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Testy Tuesday – Playing in our New Range

SPY 5 MINUTE And once again the futures are up! 

As Dave Fry notes in his chart on the right, we had a lovely boost yesterday as the Fed pumped $7.24Bn into the IBanks covering a solid 34% of the $20.98Bn of junk that was offered up to them – in this case bonds that were maturing 2018-2021 at toxically low rates.  The idiot taxpayers in this country will never know what hit them in this scam until rates begin to fly up and these bonds that the Fed is putting us on the hook for begin to be discounted towards zero.  

When you wonder what kind if idiots would be buying 10-year notes at 3% when a gallon of gas was $1.40 ten years ago and now $4 – that idiot is you.  Originally, that idiot was a bank but banks aren’t allowed to lose money in America – that’s what taxpayers are for!  What the Fed does, on your behalf, is to buy all those notes from the Banksters at face value – because if they tried to sell them on the open market they’d never get it.  

In exchange, the IBanks go out and buy more Government debt to make it look like there’s actual interest and the little game of hot potato keeps going until the music stops and the Fed’s $2.6Tn Balance sheet is transferred back to the taxpayers and added to our national debt.

Isn’t economics fun? 

We held onto our bullish stance from the weekend but covered with a couple of index puts that will be beat up this morning as the Dollar is slapped back down to 74.80 but that’s OK because 74.80 is the line we expected to be tested in yesterday’s Member Chat, where I used it as an example of how I could know that’s the support line we’d hit on the Dollar through math, and not because I am just psychic, as some Members have been saying.  

While it’s very useful to know what channel the Dollar is trading in, not too many of us play currencies but, fortunately – the Dollar affects everything else so we can make lots of plays based on knowing what the dollar is going to do but, of course, first it needs to hold 74.80!  

Our cool new chart shows you our anticipated range and those 5% levels should be tested (and failed) today and then we can get on board for the ride down as we face the uncertainty of the end of the POMO schedule until the new one comes out Wednesday at 2pm at the same time as our Government is trying to hawk off another $72Bn in debt, starting today with $32Bn in 3-year notes at 1pm.  

Probably a good day to go long on TBT, now trading at $34.50 and you can pick up the weekly $33 call for $1.55, which is only a nickel of premium with some really good upside potential and yesterday’s low was $34.30 so figure a stop at $34.25 is risking .25 to make $1 or more if things go well.  

As I said to Members in yesterday’s chat, we are right back to the speculative bubble we were shorting a week ago – I know investors have short memories but gee….   Cullen Roche points our that, despite the tightening of margin requirements on silver this month, margin debt is exploding back to the same record level ($350Bn) that we hit just before the market began to fall apart in 2007.  In February alone, margin spending jumped $20.7Bn, and Cullen notes:  

To put that $20.7 billion incremental leverage in on month into proper perspective, it represents a 7.2% jump, or an increase of no less than 129% at an annual rate. And, it’s not just February – the rising use of credit to buy stocks has zoomed ahead at a 64% annual rate in the past three months. If and when the markets breaks, the problem in trying to contain the downside momentum is that there are no short left to cover, which actually helps as a shock absorber. The Fed has successfully cleaned out the short community, and the extent to which we see margins being called away may very well accentuate and downside pressure…if it should come."

BAILOUT Monopoly.jpgA CIO from an unnamed investment firm sums it all up nicely:  

If this financing pyramid is near correct, then prices are simply a reflection of leverage rather than an inflation of money. If there is only speculative non-bank horizontal money, then whatever commodity (non-monetary) inflation exists must be transitory, because it relies on a permanent Ponzi condition (leveraged commodities holdings that depend on prices being higher to satisfy liabilities).

So it seems that the central banks distortions of the last several years are creating some imbalances that are unintended and unwanted, which is to increase speculative volatility in things like oil, which goes from $40 to $150 to $50 to $130 over and over. Paper profits change accounts but the real economy is not theoretically affected, except that it is held hostage to this casino game of rapidly changing prices for basic materials and necessities that businesses and consumers use to make decisions. So the economy is in actuality disrupted by the casino, the casino creates no net wealth, and everyone is worse off as this charade continues.

As I said before – isn’t economics fun?  It sure is if you are a Bankster, especially if you are JP Morgan (the IBank, not the dead guy, although he had tons of fun while he was alive), who had their 3rd CONSECUTIVE quarter without losing money trading on a single day – averaging $112M a day in profits in Q1.  The odds of going 180 days without a loss is over a Quintillion to one in an un-rigged market – EVEN IF you assume JPM has a 66% chance of winning because they are so smart!  This is why JPM is our favorite Bankster for long-term investing – it’s like picking the Globetrotters to beat the Washington Generals – the only hard part is finding some fool to bet against you.

Goldman Sachs, embarrassingly enough, took a loss on one of their trading days and I’m sure heads are going to roll over that one.  Of course, poor GS was shuttling back and forth as they were under investigation for numerous (alleged) crimes but that’s all behind them now and it’s Sheila Baird who’s losing her job – not anyone at GS.  As I said to Members yesterday – that should be good for our FAS play today.  Keep in mind Q1 included the Earthquake so JPM (and BAC) had PERFECT records, indicating they even played for a Sunday night disaster perfectly on Friday – AMAZING!  BAC is, of course, driven by those gamblin’ fools from Merril Lynch – who do very well except when they don’t and bankrupt the firm.  

Things are not "all better" just because financial thugs are doing well.  That’s like saying it must be a good neighborhood because the Crips clearly have control of the entire block.  It’s great if you happen to be a Crip but not so good if you are a Blood or an ordinary citizen caught in the crossfire.  

Speaking of Bloods – China had an $11.4Bn trade surplus in April on record exports of $156Bn and up 10x from March’s $140M and over 200% larger than the $3.2Bn "expert" economists had predicted.  This despite near-record prices paid on 5M barrels of imported oil.  Consumer prices in China rose 5.4% in March, the most in 32 months and we get April’s total tomorrow, which I would say should be even higher although the "experts" disagree with me and are projecting 5.2%.  Crude oil imports were down 0.6% in April as consumers cut back a bit but it was offset by the 10% price increase and iron ore volume dropped 11% with rubber and copper imports down 14% in April – all signs of a slowing economy but you won’t hear that from our MSM as the fable of infinite China growth is one of the key market drivers

Greece is on, off – who cares?  As I mentioned yesterday, Greece, Ireland and Portugal combined’s total debt is less than Japan is spending to clean up their current disaster, which will only add 4% to their own current $11Tn debt load against a $5Tn economy.  If we’re going to get all upset about Greece’s $120Bn debt, we may as well throw in the global towel on Japan and don’t even THINK about the US debt, which is 25% of the entire planet’s GDP.  I think the real danger of the Greek crisis IS solving it – because that will then free up the Cassandra crowd to focus on REAL problems like Spanish and Italian debt or US Municipal Debt (much of it hitting the fan in June) or whatever else will distract them from the real issues of Japan and America and even the UK’s $3.666Tn debt (there’s that decimal again!), which is 149% of their GDP.

So sorry folks, I’m not going to tell you things are OK – instead I will leave you with my all-time favorite film quote from Network and we’ll pick up tomorrow as we roll our short plays to stronger positions this morning and play for that rejection off the 5% lines in this morning’s ridiculous pre-market pump job (watch that 74.80 line on the buck):



I don’t have to tell you things are bad. Everybody knows things are bad. It’s a depression. Everybody’s out of work or scared of losing their job. The dollar buys a nickel’s worth; banks are going bust; shopkeepers keep a gun under the counter; punks are running wild in the street, and there’s nobody anywhere who seems to know what to do, and there’s no end to it.

We know the air is unfit to breathe and our food is unfit to eat. And we sit watching our TVs while some local newscaster tells us that today we had fifteen homicides and sixty-three violent crimes, as if that’s the way it’s supposed to be!

We all know things are bad — worse than bad -- they’re crazy.

It’s like everything everywhere is going crazy, so we don’t go out any more. We sit in the house, and slowly the world we’re living in is getting smaller, and all we say is, "Please, at least leave us alone in our living rooms. Let me have my toaster and my TV and my steel-belted radials, and I won’t say anything. Just leave us alone."

Well, I’m not going to leave you alone.

I want you to get mad!

I don’t want you to protest. I don’t want you to riot. I don’t want you to write to your Congressman, because I wouldn’t know what to tell you to write. I don’t know what to do about the depression and the inflation and the Russians and the crime in the street.

All I know is that first, you’ve got to get mad.

You’ve gotta say, "I’m a human being, goddammit! My life has value!"

So, I want you to get up now. I want all of you to get up out of your chairs. I want you to get up right now and go to the window, open it, and stick your head out and yell,

"I’m as mad as hell,

and I’m not going to take this anymore!!"



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  1. Phil,
      What is your current thinking on RIMM? I have sold  JUN $50 puts with a breakeven  of $48.55. You have seemed positive on them lately, in contrast to a lot of negative indications. Would you recommend rolling them out to the JAN $45s, which is about even? 

  2. HRB/Phil – Big hit on HRB, down 8%.  Same old story: toxic bond holders try to get their money.   Maybe a put-selling opportunity?

  3. PP for today.

  4. Pharm / DEPO – what is your fav way to play this one?  I already own the stock in one account but looking to add more exposure.  Thx.   

  5. Phil / ilene / chart — New chart is an excellent addition and excellent layout! I don’t know how that graphic is made and/or kept, but I was wondering if it might be possible to make it clickable for a larger image? The numbers are just a bit hard to read.

  6. DEPO/terr – we are waiting for an annoucement on distributions/sales rights.  Since ABT walked away, DEPO needs to find a new partner.  Manufacturing is most likely underway and will be part of a deal at signature.  So, I am moving most of my Calls to December.  The $8/12 BCS for 1.35 and selling the $8 Ps for 1.45-1.50 would be a nice entry for a net credit of 10c (all December).

  7. Phil- doesn’t raising the margin requirements to,”weed out speculators” just screw the little guys like us? I have a hard time believing that these raised margins are going to affect the big hedge funds and POS banks like JPM and GS.

  8. Raiman – it is usually posted a the end of the day.  Today’s bigger picture is here.

  9. Green Mountain Coffee Roasters (GMCR, US$76.5, C-1-9) Raising estimates and PO
    We are raising Px Tgt from $68 to $90. We raise our FY11E EPS from $1.10 to $1.35, FY12 from $1.70 to $1.95, and FY13 from $2.25 to $2.50, due to an increase in our revenue and margin forecasts. On 5/3/2011, GMCR reported F2Q11 results that beat expectations. Concurrently, GMCR announced a primary stock offering of 8.19m shares, with the proceeds used toward debt pay down and general corporate expenses. 2Q results were encouraging for two reasons: 1) The upside in brewer growth, in a seasonally slow quarter, indicates household penetration is accelerating and that Keurig is moving further along its product life cycle.


  10. All that is holding any of it togeher is the QE glue, so next round is coming, but when and what will it look like ? The only person in Congress even talking about it is RPaul(not actually a rep ?) that I am aware of ? Between The phony bond sales and IMF, my optimism has been reduced to almost zero for a long time now. Especially when you consider nothing has been addressed toward the hundreds of trillions still floating on banks off balance sheets world wide in derivatives as though they don’t exist ? And some have said I am conspiratorial ? little do they know of what is real right before their very eyes and refuse to see for a lack of effort or? Not sure.
    Good read , I can tell your fired up today . 

  11. Ilene – charts work well and give that extra zing of compatability as a visual that ties it all together. A thing of joy and beauty

  12.  Phil
    Jan 2013 20 P for $1.5.

  13. Good morning!  

    To be very clear – either doubling down or rolling up (or both) on bearish plays like yesterday’s IWM and DIA puts is the way to go into the morning thrust.  Risky but potentially profitable.  Oil came in as a great short off the good old $102.50 line and can still be played below $101 with tight stops.  

  14. For a deeper understanding I would offer this as well as prayer and meditation by whatever means works for you,

  15. Are we covering FAS today? 

  16. Phil
    Your opinion on HRB and the validity of the threat on them to buy back toxic mortgages previously sold?

  17. raising margin requirements/jromeha — the only market participants that will be screwed by higher margin requirements are the ones who don’t have access to infinite free Fed money.
    Oh wait, that’s us.

  18.  Oil Line
    R3 – 108.40
    R2 – 105.9
    R1 – 103.50
    PP – 101
    S1 – 98.67
    S2 – 96.17
    S3 – 93.8

  19. NFLX flying this week? Latin?

  20. I bet if PIMCO was to take a large chunk of their current 85 billion in cash or so and wanted to buy PMs or other commodities they could negotiate a lower margin requirement and they are not one of the blessed at this juncture, but all else remains the same pertaining to banks and us ,as you suggest. The entire thing is rigged , a complete sham, a giant illusion  ! 

  21. Good morning again!  

    So we have a new set of levels to watch and thanks to Elliott and Ilene for putting together this chart, which adjusts for the Dollar on the 5% rule.  We expect the Dollar to test 74.80, which it did this morning but we can assume that was forced through the usual shenanigans.  Europe is a freakin’ disaster but if we have a poor Treasury auction – we could look worse again at 1pm.  

    Ireland owes $645Bn to EU banks mostly to Germany and England and that’s what the Greek crisis is all about because if the hot-blooded Greeks tell the EU to F off, then the fighting Irish will not be far behind.  On the other hand, if the EU rolls over for Greece, Ireland will demand the same terms – that’s why nothing is getting decided on Greece even though it seems "obvious" that they need the bailout.  On the whole, the strategy is all "extend and pretend" because the EU cannot afford to let this come to ahead right now.

    So, at 9:45 the Dollar is at 75 on the button, but it’s not spooking the markets too much yet.  The Euro is $1.433 on expectations that Greece is "fixed" again.  The Pound is $1.633 and it’s 80.58 Yen to the buck, down from 80.87 at 3am.  When that 3 am trade is on the button like that – the Bots are usually in control so don’t expect much bearish action this morning unless the Dollar pops 75.25.

    I mentioned TBT in the morning post, the weekly $33s shot up to $1.65 already and we may as well pay a dime for the May $33s at $1.75 at this point with a stop at $1.50.  Let’s go 10 of those in the $25KP, looking for .50+ to set a trailing stop (at $2.30 and then a .25 trail once we cross over $2.50).

    At 2pm yesterday we went for the IWM May $83 puts at .75, those are now .45 and can be rolled up to the $84s at .70 (+25) and doubled down at .70 for net .85 on 2x so we’re down .15 and we stop out 1/2 at .85 which puts us back to 1x at a higher strike with a good basis.  That’s the plan anyway.  If things get worse (RUT over 850), then we sell the $83s and use that money to roll back to June $82 puts, now $1.22.  

    DIA $126 puts were .99 yesterday, now .80 but the roll is .40 and not worth it (50% vs 33% on the IWMS) and .19 is not much to make up in 9 trading days on the Dow so we take no action there unless the Dow breaks 12,750 – which is where we thing we’ll top out.  That’s the line where we might want to DD, perhaps at .60 for a net .80 average.  

    USO can be used to short oil off the $102 line with the May $40 puts at .80 (now .86).  There’s a .02 spread so you can play them off the line if you have an inexpensive broker – those puts were over $2 on Friday but you should be thrilled with $1.20.  

    Tuesday’s economic calendar:
    7:30 NFIB Small Business Optimism Index
    7:45 ICSC Retail Store Sales
    8:30 Import/Export Prices
    8:55 Redbook Chain Store Sales
    9:15 U.S.-China Strategic and Economic Dialogue
    9:30 Fed’s Duke: Community Development Finance
    10:00 Wholesale Trade
    12:45 PM Fed’s Lacker: Economic Outlook
    1:00 PM Results of $32B, 3-Year Note Auction 

    Market preview: Stock futures hold gains after import pricesrose at a slower pace in April and margins for crude oil futures are raised 25%. S&P +0.4%Microsoft’s $8.5B deal for Skype boosts overall investor sentiment but its shares are lower. Overseas markets advance and commodities gain as China’s April trade surplus exceeded expectationsLater: wholesale trade.


    At the open: Dow +0.17% to 12706. S&P +0.3% to 1350. Nasdaq +0.35% to 2853.
    Treasurys: 30-year -0.15%. 10-yr -0.1%. 5-yr -0.09%.
    Commodities: Crude -1.19% to $101.33. Gold +0.25% to $1506.90.
    Currencies: Euro -0.06% vs. dollar. Yen +0.42%. Pound -0.21%.

    10:00 AM On the hour: Dow +0.33% to 12727. 10-yr -0.1%. Euro -0.03%vs. dollar. Crude -1.35% to $101.17. Gold +0.47% to $1510.20.

    NFIB Small Business Optimism Index: -0.7 to 91.2, vs. -2.6 prior. It’s the second consecutive month of decline in small business optimism, and suggests the bulk of new hiring is happening in larger firms.

    ICSC Retail Store Sales: 0% W/W, vs. -0.8% last week.+2.7% Y/Y, vs. +2.8% last week. Retailers saw solid Mother’s Day sales, and demand may be rising for non-discretionary goods.

    April Import Prices: +2.2% vs. +2.6% prior. Ex-energy+0.6% vs. +0.3% prior.

    Knocking down the Dollar at 10am – interesting timing:  House Speaker John Boehner raises the bar in talks over the U.S. debt ceiling, telling the Economic Club of New York that spending cuts must exceed any boost to the borrowing limit. Also, "raising taxes is off the table" because it would "have a devastating impact on our economy." The debt limit debate in Congress is now seen as stretching into July.

    Bill Gross with a DD!  Bill Gross’s initial attempt at shorting U.S. Treasurys didn’t work out so great (they had their biggest rally in eight months) - so he’s doubling down. Pimco’s $241B Total Return Fund is now -4% in government debt, from -3% in March. Cash and equivalents soared to 37% from 31%. 

    The WSJ reports Greece is expecting a new €60B aid package to be approved by the EU/IMF by next month. That amount would cover Greece’s financing needs through 2013. European shares are soaring. Stoxx 50 +1.45%. The euro is up a full cent from overnight levels at $1.4387. 

    German officials get their minds right, backing off commentsabout Greek restructuring. "We’ll just have to bite the bullet and go along with (more aid) … the appetite for restructuring the country’s debt is not there," says the CDU’s budget spokesman. Greek banks rally. NBG+5.0% premarket. 

     "We don’t do Greece any favors if we speculate," on how fiscal reforms will work out, says Angela Merkel. With teams of EU and IMF auditors poring over Greek books until week’s end, Merkel is (publicly)withholding offering her opinion about further aid to the country. Comments from her lieutenants offer more clarity

    The "Greece must restructure" crowd had the ball over the past week, but the "kick the can down the road" folks wrest control today. ECB members Nowotny and Bini Smaghi hit the tape, joining German lawmakers in calling for more aid and/or adjusting the existing loan package. 

    The euro gives up some of its sharp morning gains after EU Economics Minister Olli Rehn says it’s premature to talk about a new rescue package for Greece. EarlierFXE flat. European shares barely off of highs. Stoxx 50 +1.25%.

     TEPCO formally asks Japan for aid. Direct compensation costs could run into the tens of billions of dollars. TEPCO also faces ¥750B ($9.3B) of debt repayments this year and ¥1T of additional costs due to the outages of its nuclear units, and faces no chance of raising these sums in the markets.

    Good news while WFR is on sale!  Japan nixes a plan to increase nuclear power to 50% of its energy source by 2030, instead putting its focus on renewable energy. The country currently gets 30% of its energy from nuclear power. PM Kan also announces he will take a pay cut until the nuclear crisis is resolved.

    First Solar (FSLR -2.9%) and a unit of China Power New Energy Development say they will collaborate on solar-energy projects in China, the U.S. and other markets. First Solar is trying to gain access to China’s solar sector, as it and other producers face uncertainty over anexpected fall-off of business in Europe. (PR)

    Singapore, with 3 institutions in the top 6, and Canada, with 5 lenders in the top 20, are the 

  22. Good morning,


    IWM    85.92,  85.61,  84.96,  84.41,  84.06,  83.80,  83.40,  82.98  and  $6 Bil of POMO  !!

    Chart coutousy of Sjack

  23. Hi Phil ELNK my question" is there any future in this stock I am just about braking even now holding them since Jun 10
    Feel much like calling it a day? thks

  24. Phil,
    I just love this comment:
    When you wonder what kind if idiots would be buying 10-year notes at 3% when a gallon of gas was $1.40 ten years ago and now $4 – that idiot is you.
    Yepper…….we vote the idiots in which makes us bigger idiots that them.  We are just the children.

  25. Pharm – any thoughts on BPAX

  26. kwan i am sorry about the caps ting i have an eye issue and use it to enhance my vision..i am pleased that it did motivate what seems to be your lone post yesterday..i’ll try lower case .. im surprised oil not down more…but i guess it depends if they are trying to kill it like silver or just cut out the froth…chilly bluebird day here at my home in north pomfret vt..escaping pollen of connecticut for a week!

  27. Phil question on PUDA looks like they dead no trades bought stock in Jan and played various short calls against it just by instinked I bought a Aug 11 15 p and paid 4.00 now 10.50. What will happen to my long puter as there are no trades? thks

  28. phil extend and pretend…and the market ALWAYS falls for it….the emperor with no clothes..his tailor is back in business!!

  29. Is anybody actually following the trades on the 25K? I see only 35 calls traded on the May 33 TBT today.  

  30. BPAX/goob – my biggest fear with them is adverse events.  Female Sexual Dysfunction is a big market, but treating with a steroid (testosterone) is a bit of a red herring.  Let me look at their data.  For a flier, the Dec 2.5s for 80c are a good risk reward, as IF they fail, they are $1.

  31. Amatta just not every one is a gambler TBT

  32. Phil,
    Would the move on FAS be to roll the May 30′s (now .74) to June 31′s for .52 and partially offset by selling weekly 30′s for .37? 

  33.  From Reuters this AM:The share of investors who said on Monday they were short, or holding fewer Treasuries versus their portfolio benchmarks, rose to 27 percent, up from 21 percent the previous week, J.P. Morgan Securities said

  34. @exec

    Point ‘o Odor!!
    I don’t vote so I wish to be excluded from the Idiocracy.  At least the political one. 

  35. Pharm – I thought they also had some kind of prostate cancer test methods on the come ? I might have them mixed up with others? Thx tho.
    It’s a beautiful day in the neighborhood, suns out , got my rototiller carburetor resolved last nite and gonna till some ground.

  36.  Does it baffle anyone else how AMZN adds about a billion dollars to its market cap everyday on no news? And its already at such crazy valuations…..i just dont understand who’s buying this thing at these levels. And, you would think a 100 billion dollar stock would be harder to manipulate then LULU, et al. Ugh.

  37. gs/ms trading horridly

  38. Out of TNA for $1.60; I think we pause here (R2), or worse !!

    Another view:

  39.  Rainman – if you right click on any image in pretty much any browser, you’ll get a menu that will allow you to open that image in a new tab or window. This allows you to see the original source image at full size.

  40. NYMEX crowd has been rolling early.  Last week is it was 320M in the front month and 235M in July, now 299M in June and 297M in July but still well over 600M in the front 3 months is a recipe for disaster when they get to December, which already has 192M barrels under contract.  This is an accurate chart and notice (on the link) that no one has bought a single barrel of Feb 2014 oil since it was $66.74 – that’s what the "smart money" is doing – staying away from being long on oil!  

    In fact, we’re getting another whack at shorting them below the $102.50 futures line again!  

    Click for chart
    Session   Pr.Day   Options
    Open High Low Last Time Sett Chg Vol   Sett OpInt  
    Jun 11 102.44 102.69 100.12 101.85 May 10, 10:09
    -0.70 105132   102.55 299636   Call Put 
    Jul 11 103.28 103.28 100.68 102.41 May 10, 10:09
    -0.69 29856   103.10 297384   Call Put 
    Aug 11 102.79 103.32 101.08 102.78 May 10, 10:09
    -0.69 15261   103.47 81571   Call Put 
    Sep 11 103.35 103.60 101.39 103.06 May 10, 10:09
    -0.67 10878   103.73 90937   Call Put 

    Wow, Maria and Arnold broke up.  I guess she can’t take the thought of him going back to Hollywood and resuming his usual womanizing again.  

    Dollar back to 74.80 again – they are working hard on knocking it down, spreading rumors that Greece is fixed when it isn’t and that China will "HAVE TO" float their currency because they had a trade surplus this month – as if their goal is to have a deficit…

    RIMM/Kevin – I think long-term they will adjust their product mix and survive.  They made a mistake rushing to answer IPhones and IPads but clearly they have good R&D and good management and great cash flow but they are being priced like they may go BK, with a p/e below 7.  I would not be in such a hurry to roll, just keep your eye on the roll and the relative cost and don’t let it get away from you.  They bottomed out at $42.50 last August but then popped to $70 this Feb so it’s really a matter of sticking with them until they have a good report but, if you roll the putter way out to Jan, you won’t be able to benefit much from a short-term pop and you turn it into much more of a specific targeted trade. 

    HRB/Kinki – Yeah, that’s the usual cycle for them but the 200 dma is way down at $13.75 so no reason they can’t make it another 10% down from here.  You can sell the 2013 $12.50 puts for $2.45 and, if we head lower, you can roll those to 2x the Jan $12.50 puts, now $1.15 when that gets even (if we head lower).  On the long side, the Jan $12.50/15 bull call spread is $1.55 on the $2.50 spread and you can buy 1 and then roll lower and DD if they head down and, if they don’t – you have a net .90 credit on the $2.50 spread that’s in the money.  

    12,750 being tested on the Dow – I think they are too tired to beat it unless oil really pops and gives XOM and CVX some legs but that was yesterday’s game to boost the Dow and they should probably change horses.  I think this should do it so good time to execute rolls and DDs with stops if we punch higher.  

    Weeds/Jrom – Of course it does!  If silver is getting expensive and JPM has $5Bn they want to buy silver with, they mention to some of their friends that it looks like silver is toppy and that brokerages should probably raise margins before they find themselves in deep trouble (brokers PAY JPM to tell them things like this) and, if enough Brokers raise margins then they can put out a bearish public note on silver to help things along and, before you know it, silver is back to $36 from $50 and JPM can buy 139M onces instead of 100M ounces and, if they were clever when they sold the offering, they only allowed for a 10% price fluctuation for the people who put the $5Bn into the fund and they reap the benefits of the 29M bonus ounces.  It’s good to be the king

    Corporate tax rate/Jabob – It’s truly amazing how many reasons they have to run the same talking point over and over and over and over again in that magazine.  Corporate tax rates are high and small businesses pay those high tax rates, which is great for the large businesses, who pay little or none as it keeps the small businesses from competing on an even field.  WMT paid $7.6Bn in taxes on operating income of $106Bn and net income of $26Bn so that’s, at most, a 29% tax rate even if we assume all their deductions, like a $3Bn inventory write-off are all legitimate.   Compare that to ANN, who aren’t that small but made an operating income of $120M and paid $46M in taxes (38%) putting them at a huge disadvantage to WMT right out of the gate.  Get down to the level of Mom and Pop stores and they pay the full boat every time while WMT has an extra $2.5Bn to play with, AT LEAST, which they use to out-advertise, out discount etc. the smaller businesses, serving to enforce their monopoly, driving their tax-paying competition out of business and out of competition for labor, which enables WMT to save even more money by paying people 30% less than local retailers do.  Ah Capitalism….  

    GMCR/Jabob – Did you guys read Sam’s article on their accounting shenanigans?  

    Fired up/Goober – Sometimes I read the news and just get very, very pissed off.  

    Mystery puts/Jasu – What?  

  41.  Phil, you mentioned rolling our shorts to stronger positions this morning. I’m just wondering if I should make any adjustment to my Jun SDS 20/22 spread at this time? I also have a smaller Jun TZA 37/42 spread.  

  42. Phil – me too, plenty to cause that to happen.

  43. @Phil   or Anyone
    I know there are audio alerts for Android cell phones to signal a stock price target being met.
    Are you aware of any "app"  for the Laptop or PC that will allow you to plug in a preset price for a security and than alert you with sound?  

  44.  Phil
    MSFT Jan 2013 20 P for $1.5.

  45. Flip – IB has that available on their trading platform as audio or visual or both and can be used in  mobile

  46.  Jasu – you want to sell the MSFT 2013 puts or buy them? Why either way? Seems like there would be more profitable ways to be both bullish or bearish on MSFT.

  47. Flip – TOS does it as well.  In charts tab, right click on a chart and alert is about 3/4 way down the selection info.

  48. JRW / SPY — Nice chart — the 15 min is quite telling.

  49. BPAX/goob – I don’t see any tests kits in the pipeline, as they are a steroid delivery company.

  50.  Hanna5,
    PUTS. I always sell premium. Seems like 20 is a good place to get them. Collecting premium at times is better than getting dividends.
    If its put to me so be it….

  51. IWM 84.96 is now a floor or it is not; I will play direction off that line

  52. This DX/ES yo yo is brutal, joined at the hip in hyper sensitivity

  53.  Phil, could you put some words around why TBT is good right now given the Dollar/POMO/inflation for the layman like myself?

  54. @Pharmboy & Goober
    Buenos Nachos.

  55. Perception/Goober – That’s a good article.  

    FAS/$25KP, Amatta – Not covering if we hold our 4% levels.  There was a small rejection on XLE at $16.25 so we’ll watch that but we could get a nice pop if the market heads up from here (Dollar has to fail 74.80).  So far, the weekly $30 calls are just .40 and that’s not very exciting – I’d rather sell the May $30s for .75 if that’s all we can get.  

    HRB/DC – They bring this rumor up over and over again on HRB.   Even if you assume that they form a class action and get approved to sue HRB to take the loans back – you are still talking about years of legal actions that would have to end in an unprecedented judgement against HRB that would have to clearly show fraudulent actions on their part and, since they sold these loans in 2007, before the market tanked – it’s going to be very tough going calling for damages when the dumb-asses who bought the paper could have stopped our on losses at any point in the past 4 years and mitigated the vast majority of the damages.  Of course there is the possibility this can go bad – that’s the whole reason HRB (and many financials) is so cheap.   I don’t think you should put all of your money in them but some – sure!  

    NFLX June $220 puts at $5.40 were were $10 last Wednesday.  Those are a fun way to short NFLX.  

    ELNK/Yodi – I think you are lucky to get even.  The 200 dma is $8.45 so you might want to wait for that to test and, if over, make it your stop.  I can see them getting back to $9 but I don’t see a lot of growth for them, although they could probable save a lot of money by cutting back spending and possibly attract a buyer on better cash flows, which is what I would do if I were them as they could justify a pretty good multiple to someone hungry for subscribers.  That’s the only real positive, that they could be sold but management has given no indication that’s the way they want to go.  Keep in mind you can get out at $8.30 and sell the Oct $8 puts for .60 and buy the Oct $8 calls for .70 and the worst that can happen is you are back in at net $8.10 while you actually make another .20 if they just hold $8.30 and get 100% of the upside above that so you don’t miss a thing by pulling your cash back.  

    Idiots/Exec – That must be why American Idiot is so popular on Broadway – those lyrics really hit home.

  56. flip / alerts — I wrote a google spreadsheet that gmail’s you when a target is hit.

  57. Pharm – Fly on the wall put this out this AM and I went there and found a bunch of stuff.
    looks good to me, but ya know I am just a goober………………….and sometimes a tithead .

  58.  Phil,
    When you mention a fun way to short NFLX for June at $220, are you talking about "paying"  $5.40 in premium?

  59.  jasu/ MSFT – fair enough. I usually dont like selling such long dated puts for such little premium. I would rather start with the July 25 or something for 0.70, and then either collect that or roll. If you roll, and MSFT is less then 24.30 in July you will likely be able to get more then 1.50 for the Jan 2012 23 options, and then if you have to roll those, you will likely get even more for the 2013 20s. Meanwhile, best case you collect 70 cents between now and Jan. Rinse, and repeat that, and you will collect $2++ by Jan 2013….But, everyone has a different strategy, so by all means do what you feel comfortable with

  60. Phil
    On HRB I own the stock at 12.75 (not a threat IMO) and the 2012 $15 calls sold. In addition I own the following spread short 2012 $15 calls and long $17.5 2013 calls. My plan is to wait for things to settle and then roll the 2013 $17.50 calls to 2013 $12.50 and then roll the 2012 $15 callers to 2013 for net 0 on the rolls. Is there a better play? Thank you.

  61. Phil – the video is all about PRAVDA.

  62. Back in TNA, btw !!

  63. Phil /HOV
    I have 4000 shares and sold 28x Jan.12  5s Puts and Calls, and 12x Aug 4s Puts and Calls
    What do you recommend to do now,

  64.  Pravda:  Am I missing something? Or is this just an irritating cliche?  Because I cannot glean any useful information from the constant use of this term.

  65. Hello Phil, what is your opinion about EVR (a new conviction buy at GS, but terrible P/E), LEN (a house builder that somehow manages to stay profitable and always beats expectations) and RCL (that is quite low now on oil price concerns, but in fact hedges a significant part of its fuel costs)?

  66. Phil / TrendTrader  — is there supposed to be more than a solicitation on that tab when you click on the see member content link? It seems to be plunking me into a generic signup page.

  67. GMCR – here’s a risk proposal: suppose sam antar and company are right. if so, then perhaps Starbucks, after due diligence, says it’s out of any deal with GMCR.. how hard/far would it fall then?  Can this happen… this week?

  68. 0×0 / pravda — I was wondering if was an acronym since goober always capitalizes it :) I think it’s just goober’s way of expressing what we do here with "the MSM".

  69. PRAVDA  = MSM , no different than Soviet Pravda of circa 1972 or there abouts. Alive and well here in USA.

  70. scottmi
    sam antar writing about even before Starbucks deal. So, I’d guess, Starbucks, after due diligence, said: "We don’t care"

  71. Zero – not intended to be irritating , just the simple truth. If it irritates you then you may need to read some more on the issue or execute your television or both. :)   all the outlets are participants to some degree or the other, depending on their flavor. 

  72. Phil
    What do you think of  
    Chesapeake Energy Corp CHK
    Petrohawk Energy Corp  HK
    Southwestern Energy Co SWN
    Good time to enter or wait ? what levals ?

  73.  hanna5,
    I like your idea of roll-rinse-repeat better. My only concern is that I may lack the dexterity that you possess. I’ll give it the old college try. My way is more set it and forget it variety. Thanks  

  74. Pretty interesting stuff, Antar and Barry and the guy that just got busted. I wonder if the guy that recently pled guilty cut a deal(plea bargained ) for a lesser sentence ?  Personally I ahve read all of them for quite a while.

  75. I don’t own a television, and don’t know what MSM stands for, either.  It sounds like I’m not missing anything.

  76. Goober
    agree on pravda=msm in fact our msm might have improved on the old soviet style to the extent I think most citizens of the USSR knew pravda was spouting BS whereas most AmericanIdolWwatchers (AIW) think alls well!

  77. i had a little chart that i guess i didn’t properly set on its way to you it shows large specs covering shorts and going net long indices last tuesday

  78. Main stream media. I am glad to hear you don’t own TV. I didn’t for a long time either. I thought you were a reader based on some of your responses so was surprised you would be "irritated" as it is just information, nothing more or less.

  79. ireland to impose a 0.06% tax on PRIVATE pensions for the next four years…

  80. Dave – excellent point and what I think Phil is saying today.
    The USD is glued to indxs way more sensitive than previous. I think it surely is part of a new methodology/hyper correlation

  81. 0×0 / MSM — Main Stream Media

  82. Green Day – Just another great Bay Area Band.  Dookie was their "breakout" in 1994, but they were at their best in a club setting, before they were "discovered"….. :)

  83. heres a link to those charts from business insider

  84.  Goob:  I don’t distinguish among media.  A lie contains as much information as the truth.  Both reflect the beliefs of the speaker.  If you know the position of the speaker, you can make valid judgments.  

  85. HUMOR: a guy on cnbc just said he likes msft because "they won’t strike out everytime they are at the plate."…oh man

  86. lots of philospophical constructs..good thing susie sontag isn’t posting (ever again) ck this scary one out

  87. Vision/Angel – You know there are settings for your browser that magnify the text up to 200%?  I use 115% myself as I find it much easier on my eyes staring at text all day.  

    PUDA/Yodi – I have no idea what kind of mess is going on with that one.  This is what happens when you mess with ADRs.  There’s a huge lawsuit something to do with the CEO (Ming Zhao) somehow transferred all the assets to another company he owns and screwed all the PUDA shareholders and now Zhao is somehow trying to make it all go away by arranging some kind of LBO deal to buy the stock out at $12 (mostly his stock so he’s just screwing some new group I suppose).  It’s just a stupid joke of an ADR company and maybe you’ll get paid or maybe you’ll get nothing and, most likely, you won’t even know what happened even after it happened because you threw money into a black box and got a random outcome – this should not be surprising.  If there is any way you can get out with your phantom profits, I’d do it but I see no activity at all in this company other than lawsuits flying back and forth.  

    Markets still strong at noon with 64M traded on the Dow, a bit light but way better than yesterday so far.  On the whole though, we’re only hanging out between the 4% and 5% levels with the NYSE still not even at 4% and no one at 5% so the tug of war still favors the downside until NYSE gets over 8,611 (now 8,523).  

    $25KP/Amatta – You are one of the people who should NOT be trading them.  Those short-term aggressive trades are exactly what you should not be looking for.  

    FAS/$25KP, Amatta – Yes, the idea was to make the roll from May $30 calls to June $41 calls for .40 but time is now working against you as the May calls lose their value much faster than the Junes so you must execute that roll by no later than tomorrow if you intend to stick with it.   As to selling short calls – as I said, I’d rather sell 1/2 a may $30 than the weekly $30s but, unless the 4% levels break – there’s no reason to be bearish at all on FAS. 

    AMZN/Hannah – Well it’s very funny how the whole market seems to add $500Bn (on a $50Tn cap) in a day when there clearly isn’t anywhere near that kind of money coming in.  Of course, marking up the price of things is easy – my kids were going to do a garage sale and they figured they would make at least $5,000 selling their stuff – it was a very harsh lesson in economics for them when they ended up with $200 as things like the bike they were asking $50 for went for $5 and Barbies they thought would get snapped up at $5 each (half price!) didn’t find buyers at $1 etc.  Stocks are no different, $100Bn worth of AMZN has $20Bn held by insiders who paid nothing and another $68Bn is held by institutions who have held it for years – that leaves $12Bn worth of actual stock that is routinely traded on the Greater Fool Theory and if the last guy in decides to pay $250 a share, then everyone gets a 25% pop on paper.  The trick is when T Rowe Price (24M shares) actually tries to find $5Bn worth of buyers to take 5% of the company off their hands.  There may be 5M shares traded a day but it’s mainly Bot churn and suckers buying and selling to each other over and over again – the net of all sales and purchases in a given day is probably less than 500,000 shares one way or the other.  This is one of the things people understand least about the market – how hard it is to really find buyers or sellers for large amounts of stock in short amounts of time – THAT’S when you’ll find out what something is really worth.  

    4 AMZN July $215 calls can be bought for $5.25 ($2,100) and 5 May $205 calls can be sold for $3.10 ($1,550) with the intention of rolling to the June $315s (now $3.10) after they expire, hopefully worthless as that would be over $3,000 collected against the long $2,100.  Good for the $25KP.   

    Very nice call on S&P JRW!  

    Problem/Angel – I would reserve judgement as the Banksters are doing/saying anything to kill Dodd-Frank – hard to say what’s real or not.  

    SDS/Kurt – If we’re not down by the end of the month, then you need to kill or roll but if you roll back now, all you do is make it impossible to profit from the short-term down move we expect and then, once that move is over, I’m going to be bullish and the last thing I’d want is some Q4 bearish spread I can’t get out of.  

    App/Flips – I know TOS does audio alerts if you set them but I’ve never played with it.   You can try it on paper trading even if you don’t have an account.  

    MSFT/Jasu – I assume you mean selling the shorts and yes, I do like that idea unless Steve Ballmer finds a way to clone himself because the only thing that can be worst than Steve Ballmer running that company would be 2 Steve Ballmers running that company!  You may want to let them sell off a bit as they are seriously overpaying for Skype, mainly because management hasn’t go a clue of what to do to look competitive and most likely because they desperately need some new feature in the next version of Windows that isn’t just an update of what they have.  There’s no way they can monetize Skype – the only thing they can do is give it away with windows and amortize it as a development cost and claim victory through sales of windows.  

    TBT/JJ – Because the US needs to borrow $140Bn a month and Japan needs to borrow $100Bn a month and Europe needs to borrow $100Bn a month and local governments need to borrow $20Bn a month and corporations need to borrow $50Bn a month and, after a while, we run out of money and then they all have to bid more interest to pay for it.  That makes the lame old 3.5% 20-year notes less valuable than new notes at 4% or 4.5% or 5% (40% less valuable than a 5% note) and that’s before you even discount the notes for inflation if it turns out not to be as "transient" as Ben would have us believe.  

    NFLX/Csl – Yes, buying the puts as NFLX seems a tad high at $237.  

    Long puts/Hannah – I like doing that with blue-chips.  You can do better with a series of short sells but a lot can be said for "set and forget" trades that just grind out a nice little profit each month as time draws them to a close.  Also, if we do get a sharp dip, you are well buffered compared to a 2-month sale, which then becomes a pain in the ass you have to work out.  If nothing goes wrong for 18 months, THEN you make $2 vs. $1.40 but if something goes wrong, then you maybe make less and, in the past 3 years, something has gone wrong on several occasions!  I’m certainly not saying all one way or the other – just that there should be room for both in a balanced portfolio. 

    HRB/DC – I’d sure pay $2.50 to roll the 2013s down $5, it’s not going to get much better than that and you save $2.50 in margin anyway.  You can do that and sell 1x  the Jan $15 puts for $2 because the 2x $15 calls you already sold are $2.20 so that’s $4.20 off or net $11.60 if you are forced to DD not even counting the other half of the covers and, of course, you can roll the short puts out to the 2013 $12.50 puts, now $2.40, which would net you down to $8.10 and if you don’t REALLY want to DD at $8.10 – why are you in this stock in the first place?

    Pravda/Goober – Actually the Russians were probably better informed by their media than we are.  

    HOV/Tcha – I would do nothing.  The Jan $5 puts and calls are $2.80 which is $1.20 more than your Augs and .30 more than your Jans so, if you roll them all, you lower your basis on the 4,000 shares by about .60 per share (15%?) this year and you still have a call-away at $5 on the whole thing.  Unless you think HOV is NEVER going to go up to $5 (in which case, get out), dropping your basis by 15% a year until they do is a nice way to bank future profits.  

    Pravda/ZZ – It’s the talking points mentality.  Grab a bone and work it over until it’s an unrecognizable mess on the floor and then claim victory – even though there was never an enemy.  You control people so much better by getting them to rely on catch-phrases – that’s why every TV and movie character has them.  Even my oldest daughter comes home from school and says something and goes "that’s my new catch-phrase" – mortifying.  "It’s a beautiful thing – the destruction of words" – Orwell.  

    Finally looks like we’re rolling over, hopefully oil punches back below $102.50 without too much drama.  

    3-year note sale went off pretty well but not great and that’s not what the markets wanted.   TBT should head higher now. 

  88. Zero – Part of the problem is trying to determine or seperate a lie from the truth these days because PRAVDA is so effective and powerful . My comments /perspective on such are simply what is and actually quite apolitical as all are tainted to some degree or another. It is just information and nothing more, but real none the less. Seems to me you are already totally aware of such.  

  89. Phil/25kp:
    You said in your reply to amatta "So far, the weekly $30 calls are just .40 and that’s not very exciting – I’d rather sell the May $30s for .75 if that’s all we can get." 
    Did u mean that we might exit out of our main FAS long position (80 calls May 30 calls) ? Or have we already rolled our long 80 calls to the next month? If so, I missed that update!

  90. Oops.. Ignore my previous question. I just read ur reply.\

  91. SPY sitting on support; we either go up or down from here !!

  92. Its rare the DXY prints a nice long weekly green candle at such depressed levels without further appreciation in coming months.

  93.  LOL JRW it took me a moment to realize that the entire scale on your graph is 3 S&P points. Who knows if we go up or down. but, some strange moves today in the markets. Stocks just seem listless. Lots of rotation. Not many trends. Even high beta names not breaking to new highs. Some signs of a rolling top here, it seems. 

  94. Phil –  Probably true on PRAVDA. When journalism no longer exist’s in a reasonably pure form as a deterrent or source of truth to TPTB , any society is in grave danger of succumbing top the forces of TPTB. And we are there, have been for a long time, but I did not realize it fully until last few years, maybe 10 years for sure 5. Thats why I keep saying what happened to "question authority":  IMO Matt Taibi would be a positive example though.  

  95. Phil / TASR – making a nice run here.  let’s see if it can break out of its range.  i own the stock but have not sold puts or calls.  There is a new TASR rifle on the market and being used by a few police depts. 

  96. "There nothing pure or sure in this world" — apologies to Billy Idol

  97. Pharm / DCTH – nice pop today.  hopefully it resumes its uptrend. 

  98. BPAX/goob – patents on testing can be an idea….not actuality, so whilst they have a patent to test for prostate cancer (or types there of), the price for their stock built for their pipeline IMHO.

  99. EVR/Alik – I don’t know what they have on their books so I couldn’t say.  RCL I like if oil heads lower because hedges don’t last forever (but we like CCL better) and LEN I just don’t trust (HOV is hard enough to stick with) and TOL would be my 2nd choice home builder, not LEN. 

    Trend Trader/Rain – I don’t know what that is or what it’s supposed to be – I’ll have Ilene check it out.  

    GMCR/Scott – I doubt SBUX would care about their bad accounting as long as what they do is clean (although, to some extent, it’s nice to trust your business partner).  What I saw about GMCR this weekend was the new machines they sell are more money ($149 and $179) and one of the "features" is that they have a filter cup and you can put in your own coffee, tea or cocoa without buying the K-cups.  This seems kind of insane but it indicates they are getting pushback, as I expected, on the K-cup pricing and they are trying to cover their tracks by front-loading machine sales revenues to keep the books looking good.  No way would I ever go long on them and I still think, long-term, the shorts will pay off but when is the big question.  They are like FSLR – there’s no real future in them but they are a great tool for the market manipulators to herd the sheeple in and out of constantly generating fees and spread revenues over and over again – who wants to give up on that?  

    Good point Lol – SBUX must have known about the issues.  All they are doing is branding their coffee in K-Cups and selling the machines – not like they are in partnership with GMCR.  

    Irritating/Goober – Anything repeated again and again can get irritating, especially when you use it like it’s some kind of all-encompassing concept that everyone agrees with.  You said "The video is all about PRAVDA" which is not something worth responding to or even reading for that matter and we’re generally here trying to share stock market ideas, not discuss trivialities – especially during a busy trading day – that’s why people find it annoying.  

    CHK/QC – I love them long-term.  HK I’m not too fond of and SWN is a nice long-term play as well.  I’m still waiting for a good sell-off.  Maybe it never comes and then we have to pick individual stocks very carefully but there are always bargains like RIMM and WFR and CSCO are at the moment so I’m not feeling too pressured – especially in the energy sector, which could drop like a rock with oil.  

    Speaking of oil – that was one unsatisfying dip below $102.50, bottoming out at $102.10 with a stop, of course at $102.25.  Once you have a win under your belt in the futures, you can relax a little but still we need to be careful.  At this point though, I’d move the short line up to $103 if we hit that again (Now $102.80).  

    TV/ZZ – Oh I love TV but I’m usually reading a book or playing with my IPad and use it as background. 

    Chart/Angel – You can post links to charts but not the charts themselves.  Those are interesting.  LOL on MSFT – so pathetic.  8% mortgages would be – BAD!  

    FAS/$25KP, Etrad – I mentioned last week that we needed to roll to June $31s for .40 or less.  If you didn’t, it’s no big deal as it’s about .50 now but you must do it soon because all of the May $30 value is premium and that’s fading fast!  So we should be naked in 80 June $31 calls, hoping for a move up to sell 1/2 May $30s into for $1 but, if we don’t get a move up soon, we’ll have to take what we can get just to offset our own premium decay for the next 10 days. 

    Up or Down/JRW – Prescient call as always!  

    Question authority/Goober – That was conditioned out of us since Reagan, right?  Questioning authority brought down Nixon and "THEY" are not going to make that mistake again, which is why Reagan deregulated the media and began the great consolidation that now has us getting 90% of our news from 5 corporations.  

    There’s $103 on oil.  Dollar at 74.89 so you might want to make sure they pop back over 74.90 before taking an oil short.  

    TASR/Terra – Nice!  Still my stock of the decade at $4.60…

  100.  GOOG – seems to me that the new Music initiative (and to a lesser extent the movie/streaming options thro YouTube) are very positive for GOOG given its enormous GMail base. They will start an online Music storage place, that can hopefully be hooked to GMail docs, etc. Its like a one-stop web storage place for everything. And, you can access it all via the Android platform on your mobile device! Yay! (Disclosure : heavily long GOOG). :) ;)

  101. DCTH/terr –

  102. UP/DOWN
    Three trails lead to 85.08!

  103. Phil -
    Did you really mean to eventually roll to the AMZN June $315s in the $25KP as stated, or was that a typo which should have stated $215s?

  104. Pharmboy, I have been watching NSPH since you and Gel discussed it in Feb, note that they filed for an offering at 2.20 today.  I’m toying with getting some here, thoughts?  In Feb, you liked RXII over NSPH, check out their downward spiral, I’ve been waiting to buy the bottom on that RXII but there appears to be no bottom!

  105. hanna

    My point is that if that line breaks, SHORT !!

    On the other hand, it looks to me like the ibanks are the only players today and "they" want it higher !! (SPX 1366)

  106. Vision/Angel
    On MS Windows IE, what I do to quickly adjust my text size is to hold the control key, <CTRL>, while using my mouse wheel to scroll up.  Scrolling up causes text to increase; scrolling down reduces the font size.
    If you have no wheel button on your mouse, you can hold down the <CTRL> key and press the plus <+> or the minus <->

  107. 11:00 AM On the hour: Dow +0.48% to 12,746. 10-yr -0.13%. Euro -0.01% vs. dollar. Crude +0.6% to $103.15. Gold +0.93% to $1,517.30.

    Treasurys stay flat to weak after the Fed buys $6.677B in bonds maturing 2015-2016, of $25.663B offered by dealers: the 10-year yield +0.005 to 3.17%; five-year +0.01 to 1.87%; two-year +0.02 to 0.565%. Still to come: a $32B three-year note auction this afternoon.

    12:00 PM On the hour: Dow +0.39% to 12,734. 10-yr -0.13%. Euro+0.02% vs. dollar. Crude +0.3% to $102.88. Gold +0.86% to $1,516.20.

    01:00 PM On the hour: Dow +0.35% to 12,729. 10-yr -0.23%. Euro+0.04% vs. dollar. Crude +0.12% to $102.68. Gold +0.85% to $1,516.00.

    The Treasury sells $32B in three-year notes at 1% even (.pdf). Bid-to-cover ratio of 3.29, vs. a recent 3.12; indirect bidders take 32.7%, vs. a recent 33.8%. Direct bidders take 15.4%, vs. a recent 11.9%. 

    Treasurys are still moderately lower after three-year debt sells at the lowest yield of the year; 30-year yields are +0.015 to 4.33%; 10-year +0.02 to 3.18%; five-year +0.025 to 1.88%; two-year +0.02 to 0.57%. 

    The EIA cuts its summer gasoline forecast to an average of $3.81/gallon (peaking in June) from last month’s $3.86 – all substantially higher than a year-ago $2.76/gallon. 

    An FDIC proposal sets margin requirements at 2% for retail forex investors dealing in major currencies, and 5% for other currencies – an attempt at more strict oversight in a fraud-heavy market. The plan is similar to a CFTC rule from last fall and doesn’t affect large companies in derivatives and swaps markets.

    The sovereign debt market sees a margin hike of its own. Responding to the growing spread to German paper, LCH hikes marginrequirements on Portuguese debt from 35% to 45% of the underlying value

    A senior Greek government official denies an earlier report that a new EU/IMF bailout package is set to be inked. "Greece is not holding any discussion on any new aid package." Sigh.

    In contrast with a recent surveys from the NFIB, Fed Gov. Duke says economic conditions and credit availability are getting better for small businesses. "Anecdotal evidence leads me to believe that conditions are improving." 

    Richmond Fed President Jeffrey Lacker: We’re coming to the high-water mark for stimulus with the end of QE2. The job market’s headed the right way, but hikes may come before a full healing. Housing and consumer spending are to blame for the recovery’s weakness.

    There’s not much insider buying going on ($1.2M, vs. $650M in sales).

    Once again 6.66 comes up:  With BarCap’s high-yield corporate bond index yield slipping to 6.66% – lowest on record - has there ever been a better time for a junk-rated company to borrow? And they’re doing it: A record amount of bonds have moved so far this year. Great for the market, if things don’t overheat. 

    Three lunchtime reads:
    1) How they failed to catch Madoff
    2) Should long-term investors buy or sell this market?
    3) The quality of muddling 

  108. Resistance on IWM 85.23 then 85.61, fwiw.

  109. mrm – I have really been trying to zero in on our plays in Phase 2 and Phase 3.  The RXII and NSPH are still a bit out of my comfort zone still, but RNAi could be a wave of the future, esp. in ocular diseases.  NSPH platform is interesting, but they need someone like GenProbe to come in and help them move things along.  For a small position in NSPH, fine, but RXII can be just watched for now. 


    PLX is still in the doldrums, although their ‘drug’ works and was a replacement for Genzyme when they had manufacturing problems.  SPPI just getting clobbered, and VVUS is up to $8 on what?  MDVN at $24 on what?  Short interest in MDVN is very high, so most likely a short squeeze.

  110. There’s that number again
    Store-closing announcements declined 36% in the first quarter, with Borders Group Inc. (BGPIQ), Charming Shoppes Inc. (CHRS) and BCBG Max Azria Group Inc.’s Max Rave representing 37% of the total, according to a joint report of ICSC Research and PNC Real Estate Research.
    Retailers disclosed plans to close 1,791 locations, down from 2,806 a year earlier. The tally represents U.S.-based establishments’ publicly reported store closings.
    The count consist of 1,636 general merchandise, apparel, furniture and other--what are known as GAFO-type--stores, 107 grocery stores, and 48 restaurants.
    Borders, Charming Shoppes and Max Rave have reported a combined total of 666 store closings. Changing technology has severely affected brick-and-mortar bookstores, resulting in the bookstore segment leading all segments in the amount of space to be vacated, the report said.
    Big Lots Inc. (BIG) is closing a large number of stores in the first quarter, though it also expects to open a significant number, which would result in a net gain of 45 locations.

  111. dsheara thanks v much! btw i dont thnink the market has yet grasped that nothing happening on greece til june at the merkel

  112. Hanna/ GOOG,

    How are you playing Google long. I got burned when it crashed after the last earnings but want to get into a good upside play again.


  113. Wow, oil is rockin’ and rollin’ but at least it didn’t tease us pretending to fail our lines.  Massive pump up into NYMEX close (2:35) and inventories tomorrow morning not likely to support $104 so good time to hit USO puts with the May $41 puts now .95. 

  114. Phil – I could not disagree more with PRAVDA as a triviality. It is likely the single most insidious negative source of power we all face. I will elaborate/retort AHs Seems yo me a civil conversation partially filling a non eventful day thta you participated in as well ??  MIxed messages ?

  115. Phil / USO

    Agreed, 61.8% retracement exactly !!

  116. Phil do you like YPF?

  117. Anybody looking at STEC for earnings  getting close ?

  118. Phil, is the GLD Jan bull call spread still the way to go to play bullish on gold? thanks!

  119.  If you think the news is bad on the East Coast, check this out, we are all doomed:

  120. If "they" can’t get this done today, I suspect that "they" will gap up over tomorrow !!

  121.  rehat – i am in stock (50%), 2012 400 LEAPS (25%) and 2012 500 LEAPS (25%) and for extra, some June 550 calls i bought when goog was near 530. If it can fill back up to 580 or so, i will cover both the 400 and 500 leaps with from month calls (by about 1/2). They are very money intensive positions, but i have allocated a large portion of my portfolio to GOOG at these levels (~25-30%). I think it is the best combination of value and growth to be had among large cap tech.  

  122. TM – what popped Toyota today? it can’t be just a press release about a hydrogen station.

  123. every day the stick reappears ~~2-245

  124. Scott –  Nikkei improved overnite after neumerous days of down,probably some of it if not all ?

  125. Wow. are we really gonna end with a triple digit gain today?

  126. jabo / stick – 2 and 2:30 are quite popular. Depends if it was a 2 or 3 martini lunch.

  127. Got out of ES , skimmed a bit today and done. I think a pattern is forming. Yesterday I moved too many times and accomplished little, today I stayed long and improved considerably . Just watching DX/ES 

  128. Phil – FAS question: I have the May 31 long calls, not rolled yet. and sold the May 31s for .58c now .35. As you said, cost to roll is a bit over .50c. Any sense in doing the roll now then holding the call to expiration to pay for it?

  129.  HUGE reversal in RIMM. heavy call buying in May and June. Just picked up some short term RIMM calls. Will see what to do with them by the EOD. 

  130. will this market ever have a correction?

  131. Thanks hanna

  132. Phil thanks for the nice words on PUDA still my question is will some one honor the long puts or not?
    AMZN play high steak on margin over 13500 on PM

  133. CSCO is going all guns today!!! feeding frency

  134. Getting ready to bail TNA at a cross of the 8EMA or IWM 85.50-61

  135. JRW very clear move!!! on TNA

  136.  Phil / SKX
    what do you think about them at this level? are you still bullish?

  137. JRW: re TZA/TNA -  It seems that both move quickly when an inflection point is breached, so I was curious as to usual slippage, when you execute with a market order.  How many tics away is your fill from the breakout point, on average?
    Also, have you found better fills with a particular broker?

  138. CSCO / Yodi – If you study the last 4 earnings cycle you will see that they drop right after earnings and slowly make up part o that drop before earnings again. I guess in between they get picked up by "value" investors until the next bad earnings. I think that there is value there, but earnings are tomorrow and that is one company in dire need of good news. Tempting to play on the upside because I am sure they know that one more bad cycle would lead people to lose patience with them.

  139. GOOG/Hannah – I have been waiting and waiting for them to monetize YouTube.  Something like 200M hits a day and they barely do anything with it.  I say no ads in front of the video but ads on the sides of the page would make it much nicer.  They are going after NFLX with movies and no doubt they are working on getting a music service to rival ITunes – as long as they are smart enough not to spend their own money on it (AAPL doesn’t) – I think its all net positive for them long-term.  

    Meanwhile, I think phone vendors are making a terrible mistake.  If you go to the T store or VZ or one of those mall kiosks that sell phones or BBY even – none of them FEATURE the IPhone.  That’s kind of silly since it’s over 1/3 of all phone sales so all they end up doing is driving people to the AAPL store, where they can buy VZ or T contracts right in the store and walk out with a working phone and a great experience.   If they go back to the AAPL store for service – that’s where they really cement the relationship compared to the cattle drive that passes for customer service at your average phone company store.  Supermarkets and 7-11s learned this long ago – you don’t bring any customers in the door by hiding the Coke and pushing your store brands – you need to give the people what they want and build a relationship – that’s the exact opposite of what the phone stores are doing and Android may go the way of the Zoon and the other Walkmen if they don’t get their acts together. 

    AMZN/$25KP – Sorry, that was the June $215s, not $315s, which are cheaper but have prohibitive margin requirements!  

    Dollar slapped back down to 74.80 again but every time they hold it, that resistance line gets to be stronger support.  Still it’s a market booster timed for the stick so be careful if you are short!  

    Closings/Kustomz – Funny when you start noticing it.  

    Pravda/Goob – You are missing the point.  It’s the overuse of Pravda, not the concept of the MSM we are complaining about.  The MSM in America is not like Pravda in Russia because that was a communist party NEWSPAPER (not TV, no radio and people had to subscribe to it so circulation topped out at 11M) with no pretense of independence.  Izvestia is more like what you are thinking of – that was the official government paper but it served the state interests, not the interests of big business so it too really has nothing at all to do with the MSM.  So, in short – it’s just plain wrong to shout PRAVDA over and over again as if it makes some kind of point.  I just did a Word search, you’ve said Pravda over 20 times since 4/20 – that’s kind of a lot and it’s surprising it’s taken this long for someone to call you out on it but I guess we all were hoping you’d get tired of it.  

    YPF/Kustomz – Yes, they’ve been very good and steady with the dividends (8.5%) since ’08.  I like them better closer to $40, where they were on Friday so I think I’d wait for oil to sell off but you can sell an Oct $45 put for $4 to make sure you’re not missing anything while you wait.  Ideally, if you can get the stock and the Oct $45 combo down to $40 or less, then you’re in for net $36/40.50, which is a nice overall entry.  

    STEC/Goober – I’m not too keen on paying chip companies high multiples at the moment.  If they mis-step their projected 20% growth rate by even a hair – down they go. 

    GLD/Step – Yep, that one still works.  

    LOL Rustle – that is so true about LA news!  South Park did it better though…  

    TM/Scott – Wow!  TheStreet (they do ratings now) upgraded them but I had no idea people took them seriously.  THE POWER OF CRAMER COMPELS YOU!!!

    Triple digits/Hanna – Yep, crazy is as crazy does apparently.  Dollar was slammed all the way down to 74.70 to give us that pop – we’ll see if they can keep it below 74.80.  RUT right at our 856 line – first one to hit the 5% mark (as usual). 

    FAS/Morx – That works but keep a reasonable stop on at least half in case we get a big pop off this strong finish.  

    Correction/Jabob – I think we just had as much of a correction as they are willing to allow.

    PUDA/Yodi – I don’t know, they may get bought out at $12 (doubtful) or they may go to zero and, in theory, your broker will make good on it at expiration.  As I said, if you can find some sucker to give you $9-10 now – be happy with cash.  

    We’re at goal (20%) on TBT but not too crazy to hold tomorrow with a big 10-year auction coming up.  Don’t forget – today’s auction was "very good" and we got a pop.  Imagine what will happen if we get a poor auction..

  140. tchayipov
    SKX that stock is a dead horse ! shoes are way overpriced and loosing wheight is just a gimmic!

  141. JR

    Just out of curiosity. How do you predict what “they” want to get done? You’ve been pretty much dead on in your predictions the last few weeks.

  142.  phil- I have the may 41 USO puts.  Is it worth it to cover with say weekly 40 P overnight or go naked into the inventories tomorrow?

  143. 8800 / fills

    My fills are immediate and the spread of the fills is tight as I place them in thirds (smaller is better)

  144. I think it’s time to make some changes to the system…. 

  145. Phil Thanks again on PUDA I am offering to sell the stock for 6.00 no takers (suckers)

  146. phil-- do you still think we have a litrtle sell-off this week?

  147. All out of TNA now for $1.30; getting ready to short !!


    exec / predictions

    I bought Carnac’s turban at auction       8-)

  148.  Phil – you gonna keep a short bias into tonight with China Inflation data? Should come in a little strong, and hopefully cause some overnight weakness. 

  149. Great run on DB started yesterday to buy at 60.55 after they dropped over 5.00 good B/w play

  150. SKX/Tcha – This is where we DO like them (below $20).  They missed on the 28th by about 20% and that was miles off last year’s earnings for Q1 but revenues were strong.  I think we went over it in detail at the time.  Anyway, I certainly like put selling as an entry here.  The July $18 puts can be sold for $1.15 and the Jan $17.50 puts are a better deal as they can be sold for $2.30, for a net $15.20 entry and TOS says $3 in net margin to make $2.30 (76.66%) if they hold $17.50 for 8 months – that’s a pretty good ROI!  

    Poor RUT rejected at 858!  

    USO/JJ – Next week, I assume?  I have a lot of faith in the Dollar and oil is up on BS fears of refinery shutdowns from Mississippi River flooding.  Not that it won’t flood but that we’re operating at 84% capacity now so there’s a 1/6 chance that a refinery that gets flooded wasn’t producing anyway!  So, river abating, dollar rising or demand shrinking can all smack oil back down off it’s $9, 3-day recovery and the 50 dma is at $106 so I don’t think oil is going to run away on us – all reasons I don’t mind holding naked but, of course, it’s a very risky trade any time you touch a commodity.  

    Presidency/StJ – That’s about the best most of these idiots can hope for:  

  151. Talking about Pravda (truth)…
    Yesterday was what the Americans call VE, and the rest of the civilized world simply calls the Victory Day.  That’s the day when the Russians with the help of the allies (Americans and the Brits) finished beating the sh.t out of the Nazi scum.  Exactly in that order.  
    How much info have the american kids been given in their history lessons at school about the role the Soviet Union played in WWII, besides the favorite Stalin and Hitler couldn’t agree on how to divide up Europe and they went to war with each other?    What percentage of americans who grew up during the times of Cold War actually knows that the Russian lost 27 million lives in that war, or that Russian soldiers liberated Auswitz and many other death camps?  
    Pravda may have been a propaganda tool of the Soviets but in many respects it’s no different than ABC, CBS, NBC were at the time or FOX news is today.  Just a different spin…

  152. Presidency/StJ
    I see no one makes any comments on Donald Trump ??? speaks with a clear tongh

  153. exec / JRW:  well, ‘they’ sure are having to spend a few coins to get their finish!  85.50 is being hotly contested in IWM.  Someone is dummmmmping.  Of course, volume today, across the board, is pathetic so they can afford it.  Somehow.

  154. Stewart’s commentary on Ron Paul saying the right things is priceless.  

    Sell-off/Jabob – Yes because I still think Europe is nowhere near fixing Greece and that’s going to blow up by the weekend.

    Short/Hanna – Yep, burned like this we need to just wait to give up if those 5% lines get crossed.  

    3:00 PM On the hour: Dow +0.62% to 12763. 10-yr -0.31%. Euro +0.24%vs. dollar. Crude +1.27% to $103.85. Gold +0.91% to $1516.90.

    U.S. home prices in March declined for the eighth month in a row, according to CoreLogic’s Home Price Index. National home prices, including distressed sales, tumbled 7.5% Y/Y, and are now 4.6% below the previous post-bubble low set in March 2009; excluding distressed sales, prices slipped 0.96% Y/Y.

    Rail carloads fell 0.2% in April, the first year-on-year decline in 14 months, following 10% growth rates as recently as December. "Rail traffic deserves a close watch over the next several months because it’s a useful gauge of the strength of the economy," AAR’s John Gray says.

    Dollar Kryptonite:  The White House takes a dim view of John Boehner’s demand for trillions in spending cuts: "It is simply irresponsible to declare that you will tank the U.S. economy if you don’t get what you want." Tying the debate over the debt limit to budget cuts would be tantamount to holding the economy "hostage," spokesman Jay Carney says.

    Last week’s commodities rout did not reflect changing fundamentals, but was the result of a perfect mix of profit-taking, margin calls, and temporary dollar strength, says Keith Fitzgerald. One to two years from now, prices will be higher. Buy the dip. 

    Irish FinMin Michael Noonan announces a cut in the VAT, a program to upgrade the nation’s roadways, and the creation of jobs program. How does a broke country finance such measures … by going after pensions, which will be taxed to raise nearly €2B over 4 years.

    This week’s IPad Killer Alert!  Dow Jones’ Ian Sherr says Hewlett-Packard’s (HPQ +1.4%) new entry into the tablet wars, the TouchPad, "breaks ground" because it is "designed to help users communicate, to keep in touch. It can receive phone calls and text messages… [It will] play animations and videos created using Adobe’s (ADBE) Flash technology," tasks the iPad (AAPL) can’t handle.

    Microsoft’s (MSFT) $8.5B bid for Skype was more than double the $4B offered by 2nd place Google (GOOG), according to TechCrunch. It’s possible the Google offer wasn’t even serious, but just a gambit to get MS to pony up more. Rumors of Facebook interest were surely such a ploy. 

    Nomura unveils its inaugural list of 10 "conviction buy" U.S. stocks it’s most confident will outperform the broader market during the next 12 months: CVCDOVGSLTDMARMXIMNWSAPETMPNC,VIA

    That list can be bought tonight and I bet most of them pop tomorrow as Nomura carries a lot of weight in Asia.  No one here is paying attention

  155.  I’m grateful to any little sell off at the end in this market.

  156. uggh!!  This political stuff on this board is really driving me crazy (from both sides).  Probably not going to renew in July…its starting to get a bit intolerable.

  157. Did CSCO release bad news early or is someone just dumping them ahead of earnings?

  158. leonf, Soviet Union wiht Hitler started WWII, and 27 million lost Soviet Union, not russians, its different. All East Europe suffered in slavery 50 years after this. Pravda was official newspaper Communist Party and truth they wrote very rare.

  159. GOOG/Phil:
    "Supermarkets and 7-11s learned this long ago – you don’t bring any customers in the door by hiding the Coke and pushing your store brands – you need to give the people what they want and build a relationship – that’s the exact opposite of what the phone stores are doing and Android may go the way of the Zoon and the other Walkmen if they don’t get their acts together. "
    In Japan, almost all stores have extremely polite and attentive service, rendering Apple’s renowned "Genius" in-store service somewhat moot.  I am thinking in the case of Japan, and perhaps other countries where customer service is not top in priority,  "price/performance" is still the big deciding factor, IMHO.
    2009 Japan Smartphone share (Apple #1 at 72.7% of all smartphones sold):
    2010 Japan Smartphone OS share (Android: 57.4%, iOS 37.8%):
    The organic, and bottom-up approach of Android development is, by its very nature, causing it to evolve very rapidly.  I don’t know how they monetize it, but its going to eat into the iOS share, and in the end, it might come down to deciding if you want to buy the coolest phone/tablet or the coolest platform.  Its all going to come down to the apps.

  160. yodi
    The Donald is a first class jurk!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

  161. WWII / Leon – I think that you point out at the problem directly, there was no real appetite to credit Stalin for anything at the end of the war given his attitude before the war and shortly after. I am sure that not many Russian kids know much about how Poland was treated in 1940 and 1945 by Stalin! And Stalin would not give much credit to the Allies either for the Lend-Lease operations that delivered 2/3 of the Red Army’s trucks at the end of the war. History is just a victim of politics! And that continues today when you watch Fox….

  162. yodi
    First class only because it is his plane!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

  163. say it ain’t so Jo….I need you here!

  164. shadowfax
    what better have you got???

  165. Hey jomama,
    Agree 100%

  166. jomama, I am totally agree with you, same feelings here. Its traders site or not. More good trade ideas like Gels SIMO at 4 dollars in autumn and political debate after hours please!

  167. >>and political debate after hours please
    Even better – on weekends

  168. Better than 3% on the day; however, at this rate, it will take me two weeks to make enough to buy the new station wagon my wife wants !!


  169.  vic/jomama/pahurik – i agree totally as well. many people make one or two off the cuff political remarks. but with hundreds of users, these couple remarks really clutter the board. 

  170. Oh Phil,
    Did you not get the Sure trade of the day – Short CSCO – It’s earnings day… :-)
    Let’s see what happens in 10 minutes but I am still with you and in the Long plays you gave 2 months ago – the 2012P 2013 BCS spreads

  171. On politics – They should be kept to weekends, I don’t even want it after hours during the week.   We will have an ignore button shortly so you can simply ignore people who don’t say anything you want to hear.  That’s my best plan for keeping politics off the site.  Obviously, politics does affect the markets so we can never ignore it completely.  Just today, it was Boehner who knocked the buck down from the 75 line (now 74.73) and set off the rally so you can love him or hate him depending on whether he screwed you or helped you but the bottom line is that only a fool would ignore him. 

    RUT up 1.5% on the day, half a point over the Nas and the Transports, who are once again inexplicably flying higher on rising oil prices.   Laggers were S&P, SOX and Dow – all up about half a point.  VIX dropped 7% to 15.92 and Dow volume was a lame 155M. 

    Price/performance/Kinki – Good point, not every country has commoditized retail the way we have and that does negate AAPL’s advantage in many places.  Still, my IPad crashed yesterday (well the App crashed, the IPad was fine) and I rebooted it for the first time in a couple of months.  That is not at all the case with Androids and even at this moment my own desktop is telling me it’s out of virtual memory and I should shut down while I can’t even remember the last time I restarted my IMac.  People have different expectations for phones than they do for PCs – they expect them to work all the time.  Fortunately, for AAPL, people are used to dropped calls whereas if they were dropping web connections at home people would go nuts.  The thing about AAPL Apps at the moment is they represent a tremendous, generic market for developers – android has to match that and the entire AAPL user experience, which they have fine-turned with a decade of ITunes.  

    At the close: Dow +0.61% to 12762. S&P +0.82% to 1357. Nasdaq +1.01% to 2872.
    Treasurys: 30-year -0.6%. 10-yr -0.37%. 5-yr -0.27%.
    Commodities: Crude +0.84% to $103.41. Gold -0.02% to $1516.60.
    Currencies: Euro +0.25% vs. dollar. Yen -0.61%. Pound -0.3%.

    Market recap: Stocks finished near session highs as Microsoft’s deal for Skype boosted hopes for further consolidation among tech companies. Corporate earnings continue to surprise on the upside; today, it was DF and WEN. Oil futures closed near $104 and gasoline surged 3%, as flooding along the Mississippi River threatened to cut supplies. NYSE advancers led decliners three to one. 

    The U.S., through its IMF support, is the 4th largest individualcontributor to the EU bailouts. For the most part, U.S. policymakers have publicly stayed out of the debate, but, with that much in the pot, there can be little question their influence is major

    Molycorp (MCP): Q1 EPS of $0.01 misses by $0.09. Revenue of $26.3M (+770% Y/Y) misses by $15.4M. Shares +0.3% AH. (PR)

    DIS disappointed, down about 2.5% on light film revenues (down 13%).  

    CSCO/Rehat – Nope, I like them and, if they get cheaper, I’ll like them more.  

  172. JRW – More power to you. Keep the economy going, and get thrills out of it also..
    Your levels and trades are greatly appreciated. Thank you.

  173.  Wow. Miss on DIS. Should be good for DIA puts tomorrow, tho dont wanna party too early

  174. Phil, I was a little perplexed selling the TBT 25KP from this morning as I thought that the 25KP had a longer hold time?

  175. Two weeks JRW….LOL. I have to wait until my annual bonus ONCE per year…haha.

  176. stjeanluc – i completely agree with your points.

  177. DIS is a good pick-up on the dip.  $42.50 should hold.

    TBT/RPMe – I could have sworn I said that it was holdable, didn’t I?  Still, it was a quick $300 if you take a .30 gain off the table and if you make $300 on 200 trading days a year that’s $60,000 so I guess you can worry about the hold time and roll the dice rather than sensibly take profits every time you have a good trade but I’m still going to call out what a sensible way to play something would be.  The number one problem I see with Members is that they don’t take profits.  Most people have learned how to deal with losses but many don’t deal with PROFITS and end up dealing with a lot of losses – that’s not good!  

  178. JRW, don’t you have access to the Fed window yet?  Just increase your leverage.  Mama wants a new ride!

  179. World / Phil – Phil, I am no economist and don’t know much about macro-economy, but it seems that no one does know what is going on anymore and that it the source of our problems. For example, we assume that low rates and easy money will lead to inflation, but yet, Japan has been on that path for 20 years now and are dealing with deflation even with a debt load over 200% of GDP (they might have a special situation with 90% of the debt owned domestically). Our bond market is pricing for low inflation for years to come (rightly or wrongly). In Europe, they can’t figure what level rates will help or hurt and how to deal with the "lost" money lent to insolvent states.
    There was a good quote from Wolfgang Munchau of the FT on that subject "Europe’s political elites are afraid to tell a truth that economic historians have known forever: that a monetary union without a political union is simply not viable. This is not a debt crisis. This is a political crisis. The eurozone will soon face the choice between an unimaginable step forward to political union or an equally unimaginable step back," 
    In the meantime, emerging countries with higher rates, stronger currencies and no debt are facing inflation (China, India, Brazil). I think that one of the issues is that we usually face inflation on 2 fronts – wage and resources. Clearly resources (oil, gold and others) are inflating, but globalization has led to wage inflation export from countries like the US and Western Europe to emerging countries like China. Wages inflation is almost inexistent in the Western countries but rampant in emerging countries. With competition from lower wages abroad, US companies can keep pressure on wages here. The same is true in Europe where large companies delocalize to Eastern Europe for lower wages. So it is possible that missing that wage inflation component might be enough to keep a lid on long term overall inflation here and in Europe. This was a missing component in the hyperinflation world of Germany before WWII for example. Or Zimbabwe today. But who knows.
    The issue is that no one, Bernanke, Trichet, the BOJ or the BOC in China has the answer. I am convinced that they all know that their models (all of them) are flawed or too complex. But they all know that with combined economies of $40 trillion (or 60% of the world GDP),US, Europe and Japan can’t be allowed to slide. A 10% slide in these 3 is almost the size of the Chinese economy! So full speed ahead with nowhere to go.

  180. pahurik – WWII wasn’t started by Soviet Union.   27 million Soviet people…  makes me smile… 
    Yes, there were 27 million Soviet people who died so you could make uneducated assertions about who started the war.
    WWII was the last chapter of WWI which was a debt-driven division of spheres of influence amongst the superpowers of the day.   Soviet Union took place of the Russian Empire,  Nazi Germany took place of Germany prior to WWI, France fell in 3 seconds, and England and USA remain as major players and are as much to blame for the escalation and  continuation of WWI into WWII as the former 2 powers.   The US actually benefited the most from the war and the subsequent Bretton Woods currency setup.   So going by what the logic of the Roman law, it’s the US who should be blamed then…  I am just sayin…

  181. STEC – And down they do go!  

    A motion for Finland to support the bailout of Portugal comes close, but has not yet garnered the majority necessary. With 12 affirmative votes in hand, Finland’s Grand Committee needs one more ‘yea’ to give the EU its nod, a virtual certainty at this point.

  182. pahurik/jomama, 100% agreed here. BTW, I miss gel1.  He was a great contributor here.

  183. Phil, my issue is I have a lot of things going on and try to structure my day around my trading. That means my day looks much different if everything is a hold versus day trades, regardless how much they run in price. Thus, my question on 25kp being a longer term hold.

  184. leonf, you dont know histroy at all. WWII started then Hitler and Soviet Union attacked accordin Molotov-Ribbendorf pact secret agreement Poland. After this Soviet Union also occupated Baltic States, Bessarabia and attacked Finland.

  185. Phil:

    The thing about AAPL Apps at the moment is they represent a tremendous, generic market for developers – android has to match that and the entire AAPL user experience, which they have fine-turned with a decade of ITunes.
    I agree. In the now classic "Cathedral and Bazaar" analogy of software development, AAPL is that shining, orderly, authoritarian "Cathedral" and GOOG is the dirty, amorphous, headless "Bazaar".  Just looking at the market share data, it amazes me that GOOG has managed to secure that large of a share with their upstart little side-project  against the Cathedral with Jobs at the head of the Papacy. 
    Its my personal bias, but when I am looking for that sudden punctuated leap in evolution, that appearance of the proverbial "Black Swan", I look for it to emerge from that messy Bazaar, and it might just leave AAPL scrambling — especially if the Pope dies.  But Android is just one facet of GOOG, so just a little fun speculation, hehe.  Thanks for listening.

  186. OK,
    WWII, Pravda, ……
    I wonder how many Russians are on the PSW?

  187. Phil -  Still disagree as  I consider PRAVDA simply a eupahmism for the entities you defined (MSM/Pravda/Investia) I have replaced those other terms in my vocabulary with PRAVDA and yes it is a generality but a completely valid one IMO. So what if I used the word Pravda 20 times since 4/20 ???  I could word search you and others and come to the same conclusions on numerous words as well and it would mean nothing ( Bush/republican/democrat/conservatives) except your point of view or persuasion ? So I discount all that as pooh ( 20 times since 4/20 is not many considering all the posts in that time IMO). Today you were intermingling in the conversation and in my mind nobody was out of bounds in anything and you even agreed with what was being said about Pravda vs MSM. Then all of a sudden you find it necessary to attempt another slap down via humiliation or inferred negative when no real negative/offense has occurred. So I don’t get the real underlying reasoning here as other people agreed with not only what I said but others as well in regard to PRAVDA. Is it wrong to acknowledge what is real? Or better to simply say it as it is ? It is clear many here also agree with my point of view  not only on this but other issues as well . So I am confused by your responses some times. Today I was actually going to post something very close to this "Phil we are agreeing to much, stop it ! " and then another slap down attempt ?  To me if you go back and read today and for all those who were present I see mixed signals or something I am not sure what it is. Maybe you simply do not want to acknowledge a conserver making sense? I really don’t know at times, but I think you do yourself a disservice when you act this way for all to see. Becasue it really does not make any sense at all given the dialogue today? To me there is NO negative whatsoever, only imagined,  in the use of the term PRAVDA for I have accepted its entities /purposes/reality as a force against us all and simply use it as a catch all described above. I have been using it this way for a long time and see many others doing the same in different media formats as well now. The slap downs make you look dictatorial and or schizo? Something to ponder. I think PRAVDA is in fact a very real and very serious entity for all to be keenly aware of and acknowledge as I have now defined from my perspective which I believe to be quite mainstream now actually . So because you have the bully pulpit, captive audience that justifies non-sense at times ? Just saying I am at least consistant and not sure I always find that same trait. Kinda maybe sorta but not exactly. Other ideas and points of view are a good thing. It is becoming more and more apparent why some have come out of woodwork and said "I am leaving and you will need a thick skin" and other such comments. I think you might do well to rethink some stuff as the word PRAVDA is quite harmless and no damage is done in any way via its use especially by a person who explains his reasonings as I have on numerous occasions after the attempted slapdowns. Is this America or Russia, come on lighten up and let go of whatever it is ?         

  188. goober,
    Paragraphs are your friend ;) .

  189. STEC posted decent #s and it seems guidance killed them. Glad I did not go there. The earnings seem nearly impossible to play given responses from analyst and talking heads pushing direction after the fact these days.
    I learned this the hard way of course as we all do with most things.

  190. Scot – I am not trying to be divisive or anything else. Simply stating what I think is real and reasonable based on my experiences and reading/understanding of the world we all live in. I consider your comment a compliment and or tacet agreement or something like that. Good luck to all, that is my real sentiment ! I think sometimes those in places of power get caught up in it and lose sight at all levels. Just as simple as that so please dont’ add anyhting else to it, just be with it.  

  191. pahurik,  please… you didn’t tell me anything I didn’t know  about Bessarabias (a part of Moldova) and Poland.  Do me a favor and at least read wikipedia before engaging in quoting the history lessons cause it seems like asking you to read more advanced materials about WWI and WWII would be premature.   Start here, I guess to learn more Chamberlain and his policies and betrayal of Poland.  
    My point was that regardless of how WWII got triggered it was nothing more than a rematch/closure of what started as WWI and it wasn’t just Soviet Union and Germany who were behind that war or who stood to benefit from the war.  I guess it’s too complex of a concept for you.  I guess, I am sorry about that.
    Also, I hope you are successful enough as a trader so that you have time and resources to  read more which I am sure will lead you to booking a flight to Russia one day so that you could visit one of the battle sites, say Volograd (former Stalingrad).  There you can go to the Mamayev Kurgan memorial and drop on your knees paying respect to the fallen Soviet soldiers because of whom you can sit here, trade options in the comfort of your home and blabber away your non-sensical asserts in English instead of in Deutsch.

  192. Goober- It should be apparant to you by now that Phil is a liberal extremist. He has a few on this site (noses placed in appropriate positions)  that will agree with anything his holiness spouts off (You know who they are already).  If you disagree with his (or their) positon on politics you can (and will) be shut down (just ask Flip). I initially subscribed for the trading dialogue and quickly realized I got this special "bonus". Trashing anyone with a differing opinion than Phil is business as usual. It’s not worth it to me, so as mentioned previously, I’m out of here after current subscription expires(probably sooner once the PSW police shut down my comments).

  193. @Felipe
    Indulge me for a moment…… trust many of your instincts on the financial calls you make, the politics is another story,and more than likely you actually believe this statement, but is it true?  Is Boehner’s statement correlative or causative?
    :….Just today, it was Boehner who knocked the buck down from the 75 line (now 74.73) and set off the rally…"
    I fail to see how you determine that of all the things going on in the world that you can pinpoint exactly what knocked a measly (in today’s currency world fluctuations) temporary 27 cents of the FRN. 
    I’d love to know how you divine this thing.

  194. leonf, I live 25 years in Soviet Union, winners write histrory but i understand that you not learn in school scientific communism and Lenin and Stalin books. All east europe live 50 years slavery and may be you have different opinion if you family killed by Soviet Union or sent to Sibir with childrens. But ok, people who have not lived in Soviet Union dontd understand that system it was.

  195. Goober – i dont want to put words in Phils mouth, or anyones. And, i’m gonna generalize to others here. My issue is not with politics (actually, i may agree with much of what you say), but with posts that add nothing to my trading/investing. 

    We all have to remember this is a trading community. Go look at Opts page. Just randomly choosing from OptTrader Tab at 1:40 pm, we had

    1. Opt posting that he was getting out of a WYNN short
    2. English answered with 11 stocks he thought were good short candidates
    3. Opt and I mentioned that RIMM was bouncing hard and there was call buying
    4. English countering that he thought Put and Call buying in RIMM was equal, and it was just bouncing to the 5DMA. 

    The next several posts were all Opt suggesting short or long candidates and others commenting. I just think that sometimes you have to go through many more posts over here to glean that kind of information. YOU are all great traders, and our best resource. Would love to see everyone posting once a day on some stock that they really like or on something that they are watching closely that we may not see on our screens. 

    I did TONS of due diligence into MGM a couple weeks back, and went heavily long (posted here). Same recently with GOOG. There is no reason for you to replicate my work. Iflan here used to help us with AAPL, and JRW posts his trades constantly. Yet, almost NONE of their posts were just random chatting. This is how we build a great trading community. 

  196. Wow, my response to Goober has been moderated! This is not surprising. The PSW police at work. Any differing opinion will be moderated. Thanks Phil. Let me state this more gently. This site leans severely to the left in it’s politics. If you have a differing opinion you will be shutdown,moderated etc…I suggest you avoid political discussion and tolerate their onesided viewpoints or go elsewhere.

  197.  Amazing with earnings from DIS, MCP, and STEC that this is a runaway positive market. 

  198.  Hanna5
    Well said – time during the day should be for trading & investing, and little politics, and even less history. While I appreciate both subjects, and agree that there may be effects on the markets, those are generally somewhat muted.
    For trade ideas, how about ADM, small but growing dividend, slightly beat up the past few days, it will be around no matter what, and Sep puts can be sold for $2, with nice adjustments & leaps available if needed. Nice inflation hedge if we go that way.

  199. In case you’re not following PSW on facebook yet, we need more fans.  Why?  Well, we’re hoping we can generate some interesting discussions over there on various articles.  Please go here and click on "like".  Thanks!

  200. pahurik, this makes me even more sad if you lived in the Soviet Union and still can’t distinguish between the truth and Cold War commercials.   You want to add a personal touch to this arguement, be my guest.    2 of my grandfather’s sisters are burried somewhere in Baby Yar (heard of it?), killed by Germans and their local Ukrainian collaborators.  My grandfather at the age of 16 lied about his age (added 3 years), joined the Soviet infrantry and fought as a private and later an junior officer, having been wound 8 times, having gone through the battles of Stalingrad and Kursk (heard of these?), stormed Visla river, joined with American troops at Elba and wasone of the first soldiers to climb the rood of Reichstag.   After the war, he suffered from the subtle and often no so subtle antisemitism, hated the communists and their propaganda and as all normal people saw through the stupid propaganda and couldn’t wait for the non-sense to end because the system just didn’t work.  But never for a second did he equate the Soviet Union to Germany.   Nowhere will you find an equivalent of Baby Yar or Auswitz left behind by the Soviet Army as it marched through Eastern Europe.  So shame on you for not being proud of what the people of your former homeland have done to save the world from the fascists.

  201. Today’s levels.

  202. …JAKESTER: i am new to posting..i make a living trading for a family office…but i am wondering what ‘being moderated means?’ do you mean there is a site censor…is it stylisitc censoring or substantive…it’s clear that phil does have a political lilt but i am quite sure that the site’s liberalism would disallow a red pen outside of truly inflammatory hideous stuff…i have lately thought i would stop posting simply because i then have to read every post to keep a reasonable tethering to the thread of thinking..and that sir phil colonel goober and a few others do raise issue thats might be construed as soft proselytizing…and once a bomb is dropped it does get fractious…i believe this site has the potential to become a constructive force..didactic and tinged with a meaningful level of reciprocity…maybe we should avoid our own biases and talking our poliical book while we attempt to gain an edge on a highly manipulated beast..and with an election year bearing downon us it could really get effed up around here.(.i have subscribed for i think nearly a year so i am not a total rookie btw)…thoughts?

  203. leonf, Soviet Union killed 10 times more own people and East Europe people then germans. Soviet Union send to friend Hitler raw materials and learn him how built contsentration camps (Soviet Union have … camps 15 years before Hitler) Soviet Union tell 50 years, that germans killed thousands Poland people in Katyn, but today we know truth.  Hitler never attack Poland and  without Soviet friends support. But enough, I understand, what you totally blinded and discussion with you does make sense. Case closed for me.

  204. You know, it would be handy to have a thread here at PSW called "outside." That way, when people get into a passionate discussion about something that isn’t financial / trading related, we can go "hey, take it outside!" Just a thought.

  205. I taped google Soviet Union+killed people and first was this site.  Must read…..

  206. Pahurik, you are Polish in more ways than one. We won. Case closed. Moving on.

  207. Angel- I , like yourself, rarely post and have been a member for a year. I prefer to read the comments and attempt to extract meaningful information from what is supposed to be a trading site.  Personally, I feel the political statements should be banned as I find much of it childish on both sides. This is a trading forum and I suspect Phil hopefully has realizes he has likely lost a share of customers for the same reasons I have pointed out because he is typically the guy leading the charge but is quick to shiut down opinions differing from his own. Let’s stick to trading.

  208. thanks jake..everyone has passion (if they are lucky) phil is also growing a business here so our feedback is meaningful…especially  if its constructive…jakester thanks for the reply i appreciate it!

  209. Some trade ideas:


    GILD looks like it wants to roll over.  Going to watch tomorrow, but a short should be coming on them.  Very ugly chart.


    ITMN is losing one of its biggest owners……too bad.  Their drug sucks, but it is the only game in town for IPF.


    FRX is getting ripe for a short.  DOJ is looking into them…..


    EXEL – well, I looked into their flagship and their phase 2 trial data are due out in June ’11 and Dec ’11 (approx).  The phase 3 data are not due until Dec ’13, so I don’t see any reason to jump on them at the moment.  The trend is down, and any hiccup, and $5-7 they go.  For gambling money, I would almost buy a cheap P and C every month (like May 12 C and 10 P for 10c each towards OPEX).  They could pay off handsomely. 


    INO – I told MrM that I would look into them.  INO is a vaccine delivery company using electroporation (electricity) to deliver vaccines for HPV, Wilms (leukemia) and other diseases.  The technology is interesting and not my area of expertise, but the 4 trials they have ongoing, only one needs to show a hint of something (especially the leukemia one).  As a buy and forget about, they could be worth a few hundred shares.  I like GHTB, CRIS and others better.  As a swing back to the 1.10 though, I could go in on a few shares! The stock price filled the gap.

  210. We are mostly agreed that PSW is a trading site.  Yet we would also agree that politics and markets are related.
    I would distinguish between political opinions and ideology.  Phil invariably connects his political opinions, ideologically populist or whatever they are, to how he thinks market will react.  But some members interpret that as an opportunity to push ideological positions unrelated to making money.  There are an awful lot of blogs you can use for that.
    The point is to be correct about market dynamics, no matter what political filter you use to arrive at the correct conclusion. But to the extent PSW is used purely as a forum to get political rocks off, the politics become pointless.
    Here’s an example of a politic view without ideology [without at all suggesting my conclusions are correct]:
    I keep watching U.S. real estate tank, a slide that has continued unabated for at least three years.  The banks sit with the crippled mortgages.  The Fed bails and re-bails out the banks.  Many borrowers sit tight in underwater houses [worth less than the mortgage] and pay nothing.  Lawyers have, unsurprisingly, found enough legal fault with the average mortgage document to tie up the house in court for a decade.  This is clearly damaging the economy.  Yet there has been no defined path — which requires political decisions — toward a general solution.
    In my misspent youth I used to structure financial products for Wall Street.  Yeah, I know.  But if I were doing it today, I would view the above-described real estate mess as fresh meat.  Complain all you like about "securitization", but it turns illiquid assets into bite-sized, price-able, tradable products.  I submit that, not only it is what the real estate market needs, but that politically, it is what must inevitably happen.  No choice, other than sooner or later.
    How?  The Fed "buys" all the underwater mortgages from the banks.  They have already, in effect.  The Fed hires Goldman, MS, JPM, and UBS [boo, hiss]  to review, grade and sort them — by region, by price, by category, by net indebtedness — whatever.  Then they market them — shove them into ETFs, or underwrite private offering tranches to sell to all the foreign central banks stuck with useless and depreciating dollars and let them buy up all the underwater houses.  Whatever.  There’s always an appetite for tradable product — imagine being able to target your investment at the city, region, price point, age, or type of U.S. real estate.  The U.S. would indemnify buyers against fraud, implicitly, since the U.S. Fed is the seller, subject to all those tough securities laws we have.
    What does the Fed get?  It gets paid back X cents on a dollar.  It might even make a profit, depending on timing, dollar levels, or international appetite for cheap U.S. real estate with rental or general flight of capital potential. Gaddafi will probably buy out entire private placements.  Sure, it constitutes the "selling of America", converting the U.S. homeowning class into permanent renters.  So what — they can’t take the damned things back to China!
    My point is not that it "should" happen — that’s ideological.  Rather I am suggesting politically that it will happen, because it is the path of the least resistance.  Oh, there will be lots of ideological howling, but the U.S. is in no financial condition to get nationalistic about who owns the America’s housing stock. And it won’t, if the economy starts to recover, which it probably would.
    Political, not ideological, comment welcome. 
     So I keep wondering — how does this end?  Because I’m pretty sure that there will be no normal, whether new normal or otherwise, until millions of overpriced houses and the paper that burdens them is sorted out somehow.

  211.  Move last paragraph 5 paragraphs up, sorry.

  212. zerozero…that was like santana transitioning form gypsy queen to oye como va! schweet!

  213. Leonf675
    Interesting viewpoint. "Pahurik, you are Polish in more ways than one. We won. Case closed." To the victor go the spoils?
    No doubt the Soviet people paid an enormous price during the war. But for Eastern Europe replacing one dictator for another was not something to celebrate. Ten years of one or fifty of another, both terrible options. Herr Hitler or Comrade Stalin, two of histories biggest mass murders. We know about Hitler’s because we (ALL) destroyed him, Mr. Stalin’s worst gets to remain secret as he changed teams and became part of the winning side.  

  214. lets just keep those sharp sticks poking one another in the broadening….like stepping on a rake..weeee…being a greek i suppose i should start getting into some anarchistic rants now and again…but forst..ouzo!

  215.  Phil, I don’t post much and usually just ask a few questions.  Try to do my own research and use your hedging techniques and levels to manage an ever changing market.  I would like to suggest an absolute moratorium on political rhetoric and particularly the voicing of individual opinions.  Reporting that Boehner says he is going to require a gazillion in spending cuts to sign off on an increase in the debt ceiling does have market repercussions which should be discussed.  That should be the focus of the comments, not judging his position.  It is truly unfortunate that bright and imaginative people leave the site over the frustrations created by emotionally charged political exchanges.  I count on this site for insight on market direction – period.  And what sets this site apart is that it has things for people trading everyday and for people like me who would love to never make another trade except to protect against downturns.  Won’t happen because I find myself wrong more than I am right and thus have to shift gears.  If we could channel the energy and intellect into investment ideas we would all be better off – particularly guys like me!

  216. perfect tradinv1 thank you!

  217. Politics / Zero – I was going to make a similar comment. Investing in a political vacuum would be like driving with your eyes closed. Like it or not, people like Bernanke and Trichet are political animals and their actions are political in nature and should be discussed. There is a reason why the Financial Times and the WSJ have a great deal of political articles. For the same reason, large investment banks pay tons of money to political consultants. Trying to separate ideology from politics is very difficult as any comment can be widely interpreted (I should know!).
    Phil, in general, I think that some of us enjoy the broad discussion of this site and others would rather see only trading related comments. We are all adults and we can make choices. There are some trading related comments that I find to be of little value (I don’t day trade for example so TNA and TZA comments are useless to me, seeing questions about what to do if your position is down 50% or if you have a double is not very relevant since I already know your answer having seen it hundreds of times) but they have value to other members so I respect it. So I skim these comments and move to the interesting ones. There is much to be learned. This is what a community is – I might not be great friend with all my neighbors but we share a neighborhood and respect each other. 
    BTW, some members mentioned missing Gel and he did have some good insights on currencies, but he never shied away from the political barb himself and I recall some good back and forth between him and Phil!

  218. stjeahluc
    the key words in your statement are – some of us.
    I bet that 95% of of PSW members are happily browsing through ALL Phil’s comments related to trading but same 95% are having very hard time trying to swallow political wrangling. I fully agree with tradeinv1 on how political events should be discussed – not opinions but facts and where they may lead to.
    It is great that your trading skils are so high that you can spend most of your time on political discussions, not me, I’m here to learn how to trade/invest and the time Phil spends reading political posts and then answering could be better spend on the main subject. And there is a very simple solution for people who can’t leave without politics – find a political blog.

  219. Speaking of GOOG, a fascinating story describing the time GOOG considered buying Skype but thought against it:
    Why Google Does Not Own Skype
    But, according to Chan, halfway through the deck, Brin seized the floor “and started getting really negative.” “He asked a series of questions that he knew would get unsatisfactory answers. Is this purchase data-driven? Who is going to spend all those months commuting to Europe? (No one stepped up.) How long is the government review expected to take? As Chan had figured, the advocates of the deal were unprepared to respond to these last-minute objections.
    Chan then described the climatic moment. “[Sergey] looks at me and says, ‘Why would I want this risk? We have a team capable of building the carrier, we have the users, we have hundreds of millions of Gmail users, why do we need to have Skype?’ And at that point, Sergey gets up and says, ‘This is the dumbest shit I’ve ever seen.’ And Eric gets up and walks out of the room, and I’m like, okay, the deal’s off.” And it was.

  220. Complexity/StJ – Well there was a time where a man could have 1,000 books and that was pretty much all the knowledge in the World.  Even when we were kids, the Encyclopedia was pretty much the sum total of all human knowledge.  Since then, things have gotten quite a bit more complex and, even worse, now all the countries intermingle, where they used to just trade and that sets off a whole new dynamic and now you have to understand the mindset of a Salaryman in Japan as well as a Chinese mobster, a ruthless dictator, a Swiss Banker etc, who are your co-investors and you also need a fair background in the workings of the Central Banking systems around the World, the politics of other countries’ Governments as well as our own as well as the workings of Corporations and their boards and the designs of HFT programs and a hundred other things we never used to worry about when investing used to be about whether or not a company could make a desirable product at a reasonable profit.  

    The World has become a very complex place but I think if you embrace and accept the unknowable, you can concentrate on those things you do know and make a bit of money along the way.  I think the biggest problem with politicians, economists, etc is that they actually do believe they know it all.  I read constantly and I can never read enough – as we said, there’s too much to know – but when I go to a conference I just don’t feel I get enough out of it because time is wasted traveling, eating, sleeping and even playing golf.  Then I look at a guys like Cramer etc and what is he doing – he’s making appearances and going to parties and getting photographed in the Hamptons – no wonder he’s clueless.  Most investment people are no different and the "celebrity" ones are the worst – they pretty much only know what they knew before they became famous and now they are out of date because there’s just no way they can keep up – even assuming they wanted to read other people’s opinions, which most of these guys do not.  

    So that’s a factor too – even the "experts" only know what they know until they stopped learning.  In medicine and law, you have to keep up with the latest changes or you can be sued for malpractice or simply lose all your clients but there is no malpractice in economics, which is why Keynes said:  

    The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.

    Too large a proportion of recent "mathematical" economics are mere concoctions, as imprecise as the initial assumptions they rest on, which allow the author to lose sight of the complexities and interdependencies of the real world in a maze of pretentious and unhelpful symbols.

    Russia/Whoever cares – Actually way back in early 1935, Russia wrote a treaty of mutual assistance with France (Franco-Soviet pact) but the League of Nations wasn’t comfortable with it and essentially made it useless with changes, leaving France without adequate ground defenses they had counted on from Russian support.  So Europe and the US slapped Stalin in the face in 1935 when he sought to ally with them to contain Hitler, who had become Chancellor in 1933.  People knew he was a nut-case, he had tried to overthrow the Government in 1923 and was ousted and 10 years later they put him in charge – global opinion of Germany was not too high…

    Of course you are never told this kind of thing in America because Joe Stalin is the devil and he couldn’t have ever been anything else, right?  Germany allied first with Italy and they were arming rebels in the Spanish Civil War, supporting Franco while Russia supported the Spanish Government.  Meanwhile Japan was invading Russia, China and the Pacific Islands and no one in the US or Europe lifted a finger to help any of them.   By 1939, Germany had "annexed" Austria, Czechoslovakia, Hungary and Poland, almost without firing a shot and Italy took over Albania and by the summer of 39, Stalin signed a non-aggression pact with Germany JUST LIKE EUROPE DID – hoping he would stop without it all going to war. 

    A year later, in Sept 1939, France and the UK (which was a big global commonwealth at the time) declared war on Germany.  Russia invaded Poland, in large part to use it as a buffer between them and the advancing German army that was rolling over Poland anyway.  Russia was really hurting for ports and first requested Finland allow them to harbor their fleet there and, when Finland said no, Russia said screw you and took over the country.  Had they not done that, Germany would have controlled the North Sea and England almost certainly would have fallen.  Nonetheless, France and the UK saw it as an act of aggression by Russia and they were thrown out of the League of Nations – which is where the vilification of Russia began. 

    Russia never allied with Germany, they simply had a series of non-aggression pacts which was great for Russia as they took over the Baltics while Europe was busy dealing with Germany and, thank goodness for all of us – built up a war machine that was capable of standing up to the German armies, who were cutting through Europe like a hot knife through butter.  France fell in the Summer of 1940 and the US, who had been helping Europe and China run blockades, was actively at war with Germany in the sea in the Summer of 1941 – another fact you will never see in a US history book because the official story is we were minding our own business when we were attacked by Japan.  The fact is Japan was at war with China, was blockading Hong Kong and the US Navy, which staged out of Pearl Harbor (and the fleet was only moved there from San Diego that year – an aggressive move) was running the blockade and firing on Japanese ships and, in the summer of 1941, we embargoed Japan’s oil – which Japan considered a declaration of war since it was crippling them in the middle of their war with China.  THEN they attacked us!  

    Meanwhile, Stalin begged Churchill and Roosevelt to invade France in 1941 and 1942 but DDay was not until June of 1944 and, while Russia waited for 2 years for the US and the UK to help them, as Leon notes, 27M Russians were slaughtered by Germany.  

    Meanwhile, over in Europe, Germany had taken everything but England and Russia and were concentrating their forces on both boarders (the "Russian Front") with the first official invasion of Russia in June 1941.  The fact that the US had sat by the whole time and let this happen to Europe was truly amazing – this is how close we came to an unopposed Nazi Europe and Hitler’s dream of a 1,000-year Reich:  

    File:Second world war europe 1941-1942 map en.png

    If not for the brilliant tenacity of Churchill and the incredible luck of a killingly cold winter in Russia that stopped the Germans outside of Moscow in November of 1941.  That gave Russia time to mobilize their forces (all their equipment was designed to work in sub-zero temps) and go back on the offensive in December, before Germany could re-supply.  So, to say Russia was allied with Germany in WWII is pretty far off the mark – they signed the same BS treaties with Germany the rest of Europe did and Germany broke them 5 minutes later, just as they did with everyone else.  

    I think the saddest thing about reading a lot about Wars is how little we’ve learned as a planet from them.  We do the same stupid crap now we did back then sadly. 

  221.  Excellent exposition, Phil, thank you.
    I guess it’s a good thing that Germany was ultimately defeated; otherwise they might have become the dominant power in Western Europe for generations. :)

  222. Structure/Rpme – Well I’d say avoid playing anything with less than a full month to expiration as those are the ones most likely to be taken off quickly if they make money.  I don’t intend to make a day trade usually but, if you make 20% in a day, the chance that you will make 400% for the month or 5,000% for the year is pretty slim so, as a rule of thumb – it is prudent to take the money and run since your trade is outperforming pretty much everything but lottery tickets.  

    Cathedral and Bazaar/Kinki – I like that analogy although, by that logic, Linux should rule the World by now.  

    Pravda/Goober – That’s fine, it’s yours, you own it and we know that you say it with pride.  Perhaps we can all chip in and get you a ribbon…  8-)

    Boehner/Flips – The man says something at 9:58 and the dollar dives at 10, the moment it hits the wire.  I guess neither you nor he have any idea how sensitive the markets are to the debt ceiling discussions so we’ll just say that Boehner is an irresponsible jackass and not that he’s purposely timing his statements to manipulate market outcomes.  Just a big coincidence, move along..

    Russia/Pahurik – Of course they were bastards but you need to take a step back and look at the war from their point of view.  I know that’s very difficult if you or your family were actually assaulted by Russian troops – mine were shoved onto German trains and thrown into gas chambers – makes it very hard to see Germany’s side of the story but I do my best because it’s really impossible to get a full view of history without reading all sides of the story.  Stalin is a very hard guy to defend but had he not cracked heads and industrialized Russia after WWI or had he not put down the Red Army to keep Russia unified in the late 30s, they would have quickly fallen to Germany and I very much doubt the Germans would have treated Eastern Europe any better than Stalin did.  Objectively, Stalin wanted to form a European Alliance that included Russia – he was soundly rejected.  It’s very possible that that mistake by the League of Nations made WWII possible – it certainly made Joe Stalin a bitter man in an isolated nation. 

    Moderated/Jake – Yes, we have moderators who intercept your post and decide to hold it within a tenth of a second of you submitting the comment.  Or, possibly, you say enough words to make your comment sound like an advertisement or a solicitation and the spam bot intercepts it.  Whatever explanation feeds your paranoia or bloats your sense of self-importance (whichever) is the one you should go with I suppose.  Yes, I am a "liberal" for lack of a better word and, if you don’t like that – you are free to go find some more conservative investing site or at least one where they would rather lie to their members and pretend they are neutral rather than have honest discussions for fear of offending people.  Meanwhile, this is where I choose to be and I will openly discuss my opinion because my opinion on politics does come into play when I make my investing decisions and people who tell you otherwise are lying but, if you are a conservative, I guess you prefer to be lied to anyway.  

    ADM/Deano – On 5/2 they first dipped and we liked the Jan $30/June $37 spread at net $6.45, selling the Jan $35 puts for $2.60 to net $3.85 on the $7 spread.  That spread is now $4.70 and the puts are $4.10 so down to net .60 already!  I still like the concept but now you can buy the 2013 $30s for $6.20 and sell the Sept $34s for $1.70 and sell the 2013 $30 puts for $3.50 for net $1 on the spread and worst case is you own them for net $31.  

    Outside/Elliot – That’s what Caps site is for but no one ever goes there.  I’ll be happy to get an ignore button – we should have a top 10 list so we know who is ignored by the most people!  8-)

    Stalin/Pahurik – Not my field of expertise but it seems to me that Stalin took power in 1924 and there were 147M people in the Soviet Union at the time, in 1940 there were 191M and in 1950 there were 181M so 10M people lost and maybe some growth that didn’t happen is a far cry from 60M people killed by Stalin.  Again, I’m not trying to say the guy was a saint or anything but when people toss around numbers like that it’s pretty clear they don’t understand math (or politics, as killing close to 50% of the population is generally frowned upon, even in Dictatorships).  

    Houses/ZZ – Interesting idea.   I’m pretty sure the main plan is to inflate us out of debt.  That, of course, can turn into disaster very quickly. 

    LOL Angel!  

    Moratoriam/Trad – And who will keep the gate?  How do we run chat when every comment is held for review as a panel decides if it’s "good" political discussion or "bad"?  As someone mentioned above the very idea of censorship goes against my liberal sensibilities but then I read some of the crap in this discussion and I’m all for censoring it all.  I think the ignore is a good solution because I will also ignore anyone who doesn’t have a trading question and you guys can each decide for yourself if someone like Jake has anything worthwhile to say that would make it worth putting up with the political rants or whether you want Goober to educate you as to the true meaning of Pravda.  I find it very sad that some people hear Boehner and automatically assume it’s a political statement.  When I criticize Geithner or Bernanke or Obama, that’s market analysis but if I say Boehner caused a problem – I’m showing my liberal colors?  Well, what can you do?  I call them as I see them and nobody likes the umpire.  

    Also, by the way, I fault the people who do sit silently waiting for trade ideas and bring nothing to the table.  If the only people who participate are the ones who want to talk politics, then the site leans political but if more people would add to the conversation on the trading side – then the days would be filled with trading discussions.  That should be obvious enough but Jake says "I don’t talk all year except to complain about what people talk about" and you agree with him as if that’s some kind of virtue.  It seems to me that there are about 10 people we can ignore and there would be no politics on this site – Matt says he expects to have something done by the end of the month so we’ll find out then…

  223. LOL StJ – Yeah, we sure showed them!  8-)

  224. " another fact you will never see in a US history book because the official story is we were minding our own business when we were attacked by Japan."
    Perhaps you are referring to the revisions made to the more recent politically correct history versions. As a kid, we were instructed on Roosevelt’s "scheming" to find an excuse to enter the European war officially. Along came Japan/Pearl Harbor and game on. 
    I always found it odd that the initial war effort was focussed on Europe when the it was the Japanese actually were first to attack. Many reasons given for this but, just one of those questions I always wished I could ask directly of the perpetrators. 

  225.  And thanks, Angel –  ya, take it down and chill for a few licks.

  226. A trade idea: I have traded a June 520/500 Bull put spread a few times this month. I load up when i can sell the 520′s and buy the 500′s for a credit of 5 and close it out on a day like today for 3. May have a chance again tomorrow since Goog just took a charge for justice dept stuff.

  227. Phil, thank you for conveying the message I failed to communicate here about WW2.  It’s truly sad to see the point  about propaganda getting diluted by side-shows of those who till nowadays think that life under Hitler  wouldn’t be much worse than what happened to Eastern Europe after it became a part of the "East".    My main point was that the word "pravda" is overused and in actuality propaganda was pervasive on both sides of the cold war.  stjeanluke somehow got my point.   As an example, I used the misinformation about the role Soviet people/soldiers played in winning the most horrible war this planet has experienced to date.   27 million is greater than the population of Texas. Hopefully, we never even come close to comprehending what this actually means.   
    Doro, I realize Stalin was a dictator and was probably evil.  I am not fan of communism as I think it’s a utopian ideology. I understand Stalin’s regime oppressed and killed millions of his own people (not 42 million as suggested by the idiotic source pahurik dug up so proudly, but still millions of innocent lives were taken by his regime).  BUT..  I also realize that the Soviets DID NOT put supremacy of one race over all others at the cornerstone of their philosophy and that’s why I can’t accept when people equate Soviet Union to the Nazi Germany.   
    I know that if Hitler won the war my people, the jews, would not be around and perhaps pahurik doesn’t see an issue with this, but I do.   To me the army that liberated Auswitz is the army of heroes.    So when I see morons like pahurik (sorry I mean it as a diagnosis and not as an insult) try to equate the Nazi to the Soviets,  it gets me sick.  
    You make it sound like Stalin switched sides after having watched  the fight on the sidelines.  It’s actually more descriptive of the behavior that the US engaged in during that war.   Germany invaded USSR on June 22 1941.   D-Day was on June 6, 1944.   3 years in between is when most of the fighting on the Eastern front happened.   It’s when millions of lives were lost,  it’s when the Germans came within a few killometers of Moscow and kept Leningrad under seige for close to 900 days, etc.. etc.  Sure Lend-Lease was invaluable, but does is it the same as putting millions of lives on the line?
    Again, my point was that the american kids don’t know most of this.   They mostly get taught the non-sense that pahurik is spitting out "Russians and Germans were allies at first, and then they went to war with each other.  Americans and the Brits came in and kicked everyone’s asses and liberated the poor gay French and all other Europeans.  Stalin killed more people than Hitler, but we landed on the Moon and made enough jeans and bubble gum to cause the Soviet regime to collapse". 
    Again, my main point was about propaganda and importance of trying to understand the opposite point of view.  Something that people like pahurik would no nothing about. 
    Anyway, enough said.   Let’s celebrate the Victory Date, our victory day, and move on!  Please.

  228.  Phil
    I’m impressed of your knowledge of Russian history :)
    I found that people in US think that they won WW2 and even don’t mention Russia who lost in that war more than 30 mln people
    and they even don’t know that US and UK started second front (start actively fight with Germany in 1944 when Russian army was already in Poland (couple of hundred miles from Berlin), and only reason they started it because they already understood that Germany lost and afraided that Europe will be converted to commy regime if they didn’t start from the west at safe at least half of it
    But at the same time Russia wont survive without help of US  with food and weapons in 41-44 (not for free)

  229.  Leon:  All true, but the French were both slavish and gay in that war, enthusiastic partisans in the extermination of French citizens.  Denmark and the Netherlands, ostensibly more "Germanic" countries, were exemplary by way of contrast.

  230. Phil,
    Unfortunately you are a little bit off about Stalin and Hitler, however FORTUNATLY you can use your own advice about never stopping to learn.
    After fall of communism some documents were discovered in archives and confirmed old rumors. Stalin and Hitler did have pact to divide Poland.
    Actually Stalin expected the war and was preparing to strike first, however Hitler managed to pre-empt him. Stalin started to move army from defensive positions, preparing for attack and it make army significantly more vulnerable.
    In fact USSR won the war not because of Stalin, rather in spite of him. Constantly scared about plots to overthrow him (possible with reason) he almost completely destroyed officer corp. People who argued for new strategy of using tanks instead of horses were vilified and executed.
    Only after several weeks of war he realized that defense should be managed by professionals and returned some survived officers from GULAG.
    And don’t forget about “zagran otriad”. When they put machine-guns behind soldiers, some of them without weapons (former political prisoners were sent to front line without weapons. They were supposed to capture weapons during the battle). So when you have machineguns behind you, even though you have 1% survival chance going forward and attacking without weapons – you have 0% survival rate if you retreat.)
    All I want to say, you have to honor Soviet people for this war. But very little of this honor should go to Stalin himself.
    However completely I agree with you, that role of USSR in that war is completely misrepresented in American textbooks

  231. lolkha,  I agree with all your points except for may be you could’ve gone a little lighter on Phil :)

  232. IMO all above comments have merit. Jakester, I knew when I came here there was a left leaning bias, but I must say I also knew Phil is a man of integrity even though he sometimes spouts off himself as he accuses others of same, but hey its his site !  I will  not bore you with how I know this, please just accept that I do. When I said I have thick skin, I was not at all bragging or in any way saying anything except those simple words. Early in my entry here I clearly stated that I am different person than most because my previous life experiences are quite different than most and that is simply a fact which nobody can change by any means and or political bent. I could expose more of my "adventures" but deliberately choose not to because I know it would inflame intense diatribe agasinst me, not because I would deserve it , but simply because others have not experienced certain things in life at the same levels I have and some of it has been horrific by the standards of many. I am sure I have thrown my more right leaning brethren a few curve balls as well so I offer this. Please consider that all politicians are basicly looking out for themselves and use the masses as fuel for their own fires. Also my strong feelings on PRAVDA are not really a very political leaning issue. I hope some of my theories made sense as all forces use it to control and disseminate what they choose and nothing else. It has become a force to be used to control thoughts and opinions whether true or based in fact doesn’t even come close to mattering. It is a form of mind control.  I consider this extremely dangerous. Anyway I will continue to take all advice and comments into my posting practices and personally I think the dialogue here tonite is quite healthy, so no harm no foul. I greatly appreciate all of your comments and I imagine Phil does as well. I am still looking around all the different avenues and finding more information everyday as Hanna suggests, but it is a lot of stuff, of which I am glad ! I swear I am not trying to be divisive, simply calling things as I see them. Many times I have bit my tongue for a greater purpose, and I think tonites dialogue proves that point well as a lot of thinking and expression of ideas/thoughts has taken place instead of accusatory diatribe or political bent.
    Angel not sure what colonel mcgoobs is or isn’t but I have chuckled and smiled to myself , so thanx. This is the kind of levity we need more of. Lots of very smart people here and that is a good thing.
    I could not agree more with Phils closing statement above. Been there and done that and it is always the same. A great man, Ike,  tried to warn us of what was to come and he was part of the very machine he spoke of and in my own way I am of the same opinions and experience, just a different time frame and far lesser stage . I seriously hope all will consider that the politicians are nearly all criminals that foster what Ike was talking about and have not served us well and are the source of much of our problems if not nearly all, for many reasons. The flavors don’t really matter. I wish all well and good luck in all things.  
    Lastly, Fred Hayek said, "The curios task of economics is to demonstrate to men how little they really know about what they imagine they can design". …………….Incredibly prophetic today 
    Caught a salmon tonite finally ! Although pretty beat up and a little dark, on the grill tomorrow nite and smoke with apple wood . They are coming and I am ready.        

  233. Don’t want no stinking ribbons or badges !

  234. leonf675
    I believe Phil doesn’t take it all personally :)
    BTW Soviet solders weren’t all "warm and cozy". There were enough atrocities against general population  (not only Germans, including numerous gang rapes. Although sometimes authorities cracked on it. But generally although it was not encouraged, it wasn’t really frowned upon. Conquered town was given to solders for the first day to "release the pressure" ) 
    any history is really so NOT BLACK and WHITE.
    That’s actually what annoys me in all politic discussions here, that almost everybody (including Phil) often over-simplifies the picture.
    (and I can see point in almost every view voiced here, and I can argue against any of them as well)

  235. Very good doc. film Maybe can download or buy dvd.

  236. I like that analogy although, by that logic, Linux should rule the World by now. 
    Phil:  Its funny you say that.  Android is based off of Linux, so it may very well get its day in the sun. 
    I agree Linux, despite its functionality and stability, is not a major player in the consumer OS market, because I don’t think it was ever meant to be. But certain other Open Source projects like Apache Web Server and Mozilla Firefox have come to dominate their respective markets.
    Until now, I had looked at Android as another "experiment" out of Google Labs – like Google TV. But the gain in market share has been so eye-opening that it forces me to take them seriously.  We all know no product, no matter how good, can be successful without good management and marketing, so it depends on how Google manages to herd the development into a combined final product.   But if "cloud computing" is the future no company is more entrenched than Google, so they definitely have a head start in that aspect.
    Hey in the end, a little competition is great for us the consumer and they are both great companies, so its fun to root for both and watch how they one up each other. 

  237. @Felipe
    "….so we’ll just say that Boehner is an irresponsible jackass and not that he’s purposely timing his statements to manipulate market outcomes.  Just a big coincidence…."
    No THAT I can buy. 
    It helps to possess the level of paranoia about the right that you possess.  It certainly can’t hurt. 
    But you sound like the talking heads who, every day, say some specific thing is responsible for a move rather than coincidental with it and they don’t know what they’re talking about either.

  238. …and for the trade idea (and personal practice)  to keep it somewhat germane to the real purpose of being here, I wonder how many have been taking my idea to Short WOR over 21.50?  And making money consistently for a year?

  239. @Felipe
     "…. I find it very sad that some people hear Boehner and automatically assume it’s a political statement."
    I’m not sure what you’re saying here. Every word out of ANY politician is a poltical statement, ad nauseum. 

  240. @Felipe
    Wonderful summary up there about WWII and the precursive events leading up to it.  That should be savored as an excellent synopsis of the real history of the continuation of WWI, and not the pablum that passes for it in our public education establishment.
    Very well done.

  241. Good morning!

    Japan/Pstas – I think the most logical thing is that we provoked Japan here and there until they attacked us.  There was a huge pacifist movement in the US at the time and the people had no stomach for war so they moved our Naval base all the way out into the middle of the Pacific and began screwing around with Japan until they got pissed off enough to attack.  I don’t think they expected what happened in Pearl Harbor, probably there were expecting on ship to be sunk in the Pacific which, like the sinking of Maine which started the Spanish-American war, would have been enough to unleash the Media and give our Government the excuse to roll over Congress and go fight the war the White House wanted to fight in Europe, even though Japan was clearly the guys who attacked us.  Hmm, why does this somehow sound familiar?  

    GOOG/Jo – Those are good if you use stops.  Letting them ride is risking $15 to make $5 so you have to be right 75% of the time to break even – still likely but the key is to avoid that big loss and then those $3s add up nicely.  

    Very funny summary of US history lessons Leon but I think your points would be better made without delving into personal insults.  

    Russia/Tcha – I was fortunate in high school to have had a radical teacher who taught a semester of Russian history.  It was great – we had our own Olympic team and everything!  That was the early 80s, when Russia was generally frowned upon and it was a real eye-opener getting the other point of view from a guy who used to teach history at Lomonosov.  We had tee-shirts and sweaters emblazoned with double-eagle crests with CCCP running down the sleeves and cyrillic writing on the back that said:  ??? ??????? ??????? ????? (The Russian History Class) and the prejudiced reactions we got from people on the streets were in themselves a great lesson – it’s amazing how much people can hate things they actually know nothing about…

    Poland/Lol – I do know that, perhaps I didn’t mention it properly in my summary but that was the treaty Stalin signed with Hitler using, as I did say, Poland as a buffer between Russia and Germany.  Obviously that sucked for Poland (where my own relatives were rounded up) just the way it sucked for the Philippines to be the stomping ground between the US and Japan.  As to Stalin, there WAS a plot to overthrow him.  Unfortunately, Trotsky had organized a large portion of the Red Army to revolt against him and he "had to" (in the same way Gaddafi has to) violently and brutally purge traitors in order to hold power.  As I said above, had he not done that, Germany probably would have rolled over a divided Russia and had the resources they needed to complete their conquest of pretty much the rest of the planet.  I’m not honoring Stalin but I’ve played enough military simulations to know that when the enemy is about to take your capital, you do send the population out to be slaughtered – anything to buy time while you shore up defenses.  It’s very easy to do this in a computer game but what kind of man can do that to his own people?  Of course, what kind of men can drop a bomb that wipes our a city of 250,000 people yet we have no trouble at all honoring them, do we?  

    Very cogent Goober – congrats on the salmon and the use of paragraphs!  That’s something I’d love to do rather than paying $40 at Whole Foods for 2 pounds for dinner!  Salmon is Maddie’s favorite thing (she is going to be a very expensive date one day!).  

    Anyway, so the Dollar was banged down to 74.50 overnight but is back to 74.76 now that real trading has begun and the futures are, of course, pulling back.  Oil is down to $103 so maybe a nice break on our USO puts.  China inflation is hot, which I’ll talk about in the post (time to go to work!).

    There is good news for banks as they offer a $5Bn deal to weasel out of the foreclosure probe – if it’s accepted, XLF should fly because they are looking at $20Bn in potential liabilities in robo-signing cases, maybe more.  

    We have oil inventories later, which may take the market down and the Fed’s new POMO schedule, which is a coin flip at 2pm and the 1pm 10-year auction, also a possible downer. 

    The post office lost $2.2Bn last year so be prepared for Conservative outrage and we can expect to hear all sorts of rabid statements about government inefficiency from people who obviously haven’t got a clue of what $2.2Bn divided by 177Bn pieces of mail is.  I kind of like it though – it’s a nice quick way to find out who the biggest idiots in Congress are…

    Silver hit $39, I think that’s take the money and run on AGQ longs – congrats to all on those.  Copper already failed $4 on China inflation news….

  242. War History in Asia – Japan had invaded Korea some years before the land war in China and the blockade of Hong Kong. They had shown an interest in Korea since the 1870s or so, and a heroic queen, my wife’s g-g aunt, did her best to play off Russia, China, Japan and the US hoping to keep the country free ( Of course she was assassinated in 1895, and the takeover progressed. What hurt was when the final takeover happened, Japan went to the US, then under Teddy Roosevelt, and made the case that Korea was a backward nation ruled by corrupt nepotic despots, and Roosevelt put his approval on the takeover. To this day, Roosevelt is a very unpopular man in Korea. His attitude may have been influenced by Korea’s blowing away a couple of US gunboats a decade or two earlier. In reprisal for which the US came and wiped out a fort and village on Kangwha Island.