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Frustrating Thursday – From .EUphoria to .DEspair

SPY 5 MINUTE.DE is Germany's web domain.

So I'm trademarking .DEspair to consolidate all the anti-EU statements coming out of Germany this week as the rhetoric reaches a crescendo and goes up from there.  .EU is, of course the EU domain and .EUphoria is where we will store all the glowing pro-EU rhetoric that makes the market rise (until someone in Germany says something).  

It's a typical case of .DE said, SH.Eu said and all the kiddies can do is hide in their room until Mommy and Daddy stop fighting.   

Things were getting silly enough on the plus side as we rallied for no reason at all that we added a very aggressive short position on the Russell using TZA.  My 3:07 comment in Member Chat was:  

Big RUT move makes TZA fairly cheap at $20 and the July $20/24 bull call spread is $1, which makes for a nice hedge and if the RUT pops, you can offset it with the July $18 puts, now .45, for $1 or better or, of course, there's always the TWIL List

We had no long plays to make yesterday as we added them all when the market was much lower (told you so!) and now it has moved to the top of the bottom of our range and we pick up a short – this is not rocket science, folks.  It's going to be a choppy, terrible market until either the EU saves us by tomorrow or we crash and burn horribly and my comment to Members in the Morning Alert at 10:24 was: 

We still need the Dollar to go lower and this morning it's zooming higher (82.80) and keeping us from a better move up on the indexes.  This will go on for the next few days with each syllable uttered by anyone of presumed authority in the EU so – if you can't stand the heat – stay in cash!  

FXE WEEKLYThe Dollar had worked it's way down to 82.50 into the close but now (8am) it's been jammed back to 82.90 as the Euro plunges back to $1.2426 on whatever silly thing someone just said.  Financials are dragging everyone down as they are DOOMED if the EU can't pull things together.

Financials are also hurting as the NY Times Dealbook Blog is reporting that JPM's Trading losses "may reach $9Bn."  I'm a little skeptical of this as it didn't pass fact-checking muster to make the main paper (and it would be a huge story if it did) and the woman who wrote it came from the WSJ, which also often fails to pass fact-checking muster – that is, if they did actually check any facts. 

This new allegation against JPM comes from "people who have been briefed on the situation" so you know it's good stuff, right?  Let's forget that Jamie Dimon JUST testified to Congress that the losses were $2Bn and that just last week, the positions were supposed to be unwound and under control.  

As the article says "In April, the bank generated an internal report that showed that the losses, assuming worst-case conditions, could reach $8 billion to $9 billion, according to a person who reviewed the report."  A person who reviewed the report?  I love that guy!  That guy makes us a fortune when he panics the sheeple out of positions ahead of big moves up.    

XLF WEEKLYThat's jamming our Futures (8:24) all the way back to where they were yesterday morning, down about 0.6% and led down, as we expected, by the Russell. which is already down 0.8% but we're not buying it (or selling it in this case), as oil is still at $80.50 – so we're not talking about economic retreat here – merely rumors ahead of the facts and shame on the NY Times if this turns out to be nonsense – we'll find out for sure on July 13th, when JPM puts out earnings but maybe sooner now as JPM is already down 3% pre-market and maybe will hit the 5% line around $34.75 and maybe we'll take a long flyer on them around there – or just go with the XLF longs if they re-test $14.  

BCS is down 8.6% as British Politicians are talking jail time for those found guilty of manipulating LIBOR (you know who you are!) and BAC is down 1.5%, MS down 1.2%, C down 1%, WFC down 1%…  U.K. Chancellor Osborne tells Parliament that RBS and HSBC (HBC), as well as foreign banks (apparently UBS and C) are also under investigation in regards to Libor.   Court documents in an unrelated case say hedge fund Brevan Howard asked RBS to alter Libor and the bank "received this request without objection."

As part of our review into Libor and the strength of the financial regulatory architecture, we will examine if there are any gaps in the criminal regime inherited by this government and we will take the necessary steps to address that. 

The FSA report is a shocking indictment of the culture at banks like Barclays in the run up to the financial crisis. The email exchanges between derivative traders and the Libor submitters working read like an epitaph to an age of irresponsibility.

Through 2005, 2006, and early 2007, we see evidence of systematic greed at the expense of financial integrity and stability. They knew what they were doing wrong… – Osborne

To top it all off – it's Health Care Day as the Supremes decide whether or not 54M uninsured Americans should be treated like human beings are in other countries or if they are just poor and therefore should burn in Hell, but not before suffering all the ills of the flesh that shall be vested upon them in the land of nothing is free and there is no hope – unless you have the money to buy it, of course.  

Mitt Romney said that even if the Supreme Court does uphold a law that passed through years of debates in Congress and was approved by both houses and the President – that his first goal in office, "on day one" will be to strike it down anyway - so this thing ain't gonna be over until it's over.  

Nouriel Roubini compares this moment to where we were in 1931 – right before the whole Global Economy went into free-fall, calling this a "perfect storm."  If so, our little TZA spread will make a nice 300% so it's hard to know who to root for.  We're still mainly in cash and our bullish plays are more of an upside hedge against the possibility that stocks become more valuable than our cash but, as I said to Members yesterday – it's going to be a very stressful couple of days and there's no reason to play if you don't thrive on the chaos.  

Speaking of chaos – we're still wondering if Obama's 4th Watergate will finally be the one that brings down the administration – check out the latest on the "Fast and Furious" scandal – it's a great distraction while they cancel your health insurance…

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  1. Good Morning!

  2. Oil Lines

    R3 – 83.67
    R2 – 82.29
    R1 – 81.43
    PP – 80.05
    S1 – 79.19
    S2 – 77.81
    S3 – 76.95

  3. Going to be a very interesting couple of hours/days. Hurricane force turbulence can be paradise for trading.

  4. Roubini interview on Bloomberg….pretty good one.

  5. Quote of the day:
    Gov. Rick Perry   "I don't know"….
    Phil, that was damn funny!  :)

  6. JPM – string him up….$2B, 3B, 5B, 7B now 9B….there is more there, as they peel back the layers.  The question is, how is MS and CS doing, as they are in much deeper do-do.

  7. Phi / Andy / wish I could sing: Great video of your bro!  Yeah, singers just start singing, no inspiration needed.  There's an old saying that talent does whatever it wants to, genius does only what it can.

  8. savi – Morning – what email address do I send the vegas payment to . ?

  9. Music/Phil – Damn, your brother's really good! I love discovering people who are fine performers that I've never heard of, except it always leaves me ticked off that they often remain largely unknown while a few, sometimes vastly inferior, performers get all the fame. It's a funny industry.

  10. zero – Great quote to pass on to my kids…. :)

  11. Phil / Any idea on how the verdict of the SCOTUS is going to impact stocks today?

  12. Phil/Romney
    Looks like he will have a busy first day at the oval office, striking down health care and attacking Iran on the same day so that no one will notice.

  13. SNTA and ANTH….not so nice on positive Ph2 results.  Looks like air is starting to come out of these little players after all. 

  14. Phil:
    Your brother has a fantastic voice. Does he still sing, or is it just a private hobby? For a minute I thought I was on the Love Boat! :)

  15. Earnings season preview: Q1 Corporate Profits: -$6.4B vs. +16.8B in Q4.

  16. Romney:
    He says many things.

  17. Whats causing /CL to drop from 80.8 to79.7  with no change in dollar/euro?

  18. mrm SDS crazy play…up to 8c!   Now, take me back over $17 and make my day…..

  19. /RB getting crushed as well

  20. I scratch my head about inflation.  There's no doubt that the world needs a pile of it, to make all the unpayable debt go away -The Great Debt Reset.  The populations of Europe and the U.S aren't much interested in taking on more of it, nor the banks much interested in giving it to them unless they have such good credit that they don't actually need it.  Nor does Germany interested in giving away free Euros to Peripheral country citizens. So how will this happen?

  21. Good morning!  

    WTF with the Nasdaq?  That toasted our $63 calls – down to .08 now and just a wing and a prayer to get even on a .575 basis.  That being the case, it is logical to DD at .08 in our $25KPs – painful though that may be but our premise is the same – an EU resolution sends us flying but, this time, a move back to .30 will make us happy.  

  22. Interesting post by Springheel Jack this morning.

  23. Good morning again! 

    I had to put up a quick note to DD on the QQQ tomorrow $63s in our $25KP at .08 because they are already .12 and not everyone believes it when we say "ALWAYS sell into the initial excitement."  We only have one actual rule at PSW and that one is it.  Now, you may be thinking that buying calls for .08 is not selling anything and you would be correct but our small portfolios were in no position to sell the $62 puts, which hit .40 so this was the next best thing with the Qs testing the $62 line on no volume and for no reason.   

    This is not about being a knee-jerk contrarian – those kind of traders tend to live a short life.  This is about a position we have studied and believe in with a premise THAT HAS NOT CHANGED when the sentiment shifts drastically against it and gives us an OPPORTUNITY to scale in to a much larger position at a lower price.  

    As noted in the post above – At .50 I said yesterday morning that the conservative move was to cash out these calls.  As it turns out – it would have been a genius move for all of us but this morning could have opened with a .65 move up instead of down and those calls could have been over $1 just as easily.  We decided yesterday morning we were willing to risk the position and it certainly doesn't make sense to say you will risk it but then chicken out when you get a cheaper price on the same position – not if nothing fundamental has changed! 

    That goes for gasoline (/RB), now $2.4825 with oil back at $79.80 (/CL) and both nice bull plays here as well.  The Dow is testing 12,450 (/YM) and a nice long there too.  We have the Supreme Court decision and that can send us flying up or down and I wish I knew which but I can't even tell what people are looking for anymore.  My gut says rally if it's upheld but not much net effect if it's struck down in whole or in part.  

    It's going to be a very crazy couple of days – extremely amusing if you are all in cash, exciting to gamble if you are mainly in cash and agonizing if you are not (but some people like that too).  Either way, let's try to have fun with all the nonsense.  

    At the open: Dow -0.76% to 12531. S&P -0.65% to 1323. Nasdaq -0.78% to 2853.

    Treasurys: 30-year +0.54%. 10-yr +0.31%. 5-yr +0.17%.

    Commodities: Crude -0.75% to $79.61. Gold -0.83% to $1565.35.

    Currencies: Euro -0.28% vs. dollar. Yen -0.43%. Pound +0.32%.

    Market preview: U.S. stock futures and much of Europe islower as skeptism abounds about the EU summit, with the S&P benchmark -0.6%. Barclays (-11.6%) is getting walloped as the implications of the Libor settlement sink in, while JPMorgan is -3.5%on a report that its London Whale loss could reach $9B. Healthcare stocks will be in focus as the Supreme Court is set to rule on Obamacare. Later: Kansas City Fed Mfg Survey, Ag. Prices

    Having not done so on Monday, the Supreme Court is expected to today rule on the constitutionality of the Patient Protection & Affordable Care Act. "This is the biggest policy uncertainty in the S&P," says Deutsche Bank's David Bianco. "I just don’t know what’s going to happen." You can follow the court's live blog here, with a verdict possible at 10 am ET. 

    Q1 Corporate Profits: -$6.4B vs. +16.8B in Q4.

    Q1 GDP (2nd revision): +1.9% vs. +1.9% forecast, +1.9% previous estimate. Price index +2.6% vs. +2.4% previous estimate.

  24. Springheel Jack.   Let them Burn…..


  25. so the nazz must be handling the SCOTUS release?

  26. I bet Scalia is holding things up…..

  27. unconstitutional.

  28. Bloomberg says "helath care law upheld" by SCOTUS

  29. CNN says individual mandate thrown out. Interesting that 2 news sites giving out 2 different emphasis

  30. maybe not. So much for relying television!

  31. STJL/25kAGG – one typo – the TLT Sep117 are puts, right?
    And, of course, thanks far all your hard work with these portfolios

  32. Dollar 82.88 with the Euro bouncing off $1.24 and Pound off $1.55.  

    If you are looking for a futures short, /NKD is right on the 8,800 line and a move below that would be fun to play as they can drop like a rock if things go badly here.  

    Perry/1020 – I'm sorry he didn't make it to the finals.  

    Why is XLF still $14.13 if things are so bad?  Why is JPM only down 3%?   I didn't want to start a public war without good evidence but there's something very fishy about that girls article in DealBook – not the first time I've seen blatantly bogus reporting shoved in there with very interesting timing.  Andrew Ross-Sorkin (aka "Colmes") is the "Editor at Large" and we know who's paying his bills these days.  I don't even read that thing as it has so much bad info.

    Supreme court upholds mandates?!?  That was unexpected but it's actually the correct decision constitutionally – this is great.  I could care less about health care but this means the court is not in the pocket of the GOP and THAT is fantastic!  

    Market not liking it initially but I think a lot of bets were placed on the wrong side of this and step one is to unwind – then the buying should begin.  

  33. mandate goes

  34. I'm going to the beach…..maybe a good time for a little stone skipping….

  35. CNN wrong.  Split decision, but it seems the whole bill was upheld.

  36. typical political move two different decisions they vote after lunch again and reset in the direction of the public polling going on now

  37. YEAH MAD MEN!!

  38. Yes, Rexx, they are puts! Thanks.

    I also corrected one the 25KPA which has 50 of the QQQ calls at $0.08. Hectic morning for me and the internet connection at my vacation condo is not holding up well.

  39. Great upheld—Roberts joined the liberals?   huh!!!!--his Harvard prof was right

  40. WoW!  John Roberts goes with the majority!

  41. mandate as a tax is ok but not as a penalty?
    isn't this crazy no one has it right yet..without the penalty its going to be interesting

  42. I don't believe it! John Roberts joined the liberals!

  43. cool….

  44.  right…so its upheld but as a tax i guess….which makes it a loss for basically everyone..ha

  45. Huge victory for the President and for health care….6-3 vote!

  46. Mandate seems to be held up as a tax, but not under the commerce clause. Just seems like this will open up another can of worms.

  47. angelcur – Yes, but we all have to pay our taxes….

  48. trade market halted..ha

  49. President was adamant saying it wasn't a tax, yet the Supreme Court approves it constitutionally as a tax. Amazing.


  51. intrade market*

  52. lets see how they chime this out president was very clear it wasn't to be imposed as a tax they wanted the commerce clause to facilitate it..i see it as a net net nothing hopefully a win for the uninsured

  53. pretty crafty for scotus minimal political benefit and maybe a net loss for both parties..hahahaha they have a sense of humor

  54. dclark41 – Obama knows using the word "tax" is fodder for the right….it was always a "tax" because you had to pay it.

  55. Short strangle virtual portfolio,
    Roll 2 SPX Jul 1125 short put ($0.425) to 3 Jul 1190 short put ($1.775), for more credit and excitement.  Our long put vertical of July 1265/1260 is worth $0.8, which is more than the current 1125 short put, so by rolling it up, we would have more credit from the shorts than debit from the longs.  You might get more credit for this roll if the market keeps dropping today.

  56. Sorry, typos – should be rolling 3 (three contracts) SPX Jul 1125 short put ($0.425) to 3 Jul 1190 short put ($1.775)

  57. Peter – I'll update your portfolio position after hours today.

  58. 1020
    Shrewd if true? Apparently the lawyers knew what the politicians refused to say.

  59. June 29th QQQ's calls are .03¢ right now

  60. Fox "News" headline: Supreme Court Rules Health Care Mandate Will Become a Tax :)

  61. Funny Business/Snow, DC – Some people want it more than others.  My brother could have had a nice career but he wasn't willing to pay his dues so he went from job to job but was never happy because what he really enjoys is singing (and musicals).  He was once the fly-on entertainer for Carnival – the big act they would fly from ship to ship for a big show and that's where he met his wife (chorus singer/dancer) but, rather than stick with the Biz – they decided to settle down and get married and he went into the car biz – which he's very good at and now he just does the occasional show down in Florida – usually for charities or the church.   My Uncle Lou was a pretty well-known Katskills comedian and my Aunt Vickie is a singer/actress too so I know (and so does Andy) know how hard you have to work every day to succeed in that business – if you don't want it, or NEED it actually – it's almost impossible to make a career out of it.  

    Impact/Dpast – I don't see it as a negative but I guess people aren't thrilled with the tax part.  As above, I think we're getting a big unwinding of wrong bets and now fund managers are scrambling into meetings and allocating capital to buy based on the decision but Europe is still the real story and that will keep us guessing all day.  

    LOL JMM – Damn, do I need to be out of the country that soon?  

    Oil got smacked down as Europe decides to go to trade war with China – also a distraction ahead of the big show, I guess:  

    10:26 AM The EU petitions the WTO over China's export restrictions on rare earths after talks (also including the U.S. and Japan) broke down in April. "China's restrictions … are a violation of the China's WTO commitments and continue to significantly distort global markets."

    10:22 AM Hospital operators are soaring following the Supreme Court validating most of the Healthcare Act. HCA +7.7%CYH+9.65%UHS +8.25%THC +10.6%LPNT +6.4%

    Woops, there goes the market.  Game on for /NKD, TZA in good shape but Qs getting crushed as they fail $62.  I don't know if big build in nat gas freaked people out but it dropped .15 in 10 seconds (now 2.68) and took gasoline down to $2.47 with it.  Dollar climbing fast as we head into last hour of EU markets but 83 should stop the Dollar and stop the drop – HOPEFULLY.  

    Not much to do here but watch and wait.  RUT still a good short if you must chase but I'd wait to see if Dollar pops 83 as we're still at 766.

  62. I'd bet the "don't tread on me" guy has his shorts in a bunch…
    …he's running home to turn on limbaugh, levin, savage and fox…all at the same time!
    So it goes for the angry white guy….

  63. Jack/Diamond – Good post! 

    We're back to Monday's lows now – very nasty if we fail them.  

    There goes 83 on the Dollar!  

    20 TZA July $22 calls at $1.10 in both $25KPs as we don't want to just let this melt on us – stop at .90 is a $400 insurance plan. 


  64. Possible that Europe is selling us off and this will reverse at 11:30.  Banks getting killed over there: 

    After a brief bounce in the tumult following the healthcare ruling, stocks reverse sharply, the DJIA -1.3%. Has the Supreme Court just given the okay for the government to order any sort of commerce as long as it's called a tax? Meanwhile, EU issues remain, and the ramifications of the Libor-probe continue to be felt. Barclays (BCS-17%), RBS -13.3%

  65. impressed with how X and BTU are staying strong.

  66. I may have to watch kudlow tonite….. :)

  67. I think that Angel has it right – this looks like a loss/win for each side. I guess the right gets motivated to vote for Romney because he promised to repeal Obamacare – under what premise now? it's been ruled constitutional. I guess the fact that it's a job killer, but a tough thing to prove although that bunch doesn't need evidence. And the left also gets motivated to preserve what has been upheld now. I still think that it's a good thing for Obama overall – predictions last night were much worse.

    Tough sledding for the Limbaugh and Fox out there though as they were hoping for a nudge from SCOTUS on this one. What's going to be the argument now? That SCOTUS is in the bag with the liberals… 

  68. From a friend of mine who covered the Supreme Court as a reporter and still follows closely…

    Not to pour cold water on an unexpectedly happy day, but: The limits on the Medicaid provision could mean that while survival of law is a victory for most people, states still will be able to keep the poorest of the poor from getting the health care they deserve. To state the obvious: We still need universal health care.

  69. It seems that Scalia and Alito pushed Roberts to side with the liberals – From Kevin Drum:

    Apparently the minority believes the entire act is unconstitutional, lock stock and barrel. Maybe that's why Roberts defected. He might have been up for overturning the mandate, but not the entire law.

  70. phil – should we do anything with the USO 29/30 vertical with this drop?

  71. Got to love IMAX, holding strong with their one two punch of movies for July.  I did hear Spider-Man got bad reviews though.

  72. Speaking of lines, the NYSE is on pace to see a "Death Cross" soon! The 50 and 200 DMA are separated by only 50 points or so.

  73. VIX only $21 but TLT back to $127.28 – lots of mixed signals but we knew it was going to be crazy.  Oil testing $78.50 dollar getting rejected in first attempt at 83.  

    Beach/1020 – Wise plan for the day! 

    32M shares on the Dow at 10:55 – about normal.  Would have been nicer if we had more volume to prove a bottom.  

    QQQs/Amalfi – It's up to Europe to save us now (I know – yeeesh!).  

    All lose/Angel – Yep, good point.  

    80% of the bets on InTrade were that the ruling would be struck down as unconstitutional.  Gives credence to my unwinding of bad bets theory:  

    Why Prediction Markets Fail

    AAPL $568 – Deja vu all over again.  


    10:13: From SCOTUSblog: "The bottom line: the entire ACA is upheld, with the exception that the federal government's power to terminate states' Medicaid funds is narrowly read."

    10:15: CNN reads a piece from the decision, written by Roberts. Says the mandate is upheld under Congress's taxing power.

    10:16: CNN now agrees that the entire law has been upheld.

    10:22: SCOTUSblog excerpts this from the section of the decision on Medicaid expansion: "Nothing in our opinion precludes Congress from offering funds under the ACA to expand the availability of health care, and requiring that states accepting such funds comply with the conditions on their use. What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding."

    10:33: Amy Howe of SCOTUSblog summarizes the ruling: "The Affordable Care Act, including its individual mandate that virtually all Americans buy health insurance, is constitutional. There were not five votes to uphold it on the ground that Congress could use its power to regulate commerce between the states to require everyone to buy health insurance. However, five Justices agreed that the penalty that someone must pay if he refuses to buy insurance is a kind of tax that Congress can impose using its taxing power. That is all that matters. Because the mandate survives, the Court did not need to decide what other parts of the statute were constitutional, except for a provision that required states to comply with new eligibility requirements for Medicaid or risk losing their funding. On that question, the Court held that the provision is constitutional as long as states would only lose new funds if they didn't comply with the new requirements, rather than all of their funding."

    10:38: From a friend: "Man, the right is going to turn on Roberts now. He's going to be the new Souter." No kidding. Roberts is about to become Public Enemy #1 on Fox News.

  74. I never would have believed it, Roberts voting for the mandate.

  75. OK, VVUS is starting to sell off a bit, so, my gamplan…and you will all have to watch closely if you are in the trade…is to make it free.  If the spread can be sold for 60c or greater, sell 1/2….then it is a free trade.  Otherwise, it is rolling dice, but it is my belief that the diapers (er dice) are loaded!

  76. i think the response will be muted from fox (they will call it taking the high ground) this will prevent them from eating anything that looks like crow!

  77. CHK not down!  SVU green, WFR up.  YRCW too.  

    Bottoms are holding so bear premise off for now – we can just take $1.03 and run on the TZAs and lose $140 – beats panicking out off all the bull positions.  

  78. Phil, ok had the DIA July 121 puts as protection from the 6/4 lows.  On the end of week strength last week, I rolled them up to the 124s.  Then, yesterday I rolled them up again to the July 126s.  So, bang this morning, I cash them out paying off both rolls and putting $0.90 in my pocket.
    I use these as very short term bets on market direction.  I use the TZA spreads previously mentioned as my core hedge, but the DIAs to cover headline risks.  I have gotten pretty good at rolling them up as the market goes against me and cashing them when they hit(which can be quite quickly in this market).  Here's my question, taking them off tilts me bullish, however I still fear the EU situation  I think let EU close and see if we rally before putting some back on, just in case the meetings today/tomorrow don't go well.  Looking at like the July 125s if they get back down around $2.00, or the 124s if they go down to $1.50(I like 124 because it seems to be a pretty good floor).  Your thoughts?  Yes, this is just craps money, so very small bet.

  79. last year i said barclays would be nationalized during next recession…its well on its that's one i didn't want to see

  80. revtodd64/universal   Agreed!

  81. Another interesting effect of the health care ruling from Scotusblog (who is the guy when it comes to Supreme Court):

    scotusblog: The rejection of the Commerce Clause and Nec. and Proper Clause should be understood as a major blow to Congress's authority to pass social welfare laws. Using the tax code — especially in the current political environment — to promote social welfare is going to be a very chancy proposition.

  82. rpme/Roberts
    There was an article yesterday by Robert Reich predicting this exact outcome. Feeling was that the SC has so totally disgraced itself with its idiotic decision over Citizens United (and Dred Scott) that Roberts had to do something to show that the geriatric lunatics of the SC are not all tools of the Tea Party living in a la-la land where the majesty of every Pharisaic jot and tittle of the law overrides all human needs.
    After all the health care mandate COULD  have been a government  plan paid for by taxes, but the insurance companies were co-opted in because that is the American way--so to overturn it because the insurance companies are not government entities would be absurd. In any case, Medicare is a tax that is paid out to commercial providers of health care.
    On a more mundane note, I see that BCS, on which I took profits a while back is down 17.5% today on the possibility that some execs may be taken to the Tower of London, beheaded, and have their heads placed on pikes on London Bridge, a privilege usually reserved for the Scots and Mel Gibson.
    I guess this would be a good case for buying into the panic.

  83. Bought more AAPL $580 July Calls… $8.50 
    Bought back the AAPL $600 July calls for $3.20

  84. Just bought some June 29 AAPL 570's for 2.70. Let's get a rally!!!!

  85. VVUS / Pharm – Interistingly, the as VVUS drops, so does the cost of the calendar spread (my average cost is 0.45c, i get 0.11c).  How volatile is VVUS? i was thinking about selling some Jul 22$ puts, to make it neutral.  Cheers!

  86. pharm/vvus    Thanks!  Any adjustments you recommend for the VAR calendar trade from yesterday?  Now down ~40%.

  87. Phil – With this Supreme Court ruling do you see any compelling long term health care plays?

  88. Can anyone post a link to an intelligible description of the ACA (stripped of legislative language, please). Before I spout off, I figure I ought to understand exactly what's in it. I mean, I guess its going to stand.

    I spent most of my career in health care finance, and my assumption from the beginning is that this has to be a big goose to the % of GDP consumed by health care. Lots and lots of winners, but the taxpayer ain't one of them.

  89. Lflan,
      Do you recommend adding to the AAPL July $580 calls at this price ($8.65)?

  90. lulu is getting whipped today – down 8% – down almost 10 dollars this week!

  91. barf / finance  — Health care finance?  What, like giving sick people loans to pay their medical bills?

  92. P.S. The uninsured, for the most part, gain nothing. Most of those people are uninsured because they choose not to pay for it, but now they will have to. And the cost isn't going down unless you are among the small percentage who gets direct subsidy. Those who couldn't get insurance because of health history might benefit, except I don't believe there's a limit on what an insurer can charge those people. Anyway, I would like to actually know the facts.

  93. lucky – with calendars, you have to let them play out.  By my account, they are down $125 on 10 contracts, which is hardly a thing to worry about (for now). 

  94. Phil,
    You mentioned earlier that you might buy JPM at 5% down.  It is creeping to that level, you still think going long is a good idea given the market today?

  95. Looks like LNCR predicted the SC's outcome. Insider trading by the SC?

  96. LNCR — My mistake, looks like a bid to buy out.

  97. health insurance/barfinger:    We have individual health insurance as we work for ourselves.  Premium for family of 5 last year was $1,498 per month, jumped up in October to $1,995 per month.  That is for a plan with $10,000 deductible!  Feels like no limit to what they can charge to us…

  98. LULU:  I think I'll go buy some overpriced yoga wear with some of my profits.  Gotta love a phony company that refers to their customers as "guests"

  99. barfinger/facts   I'd bet you a cold one, that most of those people are uninsured because they need to prioritize a roof over their head, food for their family and the rest of the usual suspects.
    Now if you say "single people under 30" then I would be drinking that cold one…. ;)  

  100. USO/$25KP, JJ – It's still .53, not worth messing with.  

    Spider Man/Rustle – Who cares, it's Spider Man!  Like I'm not gonna go?  I even went to the dopey play and I KNEW that was going to suck.  


    In fact, if Webb’s film has a weak suit, it’s the supervillainy: Ifans’s character is underdeveloped, and his putative tragic fall is more of a gloomy tumble. Some comic-book fans have also criticised the “unconvincing” special effects employed to bring Ifans’s scaly alter ego to life, although I can’t say I’m entirely clear what a convincing rendering of a giant angry lizard in torn purple trousers and a lab coat might look like.

    But that’s not to say The Amazing Spider-Man is short on blockbuster testosterone, and the film’s second half offers more than enough bungee-swinging through Manhattan’s concrete canyons, immaculately rendered in vertiginous, silky-smooth 3D, to satisfy thrill-seekers of either sex.

    Fox/Angel – High ground?  They couldn't find the high ground if they refunded NASA and got launched into space!  

    DIA/Hoss – Very nicely played.  It's kind of like reeling in a marlin – do you go home or drop another $200 worth of bait and commit to another $500 for the boat time and try for another or be happy with the trophy you got?  You're supposed to be bullish until the prior levels break – then you have a .90 buffer so maybe .30 before you have to worry that you should hedge more.  When in doubt, something like that TZA spread at the top is a low-loss way to cover a what-if or, like we did this morning, going for the directional TZA with a tight stop as we test a bottom.  In your scenario – we risked .20 out of the .90 to cover the possibility of the bottom falling out.  Don't forget though, for overnights – the spread is better as we can have one MoFo of a gap up if they have an early decision (or a gap down if they have a slap fight on TV).  

    Tax Code/Rev – Soak the rich.  That will be the theme for the rest of the decade – may as well be honest about it.  

    BCS/JMM – I'd give it more than a day – just in case.  Of course I would love $8 and you can sell some 2014 $8 puts for $1.70 so not a bad small, initial entry if you are impatient but too risky for the Income Portfolio.  

    AAPL/Itrade – Working that one nicely.  

    Health Care/Diamond – I think hospital stocks should do good.  I would think it's good for stocks like ISRG long-term.  Drug cos get more sales but maybe a push-back on prices.  Kind of iffy all around at the moment.  

  101. IMAX/Phil
    I went very heavy on IMAX with calls and 23 puts and stock just for that reason and the fact that Batman has sold out in many IMAX theatres in the first week already and it's still 3 weeks away from opening.

  102. Pharm/VAR    I'm still very much in the early learning stage, so very much appreciate the guidance!!

  103. holy crap aussie- that is serious. Guess that is what we have coming here. At present I can only get insurance through a goverment program as I have retired and have colon cancer in my past ( 3 1/2 years ago thank goodness).

  104. pharmboy- don't look now but CRM is smelling 130 now!

  105. VVUS/dpast – if you can sell some premium to pay for it, sure.  My biggest fear is that something comes out b'f their date (June 27) which takes it up or down, so if you can sell the premium, do it, but do it in small quantities to pay for that play.


    For those new to VVUS and my premise on their failure vs. ARNA (and we were long ARNA a long, long time ago – and some stuck with it), VVUS's drug is a combo pill of toperimate/phenteramine (speed).  Now, I don't have a problem with the 'speed' part, as it is used for weight loss by itself as well as for ADHD, but topiramate is a very wicked drug.  Topiramate is an antipsychotic/antiepileptic, and has side effects in patients that, for me at least, would deem it unusable for weight loss on a grand scale.  That is VVUS's premise, and the FDA also issued a black box warning for myopia and 'secondary angle disclosure'.  Memory issues, motor issues, etc. etc.  I think the FDA's hands are tied, and ARNA is the beneficiary of it.

  106. ACN reporting earnings after the bell today.   They just won a $360M contract to build the State of California's Health Insurance Exchange that is now mandated by the new health law.   Likely to see more of these contracts coming now that states know that they implement these mandates (regardless of what Romney says).    On the downside, ACN does have exposure to Eurostress although they are well-diversified.  I wouldn't be surprised to see a small increase in the dividend, since they generate a large amount of cash and at 2.3% the rate is a little low.  Moreover, with a huge amount of the stock in the hands of retired and ex-partners (including me), there is great unspoken pressure to increase the dividend.
    Buying a few JulWk1 57.5 Calls at .65 and selling Jul 57.5 Puts for 2.70 to play the earnings.  ACN has seen positive post-bell earnings-driven trade in 22 of 31 quarters, and in 17 of those upside evening moves, or 77% of the time, the stock has followed that trade with a more aggressive positive run in the next day's regular session.  

  107. jtom – yes, I am in the 125s and sold the 125 weeklies last friday.  So, again, these are coming in nicely. Now, if it would fall of the cliff, I would be hip hoppity happy…..

  108. aussie260 – WoW!….and I thought I was getting raped….
    $950 a month with a 6k (each, family max.12k) deduct for a family of 4 – And a $500 deduct (each) for prescriptions….
    …maybe I am getting raped…. :(

  109. Lincoln / LULU — Over priced?  I'm guessing your not a butt man.

  110. 1020: "those people" who are uninsured choose not to pay what it costs for a variety of reasons, one large one being the extreme cost. Which this law appears to do nothing about.

  111. Apparently Google has a good one with that 7" tablet and it will be available next month… Review from Engadget of the final product:


    The Nexus 7 is an amazing package for something that costs a penny less than $200. It feels like something that could sell for much more. It has a great screen, solid performance and a clean, clear, uncluttered version of Google's latest operating system, Jelly Bean. From a pure hardware standpoint it beats the Kindle in every way possible — except for content. Amazon's selection almost always trumps that of Google's, both in terms of variety and cost, but that's one wonderful problem to have, because almost all of that content is just as available on the Nexus 7 as it is on the Fire. The only major exception is Amazon Instant Video, and with Netflix, we can live with that.

    So, while we tend to prefer larger tablets that better differentiate themselves from phones, if you've been toying with the idea of getting a real Android slate but didn't want to spend big bucks for a big device, this is what you've been waiting for. This is the best Android tablet for less than $200 and the best budget 7-inch tablet on the market. For the moment. The race to the bottom in the tablet space is, after all, just getting started and, if the Nexus 7 is any indication of what's to come, we're in for a very good ride.

  112.  12:20 PM The momo knife is out in full force today in the retail sector, with favored names such as Chipotle (CMG -4.1%), Lululemon (LULU -7.7%), Under Armour (UA -2.9%), and Monster Beverage (MNST -5.6%) all getting whacked lower on heavy volume

  113. For after hours viewing if ya get the chance……..June 6th came and went this year with little attention.  There are small stories with large lessons all around us. 
    From CBS Sunday Morning with Charles Osgood

  114. Jabo- and we haven't heard a single FU today- LOL!

  115. lucky – I will try to remember to update if I make a move.  I use deltas to play these conservatively.  Since VAR was in a channel (55-60) and the trend (using Opts methods) was up, I decided to pay premium (not something that we normally do at PSW) and buy/sell the 60s.  Any forthcoming volatility will be our friend, as our OTM long calls should hold up well barring a collapse of the market, while the front months should just erode.  

    We did these last year over weekends to catch decay on weekly options, buying monthly SPY and selling the weeklies (delta neutral and we did ok, but sometimes, if your costs from the brokerage are a bit higher on the contract side, it eats into the profits.  That's why I decided to do this one, as it is a lazy man's way to rent the options for a while.

  116. Health insurance / jthoma – that is here, in California!  
    50% premium load for pre-existing conditions, and when we tried to appeal the premium we were told we were lucky to be offered the insurance.  This is not 'insurance' 


  117. aussie/1020 – we're a family of 4 also currently we have a UHC "Cadillac" plan is $1900/mo for us. Now that we're done having kids and they are past the very young years, we're looking to switch to a high deductible ($10k) HSA plan that will run around $450 a month. Have you shopped around? I just looked at ehealthinsurance for some options. The crazy thing is that both kids had multi-day hospital stays that cost around $25k, but we're almost paying that every year anyway. Ridiculous. 

  118. 1020/ For someone in the industry, that does sound like a lot(if your family is in relatively good health) unless it is a group policy.  That does sound reasonable if it is a group policy for four people through an employer.

  119. Lincoln / LULU — here's another good one — Yoga pants banned at local high school.  Those pants are like crack to some girls/women.  Once you ban it, it gets more enticing, right?

  120. FU ABX!!!

  121. barfinger – I get it, but look at my own example above. That does not include the fact that each of us are allowed one
    "wellness check" a year, more than that, you start paying towards your deduct.
    Yes, we have "choices" everyday, but that is the rights view on the matter, not mine…..
    Universal health care is the only place to start. Why some in this country think we always need to re-invent the wheel?

  122. now I feel better!

  123. JPM/Phil – my contacts note that 'others' close to the situation were noting that JPM was selling high coupon debt in droves to book profit so they could 'say' that they were losing only $2B.  Why would you sell a profitable investment – banks DO NOT do that in normal circumstances?  So, I think the article is more right than wrong.  In addition, the banks are able to move money around on the balance sheet that shields losses in ways that makes our heads spin (I wish I could do what they do to shield my income….).  Maybe lvmoda can chime in, but I think the financials are toast, it's just we cannot smell the burnt parts yet.

  124. Pharmboy- One you may wish to look at if you have not- N- just as crazy as CRM without the industry position- today is the 1st day they have really hit it.

  125. FU UCO!!!

  126. FU HPQ!!!
    FU FCX!!!

  127. shop around / kurtww – yes, just shopped around on a recent trip back to Australia… Their system might just be the better option for us!

    Medicare is the scheme that gives Australian residents access to health care. To help fund the scheme, most taxpayers pay a Medicare levy of 1.5% of their taxable income.

    Your Medicare levy is reduced if your income is below a certain threshold and in some cases you may not have to pay the levy at all. The thresholds are higher for seniors. If your income is above the thresholds, you may still qualify for a reduction based on your family taxable income.

    Add (optional) full private top hospital cover that includes extras such as optical, physio and dental for $445 a month…for us this is a better deal, and we can sleep right at night knowing that our fellow Aussies are also covered.

  128. Thank you Phil.  You are the one that taught me to roll those up quickly, hardest part of the game IMO.  Learning to roll them up when they are only down 10-15%, because when you do get a move down like today, it more than pays for it.
    Ok, so I'll step aside and wait to see what happens.  If we get back to the top of our ranges, then I'll look to put on a few DIAs just in case.  Thank you for the explanation and description.  LOL on "Slapfight on television"…

  129. Health insurance inflation.
    My health insurance in the Dominican Republic has just gone up 35% from $70 per month to $95 per month for three people  ($32 each.) Not only that, but there is a $7.50 deductible for a visit to the emergency room, and  pregnancy is not covered for the first 90 days. To make matters worse an ultrasound yesterday (an additional $35) confirmed that an additional female family member is expected to require pediatric services as of the first week in October.

  130. Commodities will take this baby down..SHJ has $40 pegged for oil, and if JPM, GS and others were piling into Aluminum, copper, etc….it is gonna be a blood bath.  They better hope for QExx, but it ain't gonna happen.  Come on
    EU, make my day and postpone it yet AGAIN….

  131. aussie — no doubt, if I open up the possibilities and really shop around, there are some other places that become very appealing. Health insurance, private school, mortgage… ugh. 

  132. inkarri19 – We do not have a group policy – twin 12 y.o.'s, Mom 45, the old man 50 and relatively good health.
    And we consider ourselves smart shoppers who are very aware on how we use our insurance….

  133. Oh Jabo, I am sooooooo jealous; as always happens, once I gave up shorting CMG after six months - boom!

  134. And then there is the local beach….just took the plunge and bought some Sydney real estate again…

  135. Jabo – did you say something?…. ;)

  136. jmm — Congratulations!! Nice on the costs…  I'm guessing the delivery won't be in the $10-15k range like ours were, either. 

  137. Congrats jmm!  :)

  138. Pharm—VRTX taking a hit—would you sell some puts here?

  139. I guess the markets will turn up after the 7-year note auction :-) . I hope so…

  140. Congrats jmm, fantastic news

  141. BBBW update
    Please see which has been updated.  (Please forgive the imperfect text formatting there.  Something goes slightly awry between the way I write it and the way it appears.)
    Everyone who responded to Craig's information gatherer was sent last night an email discussing ownership of the management company and the financing of the business.
    If you did not receive that email and you would like to receive it please let me know and post your email address here, on the BBBW blog or write to me at
    Thank you.

  142. Pharm – $40 oil and GS/JPM dump of commodies? ..  yikes, you are scaring me!

  143. ABX – if the VIX gets a bit higher and may be time to sell puts

  144. CLDX – I am selling a 1/2 straddle position (Aug $5 C/P) for 95c (so if you have 200 shares, I am selling 1 contract of each).  They can take 1/2 the stock from me, or give me more shares.  We are up big on this stock.

  145. Good collection of notes on health care decision.  Keep in mind this is all a first step in a long, long battle towards Socialized Medicine (oops, wasn't supposed to say that with Conservatives in the room!).   As to "choosing not to pay for it" – yeah, and those same bums "choose" not to pay 4 year's income for college for each of their kids or to save for their own retirement or to fix their AC and, when the cartels get a hold of water, I bet they'll "choose" to die of thirst as well.  Better to do it quickly and decrease the surplus population, right?  

    Meanwhile, can you imagine how pissed some rich guys are going to be when they are waiting for a kidney and a poor person is ahead of them on the list?  Outrageous!!!  

    JPM/Ging – Yeah, I was hoping that would occur in isolation!  Not much to stop them from testing $32 in a weak market so I'm not too keen.  Would rather play XLF/FAS bullish in anticipation of a Euro save.   Notice this nonsense has totally gotten everyone to stop thinking about them today?  

    IMAX/Rustle – Very steep drop off for them around the opening weekend.  If Spider Man gets them to $25 – I'd be happy with that.  

    ACN/LV – Nice stock.  

    GOOG Tablet/StJ – Made in America!  I'm surprised that's not the first thing people say about it.  

    MA fall down go boom.  

    DDay/Living – I couldn't believe they didn't even have "Saving Private Ryan" on cable.  I was looking for it for my kids – we had a lot of family serving in that war.  

    ABX/Jabob – Gold down to $550.  Rupee still hitting lows and that's a major consumer buyer that's getting hit.  

    Dollar still over 83.  Euro $1.2425 and Pound catching down to the Euro at $1.5488.

    Oil $78.13 – that's pretty low!  Nat gas $2.69, gasoline $2.475

    JPM/Pharm – I'm not saying they won't cheat but you will not get a $9Bn figure out of them, or $5Bn for that matter.  I expect lower than $4Bn and wouldn't be surprised with under $2Bn because Jamie said so and, if Jamie said so – then you may as well summon Satan and draw up the contract.  

    UCO/Jabob – Looking very interesting at $23.65.  Jan $20 puts can be sold for $3 which is 15% lower on the 2x ultra so roughly $72 oil so I like that for a put sale to offset a bear hedge (and break-even is 15% lower so $65 oil!).  

    You're welcome Hoss, congrats on mastering those rolls.  

    DR/JMM – Our hearts bleed for you man… 

    Beach/Aussie – Not too close to the water, I hope.  That Global warming can creep up on you.   Oh, I live those homes on the rick there!  

    ABX/Scott – 2014 $30 puts can be sold for $4.25 – what's not to like?  

  146. VRTX – damn, sorry I missed that one.  Well, the drug does not work in a population of patients as a mono therapy.  OK then, that is fine.  I think it is overdone, but let's give it a day or two.  The stock was at 39 b'f the data, fell to 49 after they announced additional data (which was revised), and now back to the 54 area.  48 should hold (slippage), so selling a few 48s or 45s should be fine, and easily rollable if one is so inclined.  Otherwise, selling Jan13 $40 puts are a good, lazy way to play but I think we can do better.

  147. Phuil—do you know if UCO has the same decay problem like the other ultras?

  148. BBY bucking the trend!

  149. Beach/Phil – Not beachfront,  however sold one right on the beach 10 years ago because I agree with you re global warming!  Just a nIce, quiet  3/4 of an acre block within strolling distance to the beach and village.  Bliss!

  150. Thanks Pharm

  151. QQQ – taking a flyer and bot some at .05 and .04 today. Be nice if something gets 'fixed' today.. but what might that be?

  152. Opex Crazy Play - bot a few NFLX 67.50/70 BCS for .50, it's painting a bullish engulfing so maybe they intend to close it higher tomorrow.

  153. "Life, liberty and the pursuit of Happiness"  
    Pursuit of happiness – Mostly attitude and and a subsciption to PSW.  :)
    Liberty – Got guns?
    Life – What's life without good health?
    Off to the Del Mar Fair – Have a good day everyone!
    Life – Can't have it without good health.

  154. Don't see how they can be serious about this sell-off if VXX hasn't budged.

  155. Phil (and anyone else with a strong opinion) – if you have sold premium that is going the wrong way, and assuming your premise for doing so hasn't changed, is there a general rule for when it is best to roll and DD?  Is it is a function of price, time remaining before expiration, both?  Other factors?  If you could use an example in your answer, it would be helpful and much appreciated.

  156. mrmocha VIX is up 6% but you would think that it would be much more…

  157. Yeah, mrm – and home builders are up. 

  158. Today's Ironies:


    1. Conservatives devastated that Chief Justice Roberts chose path of judicial restraint.

    2. According to today’s statement, Mitt Romney supports virtually every provision of ‘Obamacare’ other than the mandate that he pioneered.

  159. BBBW email / Chris D
    When I reply to your email it bounces back undelivered.

  160. MrMocha – I like the NFLX Crazy Friday idea.  My next two to three Fridays are booked with moving stuff, but I look forward to trying some OPEX trading on Fridays later in July.

  161. Made in America / Phil – So much for the fact that we can't do it anymore. We'll see if Google sells millions of these tablets and proves that we don't need Foxconn to do it… And still keep it competitively priced.

  162. X curiously strong today, too.

  163. Jabo, I've been hedging lately with VXX the past few months instead of VIX, and it's only up a paltry 1%.

  164. Savi – can you please re-type your email for the vegas Paypal payment ..

  165. Mrmocha there is something very wrong with VXX.. I have seen others speak about it here.

  166. AAPL…uh oh

  167. ohhh VXX sucks, have lost my shorts on that POS and if I was dead right lucky to scratch out a few cents, never again.

  168. 1020 / Del Mar Fair — I'm jealous – 10 years in La Jolla made the fair a quick jaunt up the coast [forget the 5] and I miss it. Have fun!

  169. VXX / Jabo – Broken…. 

  170. Mrm, I am using VXX also buying the stock and selling weekly calls, slightly higher – been working good

  171. partha—-send thru paypal—

  172. ronresnick – trying from another email…

  173. VXX/mrm - i hate that thing. as i said in May: (04-May-2012 02:32:51 PM) – "VXX – closed and i'm out of this dysfunctional margin-sucking bankster's kosh!"

  174. GNW :)

    Highfields Capital Management reports 5.2% stake in Genworth

    Highfields Capital Management has maintained an ongoing dialogue with the Issuer’s management regarding performance, allocation of capital and structural issues. The Reporting Persons expect to continue such dialogue with the Issuer, and with other interested persons, and in particular to address options available to the Issuer related to its global mortgage insurance assets, its U.S. mortgage insurance assets and its retirement and protection businesses. The Reporting Persons expect such discussions will address risk mitigation strategies, possible sale or spin of assets, and similar matters.. 

  175. I just entered an EWZ short position as a hedge.  Market cap $6.66 Billion — that should help!

  176. DMND really enjoying its time in the woodshed I guess.  But what does the low volume say?  Selling August $16 puts.

  177. jomptien – Yeah, that's why I made the switch to VXX, bid/ask on VIX was frustrating during big moves, and no weeklies to play with.  Lately, however, VXX is definitely broken.

  178. Savi/Vegas – what is the the deadline to pay?  And how much?  TIA

  179. GNW – Figures… I sold a few days ago.  Same with ACI (up 4%).  
    Must be the HWT (HELL WITH THIS!!!) forward indicator at work .  Similar to Jabo's FU but works only with an actual sale!
    Now that I mention, I sold most of X at 19 a few weeks back but re-bought so may not work any more :-)

  180. GOOG Tablet – Made in America??  I don't think so.  Nexus 7 are made by Asus, I don't think they have any manufacturing facility in USA.  Only Nexus Q is made in US as the report.

  181. CMG / Guys just to highlight that CMG is approaching the 200MA.  Maybe it gets a bounce here. i am thinking about buying a Jul 29 call for the fun play of the week..

  182. Or, the lack of movement in the VXX may signal a pop into the close…wishful thinking maybe

  183. VVUS / Pharm – you sound pretty convicing on the VVUS doom case.  So do you think this is a high probability trade? (i.e. load up the truck?)  Cheers

  184. Savi,
    $200 for Vegas. Are we eating at Nobu again? I assume the bulk of the $200 is for the sessions that includes food, drinks, seminar materials and setup at Cafe Moda (AKA Big Bad Bills place!)

  185. Anyone know why MET trades at a 5.5 PE?  Jan 13 26 Puts can be sold for $2.30…almost a 20% discount to current price

  186. "….can you imagine how pissed some rich guys are going to be when they are waiting for a kidney and a poor person is ahead of them on the list…"
    You cannot seriously believe a rich person is going to participate in a Socialized system of medical services. 
    I 'don't care about the health care law. either,  because I'm not going to use much, if any of  it.  Pay some more taxes for the poor to have ——what will eventually be a sorry form of 'medical care', ——but my own medical care will increasingly be of the concierge variety. I'd venture to say that rich people will have their kidney long before the next poor guy on the waiting list.

  187. Competition for Amazon from Google:

    As anticipated, Google has just launched its cloud service for businesses at Google I/O 2012, called Google Compute Engine. Starting today Urs Holzle announced "anyone with large-scale computing needs" can access the infrastructure and efficiency of Google's datacenters. The company is promising both performance and stability — Amazon EC2 they're coming for you — claiming "this is how infrastructure as a service is supposed to work". It's also promising "50 percent more computes per dollar" than competitors. Beta testers will be on hand at later meetings to give impressions of the service, if you want to know how running your apps on 700,000 (and counting) cores feels. During the presentation we got a demo of a genome app and we're sure if we understood what was going on, it would have been impressive.

  188. PHIL GROUND// that is true but this is where you find out the bottom of the barrel has a root cellar…they will nevertheless make pretend…let's watch how they pitch it..what happened to dennis miller btw

  189. Phil – Ive been stuck at Bagram for two days trying to get home for a little R&R,….. What daytrade do you like right now? I need to make some money to pay for these two hour massages Ive been getting! lol

  190. VVUS/dpast – I am just weighing my opinion into it.  I think Adam F. and others feel very different. When all the pundits agree, something else is going to happen…..B. Ferrel's rule #9.

  191. Flip—do you like being the Rush Limbaugh of PSW—-it seems you just like to provoke people

  192. VVUS / Pharm – Thanks.  In the article it mentions that the FDA decision is Jul 17.  Thats before options expiration. IF they get rejected then there the short puts are in risk. Am i wrong?

  193. savi- there is an ignore this user box you can check0 LOL!

  194. Phil,
    Any trade you recommend in TNA?

  195. dpastramas  / CMG – and about $5 below the 200 is the multi-year uptrend line, so will be interesting to see what happens if it gets below the 200 and hits that.

  196. Phil, what do you think about CROX at $15.30? thanks

  197. QQQ – MSFT seems to have found a resting place, AAPL and AMZN maybe still a bit to go? looking for these guys to stop moving down so the Nas can make my QQQs mo'betta!

  198. Lflan,  Are you contemplating a DD on the 580's at some point?

  199. Savi: There is some truth to be found almost everywhere.  Unpopular opinions need to be heard.  Jww spoke of cheap health insurance in the Dominican Republic.  It's true, but I spoke to a friend who lives there last week with no insurance, and he told me that when he showed up at a hospital, there was a 7 hour wait for a doctor — but those who paid cash were ushered in immediately.  Surprised? Is there now a free lunch?  Consider that almost 70% of U.S. health care expenses are occasioned by tobacco, alcohol and obesity. That means that those who live clean are forced to subsidize those who aren't, and it appears this will now be amplified by the new law.  One can argue these points from a moral, economic or behavioral standpoint, but one should not suppress or demonize disagreement.  As has been [mis]attributed to Voltaire: " "I disapprove of what you say, but I will defend to the death your right to say it." 

  200. Geez, getting nowhere.  

    If you're looking to trade on today's Supreme Court decision in healthcare – don't – warns CNBC Fast Money trader Stephen Weiss. “I wouldn’t do anything,” he says. The story isn't over so it's impossible to make an informed decision on anything. For example: “What if the public doesn’t like this – and Romney shoots higher in the polls?” Weiss asks. That changes the trade entirely.

     "Not buying health insurance is not an activity," says Richard Epstein on Scotus blog of the Supreme Court opinion on the individual mandate. "I am not aware of any tax imposed on individuals for not buying gasoline and not earning income, or not taking a bath or not working in a home office." To allow it to stand as a tax is absurd, Epstein thunders. 

    While the Supreme Court opinion on healthcare is being called a drag on the retail sector by industry insiders, especially so for high-growth stories such as Chipotle (CMG -4.6%), Starbucks (SBUX-2.1%), and Dunkin' Brands (DNKN -3.2%), NBG's Brian Sozzi suggests a way to trade the news. He throws out WAGCVS, andTGT as retail names that already have their employee structure in place and could be good long-term plays under the current retail environment. 

    The bottom line for employers of the Supreme Courthealthcare opinion is that most companies won't drop coverage for workers, but some might rework their plans and smaller ones could delay hiring. That's because firms with 50+ workers will be liable for a fine starting at $2K per employee if they don't provide insurance. "That will flat out limit us to 49 employees," says one small-business exec.

    Bad 7-year auction not helping: 

    1:06 PM The Treasury sells $29B in seven-year notes at 1.075%. Bid-to-cover ratio of 2.64, vs. a recent average of 2.87; indirect bidders take 42%, vs. a recent 41.4%. Direct bidders take 6.5%, vs. a recent 16.5%.

    UCO/Jabob – Sure, they all do but UCO is not so bad.  

    Rule/Bolt – Roll yes, but DD is a big decision.  Much bigger hole to dig yourself when you do and very much depends on the situation.  

    GOOG/StJ – I certainly hope so.  Not good for shippers if we start making things in America again.  

    FYI Bob.  

    X/Rky – Like Altoids!  

    VXX curiously low at $17.18.  Next week $18 calls at .45 are interesting and so is July $16/17 bull call spread at .48 – pays 100% unless VXX goes lower from here.   It's not as broken as it seems – just laggy.  Better for betting bear side than bull but low enough to poke at for a hedge I think.  

    MET/Cdel – Not much opportunity to make conservative money on reserves in low-rate environment.  Killing all the insurance cos but still good long-term plays because cash is king and they are swimming in it.  

    LOL Diamond:  

    The Official Dilbert Website featuring Scott Adams Dilbert strips, animations and more

    Concierge care/Flips – As Aussie notes above, when there is universal health care, as in Australia, he can buy the premium package for $450 a month – works like that in Europe too so even rich people benefit from a more equal distribution of health care.  Still, more people able to "afford" kidneys means more competition for parts but, then again, we have over 7M people in captivity in this country – add another conservative judge and we turn the prisons into organ farms like China and you'll be well-supplied for spare parts.  

    Day trades/Jrom – CASH!  Look at what a mess this market is.  You should take your cash and check out Bagram's #1 attraction (according to trip advisor):


    Bagram Airfield

    #1of 1 attractions in Bagram
    1 of 5 stars1 review

    Attraction type  Military Bases/ Facilities






    I'm sure we all envy you the vacation of a lifetime over there in Bagram!  If you want a thrill ride, you can now buy the QQQ next week $61/62 bull call spread for .55 and that should be able to stop out with a .20-25 loss if things go badly tomorrow but make a nice double if the Qs head back up (now $61.58).  Note we got wiped out on our this week $63s so not at all a sure thing.  

    Also, UCO just seems silly at $23.50 with July 4th coming up – I like the July $23/24 bull call spread at .50.

    TNA next weekly $47 calls at $2.15 are also fun but those can cost you if things go the wrong way but TNA was $50 2 days ago and $52.50 2 weeks ago so they could make a nice payoff quickly. 

    Damn, I guess I still think the EU comes through tomorrow….

    Rush/Savi – Missed the end of that but very insulting beginning!  

    TNA/Jasu – What a fantastic idea – see above. 

    CROX/Jophil – Not bad but I'd rather wait until we know for sure the Global economy isn't going to completely collapse. 

  201. i am all for flip or anyone else  commenting so long as its not a profanity laced diatribe (with me as its object)..after all we cannot be lefties with out a high and abiding commitment to free speech..and i am being somewhat serious here..back to you PHIL

  202. Phil – I bet you could negotiate a great Health insurance package for all of us at PSW, if there is one to be had.  I bet a lot of us are self-employed.  Or we could all chip in and buy an island / start our own country.  First priority would be good internet so we could keep trading.

  203. Yeah, I noticed that dpast and have been checking different sources.  My supposedly reliable source said 27th, but my dyslexic brain/eyes deceived me and it was June 27 (arna) and July 17 VVUS.  So, we will have to ride the storm until the Friday b'f expiration (13th) and then make a decision.  The time decay will work in or favor, and selling the puts for a few days to a week would be advisable.  Maybe even the OTM calls until after the 4th, but the volatility should also increase so these better be way OTM. Will be an interesting time non-the-less.

  204. ZZ--no way was  I trying to suppress or demonize a disagreement--where do you see that—just stating an observation and a question—I do not have anyone on ignore  —I read all comments

  205. It's 3 o'clock..U know what that means!

  206. Correct me Savi, but maybe you were reflecting on a time not too long ago when some members just dumped raw invective on the board without regard for anything but their free speech right (which, as it happened to a few, Phil took away).   I think we lost a lot of quality members and intelligent stock commentary due to a vocal few when PSW degraded to a political war zone.   I sure hope that doesn't happen again…

  207. savi i think someone must be designated to demonize and suppress..we need a diverse cross section..i think we should have a colored box for this..(no i am not volunteering)

  208. Can someone send me BBBW info to

  209. lvmoda…here here.

  210. Phil, please reread your link, as I wrote, Nexus Q is made in the US but it's not a Tablet. Nexus 7 is a Tablet whaich made by Asus… not made in USA.
    I maybe wrong but even your link wrote nothing about Nexus 7 tables.

    NTE for those of you who have positions in one of my two largest positions mentioned here on the board NTE just announced retaining Cameron Associates as their new IR firm.

  212. Unreal….going right back up to S1, which is R1 now on SPY 132.29.  HFT is so predictable.  It's those AH moves that really do the damage.

  213. Savi:  "Provocation" was the word I noticed.  Disagreement is not provocation, unless delivered as Angel describes.

  214. Pharm – yesterday, you said $8-10 is where you would value ARNA (now around $10).  Was that a fundamental assessment, or just what you think the market will say it's worth in the near term?  Does $8-10 assume VVUS will be denied, or would a denial increase your valuation of ARNA?
    Lastly, would you consider a bullish ARNA entry of some kind today?

  215. Pharm / SNTA - great instincts there, buddy!  Recall that last week you told me " SNTA was a good pick, but the risk for me was a bit great as there are several Hsp90 inhibitors out there"

  216. Phil – lol. I know bagram quite well, had to spend 8 days here when they burned the Korans. Ill stick to my daily routine of workout, shower, eat, workout, shower,eat, massage, shower, read your blog, sleep. Wont be able to hit up LA when I get back though, we are planning on doing the disney gig when I get back in Jan.. THanks for the recommendations, I will definitely try a few of those spreads!  

  217. all point taken

  218. ZERO to quote KARL "Slingblade" Childers: I like the way you talk.
    I think the president is taking a calculated risk saying this isn't a tax.. thoughts?

  219. JROM I stopped dead at the massage. Who? My nephew was a sniper in iraq for two years..thank you for your service..

  220. JPM missed my target by a dime.  Good sign though.  XLF hit $14 for about a second. 

    I love that Mitt is now actually planning to run on a platform of taking away health care!  Well, might play better than running on just taking away Social Security and Medicare… 

    Meanwhile, from Monday, our do not cross lines from the morning Alert were:  Dow 12,400, S&P 1,310, Nas 2,800, NYSE 7,450 and RUT 750.

    Lows today were: Dow 12,450, S&P 1,314, Nas 2,820, NYSE 7,500 and RUT 764 – so what are people worrying about? 

    10:00 AM On the hour: Dow -0.81%. 10-yr +0.31%. Euro -0.25% vs. dollar. Crude -0.56% to $79.76. Gold -1.01% to $1562.45.

    11:00 AM On the hour: Dow -1.25%. 10-yr +0.3%. Euro -0.35% vs. dollar. Crude -2.02% to $78.59. Gold -1.49% to $1554.85.

    11:41 AM European shares close mixed as the latest EU summit gets underway, the question being will they (the Germans) or won't they go for jointly issued European debt. Stoxx 50 -0.3%, Germany -1.3%, France -0.3%, Italy +0.8%, Spain +0.9%, U.K. -0.5%, with crushingLibor-related losses in 2 of its biggest banks, and just major losses in 2 others. EUFN -3%.

    12:00 PM On the hour: Dow -1.05%. 10-yr +0.32%. Euro -0.28% vs. dollar. Crude -1.92% to $78.67. Gold -1.49% to $1554.95.

    1:00 PM On the hour: Dow -1.05%. 10-yr +0.31%. Euro -0.34% vs. dollar. Crude -2.36% to $78.32. Gold -1.66% to $1552.25.

    2:00 PM On the hour: Dow -1.14%. 10-yr +0.3%. Euro -0.37% vs. dollar. Crude -2.99% to $77.81. Gold -1.68% to $1551.95.

    3:00 PM On the hour: Dow -1.17%. 10-yr +0.29%. Euro -0.33% vs. dollar. Crude -2.71% to $78.04. Gold -1.66% to $1552.25

    "I am functioning in contrarian mode," says Ken Heebner, his portfolio positioned for a stronger U.S. economy. The man who once walked between the raindrops has seen his CGM Focus Fund lose an average 6.3% over the past 5 years and trail 96% of its peers. Top holdings include CDALWHR, and DHI

    Maybe individual investors aren't fleeing the stock market as much as everyone thought, as Vanguard’s annual survey of the 3M-plus Americans who participate in retirement plans it administers shows two-thirds still have their money riding on stocks. Fully 71% of the contributions from their current paychecks are going into stocks, higher than in 2009 and 2010.

    The 7% return expected/needed by pension funds is "comical" in this environment, writes Bill Gross, relating a story from Mike Bloomberg that if someone offers you 7% guaranteed for life right now, take it – just make sure their name isn't Madoff. "Don't underweight Uncle Sam in a debt crisis," says Gross, sticking – for now – with the negative real yields offered by Treasurys. 

    The "upshot for the health-care industry" of the Supreme Court's healthcare opinion is that it will receive "an influx of more than 30M newly covered people," writes the WSJ's Anna Mathews. The ruling will give momentum to shifts that were already occurring, such as structural changes at health-care providers and insurers, as well as consolidation. 

    The U.K.'s AAA rating looks increasingly vulnerable, writes Jim Leaviss, as growth and deficit conditions have both deteriorated since the country was put on negative outlook by Moody's and Fitch. While the move would be an embarrassment for the Cameron government, record-low government bond yields (10-year at 1.63%) are likely to ignore it, if recent history is any guide.

    The momo knife is out in full force today in the retail sector, with favored names such as Chipotle (CMG -4.1%), Lululemon (LULU-7.7%), Under Armour (UA -2.9%), and Monster Beverage (MNST-5.6%) all getting whacked lower on heavy volume.

    Delusional much?  Feeling it's put the negativity associated with getting bailed out behind it, AIG will resume using its brand name – AIG – with the public again. "The increasingly positive sentiment toward AIG is a powerful asset," says CEO Bob Benmosche in a memo to staff.

    Corn takes a breather from its big June run (up 27%), but a once-in-a-generation drought continues to bear down on the Midwest. A drought map shows the brutal conditions – originally centered on Indiana – making their way into Illinois and even Iowa.

    Rising U.S. corn prices in the face of a Midwest drought have forced Valero Energy (VLO) to shut two of its 10 ethanol plants, each with the capacity to produce 120M gallons of ethanol per year. Rabobank analysts predict corn prices could rise another 25% by year's end on lower yields due to the weather, pushing prices near the all-time high of $7.99/bushel.

    Comex gold declined $28, or 1.8%, to settle at $1,550.40/oz. as the European summit begins with little hope of progress and a higher dollar keeps gold and other commodities under pressure. Also, decreased physical demand from countries such as India is hurting demand for gold. Miners take a beatingGG -5.1%,AUY -3.1%KGC -6.2%AEM -4.6%NGD -3.1%

    Silver falls 2.6% to a 19-month low of $26.23, but thus far there are no signs of a rush out SLV. A key area of support is $26, says Michael Shaoul, with the next stop on the charts being $17.50 – the point at which the metal began its big run in 2010. The miners (SIL-2.6%) have performed better than the metal (-7.6%) during June.

    Ah, this hurt oil today – loss of fear factor:  Saudi Arabia has reopened an old oil pipeline built by Iraq to bypass Gulf shipping lanes, giving it scope to export more of its crude from Red Sea terminals should Iran try to block the Strait of Hormuz, Reuters reports. Sources say tests through the 1.65M bbl/day line had delivered into Red Sea storage facilities for at least four months.

    Investors are currently cautious on commodities, but expect better performance and a higher exposure to the sector over the coming year, finds Credit Suisse in a survey of institutional players and family offices. The difficulty now is the high correlation with equities – typically a selling point for commodities is their ability to deliver when stocks don't.

    JPMorgan's Mark Moskowitz has cut his targets for 12 IT hardware companies, including Dell (DELL -3.8%), H-P (HPQ -1.1%), and Western Digital (WDC -3.1%). He cites weak Euro IT spending, Chinese growth worries, and the impact of a strong dollar on exports. Targets are also cut for Apple (AAPL), IBMEMC, and NetApp (NTAP), but Moskowitz is more positive on their ability to weather the storm. (STX/WDC downgrade)

    In addition to ThinkEquity and JPMorgan, Barclays' Ben Reitzes has issued a downbeat note about Seagate (STX -6.6%) and Western Digital (WDC -4.6%). Reitzes says checks indicate PC build activity was weaker than expected in Q2, and thinks notebook drive sales could disappoint. Also: hard drive assembly supplier Hutchinson (HTCH -11.7%) has issued a June quarter warning. Hard drive chipmakers LSI (LSI -3.7%) and Marvell (MRVL -3.4%) are also underperforming. (previous)

    Desperation rumor:  Starbucks (SBUX -2.5%) buying Green Mountain Coffee Roasters (GMCR -0.8%makes sense to The Motley Fool based on the emerging strategic fit between the two companies. Even allowing for a hefty premium – say $30 – a SBUX-GMCR deal goes off at a reasonable valuation in a merger that would give the combined company the muscle to outlive worries over K-Cup revenue and patent expirations as the single-cup market matures.

    The good news for Tesla Motors (TSLA +0.4%) investors is that reviews on the new Model S are smashing, but the bad news is that a boost in revenue for the company could be slow in coming. A buyer today for a Model S has to plop down a $5K deposit, but the balance isn't due until the delivery date – which currently averages about 11 months down the road. Execs with Tesla say they hope to cut the wait time down to 3 months.

    Something else that will be made in America (or Alabama anyway):  Airbus reportedly will announce plans for a commercial jet assembly line in Alabama, its first in the U.S., to meet demand as North American airlines renew their fleets. Airbus is being politically astute in bringing production directly to U.S. customers, analysts say; it likely also has discovered it is economical to do work in the U.S. deep South, where labor is usually cheap. 

    "It’s going to be terrible with a scoop of worse for August," says Jefferies analyst Peter Misek of RIM's (RIMM) FQ1 report, which is due after the bell. The BlackBerry maker is expected to swing to a net loss per share of $0.03 from a profit of $1.33, with revenue seen plunging to $3.1B from $4.9B. Yesterday, RIM received yet more harsh commentary from analysts.

    Expectations for Research In Motion (RIMM -0.9%) areextremely low heading into this afternoon's FQ1 report, especially following notes from Credit Suisse and Morgan Stanley. But low expectations haven't stopped RIM from disappointing in the past. Canaccord's Mike Walkley is joining in by forecasting a

  221. CRM – 1/2 out.  Will look at reloading EOD or tomorrow.

  222. Pharm/ HFT
    Good points! I watching IWM creep up with little volume, less cash inflows, but up nonetheless! 

  223. Expectations for Research In Motion (
    RIMM -0.9%) areextremely low heading into this afternoon's FQ1 report, especially following notes from Credit Suisse and Morgan Stanley. But low expectations haven't stopped RIM from disappointing in the past. Canaccord's Mike Walkley is joining in by forecasting a big miss, and stating most of RIM's value now lies in its network operations centers (previous) and 78M subscribers (~20M enterprise), which could appeal to Google or Microsoft.

    More on Research In Motion: The WSJ does a post-mortem on RIM's (RIMM) fall from grace. The unsurprising conclusion, following talks with many RIM and industry execs: RIM was felled by "a blinding confidence" in the BlackBerry even as iPhone and Android sales took off. Also, RIM was paralyzed by the dueling fiefdoms of former co-CEOs Jim Balsillie and Mike Lazaridis, and hurt by askeptical attitude towards multimedia features demanded by consumers.

    Google's (GOOGNexus 7 tablet, the day after: 1) Analysts are mostly unenthusiastic. Credit Suisse thinks the Nexus 7's window is limited if an iPad Mini is on the way. Needham believes weakeningKindle Fire demand doesn't bode well for the Nexus, and Sterne Agee argues Microsoft is more at risk than Apple. 2) The Verge thinks the 7's international availability (the Kindle Fire is still U.S.-only) could prove crucial. 3) AnandTech provides a positive review of the 7's hardware. (previous)

     The next Kindle Fire (AMZN) will ship in August, feature a 7.85" display, sell for $199, and be thinner than the current Fire, sources tell Digitimes. The report comes as Raymond Jamespublishes a survey in which 26.1% of respondents say they'd buy a 7", $300 iPad (AAPL). This compares with 16.5% who say they'd buy a Kindle Fire or $200 Android tablet, 22.9% who only want a 10" tablet (probably the regular iPad), and 34.4% who have no interest in tablets. (previous: IIIIII

    How great is it to be AAPL – they get mentioned every time someone mentions either a phone or a tablet in almost any context!  

    Apple (AAPL) is reportedly prepping a major overhaul to its iTunes music/video store. New features are said to include tighter iCloud, Facebook, and Twitter integration, better file management, and (courtesy of new studio deals) the ability to listen to songs shared by friends for free. It's added music studios are pushing Apple to offer a Spotify-like subscription service, but the company isn't biting. Apple recently shuttered its Ping music-sharing social network due to weak interest.

    Three lunchtime reads:

    1) New indications housing recovery is under way

    2) Five best ETFs launched in the past year

    3) Fed officials differ on whether more easing needed 

  224. ARNA – fundamentals.  They are not going to make $1B on that drug.  Market cap is already 2B, and there is nothing else there in the pipeline.  Now, Esai could buy them which puts the buyout at $20 or so.  Maybe $25.  VVUS has an ED drug they are trying to sell, so they will have cash…and maybe it will keep the stock somewhat erect for a short period of time…pun intended.

    SNTA/mrm – parabolic rises in penny/small caps scare me big time.  Ride the wave up, but get out b'f catching the wave down is better cause it is a fast and furious one….case and point.  Now, we can start to look at selling puts in the singe dollar range for entries.

  225. Target reached…..Mother of the Almighty…why does the SEC not look into this crap.

  226. Phil – I've just booked the flight for the PSW Vegas meeting.  What was the name of the hotel again that you recommended a few weeks ago?  Thanks!

  227.  msb…msb…msb…no down triple digits on obamacare ruling day…nononononono!
    ACTUALLY: rumor of efsf primary bond buying..just in time to save quarter-end

  228. Well, now I am buying more Aug 125 and Sept 120 puts (SPY).  KMA HFTs…..fundimentals will rule again one day….(maybe?)

  229. That's right Angel, you @ # $ % ^ & *!  

    Health/Rky – We're not an employer obviously but credit unions do it somehow.  I would be happy to have a group formed but no way do I have time to look into such a thing. As to starting our own country – easier to take over an existing one like the top 1% are doing in the US.  

    Good call Pharm – Here sticky, sticky!  

    War/LV – Won't happen again as I now have a "no schmucks" policy.  Also we added those ignore buttons and people got the message.  

    Taking two tablets/Bob – Oh, now I'm confused.  Thought all made in USA.  That's kind of half-assed, no wonder it's not getting press.  

    Spreads/Jrom – I hope you got one.  

    Tax/Angel – I think that's a pretty fine distinction anyway.  Will want to do a bit of reading before having an opinion on that one.  

    Rumor that Merkel canceling a CC is a good thing because (and this does make sense) it explains the total silence from the EU today as they are actually close to working out something major.  

  230. 37% on the ACN inverse collar mentioned earlier today, hoping not to lose it after the bell!

  231. angel – saw it on Bloomberg.  Nein!

  232. Wappler—I think Phil is staying at Caesars—--a number of members  stayed at Vdara

  233. Phil
    Don't give up on those QQQ'S YET.

  234. Holy stick, Batman. 

  235. Let's go, QQQ.

  236. now rumor ecb cuts 50 bps next week
     merkel canceled a presser…so everybody assumes something good as usual  60k eminis taken down supposedly

  237. Redonkulous! What a stick! Non of my spreads filled but that TNA call sure wouldve been nice!
    Angle – Thanks for the recognition but Im just a desk jockey…I man guard towers sometimes but most of the time Im killing people with my excel and ppt skills 14 hours a day! lol. Nothing as dangerous as your nephew did, that is for sure.

  238. This is the one that matters:

  239.  i think the fact that we rally so hard on these types of rumors show investors dont understand the extent of the problems…massive tax hikes throughout the region haven't even hit yet…so whether or not they get bailed out or germany puts its balance sheet on the line…the real economies will continue to weaken after the enthusiasm wears off.

  240. Merkel cancelling press conference in a fit because Italy is winning 2-0 at the Euro 2012 I am sure…

  241. PHil – explanation?  "that matters"?

  242. That's right angel – we have been saying that for a while now. This market is entirely driven by rumors now without any fundamental understanding. China is getting hit, Europe is a basket case and we are getting weaker in the US and yet, these guys will stick the market in the last 30 minutes because Merkel takes a bathroom break and tank the futures at night. I guess it's a good gig if you can profit from it!

  243. VVUS / Pharm – Thanks for confirming. So the plan is to cover the short puts the week before and hope for the best right? If they fail a week later, i persume that the puts will make up for the balance..

  244. zz, lvmoda and angel
    well said re differing opinions……

  245. yes, dpast. Otherwise, we can roll to a vertical and let it go one way or another.  I looked a verticals, but the front month volatility was so high (um, yes I am now aware that we have a reason..and it was not ARNA – well, in part it was), but we can still use the decay to our advantage and then roll out and down to a vertical.  Or take any profits we may have and buy some very cheap puts.  I will outline b'f I do anything, otherwise remind me.

  246.  I'll be interested in stocks again when europe starts deleveraging its banks.

  247. J-sus H!  I walked away for 20 minutes to play the blues over my horrible day and……I'm green!   Almost.  But locked and loaded if Angel puts out tomorrow.  XXX, I know, but if terrapin can say "Holy Stick" :)

  248. Hotel/Wappler – Well I like Caesar's best but if you have Amex Platinum with the fine hotels – they get you way better deals at other places.  Four Seasons was fantastic and my last trip I split 50/50 and I'll be doing that with my kids too as we arrive Thurs at Caesar's and party for 3 nights but Sunday I'll move to 4 Seasons because it's way better for me getting up and getting work done Mon – Weds (I like places where I snap my fingers and get whatever I want quickly and efficiently!)  but it's way down at Mandalay Bay so not too convenient for the main strip action.  

    Qs/Den – Ain't over 'till it's over.  (is it bad that so much of my philosophy comes from Yogi Berra?) 

    Rally/Angel – It also indicates the tendency for the market to fly though.  Being a bear is just too dangerous in this market (not that being a bull is a cake-walk either).  

    Matters/Jerconn – Because this "crisis", in the end, is all about the Financials.  When we had a real crisis, these guys dropped from $20 in July 2008 to $5 in March 2009 – long, relentless sell-offs in the financials with bank after bank falling out of favor.  This is nothing like that – people are buying and people buying financials are often very sophisticated traders with very good models and even better inside information.  As you can see from the VIX – there's no panic here – but there will be if we don't get our bailout.  

    Well, gotta run – I'm wall to wall this week but let's all get some sleep as tomorrow is going to be a biggie.  End of Q, EU meeting, Personal Income/Spending, Chicago PMI and Michigan Sentiment – OH MY!  

  249. "Angela", sorry Angel!!

  250. Look at NKE getting raped AH. Missed results…

  251. ACN beats by $.03, nice pop over 58 about 2.75%, which should drive the inverse collar to a double tomorrow.   Sweet.  Expecting to close the long call at the open tomorrow and watch the short put for more decay.

  252. Rainman: yoga pants
    Just got back in and read your very helpful thoughts on LULU and yoga pants.  not sure it changes my investing premise but researching on you tube always leads me very far astray from my initial search so I trry to avoid it.  I wear my yoga pants more for the support while I'm sitting here working anyway. ;)

  253. Rimm – when trading resumes, should be interesting.  Talk about under promising and under delivering…

  254. …KABOOM!!!

  255. Serious can kicking- 120 billion euros to promote jobs- that extra debt should solve all Europe’s problems- this is quite comical- if it wasn’t so sad it would be funny!

  256. Will have a massive affect on a 15 trillion economy-LOL!

  257. Can't say I am surprised Jthoma

  258. Might want to walk this one back Mitt…

    "As president, Mitt will nominate judges in the mold of Chief Justice Roberts …" -

  259. It looks like the only thing left for RIMM is to be bought out… I guess they have a portfolio of patents worth something but it's getting cheaper by the minute.

  260. Seems like we need to re-think the health of xlf banks and the analogous interdependency of spx components with europe—not enough wight given to that ?

  261. Isle?

  262. Looks like Europe bought 12 S&P points for $120Bn this afternoon – now what?  

  263. In lieu of euro-bonds, I understand Angela Merkel has agreed to present the trophy at Sunday’s Italy-Spain Euro Final. The cup will be filled with Weimar-era deutsch marks as tokens of moral support.

  264. No survivors in the group of death, however two members of the group of debt made it to the final of Euro 2012

  265. Flip—wanted to apologize for the RL stmt —was unwarranted

  266. Hi Friends. Thanks all for the prayers and best wishes. Still in “Motel Hayseed” but have nothing to really complain about other than the terrible Internet access. My loved ones, including pets, are all safe.
    As you’ve probably read, the catastrophe has expanded to over 18,000 acres, with over a thousand firefighters on the job. The fire has been moving in two directions; north and west. To give you some idea of how far it has spread, Monument 13 miles to the north is on pre-evacuation notice, and most of Woodland Park 17 miles to the northwest has been evacuated!

    I think that our neighborhood has been spared, I’ll know for sure soon enough. Apparently there were 347 homes destroyed in the hours after the fire came roaring over the ridge as I described yesterday. There is a community impact meeting tonight, and they’ve asked people with homes on 37 different streets to be there.. At that time they will be going over the status of homes address by address. Grief counsellors will be there on standby. I’m so thankful our street wasn’t on that list.
    I am usually a pretty clear thinker, but I have to tell you it’s been very difficult to think straight under these circumstances.

    Itrade, I hope your folks are well. Sounds like they live very close to me, and the fire line was less than a half mile from my house. If there’s anything I can help them or you with, let me know through this site and we’ll set up some contact info.

    Someone on the site recently said, disasters like this really put into perspective what’s important. To that I say a hearty Amen.

  267. For my conservative friends:
    Dear Friends,

    Even though it's been a few hours now, I'm guessing you're still pinching yourself to make sure you're not dreaming. But yes, it happened. At 10:07 this morning, the conservative Chief Justice of the U.S. Supreme Court, John Roberts, not only joined with the liberal justices to completely uphold almost every single part of the Obama health care law, he wrote the majority opinion himself! In fact, he went even further. When he realized that the government had poorly made its constitutional case to the court, he went searching for a clause in their argument and the constitution that would give him the justification he needed to back the administration and to insure that his decision would hold up legally. In other words, even though he is on the opposite side of the political fence, he wrote the Dems' paper for them. Stunning.

    The other four justices? They didn't just vote to overturn the individual mandate part of the law, they all voted to kill the entire Act.

    The media is already spending much time talking about the mandate being the "centerpiece of the law," but the real news is that if you ever have a pre-existing condition, you cannot now be denied insurance. If you are a young adult without health insurance, you can now stay on your parents' plan until age 26. The insurance company can no longer say there is a lifetime cap to your coverage. The insurance companies are now required to spend 85 cents out of every dollar they take in on actual reimbursement for your health care – not on profit or "administrative costs" (some companies have been taking over a 30% cut; Medicare's total percentage of their budget for administrative costs: 2%).

    I know that our side is not used to victories and so we're not quite sure how to respond when we get one out of the blue. For some of us, the first inclination is to point out just how weak the Obama law actually is, that it doesn't provide true universal health care (26 million will STILL be uninsured), and that it leaves control of the system in the hands of the vultures, otherwise known as the health insurance companies. The individual mandate was a huge gift to the private insurance companies, guaranteeing them billions more from millions of new customers. And many of the key provisions of this law don't even take effect until 2014 – and if the Republicans win in November, you can kiss all of that goodbye.

    So, yes, the bill is highly flawed and somewhat wrong-headed – but what it IS is a huge step in the right direction. And today's court decision cements that. The right wing knows this and they are probably unraveling in some not-so-pretty ways right now. And that's why today is a great day. The Right has been smacked down by one of their own! They know what we all know — that the path of history has been, and will continue to move toward the basic human right that all people are entitled to see a doctor and NOT have to worry about losing their home because they can't afford to pay the medical bills. Those days are over, or will be soon, and that is where civilization is headed. It's not headed back to the days of Oliver Twist. Today's victory is momentum, it's forward motion, and we WILL have true universal health care in this country in the not too distant future.

    So take some time tonight to celebrate; this is a victory for the people. Actually, more than a victory, it is a mandate that all of us must now make sure that a second-term Obama continues to move the ball down the field, toward a system like they have in every other First World country on the planet. He simply has to improve Medicare and then expand it to every citizen in the country. The countries that do this, their people live an average of two to four years longer than we do. Is there a reason anyone doesn't want an extra four years of their lives? Or that our babies would have a better chance of surviving their first year like they do in the 48 countries that have a better infant mortality rate than we do? Exactly who is opposed to this? You'd have to be a bit…crazy.

    And that, I've come to believe, is the true divide in this country. It's not blue state vs red state, liberal vs conservative, Democrat vs Republican. The split we have in America can be boiled down in its simplest form to this: On one side are the people who believe Adam and Eve rode on dinosaurs 6,000 years ago – and then there's everyone else. On that first side are the people who've been fed a diet of fear and lies and hate. And who is feeding them? The 1%. The richest people in the country, the ones who aren't done with us yet because they still don't have enough wealth, have done their best to dumb down the population through destroying our educational system and using media to provide them with a vastly distorted sense of reality. The rich's only obstacle is that they only hold 1% of the votes in the country. So they have to try to get a slim majority of Americans to vote their way. And fear, plus keeping them stupid, usually works.

    So that's the battle ahead of us: Organizing and mobilizing the majority of Americans to push for true universal health care, Medicare for All. At one time, back in Illinois, that was the position held by Barack Obama. He will not make this happen on his own. He will only be able to do it when the mass of American people rise up and demand it. Demand it. Why not start tonight?

    Five years ago this week, my health care documentary, Sicko, opened in theaters across the country. I have spent the better part of the decade on this issue, and for me, personally, fully aware of the current law's limitations, I am very happy with today's news – not because of its specifics or nuances, but because it is a road sign, and that sign points in the correct, humane and sane direction. THAT makes this a great day.


    Michael Moore

    P.S. I will appear on Lawrence O'Donnell's show tonight to discuss this issue – 10:00 pm ET/7:00 PT (replay 1:00 AM ET/10:00 PM PT) on MSNBC.

  268. Thanks for the update jbur! Let us know if you need anything.

  269. Jbur:
    I am glad to hear that you and your family are in good health. In addition, it is nice to hear that your properties may have been spared as well. Have they contained the fire? Do you see any end to the fires in your state? Any threat of rain? Thanks for the update.

  270. JBur / ITrade –  I truly hope everything is okay with you both.  I can't imagine the pain a fire would cause my (little) family.  I hope you're both okay.  Just a quick question, my cousin lives in Elizabeth, CO and I don't *think* he has anything to worry about, but I'm wondering if that is the case.  I tried to look at fire maps, but they might have been old.  Is Elizabeth okay?

  271. DC and Burr: We had a few light sprinkles in parts of town today, but not enough to do anything where the fires are

    The most up to date firemaps I could find are at:
    Just choose “active fires”, then choose Waldo Canyon.

    Burr: Elizabeth is just east of Castle Rock, and is 35 miles north of here. She is not likely in any danger.

    Hey, they are letting some people back into their homes…not us yet.

  272. Futures/Euro jump

  273. Dclark/Waldo Fire/JBur:
    I also live in C.Springs although thankfully east of I-25, north end of the Academy, and well clear of fire danger – at least so far.The fire is apparently 10% contained now but it will be weeks at least until that number gets to 100%. No rain here, though a friend of mine in Breckenridge said they had some good rain. it really is very dry here and unless there is a serious change in the weather pattern, it will be a long and dangerous summer.

    I have a several friends and colleagues who have been (hopefully only) temporarily displaced. Looking on the bright side though, so far no-one has died in the fires. So though it is obviously very traumatic for displaced folks, no-one has been hurt. We are all very thankful for that!

  274. ceegee
    Thank you for the updates. Our prayers are with you and yours, and our neighbors and friends to the west. It is amazing that there have been no fatalities. In my area (near Ann Arbor, Michigan) we had a nasty tornado that did major destruction in Dexter, MI a town located 15 miles SSW from where I reside. The damage was simply unbelievable to area homes and the natural landscape (many large trees); yet, not one death was reported. Funny how that works some time. 
    I saw the map jbur provided and was surprised to see the number of fires that are occurring, or occurred in your neck of the woods. I didn't know that there were so many.

  275. Wow, talk about cutting things to the last moment! 

    Move up in Euro so violent to $1.26 that even EUR/CHF popped to 1.2014.  Don't worry though, World isn't that crazy and back to 1.2010 now.   Pound up to $1.56, Yen getting stronger is odd at 79.27 and the Nikkei flew up to 9,080 but calming down now to 8,980 as Japanese data was pretty poor.  

    Dollar bounced off 82 to 82.18, oil $79.43, gold $1,567, silver $26.85, copper $3.37, Nat gas still lame at $2.74 (but was $2.20 at one point) and gasoline still lame at $2.495.  

    All on plan so far – we'll see what happens when Europe opens:  

    6:00 PM On the hour: S&P -0.19%. 10-yr +0.04%. Euro -0.02% vs. dollar. Crude +0.06% to $78.45. Gold -0.2% to $1552.45.

    8:12 PM Some economic data coming out of Japan today: May jobless rate falls to 4.4%, down from 4.6% in April. Spending by households rose 4.0% from a year earlier, beating an expected 2.3% gain and improving from a 2.6% rise in April. Core consumer price index dips 0.1% Y/Y, in line with forecasts. On a month-on-month basis, the core CPI fell 0.2%. (statistics)

    8:21 PM Japan's industrial production dropped 3.1% in May, worse than the 2.8% fall expected. Car production led the drop, while non-pharmaceutical chemicals also fell. On the upside, a survey included with the data shows manufacturers now expect a 2.7% gain in June output, up from a forecast rise of 2.4% in last month's survey.

    8:29 PM Japanese stocks fall at the open, with the last day of the quarter weighed down by weak manufacturing data. The Nikkei Average dropped 0.7% to 8,816 with blue-chip tech and industrial shares leading: Sony (SNE -2%), Sharp (SHCAY.PK -2.2%), Fanuc (FANUY.PK -1%).

    9:28 PM Stockton makes it official, filing for Chapter 9 bankruptcy protection, the largest U.S. municipality to ever do so. The city lists assets of over $1B and debt of $500M-$1B. Of 42 municipal bankruptcies since 1981, 10 have been filed in the last 4 years.

    9:41 PM South Korea announces $7.4B of fiscal stimulus measures, but officials make clear they're keeping plenty of powder dry in case of further deterioration in Europe. "We now perceive the eurozone crisis as a long-term threat to the South Korean economy," says the finance minister. "We need to store up enough fiscal measures to endure this long journey."

    9:56 PM Working late into the Brussels night, European leaders agree in principle on €120B in stimulus measures (tipped a week ago), says EC President Van Rompuy. Italy's Monti and Spain's Rajoy initially blocked the deal, demanding first that action be taken to lower their countries' interest rates. Thus far, there's no concrete word on anything regarding that. 

    11:28 PM Stock futures and the euro rocket higher ona "breakthrough" in Brussels, where there is agreement, according to EC President Van Rompuy, on a tighter union (i.e., central fiscal authority), and on allowing banks to be recapitalized directly by the rescue funds. S&P 500 +1%, the euro +1.2% to $1.2589

    11:41 PM More on the EU "breakthrough": Leaders agree to create a single supervisory body for banks by year's end as a condition to allow them to be recapitalized directly. Additionally, countries complying with EU budget policies will be able to access EU rescue funds to support their sovereign bond markets. S&P 500 futures +1.3%.

    All very exciting – I'm heading off to bed though – I want to be nice and rested for tomorrow, which should be a lot of fun!  

    So glad to hear our friends in Colorado are all OK – makes it a much nicer day too….

    - Really cool video from the International Space station looking down at Colorado. That 3-point star is Pikes Peak a 14,000ft mountain… the fire is to the right of it and is a long stream of smoke.
    Good news for my parents, the Hunters Point neighborhood is safe… no reports of burn! They are still evacuated since there are still "hot spots" on the ridge/mountain. But the firefighters did a damn good job! That was an ugly scene!
    Thanks for the thoughts everyone!

  277. @Felipe
    While you and many others refuse to accept it, insuring 23 million people is a doable, sensible, and ultimately CONTROLLABLE system.
    Insuring 300,000,000 going to 350,000,000 going to 400,000,000 people is not only not doable, sensible or controllable, it is a rock solid route to national poverty, and insanity, wherein the level of medical care would reduced to that of witch doctors and christian sicientist drivel.
    Can Californica insure and adequately provide decent medical under the same rules of Obamascare? Let's find out with a test case. Can a single payer STATE run system do it ??  You bet.  Can Pennsylvania do it for 6,000,000?? Of course, and they can do it, if they choose, without the fraud, corruption and Big Brother invasions of a National system.
    But Obamascare is impossible to be done without a monstrous increase in taxes, printed money (which may be the real intention of this law) and inflation in the cost of medical care.  The estimates are out and out lies to assuage those without the courage to take a deeper look at implementing good parts of the law, like Pre-existing conditions.  As lons there is no single payer with strict restraints on how much the privare sector can profit, this is doomed to be a national disaster.

  278. Good morning!  

    Europe still fixed but not very exciting so far.  

    3:07 AM Asian markets surge forward, erasing earlier losses, on the EU "breakthrough." Japan +1.5% to 9007. Hong Kong +2.3% to 19460. China +1.2% to 2223. India +2.2% to 17360.

    3:15 AM European markets rocket out of the gate as investors cheerprogress on a tighter union and bank recapitalization. London +1.7%. Paris +3.0%. Frankfurt +2.4%. Madrid +4%. Euro +1.2% to $1.2592. Sterling +1% to $1.5664.

    6:00 AM Overseas: Japan +1.5%. Hong Kong +2.2%. China +1.4%. India +2.4%. London +1.38%. Paris +2.5%. Frankfurt +2.1%.

    6:34 AM U.S. stock futures point higher after an EU growth deal is struck. S&P +1.0%, Dow +0.9%.

    As we expected, only enough money to buy a small pop and it probably won't last but let's enjoy the day and not complain.  

    Dollar 82.83, Euro $1.2571, Pound $1.5589, 79.46 Yen to the Dollar and (drum-roll please), EUR/CHF at $1.2016!  It had spiked up to $1.2024 and damn we should have thought of that as we KNEW they would protect $1.2009 so there risk/reward for playing them up (weaker Franc) was fantastically skewed.   

    Oil $79.88 (congrats to the faithful), gold $1,569, silver $26.81, copper $3.41 (finally progress), nat gas $2.778 after yesterday's big build and gasoline $2.5169 – woo hoo on that one!  

    So, overall commodities kind of lame so no one thinks the EU did enough to fix the World economy so I think we get a day or two vacation at best but then we're back to mainly cash, unfortunately because I can't see risking the July 4th holiday and that pretty much goes for this weekend through next week as Wednesday the markets here are closed.  

    Friday's economic calendar:
    8:30 Personal Income and Outlays
    9:45 Chicago PMI
    9:55 Reuters/UofM Consumer Sentiment 

    Central Banks Commit to Ease as Threat of Lost Decades Rises (Bloomberg)

    Ben Bernanke’s Magical Games (Barron’s)

    Economists Are Overconfident. So Are You (Harvard Business Review)

    Krugman & Layard: A manifesto for economic sense (

    Charting The End Of 'Stock-Picking' Alpha. (graphs)

    Wall Street still ignoring the fiscal cliffMost economists aren't factoring the doomsday scenario into their forecasts. Here we go again. Wall Street has a history of not focusing on bad news until it's too late. Then panic ensues. We might be seeing that pattern again with the so-called fiscal cliff. A recent survey found that 93% of top Wall Street strategists and economists still aren't factoring into their estimates for next year the epic mix of tax increases and spending cuts that are expected to kick in January 1. The question is whether Wall Street is correctly handicapping the fiscal cliff, or just being ignorant.

    German retail sales unexpectedly fell for a second month in May, pulling back 0.3% from the month before. Eurozone uncertainty appears to be "slowing the positive dynamic in the labor market as employers reduce new hires," says one economist. 

    EU Leaders Ease Debt-Crisis Rules for Spain as Merkel RetreatsEuro-area leaders agreed to ease repayment rules for emergency loans to Spanish banks and relax conditions on potential help for Italy as an outflanked German Chancellor Angela Merkel gave in on expanded steps to stem the debt crisis. After 12 hours of talks ending at 4:30 a.m. in Brussels today, leaders of the 17 euro countries dropped the requirement that governments get preferred creditor status on crisis loans to Spain’s blighted banks, European Union President Herman Van Rompuy said. Banks can also be recapitalized directly by bailout funds rather than going through governments, he said. Euro-area leaders also discussed ways to reduce the risk premiums on Italian and Spanish bonds, which have driven concern by economists, investors and Europe’s global partners including the U.S. that the currency union risks coming apart. “There is a whole array of possible interventions and measures,” Luxembourg Prime Minister Jean-Claude Juncker, who heads the group of euro-area finance ministers, told reporters. “It will be a task for the central bank, the eurogroup and the commission and others to pull out the right card at the given time.” With the turmoil in its third year and Europe’s political landscape shifting against Merkel, French President Francois Hollande led a rebellion against Germany’s prescriptions with calls for immediate relief for hard-hit countries. He put French backing of a German-inspired deficit-control treaty on hold, and Italy and Spain withheld approval of a 120 billion-euro ($149 billion) growth-boosting package unless Germany authorized steps to calm their bond markets.

    Juncker Says Euro Leaders Keep All Options Open to Calm Markets. Luxembourg Prime Minister Jean- Claude Juncker, who heads the group of euro-area finance ministers, said euro leaders agreed on “short-term measures” to aid Spain and Italy. “We will keep all options open to make the interventions that need to be done to calm the situation,” Juncker told reporters in Brussels today after the first day of a European Union summit. “We will conclude this in definite tomorrow morning. We made significant progress.”

    Banker to the Bankers Knows the Numbers Are LyingThe Bank for International Settlements, which acts as a bank for the world’s central banks, should know fudged numbers when it sees them. What may come as a surprise is how openly it has been discussing the problem of bogus balance sheets at large financial companies. “The financial sector needs to recognize losses and recapitalize,” the Basel, Switzerland-based institution said in its latest annual report, released this week. “As we have urged in previous reports, banks must adjust balance sheets to accurately reflect the value of assets.” The implication is that many banks are showing inaccurate numbers now.

    Yields on 10-year Spanish bonds plunge 31 bps to 6.63% after touching 7% yesterday and those of Italy dive 22 bps to 5.98% following the EU summit breakthrough. Shares in Madrid are +2.5%as banks have a party, with BBVA (BBVA+5.5%, Banco Santander (SAN+3.6%, and CaixaBank (CAIXY.PK) +2%. Milan stocks are+2.6% 

    Ireland's Second Bailout Looms With No Bank Accord: Euro Credit. Ireland's borrowing costs may signal the government is being drawn into needing a second bailout as the country struggles to cope with the legacy of the euro region's worst banking crisis to date. Irish October 2020 bonds, regarded as the benchmark, yielded 7.13 percent yesterday, less than a percentage point shy of the level that pushed the state into an international rescue in 2010. "At this point, a second bailout for Ireland is the most plausible option," Chris Johns, who manages about $7 billion at State Street Global Advisors in Dublin, said in an interview. "One of the main reasons Ireland can't go back to markets is that investors have significant concerns about our solvency and that's down in part to banking debt."

    India is likely to face elevated inflation risks from supply bottlenecks and lingering threats to economic expansion, the Reserve Bank of India said in its Financial Stability Report. India’s financial system "remains robust," but challenges to stability have increased since the last assessment in Dec. 2011.

    Chinese Industrial Companies’ Profits Drop for Second MonthChinese industrial companies’ profits fell for a second month in May, a government report showed today, as slowing economic growth hurt corporate earnings. Income dropped 5.3 percent from a year earlier to 390.9 billion yuan ($61 billion), the National Bureau of Statistics said on its website today. That compares with a 2.2 percent decline in April and 4.5 percent gain in March. The deterioration adds to signs that government measures to stimulate the world’s second-biggest economy have yet to reverse a slowdown that may deepen for a sixth quarter.

    SocGen Expects Chinese PMI To Fall Again.

    In a Shift, Chinese Exporters Cling to DollarsMany Chinese exporters are starting to hoard the dollars they earn, betting that the yuan is unlikely to appreciate much more, a shift in strategy that is having a ripple effect throughout the country's financial system.

    With the fallout from Libor scandal gaining momentum, The British Bankers' Association yesterday asked the U.K. government to intervene in the regulation of the rate's "setting mechanism." One option is for the FSA and the BOE to become more directly involved, with the WSJ reporting that regulators would sit on a new supervisory committee.

    FHA Underestimates Mortgage Delinquency Rates, Study SaysMore than 40 percent of the U.S. Federal Housing Administration loans originated from 2007 through 2009 will be delinquent within five years and the agency’s data underestimate that risk, according to a study by the Federal Reserve Bank of New York and New York University. “Having such a very large fraction of the people who borrow from you become delinquent could never be regarded as good public policy,” said Andrew Caplin, a professor of economics at New York University and one of the study’s authors.

    Mortgage Seizure Plan Sparks AllianceBernstein Talks With County. Bondholders including Angelo Gordon & Co. and AllianceBernstein LP heard from a California county’s top executive amid mounting concern it will use eminent domain to seize mortgages packaged into securities to aid homeowners who owe more than the properties’ values. The Association of Mortgage Investors organized a conference call on June 27 with San Bernardino County Chief Executive Officer Greg Devereaux, said Chris Katopis, the Washington-based group’s executive director. Staff and members of other trade organizations were also invited to participate, he said, amid speculation the unprecedented strategy may serve as a template for other areas.

    Eminent Domain Is Bad Ploy for Underwater MortgagesOfficials in San Bernardino County, California, believe they have figured out a clever way to solve the county’s, and possibly the nation’s, housing problems. Detailed by a Cornell University professor, and pitched by influential San Francisco investors who stand to make a fortune from it, this new idea is based on one of the oldest concepts: the taking of other people’s property. County officials, joined by the cities of Ontario and Fontana, are considering using an expansive interpretation of eminent domain — typically used to acquire real property to build public works — to seize the mortgages, not the real property, of those homeowners who owe more than their homes are worth. The funds would be provided by private investors, who would pay the holders of the mortgages “fair market value” and then write new ones for the homeowners based on much lower principal amounts, reflecting the new depressed values of the homes. The firm behind this complex plan, Mortgage Resolution Partners, may be in the running to acquire vast numbers of mortgages at discounted rates.

    I've been saying this for a year:  Demand for Auto-Loan Bonds May Hurt Credit Quality, Moody’s SaysHeightened competition in the subprime automobile-lending market may result in large investor losses if growing demand weakens underwriting standards, according to Moody’s Investors Service. The market has grown over the past two years as private equity firms, including Blackstone Group LP and Perella Weinberg Partners LP, are drawn to the sector’s profitability, Moody’s analysts including Peter McNally wrote today in a report. That recent influx of capital echoes trends that led to a lending bubble and heavy losses in the 1990s, signaling a similar downturn may be repeated if competition for attractive returns deteriorates the credit quality of portfolios.

    Ford Motor(F), Citing Europe’s Woes, Says Foreign Losses to Triple in Quarter. Europe’s economic woes are taking a much bigger bite out of the profits of Ford Motor, which until now has largely avoided the hefty losses that have dragged down the profits of many of its rivals. The company said on Thursday that its total international losses would triple in the second quarter, with Europe accounting for the most of the loss. 

    Citigroup removes Ford (F) from its Top Picks Live list after the automaker warns of global losses. After initially surviving weakness in the European auto market better than rivals, Ford now faces the same tough choices on downsizing on the continent. F-0.9% premarket.

    ObamaCare's 7 Tax Hikes On Under $250,000-A-Year Earners.

    Roberts Chooses Restraint Over History on Obamacare (Bloomberg)

    Romney’s Dilemma (New Yorker)

    BILL O'REILLY: 'Now The Government Calls The Shots'.

    Las Vegas Sands (LVS) CEO Sheldon Adelson has been accused of approving a "prostitution strategy" at the casino operator's properties in Macau. The allegations were made in a court filing by Steve Jacobs, a former top China exec who is suing LVS for wrongful dismissal. Jacobs' latest allegation adds to other accusations of wrongdoing.

    Citigroup defends Buy-rated Nike (NKE) after its FQ4showed a worse-than-expected profit on higher spending and increased material costs. Analysts clip their price target to $98 from $123, but maintain that the long-term thesis on Nike as a high quality growth story remains intact. NKE -12.1% premarket. 

    Shoe sellers are on watch today to see if investors sell off the names on the same margin concerns stirred up by Nike's FQ4 earnings report. Premarket: SHOO -0.2%CROX -0.5%DECK-1.1%SKX inactive.

    RIM(RIMM) Reports Loss as It Cuts Jobs, Delays BlackBerry 10Research In Motion Ltd., losing ground to Apple Inc. (AAPL) and Google Inc. (GOOG), said it will delay the BlackBerry 10 phone release, cut 5,000 jobs and posted a quarterly loss that was five times bigger than projected. The stock plunged 22 percent after the company reported a first-quarter loss of 37 cents a share, excluding some items. Analysts had estimated a 7 cent loss, according to data compiled by Bloomberg. Sales tumbled 43 percent to $2.8 billion, missing an estimate of $3.05 billion.

    The SEC may demand that Nasdaq (NDAQupgrade its trading systems following Facebook's botched IPO, sources say. A forced upgrade could be both embarrassing and costly for Nasdaq.

    Apple Said to Prepare iTunes Changes to Improve Sharing (Bloomberg)

    Physics blogs hint that long-sought Higgs boson is in sight  (LA Times)

    How Anonymous Picks Targets, Launches Attacks, and Takes Powerful Organizations Down (Wired)

    54 Smart Thinkers Everyone Should Follow On Twitter (Business Insider)

  279. Doomed/Flips – How come the rest of the World can do it and America can't?  How come Medicaid runs with a 1.5% overhead while we have to mandate insurance companies cut back from the low 30s to 20%?  You say this over and over again but it's DEAD WRONG – the problem with medical care in this country is it's run for a profit and every single person along the way has their hand out to take MORE money from the consumer – who is generally FORCED to buy their products and is in no position to negotiate.  No one has an interest in lowering costs – not even the insurance companies because those rising costs justify their fee increases and it's simply a matter of milking the consumer for every penny of disposable income they have.  Why do you think both energy cost and health care consume 17% of the GDP?  Because that's around the max the consumers can afford so, like an evil Coke and Pepsi, they battle it out within the total market share that's possible for every spare consumer Dollar.  This is a BROKEN system – stop defending it!  

  280. "the problem with medical care in this country is it's run for a profit and every single person along the way has their hand out to take MORE money from the consumer …"
    You keep saying that you are not a black and white kind of guy.  Yet, when you see my opposition to the changes proposed by Obamascare, you automatically assume that I am defending the current system in the Divided States of America.  I am among the majority in case you missed it who have always been in favor of aspects of health insurance that are in the law, and simply make sense, like portability, pre-existing conditions, and going piecemeal at changing the doable, sensible and damn the cost of it.
    When I tweak one aspect of a System, I am inadvertently affecting something else in the system. THAT's what Obamascare is doing. And lying thru their teeth to do so.  This isn't about health care at all it's like the gay marriage thing wherein it's not about making it a constitutional right to make marriage between non-procreators it's ultimately about grabbing more power, a game for a buncha out of control egomaniacs.
    I will say it till i die: You cannot Insure 400,000,000 people without placing a levy so onerous on the productive class that the entire system collapses.  Or to print money to fill in the shortfall and that will be in the trillions in country that is already drowning.
    You can point to all the countries you want but there is NO COUNTRY the size and scope and diversity anywhere in the world offering health care to 350,000,000 ++++ people. Why you repeat that Europe can do it when Europe is not a country smacks of hype and disingenuousness on what is really going on with EACH country offering socialized medicine, which, I have said countless times can also be done here on the Continental united states, Hawaii and Alaska: EACH enttiy whether it be regional, state-run or other vitrual combination can properly administer a health care systen, while a nation of our size could NEVER do it, and the attempt to do it will only result in catastrophe in tne long run.
    One hopes that more rational beings will adopt the good parts of the law piecemeal. But without cost controls all along the line, and adequate medical professionals and aides (already too few) to carry it out, this is doomed. Whether you defend it or not.
    I repeat: I am a victim of this system and have no dog in the hunt to defend it. It must be changed. This is not the way to do it.

  281. Allegiance to the dogma of the left on the health care issue is clearly the prerequisite on this site. People can't afford health insurance, so we have to give it to them. Paid for by somebody else. Never mind that the health care system is riddled with inefficiencies and senseless costs. It costs too much for regular folks, so we must give it to them.
    Does that pretty much sum it all up?
    As I said, I worked in the financial end of the health care industry for most of my adult life, and I am absolutely no friend of the insurance companies. In fact, one of my objections to the ACA is the fact that it gives them much more power and a terrific business opportunity. I suppose Phil and I might be able to agree on that, except this is a liberal bill, and therefore, it does exactly what is needed, right?

    It used to be true that government insurance was much harder to understand and to get reimbursement from. Gradually, that changed. Government insurance is not easier to understand nor deal with, but private insurance has become a goddamn nightmare. I now lean toward single payor for that reason.
    If this law really stands, I would buy health insurance stocks (they are becoming quite a bit cheaper) because I have faith in the industry's ability to sidestep restrictions in the law and invent new ways to squeeze a profit from their activities. I have watched it for years, and their power to make money is awesome.
    It remains true that health insurance is required because if you don't have it, the bills you are presented are hideous overcharges, and nobody can expect to pay at least some of them. Hospitals charge 15 times what something ought to cost, then write off 90% of it, to net a bit more than insurance would have paid them. As flips said, The system must be changed, but this is not the way to do it.

  282. Productive class/Flips – Ah, there's your problem!  Only 135M people in this country work – of course they will have a burden put on them to support the 165M who don't and, down the road – only 100M will work to support 200M who don't and then it will be 50/250 and 10/290 one day.  The "productive class" is getting paid more money (not enough more for the bottom 90%) because we become more and more efficient, so it takes less people to produce the same amount of goods and services and if we shove any more goods and services down the throats of the average bloated American – they are likely to explode so we end up decreasing the number of jobs and we CREATE a larger leisure class.  

    Rationally, that's a good thing.  How nice that 2/3 of our population does not need to work.  The only problem is that selfish jackasses who do have jobs and benefit from all that productivity can't stand the fact that they work while others are supported by and for the general welfare.  If you think the poor have it so good in this country – go be one of them!  You can't stand on your BS moral high ground and call yourself the "productive class" – as if you are somehow better than they are because you won the genetic lottery and got some breaks in life and made some money.   These are human beings – just like you – and they deserve the same care and respect that you do and it's true NATIONALLY – it's not something that should be left to individual states (like Texas) to decide.  

    EUROPE has the size and diversity of the US, CHINA has the size and diversity of the US, INDIA has the size and diversity of the US – this is another silly point you constantly try to win with.  We are one of the biggest countries on Earth but that doesn't invalidate any comparison nor does it somehow "prove" any of your points since being bigger does not mean things smaller countries do can't work or why don't we give up on electricity, water management, the CDC, Social Security, the Army (each state should have their own?).   What a ridiculous measuring stick to base your arguments on….

    "Don't do it, it will end in catastrophe" has been the battle cry of small-minded people who have stood in the way of human progress for thousands of years – so I'm not too impressed with your rationale there.   You may get your wish – the Republican Governors have vowed to defy the court and will not cooperate on National Health Care.  I love it – the Reps have chosen to be the anti health care party and they think this is the issue that will win them the election.  That is just TFF….

  283. Flips/Healthcare

    But any healthcare system is essentially local. Britain provides healthcare to about 60 million  people. Is there really any difference between 60 million and 400 million, except that more units of health care are to be provided?

    Obviously it needs to be broken down geographically. For example for any given population and geographical area, it is possible to calculate roughly how many births are expected. From this can be calculated the number of maternity beds necessary in peak birthing months within a certain travel distance of a certain percentage of the population, and also things like the number of obstetricians that need to be trained, midwives, ultrasound machines, painkiller dispensing machines, rubber gloves, and so on to serve a distinct population over a given period of time.
    If you have too many beds, too many obstetricians, then it gets too expensive, and if you have too few, then successful outcomes will probably decline.What is needed is balance, which cannot really be achieved without all the stakeholders working together.
    The other factor that then needs to be added in is portability. If all populations are provided for, then a woman who is provided for in Alaska numbers should be able to to receive services in Florida, if need be, on the assumption that a reciprocal agreement will level things out in the long run.
    If Britain and Australia can have reciprocal agreements for their citizens to receive health care, then surely the constituent parts of the US can also do so.
    So all that is needed is to provide healthcare for one geographically distinct are, then duplicate elsewhere. You can see the same thing with fast food restaurant chains which are about the same wherever you go and may even use the same architectural drawings to build restaurants in different climate zones.

  284. Change/Barf – As I have said (and Michael Moore says it better above) – it's a start.  This is what we could pass (barely) so far.  The entire overhaul will take decades of winning battle after battle to get rid of the Health Care Cartel and their political puppets.  

  285. The Flip/Phil exchange is an important one.  I am devastatingly ignorant of the subject, and cannot judge.  I can repeat what I wrote yesterday — that near-70% of health care costs are from self-abuse / bad practices related to tobacco, alcohol and obesity.  I've not seen studies on the abuse of illegally obtained prescription drugs, but somehow, over the last ten years, a phone call "interview" with a "doctor" will get you hundreds of Vicodins/Percocets/hillbilly heroin delivered to your door.  No health care systems tasked with "fixing" a population hellbent on chemical or biological suicide, without discrimination or restraint, is likely to succeed unless those people create enough income to cover their own costs, which, apparently, they cannot.  
     In 2004, the national bill for hip and knee replacements was $26 billion. [], a number that is skyrocketing as obese baby boomers age. Any public health care system that in effect subsidizes this abuse, or its consequences, cannot succeed.  Phil is correct in pointing out that the health care industry is dining out on the profits from these billions, and that is surely something that should change.  But a health care system tasked with restoring health to a population without any disincentive for self-abuse must, one would imagine, end in bankruptcy.  

  286. Flips,

    I read your piece on healthcare and It seems to me that a system scaled for 400 million could bring better medicine to all at no per capita cost increase over a system serving 40 million. For one thing it would be easier to have a nationwide message about better health habits rather than 50 programs coming from the state level, and I think teaching healthier habits is one key to lowering health costs.

    What are your ideas for changing our system so as to provide healthcare for all?


  287. this is a business/money blog…….supply /demand………how do you add 50 million to demand with no increase in supply and not expect quality to go down…….
    and how come the supporters of the bill except howard dean never mention that the "evil" lawyers werent touched by tort reform. 
    the consensus says you cant have health care reform with addressing the supply demand equation and tort reform..
    there is a reason the people in canada come to the u.s. in critical situations……..
    and to hold up europe with what all has been going on is not necessarily the optimum solution
    like rodney king said we can disagree but lets all get along …….the disagree part is mine …….
    have a good day…

  288. I agree with that ZZ.  The UK system rewards doctors for improving their patients' health habits and it's been very successful.  Of course, in the US – you are up against the tobacco lobby and the soda lobby etc (look at Bloomberg fighting them all off) and, in the end, since the care is reciprocal state to state (good point by Barf), you MUST have a National policy on Heath Care and that should, ultimately, include legislation that restricts or penalizes poor behavior.

    Still, it's one step at a time because we can't even get people to agree there's a problem so far.   Have you seen "The Weight of the Nation"?  Nasty stuff….

  289. zerox/self abuse

    Well, every case has to be considered on its own merits. In the UK primary physicians are incentivized to get a certain percentage of their patient list enrolled in weight loss or alcoholism programs, and some services may be withheld from the obese, for example in vitro fertilization or knee relplacements,  until they lose some weight..
    Inevitably there is an element of rationing  as expensive procedures go first to those who are most likely to benefit. For example a man with a good job and five young children is more likely to go to the head of the list for a kidney transplant than a 90-year-old homosexual with a young lover.
    But this is what democracy is all about--the collective will making decisions about how to distribute resources. There is a huge fallacy going around in the US to the effect that human beings are economically independent of each other and of the society they live in,  which is obviously untrue but accepted because people are brainwashed by the educational and media propaganda machine so they cannot think for themselves.

  290. Healthcare, one comment before the bell:
    As an entrepeneur  for almost 30 years and has paid for my own health insurance for that entire time I almost gag every time I hear someone in politics say the greatest impediments to innovation are taxes and regulations.  False, it is the health insurance handcuffs that keep innnovative people tied to their corporate jobs because it is so costly or impossible (re pre-existing condidtions) to keep theirs families covered during those frightful first years of any new business.

  291. My question is why don't the same people bitching about govt. healthcare and it's costs, ever talk about the billions and trillions spent on the military industrial complex and the lives lost fighting bullsh*t wars?
    I know one reason. It's easier to complain about additional taxes they will pay and then justify these wars, lives and costs, as of price of freedom.
    I'm certain, most of those who complain, have their VA, retirement, or job health plan and don't know what it's like to go without…..

  292. jmm1951/8:24am
    Great comment. Too bad many cannot think for themselves…..

  293. 1020 – No, a massive "jobs" program.  It is the equivalent of paying people to digs holes and fill them back up, and has probably been useful over the five years of recession in that regard. Although blowing stuff up and killing people in other countries under dubious premises seems less productive that spending the money on bridges and tunnels.  There are probably economic benefits to being seen as a militarily strong country, but having a military larger than all other countries combined makes no sense at all, starves more productive areas of investment, and is more of a giant vampire squid in that regard than all of our corrupt financial institutions combined.  

  294. "..Still it's one step at a time.."
    Precisely.  You argue with me and slam me and yet you say the same thing I do!!
    And Obamascare IS EMPHATICALLY NOT one step at a time. You're hyocrisy or outright lying is marvel to behold so entrenched in your hatred for all things not democratic party related.
    You are the personification of,  "You say I contradict myself.  Well then I contradict myself, I contain multitudes".


  295. Wow Flips – seriously?  Do you only see everything in black and white absolutes?  What do you do at a yellow light – those must really piss you off….

  296. No Phil, you do. What you constantly accuse everyone else who disagrees with your rabid lefty polittics of doing.
    It's either the democratic party or nothing. No matter what, the so-called lesser of two evils.
    I always run the yellow light, unless there is a vehicle coming prependicular to me. That's about as grey as one can get.
    The piecemeal approach, had it been done when Hillary tried to abuse her power, by making it all but impossible to vote for (wonder why).
    By now, portrability would have been in place for ten years, pre-existing conditions would be in place for at least 8 years, mandatory insurance with some teeth in it instead of some penny ante tax/penalty would be in place as well.  Little by little national changes could have already been implemented and many more would be insured, but no. 
    Because like you, this isn't at all about health insurance, it's about— and you're about— only one thing:  Installing democrats as the de facto single power in this country and world. The hell with two party or parliamentary systems, you are a closet fascist.  Or king.

  297. I do get a little irritated at the flashing yellows…. ;)

  298. "…you are a closet fascist.  Or king"
    Which works very very well on this Options trading, site wouldn't have it any other way.
    But politically, it's more than radical.

  299. flips—I would think you would know by now!!!