Archive for January, 2015

Caught On Tape: Dijsselbloem To Varoufakis: “You Just Killed The Troika”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Amid 'turmoiling' stock markets on Friday, CNBC's Simon Hobbs summed up the status quo's thinking on the new Greek leadership when he noted, somewhat angrily and shocked, "The Greeks are not even trying to reassure the markets," seeming to have entirely forgotten (and who can blame him in this new normal the world has been force-fed for 6 years) that political leaders are elected for the good of the people (by the people) not for the markets. Yesterday saw the clearest example yet of Europe's anger that the Greeks may choose their own path as opposed to following the EU's non-sovereign leadership's demands when the most uncomfortable moment ever caught on tape – the moment when Eurogroup chief Jeroen Dijsselbloem (he of the "template" foot in mouth disease) stood up at the end of the EU-Greece press conference, awkwardly shook hands with Greece's new finance minister, and whispered…"you have just killed the Troika," to which Varoufakis responded… "wow!"

As Keep Talking Greece reports,

The joint press conference was concluding, when Greek Finance Minister Yanis Varoufakis droped a last bombshell.  “…and with this if you want – and according to European Parliament – flimsily-constructed committee we have no aim to cooperate. Thank you.” Varoufakis was referring to the famous Troika, the country’s official creditors consisting of the European Union, the International Monetary Fund and the European Central Bank..

After concluding with a “Thank you” Varoufakis gives the word to Eurogroup Chief Jeroen Dijsselbloem, who wants to hear the translation first. Then he takes off the ear phones, he stands up and sets to leave. An enforced-looking shaking of hands delays the  departure of the Dutch FinMin.

Dijsselbloem quickly whispers something to Varoufakis’ ear, he briefly replies back and the Eurogroup chief leaves the press conference hall as soon as it was possible.

Video: the Awkward Greek-Eurogroup Moment

The whole afternoon, Greek and international media were trying to find out “What the hell did they two men said to each other!?”

Private Mega TV reported short before 9 pm on Friday.

Eurogroup chief whispered to Greek FinMin’s  ear “You just killed the Troika” and that Varoufakis replied with a simple “WOW!”

Dijsselbloem: Whisper…whisper…

Varoufakis: Whisper….

Dijsselbloom slides his hand away

Back remains Varoufakis with one palm open and the left…
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Cowen Analyst Likes Intercept Pharmaceuticals, ACADIA Pharmaceuticals And Raptor Pharmaceutical

Courtesy of Benzinga.

Related ICPT
Mid-Afternoon Market Update: Crude Oil Jumps 7.5%; Visa Shares Climb On Earnings Beat
Intercept Pharmaceuticals Soars 20%, Possible Short Squeeze
Intercept Pharmaceuticals' OCA Now Breakthrough Therapy – Analyst Blog (Zacks)

Related ACAD
Biotechs Presenting At The J.P. Morgan Healthcare Conference: Day 2
Benzinga's Top Initiations
Qiagen (QGEN) Disappoints with Q4 Earnings, Revenue Miss – Analyst Blog (Zacks)

Speaking on CNBC’s Fast Money, Ritu Baral of Cowen and Company said that Intercept Pharmaceuticals Inc (NASDAQ: ICPT) is a buy. The company has received a breakthrough status by the FDA and it is about to start a phase 3 in the NASH program, said Baral. She added that we are going to see a filing for a lead program that has a potential to get approved by the FDA at the end of 2015 or early 2016.

She likes ACADIA Pharmaceuticals Inc. (NASDAQ: ACAD) because of Parkinson’s psychosis treatment, which has a billion plus market. It has a breakthrough status by the FDA and the company has been a topic in numerous acquisition discussions.

Baral is bullish on Raptor Pharmaceutical Corp. (NASDAQ: RPTP). The stock has been struggling recently because of the weak Q4, but Baral thinks that the catalyst for this stock will come in May when the data of pediatric NASH program gets released.

Latest Ratings for ICPT

Date Firm Action From To
Jan 2015 Deutsche Bank Maintains Buy
Dec 2014 Citigroup Maintains Buy
Dec 2014 Bank of America Reinstates Buy

View More Analyst Ratings for ICPT
View the Latest Analyst Ratings

Posted-In: Cowen and Company Ritu BaralAnalyst Color CNBC Analyst Ratings Media





The German 10 Year Bund Effectively a Call Option at 30 Basis Points

Courtesy of EconMatters

Bonds are not Stocks

On Friday the German 10 Year Bund yield touched the 0.30 mark or 30 basis points, yeah that`s right the same instrument that was yielding 90 basis points in November of last year, a 140 basis points last May 2014, and 195 basis points at the beginning of 2014. It has gotten so ridiculous in the bond markets that I think investors have forgotten what bonds actually are as an asset class, they trade based on price appreciation like stocks, and this perverted mentality has completely ignored the risk component of what bonds represent as debt obligations.   

German Core CPI expected to be 1.1% in 2015

But the case of the German 10 year Bund has gotten so idiotic that all finance logic has been thrown out the window. Excluding food and energy, consumer prices are expected to increase by 1.1 percent year on year in Germany for 2015. Yes energy has dropped 50% and so the comps are skewing everyone`s inflation readings to the downside, this is the rationale for focusing on the core inflation readings historically because of the high volatility of these two categories. Once the bad year over year comps start coming out of the energy components all the inflation readings will start spiking up again late next year, but remember the German Bund yielding 30 basis points is for the duration of 10 years, not 3 months!


Bund Yields in the Financial Crisis

There is talk about slow growth in Europe responsible for these low yields, but during the financial crisis of 2008/2009 the German 10 year yield was between 3% and 4%, and this was a time of the global recession where oil was trading as low as $33 a barrel, things were much worse during the financial crisis compared to today.

ZIRP is the Elephant in the Room

The real reason the German 10 year yield has dropped so dramatically is the abundance of cheap money in the financial system, all the big financial institutions are basically borrowing at ZIRP levels from government central banks, levering up their balance sheets, and taking


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Socialist Exceptionalism

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

“In the minds of the statists, “Government Works Better” and ‘things’ work at the surface; but at the core, it’s a disaster… The Americans that look to the government to ‘save’ them – and even gleefully thank the government for helping bail them out – fail to realize that it was the government that f##ked them in the first place…”

Simply put, “debt-financed socialism and corporatism isn’t working” and a day of reckoning is coming…





How Ukraine Can Save China From Its Existential Threat (Spoiler Alert: Girls)

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

In China last year, just over 115 boys were born for every 100 girls, and since sonogram technology was introduced to China in the 1980s – allowing families to determine a baby’s gender during the first few months of pregnancy – the gender imbalance in the world's largest economy has grown colossal. However, as Beijing News recently explained, there may be a solution for China's 34 million woman shortfall… Ukrainian women, as "their economy is depressed but beautiful women are running rampant." While Foreign Policy notes that the best destinations for Chinese men to find spouses are Japan and South Korea, there appears to be plenty of fish in the sea, at least outside China. Oh the wonders of Ricardian comparative advantage – Ukraine needs an export business (and produces – from what we have heard – attractive women) and China needs to import 'women' (to fill its massive shortfall). Global economic growth problems, solved…

As Foreign Policy reports,

"Their economy is depressed but beautiful women are running rampant,” the state-run Beijing News reported Jan. 22 in a story suggesting that Ukrainian women could be the solution to China’s woman shortage. The piece, illustrated with charts, bubbles, and cartoon illustrations of lonely Chinese men, was a breezy attempt to make light of China’s missing women and the severe gender imbalance caused by couples aborting female fetuses in favor of boys. So widespread is the practice that it has badly skewed the country’s sex ratio: The global average is around 105 boys born for every 100 girls; but in China last year, just over 115 boys were born for every 100 girls.

The problem has been brewing since sonogram technology was introduced to China in the 1980s, allowing families to determine a baby’s gender during the first few months of pregnancy. Combined with the country’s restrictive family-planning policies — until recently, most urban families were only allowed a single child in order to curtail population growth — and a traditional preference for sons, the newfound ability to practice sex-selective abortion has resulted in one of the world’s highest gender imbalances. The topic flared anew in the public mind after the National Bureau of Statistics announced the latest population figures on Jan. 20, noting that at the end of 2014 China had 701 million men


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What Do They Know? Why Are So Many Of The Super Wealthy Preparing Bug Out Locations?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Michael Snyder via The End of The American Dream blog,

A lot of ultra-rich people are quietly preparing to “bug out” when the time comes.  They are buying survival properties, they are buying farms in far away countries and they are buying deep underground bunkers.  In fact, a prominent insider at the World Economic Forum in Davos, Switzerland says that “very powerful people are telling us they’re scared” and he shocked his audience when he revealed that he knows “hedge fund managers all over the world who are buying airstrips and farms in places like New Zealand”.

So what do they know?  Why are so many of the super wealthy suddenly preparing bug out locations?  When the elite of the world start preparing for doomsday, that is a very troubling sign.  And right now the elite appear to be quietly preparing for disaster like never before.

The insider that I mentioned above is named Robert Johnson.  He is the president of the Institute of New Economic Thinking, and what he recently told a packed audience in Davos is making headlines all over the planet

With growing inequality and the civil unrest from Ferguson and the Occupy protests fresh in people’s mind, the world’s super rich are already preparing for the consequences. At a packed session in Davos, former hedge fund director Robert Johnson revealed that worried hedge fund managers were already planning their escapes. “I know hedge fund managers all over the world who are buying airstrips and farms in places like New Zealand because they think they need a getaway,” he said.

But he didn’t stop there.

In a separate interview, Johnson admitted that “very powerful people are telling us they’re scared” and that the elite “see increasing evidence of social instability and violence”.  You can watch video of the entire interview below…

Wow.

And Johnson is not the only one saying these things.

The following quote comes from the Mirror

His comments were backed up by Stewart Wallis, executive director of the New Economics Foundation, who when asked about the comments told CNBC Africa: “Getaway cars the airstrips in New Zealand and all that sort of thing,


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16% Of Global Government Bonds Now Have A Negative Yield: Here Is Who’s Buying It

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

A week ago many were surprised to learn that in his attempt to “fight deflation”, the ECB’s Mario Draghi unleashed the biggest deflationary wave of all time, when in the aftermath of the ECB’s NIRP policy, and subsequently QE, an unprecedented €1.4 trillion in European debt with a maturity of more than 1 year traded down to subzero, as in negative, yields.

But what happens if one expands the Eurozone NIRP universe to include the debt of other countries including Japan, Denmark, Sweden, Switzerland and so on? Conveniently, JPM has done the analysis and finds that a mindblowing $3.6 trillion of government debt traded with a negative yield as recently as last week. This represents 16% of the JPM Global Government Bond Index, or in other words nearly a fifth of all global government debt is now trading with a negative yield, meaning investors pay sovereigns, using other people’s money of course, for the privilege of buying their issuance!

JPM’s full take:

There is currently €1.5tr or $1.7tr of Euro area government bonds of greater than one year maturity trading with negative nominal yields, almost all of them of core euro governments of up to 5 years maturity. This figure rises to $1.8tr if one adds $16bn of Swedish, $60bn of Swiss and $45bn of Danish government bonds currently trading with a negative yield. Almost all Japanese government bonds are trading with positive yields this week, but last week around $1.8tr of them were trading with a negative yield. So the total universe of government bonds traded with a negative yield was $3.6tr last week or 16% of the JPM Global Government Bond Index.

The logical follow up question: as the entire world appears slowly but surely headed to a uniform NIRP platform, where every single sovereign’s debt will have a negative yield thanks to one or more central banks’ guarantees that said debt will be monetized no matter what (those curious what happens when there is even a faint doubt if a given nation’s Treasurys won’t be backstopped and purchased by a central bank, just look at what happened to Greek bonds this past week), why do investors keep dumping their cash in securities that have a negative carry?

Here again courtesy of JPM’s Nikolaos Panigirtzoglou,…
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Diving Into the GDP Report – Some Ominous Trends – Yellen Yap – Decoupling or Not?

Courtesy of Mish.

Yellen Yap

On Thursday, Fed Chair Janet Yellen met with Senate Democrats at a private luncheon. She told the Democrats that the U.S. Economy is Strong.

My first thought was “what the heck is Yellen doing holding a private lunch with Democrats only?” Had she met with Senate Republicans, I would have asked the same question.

Apparently this is common procedure for Yellen, so perhaps I am reading too much into it.

Yet, I cannot help wondering if the real purpose of the meeting was to persuade Democrats to block any “Audit the Fed” Initiatives.

Glowing Report

Regardless of the reason, Yellen had some pretty glowing things to say.

“She went through the issues of unemployment and inflation. Very positive. And economic growth numbers were good, have been good. There’s work to be done,” Sen. Richard Durbin (D-Ill.) said after the luncheon.

No Rate Hike Soon

Bloomberg reported Yellen Tells Senators No Rate Rise Soon Amid Concerns Abroad.

“Her message is that the economy’s getting better but there’s still a ways to go in terms of job creation,” New York Senator Charles Schumer said today in an interview on Capitol Hill. “That worry seems, in her mind, to be paramount and that’s why she is not going to raise rates immediately.”

The Fed upgraded its assessment of the U.S. economy in a statement on Wednesday after a meeting of its policy-setting committee, while adding a reference to “international developments” which investors took as a sign of mounting worry about weakness overseas. …



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“King Dollar” Is Crushing ‘Recovery’Dreams, 87% Of US Companies Have Guided Lower

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The 'souring' of the mother's milk of stock markets continues. Management guidance and commentary implies 3-5pp impact due to 'king dollar' FX headwinds as an astounding 87% of companies guided below consensus expectations for next quarter. Bottom-up consensus 2015 EPS estimates were cut by 4% during January, and, as Goldman Sachs warns, 4Q EPS is tracking 7% below the consensus estimate at the start of reporting season. Finally, and perhaps most worrisome, granular bottom-up consensus is below top-down 'strategist' consensus for the first time since 2009… as the gap between Forward P/E valuations and long-term growth is as wide as it has ever been.

"King Dollar" is not 'unambiguously good' for America…

Revenue results are correlated to dollar strengthening, which has led to weaker revenue results and lower forward guidance that incorporates the FX headwind.

Anecdotally, management commentary implies the dollar strengthening will lower revenue growth by 300-500 bp. Foreign sales accounted for 33% of aggregate revenue for the S&P 500 in 2013.

Based on our earnings model, a 10% strengthening of the trade-weighted dollar lowers S&P 500 2015 EPS by about $3.

Bottom-up Consensus 2015 EPS is tumbling…

An astounding 87% of companies (39 of 45) guided below consensus expectations for next quarter, the highest level in our 34-quarter history. Historically, 71% of firms guide down in a typical quarter.

Full-year 2015 guidance also disappointed. 80% of firms guided earnings below consensus.

The median company guided 4% below consensus expectations for 1Q 2015 and 2% below consensus for full-year 2015.

Bottom-up consensus 2015 EPS estimates plummeted by 4% during January due to both falling oil prices and negative company guidance.

The $4.50 decline in EPS to $120.50 from $125 now places bottom-up consensus estimates below our forecast of $122 and the top-down consensus forecast of $125. Bottom-up consensus estimates were last below top-down estimates in 2009.

And finally – valuations…

Consensus long-term growth estimates are slumping… whch means multiple expansion is the only way to keep the dream of wealth creation alive. As @Not_Jim_Cramer exposes, this 'gap' has seldom – if ever – been wider…

*  *  *





It’s Greece vs. Wall Street

Courtesy of The Automatic Earth


DPC Grand Central Station and Hotel Manhattan, NY 1903

On the one hand, I’ve written so much about Greece lately I fear I’m reaching overkill. On the other hand, there’s so much going on with Greece, and so fast, that I wouldn’t know here to begin. Moreover, I’m thinking and trying to figure what is what and what is actually happening so much it’s hard to stay focused for more than a short while before something else happens again and it all starts all over. And I’m thinking it must feel that way for the Syriza guys as well.

One thing I do increasingly ponder is that it gets ever harder to see the eurozone survive. In its present shape and form, that is. Damned if you do, doomed if you don’t, is an expression I’ve used before. It’s like this big experiment that a bunch of power hungry Europeans really get off on, that now all of a sudden is confronted with the democracy they all only thought existed in books of history anymore.

But if you take your blind hunger far enough to kill people, or ‘only’ condemn them to lives of misery, they will eventually try to speak up, even if not nearly soon enough. It’s like a law of physics, or like Icarus in, yes, Greek mythology: try to reach too high, and you’ll find you can’t.

What is Brussels supposed to do now? Throw Athens off a cliff? Not respect the voice of the Greek people? That doesn’t really rhyme with the ideals of the union, does it? If they want to keep the euro going, they’re going to have to give in to a probably substantial part of what Syriza is looking for. Or Greece will leave the eurozone, and bust it wide open, exposing its failures, its lack of coherence, and especially its lack of democratic and moral values.

The problem with giving in, though, is that there are large protest demonstrations in Spain and Italy too. Give anything at all to Greece, and the EU won’t be able to avoid giving it to others as well. And by then you’re talking real money.

They called it upon themselves. They got too…
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Zero Hedge

Explosion Hits Russia's Largest Virus Lab Which Houses Plague, Smallpox, Ebola And Other Deadly Viruses

Courtesy of ZeroHedge View original post here.

A sudden explosion at a Siberian virus research center on Monday reportedly left the facility engulfed in flames, according to several Russian news outlets. 

Firefighters and other emergency personnel were dispatched to the "Vector Institute" located several miles from Novosibirsk - an emergency which was upgraded "from an ordinary emergency to a major incident," a...



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Phil's Favorites

The future of work will still include plenty of jobs

 

The future of work will still include plenty of jobs

Even though the future is unknown, Canada’s employment rate has risen steadily from 53 per cent in 1946 to more than 61 per cent today. (Shutterstock)

Courtesy of Wayne Simpson, University of Manitoba

There is now widespread anxiety over the future of work, often accompanied by calls for a basic income to protect those displaced by automation and other technological changes.

As a labour economis...



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Lee's Free Thinking

Is The Drone Strike a Black Swan?

Courtesy of Lee Adler

Pundits are calling yesterday’s drone strke a “black swan.” Can a drone strike on a Saudi oil facility, be a “black swan.”

According to Investopedia:

A black swan is an unpredictable event that is beyond what is normally expected of a situation and has potentially severe consequences. Black swan events are characterized by their extreme rarity, their severe impact, and the practice of explaining widespread failure to predict them as simple folly in hindsight.

I seriously doubt that no one expected or could have predicted a drone strike on a Saudi oil facility.

Call Me A B...

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Insider Scoop

New Relic Cuts 2020 Sales Guidance, Announces Changes In Management

Courtesy of Benzinga

New Relic (NYSE: NEWR) has reaffirmed its second-quarter guidance and cut its sales guidance for fiscal year 2020 from $600 million-$607 million to $586 million-$593 million.

The company’s chief technology officer, Jim Gochee, and chief revenue officer, Erica Schultz, have resigned. New Relic also named board member Michael Christenson as its chief operating officer. Christenson joins from his ...



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The Technical Traders

Metals are following downside sell off prediction before the next rally

Courtesy of Technical Traders

It is absolutely amazing how the precious metals markets have followed our October 2018 predictions almost like clockwork.  Our call for an April 21~24 momentum base below $1300 followed by an extensive rally to levels above $1550 has been playing out almost like we scripted these future price moves.

Now that the $1550 level has been reached, we are expecting a rotation to levels that may reach just below the $1490~1500 level before attempting to set up another momentum base/bottom formation.  And just like clockwork, Gold has followed our predictions and price is falling as we expected. Just look at our October 2018 chart where we forecasted the price of gold...



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Chart School

Crude Oil Cycle Bottom aligns with Saudi Oil Attack

Courtesy of Read the Ticker

Do the cycles know? Funny how cycle lows attract the need for higher prices, no matter what the news is!

These are the questions before markets on on Monday 16th Aug 2019:

1) A much higher oil price in quick time can not be tolerated by the consumer, as it gives birth to much higher inflation and a tax on the average Joe disposable income. This is recessionary pressure.

2) With (1) above the real issue will be the higher interest rate and US dollar effect on the SP500 near all time highs.

3) A moderately higher oil price is likely to be absorbed and be bullish as it creates income for struggling energy companies and the inflation shock may be muted. 

We shall see. 

...

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Kimble Charting Solutions

Bond Yields Due For Rally After Declining More Than 1987 Stock Crash

Courtesy of Chris Kimble

U.S. Treasury Bond Yields – 2, 5, 10, 30 Year Durations

The past year has seen treasury bond yields decline sharply, yet in an orderly fashion.

This has spurred recession concerns for much of 2019. Needless to say, it’s a confusing time for investors.

In today’s chart of the day, we look at a longer-term view of the 2, 5, 10, and 30-year treasury bond yields.

Short to long term bond yields are all testing 7 to 10-year support levels as momentum is at the lowest levels in a decade.

A yield rally is likely due across the board after a recent decline that was bigger than the stock crash in 1987!

If yields fail to ral...



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Digital Currencies

China Crypto Miners Wiped Out By Flood; Bitcoin Hash Rate Hits ATHs

Courtesy of ZeroHedge View original post here.

Last week, a devastating rainstorm in China's Sichuan province triggered mudslides, forcing local hydropower plants and cryptocurrency miners to halt operations, reported CoinDesk.

Torrential rains flooded some parts of Sichuan's mountainous Aba prefecture last Monday, with mudslides seen across 17 counties in the area, according to local government posts on Weibo. 

One of the worst-hit areas was Wenchuan county, ...



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Biotech

The Big Pharma Takeover of Medical Cannabis

Reminder: We are available to chat with Members, comments are found below each post.

 

The Big Pharma Takeover of Medical Cannabis

Courtesy of  , Visual Capitalist

The Big Pharma Takeover of Medical Cannabis

As evidence of cannabis’ many benefits mounts, so does the interest from the global pharmaceutical industry, known as Big Pharma. The entrance of such behemoths will radically transform the cannabis industry—once heavily stigmatized, it is now a potentially game-changing source of growth for countless co...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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