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  1. Phil

    Good morning!

    I wish the market were open today – so many fun things going on…

    AAPL/Dawn – When something is drastically undervalued, it's pretty much a little jack in the box and the little crank just keeps turning and turning until some special note pops it.  I don't mean like Friday, that's just a wriggle in the low range – I mean a $50-$100 run over a couple of days kind of thing – some event when people say "hey, those guys make a LOT of money!"  As I noted to someone the other day, with AAPL, it could be one of about 10 things – that's what makes it such a good long.  

    They've already had the kitchen sink thrown at them as far as negatives go.  And, don't forget, those negatives are being thrown at AAPL by a media that's controlled by 6 companies – all of whom hate AAPL because they have taken control of the music business and are taking control of the publishing business and trying to take control of the TV business.  There are, annually, tens of Billions on the line here and these 6 companies will do whatever it takes to keep AAPL from succeeding:

    Keep in mind that Newsweek stopped publishing it's paper edition this year – these guys are terrified about losing control of the future – especially to someone who's not even in the club.  Jobs tried to build bridges with Disney, who are the least evil of the 6, but they just wanted to get Pixar and had no real interest in giving AAPL content, which went to Hulu and NFLX as soon as Jobs died.  

    AAPL is a disruptive force and there will be all-out content wars in the future.  So the studios and the TV stations and the news media look for any way they can to keep AAPL down – the same way they work very hard to keep Americans from seeing Al Jazeera as a viable entity – even though they are Walter Kronkite compared to Fox.  Overall, it's a long game that's being played and I wouldn't want to guess WHEN something will happen and, frankly, I don't care – because I'm much more patient than that.  

    If you buy a company for a long-term hold, you should buy it BECAUSE you want to hold it long-term, like a house.  And that means you buy it once and then, 10-20 years later, maybe you have occasion to sell it.  In between, you don't obsess over the PRICE because it doesn't matter.   People know and accept this about homes but can't accept it about stocks – even though most of us in the top 1% have a lot more money in stocks than we do in homes.  

    I put up notes last week about how just keeping money in the SPX beats almost every other ETF or hedge fund over the long-haul.  Buffett is notable for beating the S&P over 50 years but what does Buffett do – buys and holds.  This is the hardest thing I try to teach because there's no substitute for experience over time here.  Only by going through the cycles – USING a buy and hold strategy (modified with our scaling and selling premium strategies, of course) does it become clear to you what nonsense all these other "systems" are.  

    Sure it's fun to make short-term trades and I love them as you need something to do while you wait for your trees to grow large and bear fruit but it's also important to keep in mind that short-term trading is just gambling – and should never be taken too seriously.  

    A guy with an apple orchid can afford to give some away but the guy who's juggling 10 apples to survive can't afford to drop even one or two but the guy with the orchard started with 10 apples worth of seeds – and a different philosophy. 

    AAPL should buy a studio:  VIA is $32Bn, NWS is $72Bn, TWX is $53Bn, DIS is $104Bn, Vivendi $22Bn (Bertelsmann is private but around Fox's size).  They haven't because, if they bought one, the others would go insane.  Jobs took Disney stock for Pixar ($7.4Bn) and I think he intended to push for a greater alliance but Disney knew all they had to do was wait and the stock would end up getting redistributed among Steve's heirs, so there was no danger giving him 10% of the company (largest shareholder at the time).  

    The problem at the moment is Steve Jobs had a Tim Cook to run the company for him so he could run around making deals and, of course, his fanatical personality allowed him to ram deals down the throats of record companies at a time when their sales were weak and they were looking for an answer anyway.  Books are more or less a done deal as well but not magazines and newspapers nor TV or Film and that's where the real money is.  

    Tim Cook doesn't need a Tim Cook to run AAPL, Tim Cook needs a Steve Jobs to get out there and make those deals but that's very hard to replicate as part of what made Steve Jobs Steve Jobs was the fact that he came into a room with his reputation glowing around his head like a halo and every word he said carried the full weight of the AAPL Corporation – because the board learned (since they fired him and wrecked the company) never to say no to Steve.  

    You can't replicate that by hiring some guy, no matter how good he is.  

    Of course, Steve Jobs has only been dead for a year and 4 months – so maybe we should give Tim a chance! 

    By the way, Cook donated $100M of his own money last year (mostly to Stanford Hospital and Project Red to fight AIDS and such) and AAPL matched employee charity donations up to $10,000 a year.  AAPL is also spending $100M to move some of it's Mac production back to the US – starting this year.  

    This is not a company (or a CEO) playing a short game and, as we are well-aware, not many investors play the long game.  That makes companies like AAPL fantastic buy opportunities for me, Buffet and the 4 other guys left who actually like to own great companies for the long-term.  



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Zero Hedge

Secret Court Permits NSA To Keep Collecting Our Data

Courtesy of ZeroHedge. View original post here.

Submitted by EquityNet.

Earlier this week the FISA court ruled the NSA can continue the bulk collection of phone metadata until November 29. This comes after Congressional gridlock allowed for Section 215 of the Patriot Act, the legal cover for the collection program, to expire on June 1.

The secret court’s ruling overturns that of the US Court of Appeals for the Second Circuit, which ruled in favor of the ACLU’s suit claiming Section 215 could not be reasonably interpreted to allow the bulk collection of our phone data back in May. In his statement, FISA Judge Michael Mosman irreverently stated, “Second Circuit rulings ...



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Market News

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Financial Markets and Economy

Did the IMF Just Open Pandora's Box? (Zero Hedge)

By now it should be clear to all that the only reason why Germany has been so steadfast in its negotiating stance with Greece is because it knows very well that if it concedes to a public debt reduction (as opposed to haircut on debt held mostly by private entities such as hedge funds which already happened in 2012), then the rest of the PIIGS will come pouring in: first Italy, then Spain, then Portugal, then Ireland.

Baker Hughes rig count rises for the first time in 29 weeks (Business Insider)

The number of US oil rigs in use just rose for the first...



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Phil's Favorites

Good On You, Greece--But Don't Waver Now (Part 2)

 

Good On You, Greece—–But Don’t Waver Now (Part 2)

Courtesy of 

Yesterday the embattled Greeks delivered still more body blows to the rotten regime of Keynesian central banking and the crony capitalist bailout state to which it is conjoined. By defaulting on its IMF loan, walking away from the troika bailout program and taking control of its insolvent domestic banking system, Alexis Tsipras and his band of political outlaws have shattered a giant illusion.

Namely, that the world’s debt serfs will endlessly and meekly acquiesce to whatever onerous, eleventh hour arrangements might be concocted b...



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Chart School

Neutral Day

Courtesy of Declan.

After yesterday's gains there was no more gas in the tank to squeeze any more out of the market. Worryingly, the Russell 2000 finished near Monday's lows in a relative loss to S&P and Nasdaq, suggesting bearish leadership will come from speculative Small Caps, and that further losses are likely. The S&P recovered afternoon losses, but the Spinning Top candlestick of today suggests the advance is slowing, and what may be emerging is a 'bear flag'. In the meantime, the index is caught in a no-mans land between resistance and support. ...

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All About Trends

Mid-Day Update

Reminder: David 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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Kimble Charting Solutions

Shanghai index creates historic reversal pattern like 2007

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Much of the attention around the world seems to be revolving around a small country called Greece. What about the most populated country in the world (China), any key messages coming from there of late?

Well another Month, Quarter and Half a year are in the books. With this in mind I wanted to look at Monthly action of the hottest stock market in the world, the Shanghai Index. Above looks at the Shanghai index over the past 25-years. The 100%+ rally over the past year has pushed the Shanghai index up to its 23% Fibonacci ratio and a long-term resistance line, that has been in play for 25-years at (1) above.

As the Shanghai index was hitting this...



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OpTrader

Swing trading portfolio - week of June 29th., 2015

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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Digital Currencies

BitGold Now Available in US! Why BitGold?

Courtesy of Mish.

BitGold USA

Effective today, BitGold Announces Platform Launch in the United States.

BitGold, a platform for savings and payments in gold, is pleased to announce the launch of the BitGold platform for residents of the US and US territories. As of today, US residents can sign up on the BitGold platform and buy, sell, or redeem gold using BitGold’s Aurum payment and settlement technology. US residents will also have access to the BitGold mobile app and a prepaid card when these features launch over the coming weeks. Send and receive gold payment features are not initially available in the US.

About BitGold

...



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Sabrient

Sector Detector: Bulls under the gun to muster troops, while bears lie in wait

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

Courtesy of Sabrient Systems and Gradient Analytics

Two weeks ago, bulls seemed ready to push stocks higher as long-standing support reliably kicked in. But with just one full week to go before the Independence Day holiday week arrives, we will see if bulls can muster some reinforcements and make another run at the May highs. Small caps and NASDAQ are already there, but it is questionable whether those segments can drag along the broader market. To be sure, there is plenty of potential fuel floating around in the form of a friendly Fed and abundant global liquidity seeking the safety and strength of US stocks and bonds. While the technical picture has glimmers of strength, summer bears lie in wait.

In this weekly ...



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Pharmboy

Baxter's Spinoff

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

Baxter Int. (BAX) is splitting off its BioSciences division into a new company called Baxalta. Shares of Baxalta will be given as a tax-free dividend, in the ratio of one to one, to BAX holders on record on June 17, 2015. That means, if you want to receive the Baxalta dividend, you need to buy the stock this week (on or before June 12).

The Baxalta Spinoff

By Ilene with Trevor of Lowenthal Capital Partners and Paul Price

In its recent filing with the SEC, Baxter provides:

“This information statement is being ...



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Mapping The Market

An update on oil proxies

Courtesy of Jean-Luc Saillard

Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself. 

Since...



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Promotions

Watch the Phil Davis Special on Money Talk on BNN TV!

Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene

 

The replay is now available on BNN's website. For the three part series, click on the links below. 

Part 1 is here (discussing the macro outlook for the markets) Part 2 is here. (discussing our main trading strategies) Part 3 is here. (reviewing our pick of th...

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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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