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Fallout Friday – Global Concerns Rock US Markets

8-6-2014 9-16-39 PM IWMIraq, Ukraine, Ebola

PLENTY of things to worry about and we've ONLY corrected 10 points (7.5%) on the Russell – exactly what we predicted under our fabulous 5% Rule™!  None of the other major indexes have fallen as far, so we continue to watch that line very closely for support.  

This morning we played the S&P (/ES Futures) bullish in our Live Member Chat Room (you can join us here) off the 1,900 line and were rewarded with a quick 10-point gain (+$500 per contract) already (7:45) as our assessment of the Global situation (that it's not all that bad) seems to be playing out with Russia making a few conciliatory noises over in Ukraine though, of course, any good game of brinksmanship involves a bit of give and take – so it ain't over until it's over. 

As you can see from our Big Chart, we're still down 3 of 5 Must Hold lines and, when the Must Hold lines don't hold – we stay bearish!  Not too bearish, mind you, we've pretty much shifted to neutral in our Member Portfolios and our Long-Term Portfolio closed the day at $587,490 (up 17.5% for the year) while our Short-Term Porfolio finished at $132,314 (up 32.3% for the year) for a combined $720K up $1,000 for the week and down $4K on the day as we added more BULLISH positions (bottom fishing) into the weekend. 

8-6-2014 9-15-06 PM IYTWe'll quickly abandon our hopes for a bounce if the Dow fails to hold it's 200 dma at 16,343 and we're keeping an eye on the Transports, where IYT is testing it's 100 dma at 142, which Scott Murray's chart shows us has held firm for two years now.  

Having well-balanced portfolios let's us quickly pivot to take advantage of changing conditions and this is an inflection point, so we have bullish and bearish trades ready to trigger – depending on how these lines play out.  

While we're waiting, we have tons of fun with our Futures Trading.  In yesterday's moring post, I mentioned that we were going short on /TF (Russell Futures) at 1,130 and those contracts dropped all the way to 1,105 this morning (+$2,500 per contract) before finally turning back up, where we called longs on our Futures at 6:45.  My comment to our Members in our Live Chat Room at 9:05 (after taking our first, quick profits on a /TF dip) were:

Futures in a good spot to go bearish but not sure bearish is going to work today:  /YM 16,425, /ES 1,920, /NQ 3,875 and /TF 1,128.  I think if /TF tests 1,130 I'd like the short as long as /ES is under 1,920 and /YM under 16,450 and /NQ under 3,875 otherwise, it's short the laggard if 3 of 4 below those lines.

Of course, all the short ideas paid well and the Futures are an excellent tool to make quick adjustments to otherwise-balanced portfolios, but can be very dangerous if used incorrectly!  We also took advantage of TSLA's silly run to $255 to sell the Sept $260s for $11.75 to over-excited Musk fans.   Those calls finished the day at $9.85 up a quick 16% in 5 hours, but not a day trade.  We also took an earnings spread on SCTY and we'll see how this one plays out:

SCTY hanging on to great expectations at $76 and we can sell 5 Sept $77.50 calls for $6.50 ($3,250) against 5 Jan $80/95 bull call spreads at $4.55 ($2,275) for a $975 credit in the STP

Ideally, we would have liked SCTY to get a worse reaction to doubling their losses than being up 3% but Musk is the kind of the Conference Call and we will have to ride out the nonsense as the stock tests our $77.50 short target.  

During Live Member Chat yesterday, we also found a bullish trade on WAG ($60), bearish on GMCR at $120, bearish on TLSA at $255 (above), bullish on NLY at $11.40, bearish on SCTY (above) and our last trade of the day was bullish on SSO (ultra-long S&P).   

As you can see from Doug Short's SPY chart, we're not doing anything complicated, just playing for the bounce and shorting stocks we don't like and bottom-fishing the stocks we do.  Our trades are still leaning mixed as we're not sure if those lines are going to hold, but our LTP is still full of bullish trades and the fact we haven't cashed them yet tells you we're still very hopeful that this correction will be a mild one.  

Click to View

We're still at the top of a massive rally that saw us test a 200% run from our 666 low in March 2009. 1,332 points of upside NEEDS a 20% correction for it to be healthy.  That would take us from 1,998 back to 1,732 – around where we consolidated last Fall before breaking higher.  When the S&P ran it's first 100% from 666, to 1,332 in 2011, we corrected back 20% of that 666 run (133) back to 1,200 (after spiking down to 1,100), which was also our predicted line per the larger 5% Rule™.

Our new "Must Hold" line on the Big Chart for the S&P is 1,850 and it REALLY must hold or that 1,732 drop will come into play but, at the moment, we're comfortably in between 1,850 and the +5% line at  1,942.50, so playing the middle is an excellent strategy while the market digests the current risk climate.  

Have a great weekend, 

- Phil

 


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  1. I need to set up an alert or alarm to go off on my computer everytime  one of phils comments come up

    i keep missing futures plays by a few minutes can anyone suggest a way to do this.

    thanks


  2. Good morning!  

    We have an RSS feed (see the bottom of the main post) and I imagine RSS readers can alert you but the point isn't to follow me right into Futures trades but to learn to recognize the patterns so you can trade yourself.   Futures are very thinly traded and it would be a disaster if people plowed in and out en masse based on my suggestions.  This is a teaching site, and I want to teach you to catch these opportunities on your own.  Worry more about WHY we are getting in and out of positions, rather than WHEN and practice in a paper-trading account because Futures are VERY dangerous.  

    Speaking of dangerous – My best friend is turning 50 so I'm off to Boston today, planning to leave by 2pm for a party weekend.  Hopefully the markets will be nice and boring…


  3. Oil Lines

    R3 – 100.68
    R2 – 99.56
    R1 – 98.78
    PP – 97.66
    S1 – 96.88
    S2 – 95.76
    S3 – 94.98


  4. I don't know that cable companies would be crazy about that idea:

    http://qz.com/246246/hbo-used-to-hate-netflix-now-it-wants-to-be-just-like-it-because-rupert-murdoch/

    Netflix is growing faster, but HBO arguably still has a lot of room to grow (especially if more people were able to access it easily and without paying for other content they don’t want). A Netflix-like valuation to HBO yields more than Time Warner’s current market capitalization of $62 billion. So the option of making HBO Go available on the internet without a full cable subscription (referred to as going “over the top”) in the US,  as is already available overseas, may be a valuable one.

    Until now HBO has resisted doing so because it would involve sacrificing the lucrative income it receives from the pay-TV distribution companies. But suddenly that concern seems to have vanished: Bewkes is now talking about Time Warner developing a “platform that could not only deliver HBO networks but also Turner network and frankly other networks” online.  In short, Rupert Murdoch may end up being be the catalyst that spurs Time Warner and HBO to fully embrace the internet TV revolution. Go figure.

    There would be more wire-cutters! They already lose subscribers by the 100's of thousands.


  5. phil,

    morning….your thoughts re a buy rig jan 6 33 call and sell 33 put and either sell calls along the way or just wait to sell the other side of the bcs when it improves as looking at a 10 yr chart this has been the bottom before………………tks 


  6. Who could have predicted that – Wall Street benefits and we end up losing…

    http://qz.com/246312/wall-street-big-tobacco-deals-have-left-us-states-with-billions-of-debt/

    In November 1998, attorneys general from across the country sealed a historic deal with the tobacco industry to pay for the health care costs of smoking. Going forward, nearly every cigarette sold would provide money to the states, territories and other governments involved—more than $200 billion in just the first 25 years of a legal settlement that required payments to be made in perpetuity.

    Then, Wall Street came knocking with an offer many state and local politicians found irresistible: Cash upfront for those governments willing to trade investors the right to some or all of their tobacco payments. State after state struck deals that critics derided as “payday loans” but proponents deemed only prudent. As designed, private investors—not the taxpayers—would take the hit if people smoked less and the tobacco money fell short.

    Things haven’t exactly worked out as planned.

    A ProPublica analysis of more than 100 tobacco deals since the settlement found that they are creating new fiscal headaches for states, driving some into bailouts or threatening to increase the cost of borrowing in the future.


  7. NYC… How I do miss it. Heading home today.  Be on next week…. Oh and Hedwig and the Angry Inch…was absolutely Phenomenal!  Have a good weekend all!


  8. This is new:

     

     

     

     

     

     

     

    We pay 4% more so the people working in the restaurant can live like human beings?  OK…

    This, by the way, is the max effect I calculated when this debate began so this restaurant owner, in trying to make a point – is making my point instead.  

    Funny:  8 Reasons Children of the 70s Should be Dead.  

    should be dead (2)

    Greg has uploaded a whole new Webinar Control Center – hopefully it will fix the bugs we had Tuesday.  We're going to test it at 10 am.


  9. Phi;

    On the webinar can you "teach" us what you saw this AM in the stock futures.  Thx


  10. Hi All,

    New test event scheduled. (Got a different "system" from webex this time.) Hopefully it will eliminate the bugs from the previous "system". 

    I'm still trying to get a hang of all the new options, so bear with me if there's some issues with registering, etc.

    Webinar link here: https://philstockworld.webex.com/philstockworld/onstage/g.php?t=a&d=667518189


  11. Phil/ARO

    Would you sell puts here? The 2016 $3 puts are fetching .80 or for less exposure the 2016 $2.5 puts are showing .55. Both more than pay for the original 2016 $3.5/$5.00 BCS.


  12. Hi Phil "Burger" they are not good for you in the first place and if you now have to pay for the waiters wages you do not have to tip any more just like here tip is included in the price.


  13. Pharm,

    Thx for the recommendation on Hedwig. Heading up to NYC in Sept. Any other productions you saw that you especially liked?

    Thanks


  14. Phil / SCTY – Seems like they are giving up some of the gains made premarket and moving in the direction we would like it to. Question, at what point do you get out of the bull call spread, or possibly just the 80 call when a trade like this is moving the way you thought it would?


  15. 8800….Hedwig had Neil Patrick Harris. He is done in a week and then the lead from Book of Mormon is taking over. If/Then was also. Very good. The 9/11 memorial was a good site and you need 1/2.a day there.


  16. Later…hopping on a plane.


  17. HBO/StJ – Interesting but what a mess this is making.  How many media subscriptions do I have to buy?  

    RIG/Mill – I'm willing to put my foot down here.  They are down on fears (stirred up by analysts) that they may not fetch good rates on their forward contracts but I just put up an article about how fracking is moving out to sea and who do you think they need to make that happen?  RIG might correct down further but, long-term, that just makes me want to buy more.  I wouldn't buy an uncovered Jan $33 as there's no evidence that they are done falling but selling the 2016 $35 puts for $5.20 puts you in for net $29.90, another 20% off from here – very nice for an initial entry.  When they show that they've found a solid floor, THEN you can add a bull call spread but I wouldn't sell calls against a stock that's about 25% undervalued.  

    Tobacco/StJ – That is ridiculous.  The Government should step in and unwind those deals.  The Banksters come in and do a dog and pony show with their armies of lawyers and accountants and overwhelm the local Governments (or just bribe them), who are pressured to sign terrible deals.  Of course it's all going wrong…

    Have a good trip Pharm.

    Futures/Options – Sure. 

    Thanks Greg!  

    ARO/DC – Yes because you have a semi well-known national brand, which makes it valuable to SHLD, WMT, JCP, etc to bring in-house, so call that $500M to build yourself and the company is already just $250M.  Plus they have $25M cash, $170M inventory, $195M Property, Plant, etc against no debt (but $217M a/p) and, of course, $2Bn in sales.  Though down 15% from last year, $2Bn is nothing to sneeze at and, at $250M for the whole company, there has to be someone who thinks they can turn $2Bn in sales into some profit.  It's very speculative and, if not sold, they are likely to dillute but net $2.20 from selling the 2016 $3 puts for .80 is a nice entry position, so yes to that sale and we'll add it to the STP officially.  

    Burgers/Yodi – That's true, I'd be more inclined to tip 15% rather than my usual 20%.

    SCTY/Pfel – It depends when we get a good price – ask in webinar.  

    Webinar time!!!


  18. pfehlmann

    SCTY  the play was discussed yesterday The BCS is just held as a buffer and to make it look better for margin As soon as the Sept call expires the best is to close the BCS for what ever you can get, alternatively if they shoot to the moon than you can hold out and collect on the BCS however if they do not go over 80 the complete BCS is OTM!!!!


  19. Greg or anyone/webinar

    How do you get sound to play from computer? I can not get it to work.


  20. Thanks Yodi, I wasn't sure if you held the BCS until the Sept call expires but it makes sense that you keep the "insurance" until then.


  21. "As for the other teen retailers, Aéropostale is trying to become more relevant with its target customer, including a partnership with YouTube star Bethany Mota. To highlight this shift, the retailer's website has been running with the tagline, "You've changed, so we've changed." "

    http://www.cnbc.com/id/101880398?__source=yahoo|finance|headline|headline|story&par=yahoo&doc=101880398


  22. pfehlmann

    naked calls or puts are often not a good thing as they can come back to bight you but if the stock drops an other 25% it would not make much sense to hold the BCS possible even sell the long call.


  23. Dan, If you haven't got it yet, When the event is opening and you get the box, click use computer for audio


  24. Dan, You may need to click the button that says "call from computer"…


  25. skier/greg

    I did that with no results. Still no volume.


  26. Boy, older teens give a resounding thumbs down to AO, but they do still like Abercrombie and JCREW.

    http://video.cnbc.com/gallery/?video=3000298620&__source=yahoo|headline|quote|video|&par=yahoo


  27. Dan, that's odd. (I'm on a mac, so things might be different but…) In the menu up top… do you see "Communicate"? If so… you should then see "Audio Conference". Then "Use Computer for Audio" and then you should see levels for mic and speaker and a button that, if you're in the conference, should say "leave audio conference". If it does say "Leave Audio Conference"… then you're in and the problem exists somewhere in your computer (speakers unpluged, off, volume low, etc.) Keep me posted!


  28. Greg

    Not a big deal. I am sure it's something stupid! In the Audio Conference window it says I am participating in the audio conference but it shows a headphone set with a circle-slash. In my settings (using a MAC PRO), none of the sound buttons are muted or turned off. And I do get sound on other things just not this.


  29. Greg

    One other thing, in the participants box I am the only one showing.


  30. Greg

    I don't know how it's different, but the replay from the other day worked fine.


  31. Only the host can see all participants. (It's a setting in the background and I just left it on default.)

    This new webex system… on the back end, is TOTALLY different. I have way too many options and settings now.

    Hmmm… that should be all correct. (The headphones/mic with the circle-slash is just showing that we can't talk.) Do you see the volume and mic level bars? Next to the levels is a speaker icon and a mic icon. Make sure the speaker icon is not slashed out.


  32. Greg 

    It was not slashed out (speaker).  I did the old fashioned thing and restarted my computer. I will try again.


  33. Greg

    Better late than never! Re-starting worked. Plus I went through Safari instead of Firefox. I am not sure what the "fix" was.


  34. Checking in, looks OK, good luck, y'all, off to the sawbones, go ABX!!


  35. Strange stuff Dan. I'm using Chrome so… who knows. Ha! Could just have been an issue with the webex plugin and your browser, or even a deeper conflict with OS X. Glad it's working! 

    For anyone else attending… if there's any issues, shoot an email to "admin AT philstockworld.com"

    (I will fix the chat with everybody problem though….)


  36. Greg,

    Are we signing in with PSW name and password? Thanks


  37. Hey Jal, you'll register just like you did when we did this with Darwin. (Don't know if you attended any of those.)  

    You'll follow the link that Phil or I will post in chat on the morning of the webinar and "register" with webex (put in name and email) and that should be all. (In the future you should just have to login with that webex user/pass.)


  38. Greg, every one of them on Darwin….I guess i'll be ready the next time around….Thanks


  39. Good Morning from "The City by a Body of Water" (S.F.)

     

    Phil, those 11 commandments to me, is just good 'ol common sense….. :)


  40. Phil/ Shall we hang on to Sept EWJ puts? Or not.


  41. No problem Jal… today was mostly just a test of the new system. Gotta work all the bugs out before we do it for "real". Ha!


  42. Greg 

     

    did you fix the alerts for hotmail  ?

    Thanks


  43. Shadowfax fund update -

    Hi All -  Phil's rant on inequality yesterday provided an opportunity to remind everyone of our Shadowfax fundraiser.   Jen, Shadow and I expanded the narrative and added pictures (MRI, CT scan, x-rays) so you have a better picture of Shadow's situation.  Please feel free to send comments at our fundraiser page ('Contact the Organizer' button at the bottom of 'Fundraiser Details' tab).

    Here is the link :http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743.

    Thanks to all who've contributed and/or promoted the fundraiser; indeed, we have a community of caring members!  We have made a good start ($4,600 in contributions) but we have some ways to go to reach our $50,000 target, so please spread the word out!  Surely, Shadow's health is worth more than a potato salad fundraiser that raised $55,000.

    Thank you!

     


  44. Phil/SCTY – Should we sell the long call portion of the call spread, or is that too reckless?


  45. Palotay SCTY see my comments on them above


  46. My quote of the day:

    http://www.bloombergview.com/articles/2014-08-08/halfway-through-a-correction

    Now, today’s weak futures are blamed on the threatened U.S. airstrikes on ISIS, dragging America into another Middle East war. Each time I think I have finally put George W. Bush’s misadventures out of my mind, something comes about to remind us how utterly bereft of reason or intelligence the decision to invade Iraq was. It is likely to haunt the U.S. even longer than the disastrous Vietnam War.


  47. Hey Mike, I sent you an email…


  48. Nice, SCTY back under $75.

    SCTY/Yodi – Not just for margin, also for protection in case we blew the call.  

    DC, did you end up getting sound?

    ARO/DC – Thanks. 

    Common sense/1020 – In short supply these days, unfortunately.  

    EWJ/$25KP, Griffin – Good call!  The 200 dma is at $11.60 so I'd say let's take .45 and run in the $25KP

    Thanks Bai!  

    SCTY/Palotay – It would be an irresponsible risk in the $100,000 STP but it is something I would do in a $500,000 portfolio with just 5 open calls with my own risk tolerance.  

    Good quote, StJ.  


  49. Thx Yodi, but I already understand how this trade works.  I'm just wondering if today's action makes us confident enough to remove the protection.


  50. palotay 

    Never trust a one day show


  51. Time to check our bounce levels to see how excited we should be about this low-volume rally (48M on SPY so far):

    • Dow 17,100 to 16,350 is 750 points so 150-point weak bounce to 16,500 and a strong bounce would be 16,650
    • S&P 1,990 to 1,900 is 90 points so 20-point bounces (rounding) to 1,920 (weak) and 1,940 (strong)
    • Nasdaq 4,475 to 4,325 is 150 points so 30-point bounces to 4,355 (weak) and 4,385 (strong)
    • NYSE 11,050 to 10,550 is 500 points so 100-point bounces to 10,650 (weak) and 10,750 (strong)
    • Russell 1,200 to 1,110 is 90 points so 20-point bounces (rounding) to 1,130 (weak) and 1,150 (strong)

    Not too impressive, is it?  Keep in mind that yesterday, the weak bounce on the NYSE was 10,730 so we're LOWERING our expectations by 80 points and STILL missing the mark!  That's why, as time goes by, you get less and less satisfied with making just the weak bounce and even the strong bounce comes into question as lower lows are made.  Simply – it just takes more and more for a reversal to impress us.  


  52. phil,

    tks as always for the rig thoughts……makes more sense in this environment and have a good trip


  53. They seem to think that we are oversold:

    http://www.bespokeinvest.com/thinkbig/2014/8/7/oversold-everywhere.html

    Seems that way on these charts.


  54. Phil/webinar

    Yes, I did catch the last part.  Re-starting my computer fixed sound issues.  

    Will patiently wait for ARO puts to sell for .80.  ARO may not be able to fix their problems, but it makes sense that the current value of the parts may be worth more than the current management. On the other hand, we are talking a customer base that can change their minds in a minute and often.


  55. This one is for you Phil:

    Eddy Elfenbein, “Successful investing basically boils down to buying high-quality companies at cheap prices.”  (Crossing Wall Street)


  56. I've been trying to close out my SQQQ $42/49 BCS purchased at $1.85 for $2.60 for the past three days but no takers.  Hoping I can clear out of the short position and get some more cash.  I don't have any faith in the upside or the downside right now so I'm just going to maintain some 2016 long positions on AAPL, HOV, IRBT (March 2015), TWTR, and YHOO (Jan 2015)


  57. See how we come right up to those weak bounce lines and fail?  This continues to be a bad sign, of course.  

    You're welcome Mill.  

    Oversold/StJ – Actually, if you look at the McClellan, it's flashing a very bad indicator because the oversold condition is working off WHILE the markets are going down – indicating we could/SHOULD be going down a lot faster. 

    ARO/DC – Yes, teens are fickle and they can go back as fast as they left.  We need to watch the back to school numbers carefully but I was in one of their big stores and liked what they are doing.  

    Amen StJ!  

    SQQQ/JPH – Almost impossible to get a good price on the spread as a unit, best to just ask (assuming Dec) $5.50 for the $42s and offer $2.50 for the $49s if you are looking to get out and see which side fills first.  Once one side fills, then you can see what you can get for the other.  Still, it's a perfectly good spread – I'd hate to give up the protection into the weekend.  

      


  58. Phil / SCTY – thanks!


  59. Oversold / Phil – Obviously, many different indicators out there.. And we can stay oversold for a while!


  60. Phil,

     

    could not attend the webinar.  SCTY is at 71. Should we get out of short calls or wait for the another leg?

     

    Thanks


  61. rookie / SCTY – this is what Phil said earlier in the post:

    "SCTY/Palotay – It would be an irresponsible risk in the $100,000 STP but it is something I would do in a $500,000 portfolio with just 5 open calls with my own risk tolerance. "


  62. Alrighty, I'll take your suggestion and hold it for the time being.  My thinking was, "why hold a 30% profit that occurred in under a week" but I doubt I'll lose any premiums over the weekend so I guess no real reason to sell it either.

    Thanks


  63. ARO vs. RSH /  Phil     Good afternoon, is there any way you can make the same comparison of Radio Shack as ARO.   RSH has $3.4B sales but a whole lot more debt.  With the stock at .64 I don't see much of a chance for survival without a chapter 11.  

    Ok, here's the reason for my question:  I heard a rumor ( not sourced via the internet) that after a bankruptcy filing some one very wealthy is going to be interested and has all ready started working out the details.  So who would want them?  I'm thinking the new owners would ditch all of the hobbyist stuff and stick with phones, tablets , games , windows pc's .   hmmm


  64. Speaking of SCTY, I'm loving that I sold those long calls.  SCTY falling off a cliff right now.


  65. stockbern / RSH

    Didn't you just describe Best Buy?  Phones, tablets, games, windows pc's…you're talking about Radioshack becoming a Best Buy but with a  smaller footprint per store with a lot more stores requiring more employees per sq ft of space.

    It doesn't sound like a winning idea to me but who knows.


  66. stockbern RSH

    That makes sense, only problem with them is they never made changes to reflect changes in the last 20 years, they also sell a lot of satellite TV. They could even tweak the hobby stuff like get rid of ALL!!! the junk! Nobody buys crappy parts and that is what they sell. I even think their batteries suck.


  67. Today I see the RUT is forming a raising channel, only issue is it is alone.


  68. He Guys SCTY we discussed the matter earlier nice to see a nice paper profit on the 77.5 caller but with a little bit of patience we get the rest of the premium an other 3.00 You might call it greedy I call it patience. 


  69. ZO' NICE CALL ON THE UP DAY THIS FAR!!


  70. Reed Hastings takes victory lap with Jeff Bewkes in rear-view mirror • 1:47 PM

    Netflix (NFLX -0.4%) CEO Reed Hastings took to Facebook to call attention to what he calls themilestone achievement of the company passing HBO in subscriber revenue.

    "HBO rocks, and we are honored to be in the same league," wrote the exec.

    During Time Warner's (TWX +1.7%) earnings call earlier this week, CEO Jeff Bewkes was spared any direct questions from questions about the Netflix factor. Perhaps just as well after Bewkes in 2010 famously likened the metamorphosis of Netflix into a streaming giant to the Albanian army trying to take over the world.

    TWX Earnings call transcript


  71. jph1121 & shadow

    I was thinking Microsoft would want them.  MSFT has some stores, mostly mall based and not that many locations


  72. Markets flying now as news is that Russia's military "exercises" are over.   Still watching our lines and still not wanting to shift gears into the weekend.   

    SCTY/Rookie – Steady as she goes – it's on track now.  

    That's the right logic JPH.

    RSH/Stock – Unfortunately, it's different for RSH as their business model is kind of bust and they are a money pit by comparison, burdened with 4,500 stores and 27,000 employees and they don't even make the stuff they sell (well, some).  They only have enough cash to last 6 months and they have $1Bn in debt against a $64M market cap.  It's possible someone may want to reinvent them but it would still cost $1Bn + $500M to relaunch (at least, that's just $100K per store), not to mention rolling inventories, etc.  I'd rather scrape together a few more bucks and buy BBY for $10Bn.  

    Well guys, I've got to run – have a great weekend all!  

    - Phil

    Speaking of TWX, let's sell 5 of the 2016 $62.50 puts for $3.40 in the LTP and see how they go


  73. The budget fairy… Trickle down anyone?

    http://equitablegrowth.org/2014/08/08/magic-asterisks-budget-robert-waldmann-continues-civility-discussion-friday-focus-august-8-2014/

    Ever since the start of 1981 and the miseducation of David Stockman, the bane of a sensible American fiscal policy has most often been the magic asterisk: the implicit claim that some policy that the politician dares not name or some magical Budget Fairy will fly down from above and make everything OK. When this magic asterisk is found, by my guess 90% of the time it is in budget “plans” from Republicans–but a good 10% of the time it is found in plans from Democrats (yes, Bill Clinton, Al Gore, and Gene Sperling, I am looking at you).

    It has always seemed to me that fighting against the magic asterisk requires from serious professional economists a zero-tolerance policy that needs to have three components:

    1. Politicians who will not present plans in enough detail for CBO to score them need to be ridiculed and hooted off the platform.
    2. Politicians whose plans are scorable by CBO need to have those plans presumed to have the effects that CBO says they do.
    3. Politicans who wish to overcome the presumption that their plan will do what CBO says that it will do need a supporting analysis that jumps an Olympic-class high-jump bar before they can be admitted to the rational public sphere.

    Ryan flunks and has always flunked (1). We never even get to a score. And we definitely never get to an argument that CBO’s score is not the right forecast.


  74. stockbern

    RSH and Microsoft  doesn't click with me. What they need is someone like the guy in Jackson who owns a franchise, has completely changed the style, hasn't stocked the junk in years, and dose other things like custom installations, a geek force, and they install satellite instead of sub it out. He makes money with a bunch of employees that do not work in the store. Someone could do that but it would take one not a Microsoft or any too big company. He even pays well enough to keep people in a super expensive town. 


  75. stockbern

    Another difference is Radio Shack was always a DIY store, he did a 180 and has a force to install and maintain it all, he even puts up antennas for people that want full HDTV instead of crap for $150 per month, or FM radio.


  76. StjL,  Or anyone am I correct in thinking the weak bounce lines must hold for 2 days to get more bullish?


  77. Hi, Angel, back from the sawbones.  Thanks, too early profits on my SPX since I was trapped in a doctor's office and traffic for five hours, but green is green, I'm good!!  Short of a nuke, I'm not sure what Europeans can do [to each  other] that would make our market sell off.  Maybe I'll commit the ultimate folly and jump back in again.


  78. /CL – oul.

    Did you notice that second month in the row, spread between front and next month doesn't narrow towards end of the cycle.

    Not sure what it means, but it's different dynamic


  79. ZO' HOPE YOURE OK


  80. Chopped and channeled, but the sawbones sez I'm good, just need to cool out with the baby carriage pushing.  But I'm a sucker for those big eyes.  Thanks. A.


  81. Angel:  Aren't we getting close enough to autumn for the market to begin to anticipate the Apple Resurrection?  Disclosure: Just went long, first time since spring.


  82. Bullish / Jomptien – I guess we have the weekend to ponder that! Maybe Ukraine blows up…


  83. StJ, Thats what I thought – Thanks


  84. PNRA/Phil:  The income portfolio PNRA play of selling 2016 $125 puts for $9.50 to fund the $140/$155 BCS is back to its pre-earnings prices.   Do you still recommend it as a good entry here or perhaps wait for it to settle down first?

    Thanks.


  85. From Bloomberg, Aug 8, 2014, 4:57:47 PM


    Aug. 8 (Bloomberg) — Morgan Stanley Investment and Portfolio Strategies’ Lisa Shalett discusses her investment ideas on “Bloomberg Surveillance.” (Source: Bloomberg)

    U.S. stocks rose, with the Standard & Poor’s 500 Index climbing the most in five months to erase a weekly loss, as signs that tensions are easing in Ukraine outweighed concern over crises in the Middle East.

    To read the entire article, go to http://bloom.bg/1zZdFIL

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  86. From Bloomberg, Aug 8, 2014, 2:08:01 PM


    Aug. 8 (Bloomberg) — Bloomberg’s Michael McKee reports on Russia sanctions ban food imports from the United States, European Union, Australia, Canada, and Norway with Betty Liu on “In The Loop.” (Source: Bloomberg)

    Ukraine threatened to block Russian oil and gas supplies to Europe in new sanctions against Vladimir Putin’s government, which it blames for a separatist uprising that has ravaged the country’s east.

    To read the entire article, go to http://bloom.bg/1msEDQG

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  87. From Bloomberg, Aug 9, 2014, 6:17:45 AM

    Palestinians collect usable stuff inside the debris during 72-hour humanitarian ceasefire in Rafah, Gaza. Photographer: Rahim Khatib/Anadolu Agency/Getty Images

    Israeli airstrikes in the Gaza Strip
    killed at least five people today and Palestinian militants
    renewed their rocket fire, with no sign the two sides are near
    to reinstating a cease-fire a day after it collapsed.

    To read the entire article, go to http://bloom.bg/1u9c5Dz

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  88. From Bloomberg, Aug 8, 2014, 6:01:00 PM


    Aug. 8 (Bloomberg) — Bloomberg’s Michael McKee reports on Russia sanctions ban food imports from the United States, European Union, Australia, Canada, and Norway with Betty Liu on “In The Loop.” (Source: Bloomberg)

    By Ilya Khrennikov, Milda Seputyte and Ott Ummelas

    Russian customers buy cheese in Saint Petersburg on Aug. 7, 2014. Photographer: Olga Maltseva/AFP via Getty Images

    Aug. 9 (Bloomberg) –- Border guards in Russia and Belarus moved swiftly yesterday to enforce Vladimir Putin’s ban on food imports from the European Union, turning back trucks loaded with cheese, yogurt and meat, according to officials from Lithuania and Estonia.

    To read the entire article, go to http://bloom.bg/1oMbsMA

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  89. From Bloomberg, Aug 9, 2014, 12:01:01 AM

    Argentina may be held in contempt of
    court if the country’s officials don’t stop issuing false and
    misleading statements about a dispute between two groups of
    bondholders, said the U.S. judge overseeing the case.

    To read the entire article, go to http://bloom.bg/1q1zz6Z

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  90. From Bloomberg, Aug 8, 2014, 12:13:10 PM


    Milk, toilet paper, health care.

    As its retail business matures into slower growth, Wal-Mart Stores Inc. wants to disrupt another mass market: health care. The company is piloting what it hopes will be a broad network of primary-care clinics. The company already has urgent-care clinics in about 100 stores, but the new facilities will provide much broader services such as chronic-disease management that are normally provided at a doctor’s office. And it is doing so at an admirably low cost: A doctor’s visit at one of its primary-care clinics costs just $40, in cash — the only insurance they take is their corporate health plan and Medicare.

    To read the entire article, go to http://bv.ms/1u6rIvt

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  91. From Bloomberg, Aug 9, 2014, 12:01:00 AM


    LinkedIn Corp. is working to make a $1 billion business out of its marketing solutions product by 2017, propelled by its planned acquisition of Bizo Inc. Photographer: David Paul Morris/Bloomberg

    LinkedIn Corp. (LNKD) is working to make a
    $1 billion business out of its marketing solutions product by
    2017, propelled by its planned acquisition of Bizo Inc.

    To read the entire article, go to http://bloom.bg/1suaLr1

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  92. From Bloomberg, Aug 8, 2014, 9:00:17 PM

    Isaiah Austin of Baylor University dunks in the second half against the Nebraska Cornhuskers during the second round of the 2014 NCAA Men’s Basketball Tournament in San Antonio, Texas, on March 21, 2014. Photographer: Ronald Martinez/Getty Images

    National Collegiate Athletic Association rules barring student athletes from seeking a share of its $800 million in annual broadcast revenue are illegal, a federal judge ruled in a decision that may sweep away players’ amateur status and opens the door for them to be paid.

    To read the entire article, go to http://bloom.bg/1ok6vw1

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  93. From Bloomberg, Aug 9, 2014, 12:00:27 AM

    Treasuries rallied, sending benchmark
    10-year note yields to the lowest level in more than a year, as
    investors sought a haven amid turmoil in the Middle East and
    Ukraine.

    To read the entire article, go to http://bloom.bg/1oygeZF

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  94. From Bloomberg, Aug 8, 2014, 7:26:48 PM

    The Philippine peso led a weekly
    decline in Asian currencies as tensions in Ukraine and the
    Middle East and improving U.S. data spurred dollar demand.

    To read the entire article, go to http://bloom.bg/1q064SR

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  95. From Bloomberg, Aug 9, 2014, 12:01:01 AM

    Apple Inc. (AAPL), Google Inc. (GOOG), Intel Corp. (INTC)
    and Adobe Systems Inc. (ADBE) have to go back to the negotiating table,
    or face trial, after a judge rejected their $324.5 million
    settlement of claims that they schemed to not recruit each
    other’s workers.

    To read the entire article, go to http://bloom.bg/1kQc194

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  96. From Bloomberg, Aug 8, 2014, 7:01:00 PM

    African Bank Investments Ltd. (ABL)’s 95
    percent stock plunge has been no surprise to some investors who
    borrowed a fifth of the lender’s shares in anticipation.

    To read the entire article, go to http://bloom.bg/1mtFiRK

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  97. Watch this video at http://bloom.bg/1sjRbkA

    EU, Russia Have Little Appetite for More Sanctions

    Aug. 8 (Bloomberg) — Joseph Dayan, head of markets at BCS Financial Group, discusses the possible implications of Russian President Vladimir Putin’s food import ban from the U.S. and Europe.
    He speaks with Guy Johnson on Bloomberg Television’s “The Pulse.” Source: Bloomberg)

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  98. Watch this video at http://bloom.bg/1yctgSg

    Dollar Below 1.3350 Per Euro `Important’ for Rally

    Aug. 8 (Bloomberg) — Federal Reserve Chair Janet Yellen is tempering dollar strength with “her dovish views,” says Peter Rosenstreich, chief foreign-exchange analyst at Swissquote Bank SA. He talks about the outlook for the dollar versus the euro and pound over the coming months.
    He speaks from Geneva with Bloomberg’s Niki O’Callaghan. (Source: Bloomberg)

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  99. Watch this video at http://bloom.bg/1sgxxpB

    How the Top 1% Hoard Their Cash Offshore

    Aug. 7: Bloomberg’s Matthew Miller and Olivia Sterns discuss the top billionaires offshore financial wealth and the difficulty of tracking down their assets.

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  100. From Bloomberg, Aug 8, 2014, 8:36:27 AM

    Bulk carriers are loaded with iron ore at the ship loading facility at Fortescue Metals Group Ltd.’s Herb Elliott Port in Port Hedland in the Pilbara region, Western Australia. Photographer: Sergio Dionisio/Bloomberg

    Australia’s plans to export more iron ore this year than any nation ever is driving up shipping costs by 80 percent. Increased sales from Brazil before year-end means freight rates could go higher still.

    To read the entire article, go to http://bloom.bg/1lFjen8

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  101. From Bloomberg, Aug 8, 2014, 3:12:20 AM


    Aug. 8 (Bloomberg) — Helen Qiao, chief Greater China economist at Morgan Stanley in Hong Kong, talks about the world’s second-largest economy and the government’s policies.
    A report is expected to show the nation’s exports rose for a fourth month. Qiao speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    China’s trade surplus surged to a record in July as export growth unexpectedly accelerated and imports fell, suggesting the U.S. and European recoveries will help sustain expansion in the world’s second-largest economy.

    To read the entire article, go to http://bloom.bg/1siLLGr

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  102. From Bloomberg, Aug 8, 2014, 5:01:03 AM


    A semiconducting wafer in Greensboro, North Carolina. Photographer: Victor J. Blue/Bloomberg

    The recent rally in Intel Corp. (INTC) may
    signal weakness for other semiconductor stocks.

    To read the entire article, go to http://bloom.bg/1oKLjOg

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  103. From Bloomberg, Aug 8, 2014, 1:06:48 PM

    This morning, I made note of the difference between secular bull and bear markets. I described secular bear markets as being longer-term, characterized by strong rallies, vicious sell-offs and earnings contractions.

    To read the entire article, go to http://bv.ms/1u6Ejz1

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8




  104. Some trends for US numbers:

    [Chart]

    [Chart]

    [Chart]

    [Chart]

    [Chart]

    [Chart]


  105. LEAP Strangles – a review (this stuff works)

    We had a discussion on the board back in February about the merits of purchasing LEAP strangles on large stocks and selling front month puts and calls to finance the purchase – Phil’s post here.

    I went for the purchase of a DIS 2016 55C/95P strangle for $47.59. Regardless of the price movements until Jan 2016, the strangle can always be sold for a minimum of $40 – the difference in the strike prices. That leaves $7.59 of premium to sell in order to make this a no-cost trade.

    The LEAP strangle was bought on 02/06. DIS chart here.

    Subsequent to that I have made 16 trades, in general selling front month calls and puts, rolling where necessary to end up with my current positions of short Aug 85 puts and short Sept 85 calls. Total premium sold to date is $9.14. There is $1.35 of premium left in the Sept 85 calls (but I will roll these next month) – so the target of getting a no-cost trade has already been achieved.

    Thus, the future sales of calls and puts until Jan 2016 will all fall to the bottom line (minus the cost of rolls, of course).  Certainly for DIS this approach has worked, I did the same for F, but the results are disappointing – I have not managed to pay off any of the excess premium.

    I always like selling straddles or strangles – one always has a winning side! It may sound a bit crass, but I find that a psychological boost. In addition, where patience is in limited supply, you get to keep trading on a monthly basis.


  106. 2017 LEAP contracts/ info from OIC

    Timing for 2017 as follows:

    (e) With regard to the listing of new January Long-term Equity AnticiPation ("LEAP") series on equity option classes, options on Exchange Traded Funds ("ETF"), or options on Trust Issued Receipts ("TIR"), the Series Selecting Exchange and any other exchange that lists and trades the same option class shall not add new LEAP series on that option class:
    (i) Earlier than September (which is 28 months before the expiration), for an option class on the January expiration cycle;
    (ii) Earlier than October (which is 27 months before expiration), for an option class on the February expiration cycle; and
    (iii) Earlier than November (which is 26 months before expiration), for an option class on the March expiration cycle.


  107. Have you tried LEAP strangle strategy on index's?


  108. SPY LEAP strangles/ thanks for asking. Of course Peter D has a very successful selling strategy on short term strangles on indices, but I don't believe he sells those against LEAP strangles. 

    I looked at SPY and it appears interesting; one combo just to show the possibilities:

    Buy Jan 16 150/230 @87.69 = $80 spread with $7.69 to finance. But this is where it becomes interesting, the Sep 182/205 can be sold for $1.34 – with a safety zone of 100 S&P500 points either way.

    The Dec 16 150/230 @93.55 also looks interesting. You've piqued my curiousity, and of course one avoids the single stock risk using indices. Thanks.


  109. Strangles / Winston – Thanks for the information. As I mentioned before, I do favor now indices over individual stocks, but you can easily diversify with all that .various indices – for example GDX, OIH, XLE, SLV, GLD, etc… I track about 35 of them. Not all of them have LEAPS but there is a lot of potential.


  110. StJ/ Thanks. The way I have structured my portfolio, many of my positions will expire in Jan 15 – and I mean expire worthless. Going forward, more and more of my new positions will be based on indices – you are right, there are many ways to create a double diversified portfolio.


  111. Phil, what do you think of FF?  


  112. OK, sorry If I'm long winded, but would like to pursue the LEAP/strangle thing some more and would like to hear some critiques/advice from all members as well as PhiI. I got into options because I wanted the opportunity to make money in all markets, but have been distracted in the exuberance of the market over the last year as well as being mesmerized in the learning curve of this web site. Now that the market appears to be more volatile, I'm not keeping up as well.  I can't keep up all the time with my day job and miss some hedges. Getting back to basics, I'd like to pursue the Leap /strangle for some of my portfolio. I think its fits me better than a condor. But where to begin? SGiven the above, I am on the right tract? If I do this which ETF's, how about index funds that are taxed as capital gains no matter how long they are held such as SPX and RUT. Is the increased volatility of RUT superior or more difficult? Any other candidates?

    As for the long puts and calls, what's the best delta? Is it better to pay more for a strangle that might make money on its own (for SPX delta .3 Dec 2016 =1725/2175) and pay more or buy a strangle that is cheeper but not likely to contribute to the final profits (SPX delta .1 Dec 2016 = 1250/2500) or somewhere in-between?

    As for the short options, delta ~.3? When is the best time to roll if the contract approaches being in the money? And what's best – weeklies or monthlies? For SPX trading larger dollar amounts in a smaller number of contracts might not make the commissions of weeklies cost prohibitive.

    Thanks to all…


  113. From Bloomberg, Aug 11, 2014, 3:31:33 AM

    European stocks rose, following U.S.
    equities higher, after a report that Russian war planes have
    finished military exercises near Ukraine’s border. U.S. index
    futures and Asian shares also advanced.

    To read the entire article, go to http://bloom.bg/1B80jLB

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  114. From Bloomberg, Aug 10, 2014, 5:52:19 PM

    A Palestinian man searches the debris of the al-Qassam mosque following Israeli air strikes in Nuseirat Refugee Camp in Gaza, on August 9, 2014. Photographer: Mustafa Hassona/Anadolu Agency via Getty Images

    Israel and Gaza Strip militants
    began to observe another Egypt-brokered truce, giving
    negotiators time to craft a more enduring accord after a month
    of violence in the Hamas-ruled territory.

    To read the entire article, go to http://bloom.bg/1kUyv8X

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  115. From Bloomberg, Aug 11, 2014, 4:09:58 AM

    not allowed. Russia responded with import bans on an array of food stuffs from the U.S. and Europe, including fish, beef, pork, fruit, vegetables and dairy. Photographer: Sean Gallup/Getty Images

    MWL Apparate Bau GmbH, based in the eastern German town of Grimma, has relied on strong ties with Russia to bolster business. Today, those links don’t mean much.

    To read the entire article, go to http://bloom.bg/1sNDesX

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  116. From Bloomberg, Aug 11, 2014, 4:39:29 AM

    Norway’s sovereign wealth fund, the
    world’s largest, bought a stake in an estate in London’s Mayfair
    district for 343 million pounds ($576 million), expanding its
    property holdings in the U.K. capital.

    To read the entire article, go to http://bloom.bg/1B81ElB

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  117. From Bloomberg, Aug 11, 2014, 2:10:39 AM

    A couple look at properties advertised in an estate agent’s window in London. Photographer: Jason Alden/Bloomberg News

    London house-price growth will slow
    to about 3 percent next year as the prospect of higher borrowing
    costs forces sellers to lower their expectations, Hamptons
    International said in a report today.

    To read the entire article, go to http://bloom.bg/1ssatnP

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  118. From Bloomberg, Aug 10, 2014, 5:00:01 PM

    Palestinian protesters, holding national flags and the flag of Hamas, green, take part in a demonstration in front of the Israeli built separation barrier in the West Bank village of Bilin, on July 28, 2014. Photographer: Abbas Momani/AFP via Getty Images

    As Israel seeks to sideline Hamas in
    any accord on the Gaza Strip’s future, it’s finding quiet
    support among Arab nations where antagonism toward the Islamist
    group eclipses their enmity toward the Jewish state.

    To read the entire article, go to http://bloom.bg/1plq1HB

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  119. From Bloomberg, Aug 10, 2014, 9:47:33 PM


    Aug. 8 (Bloomberg) — Helen Qiao, chief Greater China economist at Morgan Stanley in Hong Kong, talks about the world’s second-largest economy and the government’s policies.
    A report is expected to show the nation’s exports rose for a fourth month. Qiao speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    China’s slumping property market is
    fueling speculation the industry is set for a shakeout as small
    developers face difficulty raising funds to pay off debt.

    To read the entire article, go to http://bloom.bg/1kvdh0V

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  120. From Bloomberg, Aug 11, 2014, 4:16:12 AM

    Aug. 11 (Bloomberg) –- Bloomberg’s David Ingles reports on Bloomberg’s new China Monetary Conditions Index, how it works and how China loosening its monetary policy effects the fundamentals of the economy. He speaks to Angie Lau on “First Up.” (Source: Bloomberg)

    China loosened monetary conditions last quarter at the fastest pace in almost two years, a Bloomberg LP gauge showed, testing the waning effectiveness of credit in supporting economic growth.

    To read the entire article, go to http://bloom.bg/1sKOCXm

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  121. From Bloomberg, Aug 11, 2014, 4:31:59 AM


    Gold bangles are displayed for sale at a jewelry store in the Mongkok district of Hong Kong. Photographer: Lam Yik Fei/Bloomberg

    Hong Kong’s economic growth slowed in the second quarter as tourist spending on jewelry and watches plunged, underlining the city’s reliance on Chinese visitors.

    To read the entire article, go to http://bloom.bg/1B80cQe

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  122. From Bloomberg, Aug 11, 2014, 3:22:10 AM


    Aug. 11 (Bloomberg) — Jason Low, equity strategist at DBS Wealth Management and Private Bank in Singapore, talks about the outlook for Japan and China stocks.
    He speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    Stocks climbed in Europe and Asia (MXAP),
    where a regional index is headed for its biggest gain in two
    months, after a rally in the U.S., while Australian and U.K.
    bonds fell with gold. Emerging-market currencies strengthened.

    To read the entire article, go to http://bloom.bg/1sNJf8T

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  123. From Bloomberg, Aug 10, 2014, 7:01:03 PM

    The balance of power in the job
    market is shifting slowly toward employees from employers.

    To read the entire article, go to http://bloom.bg/1ssaxUD

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  124. From Bloomberg, Aug 11, 2014, 4:15:24 AM


    A worker prepares the interior of a vehicle as it passes along the production line at the Renault SA automobile plant in Valladolid, Spain. German carmaker Opel said last month that its market share in Spain was the strongest since 2006 in the first half. Photographer: Angel Navarrete/Bloomberg

    Germany probably underperformed
    Spain last quarter for the first time in more than five years as
    the euro-area recovery almost ground to a halt.

    To read the entire article, go to http://bloom.bg/1r41Xf5

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  125. From Bloomberg, Aug 11, 2014, 4:29:32 AM


    Vladimir Putin, President of Russia. Photographer : Andrey Rudakov/Bloomberg

    Russia is limiting corporate access to domestic financing even as the escalating Ukraine crisis increasingly isolates companies from overseas sources of cash.

    To read the entire article, go to http://bloom.bg/1kvnZUZ

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  126. From Bloomberg, Aug 10, 2014, 6:03:22 PM


    Artificial intelligence may approach the human kind between 2040 and 2050.

    From Ancient Greece to Mary Shelley, it’s been an abiding human fear: A new invention takes on a life of its own, pursues its own ends, and grows more powerful than its creators ever imagined.

    To read the entire article, go to http://bv.ms/1vv6n0y

    Sent from the Bloomberg iPad application. Download the free application at http://itunes.apple.com/us/app/bloomberg-for-ipad/id364304764?mt=8


  127. From Bloomberg, Aug 9, 2014, 8:24:04 AM

    Source: WSJ

    Good morning. Before you head out to play in the sunshine, here are some longer-form weekend reads to kick off your Saturday:

    To read the entire article, go to http://bv.ms/1olcjVO

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  128. Good morning!

    Asia popped 1.5% but Japan up 2.4% with /NKD up to 15,160.   Europe up 0.8% except Germany, who are up 1.6% and our Futures are up 0.5%.   

    So Asia rallied because we rallied and Europe is rallying because we rallied and Asia rallied and now we are rallying because Asia and Europe rallied and that's why you get out of the way of these things until they calm down.  We continue to focus on those bounce lines and the strongs should come into play today:

    • Dow 17,100 to 16,350 is 750 points so 150-point weak bounce to 16,500 and a strong bounce would be 16,650
    • S&P 1,990 to 1,900 is 90 points so 20-point bounces (rounding) to 1,920 (weak) and 1,940 (strong)
    • Nasdaq 4,475 to 4,325 is 150 points so 30-point bounces to 4,355 (weak) and 4,385 (strong)
    • NYSE 11,050 to 10,550 is 500 points so 100-point bounces to 10,650 (weak) and 10,750 (strong)
    • Russell 1,200 to 1,110 is 90 points so 20-point bounces (rounding) to 1,130 (weak) and 1,150 (strong)

    So all over the weak bounce (with RUT just over at 1,131) and all about half a point from strong and, if the rally is real – the strong bounce lines should NOT act as a lot of resistance.  Also very important is the 50 dma on the Nasdaq at 4,380 and it's just 10 points over that, which should gap over this morning – so it's a question of whether we hold it.  

    Right now, it's all about tensions easing in Israel and Ukraine (Iraq still up in the air) but, if the economy was driving this bounce, then oil wouldn't be under $98.50, gasoline wouldn't be under $2.80 and copper wouldn't be under $3.20 – so let's watch for those too.

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    I still feel better about being cautious but we're not going to fight the charts.  We went bullish on S&P last week with the SSO spread but, so far, this is just the bounce we expected – not a rally. 


  129. PNRA/Kinki – I still like them for a new entry, they simply went down with the market.

     FF/Bdon – Not my area of expertise (biofuels/biochemicals) but they make money and they grow, so I like the stock.  Plenty of cash, not much debt and a hot sector that does lead to high expectations but I think $14ish is back to fair value for them.  The trick is, I couldn't tell you if, long-term, these guys are winners or not since I don't know the sector well.   I do know that, at $14.29, you can sell Feb $12.50 puts for $1.10 and $12.50 seems like a fantastic entry so I'd consider that "free money" and that means you can use it to buy the $15 calls for $1.20 and that means you now risk owning the stock for net $12.60 against an unlimited upside over $15 (high was $22), so that's a fun way to gamble on them.  If you want to be more conservative, the $12.50/17.50 bull call spread is $1.90 and that less the $1.10 is 0.80 for a spread that's $1.80 in the money to start.

    Leap strangles – we can discuss in chat today if people are interested but I have to write a post.