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Thrill Is Gone Thursday – Already?

SPY DAILYYesterday was very exciting, but now what?

David Fry summed up yesterday’s action perfectly, saying "Wednesday’s massive rally was prompted by sudden global central bank intervention adding (printing money) liquidity (reducing the lending rate overseas to zero basically) to shore up sovereign debt in the eurozone. They basically set up a swap facility to do the job in the future. Is it a cure or a bailout? No, this is a handout. And it doesn’t solve the problems the eurozone is facing."  

"But, it must be said that the European leaders must have hit a dead end in talks and a potential financial panic must have seemed likely. Mind you, Mr. Bernanke is perfectly comfortable with reflation and money printing. He’s been at it for a long time. It will take years for the Freedom of Information Act to discover how much money and to whom the U.S. has given free money. Americans and others will see price increases in all products and services as a result of a weaker dollar negatively affecting purchasing power. Beyond Moral Hazard issues this is the cost you’ll see and perhaps even wonder why."

openingimageIt’s the classic "stick save" that was clearly (to us) telegraphed by the very low-volume blow-off bottom last week and now, in retrospect, it is also clear that the market manipulators and their media hounds were pulling out all the stops to get retail investors to SELLSELLSELL.  

As I mentioned yesterday, I’ve been railing against the market manipulation and the media nonsense that had been going on each month and today we learn that Wall Street execs did, in fact, meet privately with top Fed officials in September, according to Fed documents, and they "recommended" Central Banks make a joint effort to address the Eurozone debt crisis.  Don’t forget that our Fed works for the Banksters, not vice versa!  In addition to knowing well in advance this move was coming, their suggestions included boosting the global economy by buying securities, a move that may yet happen as many investors believe yesterday’s swap announcement was a prelude to additional coordinated action.   

You see, it’s not enough for Lloyd Blanfein (allegedly and for example, of course, a fine man like Lloyd would never do this) to know that the Fed is going to make a massive move like yesterday – there’s much more money to be made if he (allegedly) calls a Goldman alumni like Jim Cramer (another fine man who would never do something so sleazy – other than the sleazeball stuff he already proudly admits to, of course) and has him talk down the markets to chase the Retailers out and give him cheap entries on all the stocks he KNOWS are only down because his trained media jackals are pushing it down.  

Of course, it’s not JUST Lloyd (allegedly) – it takes a village full of shysters to screw over the American investing publish and, fortunately, we have an entire section of New York City filled with just such people!  They don’t HAVE to make is a conspiracy – all the "Wall Street Executives" who met with the Fed KNEW that action was coming and it was in ALL of their interest to lower the price of stocks before it happened.  All they have to do is spin their analyst’s outlook more negative and drop a rumor here and a rumor there….  

I guess if they REALLY wanted to terrify investors they could call on an ex-Goldman CEO to crash a fund in a scandalous manner to chase investors completely out of the Financials again – even though our entire Government has made it EXTREMELY clear that the big banks are, in fact, too big to fail.  So, just like we did in 2009, we loaded up on XLF and FAS as stupid low levels.  

The news was so scary that even we were scared to buy individual bank stocks (I missed that Fed meeting so we couldn’t be sure they’d take action) – but, as noted yesterday, we were able to make 66% on a 3-day FAS trade and, of course, Monday’s Dec $48/55 bull call spread with the $40 puts sold short for net .60 is already in the money for a $3,200 gain in our WCP (1,066% in 3 weeks) along with the other 4 trade ideas from that morning (long FXE, JPM, AA and VLO).  

XLF WEEKLYWe should have been brave and bought JEF but, as we saw in 2008, these bastards can wreck perfectly good institutions if they want to so we stuck with our ETFs and, of course, JPM – who are slightly less evil than GS and my favorite bank to buy whenever they trade down and last week we hit the bottom of a range that hasn’t been broken to the downside since 2008.  If you are not going to buy good stocks when they are cheap – when are you going to buy them?    

You should always have about a dozen stocks you know very well – that you KNOW the value of, that you understand the business of (so you are not fooled by rumors or swayed by idiot analyst opinions or retail panics) and that you follow every day until you get the feel for the top and the bottom of the range.  I would stick to a couple of sectors you know very well to start – ones that you A) understand and B) ENJOY reading about because you need to do A LOT of reading to really follow stocks.  If you do this simple thing, you will become a better trader – rather than chasing after whatever random thing someone on TV (or in a Newsletter!) tells you to buy.  

Now, this is NOT a BUYBUYBUY call.  If you weren’t in at the bottom, you may have missed the whole move already.  The point I want to make is that you have to learn to play these ranges because buying stocks on sale, like we did with the 5 on Monday as well as dozens last week – is MUCH BETTER than chasing things after you miss these huge pre-market moves.  In fact, we pretty much sat on our hands yesterday – too late to chase long – too early to get short.  

We did add a LONG-TERM trade idea on BRK.B, because we’re worried that one will get away, but it’s still hedged VERY conservatively for a possible 33% drop – not exactly uber-bullish but we feel good about the S&P holding 800 (Dow 8,000) at this point so I don’t think it’s too much of a stretch.   

HOPEfully, we’re just taking the pause that refreshes as ALL 5 of our indexes test the levels we expected them to test on a chart we’ve been using since the Great Crash.  This is what I mean by trading a range, folks – it’s not that complicated – we buy when we hit on of those low lines AND we have data that suggests we’re oversold (we don’t mindlessly follow TA, of course) and we sell when we hit the the top of our range AND we have data that suggests we are overbought.  

Last week was a classic, with the McClennan Oscillator flashing a huge oversold signal after both the RUT and the NYSE overshot the bottom of our range (-10% lines).  Seeing the NYSE and the RUT stop dead at our -5% lines is a GREAT thing for the 5% Rule, as it means our charts are still right on the money and the S&P tagged along 1,235 for most of yesterday before finishing strongly above it so there’s nothing to be bearish about until/unless we now blow 2 of our 3 Must Hold lines on the majors.  

NYMOOf course we’re going to have a bit of consolidation at our lines and that’s good and healthy.  I will be more inclined to remain bullish if we do take a few days to consolidate before racing back over +5% on the Dow (12,170).  As you can see from David’s NYMO chart on the right, we’re no long clearly oversold – we’re back to dead neutral on the oscillator and the faster we move up, the more overbought we will become (see, not complicated) – it’s slow and steady that wins the race in building a better market value.

We lost the usual 400,000 jobs last week and Chain Store Sales Reports are coming in mixed for November, not as bullish as Black Friday reports would have us believe.  So far, I see misses by CATO, FRED, JCP, GPS, KSS, TGT and SMRT and that’s being generous as we’re calling WTSLA, for example, a beat because sales are down 3.1% and not the down 6.8% expected.  KSS is a huge miss, down 6.2% vs up 2% expected.  We’ll keep an eye on RTH today and see if they can hold $110 but, if not, I’d be a bit more cautious.  

We get ISM and Construction Spending at 10 today and a peak at the Fed Balance Sheet this afternoon but it’s all about tomorrow’s Non-Farm Payroll report now and the ADP report (+200,000) has everyone expecting a big number – anything under 150,000 is going to be a disappointment now.  Oil was already disappointing yesterday with a huge build in inventory and barely a pop over $100, despite Basic Materials going up 6.6% on the day.  So, of course we’re still shorting the futures (/CL) below the $100 line, with tight stops – and we’re also going to make oil our primary hedge against a failure at our levels.   

SCO Jan $34/40 bull call spread is $2.80 and is currently $4.24 in the money so that, by itself is a nice bet on oil staying below $100 through Jan expirations in 50 days.  If we assume oil doesn’t go up 10% to $110, then we can sell the 20% lower (as SCO is an ultra) $32 puts for $1.45 as an offset and that makes the $6 spread net $1.35 with a 337% upside potential if SCO is at $40 or higher at Jan expiration day.  That’s a hedge I like, even if the markets are moving higher.


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  1. Thrilling oil lines:

    R3 – 104.9
    R2 – 103.32
    R1 – 102.06
    PP – 100.50
    S1 – 99.23
    S2 – 97.66
    S3 – 96.40

    Yesterday’s high and low – 101.75 / 98.92

    Breakout lines – 106.32 / 91.51

    100.50 oil prices is really not helping now! 

    Crack spread still low…

    One-Year Chart for Bloomberg Nymex WTI Cushing Crude Oil First Month 321 Crack Spread (CRK321M1:IND)

  2. A JPM Chase mortgage banker comes clean about subprime loans in a NY Times Op-Ed.
    “’The bigwigs of the corporations knew this, but they figured we’re going to make billions out of it, so who cares? The government is going to bail us out. And the problem loans will be out of here, maybe even overseas.’
    One memory particularly troubles Theckston. He says that some account executives earned a commission seven times higher from subprime loans, rather than prime mortgages. So they looked for less savvy borrowers — those with less education, without previous mortgage experience, or without fluent English — and nudged them toward subprime loans.
    These less savvy borrowers were disproportionately blacks and Latinos, he said, and they ended up paying a higher rate so that they were more likely to lose their homes. Senior executives seemed aware of this racial mismatch, he recalled, and frantically tried to cover it up."
    We all knew this was happening anyway, I remember speaking to some cleaning lady at the office talking about flipping houses in Queens, and thinking "WTF?!".  

  3. stjeanluc: When you say Crack spread, what are you referring to?

  4. Crack spread / Drop:

    Crack spread is a term used in the oil industry and futures trading for the differential between the price of crude oil and petroleum products extracted from it – that is, the profit margin that an oil refinery can expect to make by "cracking" crude oil (breaking its long-chain hydrocarbons into useful shorter-chain petroleum products). 

  5. Wow, that’s a lot of volume at the close – from Barry:

    Wednesday’s volume was distorted by huge market on close orders for an index rebalancing and end of month shifts. As the closing bell began to ring, the volume was 960 million. The final was 1.6 billion so over 40% was due to on close orders. 


  7. Check out where the rally has been stopped yesterday:

  8. Thanks to FXlive..

    Spanish auctions raised 3.75 bln, top of 2.75-3.75 target range
    French auctions raised 4.346 bln, near top of 3.0-4.5 bln target range
    Euro zone November manufacturing PMI (final) 46.4, in line with flash estimate
    UK November manufacturing PMI 47.6, better than Reuters’ median forecast of 47.0, but still lowest read since June 2009
    French Q3  ILO unemployment rate rises to 9.7%, up from 9.6% in Q2, as expected
    Swiss Q3 GDP +0.2% q/q, +1.3% y/y vs Reuters’ median forecasts of +0.1%, +1.7% respectively

  9. Good Morning from Marco Island-
    Phil—hope you are feeling better
    If oil cannot hold 100 will it be a good short  at that point? or wait for more clarity--if we ever get that!

  10. The latest European PMI not painting a bright picture:


  11. RPXC – Anyone have any love for or insight on this company?  For a variety of reasons, subject to general veto here, I’m considering a buy/write (Feb 15s) – or long diagonal.

  12. Phil – Someone has issues with you this morning:
    Philip Davis – Freelance Communist?

  13. Puntos de pivote para hoy:

  14. Merkozy Pix / kustomz – Funny…

    Merkozy: Frankreich und Deutschland sollen der Kern des neuen Europas werden

  15. Stunning likeness! Very funny.

  16. Thanks stj, I think its hilarious.

  17. Needs to pluck eyebrows.

  18.  diamond – ouch. Perhaps JRW can clarify?




  22. Money Portfolio – This weekend I will add a margin calculator to the spreadsheet so you can understand the amount required to enter the trade. It will be based on Reg-T rules for now. 

  23. stj – Thx for the great charts/updates.  Just easing my way into some of the money trades.  For now, where your noted entry costs are still close to current costs, is it cool to still make the trade?

  24. NF**X
    Phil apologized for the use of the chart in the comments section of his SA article.
    That chart was from Slope of Hope – it’s been corrected on my site and should be on SA soon as well. I copied a link thinking it was done by JRW so my bad. This is why I usually stick to guys who are already in our Chart School – so we know we have permission to use them…

  25.  Spring Heel Jack/JRW: JRW has frequently credited SHJ for his charting prowess (this is how I came to follow SHJ).Tempest in a teakettle.

  26. GMCR – there she goes!

  27. dclark41 – Thanks.  I didn’t think it was a big deal.  I just takes forever to build the awesome credibility PSW has – and minute nicks for people to look for reasons to knock it down.  Again, thx for ur vigilance.  

  28.  Mosler’s take on CB action.  Always interesting:

    Just looks like the Fed lowered the rate on its swap lines to keep libor down, which had been moving up to its prior swap line rate.
    No big deal, apart from the fact the Fed shouldn’t be allowed to lend on an unsecured basis like this without explicit approval of congress.
    Lending unsecured on an unlimited basis has the potential to be highly inflationary.
    With the currency a public monopoly, the price level is necessarily a function of prices paid at the point of govt spending and or collateral demanded when govt lends.
    Allowing unlimited unsecured lending has the potential to vaporize the currency. And while in this case that kind of abuse isn’t likely, the potential is there.

  29. Trades / NF – Which one do you want to enter? 

  30. EU, Banks and Industrials are down….there is no reason for SPY, DIA to be up.  But, then again, they are only trading with themselves on the indicies….so why not.

  31. Good morning! 

    Having given the matter some thought, I’m a little more in favor of taking the bullish money and running into the weekend.  Once we are clearly over our lines, THEN we can go back to being bullish but we need more stimulus that just this bank nonsense to stave off these lousy global manufacturing numbers.

    I guess the Retail reports put me off:  

    Nov. same-store sales (actual vs. Thomson Reuters estimate), update #1:
    CATO -5% vs. -1%.
    COST +9% vs. +6.5%.
    DDS +3% vs. +3%.
    GPS -5% vs. -4.1%.
    LTD +7% vs. +4.4%.
    M +4.8% vs. +3.9%.
    SSI +2.3% vs. 0%.
    TGT +1.8% vs. +2.8%. 

    Nov. same-store sales (actual vs. Thomson Reuters estimate), update #2:
    JCP -2% vs. -1%.
    KSS -6.2% vs. +2%.
    JWN +5.6% vs. +5.1%.
    ROST +5% vs. +3.7%.
    TJX +4% vs. +4%. 

    Nov. same-store sales (actual vs. Thomson Reuters estimate), update #3:
    FRED +1.5% vs. +1.8%.
    SKS +9.3% vs. +6.1%.
    SMRT -4.6% vs. +0.5%.
    BKE +6.9% vs. +4%.
    WTSLA -3.1% vs. -6.8%.
    For a total of 7 misses, 2 in-line and 9 beats.

    That’s just NOT that bullish, is it?  I’m still not looking to fight the Fed and get bearish but it’s a good idea to have itchy trigger fingers for profit taking if you are not a gambler.  Dollar over 78.50 is the best single signal to get out (now "safely at 78.30) as it’s a barometer for the EU, etc and I’m pretty sure the BOJ won’t be risking any Yentervention while their market is running up with ours.  

    We are NOT playing the WCP conservatively so we’re still following through with the risk-on play and sticking with things as long as our technicals hold up but I will be looking for another hedge into the weekend.  Other than that, more watching and waiting to see what sticks – it’s a slow news day so far and I doubt ISM or Construction Spending will move us much but NFP can move us 300 points one way or the other pre-market tomorrow so we need to think about where we are before the day’s end. 

    Thursday’s economic calendar:
    Chain Store Sales
    Auto sales
    8:30 Initial Jobless Claims
    10:00 ISM Manufacturing Index
    10:00 Construction Spending
    10:30 EIA Natural Gas Inventory
    4:30 PM Money Supply
    4:30 PM Fed Balance Sheet

    At the open: Dow -0.19% to 12023. S&P -0.26% to 1244. Nasdaq -0.07% to 2294.
    Treasurys: 30-year -0.67%. 10-yr -0.12%. 5-yr -0.01%.
    Commodities: Crude -0.21% to $100.14. Gold -0.05% to $1749.35.
    Currencies: Euro +0.23% vs. dollar. Yen +0.18%. Pound -0.07%.

    Market preview: S&P futures -0.3%, little changed from earlier despite weekly jobless claims unexpectedly rising back above 400K and mixed same-store retail sales (I, II, III), as yesterday’s swap excitement appears to wear off. Among retailers, Lululemon -14% as sales disappoint. Yahoo +4% following more speculation and counter-speculation. Later: ISM Manufacturing, construction spending.

    Initial Jobless Claims: +6K to 402K vs. -3K consensus. Continuing claims +35K to 3.74M.

    Brazil’s November PMI jumps to 48.7 from 46.5 previously. The country was among the first of the emerging markets to initiate a monetary easing cycle, and cut rates for the 3rd time in 3 months yesterday. Markit provides a longer term chart of BRIC PMIs, all near flatline territory at the moment. (PR

    Commerzbank’s monthly survey of corporate clients finds a sharp rise (from 28% to 40%) in the percentage of German firms optimistic about the future of the euro (was the survey done at 9 ET yesterday?). "We see this as an indication that the companies expect to see an imminent solution to the debt crisis," says the bank.

     "This is about governments borrowing too much … the focus should be on politicians in those countries that have borrowed way too much," says the Fed’s James Bullard. "It can’t be papered over," he adds, giving some support to an ECB under pressure to hit a button and make it all go away. (live here for a few more minutes)

    The BoE’s FPC releases its Financial Stability Report, calling – among other things – for banks to bolster their balance sheets while not reducing their level of lending. Huh? The committee also encourages banks to prepare for disclosing leverage ratios in line with Basel recommendations next year. What’s a lender to do?

    It’s only taken over 530 days, but Belgium is finally about to get a government, with French-speaking Socialist Elio Di Rupo due to take office next week at the head of a six-party coalition. There’s nothing like a good ratings cut to concentrate minds. Ten-year yields, which had worryingly surged, are -17 bps to 4.83%. 

    The crash in the bull market in the French/German bond spread continues as French 10 year OAT yields fall 22 bps to 3.17% – it’s the biggest drop in more than 20 years. More than 200 bps a few sessions ago, the OAT/Bund spread now sits at 90.

    Economist Wang Jian forecasts China’s growth will slow to 8% in 2012 and drop down to 7% in 2013, despite "modest" government easing. Jian increases the odds that Q4 GDP will dip below an important threshhold and tip the scales for the central bank toward stabilizing growth: "If GDP growth falls below 8 percent, we will see a sharp policy reversal."

    Gap (GPS) reports November net sales fell off 3% Y/Y, led down by a 7% dropoff at its Old Navy chain of stores and a 9% decline of international sales. YTD comparable sales are now down 3% Y/Y. 

    Kohl’s (KSS) is down 7.4%, and J.C. Penney (JCP) down 1.2%, after reporting weak November same-store sales. While calling its November results "disappointing," Kohl’s says it was "encouraged" by its Thanksgiving weekend performance. However, no figures are provided for weekend sales.

    Back on: It looks the FDA is now OK saying it’s approved Ranbaxy’s generic version of Pfizer’s (PFE) Lipitor drug. The approval was onthen off – but now sits live on the FDA website.

    Chinese authorities are investigating the death of a child who reportedly fell ill after drinking one of Coca-Cola’s (KO +0.3%) Minute Maid milk beverages in the north of the country. Coke has tested the product line and found no problems but has anyway removed the drink from the shelves in Jilin province.

    Sprint (S -3%) has offered Clearwire (CLWR +3.4%) up to $1.6B in conditional revenues and funding, confirming the report that was floated just before the close of trade yesterday. This clears the way for Clearwire to make a $237M interest payment today. (PR) - Great call by Stuman on this one back on 10/13!  

    StatCounter claims Google Chrome (GOOG) passed Mozilla’s Firefox in November to become the world’s #2 web browser – a month earlier than predicted. The firm estimates Chrome’s browser share rose to 25.7% (up 1230 bps Y/Y), while Firefox’s slipped to 25.2% (down 600 bps). Internet Explorer’s (MSFT) share rose slightly M/M to 40.6%, but fell 760 bps Y/Y. 

    Quote of the day:  A broker note courtesy of the FT‘s Chris Adams and Neil Hume: "Trying to do ANY sort of fundamental analysis in this market is like bringing a #2 pencil to a gunfight." Indeed. 

  32. ISM 52.7, much better than expected.  Best since June and up from 50.8 in October – what recession?  

    Construction spending also up 0.8% and we get Auto Sales today, which should also be good so UP WE GO!  

  33. Good morning,


    IWM  71.87,  72.15,  72.56,  72.98,  73.24,  73.61,  74.11,  74.56  and 75.36

    I’m in TNA, as is Lloyd !!

  34. JRW got me in trouble today:


    The chart you posted in your article below used one of my charts:…

    I was a little annoyed to see that the chart had been cropped to remove my blog signature and that you gave the credit to a ‘JRW’ who isn’t me.

    The chart was posted in my morning post yesterday at my blog and at

    Here’s the link to the original chart:

    Might I ask who cropped the chart?

    Very best,

    Springheel Jack

    This goes for all moderators – if you put up a chart in chat – PLEASE makes sure it is credited properly!  


  35. stj – Frankly, I was just looking at those with current price close to entry price.  

  36. Trades / NF – The AA strangle is still in play then, but not sure that selling the Jan 9 put is good now as it has lost a lot! You might want to check the Jan 10 Put (now 0.81 instead) but keep in mind, Phil is not as bullish as he was yesterday so you could get another entry at the 9 strike later. And also, we are short 25 contracts now so margin could be an issue.

    The FAS Money trade could also work as the XLF BCS is still good and the short options expire tomorrow and we’ll sell some others today or tomorrow. The only consideration is again margin as shorting FAS options is margin intensive (about $5K per contract – per Reg-T). Our current position requires 15K of margin plus the cost of the BCS.

  37. So that’s how I can get Phil in trouble. Hmm….  Just kidding.  ;-)

  38. Phil
    Good morning
    Sold some WFR Jan 2012 $7.5 puts for $.99 a couple months ago, now $3.90
    Any roll?
    Give up? And get into a different equity altogether?

  39. FAS 51/52 – I think this was one of our "bullish" plays this week.  Looks like we’re at about our max gain today anyway, yes? Shut ‘er down and take my Dad to lunch?

  40. Phil, speaking of the AA trade, if you are not as bullish, it might make sense to sell some Jan calls against that position. Half a position at the 10 strike could be 2x to the 11 if needed. And 11.50 is the top of the range for the last 3 months!

  41. stjeanluc
    Is he not bullish or bullish again??
    ….UP WE GO!

  42. Surprised we havent seen the $ firm up a bit after the strong ISM.

  43. Phil
    Do you still like EDZ as a hedge? Specifically, April ’12  25/45 spread.

  44.  teh action today is constructive for higher prices….  selling limited and "feels" as though  are an  xious to get in…. be surprised to see a push up toward the first resistance level at 1252..having said tha.. though.. the VIX is sliding along its lower Bollinger Band… and that keeps me cautious and looking for an eventual reversal….short term mind you

  45. Phil – I have naked short TNA $40 Calls, sold for $2.30, now $6.40. How can I adjust this? Thank you.

  46. dont be suprised!!*

  47. @Phil, do you know anything about AKS?  It currently pays a 2.4% dividend and has 120% vol we could sell.  They bad earnings last quarter but I can’t find a ton of information about why.

  48. JR/Lloyd
    I don’t know how you do it……Lloyd loves to F*** with the traders.  Particularly in IWM.

  49.  Ha ha… we’ve nearly retraced the entire move up. LOD was 730, so probably a floor for the day. I’m sure we’ll head back up into the range of yesterday’s close. For now though, my signals are for continued shorts. They tend to fail at the end of a move though, and we could be there now. 
    JR, where did you get out of TNA? I sold my last TF at 740. 

  50. Subprime/Kinki – I ran a real estate data service back then and it was sickening what was going on in the Mortgage Industry.  Not only did they try to steer everyone they could into sub-prime loans (even on refis for credit debt so they took a perfectly good mortgage people had already paid a lot off of and turned it into a leveraged nightmare at higher rates, which they justified because it was better than 18-21% usurious rates the banks were charging for credit cards.  For one thing, the banks kept upping credit card fees and charges BECAUSE it caused people to run up more debt and steered them into trying to refinance sub-prime mortgages.  

    That caused a feedback loop where they made it harder and harder for borrowers to qualify for prime (where they made little money) and pushed more and more people into sub-prime, where the banks loosened the underwriting requirements to the point where I was losing business to Radian because we CHECKED the data and gave less favorable reports so they didn’t want ours, preferring Radian’s shoddy information as well as joke comps from new web sites like Zillow, which ONLY go by last sale prices in a neighborhood, without in any way, shape or form estimating the actual VALUE of the home so every new and more expensive sale raised the comps for the next sale and "justified" the completely insane and unsustainable rise in home prices (and, of course, the BS paper increases in home equity that allowed the banks to "help" more and more people "qualify" for sub-prime loans).  

    Anyway, don’t get me started! 

    Great cartoon StJ!  

    Right on the money Pentax:   

    SPY in world currency

    Don’t forget that was a huge last 30-minute push to get there.  I’ll only believe it if we’re still there next week.  

    Thanks Savi – much better now.  Hope the vaca is good.  Yes (see above) still game on for shorting oil off that $100 line.  I’m still super-confident it’s not sustainable.

    PMI chart is very depressing.  

    RPXC/NF – Nice niche company but possibly a bit over-valued as they are not likely to sustain prior growth.  Great expectations off the IPO not being realized and THAT’s why they are "cheap".  

    Freelance Communist/Diamond – I don’t see it, do you have a better link?   Anyway, I certainly object to that term as I have a steady job as a Communist and do not freelance!   8)  

    GLW/DC – Of course I agree with that, I love GLW long-term.  

    AA Money/StJ – I think just .38 for the short Dec $10s is simply unfair and we should be happy enough to collect the full $2,075 off the short Jan $9 puts as that pretty much makes the long position free and THEN we’ll be happy selling $11s for .10 and making $100 a month.  So, for now, I don’t want to sell the $9s and the $10s aren’t worth selling so I think we just target a 1/2 sale at .50 on the Dec $10s if we get there but, otherwise, unless the S&P fails 1,235, I am not inclined to cover. 

    FAS Money/StJ – Looking good there and there’s not much harm in selling 2 next weekly $64 calls for $1.90 and one next weekly $54 put for $1.50 to pick up another $530 in premium.  

    IWM Money/StJ – I’m a bit more nervous about that one but we can sell 2 Dec $50 calls for $1.20 and then sell a couple of puts if they get over $45 (now $44.25) like the $42 puts, now $4.70 for maybe $4.25 and then we have a good enough spread to keep us out of most trouble and another $1,000+ of premium sold.  

  51. JR
    I see IWM is back aligned tick by tick with the dollar.  You have to believe Lloyd is going to pull the plug on the dollar at some point to goose the market.

  52. drcraig / TNA


  53. FAS Money – Selling 1 FAS Dec2 54 Put (now 1.55) and 2 FAS Dec2 64 Calls (now 1.94). Will post an updated status when the trades go through. 

    IWM Money – Selling 2 TNA Dec 50 Calls (now 1.28). Waiting for TNA to go over 45 to sell more puts.

    Phil, the TNA 42 Puts are 2.75 not 4.70.

  54. Margins/StJ – Very cool.

    Still cool/NF – Sure it is, the point is to simply cover the contingency (and it’s a bullish one) of the short calls getting away from us so we have a backstop to roll to (and, in a PM account, it lowers the margin requirement considerably). 

    Credits/Okno – I personally don’t care when my stuff gets picked up as it’s generally stale after a few hours so little harm as long as my name is on it.  Jack not too bothered either (I spoke to him) – it’s really just an issue of having his name cropped out of the chart and I would feel the same way if someone published my post without crediting me.   Actually, this may all turn out for the best as Jack is interested in possibly joining our Chart School line-up – with proper credits, of course.  8)  

    GMCR/Pharm – That’s a funny move!  

    ZIP crashing and burning now.  

    Vaporizing the currency/Peedle – Well that’s the whole point!  

    WFR/Maya – Yes, they are sucking, aren’t they?   I’m seeing $3.30 as last sale on the $7.50 puts so make sure your broker isn’t ripping you off.  They can roll to 2x the short 2013 $5s ($1.65) better than even and, since you sold them for $1 and pick up another net .40 it puts you in the short $5s at net $1.40 ($1.39, to be exact) with a put-to price of net $3.61.  If they fail to hold $4, you can then sell the $5 calls, now .80 for maybe .70 and then just buy stock to cover if they go back over $4.50 and you’d end up in a $2.41/3.70 buy/write and, if you keep a stop at that $4.50 line, your worst case is having 2x put to you at net $2.91 (because of the naked call sale) while the call-away at $5 is still a double.  

    Obviously, you have to REALLY want to be in WFR long-term, in case the economy collapses it will be many years before solar is back in fashion.  If not, you can instead flip to 2x the INTC short 2013 $20 puts at $1.70 or even 1x the 2013 $25 puts at $3.80 and, if you don’t want INTC for 20% off, you shouldn’t even be in the sector!   

    FAS/WCP, NF – Oh yes, great point, if you can get $1 for it, may as well take it unless, of course, your broker does what TOS does, which is just drop the net $1 in your account if it closes in the money.  Whichever is fee cheaper in other words.  

    Speaking of TOS, Scott clarified that PSW members can still contact him to get either a flat $1.50 per contract or $9.99 per ticket PLUS .75 per contract (you have to pick one or the other method).  Of course, if your volume is big enough to put you at around $2K a month in fees or more, they are flexible from there.  

  55. Exec, I for one wouldn’t be shocked but, the data clearly shows US is not going into recession, European data on the other hand needs ECB to step up….soon.

  56. 20 DIA Dec $116 puts at $1.14 in WCP with a stop at $1 (over 11,200). 

    Shame on you if you missed SCO!  Game on for oil (/CL) below $100!  

    Dollar 78.40. 

  57. Can I please get a the information on how to contact Scott at TOS?  Thanks!

  58. TOS – Man, TOS will do that if a BCS finishes ITM? I haven’t paid much attention to fees other than, of course, factoring them into net of every trade. Been at ET sooooooo long. Surely I’ve traded enuf to make fees matter more in the aggregate. I better go compare ET, OpEx and TOS now – on fees, margin, etc.


  60. phil,
    took your SCO trade but somehow missed the sale of the 32 puts, would you still sell them here currently 1.10 bid?

  61. Good morning. Since I’ve been a long term outlook retail investor for so long, I am finding that I need to re learn everything and begin to look at things differently. For instance Phil, when you talk about being bullish or bearish, you’re really referring to being bullish or bearish short term, within your range rather than commenting on the long term direction? As a reformed buy and hold investor, I thought of buying a stock when low when the long term outlook for the markets looked bullish, rather than realizing that there were high and low entry points depending on where we were in a range. Am I on the right track with this thinking? I have definetely lost money chasing a rally thinking that I’d missed the boat…I don’t want to do this anymore.
    I have set up a virtual account and want to practice and follow along with the wcp, should I just start at this point or are there trades currently in the portfolio that I can pick up at their current positions. Or, would you suggest a way to come up with “sample” trades that I could use only, of course, in the virtual account for practice. Thanks guys, I hope my questions and observations are not too novice for this talented group.

  62. AA/StJ – I agree with you if they fail to hold yesterday’s low of $9.65.  

    Up/DC – Saying we are going up on news is not the same as being bullish.  Now I’m more bearish because we had such a lame reaction to very good news.  

    EDZDC – I always like EDZ as a hedge when it’s low ($18) so a current play on them would be selling the Jan $18 puts for $2.70 to pay for the Jna $17/27 bull call spread at $2 for a net .70 credit on the $10 spread with 1,614% of potential net upside against the danger of being long on EDZ at net $17.30 (if EDZ drops 10% and you don’t roll the short puts).  How can you not love that as a hedge?  The Aprils offer too much time for ultra-decay and, of course, I’m longer-term bullish – I just want to cover the rough patch while we still don’t know how much stimulus we’ll finally get. 

    So, to summarize Angel’s prediction:  

    $99 oil – yay!  78.42 – boo!  

    GLL $16 Dec $16 calls are .65 and 10 is fun in the WCP. 

  63.  WFR:  No expert on the stock, but the Chinese are making the cheapest solar panels on the planet, many of poor quality [although Hyundai made lousy cars at one point], and the the shares are widely distributed among the Poliburo, plus Western government subsidies for alternative energy are questionable going forward.  A long road for WFR, agreed.

  64. Phil – It looks like he realized that he is an "A**hole" and replaced the original post with a new one. However, I saved a pdf of the offending page and sent it to:  admin (at) philstockworld (dot) com. I apologize for the font size, but the charts seem to have effected the pdf. Anyway, besides the title, Springheel Jack (obviously not his REAL name) attacks you starting on page 4 …

  65. SCO – I’ve been letting the SCO dec 38/43 bull cs ride – waiting. Cost me $1.90. Oil obviously not my forte – as if I have one yet. Sit tight here for a bit, PD?

  66.  If anyone has a number/email for Scott at TOS, I would appreciate it.

  67. PD,
    to clarify the sco 32/40 bcs bought at 2.70

  68. Antother great winner on oil Phil, thanks.  Thanks also to Stjeanluc for the money plays.  Are we cashing out the WCP or waiting still?   

  69. @Diamond – Springheel Jack did take that article down.  Interesting.

    Yeah Phil, he was pretty petty and nasty in that article in my opinion.  But hey, if all is good between you and him, then great.

  70.  So Phil,
    Cashy and cautious here?  
    Seems to me like they wouldn’t have bothered the massive pump this week just to let it all fall back apart.  I  expect another leg up.  
    But you’re the boss!

  71. What’s your thought on GLL?

  72. ET – Hmmmm. I don’t see a flat rate per contract. But at 150+ per quarter it’s 7.99 and .75. Lower volume is 9.99 and .75. I imagine this is old news for most here.

  73. From SHJ:

    No worries JR. An honest mistake quickly resolved. :-)

    A good thing overall in fact as Phil’s invited me to do some work with PSW and that looks very interesting. 

    I’m hoping we might work together on some stock plays. The combination of a decent chartist with a good fundamentals and options guy could make for some very interesting trades.

  74. Peedle:  Watch that Euro.  Not much follow through on Euro strength, because I’m not sure that Europe’s situation has changed as much as touted recently.  I agree with Phil that Germany will eventually throw their wallet on the table because it’s the best of bad alternatives, but the negotiation between Germany and The Rest of Them is no done deal by any measure.

  75. Phil remember we are still in the USO Dec1 buy 5 38p for .46 now down to .19 we still wait ?

  76. JR,
    IWM is a joke. 
    We get a big move then a minute later the dollar moves.  Who’s seeing these moves first, and how?

  77.  Phil,
    You asked us to remind you about the BRK type co. you are trying to set up… I’d be very interested in participating if I can help…

  78. SHJ – Wait. He’s just “decent” and PD’s only “good”? Who is he – S&P? I mean u gotta throw PD a AAA, no?

  79. Phil- Is there a particular number for reaching Scott at TOS, or a last name- thanks- much!

  80. exec

    The ‘best day in years’ follows the ‘worst Thanksgiving week ever" which followed ‘one of the best Octobers ever’ which followed…. Well you get the point. Bipolar.

  81. stjeanluc – Correction to spreadsheet …
    FAS Short Option: Dec2 11 64 Call (not Dec1)

  82. TNA/Nicha – Those are Jans, I take it?  It ain’t over till it’s over.  TNA is at $43.80 so that’s 50% premium, adjustments come when you have burned more off than that.  Note that the April $53s are $7 so the question is – do you fear RUT 800?  If not, then don’t worry.  

    AKS/Craig – They are a lot more iffy than X and MT, who are also very cheap right now.  It’s all about efficiency in that busiiness and bigger is better – I’d stick with the majors.  

    730 holding on RUT so far.   

    TNA/StJ – I don’t know what I was looking at, must have been Jan.  

     Scott/Drop – scott at thinkorswim dot com. 

    Margin/NF – Hands down, IB gives you the most margin but that’s crazy dangerous to use anyway.   They encourage you to go 5x on margin and put it into dividend payers that pay more than the margin costs you, which makes sense but you’re still 5x down in a crash unless you hedge away most of your dividends.  The only thing about TOS is they do that all the time with spreads, which is FANTASTIC but they refuse to put it in writing as a policy so, with large amounts – I still have trouble trusting them.  

    SCO/Sage – That’s too bad, they opened at $1.45.  I’d take $1.45 for the $33 puts instead.  It’s all rollable anyway.  

    Range/Beau – Yes, I don’t tend to flip-flop my macro outlook every other day!  And yes, everything has a range so we watch the range of the stock, the range of the index the stock is in and the range of the market and, when we find something that becomes a compelling value (like MT last week), we buy it – EVEN THOUGH it may go down further, because we PLAN to buy more if it does.  Why should you EVER buy a stock that’s not on sale?  There are 9,000 stocks to buy and, every day, someone is having a sale.   I love BA and we just jumped on them below $60 but, when they were $75, I still loved them but we wait for a market crash (or a plane crash) to take the price down.  If not, I love IBM too, and AAPL and HPQ (who did go on sale) and INTC and VLO and WMT and MO and XLF and FDX and UPS and CAT and CHK and AXP and GE and JPM and CSCO and MCD and V and PFE and UTX and VZ and T and…  well, you get the idea.  

    The same way I like Levis but have no reason to buy them unless they go on sale, I have no reason to buy stocks that aren’t on sale.  If there are no sales, I don’t buy – that’s pretty simple, right?  You should go back through the Portfolios tab and read trough our old portfolios – there’s a lot of explanation about why we like things and you can look at the charts with hindsight and see why and where we pick our entries.  As to the WCP, the trades are self-contained mostly.  Of course we try to balance and right now too bullish (which is why I did the DIA puts – just in case and it’s worth losing $300 to protect our unrealized gains rather than cashing out in a panic) so you just have to be careful with where we’re weighted as of your entry but we’ll be back to almost all cash tomorrow so a good day to benchmark.  

    WFR/ZZ – Like INTC, they will have to protect themselves from competition by pushing the state of the art constantly.  At the moment, there’s a tough sell on price-performance but soon the next gen solar cells will make Chinese junk a waste of space and the Chinese are not good playing that game.  They will end up selling cheap solar to the masses and that’s great for the Global economy but, if you have 100,000 sq foot of roof space and one cell gives you 50% efficiency for 130% the cost of 30% cells, it’s a no-brainer for the bottom line .  

    Springheel Jack/Diamond – That’s funny because he was super-nice to me when we talked.  Hey, that’s the problem with the internet, people write things in anger that they regret later.  I guess he felt no one got back to him and clearly he doesn’t get the fact that non-members CAN’T comment on our articles so he thinks we have mysterious moderators who look at every comment before allowing it to be published (as have some people in this cat room too!).  Anyway, I didn’t do anything wrong so I’m not even offended, it was a misunderstanding and it’s been cleared up and he apparently regretted what he wrote before he even spoke to me so no biggie but thanks for letting me know.  

    SCO/NF – That’s a little iffy at $39.19 but you can pull the $38s for $2.70 and buy the Jan $40s for $4 so $1.30 out of pocket and you’re still $3 below the rollable caller and, assuming they expire worthless, you just need to sell something else for $2 and you reduce your net to $1.20 on the Jan spread (or sell something for more and roll down like, if you had the Dec $40s, now $2, you could sell the $39s for $2.30 and roll down to the $36s at $4 and you’d be a $3 spread that’s all in the money).  

    Thanks Dennis!  I’m really torn right now.  We wanted to see consolidation and this is good, consolidating behavior so far.  Oil dragged us down and that doesn’t count since it’s stupid high but we’re holding up nicely so I guess I have to switch my brain off and stick with the technicals for now and stay bullish.  

  83. bad dog phil!!  never be snarky when someone takes the time to help..i am only trying to assist the site with my perspective…now i know what it would have been like ot have a younger brother…NOOGIE TIME!!.i will pout now


  85. Springhill Jack- Phil, I encourage you to pursue that. I have been following some of his work and it is high quality. Would be a great addition to PSW.

  86. Phil/TNA – sorry that was Dec $40 call sold short for $2.30, now $6.40.

  87. Expectations/Peedle – I agree but into the weekend, without confirmation that something will be done and with EU bond rates still way high – as I said yesterday, the news we have so far was good for 3% and we’re up 4% so, Fundamentally, I have to be cautious and cash doesn’t stop us from joining in that 2nd leg if it’s coming.  

    GLL/David – It’s just a small disaster hedge.  If something happens in Europe to screw our longs, then gold should drop $50 pretty fast and that should put GLL back to $17.50 for a nice double at least.  If not, our bullish plays pay off and we’re happy to lose a hedge.  

    Yep, all good JRW – If he makes charts like that all the time, I’d love to have them on the site.  Just gotta watch his temper…

    USO/Yodi – Yeah, I think a DD into the weekend may be the  way to go but hopefully just be able to ditch them on a sell-off today or tomorrow.  Don’t forget, as Dec moves forward, we’re playing for the contract rollover too.  

    Holding Company/IZega – Yes, my aim is to gather my thoughts and put an outline post up for the weekend.  Please do remind me on Friday evening if you remember as it would be nice to get started early next year.  

    Scott number/Jthom – I just have the Email but I think his last name is Sheridan so you can call the main if you need to speak to him.  He’s one of the founders of TOS so I’m sure they’ve heard of him.  

    Snarky/Angel – That wasn’t snarky, just an observation of what it reminded me of.  I’m just as indifferent as you about direction at the moment.  

    Will do Pstas.  

    TNA/Nicha – Well same thing, it’s rollable and you are either saved or screwed next week.  Those are dangerously volatile plays to make if you don’t fully intend to ride them out.  

  88. Does anyone have a last name for Scott or an extension number at TOS- thanks much!

  89.  Scott Sheridan at TOS.

  90. @jthoma - When I called TOS, I spoke to a customer service rep and asked for Scott.  He said he wasn’t available, but that he was "standing right near him" and the rep confirmed the rates Phil described. 

  91. thanks Kallen and Jcaesar


  93. Just an FYI: The other day I was wondering why AMR stock (currently $0.37)didn’t go to zero even though they declared bankruptcy.
    This article explains why the share holders might not get wiped out.

  94. BTW is TOS at TD the same as TOS?

  95. @sage – TOS is owned by TD.  So yes, they’re the same.

  96. Phil…
    Apple Play Recommendations? 
    SELL Jan 2014 $360 Put
    BUY  Jan 2014 $380 Call
    SELL Jan 2014 $600 Call
    => Credit Trade of $3.82 right now.
     200-day MA of AAPL is $364, so this entry allows you to buy the stock @ $8 below 200-MA which is strong support for apple. It ties up $11,597.65 of buying power, with a max gain of $22,382 per contract.
    Do you like this trade our would you opt for something different? THANKS

  97. Spreadsheet / Diamond – Thanks! Done. 

  98.  "Bail-in" — The birth of a new financial term!   I’m trying to get my head around what this means, although its sounds both desperate and creepy.
    From Bloomberg]  "The European Union may exempt bank debt issued before 2013 from proposals forcing investors to take losses at failing lenders, said a person familiar with the plan…Excluding the debt is designed to prevent lenders’ funding costs from rising, said the person, who declined to be identified because the discussions are private….Under draft proposals obtained by Bloomberg News, holders of long-term unsecured senior debt in a collapsing bank would be first in line to take losses"… [on post-2012 lending?] "once a lender’s capital and other subordinated debt is exhausted. Long-term bonds would be those with a maturity of more than one year."
    One suggestion:  “From a funding point of view it brings two words to mind — cliff effect,” Bob Penn, financial regulation partner at Allen & Overy LLP, said in a telephone interview in London today. “There’ll be swathes of bank-funding issuance and then it will fall off a cliff” when the so-called bail-in rules are implemented."

  99. phil,

    i thibk i found free money. does this seem right?
    an ETF itm put still has $.10 premium. the same strike call is just $.01. if i short the ETF, sell the put and buy the call, do i really pocket the 9¢ with no risk?

    its small potatoes, but seems right. i guess fees will eat up most of the money.

  100. Thanks all for asistance…I don’t say thanks each time one of you graciously replies to my Q’s but know that it is implicit I am very grateful for time taken out of everyones busy day. Cheers!

  101. Phil--do you have an opinion on the Hong Kong currency trade/ (Ackman)?? just curious..

  102.  Phil,
    Tesla Motors – TSLA Trade
    SELL Jan 2014 $20 Put
    BUY  Jan 2014 $30 Call
    SELL Jan 2014 $45 Call
    => Credit Trade of $0.20 right now.
    Basis of the trade.  IPO was @ $16, low of this year $21, peak stock price was $36. The Buying Power reduction is $718 per contract with a maximum profit of $1,520, with assignment of the stock of it is trading below $20 a good entry in my opinion.
     Tesla has the Model S rolling out July 2012, the Model X (SUV) will be announced shortly Dec/Jan and should be available Jan 2014 unless major production issues with Model S. I’ve toured the Tesla factor, have already agreed to purchase a Model S and will likely buy a Model X as well if it looks good. 
     I’d be willing to own TSLA @ $20 and and for the leverage capital returns 50% per year if it finishes above $45. While Elon Musk states he is not selling the company, and a GM agreement prevents it until the end of 2012, there is a buy out possibility…
     I’m curious what your thoughts are on this trade?

  103. AAPL/ITrade – I think $360 puts are cutting it a bit close and I think the spread is greedy.  If you are willing to own 1x of AAPL at $360, then you should be willing to own 2x at $250 and you can sell 2 2013 (why wait?) $260 puts for $15.50 ($31) and buy the $300/$350 bull call spread for $33 and that’s net $2 on a $50 spread that’s 100% in the money and the only way you DON’T make $8 or more is for AAPL to drop 20%.  All AAPL has to do is stay even and you make net $48 is flatline and THEN you can take your $48 profit and buy some aggressive spread (the 2013 $380 calls are $65 so you can spread them with the $525s at $18 for net $48 so that’s about what you can expect in 2014 a year from now).  

    Rather than chasing crazy gains, why not take a series of realistic plays that have a high probability of success.  You say you tie up $11,500 (this trade only uses $5,200 of margin plus the $3,300 cash) but you don’t make a thing below $380 and below $360, you are in a World of hurt so your exposure in a market collapse is huge and needs to be hedged – that’s another cost of the trade.  Not to get into it now but I have, in the past, discussed the relative wisdom of swinging for the fences or being a singles hitter and one point I make is that Dave Kingman hit 442 home runs and NO ONE think s he belongs in the hall of fame but pretty much EVERYONE who hits .300 lifetime makes it in because you don’t win championships, or build a winning portfolio – by swinging for the fences.  Babe Ruth batted .367 lifetime and walked (passing up opportunities to swing) more than anyone in history – we can’t all be Babe Ruth but there are 145 .300 hitters in the hall of fame out of 200 players and 50 of the other 55 are pitchers!  

    Bail-in/ZZ – Watch out when they start making up new terms to justify the BS!  

    78.32 – crisis averted for today!  

    Free Money/Peedle – Well, it depends on whether you can actually fill for that price and, of course, how much of that "free" .09 goes towards broker fees with a 3-legged spread in and out.  

    Hong Kong/Jabob – Seems like the most obvious thing in the World to be bullish on either Chinese currency and short the Dollar but, as we’ve seen recently, that dollar can burn your hands off when people panic into it so, like pretty much all currency trading – I’m not interested in playing.  

    TLSA/ITrade – That trade is more like what I like to see but, again, a greedy spread when you can sell the 2014 $20 puts for $5.50 and buy the $20/30 bull call spread for $6 and then you are net .50 on a $10 trade that’s 100% in the money now.  

  104. PLX – lightening up a bit.  Will buy back if they fall below $6.

  105. She obviously looks to say shocking things to get appearances and sell books not caring that her legacy will be of a disgusting human being that people will be saying the word good as the first word when one day they hear she has died.  She talks about how we should shoot OWS people like in Kent State.

  106. Speaking of PLX…one can buy the May $5/7.5 BCS for $1 or so, selling the Jan $5s for 30c.  70c on a $2.5 spread that is also 100% ITM.

  107. Coulter / Rustle – I guess she has a book coming out…

  108.  THANKS PHIL…
    Going to wait for a strong DOWN day to pick up both of those ideas!

  109. Hi, JRW,
    What’s your take on markets tomorrow?  Another leg up?

  110. FT:  "Mario Draghi, the head of the European Central Bank has made a key speech to the European Parliament, hinting at greater ECB action if governments moved towards a “fiscal compact.”  Same story, different day.

  111. Pharmboy, PLX is trading $6.18, $5/7.5 BCS is not 100% ITM.  mistype?

  112. Informative read…
    China boom turns Australia upside-down

  113. Phil, today i bought the edz 17/27 jan bull callspread at 2,20 and the strange thing was that as soon as i bought it i was losing 10% and even now i’m down 10%losing  with both of the calls. could you explain me why?thanks

  114. Top of the range here, clowns running the show are going to have to somehow kill the $ to break out.

  115. Here comes the 2:30 express !!

    Target SPX 1260 !!

  116.  indexes running up toward yesterday’s close.  Guess: if they break through and close higher, we go up.  If not, down.

  117. Phil,

    Your thoughts on an arb play on Pharmasset ? GILD will be buying them for $137 and the stock is currently trading at 129.50. Looking to sell the May 130 puts for $3.


  118. cwan120/ Tomorrow

    We’ll have to see where we close; but if we close red I think it will be down, fwiw !!

  119. oil got a nice goose into their close

  120. Good auto numbers helping the indexes go higher despite the Dollar back at 78.37

    11:40 AM Europe finishes a bit lower in choppy trade, giving back just a tiny bit of a breathtaking 3 day run. Stoxx 50 -0.8%, Germany -1.1%, France -0.9%, Italy -0.3%, Spain -0.3%, U.K. -0.3%. The euro +0.1% at $1.3458.  

    2:00 PM On the hour: Dow -0.1%. 10-yr -0.07%. Euro +0.16% vs. dollar. Crude -0.57% to $99.78. Gold -0.22% to $1746.45.

    Interesting facts from Bloomberg add perspective to yesterday’s rally: Adjusting for the market’s volatility in 2011, the Dow’s 490-point gain equals ~240 points in the first nine years of the last decade. During the past four months, the S&P 500 has moved 1.7% on average each day, vs. 0.8% before Sept. 2008. So far, today isn’t one of the volatile days: S&P +0.07%, Dow +0.05%, Nasdaq +0.19%.

    AAII’s Charles Rotblut offers perhaps the most understandable explanation of what yesterday’s coordinated central bank action means for investors: It doesn’t resolve the sovereign debt crisis, but it prevents a meltdown by providing more liquidity to keep banks afloat. There’s even a bit of advice: "Don’t wait for Mr. Market to give you the ‘all clear’ signal, because he won’t give it until well after stocks have rallied." 

    The latest rate report from Freddie Mac shows a 30-yr mortgage averages 4%, up 2 bps from last week. A statement from Freddie’s top economist – Frank Nothaft – saying that "extraordinarily" low mortgage may provide a boost to housing activity would be a little more heartwarming if it wasn’t just different wording of the same refrain that has been heard from govt. economists for over a year.

    Make no mistake, writes Patrick Chovanec, "the PBOC just handed back the punch bowl" by lowering reserve requirements yesterday. Chinese leaders don’t necessarily want to impose another credit-induced boom on top of the one just completed, but – with growth overseas slowing – find themselves in a box. "An unbalanced recovery is better than a balanced recession," said the vice premier recently.

    Sarkozy: "Retirement at 60 and the 35-hour workweek were grave mistakes … that we must repair … France is paying a heavy price." - There’s a solution for that.  

    Sarkozy: "The French welfare state must be adjusted in line with today’s realities." Thus far, the speech is more campaign talk than a new vision for exiting the debt crisis. Will keep any eye out for anything substantive.

    Sarkozy: He plans to meet with Angela Merkel in Paris on Monday following which a raft of measures "to guarantee the future of Europe" will be announced. He says no eurozone state will be allowed to default, and no saver will lose a single cent on loans to eurozone countries. Don’t laugh, traders are buying euros since that line hit.

    "It is already over for EMU, (policymakers) just don’t want to admit it," writes Kyle Bass to his investors. Most absolute and spread bond levels are greater than pre-Maastricht extremes, and CDS spreads on every country in the union imply multiple notch downgrades in the offing. ECB printing? Consider that the bank started buying Greek paper when it yielded 6%, now it’s over 30% and the troika owns 40% of it. 

    To help resurrect confidence, Germany will propose creating special national funds for euro sovereign debt that is over 60% of GDP. The wheeze sounds like an idea from the country’s "wise men," although they suggested the big no no of common liability. Also, will Germany have a fund given that its debt ratio is well over 60%?

    As Reuters and maybe others didn’t seem to believe it last time, the IMF says it again: "There are no discussions with the Italian authorities on any form of IMF financing." However, the fund is due to send a delegation to Italy to audit its country’s debt-reduction measures.

    Italy and Greece rank 69th and 80th on a Corruption Perception Index – not a total surprise since tax evasion and fraud have helped drive the debt crisis. New Zealand is seen as the cleanest, while the U.S. is 24th, behind Qatar. Given the latter’s shenanigans in the world of soccer, what does that say about the index?

    The Massachusetts attorney general sues Bank of America (BAC), JPMorgan (JPM), Citigroup (C), Wells Fargo (WFC), and Ally Financial over "deceptive conduct in the foreclosure process." The Mortgage Electronic Registration System, or MERS is also named as a defendant. 

    With at least 4,000 dead and an increasing numbers of defecting soldiers fighting against the government, Syria is now in a state of civil war, says Navi Pillay, the UN High Commissioner for Human Rights. 

    The EU agrees to explore measures aimed at "severely affecting" Iran’s financial, transport and energy sector, but in a statement they stopped short of mentioning oil sanctions. Notwithstanding, France’s Alain Juppe says the EU would "work on" a French oil embargo proposal. 

    More reasons to buy GLW:  The latest economic indicator: Sales of TVs are surprisingly hot. Wal-Mart (WMT) says TVs are among the top gifts people are putting on layaway. The Westinghouse 46-inch LCD HDTV that was on sale for 50% at Target (TGT) was a top seller last weekend. Prices overall have dropped 7% to an average $597, and big discounts are a big draw.

    The NOAA’s annual report on the climate in the Artic says the region is witnessing warmer air and water temperatures with less summer snow and ice. The agency says the amount of sea ice recorded by satellite was the 2nd lowest since 1979 in its sure-to-be-disputed summary of data. The thinly-traded Credit Suisse Global Warming ETF (GWO) is up 2.7%.

    Bad news for Cotton, good news for retailers? A deadly combination of a record global crop and falling consumption will continue to pound cotton prices and keep sentiment bearish in the trading pits, according to analysts. Standing to benefit are manufacturers and retailers: Levi-Strauss is cutting back prices to reign in price-conscious shoppers, while American Eagle Outfitters’ (AEO +0.4%) CEO highlighted the importance of the commodity to his firm’s bottom line in an earnings CC.

    More on cotton prices (previous): Is the key to the profitability for select retailers how well they are hedged against cotton prices plummeting? Though execs with companies such as GIL, RL, M, RUE, KSS, LIZ, and JCP have all recently pointed to the price of cotton as crucial, the underlying question is when can they actually outlive inventory and contracts to start realizing margin gains? Cotton +0.25%, -23% YTD.

    The shipping industry a looks like it’s in rough seas. Freight rates from China to Europe have sunk 39% since August due to weak demand and vessel oversupply, a trend that is on course to get worse as the order book for new ships represents 30% of the global fleet. Meanwhile, EU bank woes threaten the supply of trade finance.

    Todd Sullivan takes a look at’s (CRM) latest 10-Q, and doesn’t like what he sees. In addition to the deferred revenue weakness noted by others (I, II), Sullivan is critical of stock compensation expenses that continue to eclipse Salesforce’s guidance, partly due to strong insider selling, and the presence of ~$130M in CMOs and mortgage-backed securities on its balance sheet. 

    Among Gartner’s top IT predictions for 2012 and beyond is a forecast that, by 2015, cloud services will cannibalize up to 15% of the revenue of top outsourcing firms such as IBM, HPQ, INFY, and WIT. Gartner also predicts the investment bubble for consumer social networks will burst in 2013, and the bubble for enterprise social software will do so by 2014. (previously

    Angry Birds maker Rovio isn’t bothered by the widespread copying of its games and merchandise in China, seeing it as evidence of widespread consumer interest. "If you’re not copied, then there’s no demand," says Chief Marketing Officer Peter Vesterbacka. He also claims Rovio was comfortable turning down a $2.5B offer from Zynga on account of its superior growth rate. - Another example of how insane people are.  $2.5Bn is not enough to please Jerry Yang Jr. here… 

    Mark Hulbert views Walt Disney’s (DIS +0.4%) 50% dividend hike as a vote of confidence in the company’s future and a "very bullish development" for the broader economy: "Disney is in the entertainment business. Its profitability would suffer if the economy were about to go into a sustained downturn… to that extent, management’s vote of confidence extends to the economy as a whole."

    Chrysler (FIATY.PK) Nov. U.S. sales: +45% to 107,172 vehicles, in its best Y/Y sales gain this year. Total cars up 119% to 28,694; trucks up 29% to 78,478. Ram pickup up 8% to 19,739. Jeep Wrangler up 41% to 9,225. Grand Cherokee up 23% to 13,545. (PR

    Ford (F) Nov. U.S. sales: +13.3% to 166,865 vehicles, vs. Edmunds expectations of +12.1%. Cars -8.8% to 48,322: Fusion +13% to 19,912, Focus -10% to 11,735. Utilities +29.3% to 52,811: Escape +46% to 21,823, Explorer +217% to 12,888. Trucks +22.8% to 65,732: F-Series pickup +24% to 47,740. (PR

    GM (GM) Nov. U.S. sales: +6.9% Y/Y to 180,402 vehicles, vs. Edmunds expectations of +9.9%. Chevrolet up 9.6% to 128,907; GMC up 6.8% to 29,470; Buick down 7.2% to 10,880; Cadillac down 5.6% to 11,145. (PR)

    Honda (HMC) Nov. U.S. sales: -10.1% to 83,925 vehicles. Honda division -10% to 74,016: Accord -18% to 14,355, Civic -1% to 17,133, CR-V -14% to 16,426. Acura division -11% to 9,909. Total car sales -13% to 40,997; trucks -7% to 42,928. (PR)

    Hyundai (HYMLF.PK) Nov. U.S. sales: +22% to 49,610 vehicles. Sonata +12% to 15,668, Elantra +44% to 12,414, Santa Fe -12% to 6,129. (PR)

    Kia (KIMTF.PK) Nov. U.S. sales: +39.1% to 37,007 vehicles. U.S.-built vehicles: Sorento +0.5% Y/Y to 9,669, Optima +565% to 9,533.

    Mercedes (DDAIF.PK) Nov. U.S. sales: +55.2% to 28,255 vehicles, its best-ever November volume. C-Class +113% to 8,358, E-Class +2% to 5,095, Sprinter Vans +26% to 1,045. (PR)

    Nissan (NSANY.PK) Nov. U.S. sales: +19.4% to 85,182 vehicles. Nissan division up 21.5% to 76,754. Versa sedan and Rogue crossover posted November records, up 38% to 9,291 and up 27% to 10,845, respectively. Infiniti up 3% to 8,428. Cars up 14% to 51,891; trucks up 28% to 33,291. (PR

    Toyota (TM) Nov. U.S. sales: +6.7% to 137,960 vehicles. Toyota division +6.7% to 118,502; Camry +13% to 23,440, Corolla -0.5% to 16,115, Prius +49% to 15,208. Lexus division +2.4% to 19,458. Total cars +19% to 76,645, total light trucks -5% to 61,315. (PR

    The WSJ reports sources saying Google (GOOG) – facing a challenge from the success of Amazon (AMZN) Prime – is in talks with major retailers and shippers to create its own next day or even same-day shipping service. Among those possibly pitched are Macy’s (M), Gap (GPS), OfficeMax (OMX), and UPS. (previous)  

    More on Gartner’s predictions: In a positive for Google (GOOG) and Apple (AAPL), the firm forecasts mobile app projects, which are currently estimated to be on par with PC app projects, will outnumber PC projects by 4:1 in 2015. It also sees 50% of enterprise e-mail users relying on browser-based e-mail clients such as Gmail by 2016. 

    As Barnes & Noble (BKS -19.2%) crashes on account of weak FQ2 results and FY12 guidance, Best Buy provides another piece of discouraging data for the company: the Nook Tablet is only the 8th-best-selling tablet on Best Buy’s site, 7 spots below the top-ranked Kindle Fire (AMZN). The iPad (AAPL) is likely the most popular tablet overall, given that over a dozen models are listed.

    The power of Google (GOOG +1.8%): Politico takes note that the beleagured Herman Cain campaign spent money to place ads on Google’s search engine results page for the scandal-related query of "Ginger White." A quick check on Bing (MSFT -1.1%) shows nary an ad – more proof of how seach engine dominance ties into revenue and a reminder that when all is said and done Google can be considered a verb and Bing is only a noun.

    Big Brothers are watching you!  Mobile apps developer Trevor Eckhart posts a video showing what he says is "conclusive proof" that Carrier IQ software installed by manufacturers on Android (GOOG), Nokia (NOK) and Blackberry (RIMM) devices is secretly tracking users’ key strokes, Google searches, and text messages, as well as their locations

    Three lunchtime reads:
    1) 5 big buys and 2 big sells by David Einhorn
    2) Stern: China’s superior economic model - Good Communist reading! 
    3) Alan Blinder: Rethinking the financial system

  121. PLX – ~70c for the spread makes it $5.70…which is 100% ITM.

  122. EDZ/TraderM – You are losing 10% because your broker gives you the worst possible combination of the bid/ask.  In TOS, you can set your portfolio up to report last sales to track balances, which is more useful but I’m not sure if other brokers do this.  Anyway, if watching an option spread move up and down 10% worries you – you shouldn’t be playing them!  It’s like buying a car – the minute you drive it off the lot, it loses 20% of it’s value – does that mean you should never buy a car or if you should ignore the PRICE of something if you believe in the VALUE of it?  Personally, of course, I don’t buy new cars for that very reason – much better investment to buy used cars and re-sell them when you are bored.  But, you can’t buy used options so you just try to get the best price and make sure you have realistic expectations for whether you are on or off target.  

    VRUS/Oncmed – Well GILD has the money and it’s a cash offer so the discount is based on the subject to approval part of the deal.  If the deal does fail though, it could be back to $70 overnight so I hope you REALLY love the idea of owning VRUS after it’s either been shot down by regulators (doubtful) or demonstrates the shareholders are stupid by turning GILD down (possible) or that GILD turns up some scandalous issue that’s bad enough to stop the deal.   So, for $3 you are giving yourself a whole lot to worry about for the next 6 months.  

    It looks to me like you can sell the JAn $70 puts for $2 because I’m not the only guy who thinks it might blow up – don’t you think $60 of buffer is worth not collecting $1 for?  In fact, you can sell 2x of those for $4 and it’s not much worse if put to you.  

    Oil/Sage – Very nice of them as we can short the Futures again!  

  123. Pharmboy - looks like our VIAP is going to zero. And I have way too much of it.  You?

  124. PHil, getting back to your 11:15 trade suggestion:

    20 DIA Dec $116 puts at $1.14 in WCP with a stop at $1 (over 11,200). 
    Shame on you if you missed SCO!  Game on for oil (/CL) below $100!  
    Did you mean over $12,100?  Anyway, the DIA $116 puts are already at 1.00 with the Dow at 12,042
    Reg oil, what is the equivalent USO strike level to buy when oil dips below $100:?   Thanks!

  125.  am willing to short a move up to 1260ish…  willing to buy 1215ish…not see edge to either side right now….of course… $ key….see how market has drifted lower past hour as the dollar strengthens….$ chart… though… resembles a bearish rising wedge – which favors a break down…. only question is whether or not the dollar puts in one last move higher first….

  126.  stopped out of the dia puts at .99—--that said now get ready for a move down

  127. VIAP/mrm – no, I sold it in the 2-3c range.  That is too bad…MRK, AZN, and of course my company all have/had compounds at the target, but the trials are VERY expensive and risk is not worth it. 

  128.  TLT rocking upwards.

  129. Employment data tomorrow, and the last few weeks were revised up (did anyone notice that?)…I wonder if they take us up to get short puts to take us down?  How many actually fall off the numbers who were kicked out of the system.

  130. CMG having it’s own private stick party…

  131. Pharmboy/PLX, got it. Thx.

  132.  Oh Duh!  It’s the dividend that’s creating the spread.  So make 9¢ on the put loss 9¢ on the short.

  133. CMG – 300/280 Jan P spread for 3.55.  H&S forming…and I don’t think they keep it up.  Just a few.

  134. DIA/WCP, Jerconn – No, I meant 12,000 – no idea where my brain was then.   Anyway, the $1 stop was the key thing and it tripped.  

    USO/Jerconn – $100 on oil seems to be about $38.50 on USO at the moment but that changes over time as the fund rebalances.  

    78.41 and we’re holding up pretty well so far.  

    Bolger/Angel – I favor cash, much less deciding and you can stuff a scarecrow with it when we have hyperinflation.  

    Move down/Savi – I really hope not as we just have our two oil shorts covering the WCP now.  I’m really concerned about NFP tomorrow but the strength today gives us more buffer than I thought we’d have.  

    Fall off/Pharm – Figure 13M counted as unemployed and 2-year roll so about 4% drop off their count each month as they go from unemployed to "retired" or "discouraged" or "homemaker" or whatever they do with the people they no longer count.  

    CMG/Mr M – And didn’t that new Shop House not do so good?  

    78.43 – that’s going to keep Mr. Stick at bay.  

    107M on the Dow at 3:45 is very low.  

  135. Thx for the Volume Phil.  Buying some SPX Mar 1200/1100 Ps.  Yikes, I am going to be WAY short come the New Year!

  136.  Pharma… is that a hedge?  buy 1200′s sell 1100′s?  what are you paying for that?

  137. peedle – yes, about 2500/contract.  Same can be done in SPY.

  138. This was not in the "Coordinated Program" and does not bode well for tomorrow; and it’s too late to trade !!

    Well, they say things happen in 3′s; perhaps we can have a gangbuster trading day tomorrow to make up for failing to see any profits for the last 3 days !!

  139. I wish I felt more confident about tomorrow but I don’t.  

    Oh well, we’ll find out in 18 hours!  

    And what JRW said.  

  140. It is not really a hedge, per se….I am short this frickin’ market, and will not be shaken out…..

  141. Gingrich in 2007 Lauded Freddie Mac

    Presidential candidate Newt Gingrich touted the virtues of Freddie Mac’s business model in an interview with the company in April 2007, remarks that appear at odds with his recent statements that he had warned the company of impending financial disaster. 

  142. The big known unknown tomorrow is jobs… that could sway the market either way!  

  143. Gingrich / Phil – Like you said, how can these guys have any credibility left?

    Barney Frank;s view of the GOP in Congress:

     "It consists half of people who think like Michele Bachmann and half of people who are afraid of losing a primary to people who think like Michele Bachmann and that leaves very little room to work things out."

    Speaking of Mish, she wanted to close the US Embassy in Iran that has been closed since 1979! You would think that a member of congress would know that. And people want these guys to run the country. Unreal! 

  144.  Overcoming a multi-decade long distaste for Hillary Clinton, I have finally admitted to myself that she’s head and shoulders above the rest of the pack in talent and leadership potential.  That may be because the rest of them are midgets, but so be it.  And that’s a hell of an admission, coming from conservative Republican [small r] of  slightly misogynistic stock.  But when the facts change, you change your mind, as Keynes supposedly uttered in the British Parliament [sorry, "English" parliament, O!].

  145. stj/jobs..recent data points to fabulous.

  146. Phil, i talked with Tos in order to set my portfolio up as you said. they told me they have no feature. they said the mistake was to buy the spread at the market and not using limit orders. Better to make limit orders next time?Thanks

  147. Pharm – any particular reason to lighten up on PLX? I thought it was your retirement $. :)
    Going to KC MO tomorrow to visit & help with some house renovation.

  148. Phil, this is one "Top 0.1%" guy who makes an argument heard many times on this site:

    Since 1980, the share of the nation’s income for fat cats like me in the top 0.1 percent has increased a shocking 400 percent, while the share for the bottom 50 percent of Americans has declined 33 percent. At the same time, effective tax rates on the superwealthy fell to 16.6 percent in 2007, from 42 percent at the peak of U.S. productivity in the early 1960s, and about 30 percent during the expansion of the 1990s. In my case, that means that this year, I paid an 11 percent rate on an eight-figure income.

    One reason this policy is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the average American, but we don’t buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, I go out to eat with friends and family only occasionally.

    It’s true that we do spend a lot more than the average family. Yet the one truly expensive line item in our budget is our airplane (which, by the way, was manufactured in France by Dassault Aviation SA (AM)), and those annual costs are mostly for fuel (from the Middle East). It’s just crazy to believe that any of this is more beneficial to our economy than hiring more teachers or police officers or investing in our infrastructure.

    I can’t buy enough of anything to make up for the fact that millions of unemployed andunderemployed Americans can’t buy any new clothes or enjoy any meals out. Or to make up for the decreasing consumption of the tens of millions of middle-class families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages.

    If the average American family still got the same share of income they earned in 1980, they would have an astounding $13,000 more in their pockets a year. It’s worth pausing to consider what our economy would be like today if middle-class consumers had that additional income to spend.

    It is mathematically impossible to invest enough in our economy and our country to sustain the middle class (our customers) without taxing the top 1 percent at reasonable levels again. Shifting the burden from the 99 percent to the 1 percent is the surest and best way to get our consumer-based economy rolling again. 

    The entire article is worth a read!

  149. Jobs / Kustomz – The correlation between ADP and the job numbers is tenuous at best! The weekly numbers have not been that great. Maybe more people are re-entering the market. Who knows. Only 16 hours until we know! 

  150. This guy has the answer.

  151. Tradermoksha – as a new member myself, I can remeber reading about what Phil had to say on market orders in the Strategy part of the website:
    Never, ever, ever put in market orders. Never, ever, ever, ever…
    Did I say Never? Never, ever, ever…
    OK, moving on. Never put in market orders – THEY will steal your money every time.


    Capitalism is not the source of our problems, as an economy or as a society, and capitalists are not the scourge that they are too often made out to be. As a group, we employ many millions of taxpaying people, pay their salaries, provide them with healthcare coverage, start new companies, found new industries, create new products, fill store shelves at Christmas, and keep the wheels of commerce and progress (and indeed of government, by generating the income whose taxation funds it) moving. To frame the debate as one of rich-and-entitled versus poor-and-dispossessed is to both miss the point and further inflame an already incendiary environment. It is also a naked, political pander to some of the basest human emotions – a strategy, as history teaches, that never ends well for anyone but totalitarians and anarchists.

  153. Credibility/StJ – I think it’s horrifying that one of these people (other than Mitt, who’s relatively fine) can possibly be President. 

    Hillary/ZZ – I was very upset when she fell behind Obama in the last election – she would have made an excellent President.  Going to be a bit long in the tooth in 2016 at 69.  

    TOS/TraderM – Oh ALWAYS use limit orders.  Market orders will screw you every time!  You need to look at the last sales yourself then and decide what a realistic price is for each contract.  When I name a price for a spread, that’s the price I think is realistic at the time I look at it.  If you are patient, you can usually do better but doing worse means you are better of not trading if it’s more than 5% higher as those 5%’s add up pretty fast!  

    Hanauer/StJ – Well that sums it up very nicely!  

    At the close: Dow -0.25% to 12015. S&P -0.2% to 1244. Nasdaq +0.65% to 2310.
    Treasurys: 30-year -0.35%. 10-yr -0.02%. 5-yr +0.112%.
    Commodities: Crude -0.29% to $100.07. Gold -0.1% to $1748.55.
    Currencies: Euro +0.11% vs. dollar. Yen +0.11%. Pound +0.13%.

    Market recap: Stocks took a breather following yesterday’s rally, failing to add to gains after Merkel reaffirmed opposition to an expanded ECB role in solving Europe’s debt crisis. JPMorgan and other banks were hit by a Massachusetts lawsuit against five big mortgage lenders. Automakers posted strong sales, and retail stores posted mixed results. NYSE decliners led gainers three to two. 

    Sounds like someone was caught short this week!  No more sugar-coating for George Soros, who says the global financial system is in a "self-reinforcing process of disintegration" with "consequences that could be quite disastrous. You have to do what you can to stop it developing in that direction." He’s optimistic on the Middle East and Africa though, seeing them escaping the "deflationary debt trap the developed world is falling into." 

    Kass: The Expected Responses from Bears & Bulls (The Street)

    Timothy Geithner delivers some comments on the risk of future financial crises at a conference in DC that come across as one part apologetic and two parts fatalistic: "Policy makers are always looking for the financial system equivalent of the MRI; over-the-horizon radar, the kind we put on aircraft carriers…that goal will always elude us."

    Fundamentals Weighed Down by Fears (WSJ

    This is not a government finance crisis, writes Ambrose Evans-Pritchard, but a monetary crisis caused by an ECB that choked off recovery by hiking rates this year and now refuses to step in and arrest a shrinking money supply. Solving a monetary crisis doesn’t require austerity or eurobonds or anything else other than the ECB doing its job and printing euros, lots of them. - Yeah, what we need is MORE FREE MONEY!!! 

    It’s that time of day. Picking up on Mario Draghi’s earlier comments that the ECB may be ready to pull more weight, the WSJ’s Simon Nixon has a source saying the bank is weighing a plan to explicitly target certain levels of government bond yields. Should the markets test that bazooka, it would force the ECB to literally print enormous sums to back the debt of each EU state. 

    How Austerity is Killing the Euro (Time)

    Chilean central bank chief Jose De Gregorio suggests a change in policy is on the way saying, "we may need a bigger monetary push than at present," in response to events in Europe (and, no doubt the slowdown in China). On the fence for months as other emerging economies have cut, Chile could lower rates as early as December. ECH -1.3%.  

    Some 2012 predictions from CNBC’s Herb Greenberg: the start of a turnaround for J.C. Penney (JCP) under Ron Johnson; restructurings at Sears (SHLD) and Best Buy (BBY); K-Cup knockoffs proliferate as patents on Green Mountain’s (GMCR) K-Cups start expiring; Netflix (NFLX) is acquired by Facebook. That last one actually may have caused a late-day bump in NFLX shares. 

     Arne Alsin believes stocks are the asset class to own for the rest of this decade, and that General Electric (GE) is especially attractive now: "You simply can’t find a historical precedent for the current situation… The factors that served to depress GE earnings to subnormal levels – such as the capital overhaul and business reconfiguration at GE Capital – are fading remarkably fast."

    LCD panel maker AU Optronics (AUO +5%) is up strongly for the second straight day. Today’s move could be the result of positive comments from Chairman K.Y. Lee, who thinks prices for certain TV panels will bottom out soon, and that strong holiday sales could lead some TV makers to speed up their 2012 product launches. Weak panel pricing has taken a toll on AU Optronics’ shares this year.

    Is Microsoft (MSFT) now a value stock? Quite possibly, Eddy Elfenbein explains: The stock currently goes for 9.24x expected FY2012 EPS of $2.75, while the S&P 500 now goes for 11.17x expected S&P earnings of $101.73 over those same four quarters – meaning Microsoft’s valuation is 17% less than the overall market’s. 

    MKM’s Michael Genovese’s checks among IT resellers indicated recent "positive order momentum" for data center networking gear continued in November, in spite of bad macro news. Businesses continue to invest in areas such as 10-Gigabit Ethernet, virtualization, cloud computing, and security, and that leads Genovese to reiterate Buy ratings on CSCO, RVBD, and FFIV. (yesterday

    Thomas Lott’s extensive analysis (Part I, Part II) of Vodafone’s (VOD) assets leads him to believe upside of 24%-27% is possible over the next 12-18 months, after accounting for the carrier’s large dividend. Some fairly conservative multiples are used in valuing Vodafone’s properties; its 45% stake in Verizon Wireless is valued at just 6x EBITDA; its European assets at 5x; and its other international assets at 6.25x.

    Research In Motion (RIMM +4.1%) is rallying on another round of buyout buzz. Caitlin Duffy notes options speculators are placing big bets on December calls – some of which expire tomorrow. Nomura’s Rick Sherlund, however, is throwing cold water on the sometimes-discussed notion that Microsoft (MSFT) might be interested in RIM, and Eric Savitz is even more skeptical of such a tie-up occurring. (previously)

    Hewlett-Packard (HPQ +1.3%) is upgraded at Pacific Crest, which asserts that the risk/reward in the stock is now in balance after big Street estimate cuts. H-P still enjoys a central role in IT, based on a CIO survey showing 49% plan to increase spending on HP’s wares in 2012 as a percentage of their budgets. Plus, there’s faith in Meg Whitman’s turnaround ability.

    Are you McSerious?: After San Francisco adopted a law forbidding local Mickey D’s (MCD -0.4%) from giving away toys with Happy Meals, the company fires back by tacking on a $0.10 charitable donation on sales to legally skirt the ban on incentivizing unhealthy meals. It’s a classic case of regulation gone awry, says health economist Adam Powell, noting that parents may feel even better about buying Happy Meals with altruism bundled in nicely – not to mention they avoid the unpleasant task of trying to explain the toy ban to expectant youngsters. 

    YouTube (GOOG) is rolling out a major revamp of its site, one that emphasizes TV-like channels and a Facebook-like activity stream rather than individual videos. YouTube has already announced channels delivered by professional content sources, but today’s overhaul is also focused on enabling users to create their own channels. Barclays estimates YouTube will generate $1.6B in 2011 revenue. (previously

    File under algorithms for the lazy shopper: Wal-Mart (WMT -0.4%) says the brainy developers at @WalmartLabs have cooked up a Facebook app called Shopycat to help users buy better gifts for their friends by mining through the endless data on the social networking site. The firm promises to follow up on Shopycat with more in-store and online social developments.

    Apple (AAPL) says it is phasing out use of tracking software that has raised privacy concerns following reports claiming some smartphones record and share extensive personal information. Apple says it’s not supported in the iOS 5 mobile operating system released two months ago, and plans to "remove it completely" in a future software update.

    Enterprise iPad (AAPL) adoption is gaining steam, and it appears executives, rather than IT departments, are primarily responsible. Cloud collaboration software maker Huddle finds execs are increasingly bringing their iPads to meetings for note-taking purposes. Forbes’ Tom Taulli thinks ego is helping stoke adoption. "The tablet is corporate bling for executives." 

    Sears (SHLD -5%) dips lower after it says it will hold a special sale Friday and Saturday offering steep discounts on some of its popular categories as the retailer attempts to lure holiday shoppers. Some of the deals it’s going to offer will be even better than its Black Friday discounts.

  154. Thanks Ceegee – that needs to go in the Wiki!  

    Capitalists/Pstas – Hmm, let’s see what a little editing can do for this:

    Crony Capitalism is the source of our problems, as an economy or as a society, and these capitalists are the scourge that they are often made out to be. As a group, they have fired many millions of taxpaying people, reduced their salaries, and cut their benefits, while preventing the start of new companies, shipping entire industries overseas, using patent legislation to prevent new products from competing with what they already sell, filling store shelves with stuff from China (and crowding out the possibility of US-made goods hitting the shelves), while using "the wheels of commerce"  (and their ability to buy off the government, avoiding taxation but spending billions on lobbying) to grind real Capitalism to a halt.

    To frame the debate as one of rich-and-entitled versus poor-and-dispossessed is exactly the point and hopefully will fan the flames necessary to bring about real change in our crumbling National environment.  It is also naked, shameless, political propaganda for the rich and powerful to use their PR people to plant stories painting themselves as heroes on Conservative-friendly publishing sites where dittoheads will distribute it as if they have discovered some sort of universal truth.  Greed is, by far, the basest human emotions – a strategy, as history teaches, that never ends well for anyone but totalitarians and, of course, so far, the top 1% oligarchs who have seized control of the United States of America.  

  155. Phil/Crony Capitalists
    Thank you! I was sitting here fuming, but I knew you could say it so much better than I! Providing healthcare and filling the shelves--indeed.

  156. ZZ-Phil-Hillary
    She was a completely lame candidate in the Democratic election process. Her chief claim to fame was that as First Lady for 8 years she had been a close kitchen cabinet advisor to the President and an important figure behind the scenes.
    This was completely undermined by silly lies she told about visiting an airfield in Serbia, because it was too dangerous for the President to go, when her own husband had been to the same airfield months earlier.

  157. ZZ-Phil-Hillary continued
    She also hugely exaggerated her role in the Northern Ireland peace process. If these two examples of her role were the best she could come up with, then her claim to be a close advisor to the Pres was completely negated as she could not show any examples where she had been a significant influence in presidential policy.
    Furthermore, as Senator for the safe seat of New York she had been in prime position to lead the opposition to the Iraq war, but totally failed to assume leadership or to address the valid objections to the war raised by Obama (cost, duration, objectives), all of which proved to be correct. Some say that as a woman she wanted to ¨look tough¨, but that is not leadership. Thatcher would never have acted because she wanted to ¨look tough¨. She thought men were idiots anyway.
    If Clinton could be so easily fooled by George Bush, what use would she be in dealing with Ghadaffi or Ahmadjinebad?
    Now she is jetting around the world looking like a bag lady. Can she not afford a hair stylist? At one time I did consider voting for her, but I voted for Obama because he seemed to be in touch with reality. Of course he has been a disappointment too.

  158.  StJ:  Nic Hanauer, the Repentant Fat Cat:     What Mr. 0.1% confesses is certainly true — he is very unlikely to consume enough to compensate for hundreds and thousands of Average Americans with average incomes.  On the other hand, raising taxes to any given level is not the same as "returning the money to wage earners", because "non-wage earners" vote, too, and there are, broadly defined, more of them than working people.  
    U.S. congressmen and senators, do two things.  They accept campaign contributions from big corporations through their PACs, and they buy popular votes with promised acts of beneficence. They must do this because corporations may be "people" haven’t  [yet] acquired the right to vote.  And they do it through entitlement programs and by pandering to every ignoble or jingoistic impulse of these voters.  They don’t promise to lead, they promise to follow the popular will.
      I am in favor of a humane society — but not at a price that threatens to destroy the long-term competitiveness of the country through entitlement programs for which the government must fund through borrowing, some of them mathematically impossible to sustain on the basis of any reasonable growth assumptions.   If I had a guarantee that every dollar more I paid in taxes would go to re-building U.S. infrastructure or would be spent on effective education, I would gladly pay it. Perhaps if only working people could vote, I would gladly pay it — sounds pretty reactionary, almost feudal, right?     
     But nothing of the sort is true.  What is true is that I don’t trust our political class with my money.  Watch a few televised debates — would you happily hand your money to those cardboard cutouts, vying among themselves to most effectively trigger every fear and reactionary sentiment harbored by the voters?   Would you assume they would "put it to good use?"  Or would they use it to build a 2,000 mile, 20 foot, $20 Billion wall across our Mexican border and staff it with Homeland Security officers, as "payback" for the popular vote?
     You will recall that the newly-founded republic of the United States only permitted land owners to vote.  We laugh at how primitive and backward they were, how we have "evolved" into a more representative, fair and democratic system.  I wouldn’t assume that.  I realize this sounds terribly reactionary — and I am very liberal from a social standpoint — but every time I watch Newt or Rick or Michelle or Sarah or Mitt or Twit standing on the podium trying with difficulty to locate Afghanistan on a map — where we have young men dying every day —  I have trouble convincing myself that simply sending them more tax dollars would remedy the crumbling social, cultural and intellectual ethos on which the country was founded. 
     Not every problem can be quantified, because not every problem can be reduced to quantities.  Yes, the rich don’t pay enough taxes, agreed.  But what if they did?  Will George Washington or Abe Lincoln then rise from the grave? When all you have is a hammer, every problem looks like a nail. Admit it or not, our problems go deeper than deficits.

  159.  Point taken on Hilary.  It’s a political desert out there, Jmm…

  160.  pstas,
    That Cooperman letter to Obama really irked me.  Note to Cooperman: keep your stinking charity. He totally misses the point.

    The real argument about the wealth divide isn’t, as he suggests, that rich people aren’t generous enough, or didn’t work hard…  the argument is that the system is so out of balance that virtually all the wealth now flows to the top.  And it didn’t just happen.  It was deliberately engineered to produce giant returns for one particular industry.
    This engineering is perfectly described by Steve Waldman:
    Cash is not king in financial markets. Risk is. The government bailed out major banks by assuming the downside risk of major banks when those risks were very large, for minimal compensation. In particular, the government 1) offered regulatory forbearance and tolerated generous valuations; 2) lent to financial institutions at or near risk-free interest rates against sketchy collateral (directly or via guarantee); 3) purchased preferred shares at modest dividend rates under TARP; 4) publicly certified the banks with stress tests and stated “no new Lehmans”. By these actions, the state assumed substantially all of the downside risk of the banking system. The market value of this risk-assumption by the government was more than the entire value of the major banks to their “private shareholders”. On commercial terms, the government paid for and ought to have owned several large banks lock, stock, and barrel. Instead, officials carefully engineered deals to avoid ownership and control.

    The real problem is that all the plumbers kids in the south bronx today are much less likely to have the same opportunity as Cooperman.  If free markets were allowed function again wealth would distribute more evenly, and quite a few less people would need Cooperman’s charity.  Crony capitalism is killing the middle class, and no Democrat or Republican seems to have any clue what to do about it.

  161. Phil/EDZ:
    "EDZDC – I always like EDZ as a hedge when it’s low ($18) so a current play on them would be selling the Jan $18 puts for $2.70 to pay for the Jna $17/27 bull call spread at $2 for a net .70 credit on the $10 spread with 1,614% of potential net upside against the danger of being long on EDZ at net $17.30 (if EDZ drops 10% and you don’t roll the short puts)."
    What about a 2x Jan 17/22 bcs hedge for 2 x 1.35 (2.70) with the offset of the Jan 18 puts for 2.70 for a net zero, but there is a much higher probability of getting the full payout on the 2x 17/22 vs the 1x payout on the 17/27?

  162.  Phil,
    What do you make of the "no losses" talk out of Europe?  Is this even remotely possible?  Should we all be buying Portuguese bonds?
    Also don’t really know how I ended up with a quote mark on my last post.

  163. zeroxzero:
    So we sit tight with our hands folded waiting for someone to promote something in our own self-interest, whom we vote for. All along waiting for that perfect candidate. The good fact of the matter is that good leaders only come every so often and certainly not often enough. In the mean time, we can only hope that the idiots in between don’t do anything drastic, don’t piss off our neighbors and start a war, and hopefully maintain some sense of order until the next savior shows up and restores hope and direction at least for a little while. It won’t be next year, but who knows who is around the corner. It is amazing that we have lasted this long. I enjoy your prose.

  164. Zero – Let’s not go to the "poll tax" again… So students and retirees are left out of the political process! Should we also test income and IQ. Sorry, I am only jesting there! By the way, if a corporation didn’t pay any taxes the previous year (or received subsidies), should they be able to lobby politicians? Fair is fair?

    I agree that our problems are deeper than just a deficit, but you would not know it listening to the buffoons running for president on the GOP side or their colleagues in congress. There are many problems with our country, the biggest one being the money in politics – stop that and many of our problems are fixed! And entitlement programs don’t have to hurt the competitiveness of a country. Look at Germany for example, their export industry doesn’t seem to be hurting from the social safety nets offered to their workers. Sure, reforms are needed, most urgently in healthcare. Looking at many studies, Social Security could be fixed very easily with small incremental changes. But Medicare and Medicaid are problematic. So we can address those, but not in a way that will make it that the middle class will be left in the cold as with the Ryan plan for example. And we have to ask sacrifices of the bottom 50%, we better ask for something from the top 10% as well! We have profited very handsomely in the last 20 years, so let’s give back some. Yes, some of us worked hard for our money, others started from nothing, but we were all lucky along the way either through an intellectual gift, a good education or an unbelievable opportunity. Pretending otherwise is at best naive, at worse cynical. That luck not given to everybody and we have to recognize that. It irks me to hear a guy like Gingrich again today basically repeating that old GOP meme that poor people are poor only because they don’t work hard or have no work ethics. It’s insulting to the 50 millions people in this country who are struggling around the poverty level despite working a real job (and sometimes 2 jobs) because they were not as lucky as all of us! Someone’s got to flip burgers, mow lawns and clean houses. And you don’t get rich doing that! 

  165. Auto sales have really bounced back:

    But it’s amazing that we are still running at least 2-3 millions cars behind the early 00′s. Sometimes in the near future the US car pool will get old quickly and we will need a boat load of new cars. In the last 4 years, we have sold close to 20 millions fewer cars than in the first 4 years of the century. And we are still running behind.


  167. And one last one for today…Jeff Danziger 

  168. The honey talk the other day motivated me to search for some local honey. Here in the land of Cargill  (MN) there is a supplier named Lamex foods (great name). We could get a tanker of it ! Here is the minimum order:

    Wholesale – Bulk

    Smallest quantity shipped: 40,000 lb container

  169. stjeanluc
    All auto mechanics I know, claim that starting from 2000-2001 cars made big jump in terms of durability.
    Average car currently is at least 1.5 times more durable then in 80s-early 90s.

  170. I run around in a GMC 2000 Yukon with 180,000 miles and a 1999 Pontiac Grand Prix with 180,000 miles. Both run fine. I have thought about a new used car, but why when those two old dogs keep humming. In my business I have a 2000 GMC Safari van with over 340,000 miles that still runs great and a 2002 Ford Focus with 247,000 miles where the body will probably give out before the motor. They do seem to last longer.

  171.  DC:  And I very much appreciate yours.

  172.  While the subject is vehicles, I would ask for opinions regarding the best snow and ice SUV-type vehicle. We get an immense amount of snow.   I had a Lexus mid-size some years back with lots of anti-traction software that made for some interesting non-linearities in ice conditions, but I could use a bit more room and also have "equipment envy" for GMC-type stuff with 3 inchs lifts and giant mudders. We are allowed titanium spikes in the tires from October through April.  I would swap out the tires for summer driving, so it needs to do all-season duty.

  173. Good morning! 
    Oil at $101 again so a short off this line is a bonus (/CL)!  

  174. Futures looking good otherwise.

    Hang Seng had a 200-point stick into the close or they would have closed red – down 250 at one point.  Nikkei up half a point, Shanghai down 1% and BSE up 1.6% – Asia is just like a random number generator these days…

    Europe, on the other hand, is up 1.25%ish across the board and we’re heading into the best week in the last 3 years now if this keeps up.  Our futures are up about a point but oil just got rejected at $101 while gold is still $1,750 with the Dollar at 78.34.  

    $100.63 now so we lock in a stop at $100.75 – not bad.  When we cross $100.45, we drop the stop to $100.50, etc…  

  175. There’s only one thing going on today but it’s the Big Kahuna:

    Friday’s economic calendar:
    Monster Employment Index
    8:30 Nonfarm Payrolls

    3:17 AM The major Asian stock indexes are mostly higher after U.S. manufacturing expanded more than forecast, and ahead of a speech by Angela Merkel on Europe’s debt crisis. The MSCI Asia Pacific Index is +3.1% and is set for its biggest weekly gain since August 2007. Japan +0.5% to 8644, Hong Kong +0.3% to 19057, China -1.1% to 2361, India +1.4% to 16709.  

    3:47 AM EU shares open higher, apparently on hopes that the eurozone can be saved at yet another summit next week, and ahead of an expected positive jobs report in the U.S. payrolls. Euro STOXX 50 +1.7%, London +1.4%, Paris +1.9%, Frankfurt +1.5%, Milan +1.9%, Madrid +1.5%. Just as happily, Spanish and Italian bond yields are down.

    Republicans strike again!  The Senate last night blocked a Democratic plan that would have extended and expanded the payroll tax cut that is scheduled to expire on Dec. 31.  Republicans particularly objected to a new tax on the wealthy to cover the $110 billion in projected lost revenues from continuing the temporary tax cut.  Following the votes, President Barack Obama said in a statement, "It makes absolutely no sense to raise taxes on the middle class at a time when so many are still trying to get back on their feet." He urged Congress to come to a deal to extend the payroll tax cuts.  The White House, investment banks and some economists have warned in recent days that U.S. economic growth could suffer in 2012 if the tax cut for workers is allowed to expire.

    US Debt/GDP Hits Post WW2 High 99.5% Following $55 Billion Overnight Debt Increase: Total Debt Now Over $15.1 Trillion.

    "Resolving the sovereign debt crisis is a process and this process will take years," Angela Merkel says in a speech to the German parliament. The problem is that the eurozone might only just have over a week, with EU commissioner Olli Rehn saying on Wednesday that the bloc was entering a "critical period of 10 days." 

    Why Do Foreign Banks Need Dollars? see also (Economix)

    More on Merkel: "We need budget discipline and effective crisis management mechanism. So we need to change the treaties or create new treaties," she argues, saying that Europe is working towards setting up a "fiscal union."  

    More on Merkel: She again rejects the notion of eurobonds and money printing by the ECB, and says the German constitution does not permit devolving budgets to a European institution. So tighter discipline but no devolving of budgets? Sounds like a recipe for the eurozone’s continued success. - Gosh, remember when Germany rejecting Eurobonds would send us down 300 points?  Ah, those were the days…

    German Fears About Inflation Stall Bold Steps in Debt Crisis. Many economists say aggressive purchases of the sovereign bonds of heavily indebted states by the European Central Bank are the quickest and surest path to stabilizing the crisis. On Thursday, Mario Draghi, the bank’s president, laid the groundwork for bolder intervention in markets if certain conditions were met. To German ears those bond purchases, or anything that smacks of printing money, sound like a recipe for skyrocketing prices.

    Pumping dollars into Europe may bolster confidence for a bit, but will fizzle unless Europe’s policymakers and the ECB act more forcefully to shore up the eurozone’s overly indebted governments, FT writes. Felix Salmon concurs: “ECB’s status as lender of last resort is much more dubious… so it needs to come out and actually do these things if the market’s going to believe that they’re real." 

    Return of the Credit Crunch: Caught in the Grip. “The credit market is not functioning right now,” says Guillermo Amann at Ormazabal, a Spanish maker of electrical components. “There is no money. The situation is becoming worse and worse.”It is a complaint that is being made across Europe and, increasingly, in the rest of the world. Sir Mervyn King, governor of the Bank of England, warned this week of “early signs of a credit crunch, with concerns that it will get worse”.

    "The idea that China should save Europe does not stand," says Chinese Vice Foreign Minister Fu Ying, providing one of the country’s strongest rebuttals yet that it should use its $3.2T forex reserves in this way. Fu also rather pointedly says, "We cannot use this money domestically to alleviate poverty." 

    Next crisis:  China’s Stocks Decline on Economic Concern, Head for Fourth Week of Losses. China’s stocks (SHCOMP) fell, pushing the benchmark index towards a fourth week of losses, as sliding property prices and the slump in manufacturing added to concern the economic slowdown is deepening.

    Shanghai Home Sales Plunge to 6-Year Low in November. Transactions by area slump 53% y/y to 450,000 square meters last month, citing data from Shanghai Deovolente Realty. Sales were 36% lower than during the same time in 2008. Average home prices fell 6.6% y/y in November to 20,988 yuan per square meter. November new home transactions fell 39% y/y to 6,683 units in Beijing, the biggest drop among top 4 cities, citing Centaline Property data. Beijing’s daily average sales of used-homes fell 56% y/y in Nov to lowest in 35 months.

    Fitch: Chinese Banks’ Cash Buffer Thinning as Liquidity Erodes. Fitch Ratings says that the weakening of bank asset quality in China is unlikely to fully appear in NPL ratios until well into a deterioration, if at all, as the authorities pursue a selective policy of forbearance and support for distressed borrowers. Instead, loan delinquencies will manifest themselves first as liquidity stress, as cash inflows from distressed borrowers slow and more resources are directed to support weak entities.

    Japan Q3 GDP Likely To Be Revised Down After Capex Fall.

    Australia’s Four Largest Banks Downgraded by S&P on Criteria.

    Egypt’s Islamists Poised to Dominate Parliament. Islamists appear to have taken a strong majority of seats in the first round of Egypt’s first parliamentary vote since Hosni Mubarak’s ouster, a trend that if confirmed would give religious parties a popular mandate in the struggle to win control from the ruling military and ultimately reshape a key U.S. ally. Final results, expected Friday, will be the clearest indication in decades of Egyptians’ true political views and give the long-banned Muslim Brotherhood a major role in the country’s first freely elected parliament. An Islamist majority could also herald a greater role for conservative Islam in Egyptian social life and shifts in foreign policy, especially toward Israel and the Palestinians.

    EU Wimps Out on Oil Sanctions to Halt Iran’s Nuclear Drive: View. Who would have thought a week in which protesters rampaged through the U.K. Embassy in Tehran would end with Europe going soft on the Iranian regime? Yet that’s exactly what happened.

    Smart guy!  The S&P 500 should post modest gains next year, says Russell Investments’ Stephen Wood. Unfortunately, right now we are engaged in a violent tug-of-war between the stuff we can measure, like positive economic and corporate data in the U.S., and the irrational fear of the unknown, Europe especially, that make forecasting a very difficult task. In the end though, it’s the fundamentals, valuations and earnings that really matter, and the markets will stabilize. (video

    12 Great Insights From Today’s Big Bloomberg Hedge Fund Conference.

    Goldman’s(GS) Top Strategist Sets 1,250 S&P 500 Target For 2012.

    Warren Buffett seems to be ignoring his own advice in his purchase of the Omaha World-Herald. In 2009, he called the future of newspapers "terrible," and said he wouldn’t buy most of them "at any price." He may want to keep his hometown paper locally owned and preserve its editorial independence, but is that in the best interests of Berkshire (BRK.A) shareholders? - Looks like Warren has the same concerns I do of lack of newspaper independence.  Whoever wrote this news item doesn’t understand the value of good information.  

    In spite of Solyndra’s bankruptcy, and the political firestorm that resulted, VCs poured over $450M into 18 cleantech startups in November. $200M of that sum went to Better Place, which hopes to build a giant network of electric car battery-swapping stations. Other recipients include solar module firms Reel Solar and Solaria, and water filtration system maker Amplio.  - Hey, battery swapping stations was my idea! 

    Major railway companies, including CSX (CSX) and Union Pacific (UNP), appear to have a avoided a strike of almost 50,000 workers next week after reaching tentative labor deals with two big unions. A third union, the last of 13 with out an agreement, has extended the deadline for a deal by two months. (previous

    More on H&R Block (HRB): FQ2 misses EPS estimates as its loss widens – despite higher net revenue – on a jump in overhead costs. The company is at the tail end of a revamp to return its focus back on its traditional tax-preparation business, including divesting itself of its brokerage and sagging mortgage-lending operations. Shares -2.7% AH. - Yay, almost time to buy again!  

    The EU Commission is expected to issue early next year a statement of objections over 400 pages long that will detail the bevy of allegations against Google’s (GOOG) about the abuse of its dominance, the dealReporter writes. Google faces a fine of up to 10% of its annual turnover if found guilty. - Turnover = SALES for you Yanks!  

    Jobs Friday: What The Geeks Expect (Marketbeat)

    Here’s The SEC’s Statement On Why It Can Prosecute Members Of Congress, But Doesn’t.

  176. Don’t forget, now oil is heading back to $101 but we don’t short at $101 again unless we get a cross over and under.  OR, if we get rejected at $101, then we can short at $100.95 but these are momentum plays, we don’t play when it’s not going our way.  If we don’t get those targets, the next play comes at a cross below $100.50.  

    Dollar 78.32 – pretty flat to yesterday’s close.  

  177. oil – Phil, the run up of oil from lows of oct (£75) to current £100 plus highs was interesting in that the last leg of run up (from £90ish onwards) was against a rising dollar and a weak equity performance.  Does it mean that the NYMEX crooks knew of the FED plans and therefore even with the inventory build up and roll-over positions from Nov to Dec worked their way through the uncertainty and screwed the bears on the basis that equity markets would eventually catch up giving the £100 oil level at least temporary support?
    If that is the case then can the following be the scenario that unfolds?
    A – If there is further stimulus/ good data/ good news out of EU then equity market go up, but oil would under-perform as if oil increases the equity markets may not like it and kill the rally and therefore oil is managed lower?
    B- If there is no further stimulus then oil tanks much lower than equity markets
    So in essence oil may not go above the £103 level that we saw recently?

  178.  "…she would have made an excellent President."
    Unfortunately, this isn’t a sarcastic comment, I’m sure.  I can’t imagine a worse one, Cain, Perry,  George Dubya, Edwards, Obama, or Buchanan. 
    I don’t think I’ll EVER understand, nor do I ever want to, thetwisted, contorted  rationale behind the Hillary fans.  Her Hillary care plan I have lately come to adopt in desperation over the outrageous behavior of the Health Inurance/Mega-Hospital amalgamation and the outright rejection of Patient Care in facor of Executive enrichment at all costs, and CONgress’ inaction to change the status of non-profits to recognize this. But, POTUS?????  NEVER!
    She is as arrogant, inexperienced, and now possesses the obese image of a frump.  She is no better than any other candidate and far worse.
    What is it with you acolytes, disciples, and kneelers at the altar of Hillary? 
    Please, I am somewhat open to ANY half dozen criteria that makes her in your view "AN EXCELLENT POTUS"? ????

  179.  stjeanluc: "lucky"
    I liked your point earlier that even an "intellectual gift" can be attributed to luck. Many with above average intelligence think it is a trait they earned or were in some way more deserving to receive. 

  180. can someone do th emath for me and explain a 4 tenths drop in the unemployment rate?….