10.5 C
New York
Sunday, January 29, 2023

Subscribe

Monday Market Mayhem

Good golly what a mess!

 

It looks like the administration's $800 chicken in every pot solution is not thrilling the rational part of the planet who both wonder how we will pay for this while also wondering how the hell this fixes anything at all.

 

 

I was going to write a post today about how our leaders can still save the markets but it may be too late.  We had an emergency session on the member site today, which was supposed to be a day off but turned into a pretty sad death-watch on the global markets as one after another tumbled close to 20% off their summer highs.

To that end I'm going to run a special Big Chart that will give us levels to watch out for based on various possible retracement points we are expecting based on the 5% rule (and see today's comments for an extensive 5% rule discussion).  The timing of this dip could not have been worse as I had chosen not to roll the majority of my callers last week, looking for a bounce this week, not a thud.  It remains to be seen how far 250 naked DIA puts will take me in protecting the open positions but if we actually do open at 11,600 tomorrow, as the futures currently indicate, it's going to be one hell of an offset!

Usually in the big chart we don't use futures but I'm going to make an exception with the Dow, the Nasdaq and the S&P since I can see them on Bloomberg and we need to be prepared for tomorrow.  This is some truly frightening stuff so look away if you have a weak stomach or haven't done much hedging!  Don't forget the green you see is, for the most part off of levels that would represent a $13Tn destruction of global assets in 90 days!

  Fut. or Drop 25% 20% Feeling 200
Index Current FromTop Terror Horror Better DMA
Dow 11,592 -2600 10,644 11,354 11,808 13,373
Transports 2,395 -719 2,336 2,491 2,591 2,844
S&P 1,265 -311 1,182 1,261 1,311 1,488
NYSE 8,794 -1593 7,790 8,310 8,642 9,775
Nasdaq 2,294 -567 2,146 2,289 2,380 2,614
SOX 349 -210 419 447 465 472
Russell 673 -183 642 684 712 800
Hang Seng 23,818 -8182 24,000 25,600 26,624 24,364
Nikkei 13,325 -4975 13,725 14,640 15,226 16,729
BSE (India) 17,605 -3595 15,900 16,960 17,638 16,545
DAX 6,790 -1327 6,088 6,494 6,753 7,704
CAC 40 4,744 -1424 4,626 4,934 5,132 5,752
FTSE 5,578 -1176 5,066 5,403 5,619 6,435

That's right, $1Tn a week since our October highs has disappeared from the virtual portfolios of global investors in what Bush, Paulson and Bernanke all called a "strong" economy just 2 weeks ago.  I may not be as great an economist as those guys but perhaps the use of the word strong may have made them look just a tad wrong in their assessment.  It takes confidence to keep an economy going and when the people lose faith in their leaders, they tend to pull back in their spending.

As Barry Ritholtz says in his post, "So Much for the Decouping..":  "What is rather incredible about the past few years are the number of pinheads who so totally got this wrong. Not your run of the mill idiots who insisted Housing and Credit would have no broader impact; These hacks were merely blind incompetent cheerleaders.  No, what really stunned me is the number of otherwise intelligent people who, once again, claimed "its different this time."

Roll_coaster

I highly recommend Barry's entire blog this weekend as he's summed up the issues quite nicely so I'm not going to bother rehashing them here.  I will instead offer my solution to the problem.  There is still time to get me on the ballot in Florida and I'll run as a Republican as I understand the field is wide open and nothing would be more fun than for me to get a spot in those debates – I have a thing or two to say to those guys!

Rather than toss money out of the proverbial helicopter and pray it finds its way back into the economy, I would propose targeting government spending to attack the actual problems we are facing.  By the way, the administration's plan of giving $800 back to each taxpayer only applies to people who paid more than $800 in taxes, which eliminates the bottom 28% of our nation's households.  One might think that a person who can barely afford to fill up the tank to drive to a $20,000 a year job so they can make their $1,200 monthly mortgage payment ($200K) which is properly deducted and leaves them with little or no tax bill MIGHT need the $800 more than the top 28% of the nation, who make $75,000+ a year.

The other part of "the Plan" is to allow business to make a large capital investment deduction in the hopes that this will encourage business spending but, just like the tax rebates, this is a trojan horse to send money to the rich as companies that were going to spend the money anyway suddenly find they get a fat new deduction while companies who are barely surviving can get themselves a brand new building for customers not to show up to and a fancy new phone system that will handle 30% less traffic with style!

My plan is targeted and simple:

  • Freeze mortgage rates at current levels
  • Roll back rates to an 8% maximum.
  • Freeze foreclosures pending a review and allocate funding to put families back into homes.

    • Aside from stopping 7,000 families a day from being thrown out of their homes destitute, it keeps them on the tax rolls and eases the housing surplus that is crippling the buiding industry and devaluing all homes in this country.
    • With over 100,000 mortgage brokers out of work, we should be able to review 7,000 applications a day, even in a government agency…

Note that, so far I have spent no money but I have angered some bankers who were counting on charging people double the Fed funds rate but I'm even going to take care of them:

  • Guarantee the mortgage and bond markets.

    • This is radical but, ultimately, the government is on the hook for it anyway if the whole thing falls apart and, by stepping up now, we can transform the loan virtual portfolios held by banks to AAA rated paper and they can refinance the virtual portfolios themselves at substantially lower rates.
    • This directly and proportionately helps the companies who are suffering most and allows the financial communtiy to move most of the $120Bn worth of loans they have "written off" back on the books so they can SEND US money when they pay their taxes rather than skipping them through this advanced deduction program.
    • Ambac performed this function as a $2Bn market cap company with just $18Bn in reserves, The US government will have no problem finding  a favorable way to actualize the balance sheets on this project.
  • Invest back in America
    • I will offer up to $100,000 for a fair appraisal of every home in America with a 25% reduction (ie. we get $125K in value).

      • This would reduce the average morgage of US homeowners who wish to participate by 40%, for most people, that works out to a MONTHLY reduction of a $250,000 mortgage of $666.  The government will take an ownership interest in the home as an investment with with a 4% deferred interest against the sale price. 
      • The quick math on this is $2Tn if 20% of the US homes seek the aid, the 25% bonus should deter speculators (and it would be for owner-occupied only) and keep it from over-inflating home prices.  Obviously the $2Tn can be financed which, at 4.5%, works out to $10.13Bn a month for 30 years (really, do the math!). 

Take our oil money back!

The US consumes 20M barrels of oil a day and at 42 gallons a barrel and $3 a gallon for refined products, that works out to $2.5Bn A DAY spent by US consumers on energy and NOT in other parts of the economy we are trying to stimulate.  Since we send 60% of that money overseas where it disappears entirely, just $1 per gallon costs the US consumers $306Bn a year, double what the administration thinks would "stimulate" the economy.

Rather than go further into debt, the US can tap a small portion of the 1Bn barrel Strategic Petroleum Reserve by releasing just 3M barrels a week until prices come back to $60 (our 1/3 target).  Since we will be selling this oil at the market price in competition with OPEC, we can simply put a buy order in at $60 to start replenishing the reserve.  We can also enter into long-term purchase contracts meant to encourage increased domestic production.

Since 11Mb of oil a day are used by cars, it would seem obvious that raising the US fleets average mileage from 20 mpg should be a priority of a rational administration.  Raising the average mileage of cars just 5 miles per gallon wold save us well over 2Mb a day of consumption.  Getting our fleet average up to 35 mpg, currently the goal for 2022 can be achieved much faster with incentives.

Let the auto companies know what we intend and give them until 2009 to be fair but our auto companies already compete internationally, where 35 miles per gallon is the current GLOBAL AVERAGE – they save their gas guzzlers for the US market.  Beginning in Jan 2009 we phase in a $1 per gallon gas tax over 4 years.  This will generate $300Bn a year in revenues and add 30% to the price of gas.  That 30% can be offset by any driver who wishes to purchase a higher mileage vehicle.

Establish 25 miles a gallon as a target price and offer $750 rebates per 2.5 mpg a new car exceeds them by.  Charge a $750 per 2.5 mpg penalty for whatever shortfall a new car has.  16M cars are sold in this country a year, if we gave a $3,000 rebate to every single new owner for purchasing 35 mpg cars, it would cost the government just $48Bn (which would more than made up for by the new tax) but it would reduce 15% of the nation's fleet's fuel consumption by 75%, saving over 1Mb of fuel per day in our first year! 

The incentives to buy new, fuel efficient vehicles would revitalize the auto industry and the lighter average vehicle weights would have the added benefit of reducing wear and tear on our highway infrastructure, saving tens of Billions more of federal money.  Of course, a 75% reduction in fuel would also help out with that global warming thing, just in case that's real.  It's a free market solution that even the conservatives can get behind!

This is why I still have faith in this country and our markets.  We have suffered from years of terrible policy decisions but our problems are not too difficult to solve if we find people who are willing to lead.  There are things that NEED to be done for the good of the nation but the nation needs to move past the political rhetoric and focus on solving problems and doing whatever it takes to make those solutions a reality.

Please send this to your Congresspeople, especially those who want to be President.  They can debate me or they can steal this idea and pretend it's their own – I don't care as long as something gets done in this country.  Send it to action committees and people who vote and tell them it's possible to have real dialogue and perhaps SOLVE some of our nation's problems, rather than blame the other guy or brush it under the table. 

You can find your Congresspeople's EMail HERE!

We’re going to be either very lucky or very unlucky our markets are closed today, the timing of this is incredible – almost as if it were planned to shut out US investors as 2 years’ worth of gains disappeared over a weekend.  I wonder if Hank Paulson’s old firm will do well this quarter

 

195 COMMENTS

Subscribe
Notify of
195 Comments
Inline Feedbacks
View all comments

Why all the doom and gloom? Sri Lanka is green and Bangladesh is only down .11%. Not all of Asia is going in the toilet. The countries already in the toilet are doing just fine.

don’t know much about futures … but there seems to be a 5% (up or down) overnight limit, so the futures might open 10% below friday’s close and the market will be halted for an hour tomorrow morning!!

HSCE 12000 breached already. Let’s see if people can settle down a bit after lunch.

spin the O — no that’s the article “Supplicant” –like the euphemism for beggar!! I’ve been reading the political wires today as well and impeachment is a 5% possibility I’d say–that’s not much, but Cheney deleted all his the Office of the VP emails from 2003 to 2005, permanently (backup also destroyed) which is against the law, but on the bright side of things–the rumors in the oil market for the past 2 years were that we were going to attack Iran: now this seems much less likely!! So, -10%, no biggie, no Iran war, which would bring us down 20% in a day or so–count your blessings!!

JR- I was referring to your “something must be done politically” post.

I’m so excited about tomorrow that I can’t sleep. My few Feb 42 & 41 puts should be ca chinging at the open. I just hope the Fed doesn’t spoil my fun with an ill timed announcement before the open. Sorry if my glee comes at a bad time for may of you who are long, but I am down 84% since July and feel like I deserve a break finally. Plus I feel this correction is healthy for the markets long term.

opps – I was anonymous at 2:11 am above

Beware of the Deathline. Hah okay I had my fun.

I enjoy shorting the market, but the selling got stupid. I do not see anything to justify the decline, and I think shorting the market at these levels is a dangerous decision (atleast before the cut).

Now, from what I understand…Europe went down because of the US, and the US is down because of Europe… This sounds like an emotional decline, rather than a factual one. Be careful.

This is not an indicator to buy, because as opt would say… The trend is down.

Lets have a PSW holiday this week! Maybe here: http://www.sandylane.com/ ??

Greg – You do deserve a break! Go take your cake!!!

“It’s like a funeral in here,” said Ken Masuda, senior equities dealer at Shinko Securities in Tokyo. “No one knows what’s going to happen tonight in New York. It’s like we’ve gone blind, you don’t know what’s coming.

“Until we see New York, all we can do is sell,” he said.

http://www.reuters.com/article/newsOne/idUSSP15608620080122

Good Morning from the UK. Here we go again….

The initial selling on the FTSE Tuesday morning sent the index down nearly 5% settling about -3.7% after the initial flurry. Marketwatch is reporting a truely dreadful session in Asia:-

…………Trading on India’s Sensex was halted when the index plunged more than 11% at the open. Trade resumed, but losses pile up.

• India’s Sensex: -11.2%
• Japan’s Nikkei 225: – 5.7%
• Hong Kong H-shares: -13%
• Hong Kong’s Hang Seng: -9.1%
• Shanghai Composite: -7.2%

Dow Futures are now down 650 points !!!!!!!!

So, guys, it is up to you on the east coast to save the world 🙂

Initial DAX: -7.2% (-524)

DAX retraced back to 6690, let’s see if it holds, or it will dip again.

DAX going back down (already at 6640);

Too bad I’m at my day job (and having a bunch of telecons) to play the DAX ups and downs…

Make that 6600.

Good morning Phil – staying up all night for the excitement ?

As you said some of the FTSE went green for a while but the sellings started again. About 0.85% down which is SO much better than the -5% open. Hope it curbs some of the panic when the US opens.

My oil stocks took a big hit yesterday, BP, PMO they are recovering a bit. Gold miners taking another big hit. I presume people are getting out of commodities assuming a recession.

If the UK survives at these levels then we’ll have held up a little better than India and HK.

Eight out of 11 housing/Builder stocks in the FTSE are green. Wonder if thats a sign of a bottom in our housing stocks ?

Starting to see US prices in Etrade now. How do people manage to trade US stocks at this time of day ?

Appl = $144 -10.6%
Orcl = 19.44 -9.92%
Goog = 575 -4.21%

Very big rebound now in progress in the UK. FTSE up 0.8% back over the 5600 level we discussed yesterday. Gold and Oil still lagging.

Asia Markets : Tuesday, January 22, 2008

(The following is from WSJ; please cross check with other sources to confirm.)

Japan

12573.05
-752.89
-5.65%

Hong Kong*

21757.63
-2061.23
-8.65%

DJ Shanghai*

490.80
-41.88
-7.86%

S.Korea*

1609.02
-74.54
-4.43%

India*

16750.15
-855.20
-4.86%


Baltic Dry Index (BDI)
+51 6513

* at close
Sources: Dow Jones, Reuters

Madness, the indexes are fluctuating by nearly 1% every 15 minutes. Tug of war going on here. Still positive (0.5%) and just holding 5600.

US prices on Etrade look pretty bad , Apple getting a little better. $146

Asian Stocks Get Hammered, Australia Bleeds 7%
The bloodletting continued in the afternoon session Tuesday, with stocks getting hammered across Asia. The Australian market shed a massive 7 percent, its biggest ever one day percentage drop. Japan nosedived 5.65 percent while South Korea closed down 4.4 percent. Growing fears of a U.S. recession sparked massive selling. India’s Sensex crashed more than 11 percent triggering a trading halt. Hong Kong’s Hang Seng Index plunged 8 percent, losing over 1,900 points. Singapore shares plummetted nearly 5 percent.

A common definition of a bear market is a fall of around 20 percent over a recent period or from a recent peak, characterised by a pessimistic outlook.

As of 2:00 pm, Hong Kong/Singapore time, regional markets were posting double-digit losses year-to-date, with Hong Kong’s Hang Seng Index down over 21 percent followed by Australia and Japan. In Tokyo, the Nikkei plunged 5.65 percent to a 28-month closing low, its biggest one-day loss since the session after the Sept. 11 attacks on the United States in 2001, as growing fears about the U.S. economy sent global stocks reeling. The Nikkei has lost more than 1,000 points and 9 percent this week. South Korea’s KOSPI ended down 4.4 percent , the biggest daily fall in six months, to hit an eight-month low as concerns over a slowdown in the global economy hit exporters. Australia’s S&P/ASX 200 Index lost 7 percent in its biggest-ever one-day percentage drop, to record its 12th straight session of declines. Mining stocks, sensitive to any economic slowdown, led the decline.

In markets still trading, Hong Kong stocks dived as recession fears gripped investors, sending China plays down nearly 12 percent to mark their worst percentage loss in ten years. The Hang Seng Index also plummeted, ending the morning down 8 percent to break below the key 22,000 point level for the first time since August when the subprime debacle roiled financial markets. China’s Shanghai Composite Index was more than 4 percent lower because of sliding overseas markets and the prospect of big supplies of new shares, though blue chips came well off their early lows.

The Bombay Stock Exchange fell more than 11 percent in the first few minutes of trade as panic-stricken investors dumped stocks, setting off circuit breakers that automatically halted trade for an hour. Trading was also briefly halted on Monday afternoon when the market had fallen almost 11 percent.

Euro Stocks Pare Losses, Still in the Red
European stocks pared earlier losses but were still in the red more than one hour into a very volatile session. Major European markets fell nearly 6 percent Monday, their biggest one-day drop since the Sept. 11, 2001 terrorist attacks in the U.S., on fears of a U.S. recession.

The London and Frankfurt markets, which had opened more than 4 percent down, have recovered slightly. In France, some bargain-hunters have started scooping up financial stocks. Asian stocks plummeted, as growing fears of a U.S. recession sparked a wide selloff. Meanwhile, French Economy Minister Christine Lagarde said that Monday’s fall in major Asian and European stock markets was a “brutal correction” but added that the fundamentals of the European economy are solid, Reuters reported.

Some analysts said it was too early to say whether bargain-hunters would definitely step in to take advantage of the discounts.

“I think markets are deeply oversold…I think there are lots of opportunities out there, but there are early days, the markets are very volatile,” Charles Morris, from HSBC Investment

Copper falls as equity markets post losses, economic woes linger
Copper declined further after yesterday’s slide in line with the wider financial markets, as fears of a global economic slowdown deepened and with investors selling off assets such as metals to cover losses elsewhere. Other commodities including gold and oil also fell sharply. The red metal’s soft start on the LME followed a weak session in Asia, where Shanghai copper futures fell by their daily 4 pct limit, as a global sell-off in equities heightened concerns of recession in the US.

At 9.52 am,
LME copper for three-month delivery was down at 6,785 usd per tonne against 6,870 usd at the close yesterday. Among other metals, three-month
nickel fell to 26,800 usd per tonne from 27,750 usd, while
tin was at 16,000 usd against 16,075 usd.
Aluminium eased to 2,400 usd per tonne, basis three months, against 2,413 usd per tonne, while
lead was down at 2,470 usd against 2,515 usd.
Zinc tracked the complex lower, down at 2,190 usd against 2,230 usd.

Dollar firm as equity market falls prompt safe haven buying
The dollar remained well supported as a second day of losses on stock markets prompted safe-haven buying of the US currency, with speculation that a number of central banks are considering emergency interest rate cuts. Asian equities have all fallen sharply overnight, and European bourses followed suit opening between 3 and 5 pct lower.

“The market is now generally starting to digest the view that any decoupling from a US-led slowdown in G10 economies is becoming more unlikely and repatriation flows are keeping the dollar supported,” said Geoffrey Yu, currency strategist at UBS.

London 0925 GMT Hong Kong 0500 GMT
US dollar yen 106.32 up from 106.03
Euro usd 1.4451 up from 1.4413
Sterling usd 1.9477 up from 1.9383
Australian dollar usd 0.8557 down from 0.8563

Oil plunges amid global equity market turmoil, looming us recession fears
Oil fell to its lowest level for more than a month as yesterday’s global equity sell-off continued in Asia this morning, sparking renewed fears that demand for crude will wane if the US heads into recession, as looks increasingly likely. Stock markets in London and Europe recorded their biggest one-day falls since Sept 11 yesterday, as concerns about global credit market turmoil and a looming US recession sparked panic selling amongst investors.

At 10.10 am, New York’s WTI crude for February delivery, which expires later today, was quoted at 87.80 usd against 90.57 usd at the close Friday. The NYMEX exchange did not set a close yesterday as floor trading was shut for the Martin Luther King holiday. In London, Brent crude for March delivery was down 83 cents at 86.68 usd per barrel. Prices on the NYMEX exchange dropped to 86.11 usd earlier, their lowest since early December. However, they have since recovered amid rumours about possible coordinated emergency rate cuts by global central banks.

Elsewhere, players are growing increasingly concerned that with oil having dropped some 12 pct off an early January record high of 110.09 usd, OPEC is not likely to raise output when it meets next month. OPEC, which supplies nearly 40 pct of the world’s crude, is growing increasingly ambivalent in the face of calls from US leaders for it to raise output to cool energy markets and support the global economy. Saudi oil minister Ali al-Naimi said last week the cartel will only raise output when the market justifies it, adding current inventory levels seem normal. OPEC ministers often follow the lead of the Saudis when discussing whether to increase production.

Gold knocked below 860 usd by global equity plunge, rising dollar
Gold was knocked down to its lowest level in almost three weeks in early London trade, as plunging global stock markets forced funds to liquidate profitable commodity positions to cover margin calls. At 9.28 am, spot gold was trading down at 859.13 usd per ounce, against 865.10 usd in late New York trades yesterday. Earlier, the precious metal dipped as low as 849.30 usd, its lowest level since Jan 2, before recovering slightly on bargain hunting.

“We’re witnessing a tussle between margin calls and safe haven buying. For now, the metals are being sold because they are seen as risky assets. Gold always suffers initially during bouts of deleveraging, but we may see pockets of safe haven buying emerging.” With investors fleeing into the security of US Treasury bonds, the dollar has strengthened against the euro, diminishing gold’s appeal as an alternative investment to the US currency.
Oil prices are also weighing on gold, dropping by over 3 usd so far this morning, reducing inflationary pressures which have buoyed bullion in recent times.

Elsewhere, platinum was lower at 1,517 usd per ounce, against 1,539 usd. Palladium was down at 359 usd per ounce, from 361.50 usd, while silver eased to 15.46 usd per ounce against 15.60 usd.

Market Massacre: As students of markets, it is fascinating to watch the meltdown globally. Hopefully we learn a lot of things. The painful part of course, is our portfolios. Thanks to Phil, at least we can try figuring how to contain potential losses. In other crisis, panic was natural. Interestingly, this time around, I am not in the panic mood.

I know the reason. Thanks, Phil.

UK Continuing to bounce. Up 0.7% I suspect the US open will drag it down again.

US prices still look very bad. QID short shares showing 7.8% gain.

JR & KHAANN!!!!

Sorry I didn’t get a chance to reply last night.

One thing I haven’t mentioned on here, as I don’t think its a big deal, is that I am an OIF and OEF veteran, and still serving. My wife was one of the first people into Afghanistan in 2001 with 18th Airborne Corps. We both have seen our share (I’ve seen a little more as an Infantryman with the 82nd Airborne Division, spent 8 months in Fallujah before the Marines took over). So I’ve seen it first hand. I voluntarily signed up in 2002, shipped in 2003. I re-enlisted during this conflict. I am now in college in the ROTC program and will graduate in May and return to service as a commissioned officer (this time in Aviation, I like to say that I went from better to best in jobs). I add all of this as background.

I don’t have much to say about what you said, JR, as far as a rebuttal. The way Vietnam vets were treated was horrible. Iraq vets, though, are treated better than Vietnam era vets were. You said, “If you think America is not taking advantage of the Iraq vets, show me the GI Bill and show me the working Heathcare and support system.” Well, my wife currently receives disability payments from the VA for her service, and she has used some of her GI Bill benefits (I say some not because they were taken away, but because with 2 daughters and both of us working, by choice, school isn’t happening right now).

The benefits are there, they’ve never been taken away. Is it a crap shoot when it comes to how easy it is to get those benefits? Unfortunately, yes. My wifes journey through the disability claim process was quick and painless. Getting GI Bill benefits was as well. Also sad is that a large percentage of people that served and are eligible for the GI Bill wind up, voluntarily, never using those benefits.

KHAANN!!!!,
Comparing violent deaths to violent deaths (or even major US city violent deaths to total US deaths in Iraq, violent & non-violent), Iraq is still a very safe place. I’m not saying this as a “tool” of the administration, I say it because I have been there, and will be there again, more than likely.

And yes, I have experienced an IED first hand, on more than 5 occassions, as a matter of fact. I saw one of them kill a squad leader in my platoon and injure half of my squad. A piece of shrapnel barely missed me on that one. By the luck of God or something, 2 out of 3 daisy chained IEDs failed to explode on another occasion, one of those 2 was right beside my door on the Humvee.

Have you?

I appreciate the sentiment that both of you are showing, I really do. I know many Americans and non-Americans alike don’t like seeing US service men and women killed. But we volunteered for this, over 50% (I do not have the hard numbers in front of me now) of the armed services signed up since 9/11. All of us share a bond, and in the end, as maddening as it may be to you, hearing people say things like you say does anger us. It feels like our parents saying, “We’re proud of you, but at the same time, you made a bad choice.” Just because you don’t understand it, doesn’t make your POV right.

Phil

Unlike Ramana, I am in somewhat a panic mood, but I would like to panic in an orderly fashion.

Earlier you wrote

“Turn your longs into put/call spreads – If you have 10 GOOG June $620s at $57 and they drop $10 at the open, buy 5 $20 Feb puts (with $5 stops), even if you have to sell 2 to do it. At this point, if you can’t roll down a caller effectively (1st choice) you just want to get neutral to ride this out. If you have (like me) a ton of open positions, you are better off with index puts but I stress only if we open down 5% and keep going lower or weak bounce off a 20% retrace (120 dow points from the bottom, 20 Nas points, 15 S&P points). XXX”

First choice is to roll down the caller.
If your leap is say strike $50 and your stock has opened at $40, would you a)cover with Feb 40 or would you go out further and cover at a price which will pay for you to roll yourself down. (I realise that there is margin requirement to sell a cover with a strike lower than your long, this would be a temporary measure)
b)When would you start selling covers? at the open or wait and see?
c)Would you buy index puts at the open? You said yesterday to buy liquid April puts and sell against.
d)For uncovered longs on Apple (July & April 165) is the best strategy the put/call spread because it will not be possible to sell against?

paulson is speaking with a minimum amount of confidence and a maximum amount of nervousness, like he’s lying.

Jake —

Many thanks for your service. It is most appreciated and I am glad there are courageous Americans (like you and your wife) who are willing to serve under the most difficult of circumstances.

WOWSERS WOWSERS someone through a BIG ROPE!!

Jake,

I had no idea you had served in the armed forces, so my utmost respect to you. Even though I am not in the services, I am from what the State Department refers to as “one of the most dangerous places on earth” Kashmir, India. I lived there in 1995, when I was 15, during the height of violence. I am no stranger to the IED, and have seen and felt the affects first hand.

Anyway, we’ll continue after hours. Time to batten down the hatches, theres a mighty storm brewin.

Fed just cut 0.75

KHAANN!!!!

Sounds good, agreed we should continue AH.

new post up
best of luck to everyone today!

Emerency rate cut 3/4 duh

Stay Connected

159,326FansLike
407,367FollowersFollow
2,150SubscribersSubscribe

Latest Articles

195
0
Would love your thoughts, please comment.x
()
x