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Which Way Wednesday – Japan’s GDP Plunges 6.8%

MORE FREE MONEY!!!  

That's all this chart says to traders this morning, who are taking the European Markets up over half a point this morning and are goosing our Futures by half a point as well as bad news is good news and TERRIBLE news is even better in this Central Bank-sponsored market.

Private Consumption in Japan fell 5% in April, May and June and wages dropped 1.8% while sales taxes rose 3% and – PRESTO – there's your 5% decline in Private Consumption.  

Obviously, giving the workers more money is out of the question in a Conservative Capitalist Economy like Japan and we're certainly not going to tax Corporations when we can raise sales taxes that disproportionately target the poor instead so the only solution is:  MORE FREE MONEY!!!

Japan has increased their monetary base by 50% since last year and this year they are on track to add another 25% to pump it up to 270,000,000,000,000 Yen.  In March of 2000, there were just 50Tn Yen in circulation so a 5x increase in the money supply and NONE of it ended up in the hands of the bottom 80% who, just like in America, saw their standard of living DECREASE over the past decade and a half.  

It's a great race to the bottom in annual GDP growth overall as essentially all of the economic gains in Japan and the US accrue to the top 10% (people and corporations) while the bottom 90% circle the drain on the "Road to Serfdom" that Hayek warned us about 70 years ago:

“It is one of the saddest spectacles of our time to see a great democratic movement support a policy which must lead to the destruction of democracy and which meanwhile can benefit only a minority of the masses who support it. Yet it is this support of the tendencies toward monopoly which make them so irresistible and the prospects of the future so dark.

"If we face a monopolist we are at his absolute mercy. And an authority directing the whole economic system of the country would be the most powerful monopolist conceivable…it would have complete power to decide what we are to be given and on what terms. 

“Probably it is true enough that the great majority are rarely capable of thinking independently, that on most questions they accept views which they find ready-made, and that they will be equally content if born or coaxed into one set of beliefs or another.

“What Tocqueville did not consider was how long such a government would remain in the hands of benevolent despots when it would be so much more easy for any group of ruffians to keep itself indefinitely in power by disregarding all the traditional decencies of political life.” 

In addition to that TERRIBLE GDP report from Japan, tomorrow we get Europe's GDP reports and no one is expecting much from that group, which accounts for 18% of the Global GDP.  We also had a surprising collapse in China's Aggreggate Financing (growth in the money supply) which came in at just $44Bn in July vs roughly $300Bn expected.  

Also, remember when they blamed the weather for the TERRIBLE Q1 Retail Sales Report?  Well, now it's August and July Retail Sales were up 0% and, for the year, ex-Auto we are up 0.1% (0.4% with autos).  0% is, as they say in the Harvard Business School, not good.  We are already short XRT (Retail ETF) in our Short-Term Portfolio (Member Only), using the Sept $93/88 bear call spread at $3.20, which will pay $5 (56% profit) if XRT stays below $88 into September expirations (40 days).  Looking very good now!  

That trade idea was from our Live July 1st Webcast, we do those every week for our Members and, if you'd like to learn how to make 56% in 84 days – you can join us right here.  

In fact, we had a Webinar yesterday where we went over our Long and Short-Term Portfolios which are up a combined 20% for the year so far and holding steady, though we're a bit too bullish so, this morning, I sent out an alert to our Members calling for Futures shorts at Dow 16,575 (/YM), S&P 1,940 (/ES), Nas 3,920 (/NQ) and Russell 1,135 (/TF).  If you are lucky enough to be on our mailing list and reading this post pre-market (now 8:42) there's still time to catch the Russell, Nasdaq and Dow but the S&P has already dropped 2.5.  

I even tweeted out those ideas this morning (you can follow me on Twitter here) as well as posting it on our Facebook Page, so don't say I didn't tell you so. cool

Already (8:53) we're dropping off nicely and the Egg McMuffins are already paid for – which is how we like to start our trading days.  In fact, had the Dollar not plunged to 81.45 (down 0.25%) on the news of the Retail Sales report, our indexes would already be a lot worse but devaluing the currency our equities are traded for keeps them looking good long enough to sucker a few more dip buyers in before the rug is again pulled out of the "rally".  

We do have two doveish Fed speakers this morning (Dudley at 9:05, Rosengren at 9:20) so we're going to take quick profit on the Futures (ahead of Dudley) and reload if they manage to bounce us but already we have $250+ gains across the board, so no reason to be greedy.  If they don't manage to turn the markets up into the open (as is clearly planned) – then look out below as we're still not getting those strong bounce levels back on our Big Chart.  

 With EU GDP in deck tomorrow, along with Japanese Machine Orders tonight, I'm certainly not going to be enthusiastically long on anything going into the close.  If we survive that, we have our own PPI on Friday along with Industrial Production and E-Commerce Sales – all of which have the possibility of giving us a bit of good news to close out the week.  

But, for the moment – be careful out there!  

 


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  1. Good for our ARO trade possibly…

    hares in teen retailer Aeropostale Inc. (Ticker: ARO) earlier rallied to the highest level since June 2nd, perhaps after the stock was rated new ‘hold’ at Wunderlich Securities with an 18-month price target of $3.50 a share. The move in the price of the underlying spurred heavier than usual trading in upside call options on the name, perhaps as some traders take positions ahead of the company’s second-quarter earnings report on August 21st. Shares in ARO are currently up 3.5% at $3.49 after earlier rising as much as 9.0% to $3.68.

    The most traded options contracts on Aeropostale thus far in the session are the Jan ’15 3.0 strike in-the-money calls, with volume topping 16,000 contracts as of the time of this writing, versus open interest of just 1,412 contracts. Time and sales data suggests most of the volume was purchased for an average premium of $0.89 per contract. Traders long the 3.0 strike calls stand ready to profit at expiration in the event shares in ARO exceed the average breakeven price of $3.89. As the one-year chart below illustrates, shares in Aeropostale are down roughly 75% since this time last year.


  2. Phil/TF – TF is still at 1135, what kind of stop should we set in this situation?


  3. Phil/TF – Also, what kind of plummet should we expect for /TF?  10 points?  Or something smaller like 2-3?


  4. Oil Lines

    R3 – 98.77
    R2 – 98.31
    R1 – 97.73
    PP – 97.27
    S1 – 96.70
    S2 – 96.23
    S3 – 95.65


  5. Best and worst YTD stocks in the S&P 500 – best ones below, worst ones at the link:

    http://www.bespokeinvest.com/thinkbig/2014/8/11/top-performing-stocks-year-to-date.html


  6. That JOLTS report yesterday was pretty good:

    http://www.bespokeinvest.com/thinkbig/2014/8/12/jolts-report-shows-more-labor-market-strength.html

    The Job Openings and Labor Turnover Survey (JOLTS) report was released this morning by the Bureau of Labor Statistics (BLS).  This once obscure labor market panel has become increasingly important as the Yellen Fed looks to evaluate the broad labor market in much more detail in order to assess progress on its dual mandate of full employment and stable prices.  Much like the BLS's Employment Situation Report, the JOLTS report has a broad range of data that goes much deeper than its headline Total Job Openings number.  This month's report, covering the month of June, shows a continued trend of broad labor market strength, led by Total Job Openings but also visible in other underlying data points.

    Job Openings continued to surge in the month of June, reaching a level not seen since February of 2001, surpassing the mid-2000s highs in available and unfilled job openings.


  7. More on the NJ casino problems:

    http://qz.com/248230/why-the-enormous-casino-that-was-supposed-to-save-atlantic-city-is-shutting-forever/

    Losing business to neighboring states!


  8. Maybe more good news about jobs:

    http://qz.com/248244/the-us-economy-just-hung-up-a-giant-help-wanted-sign/

    Meanwhile a gauge of small businesses’ intentions to hire has also surged to a fresh post-crisis high, with 13% of respondents to a survey by the National Federation of Independent Business indicating their intentions to hire. That’s the largest percentage since September 2007.


  9. Hi Phil – I recently restarted my membership.  Its good to be back.  Is there a place where the various portfolios are being maintained?  Where I could see them as spreadsheets?  Thanks so much.


  10. rayne42 – the portfolio's are no longer maintained on a spreadsheet. I believe the most recent posting and review was last Friday's members chat… He will sometimes review them on Tuesday's webinar.


  11. Good morning!  

    SEAS turns out to have been an IPO that was all hot air!

     [$$] SeaWorld Shares Sink as It Slashes Guidance

    SeaWorld plunges 25% on lower revenue outlook

    ARO/Burr – I love it when it takes people a month to catch up to us!  

    ARO priced for BK and 2016 $3.50/5 bull call spread at .40 with stock at $3.17 is a fun way to play the upside if they are saved.  With $2Bn in revenues and very little debt, someone should want them for $250M in market cap so let's risk $2,000 in the Income Portfolio (50 contracts) on this one and $4,000 (100 contracts) in the STP with potential upsides of $7,500 and $15,000 coming back in 18 months.  If they get bought over $5, we get the whole thing much sooner!  

    ARO/Phil – can you expand a little more on why you think they are worth anything at all and not just a bankrupt brand ready for the back closet of history?

    Submitted on 2014/07/15 at 3:36 pm

    ARO/Scott- Because it's hard to build a known name brand and that alone has some value.  Then there's their manufacturing and distribution network and the sales space they've been able to muscle into on retail shelves (and on-line) that drives $2Bn in sales.  They are losing about 5% while GPS makes about 10% so somewhere between one and the other it is reasonable to assume a buyer can achieve.  Now, if the buyer were GPS or an off-brand outlet that wanted to cut out the middle men and put out their own jeans or SHLD that wanted to make them a store brand or whatever – it becomes kind of attractive at $250M with no debt (and $100M in cash). 

    If I'm GPS with $15Bn in sales dropping 10% to the bottom line and getting a p/e of 15 ($17.5Bn) with about $200M a year of FCF (after buybacks and dividends) and I buy ARO for $400M (+40%) it's going to cost me about $50M a year for 10 years but, assuming I can turn them around (and synergies abound) and drop even 5% to the bottom line – I MAKE + $50M per year and get an immediate $750M pop to my stock value which goes up anther $750M a year once I pay off the purchase – and that's without increasing sales or any drastic cost cutting.  

    That's the point at which I begin to get interested in a business, when I can begin to structure buyout deals with logical partners that are big wins for them with little risk.  

    /TF/Ricbah – They bottomed out at 1,132 at 9 (see above note to get out) and now back to 1,135 where they may make another short along with /YM 16,575, /ES 1,940 and /NQ 3,920 but /NQ is over so, if you take another poke – be very tight with stops over the line or wait PATIENTLY and short the laggard.  

    As to expectations, I try not to have any, then I'm not disappointed when I take a $50 gain off the table!  

    We're past our Fed speakers and they couldn't get us higher than the Futures pump so not a good sign.  

    Best/StJ – NFX and NBR are tempting shorts then with oil taking a dive.  

    Casinos/StJ – Should be good for the survivors:

    Jobs numbers look promising.  Up to the US (as usual) to pull the World out of a slump.  

    Hola Rayne!  There's a portfolio tab at the top right of the page but I usually review our 5 active portfolios on Thursday's and/or Fridays in the posts and also in our live Tuesday Webinars (1pm). 

    And what Eric said!  


  12. LEAP strangles/ meat on the bones. Just to conceptualize what a 'valid' set of trades could be, and playing with various combos, I thought the board might like to try this on for size.

    Pre-market 06/13/2014: S&P 500 @ 1933

    Anchor position:

    50 contracts; Dec 16 short SPX 1675/2200 strangle @ $199.50 = credit of $999,500.

    Buying power (according to TOS) $837,575

    Breakeven strikes 1475/2400

    % increase in SPX to reach sold call strike: 13.8%

    % decrease in SPX to reach sold put strike: 13.3%

     

    Selling short term strangles:

    Oct 14 – 64 days to expiration

    50 contracts; Oct 14 short SPX 1780/2090 strangle @ $11.70 = credit of $58,500.

    Buying power (according to TOS) $1,165,200

    % increase in SPX to reach sold call strike: 8.1%

    % decrease in SPX to reach sold put strike: 7.9%

     

    Total buying power used of initial anchor position together with sale of first front month strangle = $837,575+$1,165,200 = $2,002,775

     

    Jan 16 is 28 months away. Let's say we  continue selling $10 of premium a month with 50 contracts = $1,400,000 of sold premium

    Assume that 50% of the months will need to be rolled, so discounting 14 months where no premium will be collected gives: $700,000

     

    Total premium collected until Jan 16 = $837,500 + $700,000 = $1,537,500

     

    If we add 100% of the buying power to provide a cushion for repair trades, unfavorable movements etc, suggest starting capital needed approx $4 mio.

     

    Return of $1,537,500 on $4,000,000 = 38% over 28 months (approx $55,000 per month)

     

    Caveats & Points of Reflection

    Does this have merit or is it completely foolhardy?

    What is the probability of the S&P500 having a black swan event which will take it down more than 8% in a single month , and 13% over the life of the trade?

    Given the above, how feasible would be it be to roll both legs down or up, given a significant market event?

    Whilst the trade would appear to offer simplicity and avoid single stock risk, is this an efficient use of buying power?

    Is a 50/50 split of cash / buying power usage the right one?

    If one wants to take a directional stance, i.e. I think the S&P500 is more likely to go down than up, is there any advantage to selling more calls than puts?

    How risky is this combination compared to say the butterfly or LTP portfolios of PSW?

    In fact, how risky is this combination/setup?


  13. I love this Tweet:

    One has great faith that Divine Providence will sort out the great threats to world peace. The other is the Pope.


  14. Thanks Eric.  Is there anyway I can get a snapshot of them as they stand now?  Does that exist somewhere?


  15. POT is getting attractive for a LTP play.  Yield is good, and the stock is hovering on the 200d MA.  Sell some LT Puts.


  16. Here's why SQQQ is still the short of choice:

    With the Nas 5% higher than the others (at least) that tugboat effect is on and it's hard for the Nas to go higher without the others crossing over (so plenty of warning to get out) and it's likely it will be snapped down to join the group if they begin to fail the 5% gap they already have.  

    In the STP, we have the Dec SQQQ $43/50 bull call spread (40 @ $1.55) and they are now $3.60/$2.05, so the same $1.55 but SQQQ is at $40 and the $40 calls are $4.60 so, for $1 ($4,000), we can pick up $3 in position and add $8,000 more upside protection.  So let's do that and roll the Dec SQQQ $43s down to the Dec SQQQ $40s for $1 in the STP to tilt a bit more bearish

    That will then put us on the hunt for a nice, bullish play that will make $4,000 if the market doesn't collapse.  


  17. I also like 20 USO Aug $36.50 puts for .58 in the $25KP.  


  18. Strangles / Winston – Given current volatility, there is about a 25% chance of being above or below your December 16 strikes.Give or take 2%. That's 854 days from now…  Based on standard deviation calculations.


  19. /TF what is happening?  I thought TF was supposed to fall early in the day?


  20. StJ – thanks for that info. I like the odds of 75% chance it will be above! I've always found the calculation and relationship of SDs to probability of ITM a dark art. Could you share your calcs?


  21. Whoa, what is going on in America…. Taken….


  22. Pharmboy, 

    Your previous call on POT….thankyou.

    What strike 2016 are you looking to trade.  Thankyou


  23. Is it me or is the market feeling kind of bubbly again. 


  24. POT – STO Jan16 $30 Ps for a starter position (1/5 sale). 


  25. ITMN…..zoom zoom.  Hope you are in on that one…


  26. TSLA all-time high


  27. The Indian Animal Farm where (George Orwell )Orwell was born

    http://www.bbc.com/news/magazine-28739420


  28. ricbah/TF – Right now we're forming a wedge squeezie pattern. The top is IWM 113.13, and the bottom is the 20 simple on the 3 min chart. My guess is this will resolve to the downside and at least test the previous day close, if not the lows for the day. If it breaks above 113.13 I would close out shorts.


  29. Strangle/Winston – You should be able to answer your own questions.  Look at the 5-year chart of the S&P.  I see about 10 times in 5 years that the S&P has moved it up or down about 10% in a month – that's a lot of black swans!  

    While you CAN roll your legs, you will get two unfavorable spreads and the more pressure you feel to roll it, the more unfavorable it will be.  The real question is, are we able to otherwise use $4M in cash ($8M ordinary buying power) to make $55,000 a month (1.3%) in a "safer" manner.  

    The concentration of risk here means a single event can possibly wipe you out.  I'm not sure whether that fits any known definition of safe.  With SPX at 1,939, I can simply sell 500 Sept 1,545 puts for .95 to get $47,500 against $7.7M in ordinary margin and the S&P would have to drop 20% in a month to crush all your hopes and dreams on that one (though you'd get a margin call by 10%).  

    I'd feel a lot more comfortable selling 50 SPX Jan $1,750 puts for $27 ($135,000) and that requires just $990K in margin.  That's $27,000 a month for 5 months and an 8.1% annual return on $4M without risking it all on a single bet.  

    I do wish there were such "easy" ways as a strangle like yours to make money in the market but no, there are not.  Hard work and diligence will get you 20% returns but "set and forget" is only going to "safely" get you 10% (like the Income Portfolio) and, in a real black swan event (20% in a week), any passive strategy is going to wipe out a year or more of gains.

    LOL Pharm.

    Snapshots/Rayne – I'll be going over them tomorrow as Friday is expirations.  

    Taken/Pharm – Vice did a report on that, very nasty!  I was thinking about that driving through CT, where the cops are generally hard-asses.  

    Bubbles/Rustle – The worse things look, the more they will blow!  

    POT/Pharm – As long as they hold the 200 dma ($34), should be fine.  

    TLSA/Jabob – They opened a supercharger in London – WOW!!!  

    Cool QC, I love Orwell.  

    Oil Inventories coming – I hope I guessed right!  


  30. Phil – Any suggestion for shorting WMT on an earnings play?

    My thesis is that Bentonville, AR is now infested with corporate idiots and that it is getting much more difficult to hide their sheer incompetence. Lack of a proper education at the corporate level is an interesting case-study of their new business plan in action! ;-)


  31. When do the leases expire on the first set of TSLA that were guaranteed at a ridiculous high residual value by TSLA.  With that consumer reports article showing all the things that go wrong with a TSLA in just 15000 miles, I'm wondering how that residual will hold up.  I want to buy puts close to that time on them as they will lose a few hundred million in the difference in cars they have to buy back.


  32. WMT/Diamond – We just went middle on them by setting up a butterfly and that's how I'd play them, neither up or down. 

    Build of 1Mb in Oil and we're testing $97, gasoline down 1.2M and distillates down 2.4M so out of the $25KP USO $36.50 puts, now 0.68 as it's not a slam dunk and we don't have time to be wrong


    • Crude +1.4M barrels vs. -2M expected, -1.8M last week.
    • Gasoline -1.2M barrels vs. -1.1M expected, -4.4M last week.
    • Distillates -2.4M barrels vs. +0.2M expected, -1.8M last week.
    • Futures -0.27% to $97.11

  33. Greg

    Did you ever post the webinar from yesterday? THX.


  34. Phil/TF – I need advice, I got in short on /TF at 1134.5 without a tight stop because /TF was being bouncy and I didn't want to lose money just to have it go back down into the range where I would have made money.  Now the market has been trending upwards and has reached 1136.5… is this just a day high or what should I do?


  35. /TF now 1137.5…


  36. Hi Dan, Unfortunately, the replay hasn't been posted yet. It's not available from webex yet. (I called them a few hours after the webinar yesterday when I still didn't see it, and was told "recordings can take up to 24 hours to post". I'll be calling their support line shortly, because the 24 hours is almost up and it's still not showing in our account.)


  37. Pharm

    Any trades on these 4 companies

    Thanks

     

    Alnylam Pharmaceuticals Inc. (NASDAQ: ALNY)

    Amicus Therapeutics Inc. (NASDAQ: FOLD)

    BioCryst Pharmaceuticals Inc. (NASDAQ: BCRX)

    Neurocrine Biosciences Inc. (NASDAQ: NBIX) 


  38. Ricbah – don't panic, I am in at 1136.20 a minute before it popped to 1138. It almost always gives you they chance to make money by coming back to you, if you have patience. Of course you need to pull the trigger when it does, or it could pop right back and you have to start over and wait for it again.


  39. Standard deviations / Winston – It's done automatically in my charting software.


  40. Craigs – thanks, I am kind of panicking right now.  I put a stop at 1140 because i refuse to lose more than that, but I am hoping based on what i have read here that it should come back down.  It's pretty stressful seeing that right now every time the MACD lines are crossing on this uptrend, it spikes up instead of spiking down


  41. Ricbah-Of course there are also days where it just keeps climbing. Usually , Phil gets it right, but some days the market defies logic and we take our lumps. Good luck.


  42. Greg:

    Not a problem. Thanks.


  43. Phil/TF – Do you have any thoughts on this discussion between Craig and I?


  44. TSLA/Rustle – Long wait before it really starts to bite them and Musk already has a subsidiary (Tesla Finance) set up to take the fall:

    The estimated effective cost of $408 a month sure sounds great but, just as with the first consumer lease plan for the Model S, there are a lot of caveats to be aware of. For one thing, the actual monthly payment is $1,012, well over twice the $408 number. Tesla estimates that you'll save $261 a month in gasoline costs and $343 a month in business tax benefits (with Tesla calculating a 40 percent effective tax rate and 70 percent business use). Those gas savings, "are calculated assuming $0.11 per kilowatt hour compared to paying $4.90 per gallon for premium gasoline with a fuel efficiency of 20 miles per gallon," so if your business already runs a fleet of Toyota Priuses, you can forget the $408 number. Oh, and the business lease program is currently only available in ten states – CA, CO, CT, FL, IL, MA, MD, NY, TX, and WA.



    Yes, that list includes Texas, where you can't officially buy a Model S. Tesla spokeswoman Shanna Hendriks told AutoblogGreen that the company has a lessor's license in the state of Texas, which allows it to offer the business leasing deal there. The dealership license, which the company can't get in Texas, is the thing that is preventing sales. No matter which of the ten business lease states you're in, the first vehicles under this program have an estimated delivery date of June 2014.

    Still, the company is taking the car back with less than $36,000 paid on an $80,000 car so they are on the hook for about $45,000 per 3-year old Tesla.  I'm sure Musk has a subsidiary lined up for that too – all sorts of fund games you can play shuffling money around when you have $12Bn (just ask Trump, who went "Bankrupt" in 1991, 1992, 2004 and 2009).  

    Figure 3,000 cars a quarter coming back starting Q3 of next year (not all are leased) and if he dumps them for $30,000 and can't hide the loss, it's a $15,000 x 3,000 = $45M hit per Q to look forward to – but I'd say that's worst case.  He lost $400M in 2012 and no one batted an eye.  

    Webinar/DC – Apparently, it takes WebX a day to process the recording.  That's why the delay – the longer I talk, the longer it takes.

    And what Greg said.  

    /TF/Ricbah – It depends on your risk tolerance but not only was 1,135 our stop out but we also needed the other indexes under 16,550, 1,920 and 3,920 to confirm.  We lost those a while ago and now the RUT is likely to hit 1,137.50 or even 1,140 before turning back with /ES 1,940, /YM 16,600 and /NQ 3,935 – that will be our next set of signals.  The whole point of picking entries at support/resistance line like 1,135 is BECAUSE they make clear places we can stop out and limit our losses to $50 or $100 while, if we get it right, we can make $250 to $500.   THE ONLY REASON THESE TRADES WORK IS BECAUSE WE RISK LOSING LESS THAN WE CAN GAIN.  If you allow yourself to lose $250-$500 – then it wipes out 5 $100 gains and it's not very likely we'll be 4/5 on the Futures!  

    I am, for the record, liking another short entry on /TF at 1,140 as long as we confirm /ES under 1,940, /YM under 16,600 and /TF under 3,935.  Dollar at 81.60 is no pressure either way.  

    For the $25KP, I like 5 of the next weekly $97 puts for $1.30 ($750) and I intend to DD if they hit $1.  

    Panic/Ricbah – If you really mean "panic", then you absolutely should not play the Futures, it's very easy to lose quite a lot of money very quickly.  


  45. Panic/Phil – I dont mean real panic (I'm not in financial trouble whatsoever), but it is stressful to see the market go horribly against you, this will be the last time I enter without a tight stop.


  46. Phil:

    "For the $25KP, I like 5 of the next weekly $97 puts for $1.30 ($750) and I intend to DD if they hit $1." 

    ??? What puts?


  47. TSLA / Phil – Compare with AMZN, they have not made any money in 15 years and they are still richly valuated.

    As long as John Chambers doesn't do your earnings CC, there is no problem losing money on a regular basis. Although Chambers might be good at explaining losses but that doesn't happen at CSCO!


  48. So now the RUT is at 1,140 (/TF) but the other indexes popped over so no play until they go below (and then we just short the laggard).  


  49. Update on replay: We broke WebEx.

    The tech I just spoke to told me that I'm not the first call he's gotten today about the recordings not showing up. As soon as they fix whatever they broke, I'll get the link up.


  50. Last time/Ricbah – Then consider it an investment in your education – a very good lesson.  I'll save you some money though by telling you we don't use hard stops – the bots trigger those if they find them.  That's why we like to use solid lines, they tend to naturally slow down the index and give you time to get out as buys and sells also congregate around those lines, giving you time to dump your trade.  

    OK, we'll try this again:  For the $25KP, I like 5 of the next weekly QQQ $97 puts for (now) $1.20 ($600) and I intend to DD if they hit $1.  

    Thanks DC. 

    Good point StJ.  

    Thanks Greg. 

    S&P flying now, up 0.75% – game off for Futures shorts until we see where we settle.  Not sure why so I'll read some news. 


  51. In the meantime, oil taking a nice dip!


  52. SolarCity opens new Nevada operations center

    11:04 AM ET · SCTY

    • SolarCity (SCTY +1%) is expanding its presence in Nevada through the opening of its new Henderson operations center.
    • The center will serve as the company’s regional hub to install solar for Nevada residents and businesses, starting this week. SolarCity has already received more than 1,500 new customers.
    • This expansion pushes SolarCity’s total Nevada staff to over 640 people.


  53. On the hour

    11:01 AM ET

    • Dow +0.33%.
    • 10-yr +0.23%.
    • Euro +0.09% vs. dollar.
    • Crude -0.43% to $96.95.
    • Gold +0.34% to $1,315.10.


  54. Ebola outbreak prompts Feds to ante up more development funds for BioCryst antiviral

    10:52 AM ET · BCRX

    • The National Institute of Allergy and Infectious Diseases (NIAID) exercises additional options to conduct Phase 1 clinical human safety trials and efficacy studies in non-human primates of BioCryst Pharmaceuticals’ (BCRX +3.1%) broad-spectrum viral therapeutic, BCX4430, an RNA-dependent RNA polymerase inhibitor that has demonstrated activity against more than 20 RNA viruses in nine different families, including filoviruses, togaviruses, arenaviruses, paramyxoviruses, coronaviruses and flaviviruses.
    • NIAID will pay BioCryst an additional $4.1M to develop BCX4430.


  55. Amazon gains, eBay falls on ChannelAdvisor numbers; Google data mixed

    10:37 AM ET · ECOM

    • ChannelAdvisor (ECOM +0.4%) clients saw a hefty 40.4% Y/Y increase in their July Amazon (AMZN +3.1%) same-store sales. That’s up from June’s 34.4%, and is easily the highest rate seen in the last 12 months. 38.2% of tracked Amazon GMV was fulfilled by Amazon, up from 29.8% a year ago.
    • On the other hand, eBay’s (EBAY -1.1%) same-store growth fell to 9.7% from June’s 12.3% Auctions -8.2%, fixed-price +12.8%, Motors +8%. ChannelAdvisor sees the numbers as a sign eBay “continues to face headwinds” from Google algorithm changes and a May data breach.
    • Search ad-driven same-store sales, which are dominated by Google (GOOG +1.3%) AdWords, fell to 7% from June’s 20.4%. While average order value (AOV) grew 6% and conversion rates 8%, mobile growth led ad prices (cost per click) to fall 7%.
    • Google Shopping/product listing ads (previous) continue to perform well: They saw 40.8% same-store growth, down a bit from June’s 47.8%. Conversion rates fell 9.5%, but AOV grew 8.9% ChannelAdvisor thinks mobile is hurting conversion rates, and that Google is “counteracting that by showing higher-priced items.”
    • Amazon also rallied following ChannelAdvisor’s June numbers. Shares tumbled a couple weeks later due to the bottom-line concerns caused by Amazon’s Q2 report.


  56. Knightsbridge Tankers beats Q2 estimates, still sees drybulk market recovery

    10:30 AM ET · VLCCF

    • Knightsbridge Tankers (VLCCF +7.5%) opens with strong gains after reporting Q2 earnings of $0.14, easily beating the analyst consensus estimate of $0.03.
    • Q2 average daily time charter equivalent earned by capesize vessels was $15K, compared with $25.2K in the preceding quarter; capesize vessels earned $11.9K/day in Q2 vs. $16.3K/day the Q1 but still almost twice as much as the same quarter in 2013.
    • Says the weak drybulk market in Q2 has continued into Q3, but VLCCF is still confident of a recovery in the market later this year; with a targeted cash breakeven rate below $15K/day, says is in a strong position to benefit from an expected recovery.
    • VLCCF says it will seek to grow dividends as the dry bulk market recovers and newbuildings commence operation.


  57. Department store and big-box retail stocks slide

    10:26 AM ET · JWN

    • Department store stocks are lower after Macy’s misses estimates with its Q2 report and warns on consumer spending.
    • Decliners: Nordstrom (NYSE:JWN) -2.2%, Sears Holdings (NASDAQ:SHLD) -1.8%, Kohl’s (NYSE:KSS) -2.7%, J.C. Penney (NYSE:JCP) -2.1%, Bon-Ton Stores (NASDAQ:BONT) -3.5%, Dillard’s (NYSE:DDS) -2.2%.
    • The downward comp sales revision from Macy’s and the flat reading on U.S. retail sales growth appears to be impacting big-box retailers Target (TGT -1%) and Wal-Mart (WMT -0.9%) as well.


  58. Taken/Pharm – thanks for posting. that is bad bad law.


  59. Phil – Thanks, I appreciate all of your responses.  


  60. Business inventories in-line with estimates in June

    10:01 AM ET

    • June business inventories: +0.4% to 1,743.1B vs. +0.4% consensus and +0.5% prior.
    • Sales +0.3% to $1,346.7B.
    • Inventory/Sales ratio at 1.29.


  61. Aug Atlanta Fed BIE at 2%

    10:00 AM ET

    • Aug Atlanta Fed BIE: +2.0% vs. +1.9% in July.
    • Respondents indicated that, on average, they expect unit costs to rise 2.0 percent over the next 12 months.


  62. Chiquita Brands in play?

    09:59 AM ET · CQB

    • Shares of Chiquita Brands (CQB +1.1%) are now 4.3% higher than the offer price the company received from Cutrale Group and Safra Group as investors bet on a bigger banana buyer showing up down the road.
    • MKM Partners thinks it will take an offer of $16 per share to get Chiquita to bite.
    • PepsiCo (PEP +0.1%) and Fresh Del Monte Produce (FDP) have been thrown out as potential bidders.


  63. LiveDeal +19.5% after reporting 340% FQ3 revenue growth

    09:48 AM ET · LIVE

    • LiveDeal (NASDAQ:LIVE) had FQ3 revenue of $2.67M, +293% Q/Q and +340% Y/Y. Net loss totaled $1.5M, up from $976K in FQ2 and $511K a year ago.
    • Gross margin was 11%, down sharply from FQ2′s 64%. G&A spend totaled $1.61M, and sales/marketing spend $160K.
    • The restaurant deals platform ended FQ3 with $10.3M in cash, up from $9.6M at the end of FQ2.
    • Press Release, 10-Q Filing


  64. Confidence in Ford picks up

    09:53 AM ET · F

    • Stifel Nicolaus upgrades Ford (F +1.1%) to a Buy rating from Hold on its view that sales growth will remain strong and operating margins will outperform.
    • The boost in confidence in the Detroit automaker comes ahead of its F-150 aluminum launch which has set a cautious tone at some Wall Street firms.
    • Stifel’s price target of $22 implies 26% upside for shares of Ford.


  65. Six-year low for U.K. unemployment

    09:20 AM ET · FXB

    • The U.K.’s unemployment rate fell to 6.4% in Q2, the lowest since late 2008 and down from 6.5% in May, says the Office for National Statistics.
    • Average wages excluding bonuses rose by 0.6% in the year to June, the slowest rise since records began in 2001. Including bonuses, wages fell 0.2%, the first fall since 2009.
    • Wage growth is “remarkably weak” and there is enough slack in the economy to keep the benchmark rate at a record-low 0.5 percent for now, says Governor Mark Carney. With inflation accelerating to 1.9% in June, real wages for many Britons are continuing to decline.
    • The pound is -0.6% at $1.6716, while the FTSE is +0.1%.
    • ETFs: FXB, EWU, GBB, FKU, EWUS, DXPS, DBUK


  66. Iron ore drops to eight-week low as China credit gauge plunges

    08:59 AM ET · BHP

    • Iron ore prices sink to their lowest levels in nearly eight weeks as a credit gauge in China plunged, adding to worries about slowing demand.
    • China’s broadest measure of new credit slumped in July to the lowest level since the global financial crisis; prices already had tumbled 31% YTD as mining companies increased output, pushing the market into a glut.
    • BHP -0.8%, RIO -3.5%, VALE -0.2% premarket.


  67. Price targets on Macau casino stocks lowered as growth cools off

    08:57 AM ET · LVS

    • Bank of America Merrill Lynch lowers targets on Las Vegas Sands (NYSE:LVS) and Wynn Resorts (NASDAQ:WYNN) due to the decelerating revenue growth trends in Macau.
    • BAML price targets: LVS to $88 from $95; WYNN to $260 from $270.


  68. Land Rover recalls 40.5K vehicles in the U.S.

    08:49 AM ET · TTM

    • Land Rover (NYSE:TTM) recalls 40.5K vehicles in the U.S. due to a potential airbag issue.
    • The recall action covers LR2 luxury compact SUVs from model years 2010-2015 and Range Rover Evoque SUVs from 2012-2013.


  69. Canadian Solar +8% after beating expectations as shipments, prices rise

    08:39 AM ET · CSIQ

    • Canadian Solar (NASDAQ:CSIQ) +8.1% premarket after posting better than expected Q2 earnings and revenues, led by strong module demand out of Japan, Germany, the U.K. and the U.S., as well as progress in the build-out of utility-scale solar projects in Canada
    • Q2 solar module shipments totaled 646 MW vs. company guidance of 600-630 MW, 500 MW in Q1 and 455 MW in the year-ago quarter; Q2 solar module shipments included 70 MW used in the company’s total solutions business vs. 49 MW in Q1 and 35 MW a year ago.
    • Q2 gross margin widened to 19% from 12.8% in the prior-year period.
    • Issues in-line guidance for Q3, seeing revenues of $760M-$810M vs. $784M analyst consensus, with module shipments of 720-750 MW; expects gross margin of 19%-21%.
    • Says it is in a position to launch a yieldco, and will discuss the potential for an early 2015 launch.


  70. Macy’s read: Are department stores getting crowded out?

    08:38 AM ET · M

    • A warning from typically-resilient Macy’s (NYSE:M) on consumer spending could send a chill into the retail sector.
    • CEO Terry Lundgren says that many of the department store’s customers aren’t feeling comfortable about spending more in an “uncertain” economic environment.
    • That analysis from a sector bellwether indicates a crowding out effect could be in play as consumers spend freely on housing, automobiles, and travel.
    • On watch: KSS, JWN, DDS, JCP, BONT, LB, TLYS, CACH.
    • Consumer discretionary-focused ETFs: XLY, XRT, VCR, RTH, RETL, FXD, FDIS, PMR, RCD


  71. Macy’s lower after sales and margins miss estimates

    08:21 AM ET · M

    • Macy’s (NYSE:M) reports comparable-store sales rose 4% in Q2. The tally includes sales for departments licensed to third parties.
    • Gross margin rate -40 bps to 41.4%.
    • Merchandise inventories -2.5% to $5.42B.
    • Guidance: Full-year EPS range of $4.40-$4.50 maintained; comp sales gain of 1.5% to 2% forecast.
    • M -4.2% premarket


  72. SeaWorld tumbles after sales and guidance disappoint

    08:06 AM ET · SEAS

    • Shares of SeaWorld (NYSE:SEAS) tumble in early trading after the company misses estimates with its Q2 report.
    • Soft traffic trends have continued for the company into the peak season.
    • The theme park operator expects 2014 revenue to fall 6% to 7% to $1.46B vs. $1.50 consensus.
    • SEAS -12.7% premarket


  73. Glencore posts solid growth in copper, coal but nickel, zinc output dip

    07:49 AM ET · GLCNF

    • Glencore (OTCPK:GLCNF, OTCPK:GLNCY) reports H1 copper production rose 13% Y/Y to 741K tons, thanks largely to an increase in capacity at its Congolese operations and a better performance from the Collahuasi mine in Chile.
    • Coal output rose 5% to 71.2M tons, with an expansion at its Australian mines mitigating some of the effects of a long strike at its Cerrejón mine in Colombia.
    • However, the closure of two Canadian mines last year was partly to blame for an 11% fall in zinc production to 650K tons, and the shuttering of nickel mines in Australia and the Dominican Republic was reflected in an 8% reduction in output to 49K tons.


  74. More on Deere’s FQ3 results

    07:46 AM ET · DE

    • Net income of $850.7M, or $2.33 per share vs. $996.5M, or $2.56 per share, for the same period of 2013.
    • Net sales decrease 5% Y/Y to $9.5B from $10B in the same quarter a year ago.
    • For fiscal 2014, the company expects sales to decrease 6%, and to be down ~8% for the fourth quarter compared with the year-ago periods. Net income is anticipated to be approximately $3.1B.
    • FQ3 results
    • DE -0.4% premarket


  75. Traffic dips at SeaWorld in Q2, new buyback approved

    07:41 AM ET · SEAS

    • SeaWorld (NYSE:SEAS) reports attendance rose 0.3% to 6.6M in Q2.
    • Guest spending fell 1.8% to $61.54 per visit during the period.
    • The company notes last year’s comparable included the opening of its largest expansion ever with the Antarctica: Empire of the Penguin section at its Orlando park.
    • A new stock buyback program of $250M has been approved by SeaWorld.


  76. Hang Seng hits highest level since November 2010

    07:28 AM ET · FXI

    • Hong Kong extended its winning streak to three overnight, the Hang Seng rising 0.8% to 24,890 – a level last seen nearly 4 years ago.
    • Economic data released ahead of last night’s session showed further slowing in China’s economy, with industrial production slumping to 9% growth from 9.2% previously, and retail sales growing 12.2% vs. June’s 12.4% and expectations for 12.4%.
    • Shanghai closed with marginal gains.
    • ETFs: FXI, PGJ, GXC, YINN, FXP, YANG, MCHI, XPP, YAO, YXI, CHXF, CN, FCA


  77. Craig/TF – What did you end up doing?


  78. Women retail shops get once-over by investment firms

    07:27 AM ET · GES

    • Piper Jaffray cuts estimates on Guess (NYSE:GES) after seeing Kate Spade (NYSE:KATE) throw a scare into the sector during its earnings call by signaling it might push its EBITDA margin goal out a year.
    • Wedbush Securities analyst Corrina Freedman thinks the 25.4% drop in Kate Spade yesterday was overdone. The investment firm is a buyer at current levels.
    • Piper lowers its outlook on profit margins for Guess and drops it price target to $29.


  79. Pound slides as BOE slashes wage-growth forecast

    07:23 AM ET · FXB

    • In its quarterly inflation report, the Bank of England halved its forecast for wage growth this year to 1.25%.
    • Expectations had been for the bank to begin hiking rates later this year or early next, but officials signaled the weak wage growth could forestall any such move. “In light of the heightened uncertainty about the current degree of slack, the committee noted the importance of monitoring the expected path of costs, particularly wages, in assessing inflationary pressure.”
    • Sterling is lower by 0.6% to $1.6706.
    • ETFs: FXB, EWU, GBB, EWUS, FKU, DXPS, DBUK, QGBR


  80. Amazon unveils mobile credit card reader

    06:17 AM ET · AMZN

    • Jumping further into the mobile payments market, Amazon (NASDAQ:AMZN) has unveiled a credit card reader to take on devices made by Square, PayPal, and a range of other companies.
    • The new gadget expands the online retailer’s presence in the brick-and-mortar world, and will give the company data on how U.S. consumers shop offline.
    • Amazon will compete with rivals by charging lower fees per swipe.


  81. Banks lobby to delay Volcker rule

    03:14 AM ET · JPM

    • Bank officials, trade groups and lawmakers are quietly pressing the Federal Reserve for a delay of up to seven years regarding the rule that limits their investments in private-equity and venture-capital funds
    • The “Volcker rule,” part of the Dodd-Frank legislation, restricts banks’ ownership stake in hedge funds and private equity funds, and prohibits banks from making speculative bets with their own money.
    • Regulators finalized the rule in December but agreed not to enforce it until 2015.
    • Related tickers: JPM, C, BAC, WFC, GS, MS, BK, STT, ZION


  82. AOL to issue first bond offering since 2009

    02:55 AM ET · AOL

    • AOL (NYSE:AOL) has announced its new offering of convertible notes, as an effort to raise $300M to be used toward potential acquisitions. The company also plans on using $50M of the raised money to repurchase shares.
    • Until recently, the company only depended on cash generated from internal operations and asset sales to fund its growth.
    • The offering marks the first time AOL has issued bonds since it was spun off from Time Warner in 2009.


  83. Target to fix botched Canadian expansion through supply chain reset

    01:58 AM ET · TGT

    • Target (NYSE:TGT) is planning to fix its disastrous Canadian expansion through a three-pronged turnaround plan which will focus on supply chain management, pricing, and merchandise selection.
    • After opening 124 stores and three distribution centers in Canada last year, the discount retailer’s expansion over such a short time frame led to a nearly $1B loss.
    • The supply chain “reset” comes as new CEO Brian Cornell takes the reins at the company.
    • Target cut its second-quarter profit estimate last week and said Canadian sales were softer than expected. The company is scheduled to report results on Aug. 20.


  84. Pharmboy;  Thoughts on CERS and ARIA.  I have spreads expiring this week.


  85. Mobile credit card readers: This I don't understand. Korea has had this stuff on smartphones for years; I can even use it to pay bus fare. Just sort of wave the phone at the fare box while hopping on board.


  86. Last time we had a momo squeeze like this, about 3 weeks ago, we fell next day.


  87. can someone explain how to DD? thanks


  88. Found this interesting:  Wall Street's Brightest Minds Reveal The Most Important Charts In The World

    http://www.businessinsider.com/bi-most-important-charts-in-the-world-2014-7


  89. doriz

    It is short hand for doubling down on a position. If you start by buying 10 puts and the play goes against (in this example), then at a certain price target you buy the same amount of your first entry  reducing your overall average price (hence, Phi's trade from above).


  90. jbur:

    That's a lot of charts! :)


  91. TSLA – well, just took a week longer to get to 260 than I bot a butterfly for..  


  92. Phil/Strangled Answers; I always like your answers much better than mine! But to leave it there would be doing myself an injustice. I like the risk/reward of the Jan 15 short puts. However, why not use that position to start selling front month far out of the money calls? The Sep 2000 calls can be sold for $4.70 – hang on a minute I feel an answer coming on – those goddam calls chew up $335,000 of buying power – are you crazy Winston. There are plenty of other puts and calls that can be sold for that amount of premium for much less buying power!!!! You see, this one sided Q&A just doesn't have the same feel about it. 


  93. Ricbah- I am still hanging in waiting for the inevitable pullback. which I think may be in the process of happening now. I normally would have DD at 1141, but didn't want to tie up the funds today in case I bet wrong.


  94. thanks dclark


  95. Craig – It looks like you are getting your wish.  I want to get back in and ride this downward motion, but I'm still nervous after the loss I took.


  96. Ricbah- Futures takes balls of steel and you can miss your exit in a matter of seconds if you take your eye off it. Also you need to be able and willing to take losses sometimes and you hope that your gain days outnumber your loss days. It's really not for everyone I think. I like it and am learning to wait out the swings, although sometimes it does just keep going in the wrong direction and you need to be able to handle those days.


  97. Craig – I am finding that out, haha!  I just started trading futures last Thursday, so I am still getting the hang of it all.  I appreciate your more seasoned perspective though.  How long have you been trading futures?


  98. Phil
    On the weekly QQQ is that more of a day trade and just get what we can, or is it a hold until expire trade? I’ve not been around long enough to see one of the weekly traded in the 25kp yet so just curious.


  99. Ricbah- I am out now at 1137.90 with a small loss today until I see a move or get some kind of direction. Feels like it wants to go up from here, but of course who knows. I don't want to sit here rooting for the market to go down. I'd rather get out and wait for another day or time when direction seems clearer than at this moment. 


  100. Craig- Good call.  Thanks for your responses!


  101. Pharmboy

    That is the scariest thing ever written. Time for revolution!


  102. ANGELCUR12:34pm

     

    .marketwatch.com/story/proshares-launches-etfs-offering-pure-exposure-to-high-yield-credit-2014-08-07 

    "a humanitarian mission into Ukraine must be backed by Kiev & under control of a trusted org. Anything else would be an attack on Ukraine sovereignty." -Supreme Allied Commander Europe

    ill be surprised if there isn't at least a period of angst over this convoy next couple of days….i skeptical ukraine is this dumb…but even if they are…i would think there will be a period of tenseness

     


  103. Ricbah- I have only been dedicated to this for about 8 months, and only in the last two months do I feel like I have a clue. I still have a lot to learn, but if you really pay attention for a few months, you can see the trends and how it moves and especially with  Phil's calls as a guide you start to see the sense of what he does. I must reiterate that you can miss the move in a few seconds some times. I got up to go to the bathroom one day and missed my opportunity to exit a position profitably and had to wait for a nervous 24 hours to get back to that spot, taking large paper losses overnight. Fortunately I did really well the next day by holding and I think it ended up being my most profitable trade. One last caveat, don't get cocky. I had a few winning days in a row and tried to do bigger positions (trading two and three contracts at a time) and trying to make money in both directions and got caught in a big move that took me two weeks to erase the losses going back to following Phils advice. He says you have to know when not to play too, and that is very true. I got cocky and tried to do it on my own and make a killing in a few days using my couple months experience instead of Phils years/decades (don't want to age you too much Phil) and that was stupid. I hope I have helped and not blasphemed PSW gospel, but that is my two cents.


  104. Phil bad bonds are back

    Subprime loans on business properties after auto loans and 2 weeks ago I just pointed these out now we have those links as no one believes me. All Dodd/frank did was shut down small home loans and construction.

    https://finance.yahoo.com/news/wall-street-faces-pushback-mortgage-095210207.html


  105. Anglecur- what must be concerning to Ukrainian officials is if a truck or two is hit with russian rebel artillery and then russia blames Ukraine and seizes the donetskaya krai (region) or sends in peacekeepers, a very real possibility. 

    pharm- when will the PLX bloodletting stop!?! How much lower does this company go before it is too compelling of a buy? 


  106. Now good signals with /ES failing 1,945 and /NQ failing 3,945 and /TF failing 1,140 – Need Dow 16,600 to confirm along with 1,940 3,940 to feel good about being short. 

    You're welcome Ricbah – I hope it comes back down for you.  

    Readers/Snow – This country is very behind on that sort of thing.  

    Squeeze/Rustle – That's why I'm liking the SQQQ and QQQ short positions.  

    Most Important/Jbur – After 20+, just seems like charts.  

    Brazil Prez Candidate dies in plane crash.  Things that make you go hmmmm………..

    LOL Winston – now you know what it sounds like inside my head!  Yes, I would feel better about selling puts and calls and collecting double but you are still exposed to that black swan event(s).  Noting is without risk – the cash under your mattress is ravaged by inflation, the cash in the bank risks default and collapse of the FDIC (almost happened just 6 years ago) and, while you can say both are a 10% risk, that's still every year vs pursuing a strategy that pays you 20% and risks losing 20% but, if successful just 7 years out of 10, will net you +80% (assuming the losses completely cancel out 3 gains).   

    Here's a chart that shows you what to buy for the next 10 years:

    CAT, IBM and T have not run away but it's very hard to imagine a scenario in which they don't exist 20 years from now.  That means any plan that essentially bets simply that they don't drop 50% over two years has a reasonable chance of success.  

    CAT is $105.24 and I can buy 10,000 shares for $1,052,400,000 and sell 100 2016 $100 calls for $12.50 ($125,000) and sell 100 2016 $90 puts for $6 ($60,000) puts me in 10,000 shares at net $86.74 ($867,400) and returns $132,600 (15%) plus 6 dividend payments of .70 ($7,000) for another $42,000 which brings the return up to $172,600 (20%) over 18 months.  

    Now, if all goes well, you either get called away or have an easy roll to next year.   If CAT drops lower than your $86.74 net (-17.5%), you may have a loss but, even if you had sold, for example, Aug $125 puts for $12.50 in 2012, with the stock down 20%, they are "only" $20 now and they can be rolled to the 2016 $110 puts at $15.50 for just $4.50 (which you'd collect by selling calls).  

    So the real key to pursuing a buy/write strategy over time is that it gets BETTER every year and your risk gets lower and lower and lower with each success but the index strangles reset your risk every cycle back to where you were on day one.  You never get ahead of the game and that's why one black swan (and there are many) can kill you while CAT, one day, will have a basis of zero for you (unless called away with a profit) and will still have value and will still pay a dividend.  

    If the economy collapses, the S&P is a meaningless construct but, if you own CAT, MCD, T – you own companies that people will still need/want in a barter society.  Even if we end up trading clams and beads, there will be a clam and bead special for a Happy Meal at McDonalds.  That's what safe INVESTING is all about.  Buffett says that he buys investments based on the assumption that they could close the markets and not re-open them again for five years.  If you can't pass that test, then your investment is not safe at all. 

    Oil testing $98.50 yet again. 

    16,600 holding up on /YM so far – annoying.  

    /TF/Ricbah – Losses are part of the game.  It's like trying to be a boxer and quitting because the other guy hit you.  The idea is to win more often than you lose and try to avoid getting knocked out.  Keep scoring points and eventually you learn to win pretty consistently.  

    1,137.50 held so out for me on /TF.  Now waiting for next confirmed cross.  

    QQQ/Dforster – As it's a $25KP, I don't want another day trade this week (3 limit) so the intention is not for the quick profits on this one.   If we get a good dip tomorrow though….

    Nice work on /TF Craigs, that's exactly how you should do it.  

    Loans/Shadow – Our trouble are nothing compared to the volcano that is going to erupt in China.  They arrested people who tried to do due diligence on their companies!  

    Humphrey's detention on charges of corruption was especially ironic: His business made its money helping multinational companies to root out fraud in their China operations, mainly by gathering background information on employees and partners and verifying audits. When the charges were finally announced on August 19, Humphrey and his wife were accused not of corruption, but of violating a new law aimed at curbing corporate investigations. Police charged the couple with illegally purchasing personal information, including I.D. numbers, automobile and home ownership records, family member names and details of cross-border travel. Though the details are not public, GSK appeared to be employing ChinaWhys to ferret out the very corruption scandals for which the company is now being prosecuted.

    The information crackdown has had even more far-reaching consequences for businesses, and from the government's perspective, some of the most destabilizing releases of information in the past few years were financial. Starting in 2010, short-sellers revealed one major Chinese company after another as a fraud, embarrassing Beijing and sinking share prices of Chinese companies of all kinds. Exposés by The New York Times and Bloomberg on the family wealth and business ties of top Chinese officials, meanwhile, added to the pressure.

    Last year, Chinese authorities moved to tighten access to company records at local industry and commerce bureaus, often the only way for short-sellers, journalists and due diligence firms like Humphrey's to trace corporate ownership and expose the suspicious relationships that are a marker of fraud. In an article about the rule changes Humphrey wrote in May for the Association of Certified Fraud Examiners, he said: "As an anti-fraud worker in China serving purely corporate clients on corporate matters or in litigation support, I find this a very dark day for due diligence and forensics work."


  107. Ricbah- So, if I had done what I usually do and waited, I would be about even right now. I was busy trying to impress you instead and knew I had to go to doctor now, so I wanted out. Off to see surgeon for a hopeful all clear on my biopsies from last Friday sinus surgery! 


  108. http://www.bloomberg.com/news/2014-08-13/spanish-consumer-prices-drop-at-fastest-pace-since-credit-crunch.html

    so clear deflationary spiral coming….and calls for ecb qe intensifying which will accelerate spiral.


  109. Craig- Well I sure appreciate it, sorry you didn't get back to even.  If it is any consolation, you did better than me!  Good luck!


  110. phil qqq – still a slight gap on the daily chart between 96.41-96.60 — could be one final thrust to close that before we head down.. that would give you your dd opportunity at or below 1 on the 97 put too!


  111. Not for market hours, of course, but I would love to hear your opinion of this insanity???

    https://news.vice.com/video/the-islamic-state-part-1


  112. Phil or anyone else – what is the best way to check the latest portfolio's (long term, short term) – Specially for those that cant attend the webinar? new user here, trying to learn the way around. Thank you

    Ramanuja


  113. PSEC/Deano – I like what I've been learning so far. thanks for mentioning.


  114. Phil/Perpetuity: Big thanks Phil. Now you know why I ask questions.


  115. Ricbah- got bored in doctors waiting room and took a quick poke at oil futures at 97.43 and rode it down to 97.22 in about 10 -15 minutes and back even on the day. That's why I love this, although I did break my new rule of playing without Phil's guidance. I just felt like it was a good play there, and got lucky today. Could only do in a doctor who thinks his time is more valuable than mine and always keeps me waiting minimum 30-45 minutes. Typical surgeon. 


  116. Any thoughts on CSCO earnings tonight?


  117. JROM//KRAI KRAI: THATS A GREAT POINT


  118. Phil – I know you said you wanted to wait on going long oil, but what do you think about this trade.  

    Sell USO Jan16 33P, buy Jan16 35/40 bull call spread for 0.01c.  If oil crashes, you'd own USO at 33 which is probably /CL around 96 or 96.50.  If /CL rises to "normal" level at some point between now and Jan 2016, the spread would be profitable.

    Seems like a good RR.  Thoughts?


  119. PHIL/JROM EVEN KRAIZIER

    .i think low probability of positive outcome…im shocked ukraine this dumb

    not shocked msb-induced low volume manipulation prices in best outcome..

    KRAI REALLY KRAI (ok i am done w krai)


  120. Usually/Craigs – That's my problem when we have the Webinars, I keep trying to force trades to fit the time-frame – never a good move.  Still waiting for 16,600 to finally die on /YM to greenlight more shorts. 

    Spiral/Angel – Very strange action, Stagflation is coming in other parts.  

    QQQ/$25KP, Toe – $1.10 is the low of the day on those puts, not interested if we don't get $1 or lower, maybe tomorrow.  

    ISIS/Jabob – My opinion is the World is a messed up place and will remain that way for another 1,000 years.  The real solution is to strengthen the UN and lay down a set of laws and moral codes of conduct (Geneva Conventions) that we ABSOLUTELY will not tolerate being broken, anywhere, ever!  If not the UN, then I assume NATO, at least, can manage to agree on how people should act.  If you're not going to uniformly police conduct around the World – then you need to not keep randomly getting involved in it when it suits you. 

    Portfolios/Nraman – We'll review them tomorrow, as we do weekly (most weeks).  And welcome, by the way.  

    Questions/Winston – Socratic method rocks!!!

     

    Guidance/Criags – I'm glad, the whole idea is you'll learn to see those obvious opportunities.  I don't watch it all day long, plenty of good plays pass me by while I'm doing something else but I certainly find, most mornings, if I feel like making $50-200 3 or 4 times, I can find quick spots.  

    CSCO/Options – I don't think infrastructure is doing so well this Q.  JDSU got mangled, doesn't bode well for CSCO but I'll like them if they get cheap ($20).  

    Oil/Burr – LOL, well you did wait almost 24 hours, so I'll commend your "patience".  Given the current climate, I do think $95 should hold but if the economy gets worse (Globally) or peace breaks out in Iraq and Ukraine, $85 is in the cards.  Do you want to be a long-term owner of USO?  If so, great but, if not, then why are you constructing long-term commitments.   The trend is not your friend with long-term oil prices.  

    MSB/Angel – Notice super-low volume today.  Just 48M on SPY at 2:45.  It's the same BS that made us short in the first place – big volume down, low volume up:

    SPY
    Date Open High Low Close Volume Adj Close*
    Aug 12, 2014 193.61 194.15 192.94 193.53 73,599,400 193.53
    Aug 11, 2014 193.97 194.66 193.71 193.80 74,480,000 193.80
    Aug 8, 2014 191.46 193.37 190.95 193.24 114,867,300 193.24
    Aug 7, 2014 192.94 193.13 190.55 191.03 135,530,900 191.03
    Aug 6, 2014 191.11 192.89 191.08 192.07 94,673,700 192.07
    Aug 5, 2014 193.10 193.60 191.31 192.01 152,608,200 192.01
    Aug 4, 2014 192.87 194.30 192.05 193.89 91,083,700 193.89
    Aug 1, 2014 192.56 193.76 191.57 192.50 189,183,600 192.50
    Jul 31, 2014 195.61 195.78 192.97 193.09 183,089,000 193.09

    See – it's an ILLUSION!!!  


  121. Socratic method – unless it's ineptly applied as "guess what I'm thinking".


  122. Phil // KKR
    Call question. SImple, but never had this happen before – they've always been pretty cut and dry.
    KKR $23.25 ( bought at $25 )
    Sold Aug $23's for $0.15 
    So, my breakeven is $23.15, ( a call buy would be $23.25 + 0.35 // $23.60

    So, what happens to the short calls if they expire above the strike but not excercised ?
    If I'm called I would grab all the premium but take a loss on the shares, which I would simply repurchase ?


  123. Finally! I have a Replay link for you all! (Sorry it took so long.)

    http://bit.ly/PSW81214Replay


  124. The thing that will not die:

    WMT and KSS tomorrow AM.  

    Another thing that refuses to die (so far):

    Classic triangle squeezy thingy:


  125. KKR/Wombat – If you sold the $23 calls and KKR expires at $23.01+, then KKR will be taken out of your account and $23 will be deposited in it (if you leave the short calls open).  If you don't own KKR, you will end up short KKR at $23 (and with the offsetting cash).  

    Webinar Replay/Greg – Thanks.  

    You need to get a yellow box, like Savi and Terrapin so people will see when you post Vegas Info, Webinar links and stuff. 

    Notice above how oil in 2008 looks like the Nasdaq now?


  126. scottmi – glad you liked it. It generally sucks for selling options, but its a fine company and occasionally you can sell some puts on a dip.


  127. For a trader, this afternoon has seen no action whatsoever.


  128. Alnylam Pharmaceuticals Inc. (NASDAQ: ALNY) – sell some P OTM.  Sept $50s are nice and way way down there..also, high is 100 on that spike…maybe buy some December OTM BCS for gambling money.  They need to take the 200d MA with confidence.  Scientifically, need to look again.

    Amicus Therapeutics Inc. (NASDAQ: FOLD) – I am watching them.  Need to look a bit more into them again.  From my limited memory, things were a bit sketchy.

    BioCryst Pharmaceuticals Inc. (NASDAQ: BCRX) – nada.

    Neurocrine Biosciences Inc. (NASDAQ: NBIX) – I work in their building….I am waiting for them to book the conference room for two days.  When that happens…I will post and we will buy calls! :)

    ARIA & CERS/Options – ARIA play is dead.  I still have the stock.  CERS – don't know what you have, but they are in a big channel.  I would buy some stock or take the puts if they are STO.  Hold the stock.  You could sell the Feb156 $5 calls for a nice gain if they are the $5 Ps


  129. Action/Den – Would be a health pause if we were taking our strongs, but not all:

    • 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)

    Dow and NYSE are on the line but RUT 10 points off and /ES is NOT holding 1,140.  If this were day one or two of a pullback, it would be more impressive but this is our 14th session from the top and 4th from the bottom – we need to be doing better than this to recover.

    TSLA/Diamond – Looks like a double top to me because the forward p/e (if you buy that BS) is pushing 80 here, and that's for end of 2015.  Last time they tested $265, they plunged $80 (30%).  If they are getting stronger, the bottom of this channel should be 15% down at $225 but that would break the trend line the chart people are watching but it also happens to be the 50 dma at the moment.  


  130. VIX back to 13 though, people have certainly calmed down.  TLT 115.4, XLF $22.56 and that was goaaaaaaaaaaalllllllllllllllllll for selling more FAS calls – someone remind me tomorrow, please.  


  131. Short-Term Portfolio down to 130%, LTP 119.1% though so still net $725,000 – hopefully the market picks a real direction at some point.  


  132. Definitely. 


  133. I read somewhere that the Ferguson, MO police dept has body cams, but has not implemented them yet.


  134. Cisco with a small beat, ditto Netapps. Cisco repurchased about 7% of their outstanding stock in FY '14.




  135. Stocks Up, Bonds Up, Gold Up, Oil Up, Dollar Up, F’d Up
    http://www.zerohedge.com/news/2014-08-13/stocks-bonds-gold-oil-dollar-fd


  136. Detroit is drowning: Why our cities are in danger (and global warming’s to blame)
    http://www.salon.com/2014/08/13/detroit_is_drowning_why_our_cities_are_in_danger_and_global_warmings_to_blame/


  137. The Strangest Things I Saw When I Went To Russia
    http://www.businessinsider.com/strange-things-in-russia-2014-8


  138. Congressman Who Voted Against Minimum Wage Hike Complains He Hasn’t Gotten A Raise
    http://www.huffingtonpost.com/2014/08/13/lee-terry-minimum-wage_n_5674847.html?ir=Business&ncid=tweetlnkushpmg00000018


  139. Chicken crosses road in Oregon: Police investigate motive
    http://holykaw.alltop.com/chicken-crosses-road-in-oregon-police-investigate-motive?tu4=1




  140. TASR,palotay/phil,  Bratton says he wants the body cam but is in no hurry it seems to get them. Maybe dosen't trust his force enough yet?

    I noticed JDSU has positive earnings at least the last 4 quarters and went down each time announced, went down not just a little either.


  141. Oil right back to $97.32 and, keep in mind, it's sitting on 5-year support where it NEEDS to be a lot bouncier than this. 


  142. Can someone tell me a reason for not wanting to buy more contracts on more fluid markets (Indexes, /CL) during market hours (for the increased liquidity) besides the issue of potential increased losses?  I'm just curious if people here generally buy more than one contract?  I personally am more keen to buy 5-10 contracts at a time but would like to know if that is a terrible idea for some reason.


  143. Ricbah, a futures index like, say, the /tf has a notional equivalent of 100 x the index or about $114,000 per contract., so unless you're comfortable slinging a million dollars around at a time day trading, you should limit yourself to one until you have a proven history of positive trades over a considerable period of time.  You should really see how you feel about experiencing large, sudden losses with one contract before signing up for 5 or 10.



  144. Phil- the world IS a messed up place but the ISIL animals are the most deplorable terrorists ever. They are so extreme most terror groups find their methods barbaric. What is interesting and sad is how anti-Semitic protests and looting have taken place all over the world when Israel has killed 2000(ish) Palestinians (many Hamas terrorists) defending themselves from rockets being launched into their cities while there are no Muslim protests for the 500k Muslims killed in Syria or the tens of thousands killed in Iraq by other Muslims. What's scary is although radical Islamists might only make up 2-5% of the religion members that is 32-80 million people worldwide who want, "death to America" and To wipe Israel off the face of the earth. There is no appeasement with these people. This will not end until moderate Muslims rise up and violently oppose these extremists but I don't see it ever happening…. Instead a western city will get a nice dirty bomb from these animals http://time.com/2972050/iraq-terrorist-nuclear-materials-isis/ . It's a matter of when, not if….I just hope it's not us.  


  145. Ricbah – why are you keen to trade (buy and sell) 5-10 contracts at a time? Are you familiar with the future markets and how they work? Futures provide tremendous leverage and can move very rapidly in both directions for good reasons (financial news, political events, natural disaster, etc.) and for no clear reason (fat finger trades, market rumors, manipulation). Futures trading requires considerable discipline, risk control/management and experience. If you are new to futures trading, paper trade a few trades and monitor the experience… if your comfortable, then move onto trading a single contract and see how you react to gains and losses. Good luck. 


  146. Futures – Thanks for the responses, yes I have been following the futures markets through Phil with paper money and had positive results so I just started using real money last Thursday.  I took a big loss today, was nervous while I was losing it but felt just fine once I got out of the market at a loss, I will never let myself lose an amount that makes me too uncomfortable.  It was a good lesson for me.  Every loss is a lesson learned, I agree though I need to scale back to 1 contract until I get the hang of things.  Thanks again!


  147. This is to anyone following TSLA. After hours credit Suisse initiated coverage on tesla giving a PT of $325. Interestingly enough, the analyst is dan galves who you may remember as the analyst formerly at deutsche bank who was responsible for the big pump a while ago. As Phil said, looks like a double top but I'm sure the pumpers are getting desperate to keep this game going. After hours it looks like TSLA reached $262.95 which isn't that impressive but we will see what happens tomorrow morning.  I think they're running out of pumpers for this stock


  148. "Gold about to break free."  Gold seems cheap enough, and the prospect of future inflation real enough, to make gold seem almost a no-brainer.  But the prospect of the dollar accelerating up — take a look at the

    1, 3, and 5 year chart — it is not really losing any momentum -- and what I believe to be a serious possiblity — the Euro getting shredded by the continued dysfunctionality of the Eurozone currency regime — gives me considerable pause.  "Pause", as opposed to frantic dollar buying, because it's entirely possible that one reaction to severe Eurozone problems is a buying of gold, not dollars, as a hedge.  A conundrum, for me, anyway.


  149. Ricbah- One more comment for you. My only real losses in futures trading have come when I tried to up the ante and trade multiple contracts. Twice while doing that the market has spiked or fallen quite unexpectedly with big moves caused by something like an airliner being shot down over the Ukraine, or any crazy news event. Suddenly I was $2-3 down which translates to losses of $4000-$6000 in the blink of an eye.So, if you are comfortable and think that you will be holding the right position when that happens, you can make some good money. Unfortunately you are now simply the gambling customer rather than trying to be the house  


  150. I should add that I am saying $4000-$6000 if you are only playing two contracts. If it is 5 you are down $10000-$15000 which if it happens a few times, is starting to be some real money and not just pocket change. There is an old saying, the way to make a small fortune is to start with a large one!


  151. From Bloomberg, Aug 14, 2014, 5:38:12 AM

    European stocks retreated after data
    showed the euro area’s recovery unexpectedly stalled in the
    second quarter as its three biggest economies failed to grow.
    U.S. futures were little changed, while Asian shares rose.

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

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


  152. From Bloomberg, Aug 14, 2014, 12:01:00 AM

    Cisco Systems Inc. (CSCO) Chief Executive
    Officer John Chambers is struggling to revamp the world’s
    largest networking-equipment maker, eliminating 6,000 jobs in a
    new round of cuts and forecasting little to no sales growth.

    To read the entire article, go to http://bloom.bg/1oP9Ylz

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


  153. From Bloomberg, Aug 14, 2014, 2:24:32 AM


    Aug. 14 (Bloomberg) — Joshua Miller, senior economist at the Royal Institution of Chartered Surveyors, talks about U.K. house purchases, the Mortgage Market Review and possible impact of a strong pound on foreign buyers.
    He speaks with Manus Cranny and Mark Barton on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Bank of England policy maker David
    Miles
    said London’s property market is showing signs of cooling
    as an index of values in the capital published today slipped to
    a three-year low.

    To read the entire article, go to http://bloom.bg/1lVSO0B

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


  154. From Bloomberg, Aug 14, 2014, 1:57:13 AM

    Chancellor Angela Merkel’s
    government may start reducing the amount of German sovereign
    bonds outstanding from as early as next year as it seeks to
    deliver on a 2013 election promise to stop adding new debt.

    To read the entire article, go to http://bloom.bg/1p6IQxH

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


  155. From Bloomberg, Aug 14, 2014, 12:00:01 AM

    “Stocks look cheap relative to corporate profits” by at least one barometer of U.S. shares, according to James W. Paulsen, Wells Capital Management Inc.’s chief investment strategist.

    To read the entire article, go to http://bloom.bg/1oP9YSl

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


  156. Watch this video at http://bloom.bg/1sEc4XT

    Global Tensions Are Up…So Why Aren’t Oil Prices?

    Aug. 14 (Bloomberg) — Bloomberg’s Haslinda Amin reports on the global factors impacting oil prices. She speaks with John Dawson on “First Up.” (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


  157. Watch this video at http://bloom.bg/1AeOIck

    Will AT&T’s New iPhone Sales Promotion Work?

    Aug. 13 (Bloomberg) — On today’s “The Roundup,” Bloomberg’s Trish Regan, Keri Geiger, Alex Sherman and Eric Chemi wrap up the day’s top market stories on Bloomberg Television’s “Street Smart.” (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


  158. Watch this video at http://bloom.bg/1lR7XAo

    Ukraine Playing `Dangerous Game’ with Russian Gas

    Aug. 12: Ukraine is playing a “dangerous game” with proposals to ban the transit of Russian natural gas through the country, according to Warwick Business School Professor Michael Bradshaw.

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


  159. From Bloomberg, Aug 14, 2014, 12:01:00 AM

    Victor Dahdaleh arrives at Southwark Crown Court, London, after being charged in connection with an alleged £700 million bribery scandal. Photographer: Anthony Devlin/PA

    In January, a unit of Alcoa Inc. (AA),
    the biggest U.S. aluminum producer, pleaded guilty to foreign
    bribery charges brought by the U.S. Justice Department. Alcoa
    also settled claims by the Securities and Exchange Commission
    and agreed to pay a $384 million fine — the fifth-largest such
    penalty ever.

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

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


  160. From Bloomberg, Aug 14, 2014, 12:54:34 AM


    People visit the stand of Alibaba during the 12th China Digital Entertainment Expo, also known as China Joy 2014, in Shanghai, China. Photograph: Imaginechina via AP Images

    Simon Xie, an Alibaba Group Holding Ltd. (BABA) co-founder and second-biggest shareholder of its finance affiliate that owns Alipay, may become a billionaire as the estimate for the value of the electronic-payment company rose.

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

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


  161. From Bloomberg, Aug 14, 2014, 4:22:42 AM

    Bars of 100-ounce silver are stacked inside The Safe House, a vault operated by Silver Bullion Pte, in Singapore. Photographer Nicky Loh/Bloomberg

    The silver-pricing method begun during the reign of Queen Victoria ends today in London as the $5 trillion market shifts to a more transparent process and regulators expand scrutiny of how commodity benchmarks are set.

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

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


  162. From Bloomberg, Aug 14, 2014, 4:51:00 AM

    Investors watch the stock trading board in Shanghai. Photographer: Qilai Shen/Bloomberg

    Zhang Xiuli says she knows nothing about the nine Chinese companies that held initial public offerings last month.

    To read the entire article, go to http://bloom.bg/1lVP13f

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


  163. From Bloomberg, Aug 14, 2014, 12:00:00 AM

    Banks including JPMorgan Chase &
    Co. (JPM)
    , Citigroup Inc. (C) and Morgan Stanley (MS) have been notified
    regulators are preparing enforcement actions on currency
    rigging, people familiar with the investigation said.

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

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


  164. From Bloomberg, Aug 13, 2014, 10:58:24 PM

    Night view of the Shanghai Tower under construction, tallest left, the Shanghai World Financial Center (SWFC), tallest center, the Jinmao Tower, tallest right, and other skyscrapers and high-rise buildings in the Lujiazui Financial District in Pudong, Shanghai, China, 30. Imaginechina via AP Images

    Tensions in China’s foreign business community escalated to new highs after European companies protested that local authorities involved in an antitrust crackdown are abusing their power through intimidation tactics.

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

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


  165. From Bloomberg, Aug 14, 2014, 5:00:00 AM


    Aug. 14 (Bloomberg) — Antonin Jullier, global head of equity trading strategy at Citigroup Inc., talks about slower growth in Europe’s biggest economies and German stocks.
    He speaks with Jonathan Ferro on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    The euro area’s recovery unexpectedly stalled in the second quarter as its three biggest economies failed to grow, underlining the vulnerability of the region to weak inflation and the deepening crisis in Ukraine.

    To read the entire article, go to http://bloom.bg/1sFiPJ5

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


  166. From Bloomberg, Aug 14, 2014, 5:15:26 AM


    Aug. 14 (Bloomberg) — Antonin Jullier, global head of equity trading strategy at Citigroup Inc., talks about slower growth in Europe’s biggest economies and German stocks.
    He speaks with Jonathan Ferro on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    Germany’s bonds rose, with 10-year
    yields (GDBR10)
    falling below 1 percent for the first time, as Europe’s
    largest economy shrank more in the second quarter than analysts
    predicted, boosting bets on more central-bank stimulus.

    To read the entire article, go to http://bloom.bg/1sF680I

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


  167. From Bloomberg, Aug 14, 2014, 4:23:19 AM


    Aug. 14 (Bloomberg) — Yannick Naud, chief investment officer at Sturgeon Capital Ltd., discusses the outlook for euro-area economies, European bonds and investments in Russian assets.
    He speaks with Manus Cranny and Mark Barton on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    The French government abandoned its 2014 deficit targets after the economy unexpectedly failed to grow for a second straight quarter, risking a clash with European partners striving to meet their own fiscal goals.

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

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


  168. From Bloomberg, Aug 14, 2014, 5:36:32 AM


    Aug. 14 (Bloomberg) — Beat Siegenthaler, a currency strategist at UBS AG, talks about the outlook for the pound, euro and dollar.
    He speaks with Mark Barton and Manus Cranny on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Government bonds rose, sending
    Germany’s 10-year yield below 1 percent for the first time, and
    European stocks declined as growth in the region missed
    economist estimates. Oil led commodities to a six-month low and
    the pound weakened.

    To read the entire article, go to http://bloom.bg/1p7GI8W

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


  169. From Bloomberg, Aug 13, 2014, 11:00:00 PM

    Firefighters work at the crash site of a small plane that was carrying Brazilian presidential candidate Eduardo Campos and several campaign officials, in Santos, Brazil, on Aug. 13, 2014. Photographer: Walter Mello/A Tribuna/AP

    The death of Brazilian presidential
    candidate Eduardo Campos yesterday resets a contentious campaign
    less than two months before the election.

    To read the entire article, go to http://bloom.bg/1p8nIY9

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


  170. From Bloomberg, Aug 14, 2014, 1:06:09 AM

    Have police officers turned up at
    your head office wanting to scan your hard drives? Don’t worry -
    - there’s an app for that.

    To read the entire article, go to http://bloom.bg/1q9u329

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


  171. From Bloomberg, Aug 14, 2014, 5:44:29 AM


    Aug. 14 (Bloomberg) — Beat Siegenthaler, a currency strategist at UBS AG, talks about the outlook for the pound, euro and dollar.
    He speaks with Mark Barton and Manus Cranny on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Foreign-exchange forecasters who’ve
    spent all year chasing the rally in the pound are now finding
    themselves too far in front after Bank of England Governor Mark Carney said officials won’t rush to raise interest rates.

    To read the entire article, go to http://bloom.bg/1sF8xZe

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  172. From Bloomberg, Aug 14, 2014, 4:02:05 AM

    Doctors Without Borders (MSF) at the isolation ward of the Donka Hospital in Conakry, Guinea. Photographer: Cellou Binani/AFP via Getty Images

    A vaccine that could help protect medical workers as they fight Ebola in West Africa, even just after contamination, may take at least a month to be available as global officials weigh its safety.

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

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  173. From Bloomberg, Aug 14, 2014, 12:00:01 AM


    The move is likely to extend the reach of sanctions against Russia, as the Obama administration presses President Vladimir Putin to stop supporting pro-Russian separatists in Ukraine. Photographer: Andrey Rudakov/Bloomberg

    The U.S. Treasury broadened the scope of sanctions programs by revising a rule on the ownership of entities by targeted individuals that may extend the measures to at least one Russian company.

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

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  174. From Bloomberg, Aug 14, 2014, 4:50:51 AM


    Aug. 4 (Bloomberg) — Portugal acted promptly to rescue Banco Espirito Santo SA, even as the potential remains for further surprises in the European banking industry, according to David Costa, dean of Robert Kennedy College in Zurich.
    He speaks from Zurich with Mark Barton on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    The Portuguese government’s mix of
    tax increases and spending cuts has put the country on a
    sustainable economic path, according to a Bloomberg News survey.

    To read the entire article, go to http://bloom.bg/1lVU5Vv

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  175. Watch this video at http://bloom.bg/1sF2gwN

    Germany’s GDP Contracts by 0.2%

    Aug. 14 (Bloomberg) –- Bloomberg’s Manus Cranny, Mark Barton and Hans Nichols report on the latest GDP figures out of Germany on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

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  176. From Bloomberg, Aug 14, 2014, 1:35:30 AM

    Aug. 14 (Bloomberg) — Kwon Young Sun, a Hong Kong-based economist at Nomura Holdings Inc., talks about South Korea’s economy, central bank policy and currency.
    South Korea’s central bank cut its interest rate for the first time in more than a year, risking inflaming record household debt as it backs government efforts to spur Asia’s fourth-biggest economy. Kwon speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    South Korea’s central bank cut its
    interest rate for the first time in more than a year, risking
    inflaming record household debt as it backs government efforts
    to spur Asia’s fourth-biggest economy.

    To read the entire article, go to http://bloom.bg/1lW7oVN

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  177. From Bloomberg, Aug 13, 2014, 7:01:00 PM


    Aug. 14 (Bloomberg) — Beat Siegenthaler, a currency strategist at UBS AG, talks about the outlook for the pound, euro and dollar.
    He speaks with Mark Barton and Manus Cranny on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Long-maturity U.K. government bonds
    are on course for their best quarter since 2012 as investors bet
    appetite for the securities will be preserved amid a shakeup of
    the pensions industry.

    To read the entire article, go to http://bloom.bg/1oPiz7G

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  178. From Bloomberg, Aug 14, 2014, 4:11:32 AM


    Aug. 14 (Bloomberg) — Yannick Naud, chief investment officer at Sturgeon Capital Ltd., discusses the outlook for euro-area economies, European bonds and investments in Russian assets.
    He speaks with Manus Cranny and Mark Barton on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    The euro area’s recovery halted in its three biggest economies in the second quarter, underlining the vulnerability of the region to weak inflation and the deepening crisis in Ukraine.

    To read the entire article, go to http://bloom.bg/1oPs6f4

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  179. From Bloomberg, Aug 14, 2014, 4:51:43 AM

    Luxury residential buildings stand illuminated at night on Phoenix Island in the Sanya Bay district of Sanya, Hainan Province, China. Photographer: Brent Lewin/Bloomberg

    China’s plunge in credit expansion last month and unexpected slowdown in investment spending flashed warnings on growth that investors and economists bet will spur policy makers to expand stimulus.

    To read the entire article, go to http://bloom.bg/1prY696

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  180. From Bloomberg, Aug 14, 2014, 5:23:39 AM


    A private residential building, center, stands among public housing in the Bishan area of Singapore. Photographer: Bryan van der Beek/Bloomberg

    James Hee, a property agent who lives with his family of four in a government-built flat he owns in Singapore, was eyeing a condo for about S$1.5 million ($1.2 million) earlier this year. Then Hee discovered that he wouldn’t qualify for a mortgage after the government restricted lending.

    To read the entire article, go to http://bloom.bg/1p7mCM2

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  181. From Bloomberg, Aug 13, 2014, 4:23:21 PM

    Mammas, don’t let your babies grow up to be trust fund kids.

    Having grown up in New York City and attended an expensive college, I invariably came into contact with quite a few people who had sizable inheritances or trust funds coming to them. Over the years, I’ve grown quite sincerely glad that I wasn’t one of them. I can’t claim to have any scientific data, of course, but in my experience, too many of those people were always about to do something but never got to the point of actually having done it. They got jobs but left them when the job proved to be tiresome, or when they had a major setback such as a terrible performance review. They didn’t need to make a career in order to put food on the table, and that kept them from doing the often painful and unpleasant work of getting really good at their jobs. And ultimately, they weren’t happy about that. Their money protected them from the very real miseries of being broke. But it also protected them from the sweet smell of success.

    To read the entire article, go to http://bv.ms/1p7bPl5

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  182. From Bloomberg, Aug 13, 2014, 3:13:22 PM


    No hedge funds here.                                                                         

    In an earlier article for Bloomberg View, I described a danger facing investors: the put-option illusion. This is when investors, who tend to extrapolate too much from recent trends, are fooled into thinking that a string of good returns means an investment has very little risk. Often the risk is just lurking way out in the tail of the distribution, ready to jump out and crush your wealth.

    To read the entire article, go to http://bv.ms/1r9K52s

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  183. From Bloomberg, Aug 13, 2014, 1:05:09 PM

    Worth less.                                                                                        

    N/A

    To read the entire article, go to http://www.bloombergview.com/articles/2014-08-13/stagflation-stalks-abenomics

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  184. From Bloomberg, Aug 13, 2014, 12:43:54 PM

    Is brown in fashion?

    I checked the National Rifle Association website again today, eager to read the organization’s take on the police shooting last weekend of Michael Brown in Ferguson, Missouri. The web site is chock full of content. It beckons members to participate in the “non-traditional action packed, ever popular 3 Gun competition, utilizing modern sporting rifles, shotguns and pistols.”

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

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  185. From Bloomberg, Aug 13, 2014, 11:42:51 AM

    Just be smart about accessing your bitcoins, OK?

    It’s been a few months since I last wrote about bitcoins, but I couldn’t resist a brief note after this week’s warning letter from the Consumer Financial Protection Bureau about the risks of virtual currency. In announcing the advisory, CFPB Director Richard Cordray cautioned that bitcoin investors “are stepping into the Wild West.”

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

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  186. From Bloomberg, Aug 13, 2014, 10:21:31 AM

    Ben-Gurion Airport, Israel’s only major international hub, lies just inland from the Mediterranean Sea. When heading to Europe or North America, therefore, the standard takeoff route is a simple westward one; as the plane lifts off, you can look out the window, see Tel Aviv, then the beach, and then the sea as you leave Israel behind.

    To read the entire article, go to http://bv.ms/1us5dBy

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  187. Good morning! 

    News was so bad it's good on EU GDP – once again we're up on stimulus talk.  That chart I posted above is all about stimulus too.  Sure we have record corporate profits but they are driven by a total lack of investing in the future with money instead diverted to buybacks and layoffs and M&A (another form of buybacks with more layoffs) and, of course, it's all driven by stimulus.  

    It's like giving a coma patient constant blood transfusions and oxygen and 4 kinds of drugs in the IV and saying "look how great he's doing – let's invest in his future!"  Once the stimulus stops, the Future may not look so bright anymore.  This is why momma birds eventually push baby birds out of the nest – it don't mean a thing until they can fly on their own.  

    Anyway, futures were down 0.2%, now up 0.2% as the bad EU GDP numbers came out.  We have /TF 1,140 again to short if you are feeling brave (tight stops over the line I seem to have to always say!) and that will be confirmed by /YM under 16,650, /ES under 1,950 and /NQ under 3,950 and, as always, we can just short the laggard. 

    Oil $98.52 and should hold out hope into Nat Gas Inventories at 10:30 and the Dollar is 81.61 but in danger of rising as easy Euros mean a stronger Dollar.

    /NKD just failed to get back over 15,300, another nice short below the line.  


  188. Biggest story of the day (which is being ignored):

    • The euro-zone economy stalled last quarter after 12 months of weak growth, underscoring concerns that the region is mired in a deep rut of high joblessness and weak consumer prices. 4 min ago

    • gdp

    • Eurozone final inflation, July (2)

    14 Reasons Why The U.S. Economy’s Bubble Of False Prosperity May Be About To Burst

     

    Forget the Fed, tepid revenue growth is the threat

     

    Germany turning Japanese with sub 1% 10-year yield.

    Not even escalating geopolitical conflicts can grind this rally in high-risk debt to a true halt:

     

    Eating too little salt increases the risk of a heart attack or stroke, new study finds

     

    California lawmakers reach $7.7 billion deal to sell bonds for water

     


  189. Trust fund babies – "Their money protected them from the very real miseries of being broke. But it also protected them from the sweet smell of success."

     

    So true in my experience. I wonder how psychologically balanced Rupert Murdoch's kids are.


  190. I like the discussion on Futures.  Keep in mind it's a game of skill and if, let's say, I was a rock climber and I show you how I climb up a cliff with no equipment – EVEN IF I SHOW IT TO YOU PERFECTLY – you would KNOW you couldn't just go do it right after me without practice, right?

    Well, keep that in mind when discussing Futures (or Options, or ANY) Trading – some people are long-time experts and some people are beginners and many are in between.  Just because you see someone doing well and even if they tell you EXACTLY what they are doing – it does not mean you will be able to replicate their performance without a lot of practice (and trial and error) on your part.  

    It takes a lot of time and practice to learn what a good or bad signal is.  It takes a lot of time and practice to learn what your own risk tolerance is.  It takes a lot of time and practice to learn when a trend is weakening or just hitting a small resistance.   There's a lot of math involved in keeping track of your basis as well as in setting constant new goals and then a whole other set of math involved in decided whether or not those goals are realistic given your current position.  

    Like hitting a curveball – all of these things become natural to you with practice but, while you are gaining experience – you will strike out a lot!!! 

    If you are looking to avoid a major fall, then paper trading is a great idea, as is starting off SMALL and, as RDN said, limit yourself until you have a proven history of positive trades and THEN up your bets (if comfortable) a little at a time.  I've been trading 40 years and I still play one contract most of the time BUT – let's talk about this morning (now that I've hopefully put it in context). 

    Yesterday I traded one RUT contract because it was acting strange and, though I ONLY made bearish bets all day and though I got burned a couple of times, I ended the day up $300.  This morning, however, just after I put up the short lines above, the RUT was at 1,140.2 and I shorted 4 contracts – because I feel stronger about today than yesterday and my plan is to get out of 2 of them at 1,139.07, which will then let me put a stop at 1,140.05 to get out even on the last two and then I can relax and see how far below 1,140 we can go.  

    At the moment, the Dow and S&P are under their lines but the Nas is 0.5 over so I don't consider this a great signal but I feel good about my premise.  Good enough that I'm willing to risk 4 x $500 if the RUT moves up to 1,145 before I get a chance to stop out.  I don't intend to DD, I intend to stop out at 1,141.1 with a $400 loss and then re-enter on the next cross below (looking to get my $400 back) or to go short again at 1,150 – if it gets that high.  

    There's no major economic report coming up, other than unemployment which USUALLY is not a big market mover, so I don't THINK I will get blown out but, if I do, it could be a $4,000 loss on a 10-point Russell move.  Losing $4,000 is no joke but, realistically, for me, it means getting 2 regular rooms when we're in Maimi next month vs the suite – it's not life-changing money.  

    Winning $4,000 means a free suite but I'm not trying to win $4,000, not all at once, I'll be THRILLED to make $500 and, frankly, if you can't be THRILLED to make $500 in the Futures – you shouldn't be playing the Futures – consider that lesson number one.  

    Obviously, it's not likely that 4 contracts will pop or drop 10 points before I have time to react (and, even as I'm writing this we're crossing 1,140.7 and I'm down $200 and $200 more from pulling the plug).  $800 I can make up easily on my next one or two attempts but $4,000 would probably kill my whole week.  Again, I much prefer to trade just one contract – especially when I'm also working, but I feel strongly that this news flow is simply too negative to ignore.

    Speaking of work – time to write my post.


  191. Back to 1,140.2 and I'm still in my short – was getting worried there.  It's more about being right or wrong for me than it is about the money – I hate to lose because it means I guessed wrong.   Because I usually guess right, I like to bet money on my guesses.  

    I don't bet on horses, because I'm not good at guessing – I like to go to the track but my favorite thing to do at the track is to buy exactas for every possible combination and give them to my kids and their friends.  So one kid gets 1 and any and another gets 2 and any – it costs about $100 and usually they win less than $50 but man do we have a good time because someone always wins!  

    Anyway, so I don't bet on things I don't think I can win – that's the key.  If I felt like it was guessing, I wouldn't play! 


  192. So, now at 1,141.10 I haven't gotten out yet because it's not confirmed by the Dow or the S&P, nor do I hear any news that justifies it.  Oil remains below $97.50 so if that crosses or Dow over 16,650 or /ES over 1,950 (I don't think it's in the cards today) then I'm out but, at the moment, down $320.  


  193. Finally!  Nice drop, testing 1,140 now but looks like it will fail.  If not, now I'm going to get out over 1,140.7 because holding 1,140 here would mean my premise that it's weak and will break is getting shaky.  


  194. Notice how I'm constantly shifting my expectations (and mental stops) as new information comes in.  That's new news, new levels that I observe providing support and resistance, etc.  You can't be dogmatic trading the Futures – you have to constantly adapt to the changing environment.  


  195. Spiked up to 1,141 again but without other confirming signals, so I'm still in.  If I didn't already have 4, I'd be doubling down here.  


  196. Risking unemployment report – not likely to beat last week and a strong report should pump the Dollar anyway and give me at least enough downward pressure to get out. 


  197. Claims up 21,000 to 311,000 – not too weak, not too strong.  

    Import prices down 0.2%, export prices flat.  

    I'm inclined to wait and see.  Gold spiking over $1,315 on the news, oil still under $97.50 and still a signal to kill my trade. 


  198. Goallllllllll at 1,139!  Now I can take 2 off (if we cross back over 1,139 – we're falling fast, and lock in those gains and stop the rest at 1,139.50 – now I'll just keep lowering my stops and, at the moment, I'm up over $500 – and the Egg McMuffins are paid for!  


  199. Phil; Can you give me the prior high/low you used to get the 1140 on TF using the 5% rule.   Thx


  200. Now my /ES stop is 1,945, 16,625 on /YM and 3,947.50 on /NQ.


  201. 1,140 is the -5% line on the Big Chart – VERY significant line!  


  202. 1,138.5 is now the stop on the last 2 – a trailing 0.5.


  203. Oh, I see that now.  How about YM at 16650?  I am looking at the drop from 17000 to 16200.  20% would be moves of 160 so not sure how we get 16650.  Thx


  204. Actually, 1,137.5 is going to be bouncy as it's lining up with 16,600, 1,942.50 and 3.945 so time to cash the /TF and then, if 3 of 4 cross below – SHORT THE LAGGARD!