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Wednesday Ramblings – Things that Make You go Hmmmm…

We had an interesting Chat session this morning so I think I'll share.  

As it's sort of the anniversary of the big crash, we were discussing my historic bottom call when I was on TV doing LiveStock with Tim Sykes that afternoon and we ended up making 13 bullish calls that were up 469% AVERAGE just 6 months later.  Not that it took a genius to pick the stocks (GE, DIS, XLF, AMZN…), that was like fishing in a barrel using a nuke – everything was going to go up – the real trick is pulling the trigger – that's the hard part.  

It doesn't happen very often but this is why we like to stay around half cash in our main portfolios – you never know when a huge opportunity will present itself.  It's also why it's so valuable to have those downside hedges. 

Like currently, we have just 50 DIA puts as a hedge in our Income Portfolio but that's because it's new and it's well-hedged and we are mostly in cash and we don't have a lot of profits to protect at the moment and, if the market begins to crash – we'd be happy to take small losses and get back to cash or DD into better positions (as we initiate 1/4 positions in general anyway).  But, back in Jan of 2008, we were at the top of a massive run and back then, in that Long-Term Portfolio, we had 250 DIA puts protecting our positions.  We had started with 50 DIA puts but the market kept going up so we rolled them and doubled them and rolled them and doubled them and THEN there was a big crash and the puts saved our assets.  

That post evolved into "How to Solve the Housing Crisis Tomorrow" on April 16th of 2008 so yes, we at Philstockworld considered it a crisis long before the MSM did.  In fact, I sold my real estate data business at the end of 2004 – that's how early I called it!  Anyway, a year later, still nothing was done and I wrote "For Timmy G: How to Solve the Housing Crisis TOMORROW" and props to Mr. G for inviting me and a few other bloggers to meet in Washington where, as noted by Steve Walman:  

Phil Davis, who made clear that his remarks were from the perspective of bank investors, thought Treasury was doing far too little to defuse the housing problem. He pointed out that even if the financial reform bill is beautifully crafted, its full implementation will take up to three years, during which the banking system will remain in peril, largely because of tenuous mortgages. 

Sadly, this all came up because, 4 years later now, we are STILL discussing tenuous mortgages as an underlying economic problem.  In fact, we have now added tenuous student loans ($1Tn an counting) to the mix because the college costs that used to be paid for by refinancing a home are now burdens placed on the students at much higher rates.  As usual, the banks win and we all lose.  In answering a Member's comment as to what can be done to help homeowners (other than low rates), I said:

Think about what's happening, they are telling people who have $400,000 6% loans that they don't qualify for $400,000 3.5% loans – even if they are making their current payments.  If the Government simply fixed that – this economy would take off like a rocket.  The banks are able to quickly refinance at low rates but not their customers.  Also, of course, there are all sorts of nonsense charges involved when refinancing.  You need title insurance again, which is ridiculous and they usually do appraisals, also ridiculous and then they charge you application/origination fees, etc.  All BS charged to the consumer and enough money that it prevents the most needy from going through the process that they desperately need to save them money.

One stroke of a pen and the Government can force banks who want to borrow for 0.25% to ADJUST EXISTING LOANS to 3.5%, with no fees and no searches – there is no reason other than corporate greed for banks not to pass along those savings to consumers – savings that those same consumers are going into National Debt for to provide subsidized rates to those very same bankers.  

Madness, right?  Anyway, we had a great time yesterday shorting oil at $93 and $93.50 (and I mentioned right in the morning post, so don't complain that we only give good trade ideas to our Members) and again this morning, we caught another ride down from $93 to $92.50 in Member Chat.  At $500 per .50 move per contract – we can afford coffee with our Egg McMuffins this morning!

We also went long on Silver (/SI) at $29.05 and caught a very nice pop to $29.19 and, while that doesn't sound like much, silver contracts pay a whopping $50 per penny (margins are a bitch at $10,450 per contract) so a nice $700 pop there with an obvious stop at $500 and a reload on the next cross over $29.15 would be the way to play it.  

We could also flip long on oil (/CL) at $92.50 until it breaks and it's almost certain to climb ahead of inventories at 10:30, where we expect to go short again (and see yesterday's post for USO and SCO ideas for you non-futures players).  As you can see from the chart on the left (thanks StJ), we're very confident in our long-term bearish view on oil and, while it may drag the energy sector (and the market) down in the short run – in the long run, $70 oil would be fantastic for a recovery.  As I noted to our Members:

Note how they refuse to project further drops, which makes no sense as CAFE standards alone raise the fleet to 35mpg (from current 22) by 2020 and 54.5 (no, I am not kidding) by 2025.  So tell me, how does that chart stay flat if the same cars that were getting 22mpg in 2012 are getting 54.5 in 2025.  Also, what about other possible improvements in the use of solar or Bill Gate's fusion project or something?  That's why I love the long-term short on XOM – they are a lot deader than AAPL in the long run.  

I cannot stress enough what a great trade bearish on oil is likely to be today.  As I said yesterday and as I said at $103 last year: If the NYMEX crooks are stupid enough to pretend to want oil delivered to them at $93 per barrel in April, we are more than happy to take their money and promise to deliver it to them.  Oil is up $2 from last week, when we had a build in inventories and traders are looking for a draw this week as imports have once again been cut back to create artificial shortages and refiners have been working overtime to blend non-ethanol gasoline before the regs kick in to use less oil in making gas (more expensive for them) so the conditions are primed for a drawdown in crude this morning but, after that, then what?

So don't be fooled by a headline draw in crude today if it is offset by a build in gasoline stockpiles as that will simply indicate that more oil was converted to gas this week than last – it has nothing to do with demand which, contrary to populist opinion – still does matter when pricing commodities.  What also matters in pricing commodities is the Dollar that they are priced in and the Dollar seems to be topping out at 83 and we're calling below 82.75 bullish and that means we would not want to be shorting commodities (or anything else) if the Dollar is dropping.  Meanwhile, oil did just touch $93 again (8:15) and that's still a shorting line (and a nice $500 gain since we went long at $92.50) – who needs to get paid to write posts when the futures market acts like a free ATM?

That's why I want to retire to Europe, I'd be writing this at lunch-time and making my Futures trades to pay for my lunch (and the rent) each morning and then the rest of the day I'd take off.  As we noted last week, statistics show that, for the average trader, trying to time the market is a complete waste of time anyway so better to just take the hit and run trades and be in cash at the end of each session while leaving long-term money in simple SPX funds.  In fact, for example, you can just sell the SPX Jan 1,200 puts for $15.50 and the margin on each $1,550 collected per contract is $11,975 (according to TOS in ordinary account) and that's a 12.9% in 10 months as long as the S&P holds 1,200 (now 1,550) so you have a 20% cushion to make your 12.9%.  

How is that riskier than putting your money into individual stocks?  If you combine that with a few clever hedges along the way, maybe you only make 9-10% but that still beats the returns of 9 out of 10 traders and look how relaxing it is!  If you combine that with a very basic money-management strategy and scale in (see our Strategy Section) and roll on the dips, you can probably stay out of trouble all the way to S&P 900 – can you say the same for the stocks you pick? 

Warren Buffett ImageAnd one last point on rolling.  People say, what good is it if the market drops to 1,000 and I have to roll and I only break even?  This is a major problem many investors have in visualizing a strategy but, as March 2009 taught us, the trick in a market crash is simply TO HAVE MONEY TO INVEST – it doesn't matter if you are "only" even or (and I know this is confusing) even "only" lose 20% when the market drops 50% – the point is you have 80%+ of your money and you can buy stocks for 1/2 the price or less – so you can buy a lot more shares than you could have before in the exact same companies (who have already proved they can survive the crash, which was our heavy XLF logic in '09).  Of course, using options like we did, you can turn 80% into 400% on the recovery – so how do you feel about those S&P short puts now?  No wonder Warren Buffett sold $5Bn worth of them!

AAPL Revenue TTM ChartNow, since I'm rambling this morning (and Retail Sales are up huge so FU bears!), let's just mention AAPL and the very good article by John Tobey at SeekingAlpha reviewing all sorts of TA and FA on my favorite company.  One thing that struck me is a chart he used to "demonstrate" AAPL's "stagnation" as they hit the "notorious S curve" in tech (left).  As noted by John (and I'm not criticizing, the article is great):

By examining the following graphs, we see a maturing company, with declining growth rates in both sales and earnings. While the profit margins are still within the historic range, they are in a period of decline. Why? There have been a number of developments such as keeping the iPhone 4 and 4S products in the lineup at reduced prices or the widespread discounting of iTunes gift cards during the holiday season. This chipping away at prices adversely affects Apple's two key measures: Sales growth and Earnings growth.

BUT (and this is a really BIG BUT), you could have said the exact same thing in 2009, when the same chart looked even worse:

As with most things – it's all a matter of perspective.  Same words in a different situation can convey a very different impression (like my favorite version of Baby Got Back).  AAPL sure had back at $85 in 2009 and I'm not going to get into the fact that I feel the same now about it as I did when I was pounding the table at $85 at the time for most of the same reasons.  Same song, different tune.

At this particular moment, AAPL is mainly down on fears that the new Samsung phone will be the nail in the "coffin" of the IPhone.  I think they said the same thing about the iMac for the last 15 years although, ironically, AAPL may have finally killed the growth of the iMac (and the rest of the PC/laptop sector) with the IPad and NO ONE is seriously challenging AAPL's iPad(s) so far.  As to phones – as AAPL will demonstrate in the near future – phones are so 2012…

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  1. Oil Lines

    R3 – 95.47
    R2 – 94.47
    R1 – 93.60
    PP – 92.60
    S1 – 91.73
    S2 – 90.73
    S3 – 89.86

    Yesterday's high and low – 93.47 / 91.60

  2. Demand destruction / Phil – I guess looking at the 2004 prediction as a guideline and where we are with the 2013 predictions, you can then see where the 2020 predictions will be… These guys seem to be just as good as the economists when it comes to predictions….

  3. And eeeeeeeeehw  (reverse-wheeeeeeeeee) on better than expected retail sales! So much for a bad February from these Wal-Mart emails!

    Although apparently AAPL sales were not that good as they are still called lower in pre-market   ;-)

  4. Good morning!  

    Big upside surprise in Retail Sales – US Consumer Not Dead Yet!  

     Feb. Retail Sales+1.1% vs. +0.5% expected, +0.2% prior (revised). Ex-auto +1.0% vs +0.6% expected, +0.4% prior (revised).

    With good retail numbers, not a good idea to short this $93 level on oil – it may break higher from here into inventories and then we'll have to see how it shakes out (10:30). 

  5. Even though AAPL lower this morning it is still holding the demand level I mentioned yesterday.  the weekly low is 425.14…unless it breaks that with conviction (and not a spike down just to flush out the stops) it is still a good sign in my opinion.  If it does break I am eyeing the next level of 2011 year end # of $405 (gap fill $410-$400 zone). Phil, your thoughts?

  6. Good Morning!

  7. AAPL / Dawn – On an hourly chart of the recent slide, I have the following lines:

    This look pretty reasonable. On the downside, I have the next line around 402 and then 380 (gulp)… But that goes with what I was saying yesterday, we need to break 435 on the upside (not some rumor boosted spike like Monday) and then 444! Not there yet.

  8. Impressive morning Phil! – new tea?

  9. Just got filled on USO $.79 Thank you!
    AAPl--Was listening recently to some hedge fund managers that I do respect and they are eyeing $350 as an eventuality.
    Not gonna wrestle with the TA pig anymore…already muddy enough ;-)
    Thanks STJ we are aligned on chart

  10. Better than yesterday but we need FAS to come down 5 more points!

  11. FAZ / Phil – From yesterday, entered at 0.85
    Playing /CL in Paper trading, stopped out at 93 twice and once at 93.25.  Looks like they are trying to get /CL to 93.50.  Trying to learn how to play this.  Another 1000 hrs to go!

  12. Nice recovery with GMCR!

  13. Phil
    Looks like AKAM has found a bottom. Would you DD or roll out further.

  14. New Tea/1020 – I was up extra early and decided to take a break and not try to have a theme for the day.  It's actually pretty relaxing for me to just type whatever pops into my head without the "effort" of turning it into a "story" or whatever.  You guys are used to me rambling but the reading public is likely to be confused by the jumping around but F them as I was mostly watching the Futures (silver $29.25!) and having fun.  

    Predictions/StJ – If only they were worth the paper they are printed on – we would all be paper Barons!  

    So Retail Sales rammed the Dollar over 83 (more demand for Dollars to buy stuff) and now BCS raised their GDP prediction from 1.9% to 2.2% – that's a 15% bump but the rising Dollar is going to knock things back.

    Oil managed to run to $93.40 before falling back and now $93.33 and a fun but dangerous short ahead of inventories.  Just make sure you have tight stops and you can play those .25 crosses bearish as long as the Dollar is rising. 

    Thoughts/Dawn – See above or see my original call on AAPL from Jan where I said they could fall to $400 "but so what?"  That's the key if you are playing the long game.  

    Oops, getting slammed back already as Dollar pops to 83.25 – over that is bad but hopefully we hold yesterday's lows and prove we still have legs.  

    $29.15 is back on silver but not a good bull play with the Dollar rising but, on the other hand, when the Dollar starts coming back down, this thing could blast again so hopefully we re-test $29 for a safer entry. 

  15. dawnr
    Did they say why, or is this just what they want it to do? Bit of sarcasm in my writing, but it just seems like when they have some stock in their grips (like AAPL) they can pretty much make it do whatever they want. If you look at the articles posted about AAPL (for instance on Yahoo) it is 3-1 negative. If you didn't know a thing you wouldn't touch AAPL today. So, if they want $350, I guess they will find a way to get it there.

  16. Phil – I had a note to stop the AAPL Apr 430 Puts at $17.

    Incidentally, I ran a margin analysis of the portfolio last might and it's getting pretty aggressive even in a PM portfolio. Upward of $300K.

  17. aargh  wasted half anhour figuring out damned pc was trying to boot off an ipod

  18. Good job on USO Dawn, way to stand your ground.  

    Oil/Jfaw – Gotta watch a lot of things, not just the price of oil.  You should keep charts of the Dollar, Gold, Euro, gasoline, nat gas, USO, XOM, VLO, OIH and XLE handy when playing oil and get used to the rhythms when they move together – especially when they are at key resistance points.  This is something we'll be doing in AC and, of course Vegas this year.  

    AKAM/DC – Let's see, Down last Thursday and then down the next day followed by down down and down again and, just a month ago, they were at $33.50, not $34.66 (and that was before disappointing guidance) AND the market is weak so I think I'd rather wait a bit before calling a bottom and spending money on a position there.  

    GOOG/DC – Old news and what a wrist slap (although if they do it again I think it may become major).  Oddly enough, putting GPS's on cameras and driving around and taking street-level photos for virtual drive-throughs (mainly for real estate comps and to aid my RealTourExpress project) was the basis of a 1998 business plan of mine that I couldn't convince anyone to fund.  

  19. X starting to look good for a long term entry.

  20. /Cl / Phil  – Thanks.  I will put that on my crib notes.  I do watch the dollar on the same chart.

  21. AAPL / Dc – On Fast Money yesterday they had a fund manager that still had not sold any of his AAPL holdings because his cost basis was so low. The point that I was making last week is that there are still not enough buyers of AAPL yet despite the attractive valuation. If this guy has a cost basis of $100 and is holding 5% of his portfolio in AAPL, what is the incentive to buy more at $425! But if AAPL keeps going down, he might have incentives to actually sell some. 

    I guess we wait until the next earning report (4/23) or a big announcement on what they do with their cash to push up AAPL higher.

  22. GO AAPL!!!

  23. MoMo portfolio trade:   Sell to Close 15 GMCR March 60 calls @ 4.70

  24. Is that better Phil ;-)
    love reading all your stuff today!

  25. jabob
    whoaa! did you find religion!
    FU jabob :) !

  26. Good Morning
    Jabo—good karma—AAPL is up

  27. speaking of the worth of paper:
    Hopefully Phil won't charge me for this one :)

  28. jabob
    FU Willis :) !

  29. WFR down a lot

  30. Netflix up big today because you can now show your friends on FB, the crappy shows or movies you watched.  Absolutely nothing to do with earnings but I love these boosts, was a good entry for me again to write calls.

  31. MEMC Electronic Materials Inc. (WFR) intends to change the semiconductor and solar-technology company's name to SunEdison Inc. to create a global brand that better reflects its two businesses.
    Shares were recently down as the company also warned semiconductor sales will be slow during the first half of the year, but should strengthen in the second half as the industry recovers. The stock has climbed 69% so far this year through Tuesday's close.

  32. Phil/AKAM
    My comment "AKAM has found a bottom" was lame, but your play on AKAM has lost 60% of its value. Won't any further deterioration just kill the trade? Why not cut your losses now?

  33. Oil inventories a net draw but headline oil is up so not bullish but not as bearish as we'd hoped so don't expect immediate sell-off but pressure on NYMEX contract roll is still on for USO/SCO and yes, we can still play the bear lines (.50s) for oil on /CL but be careful as the Dollar is 83.28 and, if it drops, oil can pop up fast so more relaxing to use USO and SCO at the moment than /CL

     EIA Petroleum Inventories: Crude +2.6M barrels vs. consensus of +2.4M. Gasoline -3.6M barrels vs. consensus of -1.5M. Distillates +0.1M barrels vs. consensus of -1.7M. Crude +0.66% at $93.15.

  34. Phil—NFLX 190!!!
    FU CLF!!!!!!

  35. AAPL at $350 response:  If you look at chart that is the bottom of where in 2011 it started its bullish move.  Market starting to look at this as a value stock as the growth beasts dump it.  there is also a confluence of some key moving averages projected at that level.
    I guess what I am saying is Phil's play long at $350-$360 area looks good as there will be some institutional buyers here.  We may feel some pain as it drops in the time being but as Phil keeps saying we have until Jan 2015 for it to play out.  the more it dips, the more I will add to my position.
    BTW it is trying hard to hold its weekly low of $425.14…I am personally looking for a temporary bottom for a shorter term play apr/may puts (short)shall see

  36. Phil – RE: GOOG … yes, it may be "old new" or even old stale news, but when you have a major paper printing it people seem to refocus on it again. Perhaps Google is just starting to get "Appled" (or some verb like that). ;-)
    Nonetheless, what I found to be most interesting is that the NY Times moved the old news story forward by linking the Google invasion of privacy fight to Google Glass. 
    From the article:
    "The agreement paves the way for a major privacy battle over Google Glass, the heavily promoted wearable computer in the form of glasses, Mr. Cleland said. 'If you use Google Glass to record a couple whispering to each other in Starbucks, have you violated their privacy?' he asked. 'Well, 38 states just said they have a problem with the unauthorized collection of people’s data.'"
    Something to keep an eye on (no Google Glass pun intended) since the attorneys surely will!

  37. Fas Money – If we sell the April $150 puts, we're betting XLF holds $18 and we collect $3.30 so I guess it's worth selling 6 to offset a possible move against us and, if it goes our way, we make 11 x $6 (avg) before the 6 x $3.30s become a big problem but let's call the probable stop $5 (but we'll really play it by ear). 

    AAPL Money – So, let's see, lots of puts that say AAPL holds $400 but 2 years from now and, currently we are being charged $77,000 as a net negative.  Our speculative bullish play is down about $22,000 as we are foolishly clinging to the belief that AAPL will be over $500 in Jan 2015 and that's up $73 from here so AAPL would have to gain (accessing WOPR) $3.32 per month for the next 22 months.  Are we insane – it's only a $427 stock?  That's almost 1%.  I think (and this may be a crazy notion) that maybe if we try to generate $5 a month in sales over the next 20 months, we can collect $100 per long and then we only need AAPL to hold $400 to make our money.  Or should we give up?  

    $25KPM – I love the nothingness!  Let's see what's happening: 

    • QQQ – Our longs are flat and the short calls are wearing down – check
    • IBM – Our long spread is on track to make $2,370 and our short puts are on track to make $1,410 and our 3 short $200 calls that we sold for $2.60 are now $10.50 so we're down $2,370 on those for a net gain of $1,410 on $1,220 cash laid out less than two months ago – Oh, THE HORROR!!!
    • SQQQ – Oddly enough, same as QQQ as the long calls are flat and the short calls are losing money.  
    • XOM – Speculative put, not worth doubling down yet.  
    • TLT – We were supposed to take 1/2 off the table yesterday at the average entry ($2.65) which would leave us with 10 at net $2.65.  This should be a reflexive action after doubling down – you WANT to get back to 1x at the lower basis if possible unless there is an amazingly good reason not to.  
    • JNJ – Another speculative put.
    • USO – And another – I guess we're bearish!  

    $25KPA – Funny how it's hard to tell if you are bullish or bearish until you review your positions sometimes.  As to the margin.  With the Income Portfolio much less than 50% invested, we should have well over $500K of margin sloshing around and, while I don't like to use it, I'd rather use it here and roll my positions properly than take losses we don't have to just because margin is "tight".  

    If we were going to operate with margin restrictions, we never would have traded GOOG or AAPL in the first place.  That's why we now have a $25KPM – specifically for low-margin trading.  The $25KPA is the "fun" portfolio for people who have sensibly invested $500K or $5M in a proper, conservative, long-term account and want something aggressive to keep them busy while they wait for trees to bear fruit.  

    Meanwhile – Hey – we didn't give back $18,000 today! 

    • AAPL – Similar to AAPL money, we are betting AAPL is more than $486 by Jan and over $430 in April (and we make $18,350 more than we're currently showing as a net if it is) and then we have that damned $450 call that's our weekly lottery ticket.  
    • SQQQ – That will expire worthless
    • GOOG – I'm not doing that one again (see whatever day it was I just reviewed them).  All we can do is watch and wait on that one. 
    • IBM – Same as $25KPM
    • VMW – The bull spread is doing fine with VMW at $79.50 – not much chance for the $105s but they were just leftovers from a profitable earnings play.  
    • FB – GOOG to the moon and FB laying around $27.  That was unexpected.  Nothing to do but roll the short puts and hope April treats us better.  
    • EXPE – At $64.64 nothing to do but watch and wait.   This is another case where we're being "charged" $2,100 for the short July calls and $412 for the short March calls (plus the margin) but we're right on track to collect the full amounts.  
    • AKAM – $34.50 and, as I just noted, maybe not done going down but we also just talked about how we like them long-term so our $2.15 entry was a mistake but don't forget they came from a profitable leftover (May $43s) that had .80 left and we rolled to the April $36s at $2.15 for net $1.35 because we thought we could capture a bounce better from the lower, shorter-term strike.  We DD'd already at $2.15 so average for 20 is really $1.75 and now .80 on 20 so still, before I spend more money, I want to see where it stops and THEN establish a position.  With 37 days to go, if we're not down next week then it's more attractive to spend .85 more to roll down to the April $34s (now $1.65) as they have a .59 delta and will pay us back quickly, rather than retreat to May again.  That is, of course, assuming we still like them after watching them for another week.  I'm always a big fan of waiting and getting more data before committing more cash – very unCramer-like. 
    • SQQQ – Same as $25KP – when you sell premium instead of buying it, you can make money on bullish and bearish bets at the same time. 
    • XOM – Speculative put
    • TLT – Same as above, we should be 1/2 out at $2.65, leaving 10 at $3.
    • JNJ – Speculative put
    • USO – Speculative put

    Well, nothing I'm unhappy with.  Oh and look – the market is back up.

  38. $DXY few days ago I mentioned if DXY breaks its range it was in it could see 83.20-83.40 area before turning south again.  83.51 was Aug 12 high. You have daily Bollinger bands up there too. Just food for thought

  39. Pharma,
    What are you thoughts on Spectrum (SPPI)?

  40. WFR changing its name, oh, and says semi – conductor sales are sluggish….double whammy!

  41. Ah, 3/6 must be the day we reviewed GOOG as that's the most recent day of trades – it should not have taken me this long to figure that out…

    iPod/Rexx – Would have taken me a lot longer than that!  

    X/Jfaw – Emphasis on the LONG but I do like them for the next 20 years at $20.  

    Dollar topped out at 83.33 but oil can't even hold $93 as the Dollar is pulling back.  I don't know what oil bulls were expecting but it seems like they didn't get it.   I think my public call to short at $93 is affecting them now – huge amounts of sellers at that line and, if those guys listened to me and refuse to buy barrels back, that puts NYMEX crooks on the hook with contracts they can't wriggle out of and that's what can make them freak out as expiration day comes because it's one thing to be assigned a stock and have it delivered to your account but quite another to be assigned 100,000 barrels of oil and have it delivered to Cushing where you have to arrange to pick it up and take it to your point of sale (if you ever do find a buyer for 100,000 physical barrels of oil in a pinch).  Each barrel weighs about 350 pounds, by the way, so bring a back brace!  8) 

    AAPL/StJ – Usually they have a pre-earnings event where they announce stuff.  So far they have only scheduled a developers' conference in March (and you know how important developers are) but they never announce stuff there so we'll have to wait and see what's next on their agenda.  

    Thanks Jabob – all better now. 

    Paper/Rperi – I'll trade you if you watched my developers link.   Actually, I liked that one a lot.  

    Jabob, on the other hand, will be getting an invoice for that one! 

    WFR/Lionel – Dropped guidance on price per watt but they expect watts sold to compensate and are looking at about 5% revenue gains over last year (but they lost money last year).  Also, changing name to SunEdison, Inc. – I don't like that at all.  Anyway, no one thought they would have up sales this year anyway as they are retooling for longer-haul so let the suckers run and maybe we can find a nice entry.  April $5 puts can be sold for .55, that's a nice entry to start with.  

  42. SPPI – LOL.  I was just looking at them, and their sales are cut in half.  Their stock is cut in half.  Hummm!  Wait for a little bit, but the sale of the Apr $7 Ps looks ok as an initial entry.  We were in them many eons ago at $3 or so, rode them up to about 10, and bailed…sales were going to be hard, and reimbursement remains a struggle.  I have a neighbor that works for them and it was noted that all this neighbor does is work with doc's on how to file for patient insurance use.  Now that is a job!

  43. On USO short, I am keeping a tight leash on this one as it is in the middle of its current wedge.  This morning my school posted next CL supply level at $94-94.25.

  44. And now what the Hell is AAPL doing?  It's going the wrong way.  That's not down….

    Good call at $425 Dawn.  

    AKAM/DC – See above.  

    NFLX/Jabob – Come to Poppa baby!  

    Dell FlatTop (my (TM)/StJ  - I've been waiting for that since tablets came out.  That is EXACTLY what I want.  The way voice recognition is now, who needs a keyboard and that's going to be as easy to carry as the extra LCD screen I have for my main laptop and it will run my trading software – what's not to like?  

    Old news/Diamond – True, what is old news to us is a shocker to most investors once the MSM finally picks it up but the amount is so small in relation to GOOG – I doubt anyone will be running for the exits on that basis.  I'm not sure that the leap from protecting data in the home (where there's an expectation of privacy) to protecting conversations in a public restaurant is really going to play out.  It's privacy that's the illusion here, not GOOG's violation of something that probably 60M people on the planet could also do if they wanted to drive past your home.  Meanwhile, we know where the technology is heading:

  45. ETFC just had option activity of 20,000 Jan 15 $7 puts with 20,155 open interest.  Bid/ask spread is $.26/.42.  Would this most likely be a large put sale with a net entry below $6.75? 5 year chart shows a low of $6.10 in March of 2009.

  46. dawn….USO, fills that gap back up, and I noted it yesterday, even though intraday it went down…and I got out for 10%.

  47. WCRX – April 12 Ps STO for 20c. 

  48. AKAM/Phil,
    One basic question on the AKAM position: In most cases you enter a long position with a short put which may be paired up with a bull call spread.  Now I understand that the AKAM calls were rolled from an earlier trade, but what was your rationale for not writing puts at say 32?  The theta burn would have counteracted the bleeding in the long calls that's going on right now and if it goes down, you can always DD on the short puts.  Thanks as always for your insight!

  49. newt / yes, you can update just like you usually do. there are other more 'darksites' I can turn you onto once you get set up.
    phil / leverage – no clean room – no phone – love it. Everything I gave you is free, no reason for Jackie to spend a dime.

    StJ / PM you mentioned you ran a TOS PM margin analysis – can you explain how you did this ? 

  50. Phil / NFLX
    OK, I've had it – this is the same old social integration BS we've seen 1,000 times. Perhaps next they'll provide sensors in your fridge that will lock into what movie you're watching so you're friends can eat the same thing.
    I'm closing my old bear spread for a few hundred profit – need to get aggressive with NFLX – can reco a Jan spread ?
    I just keep staring at that Jan 50 point gap and salivating …

  51. NUVA – Mar $20s options are still up from the initial entry – close to a double.  We sold 1/2ish at 25c, so either take the rest, or be prepared to break even.  I still think they blow through 20, but TA says the gap has been filled and it is prudent to revisit the risk/reward.

  52. Huge POMO days tomorrow (2.75-3.5B) and Friday (4.75 – 5.75B)… is just a measly 1.25-1.75.

  53. Wombat-I posted on the option chat this morning I also think NFLX wants to see higher levels and I am eyeing that gap too!  Not sure it fills both of them though especially as the 61.8% swing Fib is around 208.65…I am thinking a Bear Put spread…thoughts anyone?

  54. That Ballmer video is hysterical!  

  55. Dollar/Dawn – Swiss don't want Euro that week (below $1.29) so not very likely Dollar goes that high.  Yen also seems toppy at 96, though who knows with new BOJ guy coming on-line soon – he's shooting for 100+ I think and that's only going to come with Dollar 95+ but they have to balance that with Euro buying as well (since the Yen is measured against both) so not so easy to dump your currency as one may think.  

    Silver actually failed $29 and is now testing $28.90.  As with oil, not very interesting to play with Dollar so high now (83.255) but copper holding $3.54 is a very good sign so I still have faith in both but copper a bit more interesting as a bull play off that line (/HG) at the moment – especially if the Dollar goes below 83.25.  

    Reich/Rustle – I love his videos.  That was classic:

    American wealth distribution in the past 30 years: Imagine picking up a rubber band and stretching it. Now put that rubber band down immediately, because someone in the top 1% just bought that rubber band and every other rubber band on the planet. Also, he's suing you for touching his rubber band.

    ETFC/Rperi – I never pretend to know what that stuff means – that’s Najerians' job (pretending, I mean as no one really knows – as his results demonstrate).  Logically, I see a 30,000 contract 2015 $10/17 bull call spread at about $2.50 and that, coupled with the sale of ridiculously out of the money puts for .40 nets in for $2.10, which is a .50 premium over two years, or maybe .65 as they only sold 20,000 puts.  I don't know the timing though and it could be a bearish play at .40 with a delta of .10 on the expectation ETFC drops a buck back to the 50 dma on low volume hitting earnings and that's a 25% winner and we have to assume someone making that trade has low friction on fees too.  As a put sale, it's not very margin efficient (1:1.5) but, holding $800,000 against $1.2M in margin for two years is not so terrible and, as you note, the downside is that you own 2M shares of ETFC for net $6.10 and that's lower than they were in '09 when there were rumors that they were unable to pay out account holders and about to go BK – so not a terrible bet.  

    AKAM/Wappler – Because it was speculative and I don't really, Really, REALLY want to own AKAM for net $32 as a long-term investment – especially in my short-term trading portfolio.  AKAM is a serial disappointer with dips from $40 to $34 in Nov and $42 to $33.50 on earnings this month and again from $38 to $34.50 (so far) in March but, with $1.75 invested in the $36s, we just want them to visit $38 again and, if it happens sooner than 30 days from now – we'll still have a premium as a bonus.  IF they fail to hold $33.50 and keep falling – THEN I will become interested in selling puts, but not in the $25KP but I certainly don't mind taking a $3,500 loss in the $25KP and then collecting $8-10,000 for selling 20 of the 2015 $28 puts (now $3.70) as a trade (just $5K of net margin, too!).  Of course I'd rather not lose the whole $3,500 – and we haven't yet, but the downside isn't terrible enough to force me to panic to avoid it just yet.  

    Free/Wappler – Oh I got that and thanks.  It's not "free" for Jackie as she has a solid weekend's work ahead of her.  As the carpet is exposed (was covered in clothes) Tina is screaming "what the hell is that" as she examines this and that carpet stain.  So far, we've identified nail polish, glue, lava (from science volcano), silly putty, silly string, whatever you call Methos and Coke when it mixes…  It's very difficult living with a young evil genius.  

    POMO/Pharm – They need to sell those notes today.  

    Ballmer/Rperi – Not if you're a shareholder!  

  56. Margin / Wombat – Easy, you just look at the margin required for each position and total it… If you don't have PM margin on your portfolio you can enable it in Paper Money. I do the same thing for the Income Portfolio although I have yet to do it for the new one. Weekend work.

  57. danwr/NFLX
    Like your TA contributions.  Thanks.
    I'm 90% TA.  Very active trader with 1day/1min, 3d/5m, and a hint of 20d/1hr directing me.
    Based on yesterday close and TA signals, NFLX certainly did not look like a long.  Todays silly news pop IMO a good entry for the BPS you mentioned.  For me ….. I always try to be on the sell premium side, so I'll open a Bear Call Spread.

  58. Phil
    Amongst the things you found on your daughters floor I also found used contacts strewn all over the floor. It seems that when they pull them out at night they look better on the carpet than they do in the trash. When they were younger my daughters managed to pierce one of those jiggly liquid-filled toys getting green sparkly goo all over the white carpet in their room! It's all about the memories! Right?

  59. New trade I did this morning somewhat up already a little but still tradeble.
    WYNN Jun13 Back ration
    Buy 3x 112.50/ 6x 125 call @ 2.80
    sell 3x Jun13 110 put @ 3.00
    cost of aprox 50$ credit
    Lower protection 112.51
    upper 137.49
    Aprox profit at 125 3745.00
    PM margin 560.00

  60. I trust closing my lunch money again USO  done at .92

  61. Have to share this one – just saw it while having lunch:

  62. Yodi / Backration – isn't that another word for bacon ? ; >
    dawn / NFLX  Personally I dont care for PUT spreads, I prefer the calls, as in no situation would I want to own this stock, but the TA lens is telling me to pull the trigger – lets wait and see what Phil thinks.
    StJ / PM
    Thanks – just figured it out. You can change it in Setup to reflect Margin Req.
    Phil  / Who 'da man ?
     I PASSED MY PM TEST !!!!!! Wow. My stock and option buying power are now equal, lots more breathing room. I have to say though – that test was pretty fricken hard for a non-greek.  I got a PPT from TDA on PM and I'll read through it this weekend. I feel good about it because it freed up a bunch of cash and I'm now sitting at 50%, equal with the group.
    Any advice on Margin risk and maintenance ?

  63. Out of the USO April Puts at /QM $92. 

  64. USO—out at $1.01 27.8% after it filled its first gap.   Would love to reenter on retrace--thanks Phil!
    ccsincsd--I keep my eye on 1m/5m/15m for scalping in the morning.  Always keep my eye on the 1h, daily and weekly levels to know where the hurdles are big picture for swing trades.

  65. Phil you did no tell us to set the dive cylinders on 92.00 !!! Could have had a dinner for two!!!

  66. dawnr
    Congrat on USO daught we will get an other run.

  67. NFLX, LNKD and CRM….all POS.

  68. Button, I'd hold out for more on the USO trade… I believe we'll go down for the next few weeks before they jack it up into summer.

  69. Meanwhile, you can't even have a sandwich in this market – Dow flying again, RUT new highs, oil down to $92.25…  Really I just had a sandwich – what could I have missed?  

    Memories/DC – Yes, I'll save the bill for the new carpet so I can give it to her for a wedding present… 

    WYNN/Yodi – The reason I wouldn't go for them is they are just under the 50 dma and the 200 dma is $105 and I don't know what the China crackdown will do to Macau and I think a lot of the good news on Vegas is baked in here since they're about 10% over last year's $100 average with barely 10% more profits projected for this year and that's only $6, which is a p/e of 20, and the 50 dma is $120 so why would I think WYNN should need a p/e of 21 so badly it punches through resistance?  Not that I think WYNN is terrible but just that I'm sure there are better fish in the sea. 

    Speaking of fish, ISRG back where we liked it ($510) 

    $92 on oil, wheee!  Can go long from here into 2:35 NYMEX close if Dollar behaves. 

    PM/Wombat – Whoa cowboy!  You did not free up any cash, you now have more margin.  Do not confuse those concepts.  PM should be used very sparingly on things where you KNOW the risk is reasonable vs. the ordinary margin requirements (like short AAPL 2015 $350 puts, now $38.50 for a net $311.50 entry).  It should NEVER be used to lever your risk – that's a very dangerous thing unless you are a real pro trader.  As I mentioned a couple of weeks ago when I was in California with Opesbridge, it took a good part of an afternoon on the phone with a hedge fund brokerage to get them to understand that I was right and their computer was wrong in calculating pm.  Almost anyone else in the World would not have won that argument (or have thought to have it in the first place).  Brokers can recalculate your requirements in a crash in an unfavorable manner and margin call your account way before you'll ever win a discussion on whether or not it's "fair".   Not only that but they change the margin requirements on things that you already own without notice and that can really mess you up as well.  

    Here's a good paper on Portfolio Margin Strategy and Risk but it's got a lot of math.  Here's the article Sage and I wrote back when they first made PM available to retailers.  

    Meanwhile, Wombat – congrats on passing the test – bet you didn't think you could do that a couple of months ago, when you started!  

    USO/Button, Dawn – Very wise exit if you don't mind day-trading.  I'm still looking for $91 or lower by next week.

    $92/Yodi – Oh come on, you know it's greedy to go for more than $1 on any run in oil.  

    NFLX $194.50!  

  70. Jro / USO,
    Could be.  I am looking to reenter if we get back to /QM $92.50 on this bounce should be about $0.90 for the April $33.5

  71. Wow, if investors are chasing yield, why are the high yield closed end funds selling off, taxable and non-taxables alike??? Manipulation, or the start of something else?

  72. Kyle Bass:

    The AIG of the world is back – I have 27 year old kids selling me one-year jump risk on Japan for less than 1bp – $5bn at a time.

    You know why? Because it's outside of a 95% VaR, its less than one-year to maturity, so guess what the regulatory capital hit is for the bank… I'll give you a clue – it rhymes with HERO…

    If the bell tolls at the end of the year, the 27-year-old kid gets a bonus… and if he blows the bank to smithereens, ugh, he got a paycheck all year.

    We are right back there! The brevity of financial memory is about two years.

    I wouldn't sell nuclear holocaust risk in Dallas for 1bp – you should be fired for thinking about selling something for less than 50bps.. and yet – this is happening again…

    And it's happening in huge size – huge – we bought half a trillion dollars worth of these 'options'…and interestingly enough, one of the biggest banks in the world called me the other day and asked me if I would close my position – that was an interesting day for us – that happened to me in 2007 right before the mortgages cracked.

  73. TLT—wow

  74. PM Margin / Wombat – To add to what Phil said, TOS is pretty good at showing you what your margin will be like based on the underlying instrument. In the Risk Profile sub-tab of the Analyze tab, you can move the Slices lines on the price axis and it will show you how the margin will increase (or decrease). A 10% move can wreck you margin.

  75. TSRX also tearing up the carpet….. zoom Zoom!!

  76. AAPL on its way to testing 435 again….

  77. Pharm / WCRX - curious, why now?  There is a 3 year downtrend line it just tried to get through and failed, so why not wait for confirmation with a break through of LT resistance?

  78. stjeanluc – PM margin calls are a GREAT way to learn real-time crisis management! ;-)

  79. AAPL-in  my humble opinion if price does not breach the weekly high of 439.01 then it is rangebound and just playing with us.  It also has resistance of the 20 daily EMA to contend with the bots who have itchy fingers. 
    The contra indicator to buy was Cramer last night saying stay the hell away from AAPL. he is such an ass.

  80. Big White House meeting on stopping hackers with Jamie Dimon and Rex Tillerson – that's never good when those two guys are in a room together and given an opportunity to screw people over.  

    Yield/Pharm – Profit taking and negative spin on those funds lately in the news if I remember correctly.  

    1:04 PM The Treasury sells $21B in ten-year notes at 2.029%. Bid-to-cover ratio of 3.19, vs. the previous 2.68; indirect bidders take 47.7%, vs. the previous 28%. Direct bidders take 30%, vs. the previous 24.2%.

    1:08 PM Down sizably earlier, Treasury prices get a boost following the strong 10-year auction with high yield of 2.029% vs. the when-issued yield of 2.05%, and indirect bidders taking down nearly 50% of the sale. TLT -0.2%.

    Wow. Ireland has reportedly drawn drawn €10B in bids for its 10-year note auction, and sold €5B at 240 bps over mid-swaps. The result is far-better than government hopes to sell just €3B in debt.

    Italy sells €3.32B of 2-year and €2B of 15-year notes in its first auction since being downgraded by Fitch last week. Demand was a bit weaker than previous sales – bid-to-cover of 1.28 vs. 1.37 at the last one – but the yields are inline with the secondary market. Milan is the leader in Europe's decline, -1.6%. Stoxx 50 -0.6%EWI -8.1%YTD.

    PBOC Governor Zhou Xiaochuan says China should be on "high alert" over inflation after February's price increases topped expectations. Monetary policy is "no longer relaxed" and is "neutral," he says. Zhou's remarks add to signs that China is tightening policy even as its recovery may be hitting a bump. Zhou also expresses uncertainty about whether he'll stay in his job; speculation has increased that he will remain.

    The percentage of bears in the Investors Intelligence polldeclines to 18.8%. It's the first time below 20 since May 2011, and dips below 20 marked market tops in 2010 and 2011, notes  a usually bullish Ryan Detrick. "Be aware." 

    Another Tepper rally? The hedge funder remains bullish, telling CNBC he sees a 20% return for the S&P this year (we're already about halfway there), and maybe more should the economy deliver an upside surprise. SPY adds a couple of ticks, now +0.1%.

    An increase in the factory workweek to the longest since World War II indicates that the jobs growth in the sector is set to continue. Production staff worked an average 41.9 hours a week in February, tying with December 1997 and January 1998 as the most since May 1944. Companies will need to think about recruiting for future needs, not just for their immediate requirements, if demand stays steady, says employment consultant John Challenger.

    The Forensic Accounting ETF (FLAG) rolls out new names given "A" and "F" ratings after a check of the books. Those getting top scores are LMTANF, and BRCM, while those failing are HDFCOL, and TRIP. "Home Depot's revenue increase of 6% doesn't justify the stock's 23+ P/E ratio … Ford has high and increasing cost of goods sold putting pressure on margins."

    UBS highlights eight stocks it thinks will benefit from U.S. infrastructure spending, particularly in long-term areas such as pipelines and chemicals as well as isolated projects such as rebuilding from Superstorm Sandy: ACMFLRFWLTJECPWR,TPCURSWG.

    The Case-Shiller home price index will post an 8% Y/Y gainin January, predicts Zillow, which uses past data combined with its own Home Value Index to give us the news before it hits. The forecasts tend to be pretty close to the mark. 

    Everybody wants real estate. KKR is prepping its first-ever fund dedicated to real estate and reportedly has an initial $500M commitment. "We've got a real sense of urgency around scaling in these businesses and grabbing as much land as we can." TPG Capital is planning the launch of at least a $1B fund – it would be the largest initial property fund since Lehman's 2001 $1.6B launch. That didn't work out so well, but first there was several years of partying.

    Credit Suisse grows more selective on MLPs, citing four whose valuations it thinks have grown excessive. El Paso Pipeline (EPB -1.9%) is cut to Neutral, as the firm sees decelerating distribution growth as drop-downs associated with the acquisition of El Paso Corp. by Kinder Morgan are absorbed. TLLP and EQM also are lowered, but CVR Refining (CVRR +1.9%) is raised to Outperform. 

    Chevron (CVX +0.3%) is one of few energy stocks on the plus side today after two firms raise target prices. BAML cites a slate of projects likely to be sanctioned in coming years growing to the point where the long-term production outlook is falling into place. Cowen also likes the production profile, and expects CVX to maintain its sector-leading operational and financial performance. 

    Chevron (CVX) is in talks with potential buyers for Canada's first exports of liquefied natural gas, paving the way for a $15B project that would open up a new route for North American gas to Asia, FTreports. CVX CEO John Watson says the project, a JV with Apache (APA), already has gained an export license. He seems keen to price the gas in relation to oil rather than lower-priced natural gas. 

    More headaches in Papua New Guinea for InterOil (IOC-5.8%), as the country's energy minister takes out full-page ads in local newspapers objecting to IOC's comment in its 2012 results that the government had approved its proposed liquefied natural gas project. The minister says the country only provided conditional approval for IOC to develop half of the Elk-Antelope gas resources. 

    Since when is Macquarie such a market mover? Its downgrade of Valero (VLO -4.4%) is hitting refiners hard; the firm thinks the government's forced usage of biofuels is causing unintended consequences that will negatively impact refiners and may result in high RIN prices. Ratings for Holly Frontier (HFC -2.5%) and CVR Energy (CVI -3.3%) are cut too. Also: TSO -2.9%WNR -3.7%,MPC -1.5%.

    Refiners are taking a hit on an after-the-fact downgrade by Macquarie, but surely they will like the latest EIA report showing a bigger-than-expected gain in oil (USO) inventories, and a far larger-than-expected decline in gasoline (UGA) stocks. A refinery-heavy ETF, PXE -1%.

    It's worth noting that Macquarie, in sounding the alarm over biofuels costs that could hurt earnings for refiners, thinks the problemwon't hurt all refiners equally. It says the well positioned companies are those that are better integrated between refining and midstream product terminal assets that support self-blending of ethanol, such asMPCNTITSO and WNR.

    A deal has been cut for the takeover of nearly-bust Suntech Power (STP) by the city of Wuxi, according to an official at the town's holding company, Wuxi Guolian. The company earlier reached a deal with some of its creditors to delay payment on convertible bonds due at week's end.

    Cliffs Natural Resources (CLF -4.3%) plunges near four-year lows, capping a 40% YTD decline. Cowen analysts see CLF's move to idle its Wabush Pointe Noire pellet plant as prudent but accompanying cost guidance seemed "aggressive." Given recent action in Chinese steel prices, the firm sees further downside risk to iron ore prices which could add increased pressure to CLF shares.

    The TBTF banks lie in bed at night dreaming they had the kind of government backstop afforded to the sugar industry. TheUSDA may buy 400K tons of sugar to prop up sugar processors which borrowed $862M under a government price-support scheme. Roll that one around for a few seconds. The higher prices pay for processors' vacation pads, but hit companies like HSY andNSRGY.PK, along with their customers.

    The stock market rally is missing what historically has been a key element: a house call from Dr. Copper. Falling copper prices mean "a booming economy isn't around the corner," Michael Pento says, suggesting the rally may be ahead of itself. Goldman thinks a China-related price drop is excessive, but China bears such as Jim Chanos see "ghost cities" and worry about inflated demand about to collapse. - Wow, there are ghost cities in China?  That is big news, isn't it?  The fact that we know the name Ordos already means we can totally ignore Goldman's "discovery" of the China problem.  Good article on it here.    

    This is a big thing!  As Lockheed Martin (LMT) looks to diversify amid steep government defense cuts, the company is developing a technology for desalinating water that slashes the amount of energy needed by 100 times compared with existing techniques. The method uses sheets of pure carbon called graphene, which are just one atom thick, as the filter. "It's 500 times thinner than the best filter on the market today and a thousand times stronger," says Lockheed engineer John Stetson.

    Wilbur Ross continues the P-E rush into beaten-down shipping, marketing a $500M fund to buy distressed assets in the sector, reports Bloomberg. Often early, Ross spent $900M buying crude product tankers in 2011. SEA +6.9% YTD.

    Ford is an underrated dividend stock as it features a strong balance sheet and has a payout ratio of only 13.5% of trailing earnings, according to SA contributor Marshall Hargrave. Though the automaker's stock trades level with peer GM on a valuation comparison, in relation to Toyota and Honda it looks cheap. Ford currently trades with a 2.98% yield. 

  81. Dawn/ Cramer- i remember all the brokers having tvs in their offices and watching the crap….

  82. Electric vehicle wrapup: 1) A Reuters article takes a 
    harsh look at the cost of Norway's government-assisted push into electric vehicles. Pure market share is up to 3%, but the numbers aren't adding up. 2) Another win for Tesla Motors (TSLA +0.4%) in its battle against auto dealers as Minnesota takes steps to allow the automaker to open retail stores in the state. 3) Henrik Fisker is reported to beleaving Fisker Automotive due to a disagreement with the management of the company he founded.

    More on Retail Sales: Two months into the year and retail categories look reasonably strong compared to estimates with the exception of electronics (BBYRSHCONN) and department stores (JWNMDDSSHLDKSS) which are running below last year's pace of sales. Improved results in the automobile and sporting goods categories (guns) were no surprise, but building material & garden (HDLOW) looks slightly better than anticipated, according to analysts.

    Discover FInancial (DFS +1.5%) is upgraded to Buy at FBR Capital, which boosts FY13 and FY14 estimates thanks to higher receivables growth, better net interest margin, and lower credit costs. FBR downgraded Discover 2 months ago because of the "It" card, but the early returns have made believers of the analyst team.

    Heard during Domino's Pizza (DPZ -0.2%) presentation at the BofA Consumer & Retail Conference: The highlight from execs is an outline of the company's long-range outlook for growth. Without setting an end date, Domino's says it expects global net units to rise 4% to 6% and global retail sales to move up 6% to 10%. International same-store sales are forecast to outpace domestic same-store sales, 3%-6% vs. 1%-3%. P&L tidbit: The effect of higher/lower gas prices hits commodity costs to a much larger degree than the expenses tied to refueling drivers' cars. (webcast) 

    Tidbits from Yum Brands' (YUM +1.1%) presentation at the BofA Consumer & Retail Conference: 1) Profit breakdown: Asia Pacific 42%; Europe 23%; Americas 18%; Middle East Africa 17%. 2) The company forecasts a mid single digit EPS decline in 2013, in-line with estimates. 3) Execs say they see a big opportunity in China to Americanize the Chinese consumer for breakfast as they set plans to "own" the segment. 4) Also on the radar in China is developing a fast-food Chinese food chain. (webcast)

    Why is McDonald's (MCD) trading at a lower earnings multiple than Yum Brands or Burger King? That's the question SA contributor Always Bullish poses as he pitches the case on McDonald's being an undervalued company with excellent growth opportunities. The take: At its current pace of expansion into promising markets, the restaurant operator stands a good chance of beating its 3% to 5% systemwide sales target despite the recent dip into negative sales growth (MCD sales: Jan.Feb.) 

    Buffalo Wild Wings (BWLD +1.8%) treks higher as the stock gets lined up once again by traders as a "March Madness" play linked to the popularity of the restaurant chain during the annual NCAA basketball tournament. What do the charts say? BWLD at tournament time: 20112012

    Analysts line up Diamond Foods (DMND +2.8%) as a possible acquisition target as the company puts its earnings reporting troubles in the rear-view mirror. One potential suitor could be Kellogg (K +0.3%) on the theory that if the food company target was called a "good fit" by execs last year with DMND trading at $28 a share – it might look even tastier at $16.

    Stifel Nicolaus sees more upside for Anheuser-Busch InBev (BUD) as it raises its price target on shares to $112 from $94 with the Grupo Modelo purchase looking promising. Though international markets are a source of growth for A-B, it also sees some light at the end of the tunnel with domestic sales in the U.S. after they turned around in 2012 for the first time in four years. Look for an even bigger push from the company on new beer brands to complement Budweiser and Bud Light.

    Dollar stores (DGDLTRFDO) are sitting in the sweet spot for retail, according to analyst Kristin Bentz. Though the stores were once a destination for shopping "treasure hunts," a trend of consumers using the outlets as de facto grocery stores for basics and consumables is firming up. Wal-Mart (WMT +0.5%) may get a piece of the action with a plan to increase its footprint of small-format stores, while grocery stores could suffer a loss of market share (KRSWY,SVU). (full report .pdf)

    Heard during Abercrombie & Fitch's (ANF +1.4%) presentation at the BofA Consumer & Retail Conference: 1) The overall tone is positive from execs as they hone in on the prospects for the international side of the business. 2) U.S. store closures are called a strategic initiative by the retailer with online becoming more of a focus. 3) Brand awareness is growing in Asia, in particular in Hong Kong. Comparable-store sales in Chinese stores are showing improvement. (webcast)

    The FDA yesterday intensified its warnings for azithromycin, an antibiotic that can lead to a fatal irregular heart rhythm in some users. Known as "Z-Pack," the drug is used to treat bronchitis, pneumonia, sore throats and earaches. A major manufacturer of azithromycin is Pfizer (PFE).

    Priceline's (PCLN -0.5%acquisition of Kayak (KYAK-0.2%) will delayed thanks to an extended review by U.K. antitrust regulators. The FTC has already signed off on the deal.

    Disney (DIS) CEO Bob Iger indicates a theme park in Shanghai may be just a start for a new round of international expansion. He says growth markets like Russia, India, and Brazil provide excellent opportunities for the company to build parks.

    "You should be investigated." "No, you should." That's about the jist of the latest exchanges between Bill Ackman and Herbalife (HLF -0.7%). Ackman yesterday backed a call from the National Consumers League to probe the company for possibly being a pyramid scheme. Herbalife responds by accusing Ackman of making "a reckless $1B bet against the company based on knowingly false statements."

    More on VMware: An aggressive long-term growth forecastis helping shares rally. VMware (VMW +8.4%), currently expected by the Street to post 15% revenue growth this year and next, is forecasting 15%-20% annual growth from 2014-2016, as its efforts to expand its cloud/data center management and software-defined networking offerings bear fruit. VMware has slightly lowered its 2013 revenue guidance to account for the divesting of assets going into thePivotal Initiative.

    EMC (EMC +2.5%) guides during its investor day for 9% annual revenue growth over the next 5 years. The Street is currently expecting 8% growth for both 2013 and 2014. Shares are higher thanks to the guidance, VMware's rally, and the Pivotal announcement. Also: CEO Joe Tucci predicts EMC and Cisco's (CSCO) VCE JV will "far exceed" $1B in revenue this year – John Chambers recently statedVCE, 58%-owned by EMC and 35%-owned by Cisco, is on a $1B+ run rate. 

    Better late than never? Bernstein upgrades its stance on the global DRAM industry to Overweight, and in doing so helps Micron (MU +2.2%) make new 52-week highs. The first signs of improved pricing for PC DRAM arrived about two months ago, when Micron shares were much lower. Production cuts, along with the industry's consolidation around Micron, Samsung (SSNLF.PK), and SK Hynix, have stabilized DRAM prices in spite of still-weak PC demand andslowing growth in the amount of DRAM included in the average PC.

    "While we realize CRUS shares aren’t for every investor due to its Apple concentration, we still believe that when investors return to AAPL shares, CRUS will get a much needed lift," writes Needham's Vernon Essi, coming to beaten-down Cirrus Logic's (CRUS +3.3%) defense. He also declares Cirrus is "unlikely" to lose its status as Apple's iPhone/iPad audio codec supplier. Shares now trade at just 6x FY14E (ends March '14) EPS, even as estimates fall due to iPhone-related concerns.

    MEMC (WFR-5.2% after: 1) Guiding for 2013 semiconductor revenue of $940M-$990M and solar systems sales of 420MW-490MW, up from 2012 levels of $918M and 383MW. 2) Changing its name to SunEdison. 3) Announcing the creation ofSunEdison Capital, a solar project financing arm. VP Carlos Domenech will head the unit. MEMC's Capital Markets Day starts at 11AM ET (webcast). 

    "We only infringed on ALU's patents under our agreement with MSFT":  Barnes & Noble (BKS -0.4%seeks in a federal court in New York a ruling to uphold a previous decision that the company didn't infringe on Alcatel-Lucent patents with its website and e-reader. The company says its use of Microsoft software on its websites and hardware brings a MSFT-ALU licensing agreement into play.

    Facebook's (FB -1.8%) mobile ad quality is declining, writes BTIG's Richard Greenfield in a bearish note that's pressuring shares. Greenfield, who downgraded Facebook to Sell last month, thinks mobile ad sales could fall Q/Q in Q1 (a seasonally weak quarter), and that Street estimates for 2014 and beyond are too high.

    Amazon (AMZNmakes so much money off of its Prime customers it could drop the $79 annual fee and still come out way ahead. Though the company has no pressing reason to cut into the Prime program with it accounting for close to a third of the firm's operating profit, it's a lever which should strike some fear into retailers such as Target (TGT) and Wal-Mart (WMT).

    More on Amazon (AMZN) Prime: Morningstar

  83. More on Amazon (
    AMZN) Prime: Morningstar notes the big jump in Prime memberships is partially due to the free trial included with a Kindle Fire. According to the firm's estimates, 30% to 40% of all trials have been converted into a paid membership – a decent rate compared to other promotions. On profits, estimates run as high as$78 per member after accounting for shipping and licensing fees. (Previous: Prime subs +10MAmazon's pricing lever)

    Amazon (AMZN -0.2%launches its 8.9-inch Kindle tablet in the UK, Germany, France, Italy, Spain and Japan. In addition, the company lowered the prices on the larger-sized tablet in the U.S. to $269 for the Wi-Fi version and $399 for the 4G product.

    Oops, there goes $3.5Bn of Slim/Gutierrez's money:  A downgrade to Neutral from HSBC sends America Movil (AMX -5.2%) shares tumbling. Credit Suisse issues a similar downgrade yesterday, but shares fell only modestly. Both ratings cuts follow the arrival of a bill that would create an independent regulator that would have the power to impose penalties on and perhaps even break up AMX's Mexican telecom ops. Grupo Televisa (TV -2%), also targeted by the bill, is down as well.

    "There is not and has not been any specific evaluation or activity underway regarding BlackBerry (BBRY -0.9%)," says a Lenovo (LNVGY.PK) spokesman, discussing recent speculative remarks from CEO Yang Yuanqing. BlackBerry shares remain up 9.8% on the week. (Pac Crest)

    The U.S. version of Samsung's (SSNLF.PK) Galaxy S IV will use a quad-core Qualcomm (QCOM) processor, while international versions will use Samsung's Exynos Octa, Bloomberg reports. The S IV also said to include eye-tracking tech , but it won't support automatic scrolling (as was previously reported) just yet. Other details about the phone, which will be unveiled tomorrow, are in-line with past reports. Separately, the WSJ observes Samsung spent $401M in 2012 on phone advertising in the U.S. (per Kantar Media), more than Apple's (AAPL) $333M.

    Three lunchtime reads:

    1) Bill Ackman on what makes a great investment

    2) Fed's bank stress tests make dubious assumptions

    3) Happiness is when Carl Icahn shows up

  84. AAPL / Dawn – I would be happy with $435. That 439 spike was the result of another rumor of a dividend… They will use that a couple of times I am sure until AAPL makes an official announcement of some sort!

  85. And tomorrow could be interesting for AAPL depending on that Galaxy S4 reception…

    And BTW, there are plenty of other great Android phones out there (from HTC, Motorola and others) but clearly Samsung has learned a great deal about marketing from Apple.

  86. white smoke…

  87. Phil – just sent you a chart via email 

  88. Oil at $92.60, Dollar 83.12 so just going in opposite directions at the moment.  Not doing much for gold – $1,587 – so far.  Copper stuck at $3.53, silver stuck at $28.91 but nat gas happy at $3.69 and you would think gasoline would be excited as they got the draw but can't get over $3.12, down from $3.18 before the inventory and that's strange – makes me think something shady was in that report.  

    Bass/Pharm – Very good point.  

    Gray smoke at the Vatican – What the Hell does that mean?  I know my phone didn't ring so I guess I've been passed over yet again.  Oh wait…. the phone!

    Cramer/Dawn – I wish I had known that.  It probably explains the morning sell-off.  

    AAPL/StJ – Rather than distributing $30Bn to investors, I'd much rather if they bought DELL ($25Bn) or HPQ ($41Bn) or BRCM ($20Bn) or CRUS ($1.5Bn)….  What's better for AAPL, giving me $30 once or picking up a company like BRCM that drops $1Bn per year down to the bottom line and gives them better control over vital components for future systems?  

  89. Until AAPL breaches to a higher high…it is rangebound (it is making higher lows but not yet higher highs to confirm it wants to go up)…toying with us

  90. On $DXY--I follow him too…good analysis on all commodities and metals daily
    Cramer/AAPL—I dont watch him…he gives me a freakin headache.  Think I saw the blurb on FINVIZ this morning under AAPL ticker

  91. Phil // PM
    This is exactly why I was writing, for words of experience on how to manage risk with PM. I have an almost identical portfolio in terms of style and value as the Income Port. Now, it's a mix of the old one and the new, but pretty risk averse. This is the only port I have PM activated. I'll read through what you sent.

  92. Ghost Cities in China? 60 minutes played that segment 2 weeks ago.

  93. Pharm/PGNX – off 6.5% today, more or less. I have a nominal position, that's up 2.5%.  B, S, or hold?

  94. China's going to replace ghost cities with real infrastructure projects.  Europe taught everyone [by not doing it] that stimulus works, that economics is really behavioral psychology — unless a comet has hit earth.  So has Bernanke, to his credit.  Buybuybuy.

  95. BRCM - speaking of, it's breaking north out of one of Phil's "triangle squeezy things" (magephone).  If the market doesn't dip soon and slow it down, could be a good dice roll, or at least Income Portfolio play.

  96. AAPL  Phil – Agree. To me, special dividends and buybacks are not that productive. Actually I posted an article about buybacks a while back that showed that they were doing more damage than anything as companies usually bought at the top… Then again, not much of a chance of that with AAPL now! For my money, QCOM would be a better choice with all the patents they own.

  97. Phil your comments re. WYNN well taken, however the stock has since gone up by 1.24 CZR by 1.75 now two hamburgers for me in AC,  LVS only .40 cents. Possible gamblers UNIT!!!!

  98. QCOM/ StJ: didn't you have a play for them after earnings?

  99. Phil / Procedural Q
    I have an April13 NAV 28/32 BLCS and short PUTS@20 /
    I also have been holding +500 shares  ( Fidelity still hasn't release my cost basis – jeez, but I think its around $35 )
    NAV just popped. This is a really typical setup for us, so what would you recommend to stay in the position for the long term, come April  >>>

  100. PGNX – we sold Aug 4 Cs yesterday on them.  Not worried.

  101. Phil—thx--went the /RB route instead of /CL—should have held on longer but some sushi for lunch is good

  102. Thanks, Pharm.

  103. 12:55 PM Priceline's (PCLN -0.5%) acquisition of Kayak (KYAK -0.2%) will delayed thanks to an extended review by U.K. antitrust regulators. The FTC has already signed off on the deal

  104. mrmocha // BRCM
    I'm sitting on both Jan15 30 and 28 short PUTS – if they break out over $35, then perhaps a BCS is in order, but I'd ask dawnr ; >

  105. Phil-Can you help me understand your thoughts on oil going down?  I am looking at the USO chart and price feels like it is in the middle of nowhere. Hesitant to take that $33.50 trade again as second visit to that area (I was taught third visit likely will break)
    $DXY is toppy (or close) so I am thinking USO can revisit 34.75-$35 area without breaking its current wedge.  Maybe too much time at my computer today…help

  106. OMG…the Vatican is on FIRE…  Oh, whew….just a new Pope….

  107. Overbought/Deano – I don't disagree – we could use some healthy consolidation here but I prefer these two and we're just not overbought enough to panic yet: 



    On the longer-term NYSI, notice how fast we became not overbought just on a slowdown in the rise in the markets.  That indicates that a real base is coming on fast to support these levels and, as you can see from the NYMO (shorter-term), just yesterday's little dip put us back to neutral. 

    If you'd like, I can find more squiggly lines for you to try to find meaning in….

    See, Dawn says AAPL is rangebound until they breach to a higher high while I say they are currently undervalued and will go higher on any day someone doesn't put out negative reports on them and that, whenever they do announce a new product that doesn't cannibalize the current ones – just take those expected earnings and multiply them by 10 and stick it right on AAPL's current market cap.  So an iWatch that makes them $5Bn would be good for a 10% bump in the stock – something like that.  AFTER that happens, I'm sure it WILL be very obvious on the charts that this WOULD HAVE BEEN the perfect time to buy. 

    PM/Wombat – It's fine to play with fire as long as you respect the fire.  

    Ghost Cities/Jfaw – Funny as China's empty city was one of the reasons we shorted FSLR back in 2008 – it's the site of their "world's largest 2,000-megawatt solar plant".  Since we knew Ordos was, well Ordos, we knew the run was BS.  See, all these dopey things I like to read pay off once in a while…

    LOL ZZ – Very Douglas Adams of you: "Europe taught everyone [by not doing it] that stimulus works,"

    BRCM/MrM – As I said, I'd certainly buy them with AAPL's money.  I agree they are a good price so let's just pick up the requite $4,000 by selling 10 2015 $30 puts for $3.60 ($3,600 actually) as a first poke at them for the Income Portfolio.  

    AAPL/StJ – I did do the math a while ago that AAPL could buy back it's own stock very effectively at this price but, as you say, there are certainly better things to do with money – like sit on it, which has worked out just great for Buffett for the last 50 years.  QCOM better but $114Bn so AAPL better off buying the smaller player and making some new patents of their own.  

    Wow on CZR.  Congrats Yodi – I will take you up on that Kobe Burger ($40 but worth it).  

  108. au revoir SGEN – and thanks again Pharm!

  109.  40$ that must be the price for the whole PSW group ???? Possible talking IN MX pesos

  110. Phil—did you have an X play? Should we be selling 2015 puts?

  111. NO no Deano….say it ain't so!

  112. Pharm – I'm up more than 100%, and fully covered now. Had to lock it in – sorry -

  113. Whew…that's ok then…..

  114. You Guys must have missed my BRCM play of 1/16
    Jan15 Bull call 28/35 @ 9.44/5.79 now 9.27/5.30
    sell Jan14 28p for 3.65 now 2.84
    sell 1/2 Mar 35c for .38 now .18
    OR 1/30
    Jan15 bull call 28/35 @ 8.98/ 5.28 now 9.27/5.30
    Sell jn15 28p for 3.40 nw 2.84
    same Mar play

  115. Sadly seeing AAPL up 1.55 and CZR up 1.29 makes you think!!!!!

  116. Here's a point I should make re. "overbought".  Overbought is not what most people think.  To work off an overbought condition, you don't need to get oversold, or even neutral.  Nor do you have to reprice down.  It's all about time.  In other words, if I was selling 1,000 bottles of water for $1 to 200 people who make $1 a day and have $1 on them and those people need half a bottle of water per day to live – then if 100 people bought water from me in one day, we would in no possible way be overbought, right?   But, if 100 people bought water on day one, then I've sold enough water for 200 people to drink and any more water sold that day makes me "overbought" as the market now has more water than it can drink in a day and I have half the money.  

    If I drop my price – I may get more people to buy water as it's a "bargain" but it doesn't change their overall need for water, does it?  So, on day two, I've sold 100 bottles for $100 and apparently everyone shared at there are still 200 people alive and they now have $300 total to spend but I'm a prick so I now put up a sign that says "Water $1.50 – only 100 bottles left" – now only the people who have $2 can buy my water today but those people have to share with the people who paid $1 yesterday and get $1 today otherwise the people who buy it today won't get any tomorrow and there's only 100 bottles to go around.  

    This game can go back and forth until we find a price equilibrium but it never means that water will come back to $1 – the overall market demands have shown me, the seller, that I can get more than $1 per bottle and all I have to do is hold on to my bottles until I get my price.  So any short-term, overbought condition can be worked off by simply pausing and waiting for the money to be replenished and there won't be any real downward pressure on prices unless I myself or some cartel I belong to, needs money fast and tries to sell more than 100 bottles a day.  

    Keep in mind that, with stocks, there is a constant and growing demand for stocks as they go into 401Ks on a regular basis.  More hires = more demand as well.   Stocks are not being created, they are being destroyed through buybacks and private takeovers so less supply out there and we're a long, long way from the kind of IPO mania that flooded the market with shares in the '00s – like GOOG's 300M shares, etc….

    NAV/Wombat – I take it that's a bull call spread?  They don't pay a dividend so I'd take the stock off the table and be very happy to make a nice whatever on the spread – especially if it's April and you get an instant winner – why risk any of it.  If it makes you feel better, sell the stock and sell 5 2015 $35 puts for $8.50 as that net's you back in with a better than 20% discount (so you are hedged) and you make another 20% if the stock simply doesn't go down.  What's the point of owning when that's the alternative?  

    Free sushi/Savi – Yummmmmmmmmmmmm…..

    Oil/Dawn – Great blue line cross $34 mean heap big trouble with strong red line traveling below $33.  Much wampum will be lost by white traders…  Seriously, do you just skim my posts when I talk about the fundamentals of oil and hear "blah, blah, blah"?

    There are still 133M barrels on order for April delivery and the contracts stop trading on Wednesday next week so any trader still holding a contact must take delivery and, since virtually NONE of those traders actually want's to have 1,000 barrels per contract parked in his living room, they have to roll or sell about 120,000 contracts in 5 days, which is 24,000 a day, which is doable but selling is out of the question at these inventory levels so they have to roll but rolling is expensive and there's already 263M barrels no one really wants jammed into May and summer driving season doesn't start until June, which already has 175Mb stacked up and – if the May holiday is a consumption bust – that first week of June could be one of the biggest oil corrections of all time.  

    THAT's why we're short on oil – I don't really give a crap where it is on the chart – other than the inventory chart, which shows 40Mb more oil in storage than last year in the middle of a cycle where oil usually builds up for the June driving season.  So, LOGICALLY (not chartilly), something has to give and it's not very likely that US Consumers all run out and buy millions of $90 barrels of oil and put them in the garage for safe-keeping so either they stop selling us oil as it spills out of the storage facilities (and that's difficult as a 3-month conga-line of ships is heading our way full of oil from all over the world) or they lower the price to hopefully spur demand a bit.  

    Oh, and did I mention that gasoline is still very expensive and it won't even help if they lower the price of oil if the refiners don't lower the price of gas but that it's not at all in the refiners' interest to lower the price of gas just because oil is cheaper.   This is why so many oil companies own refiners – they used to get burned like that all the time so they bought up most of the independents so they can flood the market with cheap gas and force prices down when they need to spur oil demand.  Unfortunately, this mechanism has not really been tested for 5 years and it may be broken as consumers have altered their driving habits so – interesting times ahead.  

    We'll really know more when we get another point on the chart – because THAT's how we should trade commodities!  

    Someone owes me $1Bn because Bono isn't Pope!  

    $40/Yodi – No Yodi, just the one burger.  But it does come with fries.  Gotta get them medium-rare though and most people don't and then they say "it's not worth it" – may as well order hot beer and complain it doesn't taste right…

    X/Jabob – I'd wait until we get into next week without falling.  Just because the US fundamentals look sound, doesn't mean we can't get rocked by our Global neighbors – especially with stocks like X.  That's why the RUT is leading the rally – much less overseas exposure.  

  117. AAPL lost $4 since the new pope was elected…. I guess he will have a new Galaxy S4 when he comes out!

  118. ccsincsd / NFLX – do you do shorter or longer term bear call spreads on volatile stocks, and do you go vertical or calendar?  For example, selling the JUN 250 C looks juicy and not terrifying, but what would you protect them with?

  119. Oh the little repeating cardinal is creepy! 

  120. Phil seeing you on the balcony, I did not know you speak Italian????

  121. Oil—Honestly, I stay away from oil mostly (so yes, i do only skim your oil chatter) because in part, I had a mentor who was a very successful oil trader who made boatloads running a fund in the 1980's…and he cautioned me to stay away until I am reallllly good at the wheel.  Rigged game moves quick, etc…or just trade something else. 

  122. Phil – Let me see if I get this oil stuff right.  You are Ginger.  Or is that us?  Now I am confused.

  123. Did the pope see his shadow? And what does that predict?

  124. Why is what the Pope is saying not important enough to translate?  They put subtitles under the Jersey Shore, for goodness sakes!   

    AAPL/StJ – I think he did say something about being concerned about margin compression with the new iPhone.   

    Italian/Yodi – I think that's why they passed me over.  I passed Latin volatilis bicolor but my Italian, ha bisogno di molto lavoro.

    Rigged/Dawn – I haven't said this in a while but I often say – we don't care IF a game is rigged as long as we can understand HOW it's rigged and go along for the ride.  

    Ginger/Grant – I was referring to my 3-day conversation in the posts on the fundamentals of why we're short oil at $93/93.50 range vs. what Dawn heard me saying.  I always did love that cartoon though – my old neighborhood was full of people who thought their dogs were geniuses.  

    Shadow/StJ – 6 more decades of Dogma is the prediction!  And, of course, whatever the Pope did say – he was absolutely and infallibly right.  This morning, he may have been wrong about something but not anymore – now he is "preserved from the possibility of error."  Maybe we should get him to pick a few stocks?  

  125. …that is why I am here trying to learn from you…to learn HOW it is rigged and how to benefit from it…otherwise I am shooting in the dark…I heard you correctly that you were short oil, I just did not understand why we are not worried about the inverse correlation with the dollar…honestly, I try to keep up with all the posts but there are hundreds…

  126. "… new pope … when he comes out!"
    Is he in the closet? ;-)

  127. I don't think Paddy Power takes reverse risk bets.  He's the House, remember!

  128. Phil – Now I get it.  Ginger Grant was on Gilligan's Island!  She was the movie star.

  129. Informational:   CSII     You may want to put this one on your radar.  This company makes orbital atherectomy devices used to clean out arteries in the peripheral vascular and coronary arteries.  I use it frequently.   It works.  Their stock is up significantly on good clinical reports.  Volume today 3 times usual.  I think this company will be bought out eventually by a larger medical device company.   Disclosure:   I do not own any stock or options in this company and do not plan to buy any in the next 72 hours. 

  130. To help you find that more easily, that's Cardiovascular Systems, Inc.    ( CSII ) 

  131. Record high on the Dow but volume nearly a record low with 52M shares with 8 mins to go.  

    That's OK Dawn, just bustin' on you, trying to get you out of some bad habits.  So yes, we think oil drops below $91 over the next week, maybe $87.50 if we get a nice dip but $90, of course, will be hard to bust.  Our premise may change if the NYMEX traders manage to pare off more barrels than we thought they could but we're watching (24Mbd expected rate) so we'll always know if they had a good or bad day.  I'm ALWAYS worried about the Dollar when trading commodities but the Dollar will do whatever it does – you can't compensate for everything in advance or you'll end up doing nothing all day but staring at charts and flitting from site to site looking for easy answers when, in fact, there aren't any.  

    Notice oil once again back to $92.50 but on the low side of that line today.  Transports up 1.67%.

    Whoever is in charge of the Dow is really showing off with these last-minute pins.  

    Good one Lflan!  Too bad you can drive a truck though those bid/ask spreads.  

  132. Lol, Iflan WTF?

  133. Iflan – while we are on it….have you seen Ra Medical's Excimer laser for PAD?  Any thoughts on the technology in general?

  134. thanks.  Just read the whole newsletter see much on oil…I only read the first unfinished draft in the morning and catch up later…duh, lots of my questions answered there.  ok, need to get away from charts clear my head.  until tomorrow!

  135. All indices end in the green and predictably, AAPL ends slightly red. Sigh….

  136. Pharmboy/RA Medical laser…….     I have no familiarity with that laser device in particular.  I do use the Spectranetics laser to remove thrombus and plaque from peripheral vessels.  It works well for certain applications, such as in-stent thrombus or soft plaque, not so well for calcific plaque (rotational atherectomy much better for this).  In general, laser has been shown to have limited usefulness in the peripheral vessels.  Although the word laser evokes magical thoughts in patients, there are much better modalities for dealing with peripheral vascular problems.  For instance, there are some exciting things being worked out right now using drug-eluting balloons and stents.  These hold much more promise than laser. 

  137. Ilfan – thx.  RA med is making a competitive product to Spectranetics, where the hand piece is much cheaper and they are giving away the laser for use….so, a cheaper alternative, that is also smaller in footprint than Spectranetics.  510k is filed, awaiting FDA clearance.

  138. 'giving away the laser' was the last time I heard, not sure what the new marketing ploy is at this juncture.  The med center would pay for upkeep and incidentals. 

  139. "chartilly" – "conga line of ships' – "wampum white man" // dude, you're on fire today.
    thanks for NAV guidance, consider it done.
    can you teach me to play with fire ?
    NFLX !!!!!

  140. By the way, for those of you who aspire to be TA people, this is a fun way to practice.  It's a game that takes historical charts of companies and let's you guess what the next move is.  

    Laser/Lflan – I'm waiting for tiny little plaque-eating nanobots

    Fire/Wombat – Very easily if you are willing to put ion the time it takes to learn.  Practice, practice, practice is the only way to get good at this stuff.  

    NFLX/Wombat – Patience.  If they hit $200, we get valuable information (whether or not they are rejected again) and, if not, we are lacking valuable information so I'd rather wait for a proper test than chase them around this channel between $175 and $195.  

  141. It is looking like a little breather now…

  142. It's just incredible how much of that stuff we store…

    And since we use less and less, we'll keep on stockpiling it I guess. Just to keep prices high at least!

  143. I know our good friend Paul Ryan wants to impose austerity measures because we have a spending problem. But whose fault is it (older article but facts are facts):

    And this estimate actually understates the extent to which Bush’s policies devastated the government’s revenue-raising capacity. In the postwar era, federal revenues have averaged 18.5 percent of GDP. They averaged 18.2 percent during Ronald Reagan’s 8 years and 19 percent under Bill Clinton’s 8 years, but 17.6 percent during George W. Bush’s 8 years and just 15.2 percent for Obama’s 4 years thus far.

  144. Phil—the Cramer/AAPL piece I mentioned earlier…such an ass

  145. And Cramer was pushing for AAPL to buy NFLX tonight… Some of his buddies must be long NFLX!

  146. Pharm:  "drug-eluting baloons."  Can you fill them with any drug you like?  Where, exactly, do you put them?  Perhaps I don't want to know.  All I can say is that my "Pharm" portfolio is up over 27% since Jan. 1 [10 weeks!!!], the damned thing is just "eluting money," and that's one drug I don't mind taking. Thank you, O Great Pharmacist in the Sky!!!

  147. Why would AAPL even want to buy NFLX? Is he joking?

  148. Phil, thank you. No need to apologize about the book, family has to come first! I just wanted to make sure I was putting my comments in the best spot as I would like to give back in any way possible. Cheers, 

  149. MrM / Spreads
    Sorry so late.  Because I'm in front of the charts every minute of everyday (that I work) I trade the weekly Bear Call Spreads and Bull Put Spreads.  I'm usually never out more than 8 days unless I had to roll something out of trouble.  I use the short term charts to time into the two spreads.  Never enter at the same time, never close at the same time.  Theta is always in my favor.
    When I like a long trade on the board, I sell a Bull Put Spread.  And vise-verse.  Typical is 10c's, $5 spread, credit $500-700, close it for $50-200, and I turn them over allot.  (TDA 1099 was over 240 pages long)
    What makes it work is that I like, and can, stare at the charts all day and that I get better everyday at reading the short term TA. (cheers to JRW … my TA hero.)  This is not for most that is for sure.
    Specific to your question.  Just my opinion.  Going out 3 months is trading, not investing, and there are too many fundamentals that can bite you.  Much less so going out 5-10 days.  But I love the 2014 and 15 plays as that is "investing" of which we are using fundy's and not TA for those.  I love the BCS's with a short Put on stocks we "want to own".  I love the 5-10x leverage on a $1,000 risk.  Of course I'm not going to get put a stock, I'm going to keep rolling it down till it expires or pops and I cash the trailing BCS.
    Thanks for asking.  Good to post as I don't do much.

  150. ccsincsd – i like it.. thanks!

  151. Good morning!

    Futures up a bit as Asia makes a very sharp turn back up.  

    Nikkei blasting back to 12,450 (up 200) and Hang Seng flat but that's 300 points up from the open as US Retail Sales makes everyone a little happier.  

    Even copper (HG) is finally moving back up ($3.543), silver $28.90, gold $1,587, oil $92.85 (also just shot up .50), nat gas flying at $3.696 ahead of their inventories (10:30) and gasoline $3.144.   

    I've been thinking about gold and a lot of the decline in gold over the past 6 months can likely be attributed to the 20% decline in the VIX.  Not the VIX, per se, but the concept of fear coming out of the markets and gold has several purposes, one of which is a fear trade – more like fear of war, fear of crisis than fear of a market dropping but the concepts are, obviously, tied together.  Once the fear premium is wrung out of gold, you have what gold usually is, a pure inflation play with a fear kicker – I still think that makes it a good long-term hold looking at all this Global inflation fighting that, ultimately, doesn't seem to work.

    People forget how drastically Volcker (Aug '79 to Aug '87) had to act to reign in inflation once it started and it took years to get things under control.  

    It took about 3 years of DRASTIC Fed action to get inflation down from 15% to 3% and, since then, 3% has been about "normal" for inflation.  I remember Ford came into office (never elected, of course – in fact, only about 300,000 people in Michigan ever voted for him at all) with those WIN buttons ("Whip Inflation Now") and that was late 1974, with the worst of inflation still 5 years down the road.  

    That was back when I started working and if you didn't get a 10% raise after a year working somewhere, you would quit that crappy job and go get another one.  I remember when we used to actually compare raises and (and this will blow your minds kids) bonuses – as it used to be a given that you would get both in almost any kind of job.  

    When Ford took office, the Vietnam war was winding down and the S&P was at 68, Carter took over in Jan 77 at 98, Reagan Jan 81 at 136, Bush the 1st Jan 89 at 294, Clinton Jan 93 at 451 and then all hell broke loose and he turner the S&P over to Bush the 2nd at 1,160 and Bush gave the market to Obama in Jan 2009 at 825.  Reagan's 2nd term through Bush the 1st was our last real round of inflation and, of course, no President ever had more jobs created than Bill Clinton but there was no inflation caused by record US employment – it's war spending and debt spending that causes inflation but we have wages flat or deflating recently (10 years) and that HAS BEEN artificially keeping inflation down.  

    Obviously, the debt spending is not ending any time soon but the wage deflation is already ending and that means inflation is right around the corner.  Inflation is more money chasing the same amount of goods and services.   The money is already in the banks and on Corporate balance sheets.  Once the banks start lending the money to home-buyers again, then they drop a $300,000 block of cash into the economy (in exchange for a 30-year note) and let's say they do that 1M times more than they did the year before.  That's $300Bn pushed into circulation in one year.  If companies hire 250,000 people a month for $40,000 jobs, that's 3M a year and another $120Bn pushed into circulation.  

    Then companies need to put those 3M employees into desks and buy them computers and pay for their internet connections, etc – and figure that's going to be 2x labor cost (labor is usually 30% of spending) so another $240Bn there and if Government Spending stops being a negative drag on things – that's another $100Bn easily so just those very conservative numbers drop $760Bn into the economy in a single year and that's 5% of our GDP folks!  

    So 5% more money chasing the same goods and services (it takes time for all those factories to be built and for those new hires to get productive) and that makes inflation mathematically inevitable.  

    Also, it's unemployment day and the usual 350,000 people will lose jobs (what matters is how many people GET jobs) and that number remains higher than it would be as more and more people are switching jobs now (trading up) so they WANT to leave their old job.  I came across this chart this morning and think about the significance of us crossing back over that zero line over the next 12 months:

    Oil back at $93 again while I was writing that as the Dollar calms back down to 83.15 and under 83.25 is OK now as we've gotten used to over 83 this week (moving Dollar only has short-term effect on Markets).  Oil not likely to be a great short until after Nat Gas report (hope springs eternal at the NYMEX) but, if you are aggressive, the $93 line is always good with tight stops on /CL.  

    Thursday's economic calendar:

    8:30 Producer Price Index

    8:30 Initial Jobless Claims

    8:30 Current Account

    9:45 Bloomberg Consumer Comfort Index

    10:30 EIA Natural Gas Inventory

    1:00 PM Results of $13B, 30-Year Note Auction

    4:30 PM Money Supply

    4:30 PM Fed Balance Sheet

    Speaking of jobs:  A big jobs number out of Australia sends the aussie (FXA) to its highest level in 6 weeks, +0.8% to $1.0378. The country added 71.5K jobs in February, far greater than the 10K expected. The unemployment rate held steady at 5.4% vs. forecasts for 5.5%. The dashing of rate cut expectations is hitting shares (EWA), the ASX 200-0.8%.

    China's National People's Congress formally elects Xi Jinping as the country's new President after he was appointed Communist Party chief in November. The Congress also chose Li Yuanchao, who's seen as somewhat of reformer, as VP. The rubber-stamping is due to continue tomorrow, when Vice Premier Li Keqiang is set to be officially named as Premier Wen Jiabao's successor.

    As expected, Japan's lower house has authorized the appointment of Haruhiko Kuroda as the new Governor of the Bank of Japan, and Kikuo Iwata and Hiroshi Nakaso as Kuroda's deputies. A biggish test is set to come tomorrow in a vote in the upper house, where the government will need help from the opposition to gain approval for the three men. They should receive it, although it's not 100% certain Iwata will be authorized.

    Japan cuts its January industrial production reading to +0.3% M/M from a prior estimate of +1% and vs +2.4% in December. Analysts had expected zero growth in January. On year, production -5.8%. (PR)

    India's wholesale price index, the country's main gauge of inflation, rose 6.84% on year in February vs +6.62% in January and vs consensus of +6.6% as fuel prices spiked 10.5%. CPI +10.9%. The increasing inflation makes it less likely that the Reserve Bank of India will cut interest rates when it meets on Tuesday next week.

    Fast buying up every single-family home it can get its hands on, Blackstone (BX) is reportedly prepping the first ever securitization of REO-to-rental properties. The news follows Deutsche Bank upping to $2.1B from $600M a loan to Blackstone allowing it to buy even more homes.

    Just in time to boost oil prices into the rollover!  A barge and a Chevron (CVX) pipeline are on fire and an oil slick is visible in the waters of a bayou south of New Orleans after a tug pushing the barge crashed into the pipeline last night. CVX says it has shut in the pipeline, products are being rerouted, and it has mobilized emergency crews to help with the response.

    Exxon Mobil (XOM) envisions North America as an energy exporter by ~2025, as oil and natural gas output rises 45% by 2040 while U.S. energy consumption drops ~5% thanks to transportation efficiency gains. Increased reliance on natural gas and renewables such as wind will lead to a 25% reduction in carbon emissions by 2040 to the lowest levels since the 1970s.

    The oil industry is increasing spending on research it hopes will make it cheaper and easier to coax more crude and natural gas from shale formations and deep-sea oil fields. [HAL]], SLB and BHIraised their R&D budgets 24% from 2010 to a combined $2.1B in 2012. Small improvements in drilling tools and fracking techniques could boost profits for oilfield firms and provide more energy for global markets.

    Without much fanfare, IBM (IBM +0.6%) is making fresh all-time highs. Big Blue, which raised its analytics/big data sales forecast two weeks ago, currently trades at 12.6x 2013E EPS.

    MEMC's (WFR -13.4%soft guidance and a report the Wuxi, China government will take control of Suntech (STP -23.6%) ignited a solar selloff (TAN -5%). LDK (LDK -12.7%), whose financial positionis arguably only a little better than Suntech's, was especially hard-hit, but ReneSola (SOL -5.3%), Yingli (YGE -3.4%), Trina (TSL -3.5%), SunPower (SPWR -2.7%), and First Solar (FSLR -2%) also saw losses.

    Some Facebook (FB) news: 1) Facebook's Timeline has been updated to place a greater emphasis on third-party apps. The update comes a week after a news feed revamp that will allow apps to stand out more, and 3 days after Reuters took a look at how the popularity of Facebook's apps can quickly rise and fall thanks to policy and algorithm changes. 2) News feed product manager states Facebook plans to keep it simple when it comes to mobile ad formats – no push notification, QR code, or GPS-based ads for now.

    China Mobile (CHL): Q4 net profit +6.1% to 36B yuan ($5.79B) vs consensus of 32.3B yuan. Revenue +5.3% to 151.8B yuan vs 150.4B yuan. Wireless data revenue +54% in 2012, and becomes "a major driver of operating revenue growth." App store users and downloads "dramatically" increase. To boost capex 49% to 190.2B yuan in 2013 as it builds its 4G network. (PR)

    BlackBerry (BBRY+2.4% AH, adding to the 8.2% gain it saw in regular trading on news of a 1M-unit BB10 phone order(perhaps from AT&T or Verizon?). Wells Fargo says it's now more comfortable with its forecast for 2.5M May quarter BB10 shipments. FQ4 (Feb. quarter) results arrive on March 28.

    Samsung (SSNLF.PK) is due to unveil the Galaxy 4S in New York today following a marketing blitz that analysts fear may have over-hyped the device and set it up to disappoint. Still, sales of 10M units are expected in the first month alone. The company is thought to have worked hard to avoid the supply the problems that cost it 2M units of lost sales in just one month last year after it launched the S III in May. 

    In a rare move for an Apple (AAPL) exec, marketing chief Phil Schiller is trashing Android (GOOG) ahead of tomorrow's Samsung Galaxy S IV event. Schiller takes aim at Android's fragmentation, noting only 16% of users (per Google's data) are on Android 4.1 (Jelly Bean), and claims (citing Apple's internal data) 4x as many smartphone users switched from Android to the iPhone in Q4 than vice versa. Is Schiller just being candid, or does Apple now think Android's rise demands a more aggressive marketing stance?

    "I am an entrepreneur at heart and now is the right time for me to start a new chapter within Google (GOOG)," writes Andy Rubin in a memo about his departure from the Android team. Rubin adds he remains "passionate about the power of a simple idea and a shared goal — an open source platform freely available to everyone — to transform computing for people everywhere." Any chance he's put in charge of Google Glass?

  152. What did I tell you?  Out of Control – New Report Exposes JPMorgan Chase as Mostly a Criminal Enterprise:

    As an excellent preview for the Friday fireworks, I urge you to read an astonishing new report, which I’ve embedded below, from analyst Josh Rosner of Graham-Fisher and Co. The best way to describe the report, “JPM – Out of Control,” is that it reads like a rap sheet. Notably, Rosner takes mortgage abuses almost entirely out of the equation, and yet still manages to fill a 45-page report with documented case after documented case of serious fraud and abuse, most of which JPM has already admitted to (at least in the sense of reaching a settlement; given out captured regulatory structure the end result is invariably a settlement with the “neither admit nor deny wrongdoing” boilerplate appended). Rosner writes, “we could not find another ‘systemically important’ domestic bank that has recently been subject to as many public, non-mortgage related, regulatory actions or consent orders.”

    The sheer litany of illegal activities just overwhelms you. And these are only the ones where the company has entered into settlements or been sanctioned; it doesn’t even include ongoing investigations into things like Libor, illegally concealing inclusions of mortgage-backed securities in employer funds (another ERISA violation), the Fail Whale trades, and especially putback suits for mortgages, where a recent ruling by Judge Jed Rakoff has seriously increased exposure. While the risks are still very much alive and will continue to weigh on the firm, ultimately shareholders will pay, certainly not executives as long as the no-prosecutions standard holds.

  153. Big Chart – Volume dropping is not a good sign.  If it were bullish consolidation there would be a lot of buyers hitting sellers at these goal lines and then we'd hold the line until the sellers exhaust themselves.  If you see volume tapering off it means the buyers have lost interest at these levels (we have, right?) and then it's a matter of time before a selling catalyst hits and we find no buyers are around (exhausted) and wheeeeee!, down we go.  

    Of course, we don't make conclusions off one or two days of observations, but that's what we do need to watch out for. 

    Oil/StJ – Good chart.  20% over average storage.  Also, I'm not sure we can physically store much more oil than this.  

    Austerity/StJ – Krugman weighed in on that yesterday as well.  


    So you might have expected austerians to change their minds, or at least to come up with other justifications. But no. Both David Cameron and Paul Ryanare still preaching that old expansionary austerity religion, confidence fairy and all.

    This is, by the way, a fairly big deal for the Ryan budget, which actually produces a lot of front-loaded austerity, in part because it keeps the tax hikes that finance Obamacare while cancelling the Medicaid expansion and exchange subsidies. The result would be a lot of fiscal drag in 2014 and 2015 — years when the U.S. is very likely still to be in a liquidity trap, so multipliers will be large. This particular “Path to Prosperity” is, in the short to medium term, very much a path to continued depression.

    Do the Reps really not understand what they are doing or do they WANT the US to fail?  It's almost harder to believe they can be so completely blind to the facts in front of their face than it is to believe they are just evil. 

    Cramer/Dawn – I can't say I disagree with the premise that, if AAPL continues to go down the drain, you don't want to be one of their suppliers either but, of course, the whole thing is silly as AAPL continues to sell more and more devices and place more and more orders with their suppliers.  

    One thing I haven't mentioned, because I can't really talk about it, is that some of AAPL's cutbacks to certain suppliers may be punishment for what they consider the sharing of their IP with their competitors.  Not to be specific but if AAPL feels that some design (or production process) improvement they suggested to a manufacturer is now showing up in other people's devices – they might get a bit miffed and pull the plug and move on to a new supplier.  The overall intent is to, without putting things on paper – send a clear message that you do not screw with AAPL.  I think their biggest regret at the moment is letting those IPhone designs go to so many people that they can't put the genie back in the bottle (as mixed results from patent suits clearly show).  

    I think their next major innovation will come from a very tight circle of suppliers or it's possible that we will see AAPL moving to buy up a few suppliers down the road.  We'll have to see which way they go with their next cash announcement.  

    Eluting/ZZ – Very nice. 

    NFLX/Jabob, StJ – What a joke.  AAPL, with a p/e of 8 at $400Bn, would buy NFLX for $12Bn with a p/e of 650, which would immediately drop the value of NFLX's earnings to about $150M in cap (1/80th) and AAPL would take an $11.85Bn hit in order to acquire $17M in profits (about what they make in an hour).  For Cramer to even suggest this he should be banned from the Financial Universe.  

    Thanks BDon – I do plan to get back on track with the book this weekend.  

    "Fundamentals that can bite you"/CCS – LOL, I guess that's the other side of the game!  8)  

  154. Nice little drop to $92.50 on oil already (+$500).  The .50 line is much more dangerous to play than the $93 line, of course as it SHOULD be bouncy – especially on pre-market, low-volume trading.  

    Dollar 83.285 keeping a lid on things.  

    Gasoline (/RB) back to $3.1169 and if we can catch $3.11, that's going to be a fun play into the weekend, so let's keep an eye on them.  

  155. Good Morning
    not snoozing today
    not a Catholic but really liked the first impression of the newly elected Pope—-got a nice feeling about him
    anyway will definitely watch /RB

  156. I just tweeted taking the money and running on oil at $92.15 – no sense in being greedy – we have all day to trade it.  

  157. 5:10 AM Asian and European stocks are higher, helped by better-than-expected retail sales in the U.S. and as European leaders convene in Brussels for a two-day summit. The gains could set the basis for the S&P to make a fresh challenge on its all-time high later, and for the Dow to continue its record run. Japan +1.2%, Hong Kong+0.3%, China +0.3%, India +1%. EU Stoxx 50 +1%, London +0.4%, Paris +0.7%, Frankfurt +0.8%, Milan +1.3%, Madrid +1.1%.

    6:00 AM Overseas: Japan +1.16%. Hong Kong +0.28%. China+0.28%. India +1.07%. London +0.27%. Paris +0.61%. Frankfurt+0.74%.

    Dow Theorist (and Uber Bear) Richard Russell Flips Bullish (MarketBeat)

    Do economic fundamentals underpin peak equities? (

    Visualizing Bob Farrell’s 10 Investing Rules (streettalklive)

    GOLDMAN(GS): The Private Equity World Is Shrinking.

    Cameron Ignores ‘Rubbish’ Stories, Focusing on EconomyPrime Minister David Cameron, speaking after three weeks of reports of lawmakers questioning his leadership, said he ignores such “rubbish” and is focusing on securing the U.K.’s international economic competitiveness. Cameron saw the U.K.’s top credit rating downgraded last month and his party, already behind in the polls for a year, was pushed into third place in a special election, stoking criticism of his leadership. Following Cabinet revolts over spending plans and alcohol pricing, he hit back last night, saying his Tory party and voters need to concentrate on the longer-term goal of restoring economic growth.

    Germany intends to cut 2014 spending by €5B to €300B and balance its budget by 2015, a year ahead of schedule. Germany brought forward publication of its plans to before an EU summit today, when France and Italy may lead the charge for a relaxation of austerity. Germany wants to make the point that "consistent sustainable budgeting and growth are not mutually exclusive."

    Latest Greek Aid Tranche To Be Delayed After Troika Talks Break Down.

    A Short History of Austerity: It Almost Never Works (The Guardian)

    Very good read:  The Annotated Guide to Krugman versus Sachs (Economist’s View)

    China Money-Market Rate Rises as Zhou Signals Inflation Concern. China’s money-market rate rose to a one-week high after central bank Governor Zhou Xiaochuan said yesterday the nation should be on “high alert” over inflation. “The PBOC is still withdrawing liquidity” said Weisheng He, a Shanghai-based strategist at Citigroup Inc. “The authorities are somewhat concerned about rapid monetary growth.” The seven-day repo rate, which measures interbank funding availability, climbed six basis points, or 0.06 percentage point, to 3.08 percent as of 10:45 a.m. in Shanghai, according to a weighted average compiled by the National Interbank Funding Center.

    Gold is the worst investment of 2013 (Quartz)

    Industrial Metals Retreat Amid Tightening Concerns in China

    Rebar Tumbles to Lowest in Three Months After Iron Ore Slumps

    Rubber Drops to Lowest in Three Months on Malaysian Exports, Yen.

    CFTC Investigating London Gold, Silver Price Fixing For Manipulation.

    Brazil Real Drops on Speculation Credit Rating May Be LoweredBrazil’s real declined, giving up earlier gains, on speculation among traders that the nation’s credit rating may be lowered. Credit-default swaps for Brazil rose while the benchmark stock index fell for a second day and interest-rate swaps jumped to an eight-month high. The real slid 0.4 percent to 1.9721 per dollar. It earlier advanced as much as 0.3 percent.

    S&P cuts Puerto Rico GO rating to near-junk status

    American's seem to be on the move again after staying put because of the housing bust and wider recession, with a census report showing that the 50 fastest-growing metropolitan areas last year were in the West, the South, or in energy boom states such as North Dakota. "There is the beginning of a shift back to the Sunbelt," says demographer William Frey. "Many Snowbelt movers who were frozen in place are now moving to South and West metropolitan areas."

    Who could have foreseen that? Financial irregularities killed Intrade  (New Yorker)

    Stephen Gandel nails Why Intrade Failed (Fortune)

    The SEC has said that JPMorgan (JPM), Bank of America (BAC) and Morgan Stanley (MS), as well as Citigroup (C), don't have to hold votes at their annual meetings on motions that would require them to consider "extraordinary transactions," including being broken up. The proposals came from labor and religious groups, with a motion from the AFL-CIO, for example, saying that JPM's $6B whaling loss had shown that it had become too big to manage.

    Dallas Fed Cap Seen Shrinking U.S. Banking Units by HalfA proposal by the Federal Reserve Bank of Dallas to limit government support for banks could force JPMorgan Chase & Co. (JPM) and Bank of America Corp. to shrink their U.S. consumer and commercial-lending units by more than half. The plan would cap assets at deposit-insured divisions of the largest U.S. financial firms at about $250 billion and wall off investment banking from traditional lending, Dallas Fed Executive Vice President Harvey Rosenblum said in an interview. The limit is needed to allow the Federal Deposit Insurance Corp. to shut a failed bank without using taxpayer funds, he said.

    Fed Gets Ready to Judge Big Bank Plans to Redistribute CashThe Federal Reserve plans to unveil Thursday afternoon the results of its review of bank plans for their piles of cash — from mergers to dividends and stock buybacks.  - Gee, how about LENDING it to consumers so they can refinance their homes at lower rates???

    Unleash the Socialists!  Cities across the country, such as Boulder in Colorado, Minneapolis and Santa Fe, are exploring the option of taking over theprovision of electricity from private utilities. Reasons include cities wanting clean-tech to play a greater part in power generation, and the ability to respond to disruptions. Xcel Energy's (XEL) unit in Boulder is among the companies affected.

    Transports: On the Road Again (Dr. Ed’s Blog)

    I love this one:  US teenager crafts early detection tool for cancer (global post)

    Vodafone (VOD) and France Telecom's (FTE) Orange unitplan to invest €1B in a fiber-optic cable broadband network in Spain, indicating that the country's fixed-line Internet market is an area of growth despite its dire economic situation, which has caused Vodafone to write off off over £16B since 2010. The company's investment appears to be part of a strategy to move into the the fixed-line sector across Europe.

    JPMorgan downgrades Amazon (AMZN) to a Neutral rating from Overweight and lowers its price target to $300. The firm drops its estimates for 2013-2014 revenue and gross profit projections by 1% and 3%, respectively. 

    More on JPMorgan's downgrade of Amazon (AMZN): The firm says its bottom-up analysis on Amazon suggests decelerating gross profit growth in 2013. In addition, 2014 EPS is taken down to $2.83/share from $3.01/share. AMZN -1.7% premarket.

    Apple’s plan for its cash: stock buyback or more dividends likely coming this spring (Quartz)

    Very interesting point:  Android Owners Aren’t Real Smartphone Owners (Business Insider)

    How Apple Gets All the Good Apps (WSJ)

    11 Hot Republicans To Watch At This Year's Biggest Conservative Summit.

    Is Paul Ryan an Inflation Nutter? (Bloomberg)

    Paul Ryan’s make-believe budget (The Washington Post)

    Blessings of Low Taxes Remain Unproved (NYT)

    Don’t fall for Pentagon spin (Salon

    Pentagon needs $12.6 billion per year through 2037 for F-35 (Yahoo Finance)

    I love looking at this chart while listening to people on CNBC telling us that the rally is over.  People really have no sense of history/perspective when it comes to investing – much to their detriment.  

  158. cc great post.  i am in your boat watch charts all day or reading learning learning watching price action. i sleep bettwr at night in and out of trades in short order as i found i was up around the clock watching asia open, asia news, london open, etc…that is why i do not trade fx much anymore because i could never turn it off!  

  159. Is stp completely done?