the production costs of manufactured goods.


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Testy Tuesday – All Time Highs Ahead of the Fed, What Can Go Wrong?

What can go wrong?

Well, for one thing, the Fed could tighten.  As you can see from the Fed's own projections, which are to be released tomorrow (but are on their web site today), the Fed is projecting a Fed Funds Rate of 2.9-3.9% next year.  This year it was a much wider -0.1 to 2.9% and we're right in the middle at 1.25% but what if we're in the middle next year at 3.5%?  Are you ready for a 2.25% rate hike?  Is anybody?

Certainly people with adjustable mortgages are not ready or revolving debt (reccord highs) or variable loans like Corporations tend to have, which would add $400Bn to their $2Tn debt balance.  Are the banks ready to have their loan margins squeezed as rates climb, which is often the case?  

Even just 3% would require 7 rate hikes in 8 meetings – unless the Fed hikes us this year, then it would be 6 of 8 or, if they surprise us and hike tomorrow, they buy a bit of fexibility next year and "only" have to hike rates 0.25 every other meeting, plut one.  Their other projections are on track.  The market thought lowering the Q3 GDP forecast (see yesterday's Morning Report) would keep the Fed off the table but they are only projecting 2.0-2.4% GDP for 2017 and LESS next year – so we're right on track.

Unemployment is below their target, Inflation is above – there's really no excuse for the Fed NOT to raise rates so don't be surprised if everyone is surprised tomorrow by a quarter-point hike, hurricane or no hurricane.  Of much more concern than the rates going up (though the repercussions of that alone will be tragic) is the potential unwinding of the Fed's Balance Sheet, which currently stands at $4.47 TRILLION and that's up about $3.7Tn since 2008.  

Even if the Fed "only" withdraws their money over the same 8 years they put it in, that's $500Bn a year coming OUT of the economy – no wonder they project a significantly lower GDP next year!   Meanwhile, the BOJ and the ECB have been putting in $400Bn a month and Japan's stimulus is so out of proportion to their $5Tn economy…
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Tech Stocks as Career Obsolescence Insurance

 

Tech Stocks as Career Obsolescence Insurance

Courtesy of 

Posted this poll this morning and the results came out just I had expected.

Is it at all possible that multiples are elevated for some segments of the stock market because people are investing based on metrics that have nothing to do with those prized by prior generations of investors? And, further, is it possible that these new investor predilections – for revenue growth and industry dominion and the capacity to disrupt a wide variety of industries and TAM (total addressable market) – is completely reasonable?

Target and Macy’s and Ford Motors and Best Buy did an admirable job chugging along at single-digit percent earnings growth rates for decades. And what was the point? Who benefitted? Why should investors prefer the shares of CVS and Walgreens and other sitting ducks who persist in this same strategy?

Identifying a company with a good profit margins and a nice earnings / dividend payout may have rewarded investors in the past. But identifying the companies that are going to eat all of the other companies and, by extension, someday be able to produce much higher earnings / dividend payouts might be the better route. The stock market seems to be voting this way.

The tech sector represents 23.5% of the S&P 500 as of the end of August. And just for context, this doesn’t even include the $80 billion value of Netflix or the $474 billion value of Amazon – both are classified as consumer discretionary. It also doesn’t include the $70 billion value of Tesla, which is not even in the S&P 500 despite being more valuable than 400 of the companies in the index.

Verizon and AT&T (worth a combined $440 billion) are not in the technology sector classification, but can anyone truly argue that they do anything but technology? That they aren’t, in fact, two…
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Just Another Manic Monday – World War 3 Edition

This picture from North Korea's official Korean Central News Agency (KCNA) taken on August 29, 2017 and released on August 30, 2017 shows North Korea's intermediate-range strategic ballistic rocket Hwasong-12 lifting off from the launching pad in Pyongyang.Nuclear-armed North Korea said on August 30 that it had fired a missile over Japan the previous day, the first time it has ever acknowledged doing so. / AFP PHOTO / KCNA VIA KNS / STR / South Korea OUT / REPUBLIC OF KOREA OUT ---EDITORS NOTE--- RESTRICTED TO EDITORIAL USE - MANDATORY CREDIT Yes, I know no one cares, BUT:

On CNN yesterday, UN Ambassador Nikki Haley said the United Nations Security Council has just about reached the limit of its ability to economically punish North Korea.  Responding to a question by CNN’s Dana Bash about whether President Donald Trump’s famous “fire and fury” remark was an empty threat, Haley insisted that the US has held back out of a sense of “responsibility.” But now that diplomatic solutions appear to be dwindling, she would be “perfectly happy handing the situation off to Defense Secretary James Mattis, the source of some of the US’s harshest rhetoric against North Korea. Mattis, Haley said, would “take care of it.”   

 

 

“What we’re doing is being responsible where North Korea is being irresponsible and reckless. 


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There’s No Such Thing as a “Sin Stock”

 

There’s No Such Thing as a “Sin Stock”

Courtesy of Cullen Roche, Pragmatic Capitalism

This post will at first appear like a discussion about morality, but I hope it will end as a post about objective reasons for market cap weighted equity indexing. So hang tight even if your head starts to explode a little.

Here’s a good piece by Felix Salmon on why we should avoid “sin stocks”. In it, he disagrees with a piece by Cliff Asness and Matt Levine. The basic gist of the disagreement is that Matt and Cliff say that avoiding sin stocks could make it more expensive to finance their future operations which will lead to fewer sinful companies and Felix says that not investing in these companies is unlikely to have a meaningful real world impact.¹ I think they’re having the wrong discussion though.

This is going to annoy many of you, but a lot of this strikes me as virtue signalling. Matt, Cliff and Felix are having this discussion assuming that they know what is and what isn’t virtuous. I would argue none of us really knows a virtuous company from one that isn’t. Yes, you might have a general idea of what is virtuous, but there is no specific way to determine this other than a company that operates illegally and one that operates legally. Aside from that, the idea of a “sin stock” is rather murky. Obviously, since all publicly traded companies are operating legally then the idea of a “sinful” company must be rather opaque.

I know, I know, alcohol, tobacco, firearm and casino companies are obviously bad. They operate distasteful businesses, but they also provide goods and services to many people who find them very valuable. While most of us might find some of these businesses distasteful or even immoral they have a clientele that finds them valuable. And if a company operates legally then who is to say whether a cheeseburger (which is one of the most lethal things Americans consume) is more sinful than an AR-15? There might be degrees of sin in the way these companies produce their goods and services, but there is no clear line for the sinners vs the non-sinners.

So while you might think a stock is sinful…
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North Korea knows it can’t afford to go to war

 

North Korea knows it can't afford to go to war

Ra Mason, University of East Anglia

The current flare-up over North Korea’s missile tests and Donald Trump’s belligerent response is frightening for many, but anyone worried that Pyongyang wants to start a war is – fortunately – mistaken.

For all its fighting talk, missile tests, and mooted plans for an attack on the US’s Pacific territory of Guam, North Korea is all bluster and little bite. And while most Western audiences are well aware that an attack by Pyongyang on South Korea, Japan or the US would be suicidal, what they often miss is that North Korea wouldn’t actually be able to go to war with one of its rivals – even if it wanted to.

The north is too often misunderstood as an unpredictable rogue state led by a dynasty of mad dictators. This is an inaccurate analysis, and perpetuating it is irresponsible. As has been expertly documented by North Korea analysts such as Narushige Michishita, Pyongyang’s rulers are nothing if not consistent and strategic in their approach to the rest of the world.

When trying to understand the regime’s behaviour, it’s crucial to distinguish between strategy and tactics. Yes, North Korea frequently uses surprise as a tactic, and it is well-practiced at striking fear into the hearts of Western populations. But these aren’t spasms of demented rage; they are part of a very consistent national strategy to keep the regime going.

The north has at least three goals: to keep the world’s attention in the hope of one day securing a peace treaty with the US and its allies; to demonstrate the credibility of its military deterrent; and to deflect attention away from critical domestic problems that could lead to social unrest or even revolution.

As North Korea expert Hazel Smith has pointed out, the Pyongyang government is far from a one-man band, or even a family affair. Rather, since its establishment in 1948, a number of leading players have both competed and cooperated to preserve the existing governance structure. So while there are few checks and balances on the abuse of power, the…
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Four for Friday

 

Four for Friday

Courtesy of 

Three reads I want to call your attention to, and one podcast…

Tren Griffin culls together some business and life lessons gleaned from the comments and career of record industry impresario Jimmy Iovine. If you watched HBO’s The Defiant Ones this summer, then you know what a beast he is.

Check this out:

A Dozen Lessons about Business and Life from Jimmy Iovine (25iq)

*****

The analysts at Evercore have gone absolutely nuts for Nvidia this morning, with a boost in their price target of 180 up to 250. I’ve been long the stock since last summer (my comments here) and extremely excited about all of the applications they’ve found for their graphical processing units (GPUs) and other distributed processing chips. It’s a brave new world coming our way and the ability for a chip to carry out multiple tasks concurrently is what is going to power it all.

Red-hot Nvidia gets its most bullish Wall Street call yet due to AI (CNBC)

*****

My colleague Ben has some great stuff to say about why he loves writing and commenting on markets so much. This is universally applicable for everyone who wants to love what they do. Read this today:

Why I Love Writing About the Markets (A Wealth Of Common Sense)

*****

Finally, this morning I went for a 20 mile bike ride with Ray Dalio’s first full-length podcast interview to keep me company. And it was f***ing awesome. Ray is truly a great investor, philosopher, entrepreneur and student of the markets. He’s also got some great insights about the importance of making mistakes and screwing things up – it’s the only way we grow. Just continuing to find success does very little for our growth. I loved this message and the way he explains it. Find the two hours or so to listen to Ray’s story, via Tim Ferriss:

Ray Dalio, the Steve Jobs of Investing (The Tim Ferriss Show)

Okay, have a great weekend!





Friday Failure – S&P 2,500 Remains Elusive

Can we ignore more terrorism today?

I don't see why not, "only" 22 people were injured this morning as a bomb went off on a London Subway and that's nothing to the relief Japan must have felt when the missile North Korea fired over their heads turned out NOT to have a nuclear warhead – isn't that great?  Frankly, I don't know what it would take to spook this market anymore – it seems to only head up – no matter what happens.  Our President, of course, handled the incident in London with his usual compassion:

Loser terrorists must be dealt with in a much tougher manner.The internet is their main recruitment tool which we must cut off & use better!    

 


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Zero Hedge

Prosecutors Unveil Full Details Of Anthony Weiner's Pedophilia

Courtesy of ZeroHedge. View original post here.

Earlier today we reported that as part of the government's sentencing memorandum (published at the bottom), federal prosecutors asked that disgraced former Congressman Anthony Weiner, and the man Hillary Clinton has quietly added to the nearly infinite list of reasons why she lost the presidential election, be sentenced to about two years in prison for engaging in sexting with an underage, 15-year-old girl. Prosecutors filed paper in Manhattan Federal Court on ...



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Digital Currencies

Can cryptocurrencies like Bitcoin survive scrutiny from central banks?

 

Can cryptocurrencies like Bitcoin survive scrutiny from central banks?

Courtesy of Nafis AlamUniversity of Reading

William Potter/Shutterstock

The future of money looks very different in the world of cryptocurrencies. There is a growing consensus among businesses, investors and countries (Venezuela in particular) that these alternative forms of online money are going to dominate payments in the next decade. There may be agreem...



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ValueWalk

Tagging Fake Articles Is Failing To Combat Fake News

By Rupert Hargreaves. Originally published at ValueWalk.

So-called “fake news” and not in form of The Onion (which is obvious satire) has been around in one form or another for hundreds of years. The world’s first daily newspapers, which were printed in London’s Fleet Street in the early 1700s, were full of stories and hearsay designed to influence readers and drum up sales. However, the readership of these papers was relatively limited compared to the size of the audience available to online publications today.

]]> Get The Timeless Reading eBook in PDF

Get the entire 10-part series on Timeless Reading in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues.

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Insider Scoop

Wall Street Weighs In On Adobe's Mixed Earnings Report

Courtesy of Benzinga.

Related ADBE 15 Biggest Mid-Day Losers For Wednesday 5 Biggest Price Target Changes For Wednesday ...

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Chart School

Minor Changes: Yesterday's and Weekend Comments Remain Valid

Courtesy of Declan.

I don't want to overplay today's action as little changed in the broader scheme of things. Days like today are welcomed and help shape up swing trades for those trading in near term timeframes.

The tight doji in the S&P could be used for a swing trade; buy a break of the high/short loss of low - stop on flip side. High whipsaw risk but look for 3:1 risk:reward and maybe trail stops if deciding to go with partial profits.


Tech averages are still set up for a breakout. While not an ...

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Members' Corner

"Citron Exposes Ubiquiti Networks" But TNN Says "Not So Fast"

What do you think? (There's a comment section below )

"CITRON EXPOSES UBIQUITI NETWORKS" 

Does Ubiquiti Networks (NASDAQ:UBNT) actually have real products that sell to consumers? Of course! So did Valeant and WorldCom, but that does not stop its financials from having every indication of being completely fraudulent.

Citron will detail a series of alarming red flags and detail how Ubiquiti Networks is deceiving the investing public.

Read the full report here.

******

Rebutal by The Nattering Naybob, ...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Biotech

Can low doses of chemicals affect your health? A new report weighs the evidence

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

 

Can low doses of chemicals affect your health? A new report weighs the evidence

Courtesy of Rachel ShafferUniversity of Washington

Assessing the data. LightField Studios/shutterstock.com

Toxicology’s founding father, Paracelsus, is famous for proclaiming that “...



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Mapping The Market

The App Economy Will Be Worth $6 Trillion in Five Years

Courtesy of Jean-Luc

This would be excellent news for AAPL and GOOG to a lesser extent although not inconsequential:

The App Economy Will Be Worth $6 Trillion in Five Years 

In five years, the app economy will be worth $6.3 trillion, up from $1.3 trillion last year, according to a report released today by app measurement company App Annie. What explains the growth? More people are spending more time and -- crucially -- more money in apps. While on average people aren't downloading many more apps, App Annie expects global app usership to nearly double to 6.3 billion people in the next five years while the time spent in apps will more than double. And, it expects the...



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Promotions

NewsWare: Watch Today's Webinar!

 

We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

Join our webinar, free, it's open to all. 

Just click here at 1 pm est and join in!

[For more information on NewsWare, click here. For a list of prices: NewsWar...



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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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