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Which Way Wednesday – Fed Edition

Wow, what a recovery!  

And wow, what complete and utter BS it is.  They NYSE is still below 11,000 (our Must Hold line) and the Russell is still below it's 50 dma and we up on less than 10% of the volume (total) that sold off for the last two weeks.  But, who cares as long as it paints a pretty picture?  

We can thank the Wall Street Journal's Fed Whisperer, John Hilsenrath with yesterday's rally as he wrote not one but TWO  articles that whipped traders into a frenzy on his "insider view" that the Fed "may keep the words "considerable time" in its policy statement."  Oh, be still my heart!  More free money?  Really?  Will wonders never cease?  

Needless to say we took the opportunity to re-short the Dow Futures (/YM) at 17,050 and the S&P Futures (/ES) at 1,993 and the Nasdaq Futures (/NQ) at 4,060 and the Nikkei Futures (/NKD) at 15,950 – all of which we discussed in yesterday's Live Trading Webinar that was, sadly, a Members only affair (but you can join us here).  

We also got a chance to short oil at $95 again (a level I published in yesterday's post) and we're thrilled with that and already this morning, it's back at $94.50 for $500 per contract gains.  For non-futures players we grabbed the SCO Sept $30s at .25 as a fun play that inventories at 10:30 won't support $95 oil in much the way Fed policies at 2pm won't support these market levels.  In fact, here's CNBC's Art Cashin telling you yesterday at noon what I told you pre-market, yesterday morning – BRILLIANT!  

 

Art's actually one of the very few Wall Street analysts I respect (and not just because he repeats what I say), I've followed him since I was a kid – he's a fantastic guy and a lot of what I share with you – I learned from him.  As you can see on the Big Chart, the Russell is the laggard and, if the indexes break higher – it's the index we'll go long on but our short bets (TZA) have already paid off very well.  We like them long over 1,145 if the above levels are all over because there is very little upside resistance on TF, all the way back to 1,200.  On the other hand, a break below 1,140 (-5% on the Big Chart) that sticks is likely to be tragic

Today we'll be watching our bounce lines (per the 5% Rule™), which are in play all week and it's been a mixed bag so far with:

  • Dow 16,980 (weak) and 17,010 (strong) 
  • S&P 1,985 (weak) and 1,990 (strong) 
  • Nasdaq 4,560 (weak) and 4,570 (strong) 
  • NYSE 10,950 (weak) and 11,000 (strong) 
  • Russell 1,160 (weak) and 1,170 (strong)

In order for us to get bullish again, we want to see NO weak bounces and 4 of 5 of the strong bounce lines taken back.  The Nasdaq is at 4,553 and the NYSE is at 10,980 so, if they can cross their next goals, we'll be happy to go long on the Russell at 1,145 (/TF) and we can also play that with TNA (ultra-long Russell), where the weekly $71.50s have very little premium at $1.80 - considering that TNA ($72.42) popped 0.60 yesterday with the Russell up just 0.4%.  A 1% move up in the Russell should be a 50% gain on those calls!  

Keep in mind – we are SHORT on the market, these long plays are just a hedge (IF we go over our lines, which we DON'T expect) - in case we're wrong and the Fed sprinkles more fairy dust to get us back over S&P 2,000.  As with our downside hedges – we look for plays that give us the best leverage but we use very tight stops on the positions we don't agree with and, once they make us some money – we're very anxious to take our profits and run.  

In our latest flashback to 2008, RAX announced yesterday that they are not for sale and promptly dropped 20% after hours, losing over $1.4Bn in market cap in less than 5 minutes.  That's how much air is under a lot of these high-flying stocks that are up based on nothing but M&A rumors and stock buybacks and giddy analyst upgrades while the underlying business does NOTHING to justify the price increases.  

RAX had a p/e of 65 yesterday.  With a $6Bn+ market cap they were dropping less than $100M to the bottom line, LOWER than the $105M they earned in 2012.  Now we're likely to be testing that blue support line on the chart but that's still 50 times earnings at $32 – no wonder no one is buying them!  My warning to one of our Members on 7/2 was particularly well-timed:

RAX/Deano – The trade is fine if you are so inclined to play the stock.  I'm not.  I don't like them long-term as they essentially sell a commodity (cloud storage) which only gets cheaper over time.  Not only that but they are competing with AMZN, who get to go into businesses for negative margins and still get rewarded for trying.  I don't see how going private would improve things or who would want to be the ultimate bag-holder for these guys

BTU ($14), on the other hand, we called a bottom on yesterday, as well as GTAT ($12), TEX ($33) and CLF ($14).  For our logic on these trades as well as some excellent ideas on how to play them – come join us in our Live Member Chat room! 

153749 600 NY State and Scotland cartoons

 


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  1. From Bloomberg, Sep 17, 2014, 6:06:58 AM

    Sept. 17 (Bloomberg) — Bloomberg’s Anna Edwards examines the latest poll results on tomorrow’s Scottish independence referendum. She speaks on “Bloomberg Surveillance.”

    A vote in favor of Scottish independence tomorrow threatens to weigh down a booming housing market should thousands of homeowners become debtors of foreign lenders.

    To read the entire article, go to http://bloom.bg/1tZPny2

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


  2. From Bloomberg, Sep 17, 2014, 12:00:01 AM


    Sept. 17 (Bloomberg) — David Stubbs, a global market strategist at JPMorgan Asset Management, talks about the Federal Reserve’s interest-rate path, the outlook for U.S. equities and the Scottish referendum.
    He speaks with Mark Barton and Caroline Hyde on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Bill Gross is relying on derivatives rather than Janet Yellen to raise his returns on government bonds.

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

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


  3. From Bloomberg, Sep 17, 2014, 12:00:06 AM


    Citigroup, led by Chief Executive Officer Michael Corbat, 54, expanded the business from a low base to meet the needs of customers, said Danielle Romero-Apsilos, a company spokeswoman. Photographer: Angel Navarrete/Bloomberg

    Citigroup Inc. (C) is diving deeper into derivatives.

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

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


  4. From Bloomberg, Sep 17, 2014, 6:23:31 AM

    Annual inflation was 0.4 percent, unchanged from July, the European Union’s statistics office in Luxembourg said today. Photographer: Andrew Caballero-Reynolds/Bloomberg

    The euro-area inflation rate was
    higher than initially estimated in August, while remaining at
    the weakest level in almost five years.

    To read the entire article, go to http://bloom.bg/1uG46Nw

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


  5. From Bloomberg, Sep 17, 2014, 5:48:24 AM

    It’s back. The rout that gripped
    emerging-market currencies last year is again threatening to
    send exchange rates to their weakest levels since 2009.

    To read the entire article, go to http://bloom.bg/1u6IcAw

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


  6. From Bloomberg, Sep 17, 2014, 5:22:05 AM

    People pass in front of the “Welcome to Las Vegas” sign in Las Vegas, Nevada, U.S. On the Las Vegas Strip, gambling revenue rose 22.5 percent to $532 million in June, according to Bloomberg Intelligence. Photographer: Sam Hodgson/Bloomberg

    China’s high-spending gamblers are looking to bet outside Macau amid a government assault on corruption and extravagance, and that’s boosting casinos from the Philippines to the Las Vegas Strip.

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

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


  7. From Bloomberg, Sep 16, 2014, 5:00:01 PM


    An employee works on the assembly of a truck cabin on the production line at the OAO KamAZ plant in Naberezhnye Chelny, Russia. Photographer: Andrey Rudakov/Bloomberg

    The aging workforce is packing a double punch for the Russian economy.

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

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


  8. From Bloomberg, Sep 17, 2014, 12:00:02 AM

    Janet Yellen, chair of the U.S. Federal Reserve, speaks during a conversation with Christine Lagarde, managing director of International Monetary Fund (IMF), not pictured, at the IMF in Washington, D.C., U.S., on Wednesday, July 2, 2014. Photographer: Andrew Harrer/Bloomberg

    Here’s what to look for when the Federal Open Market Committee releases its policy statement and new economic projections at 2 p.m. today in Washington and Federal Reserve Chair Janet Yellen holds a press conference at 2:30 p.m.

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

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


  9. From Bloomberg, Sep 17, 2014, 12:00:01 AM

    As investors try to decode the
    Federal Reserve’s next step, options traders are betting that
    regardless of what happens, it’ll be a rocky ride for stocks.

    To read the entire article, go to http://bloom.bg/1uFu8R0

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


  10. From Bloomberg, Sep 17, 2014, 6:18:12 AM


    Former Allied Irish Banks Plc foreign currency trader John Rusnak, seen here in 2003, pleaded guilty in 2002 to defrauding AIB’s Allfirst Financial Inc. unit and was sentenced to seven-and-a-half years in prison. Photographer: Chris Kleponis/ Bloomberg

    Financial-services fraud will
    continue as long as bonuses provide incentives to ignore limits,
    according to convicted currency trader John Rusnak, who lost
    $691 million at a U.S. unit of Allied Irish Banks Plc. (ALBK)

    To read the entire article, go to http://bloom.bg/1yg7a6N

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


  11. From Bloomberg, Sep 17, 2014, 12:00:01 AM


    Sept. 17 (Bloomberg) — Manish Singh, head of investments at Crossbridge Capital, says he’s convinced Alibaba Group Holding Ltd., which sets a final price for its initial public offering tomorrow, is a “buy.”
    He speaks with Jonathan Ferro on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    U.S. fund managers studying an investment in Alibaba Group Holding Ltd. are worried about everything from corporate governance to bull market fatigue. They’re buying anyway, afraid of missing a bargain.

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

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


  12. From Bloomberg, Sep 17, 2014, 5:55:27 AM


    The People’s Bank Of China headquarters in the financial district of Beijing. Photographer: Brent Lewin/Bloomberg

    Just a normal banking-system operation to cope with a brief liquidity shortage? Or a secretive move to shore up growth as China faces up to the danger of a hard landing for its economy?

    To read the entire article, go to http://bloom.bg/1uFFW5F

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


  13. Oil Lines

    R3 – 98.53
    R2 – 96.86
    R1 – 95.80
    PP – 94.13
    S1 – 93.07
    S2 – 91.40
    S3 – 90.34


  14. From Bloomberg, Sep 16, 2014, 7:00:00 PM

    Scottish government estimates of
    the oil income an independent Scotland would receive are based
    on figures from an industry lobby whose projections in past
    years have proven optimistic.

    To read the entire article, go to http://bloom.bg/1s5DJ4M

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


  15. From Bloomberg, Sep 17, 2014, 12:34:05 AM

    Business leaders in Western Japan
    warned central bank chief Haruhiko Kuroda that the yen’s slide
    to a six-year low is boosting costs of imported raw materials
    and fuel and may spell trouble for the economy.

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

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


  16. From Bloomberg, Sep 16, 2014, 5:51:53 PM


    Japanese 10000 yen banknotes are stacked for a photograph at the Korea Exchange Bank headquarters in Seoul, South Korea. Photographer: SeongJoon Cho/Bloomberg

    Japanese pension funds favoring overseas investments are helping send the yen down toward its biggest monthly loss this year, Nomura Securities Co. says.

    To read the entire article, go to http://bloom.bg/1BKd9zc

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


  17. Some possible confirmation that there were some issues with sapphire from GTAT for the iPhones:

    http://gizmodo.com/why-apple-didnt-use-sapphire-screens-in-the-new-iphones-1635686236

    According to the author, the likely reason that Apple didn't go for sapphire wasn't the rumored supply issues — rather, sapphire doesn't really make sense for a phone screen. There are the obvious issues, like the added cost of sapphire over Gorilla Glass; but there's a myriad of less-evident reasons, like the battery life issues sapphire would incur. Most surprisingly, sapphire apparently isn't any better in a drop-test scenario — the added rigidity means the sapphire is more liable to crack than glass, which bends to absorb the impact.


  18. From Bloomberg, Sep 16, 2014, 2:41:54 PM

    I’ve been paying attention to so many other stories that I almost let the anniversary of the Lehman Brothers’ Chapter 11 bankruptcy filing (it was six years to-the-day yesterday) slip by unnoticed.

    To read the entire article, go to http://bv.ms/YPxHs8

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


  19. And the article from Time that is referred to in the post:

    http://time.com/3377972/why-apple-didnt-use-sapphire-iphone-screens/

    And some of the possible problems:

    The cost to produce a sheet of sapphire is estimated to be roughly 10 times that of strengthened glass. In fact, one source I talked to said that cost could be even higher. Our researched opinion early on was that if Apple did add a sapphire screen to the new iPhone, it would add at least $100 to the base cost. That could be a deal-breaker for mainstream iPhone customers.

    Sapphire requires 100 times more energy to produce than glass. The energy requirements alone make sapphire problematic as a viable material to use on a smartphone. None of the folks I talked to had any idea how they could solve this problem given the nature of the material itself.

    According to Bernstein Research — which conducted research on the benefits of glass versus sapphire as a cover material — glass transmits light much better than sapphire. Therefore, to get the same level of brightness using a sapphire screen requires more energy. 


  20. From Bloomberg, Sep 16, 2014, 4:43:23 PM


    These people? They’re all covered.

    Today’s Census Bureau report on health insurance in 2013 shows that on the eve of Obamacare, whether you had coverage was largely a question of how much money you made:

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

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


  21. Good Morning!


  22. Good morning!  

    Here's that Benzinga Interview from Monday I was talking about in the Webinar.  

    Sapphire/StJ – It's possible that AAPL only expected to get Sapphire for their watches all along – I simply can't believe that AAPL thought they'd be able to use it on their iPhones when it cost too much and didn't protect them properly – AAPL simply doesn't make engineering mistakes like that.  So, either these articles are BS or there was never going to be a screen business.  Either way, AAPL is buying $500M of SOMETHING from GTAT and that's 160% of last year's total sales in new business.  Even if they take 4 years to process it, that's still a 40% annual bump in revenues from here.

    • Japan -0.14%.
    • Hong Kong +1.00%.
    • China +0.49%.
    • India +0.52%.
    • London +0.34%.
    • Paris +0.61%.
    • Frankfurt +0.48%
    • August Consumer Price Index: -0.2% vs. +0.1% consensus, +0.1% prior.
    • Core CPI flat vs. +0.2% expected, +0.1% prior.
    • Awaiting FOMC members when they arrive for day two of their policy meeting will be today's news of a 0.2% decline in the CPI in August (vs. a forecast 0.1% gain), along with the core rate flatlining (vs. a forecast 0.2% gain). It's first time the core rate hasn't risen on a month-to-month basis in four years. So much for being behind the curve.
    • On a year-over-year basis, the CPI rose 1.7% vs. 1.9% estimated.
    • The 10-year Treasury yield slips to 2.56% from 2.59% ahead of the report.
    • TLT +0.5%, TBT -1% premarket
    • Q2 Current Account: -$98.5B vs. -$114.0B consensus, -$102.1B in Q2 (prior revised).
    • MBA Mortgage Applications:
    • Composite Index: +7.9% vs. -7.2% last week.
    • Purchase Index: +5.0% vs. -3% last week.
    • Refinance Index: 10% vs. -11% last week.
    • Fixed 30-year mortgage rate rises to 4.36% from 4.27.
    • According to new figures from the Census Bureau, inflation-adjusted income for the median U.S. household rose by just 0.3% in 2013, no higher than a quarter of a century ago.
    • This translates into the median household edging up just $180 last year to $51,939, highlighting another year of stagnant incomes.
    • The poverty rate fell from 15% to 14.5%, the first decrease since 2006, but it is still two percentage points higher than it was before the recession.
    • The unemployment rate fell to 6.2% from 6.4% in the three months ending in July, the lowest level in six years. A separate gauge, the claimant measure fell to 2.9%, also the lowest since 2008. Wages remain sluggish though, with basic pay rising an annual 0.7% during the quarter, matching a record low.
    • The one thing holding back rate hikes in the U.K. is that slow wage number, according to Bank of England chief Mark Carney.
    • In separate news, the BOE minutes show MPC members again split 7-2 on keeping the benchmark rate at 0.5% (2 wanted a hike).
    • The pound is higher by 0.3% vs. the dollar and buying $1.6320.
    • Isn't this one of the ways we got into the housing mess? Citigroup (NYSE:C) signs on with Bank of America (NYSE:BAC) to fund 15-year mortgages at below-market rates for borrowers with low incomes, spotty credit histories, or both.
    • The loans are being originated by the Neighborhood Assistance Corporation of America (NACA), a group – that has the ear of HUD – known for pushing banks to show they're fulfilling the terms required of them by the Community Reinvestment Act of 1977 (no redlining).
    • The moves also follow the banks' massive mortgage settlements, part of which were agreements to provide assistance to troubled mortgagees, though both say this new program is not related.
    • For its part, NACA says the foreclosure-loss rate on more than 18K purchase loans it has originated since 2006 is about 0%, with one of the reasons being NACA making up to three months of mortgage payments when borrowers run into trouble.
    • Lennar (NYSE:LEN): FQ3 EPS of $0.78 beats by $0.11.
    • Revenue of $2.01B (+25.6% Y/Y) beats by $50M.
    • Press Release
    • Q3 net earnings of $177.8M or $0.78 per share vs. net earnings of $120.7M and $0.54 one year ago.
    • Deliveries of 5,457 homes up 9% Y/Y. New orders of 5,889 up 23%; new order dollar value of $1.9B up 28%.
    • Backlog of 7,290 homes up 22%; backlog dollar value of $2.5B up 29%.
    • Gross margin on home sales of 25.2% up 30 basis points.
    • Operating margin on home sales of 14.8% up 10 basis points.
    • Lennar Multifamily contributed operating earnings of $8.5M compared to a start-up operating loss of $5.6M. The unit completed its first two sales of apartment properties in Q3, with both producing greater than the targeted 25% ROIC.
    • CEO Stuart Miller: "Our core homebuilding business is hitting on all cylinders as we have properly considered and understood the uniqueness of this recovery."
    • Conference call at 11 ET
    • Previously: Lennar beats by $0.11, beats on revenue
    • LEN +4.3% premarket
    • Automobile registrations increased 1.8% to 701K vehicles in August, according to the European Automobile Manufacturers Association.
    • The rate of monthly growth is the slowest of the year.
    • Sales declined slightly during the month in Germany, France, and Italy.
    • Sales growth by automaker: Volkswagen (OTCQX:VLKAY) +9.4%, Peugeot (OTCPK:PEUGY) +1.9%, Fiat (OTCPK:FIATY) -2.8%, General Motors (NYSE:GM) -14.7%, Renault (OTC:RNSDF) -3.1%, Daimler (OTCPK:DDAIF) -5.3%, Toyota (NYSE:TM) -6.2%, Ford (NYSE:F) +17.4%, BMW (OTCPK:BAMXY) -1.4%, Fiat (OTCPK:FIATY) -2.8%, Nissan (OTCPK:NSANY) +1.6%, Hyundai (OTC:HYMLF) +2.0%.
    • FedEx (NYSE:FDX): FQ1 EPS of $2.10 beats by $0.14.
    • Revenue of $11.7B (+6.2% Y/Y) beats by $220M.
    • FedEx (NYSE:FDX) reports U.S. domestic package volume rose 5% Y/Y during FQ1 in its Express segment.
    • Ground segment daily volume was up 6%.
    • Operating margin +130 bps to 8.5%, led by a 330 bps jump in Freight segment operating margin.
    • Guidance: A prior view for FY15 EPS of $8.50-$9.00 is reaffirmed. Capital spending for the fiscal year of $4.2B is expected.
    • FDX +2.0% premarket
    • FedEx (NYSE:FDX) says it purchased 5.3M shares of common stock in FQ1 to tap out its existing share repurchase allowance.
    • The buybacks boosted EPS by $0.15 per share.
    • Previous: FDX earningsdetails.
    • General Mills (NYSE:GIS): FQ1 EPS of $0.61 misses by $0.08.
    • Revenue of $4.27B (-2.3% Y/Y) misses by $110M.
    • Press Release
    • General Mills (NYSE:GIS) reports a drop in volume sliced off two points of growth in FQ2.
    • Price realization and mix added a point to sales growth.
    • Revenue growth by segment: U.S. Retail -5.4% to $2.44B; International +2.3% to $1.35B; Convenience Stores and Foodservice +1.1% to $473M.
    • Gross margin rate -320 bps to 33.7%.
    • SG&A expense ratio +30 bps to 20.3%
    • Wynn Resorts (NASDAQ:WYNNwon the sole license for a Boston-area casino, despite a rough campaign.
    • CEO Steve Wynn took potshots at state regulators during the process and famously caught a quick nap during one gaming commission meeting.
    • The company and its top exec will likely be on its best behavior with the $1.6B casino project now in the hands of Massachusetts voters.
    • Senator Elizabeth Warren has stated publicly she will vote to repeal the 2011 legislation that approved three casinos in the state.
    • MGM Resorts (NYSE:MGM) and Penn National Gaming (NASDAQ:PENN) have interests in the other two and will be lobbying voters along with Wynn.
    These guys are reasonable again!  Gogo adds Virgin Atantic
    • Virgin Atlantic will be the first European carrier to partner with GOGO for in-flight connectivity services. The principal terms between the two have been agreed to and the sides are working to finalize a definitive deal. Under the agreement, all of Virgin Atlantic's existing aircraft will be retrofitted with Gogo's 2Ku service.
    • Source: Press Release
    • Sony (NYSE:SNE) is warning of a ¥230B ($2.2B) net loss for its current fiscal year, compared with its previous forecast for a ¥50B loss, after being hit with a ¥180B ($1.7B) impairment charge in its mobile communications segment.
    • In addition, the Japanese electronics maker says it will also not pay a dividend this business year.
    • The announcement marks the sixth downward revision under CEO Kazuo Hirai, who promised to revive the firm's troubled electronics division when appointed to the post in 2012.
    • The 10.7% boost in the quarterly payout to $0.31 per share (an annualized yield of 2.65% based on last night's close) is below expectations, says Goldman, maintaining its Sell rating and $36 price target.
    • The increase, however, was roughly inline with a Bloomberg survey which estimated the dividend being lifted to $0.30.
    • Among those positing a more aggressive move was Citi's Walter Pritchard, who saw a boost of maybe 25% along with targeting a payout ratio of around 70% for the fiscal year ending next June.
    • MSFT -1% premarket
    • Previously: Microsoft hikes dividend 11%, adds two new directors

  23. Good morning everyone!

    This week's webinar replay is up on our YouTube channel! Check it out here:

    http://youtu.be/105ekhyzLcM


  24. /TF hit 1,150 already – don't be greedy, the idea is just to pay for any short losses.  /ES 1,995 got me to add some more shorts but tentative on early trading.  Oil testing $94.75 again and I like scaling in here to $95 with $95.19 being the spike high so far – also very dangerous into inventories at 10:30.  Keep in mind that API has set low expectations now.  


  25. Greg / replay

    Do you have a direct link from Webex for the replay? I like to file them locally and it’s a pain in the rear end to do that from Youtube. Thank you.



  26. GTAT / Phil – My guess is that there was never going to be a screen business but someone who apparently was not in the know started rumors (it does happen I am told) and that propped up the stock! 


  27. TASR/ Never mind. Did the same thing yesterday morning!



  28. Sapphire glass

    It is a watch thing especially for those that put the watch on bottom of wrist. Even on top they get rubbed against things constantly. Check out a cheap watch after a year or so, scratches. If hit with much impact sapphire cracks easily. Hardness and brittle are laws of nature.


  29. Phil / 5%

     

    Is anybody  TM (trademark)..ing  something like that?


  30. Sapphire cracking:

    I know this is not a GTAT product, but nonetheless it is Sapphire. Test looks pretty good to me? You can't prevent everything, and the test seems pretty adequate for most likely situations. 

    https://m.youtube.com/watch?v=g_7tVP5YHt0


  31. Cool – $95 on oil again – Game on!  

    Replays/Akad – What's wrong with our YouTube channel?  

    TASR/Griffin – Imagine if every time someone was hurt by a gun they made such a big deal about it? 

    Homebuilder sentiment way up – that's a booster, although maybe it's not because then why would the Fed need to ease more?

    Germany/StJ – Wow, that's interesting.  I wouldn't think US so big either.  I guess we took away so many people's credit cards that the usage has dropped.  

    Income/StJ – Sickening. 

    $94.50 again on /CL – Wheeeeee!  

    5% Rule/Advill – I guess I should but I think I've established usage at this point. 

    Good article from NYT:  "You Can't Feed a Family with GDP":


  32. re: GTAT, there is a guy on Seeking Alpha that has done some write-ups on a few of the other products they are developing, links as follows:

    http://seekingalpha.com/article/2477715-gt-advanced-technologies-what-is-the-value-of-the-sic-business

    http://seekingalpha.com/article/2480795-gt-advanced-technologies-valuing-the-solar-materials-business

    I understand that they had originally intended a press conference in the fall to talk about their Merlin and Hyperion products.  So the Sept 29 call may be about that, or about sapphire, or possibly both. But at any rate, I'm still trying to get my head around some of these technologies they're working on, but there seems to be more to the story than just sapphire..


  33. Volume not impressive for this mornings spike.


  34. Phil / YouTube

    The problem is that I like to keep the webinars locally so I can review them at my leisure, with or without Internet connectivity. Downloading from the Webex site is a breeze, while downloading from YouTube is a pain in the posterior. That’s all. Since the Webex link already exists and adds no extra work for Greg that is why I ask. If this is a problem for you I won’t ask again.


  35. https://www.youtube.com/watch?v=v7xD3Oa5x1A

    dclark

    That phone has impact rubber areas to absorb crashes, it is heavy and large, that is why the liquid metal edges made no sense as they would increase the problem.


  36. Sapphire/DC – That's more in line with what I understood.  No way to know what's true but it does seem to me that "THEY" are out to assassinate GTAT to chase the price down ahead of a real announcement.  Here's another guy who studied it pretty closely.  

    GTAT/Pwright – Yes, as I said last week, they are serving diverse markets, AAPL is a bonus but not make or break for them.  

    Webinar/Akad – Not a problem (for me at least, not sure what Greg has to do) – I was just curious but, then again, with my LTE on my iPhone and iPad, I can't remember a time in the last couple of years I couldn't watch YouTube at will. 

    Oh no!  There goes oil with a 3.7M BUILD – $94.25.  Gasoline 1.6Mb draw mitigates it slightly and gives hopeful demand picture (/RB $2.565) and Distillates up just 300K so, on the whole, as we expected – disappointing and not supportive of $95 but expect a fake back up before $94 breaks so stop at $94.25 and back in below $94 or back at $94.75+.


  37. Mess / Phil – I am so sick and tired of seeing people like McCain and Graham on TV blasting Obama for the problems in Iraq when we would not be there if they had not pushed for that moronic $1T war to begin with. The most frustrating part is that no journalist does point that out to them… 


  38. No stops on oil, just failed $94.  Another good call!


  39. $1Tn/StJ – Wow, did you get a $3Tn refund?  cheeky

    Oil/Bruce – I'd set the stop at $94 now, same logic.  Don't forget it's a Fed day – anything can happen.  

    Wow, my S&P shorts are finally paying off, 1,993.  Still want to see 1,980 though.  


  40. Phil

    I watched all 3 videos, all the way. Sapphire is touted as scratch resistant over and over, no claims for cracking. At the end of your video in slow motion they show the sapphire shattering. The video I posted details the rubber edges.

    As far as GTAT goes they are selling some for phones and there are many great uses for it but without the touchscreen a new watch face costs at least $100 to replace. This is clearly a case of people not knowing what they don't know and saying it anyway.


  41. Don't forget AAPL said it flunked the drop test! Why would they lie?


  42. ~Summary of Weekly Petroleum Data for the Week Ending September 12, 2014
    U.S. crude oil refinery inputs averaged over 16.3 million barrels per day during the week ending September 12, 2014, 28,000 barrels per day less than the previous week’s average. Refineries operated at 93.0% of their operable capacity last week. Gasoline production increased last week, averaging about 9.2 million barrels per day. Distillate fuel production decreased last week, averaging 4.9 million barrels per day.
    U.S. crude oil imports averaged over 8.1 million barrels per day last week, up by 493,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 7.8 million barrels per day, 3.7% below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 327,000 barrels per day. Distillate fuel imports averaged 160,000 barrels per day last week.


  43. ~~Crude oil inventories (weekly change) -1.0 M barrels 3.7 M barrels
    Gasoline (weekly change) 2.4 M barrels -1.6 M barrels
    Distillates (weekly change) 4.1 M barrels 0.3 M barrels

    That is a build and prices going down so likely the spike was OPEC rumors.


  44. Shadow:

    Yes, I agree that it will shatter from an extreme drop, but I don't think anyone is protecting from the worse case scenario. On the video I displayed I thought the producer provided a fair example of some real life situation and it did fairly well. The only thing I can't tell is if it will shatter if impact is made on the corners or the sides.  The real question will boil down to whether or not the added protection will justify the added costs.  It's certainly better than the old screens.


  45. Speaking of why we have a deficit – here's another thing people seem to forget that GWB and the GOP gifted to us:

    Hmm, all I can say after watching that is:

    I think I'll be using that a lot!  

    Sapphire/Shadow – So it's not shatterproof, what's your point?  It's clearly MUCH more scratch-resistant and then they have to decide what's more important to users.  Where did AAPL say they flunked the drop test?  Please try to back up your statements with some kind of links – people are investing their money here – we like to get things right.  

    As far as GTAT goes, they got their $500M from AAPL on a 5-year contract last November so it's one year in and GTAT gets $125M a year whether AAPL uses their stuff or not.  On that basis, GTAT ramped up production and was able to build new manufacturing facilities and, it seems the goal was to make faces for iWatches, not iPhones.  The stock went from $10 at the time to $20 and now back to $12 I'm pretty happy with them ($1.6Bn valuation) with $300M in sales since they made $200M in 2012 (but not in 2013 or 2014 as they re-tool) and even if they drop to 1/2 those profits, I can live with a p/e of 16.  

    All this BS about the iPhone is just noise, and all of you should know better than to be distracted by this nonsense.  GTAT has very little consumer electronics business and, as you can see from this picture from the Annual Report, they never said Sapphire would be big in that field – that's what they are developing the Hyperion system for.  

    If all your knowledge of this company comes from whatever the last guy on Seeking Alpha told you – then you are not doing yourself or anyone else a service by arguing the point – one way or the other.  

    GTAT is currently at $12.20.  We sold 10 2016 $12 puts in the Income Portfolio for $3.20 ($3,200) and they are now $3.80 and I still like those, and I'd like to add 20 of the $12/17 bull call spreads at $1.50 ($3,000) as those are then net free and, if GTAT falls further, I'm going to be happy to sell 10 more puts for $5 ($5,000) and that would give us a net $5,200 credit on 20 shares at $12 or a net $9.40 on 2,000 shares ($18,800) as our worst case.  

    And, while we're in a buying mood, let's take a poke at GOGO ($18.40) and sell 10 of the Feb $17 puts for $2.20, also for the Income Portfolio.  That's a net $14.80 entry, almost 20% off if we get is so cheap.  Otherwise, our consolation prize is $2,200.  



  46. What are the drop test specification for a I phone ?

     


  47. Vacation Days:

    The Congress or Senate never work that many days!

    http://thomas.loc.gov/home/ds/


  48. https://autos.yahoo.com/news/the-states-with-the-rudest-drivers-%e2%80%93-and-the-states-that-hate-them-210526950.html

    No surprises here, #1 Idaho, #3 New York, #4 Wyoming, #8 New Jersey, and #10 Utah. Vermont and Delaware tied for 6th still don't get slow speed limits are more dangerous.



  49. DX

    •Dynex Capital (NYSE:DX) declares $0.25/share quarterly dividend, in line with previous.
    •Forward yield 12.02%
    •Payable Oct. 31; for shareholders of record Oct. 3; ex-div Oct.1.

    I've mentioned DX before.  I've owned it since 2010.  During that time the dividend has been much more stable than those of NLY & AGNC.  Check it out.

    http://www.nasdaq.com/symbol/dx/dividend-history

    http://www.nasdaq.com/symbol/nly/dividend-history

    http://www.nasdaq.com/symbol/agnc/dividend-history


  50. Drop test was posted here last week, Who when? I never lie! I even posted that the shattering could be solved with 2 changes but style won over durability. And why do people pay money to replace the glass?

    It broke and sapphire would at least double that cost. Fact should be known when investing and on Yahoo finance they mention the I6 plus may not be a fit for females. Links are only someone's opinion but if they are the only thing you believe you better be careful.

    I said yesterday I was done on AAPL this is about GTAT and liquid metal would increase shattering.


  51. Another entry at $94.50 on /CL


  52. Phil

    FAS,OIH roll after fed  ?

    Thanks


  53. VIX: The CBOE will be changing the formulas for calculating the VIX on October 6 of this year. As I understand it from Kaufman's explanation, the new calculations will include weekly options; currently only monthly options are used.

    The CBOE has a white paper on these changes:  Warning, may be for math geeks only.

    http://www.cboe.com/micro/vix/pdf/NEWVIXWHITEPAPER-AddingSPXWeeklys.pdf


  54. China Banks/Shadow – I think it was a stealth emergency bail-out, not stimulus.  If one major Chinese bank fails, that whole house of cards will tumble down at lightning speed. 

    Drop test/QC – Sapphire beats in every category – really a question of "by how much?":

    Sapphire properties, as per GT Advanced

    Congress/DC – Well at least they work more than they used to.  

    Drivers/Shadow – If you could isolate Long Island, they'd win by a mile. 

    Thanks Greg.

    DX/Albo – Yes, a good one, nice call.

    Submitted on 2013/08/16 at 6:56 am

    DX/Albo – They're a good-looking one, mostly invested in MBS so subject to panic in a downturn.  Still, you can buy them for $8.32 and sell the March $7.50 calls for $1.15 and the $7.50 puts for .40 for net $6.77/7.14, that makes the $1.16 dividend 17% while you wait!

    Such a nice, relaxing way to make money!  

    Drop test/Shadow – No one said you lied, but I still say you are mistaken.  You say AAPL said they failed drop test – no such thing ever happened.  That then, is not a true statement and I assume it's unintentional but, for the sake of not misinforming people, I need to make a point that what you said was wrong.  Restating your incorrect statement, still without a link, doesn't make it correct.  

    Oil/Bruce – and another drop below $94.25, very nice!  

    Rolls/QC – I want to see what the Fed does first.  

    I won't be here tomorrow (just for a bit in the AM) as I have to go give a deposition that I can't get out of so I'll likely be tied up from 10:30 on so I MUST go over the Portfolios today – at least the 3 shorter-term ones with rolls that have to be made.  That will be what I'll be doing from 2:30-4 today, for sure.  

    TASR update on coma story:

    The Independence Police Department identified the officer as Tim Runnels. He used the stun gun on Masters while the teen was still inside of the car. Maj. Paul Thurman, with the Independence police force said that the teen was able to get out of the car at some point, but later he fell.

    Runnels incapacitated the teen with the 50,000 volts of electricity being discharged into his body. Then Runnels threw him to the ground causing him to hit his head on the pavement, lose consciousness and stop breathing.

    There's nothing good about this story but TASR's don't cause comas.  What TASRs have done is led to a dramatic drop in police shootings (see above).  TASR still down 4% at the moment but not too much damage after that nice run.  


  55. akademia/youtube – try Keepvid.com. Very easy to download YouTube videos.


  56. Does anyone have news on why WFM is up today?  It's at the top of it's 3mo range.  Another fake up or poising to break out?


  57. Thanks CaFords, that's very useful!  

    WFM/Jeddah – From our Buy List:  

    WFM (5/13) I have not liked for ages but $39.43 finally gets their p/e into the low $20s and they are moving into the UK and, as we've discussed before, they are merely getting squeezed by rising food costs they haven't passed on to customers yet.  

    This one is easiest played by just selling puts and you can get $3 for selling the 2016 $33 puts and that gives you a net $30 entry, another 25% down from here.  TOS says net margin is $3.30 so almost 100% return on margin for promising to buy WFM for 25% less than it's trading for now – not too shabby (added at $3.45 to our Income Portfolio along with the 2016 $35/45 bull call spread at $3.65 for net 0.20 and already $2.40 – up 1,100% on cash!)

    That one is still playable today!  Nothing particular to boost it now, other than the silly-low price.  

    [video] Whole Foods to Test Rewards Program

    Jim Cramer on Grocery Stocks: Whole Foods Is Easy to Swallow

    [video] Whole Foods has bright future: Co-CEO Robb


  58. Phil / GOGO … can you provide the brief fundamental rationale for investing in GOGO please…thanks


  59. Phil;  Are you going to stay short ES into the 2:30 event?


  60. https://www.youtube.com/watch?v=TCR0R4W4qCo

    Phil QC mike

    This is the actual name of the u-tube video in Phil's link, you can't scratch it easily, that is all they say! 

    ~~Kyocera Brigadier sapphire shield glass scratch test


  61. Phil // Flies
    May I ask for a quick summary of the fly changes this week. These expire in 2 days

    DIS
    OIH
    WMT

    Phil // RIG
    I'm watching this. Wondering if you would take any action.
    +10 Jan16 $35/45 Bull Call ( $3.65 )
    -10 Oct $38 short calls ( 0.47 )
    Jan16 $33 short puts ( $3.00 )
    Current tracking is -34%

    Thanks 

     


  62. Greg / Link

    Thank you Greg.

     

    CaFords / Keepvid

    Thank you for the link. That certainly makes it easier, but the quality of the Webex original is MUCH better.


  63. youtube/download

    use CC convertor. web based – download you tube videos using the link to any video format. Also can extract just music from the videos. keepvid is also good.


  64. Car Thefts
    I find this very strange. The hottest in the nation is up in NorCal. I mean way up by Humbolt County ( weed central ) Pretty sparsely populated – can't really explain it.
     


  65. they just showed that new iphone…the big one….its massive!!! looks ridiculous…especially for women….and piper out saying apple pay is a gimmick to get iphone purchases…will only contribute .2% to operating income in 2015….and i think the watch will be viewed as a bust initially….is anyone getting increasingly worried about it?


  66. im tempted to buy yen for trade here…look how oversold it is…and if fed remains uber dovish but just tweaks language….dollar should weaken for at least a few days


  67. http://venturebeat.com/2014/09/12/new-source-confirms-apple-originally-planned-sapphire-screened-iphone-6/

    http://apple.slashdot.org/story/14/09/14/1440232/sapphire-glass-didnt-pass-iphone-drop-test-according-to-reports?utm_source=rss1.0mainlinkanon&utm_medium=feed

    Phil I know you recommended GTAT on the drop and I think sapphire glass has uses. Ever notice windshields get chipped eventually every inch from dirt to bugs, hard to see in bright sun or at night. If a thin coat and it is a sandwich, on the outside and no more pitting. Insurance says average use before visibility restriction is 3 years. That would end although a rock would break it easier.


  68. Phil – I looked at your spread on DX from last Aug. and compared to what's available today on the same spread.  Can't get anywhere close on the premiums.  Shows the lack of volatility today.  Good example of the complacency now.


  69. I can't remember names, WHY? My memory is beyond most and it does cause arguments but it is useless when I am sure because I remember some things in HD vision and sound. Names, I think it was Stjean that posed the link last week but that could be wrong and he likely doesn't remember either.


  70. Phil

    I have an old solid gold watch. The only place that fixes them want $500 to refurbish and $150 to replace the broken sapphire crystal, plus shipping. I need the surgery more and someone to get me released from the hospital, they won't let you leave alone.


  71. GOGO/DM – They are up to about 2,500 planes that fly an average of 300 passengers a day so 275M chances a year to make a sale.  Current sales are $328M in 2013 up from $233M in 2012 and trending to $400M this year for 20% growth and they don't make any money (building phase) but they are only valued at $1.5Bn, which is 4x current sales – very cheap for a tech company.  Their contracts run 5-10 years and they have 80% of North America so it's simply not possible for anyone to compete with them this decade which means, like cable companies in the 80s, their investment in infrastructure will pay off huge.  They have $200M in cash and are burning about $30M per Q so a long time before they need money (if ever again).   So, short story is there's a ton of potential and also a possible buyout at this price from one of the internet carriers down the road as GOGO is pulling in about $9,000 per flight, so about 1/3 of all the people on the plane use it and it's trending up.  If I were VZ, and I wanted a way to get in front of 275M people and convert 20M of them, I could pay the industry avg $300 per subscriber ($6Bn) or I could buy GOGO for $2Bn…

    VIX/Jbur – That will be interesting.  

    /ES/Options – Well I'm up $2K on 10 and I am nervous about it.  At 1,990 I should be dropping to 5 but I'm feeling greedy as I can't imagine what the Fed could do to burn me (famous last words).  If we hit 1,980 before hand, I'm out, 1,985 – maybe/probably.  

    Flies/Wombat – I will go over them after the Fed. 

    RIG/Wombat – Not at the moment.  Haven't seen where a new range is being established.  Their $3 dividend is now 7.6% and I have not heard of any changes.  Last Q they dropped $500M to the bottom line so, if anything, I'd sell more puts and hope to own the stock but, for the moment, I'm content to watch.  

    Cars/Wombat – Seems to me like a ring operates up there.  Perhaps it's the low population with lots of nice cars in isolated areas?  

    AAPL/Angel – I'm not worried.  People look ridiculous with those big Galaxy notes too but they sure do buy them.  Also, I notice a lot of people walking around NYC using iPads to take pictures.  Not even Minis – full iPads.  I don't get it but apparently size matters to people and I don't see how having a phone in every size is going to hurt AAPL.  The watch is totally not my sort of thing but people seem to want them too. 

    Exane BNP Paribas analyst Alexander Peterc boosted his price target on Apple (NASDAQ: AAPL) to $130.00 (from $100.00) Monday after factoring in the company's newly announced Apple Watch and iPhone models. The analyst believes the Watch has the potential to substantially expand the reach of Apple's iOS ecosystem.

    The analyst said while it remains to be seen if Apple cracked yet another UI/UX conundrum, particularly with the “Digital Crown” Apple’s new category leads them to hike EPS forecasts by 10% for FY15 and by 16% for FY16; 2017+ estimates rise by c.25%.

    "The success or failure of the device now largely depends on the ingenious developer community that should be able to come up with new, unexpected use cases that will turn this “nice to have” accessory into a “must-have”, at least for the tech-obsessed fashion-conscious iPhone users – and there should be enough of those to fuel at least the first year of sales, in our view," Peterc said.

    In an attempt to assess the addressable market of the watch, the analyst notes over one billion watches are exported annually. Also, mobile phones and smartphones come to mind, with respectively 1 billion and 1.8 billion units sold annually. In dollar figures, the analyst notes that smartphone market more than doubled in seven years, from “pre-iPhone” levels of $120bn (in 2006) to $260bn-$300bn in 2013. "… the smartwatch industry’s addressable market is nearly certainly an order of magnitude bigger than the current watch market in value terms," the analyst contends.

    On the firm's estimate and valuation upgrade, the firm stands by their logic that "each new Apple category (iPod, iPhone, iPad) tends to sell in roughly 2X the volume of its direct predecessor measured in volume since launch…" He added, "Applying the “2X iPad, 4X iPhone, 8X iPod” arithmetic to projections of iWatch volume is, in our view, particularly useful for the initial quarters. We have then applied what we believe to be reasonable seasonality to this first set of estimates, and moderated somewhat the later years (2017 onwards) as the exponential reasoning we apply in the initial model quickly leads to possibly unreasonably large numbers (100m+) that does not accurately take into account saturation within a relatively limited (likely 200m+) user base of compatible iPhones – this is hardly the mass market the iPhone or iPad were addressing (no need for a previously owned iDevice) – a big difference in the Watch’s potential vs preceding iDevices, in our view."

    Imagine that, an analyst who still backs up his estimates with facts and figures – good thing he doesn't cover TSLA or NFLX!  

    Yen/Angel – Good idea, I just posted an article re. the Keiretsu reading Kuroda the riot act as raw material prices are starting to kill them.  Yen at 107.59 now and Dollar 84.23 is not likely to pop 85 no matter what Yellen says so I think it's a good reward/risk scenario betting the Yen down (stronger) from here off the Fed news.  

    GTAT/Shadow – You do realize that a post in Slashdot from "samzenpus" quoting SternsheFan citing a VentureBeat article that says "cracked during standard drop tests conducted by Apple SUPPLIERS" is NOT AT ALL THE SAME THING AS APPL OFFICIALLY SAYING THEY FAILED A DROP TEST!!!  Jeeze, do I really have to go back and forth on this all day?  

    Here's a FACT:  AAPL ONLY gave GTAT $500M.  At $100 a screen (too much, but let's pretend that rumor is real), that would only pay for 5M screens or about the first month's shipping.  THEREFORE there is no way at all that AAPL or GTAT ever planned for the iPhone 6 to ship with Sapphire – it's a ridiculous premise and from that, all of this BS about failing drop tests or inadequate batches is just BS piled on BS – it is meaningless rubbish that has NOTHING to do with the value of GTAT but it is a fantastic tool for market manipulators to get gullible people to pass around nonsense and distract investors from making rational decisions based on FACTS.  

    DX/Albo – I know, it's so annoying that you can't get good spreads these days.  This too shall pass…

    Wow, RUT dove back to 1,145, /ES 1,989 failing too!   Now we can set a stop at 1,990.  


  72. angelcur/ big iphone for women

    Women have purses to carry around bigger phones.  Whey my wife's phone rings she's always fumbling around to get it out of her purse.  For her, the bigger the phone, the easier it is to find among all the other 20 things she carries around in that bag.

    Ladies, chime in here if I'm wrong


  73. Phil did an excellent review on rolling 5/21/13. I never figured out how to search the site but frequently people ask about rolling at it was the best. Good luck finding it.


  74. SCO is climbing slowly and steadly!



  75. For reference, last Fed statement:

    Release Date: July 30, 2014

    For immediate release

    Information received since the Federal Open Market Committee met in June indicates that growth in economic activity rebounded in the second quarter. Labor market conditions improved, with the unemployment rate declining further. However, a range of labor market indicators suggests that there remains significant underutilization of labor resources. Household spending appears to be rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Fiscal policy is restraining economic growth, although the extent of restraint is diminishing. Inflation has moved somewhat closer to the Committee's longer-run objective. Longer-term inflation expectations have remained stable.

    Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators and inflation moving toward levels the Committee judges consistent with its dual mandate. The Committee sees the risks to the outlook for economic activity and the labor market as nearly balanced and judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat.

    The Committee currently judges that there is sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions. In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions since the inception of the current asset purchase program, the Committee decided to make a further measured reduction in the pace of its asset purchases. Beginning in August, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $10 billion per month rather than $15 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $15 billion per month rather than $20 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee's sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee's dual mandate.

    The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. If incoming information broadly supports the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will likely reduce the pace of asset purchases in further measured steps at future meetings. However, asset purchases are not on a preset course, and the Committee's decisions about their pace will remain contingent on the Committee's outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases.

    To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that a highly accommodative stance of monetary policy remains appropriate. In determining how long to maintain the current 0 to 1/4 percent target range for the federal funds rate, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. The Committee continues to anticipate, based on its assessment of these factors, that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.

    When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.

    Those are the magic words everyone will be watching – "considerable time".  Any change to that will be a market mover.  


  76. Big Phones:


  77. Phil

    Smart phones and the Verizon ads to watch foot ball. Wasn't football the big seller or big flat panel TVs?

    The last picture isn't big enough for the big game. HEHEHEHEHE!!


  78. Another twisted sales pitch is new curved screen OLED TVs. Not that long ago it was get the new flat screen, oh but now its' concave instead of convex. Only $12,000.


  79. Well, a burst of enthusiasm into the Fed statement stops out the /ES shorts.  Now we'll just have to wait and see.  Don't forget Yellen speaks at 2:30 – also a huge mover.  


  80. NO CHANGE!!!  QE ends next month (been winding down) but not likely to raise rates any time soon.  This is not bullish or bearish but I'm inclined to get back to shorting now.  


  81. Same levels, of course.


  82. Dollar – zoom! no change does this?


  83. Release Date: September 17, 2014

    For immediate release

    Information received since the Federal Open Market Committee met in July suggests that economic activity is expanding at a moderate pace. On balance, labor market conditions improved somewhat further; however, the unemployment rate is little changed and a range of labor market indicators suggests that there remains significant underutilization of labor resources. Household spending appears to be rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Fiscal policy is restraining economic growth, although the extent of restraint is diminishing. Inflation has been running below the Committee's longer-run objective. Longer-term inflation expectations have remained stable.

    Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators and inflation moving toward levels the Committee judges consistent with its dual mandate. The Committee sees the risks to the outlook for economic activity and the labor market as nearly balanced and judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat since early this year.

    The Committee currently judges that there is sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions. In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions since the inception of the current asset purchase program, the Committee decided to make a further measured reduction in the pace of its asset purchases. Beginning in October, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $5 billion per month rather than $10 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $10 billion per month rather than $15 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee's sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee's dual mandate.

    The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. If incoming information broadly supports the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will end its current program of asset purchases at its next meeting. However, asset purchases are not on a preset course, and the Committee's decisions about their pace will remain contingent on the Committee's outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases.

    To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that a highly accommodative stance of monetary policy remains appropriate. In determining how long to maintain the current 0 to 1/4 percent target range for the federal funds rate, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. The Committee continues to anticipate, based on its assessment of these factors, that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.

    When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.


  84. Fed Projections:

    Variable Central tendency1 Range2
    2014 2015 2016 2017 Longer run 2014 2015 2016 2017 Longer run
    Change in real GDP 2.0 to 2.2 2.6 to 3.0 2.6 to 2.9 2.3 to 2.5 2.0 to 2.3 1.8 to 2.3 2.1 to 3.2 2.1 to 3.0 2.0 to 2.6 1.8 to 2.6
    June projection 2.1 to 2.3 3.0 to 3.2 2.5 to 3.0 n.a. 2.1 to 2.3 1.9 to 2.4 2.2 to 3.6 2.2 to 3.2 n.a. 1.8 to 2.5
    Unemployment rate 5.9 to 6.0 5.4 to 5.6 5.1 to 5.4 4.9 to 5.3 5.2 to 5.5 5.7 to 6.1 5.2 to 5.7 4.9 to 5.6 4.7 to 5.8 5.0 to 6.0
    June projection 6.0 to 6.1 5.4 to 5.7 5.1 to 5.5 n.a. 5.2 to 5.5 5.8 to 6.2 5.2 to 5.9 5.0 to 5.6 n.a. 5.0 to 6.0
    PCE inflation 1.5 to 1.7 1.6 to 1.9 1.7 to 2.0 1.9 to 2.0 2.0 1.5 to 1.8 1.5 to 2.4 1.6 to 2.1 1.7 to 2.2 2.0
    June projection 1.5 to 1.7 1.5 to 2.0 1.6 to 2.0 n.a. 2.0 1.4 to 2.0 1.4 to 2.4 1.5 to 2.0 n.a. 2.0
    Core PCE inflation3 1.5 to 1.6 1.6 to 1.9 1.8 to 2.0 1.9 to 2.0   1.5 to 1.8 1.6 to 2.4 1.7 to 2.2 1.8 to 2.2  
    June projection 1.5 to 1.6 1.6 to 2.0 1.7 to 2.0 n.a.   1.4 to 1.8 1.5 to 2.4 1.6 to 2.0 n.a.  

    Dollar popping higher on fairly hawkish tone but 84.54 so far.  

     

     


  85. phil – market surge — how can the market move up like that, has to be coordinated stop grabbing, doesn't it? 

    the market is suddenly over come with a groundswell of buying (on new fed language) then gets run the other way dramatically? 

    seems so manufactured


  86. looks like the stops were cleaned out on both sides and we're right back to where we started


  87. @toe

    Market is not settled at all yet, these are HFT programs going off algorithms or certain words and making money off the volatility.


  88. Look at that – a 15 point swing on /ES in 1 minute. Unplayable as your limits just get busted and actually you can lose money really quickly on an event like that even when you bet the correct direction because your order might come in 5 points below your limit and if they reverse, you are 5 points in the hole to start! Happened to me on a jobs release day and I can't be bothered to play this anymore…


  89. You have to bet one way or the other before the release to get your price… No one but bots can get in after that and they screw the little guys!


  90. If you play short term never use stops of any flavor.


  91. Markets recovering despite the 0.3% dollar move up!



  92. I guess they now tank the dollar and 2000 here we come!


  93. S&P 2000 now. Damn, could not see that coming :-)


  94. OK, so the end of taper may have been unexpected but the "considerable time" thing is still there so I don't see this as all that hawkish on second read.    CNBC certainly spinning it doveish and now Yellen gets to spin it too so too dangerous to short.  

    Market/Toe – Most traders are idiots and now they have machines that are programmed by idiots that read the headlines and react based on that "input" and there's 10x more machines trading than people these days.  It's just all idiocy around these events – not something worth worrying about, on the whole.  

    So much for going long Yen, rocketed up to 108 so far but NOW I like it short! 

    /NKD popped to 15,950 on that news too – have to see where it settles.  

    FT Summary:

    The US Federal Reserve made no change to its guidance that rates would stay low for a “considerable time” after it stops buying assets in October, a statement that prompted dissent from two Fed officials.

    The statement notes an unemployment rate that is “little changed”, suggesting Fed chair Janet Yellen has prioritised support for the economic recovery over the concerns of officials who worry that interest rates may need to rise early next year.


    But the Fed’s new statement shows the building pressure for a change of guidance, with new interest rate forecasts pointing to a faster pace of rises. Instead of an interest rate of 1 – 1.25 per cent at the end of 2015, the FOMC now expects a rate of 1.25 – 1.5 per cent.

    Fisher and Plosser dissented, so watch out when they speak next.  

    I still like /ES short at 1,995 but /TF just hit 1,155 and that looks good to short too!  


  95. 1020 WOW!

    $8K to under $3K shows they aren't selling and this is still 3 times the best flat panel.

    Factually I love OLED and I posted results back when they were 3 inch. The clarity, speed, and color accuracy are unequaled, only CRTs came close, the 3 tube type. I just don't see the price drop curve kicking in, they are complicated to make. 



  96. Fed predictions / Phil – Look like we are at best a 2.5% growth economy at this point. And why should be surprised, the law of big numbers eventually catches up to you. China is finding that our right now. Growing a $17T economy by 5% means $850B of new output creation. Not that easy.

    On the other hand, the Fed doesn't see any inflation as far as 2017. Below 2% all the way. I hope that they are right but of course higher inflation has its benefits as well – as long we stay below the Venezuela 500%!


  97. 2.5% growth is very impressive when you do it without hiring any people, building any buildings or investing in any infrastructure!  


  98. Shorts not working so far.  17,110 on /YM, 1,999 on /ES, 4,075 on /NQ and 1,155 on /TF.  Is it just me or do you guys feel like we've been here before?  


  99. stjean

    They can't have cake and eat it. If the economy expands inflation will kick in and if inflation doesn't kick in the economy will contract. This is a supply side argument that has never been correct. 2.5% growth is only with changed calculations and 1.7% inflation is no different, both deceptions. 


  100. Dollar harshly rejected at 84.60 and back to 84.30 now.  VIX power-dives from 14.5 to 11.9, TLS 113.50 flat but XLF very happy at $23.67, which sucks for our FAS roll. 

    And now, here's Janet!  


  101. VIX/Phil

    Of course the VIX went down, there is absolutely no volatility in the last 30 minutes.


  102. VIX / Rustle – I wish they would just change that name as the VIX doesn't really measure volatility anyway!


  103. rustle VIX

    If memory serves me and the VIX falls into I don't pay attention it was up over 3% and now down 6%. What are you saying? 9% change inter day is normal.


  104. Maybe some competition for our current internet monopolies:

    http://www.engadget.com/2014/09/17/google-fiber-gets-new-leader/

    Worried that Google Fiber would just be a momentary fascination for the folks in Mountain View? Don't be. Google has confirmed to the Wall Street Journal that it recently hired Dennis Kish, one of Qualcomm's bigger senior vice presidents, to lead its gigabit internet efforts. While it's not clear why Kish came onboard beyond his "operational expertise," he's no stranger to managing big tech projects. Among other work, he played key roles in both Qualcomm's Mirasol display efforts and ST-Ericsson's connectivity business. That kind of know-how could be crucial given Google's expansion plans, especially if rumors of mobile phone service pan out. It's too soon to gauge Kish's influence, but a high-profile hire like this suggests that Fiber's super-fast data service is only going to get bigger — and that your local telecom giant may well get some genuine competition.

    And GOOG has the money!


  105. VIX/stjeanluc:

    I doubt that most people who trade VIX options know that VIX options are not actually on the VIX,  since the VIX is not a tradeable product.   VIX options are actually on the VIX futures, and each monthly expiration on the options chain corresponds to the VIX futures contract for that month. There is no direct correlation between the VIX quoted on the options page and the options themselves.

    Could they have made it any more obtuse?


  106. JPY/Angel – thanks for the callout. was watching when spiked and got in a short position.


  107. stjean that post is seriously wrong.

    Just like we always had enough copper wire they just had to share there is no use for multiple fiber lines, in fact multiples will cause more problems than solutions. The only logical possibility is Google may add to the missing links but they are mostly rural and that will take government intervention of some sort just like breaking up AT&T.


  108. short USD/JPY that is..


  109. Rural investment never prove profitable!


  110. Levels/Phil – you did want to see strong bounces today.. !


  111. Phil Like to have you view on the following YHOO play  Buy BCS Apr15 38/43 for 2.50 and sell Fridays 43.5 call for .98 c Based on the Alibaba IPO and possible keep on selling weeklies TIA


  112. heres what she meant:

    "the FOMC sees bubbles everywhere, but just a few places…and the committee members will make sure there is no single area of economy that is not in a full blown bubble before even thinking about raising rates…at such time…the committee will then wait until the bubbles start bursting on their own….at which time the committee will introduce qe4….and move to negative rates…."


  113. Change In Cash and Cash Equivalents(23,409)(46,770)(18,349)(27,463)

    Phil it looks to me that the quarterly cash flows on GOGO are all negative ????

    While annual looks all positive hard to understand?

    Change In Cash and Cash Equivalents

    153,766  

    69,985  

    23,708 


  114. Here is what >4T gets you on the Civilian Unemployment ratio


  115. From Slope

    From Slope of Hope


  116. DXD/Phil- I am holding Oct DXD calls to protect against downturn we thought might be coming this week. It doesn't look like that will happen this week anyway, so what would you recommend doing with those calls now? I am also holding January SQQQ calls which I thankfully have taken a beating on. Is it time to abandon these yet in your opinion? 


  117. Financials like the FOMC report.  At AH.  I own several,  esp. like BAC.  Thinking they are getting near the end of their "shoe dropping" chapter.


  118. yodi GOOG

    According to your post on cash levels Google could not run another fiber network.


  119. And as tapering began….S&P Chart….

    Again, from Slope.


  120. GOGO.. Thanks for the insight Phil


  121. EMN – the Jan16 $75 puts at 5.40 offer a nice 40% return (30% annualized) on $1330 regular margin requirement…  Damn!


  122. $25,000 Portfolio ($25KP):  I DID call those TQQQ puts off on 9/15!  Good, I feel better as I was kicking myself yesterday for missing that one.  This is a good time to remind people that you shouldn't wait for me to make good decisions.  The idea of these practice portfolios is to teach, by example, how we manage a portfolio over time.  Ideally, it should have been very obvious to all that we take the money and run on a nice dip 5 days before expiration without me having to specifically say so.  

    • GMCR – I hate these guys!  Last week those puts were $8.50 so they've cost us about 10% of the portfolio since then.  Of course, that was less than 10 days ago and we have 121 days to go and I WANT to DD but they went up in a weak market so I'm not inclined to spend more money here.  We'll just hope we get luckier next month. 
    • XLE - Oil is still weak so XLE still has room to fall – especially if people start warning pre-earnings.  
    • XRT – That was also in way better shape last week but I still like the play.  
    • YHOO – AliBaba set for 7/29 and we're already up to $3.40 but that's out of a possible $7 so not a candidate for cashing in early at all.  In fact, this is fantastic as a new entry if you can get that price (but probably you can't as it's a worst-case balance by the broker, not realistic).  

    Butterfly Portfolio: Not getting favorable moves but nothing tragic – just a disappointing month.  

    • BTU – Long-Term, no change.  
    • DIS – We sold $5.15 worth of puts and calls and the puts are expiring worthless and the short $85 calls are $5.39 in the money.  I want to hold those until the last minute, in case they turn down tomorrow but, for next month, because earnings are not until the week of 11/5 (Vegas, baby!), I want to sell the Oct $87.50 calls for $3.55 and the Jan $87.50 puts for $2.80 because it gives us good protection against good earnings, much more so than selling Oct $87.50 puts for 0.57.  
    • JPM – Another one that popped on us today.  We owe the short Sept $57.50 callers $2.95 and we'll let them run down but we'll sell the Oct $57.50 calls for $3.15 and the Oct $60 puts for $1.25 which gives us a winning range between $53.60 and $61.90 into earnings BUT we intend to roll out to a wider spread ahead of earnings as well.  By selling a $2.50 spread for $4.40, one thing we know for sure is that, in the next 30 days, that $1.90 of premium will run down quite a bit…
    • OIH – Wow, this one is on target!  We'll give the short Sept $53 puts a chance to improve into Friday (now 0.70) with a stop at 0.90 and we'll sell the Jan $52 calls for $2.25 and the $50 puts for $1.85 so we can ride out earnings with more cushion.  
    • TXN – Another one on target but, sadly, they are October contracts.  Too soon to pull them.  
    • WMT – Close enough.  The short Sept $75 calls are $1.32 in the money and we'll hope for a little pullback there (stop at $1.50) and WMT earnings aren't until mid-November so we'll collect $3.40 on a $2.50 spread and pick up a "free" 0.90 while we wait by selling the Oct $75 calls for $1.80 and the Oct $77.50 puts for $1.60.  

  123. ATVI/Stj – You mentioned you were going to get Destiny/play it?  I agree with the below that selloff seems a bit overdone.

    http://247wallst.com/technology-3/2014/09/17/is-destiny-video-game-sales-record-truly-a-disappointment/


  124. Quick question re: butterfly.  Are you recommending initiating these new positions in addition to waiting for the old ones to run down on Friday?  Or do we wait to initiate the new ones until we close out the September leg on Friday?


  125. Someone might have some splainin' to do:

    http://greencarreports.kinja.com/is-the-tesla-model-3-actually-going-to-cost-50-80k-1635817693/+matthardigree

    Tesla CEO Elon Musk has targeted a late 2017 launch for the Model 3 with a 200 mile range and stated goal price of $35,000. That range and price excites a lot of people. But what if that price is wrong? What if the Model 3's price tag is actually in the range of $50-$80k? That pricing is the most likely scenario according to noted battery skeptic Menahem Anderman. You can read a full breakdown of this over on Green Car Reports at the link below.


  126. ATVI / Scott – I don't know what expectations were, but they have sold a boatload of the game in a couple of weeks!

    I was going to try it, but it's on console only right now and my gaming is mostly PC at the moment…. We'll see.


  127. 200 mile range and $35K? Buying bridges in Brookline. Only a couple short range cars are at that price and Nissan is redoing the Leaf because of battery costs. 


  128. I don't know why I was thinking I was time-constrained.  I'll be here all day tomorrow, it's Friday I have to leave early…

    Insane market action, still looks pre-crashy to me but back where we started from at the moment.  Dollar finally did decide to go up, now 84.80 but /NKD back down to 16,000 from 16,035.  JPY 108.32 – still gotta have conviction to make these trades.  

    LOL Rustle.  

    VIX 12.42. 

    Fiber/StJ – Still waiting and waiting and waiting…

    VIX/Jbur – Obtuse is the way they take your money! 

    Bounces/Scott – True but they have to hold.  Rejected at strong bounce lines is a very bad sign.  


  129. FUEL for thought

    Although fuel costs for cars could drive more to electrics fuel is at the top affordable to prevent people from freezing to death now at home.


  130. And many are getting heating assistance now, just another big energy subsidy.


  131. GTAT/Phil:  About that Income Portfolio GTAT play,  we actually already have a 2000 share Buy-write play from September 10 and we rolled the $12 puts: http://www.philstockworld.com/2014/09/10/which-way-wednesday-how-low-can-we-go/#comment-4672361

    In the Income Portfolio, let's sell 20 of those 2016 $15 puts for $5.20 and sell 20 of the 2016 $12 calls for $4.15 and buy 2,000 shares of the stock for $13.05 for net $3.70/9.35.  So we're committing to own 4,000 shares of GTAT at net $9.35 ($37,400), which means our max margin (non-PM) would be $18,700 and our potential profit if called away at $12 (and over $15 too) is 2,000 x $8.30 = $16,600 so this trade returns 89% on POTENTIAL margin while the actual margin is only about $11K.  


  132. Phil // Flies
    Thanks.


  133. YHOO/Yodi – You run the risk of getting burned if there's any particularly good news and YHOO pops.  The spread makes 100%, why mess around?   If you REALLY want to take a risk (and it is nice premium), just keep in mind the IPO is the 29th, so you get to do it just into next week and, if they jump up, you are better off taking a $1 loss on the short calls than trying to ride them out as you have nowhere safe to roll to.  

    Good summary, Angel! 

    GOGO/Yodi – T has said they are going to build "something" to work with airlines – very Musky.  That scared a lot of people out of GOGO this Q but, for the year, they just IPO'd, so big cash came in.  

    $4Tn/Pharm – Money well spent!  That monetary base is terrifying, 4x more money sloshing around than just 6 years ago and Yellen thinks inflation will stay contained forever and ever?  How are these people economists?  

    DXD/Craigs – I would put off decision until this week is digested.  If we're going to get a drop (that didn't happen today) it won't likely be until next week.  Then we have to decide if we still have the same fear level into Jan or if we will lighten up on protection into the Santa Rally season.

    Financials/Albo – Rates will rise by June.  3 more Qs to play and then punch bowl goes.  At what point do people start heading for the exits is the question.  Banks are actually very poorly positioned as they have been addicted to short-term borrowing at 0% against long-term loans at 3-4%.  If rates go up to 1%, loan margins drop 25% for the banks.  Not pretty and not priced in.

    You're welcome DM.  

    EMN/Scott – Good one, they should benefit from low oil prices.  

    Butterflies/Palotay – Yes, I'm for leaving both open because, at the time I was writing, I thought we were too high and will pull back into Friday.  We pulled back a bit into the close already, we'll have to see how tomorrow goes.  As long as you have the margin for it, your are generally just risking nickels and dimes getting away from you unless you are so unlucky that your stock makes a violent move against you in the next 48 hours.  

    TSLA/StJ – Another thing where we have no idea what's real and what's not.  I'm certainly not inclined to believe that he has magical ways to cut his current $35,000 batteries below $20K and, even if he does, then he would have to build the rest of the car for $15K.  

    TSLA/Shadow – Right, it's not like every other car company in the World is stupid and can't figure out how to make a car like Musk.  Munger nailed it on that guy, he's so smart, he's an idiot.  

    GTAT/Income Portfolio, Kinki – Damn, I missed that.  I guess I never logged it in – it certainly would have filled by now.  The first play will stand as it's bigger but I like both.

    You're welcome Wombat, hope that was all clear.  


  134. One of the drawbacks, as far as I'm concerned with an Apple watch, is that it has to be charged every night.  Not a problem with the IPad because of its larger size.  I have a Garmin GPS watch for golf and having to charge it between rounds is a nuisance.


  135. Final tally:

    • Dow 16,980 (weak) and 17,010 (strong) 
    • S&P 1,985 (weak) and 1,990 (strong) 
    • Nasdaq 4,560 (weak) and 4,570 (strong) 
    • NYSE 10,950 (weak) and 11,000 (strong) 
    • Russell 1,160 (weak) and 1,170 (strong)

    So the only change from this morning is Nasdaq weak bounce line is no longer red – but not good enough to go green yet, either (Nas at 4,562).  And what did we say this morning? 

    In order for us to get bullish again, we want to see NO weak bounces and 4 of 5 of the strong bounce lines taken back.  The Nasdaq is at 4,553 and the NYSE is at 10,980 so, if they can cross their next goals, we'll be happy to go long on the Russell at 1,145 (/TF) and we can also play that with TNA (ultra-long Russell), where the weekly $71.50s have very little premium at $1.80 - considering that TNA ($72.42) popped 0.60 yesterday with the Russell up just 0.4%.  A 1% move up in the Russell should be a 50% gain on those calls!  

    Those TNA's opened at $2.13 and hit $2.90 on the morning run and $2.80 again at 2pm – not bad, but it was more fun playing the Futures!  

    iWatch/Albo – Hopefully they'll have a wireless charger but, if they did, you would think they would have announced it.  Certainly people don't want a port on their watch.   Won't be an issue for me, I have no desire to own one until it's independent.  


  136. iWatch / Phil – Wireless seems to be in…

    http://gizmodo.com/whoa-the-iwatch-has-wireless-charging-1632432368

    One interesting tidbit about the new Apple Watch is that it comes with wireless charging. That's pretty awesome on it's own, and notable for the fact that it's a technology that hasn't quite be sorted out quite yet.

    The watch requires no alignment or exposed contacts—it uses a combination of magsafe tech with inductive charging to connect. And the whoa is not because it's new tech; it's not. It's just a field that's not quite as refined as what Apple tends to adopt; wireless charging is still fairly inefficient, and there are a few different competing standards.


  137. Thanks StJ – that makes sense.  See, I do think like Apple!  

    This is for Shadow:


  138. Chronic Pain – according to Dr. Sarno, faith* can set you free…

    http://www.menshealth.com/health/chronic-back-pain?fullpage=true

    * faith in the diagnosis..

     


  139. iWatch / albo – Obviously a work in progress. The Moto 360 has wireless charging I believe so no a breakthrough technology anyway. In any case, no iWatch for me!


  140. The Fed is to this market like sugar to a 5 year old and Red Bull to a teenager…

    We are still holding vigil at the Russell waiting for that Death Cross. Actually, given a couple of good days, the Russell could rise from the dead and the cross could be averted. For now… But eventually as quoted in Kingdom of Heaven – "All death is certain".


  141. But as I posted before, these death cross signals are dubious technical signals anyway:

    http://stockcharts.com/articles/dont_ignore_this_chart/2014/09/would-a-russell-2000-death-cross-really-be-bad-.html

    They just as well could signal a mini correction or a pause. We shall see.



  142. LOL Wombat!


  143. Will silver bounce? I hope so…

    http://stockcharts.com/articles/dont_ignore_this_chart/2014/09/silver-sits-on-important-support-.html

    Strong dollar not helping of course!


  144. Phil – if I were to start the butterfly portfolio now, what long strikes would you suggest? Thanks.


  145. Phil,

    Re GOGO, I understand why the rumor of T entering the in-flight internet space would cause GOGO to sell off. Wouldn't the reality of T moving into that space to capture a part of a growing and profitable market pose a significant risk for GOGO, given the fact that T is the 800 lb gorilla (albeit not a very efficient one) with overwhelming heft and dramatically greater resources? Why wouldn't T enter this market segment?

    Just trying to consider a worst case scenario. I really like the GOGO position (and the inflight sector) but having trouble seeing how GOGO could compete with T. Thanks for your thoughts


  146. From Bloomberg, Sep 18, 2014, 4:14:31 AM

    European stocks advanced, as Bayer
    AG rallied on plans to spin off its plastics unit, while
    Scotland prepares to vote on independence. U.S. stock-index
    futures were little changed and Asian shares fell.

    To read the entire article, go to http://bloom.bg/1mh0SP6

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


  147. From Bloomberg, Sep 17, 2014, 7:01:01 PM


    Sept. 15 (Bloomberg) — Goldman Sachs Group Inc. Chief European Economist Huw Pill says investors will be disappointed if banks don’t take up at least 100 billion euros ($129 billion) when the European Central Bank allots first funds this week under its so-called targeted longer-term refinancing operations. He speaks on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Mario Draghi’s trillion-euro
    journey is under way.

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

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


  148. From Bloomberg, Sep 18, 2014, 12:00:01 AM


    Sept. 18 (Bloomberg) — The Federal Reserve needs a “critical mass” of strong U.S. economic data before it moves toward raising interest rates, according to Thanos Vamvakidis, head of Group of 10 currency strategy at Bank of America Merrill Lynch.
    He speaks with Jonathan Ferro and Caroline Hyde on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Federal Reserve policy makers signaled they won’t be raising interest rates anytime soon while suggesting they would tighten credit at a faster pace once the liftoff has begun.

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

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  149. From Bloomberg, Sep 18, 2014, 4:13:52 AM


    Anti-independence Better Together campaigners hold placards reading “Protect Jobs Vote No” during a demonstration in Edinburgh, U.K., on Sept. 16, 2014. Photographer: Simon Dawson/Bloomberg

    The U.K. (UKGRABIQ) economy is ready for battle.

    To read the entire article, go to http://bloom.bg/1ua9DsZ

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  150. From Bloomberg, Sep 18, 2014, 4:45:27 AM

    The components of a red Swiss Army knife stand on display in the store in Ibach, Switzerland. The Swiss economy will probably expand 1.8 percent in 2014, according to the median projection of economists surveyed by Bloomberg News. Photographer: Philipp Schmidli/Bloomberg

    Investors put off by slowing growth
    and lackluster yields in Europe are finding havens in companies
    that sell cancer drugs and baby food.

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

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  151. From Bloomberg, Sep 18, 2014, 12:01:00 AM

    The U.S. health-care system was
    among the least efficient in the developed world two years
    before major changes from Obamacare began to go into effect.

    To read the entire article, go to http://bloom.bg/1ubfy11

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  152. From Bloomberg, Sep 18, 2014, 4:28:01 AM


    Sept. 18 (Bloomberg) — Frank Newman, chairman of Promontory Financial Group China Ltd. and former chairman of Shenzhen Development Bank Co., talks about the nation’s banking industry and real estate market.
    Chinese banks rallied yesterday in Hong Kong trading as Sina.com said the central bank is providing the biggest lenders with 500 billion yuan ($81 billion) of financing to bolster loan growth and shore up the economy. Newman speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    China’s new-home prices fell in all
    but two cities monitored by the government last month as tight
    credit damped demand even as local home-purchase restrictions
    were eased.

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

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  153. From Bloomberg, Sep 18, 2014, 4:39:23 AM


    Sept. 16 (Bloomberg) — Eric Stein, a portfolio manager at Eaton Vance Corp. in Boston, talks about currencies and central banks’ policies.
    He also talks about China’s economy. He speaks in Hong Kong with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    European stocks rose, led by
    chemical makers, and Norway’s krone rallied with Switzerland’s
    franc following central bank policy decisions. Asian currencies
    fell with commodities after the Federal Reserve raised estimates
    for interest rates and Chinese home prices fell.

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

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  154. From Bloomberg, Sep 18, 2014, 3:53:22 AM


    Russian billionaire Vladimir Evtushenkov was charged with money-laundering and placed under house arrest two days ago. Photographer: Andrey Rudakov/Bloomberg

    The arrest of one of Russia’s
    oldest billionaires is sending shivers down the backs of
    business owners already reeling from U.S. and European sanctions
    over President Vladimir Putin’s policies in Ukraine.

    To read the entire article, go to http://bloom.bg/1u9nXSP

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  155. From Bloomberg, Sep 18, 2014, 12:01:00 AM


    The new health-tracking software will be a major feature of the Apple Watch when it goes on sale sometime next year. Photographer: David Paul Morris/Bloomberg

    Apple Inc. (AAPL) said it’s delaying the
    release of new health-tracking software that it has trumpeted as
    one of the main features of its new operating system for the
    iPhone and iPad.

    To read the entire article, go to http://bloom.bg/1uI0fPO

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  156. From Bloomberg, Sep 17, 2014, 7:12:04 PM


    An employee counts a stack of U.S. one hundred dollar bills inside a currency exchange center in Mexico City, Mexico. Photographer: Susana Gonzalez/Bloomberg

    Imagine a trillion-dollar market that runs on faxes and phone calls while routinely tying up investors’ money for months before they get any return.

    To read the entire article, go to http://bloom.bg/1uIk21F

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  157. From Bloomberg, Sep 18, 2014, 2:49:14 AM


    A voter wears pro-independence “yes” badges and a tartan scarf as she waits outside a polling station before casting her Scottish independence referendum vote in Edinburgh, on Sept. 18, 2014. Photographer: Chris Ratcliffe/Bloomberg

    Voters in Scotland are deciding whether to seek independence from the U.K. in a ballot that could spell the end of a three-century-old union that once dominated the world from America to Australia and trigger a new era of self-determination across Europe.

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

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  158. From Bloomberg, Sep 17, 2014, 7:00:01 PM

    An “I love Scotland” sign hangs beneath flags, including from left, the national flag of Brasil, the Union flag, the Royal Standard of Scotland, and the St. Andrew’s or Saltire flag, the national flag of Scotland, outside a souvenir store in Edinburgh, U.K. Photographer: Simon Dawson/Bloomberg

    Scots are set to vote today in a referendum on whether to leave the United Kingdom, with the first results expected early tomorrow morning.

    To read the entire article, go to http://bloom.bg/1ua9u8V

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  159. Watch this video at http://bloom.bg/1u1UjT8

    Five Ways iOS8 Will Change How You Use Your iPhone

    Sept. 17 (Bloomberg) –- Apple’s latest iOS update is here. While last year’s iOS 7 was mostly a design change, this operating system is all about function. Sam Grobart reveals the five biggest changes that will change the way you use your iPhone. (Source: Bloomberg)

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  160. Watch this video at http://bloom.bg/1u1uUc5

    Yellen: Labor Market Conditions Are Improving

    Sept. 17 (Bloomberg) — Fed Chair Janet Yellen comments on the U.S. labor market during a news conference in Washington. (Source: Bloomberg)

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  161. Watch this video at http://bloom.bg/1u0UhLi

    iPhone 6 Is a Killer Phone, New Era for Apple: Topolsky

    Sept. 17 (Bloomberg) — Bloomberg’s Joshua Topolsky reviews the iPhone 6 on “In The Loop.” (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


  162. From Bloomberg, Sep 18, 2014, 4:16:56 AM


    Thomas Jordan, president of the Swiss National Bank. Photographer: Philipp Schmidli/Bloomberg

    The Swiss National Bank threatened
    to step up its defense of the franc “immediately” if needed as
    it noted an increased danger of deflation.

    To read the entire article, go to http://bloom.bg/1yib3Ir

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  163. From Bloomberg, Sep 18, 2014, 4:34:55 AM

    U.K. retail sales rose the most in
    four months in August, helped in part by a surge in demand for
    vacuum cleaners before new restrictions on powerful electrical
    appliances came into effect.

    To read the entire article, go to http://bloom.bg/1uVNGP7

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  164. From Bloomberg, Sep 18, 2014, 3:55:05 AM

    Growing up in Scandinavia’s richest
    nation
    has its perks.

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

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  165. From Bloomberg, Sep 18, 2014, 1:44:03 AM

    Narendra Modi, India’s prime minister, right, and Xi Jinping, China’s president, wave as they arrive for delegation talks at Hyderabad House in New Delhi, India, on Sept. 18, 2014. Photographer Graham Crouch/Bloomberg

    Indian Prime Minister Narendra Modi
    will seek to boost ties with China today as he hosts President
    Xi Jinping while a fresh dispute simmers along their mountainous
    border.

    To read the entire article, go to http://bloom.bg/1u8Xg0y

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  166. From Bloomberg, Sep 17, 2014, 11:49:21 PM


    Zhou Xiaochuan, governor of the People’s Bank of China. Photographer: Chris Ratcliffe/Bloomberg

    China’s central-bank Governor Zhou Xiaochuan will miss his March 2016 goal for scrapping deposit-rate caps as a weak economy impedes policy makers, analysts at
    firms including Barclays Plc and Societe Generale SA said.

    To read the entire article, go to http://bloom.bg/1uIi0yD

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  167. From Bloomberg, Sep 18, 2014, 4:41:10 AM

    Russia’s central bank is looking to
    buttress its financial system against sanctions over the Ukraine
    conflict without returning to the capital controls it abandoned
    eight years ago, the bank’s first deputy chairman said.

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

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  168. From Bloomberg, Sep 17, 2014, 12:16:23 PM


    Employees work at Alibaba.com Ltd.’s headquarters in Hangzhou, Zhejiang Province, China. Photographer: Nelson Ching/Bloomberg

    The clock won’t be ticking on Alibaba Group Holding Ltd. as market makers work to arrange its first trade on the New York Stock Exchange.

    To read the entire article, go to http://bloom.bg/1u8pdpa

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  169. From Bloomberg, Sep 18, 2014, 12:00:01 AM

    A software developer is selling a private island off Pohnpei in Micronesia for $599,000, or 1,030 bitcoins. Photographer: Michael Runkel/Getty Images

    An island in Micronesia. A gold
    mine in Canada’s Yukon Territory. Tickets to the 2014 Victoria’s
    Secret fashion show in London. Those are just a few of the
    assets on offer at BitPremier, a website targeting bitcoin
    holders looking to unload some of their digital hoard.

    To read the entire article, go to http://bloom.bg/1ubecn9

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  170. From Bloomberg, Sep 17, 2014, 12:00:01 AM


    Trays of ground beef are wrapped in the meat department of a supermarket in Princeton, Illinois, U.S. The USDA on Sept. 11 lowered its forecasts for beef production for both this year and next. Photographer: Daniel Acker/Bloomberg

    As bulging supplies of commodities
    such as corn and sugar drive most raw materials lower, cattle
    futures are providing a haven for commodity investors.

    To read the entire article, go to http://bloom.bg/1BKXL5D

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  171. From Bloomberg, Sep 18, 2014, 12:24:57 AM


    Sept. 18 (Bloomberg) — Takuji Okubo, chief economist at Japan Macro Advisors in Tokyo, talks about the nation’s economy, government and central bank policies.
    Japan’s exports declined less than forecast in August, providing support for Prime Minister Shinzo Abe as he weighs whether the economy can bear another increase in the sales tax. Okubo speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Japan’s exports declined less than forecast while a drop in imports (JNTBIMPY) underscored the challenge to Prime Minister Shinzo Abe in stoking domestic demand.

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

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  172. From Bloomberg, Sep 17, 2014, 11:07:17 PM


    As economists debate whether China can meet this year’s gross domestic product growth goal of 7.5 percent, would it be better to ditch targeting altogether? Photographer: Brent Lewin/Bloomberg

    As economists debate whether China can meet this year’s gross domestic product growth goal of 7.5 percent, would it be better to ditch targeting altogether?

    To read the entire article, go to http://bloom.bg/1ub39tX

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  173. From Bloomberg, Sep 17, 2014, 10:15:20 PM


    John Key, New Zealand’s Prime Minister, is forecasting the first budget surplus in seven years in the 12 months through June 2015. Photographer: SeongJoon Cho/Bloomberg

    New Zealand’s economy grew at the
    fastest pace in 10 years in the second quarter, outperforming
    most major developed markets as the country prepares to hold an
    election this weekend.

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

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  174. From Bloomberg, Sep 18, 2014, 3:40:20 AM


    Sept. 10 (Bloomberg) — International Monetary Fund Deputy Managing Director Zhu Min talks about China’s economy.
    He speaks on the sidelines of the World Economic Forum’s “New Champions” meeting in Tianjin, China, with Stephen Engle on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    China’s growth trajectory is still pointing down, even after an $81 billion liquidity injection.

    To read the entire article, go to http://bloom.bg/1u8hA1Q

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  175. From Bloomberg, Sep 17, 2014, 9:30:30 PM


    South Korea risks following Japan’s so-called “lost twenty years” unless it gets more aggressive in boosting growth, according to Choi Kyung Hwan, South Korea’s Finance Minister. Photographer: SeongJoon Cho/Bloomberg

    South Korea plans to spend a record
    376 trillion won ($363 billion) next year and delay reaching a
    surplus by at least 2 years as the government increases support
    for a slowing economy.

    To read the entire article, go to http://bloom.bg/1wFifg6

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  176. From Bloomberg, Sep 18, 2014, 5:40:55 AM

    Where have all the scrap peddlers gone?

    Over the weekend, for the second time in as many years, thousands of demonstrators took to the streets in China’s southern Bolou County to oppose the construction of a proposed trash incinerator in their area. The protest was ironic, given that such facilities are needed precisely because ordinary Chinese like them are producing too much garbage for landfills to handle. At the same time, the demonstrators have reason to be concerned: The fumes coming out of any new incinerator are likely to be more toxic than ever before.

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

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  177. From Bloomberg, Sep 17, 2014, 4:01:47 PM


    General Martin Dempsey’s job is tactics.

    U.S. forces in Iraq “do not and will not have a combat mission,” President Barack Obama said today, repeating what he said a few days ago, and a few days before that. Which would be unremarkable except for Army General Martin Dempsey’s comments to senators yesterday that U.S. advisers would “accompany Iraqi troops on attacks” if necessary.

    To read the entire article, go to http://bv.ms/1mbG6Rb

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  178. From Bloomberg, Sep 17, 2014, 12:01:00 AM


    Eric Schneiderman, Attorney General of New York. Photographer: Louis Lanzano/Bloomberg

    Whether they like it or not, banks are opening up their dark pools, the private venues that host 17 percent of trading in the $24 trillion U.S. stock market.

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

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  179. From Bloomberg, Sep 17, 2014, 2:49:35 PM


    Try building it today.

    Peter Thiel comes bearing dark portents for our civilization. The PayPal co-founder and venture capitalist is an outspoken iconoclast, regarded by some as brilliant and by others as crazy. In recent years, Thiel has joined the chorus of voices warning that technological progress has stagnated, adding his voice to those of Robert Gordon and Tyler Cowen, but also Neal Stephenson and Paul Krugman. When you find such a diverse group of smart people sounding the same alarm, it’s worth paying attention.

    To read the entire article, go to http://bv.ms/1s6URXU

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  180. From Bloomberg, Sep 17, 2014, 12:20:25 PM

    Torsten Slok, chief international economist for Deutsche Bank AG, warns about the hawks on the Federal Open Market Committee getting too, well, hawkish.

    To read the entire article, go to http://bv.ms/1tfx6eD

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  181. Futures pumped back up to yesterday's highs at 17,125, 2,001.50, 4,080 and 1,156.5 so I like shorting below 17,100, 2,000, 4,075 and 1,155 – short the laggard, out of any of them cross back over – very simple!  

    Oil with a big Wheeeee!  to $93.75 again overnight on the short, now back to $94.35 but going down IMHO.  That should put those SCO $30s in the money too.  

     

    Good morning!  

    Just ditched those oil shorts about even at $94.66 (up 0.09) after leaving them overnight.  Best was $94.45  but moving up now.  /ES shorts sill on at 1,991.32 avg entry and about even and I'm still hoping for 1,980.  

    The API Report was certainly not encouraging but we're still up on the OPEC BS – the meeting isn't until November – this is utter nonsense and I'm still into shorting but not over $94.75 unless it's $94.95, at which point I'm short again until $95 breaks and then I would just wait for inventories to see what's up.

    I don't post these to brag but to show you how we make these trades and how they work out (or don't).  This isn't that hard – we saw the API report (much detail in that full comment) and that gave us a premise of weakness and our long-term observation of oil led us to believe $95 would probably be the top of the channel and we expected to re-test our lower channel at $92.50.

    So this morning, we have a drop from $95 to $93.50 and that's $1.50 so a weak bounce is 0.30 to $93.80 and a strong bounce is another 0.30 to $94.10, which are currently the spike highs.  Since there's no news on oil this morning I don't expect $94.50 to hold and it makes sense to short here with tight stops over the line in hopes we'll get another $1 drop back to $93.50  but, of course, there will be support at $94 as well, so tight stops at $94 and we can always re-enter below $94 with tight stops above. 

    Wash, rinse, repeat…


  182. Phil,

    When you have a moment (dropped post from late yes'd that didn't make it through)…

    Re GOGO, I understand why the rumor of T entering the in-flight internet space would cause GOGO to sell off. Wouldn't the reality of T moving into that space to capture a part of a growing and profitable market pose a significant risk for GOGO, given the fact that T is the 800 lb gorilla (albeit not a very efficient one) with overwhelming heft and dramatically greater resources? Why wouldn't T enter this market segment?

    Just trying to consider a worst case scenario. I really like the GOGO position (and the inflight sector) but having trouble seeing how GOGO could compete with T and/or esp VZ. Thanks for your thoughts


  183. Phil

    The 92.50 is the Nov /clx4 contract they rolled last night due to oct CLV4 options expiration yesterday


  184. 1.10 spread between clv4 and clx4 contracts right now


  185. Dollar spiked up to 84.9 last night before calming down.  Interesting as it topped out at 1am, when the ECB announced their own $90Bn stimulus (matching China) and then, as the Dollar started falling back (84.65 now), the markets began to rise.  This is silly, of course, because the markets didn't go down when the Dollar went up but now they are going up when the Dollar goes down.  It's all some sort of trick of the light for EU traders, I imagine.  

    Pre-market, they would wake up to a strong Dollar and all of our stocks would LOOK like they jammed much higher (in Euros) yesterday.   So they start buying and then the Dollar goes down and their Euro purchases of stocks begin to look like they are doing fantastically and that leads to more buying excitement.  It's like a magic trick where the Europeans can't see what's going on behind the curtain.  

    With the Yen at 108.67, the Nikkei shot up to 16,150, now 16,135 and I like them short but out over 16,150, of course.   Officially the Nikkei was up 1.13% today but the Hang Seng fell 0.85%, Shanghai up 0.35% but India was happy about the meeting with China and popped 1.8%.   There was also MORE stimulus from China and, as I've said, I think they are covering up a financial crisis in progress at this point.  

    China's central bank made a second surprise move this week to ease monetary policy with a cut in short-term borrowing costs for banks.

    Europe is up about half a point with Germany strongest, up almost 1% but all topping out into lunch.   Of course we have the Scotland vote today but no results (officially) until 2pm tomorrow.  It seems to me that, since the Government in power is counting the votes and since the referendum to succeed is coming from agitators – that the count will not go in favor the of the agitators.  The ballot has one question: "Should Scotland be an independent country?"  They expect 90% of the people to vote (over 16 are eligible). 

    Is This the Scots' Day to Break Away?

    Voters in Scotland began casting their ballots in a historic referendum on whether to go it alone as an independent country or remain part of the U.K. 5:40 AM

    AliBaba's IPO is tomorrow and a strong showing by them will likely boost the Chinese markets as they all hope to repeat that performance.  

    So plenty of reasons to remain cautious into the weekend.  Don't forget, I will only be here in the early morning tomorrow so my caution is partially based on that as well.  


  186. Butterfly ideas/Nicha – Remind me in chat and we can look some over.  

    GOGO/8800 – As I said, they have 80% of US flights under contract through 2020 so, even if T does come up with something better (they have nothing now, just talk) and convinces carriers to switch in droves – it will be a long time before it hurts GOGO.  Also, while I can get on a plane and not have wifi – my kids consider it torture and, for now, they don't make that decision so they suffer but, as those kids get older – I think there will be more and more GOGO customers every year.  Even I do it once in a while – when I have a business reason.  Apparently though, 1/3 of the people on the plane are already doing it and, if I were the airline (who get a cut), I'd start making it an add-on choice people can make with their tickets.  

    Don't forget, T also said we'd have video phones 20 years ago and they said we'd all have high-speed fiber and they said we'd have better cell-phone reception and they said they'd lower the bills if we stop net neutrality, etc. etc….

    2014-06-13-attpromise.png

    $92.50/Bert – Yes, I fixed those numbers but you may need to refresh the page.  


  187. Phil,

    Thanks for the expanded perspective on GOGO. 


  188. Butterflies / Phil … is this strategy covered in the education archives? Just wondering how do you select the strike prices for the short term calls and puts each month? I have the WMT play.Thanks