Archive for January, 2017

Is Warren Buffett A Closet Stoic?

By Guest Post. Originally published at ValueWalk.

Objective judgment, at this very moment.

Unselfish action, now at this very moment.

Willing acceptance – now at this very moment –of all external events.

That’s all you need

— Marcus Aurelius

Successful Investing is half art half science and, “What’s needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding that framework.” Warren Buffett. And Stoicism provides the tools needed to help you keep your emotions in check and prevent them from corroding the intellectual framework.

Warren Buffett

Image source: Video Screenshot
Warren Buffett

What is Stoicism?

New York Times bestselling author Ryan Holiday refers to it as; “A tool in the pursuit of self-mastery, perseverance, and wisdom: something one uses to live a great life, rather than some esoteric field of academic inquiry”.

The well-known Stoics, Marcus Aurelius, Seneca, and Epictetus, would focus on a series of questions: “How do I handle my anger” “Why am I afraid of death?” “How can I deal with the difficult situations I face?” “What is the best way to live?” “How should I handle the success and power I hold?”

In their writings and teachings, the Stoics struggled to answer these questions in a practical way.

They framed their work in three critical disciplines:

The Discipline of Perception: how you see and perceive the world around us.

The Discipline of Action: The decisions and actions we take – and to what end.

The Discipline of Will: How we deal with the things we cannot change, attain clear and convincing judgment, and come to a true understanding of our place in the world.

“By controlling our perceptions, the Stoics tell us, we can find mental clarity. In directing our actions properly and justly, we’ll be effective. In utilizing and aligning our will, we will find the wisdom and perspective to deal with anything the world puts before us.” – Ryan Holiday

Perception

In Robert G. Hagstrom’s excellent book, INVESTING: The last liberal Art, he tells the story of how most investment analysts perceived Amazon back in 2002 to be a bricks and mortar book retailer; ‘Amazon appears to be massively overpriced relative to the brick and mortar bookstores’. ‘Conversely, the bulls looked at Amazon and saw something different. To them, Amazon didn’t look like a Barnes…
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News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

Dollar Hits 12-Week Low on Trump, Nikkei to Slide: Markets Wrap (Bloomberg)

Asian stocks fell for a second day, led by declines in Japan and Hong Kong, after the dollar capped its worst month since March as the Trump administration reiterated its preference for a weaker currency.

ETFs could see $1 trillion in inflows over the coming year (Market Watch)

Exchange-traded funds have long been one of the hottest items on Wall Street, with investors pouring billions of dollars into them in recent years, favoring them over mutual funds in what is amounting to a massive industry upheaval. What’s more, the shift may only be gaining steam.

This Is Who Will Pay for Shutting Down North Sea Oil Rigs (Bloomberg)

Royal Dutch Shell Plc’s $3.8 billion sale of North Sea oil and gas fields creates a model for further transactions in a region where the question of who pays to remove decades-old offshore platforms has been an obstacle for other deals.

U.S. Consumer Confidence Eases From More Than 15-Year High (Bloomberg)

Consumer confidence retreated in January from a more than 15-year high as Americans tempered their economic expectations and waited for President Donald Trump and lawmakers to deliver on promises to boost employment and jump-start growth, data from the New York-based Conference Board showed Tuesday.

4 signs a stock-market selloff in February may be brewing (Market Watch)

U.S. stocks on Monday descended significantly for the first time in the Donald Trump postelection era that delivered a multimonth shot in the arm to equity investors.

Stock Investors Are Finally Starting to Buy Hedges Again (Bloomberg)

With the U.S. equity market waking from its slumber, investors are finally taking the hint to hedge their post-election gains.

Treasuries Rise as Trump Comments Spark Losses in Dollar, Stocks (Bloomberg)

Treasuries rose Tuesday, pushing yields to a one-week low, as President Trump’s allegation that other countries engage in currency devaluation drove down the dollar and weighed on stocks.

Yellen Urged to Halt Talks on Global Bank Rules for Trump Review (Bloomberg)

A key lawmaker wants U.S. banking regulators to


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Vetr Crowd Delivers An Upgrade After UPS Ships Underwhelming Earnings

Courtesy of Benzinga.

On Wednesday, the Vetr crowd upgraded their rating for United Parcel Service, Inc. (NYSE: UPS) from 3 stars (Hold), issued eight days ago, to 4 stars (Buy). Crowd sentiment for the stock was unanimously positive, with 100 percent of Vetr user ratings bullish.

UPS posted its quarterly earnings before the market opened on Tuesday. The report showed the company fell short of analysts estimates on both EPS and revenue for the tail end of 2016. That same day, analysts with BMO Capital downgraded UPS from Outperform to Market Perform.

In response to the report, shares of the package delivery company took a 11.7 percent dip to a low of $103.29 from its Monday closing price of $117. The stock gained a little ground near the end of Wednesday’s session, finishing the day around $105.35.

See how crowdsourced ratings could help you time the market.

Currently, the Vetr crowd’s average target price for the stock is up at $117.40, which is just below the average analyst target price of $118.08. Less than 2 percent of Vetr users are holding UPS in their watch lists.

Latest Ratings for UPS

Date Firm Action From To
Feb 2017 BMO Capital Downgrades Outperform Market Perform
Dec 2016 Aegis Capital Initiates Coverage On Neutral
Dec 2016 Loop Capital Initiates Coverage On Hold

View More Analyst Ratings for UPS


View the Latest Analyst Ratings

Posted-In: VetrUpgrades Price Target Crowdsourcing Analyst Ratings





Twilio Crosses $30 After JMP Upgrade

Courtesy of Benzinga.

Twilio Inc (NYSE: TWLO) shares are trading higher by $1.00 (3.6 percent) at $29.83 in Wednesday’s session. The catalyst for the rally is an upgrade from JMP Securities, which changed their rating on the issue from Market Perform to Outperform.

The issue, which had been in a trading range from $25.98 to $30.50, has tested the upper-range in today’s session. After a higher open, it continued in that direction with the rally stalling just ahead of that level at $30.37 and reversed course.

Twilio is attempting to post its first close over $30.00 since December 28, when it ended that session at $30.21.

Posted-In: Technicals Intraday Update Movers Trading Ideas





Facebook Nears All-Time High Ahead Of Q4 Report

Courtesy of Benzinga.

Facebook Nears All-Time High Ahead Of Q4 Report

Facebook Inc (NASDAQ: FB) shares are trading higher by $1.56 at $131.88 in Wednesday’s session. After the close, the company will release its Q4 report, with Street estimates for EPS at $1.30 on revenues of $8.49 billion.

The issue has been a stellar performer in 2017. It ended 2016 at $115.05 and reached $133.14 on January 24. That’s just shy of its all-time high made on October 25 at $133.50.

The issue quickly retreated from that level and fell $7.17 from $127.17 to $120.00 on November 3, when the Street was impressed with its Q3 beat. Eventually, the issue went on to bottom on November 14 at $113.55 and set the stage for the rebound to its current level.

Obviously, investors are leaning toward the long side ahead of the report, raising expectations for a blowout quarter. Since its IPO in May 2012, the company has missed on EPS one time when it was a penny shy for Q1 2013. The company also had a negligible revenue miss in Q1 2015.

Posted-In: Technicals Intraday Update Movers Trading Ideas





Rule By Brute Force: The True Nature Of Government

Courtesy of ZeroHedge. View original post here.

Submitted by John Whitehead via The Rutherford Institute,

“We are fast approaching the stage of the ultimate inversion: the stage where the government is free to do anything it pleases, while the citizens may act only by permission; which is the stage of the darkest periods of human history, the stage of rule by brute force.”

-Ayn Rand

The torch has been passed to a new president.

All of the imperial powers amassed by Barack Obama and George W. Bushto kill American citizens without due process, to detain suspects indefinitely, to strip Americans of their citizenship rights, to carry out mass surveillance on Americans without probable cause, to suspend laws during wartime, to disregard laws with which he might disagree, to conduct secret wars and convene secret courts, to sanction torture, to sidestep the legislatures and courts with executive orders and signing statements, to direct the military to operate beyond the reach of the law, to act as a dictator and a tyrant, above the law and beyond any real accountability – have been inherited by Donald Trump.

Whatever kind of president Trump chooses to be, he now has the power to completely alter the landscape of this country for good or for ill.

He has this power because every successive occupant of the Oval Office has been allowed to expand the reach and power of the presidency through the use of executive orders, decrees, memorandums, proclamations, national security directives and legislative signing statements that can be activated by any sitting president.

Those of us who saw this eventuality coming have been warning for years about the growing danger of the Executive Branch with its presidential toolbox of terror that could be used—and abused—by future presidents.

The groundwork, we warned, was being laid for a new kind of government where it won’t matter if you’re innocent or guilty, whether you’re a threat to the nation or even if you’re a citizen. What will matter is what the president—or whoever happens to be occupying the Oval Office at the time—thinks. And if he or she thinks you’re a threat to the nation and should be locked up, then you’ll be locked up with no access to the protections our Constitution provides. In effect,


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The History Of Money (In One Simple Infographic)

Courtesy of Zero Hedge

Today’s infographic from Mint.com highlights the history of money, including the many monetary experiments that have taken place since ancient times…

Courtesy of: Visual Capitalist

As VisualCapitalist's Jeff Desjardins notes, some innovations have stood the test of time – precious metals, for example, have been used for thousands of years. Paper money and banknotes are also widespread in use, after first being turned to in China in 806 after a copper shortage prevented the minting of new coins.

Other experiments didn’t have much staying power. The adoption of strange currencies such as squirrel pelts, cowry shells, or parmesan cheese are only remembered for their peculiarity.

Further, other attempts to stabilize the monetary system were abandoned early as well. The original U.S. gold standard lasted just 54 years, after FDR ditched it during the Great Depression. The Bretton Woods version (gold-exchange standard) lasted even shorter, abandoned after being in place for 26 years when Nixon ended all convertibility between the U.S. dollar and gold in 1971.

THE NEWEST CHAPTER IN OUR MONETARY HISTORY

Although the infographic ends with the introduction of cryptocurrency in 2009, it should be noted that the newest chapter in the history of money is taking place right before our eyes.

The “War on Cash” has been accelerating in recent years, as governments and central banks have called for the elimination of high denomination banknotes. While these anti-cash motions have also been made in many Western countries, the most vivid example of the demonetization is currently happening in India.

In November 2016, Indian Prime Minister Narendra Modi demonetized 500 and 1000 rupee notes, eliminating 86% of the country’s notes overnight. While Indians could theoretically exchange 500 and 1,000 rupee notes for higher denominations, it was only up to a limit of 4,000 rupees per person. Sums above that had to be routed through a bank account in a country where only 50% of Indians have such access.

There have been at least 112 reported deaths associated with this demonetization – including suicides and the passing of elderly people waiting in bank queues for days to exchange money. India’s largest organization of manufacturers, the All India Manufacturers Organization, also estimates in


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FATCA Needs To Go, But Unfortunately, The FATCA “Refugees” Are Never Coming Back

Courtesy of ZeroHedge. View original post here.

Submitted by Duane via Free Market Shooter blog,

GotNews posted an article yesterday about a “refugee problem” America has, referring to approximately 20,000 Americans who have renounced their citizenship under Obama’s leadership, and suggesting America “repatriate” said citizens:

America has a refugee problem. Not the Syrian refugees. No, not the Afghan ones. No, not even the Cuban refugees. I’m talking about the born-and-raised American citizens who got fed up, gave up their U.S. citizenship, and escaped Obama’s America while they still could.

Yes, that’s right: nearly 20,000 American citizens left Obama’s America and forfeited their American citizenship while Obama was President.

Nearly 20,000 U.S. citizens voluntarily gave up their rights to vote, run for office, and the freedom to pursue “life, liberty, and the pursuit of happiness”, while Obama was in office.

We shouldn’t be allowing anyone from the violent and dangerous Middle East, including so-called “refugees”, into the United States right now. The only refugees who should be entering the United States are the American refugees who fled Obama’s America. Not only do we have that duty to our fellow Americans, but they pose no threat to us like Middle Eastern “refugees” do.

What was missing from the article?  Discussion of the Obama-sponsored law that caused many citizens (mostly expats) to renounce their citizenship: FATCA (Foreign Account Tax Compliance Act).

FATCA has been beaten to death by other sources, but surprisingly, very few people are aware of what it does.  The whole purpose of the law was to “crack down” on overseas tax evasion.  Simon Black of Sovereign Man did an excellent job of summarizing the net effect:

Deep within its bowels fell the Foreign Account Tax Compliance Act, or FATCA for short. It was a sort of ‘law within a law’, and one of the dumbest in US history.

FATCA effectively commanded every single bank on the planet to enter into an information-sharing agreement with the IRS.

(Well, not so much ‘information sharing’. More like ‘information giving’. Because the US government doesn’t share anything with anyone.)

It all started based on a phony assumption that millions of Americans were hiding trillions of dollars in secret offshore accounts. And given how broke the US government is, they


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Trump’s Supreme Court Pick: Another Dilbert Persuasion Play?

Courtesy of Mish.

Donald Trump named Neil Gorsuch to succeed Antonin Scalia on the Supreme Court.

Is “Dilbert Persuasion Theory” in play?

I use that name in reference to Scott Adams the creator of the “Dilbert” comic strip. Adams proposed that Trump says and does things so extreme, and so many extreme things at once, that all Trump has to do is move a bit the other way to have his critics on the run.

Let’s put that theory to the test today starting with The Hill article Trump Taps Neil Gorsuch for Supreme Court.

Trump named Gorsuch, a well-respected conservative who sits on the Colorado-based 10th Circuit U.S. Court of Appeals, after a drama-packed day that resembled the president’s former reality show “The Apprentice.”

After narrowing his list of 21 picks to Gorsuch and Judge Thomas Hardiman of the Third Circuit U.S. Court of Appeals, both men came to Washington, D.C., giving the appearance that either could be picked.

Gorsuch is likely to face a tough confirmation battle, though he was seen as a less provocative choice for the court than Bill Pryor, the circuit judge for the U.S. Court of Appeals for the Eleventh Circuit.

Pryor was a favorite of outside conservative groups, but his controversial views might have made it difficult for Democrats to avoid filibustering him. He has argued that gay people should be prosecuted for having sex, and that abortion should be outlawed including in cases of rape.

Although Prior did not make it to the final two, he is in the on deck circle. Pryor’s views on abortion are extreme. Here is an article that came up just today William Pryor & Abortion: 5 Fast Facts You Need to Know.

Positions of Hardiman and Gorsuch

Please consider Politico excerpts on Thomas Hardiman.

While Hardiman has backed First Amendment rights in the context of political donations, he took a narrower view in a 2010 suit over an arrest for videotaping a police officer during a traffic stop, holding that there was no clearly established First Amendment right to record such an event.

Hardiman won favor with gun rights advocates for a 2013 dissent that said New Jersey was violating the Second Amendment to the Constitution by requiring those seeking to carry a handgun to demonstrate a “justifiable need” for such a permit.


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This Won’t End Well – China Skyscraper Edition

Courtesy of ZeroHedge. View original post here.

China has been on a skyscraper-building boom for years, but, we suspect, 2016 may have seen the mal-investment boom jump the shark.

As Goldman Sachs illustrates in the following chart, China was head, shoulders, knees, and toes above the aggregate of the rest of the world in terms of skyscraper completions in 2016…

Could record-setting skyscrapers signal economic over-expansion and a misallocation of capital?

EWN Interactive, a subscription service focused on technical analysis, thinks so. The following infographic follows the “Skyscraper Curse” through six different market tops and subsequent crashes over the past century.

It is gigantic in size, so please click here or the below image to access the legible version:

Courtesy of: Visual Capitalist

EWM Interactive sums up the infographic with these words:

In the market, extreme optimism results in price bubbles. One of the real-life manifestations of extremely positive social mood is the construction of enormous buildings. Market tops and skyscrapers often seem to emerge simultaneously, because both phenomena are the result of the illusion of infinite prosperity.

But extreme psychological conditions do not last very long. That is the reason why record-breaking buildings, whose construction starts during a market bubble, are often completed after the bubble’s collapse.

*  *  *

In January we noted a perfect example of the smoke-and-mirror-ness of China’s credit-fueled expansion, as a 27-storey high-rise building which was completed on November 15th 2015 was just demolished, “having been left unused for too long.”

And just this week, another illustration of Keynesian perfection as China created, then destroyed 19 massive structures, to make room for an even bigger skyscraper. The epic explosion that took place in Wuhan, the capital city of Hubei province, leveled 19 seven to 12-story structures in a controlled demolition, the South China Morning Post newspaper reported, citing local media. The city authorities are planning to demolish at least 32 buildings to make way for a new business center that will reportedly feature a 707-meter tall skyscraper, which is to be one of the tallest buildings in the world.

*  *  *

The silver-lining – now workers can clean up the mess, dig a bigger hole… and fill that in – all in the name of Keynesian “growth.”





 
 
 

Phil's Favorites

DARK TOWERS by David Enrich

 

In his best-selling book Dark Towers, David Enrich, finance editor at The New York Times, chronicles the complicated history of Deutsche Bank and its entanglement with Donald Trump. Reviewing Dark Towers, Roger Lowenstein writes, 

"Enrich’s most tantalizing nugget is that in the summer of 2016, Jared Kushner’s real estate company (which received lavish financing from Deutsche) was moving money to various Russians. A bank compliance officer filed a “suspicious activity report,” but the report was quashed and she was fired. The suggestion that maybe the money was payback for Russian campaign meddling isn’t one that Enrich can prove. Similarly, we will have to wait to see if Deutsch...



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Zero Hedge

NYSE Announces Disaster-Recovery Test Due To Virus Fears

Courtesy of ZeroHedge View original post here.

In a somewhat shocking sounding move, given administration officials' ongoing effort to calm the public fears over the spread of Covid-19, The New York Stock Exchange has announced it will commence disaster-recovery testing in its Cermak Data Center on March 7 amid coronavirus concern, Fox Business reports in a tweet, citing the exchange.

During this test, NYSE will facilitate electronic Core Open and Closing Auctions as if the 11 Wall Stree...



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Chart School

Dow, Three strikes and your out!

Courtesy of Read the Ticker

The Dow has topped out with major events, the current virus could be the third strike!

2001 - 9/11 Twin Towers
2007 - Bear Sterns
2020 (?) - C19 Virus


Chart explains all. Dow Jones Industrial's comparing market tops 2000, 2007 and 2020.


Click for popup. Clear your browser cache if image is not showing.












Changes in the world is the source of all market moves, to catch and ride the change we believe a combination of ...

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ValueWalk

Cities With The Most 'New' And Tenured Homeowners

By Jacob Wolinsky. Originally published at ValueWalk.

Homeownership is a major investment. Not just financially, but when a person or family purchases a home, they’re investing years – if not decades – in that particular community. 55places wanted to find out which real estate markets are luring in new homebuyers, and which ones are dominated by owners that haven’t moved in decades. The study analyzed residency data in more than 300 US cities and revealed the top 10 cities with the most tenured homeowners – residents who’ve lived in and owned their home for more than 30 years – are sprinkled across ...



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Kimble Charting Solutions

Financial Crisis Deja Vu: Home Construction Index Double Top?

Courtesy of Chris Kimble

Most of us remember the 2007-2009 financial crisis because of the collapse in home prices and its effect on the economy.

One key sector that tipped off that crisis was the home builders.

The home builders are an integral piece to our economy and often signal “all clears” or “short-term warnings” to investors based on their economic health and how the index trades.

In today’s chart, we highlight the Dow Jones Home Construction Index. It has climbed all the way back to its pre-crisis highs… BUT it immediately reversed lower from there.

This raises concerns about a double top.

This pr...



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Insider Scoop

A Peek Into The Markets: US Stock Futures Plunge Amid Coronavirus Fears

Courtesy of Benzinga

Pre-open movers

U.S. stock futures traded lower in early pre-market trade. South Korea confirmed 256 new coronavirus cases on Thursday, while China reported an additional 327 new cases. Data on U.S. international trade in goods for January, wholesale inventories for January and consumer spending for January will be released at 8:30 a.m. ET. The Chicago PMI for February is scheduled for release at 9:45 a.m. ET, while the University of Michigan's consumer sentime...



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Biotech & Health

Could coronavirus really trigger a recession?

 

Could coronavirus really trigger a recession?

Coronavirus seems to be on a collision course with the US economy and its 12-year bull market. AP Photo/Ng Han Guan

Courtesy of Michael Walden, North Carolina State University

Fears are growing that the new coronavirus will infect the U.S. economy.

A major U.S. stock market index posted its biggest two-day drop on record, erasing all the gains from the previous two months; ...



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The Technical Traders

SPY Breaks Below Fibonacci Bearish Trigger Level

Courtesy of Technical Traders

Our research team wanted to share this chart with our friends and followers.  This dramatic breakdown in price over the past 4+ days has resulted in a very clear bearish trigger which was confirmed by our Adaptive Fibonacci Price Modeling system.  We believe this downside move will target the $251 level on the SPY over the next few weeks and months.

Some recent headline articles worth reading:

On January 23, 2020, we ...



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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

...

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Members' Corner

Threats to democracy: oligarchy, feudalism, dictatorship

 

Threats to democracy: oligarchy, feudalism, dictatorship

Courtesy of David Brin, Contrary Brin Blog 

Fascinating and important to consider, since it is probably one of the reasons why the world aristocracy is pulling its all-out putsch right now… “Trillions will be inherited over the coming decades, further widening the wealth gap,” reports the Los Angeles Times. The beneficiaries aren’t all that young themselves. From 1989 to 2016, U.S. households inherited more than $8.5 trillion. Over that time, the average age of recipients rose by a decade to 51. More ...



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Digital Currencies

Altcoin season 2.0: why bitcoin has been outgunned by crypto rivals since new year

 

Altcoin season 2.0: why bitcoin has been outgunned by crypto rivals since new year

‘We have you surrounded!’ Wit Olszewski

Courtesy of Gavin Brown, Manchester Metropolitan University and Richard Whittle, Manchester Metropolitan University

When bitcoin was trading at the dizzying heights of almost US$2...



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Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

Courtesy of  

The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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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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Ilene is editor and affiliate program coordinator for PSW. Contact Ilene to learn about our affiliate and content sharing programs.