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Monday Morning – Moody’s Makes More Negative Noises

Top ratings agency, Moody’s says the US & UK are "substantially" closer to losing their AAA credit ratings as the cost of servicing their debt rose

Under the ratings company’s so-called baseline scenario, the U.S. will spend more on debt service as a percentage of revenue this year than any other top-rated country except the U.K., and will be the biggest spender from 2011 to 2013, Moody’s said today in a report.  “We expect the situation to further deteriorate in terms of the key ratings metrics before they start stabilizing,” Cailleteau said. “This story is not going to stop at the end of the year. There is inertia in the deterioration of credit metrics.”

Under its adverse scenario, which assumes 0.5 percent lower growth each year, less fiscal adjustment and a stronger interest-rate shock, the U.S. will be paying about 15 percent of revenue in interest payments, more than the 14 percent limit that would lead to a downgrade to AA, Moody’s said.  Financing costs above 10 percent put countries outside of the AAA category into a so-called debt reversibility band, the size of which depends on the ability and willingness of nations to reduce their debt burden by raising taxes or reducing spending.

The U.S. has a 4 percentage-point band, while the U.K. has a 3 percentage-point band.  “Those economies have been caught in a crisis while they are highly leveraged,” Cailleteau said, referring to the level of private and public debt as a percentage of gross domestic product. “They have to make the required adjustment to stabilize markets without choking off growth.”  

So happy Monday to you!  The Pound is certainly not taking this news well and has plunged to $1.505 from $1.52 in early morning trading and the Euro has flopped back to $1.37 but we are still maintaining 90.7 to the Yen so it’s actually a strong dollar day so far.  Copper, which is one of our key indicators, has fallen back to $3.32 – which is great for our short plays on FCX and gold is hovering under the $1,110 line (the bullish line for gold) while silver, our tie-breaker, is just over the line at $17.  Oil has been skating along at $80.67 for the weekend and gasoline is still strong at $2.25 (go VLO!) with nat gas down at $4.34

Perhaps the US should be more like China, who were going to have a budget deficit of 3.5% of GDP – which is above their target 3% but China moved swiftly to fix the problem – BY CHANGING THEIR ACCOUNTING, which is BRILLIANT!  And why not, Greece did it, Spain does it even Italy and the Ukraine do it - let’s do it, let’s cook our books (with thanks to Cole Porter). 

It’s not clear why China’s finance ministry is so attached to the 3% target. China has no obligation to keep its deficits below that level, and many foreign economists have urged the government to run bigger deficits. China also does not face pressure from global financial markets to run tight government finances, as its enormous pool of domestic savings means it has little need to borrow from abroad. But China’s government has in the past frequently faced questions from investors and its own public over whether official data accurately represent the state of the world’s fastest-growing major economy.

I know I may have mentioned liking TBT at some point, we took up some aggressive long positions on Friday as they dipped back to $48 and I do like them at this price, even though our usual buy-in is $46.50 with an exit over $49.  Getting back to China – According the the WSJ, Google does look to be pulling out of the Chinese market as they are unable to resolve the censorship issue over there.  This will give BIDU a hell of a pop this morning (and a good short on that pop!) as Google has 36% of China’s search market and BIDU pretty much has the rest (58%) but don’t be surprised if you see MSFT playing kissy-face with China as they try to push Bing in the People’s Republic. 

Google’s closure of would leave the Internet in China—which has about 400 million users, more than any other country, and is adding about 250,000 more each day—almost entirely dominated by local companies.  That helps the Chinese government’s efforts to control information, because it can more easily control local companies, but it means foreign participation in one of the fastest-growing parts of China’s economy will be limited, and it leaves Chinese users increasingly isolated, unlike Americans who have 6 – count ‘em - 6 corporate sources of media to choose from!  

There is an excellent article by Ambrose Pritchard in the Telegraph about the dynamics of US and China’s economic posturing and it’s very interesting to read the British readers’ comments at the bottom.  Once you have that perspective THEN you can read about Wen Jaibao’s warning to Washington that U.S. efforts to boost its exports by weakening the dollar amounted to "a kind of trade protectionism."  Also on China, a great story in the LA Times profiling China’s "ghost airports" like Libo, a $57M airport that opened in 2007 and handled a grand total of 151 passengers last year. 

We’ve been montitoring ovebuilding in China for quite some time concerns that China and India will be slowing growth to curb runaway inflation took the Shanghai down 1.2% today, falling back below the 3,000 mark while the Hang Seng pulled back 0.6% but Bombay and the Nikkei held flat, waiting to see what the US would do with the news and boosted by a strong dollar.  Keep in mind the reason I liked US equites and the dollar for 2010 was because of the simple premise – "Sure we’re a mess, but have you seen the other guys?"  

EU finance ministers are meeting this week to see if they can put out the still-raging Greece fireEmployment is DROPPING across the Euro-Zone so the ministers know that whatever they ultimately do for Greece will very likely have to be done a dozen more times as the dominoes begin to tumble.  The problem with an economic turnaround that centers on revitalizing the top 10% is that the top 10% tend to have very clever ways to avoid paying taxes in addition to the legitimate write-offs many have (and this includes corporations) from losses during the crash.  That means the governments are pouring Trillions of stimulus dollars into the economy but the lack of jobs growth presents them with an ever-shrinking tax base even as the interest bills are coming due

As I mentioned in the weekend post, I am trying to get more bullish but, as evidenced by the newsflow we discussed in Member Chat over the weekend - I still can’t get there!  We’ll see what the pump monkeys can accomplish today – it’s a shame to be so close to Dow 10,700 and S&P 1,150 and not punch it up to new highs (and I charted how critical that would be this weekend).  We’ll see if oil can hold $80 and copper $3.20 and gold $1,100 but, if not, we lived by the commodity rally and we’ll die by the commodity rally as the only commodity we think is poised to rise from here is interest rates as risk rears it’s ugly head. 


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  1. Great newsletter, what is your short on fcx? do you see it going down to the 74 mark again?
    Thanks, Pete

  2. he shorted april 75 calls and sold a bear april 80/85 call spread

  3. well, at least i held off rolling my BSX Mar $7 call. small consolation. Does this seem to be an over reaction to you, Phil? I am tempted to buy some more to lower my basis.

  4.  Phil
    You asked for a reminder on SDS and DXD plays for this morning – thanks for your help!

  5. what happened with BSX?

  6. Phil:
    from last Wednesday:
    BIDU/Eric – Yep, eventually.  Given my general market bearishness and BIDU’s huge run, I’m kind of warming up to the puts.  You can go with the Apr $540 puts at $20.50 and sell the March $540 puts for $8.70 for net $11.80 and the March $540s can roll to the Apr $500s (now $8) if BIDU breaks down early and, if not, you can hopefully pick up more than $11.80 from the Apr $530 puts (now $16.50) and you have a FREE $10 bear put spread.
    BIDU is up around $574 this morning and the April $530 puts are now around $9.20. Would you roll up the Apr $540 puts? Or maybe just abandon the trade, not trying to fight the BIDU trend.

  7.  tchay – rumor that bsx may have to pull their icd (defibrillators) off of the market (i believe)

  8. Good morning,
    Lines today at IWM 67.62 and 67.82

  9. BSX appears to be a filiing issue with the FDA, not because of any ‘safety issues’.  I am moving to 5 Jan12s for 2.30c (1/4 position) JIC it moves a bit lower for a better entry.

  10. BIDU — hi Phil — a pop today from the news of GOOG — is it to early to roll my june short call 550 out and up, should I wait till next week or you think BIDU can go to 600 plus thx

  11. JRW, Thanks. Got on TZA right after your post.

  12. Good morning!

    Well this is going to be tricky as we have no unhedged upside plays so we’re not going to be liking anything green! 

    Of course over 10,600 we can play the DIA Apr $108 calls at .95 (now .98) but my heart isn’t in it.  Nothing is impressive until we see 52-week highs on all our indexes and that would be:

    Dow 10,767, S&P 1,153, Nasdaq 2,362, NYSE 7,471 and Russell 678.  Since the Dow has a LONG way to go to catch up (150 points), they make a good upside bet and keep in mind that below 10,600, we can sell March $105 calls (now $1.64) as momentum covers but strictly using that 10,600 line as an on/off switch.

    We had good Industrial Production numbers (up 0.1%) but slower than up 0.9% last months and utilization was also in-line at 72.7%.  The Empire State Survey came in at 22.9 vs 24 expected and 24.9 prior but the employment number was strangely way up at 12.35 vs 5.6 prior so that’s our green shoot of the day.  New order were also up at 25.4 vs 8.8 and prices doubled to 8.6 from 4.2.

    Long-Term TIC inflows, on the other hand, were appalling at $19.1Bn vs $47.5Bn expected and $63.3Bn last month!

    At 1pm we get the NAHB Housing Index and they usually spin it as positively as possible (National Association of Home Builders and WFC put out the report). 

    It’s a huge data week with lost of housing data, Import/Export Pricing and the Fed Rate Decision tomorrow.  PPI and CPI on Wednesday  and Leading Economic Indicators and the usually dreadful Philly Fed on Thursday so strap in for a wild one!

  13. JRW - do you think 67.49 is still support?  It has held so far today.

  14. So much for that.

  15. JRW, SS,  Guess 67.49 has given way.  Still looking to 67.33 and 67.18 or are those lines no longer good?

  16. Phil
    do you recommend to DD BSX here? or too dangerous?

  17. Man, /ES bouncing wildly. Check out the short BIDU position that blew up at 7:55.
    I’m hoping to get a nice pullback this week to enter some *small* swing long positions for a possible blow-off top in April. Otherwise mostly cash for me until reality sets in.

  18.  nice pop on wmt today.  I have 55 Leaps – gonna sell into the excitement (sell calls)

  19. Damn, I just realized today is March 15th and I wrote up that whole post without saying "Beware the Ides!"  I must be slipping! 

    FCX/Iprosper – Yeah I think $75 is a fair price with copper at $3.20 and gold at $1,100 – $80 is speculating a move up in both and I’m not seeing it sustaining. 

    BSX/Morx – I haven’t found out what kind of revenue hit this is but I think 15% is certainly a bit much but beware of the downgrade police who rush to slap on downgrades so they, like Cramer, can confuse people later by saying they called it right on the turn.  On the whole, this is a nice entry point for BSX as it’s always something with them but, since I expect an overall sell-off, today is not the time for a new entry but no reason to panic out either. 

    Disaster plays/Deano – Wow, very important!  My next comment!

    BIDU/Chaps – No way -this is great!  We can let the caller expire worthless and and roll up to the $580 puts at $21.50 (+$12).  Hopefully there will be a pullback and we can sell lower puts for $22 for a fairly free spread but I think this is an excellent opportunity to short BIDU.  If they break $600, you can cover by selling March $590 puts for $12.50 to cover but tight stops.

  20. JRW, SS,  Out of TZA.  I’ll take a quick dime on a Monday morning any day.

  21. ‘That blew up at 9:55′ I meant — need to change my clock AND adjust for EDT.

  22. one thinng i read re BSX said the ICD = 15% of their total sales, i.e. 5 million a day.

  23. I think the blew up was GS manupulation, since there’s no fair valuation with this stock under the current situation..
     I seriously thought GOOG would stay so I shorted BIDU JUN 520 calls, oh well…
    Phil, Please advise how to salvage this. Thanks!

  24. judah,
    Yes, 67.52 ( old 67.49) 67.33, 67.18, 66.99

  25. Hi Phil, I have bought WFR @$13. What months are good to sell calls &puts. thanks

  26. Disaster hedges:

    SDS June $29/33 bull call spread at $1.90.  That is a double if the S&P dips only slightly and should hold value well.  If the S&P breaks up to 1,200, that’s 4% and should send SDS down 8% to $30 and that would be a good spot to sell puts and roll the spread lower so a very nice, adjustable cover.

    EDZ is still a good idea and they are starting to trade.  The Apr $46/52 bull call spread at $2 is out of the money but an easy triple if we get our commodity sell-off and emerging markets pull back.  Note that you can sell the $42 puts for $2 to make this a "free" play as long as you are aware that this is a 3x ETF and you need to be willing to roll the putters down and out if EDZ heads south but nothing beats getting a free $6 when a trade like this works out!

    FAZ is always fun, especially if Greece boils over.  July $13/18 bull call spread is $1.60 for the $5 potential pay-off and there I certainly don’t mind also selling the $13 puts short at $1.60 (now $1.30) to cover.  Keep in mind – if you don’t get the $1.60 for the the $13 puts then you didn’t need the coverage…  Best thing about this play is we’re already $2 in the money!

  27. Phil,
    Thoughts on our USO Apr 38 puts (take the money and run?)

  28. Good Morning!  Phil, "ides" - Should I break out the bug spray?

  29. DBA/Phil  ?

  30.  Phil – what do you think about NKE ?

  31. Phil,
    Friday we broke the 10 day support trend line on the Russell, today, the 5 day line; you have more screens than I do, does this look like it’s starting to roll over to you ?

  32. Phil,
    Any opinion on SYNA or TECD?

  33. BSX/Tcha – I like a DD by selling puts (into the excitement) in these situations.  The May $7 puts can still be sold for .70, not a bad entry

    Good discipline Jo!

    BIDU/Balance – I’d sell the June $550 puts for $32 and use the money to roll the caller up to the June $590s – no sense gambling when you are that buried, just try to work off the debt by maxing his premium.  $500 is what I consider fair for BIDU WITH GOOG in China but with GOOG out, $550 is sustainable, maybe $650 over time but this move up is too early.

    WFR/Jossie – I’d go for the Apr $14 puts and calls at $1.50.  Why mess around?  It’s a huge ROI and you can roll to $1 incriments every month so just sell max premium every month. 

    USO/Humvee – If oil breaks back over $80, yes – Step 1) Take Money, Step 2) Run

    Ides/1020 – That wins today’s obscurity award!

    DBA/Stock – I still like them as a long-term inflation hedge but as a buy/write where you create your own dividend stream every month. 

    NKE/Hunter – In the weekend update I included NKE as one of the companies I’d be proud to leave my children when I die (ie. 40 years) but they are not a good entry here, up almost 20% since early Feb.  If they ever go on sale again, then for sure. 

    Roll/JRW – I really don’t know anymore.  Sometimes I think I must be nuts because I hear constantly on the TV how great things are and how well everyting is going but then I go to do some reading and I get all negative again.  Sure there’s some good news but soooooo much bad stuff under the surface.  Anyway, then I worry that that colors my view of the charts but certainly the RUT looks like it’s curling over but, of course, we’d xpect that as they did a 5% run off 650 so let’s say 682.50 was the 5% rule (not hit yet) and the pullback line (20% of the 32.5 run) is 6.5 so 676 is a critical line for them to cross or fail and then the 2.5% line is the real breakdown back at 666 again.  I just think it’s so fundamentally ridiculous that they will break 682.50 before the Dow catches up (10,700, 10,767) that I couldn’t bring myself to take any upside play on the RUT at this level. 

  34. MNKD/ Pharn   August 7.5 puts @ 1.50?

  35. JRW/rolling over,  I agree with you comment/question to Phil.  It does look like it’s starting to turn.  I’m hoping it makes a run up and we can get a nice long ride back on TZA.

  36. Phil: MDT up on clinical trial news,
    have stock, also have March 43 putters(1.12 to 0.1) and April 44 callers(1.14 to 2.25), any adjustments with this bullish signal ?

  37. Hello Phil
    I have sold SPWRA March 19 puts for 1.60 and are .22,
    should i roll it to april 19, 20, 0r 21 puts or just let it expier and wait for a dip ? the premiums are realy low

  38. Hi Phil, here are the cards I have left in my  TBT hand, how would you play it?
    bot 1000 TBT @ 48.30
    bot 10 Sept 50 Calls @ 3.75 now at  2.38
    bot  20 June 45 puts @ 1.15 now at .67
    thanks, phlit

  39. I’m not sure we’re rolling over, although we are very due for a pullback short term. The dollar is still pretty overbought. If it drops, that could fuel a further commodity and metals rally and get us over major resistance in the 1150-60 area on the SPX. When money is still chasing momentum stocks like BIDU, you have to respect the fact that funds are still willing to gamble and are not ready to raise cash.
    I think the only question is whether the global situation deteriorates so rapidly that it thwarts a blow-off break out. Left on its own, I think the market would break higher, and SPX 1200 or even 1230 would not be out of the question in the weeks ahead.

  40. SYNA, TECD/AC – Not to blow it off by they are stocks so I don’t like them right now.  Happy to look them over after hours or the weekend but neither is one I pay much attention to. 

    Sen. Chris Dodd will unveil a draft financial reform bill today that will, among other points, consolidate banking regulators, create a systemic risk council and place a new consumer watchdog agency in the Fed.

    Republicans think the financial reform bill Sen. Chris Dodd will unveil today is much better than the one introduced in November, but is still too far to the left. The bill is unlikely to garner any Republican support without amendments that will push it back to the middle.

    Financial firms are bracing themselves for regulatory reform legislation that may be much tougher than what was expected just a few weeks ago. Premarket: BAC -0.5%, C -0.8%, JPM -1%.

    Mark-to-market may be expanded to include assets such as loans, a move that would mean major changes for banks’ balance sheets. For JPMorgan (JPM), BofA (BAC), Citigroup (C) and Wells Fargo (WFC), the proposal could affect $2.8T of loans, or around 40% of their total assets. Smaller banks would see an even bigger impact.

    Once burned, twice shy; banks are still holding back credit from small businesses, restraining the country’s economic recovery in the process

    March Empire State Survey: Manufacturing 22.9 vs. 24 expected, 24.9 prior. Employment 12.35 vs. 5.6 prior. New orders 25.4 vs. 8.8 prior. Prices 8.6 vs. 4.2 prior.

    Feb. Industrial Production: +0.1%, in-line with expectations and vs. +0.9% prior. Capacity utilization 72.7% vs. 72.5% expected, 72.6% prior.

    Q4 eurozone employment: -0.2%, the sixth quarterly fall in a row, and -2% Y/Y. All sectors reported declines, except public services, health and education.

    Moody’s backpedals:  The triple-A credit ratings of the U.S., U.K, Germany and France are safe for now, says Moody’s, but their "’distance-to-downgrade’ has in all cases substantially diminished." Since the global rebound has largely bypassed the four, they face "an increasingly delicate balancing act" as they move to rein in government debt.  I wonder if Warren (major holder) had them "clarify" their position?

    Pepsico (PEP +0.3%) increases its annual dividend by 7%, and authorizes share repurchases up to $15B.

    Dead Co walking:  Blockbuster (BBI) puts its European arm up for sale to raise some cash. The movie rental chain values the division at around $76M, though that won’t go too far when you consider Blockbuster has over $1B in debt.

    The U.S. is in talks with seven other nations about possibly joining an expanded Trans Pacific Partnership pact. The trade deal could help move the U.S. closer to its goal of doubling exports in five years, and add momentum to stalled WTO negotiations.

    As Google (GOOG) prepares for an expected exit from the Chinese search market, Chinese authorities have warned Google’s major partners that they must adhere to local censorship laws even if Google does not.

    Pound bears are more prevalent than ever amid concern that the currency’s terrible start this year – down 6.9% so far – will continue as the U.K. budget deficit reaches Greek levels. Wagers on the pound weakening vs. the dollar outnumber futures that bet on a rise by eight times more than when George Soros made $1B betting against the currency in 1992.

    As Greece’s main sales tax rises to 21% from 19% today, increasing the cost of fuel and most consumer goods, European finance ministers are meeting to work on plans that will help push Greece past its debt crisis without requiring a bailout.

    Think about this last story.  I have been hearing all weekend on Fox how the Greek people are lazy and want their retirement blah, blah but imagine what those same Fox guys would say if the US wanted to raise sales tax 2%, not to mention the fact that it’s 19% already!  THAT’s why people are marching in the streets, not because they’re upset about raising the retirement age.  Who does a 10% rise in sales taxes affect the most?  Europeans aren’t as dumb as Americans, they take serious economics courses in grade school and they understand the difference between flat and progressive tax increases….

  41. MNKD/Stock – not really interested in playing with them. IF they get approval, you are golden, if not, you WILL OWN them at the basis will be much lower than 7.5….
    ISIS – starting to pay off.
    AMLN – YEAH…no new trials, volatility plummeted.  Calls are ITM, but down still.  May try to sell the front 22.5 Mar for 60c to pay down the costs a bit, as well as a few P.  Waiting and watching.
    MRK on the move, still like the bull call spread from last week.
    BSX – got in the  5 Jan12s for 2.35.  Nice LT hold on those and let things settle down a bit with them.

  42. Pharmboy
    Are you in SLXP? 
    Do you think they will jump to 35   ?

  43. Per u Phil bot VLO at 17.75, sld put and call and closed the total pos at a profit (sld VLO at 19.85)      So looking to reload, when and where? thanks. Phil

  44. yodi or anyone else following, I’m out of the last V short condors I sold last week for a gain of .90 (sold for 2.40). I only needed .55 on these to make my March V condors break even, so that trade finished with a small profit.
    Also out of my last AZO March condors for 3.10 (sold for 4.00).
    I bought back the SPG condors for a .20 loss last week, so they were the only loser. Basically done with the March condors with less-than-stellar but still nice profits (this is somewhat incredible given the uninterrupted run up we had).

  45. Does anyone know of a list of Chinese ADRs to short if the U.S. gets serious about import restrictions? Given what we’re seeing with the BIDU/GOOG action, there could be some massively profitable pair trades in there (albeit the other way round).

  46. Pstas/TBT
    I spent some time, over the weekend, digging into my research data relating to the probability of interest rate increases by the Fed. There is a strong concensus among the most experienced (and reliable) analysts that the short term rates will definitely see a conservative move upward early in the second half of the year. This surely will give a boost to TBT. They also predict the USD will strengthen simultaneously with this interest rate move, which will surely impact the EUR and JPY pairings on the FX trades. I do not see the eventual fall in the USD until very late in the year. Butler is predicting parity with the CAD by June, as the BOC will be raising rates by then, in his opinion.

  47. Europeans aren’t as dumb as Americans
    That depends on where you’re hanging out.  Been to many football matches there?  Some Euros make Americans look like Rhodes Scholars.

  48.  Eric,
    If you look at SOHU, SINA, CTRP, PWRD, NTES, LFT, those front running ADR/S, all derived revenues mainly from local markets. With the pressure on Chines currency, RMB, I’d be carefuly in shorting those…

  49. Phil,
    How’s the volume? From TOS NYSE Total olume ($TVOL) seems light even compared to last Thur, an up day. 

  50. phil, what do you think about nyx or ndaq puts – with Dodd’s reform announcement and threats on fees, these could go down short term?

  51. balance,

    Thanks I wouldn’t touch those in that case; you’d need major export dependency. This idea of mine is probably a bad one — I’m sure it’s lot hard than it looks and were things to go in a protectionist direction, the move would probably happen so fast we couldn’t get in.

  52. Hi EricL
    thanks for the message on V I am out as well just more or less even as I did miss the 2.70 position to buy. Pls advice of any new condor ventures you looking at thks

  53. Phil,
    Are we half-covered still? …even if you are expecting a sell-off?

  54. Phil, Is it worth swithing from the old EDZ April options to the new ones? I think you mentioned they would be lightly traded, and it does seem that the spread is getting larger.


  55. JRW, SS,  Thinking of taking a stab at TNA if it continues to show support here.

  56. Oil faling $79.50 – woo hoo!

    MKND/Stock:  MannKind (MNKD -11.5%) shares tumble after failing to win FDA approval to market its inhaled insulin drug, Afrezza, for people with diabetes. While the regulators didn’t cite any safety concerns, they did request updated safety data, the company said. (PR)

    MDT/RMM – No, it’s right on target and they aren’t going to beat a market sell-off.  May as well let the putter expire and wait for a pullback to sell more.  If they pop $45.50 and hold it, THEN you can look at selling $45 puts and rolling the caller higher. 

    SPWRA/Micro – Very nice!  I don’t look at put sales as "rolling" bets unless you are TRULY trying to buy some shares.  I’d wait for a pullback, especially with oil falling, to sell more puts but my target price is an entry at $19 so anything I can sell that does better than that for me always makes me happy.

    By the way – Wheeeeeee! 

    TBT/Phlit – What the hell kind of mix is that?  You risk $48,300 owning the stock and then you spend another $3,750 in pure premium on another bet they’ll go higher and, just in case you don’t lose money there you make sure you’ll lose something by spending $2,300 on June $45 puts that are also pur premium. You have totally reversed the whole, very successful buy/write strategy and invented the very, very dangerous buy/buy/buy strategy that absolutely KILLS you on a flatline and doesn’t help you much unless there is a SIGNIFICANT move down (in which case, why the hell did you buy $48K worth of the stock?) and requires at least a 5% move up just to get you even.  So, as to how would I play it – I would get out of it as soon as possible as it’s an accident waiting to happen and is, in fact, already happening isn’t it? 

    If you are going to own TBT and don’t want to own more than $48K worth then own 500 shares and sell the Jan $50 calls for $3.75 ($1,875) and the Jan $48 puts for $4 ($2,000) which makes your net basis $40.55/44.27 with a call away at $50 (up $4,725) in a nice, comfortable spread.  We’ve put up numerous ways to be more aggressive with them, especially the buy/writes as there is no real advantage to owning the stock and, generally, I prefer the Sept $44/50 bull call spread at $3.10, selling the $45 puts for $1.60 for a $1.50 entry on a $6 spread so you can make that same $4,725 by risking just $1,500 (10 contracts) and putting the rest of your $48,000 to much better use.

    BIDU/Eric – I agree with the general premise but I don’t think BIDU is being chased on momentum.  The GOOG news makes a genuine, major fundamental change in the company’s outlook so I wouldn’t view them the way I view AMZN or POT or SHLD right now.  If left on its own is a big if for the market because the World isn’t going to leave us alone and that TIC flow number was scary this morning and NO ONE is talking about it.  Import restrictions is an interesting idea to pursue too! 

    VLO/Phlit – Best way to re-enter VLO is to wait for an inventory report with a big build in gasoline and sell puts into the excitement.   As with everything else today – it’s a stock so I don’t like them for a new entry right now. 

    Football/Jcm – I agree with that, been to many a match but have you seen the WWF

    Volume on Dow at 11:30 is 60M – not very heavy. 

    NYX/Jo – I’m not sure what the effect will be.  I like NDAQ long-term and I like NYX but they got away from me so I’m not too keen on betting against them but your premise is good and NDAQ is off already so NYX is the catch-up play with the Apr $27 puts a cheap play at .41

    DIA Covers/AC – I think if they can’t take back 10,600 by the day’s end then naked is acceptable.  Below 10,550 it would be good to either stop out or roll down to 2x a lower strike.  I am still hoping for 10,400 this week!

  57. Phil,
    In the 100K conservative portfolio I still hold that April 15 Faz call (after buying back the short call); you were talking about a C spread as a hedge, is that the C spread mentioned on Friday or is there something else.  The way FAZ is acting today though, it’s encouraging.

  58. JRW – are you thinking we get another run to 10,600?

  59. More dollar strength again. /DX very persistent in holding the 80 line so far.

  60. March $105 calls dropped to $1.30 already!  That’s why it’s so great to sell those things when the trend reverses.  That’s a stop out here though as we are a little bounce and can always re-sell.

  61. Phil I forgot to mention the TBT hand were the remnants lifting legs and rollouts.  I just held onto the remnants too long having profited on the other parts and being GREEDY and tried to profit on the other side. Will not happen again…….Thanks

  62. EDZ/Tcha – It depends what you have.  Go by the expectation that you will only get, at expiration, exactly what is due to you in intrinsic value.  You can’t sell premium or roll as the spreads are too crazy.

    C/Humvee – I am waiting for C to be done pulling back, haven’t forgotten but reminding me is a good thing as there are many things I do forget!  This is looking good ($3.85) if the Dow can get back over 10,600. 

    Finally a TIC article:

    Foreign demand for long-term U.S. securities slowed down as China and Japan reduced positions. The Treasury’s International Capital report showed net purchases of $19.1B, down from December’s $63.3B. China’s been a net seller of Treasurys for three months, the longest stretch since 2007.

    This chart puts the need for financial regulatory reform in stark perspective. (via)

  63. WWF.  LOL.  Couldn’t agree with you more, of course the WWF audience is only a fraction of the football audience in Europe. 
    Let’s just not make the Euro’s into a bunch of enlightened geniuses.  They did, after all, commit civilizational suicide twice in the 20th century via WW1 &2.  The only reason they survived and created the welfare state they have today is because they spent no money on defense, relying instead on the defense umbrella provided by  the US.  Did you read the article in the Times about Greece?  Hairdresser think they should be able to retire early (at 50) due to "exposure" to chemicals.  Broadcast announcers due to exposure to germs in microphones.  That was a good one!  Anecdotal of course with all the caveats, but the bottom 90%  don’t work hard in Europe, and haven’t for a generation or more.  By now, they’ve forgotten how.   

  64. MNKD – thanks Phil.  Have been busy this morning…..oh, and that’s why I would not trade them!

  65. Strong gains in the dollar are putting pressure on crude, now down 2.2% to under $80. Oil companies are among today’s losers so far; heavy dollar volume in Exxon Mobil (XOM -1.1%), Petrobras (PBR -1.3%), Chevron (CVX -1.1%), ConocoPhillilps (COP -0.7%).

    TBT/Phlit – Well I feel much better knowing that… 

    Europeans/JCM – You should read Stiglitz’s big study re. how we should think about GDP.  The Europeans, in general, have made different choices as to what constitutes a good life than we have.  They value their time and their families above the pursuit of money at all societal costs.  While a certain amount of people (even whole countries where Greece is concerned) may see that as an excuse to skate by with a minimum of effort – I think Germany has a fantastic balance and I had always hoped their position as the de facto leader of the EU would spread their influence outward but maybe you are right and there is too much tendency to go the other way and the Germans are just the next rich relative to be tapped out by the poor cousins. 

    If BAC keeps heading down I might like them better than C! 

  66. ss
    66.99 is the next stop but I’m not comfortable shorting; it’s not that there are sellers, it’s just that there are no buyers……yet.  I think we will get a buy program but I won;t commit until I see it.

  67. I closed all TBT pos except for 10 Sept 50 calls I am long cause Iwas thinking abt selling the the June 50 calls for 1.21  what u think?

  68. Phil,
    I like the TBT play above but I already have the Jan 35/43 spread from earlier and Jun 47 and Sept 46 naked puts. So should I do 4 of those spreads and 3 put sales to have 5/5 balance?
    Also, I will re-read Mattress Play but for now if I’m showing about 40% loss on my June 107s and we only dip to 10,400 then I don’t BE on those. I’ve done some of the 104/105 put sales to offset (not sure how much though bcz IB sucks for tracking stuff like that). What would be the decision process for the 107s if we go to 10, 400? Thanks

  69. JRW, SS,  On TNA.

  70. SLXP/qc – not sure they get there.  It is very hard to tell what is baked in. Look at AMLN.  Up $2 from Friday, so are the traders beating the stock down to shake out the longs, or are they really gonna take it down?  The drug is approved (unlike ITMN), so it is a line extension.  Phil may have a better play, but the volatility is lower than most other companies going into FDA.  They should get approval. Tons of 25 Apr10 P moving.

  71. In TNA at $ 52.54

  72. I’m in also.

  73. yodi,
    Here’s an interesting one: SCHW short condors of long April 18p/20c, short the 19p/c for .80 credit against 1.00 margin (so .20 risk/cost). I’m trying to get a fill on just a few to start.
    This is a nickel and dime trade and so to be worthwhile we’d have to factor in commission costs. But the idea would be to get out with a .30 profit, if possible, which would include the .10 commissions and a 100% return on the .20 risk/cost. The stock has sold off hard and is near support so this position would be lightly bullish. I won’t accept much less than .80 credit; maybe .77. It kind of depends on the liquidity of the options whether I do anything.

  74. Gel- TBT- there was a Bloomberg article indicating the same thing.
    I just love watching that premium fade away on those short puts.

  75. JRW, SS, Judah
    IWM Daytrades
    I wondered which equity/option would give the highest profit per $5000 investment so I put together a table using a trade that entered long at 3:30 Friday closing at 4:00.  Values are from TOS.

    I used IWM, TNA and RUT and a call option of each. 
    I rounded the number of shares/contracts down to the lower whole number that can be purchased.
    Interestingly enough, if we want to maximize our profits we should be trading RUT options.
    Equity                       low at 3:30    per $5000 at 3:30    high at 4:00    difference    profit PER $5000
    IWM                                 $67.43                    74                          $67.75        $0.32                   $23.68
    DIW100320C67            $0.91                 5400                            $1.06        $0.15                 $810.00
    TNA                                 $53.42                     93                         $54.16        $0.74                   $68.82
    TIJ100329C54               $1.36                 3600                            $1.60        $0.24                $864.00
    RUT                              $673.82                       7                        $676.12        $2.30                 $16.10
    RUY100320C670          $8.05                  600                             $9.60         $1.55               $930.00
    I have been trading the IWM options which only have a couple of cents spread.  The TNA options have about a 0.20 spread and the RUT options have about a 0.40 spread.
    The volume on the RUT and IWM options is >3000, the TNA option volume was <100
    The volume on the IWM options is so high I can use market trades if I want.
    IWM and RUT options also trade to 4:15PM, another nice feature.

  76. JRW, SS, Judah
    IWM Daytrades
    I wondered which equity/option would give the highest profit per $5000 investment so I put together a table using a trade that entered long at 3:30 Friday closing at 4:00.  Values are from TOS.

    I used IWM, TNA and RUT and a call option of each. 
    I rounded the number of shares/contracts down to the lower whole number that can be purchased.
    Interestingly enough, if we want to maximize our profits we should be trading RUT options.
    Equity                       low at 3:30    per $5000 at 3:30    high at 4:00    difference    profit PER $5000
    IWM                                 $67.43                    74                          $67.75        $0.32                   $23.68
    DIW100320C67            $0.91                 5400                            $1.06        $0.15                 $810.00
    TNA                                 $53.42                     93                         $54.16        $0.74                   $68.82
    TIJ100329C54               $1.36                 3600                            $1.60        $0.24                $864.00
    RUT                              $673.82                       7                        $676.12        $2.30                 $16.10
    RUY100320C670          $8.05                  600                             $9.60         $1.55               $930.00
    I have been trading the IWM options which only have a couple of cents spread.  The TNA options have about a 0.20 spread and the RUT options have about a 0.40 spread.
    The volume on the RUT and IWM options is >3000, the TNA option volume was <100
    The volume on the IWM options is so high I can use market trades if I want.
    IWM and RUT options also trade to 4:15PM, another nice feature.

  77. Europeans- I have had this recurring dream where some Potentate or Poobah rings up the White House Hot line looking to order up a carrier battle group to shore up his regime and the call goes to voice mail " Sorry, we can’t take your call; We are busy tending to our own knitting; We’ll get back to you ASAP; In the meantime, call France. " 

  78. re EDZ $5 put we sold recently: i’m thinking, if it doesn’t change much by Fri, of letting it expire then selling the stock at abt a $2 loss. The premium at $2..50 should cover unless …
    What’s the better idea that i’m sure you have?

  79. EricL set up condor on SCHW working at .825 I am asking .85 see what gives thks

  80. edro,
    I saw that Friday and will give it more thought this week, nice work !!

  81. Edro,  Very interesting.  I’ve been watching the IWM options today as I’ve traded TZA and TNA.  I trade RUT options often enough when I play the short strangles and the spread can be really frustrating.  It looks like the volume and spread on TNA options doesn’t make them a good candidate either.  So, you think IWM options would be a more efficient way to go?

  82. TBT/Phlit – I still like the bull call spread better.  If you want to be aggressive and sell puts, you can roll to 2x the Sept spread with the sold $45 puts and unless TBT goes past $55, you make more money that way. 

    TBT/Ac – I wouldn’t worry about balance too much.  You have $6.50 out of $8 possible on the Jans so you "know" you have $1.50 coming to you unless there is a huge catastrophe so why not use the same spread I outlined above to add to your position.  That captures additional upside without messing around with a very well working play that still has almost 25% to give you.   On the DIAs – they are INSURANCE and you are supposed to lose money on them UNLESS we have a big sell-off.  If you bought the insurance but don’t have bullish plays that are doing great at 10,400 then it’s kind of like buying car insurance when you don’t have a car.  Selling front- month puts against the long puts is CRITICAL or this is a very, very expensive insurance policy.  Our goal is always to make .25-.50 whenever possible and usually we have a $5 entry on the long puts so 10-15 good sales over 3 months gets us near even.    You still have 2 months to get on track but read the linked article in the strategy section where, in the commment section, we discuss these plays in detail.

    France/Pstas – Surprisingly, the French have 800,000 people in the army but that includes 100,000 police and 400,000 reserves.  They actually have the 3rd largest military budget and are 3rd in nuclear weapons so be careful who you pick a fight with! 

  83. Pharmboy
    Hi,  BCRX  still holding stks at 10.67 now dow to 7.04 against this I sold the March straddle 7.5 c/p 1.13/2.12 now .13/.65  it looks like I am out of the caller but the putter has still a bit of life do not want more stks to be asigned what would you recommend roll the putter to june for a low credit or buy the putter back? depending on the value of the stk. thks

  84. Actually the French Nuclear Weapons are suicide weapons; the next time they get invaded they will blow themselves up…

  85. Guys,
    IWM is x2 or x3 to RUT?

  86. IWM = RUT2000

  87. tchayipov – IWM is 1x, TNA/TZA is 3x bull/bear

  88. tch
    IWM is the Russell, UWM is 2X, and TNA is 3X

  89. Phil: DIA creeping uo, like to sell some puts, which ones ?

  90. EDZ/Morx - Well EDZ is at (relatively) $4.78 so I’m not sure what $2 loss you are looking at on sold $5 puts.  Those puts, if we stay here, can be bought back for .22 on Friday and we’re still bearish on emerging markets with this commodity sell-off so no reason to do anything at the moment. 

    IWM/Tch – Those are not leveraged, they pretty much track the RUT at 1/10th it’s value.   And what they said!  8-)

    GOOG down 3.2%, that’s pulling the markets down a bit.  AAPL down 2% is 0.3% down in the whole Nas, which is down 0.72 so about 1/2 the Nas loss is AAPL. 

    Oops – Homebuilder Sentiment Index fell 2 points to 15 (positiive is 50).  Expectations are down 3 points so future outlook getting worse.

    The former CEO of The Park Avenue Bank (closed Friday by regulators) has been arrested and charged with fraud against the bank and FDIC, in one of the first publicly announced cases of fraud against bailout program TARP.

    Three lunchtime reads:
    1) The Fed and rates: The end of gradualism?
    2) Michael Lewis excerpt: Betting on the blind side
    3) CDS bans: Sovereign debt isn’t the biggest problem

    This is why C is dropping:  With the lockup on Citigroup (C -3%) expiring tomorrow, and with a swell of positivity around the bank lately, Geithner should already be selling the government’s stake, says Linus Wilson – who advises Treasury not to drop the ball on this again.

    Japan lifts its economic view of the country for the first time in eight months, but its monthly economic report sees the risk of prolonged deflation and warns the economy "remains in a difficult situation." (ETF: EWJ)

  91. thanx

  92. Judah-
    Whether to use IWM or RUT options may depend on your trading volume.  As JRW once pointed out the commissions on the RUT options are a lot cheaper if you trade a lot.
    Both are more efficient than trading TNA or TZA.

  93. Phil-
    What are you anticipating near term with C?  If the government does sell, does that show confidence in the company and thus boost the share price long term, but drive it down short term?  What do you think a good entry level would be?

  94. Anyone know what percentage of GOOGs earnings come from China? 

  95. Correction
    As Peter D once pointed out the commissions on RUT options are a lot cheaper than the commissions on IWM options if you trade a lot…

  96. hum,
    lol re French.  They have French rifles for sale also, only been dropped once

  97. BCRX/yodi – U R up on both and holding on…..OMG please tell me you remember the rules of PSW (maybe?).  Then sell 1/2 7.5/6 C/P straddle for 65c or so.  They have floor support at 6.4 and calls could be rolled up to June 10s even IF they take off.
    Back to today’s programming….

  98. so good that I kept AAPL and GOOG delta negative till today, now make them nutral

  99. Phil/AMZN Kindle and Colorado taxes.  I tried to buy Michael Lewis’s new book on my Kindle.  Not available.  I recall that when I bought my first Kindle over 2 years ago, Lewis was a big promoter of the device.  I guess it is his publisher, not Lewis who makes these decisions, and I don’t know if Penguin books will be available on the iPad, but this was the 4th book in the past few weeks that I tried to get for the Kindle and it wasn’t available.  I’m starting to see a lot of grumbling about this on message boards.  I expect AMZN will fix their problem with the publishers, but the combination of the pending iPad and the availability of books is going to show up in their results in the next couple of quarters IMO. 
    As for the tax fight with Colorado you mentioned last week, I guess they’ll eventually have to shut down their affiliate programs everywhere because the states are going to keep going after the revenue.  I don’t know what percent of AMZN’s profits are tied to the affiliate program, but this problem, too, isn’t going away for them any time soon.

  100. Wasn’t there a video on French Rockets???? Oh yeah, I forgot.  Still makes me LMAO.

  101. EDZ – i think if put to me i get 10 shares at $50 for each $5 contract and $2.50 for each .25 cents. Stock is trading now at abt $48 so if put to me at 50 and sold at 48 = 2 loss, no? (be gentle, i was an art major)

  102. JRW, judah – I am out of TNA, are you still in?

  103. Pharmboy
    Thank for reminding me closed the putter and will sell June strangle 10/7.5 c/p

  104. Pharmboy, love that rocket test  ROFL

  105. SS, Still watching to see if it’ll push higher, maybe back to 67.50 or at least 67.33.  But I’m ready to stop out quickly if it fails here.

  106. Rockets- hilarious.
    These are surely part of the impressive French "reserves" which no doubt are still ready to pour in to defend the Maginot Line.

  107. Did the market close early today? this is getting boring, loved the open now no one is in charge

  108. judah – good move.

  109. DIA/RMM – As above from this morning’s alert.  Watch the 10,600 line and you can sell $106 puts above it for full cover but WATCH THAT LINE!   If we don’t hold it, it will be a bad failure for the Dow and I still think we’re failing.

    Let’s see how things behave here with Dow 10,600, Transports 4,300, S&P 1,145, Nasdaq 2,350, SOX 350, NYSE 7,300 and RUT 670 – it’s good to take note of how the indexes line up at critical times

    C/Jtiff – It depends how the government sells.  I don’t see why the treasury should not hold onto an investment but the bears obviously want to put everyting they’ve got into the potential negative spin on C for the next few days – if nothing else but to create cheap entries in a stock that was getting away. 

    I like the C 2012 $2.50/5 bull call spread at $1.12, selling the $4 puts for .98, which is net .14 on the $2.50 spread (1,685% upside).  I’m showing TOS wants $190 in cash + margin for the play to make $236 – very reasonable as a long-term play and the b/e is $3.25.  This is the kind of play you can improve if C dips by selling more puts, like the $2.50 puts,  now .31 for maybe .50 (assuming you are willing to DD at net $2).

    GOOG/Iflan – I doubt it’s more than 5% but it’s the impact on future growth that takes a big hit as you just eliminated the fastest growing segment of the world’s popluation.  GOOG has 1/3 of 400M or about 150M now but the projections are for 1/2 of 800M down the road or 3x growth or more eyeballs than all of the USA so if it is 5% now, the expectations are for 15-20% in 5 years and THAT has to get chopped off their current value, which makes a current p/e of 27 seem a tad more expensive than it was before they lost 1/4 of the world’s population. 

    AMZN/Judah – It’s not just them, it’s all of on-line retail (including me, I guess) that’s been getting a free ride on charging taxes.  The government has been encouraging the growth of the Internet by making it a tax free zone but now push is coming to shove and the free ride will be ending.  This was always going to happen but it does remove a major competitive advantage for AMZN, EBAY and many others. 

    French Rockets/Pharm – Isn’t that the film that was playing in the theater where they arrested Pee Wee Herman? 

    China is building currency reserves in the most distortionary exchange-rate policy ever followed, and Treasury is legally required to name currency manipulators, Paul Krugman says – so it’s time for the U.S. to call out China for its damaging renminbi policy: They’re the ones over a barrel, not America.

    In an apparent surprise to Yahoo (YHOO), its top revenue generator, Joanne Bradford, is reportedly leaving the search giant to become chief revenue officer at Demand Media. Bradford was set to play a key role in Yahoo’s partnership with Microsoft (MSFT).

    LOL Humvee – You should hang out with my daughter, she tends to say "I’m bored" after any 5 minute period where nothing exciting happens…

  110. JRW, SS,  67.25 might become a good line to watch for the next day or so.  Is it the new 67.18?

  111. Man they are trying to push it over!  Someone is a determined seller at the lines…   Volume still lame at 86M on Dow, up just 20M in 2 hours! 

    NYMEX close in 45 mins and oil at $79.80, they NEED that $80 but XLE and OIH are already very uspet and down 2%.  Miners are holding up well after a sell-off so nobody is taking this move too seriously and it’s not much of a sell-off at all.  It’s all about the Fed tomorrow and that’s 2pm. 

  112. Phil, Re you list of "20 stocks I’d be happy to bequeath to my kids", it doesn’t look like anything is on sale right now at a decent price, other than maybe DBA as a buy/write.  Do I have that right?

  113. SS, Out when it didn’t hold 67.25.  Didn’t get anything extra for my patience, but if it makes a run back up, I’ll get back on.

  114. Out of TNA at $ 53.02, ready to reload.

  115. JRW, judah – does your available funds for trading decrease with each day trade until the cash is settled?  If so, do you seperate accounts to keep trading?

  116. Phil: DIA puts selling: end of month expiration ?

  117. DBA/Judah – Well I haven’t looked them all over but I do think that’s right.  My attitude at inflection points like this is we just need to be patient.  If we’re heading back to 11,500 then we can enter those stocks over 10,700 and we’re good for almost 10% (and all we need are flatlines on buy/writes to make 10-20%) and if they can’t make 10,700 then maybe we fall back to 9,900 and I’ll be really glad I waited.  Warren Buffett made $11.5Bn last year and he made it by waiting about 5 years without doing a thing and then he pounced when the market dropped.  It’s hard to be that patient but I do try my best! 

    Bank of America (BAC) advises its clients to buy puts on Brazil’s real to hedge against a slump around the country’s October presidential election, saying it doesn’t believe the vote should be "treated as a non-event, as markets seem to be doing right now.” (ETF: BZF)

    Fifty-nine of 110 fatalities attributed to sudden acceleration occurred in vehicles other than those sold by Toyota (TM), according to a Bloomberg study of NHTSA records. After Toyota’s 51, Ford (F) and Chrysler vehicles were linked to the most deaths – 20 and 12, respectively.  Lots of "TM isn’t so bad" news over the last few days...

    Dow vs Russell chart:


  118. Back in TNA at $ 52.77

  119. Lots of the sudden acceleration problems seem to be people slamming on the accelerator and then freaking out.  Why that realtor in San Diego had to be cajoled into shifting into neutral (fearing the car would flip over?) is beyond me, Darwin at work. 

  120. Hi EricL filled that SCHW condor for .82 are you still waiting?

  121. Stiglitz — Phil, do you have a link to that study?  How GDP is going to break down in the future’s a very interesting topic, and very relevant now for obvious reasons. 
    My only beef with the Euros (full disclosure — my wife’s parents and cousins grew up in Glasgow slums) is that their medical system is held up as an example what we should do if we were only an enlightened our Continental colleagues, but everyone forgets that the only reason they were able to afford to create these systems is because they didn’t spend very much for their own defense, and we won’t even get into the concept of military competence with all due respect to France.  If the US and said FU to Europe after WW2 and left them to stare down Stalin’s tanks on their own, I guarantee you they would not have had the $ to create national healthcare systems anywhere in western Europe.

  122. EricL I see this is the condor for Jun not April!!

  123. DIA/RMM – You really need to work on your sentence structure.  What are you asking?  On the whole, I like the June $107 puts naked if they can’t get back over 10,600 today and it does look like they’re having a spot of trouble. 

    Acceleration/Humvee – Hell, I’m going out to buy a used Toyota so I can zoom around at 120 with a police escort! 

    Backstabbing on the Ides of March, how appropriate!  Sources say Verizon (VZ) has been the main company pressing the FTC to investigate – with an eye toward blocking – Google’s (GOOG) acquisition of AdMob. Verizon frets that the deal could be a precursor to Google launching its own wireless network and becoming a competitor.

    Barron’s noted that consumers showed some signs of cleaning up their balance sheets ever so slightly:

    The Numbers
    1.3%: gain in U.S. household net worth in the fourth quarter from the third
    $54.18 trillion: household net worth in the fourth quarter
    1.7%: decline in U.S. household debt in 2009, the first annual drop since record-keeping began in 1945
    $13.5 trillion: total household debt in 2009

  124. Phil- What are the pivot points (bullish/bearish) we should be looking at on the S&P? Is 1144 a critical support line?

  125. judah – are you going to play for the stick?

  126. SS/available funds, I believe my intraday buying power with Fidelity is updated during the day with each trade and as long as I sell one position before I buy another, my buying power isn’t really affected.  I am trading such a small percentage of my buying power that I don’t pay it much attention.  Fidelity appears willing to give me a lot of rope to hang myself, and I don’t avail myself of the rope.  Like PM in my TOS account, I’ve got a lot of margin, but I keep it in reserve for trouble and opportunities.

  127. Out of TNA at $52.82

  128. SS/stick.  Looks like a good set up for one.  The Dow, SPX, RUT are all hanging around closer to their lows than their highs.  I’m waiting until 3:00.

  129. Closed 1/2 of my short copper futures (one is 1/2 of two…) and 1/2 of my bear fcx 80/85 spread all for a nice profit.

  130. Phil: I like to be brief not as wordy and lengthy  and avoid non-trading stuff:
    as far as selling puts is concerned, my primary and only point of selling DIA puts is always related to cover protective puts.
    as far as selling naked DIA puts is concerned, that I decide as a day-trading issue and do not even ask.
    Selling DIA puts when we get close to expiration: you can always take the last day of the month expiration and gain some time.

  131. Damn, missed it.  JRW, you had the right idea.

  132. BIDU holy LOL batman!. Wrong way on that one!!! Who would’ve guessed front month calls were worth 1000%+ gain 2 out of three months (going back to January)??? I took the Apr 550/510 put spread for 10, but their fundamentals are better even though they are overbought, so it’s a crapshoot. I’ll probably still be buying puts as they blow through 950 ….
    GOOG – covered Mar-580 calls at 1.05. That was a great covered sale at 11.70 last week. Now naked long Jun-580 calls.
    Took the FAX 13/18 spread play ….
    TBT – interesting theoretical case here. Put in an order for the 48/47 (inverse) put spread for a credit of 0.44. Considering the stock price is exactly 48.00, is the market suggesting a 43% (bid/ask .40 / .46) probability you can make a $1?

  133.  Does anyone know how to show options in TOS active trader?

  134. Clarification
    (I meant, lose a dollar)

  135. jc/ options
    Right click on the option price in the trade window and select display in TOS charts. Once in the chart window, click on the active trader tab on the right side of the window……

  136. BSX bouncing back…..very nice.  Gonna do a 1/2 sale now of the 7 Apr10 P for 60c.  Easily rollable to DD on 6 May10s or 5 Jan12s even.

  137. JRW, judah – the lines today have been spectacular.  I just did a poor job of trading them today for more profit.

  138. ss
    Don’t feel bad, the hardwood floor guy needed something so I had to bail with only 5 cents and I missed it too !!

  139.  oce
    Thanks for the info. I only use prophet charts so wasn’t aware of that but it works great.

  140. SS, I surely noticed that JRW hit the top and the bottom today within .01, as well as that intraday resistance line at 67.33.  I’m in TNA at the moment, seeing if it will break through there.  Oh, it just did.

  141. Interesting:

    Stiglitz/Jcm – Here’s a nice NYT summary.  Here’s the report but read it quick as most links to it are deleted.  Perhaps Google is bowing to American censors…  8-)

    I don’t put much stock in that military arguement as it’s specious at best.  What the EU has done is proven that you CAN have national health care – it’s a question of making a national determination to have it and there it is.  They’ve proven it can be done cost-effectively and US citizens do, on the whole, spend 2.5x what anyone in Europe spends on health care on a per capita baisis – which includes 50M uninsured people who pay zero and make the curve look much cheaper than it is.  So we don’t CHOOSE to have a $1Tn military and no health care – we choose to have a $1Tn military and a $2.5Tn health care system while the EU has a $500Bn military and a $1Tn health care system that covers 400M people vs our 250M people.  It seems to me, I’d rather stop spending my own $2.5Tn and let the government spend $1Tn instead because SOMEONE will be saving $1.5Tn and since the government needs the money – I’m fine if they keep the change. 

    These diversionary assertions are the same as any game of misdirection – the people who want you to vote against health care run the military up the flagpole whenever they have something they need to get your attention away from.  It’s Con Man 101 to find something obvious to hold the audiences attention while they miss the scam (in this case the surplus $1.5Tn a year America spends no matter who spends it) going on right under their noses. 

    Pivots/SNS – No, it’s just the point that lined up with 10,600 so I’m starting to track it as 10,600 is becomming a reliable line.  1,150 is the key point on the S&P and 10,700 is the real key for the Dow and anything less than that is simply not a breakout by any stretch.  We’re at 104M on the Dow now so up 20M since 1:30, which is better than the 20M from 11 to 1:30 but still very lame volume and the fact that we’re still red on a super low-volume day is very bearish but I don’t want to speak too soon because Mr. Stick has an hour left but it’s not looking good so far as all rallies are being sold into. 

    DIA/RMM – I think we’re at a very volatilie spot and could drop 200 points overnight so selling puts is less attractive than usual other than the day trades. 

    TBT/BDC – Interesting if it fills.

    Active trader/JCEd – I find it easiers to use "Quick Chart" by right clicking on the contract I want to look at then going to the chart and copying the symbol and pasting it over to Active Trader.  I’m goig to try Ocelli’s way now but I think the main active trader windown is prettier.   8-)

    One, two, three, four – I declare a trade war!  A letter signed by 130 members of Congress was sent to Geithner and Commerce Secretary Locke demanding tougher U.S. actions on Chinese currency manipulation, including higher tariffs on Chinese-made imports. If Geithner labels China a "currency manipulator," Beijing could strike back.

    China is not alone, of course:  Extortion by corrupt officials in Russia has become such a problem that it "may force Western firms to quit" doing business in the country. In China, corruption is described as an "inverted pyramid," with most bribery at the top; India is the opposite, with corruption rampant at lower levels but tapering off higher up. "Russia is a solid block. There is bribery at all levels."

    The gap between what the U.S. and the rest of the world pay for sugar is the widest in at least a decade, prompting sugar users (like IPSU, GIS, KFT, HSY) to get even more vocal in their criticism of the country’s sugar quotas.

    AIG pump of the day:  AIG shares (AIG +3.7%) spike after mutual fund manager Bruce Berkowitz says he bought a big stake in the insurer in recent months. His firm began acquiring the securities in the second half of 2009 "as we started to see cash flows of AIG turn positive… It is still a good company with a good global brand."  Their chart looks like someone is using a defibrillator to try to get a pulse with these news bombshells being used to give them a jolt every once in a while. 

    Sen. Dodd unveils his bill that would place a consumer protection agency within the Federal Reserve and give the central bank new enforcement powers on large banks, all mortgage-related businesses and large non-bank financial firms such as insurers. The bill contains a version of the "Volcker rule" prohibiting proprietary trading at banks. (.pdf)

    DIA $105 calls can be sold for $1.50 again – I like it as a play on a failure into the close but VERY DANGEROUS with a stop at $1.60. 

  142. In TNA at $53.15

  143. Woops – abort that DIA short play, it’s not stopping!

  144. SS, JRW,  On reflection, 2:30 is very often a better entry point for the afternoon Stick, depending of course on where the market is at the time.  I’m not complaining about my 3:00 stick play today, just writing this as a way to remind myself in the future.

  145. That stick man is amazing – why do we ever doubt him??

    TNA $56/54 bear put spread at $1.20.  Break even at $54.80 which is back about Friday’s pre-market high and I’d probably be happy to buy the putter back tomorrow morning and roll up if that happens again. 

  146. JRW, Took 1/2 off as a greed prevention measure.

  147. I have begun to appreciate the stick.  Out of TNA with .30 at 67.50.

  148. judah/2:30 -  We don’t have to sit down at our trading desk until then.  The stick is the most profitable trade out there.

  149. Phil -
    Dia – re your post above – does that mean that you are not fully covered with the 106′s?

  150. SS, First and last 90 minutes of the day.  The rest of the day I just chat with you guys, read Phil’s commentary and his links and look for an occasional option play.

  151. DIA/Samz – It means I will be naked at the close.  I thought we were going to turn there but, luckilly, the Dow didn’t even stop going up so there was not time to hit the button.  The PROPER move is to be 1/2 covered into the close because the DIA $106 puts still pay .50 between now and Friday and can easily be rolled down to 3/31 $104 puts so not a very risky posture to take for .50

    Woo hoo – S&P 1,150 again!  Thank goodness for that 50 point move since 2:30! 

  152. Out of TNA at $53.90 for $0.75

  153. JRW, Out with .50 for 1/2 and .75 for 1/2.  I think we’re done for the day.

  154. What a frigging joke this market continues to be.   SPY intraday chart shows what a farce it all is !

  155. Another 2 1/2% day; would have been better except for the floor guy !!

  156. The FCC rolls out its internet policy initiative this week, proposing a dramatic increase in broadband speeds to 100 megabits per second. The highly anticipated plan, to be formally presented Tuesday, will make a series of recommendations, including requiring broadcasters to give up some of their airwaves.  This is going to be the death of network television (and TIVO).  You just Google a show and watch it – what do you need networks for.  Maybe GOOG is right to concentrate on the US market as $25Bn worth of TV ad revenue will migrate to the web.

    Credit card delinquency rates slip or hold steady at five major U.S. lenders: Capital One (COF), Bank of America (BAC), JPMorgan Chase (JPM), American Express (AXP) and Discover (DFS). It would be nice to believe that fewer people are falling behind on their bills, but rates remain extremely high.

    Abu Dhabi’s sovereign wealth fund issues its first-ever annual review, providing a rare window into the fund’s investment strategies, though not its balance sheet details or overall size. Most of the fund’s holdings are in conventional investments in North America and Europe.

    DIA 3/31 $108/106 bear put spread at $1.05, break even around 10,700.

  157. judah, JRW – how many round trips did you make today?

  158. JRW, SS, Though I’m inclined not to mess with a successful formula, I’d be interested in your thoughts on Edro’s analysis from Friday and re-posted today.

  159. ss

  160. SS, One trip on TZA, two on TNA, and like JRW, resulted in a 2.5% day.

  161. edro, JRW, Judah – tomorrow I will try to simulate and paper trade his idea.  Because it is a double edge sword trying to get out when we are wrong would be key.  I like the potential profits, but I might be inclined to get stopped out too quickly.  I will look at it further.

  162. JRW, judah – I definately have a problem with overtrading this.  I need to be more patient.

  163. Question for you TNA/TZA players, do you set a stop order as soon as you make your trade, or do you wait and pull the trigger to sell as things unfold?

  164. Well that was exciting – who said they were bored before?

    We lead off tomorrow with housing data and I don’t know on what planet people think that’s going to be good but you sure can’t tell from the close can you?

    What would happen if America’s credit rating is downgraded? Lenders would demand higher interest rates before they lend money, those rates would make it more expensive to borrow, and the country’s debt might balloon. But legislators also might be forced to finally make some meaningful decisions and not pass them off to some toothless commission.

    Investors breathe a sigh of relief after the FDA asks Amylin (AMLN +17%) and partner Eli Lilly (LLY +0.2%) to finalize labelling information for its diabetes treatment Byetta, and to propose a risk evaluation and mitigation strategy – most likely removing the possibility of a lengthy delay for new trials.

  165. Humvee,  We always use mental stops not automatic stops, otherwise those thieves (market makers) will steal the profits. 

  166. juda-  thanks, i kinda thought so, but wasn’t sure.  It’s amazing how you guys seem to have a successful system, I’m impressed.  I have good days, like today, but you guys are way more consistent!

  167. humvee, I have a pre-filled sell ticket with my finger on the button and watching the lines.

  168. Humvee,  It’s all JRW.  I just play his lines and play for the Stick.  It is brainless on my part.

  169. hi PhiL :  I bought 1500 shares  GE at $16.17 ,now $17.28 and sold  April $16 calls for $.65 ,now $$1.48 and sold April puts for $.42 now $.20 Should I roll to the June $16 Calls & puts for $ 1.74 and $.47  or is it better to go to Sept. $17 calls for $1.45 and Sept. $16 puts for $.90 ? Thank you

  170. brainless, now that’s something i excel at!

  171. ss-  when you have your prefilled sell, you already have the sell amount filled out?  I’ve found that I can enter an order in TOS, at the "Mark", but by the time it gets to them it doesn’t fill because things have moved, then I have to reset my trade price; you don’t sell at the market?

  172. TOS/Active Trader:  On the Active Trader page next to the textbox where you enter the symbol is the link selector.  Select one of the links (I choose 9 Sky).  Now in the option view you can right-click on an option and go to Send To and select 9 Sky.  Much quicker than moving the symbol to a chart and then to AT.

  173. humvee – yes, it is a prefilled ticket for a market order to sell.

  174. ss  thanks

  175. Phil/KO.  Still looking over your list of 20.  KO is down to its 200 dma.  Do I recall correctly that they dropped recently on news that they were buying back the bottling operations, but they may buy them and spin them back out?  Good time for a coke and a smile, you think?

  176.  Phil
    Im in the Jan USB 1.5 calls fully covered with the Mar 24 callers, putters taken out. Looking for a roll target – would you go to the Apr 25′s or the Jun 25′s? Thanks

  177. These diversionary assertions are the same as any game of misdirection – the people who want you to vote against health care run the military up the flagpole whenever they have something they need to get your attention away from.  It’s Con Man 101 to find something obvious to hold the audiences attention while they miss the scam (in this case the surplus $1.5Tn a year America spends no matter who spends it) going on right under their noses. 
    Aw C’mon now Phil — Must you insult me? To say I’ve been swayed by a specious argument is to suggest I’m too dimwitted to think for myself.  Is that what you’re really trying to say?   You’re the same age as I.  We, I suspect, have very similar backgrounds and educational influences. I don’t assume your opinions are the result of tin-foiled conspiracy theories (though some might :) ) because they are diametrically opposed to some of my opinions.  I’d appreciate the same respect.   The real problem with the health care type debates is that too many on each side assume malice or deceit on the other side, or in your case, you assume people are too stupid to see through the fog. 
    It’s not "specious" to point out that these sociological arguments are a lot more complicated than they seem to be when we sit around and solve the world’s problems in our blog posts.  There are countless influences, some illegitimate, in fact specious to be sure,  but others are not so. In my opinion, it’s not specious to use the military argument in the matter of discussing Euro health care systems.  Why?  If someone is to hold up the Euro example as the model, then you simply must discuss the circumstances that allowed them to build this system.  It wasn’t that they simply made a choice.  They were given the luxury of making that choice because we rebuilt them after WW2 (The Marshall Plan), and our military  and nuclear umbrella protected them from most assuredly being overrun by the Soviets.  Take away those influences and Europe simply does not spend the 40 years after WW2 building a vast social safety network.  Now you can argue it was in our interests that this occurred, and that’s fine.  But I believe it’s unfair to label it as a specious argument.  That sounds dismissive, and insulting. 
    Now why is this relevant today?  Because I’d like to hear debate on healthcare that isn’t based on the clever use of statistics while sliming anyone with an alternate view.   If I want,  I can find articulate arguments with clever bar charts that counter your arguments, and they may suggest that your side is nuts.  But am I better off for it?   No.  All I have is two articulate ideologues trying to convince me that the other guy is a bigger liar.  There has ot be a better way to conduct this debate.

  178. Phil,
    I don’t know if I told you lately but you da man! I’m doing so much better following your guidelines. It’s like you actually know what you are talking about.  8-)  I’ve tried a lot of services and none of them are as comprehensive or honest AND successful. I appreciate all youz other guys/gals input as well…learning tons as a relative newbie to this game.
    When I get your system down too, the sky is the limit. I’m stoked!

  179. jcmcn5- Thank you. Stated quite a bit more eloquently that I was just about to.

  180. So Phil, Re: your politics and the economic structure, what you are saying is that Rage Against the Machine was telling the truth all along. To put them in context for the uninitiated, Zack de la Rocha (the lead singer/author) is Native American so he is justifiably pissed.
    Warning: explicit content.

  181. Speaking of the French military, I recently came across a newly declassified French military training video. The method is reported to be especially effective on young American Presidents:

  182. Daveo, forgot about the send to function in TOS, but thanks for the tip…..much easier way to get the info into the window. TOS platform is very, very good in my view. Now that they have been ranked #1 again, I plan to make suggestions for small, but useful additions so navigation is easier.

  183.  Cap…that certainly is an interesting chart on aapl.  I watch this one very closely and have noted this undulating  pattern to the stock price.  I believe it will pull back again to at least 205.  On that basis I’ve place GTC orders for October calls when AAPL hits 205.  That’s the only way I can discipline myself to just wait for the pullback. 

  184. Balance NV; BIDU depends on your margin situation.  You can wait until it drops (if it drops) and then roll it out to like January and hope it comes in.  If you can avoid making a panic move; that’s your best bet.

  185. Did I miss something? Why all the French bashing today? Have to tell ya, Im a big fan of their troops. Deployed to the Kyrgyz Republic last year and they were all super nice…. They also had a stripper pole and copious amounts of alchohol in their hangar, now they know how to deploy!

  186. Internet taxes.  As a consumer, I love it (although most sites now charge taxes).
    Realistically, there is no reason whatsover for AMZN not to have to collect sales taxes; and it gives them an unfair advantage.

  187. Internet taxes.  As a consumer, I love it (although most sites now charge taxes).
    Realistically, there is no reason whatsover for AMZN not to have to collect sales taxes; and it gives them an unfair advantage.

  188. IWM Daytrades
    I was Lucky enough (I don’t consider it anything but yet) to make 0.06 on IWM Mar67P and 0.21 on IWM Mar67C.
    As the delta is roughly .25 I buy 4x options so I get a return approximating buying the IWM stock.
    I like IWM options because the volume is so high and the spread is so small and you can try it for less than a dollar so your max loss is very very small.
    Today I started with 20 contracts of the calls at 0.90, DD’d at 0.70 and sold 1/2 at 0.80 to lower my basis to 0.80 ,  Bought some puts at 0.55, DD’d the calls again at 0.60, sold the puts at 0.61, sold 1/2 of the calls to lower my basis to 0.70 and sold the calls at the end of the day at 0.91.
    I used JRW’s pivots, standard pivots and was playing with Camarilla pivots -they were all pretty close
    Try 1 contract -

  189. IWM daytrades
    Oh Yea –
    I made 2000 (calls) * 0.21 = $420 + 4000 (puts, which were cheaper) * 0.06 = $240 for a grand total of $660 on approximately a $4000 investment.

  190. Good morning!

    Word is the Fed comes in with no tightening in sight so commodities are rallying back up.  Gold at $1,112, copper $3.444 and silver $17.28 but oil is hopeless at $79.57 as is nat gas at $4.39.

    We get housing numbers and retail numbers before the bell but it’s the 2:15 FOMC rate decision and the 3 paragraphs they release that will move the markets today.

    "So here we are, $1.25T of MBS/Agency paper purchases later to suppress mortgage rates, and a home buying tax credit to bring out first time home buyers – and builders still have very little confidence," Miller Tabak’s Peter Boockvar writes. Earlier, NAHB cited a lack of available credit and the weak job market for a nine-month low in confidence.

    The Dodd bill does what so many pundits had, until now, to debate among themselves: put a (surely loophole-free) definition to proprietary trading. Geithner: The bill’s strong and we’ll fight for it.

    Industrial production may have felt the impact of blizzards, but it still rose for the eighth straight month – the first time that’s happened since 1998, and it’s still a long way from climbing out of its hole.

    Recent billions in buybacks have big businesses saying "We’re cheap" to investors. But not all repurchase plans have the same bounce – and just because a company thinks it’s a bargain doesn’t make it so.   This is nonsense – a lot of times buybacks are companies saying: "This is the only way we are going to be able to increase our EPS numbers."

    Why slog your way through Michael Lewis’ The Big Short, when Deal Journal tracks down the 24-year-old author of the prizewinning Harvard thesis on subprime mortgage-backed CDOs Lewis cites as "more interesting than any single piece of Wall Street research on the subject”?

    Tuesday’s economic calendar:
    7:45 ICSC Retail Store Sales
    8:30 Housing Starts
    8:30 Import/Export Prices
    8:55 Redbook Chain Store Sales
    2:15 PM FOMC minutes
    5:00 PM ABC Consumer Confidence Index

  191. edro – nice work and very interesting.  How much did commissions take from your profit?

  192. GE/Dflam – Or you could keep the protection until we get through expiration week.  The Apr $16s are $1.75 with about .50 in premium (28%) that WILL expire in 5 weeks and that’s 2.8% right there.  The puts I assume are the $14s and that’s what you get for being a wimp and selling such low puts because you’d be much happier if you had sold the $16 puts, right? 

    This is very key with a buy/write – run the net numbers for serveral strikes and think about what you can live with in BOTH directions…  Focusing on the current problem, you have $25,935 worth of GE that you paid net $22,650 for and you have $2,220 in callers with $750 in premium and $300 in putters that are all premium.  GE has a lot of CRE so they do make me nervous but, if you intend to stick with it long-term then I’d stay conservative and collect $7,500 for the Jan $15 calls ($3.05) and the Jan $17.50 puts ($2) which gives you good downside protection (plus you can roll the puts to 2012 $15 puts about even) and the expectation of rolling the calls to the 2012 $20s, which are now $1.45 in conjunction with another put sale if things go well. 

    That puts + $5,280 in your pocket or $6,280 if you wait for expiration as you can roll anything to those two positions so right there they save you $1,000 in your first week!  Just using the $5,280 we drop your basis to $17,370 or $11.58 a share with a call away at $15 (up 30%) and an average put-to at $14.54 – still lower than where you are now!  Buy/writes are meant to be a conservative strategy and if you consistently play it that way, you will have far fewer headaches! 

    LOL Humvee!

    Thanks Daveo!

    KO/Judah – Yes, they are worth watching.  If they break over the falling 50 dma at $54.50 then maybe worth chasing but let them test it and we’ll see if it’s the real thing.  8-)

    USB/Deano – I assume you mean the Jan $15s because there are no $1.5s and obviously, from there you could roll to 2x.  Even from the $15s, you have no premium at all so you may as well own the stock at this point.  The Jan $20s are $6.50 (-$3.50) and have just .60 in premium and still have an .84 delta so what are you missing to the upside?  Since I’m worried about a possible pullback my preference would be to move to the Jan $20s and sell the Sept $25s at $2.40 and the Sept $23 puts at $1, which puts another $1.50 in your pocket so that roll and the roll up on your longs takes $5 off the table and leaves you with a $5 spread and still some time to roll.

    Diversionary/Jcm – Gosh, I was not trying to insult you.  I assumed you understood psychology and I was sharing my observations.  Sorry if you took it that way – it’s very bad to bring up these topics after the weekend, when I’ve been watching Fox and I’m usually very pissed off at conservatives…  I don’t have time to get into it this morning but surely you can’t insist that there is a directly relevent line of reasoning that connects the US’s choice to be the dominant military force on the planet to our choice to be the only G20 nation not to have universal health care other than the usual "guns or butter" decision we learn in economics 101.   

    It was General and President Eisenhower who warned us in 1961, on the eve of Kennedy’s Presidency, saying:

    We have been compelled to create a permanent armaments industry of vast proportions. Added to this, three and a half million men and women are directly engaged in the defense establishment. We annually spend on military security more than the net income of all United States corporations.  This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence — economic, political, even spiritual — is felt in every city, every State house, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.

    In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the militaryindustrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

    We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.

    Also in the speech:

    The prospect of domination of the nation’s scholars by Federal employment, project allocations, and the power of money is ever present.

    As we peer into society’s future, we — you and I, and our government — must avoid the impulse to live only for today, plundering, for our own ease and convenience, the precious resources of tomorrow. We cannot mortgage the material assets of our grandchildren without risking the loss also of their political and spiritual heritage. We want democracy to survive for all generations to come, not to become the insolvent phantom of tomorrow.

    Down the long lane of the history yet to be written America knows that this world of ours, ever growing smaller, must avoid becoming a community of dreadful fear and hate, and be instead, a proud confederation of mutual trust and respect.

    We pray that peoples of all faiths, all races, all nations, may have their great human needs satisfied; that those now denied opportunity shall come to enjoy it to the full; that all who yearn for freedom may experience its spiritual blessings; that those who have freedom will understand, also, its heavy responsibilities; that all who are insensitive to the needs of others will learn charity; that the scourges of poverty, disease and ignorance will be made to disappear from the earth, and that, in the goodness of time, all peoples will come to live together in a peace guaranteed by the binding force of mutual respect and love.

    Wow – you may as well stick a flower in his hair, give him a joint and send him off to Woodstock, right?  So go ahead and blame Europe for our all guns, no butter choices of the past 50 years and hey, maybe we can keep it up for another 50.  So I won’t waste your time with articulate arguments or charts – better not to try to change your opinion with facts or logic as you say clearly it’s not going to change so congratulations on your unwavering faith – I wish I had it because it would save me so much wasted time reading those articulate arguments and charts that contradict the things I belive in…

    Thanks AC!

    Rage/AC – Yeah, I like those guys.  Didn’t know the guy was an Indian – that’s a cool perspective. 

    Video/Pstas – Surely that wasn’t the right link…

    French/Jrom – Oh come on, get with the program!  They are French and the French are cowards and nearly communist and lazy and rude and live on handouts and drink a lot of wine and act kind of gay and speak with ridiculous accents.  Don’t you pay any attention to what Rush is teaching us??? 

  193. Speakiing of Rush – Here’s a classic bit where he, coincidentally (because I’ve been told this almost never happens), diverts attention from what he did by – yep, you guessed it, turning it into a flag-waving, fist pumping speech about his support of the military and his enemies’ questionable patriotism.  As Daily Motion says in the headline – "A Conservative Masterpiece."

  194. Notice at the beginning he brings out a guy who "looks just like Stalin, which irritates the hell out of Libs."   Now I’m a "Lib" and maybe I’m missing something but do Conservatives LIKE Stalin? 

  195. Comparison between 1980 and 2010 Credit Card Applications

  196. Don’t blame me, someone just sent me this:

  197. Insult/Phil  For the life of me, I cannot understand why ANYONE would feel your comments are towards any one person. I mean, you have thousands of readers, who like me, subscribe to read your daily writeups that they can’t find anywhere else. Those who get their feelings hurt after reading any article should grow up. IT’S NOT ABOUT YOU! Keep up the good work Phil  :)

  198. That’s right 1020 (and by the way YOU totally suck!) 8-)

  199. I don’t have time to get into it this morning but surely you can’t insist that there is a directly relevent line of reasoning that connects the US’s choice to be the dominant military force on the planet to our choice to be the only G20 nation not to have universal health care other than the usual "guns or butter" decision we learn in economics 101.  
    Please show me where exactly I wrote that?  I wrote nothing about US choices made in the past, nor did I write anything about what choices should be made.  I said, once again, that Europe could not have created the universal care model they had if they had to worry about reconstruction costs after WW2, and the cost of protecting themselves from the FSU.
    But gee, thanks for the sarcasm Phil, the greatest weapon of the smallest minds.

  200. Suck/Phil  Does this mean we’re friends or did I miss something……