KO disappointed.
It's not good when Coca-Cola misses revenues. It's usually an indication that the consumer is really hurting. Net Income fell to .59 for the quarter, down from .61 last year but it was the 3% drop in Revenue that was surprisingly light, leading CEO Muhtar Kent (a straight-shooter – see my 2010 interview) to state he "was not happy with our performance." The beverage maker cited "a challenging global macroeconomic environment" and bad weather for its performance.
Rather than shorting KO, we're shorting oil this morning and I sent out a tweet early this morning, identifying a shorting opportuntiy on /CL Oil Futures at $106.45 but we stopped out of those at $106.50 and now we're looking at the $107 line as our next shorting target, waiting for the big drop we are fairly positive is going to come as we head into the NYMEX contract rollover next Monday. I'm not going to get into it again (see last few weeks of posts) but the bottom line is they have faked way too many orders for September and now they have just 5 sessions to cancel or roll 130,000 contracts, about 25,000 contracts per session and, yesterday, they only managed to get rid of 13,000 – that does not bode well for the NYMEX Fraudsters.
|
Click for
Chart |
Current Session | Prior Day | Opt's | ||||||||
| Open | High | Low | Last | Time | Set | Chg | Vol | Set | Op Int | ||
| Aug'13 | 106.44 | 106.74 | 105.91 | 106.47 |
05:23 Jul 16 |
– |
0.15 | 16473 | 106.32 | 138979 | Call Put |
| Sep'13 | 105.96 | 106.24 | 105.46 | 106.05 |
05:23 Jul 16 |
– |
0.13 | 6807 | 105.92 | 336220 | Call Put |
| Oct'13 | 104.64 | 104.80 | 104.11 | 104.66 |
05:23 Jul 16 |
– |
0.17 | 1101 | 104.49 | 125043 | Call Put |
| Nov'13 | 103.20 | 103.20 | 102.75 | 103.06 |
05:23 Jul 16 |
– |
0.07 | 561 | 102.99 | 74312 | Call Put |
| Dec'13 | 101.63 | 101.82 | 101.16 | 101.77 |
05:23 Jul 16 |
– |
0.21 | 1132 | 101.56 | 211463 | Call Put |
By next Monday, all but maybe 15,000 of those contract (1,000 barrels per contract) will disappear. This will create an artificial shortage of oil in August as no orders mean no deliveries and no deliveries mean inventories will be drawn down, whether demand is actually there or not. We'll watch this crime in action this week as NYMEX Terrorists threaten our Nation's energy security by tearing up oil contracts (that are already approved for delivery), choking off the supply of oil to our great nation and extorting Billions of excess Dollars from US Consumers at the pump, in the Airlines and to heat, cool and power their homes and businesses.
As usual, our leaders will do nothing.
No wait, I take it back. As usual, our leaders will collect another $30M in bribes from the Koch Brothers. That's the Koch's average annual spending to buy better themselves better Government. It's only a sliver of their $50Bn fortune (50,000 Million and, as you can see from the chart on the left – they sure get their money's worth) but there's only 435 Members of the House of Representatives and 100 Senators and $30M/535 is still $56,000 per Congressman from the Koch brothers alone. Given that about half of those Congresspeople are Democrats, who generally get $0 from the Kochs – we're into 6-figure pay-offs to the average Republican.
In fact, according to the Kochs, those bribes alone makes their Republican cronies 3x richer than the top 1% (I kid you not, this is their actual video explaining it):
That's right you "poor" people – suck it up, you're 10 TIMES richer than people who are REALLY poor so stop your whining and vote to end that minimum wage so you can compete fairly with people making $2.50 a day in China!
According to the Koch Brothers, making $34,000 a year for a family of 4 puts you in the Global Top 1% – so your interests and their interests are perfectly aligned! If this is the kick-off to the 2014 mid-term election strategy for the GOP, I know a lot of Democratic strategists who will be having a party this weekend!
The GOP is convinced they are going to take back the Senate next November because Americans are sick and tired of getting JOBS and having PEACE and PROSPERITY, with a stock market that is now up 200% since finally getting rid of George Bush II in 2009. We don't want those high-mileage cars or roads without potholes to drive them on. We want FREEly poluted water and air that you can cut with a knife – just like China!
That's how we compete globally in the Koch Brothers Fantasy Camp – drop US wages to be on-par with the rest of the World (10% of what we make now on average), stop taxing Corporations and Wealthy Individuals (like the Kochs) and let those Corporations do what they want (as if they don't already).
If you aren't for those things – you are a Godless, Anti-American Communist who should stop voting and leave the country (where the new immigration laws will prevent you from coming back).
Speaking of Godless Communists, China financial instability du jour is an 800% increase in WMPs, or "Wealth Management Products" where over $1Tn of Chinese savings (the size of Australia's total economy) is now in instruments that are, essentially, Ponzi schemes, where the investor puts in money for "guaranteed" 1% WEEKLY returns.
As investors pile in, financial firms need more inflows of cash to pay off maturing products, resulting in mounting risks that prompted China Securities Regulatory Commission Chairman Xiao Gang to call them a “Ponzi scheme” even before the latest record purchases. Issuance of new products and borrowing from the interbank market are among the most common ways banks pay out maturing WMPs, according to Fitch.
“The WMP market has inflated to a huge size,” said Wilson Li, a Shenzhen-based analyst at Guotai Junan Securities Co. “Should they go bust, Chinese banks have their reputation on the line, and they face the risk of compensating investors because of pressure from the general public.” A record 1,137 WMPs were sold by about 70 banks in the two weeks ended June 28, an increase of almost 50 percent from the first two weeks of the month, according to Benefit Wealth, a Chengdu, China-based consulting firm that tracks the data back to 2007.
“In an environment where liquidity is tight, banks will find it more and more difficult to attract fresh money to keep the game going,” said May Yan, a bank analyst at Barclays Plc in Hong Kong. “Until investors are hit by a real default, they won’t understand what they are really buying into.
Our June CPI was 20% too strong (up 0.5% for the month) and our Chain Store Sales were 20% too weak (up 3% from last year vs. up 3.6% last week) and Retail Store Sales were DOWN 1.1% for the week vs +3% last week and that's dropped the annual run rate from +2.9% to +1.7% on this week's total disaster as people's disposable income goes into the gas tank – THIS IS NOT COMPLICATED FOLKS!!!
The American consumer is at the end of their rope and it's not like Europeans or Asians or Emerging Marketeers are carrying the consumer ball for the Global Economy. Corporations are not spending and the Fed is telling them that, IF they hire, THEN the Fed will cut off the Free Money. So, surprise, surprise – THEY'RE NOT HIRING! Again, not complicated – very simply cause and effect all around.
On the bright side, Goldman Sachs DOUBLED their profits to $1.93Bn as endless supplies of Free Fed Money was converted into incredible trading gains on the stocks, currencies and commodities they manipulate – accounting for $2.46Bn of the bank's Revenues. Oh, and please, please, PLEASE do not bee fooled by "just $1.93Bn" in profits for GS – that's AFTER they distributed $3.7Bn to compensate their employees (32,000, so $1M each if distributed evenly, which it's not!) through bonuses on the $1.93Bn the company allowed to trickle down to their stocksuckersholders.
Don't bother sending this article to your Congressman if you want things to change – send them a check instead – that's how the Koch brothers get things done!
Vegas – I'm in and recruiting – Savi – do you need an email?
WHOAMI/ The only thing I know is you are not Jabobeast! and where is he when you need him?
Vegas Recruiting/Deano – Yes, we don't really have an upper limit, Caesar's will be happy to give us a bigger space and more food as we're using a weekend – which they love. In fact, if we fill this year, next year maybe we do a bigger one and allow the public to come for huge amounts of money to subsidize what the Members pay!
Was just looking at what I said Friday about TSLA and, based on this comment alone – people should come see me in Vegas just for the psychic readings:
Jabob/Winston – LOL, was it really only yesterday when I blasted him in the morning Alert (and the post, for that matter) and he said:
As I'm sure you guys know, I've been telling him NOT to short PCLN for ages and we're still waiting for NFLX to get real but, on the whole, I think I can now say (30 hours later) – I told you so!!! 😎
Phil: TSLA
shocking to see it drop like that, kind of like the roadway halfway down our mountain today. This where we spend the summers
http://www.wsoctv.com/news/news/local/mudslide-destroys-part-highway-avery-co/nYrsF/
Hi Phil. If I have some shares of apple I bought today at around $428 what calls would you sell to protect? Got out of tsla today. Shorted at $124 and watched it go to $132 and had a heart attack. Covered at $123 so missed the big drop but at least I will sleep ok. What a crazy stock. I have a friend who owns one and she practically wanted to strangle me when I told her stock was overvalued. She kept saying Elon was going to save the world. Really annoying
I doubt that I feel anything more than normal skepticism toward your run-of-the-mill conspiracy hypothesis, simply because most humans can barely set their watches to the same time and keeps their mouths shut, much less conspire on a global scale regarding anything at all. There is always a powerful incentive to profit by being the whistle blower, for one thing. Gold specie, plus mining stocks — China, Germany, Brazil, South Africa, Bernanke and Putin — all working together to drive gold down? It doesn't sound right, somehow.
Been away the entire day but we are still not getting the down day we need on the indices!
Car sales are going in the opposite directions in Europe and the US:
http://www.bespokeinvest.com/thinkbig/2013/7/16/us-and-european-auto-sales-are-oceans-apart.html
Sears – Interesting article on how Lampert applied Ayn Rand principles to Sears, believing it would spark healthy innovation. Instead it bred a culture of conflict and backstabbing (who knew that would happen when you encourage people to act selfish for the good of all?)
LV Note—-please e-mail me directly if you are commiting or have questions –I am in and out on the site during the day and I miss some of the comments –thx
atm count 8 (incl deano) with 2 pending
Phil—way to get it back!!
I have been waiing impatiently, of course 😉
http://i.qkme.me/35do3d.jpg
Elon/cturb – save the world!? Hah! ask your friend if he is going to save it, why is he trying to get OFF the planet and go to Mars (on a one way trip!)? Also piont out he has no kids.. hardly shows he has much commitment to mother Earth. LOL!
Having expressed my doubts about a "gold conspiracy" earlier, it is only fair that I reproduce this item that appeared in the Times this evening:
Patrick Hosking Financial Editor
Published at 12:00AM, July 17 2013
"A suspected attempt by City traders to rig the Bank of England’s flagship policy to stimulate the economy has been under investigation for almost two years, it emerged yesterday.
Paul Fisher, the director of markets at the Bank, told MPs that details of a “reprehensible” attempt to manipulate the government bond market had been passed on to regulators.
The affair was looked at initially by the Financial Services Authority and continues to be under investigation by the Financial Conduct Authority, it is understood.
Officials believe that traders tried improperly to push up the price of a particular gilt in October"
And this, from FT: oh dear:
"The US electricity market’s overseer has slapped Barclays with a record $470m penalty over manipulating power prices, in the latest heavy regulatory sanction against the UK bank.
The Federal Energy Regulatory Commission’s fines matched the amount proposed last year when it accused four former Barclays traders of manipulating physical power prices in California and other western US states in order to fraudulently boost financial derivative positions."
Finally — inflation/deflation: Given that the Chinese are executing shadow bankers, it may be that their authorities are actually serious about limiting inflation: http://www.bloomberg.com/news/2013-07-16/-shadow-banker-execution-turns-chinese-sentimental.html
Water meme continues..
Good morning!
BCS with a half Billion Dollar fine for manipulatiing energy markets! 😎
This sets a very nice precedent to go after the rest of the bastards but I'm not sure the US is going to charge US companies. In fact, I think this may be the US manipulators kicking out a competing manipulator.
Also very good news – slowly but surely my issues are being addressed! Never think it doesn't help to write your Congresspeople, we've been agitating for this and, now that their exemption is up for review, it's being taken seriously:
Meanwhile, we've had a 0.25% sell-off in the Futures and, as expected, the RUT is getting hit harder than the rest. The Dollar bounced off 82.50 and back to 82.76 at the moment.
Oil $105.24, gold $1,284 after being rejected at $1,290, silver rejected at $20 and now $19.74, copper DOVE from $3.20 to $3.139 at 1:30 so I need to figure out what caused that (assume China GDP), nat gas flat at $3.659 and gasoline rejected at $3.15 and took it poorly, now $3.089.
As expected, the API report flipped as demand wasn't there to suck up the increased supply caused by cracking all those holiday barrels:
TSLA continued to dive after hours and Motley Fool has gone into overdrive trying to pump it back out – unfortunately, no arrests will be made:
We're starting to get real earnings reports and it's time to switch our brains back on and look at reality again. Monday was terrible, with 5 or 8 missing but yesterday only 3 of 19 missed (SCHW, WABC and MRTN) with 3 flat but KO, MOS, RECN and YHOO had lower revenues and made their money by cutting back spending – not a good overall economic signal… We'll see how today's batch fares:
Notable earnings before Wednesday’s open: ABT, ASML, BAC, BK, FCFS, FRC, GWW, IGTE, MAT, MTB ,
NTRS, NVS, PNC,STJ, TXT, USB
Notable earnings after Wednesday’s close: ALB, AXP,CCK, CLB, CVA, EBAY, EPB, IBM, INTC,
KMP , NE, PLXS, RLI, SCSS, SLM, SNDK,STLD, VMI, XLNX
So, lots of biggies today and, of course, the Bernanke on the Hill AND the Beige Book.
Wednesday's economic calendar:
7:00 MBA Mortgage Applications
8:30 Housing Starts
10:00 Hearing: Semiannual Monetary Policy Report (Bernanke)
10:30 EIA Petroleum Inventories
2:00 PM Fed's Beige Book
4:23 AM European shares (FEZ) are flat-to-higher ahead of Ben Bernanke's testimony to Congress this week. "If Bernanke is saying it's OK to taper, growth is coming through, don't worry about it, then that's actually fine for equity markets," says HSBC's Anna Edwards. EU Stoxx 50 +0.2%, London +0.5%, Paris +0.2%, Frankfurt +0.3%, Spain and Italy flat.
6:00 AM Overseas: Japan +0.1%. Hong Kong +0.3%. China -1.1%. India +0.5%. London -0.4%. Paris -0.5%. Frankfurt -0.6%.
Interesting take on Bernanke's testimony this morning, though I'm hard pressed to think who in Congress is going to come up with these pointed questions:
Any oil bets today?
Landslide/Lincoln – Wow, you guys sure know how to pick a vacation spot!
AAPL/Cturb – I would not own AAPL at $428. Why should you? The dividend is just $12.20 (2.9%). Already you want to hedge it so why not just sell the stock and sell the appropriate number of 2015 $350 puts for $28 and use that $28 to buy the 2015 $420/500 bull call spread ($28) as that pays you all of an $80 gain from here but, if AAPL fails to hold $400, even if you don't stop out of the bull call spread, you still only have a net entry at $350, which is down about 20% from here. So you have a free 20% protection and 20% upside and you should tie up less margin as well. Nice job getting out of TSLA – if a stock is not for you – don't play it. Wise decision. I agree, it's pretty cultish.
Conspiracies/ZZ – But right above, in the news is a conspiracy by BCS to manipulate the energy market. Just like the conspiracy by Enron to do the same. What is organized crime but a conspiracy to control illegal activities in a certain region? 911 was a conspiracy – no matter who you think was actually behind it – it seems to have worked. WMDs were a conspiracy to drive us to war with Iraq – also very successful. Conspiracies happen all the time and the culture of iBanks is like a fraternity (or the Mob), no one gets in on the real shenanigans until they prove themselves worthy of trust and the repurcussions for breaking that trust are probably more in line with the kind of punishment you'd expect from the Mob, rather than a fraternity.
Also, by the way, my main conspiracy theory is that you don't need an actual conspiracy to achieve most economic goals. You simply need the proper incentives and the self-interest of others will take care of the reast. So, if just me (say, Kenny Lay) has just one friend (say George Bush) and we work together to get a law written a certain way – then "market forces" takes care of the rest for us. The other people don't need to be in on the conspiracy, such as meeting in dark rooms etc – they just have to have their interests aligned well enough with yours that they will act the way you need them to.
Also, if you really want to understand how conspiracies work, get yourself invited to the Pine Valley Golf Club in NJ. It's nothing more than a place Billionaires and CEOs get together on the course and in the clubhouse to determine the fate of the World in a place where no strangers or press are allowed. Is it a conspiracy or just lunch?
SHLD/Rev – I think the mistake people make with Sears is thinking Lampert is trying to save it. He's not, he wants to destroy it but, in order to kill one of the most beloved classic American brands without being branded a bastard, he needs to make it look unsavable first. Then he can happily sell off the parts (mostly real estate) and cash out. Also, of course, as he's driven the stock down, he's increased his own holdings (at least 56.5% now). In fact, he just re-did his compensastion package to give him 10,000 shares of stock per month as payment for just staying on and converted his salary ($2M) to another 50,000 shares.
Thanks Jabob – Your approval is all I strive for!
Meanwhile, markets did a big U-turn and back to even now. Not the Dollar…
BAC had nice earnings and Mortgage Applications were only down 2.6% this week, finally slowing the relentless slide. However, builders are slowing down 15%, and that's very bad:
Big Chart – One day does not a reliable turn signal make.
Inflation/ZZ – You'd be serious about limiting it too if there were 70M of you (CPC) and 1,300M of THEM – who get cranky when they are hungry…
Bernanke/Rev – I wouldn't count on Bernanke taking any kind of heroic stand. I think his main goal is to get the fudge out before things blow up so he can leave his legacy intact – like our man Greenspan:
Chart
Jul 17
–
Jul 17
–
Jul 17
–
Jul 17
–
Jul 17
–
http://www.guardian.co.uk/business/2013/jul/17/eurozone-crisis-greece-austerity-bernanke-minutes Interesting live comments here.