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GDPhursday – Jobs, What Jobs?

Does it matter if we have a good GDP and no jobs?

That's a question that will have to be considered today as the powers that be try to make a big deal of the fact that we are getting worse more slowly, even as the Q2 GDP report is expected to be 60% WORSE (-1.6%) than last quarter (-1%).   It's very possible we get a small beat today (it will be tragic if we don't) as crude oil prices jumped 25% in May and June (forcing Americans to spend money – yay GDP!) and exports nearly doubled, non-defense capital goods gained about 5% and, of course, the stock market jumped 15%.  In the 3 months of Q2 we lost 1.3M jobs and the average workweek for those lucky enough to still be working dropped by 4% AND their pay dropped 1.5% but hey, who cares, AIG's stock is up!

My daughter has it all figured out, she lost a tooth last night and got a visit from the tooth fairy and at breakfast she was speculating that the little pixie is probably using all those teeth to build houses for homeless people.  I didn't have the heart to tell here that, at $5 per tooth, it was probably cheaper to stick with lumber but she may be on to something as TOL blew through $472M in their last quater, losing $2.93 a share on the sale of just 792 homes in the entire United States of America (about 5 homes per month per state).  That's almost 100 Million teeth!  Maybe my daughter is onto something with this tooth house idea as clearly the wooden ones can't be sold profitably… 

DESCRIPTIONTOL isn't the only one running on empty last quarter.  We all know that the GDP is currently being boosted by the largest government stimulus package in history.  Government spending this year is trending to 30% of GDP, that compares to 12% at the height of Roosevelt's New Deal.  Of course we don't actually HAVE 30% of the GDP – we were running a huge deficit before the government had to jump in to "help" and we are now borrowing almost 40% of our spending and really we're borrowing 62.5% of what we spend because WE'RE NOT SUPPOSED to be using Social Security and Medicare money to pay for current programs.

That of course, went out the window when we gave George Bush II the keys to Al Gore's lock box but no sense crying over a spoiled economy is there?  And how much of our government's spending is going on these New, New Deal programs?  Less than 5%.  In fact, the grand total of all Non-Defense Discretionary spending slated for 2010 is 18.5% of the government's budget.  That is less money than we spend on the interest on the existing debt!  No wonder brother cannot spare a dime as Big Brother's intakes (which are 62.5% short of break-even) are 81.5% taken up by items over which they have no control.

Well, I say no control as if we HAVE to spend 19% of our government's budget on Defense.  Japan spends almost nothing on Defense, that's why they can afford to finance our deficit with all those cheap Yen.  Our "entitlement programs" of Social Security, Medicare and Medicaid take up a whopping 38.2% of the government's budget and accounts for $600Bn a year in spending.  Over the past 60 years, about $7Tn has been collected by our government FOR Social Security and Medicare.  We can see from the above chart that the program had a huge boost in the 40s and 50s when the government plan was "give us lots and lots of money you can't get back for 20 years and hopefully you'll die before you can collect."  This was a GOOD plan and we lived on decades of "supluses" and you would think that a person who worked from 1965 to 2005, having 14% of his wages put away for SS and Medicare could expect that 5.6 year's worth of his income invested over 40 years would be enough to carry him through his retirement.

After all, even if the man earned just $20,000 a year and was forced to give just $2,800 to the government and even if they invested in with an average return of just 4% over 40 years, then the government should have $276,714 set aside for him.  This is something the conservatives just don't get when they rail against "entitlement" programs.  It's an entitlement because it's THEIR money, not yours.  The money the retirees saved was effectively stolen in order for the government to pretend it was OK to lower taxes and, now the health care costs are spinning out of control and straining what little is left to pay out for the program – it's the program that's being vilified while attempts to control costs by fixing health care are being shot down in one of the biggest smear campaigns in the history of American politics (and we have had some doozies!).

Why am I bringing this up today.  Because it doesn't matter how good or bad the GDP numbers are – it's the jobs that matter.  Less workers is less income for the government and less money going to Social Security and more borrowings by our government every month and more people to support and less people to buy and a 4% drop in the workweek for those left working and a 1.5% drop in pay is another 5.5% effective unemployment so that's another 7.7M people's worth of lost jobs through wage cuts IN ONE QUARTER. 

I am outraged this morning because our friends at Bloomberg, who I thought were above the GS/MSM market manipulation game "just so happened" to choose this morning to vilify our friend Nouriel Roubini saying: "Anyone attempting to apply Roubini’s wisdom to stocks may be forgiven for missing the biggest rally since the 1930s as the Standard & Poor’s 500 Index climbed 52 percent in six months. While Roubini said in March the advance was a “dead-cat bounce,” that it may “fizzle” in May and warned in July that the economy’s “not out of the woods,” the MSCI World Index was posting a 58 percent gain, the largest since it began in 1970."

What Bloomberg fails to mention is had that same investor heeded Roubini's warnings and gotten out when the S&P was at 1,500, they would still be 50% ahead of the people who don't believe in fundamentals and are BUYBUYBUYing today.  I myself have turned negative on the market since we broke over my 9,100 range on the Dow but I am, as yet, unrepentant about not taking full advantage of the last leg of this rally as it just doesn't seem justified by the fundamentals that are underlying the market.  Sure we've taken plenty of long plays but they have been cautiously hedged and we still feel the big money is going to be made on the downside in the near future.  

Asia sold off this morning (about 1%) and Europe is mixed and our GDP did, indeed, come in much better than expected at just -1%.  "Only" 570,000 people lost their jobs this week vs. 580,000 expected so we should be off to the races but we are not and one could only conclude that that is because we are already too high.  If the market doesn't finish the week at or above the mid-week highs, I think we may have finally found a top.  Meanwhile, we have continued to be wishy-washy with our covers but that will end this weekend, where we are more likely to go more bearish. 

We have had trouble filling our new $100K Virtual Portfolio and I decided yesterday we should wait to see what happens after the GDP so today will be more watching and waiting but I see nothing in the actual figures that indicates a strong enough economy to justify the p/e ratios we are being asked to pay for so many stocks (91%) that are above their 200-day moving averages. 

 


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  1.  AIG pre-market 41 !!!….
    oh please please please let it still be up there after the morning open !!!


  2. Announcing a new schedule for the 787 just after a somewhat lackluster Claims number.  Clever.


  3. Pharmboy/ Phil
    PARD
    Is the trade on PARD still buy the stock, sell Dec 5 put/call ?


  4. Merk – I’d sell that on open ASAP!  Nice win btw.


  5. Nothing solid in AIG price move.
    Shares of bailed-out insurer AIG ( AIGnews - people ) looked likely to rise sharply when trading resumes Thursday after the company’s chief said he was looking to its founder, Maurice "Hank": Greenberg, for help in rescuing the firm. Robert Benmosche said late Wednesday he had sought Greenberg’s advice on AIG’s future despite the founder’s ongoing battle with the company after being ousted several years ago. Benmosche also hinted he would not rush to sell AIG’s various businesses if the market wasn’t willing to pay a fair price. AIG shares gained 11% during regular trading and another 2% after the bell.


  6. I didn’t vote for GWB II in 2004 but he did not pilfer SS. It was LBJ in 1965 with a Democratic congress, to pay for his Great Society that would end all poverty for all times and to pay for the Vietnam war. That all worked well didn’t it? Al Gore would never have locked it back up as both parties were having too much fun spending the "free money".


  7. PARD/qcmike – yes….


  8. Morning
     
    Merk , are you going to sell some long positions or open short?  BTW I’m not surprised with $40 on AIG, its a $2 pre-inverse-split (1:20) and it will not be crazy to see a $3 pre-inverse-split translated to $60. Still those waters are only for the brave reckless  (or careless) and the crazy traders :-)


  9. Pharmboy
    Thanks


  10. Only $5 a tooth? C’mon Phil……8)


  11. FT has an article today on unprecedented NG storage problems in US. Speculation is that the stuff could start backing up into the pipelines. And, hard as it is to believe, prices could fall further. I’m naked on my UNG longs. Maybe should be considering covers if it breaks lower.


  12.  Hey Phil… what do you think of an earnings play on DELL?
     
    During the last 2 months DELL double tested resistance at 14 and then it had a bullish breakout. I’m scaling into Sep 15 calls this morning. I’m targeting the higher resistance at 15.68 on my chart.
     
    http://timelineonev83.blogspot.com/


  13. Phil – Stirred up, R we? 


  14.  What times is the gdp number coming out?


  15. almost one our ago.. was -1%


  16. GDP/oldG – it is out…..


  17. Holy inflation! $5/tooth? Back when I was a kid it used to be $1…


  18. What an anaemic  open !


  19. AIG/Merk – I’d take that money and run.  If it were a real stock (one that obeyed the laws of economic physics)  I’d short it. 

    BA/Smasher – I keep telling people you can’t bet against one of 2 airplane makers on the planet.  People do fly, no matter what.

    PARD/QC – If you can still get the spread then sure.

    LBJ/Nitro – I’d love to debate but we are observing a ban on political discussion.  Members who want to talk politics can go to Cap’s site.  I was just doing the math and had THE GOVERNMENT (in all its administrations) just taken that money and put it in normal CDs for 60 years, then the SS fund would have about $20Tn and would be able to pay all outlays out of 4%interest and would still be growing by about $300Bn a year.  That’s just sad…

    $5/Chaps – If I paid more she’d be tearing them out…

    Nat gas/Chaps – I’ve been saying that for a year.  There is WAY too much nat gas and you should be part covered on UNG as it’s a hurricane play and nothing more.

    BA squeezing the poort shorts and holding up the Dow.


  20. I love reading your comments each morning as it pertains to investing, but I really get tired of you leaving your liberal buddies out of the equation when you talk about the state of the economy.  Your "its Bush’s fault" mentality really gets annoying.  You gripe about GS but who does Obama appoint, GS guys and not a peep from you.  SS et al was in bad shape long before Bush showed up.


  21. Phil,
    I see the "NO POLITICS" light is flickering this morning.
    I vote for checking the wiring and getting it back ON. We are in the midst of a critical market turning point (in my opinion) and don’t need any distractions.


  22. BA Dreamliner annoucements are like an amusement park!!


  23. Phil, any changes to the new $100k portfolio, or get filled per prior alerts as you can?


  24. Hi Phil, $100kp question pls I may have been silly (?) but my UYG LEAP Spread filled at the correct price this morning, however the front month premium is lower on both put and call sides. Are we still looking to enter at the same levels please?
     


  25.   Hey Phil… I sold half my AIG calls… letting the other half ride a little longer…. just in case it goes crazy up and up

     
    yeeeeeeehawwwwww     http://timelineonev83.blogspot.com/


  26. Is the new $100K port going to be here or on that other stock site you mentioned?


  27. eph – t’will be at the new site.  Tech issues for now. 


  28. Phil / 100KP:  Phil, I love the idea and strategy behind the new portfolio. I’m in for one round of the AIG trade already, and can see the fantastic value of having these calandar covers to write premium on as even the big AIG pump has barely put me into net loss on this position. But wondering if you had a clean slate at AIG $41, what would you put on for a second round trade? Cheers


  29. BA is such a pain in the ass.  Too hard to play with leaps. 


  30. CCJ  Any short term opinions?   I’m long 4 Jan 25s and 2 Sep 24 and short 6 Sep 28s and up.   If we’re looking at a pullback, I’m willing to sell my Sept longs and be overcovered for the rest of the month hoping they all expire.  Waddayathink, too risky?


  31. CCJ   I’d still have positive delta after selling the Sep calls, so I wouldn’t be that bad off on a rebound.


  32. Phil,
    Would you mind giving a brief summary of your criteria for holding v. breaking levels?
    Also, what are your general thoughts about the GS Conviction List as a tool for strategizing?
     
    Thanks.


  33. Phil

    I need help with WFR I boy 5 Jan 10 14′s for an average cost of $4.50 but the price keeps falling and I know I’m not understanding the original spread I had – selling the 17.50′s which I have noticed keeps falling too.

    Now I just have the 14′s

    Can I fix this trade somehow?


  34. Woaa…algo malfuntion?  That’s odd for an intra-day.


  35. BEAT has a pullback here to 7.6/7.7 area.  If you missed it yesterday, this is where I bought in.  If it pulls back harder, it will fall to the 6.50s.  They had a nice earnings  beat, but it is volitile.  They could be a takeover target for yours truly, GE, or others.  One can sell the 7.5 Sept09 P after things settle down for a nice entry, or sell the straddle w/ the stock. As I noted yesterday, they have some large gaps to fill if they head higher.  Currently I have the 5 Feb09s covered now with the 10 Sept09….if it moves through 7.50, I may roll those down to a 1/2 cover and then sell the Puts.


  36. DELL/Merk – I don’t think they are makig good margins and I think they are getting killed in the high-margin sales by AAPL and HPQ so I wouldn’t go long on them.  From a chart standpoint, they look good but so does the whole market, which I think is total BS so enter at your own risk!

    Stirred up/Pharm – Yes, it started when I woke up around midnight all motivated to analyze the GDP components and make a prediction last night and I got distracted by people who thought I should spend more time working.  Then, when I got back up around 6 I got into my research and turned much more bearish and that article attacking Roubini was the absolute last straw for me.  I am just so amazingly sick of this BS but, until the market actually drops – both me and Roubini look crazy and Cramer looks like a genius – it’s a cruel world!

    Politics/Pstas – I reserve the right to say whatever I want in my morning post as you may in yours – just keep it out of the comment section.  If you feel you will be irreperably harmed by reading any negative sentiment aimed towards the GOP, then arrange for a homeless person to pre-read the articles for you and delete all offending material.  You shouldn’t have any trouble finding one as the national foreclosure rate is nearing 10% but I will promise, in comments, to keep pretending it was nobody’s fault and had nothing to do with any irresponsible policies and I will refrain from saying anything that may cast doubts upon whatever Rush and Hennity have already enlightened you with. 

    $100KP – SS.  I haven’t looked yet but I expect we have a chance if the Dow breaks the fabulous 9,480 mark. 

    Speaking of which – Same levels as yesterday:  Dow 9,400, S&P 1,010, Nasdaq 2,000, NYSE 6,600 and Russell 575 – anything over those and we are still in a bullish trend but below those and we should get our move down to 9,100 et al.

    Check out FXP (yesterday’s Alert bull play), they are looking like BA and AIG this morning!  $9s haven’t moved much and should be stopped out at $1.75 once they cross $2 (.25 trailing stop)

    RUT down to 575 already, SOX fell below 300, Nas kissing 2,000 (QQQQ 40).  OIH dropping nicely with oil just testing $70 and XLE just broke below $52.50 so lots of growling from the bear cave but volume at 10am is just 25M so very easy to put the brakes on and reverse this. 

    Watch oil to bounce off $70 and gold (now $944) to break back over $945 and, of course, the Dow to bounce off 9,480 and those will be the signs to take the bearish profits but I think this time we may be actually breaking down a little lower as 416 banks are now listed by the FDIC as "problems," an all-time high!


  37. RE: 100K
    Phil, yesterday you posted how you had filled parts of the 100K trades by entering the trades for each option individually, not as combined spread orders (i.e., orders for 4 different CROX options for a combined debit of 2.35). I know you wrote that we should wait and see what happens for a while longer but does it makes sense to begin trying to get fills on some of the individual legs as you did?
    By the way, sorry for the misunderstanding regarding your service.  I was just suggesting some tweaking on the edges, not major changes, and I completely understand why you would not want to do any of that.


  38. DPO- I got some of this in the $6′s back in March when the world was ending. I like the sweet monthly payout and would like your thoughts on this. It looks to be over valued right now vs. the index. No options. Any way to hedge this with some type of index put/call arrangement?


  39. I’m out of TZA, that worked pretty well. 10%


  40.  Hey Phil,
     
    GOOG testing that 461 support area… can it hold?
    If it does, then that should be tell of more upside to come. I did a DD on my call position.


  41. chaps: for UNG 1/2 cover with sep 12 gives just 40 cents.


  42. DIA Mattress – Phil do we have stops on the 1/2 cover?


  43. Phil – predict big Daddy, teach us B)


  44. CROX trade in $100KP: Phil can you clarify how this will work around Sept expiration?
    The trade is buy March $4 call and $5 put, sell Sept 6 call and 7 put.  Come Sept, both the call and the put can happen to be in the money.  What do we do then?  Roll both?  I can see pairing the March $4 with the Sept $6 call (a bull call spread) but the March $5 and Sept $7 puts are confusing to me.  Looks like a bear spread.  Is this the intention, to benefit if CROX moves away from the $6-7 range, where it is now?


  45. More work Phil? point to where we are going LOL B)


  46. FXP.  PD – thx for the September 9 calls.  I got in at $1.50 – u think we can get $1.80 today?  That’s my limit sell order at the moment. 


  47. Any thoughts floating out there about POT? (The ticker symbol)
    Testing 91, if it breaks below…next stop 85?


  48. FXP.  Oops.  Waited too long to post my comment and got passed by your "earlier" FXP post.  Thx. 


  49. AIG.  If I missed it elsewhere, plz just point.   If not, is there an adjustment of the $100K AIG play in the offing?  Thx. 


  50. $100KP/SS – No changes, we’re only doing exactly what I thought we would do but it’s taken a day longer than I thought. 

    UYG/Steve – I’m seeing the $6 calls at .15 and the $5 puts at .15 so pointless at the moment.  I would just wait because, if they drop further, the VIX should go higher and we’ll get better sells. 

    AIG/Merk – Nice play by the way!

    $100KP/Eph – The actual portfolio will be on Wall Street Survivor but the calls will all be made here.  I have simply had no reason to change anything since Monday’s comment as I don’t see any reason why I shouldn’t get most of my fills on this sell-off.  I am trying to run this portfolio as "idiot-proof" as possible so a retired person can, once a week, place a set of orders and be done with it.  That means, unless there is an emergency, there will not be a lot of changes.   Should WSS come through with the changes we’re working on, I will be putting up a more aggressive $100KP for all you action guys who like to fiddle with your trades every day.

    AIG/Never – I would look to press the puts and wait to see if it’s necessary to scale into the long side at this price.  On the whole, it’s so surreal that you are better off waiting for clarity unless it’s just play money so far.

    BA/Jo – NOW I would cover for sure!

    CCJ/Eph – Absolutely right, sell the Septs and buy more Jans IF they start heading up.  50 dma is $26.50 so watch that line for a bounce and the fall from $29.50 means a 5% rule bounce is $27.10 (20% retrace) so watch that line carefully.  If it starts forming upside resistance, they are probably heading lower. 

    Hold vs Break/Aclend – It would help if you expanded on that question as it’s a broad topic.  As to GS list, usually I sell into the excitement, they usually get a 2-3 day move out of a buy or sell and, for me, it’s a chance to look something over and see if I agree with them or if they are just pushing the markets around. 

    WFR/Red – I’m not clear – did you sell the Sept $17.50s or the Jan $17.50s?  Either way if you are naked now it doesn’t matter much does it (other than it affects your net basis).  If WFR holds $15.50 they are in good shape for a bounce but then must retake the 200 dma at $16.20.  Since you can sell the Jan $15s for $1.70 and $1.70 pays for you to roll to the Apr $12s, I’m not too worried just yet but don’t let that trade get too far away from you. 

    Notice we are holding that 9,480 line like it’s life or death.  Oil is holding $70 and gold is holding $945 so Mr. Stick is hard at work.  Now watch the upside breaks of 575 on the RUT and 300 on SOX and 2,000 on Nas and I still like selling the DIA $95 puts for $2 as a day trade using those points (and Dow 9,480) as the on/off switch, looking for a quick .25+ to the upside.

    SRS calls are, of course stopped out here as $12 was the best we expected but happy to reload yet again at $11.50 if they let us.


  51. 2:48AM.  Dude, if you’re gonna post at this ungodly hour, at least stick around for the fireworks.  I think I scared "Where" – but he/she has motivated me to contribute even less in the future while paying attention to the edge on my abrasiveness.  Yep.  I swear.  LOL.


  52. Level of FDIC fund down to $10.4 billion – lowest level since the S&L crisis. glug..glug…glug…


  53. Phil:
    with UNG, FAZ, ERY scratching at a "bottom", the thing to do is take only 1/2 covered calls on these , agree ?


  54. DIA- I am still in the Dec 96′s- still waiting for a fill on the roll ups.
    1/2 covered with Sept 95′s sold at $1.75. Looking at breaks above / below ? for taking off the covers?


  55. Phil FAQ.  Since I’ve absorbed one or two myself, I think one of the  "Newbie FAQs" should be the inevitable "misunderstanding beatdown" by our beloved guru (ok – like this "rally," I thought I better join the parade of suck ups rather than try to cross the street.)  Man (men, women, all of ya) – I’m not even going to waste another set of Ls and Os on this stuff.  I’m just an obnoxious s**t.  Take me as I am.   Back to work and trades. 


  56. Wow, Allen Stanford admitted to the hospital for a rapid heart beat? Stanford’s old CFO singing like a bird? Its going to be a GOOD day!!!


  57. Phil,
    I’ve got a great idea, instead of hiring the "trading assistant" and charging us the $1,200 annual,  you can fix up that spare bedroom and then you can auction off a package weekly or monthly to each of us so we could come and spend the week or month at "Phil’s Trading Boot Camp". 
    Phil……. I’m talking about a whole new revenue stream!!!!  
    A Typical day would be as such, the Boot Camp Boy or Girl (BCBorG) would have to sleep on the floor of the office (forget the spare bedroom)  wake up hourly and check the Asian and Europe Markets.  If something has gone awry (like an asian selloff) we would tap lightly on your bedroom door (so as to not wake up the family). 
    For those of us that are insomniacs we can prank call the 24 hr trading desks at Goldman Sucks, Morgan Stanley or the local hedge fund. 
    Then at 6:00 am sharp you send us out for a quick 5 miler around your neighborhood.  (Keep 911 on your autodialer for some of us). Of course we would be in full camo that somehow neatly displayed the PSW logo!
    Then after the quick and cheap trip to the emergency room (cause new healthcare rules are coming) we would be back in the office for the 8:30 am data releases.
    Next up is to start strategizing the days trades…….. I am sure your focus would be lazer sharp with one of us constant playing with that new electric stapler you just bought.  
    The BCBorG would of course get their own color to post with in the blog (Like Pharm, Peter or Matt).  And yes it would have be a variation of camo.
    And if we turn out to be just totally incompetent in the office, think about the cash you will save having us do your lawn chores!!
    Well I think you are getting my drift……..  I’ll let you run with this!


  58. Phil,
    I think the 7% rise in Boing is overdone – it was in $43s just last week. Can you suggest a near-term & mid-term bearish, and long-term bullish options play?
    Here is what I think about the price action on BA – it will go back to around 45-47 next week, stay there or move with S&P Mid-Sep-Nov and go higher into Dec/Jan (assuming S&P is within 10% of where it is today). What is a good options play with these assumptions?


  59. Phil – I have the original SKFs that I rolled up to the 29 Sept (in at 1.4).  I was thinking of rolling them out to 29 Oct and selling the Sept 30s to cover the costs.  Any other ideas?  I know you had another longer term play…. so maybe I should roll into that one?


  60. Phil: I have JCP stock short, base 30.29$,
    now I want to do a Covered PUT, sell a sep put ? Is this working, if I get put stock, the shorts are covered, and I keep the premium.


  61. Volume 38M at 10:30 – Super light!

    FDIC’s Bair: "Deteriorating loan quality is having the greatest impact on industry earnings as insured institutions continue to set aside reserves to cover loan losses. Of all the major earnings components, the amount that insured institutions added to their reserves for loan losses was, by far, the largest drag on industry earnings compared to a year ago."

    Nat gas 54Bcf build – that’s in-line but anything but a surprise draw is bad for them.   Oil struggling to hold $70 at the moment. 

    $100KP/Allen – I plan to review all legs this evening and will post changes, if any, tomorrow.  We need a break below 9,480 to fill the lower legs and, if we don’t get them this week we have no choice but to adjust our spreads.   As you can imagine that will take a serious amount of thinking – not something I am going to be calling on the fly as I don’t want to throw off the balance of the portflio or fail in our primary purpose, which is to generate our target income in a month that has already lost a week.   

    DPO/Pstas – "Back when the world was ending…" LOL, I like that.  The jury is still out on the world but I’d say DPO has run it’s course.  That dividend is rock solid and $2 a year on a $11 stock is great and with your basis it’s fantastic.  Why not short them?  You have nothing to lose as it’s break even with gains in your longs but, if they drop back to $9, you can cash the shorts and buy 20% more stock….

    TZA/JRW – Excellent call yesterday!

    The Fed may not need to spend the full $1.25B it pledged to buy mortgage-backed securities, Richmond Fed’s Lacker says this morning. Lacker warned the Fed may need to hike rates even while unemployment remains elevated, saying the Fed shouldn’t be held hostage to unemployment.

    No, why should the Fed worry about their mandate – that would just be silly….

    FDIC releases Q2 stats: ‘Problem banks‘ jumped to 416 from 305 in Q1, the highest in 15 years. Deposit insurance fund fell to $10.4B from $13B in Q1 (protecting more than $4.5T). Bank loan loss provisions rose to $66.9B from $60.8B. U.S. banking industry had a net loss of $3.7B from profit of $7.6B in Q1.

    OSK flying on the same army contract they jumped up on in July.  Possible short candidate in the making if they fail at $32.50

    GOOG/Merk – Can I now say ha-ha-ha ha-ha ha or is it too soon?  Damn, are you going to make me do the math again, I think I did it on Monday… I think I was targeting $405 if the market fails to hold up so just be careful on those long plays.  I’m done with the 1/2 $450 puts at $7 (up 27%) here and stop at $6 on rest (+10%) but I’ll probably add the $440 puts, now $4.20, if I can get them for $3.50 or less when/if GOOG fails at $465 on a bounce

    DIA/Bgbig – If we fail to take back our 4 watch levels then I think dropping to 1/4 cover is a good idea, I’d say if the Dow makes a new LOD (9,448) then it’s good to go 3/4 or all naked for the duration.


  62.  AIG just lifted over my 42.6 resistance line… which goes back to May 7, 2009
     
    If that 42.6 resistance line really breaks, then 50 is next resistance above that… I’m letting my greed ride


  63.  chuckle…. yup Phil… you called GOOG top perfectly at 474 back on Tuesdya’s comments… you really busted my chops !!!… LOL… you duh man
     
    I’m not giving up yet though… 461 support is still holding and I did a DD near that level on my 500 calls


  64.  Damn… AIG just going nutz !!!


  65. Phil, You, your site and what you provide the small investor is simply AWESOME!  I hope that a big reason for starting this site was due in part to your passion for investing and country. I could not imagine a better occupation than to teach others to fish, having a forum to provide what I consider clear and concise economic and political commentary and making some $$$$ as well. I am sure that making big bucks has its appeal but considering the passion you display for all of the above, to do anything else would no doubt create issues for that internal compass you adhere to. KEEP UP THE GOOD WORK!


  66. is 1020 your daughter who got the $5?


  67. Morx/$5 She does have a new tooth coming in, but no, just MY passion showing. ;)


  68.    RE: OSK      Be carefull shorting OSK. That could be a different Army contract!


  69. RYL.   Based on their pre-open report, I went ahead and bought sept 26 puts at $2.30 – lets see if I can sell them now at the $3 bid.  ZERO volume tho.  i haven’t checked broader impact, but has DHI taken its deserved hit yet?


  70. I obviously missed something ….. what is this bounce?


  71. C having a good day, which is saving the XLF around 14.50, which is keeping SKF down.  I like the spread of the SKF Oct $24s at $4.50, selling the Oct $27s for $3 for net $1.50 on the $3 spread.

    CROX/Jordan – Sure we roll both, we are just looking to pick up that .50 per month in premium, we don’t really care where it ends up but we sold the Sept puts and calls for $2 and anything between $6 and $7 means we make $1 and CROX has to go higher than $8 or lower than $5 for us to lose money.  That’s a $1 profit in one month on $3.65 laid out on the trade.  I don’t care about the March $4 to the Sept $6 or the March $5 to the Sept $7, they are just placeholders to cut down margin requirements and guard against a disasterous move in CROX (like we got in AIG this morning).  As long as I can sell a $1 spread for $2, which gives me a 20% swing in which I can still make .50, I’m going to stick with the trade.  Since we have the $4 call and $5 puts, we can only lose $2.65 of the $3.65 we laid out and if we manage to collect more than net $2.65 on our sales over 7 months, then we have a winner. 

    FXP/Dstill – Winner at $1.75, don’t be greedy as we are holding those levels.  I still like them long-term but why not make .25 5 times rather than trying to make $1 once?

    POT/Shane – I’m sorry I wasn’t shorter on Ags.  We got caught up with MOS (now $50.50) as the target but the others were much easier to pick on.  That whold sector should correct down with oil if they break down here but right now they are being defended at $70 very well (probably time for Rent-A-Rebel this weekend).

    AIG/Dstill – Painfully waiting for smoke to clear.  I only filled the bull leg so this sucks so far.  As to your "edge" I get the LOL but you are, I think, a fellow New Yorker where sarcasm is assumed and doesn’t actually need a sign around the text.  I used to travel around the country consulting and whenever I was on a trip to the midwest I would have to remind myself that, under no circumstances, was I to speak without thinking about where I was first.  That’s a problem on the web as it’s not just small regional differences that come into play but even serious cultural differences with a global audience.  We will offend each other from time to time but I think/hope that we have a level of intelligence here that exceeds that of the average Yahoo message board and that everyone can take the occasional comments in the spirit in which it was (or wasn’t) intended.  Heck, just this morning I let Nitro say that Al Gore would have tapped SS money as if that wasn’t an outrageous insult to everything the man stood for and without pointing out that every horrible, dangerous and ultimately disasterous thing that Al Gore was worried Bush would do came to pass durring his Presidency – water off a duck’s back as they say….

    FDIC/Chaps – I dispute that number.  I am fairly positive they are tapped out already.

    UNG/RMM – It’s a hurricane play so you are just playing daily roulette hoping for a winner.   FAZ I think fundamentally has room to go up and is the one I’d be most likely to hold naked (or the vertical I picked Monday) and ERY I would take the money and run at $17.50 assuming oil can hold $70.


  72. Somebody needs to email this to Kudlow
    FDIC releases Q2 stats: ‘Problem banks‘ jumped to 416 from 305 in Q1, the highest in 15 years. Deposit insurance fund fell to $10.4B from $13B in Q1 (protecting more than $4.5T). Bank loan loss provisions rose to $66.9B from $60.8B. U.S. banking industry had a net loss of $3.7B from profit of $7.6B in Q1.


  73. Phil – SKF, got it.  Thx.


  74. DPO- stock "not available to short". Besides, if I were to short this, am I liable for the dividend payout? Not sure how that would work?


  75. Phil – About the ags/fertilizer.  I’m selling some put’s here on IPI as I made good money on the last strangle I had on them.  I do not mind owning the company long term since they have several very good competitive advantages, even though with low cost natgas they are somewhat diminished.  Just heard a report on BBC about the worst droughts in India in the last 50 years, so we’ll have to see where issues like this push ags.
     
    I used to work for IPI and I think they will be a solid investment.


  76. Boink !!…. AIG bumped into 50 !!!


  77. Edge.  Wow.  I’m honored to be "adopted" as a New Yorker – born and raised in Denver tho.  Lived and worked everywhere.  DC last 15 years.  Since we DC-ers own NYC (or they us – who cares tho, right?), we get to use the sarcasm too.  And I tend to be a Gore Vidal-ista on the subject of Albert Gore.   But I gotta give the guy credit for helping create the newest/greatest ponzi/market scheme ever:  carbon offsets!  hahahaha.   (Plus I’ll never forgive him for letting 2000 get away by being a poor campaigner then surrounding himself by the likes of Warren Christopher when it became a UFC battle in Florida – oh well.  Versus Jim Baker?  Bambi meets Godzilla for sure.)


  78. Frustrating (for us bears) how the lows of the day are easily defeated on such low volume.


  79. Looks  like another low volume grind up.


  80. phil - on DPO,you recommend to PSTAS  shorting the stock. Wouldn’t he then be liable for the dividend on the short stock?
    dflam  


  81. AIG.   I got all legs filled.  And the #s are still freakin’ me out a bit.   I’m not on the ledge tho – just yell at me: "Do NOT start unwinding legs willy-nilly right now, man!"


  82. DIA/Pstas – There is no way you should not be able to roll to the $97 puts for .50, tell your broker they suck if they can’t fill that roll.  Sometimes it’s better to just offer $1 for the roll up $2 and the bid ask of the $98 puts are exactly $1 apart from the $97s and there are plenty of sales going by that would fit the ($1 spread).  On the Sept $95s, if we don’t get a stick back to 9,550ish then I think we can uncover for tomorrow as Asia may take a dive into the weekend.  

    LOL Chuck – My girls are always thrilled to have a house-guest and there’s nothing Tina and I like better than a free baby-sitter so come on over!

    BA/M2 – Well this may be a bit overdone but the upgrade police may come tomorrow or over the weekend.  If you want to go short, I’d go with a backspread to cover your ass and take advantage of the run-up like selling the Oct $50s for $3.70 and buying the Feb $55s for $3.45.  If BA fails to hold $50, you should retain at least $1.50 for a very nice profit and if they turn out to be going higher, you can add a few and just roll them up to try again at the next srike in Nov, Dec and Jan.

    SKF/Pharm – I like the 11:29 vertical for you too.  You are in for $1.40 and you spend $3.50 to roll to the Oct $24s ($4.90) and sell the $27s for $3 so net $1.90 on the $3 spread and you have a b/e at $25.90 – not a bad way to convert a .40 loss…  Just remember to do something financially bullish if the market breaks back up.

    JCP/RMM – This is another one that could turn ugly for you if the market breaks up.  You are already .50 behind and you can sell Oct $30 puts for $1.75 which "raises" your basis to $32.04 with a max gain of $2 (6%) over 2 months.  This is another one where I’d rather do a backspread of the Jan $32.50 calls at $2.65, selling the Oct $30 calls for $2.40 so you are in for .25 + $2.50 in margin and there is very little upside risk while a drop to $27 should still leave you with $1+ so figure you can buy 2 of these spreads for $2.75 cash and margin and you’ll make just as much money as covering your short with way less exposure.

    AIG $50 has to be shorted out of principle.  Selling naked $50 calls for $7, covering with Nove $60s, now $7.80 IF AIG breaks $50.50.


  83. AIG.  Or maybe I should just unwrap the whole thing (with a bit of a gain) and start over, PD?


  84. AIG Correction.   At these #s, it may be a modest loss.   I won’t reiterate the play legs here – I basically got ur reco’d prices/spreads tho.


  85. GOOG/Merk – Moment of truth at $465.

    Thanks 1020! 

    No Morx, 1020 is not my daughter, you can tell by the fact that he’s not poking his tongue through the new hole in his teeth all day long as my daughter is this morning…

    OSK/Silent – Just watching for now but they are acting more like they got a NASA contract than the Army, who usually take longer to pay for things…  I think this move is 50% merit and 50% squeeze so we’ll see.

    DHI/Dstill – they are really bouncy, came back from $13 fast.   HOV is up 2% so no help for SRS from that group.   CRE is down today though.

    Missed something/Chuck – Yes you did, check your inbox for the 10:38 Alert titled "Bouncy Here."   8-)


  86. Hey Phil… I got 55.8 as next resistance level … that lines goes back to Nov 10, 2008
     
    I’m trying to sell half my remaining AIG  call at a 9.5 ask…. letting the other half continue to ride just in case 50 resisatnce consolidates and breaks over
     
    Crazy fun day !!!


  87.  I gotcha Phil…. watching GOOG at 465… I’m still holding a bullish confidence… chuckle


  88. thoughts on spwra here?


  89. Merk.   Oh how I wish I were Merk today.  He’s having a fun day.   luv ya, Merk.


  90. xom 70 call/put still working.  Buy whichever is a dollar.   (assuming you are not in options exp week)


  91. Phil- Thinking of following Crox trade: Buy Mar $4 C at  $3 ,sell Oct. $7 call for $.60,buy Oct  $3 put for $.10 to get 12.5% ROI with full cover on downside. What do u think?
    dflam 


  92. AIG – any suggestions to play AIG if we cant sell naked calls?


  93. Just got in.  Sorry if this is already mentioned: MTXX back down to 5.35.  Time to sell puts again?


  94. Phil/tooth   What if I told you that the wife and I had a trailer park brawl last night over the last Old Milwaukee and I now have the same missing Chiclets to show for it….. ;)


  95. missing tooth also reminds me of the dentist character on "The Hangover"


  96. The U.S. commercial paper market expands by $43.7B to $1.154T – its third increase in four weeks, following a lengthy downturn from an August 2007 peak of $2.2T. The gain was led by gains in asset-backed paper of $41.5B. Nonfinancial unsecured paper tumbled by $10.2B.

    U.S. fund managers pared exposure to stocks and raised bond holdings in August, according to a Reuters poll this morning. "I think we’re all in agreement that the upside potential of these markets is limited compared to what it was back in the late spring (and) early summer," one market strategist said. Equity holdings fell to 64.1% from 64.9% in July.

    August KC Fed Mfg. Survey: Manufacturing activity eased slightly as firms continued to trim inventories, but expectations for future factory activity rebounded to levels not seen since last year. Headline production was -7%, down from +2% in July and +9% in June.

    Short selling in S&P 500 stocks remains below historical averages, but bearish bets are above average in the healthcare, industrial, financial and materials sectors, Jefferies says in a report this morning. Firm says insider buying remains ‘virtually nonexistent.’

    DPO/Pstas – Hmm, this is why I hate stocks with no options.   Well it isn’t worth .16 a month to lose another $2 so be careful below $11.

    GOOG/Merk – Hmm, having a spot of trouble at $464 are we?

    IPI/Where – Oh they are nice long-term plays and IPI is one of the more fairly priced ones.  Should have good support at the 200 dma at $23.

    DC/Dstill – Ah yes, same thing…

    Frustration/DB – The bears are just scared.  I think the term "teddy bears" was aptly coined last week to describe that side of the market which is appropriate after all the times the bears have been stuffed into the close…

    Dividend/Dfalm – Yes he would but it’s .16 and he’s collecting it on the other end so still a neutral position.   This is as an alternative to selling to ride out an inflection point, that’s all. 

    AIG/Dstill – Oh my gosh you have to get out now!!!!  No…. just kidding.   First of all, there’s a reason we took just a single contract in a $100K portfolio as this was our riskiest play.  2nd of all you should take out the puts for $1.50 leaving you with a net $9.20 loss on the $33 calls at $16.40 which can still be rolled to the Oct $45 or $50 puts and calls even at $18+.  As long as you have that roll to $18 of almost pure premium, then all you have lost so far is a month.  And C) (don’t you hate it when people do that?) the 2011 $30s are now $33 bucks, up $9 so it is ALL good…  4) You can take that $9 of virtual profit and spend it to roll the $30 puts to the $45 puts and LOCK IN $15 on the spread.  If you do that 3 times for $27 you lock in a $45 spread for net $51.40 – isn’t that brilliant?


  97. Frustrated Teddy bears/Phil – Well I’m definitely frustrated, not scared yet though. But todays action has helped me make my mind up. My subscription to PSW runs out tomorrow – I’ve been here continuously for 2 years now so I’m going to stop trading for 6 weeks and take a holiday. By October the market should have made its mind up and have started crashing. :-) My shorts are in place waiting. Don’t miss me too much though – because I’ll be back :-)


  98. BA
    Before you go too short …

    :
    Boeing investors world’s most efficient solar cell, Crain’s reports

    Researchers at Boeing (BA) have developed the world’s most efficient solar cell. The cell turns 41.6% of sunlight into energy, as compared to typical commercial photovoltaic cells that convert 14%-22% of sunlight into electricity. Boeing says the results have been verified by the U.S. Department of Energy’s National Renewable Energy Laboratory.


  99. AIG.  Cool.   Lemme decipher that and head over to ETrade for a few.  Warning:  Question may follow. 


  100.  LOL Phil… GOOG 464…. yup … it’s having a lil trouble there… but I’m stubborn bullish and I ain’t givin up yet   ;)


  101. Peter D – A just in case addition to your FAZ play yesterday is buying the Oct 23/22 put vertical for .60 and selling the Oct 48 call for .60.  This would pay off if the market stays up and chops FAZ down.


  102. AIG/Merk – You tend to get a littl bull crazy on momentum don’t you?

    SPWRA/Jo – I love them long-time!  Good entry here at $25.61, selling Oct $25 calls for $2.55 and Oct $23 puts for $1.35 for net $21.71/22.36,  Scale-in of course so you can be happy to DD at $18 if they crash rather than freaked out. 

    XOM/Jo – That is always a fun play when they get sticky at a strike. 

    CROX/Dfalm – I’m not understanding that full cover thing.  You are paying net $7 for CROX in March and selling the Oct $7 call for .60, that’s fine as you drop your net to $6.40 with a $7 call away but the Oct $3 put at .10 won’t pay you a penny until CROX drops below $3 and that’s probably going to drop your long call to below the price of the March $7s, which is $1.50.  TANSTAAFL my friend!

    AIG/Morx – Premiums are too ridiculous and the stock is too volatile.  I don’t mind selling premium but I would hate to buy it.  You could just do that spread I laid out as the emergency cover and assume you will retain some value if the caller expires worthless.

    Trailer park/Morx – Yep, that’s what my daughter told me too!  It’s amazing that she discovered a slight wiggle on Tuesday and last night, just before bed, she came out with a bloody hole in her mouth saying "it just fell out."   This is why I don’t give them $20s, they’d be paying the karate kids to knock them out…

    Best dentist song ever

    Holiday/DB – O hope you are right with your timing.  I think the holiday weekend may mark a turn. 

    Solar/Edro – That is very cool!


  103. Banks – Someone needs to take thebanks down a peg or two.


  104.  AIG Phil…. I’m playing the chart resistance… The half I sold first thing this morning at 3.2 was a huge profit so I’ve got alot of comfort and cushion to let things ride. I’ve already got more profit on the play than I had hoped for so I can step back and look at the chart without feeling any pressure.
     
    I’ve got an open day order to sell half my remaining contracts at 9.5 if this consolidation of 50 breaks over. If I get the fill on that order, then that will be absolutely great.
     
    The final 40 contracts I’m letting ride from "zero to infinity" until expiration day comes… I’ll just try not to even watch AIG anymore and see what I’ve on those remaining Septmber contracts during expiration week.


  105. Hasta, be back after hours….


  106. AIG.  OMG!   Amidst the 20 open windows, 2 cell phones, two lines, and … u all know the multi-tasking drill – a freaking light bulb just came on!  Wow!   I’m rolling to the 50s I think.   But I got all the math, man!  


  107. Phil, I have a different situation on AIG.  I got filled on the 33′s for net $11, but did not get filled on the 2011 Leaps.  Any suggestions?


  108. AIG!  hahahahahahahahahahahahaha.  I love these spreads, man!  


  109. DIA – Those $95 puts hit goal and should have been bought back!


  110. just happen to have a dentist poem in my inbox:
     
    Admission Requirements of U.S. and Canadian Dental Schools
    by Ron Koertge
     
    Is your furniture in mint condition?
    Has the loathing settled down?
    Do you have many commemorative coins?
    Do you know what the lighthouse stands for
    in poetry?
    Do you regard "uppers" and "lowers" as versions
    of the class struggle?
    If you could snow, would you?
    Could you wear a red hunting shirt rather than
    the traditional white smock?
    When someone murmurs, "But my first love
    is the oboe," are you disheartened?
    If you were a bird. what would be your wingspan?
    If someone said. his gums were clandestine, would
    you look forward to the drilling?
    Do you know what makes bipeds wild with joy?
    Could you be specific?

    "Admission Requirements of U.S. and Canadian Dental Schools" by Ron Koertge, from Making Love to Roget’s Wife: Poems New and Selected. © University of Arkansas Press, 1997.


  111. FAZ/where – You got it.  Good play, especially for the decaying nature of FAZ!


  112. Phil

    Sorry – had to leave discussion of WFR – back now

    Regarding what I wrote "I need help with WFR I bot 5 Jan 10 14’s for an average cost of $4.50 but the price keeps falling and I know I’m not understanding the original spread I had – selling the 17.50’s which I have noticed keeps falling too.

    Now I just have the 14’s"

    I am log the Jan 14′s and I was selling 17.50′s but because they kept falling in price I bot these back and now I am long the Jan 14′s which are still falling in price.
    I can sell the Jan 15′s which are now $2.55 and I believe you are telling me that the credit I get will allow me to roll the Jan 14′s to April 12.5′s

    Is that correct and if so does that mean I roll my current Jan 14′s by selling them and buying the April 12.5′s with the proceeds of the short sale of the Jan 15′s?

    Thanks
     


  113. Phil/Holiday – Look at todays action – A rest is needed from this bulls**t. S&P now $1 off the lows of the day. AGAIN


  114. Are the AIG adjustments for us all to do as part of $100kp please, or are they something more specific?


  115. Phil if we get late rally and GOOG breaks over 465 would you hold, it is trying.and how about FLR here?


  116. Phil/Past week- Its looking like (so far) no candlestick today on that SPX chart from yesterday, and the markets been finishing so flat. Am I still right to feel pretty confident that if we don’t break 9600 today we are, as you said, going to begin correcting?


  117. Phil, on UYG I have just the opposite of AIG.  That is I got filled on the Leaps, but not on the Sep 5put and 6call.  Is there some point before expiration that you take what you can get for the month?  Using your analogy, take what you can for the rent house for the month instead of letting it sit idle.


  118. AIG: and if it is for us all, the puts are now at abt $1.44; still take out?


  119. Phil: closed my DIA sep 95 puts, now naked,
    also partially closed my AAPL daytrade calls sep 165 with 15 % gain.


  120. jomama:
    re: xom 70 call/put still working.  Buy whichever is a dollar.   (assuming you are not in options exp week)
    If you would, how does this trade work? When do you sell? Thx.


  121. Jo/xom: Oh, I think I get it. The stock tends to hug $70, When it moves far enough away, you buy the cheaper option and cash out when it "regresses to the mean."


  122. SRS at $11.50. is this where you were buying the call?


  123.  GOOG 465… it’s game on…. and its Da Bears defense trying to stop Da Bullz offense from getting a 1st down !!
     
    Ball is on the 46 1/2 yard line, 4th down and a yard to go…. chuckle… can Da Bullz drive the ball get a new set of downs ???
     
    Ohhhhh and its a fullback handoff up the middle and he’s breaking through the front line !!!!


  124. Peter D/where : Question. Does the buying the Oct 23/22 FAZ put vertical for .60 and selling the Oct 48 call for .60 mean

    Buy the 23 put  / sell the 22 put or vice versa (Buy the 22 and sell the 23)?

    Also does the trade work if the 48 call is now selling for .45?

    Thanks


  125. Banks/DB – That ship sailed back in the 30s when they established the Fed and gave this country to the bankers. 

    AIG/Merk – Well $50s dropped to $5.40 already and that’s the way I like these plays, quick and easy then move on to something else that’s obvious

    AIG/Dstill – I believe you are supposed to shout "Eureka!"  Just make sure you don’t think this applies to any old thing.  What I liked about AIG was the psychotic premium of the front-months that dwarfed the long premiums.  As I mention to SS in the next comment, that same trade is now less attractive as the premiums on the leaps shot up by about a third.

    AIG/SS – Ouch!  That was the worst way to fill.  Same deal really, you should take out the puts and hold the naked calls and one day you’ll roll them to a lot of Oct premium.  You can cover at any time, no big deal except the recent move made the longs more expensive so maybe better to wait and hope they calm down a bit. 

    Poetry/Morx – Hmm, perhaps my next ban….  8-)

    Volume still low.  Just 80M in 4 hours so Mr. Stick is having his way with us.

    WFR/Red -  With the SOX back over 300 you can wait on a bounce at the moment but watch that line.  They did hold my $15.50 target anyway but watch $16.20 which, if it fails, is where you may want to sell those $15s first and then roll.  The order isn’t that important, it’s just a little momentum trading while moving around but the main idea is that the Sale of the Jan $15s pays for you to roll to the Apr $12s.  That spread may not seem sexy to you but it moves you out of premium, which is killing you and gives you room to breath while selling premium in Jan that still has room to roll.

    BS/DB – Yes but today’s low was 200 points below Tuesday’s high – don’t tell me that’s not an environment for making some money.  Being a bear requires far more patience than being a bull – it’s kind of like being one of those trap-door spiders that has to wait and wait and wait and wait and then has to strike at the exact moment something passes or it’s too late.  Much easier to be a bull and you are considered much more fun at parties and you don’t piss everyone off when you are celebrating your market wins on days they got taken to the cleaners.

    AIG/Steve – As I’ve said, I’m not making adjustments in the $100KP as it’s supposed to be hands off but that doesn’t mean there aren’t good adjustments to make and that one (that I was talking to Dstill about) is a very good one to make if you are of a mindset to do so and if you are fully in the position, which my $100KP is not as it didn’t fill.

    GOOG/B1 – I’m on plan from before all out on the $6 trigger on the $550 puts and in for $3.50 on the $440 puts, which I’m willing to roll and DD as long as the Dow doesn’t break back over 9,600 and the Nas and S&P don’t break new highs.  FLR I don’t like even though oil has been ramped back up to $71.70 from that $70 bounce already. 

    Correcting/Skasiah – Well we may have to put that thought on hold on this 100-point Dow rally off the bottom but this move looks like the stick of the day so wherever we top out on this run should be the day’s high.

    UYG/SS – You shouldn’t worry about the leaps, they are not important.  In about 12 months they become important but, for now, they are simply backstops for the trade. The goal is to sell premium so when you can get .25+ for the $6 calls, that’s good.  There’s no point in selling the $5s – if UYG breaks $6, you can sell $6 puts to cover the calls that will be getting in the money.  If UYG heads down, you may get your price for the $5 puts. 

    AIG/Morx – Yes, absolutely buy back the $33 puts.  They have nothing left to give you as they are not likely to lose more than .75 even if AIG hits $60 so they are pointless protection and you may want to sell $50 puts if they keep going up

    DIA/RMM – Yeah, I hope we don’t regret that.  No wonder the bears are so scared…

    SRS/Morx – Yep, $11.50 has been holding like a champ and this is what I expected earlier when I dumped the $9s, now back to $2.6, which is pretty much no premium and a buy again.


  126. chaps – you got it. xom tends to dance around 70 according to the cuurent market sentiment. 70 puts went from 1 to 1.36 just today. you can call it scalping etc – i call it $$


  127. red/FAZ – buy 23 sell 22.  And the bid/ask spread for the 48 call is .45/.75 so I used the midpoint.  Pretty good chance you’ll get it if you are patient.


  128. I’m calling shenanigans on this rally as the dollar was smacked 1% in on hour (and into the NYMEX close) and that has provided this market boost since 1:30.  Between that and a 5% turnaround in CRE since the open on no news at all, I have to think this is pure and utter BS.

    At $1.15, I like the DIA $94 puts for the weekend.  It’s going to be a gut check if we break 9,600 but, right now, I feel it’s worth a shot as a short play.


  129. DB / Banks / Bloomberg:  I’m kind of on the fence about the whole FOIA request by Bloomberg.  On one hand, I’m all for disclosure and especially when it comes to taxpayer money.  On the other hand, it could very quickly spiral into a run on those banks borrowing the most and then the taxpayer would be back handing out even more money.  So, maybe prudence has to outweigh my insatiable curiousity to find out which banks are taking the money.. or quantified in more manageable way.. which ones aren’t.
     
    Have a good holiday!


  130. phil: at this market level, you want to cover with dia 94 ? what happened to the bear ?
    1/2 or full cover ?


  131.  AIG… I hear ya Phil…. I get the message and won’t mention AIG any more in your blog’s comments…
     
    I know there has been a lot of damage and pain on the bear side of the trade


  132. Phil: forget my 2:26.


  133. Keep in mind today’s action is coming off a 30% beat in GDP and lower than expected unemployment.  What will it take to get the next 30 points?

    ERY Oct $17.50s at $1.80 are risky but fun.  If oil breaks $72.50 tomorow, they can be coverd with Sept $18s, now .85 and that’s enough to roll down to the Oct $15s, which would be oil over $75.

    DIA/RMM – I’m pretty sure this was an early stick save aimed at getting oil off the floor.  The dollar is getting crushed, the Pound Euro and Yen are going straight vertical against it and all the markets can do is dribble back below the highs?  Nope, I can’t get behind this. 


  134. Phil- would you initate a position on Citigroup? John Paulson has been buying, though not sure if he’s in it simply because he was in the preferreds and arbitraged the conversion to common. Trying not overthink it,but on announcement of his ownership in BAC, stock moved for a few days. thoughts on buying stock here and selling Dec 5 calls/puts for about $1.6? Is there a better play?


  135. Jo:
    Thanks. COP has been in a similar pattern around $44 for about 2 months, and options are available at $1 increments.


  136.  Phil, you’re saying buy the srs sept $9 call?


  137. Phil,
     I see the dollar getting whacked.  Is the dollar a market that can manipulated?  Just curious?


  138. Its been buying all the way for the last 90minutes


  139. Phil, off topic but wanted to make a comment regarding political posts, as they’ve come up again today.  I actually came across your site several years ago, probably 2 years ago, at the seekingalpha site.  I followed you for a while and thought your insight was second to no one else’s, but finally quit because I found all of your political comments to be a distraction.  I still find them to be a distraction, as well as those posted by others.  I only recently came back to your site, making the decision to try and skip the politics, if possible, and to focus on the meat – the trades and the recommendations. 
     
    I hope to be a long term subscriber, but you’ve already lost 2 years worth of income from me, as well as a friend of mine that will subscribe to anyone!  I suspect at some point, rather then continuing to be a long term subscriber as I had hoped to be, I’ll take the knowledge I’ve gained and go happily elsewhere.  I’m not very political, and only want to focus on finances.  I have no objections to anyone saying how the government’s policies cause an impact to the financials, only when people start going after individuals or party affiliation within the government.   I can certainly find all the political discussion on the web.  I typically read the NYT, the WashingtonPost, Drudge, CNN, Breitbart, politico, huffington, every day, so I do see and enjoy a broad spectrum in seeking insight.  I don’t know of any successful company that feels it’s smart for their business  to insult 1/2 of their customers…..
     
    So it’s your site, and I respect that, and I’ll continue to subscribe for the time being.  It has, however, impacted your earnings from me in the past for at least two (2) years, as well as in the future if it doesn’t change (you and everyone else), and certainly has kept me from recommending it to anyone.  If it’s cost you 2 years of income from me, and I’m pretty laid back, I wonder how much it’s cost you across the board?
     
    Anyway, happy to be here for now, learning what’s worth learning and trying to ignore the rest ;-)


  140. AIG/Merk – I don’t mind if you mention it.  I like having another set of eyes on the trade, even if you are on the wrong side.  8-)

    Interesting, now CNBC touting nat gas as the new substitute fuel.  We know they are up T Boone’s ass and he’s all about nat gas so PERHAPS "THEY" are dumping the price of nat gas in order to get government programs put in place to utilize it and then, once we are depending on it for more of our fuel – they will suddenly tell us there is a huge shortage.  That’s how they got people in the northeast to switch from oil to gas heat.  For a couple of years they jacked up the HO prices (just buy it at the NYMEX and roll it along, creating a false demand) while artificailly depressing nat gas prices.  At the same time they ran a huge ad campaign and offered deals that got over 90% of the homes to switch over to gas and within a year of ending the program, nat gas prices doubled and all the people who stuck with their oil heaters were laughing their asses off. 

    Wow, look at this thing go.  This should be it, back near 9,600 and the dollar is at $1.44 to the Euro (up 1.5 cents since 1:30) and $1.63 to the Pound (up 1.5 cents) but now they messed up and dropped the dollar to 93.2 Yen, which is going to make Japan angry.  This is when the game gets interesting, when the Western manipulators cross the line that the Eastern Manipulators are defending…

    C/SNS – C is in a sweet spot at $5 and you can buy it here and sell the Oct $5 puts and calls for $1.10 for net $4/4.50, which is not a bad entry.  I also like the 2011 $5s for $1.65, selling the 2011 $7.50s for .95 which is .70 for the $2.50 spread.  That’s just a trade you have to ignore for a year.


  141. Phil:
    here is interesting news:
    Like to rant online ? Watch for lawsuits.
    Chatter might be personal, but tweets, blogs can be libelous,
    anything you say, tweet, blog or post can and will be used against you in the course of public discourse and that includes potential legal challenges.Well: many people blast out over the internet any rubbish, mostly false and non-factual.


  142.  chaps – xom 70 puts getting very close to 1$


  143. oldgoat – that’s what i understood and did for $2.55. I think they are even lower now.


  144. what happened to the dollar at 2pm


  145.  Thank morx…


  146. Jo: Thanks. I’ve got auto alerts set on both puts and calls.


  147. Phil: closed the other half of my AAPL calls with 20 % green.
     
    Flying to Kauai tomorrow am, until sep 8. ALOHA.


  148.  AIG Phil…. chuckle…. yeah…. the grass is pretty lush and green on my side right now… LOL


  149. AIG. Gotcha. I get the unique premiums. And I already locked in the original LEAPs. Fun.


  150.  Phil, what do think about tomorrow???


  151. Java/Politics While it’s none of my beeswax, How can you say you’re not political when you read and watch all that you do, every day. To me, this site provides extra value with Phil’s insite and commentary. Just for a moment, pretend you are taking a business/economics/investing type of college course that you pay for and Phil is our kick-ass instructor….


  152. alright, he’s not your daughter, he’s your wife! Right? :)


  153. AIG – fun and learning! If I can add up, and I roll to the OCT 45′s, and also roll to the Jan 11 45 Put, then if AIG is above $45 at Oct expiration then I have paid $15 for a $15 leap spread. Nice….


  154. Morx/Wife  No, I’m just part of THAT OTHER 50% of the subsribers that thinks they are getting a BARGAIN with all the lessons learned on this site….:)


  155. Next lesson, learning to add up rofl. I still like it.


  156. Lol 1020, Morx, one of you sure sounds like the other ones wife today. Not sure which is which :P


  157. Phil, I agree with your DIA puts over the weekend, but I think you will be able to get them cheaper tomorrow. My chart
    calls for a final flush out tomorrow; the fall starts Monday. J.R.


  158. Have I finally gotten an entry on SRS that won’t come and bite me in the ass?  Time will tell.


  159. Hey Phil, I recently started working at this awesome company called Palantir. You should check out their finance platform http://www.palantirfinance.com/. Given all the interesting analysis you do, I think you’ll love watching the 2 minute video on the home page. We’re getting lots of traction with a few of the big funds.


  160. Should be interesting to see if anyone wants to hold the AIG bag overnight.


  161. SRS/Oldgoat – Not a good play now that they blew $11.50.  This may be a blow-off spike down but not worth taking a chance as support at $11.50 is blown.

    Dollar/Chuck – Yes it can be manipulated, especially when Asia and Europe are sleeping (right about 1:30) as the trading is very thin because the US doesn’t get into currency trading the way the rest of the world does (becasue everyone uses our currency so we’ve never worried about it much). 

    Politics/Java – Well thanks —- I guess…  I don’t know, would you prefer it that I worded everything very carefully so as not to appear to have any political leanings even though there is a virtual certainty that my opinions influence my trading.  To me, it’s kind of a critical bit of information to know what someone I am listening to believes in.  I suppose by your logic that Larry Kudlow should get a reprimand as should Rush Limbaugh and others who dare to cross the "don’t ask, don’t tell" line in politics.  I’m not saying this to bust your chops but it does fascinate me that conservatives (not liberals becasue 99% of these financial guys are conservatives) find dissenting views offensive or distracting and seek to weed them out. 

    It’s funny because I told people here in November and again in March as conservatives were overwhelmingly bearish, that this was EXACTLY what happened when Clinton took office and they all acted like the world was ending and they didn’t invest and they didn’t believe in the internet or the tech boom and pretty much sat out the greatest stock market rally of all time.  That is why there are so many damn hippy millionaires today – because we belived in him and belived he could turn the country around and, when he did we were right on board BUYBUYBUYing ever silly .com company that had a cool name and many, many people went from middle class to upper middle class during that run but few of them were conservative Republicans, who all huddled around their radios listening to Limbaugh telling them how bad things really were – for 8 freakin’ years as the Dow went from 3,200 to 11,500 and the Nasdaq went from 600 to 5,000. 

    So I will do my best to fool people if you promise to bring your conservative friends over to my site because it’s all about selling out for money right?  Let me know when they come on and I’ll arrange a fireside chat about how Obama’s tax and spend policies are a good reason to buy AIG.  OK, that was busting your chops…  8-) 

    In all seriousness, I live here.  I spend most of my day’s on this site and talking to people here and it simply doesn’t make sense for me to go over to the chat room on Drudge and tell them what I think.  I do promise to try to be as nice as I can be but we can’t just keep our heads in the sand when there is no single bigger mover of the stock market than politics.  It’s almost as if you want to say "Don’t talk about p/e because many of us feel strongly that price to book is the only valid way to determine value and your p/e discussions are an unwelcome distraction which we find objectionable."  From the list of sites you enjoy, it’s obviously not politcal discussion you object to, just the conclusions I reach. 

    This morning I said that GB2 wrecked the economy by raiding SS in order to justify giving ridiculous tax breaks to the top 1% of this country that threw us $5Tn in debt, inflated multiple market bubbles and ultimately led to the destruction of the United States of America.  That all, it’s not something people don’t know already but look at all the ire it has raised over politics.  It’s funny because I’m just looking at cause and effect.  If Clinton had been such a massive dumb-ass I’d be pissed at him to but there’s that Nas 600 to 5,000 thing under his watch vs the S&P 1,500 to 666 thing under Bush but I will draw no conclusions from that as I’m sure it had nothing to do with his excellent Presidency.  See, I can do the neutral thing!

    Oh yes, stocks… 

    More of a birds-eye view at how financials are dominating trading – particularly as Citigroup (C +9.4%), Bank of America (BAC +0.7%), AIG (AIG +31.4%), Fannie Mae (FNM +3.8%) and Freddie Mac (FRE +9.4%) were responsible for 43% of NYSE volume Monday. If you want to run with the robots, be prepared to jump off.

    Nice overview of oil market.

    Toyota (TM) will close down California’s last auto plant in March after operating it well under capacity. The Fremont, Calif., plant employs 4,700 and was the site of a unique joint venture with GM in 1984, but the Pontiac Vibe was canceled, and Y/Y production of Toyota Corollas and Tacomas are down 25% and 83% there.

    The USDA says American farm profits will decline more than expected, falling 38% this year to $54B vs. an earlier forecast of $71.2B. While input costs for energy and feed are falling, product sales are falling faster, and swine flu and a dairy surplus aren’t helping.

    Sectors with hig percent of stocks above the 50-dma:

    Finlindu827

    Inftenrs827

     

    Condcons827

    Lawsuits/RMM – Have I mentioned that I was just kidding about GS controlling the universe?  Aloha, have a good trip!  8-)

    Dollar/Mbaisley – See above.  No reason at all for it, we even had a 7-year auction that went off well.

    Tomorrow/Oldgoat – Oh I think this was BS but it’s pretty clear that we are meant to finish the week at 9,550 on the Dow so I expect more of the same nonsense.

    1020/Morx – Not my wife but I am starting to like him better than her! 

    AIG/Steve – Very nice…


  162. all seriousness aside, i too am learning way more than my little brain can contain. and finally seem to be making some money, too. I enjoy the banter and even the political discussions since i am pretty apolitical and need a little input but i would like to see more poetry.
    maybe we need a religion section too.


  163. SRS – gee thanks. After i said all that nice stuff.  I just dbld dwn on my 12 put from a week ago.


  164.  Hey Phil… we consolidated AIG just below the 35 strike for 5 days from Aug 20th thru most of Aug 26th. It was a very 
     
    I’m counting today as day 1 of the mother of all AIG short squeezes. I think there is more to go on this… a whole lot more. If we can get a close above 50 by the end of the day, then I think we have a chance for a gap up open tomorrow above the next resistance level on my chart at 55.7.


  165. Phil:
    Where are you on mattress covers?


  166.  wow… look at DELL take off !!!


  167. Looks like AIG yesterday, where Hank today??


  168. 0
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    Phil:  Why are there so few strike prices for October (e.g. five for FCX)?  Thanks.


  169. Phil, I’m not a conservative.


  170. Precision targeting/JRW – Oh I’ll be happy to buy more tomorrow as long as we don’t make a new high.

    Palantir/Ajay – I’m not allowed to have that kind of stuff, I’m a hard-core data junkie.  If you sit me in front of a system like that you’ll have to feed me through a tube for a weekend… 

    SRS – NOW I like them again.

    AIG/Merk – I hope not as I double dipped.

    Mattress/Chaps – Naked DIA Dec $98 puts, now $6.35.


  171. What kind of earnigs release comes 2 min to the close?


  172. DELL – WTF?  Oh wait, they released early and it looks like a big beat at .24 – may be fun to short if it turns out to have caveats. 

    AIG/CDS – Hank says rumor he is taking over the company not true.

    FCX/Kazoo – I see more than 5 but sometimes when they first print an option it takes a while for the brokers to pick them up. 

    Conservative/Java – I thought that was strange from your reading list.  Well you are then, the first liberal that has ever complained about my politics so congratulations on your purity of purpose in simply keeping politics out of the stock markets.  Now, seriously, if you can put a stop to Larry Kudlow, I would promise not to say a word about politics for a whole year! 

    DELL/Thatway – The kind that people want to use to squeeze the hell out of the shorts. 

    It’s amazing, DELL was expected to have .23 and they had .24, which is about 20% below last year but shhhh…  I wouldn’t short them on a beat but I wouldn’t go long on any of these guys after that last Durable Goods report. 

    Well another exciting ride in the market (and when I say market, I mean of course C, BAC, FRE, FNM and AIG, who are 1/2 of all trades).


  173. Phil, I was wondering if Micheal Dell had talked to Hank today!!!


  174. Actually, think of the maginitude of this scam.  You think volume is low in "the markets" and that maybe it’s possible for GS et al, who already have been shown to be making over 40% of all trades on the NYSE to manipulate the market.  Now we find out that "the market" is only 60% of what it appears to be as C, BAC, FRE, FNM and AIG account for 40% of the market’s volume.  So if GS and Co are not concentrating their firepower on those financials and are trading them in a normal proportion to the market, then that means they are trading 66% of the remaining stock volume.  Think about that!

    3:59PM Dell beats by $0.01, beats on revs and gross margins (DELL) 23.11 +0.86 : Reports Q2 (Jul) earnings of $0.24 per share, $0.01 better than the First Call consensus of $0.23; revenues rose 3.4% year/year to $12.76 bln vs the $12.59 bln consensus. DELL reports Q2 gross margins of 18.7% vs. 17.7% consensus, 17.6% last quarter. In the third quarter, the company expects seasonal demand improvements from the Consumer and U.S. federal government businesses, but the quarter is also generally a period of slower demand from large commercial customers in the U.S. and Europe. Dell believes a refresh cycle in commercial accounts is more likely to occur in 2010, with IT spending improving first in the U.S. The company continues to see pressure in the form of component costs and areas of aggressive pricing in the near term, and continues to take actions to offset these items. The company will continue to focus on implementing cost improvements and strategic investments to improve operations for the long term.


  175. I am life long conservative.  (Not a fan of Bush.)  Phil, I may roll my eyes at some of your comments/political views, I still find it entertaining and of some value.  I can still learn from the other side.  So keep going and don’t change.  I do miss Cap speaking for my side once and a while. 
     
    So everyone relax.  The politics is fine by me.  I don’t want this place to become dry and boring.


  176. For what it is worth, and with all due respect to Javaben, Phil’s political commentary is one of the things I like about the site.  I think is well-reasoned, insightful, and respectful.  Even when Phil is arguing with people who post opposing views he does not go below the belt.  He tries to persuade, to reason and to marshal serious arguments. This takes a lot of effort and is the way political discourse should be conducted.   It is the opposite of the pandering, the manipulation and the demagoguery of commentators like Rush Limbaugh.  If both sides of the political spectrum in this country would operate at this level, we’d be a lot better off.


  177. Phil, Larry called, said you were an a**h***, but promised to retire tomorrow ;-)    Can’t say I particularly find your conclusions wrong, just seems to be rather strongly partisan, so I think it detracts from the site, and ultimately drives some people away thus costing you subscribers.  However, as I said, I do recognize it’s your site, I am learning from this site, and I continue to subscribe, just maybe not as long or as soon as otherwise.  Anyway, here I am going on and on and contributing to the noise!


  178. JohnC1/politics  Great comment!  


  179. Just got back home from Key West. Lots of road work along the way back to Palm Beach. I doubt any state spends more money on roads than Florida.

    DELL
     
    Dell earnings fall 23% as corporate sales weaken
    Thats whats going to kill them. Like i said they need to make some smart acquisitions, otherwise they are just a box maker in a crowded field. If they produce a nice looking smart phone with cool features, stock will move so i would be careful shorting them below 20.

    NOK got to get bullish on them long term, better run than Motorola


  180. Phil – Your political comments are thoughtful and fair.  Much of it does relate to the market, as with the discussion of Clinton’s programs vs Bush’s and the markets reaction.
    That may very well be where the markets going now.  Up, up, up.  They refuse to let it crash.  They know they will get voted out.


  181. kustomz – Come to IL.  The roads are always under construction.  With the introduction of Construction Zone speeding cameras ($375 1st offense/$1000 2nd), I suspect they have the incentive to never finish them!


  182. Our construction zones have 45 mph limit all the time, work or not.  Anyone else have such slow zones?


  183. Phil. checking in late. Wanted to learn from your comments on SRS.
     
    Noticed early SRS comments to consider if it dropped to 11.50 again and held. Then it dropped below and you cautioned since it broke support. Then you liked it just before closing. Is that because it basically held there and did not drop further? I am interested in getting in but would like to hear what was behind your thoughts….


  184. Phil, it’s precisely that you’re such a data junkie that I thought you’d love the analysis capabilities of Palantir Finance. Analysis that you have to throw over to a quant to model can now be done by you directly in a fraction of the time. Anyway, if you have some time, check out the Analysis Blog which has some samples of analysis done using Palantir. http://www.palantirfinance.com/analysis-blog/. This is not really a sales pitch…just sharing some really cool stuff that we’re working on that I think you will enjoy!


  185. Grant, no thanks lol. I drive fast due to my car being over powered :-)


  186. ajaytoo
    I took a look. I am a fan. PayPal alum do the coolest stuff.
    Anyway, two questions:
    What is the functionality in the context of fixed income analysis? (I work at a bond shop)
    Secondly, it would seem a Palantir is a tease for us lowly individuals…any hope of Palantire Lite?


  187.  Hey Phil…. I updated all my trades today if ya wanna see… I had a pretty good day… chuckle
     
    http://timelineonev83.blogspot.com/


  188. Thanks, Shane. I’m actually working more closely on the government/intelligence product. I believe the Finance product is still targeted to the bigger funds at the moment, so no Lite version for small shops. I believe there will be a hosted trial version coming out in the next few weeks that will allow people to play with the software over the web. Unfortunately, it’ll probably be limited to a small number of near real-time data sources. Dig around on the site some more and if it looks interesting and you guys want to explore more, let me know and I’ll see if the biz dev guys can meet with you.


  189. How to turn an albatross into a butterfly? Looks like LDK may have a use for its polysilicon manufacturing plant after all…
    http://www.scientificamerican.com/article.cfm?id=ban-on-scrap-polysilicon


  190. Banking and the Fed
    Go to minute 7:20 and watch, its a multi part show if you have the time its an interesting watch
    http://www.youtube.com/watch?v=UsQughbpXUY


  191. BEAT has a lawsuit now….WTF.  I don’t get it….That is the reason for the move back today.  Glad you all could hold things down long enough for me to sell my DIA puts making a little $$.


  192. RE: AIG in 100k
    Phil, I was away most of the day and when I came back I saw I was filled at 3:37pm on the original spread of AIG in the 100K for a 15.70 debit which was the target (this was with TOS). The short 33 puts were sold for 1.18. I read your adjustments from earlier in the day but they don’t really apply because of what I got filled at.  Any suggestions?


  193.  Gooooooood morning Phil & all,
     
    Gonna be some fun Friday trading today !!!  
     
    Phil, I updated the table showing my positions going into this morning’s trade… and my profit/loss percents if you want to see
     
    http://timelineonev83.blogspot.com/


  194. Wow, Merk…now we see why you were so chipper yesterday! Great calls!


  195. Morning all!
     
    Merk, glad to see you throwing up your trades!  I hope you get even more today…and looking at the futures, you just may.
     
    They are trying to open above the spike highs of 1037, and take a look at $DXY…they’ll stop at nothing to do it!  I wonder how much cursing is going on with all our trade partners?  Currency debasement 101.


  196. Merk, all I can saw is super congrats………envy comes to mind.


  197. Good morning!

    Pre-markets are on fire!  Nothing but V-shaped recoveries back to the week’s highs so this will be very exciting.

    Cap/Grant – He’s not gone, just on vaca.  I agree, no fun talking politics with people who agree with you, you don’t learn much that way.

    Thanks John! 

    Thanks for sticking it out Java, I’ll do my best.

    Highways/Kustomz – Cali blows Fla out of the water with $15.5Bn in spending (2006) vs $9Bn in Fla but Fla is 20% more spent per capita at $493 vs $426.  Alaska spends $1,925 per capita on highways, Wyoming is 2nd at $1,127 and, surprisingly, Delaware is 3rd at $1,059 but maybe it’s all the bridges.  DC spends $113 per person on highways.  About $30Bn was given to states for Highway Stimulus and that’s about 30% of what they spent in 2006 but I’m not sure if that means they’ll actually spend 30% more or it’s making up for other shortfalls…

    Thanks Rich!

    Illinois/Grant – Very in the middle at $420 per capita but that’s the upper end of total spending ($5.3Bn).  I’m not surprised NJ is ranked among the lowest with 0.8% of our income, our roads always need fixing. 

    SRS/Ocelli – Well I thought it was holding but no so sure looking at the futures.  I had a change of sentiment looking at WHY the markets were rising (the falling dollar) as that does nothing at all to help REITS and can, in fact, skyrocket interest rates. 

    Speaking of a falling dollar, still being knocked down the  morning with the pound adding another half a point and the Yen is a total joke as they ran it down to 94 again while the Nikkei was in session to keep those makets up and now it is rising again against the dollar to prop up the US markets.  I’ll talk about the Nikkei later which had a messed up session with a pre-market pump gapping them up 100, which was all lost by the afternoon and then stick-saved into the close to keep them up 60.  You can’t fight this stuff!

    Data/Ajay – No I don’t mean data/junkie like a cute term to say I’m interested in data, I mean data junkie like I am obsessive-compulsive with data and once I see one thing I check another and another and I will literally spend every waking hour sitting in front of a good data terminal digging for this and that.  So I do not, on the whole, seek to tempt myself with info terminals although your system does look like fun…

    Updates/Merk – Watch those ICE, that’s an ambitious target.  Gotta love the symbol on those DIA $97s!  AIG over $50 in futures. 

    AIG/Allen – If you got the net fill it doesn’t matter that the put was $1.18, it’s simply no longer useful.  Remind me later and we’ll look for an adjustment as it’s probably worth selling a higher put over the weekend. 


  198. This is getting aggravating- still did not get filled on the roll  up to the DIA Dec 98′s- offered 1 for 2.
    Also- took another stab at SRS late yesterday selling Sept 12 puts for 1.25. Looks to be getting hammered this AM.
    Got into the DIA Sept 94 puts @ $1.10- still looking for holding over til Monday?
    DIA mattress- still naked with Dec 96′s- any covers this AM or wait? What is the plan?


  199. Hello
    100KP / AIG / other eyes =
    I have been in some sort of vacation, still i am, just looking into markets a few minutes and leaving most trades in auto-pilot. Now I read all yesterday post and i would like to make a critic, hoping its a constructive one.
     
    On the 100k portfolio im some disappointed and im only in the LZB trade. Why? because when I start readind the 100kp portfolio ideas I saw "AIG" "C" "FAZ" "CROX" "UYG" among others.  You have explained very well those trades ideas and I’m not against them. There is a lot of good reasoning behind them and most of those trades are related with big option premiums. But I just don’t like the underlayings behind those options. 
     
    Maybe I’m too conservative or/and I do not have a extra 500k porfolio with a secure 6%  so I can play this bets. See, I feel that they can easy go into one side or other, as we see right now with AIG. I would love to be in Merk trade but only after i see what the stock have done, and because I dont have a crystal ball i have to be coherent and just stay away.
     
    Still the 100kp protfolio is a great idea (an income producer), I will only take proposed trades with names I like. Please do not be influenced by this comments. Just make your picks and I filter them.