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Thursday Flip-Flop – Now GS Says S&P 1,250 is Target

chartOh sure, NOW they agree with me! 

That's right folks – Goldman Sach's Chief Forecaster, David Kostin latest monthly chartbook has a 3-month target for the S&P 500 at 1,275 (down 9%) and a 12-month target of 1,250.  

I don't agree with the longer-term forecast as I think inflation will kick in by then and we'll be off to the races (in price, not value) but that 90-day target is right on the money.  I know you may be saying to yourself: "Say, didn't Goldman just tell us last month to BUYBUYBUY?"

Of course they did.  If you don't BUYBUYBUY, who were they going to SELLSELLSELL to.  See those S&P calls at the bottom – Nove 30th: "SELL Internationa Sales Basket," January 9th: "SELL S&P 500" – that's what GS tells their insiders – if you somehow got a slightly different impression of what they were saying from the MSM or ex-GS alumni Jim Cramer or any of the 300 stooges on CNBC – you must have simply misunderstood.  

Doesn't Cramer sound like one of those hosts on the Home Shopping Network when they get stuck trying to sell an item that isn't moving?  Clearly the Banksters did not expect that their Pavlovian attempt to train retail investors to buy every dip would wear off so quickly and this is why we "Sold into the Excitement" last week, rather than waiting for the charts to tell us what the Fundamentals were whispering in February, when we made our plan to "Sell in March and Go Away".  In fact, the title of my Friday post was the last in my series of warnings: "March Goes Out Like a Lamb (to the Slaugher)." 

SPY 5 MINUTE After adding additional bearish bets in yesterday's morning post and early Member Chat (and TLT is flying this morning), we did flip bullish at 2:15, going long on the Russell Futures (/TF) at 815 and the QQQ weekly $66 calls at $1.16 (for the Futures-challenged).  The RUT gave us a lovely run back to 818.50 for a $350 per contract gain and the Qs ran up to $1.40 for a nice 20% gain in less than two hours and, of course, we flipped back to bearish at the close.  My prediction for tomorrow (today) was:

I think we're good for at least another half-point down tomorrow.  

So far, so good on that call as our futures are down just about half a point (7:30) but there's bound to be at least an attempt to run us up into the open so we'll just have to see how it plays out.  The Russell Futures (/TF) dropped all the way to 810 and that was a good bounce spot and it's still a good re-entry on the long side if they can crack that 815 line but I think we're going to see former supports turn into resistance today and that will not be a happy sign for the bulls.  

Our Big Chart levels are working very well and, when they fail, there's no support all the way down to those 50 dma lines so we have to watch the Russell very closely as failing to hold 820 is a failure of the 2.5% line AND the 50 dma.  That will be quickly followed by the NYSE failing 8,100 on it's way to 8,000 and then the Dow faces a critical test of 13,100 but, if the other two are breaking – it's a quick ride for the Dow down to 12,800 and then that pulls the SPY back to 1,366 and  the Nasdaq will test 3,000 in the most critical index move because, if the Nas fails (not likely without an AAPL sell-off), then the wheels will really start falling off the bus.  

So happy Thursday to you!  This is where that whole "Cashy and Cautious" thing we've been talking about starts to pay it's own very special dividends as we can just sit back and enjoy this little correction.  I listed some bullish trade ideas we're watching (again) in yesterday's post and, in Member Chat we did a couple of very well-hedged long positions but our hearts aren't in it yet – we want real bargains before our money comes off the sidelines.  

Anyway, it's Earning Season and that means plenty of opportunities for companies to shoot themselves in the foot so we can wait, PATIENTLY, for genuine opportunities to deploy our cash and meanwhile, we're enjoying the ride down while it lasts

8:30 Update:  Another 357,000 people lost their jobs last week and the prior week was revised up from 359,000 to 364,000 and that sounds awful but it's actually getting back to "normal" for a country with 160M people working.  Unfortunately, we're no longer a country with 160M working people, it's more like 135M and that's 15% less so if we add 15% back to 357,000 we get 410,000 so that's the apples to apples comparison on the long-term chart.  

See, the math really isn't very complicated but analysts never do it – they just compare current data points to prior data points as if they are all the same.  So, in reality, we are still up around that 400 level on the 4-week average for Job Losses Adjusted for Total Job Deflation in the land of far less opportunity than we had back in the 90s.  

Tomorrow we get Non-Farm Payrolls, which are expected to be up about 230,000 but US Markets will be closed and then, when we open Monday, the European Markets will be closed so it's going to be an interesting couple of days and TGFF (Thank God For Futures) as it should be a very interesting couple of days to trade.  

Canada added 82,300 jobs in February and that would be like the US adding 800,000.  32,000 of those jobs were in Government Health Care and Social Assistance so don't worry about the US matching that report and another 28,000 jobs were added in "Information, Culture and Recreation" with Culture being another one of the items the GOP wants to cut out from our society.  37,000 jobs were also added in Natural Resources, with oil and mining undergoing a boom in Canada on spiking commodity prices.  Manufacturing was the black cloud, edging down over the past 12 months.  

Manufacturing is also a disaster in the UK, where official figures published Thursday showed U.K. manufacturing output fell by 1%, the sharpest annual rate for more than two years in February, stoking fears of renewed recession.  Economorons had expected a 0.1% increase in Manufacturing Output so this is a 1,100% miss but STILL probably won't win the month's worst call by the people who's job it is to track these things.  

Thank goodness we don't believe in Socialism in this country – next thing you know, we might have to actually give people raises – like they are doing in Germany, in some crazy socialist attempt to boost their middle class, despite (or because) their Industrial Production also fell 1.3% in February (are you sensing a pattern here or is it just me?). 

Hopefully, the 6.3% increase in wages for Germany's largest labor union is a sign of inflation to come in the Global Economy because only bottom up inflation, that begins with wages and boosts GDP through good old-fashioned economic growth (without stimulus) which will shrink our debts by attrition – because austerity is clearly not working (just ask the people who are killing themselves in Europe).

Have a great weekend, 

- Phil


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  1. Good Morning every one Somebody knows when the market will close today?


  2. Oil Lines

    R3 – 106.20
    R2 – 104.95
    R1 – 103.57
    PP – 102.32
    S1 – 100.94
    S2 – 99.69
    S3 – 98.31

    PP has held all night and was a good shorting point!


  3. I believe we have normal market hours today Yodi. And all weeklies expire today!



  4. Hi Phil:  All my remaining holdings are buy-writes and most of the stocks are over the strike price.  Should I be looking to do something in particular in a dip like this or since they are on target just let them be?  If I understand correctly from the retirement protfolio, I really don't need to do anything if I like the stock and feel comfortable with the returns…


  5. CNBC propped up T Boone to tell us how Brent crude is going right to 148 because the Saudis just don't have that much oil left and supply right now is very tight.  Are you for real???  T Boone obviously does not read any inventory reports and neither do anyone at CNBC.  He actually seemed like he had dementia when they were speaking to him today.
     
    Richard Rainwater, considered the smartest and best private equity guy of all time, thought this much of T Boone Pickens when he took over Mesa Petroleum and eventually turned it around, his wife did the fat cutting:
     
    . In 1996, after Rainwater bought into deeply troubled Mesa Petroleum, she booted T. Boone Pickens from the company he'd built, telling him that he was "unfinanceable."


  6. stjeanluc  Thank you


  7. PP for today:


  8. I think pickens wants oil to be high so he can get support for converting trucks to nat gas because he has so muh money invested there


  9. Last week the Dallas Fed issued an explosive report (PDF) — predicting America will face another financial crisis and be forced to bail out Wall Street again unless the biggest banks are broken up.

    This isn't the Occupy movement. The Dallas Fed is one of the most conservative banks in the Federal Reserve system. And it knows first-hand about the dangers of under-regulated banks — the Savings and Loan crisis of the 1980s and '90s affected Texas like nowhere else.

    According to The Dallas Fed report, Wall Street's power makes it almost impossible to control because "they have the lawyers and the money to resist the pressures of federal regulation." This means the Dodd-Frank act, which is supposed to prevent another financial calamity, is woefully inadequate.

    Wall Street seems intent on proving the Dallas Fed correct. At this very moment its legion of lobbyists is pushing legislation in Congress to weaken provisions in the Dodd-Frank law regulating the trading of derivatives.

    Meanwhile, the same lobbyists are swarming over the regulatory agencies charged with implementing Dodd-Frank. They've been trying to weaken other provisions, like the so-called Volcker Rule that bars banks from gambling with commercial deposits. The Volcker Rule is now riddled with loopholes large enough for the bankers to drive their Ferraris through.

    Where they haven't yet eviscerated Dodd-Frank, Wall Street's lawyers have been going to court to stop it. Recently, they delayed a rule by the Commodity Futures Trading Commission to limit speculation in commodities such as oil.

    Clearly Wall Street hasn't learned its lesson. The public will not tolerate another financial meltdown and bailout, and yet Wall Street won't accept more regulation. If it's too big to fail and too powerful to regulate, the only answer is, according to the Dallas Fed "breaking up the nation's biggest banks into smaller units."

    We did it to the giant oil companies a century ago because they were too powerful, economically and politically. It's time to apply the same medicine to Wall Street.

    - R. Reich


  10. Good morning,

     

    IWM     79.10,  79.29,  79.56,  79.82,  80.17,  80.46,  81.04,  81.41,  81.64,  81.94,  82.10,  82.34,  82.66,  82.82,  83.18,  83.33,  83.55  and  83.74

    Good hunting !!


  11. Nice recovery as well with this portfolio! The FAS options expire today and look safe for now, but better be careful of Mr Stick later today!


  12. GS is secretly telling people the S&P 500 should be 1,250
    While also saying Priceline PCLN $1,000 probably! This is crazy, $755 this morning!


  13. Phil,
    Any Birkshire Discussion update?





  14. The DIA puts are now a double! I guess we protect that…. I am feeling Jabo's pain when I look at PCLN this morning. WTF – Up $7.00 in this environment.


  15. AAPL portfolio:  Now back to cash in the portfolio.   I  bought the April 600 puts back for  5.15  and I sold the 10 May 625 calls for  29.65, both trades for profit.  


  16. stjeanluc--pain is an understatement…I hate PCLN


  17. Good morning!  

    We're getting a little move up into the open but 81.175 looks like support for the Dollar (now 80.25) so I'm not even sure they can get us green before the Dollar bounces.  

    TLT topped out just under $114 and is back to $112.75 already and the VIX is just under $17 so conditions are good for the Bulls – let's see what sticks.  

    820 on the RUT is life and death but they're over 815 (/TF) and that's one of our bullish hedges and the QQQ's are at $67.30, about where we left off yesterday and if the Nas breaks over 3,075 (now 3,066) then those can be played for momentum as well but I'm certainly not seeing the kind of news flow that makes me think these moves are real.  

    At the open: Dow -0.4% to 13022. S&P -0.41% to 1393. Nasdaq -1.46% to 3068.

    Treasurys: 30-year +0.54%. 10-yr +0.32%. 5-yr +0.13%.

    Commodities: Crude +0.26% to $101.73. Gold +0.79% to $1626.85.

    Currencies: Euro -0.72% vs. dollar. Yen -0.29%. Pound +0.44%.

    Market preview: Stocks are poised to extend yesterday's losses as rising Spanish and Italian bond yields again weigh on sentiment and overshadow more positive U.S. jobs data (III), with S&P benchmark futures -0.3%. Polycom tanks 20.2% following a profit warning, although Bed Bath & Beyond is +4.7% after Q4 earnings.

    Initial Jobless Claims: 357K vs. 355K consensus (prior week revised to 363K from 359K). Continuing claims -16K to 3.33M.

    Mar. Challenger Job-Cut Report: 37,880 , down 27% from 51,728 prior. -9% Y/Y. Consumer products firms have announced 18,438 cuts YTD.

    The Fed's "pledge" to sit on rates through 2014's end is "an unwarranted pessimistic signal" to send, and could be hurting the economy, says St. Louis Fed President Bullard. "Forecasters can't really tell what will happen that far down the road."

    Has the Fed Boosted the Stock Market? (Northern Trust

    The pros and cons of the Fed’s three options (FT Alphaville)

    "We won't accept any exchange rate below 1.20," says a SNB spokesman, trotted out after the euro briefly fell below that level vs. the Swiss franc. "We are committed to buying foreign exchange in unlimited quantities to defend this level." The euro is currently buying CHF1.2025.  The euro briefly fell through the CHF1.20 floor placed underneath it by the SNB last September, declining to CHF1.19995 before bouncing back over it. "It's been our prediction for awhile that the floor won't hold, not when you have a renewed concern about the euro region," says a strategist.

    Zillow's forecast for 2012 home value changes shows a few cities in the green, led by Washington, D.C., a town whose leading industry never faces a slowdown. Also near the top of the list are some of the real estate busts hardest hit burghs – Phoenix, Riverside, and Miami/Ft. Lauderdale.

    At what point do people admit this is just a scam?  Investors pulled another $3.53B from U.S. equity funds in the week ended March 28, the sixth straight week of outflows during which investors have pulled ~$13B – even as stocks were flying, the economy was improving and Europe had moved away from the brink. The market’s recent turbulence likely means investors will keep pulling money from those funds in the coming weeks

    States shush corporate critics (Salon)

    Beware of Budget Gimmickry (Economix)

    Barton Biggs expects a 5-7% decline in the S&P, reports Betty Liu. Bloomberg's Hedge Brief charts Biggs' calls over the past few years and finds him mostly a good contrarian indicator, but also proving the adage about a stopped clock.

    How sweet would have it have been to buy that big Treasury sell-off when the FOMC minutes indicated no imminent QE? The long bond has moved in a straight line right back to where it was as no QE means stocks fall, which puts QE back on the table and the bid back in Treasurys. Remember the cycle. The 30-year off 5 bps to 3.31%.

    A majority of analysts polled by Bloomberg turn negative on gold, the first bearish read this year. Topping the list of concerns are slumping demand in India – where jewelers have been closed for 3 weeks in protest of higher taxes – and the Fed being a little less eager to paper the planet with greenbacks. Gold +0.8% to $1,627.

    Shares of L&L Energy (LLENshoot up 15.1% premarket after the company signs a major agreement to provide coal to a large state-owned utility in China through one of its subsidiaries. 

    When the going gets rough, the rich go shopping!  Nordstrom (JWN) same-store sales: +8.6% beats consensus of +5.8%. (PR)

    Macy's (M) same-store sales: +7.3% beats consensus of +4.8%. Shares +0.7% premarket. (PR)

    Target (TGT) same-store sales: +7.3% beats consensus of +5.4%. Shares +1.1% premarket. (PR

    Gap (GPS) same-store sales: +8% beats consensus of +5.4%. Shares +2.6% premarket. (PR)

    Buckle (BKE) same-store sales: +6.4% misses consensus of +8.8%. Shares -4.2% premarket. (PR)

    Saks (SKS) same-store sales: +6.3% in-line with expectations. (PR)

    TJX Companies (TJX) same-store sales: +10.0% beats consensus of +5.3%. Shares +2.1% premarket. (PR)

    Kohl's (KSS) same-store sales: +3.6% beats consensus of +2.1%. Shares -1.7% premarket. (PR)

    Fred's (FRED) same-store sales: flat. (PR)

    Bon-Ton Stores (BONT) same-store sales: -0.1%. (PR)

    Wet Seal (WTSLA) same-store sales: -7.8% misses consensus of -6.0%. (PR)

    Shares of wine maker Constellation Brands (STZ -6.8%) go sour following its Q4 report, in which it forecasts FY 2013 adjusted EPS of $1.93-$2.03, well below the $2.34 it earned in FY 2012, and the consensus of $2.23. Even a $1B buyback is not assuaging investors. 

    A sign of things to come? The Department of Veteran Affairs is terminating a massive 3-year licensing deal with Microsoft (MSFT) that covered 300K employees. Ending the deal could lead to $70M or more in annual savings for the VA, whose CIO suggests the decision was motivated by the impact of 

  18. Phil


    A sign of things to come? The Department of Veteran Affairs is terminating a massive 3-year licensing deal with Microsoft (MSFT) that covered 300K employees. Ending the deal could lead to $70M or more in annual savings for the VA, whose CIO suggests the decision was motivated by the impact of cloud services and mobile devices, and says the move will help "foster competition between vendors." (Forrester)

    A strong dollar will pressure global IT spending in 2012,predicts Gartner. The firm now expects spending to rise 2.5% in 2012 to $3.7T (prior forecast was for 3.7% growth). Enterprise software (+5%), telecom equipment (+6.9%), and computing hardware (+4.3%) are expected to be areas of strength, while telecom services (+1%, hurt by declining voice revenue) and IT services (+1.3%, hurt by cloud deployments) are expected to be weak links. (previously)

    Publishers Simon & Schuster (CBS), HarperCollins (NWS,NWSA), and Hachette are reportedly close to reaching a settlement over the price-fixing investigations launched by U.S. and E.U. authorities, one that's expected to result in retailers such as Amazon (AMZN) once more having the power to set e-book pricing. However, Apple (AAPL) and two publishers – Pearson (PSO) and Macmillan – don't appear close to settling. (also)

    These Are The Prices AT&T, Verizon and Sprint Charge For Cellphone Wiretaps (Forbes)

    Google Will Abandon Android (Cek Log)

    Apple proves two gadgets are better than one (Futurity

    Investors, prepare for tax headache on cost basis (Market Watch)

    How Investing Turns Nice People Into Psychopaths (The Atlantic)


  19. Sorry, forgot to remind everyone about the Major Trend Line at IWM 81.84 I spoke of yesterday !!


  20. From Phil's (10:10 am) post above:
     
    States shush corporate critics – Salon.com


  21. Great cartoon StJ, thanks!  

    Remains of the day (great movie)/Arivera – If you are comfortable with your margin of safety (I expect a 10% pullback from the top) and especially if you REALLY want to DD at your net put prices, then no need to do anything and, of course, a disaster hedge can cover you otherwise.  

    For example, a 10% drop in the Nas should push SQQQ up to $14 (now $11) and you can buy the SQQQ $13/17 bull call spread for .40.  So, if you are worried about a 20% drop costing you $10,000, then you can buy 25 of those spreads for $1,000 and they'll pay $10,000 if the Nas is down 20% in September.  

    Otherwise, you lose $1,000 which, hopefully is a lot less than what you gain on your buy/writes if the markets DON'T drop 20%.  And, of course, you can offset that $1,000 by selling almost any 4-letter stock that you REALLY want to buy for 20% off like BRCM ($37.12) Nov $27 puts at .98 – you just need to sell 10 of those to get your $1,000 and then you have your cover and the worst case is you get 1,000 shares of BRCM for 27% off.  

    TBoone/Rustle – Do you think when he dies that CNBC will stuff him and have Disney wire him up like one of the talking Presidents so he can keep saying "peak oil" and "tight supplies" while they take great pains to avoid ever, EVER discussing this chart?  

    815 was a reject on the RUT (as expected).  $102 giving oil trouble but slightly over it.  13,000 in the Dow futures is not crossing (13,060 on Dow) and the Nas Futures are having trouble at 2,747, which is about 3,075 on the Comp.  Dollar 80.275 so indexes doing well without Dollar weakness so far.  

    SBUX still going up as is DISCA and FOSL – Madness!  

    Dallas Fed/Pharm – Gee, funny CNBC doesn't mention this – or the WSJ for that matter.  

    Build a Berkshire Workshop/Itrade – Yes, this weekend we can catch up. 

    PCLN/Jabob – I thought we agreed yesterday you would go bullish and be happy?  ;)   




  22. phil—if i went long pcln it would drop to 300 in a month


  23. Phil/Goldman

     
    Unbelievable. 
     
    I feel sorry for all the Johnny come lately types that thought they were going to miss the boat because the Great Goldman was saying Buy Buy Buy.


  24. lflan – quick AAPL question.  Will there be a rally going into earnings?  That's usually the normal routine but this time its a bit different considering how high it is.  What's your take on this.  I wanna nibble some today just in case this thing takes off on Monday again like this week. 


  25. feels so good when you close out your short puts in the morning on a dip and actually look forward to a stick for a change.


  26. FAS Money – Wow, big gain.  Somebody made some clever adjustments (pat, pat).  The $106s are .46 now and I hate to cash them with FAS at $105.35 and only hours to go but if we double sell we can get double burned so it seems I am in doubt, which means I should sell half – so let's sell 3 next week $106 calls for $3 ($900) and put a stop on the today $106s at $1 ($600) and hope they don't trigger but, if they do, we can probably sell 3 more next week $107s for another $900 and that's not a bad trade-off.  

    IWM Money – Yawn

    $5KP – DMND is starting to look like a waste of space, we'll see what happens next week.  We're looking to pick up $500 on TLT if that holds up so why risk USO over the weekend?  It'd down to $1.35 now as USO tests $102.50 so let's call that a stop at $1.25 if oil pops over.  GLL I can wait with.  

    $25KP:

    DMND – Feh.  

    XRT – Today's retail numbers were not too bad but I want to see earnings before giving up as sales do not always mean profits.  

    BBY  - Wrong BB because BBBY is flying.  This was supposed to offset losses on XRT and is not doing it's job at all.  

    SCO – Looking good

    SQQQ – Getting that Nas test right now.  

    FAS – I like the mix.

    TLT – Should have taken that and ran earlier.  

    VXX – Still hope there

    GLL – May is fine

    DIA – That one we should take off the table ($2.20) 

    USO – Risky but I don't see why they would improve over the weekend.  

    PCLN – Good thing we took a small entry.  Too early to adjust. 

    DDM – Bullish play?  That was a good idea, will help us sleep better on the weekend but why didn't we kill DIA when we opened those?  Kind of silly….

    StJ was right and please, in future, let's not blow double just because I'm busy doing something else.  On straight puts or calls, if we're up 100%, then AT LEAST 1/2 comes off the table unless I specifically say not to.  We had a double on oil yesterday and now 50% – that's pathetic.  


  27. diamond — Are you a prepper?


  28. JR

     
    Where are you pulling that trend line from?


  29. Latest FAS Money Update:

    We have a $1.00 stop on this week's options (now $0.77).


  30. rainmanPrepper? No.


  31. Looks toppy here – multiple resistance at our expected levels so big deal if we move higher here:  Dow 13,072, S&P 1,399, Nas 3,072, NYSE 8,104 and RUT 820 – boy are we on the button with our new 5% lines!  

    820 on the RUT is right at JRW's 81.84 for IWM too.  

    Salon article/Diamond – Yes, a very important read - especially for those who support those who support our "Corporate Citizens":  

    In five states, for instance, so-called Ag Gag laws are now on the books. Iowa just passed legislation that “criminalizes investigative journalists and animal protection advocates who take entry-level jobs at factory farms in order to document the rampant food safety and animal welfare abuses within,” according to the Atlantic’s Cody Carlson.

    Over in the world of energy, it’s much the same thing. Last month in Pennsylvania, the oil and gas industry successfully lobbied state legislators to ban physicians from telling patients what toxic fracking chemicals they may have been exposed to. As Mother Jones’ Kate Sheppard reports, “While companies must disclose the identity and amount of any chemicals used in fracking fluids to any health professional that requests that information … the new bill requires those health professionals to sign a confidentiality agreement stating that they will not disclose that information to anyone else — not even the person they’re trying to treat.”

    With details of the financial industry’s document shredding and robo-signing scandals still leaking out, the Denver Post reports that Republicans in the Legislature there voted down a bill simply “requiring that lenders prove their right to foreclose on a home.” That means Colorado remains the only state to “allow for a foreclosure without the lender first proving” it has the legal right to repossess a person’s domicile. With the GOP so successfully defeating the reform proposal in the face of public outrage at bank fraud, look for the financial industry to try to get state governments to set the same “no doc foreclosure” precedent all over the country.

    As disparate as such examples may seem, they each prove that 21st-century capitalism and old-school Orwellian control are not polar opposites, as they are often portrayed. On the contrary, those two political forces now often coexist in a symbiotic relationship — one that uses state power to keep politically charged information hidden. The theory beneath the calculation is simple: Public ignorance equals corporate bliss.

    PCLN/Jabob – Well I'll chip in to pay you for that service! 

    Goldman/Exec – It's simply amazing what these guys get away with.  

    Ah, there goes 3,075 on the Nas so game on for the DIA calls (/YM) over 13,000 as well as the QQQ TODAY $67 calls at .58 (.01 premium) with a tight stop at .50 or if we fail 3,075.  


  32. exec/ Trend line

    Late Feb; worked really well 3/23 and again yesterday !!


  33. Bill Gross tweet
    “Greece was a zit, Portugal is a boil, Spain is a tumor. You can’t fix a debt crisis with more debt.”

    AAPL headed for 640 next week.


  34. ABX – is a buy if you want to BTFD.  As is CDE, SLW.  If you are really bold and/or want some spice: PAAS and KGC.


  35. Phil, how long can the FED sustain a 61% purchase rate for treasuries? What happens when they start pulling back?


  36. rpme / rate — QE3?


  37. rpme/FED – I think the answer to your questions is simply "ka-boom".


  38. Hi Phil Looking at XRT can not shake that sucker Rolled  56 caller to Apr which is now again close to be assigned Looking to roll the same two points up to Sep 58 for a slight credit of .17 cents and a premium of 2.25. what you think??


  39. Still having trouble at our resistance lines.  Europe closed up 0.3% CAC, flat DAX and FTSE up 0.3% on an early close and a massively BS pump into the close of 0.8%.   Not only that but Euro still down at $1.305 and Pound at low of day at $1.5813 so it looks like total BS to me and there's no macros to support it so I THINK we are up for no good reason at all at the moment.  

    Change/Rustle – Change is good.  

    ABX/Scott – I like them but I'd wait before going too crazy on the others.  

    How long/Rpme – They can do it forever, it's just a question of what the rest of the World does as far as Dollar valuation or appetite for the same.  Most likely, they'll go from 60% to 70% to 90% until it's a complete farce if they want to keep rates down.  

    XRT/Yodi – It's a good adjustment but I wouldn't want to give them the cash until after earnings.  They could be down 5% ($3) next week on poor reports.  


  40. I switched sides, the bear is my friend again.
     


  41. Phil:
    "TLT – Should have taken that and ran earlier.  "
    Your comments earlier:
    Are you losing faith that this trade isn't worth holding until expiration? I still like it in April, but certainly not after this month.


  42. dar she blows captain! grrrrrr


  43. Now wonder Spain bonds took a hit!

    http://www.guardian.co.uk/business/2012/apr/03/spain-debts-high-government-bonds

    Despite announcing its most austere budget for more than 30 years last week, Spain's government admitted on Tuesday that the debt-to-GDP ratio will jump to 79.8% in 2012 from 68.5% last year.

    As Kevin Drum points out - "Yep, that's a shocker. Spain's most austere budget in three decades has produced a terrible economy, which in turn is producing even bigger deficits. Who could have predicted it?"


  44. Could the tax cuts been the source of the crash?

    http://uneasymoney.com/2012/03/28/soak-the-rich/

     

    Our current overblown financial sector is largely built on people hunting, scrounging, doing whatever they possibly can, to obtain any scrap of useful information — useful, that is for anticipating a price movement that can be traded on. But the net value to society from all the resources expended on that feverish, obsessive, compulsive, all-consuming search for information is close to zero (not exactly zero, but close to zero), because the gains from obtaining slightly better information are mainly obtained at some other trader’s expense. There is a net gain to society from faster adjustment of prices to their equilibrium levels, and there is a gain from the increased market liquidity resulting from increased trading generated by the acquisition of new information. But those gains are second-order compared to gains that merely reflect someone else’s losses. That’s why there is clearly overinvestment — perhaps massive overinvestment — in the mad quest for information.

    So I am inclined to conjecture that over the last 30 years, reductions in top marginal tax rates may have provided a huge incentive to expand the financial services industry. The increasing importance of finance also seems to have been a significant factor in the increasing inequality in income distribution observed over the same period. But the net gain to society from an expanding financial sector has been minimal, resources devoted to finance being resources denied to activities that produce positive net returns to society. So if my conjecture is right — and I am not at all confident that it is, but if it is – then raising marginal tax rates could actually increase economic growth by inducing the financial sector and its evil twin the gaming sector — to release resources now being employed without generating any net social benefit.


  45.  spain -11.4% ytd, 10y bund spread highest since dec., cds up 8% in 5 days…dont look here..keep on moving..its just spain…buy! im sure all those derivatives that turned euro pols into knots over tiny greece wont be a problem for the region's 4th largest economy.




  46. http://ftalphaville.ft.com/blog/2012/04/05/951021/spanish-bonds-banks-bonds-banks/     
     
      i just looked at analyst estimates for aapl q1 2013…they are estimating 5% eps growth! by then tv, iphone 5 and who knows what else…that is funny…eps +116% in recent q1.


  47. And a great chart from Spring_heel Jack:

    He could just quote me "We either go Up or Down from here" !!


  48. I feel like just buy AAPL June 700 calls for $13 and kiss April and May goodbye.  Who's with me?


  49. 11:01 AM Stocks reverse early losses to turn positive, S&P 500+0.1%, Nasdaq +0.2%. With some markets down more than 1% earlier, Europe also starts to show some green, led by France +0.4%

    11:50 AM European shares close mixed, but well off the lows following 2 days of big losses. Stoxx 50 -0.4%, Germany -0.2%, France +0.1%, Italy -0.2%, Spain -0.1%, U.K. +0.4%. Euro -0.6% vs. the dollar, but the big story was the common currency's momentary breach of the SNB's CHF 1.20 floor.

    12:00 PM On the hour: Dow +0.01%. 10-yr +0.26%. Euro -0.59%vs. dollar. Crude +1.13% to $102.61. Gold +0.91% to $1628.75.

    It's another stomach-churning dive in natural gas prices as EIA data shows a larger than expected inventory build (42 bcf vs. 34 bcf). May futures -2% to $2.095. UNG -1.4%. A natural gas producer ETF, however, is in the green, FCG +0.4%.

    Freddie Mac reports that the average rate on a 30-year fixed mortgage fell one bp to 3.98% this week, while the 15-year variety slipped to 3.21%. Rates on ARMs also moved lower in accordance with Treasury yields.

    High-Yield Credit Fundamentals Starting to Crack.

    Why the Fed has taken QE3 off the agenda (FT.com)

    Americans brace for next foreclosure wave (Reuters)

    Americans ‘just not prepared’ to manage their own retirement funds (Washington Post)

    Inspect the Fees in Your 401(k) (WSJ)

    Europe's Banks Face Capital Hole Under New Rules. Europe's top banks would have had to raise 242 billion euros ($323 billion) or more to achieve minimum capital ratios if tougher rules that are coming in for the industry had been in force last year.

    Contrary to positive reports about the state of its government finances, "Ireland has made no measurable progress with regard to consolidating its budget," asserts Commerzbank. Despite revenues that rose 10%, the deficit through Q1 is higher than last year. "The planned deficit reduction by 1.5% of GDP has thus moved out of reach."

    Portugal May Need Bailing Out Within A Year, Warns Olli Rehn. Political leaders should be ready to provide a further bail-out for Portugal within the next year, Europe's economic and financial affairs commissioner Olli Rehn has warned.

    An Impossible 57% of Spain's Budget Is Devoted To Pensions, Unemployment Benefits and Interest.

    China’s Bloody Factories: A Problem Bigger than Foxconn (Pulitzer Center)

    Now this gets interesting: Anonymous hacks hundreds of Chinese government sites (ZDNet)

    "China's banks (aren't) really the villains here," writes Patrick Chovanec, responding to Premier Wen's comments about their monopoly power. "They are creatures of the State; they do what they are told and incentivized to do," – that is lend, without counting the cost, for projects that "carry the imprimatur (and implicit guarantee) of the Mother State." 

    Speaking of Mother (4th E) States:  The hacking revelations at News Corp. (NWS) keep on coming, with U.K. channel Sky News admitting that it twice authorized its reporters to break into emails for "the public interest." The disclosure could further dent News Corp.'s hopes of gaining full control of Sky News parent BSkyB (BSYBF.PK).

    Bankers Form SuperPac for ‘Surgical’ Strike at Industry’s Enemies (American Banker)

    JPMorgan illegally let Lehman Bros. count customers’ funds as its own (Washington Post)

    Copper Falls -2.3%Copper futures slumped as traders continued to cash out of metals on diminished expectations for Federal Reserve stimulus, while an uptick in Spain's borrowing costs renewed concerns about the health of Europe's financial system

    Gold Falls for Second Day. Gold fell to a 12-week low in New York as the dollar strengthened on signs the Federal Reserve may refrain from providing more stimulus measures. Silver retreated the most in five weeks. Silver futures for May delivery slumped 5.5 percent to $31.45 an ounce on the Comex. A close at that level would make it the biggest drop for a most-active contract since Feb. 29. Silver was the biggest decliner on the Standard & Poor’s GSCI Spot Index of 24 raw materials.

    Oil Declines After U.S. Stockpiles Surge the Most Since 2008. Oil tumbled after the Energy Department said U.S. stockpiles surged the most since 2008 as U.S. crude output climbed to the highest level in 12 years. Futures fell to a six-week low as inventories rose 9.01 million barrels to 362.4 million last week, the most since June. Production gained 2.9 percent to 6.05 million barrels a day. 

    Atlantic Storm Season to Be Below Average, Forecast SaysA cooler Atlantic Ocean will probably produce 10 named storms in the hurricane season that begins June 1, about half last year’s total, according to researchers at Colorado State University. Of those systems, four will probably become hurricanes with winds of at least 74 miles (119 kilometers) per hour and two may grow into major storms with winds of 111 mph or more, according to the forecast. 

    Sam nailed this one!  InterOil (IOC -10%) shares are slammed after Raymond James cuts its rating to Market Perform from Outperform, citing Papua New Guinea's six-month postponement of its general election. The move is a major setback, given IOC's prior insistence that the election would be a catalyst for getting LNG project approval from the government.

    ROFL!  Poor bears:  Shares of A123 Systems (AONE +29.3%) soar as AllianceBernstein discloses a 10.1% stake in the lithium ion battery maker via an amended 13G filing, up from a previously reported 6.4%. Shares had been cut in half after last month's battery recall and resulting analyst downgrades.

    Shares of Seagate Technology (STX -7.6%) and Western Digital (WDC -4.2%) sink following cautious comments at FBN Securities, which lowers its target price on STX to $35 from $40 and WDC to $50 from $55 due to lower near-term supply HDD TAM assumptions and more aggressive pricing assumptions.

    Polycom (PLCM -17.8%) is trading near its 52-week low following its Q1 warning, which it attributes to weak sales in North America and Asia-Pac, and which has triggered a downgrade to Market Perform from BMO. The warning is likely raising fears of additional share loss to Cisco (CSCO) in the videoconferencing hardware market; IDC believes Cisco's Q4 videoconferencing salesstrongly outpaced Polycom's.

    Bed Bath & Beyond (BBBY +8.4%) makes new all-time highs after beating FQ4 estimates on the back of strong same-store sales, and offering in-line guidance. Jefferies (Buy) sees the results as proof the retailer will thrive as home furnishings sales "migrate into the direct channel," and expects e-commerce initiatives to "reduce concern that the company is standing still." Wedbush (Buy) praises BBBY's financials, product line, and cross-selling opportunities. (transcript)



  50. Teva (
    TEVA +0.65%) yesterday sued Dutch firm Synthon in New York for infringing seven patents as it readies plans to sell a generic version of Teva's blockbuster multiple sclerosis drug Copaxone before the patents expire. Synthon argues that Teva's claims are invalid or unenforceable. 

    A federal appeals court resurrects Viacom's (VIAB) $1B lawsuit vs. YouTube (GOOG) over the alleged unauthorized uploading of Viacom content between 2005 and 2008, including from "The Daily Show" and "The Colbert Report." The court's action comes as YouTube agrees to offer online movie rentals from Viacom's Paramount.

    Though Nokia (NOK +1.4%) is recouping some of thelosses it saw after its Lumia 900 Windows Phone received mixed reviews, bearish commentary is easy to find. In spite of a low price, aggressive marketing efforts, and AT&T's interest in promoting an iPhone/Android alternative, Deutsche and Avian both think Lumia 900 sales will be in the mere hundreds of thousands in its first 3 months of availability.

    One reason Research In Motion (RIMM -0.2%) is likely to stick around: In Washington, D.C., where "time stands still,"BlackBerry remains the official smartphone. According to aWashington Post report, either confidence in RIM's e-mail security or slow bureaucracy contribute to the government requiring 500K federal workers to stick with their BlackBerrys. 

    When in doubt, pump AAPL!  Though details about Apple's (AAPLmuch-rumored TV plans remain sparse, Jefferies' Peter Misek continues to expect big things very soon (previously). Misek predicts the device will be a gaming center and home automator in addition to a TV set, and forecasts "commercial production in May/June with 2M to 5M builds likely" - others forecast a 2013 launch. Misek's bullish expectations for an Apple TV set lead him to increase his FY13 EPS estimate to $53.98 from $49.20.

    And this is why I never buy the first version:  Apple's (AAPL +1%) customer support division is investigating multiple issues that have been reported regarding the new iPad's Wi-Fi radio, which is supplied by Broadcom (BRCM-0.6%). The issues include connection drops, slow transfer speeds, and an inability to detect local Wi-Fi networks. In spite of the Wi-Fi complaints and overheating reports, overall customer satisfaction with the new iPad appears to be high


  51. Made my nickle for the day, wishing everyone and their families a great holiday!!


  52. JRW – what is the chart you showed at 1210 of? Nasdaq futures?


  53. Thanks for the advice!  The experience here at PSW has truly been invaluable.


  54. AAPL share price officially over GOOG's. 


  55. JR/Spring Chart

     
    I was looking at that chart this morning.  The market has been resilient holding the trend line.  I think Phil is right that they will keep the market propped up today.  If nothing happens over the long weekend we could get a bounce on Monday.  It seems that's been the program lately.


  56. Some information that I thought you all may enjoy from us at The Oxen Group:

     

    Today we released our Top Picks for Earnings Season in Q2 2012. Our top picks are:

    • Ashland (ASH)
    • ACE Ltd. (ACE)
    • ENSCO (ESV)
    • American Axle (AXL)
    • Brookfield Office Properties (BPO)

     

    We think that these companies provide the best opportunities during earnings season. These companies are discovered via data analysis about growth potential as well as current value. These companies are the best combinations of both. Other notable picks are Fifth Third Bank (FITB), Canadian Natural (CNQ), and Teva (TEVA).

     

    We have already done:

    • Sell $60 Puts for May18 in ASH
    • 70/67.50 Bull Put Spread for May18 in ACE

     

    You can view this report for free: http://www.theoxengroup.com/blog3/?p=11256


  57. JRW
    Would you please repost that long weekend hold? Looks like this might be a good one.


  58.  I understand we are short gold through GLL.  I've seen no mention of silver — or ZSL.  Logic might indicate it's even more vulnerable to a downturn.  Did I miss a post on gold vs. silver?


  59. Capt. NDX

    Yes


  60. YRCW getting killed – $5.17.  

    TLT/DC – I meant we should have taken profits with a stop when they failed $13 but, once they were below and we missed it, I looked it over and figure we'll take $13 back so no reason to sell at $12.50.  We may have a big crash day on Monday – we may not but I'd sure hate to miss it.  

    Net gains/StJ – Yes but note it's the top 1% that have the better information and their gains (as we've charted many times) are extracted from the bottom 99%, who are enticed into the casino to enrich those at the top.  So of course the tax rates favor the house side players and not the bottom 99% gamblers, who get whacked for taxes on most of their gains even though, logically, it's the same "double taxation" on their after tax investment money that the top 1% feel would be criminal if charged to them.  

    The net gain from a rising financial sector is not "minimal" – it's negative.  It's Trillions of Dollars tied up in banks and paid out in fees to people who contribute very little to overall productivity.  That starves real companies from building lasting assets.  The same goes for the commodity sector, that is also a function of the financial sector.  Speculation drives oil up from $50 to $100 but the same number of people pull it out of the ground and it's shipped in the same number of tankers – no jobs are created but millions of jobs are lost as the Global economy spends an additional $2.5Tn a year on the same exact energy.  At $50,000 a job – that's 50M lost jobs a year.  

    Spain/Angel – Tick, tick, tick….

    Oil $103!  

    AAPL/Angel – That really is a new paradigm.  I don't think they have a clue how to estimate them anymore. 

    Up or down/JRW – Yep, that's pretty much what I expect to happen next week.  

    JWN making new highs as is DLTR – really a tale of two economies.  

    AAPL/Lolo – Are you sure you wouldn't rather have PCLN $800s?  ;)

    Happy Holidays Kustomz!

    You're welcome Arivera. 

    Silver/ZZ – I only like shorting silver when it gets silly as it's very unpredictable.  If it's pacing gold, I prefer to concentrate on gold, which tends to obey it's lines fairly well and also tends to be more liquid for adjustments.  With silver, if they put up a few good days then AGQ goes nuts and then that's where I like to get short as that thing can drop like a rock once silver runs out of gas but they've just been drifting along for the last few months so no fun.  


  61. Shadow / Long weekend

    Rule: If a BIG move on the LAST day before a 3-day weekend, hold a position in the direction of the move for continuation over the weekend !!
     

  62. Another same thing with less volume. AAPL holds NAS, Oil holds DOW, and the rest in the middle excepting XLF near bottom and indicating down. FWIW


  63. JRW
    Thanks! This time I wrote it down, that is only way I remember a new name. So good as long as my cats don't hide  it, anything I pay attention to they pick it up, it must be a good thing. 


  64. I've  been daytrading AAPL today, but because of the rapidity of trades and the risk involved, I'm not making the trades a part of the AAPL portfolio.  lolobear…..yes, seems we are going to get a runup in the stock pre-earnings. 


  65. AONE – i hope AB applies some pressure to clean up AONE management's overhead.


  66. AAPL portfolio trade:  BTO   50  bull call spreads May  625/650  for 33.58/ 22.04  =  11.54


  67. BlueGold, which was a highly touted commodity-investment fund launched in 2008, says it will liquidate and return money to investors. This could cause a downdraft in commodities as other players try to front-run sales on their positions. BlueGold is/was said to hold about $2 billion but it’s likely leveraged. The last year has been a rocky ride at the fund. Stephen Jen, who was a superstar FX strategist at Morgan Stanley, left to join Bluegold in 2008, but he quit in October to start his own fund, SLJ Macro Partners.


  68. Shadow, I think PCLN is doing its part holding up the Nas as well…


  69. So another all time high for PCLN and Apple.  Amazing.


  70. jericon
    Thanks I don't watch those types maybe I should.


  71. StJ – the cost basis for the PCLN puts are $9.XX right?  Just wondering as it says seven when they were bought, but from the rolling, they are higher if I am correct.  Thx.


  72. Nice sell-off.  Dollar finally moving up.  Markets almost starting to make sense (except for CMG and PCLN).  

    1:00 PM On the hour: Dow -0.12%. 10-yr +0.32%. Euro -0.60% vs. dollar. Crude +1.51% to $103. Gold +0.93% to $1629.05.

    2:00 PM On the hour: Dow -0.35%. 10-yr +0.36%. Euro -0.63% vs. dollar. Crude +1.45% to $102.94. Gold +0.91% to $1628.75.

    The percentage of bulls in the AAII Sentiment Survey falls 4.3 points to 38.2%. It's the lowest level since late December and only the 2nd time in 4 months below the historical average of 39%, notesCharles Rotblut. Bearish sentiment rises 2.3 points to 27.8%, also below its historical average (30%).

    The BLS has revised higher its initial estimate of jobless claims in 56 of the past 57 weeks. While this doesn't change the improving trend in the data, writes Eric Morath, it does call into question the survey's methodology, not to mention those who would trade on the number. "Revisions," says a portfolio manager, "tend to be viewed as noise." (see also)

    Market action this week is a reminder of how dependent valuations are on central bank policy, writes Mohamed El-Erian. Repeated interventions have distorted price discovery, and even though the rewards are becoming less attractive, "when push comes to shove … we suspect that central banks may ultimately resort yet again to their printing presses."

    The IMF breaks from the rigid Troika orthodoxy about fiscal policy and says that chasing deficit targets "may not be the best policy" for Portugal if its recession, which is already pretty bad, "turns out deeper than projected." However, the fund stopped short of easing those targets.

    Boeing (BA -0.1%) announces Q1 deliveries climbed 32% Y/Y and 7.9% Q/Q to 137, including 99 for its next generation planes. The company is positioned in 2012 to end the 9-year streak of Airbus (EADSY.PK) outdelivering it.

    Chrysler (FIATY.PK) will install Sirius' (SIRI +2.4%) newsatellite radios in its vehicles, becoming the first car maker to do so. Sirius is working with other automakers also, although Chrysler will carry the radios – which can record content and carry more Spanish-language channels – exclusively for a year. 

    The dependence of U.S. movie studio owners such as DWA,DISLGFCMCSANWS, and TWX on international markets continues to grow. IHS estimates the top 100 grossing films in the U.S. received 58.4% of their box office sales overseas, up 110 bps Y/Y. This growing reliance on international receipts, intensified byweak U.S. DVD sales, is problematic for genres such as sports dramas and comedies, which aren't well-received overseas.

    J.P. Morgan’s cuts its price target on shares of First Solar (FSLR -3.3%) to $20 from $35 and withdraws its target for SunPower (SPWR -2.2%), writing that the global subsidies for solar power “show no signs of stabilization,” resulting in uncertain pricing for solar power modules. In the case of FSLR, -38% YTD, the call seems too little too late.

    Despite efforts to manage the controversy, concerns about so-called “pink slime” in the nation’s beef supply are influencing decisions about what people buy and eat. In a poll recently conducted by Harris Interactive, 22% of respondents said they’ve either decreased and/or stopped altogether their consumption of ground beef in restaurants, and 25% said they’ve either decreased and/or stopped altogether their purchases from grocery stores. 

    Mylan (MYL -2.1%sues the FDA seeking relief over the 180-day exclusivity granted by the agency to Teva Pharmaceuticals (TEVA +0.4%) over its generic Provigil. Attorneys repping the firm filed the suit at double-speed with the launch of the narcolepsy-fighting drug just crossing the wires less than a week ago.

    Qualcomm (QCOM +0.2%) welcomes two analyst thumbs up: Barclays says its checks indicate “healthy” demand for smartphones last quarter and increasing chipset share for QCOM; Bernstein cites several sources of potential upside, from the growth of4G LTE wireless to expansion of the tablet market to success of computers running WARM (Windows on ARM-based chips).

    Intel (INTCplans to spend hundreds of millions to promote its ultrabook initiative, a marketing effort the chip giant calls its largest since the release of its Centrino platform in 2003. While many initial ultrabooks will simply be thin-and-light laptops in the MacBook Air mold (and that raises questions of how well they'll compete against the Air), future Windows 8 models are expected to be notebook/tablet hybrids with built-in touchscreens.

    Jim Cramer gives some love to Microsoft (MSFT +1.1%), noting on last night's Mad Money that the stock is a buy in front of a product refresh and both Windows 8 and the next-generation Xbox are slated to debut over the next year. MSFT's cozy 2.54% yield also catches the eye. (video

    Facebook (FBdecides to list its shares on the Nasdaq as the exchange claims another tech darling away from the NYSE. The IPO is expected to go off as early as next month – slated to be the largest offering since Google in 2004. NDAQ +1.1%, moving higher off the news reported by the NYT.

    Apple (AAPL) has a 7.85-inch iPad prototype in its labs, says die-hard Apple fan and blogger John Gruber in a recent podcast. The device is said to feature the same resolution as the iPad 1 and 2, rather than a retina display similar to the one in the new iPad. Plenty of rumors (III) have already surfaced about a 7.85-inch iPad being introduced to challenge the Kindle Fire's (AMZNlow-end leadership.

    Three lunchtime reads:

    1) Where to short when you short this market

    2) Europe needs the bond vigilantes


  73. Wow, people have no money, with 1.5% growth in Ave. Hourly Earnings (where most of the gains in employment come from), and Gas/Oil is up how much?


  74. Douglas Kass: "I am wondering out loud here – but could Facebook's IPO pull some interest out of Apple? Just saying …"
     
    (Facebook picks Nasdaq for IPO.)


  75. PCLN / Pharm,  I have a basis of 7.38.  Opened 530s at 5.45. rolled to 560s for 1.95, for a 7.38 basis.  I probably don't have the "official" trade amounts, but I think it's more like 7 than 9.


  76. Wow, with FB, PCLN and AAPL, the Dow can go to 11500 while the Nasdaq will hit 7500.


  77. Thx


  78. Dow volume 54M coming into 2:30 – meaningless. 

    V and MA making new highs as well today.  

    On this trend, AXP is relatively undervalued at $58.   You can sell the 2014 $45 puts for $3.80 and buy the $45/55 bull call spread for $6.80 for net $3 on the the $10 spread that's 100% in the money to start with. 

    PCLN/Pharm – Are you talking about the buy list or $25KP?  Not the same trade as we only just initiated on $25KP.  


  79. I am good to go on PCLN…thx.


  80. That's a lot of bcs lflan, what is your thinking on this, ramp up to earnings?  thanks.


  81. than who is buying it???
     
    Priceline /quotes/zigman/90481/quotes/nls/pcln PCLN +1.15% and Salesforce.com /quotes/zigman/338061/quotes/nls/crm CRM +0.66% are two other technology stocks with more than 50% returns. John Hurley is the only top-performing hedge fund manager with positions in these two stocks.
    http://www.marketwatch.com/story/another-look-at-top-managers-top-picks-2012-04-05?siteid=yhoof2


  82. Phil – Happy Pesach to you and your family!


  83. you see german bunds?….  2/5y note yields hit RECORD lows today…think about that…their economy is supposedly humming and inflation percolating with big labor cost jump….yet their bonds are crazy strong…that is HUGE red flag…. also bodes well for US treasuries


  84. Not very exciting so far.  I can't believe no one wants to cash out ahead of the weekend uncertainty.  

    FAS Money – $106 calls down to .08, good thing we set a wide stop!   Now we stop at .25 but hopefully we don't need it.  

    PCLN/Jabob – Ah so there is one guy buying it…

    Thanks Diamond.  

    3:00 PM On the hour: Dow -0.19%. 10-yr +0.33%. Euro -0.61% vs. dollar. Crude +1.69% to $103.19. Gold +1.06% to $1631.25.

    IMF data on nations' fx holdings show a 11% Q/Q rise in "other currencies." Simon Derrick looks at the big move higher in the Australian dollar occurring at the same time as suggesting a move afoot by central banks to accumulate the commodity currency. "We need to think about (the aussie) in a slightly different light from here."

    In an HBS study (.pdf) of Harvard alums involved in company relocation decisions, 57% of respondents said their decision involved the possibility of moving operations out of the U.S., while only 9% said it involved moving operations into the U.S. Moreover, the study found solid majorities across all demographic groups expressing pessimism about future U.S. competitiveness.

    Don't tell TBoone!  ConocoPhillips (COP -1.1%suspends funding for the proposed $16.3B Mackenzie pipeline project to bring natural gas from northern Canada to U.S. markets, citing low prices for the fuel. Partners Imperial Oil (IMO -1.7%), Exxon Mobil (XOM) and Royal Dutch Shell (RDS.A) are reducing spending on the project to unspecified levels.

    Saudi Arabia has ramped up oil shipments to the United States by 25% in the first quarter of this year to its highest level since mid-2008, with over 8M barrels booked in just the past two days alone. Much of the increase is aimed at building up inventories at its joint-venture Motiva refinery in Texas, and may go far towards taking a bite out of runaway domestic gas prices.

    Eni (E -1.3%) says it has been formally asked by the SEC to hand over documents on its Libyan business as part of aninvestigation "related to an ongoing investigation without further clarifications nor specific alleged violations in connection to 'certain illicit payments to Libyan officials' possibly violating the U.S. Foreign Corruption Practice Act."

    Earnings season leadoff hitter Alcoa (AA -1.9%) looks set to strike out, according to analysts. The company is forecast to record its second consecutive quarterly loss on low aluminum prices when it reports next week with the only wildcard in the mix appearing to be the foreign currency translation to its bottom line. (Previous: RBC Capital on AA)

    Deutsche Bank defends Monsanto (MON -2.1%), saying itsQ2 results indicate a strong start to the U.S. planting season. With corn acreage tracking to the high end of the target range, the firm ups estimates, raises its price target to $90 from $85 and reiterates its Buy rating on the stock.

    The Drug Enforcement Administration conducts searches at six Walgreen (WAG -1.2%) pharmacies in Florida and a WAG distribution center, part of a crackdown on big chains with high sales of pain medications like oxycodone. The DEA's action is not a criminal probe, but any potential order barring the sale of controlled substances could impact WAG's business.

    Las Vegas Sands (LVS +2.6%) and Penn National Gaming (PENN +0.9%) are the most likely gaming stocks to beat Q1 expectations, Morgan Stanley predicts. LVS likely will outperform because of its Macau results, particularly its share gains in the VIP market, while Penn posted strong same-store gaming revenues for February, with sales rising 5% vs. 1% expected.

    Nvidia (NVDA +0.2%) is treading water even though Canaccord is launching coverage with a Buy and $20 PT. The firm likes Nvidia's exposure to the smartphone and tablet booms (courtesy of its Tegra app processor line); expects the arrival of ARM-based Windows 8 systems to give Tegra sales a lift; and sees the adoption of software-defined radio technology, a specialty of recent acquisition target Icera, strengthening Nvidia's mobile position.


  85.  

    Michael Greenberger, a former regulator at the Commodity Futures Trading Commission (CFTC) who oversaw the futures markets, told McClatchy that the increase is due to “excessive speculation” on the part of Wall Street:

    “It is similar to the gambling Wall Street did on whether or not people would pay their subprime (below-market rate) mortgages in the mortgage meltdown,” said Michael Greenberger, a law professor at the University of Maryland and a former federal regulator of financial markets. “Now they are betting on the upward direction of the price of oil” … “It is excessive speculation, which is a fancy word for saying that gamblers wearing Wall Street suits have taken these markets over,” he said.

    Back in February, oil prices cracked $100 per barrel despite the lowest demand since 1997.

    The Obama administration has said that it will crack down on excessive oil speculation, but it’s oil speculation task force has hardly done anything at all. The CFTC, meanwhile, has been slow to implement new rules designed to rein in speculators that were a part of the Dodd-Frank financial reform law. Democrats have been pushing the agency to begin that enforcement.


  86. I can't get a fill today to save my life!  Asking for anything near the Mid is like getting laughed at.  
    Selling ASH puts  - nope
    Buying AAPL BCS – nope
    Buying AXP BCS – nope
    Selling a small RUT credit spread – nope


  87. Burrben – I'll sell you my USO puts for $1.20!  I will put in the order now.


  88. Sorry, Jabo, I crossed to the dark side and bought some next week's PCLN 770/780 BCS this morning, so at least I've defined next Friday's pin for you – 769.99.


  89. T-Boone / pipeline suspension:  Is this the low water mark on gas, then?


  90. I finally relented and shorted PCLN at 730. Oops, I did it again….
     
    Im short Sep 770 calls, but I am selling weekly puts against it. Is this possibly the right way to play these silly stocks?
     


  91. USO/Phil – pick up any oil shorts for the weekend? or stay clear?


  92. Very good article on two approaches to housing crisis (all worth reading):  

     

    There are two schools of thought on fixing the housing market.  The first is the Tim Geithner school, which we’ll call the “hope and change” school.  Hope and changers, who occupy most elite positions in the administration, in banks, at the Fed, in the economics establishment in Congress, at housing nonprofits like the Center for Responsible Lending, in regulatory agencies, believe that the housing market will come back when the economy returns.  Foreclosure problems may be tragic, or overblown, or not, but ultimately are incidental to fundamentals, like matching housing supply to demand or increasing employment through boosts in aggregate demand.  Warren Buffett is probably the most famous member of this school.

    The second is the “law and order” or “handcuffs” school, which has (loosely) as members people like former FDIC chief Sheila Bair, former SIGTARP Neil Barofsky, iconoclastic investors such as Bill Frey, foreclosure fraud defense attorneys, Congressional actors like Maxine Waters, criminologists like Bill Black and various securitization experts and bloggers.  The handcuffs believes that law and order is not incidental to the breakdown of the housing market, but is central to it.

    Lynn Parramore: Capitalism’s Dirty Secret: Corporations Don’t Create Jobs, They Destroy Them

    Are The BRICs Broken? Goldman And Roubini Disagree On China

    Newt Gingrich's health care think tank files for bankruptcy

    How Well Can You Live On Minimum Wage?

    114 banks are on review-for-downgrade by Moody's across 16 countries

     

    Dimon: A mortgage is collateralized by a house. If the value of the house goes down, you aren't free to walk away

    American suburbs turning into ghost towns: How homeowners are ditching out of town areas to live in big cities

    Large_wxijpms

    PepsiCo has now also admitted to being a past funder of the climate-denial think tankHeartland Institute. In a statement to ThinkProgress Green, the $57-billion food and beverages giant indicated that its funding was for Heartland’s efforts against soda and junk food taxes, not for its promotion that climate change is a “myth.” 

    Actually, The Reagan Recovery Was All About Big Government Spending

    Romney, who has two Harvard degrees, blasts Obama for spending "too much time at Harvard."

     

    Rich people don’t have normal things to worry about, so they make up really weird shit to worry about.


  93. Phil – GE Fyi
    Just as a side note I was looking through my portfolio and noticed the GE Apr 19 puts/calls from the below rec.  No real question, just pointing out we might have to do something before Apr ex.
    IncomePort
    I don't see GE popping $20 very easily but let's cash these puts in and sell 15 April $19 puts and calls for .99 to raise $1,485 that will expire in April.  As we're willing to own GE long-term, either being forced to roll the puts or forced to buy stock to cover (with $2,195 already in our pocket) is not something we're worried about. 


  94. Nas up 1% today – Amazing.  

    Fills/Burr – There's no volume, I don't think there are any counterparties around to adjust the ask.  

    Gas/ZZ – No, unless they shut production down, they will fill the pipes to capacity this summer and they will have to pay commercial users to accept early deliveries to ease the pressure.  Will be very interesting, good time to go into an LNG storage business.  

    PCLN/Barf – Selling calls too dangerous.  Just gotta pay up for the puts (July+) and accept the losses and keep on rolling until we finally catch a break (hopefully before $1,000).  

    Oil/Scott – Could blast 1-2% either way on Monday (along with the rest of the market) so either we'll be happy with the positions we have or it will be a great opportunity to roll and/or DD if it goes against us.  No point in using cash to bet ahead of time. 

    73M on the Dow with a minute to go.

    Have a great weekend those of you who aren't going to be here tomorrow!  


  95. American suburbs turning into ghost towns  If there are tons of suburban houses about to collapse in price, abandoned by an energy-price related move by Americans into bigger cities, then automotive technologies and automotive natural gas & alternative fuel solutions should do well.


  96. Hollow Talk – that's all we get from the Fed. Much better to get it from the Choir of Young Believers.


  97. maybe spain will be ok for awhile longer…but i just want to say how incredibly silly the view that europe doesn't matter will look in a few months if it is starting to unravel now…have a great weekend!


  98. Im with you to the end Phil! FU PCLN, CMG, et al! THese fockers are the cockroaches of the stock market, they just won't f#cking DIE!!! Ok, guess Ill run back to my barracks…Manlove Thursday what what!? Ya'll just dont know what you're missing! lol. Gotta laugh at this zoo they call a country. Adios muchachos!


  99. Dow 13060, and the Euro just held and crossed 1.3060, completing the famous "Dow Cross" pattern which will take the Euro below 1.30 next week!


  100. and maybe….APPLE WILL START BUYING SPANISH SOV DEBT!!  YEAH!!!


  101. Already the Futures are selling off – what a joke!  Only 109M at the close – all down.  

    At the close: Dow -0.17% to 13053. S&P -0.13% to 1397. Nasdaq +0.38% to 3080.

    Treasurys: 30-year +0.52%. 10-yr +0.33%. 5-yr +0.11%.

    Commodities: Crude +1.64% to $103.13. Gold +1.1% to $1631.85.

    Currencies: Euro -0.59% vs. dollar. Yen -0.06%. Pound +0.42%.

    Market recap: Stocks meandered through a lackluster session little changed, as investors hesitated to move ahead of tomorrow's monthly jobs report and the long holiday weekend. For the week, all three major averages posted their worst decline this year, assurging yields on Spanish debt added to eurozone worries. Losers slightly outnumbered gainers on the NYSE. 

    Whuck – only until 9:15???  While most stock markets worldwide will be closed for Good Friday tomorrow, the monthly employment report will be released as usual at 8:30 ET. Investors will have a short window to react as trading of stock index futures contracts will be open until 9:15. The Treasury market will remain open until noon. (preview here)

    The CBOE opens an inquiry into some of its traders, examining years of potential rules violations in the handling of stock-options orders. The exchange is already undergoing a separate investigation by the SEC, and has seen the recent departure of 2 executives from its regulatory division.

    Morgan Stanley (MS) changes its compensation rules, making it easier to clawback or cancel bonuses for "circumstances ranging from substantial losses to ethical lapses and include failure to appropriately supervise or manage an employee." The new rules will apply to all top execs and may become the model for other large banks.

    Larry Page continues his PR efforts (previously) by posting along missive that defends the huge changes made to Google's (GOOG) search results and privacy policy by arguing it's done in the name of creating "a simpler, more intuitive experience" across multiple services/devices, and making search results more human. He also suggests Google's moves are the result of a "long-term focus" and a "disregard for the impossible." Critics (III) might not be moved.


  102. Just got your box Jrom – thanks so much!  Stay safe and enjoy the holiday.  

    - Phil


  103. zerox/suburbs to ghost towns
     
    I have been saying this for years. Almost the whole of Florida, one of the most recently developed of the 50 states, has been based on the idea of cheap gasoline and more than one car for every household.  Zoning laws dictate that stores and businesses are to be built as far as possible from where people actually live, thus reversing thousands of years of human history.
     
    Now that the US is falling back into third world status, people simply cannot afford this lifestyle any more where you cannot walk to the store for food and supplies. You already see in the smaller town in Florida that center on agriculture that there is a plethora of neighborhood Mexican groceries and small businesses serving the largely Hispanic local population where people would rather send money to families back home than spend it on automobiles, automobile insurance, gasoline, interest payments, repairs, etc. When they do go to large supermarkets like Walmart, it is often a case of a busload of workers stopping off for an hour once a week (after payday) to stock up on bulk items.
     
    When Obama came into office and said the US needed to reduce its dependency on foreigh oil, I though he was talking about completely eradicating the suburban lifestyle, and maybe that is happening by natural attrition rather than by any central planning.
     
    Of course it is all relative, and not every suburban subdivision will go to the dogs overnight, but there may be a lot more nibbling at the edges.


  104. Phil – hopefully you recieved 2 boxes? Had to send them separately b/c of the knife.


  105. JMM/Florida,
     
    just got back from two weeks in Coral Springs.  Not only are the stores located far from where people live, no kids walk to school, nobody walks to the stores as you said, but there effectively is no mass transit either.  The few bus routes that are around don't get you where you want to go easily. 
     
    I was thinking about Phil's question about how busy gas stations are at these prices — but people in Florida do not have a choice really.
    Walking to my grocery store now!!!
    Have a great weekend all.


  106. received! Ok, 130 AM cant spell and am going to go pass out! Could someone post the link toapply for the build a berkshire again please? Thx.


  107. Build a Berkshire workshop link is here.  

    Also, very important everyone fill out the database Craig designed – we're looking to quantify the skill sets of our Member base (see BBBW post comments to get an idea of the impressive list).  I would appreciate it if everyone took a few minutes to fill it out:

     

    Instructions for the application:

    Before you can use the application you must have a GMAIL account.  Just log into the application like you are logging into your gmail account.  Once logged in you should see a Welcome message with the email you are currently signed in under.  The application itself It consists of three panels, Personal Information, Sector Expertise, and Work History.  Any other instructions are inside the application.  If you have any questions post them here and I will happy to respond.

    the Application is at http://tpl-investments.appspot.com


  108. Just one so far Jrom – I figured there was something missing.  



  109. Time to get to buying list out soon?

    http://www.bespokeinvest.com/thinkbig/2012/4/5/percentage-of-stocks-above-50-days.html

     

    Maybe in the energy sector at least. Man, look at the carnage!



  110. Tell me again why we need to cut taxes…

    http://www.offthechartsblog.org/think-middle-income-americans-are-overtaxed-think-again/

    Federal Income Tax Burden at Historic Low

    The United States Is a Low Tax Country

    http://andrewsullivan.thedailybeast.com/2012/04/taxes-are-low.html

    And Romney is campaigning both to slash the deficit and to cut taxes on the wealthy, while ramping up defense to levels beyond even the Cold War. It's as if he wants to repeat Reagan – when Reagan came to office at peak taxation and we are now close to the trough. This is what happens when ideology simply doesn't shift to adapt to reality, and when one party refuses to tell people that they cannot have their cake and eat it too. 


  111. Goodbye euro by 2020?

    http://www.project-syndicate.org/commentary/a-centerless-euro-cannot-hold

    The good news is that economic research does have a few things to say about whether Europe should have a single currency. The bad news is that it has become increasingly clear that, at least for large countries, currency areas will be highly unstable unless they follow national borders. At a minimum, currency unions require a confederation with far more centralized power over taxation and other policies than European leaders envision for the eurozone. [...]

    Europe may never be an “optimum” currency area by any standard. But, without further profound political and economic integration – which may not end up including all current eurozone members – the euro may not make it even to the end of this decade.


  112. Phil/TPL,
    What is the minimum contributions that you are looking at?
    Thanks.



  113. Canuck
     
    No, in Florida walking to the store is behavior that might get you shot by vigilantes and as you say there is no public transportation.


  114. Oil comment, FT Thursday April 05 2012:  "…The International Energy Agency, the western countries’ oil watchdog, estimates that crude demand will drop between April and June to 88.7m barrels a day, down 600,000 b/d from the first quarter of the year. The critical question is, therefore, whether the current slackening market is responding to deeper, non-seasonal factors."
     
    And continuing: "Oil traders do agree about something: The market could get a lot tighter in three months.  The seasonal lull in demand could end more or less at the time the full impact of the sanctions against Iran is felt. If Tehran exports drop as much as 750,000 b/d, as many traders are expecting, the current calm period will be short-lived."


  115. Oil comment II:  Leaving Iran aside, "FT April 4, 2012 11:19 pm  "Influential weather forecasters from Colorado State University have predicted below average activity for this summer’s hurricanes in the Atlantic, a potentially bearish development for West Texas Intermediate and Brent oil, natural gas and orange juice futures."


  116. Phil
    any way to play this trade you gave us in a different manner (wihout selling puts, possibly using another spread) in an IRA account without margin to get the same net result (i.e. net $3 on the $10 spread that's 100% in the money to start with). THANKS FOR ALL YOU DO.
    "On this trend, AXP is relatively undervalued at $58.   You can sell the 2014 $45 puts for $3.80 and buy the $45/55 bull call spread for $6.80 for net $3 on the the $10 spread that's 100% in the money to start with


  117. Good morning! 

    Futures up slightly despite Asia down 1%, except Shanghai, who are up a tiny bit but all of it a jam into the close.  There's only one story this morning:  

    Egan-Jones cuts its credit rating on U.S. government debt to AA from AA+ with a negative watch, citing a lack of progress in cutting the mounting federal debt. "When debt-to-GDP exceeds 100%, a country's financial flexibility becomes increasingly strained," Sean Egan writes. "For the first time since World War II, U.S. debt exceeds 100%." 

    Nothing that isn't obvious but it's the proverbial little boy finally pointing his finger and saying: "But the Emperor has no clothes!"

    Europe is closed and we're closed, of course.  We do get NFP at 8:30 and Consumer Credit at 3, but the Futures will be closed by then (9:15 as I hear it).  

    We're looking for 225-250,000 jobs added but what does that do?  It's too much for the Fed to ease and not enough to get us out of trouble this decade as we need 150,000 jobs a month to keep up with population growth and 100,000 above that puts us about 10 years from full employment.  

    Regardless, we had that great graph showing how we're adding the wrong kind of jobs and this graph shows the problem in a nutshell:  

    How can we have a recovery when the US Consumers, the ones the ENTIRE WORLD are now counting on to bring the planet out of recession, aren't even making enough money to keep up with the Fed's BS inflation numbers – let alone the real inflation of over 4%.  Where will the money come from for more houses, more cars, more appliances, IPhones, IPads, etc?  This is not a magic trick – at some point the consumer has to actually have money to spend!

    And that brings us to Consumer Credit and, surprise, surprise – look what the Consumers are forced to do as wages don't keep up with inflation:  

    Revolving credit (Credit Cards) was actually down $2.9Bn in Jan because PEOPLE HAVE RUN OUT OF MONEY!  What was up $20.7Bn was non-revolving credit and that's home loans but mostly auto loans, as the car companies have been boosting sales by giving loans to anyone with a pulse – what can possibly go wrong with that plan?  

    That was the largest increase in non-revolving credit since November 2001, just after 9/11, when they dumped rates and goosed liquidity, which gave us a short-term boost until the markets dropped 33% between March 2002 and July.  

    Next week we get the BBook, PPI and CPI but the focus will be on earnings and AA is not likely to get us off to a good start so I simply don't see anything in particular to be bullish about at the moment. 

     

    Tuesday Apr 10

     

    Redbook
    [Bullet
    8:55 AM ET

    Wholesale Trade
    [Bullet
    10:00 AM ET

    Beige Book
    [djStar]
    2:00 PM ET

    Treasury Budget
    [djStar]
    2:00 PM ET
    Weekly Bill Settlement

    Jobless Claims
    [Star]
    8:30 AM ET

    Money Supply
    [Bullet
    4:30 PM ET


  118. Energy Sector/StJ – If they can't get excited about $105 oil, what's going to happen to them if it drops back to $85?

    Taxes/StJ – And there's our entire debt.  10% less than the average is $1.6Tn a year of missing revenues.  Do that for 10 years and you have a 100% debt to GDP ratio.  The GOP solution is to go for 200% – that's where Japan is now so a couple of decades of stagnation lie down that path as our population ages and hope dies – great plan…

    TPL Survey/Pat – Not set, just a survey of interest and abilities.  No problem on the other – you just have to catch me when I'm in the mood to pontificate.  

    Watching Bloomberg "Game Changers" profile on Magic Johnson – very inspirational guy.  Wrangled the first partnership deal with SBUX and has 150 stores now.  Also, good example of a guy who came from the ghetto, was elevated through sports but the fact is this guy is a phenomenal business man – exactly what we were talking about this week – you don't know what people are capable of until you give them a chance – how many thousands of guys who could also build businesses and create thousands of jobs are relegated to flipping burgers or in gangs because they simply didn't get the one lucky break that BBall gave Magic? 

    Oil/ZZ – Boy is it going to hit the fan if Iran gets resolved.  That's the entirety of the bull case now.  

    AXP/Crussell – Well the bull call spread itself makes 47% if AXP holds $55 – that's not bad in a low-risk, IRA-type account but don't focus on the percentage, focus on the $3.20 you can make and the $6.80 you are committing.  On the short puts, you lower the basis by $3.80 and, of course, turn the potential profit to $7 and lower your break-even to $48, which is the main reason we like to do that.  

    However, in a non-PM account, the margin requirement is $7 more so you could simply buy 2x the bull call spreads ($13.60) and now your upside, at $55 is $6.40 and your break-even is $51.80 – not as good but certainly not terrible.  If you want to drop your break-even, you could just pick up the $40/50 bull call spread at $7.40 and now your break-even is $47.40 – the same as it is for a margin player and your upside is just $2.60 but that's still 35% and 2 of those spreads is $14.80 with a $5.20 potential upside and you have about the same cash and margin tied up with the same break-even as a margin player but you make about $1.80 less (25%).  

    This  is why IRAs are BS because the tax savings you gain aren't worth the flexibility you give up – especially when you consider the fact that trades like this are long-term gains anyway so you're only saving 15% tax on the profits but, because you have a stupid account with ridiculous trading restrictions and no margin – so you are much less likely to HAVE PROFITS to be taxed on when you trade through an IRA than you would with a conservatively managed margin account. 


  119. SPY 5 MINUTEFriday's economic calendar:

    Markets closed. 

    Monster Employment Index

    8:30 Nonfarm Payrolls

    3:00 PM Consumer Credit

    March Monster Employment Index: 143, unchanged from February but up 5% Y/Y. All metro markets tracked by the index continue to show positive annual growth.

    Jobs News Could Be So Good That It’s Bad (WSJ)

    Crestmont: Stocks ‘Fairly’ Valued, But ‘No Doubt’ Secular Bear Market Intact (WSJ)

    Bears not rampant (Market Watch)

    IRS Commissioner Doug Shulman warns of "a real disaster" for taxpayers next year if Congress misses a Dec. 31 voting deadline to renew the Bush tax cuts and other major tax provisions. Allowing things to remain unsettled as 2013 begins would cause "total confusion," especially for the alternative-minimum tax patch, Shulman says.

    XLF WEEKLYIs There a Fiscal Crisis in the United States? (Economix)

    Next Great Depression? MIT researchers predict ‘global economic collapse’ by 2030 (Yahoo News)

    The $25B foreclosure settlement between the government and 5 big banks (WFCCBACJPM and Ally Financial) gets an official seal of approval; U.S. District Judge Rosemary Collyer signed off on the deal on Wednesday, and her ruling was made public yesterday.

    Seattle Signals Glut Risk as Apartment Construction Rises (Bloomberg)

    The JOBS Act, signed by President Obama today, was built on a model that winds up more focused on pleasing Wall Street than helping small companies, says Herb Greenberg. Its intent was to make it less costly for “emerging” companies to get up and going and eventually go public. What it actually does is loosen up the rules designed to protect the investor and undermine Sarbanes-Oxley.

    You can't con a con, and a man convicted of cooking the books at the infamous ZZZZ Best in the 1980s says he’s baffled that Pres. Obama is signing the JOBS Act, which he fears will make stock fraud easier. For all the law's flawscrowdfunding is the worst: Right now, he says, fraudsters are “setting up dummy companies” to appeal to small investors "intimidated by bigger marketplaces."

    HYG WEEKLY

     

    Why Republicans and Democrats Can’t Feel Each Other’s Pain (Time)

    A Quantum Theory of Mitt Romney (NYT

     

    Rachel Domm

    Fig. 1: The famous “Schrödinger’s candidate” scenario. For as long as Mitt Romney remains in this box, he is both a moderate and a conservative.

     

    Rachel Domm

    Fig. 2: A Feynman diagram of an encounter between a Romney and an anti-Romney. The resulting collision annihilates both, leaving behind a single electron and a $20 bill

    DBC WEEKLYGasoline prices continue to march higher, and theconventional wisdom is they'll keep moving up, but more experts are now saying pump prices are close to peaking and probably won’t average much above $4/gallon this spring. Inventories of crude oil and gasoline are higher than a year ago, refineries are returning from maintenance, and operating rates and gasoline production are rising.

    Exxon (XOMreaffirmed its commitment to its oil deal with Iraq's northern Kurdish region, according to the website of the Kurdish president, pushing forward with a deal that caused a political uproar in Iraq when it was announced. 

    AT&T (T) is trialing a free Wi-Fi service at DFW International Airport that requires users to watch a 30-second ad in exchange for 40 minutes of web surfing. Given airports often charge $5-$10/hour for web access, many travelers will probably take the deal. Should AT&T's trial expand and/or other service providers follow suit, it could be a problem for Boingo (WIFI), whose business model involves selling subscriptions for its Wi-Fi hotspot network. (also)

    Intel's (INTC) low-power Atom CPUs will be designed into "infotainment" systems in new Nissan vehicles starting in 2013. Intel, which has been dinged by the massive decline seen in sales of Atom-based netbooks, is working hard to score Atom design wins formobile phonesTVs, and other embedded devices. 

    MSFT WEEKLYIBM and Red Hat (RHT) are giving their official support to the OpenStack cloud infrastructure platform, which backers hope will emerge as an open-source alternative to Amazon (AMZN) and Microsoft's (MSFT) proprietary solutions. Cloud hosting firm Rackspace (RAXstands to gain from OpenStack's adoption. Other key supporters include Dell, H-P, Cisco, and AT&T. Cloud infrastructure software vendor Citrix Systems (CTXSjust backed out.

    E-commerce startups looking to challenge Amazon (AMZN) are hoping Facebook (FB) and its social sharing features can provide them with the same kind of lift that has been given to many content providers. Already, clothing deals site Fab.com says it has 3M users who broadcast their purchases to Facebook friends. Commissions generated from e-commerce activity could represent a needed new revenue stream for Facebook.

    How Facebook Finds The Best Design Talent, And Keeps Them Happy (Fast Co.Design)

    Inside Amazon’s Idea Machine: How Bezos Decodes The Customer (Forbes)

    Dan Loeb can exhale. Yahoo's (YHOO) Scott Thompson will "outline his long-term strategy and vision" for the company at an all-hands staff meeting on Tuesday, a source tells Reuters. The fact Yahoo provided few details about its restructuring plans to go with yesterday's layoff announcement didn't sit well with Loeb and others. Since this is Yahoo, plenty of rumors (III) exist about what those plans might be.

    Google's (GOOG) e-book efforts don't appear to be going too well. The company, which has tied e-book sales into Google Play, says it's discontinuing a program that allowed independent bookstores to sell Google e-books through their sites, apparently due to a lack of interest. The lack of a popular e-reader that supports Google's own e-book store could have something to do with that.

    Research In Motion (RIMM) announces the departure of two senior executives as the company considers its strategic options. Alan Brenner, senior VP of the BlackBerry platform, will depart after a transition period, and Alistair Mitchell, a VP for BlackBerry Messenger, has already left.

    Samsung (SSNLF.PK) estimates its operating profit nearly doubled to a record 5.8T won ($5.15B) in the recent quarter from a year ago thanks to sales of its Gala


  120. Samsung (SSNLF.PK) estimates its operating profit nearly doubled to a record 5.8T won ($5.15B) in the recent quarter from a year ago thanks to sales of its Galaxy smartphones and its Note mini-tablet and phone. Analysts had expected 5T won. Results are due April 27.

    iPhone Outselling All Other Smartphones Combined at Sprint and AT&T (All Things D)

    Best Buy Is Selling Nearly as Many iPhones as Apple Itself (All Things D)

    VIX


  121. I was at a table of 14 people last night, two were laid off this week, one was laid off last month, and one is closing up his business because he is loosing money on it.  I know this is only anecdotal and not a representative sampling, but it certainly shakes faith that things are getting stronger. (I live in the Raleigh Durham area.)


  122. mb22 – I used to live in Cary until two years ago! I miss that place, it's the perfect blend of small-big city (even if it is a big spread out).


  123. Econophysicists say Zynga is overvalued and has been since its IPO. At best, the company shouldn't be worth more than about 5 billion according to their models.