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Faltering Thursday – Fed Tightens, Trump Gets Probed

Image result for trump probe cartoonWheeee, this is fun!  

It's not an indictment, it's just a probe but now we know why Trump wanted to fire Special Investigator Mueller the other day – apparently he wasn't loyal to Trump either and he's now officially investigating the President for the obstruction of justice the President has already bragged about when he said to the visiting Russians:

“I just fired the head of the F.B.I. He was crazy, a real nut job.  I faced great pressure because of Russia.  That’s taken off.  I’m not under investigation.”

Master.  Oh sorry, that last word might not have been a direct quote – just stating the obvious.  Well, it's not even a month later and NOW the President is under investigation and Trump himself just said that the GOP health care proposal is "mean", so that's not going to pass – especially with "more money" because the Fed just took Trump's Budget off the table with updated forecasts that indicate we'll be LUCKY to see 2% GDP growth for the rest of this decade:

That's HALF of the Trump Budget Projections that STILL put us over $1 TRILLION in debt for each of the next 10 years AND, with the Fed on path to TRIPLE interest rates over the next 2 years, the $285Bn of interest payments we now pay will also triple to $855Bn, making interest on debt alone the most expensive line item in the budget and that's ONLY if we keep the debt down to "just" $20,000,000,000,000.00 – at Trump's projected $30Tn, our interest payments would be $1.3Tn but THAT is assuming 4% growth boosts revenues.  At 2% growth, we'd end up about $40Tn in debt paying $2.6Tn a year in interest and running a $2.5Tn annual deficit.  

So either the Trump budget is dead or you should quickly make arrangements to get out of the country while you still can because, even at "just" $20Tn, your share of the National Debt is $165,897 (each taxpayer).   Of course, if you are in the Top 0.1% and making more than $3M a year, that doesn't bother you very much so let's hope the budget passes and we get those tax cuts but, for the poor slobs who take home less than 7-figures, $165,897 sounds like real money.

National Debt Clock

How do you stop debt from spiraling out of control?  Collect more taxes and pay it off!  It's not complicated.  There are 120M households in this country and the Top 1% earn $1,260,508 on average for a total of $1.5Tn/yr and Corporations make another $3Tn a year for $4.5Tn.  A 20% surcharge on those incomes would put just under $1Tn per year towards deficit reduction so that + a balanced budget amendment would pay off the deficit entirely by 2038 and make America the richest country on Earth, unhindered by debt.

Image result for trump budget debtOr we can go with Trump's plan and DECREASE their taxes by 30% and destroy the country – you decide what really makes America Great Again.  

This stuff is just math folks.  You can't cut taxes to the Top 1% and slash Government programs that are there to help the Bottom 99% and expect the country to fix itself or be "trickled down on" by the Top 1%, now that the pesky Government is out of the way.  That's like a fairy tale we tell to children – except we hope our own children aren't stupid enough to believe that kind of nonsense, right?  

I know this article will be censored on most MSM outlets that publish me, but someone has got to say something to stop this thing.  This isn't just a mistake – this is National Suicide and, unlike the song, it will not be painless!  If you are an American, a real American – Democrat or Republican – you have to think about what is really going to be good for your country and your children's future.  If you think that giving $1.1M tax cuts to people who make $3.7M a year or more (top 0.1%) ACCORDING TO FORBES is the best thing your country can do right now – then feel free to let it happen.  If not… Well, as they say:  "If you see something – SAY SOMETHING!"   

Meanwhile, the market is doing just what we expected it to do post Fed and the S&P (/ES) is down around 2,420 for our 3rd $400 per contract gain in a row this week from yesterday morning's PSW Report.  The Russell (/TF) is just testing 1,400 this morning and that's up a whopping $1,500 per contract and the Dollar did just as we expected and rose an entire basis point (96.10 to 97.10), post-Fed and that one is good for gains $1,000 per contract so far – and I say so far because the Bank of England (also as predicted) did not raise rates so the Dollar should get even stronger by comparison.  

Oil (/CL) and Gasoline (/RB) took a dive on disappointing inventory reports but more so because more and more Global supply is coming on-line and demand is still nowhere in sight.  Though the information is 2 months old (April), the IEA released a report showing a 19Mb net build in global inventories and we're right back at the top of our 5-year range, which is where we were last year, when oil was under $40 (briefly) in July and gasoline bottomed out at $1.27, which is another 0.16 (12%) below the current $1.43.

So far, we haven't seen a major effect in the already beaten down Energy Sector (XLE) or Oil Services (OIH) but those companies were responsible for a large portion of the S&P's earnings recovery, as were the banks that lend them money.  If oil ends up performing as poorly this summer and fall as it did last summer – even with the former CEO of Exxon (XOM) as Secretary of State – well then this has the makings of a long-term economic disaster.  

We are, nonetheless, playing Oil (/CL) long at $44.50 and Gasoline (/RB) long at $1.415 in hopes of a bounce into the weekend but, as with yesterday's morning play – tight stops below or things can get very ugly very fast!  We think the strong Dollar is holding them down at the moment as yesterday's sell-off was a bit of an overkill in the short run but, long-term, this is about the right range for oil ($40-50), so don't expect a big move up.  

With the Fed beginning to wind down QE, it's going to be very hard for the markets to sustain these all-time highs but the reason the Fed feels comfortable raising rates is because they think the economy is strong enough to grow without stimulus and that's a good thing.  Unfortunately, many stocks are priced for QEForever and that's simply not going to happen and we'll sit back and see how big of a correction we get now that all the cards have been dealt.


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  1. Good Morning

  2. Morning everyone! 

    Join us for our weekly webinar at 1pm (Eastern) here:

  3. Russian Doll, looks like Hillary on a good day.

  4. Good Morning.

  5. Latch – My guess is Hillary would be more Woman then you'll ever have…..

  6. :)

  7. Uplifting post of the day – an French Republican Guard orchestra plays "Don't look back in anger" before the France-England soccer game in homage to the victims in London and Manchester:

    Some French fans including the president were seen singing God Save the Queen later!

  8. Latch – of course Trump doesn't have any good days!

  9. It's so funny to see these guys talk about toning down the rethoric when they sat idle while people called Obama a commie, a liar during the SOTU speech, used the "N" word or question his citizenship!

  10. If the French and the English can get on (we have history) at a Football match (think Ice Hockey but more anger) and French lawmakers can support us even with our Brexit hats on then … well anything is possible.  

  11. Interesting thoughts:

    Creating the proper asset allocation and staying with it has a much bigger impact on your returns than selecting the best performing funds within those asset classes. The chart below is visual evidence of this. Portfolio 2 sold after the 23.3% decline in 2008, sat out 2009, and returned to the model in 2010. Portfolio 3 also sold after 2008, but it waited two years and returned to the model in 2011. This type of behavior kills returns. If you’re going to run away from risk after it’s already taken a bite out of your portfolio, you shouldn’t be investing, period.

  12. stjean – I think it's great that our dysfunction seems to have a unifying effect in Europe…

  13. good morning… where is jabob today?  he is getting his TSLA wish.

  14. taking profits ;-)

  15. Good morning! 

    Nice pop in /RB since the NYMEX opened at 9, cutting 1/2 the losses.  I've been buying 5 of the /RBQ7s while they were cheap and then it got away from me so I'll be cutting my /RBN7s very quickly if they lose ground as I'm "only" down about $3,000 now and 5 /RBQ7s can make that up for me just fine.  

    /CL not as lucky, $45.10 is my break-even on 10.  

    Big Chart – Nas still holding us back of all things.  

    Risk/StJ – True. 

    Dysfunction/1020 – Yes, Trump is bringing the World together – against us!  

    TSLA wish/Learner – My wish is a bit lower than that.  Still, beats yesterday's madness. 

  16. I wonder where we go with oil – $44 has been a good support line over the last 12 months but we dipped to $40 last August. There is no real catalyst for an upward move right now.

  17. TSLA convertible stock released today

  18. Unifying / Phil – Not true, Putin, Erdogan and Duterte are with us!

  19. Phil – Anything else worth waiting for before we close out of the UUP position? Thanks.

  20. But what about the wall? Tax cuts? Health insurance? Great again? Don't tell me the billionaire reality tee vee star was full of crap, who could have seen that coming? Go Team! Who needs freedom anyway, just raise taxes! Oh the simplicity, and congress shall balance the budget. I get it! That's what Hillary would have done… Well, we can certainly sit back and call them names now! Thank goodness the comedians on tee vee have plenty to joke about, I was worried. Whew, there is no respect left for government, but at least we can all have a laugh and move to another country.

  21. Phil, we're looking for 1.445 as the strong bounce correct? 

  22. Sorry, on /Rb 1.445 for the string bounce? 

  23. go TEVA

  24. go FTR

  25. Winston,

    Great call on GS who we frequently times demonize as the ultimate unseen hand behind the curtain. Like them or not, they are Masters of the Game and demonstrate what unrestrained influence looks like. I can appreciate the difference between social/societal and investment perspectives. GS is in a category by itself; the pullback (hopefully) to 210 from 257 presented an appealing entry.  Thanks for sharing.

  26. UUP/Max – This might be about it, not too thrilling with UUP at $25.20 and the calls are fetching 0.23 for a 50%ish loss.  I'm in no hurry to sell, might go higher, shouldn't go lower. 

    /NG popping off report, just a small build (78BCF) indicating normal demand.  

    That puts me back in first class!   

    Even coffee is picking up today:

    Laugh and move/Mkucs – Sadly, it's our best play…  I don't see things changing here.  I was hopeful when Obama was President but the fact that the people in this country can let Donald Trump be their President and the way they accept the lies and excuses and incompetence – it's just too much.  How can you live in a place that can be broken at a moment's notice.  And the "checks and balances" that have held our country together are being destroyed – to the glee of half the country!  And all they are doing is making a path straight to a succession of the blue state – and those are the states with the money.  The red states are essentially 3rd world if the blue states pick up their toys and leave.  Other than Texas, it will be like Germany, UK and France leaving the EU.  Oops, UK already leaving – well, that's another problem that won't be going away…

    Trump is being openly mocked by other World leaders, this country has become a joke – and not a good one.  8 decades of post WWII leadership building are evaporating in just 6 months – I can't even imagine where we'll by this time next year but you can mark this post and see if I'm right – it's not looking good.  

    /RB/Jeff- Well I've flipped out of all my /RBN7s and now "just" 6 /RBQ7s and I'm content to let those ride. 

    Meanwhile, I'm trying to get the LTP Review done before the Webinar.  

  27. Phil—when are you going to tell us how you really feel about the POTUS????

  28. EPZM….zoom zoom. 

  29. Pharm 


    Dynavax Technologies DVAX

    Any interest


  30. 8800 – thanks. I'm keeping my eye on non-tech large cap dividend players.

  31. Long-Term Portfolio Review (LTP) Part 1:  $1.4 MILLION!  That's up $900,000 (180%) from our $500,000 start back on 11/26/13 so a bit over 3 years to get that far but the main point I want to make is this is getting easier, not harder, as time goes on because our mature positions, like the Butterfly Portfolio, simply crank out gains from premiums we sell and dividends we collect.  They've long ago been paid for as we're back to $1,073,540 in CASH!!!, which is twice as much as we started with.  

    If you are new at PSW, I would strongly encourage you to go back to our first cash-out review (which summarized all of our trades at the time, after 6 months) and then go forward a year to see how slowly we add things.  Generally we'd sell one or two puts a month and, if the position got cheaper – we'd set up a bullish spread to go with them (assuming we still liked them).  

    At the time we had AAPL, ABX, BRCM, BTU, CAKE, CAT, CLF, DBA, DE, EBAY, EGLE, FCX, GLL, HK, HOV, INTC, IRBT, LGF, LULU, MSFT, NLY, RIG, RRD, SHLD, SLW, SPY, T, TASR and TWTR and we were up 19% in 6 months and were worried about a correction (as usual).  Not too different than what we do now with a lot of the same stocks – it's the discipline that's important to develop, not the positions.  The Man Who Planted Trees tells you everything you need to know about running a long-term portfolio!  

    Step one in building a portfolio is, of course, identifying stocks you want to buy (and once you buy your first one, all the rest need to balance with it!).  Step 2 is NOT BUYING THE STOCK.  That's one people seem to have trouble with.  Why would you buy the stock when you can sell a put and give yourself a discount?  60% of the time, that's how we initiate a position in the LTP.   Even when we we do start with a spread, we keep it small so we can easily double down – TWICE – if the stock gets 20% or 40% cheaper.

    If you start with a 20% discount ($100 becomes $80) and then you don't add more unless it's down at least 20% ($80 + $64)/2  = $72 avg on 2x = $144) and then you don't add more unless it's down at least another 20% ($72 + 50)/2 = $61 avg on 4x = $244) you end up with 4x at close to 1/2 of what you would have paid ($400) if you jumped right in at full price.  That's why we're THRILLED when a stock we like gets cheaper – even if we're already "stuck" with shares.  

    • ABX – Loose leg of spread below, we will deal with it later. 
    • AGNC – On track.
    • ATVI – On track. 
    • BBBY – Here's one that got cheaper but still $36.27 and our net is $35.50 so we're still good but I do like BBBY and, rather than commit to more puts, let's just add a bull call spread while they are cheap like 10 2019 $30 ($8.50)/$40 ($3.85) bull call spreads at $4.65 ($4,650) and those pay $10,000 if all goes well and we already collected $4,500 from the short calls so our net cash outlay is now $150 with $9,850 upside potential and we're already $6,270 in the money.  See why I like it when things get cheaper?  Great for a new trade, of course.

    • BRK.B – I WISH these would lose money so we could buy more cheaply!   On track.  
    • CMG – On track.
    • DIN – New, good for a new trade.  
    • DNKN – On track.
    • ESRX – Good for a new trade.  
    • GOGO – We cashed GOGO on 5/31, I forgot it was in the LTP too – will be fixed.  

    • INFN – On track. 
    • KATE – No point in these anymore, let's buy them back and clear a slot.  
    • M – I still like them, good for a new trade.  (not enough to add a spread, though).  
    • MON – On track.  China starting to buy from them – huge.  
    • NLY – We were hoping they'd get cheaper but they didn't.  Our consolation prize is $8,250 for not owning them.  On track. 
    • RH – On track 
    • SBUX – On track. 
    • SEE – On track
    • SKT – Good for a new trade
    • SKX – On track
    • SPWR – On track.
    • TGT – On track
    • TLRD – Good for a new trade
    • TWX – On track
    • VZ – Good for a new trade
    • WATT – Good for a new trade.  

    We have 25 short puts and, if they all expire worthless, we'll keep/profit about $90,000 – NOT including the profits we've already made (maybe $40,000).  This is that tree-planting part, every month we find something to sell for about $4,000 and some will become positions and most will simply end up turning into cash, which we use to buy more positions.  After 2 years, we have 24-36 in progress at any given time and it's $50,000+ in bonus profits each year, which is 10% of our original principle.  

    It's a totally passive way to make money, very low-maintenance and your worst case is owning good stocks at great discounts, which then drops them down to one of the trades below…

    • ARR – It went up and up and up and we never had a chance to sell the puts.  We'll end up getting called away at $22.50 but, until then, we get the monthly dividends.  

    • CM – They have finally come back down and we can sell 5 of the Dec $80 puts for $5 to net in for $75 because we REALLY would like to own more of this stock (especially since we're losing ARR) and their 0.95 quarterly dividend.  
    • FCX – Very simply, if we have a bull call spread in the LTP is probably because we're waiting for a pullback to sell puts.  We have one here so let's sell 15 of the 2019 $12 puts for $2.25 as we'd be happy to double down on those if FCX tests $9 again.

    • IBM – Let's sell 5 of the 2019 $135 puts for $9.50.  Thrilled to own that stock at net $125.50!  
    • OIH – Not confident in these enough to sell puts.  If oil doesn't recover next month, we may have to take a loss on the spread and get out.  
    • CG – On track
    • CLNS – On track
    • FNF – On track
    • GCI – On track
    • GME – Good for a new trade
    • GNC – Good for a new trade.  
    • HOV – On track.

    HOV doesn't pay a dividend but, when it was $1.47, it made more sense to buy the stock than pay a premium for a long call in a bull call spread.  The rest of the ones above pay lovely, lovely dividends of about $6,000/qtr and there's another $24,000/yr (5%) that just rains into our pockets and will rain into the pockets of your children and your grandchildren and your great grandchildren.   Dividend stocks should become more and more of your portfolio as it matures (and as you do) – you should always be looking for good ones to add.  

    Think about what we're accomplishing.  In 3 years we have 6 positions throwing off $24,000 and in 6 years we'll be getting $48,000 and in 12 years $96,000 and in 24 years $192,000 – all from our $500,000 initial investment and dividends tend to grow with inflation so $192,000 a year then is the same buying power you wish you had now.  

    Slow, consistent investing with clear goals in mind – that's all it takes to build wealth sensibly and reliably! 

  32. Phil is it unusual that the August contract for RB is cheaper than the July contracts? This is not normal right ?

  33. Phil – What do you think of PSO?  I know they used to be in a portfolio somewhere, and I'm down about $600 on them.  Anyway I have a June $10 short put expiring this week.  Wondering if I should just take assignment, and hold the stock to get the div.  Then sell more puts.  

    PSO 16JUN2017 10 P

  34. What is the take on RIG- I don't see it in any of the portfolios?

  35. POTUS/Jabob – Yeah, what a guy.  He's on TV right now mispronouncing his "good friend" Scalise's name.  It's amazing how many people Trump claims to have personal relationships with when he never goes out.  

    EPZM/Pharm – Another nice put sale – good call.   

    Trump says I can have an apprentice!  

    /RB/Craigs – Well we just had a fast bounce but also we're not the only ones who think July 4th is a catalyst but, after that – DOOM!!!!  Keep in mind you are betting on where it will be on expiration day in Aug, not where it is today or will be on July 4th. 

    PSO/Burr – They are still in the LTP.  We bought them at $12.25 and sold calls for maybe $1.25 (bought them back already) so net $11.50ish, and we sold $10 puts for $1.15 so net $10.35ish and now $9.03 and I still like them for a long-term play.  They are still paying an 0.85 dividend so 10%ish but it's a long-term turnaround with more FUs ahead.  

    RIG/Pstas – I lost faith a while ago.  Don't see deep water drilling coming back much at these oil prices.  

    LOL, Trump is paying back Sessions for his weasely silence by talking about the drug problem in the US (completely out of context, for no reason).  I love to see politics in action!  

  36. Phil,

    Would like to have your thoughts on DLTR & DG in the dollar store space.

    DLTR leads in PEG, EPS & Rev Growth & oper mgns, but had a 2015 reversal in earnings growth (revs have been growing steadily); DG has a slightly lower PE (18 vs 22) and a higher ROE (57 vs 17 for DLTR). DG is expanding more rapidly and DLTR is in a legal pissing contest with Sycamore Ptnrs. The space seems viable in good times and esp bad. Options seen reasonably attractive.

    Thanks in advance

  37. Phil – Great post and advice on the LTP. 

    Thanks !

  38. So it unusual ?

  39. Took /NGV7 and ran at $3.075 - up $6,000 for the day!  If it doesn't pull back, I'll add back in over $3.10 with tight stops but when doesn't /NG pull back?

    DLTR/8800 – I do not like them and have said so in the past.  

    Submitted on 2016/11/22 at 9:59 am

    DLTR/Batman – I'm not a fan of the Dollar stores in general and President Trump is not likely to be putting cash into the hands of Dollar-Tree shoppers.  Having fallen from $100 to $75 is $25 and that means a weak bounce is $5 to $80 and a strong bounce would be $10 to $85 or else it's just bouncing in a down-trend that seemed very well-deserved after August earnings.  They make about $4 per $90 share and you'd have to spend quite a while explaining why I'm paying more than 20x earnings for a retail store. 

    Now they are a bit cheaper and right about 20x their actual earnings (not the BS fantasy they had going last year).  I thought you were already in it but, if you're not, then keep an eye on the 2019 $67.50 puts, now $7, as that's enough cushion (net $60.50 = 20% discount) to make it a little interesting.  

    Thanks Albo.  

    Unusual/Craigs – It's called Backwardation and it's what happens when the long-term sentiment is negative.  Happens less often then Contango because commodities go up more often than they go down in long runs but I wouldn't say it's "unusual" any more so than it's "unusual" to meet someone who's left-handed, for instance – a bit too common to call it unusual.  

    Wow, /NG was just waiting for me to sell!  

  40. Phil,

    Thanks for the candid thgts on DLTR/DG space. Must have missed your earlier cmts. My rationale was that if things really go to hell in our economy the dollar store space may be a sort of hedge. Might not have a top 1 percenter aisle but maybe one for the rest of us (with Kale and Bruce Springsteen music).

  41. Phil – RB – Do you recommend entry at this level?

  42. ~~Redskins’ Kirk Cousins played a round of golf with President Trump.

    While trying to decide whether or not to fire the special prosecutor, POTUS clears time for some good old fashioned jock sniffin.

  43. Albo – And Obama played too much golf, right?

  44. Hi Phil,  Thanks for the LTP review and thoughts and comments on the portfolio history from inception.  Guiding principles to follow as I am building out my own portfolio.  I was curious if you track daily or monthly snapshots for performance – just wondering about the maximum drawdown the portfolio endured as it grew over time?    Thanks again.

  45. All I want is a quick bounce on CL to 45 and I would be truly grateful. 

  46. Oh Canada—— I see chatter where plans of deserting the Land of the Free are starting to formulate.  I guess it would be ok, we do have a little room left.  We would politely ask that you leave your guns at the door and any plans to lobby for AK7`s as well.  Don`t expect more for your dollar, we will exchange them at par.  Warning, do not expect Shangrilai  here. Yes the health care is free but if it isn`t an emergency you may have to wait a bit.  And you will have to help chip in a bit for our enormous debt. We have a spend spend spend on useless stuff guy in charge.  He was a surfing instructor before getting the big office.  Also be warned, much of the country is freaking cold.  Might want to check out Mexico although your reception there may be ironically a little frosty.  Good luck though

  47. To have a good idea of what's happening in the white house, this is still the best feed:

  48. Just a reminder since it's not the usual day… it's Webinar time!

  49. DVAX…PDUFA is in August for HepB.  Odds are favoring approval.  How about Oct 6/10 Calls for 1.70, selling July 7 Puts for 35c.  Net in for 1.25.  All or nothing trade assuming the 7 Ps go worthless.

  50. DLTR/8800 – Was going to discuss in Webinar.  Consider their problem with $1 price point and inflation.  To pass on cost, they have to change their whole business model and reeducate public and change their expectations.  That's what destroyed Woolworths 5 and 10 (cent) in the end.  There's a place called Five ($5) Below (FIVE) that makes more sense as a model for your premise and, as you can tell from their chart – things are going better for them. 

    /RB/Bulls – Well I was down $10,000 before bulling it back today so sure, if you like pain and suffering I love it here.   I do have 6 /RBQ7s at $1.417 which I intend to hold for the presumed run-up but could blow up in my face again.   Reward seems better than risk – that's all. 

    Oops, I'm getting in trouble!  Webinar time!

  51. Phil – RB backwardation…makes sense if sentiment thinks after July 4, demand drops. Also the previous years had big dips.

  52. Pharmboy 


    Thanks again

  53. CHS/Phil – another retailer, knocked down to discount price?

  54. SVU – value becoming even more super

  55. TGT???

  56. OMER/Hanj – closed out. Will look for that pullback to reenter

  57. From what I've been reading, TSLA must do a secondary before July.  Stock might sell off further until it is announced and that was most likely the reason Adam Jonas helped bump them up 17 the other day since his firm will be doing the secondary and he gets a bonus off of investment banking business.  So much for Chinese Wall.  After TSLA announces secondary price though, the firm has been pretty good at holding it, so if you wrote puts say 20 points below it in a couple weeks time frame, you should be ok.  In the past you were.

  58. Actually wouldn't be surprised if the convertible stock off the last secondary was dumped today and the profits +100 points are rolled into new secondary.

  59. thanks rustle!

    I would think selling puts might be as dangerous as selling TSLA calls.

    What happens if they announce a hiccup w the Model 3 release?

    I would think the stock would drop much more than 20 points, right?

    I still can't understand how this stock is up so much this year?

    Obviously, the short trade is very overcrowded and we keep getting squeezed.

  60. Pharm,

    SGYP making good progress. 

    Reaffirmed: Synergy Pharmaceuticals Inc (NASDAQ:SGYP) Buy Rating Reiterated at H.C. Wainwright; $18.0000 Target in Place

  61. Morgan Stanley usually supports a secondary well and it will be before release which makes it easier for them because the hype leading up to it should keep them stable or up.  They only support for about 2 weeks then it wanes.  They don't want cancellations on the secondary.

  62. KR – oh my.

  63. KR – Blame it on AMZN ?  This from briefing :

    ~~Kroger (KR 24.74 -5.53, -18%) is selling off huge after significantly lowering guidance for FY18 to $2.00-2.05 from $2.21-2.25. They reported in-line Q1 (Apr) results but the guidance is scaring investors. They do not say much in the press release or the call, but my sense is that online competitors like Amazon (AMZN) are making inroads in the grocery space to the extent that it's starting to have an impact on grocery chain's financial results. We have all read how big box retailers like TGT and WMT are being impacted but grocery chains may be next.

    Seems like there must be other reasons as well.

  64. Looks like the stick is back.

  65. Well, not much happening, is it?  

    Drawdown/Learner – As we covered in the Webinar.  The design is meant to avoid drawdowns.  As to performance, you see me often noting where they stand dollar-wise, that's how I check to see if we're balanced or not and days when we get a big move, like last week, I like to benchmark how we're handling the stress.  It should be like sailing a ship, follow the star north and make small adjustments as necessary.  

    $45/Craigs – Yes, being off by 0.60 should not cost you $6,000!  angry

    Cold/CDN – Trump is fixing that.  

    That's why I'm considering Canada, you guys will actually do fantastic in warmer weather.  

    CHS/Scott – I agree, good price and I like clothing as sizes and fabrics don't translate well for web shopping.  

    Great prices for the 2019 $10 puts at $1.40 so you can sell 10 of them ($1,400) and buy 20 of the $8 ($2.60)/$12 (0.90) bull call spreads at $1.70 ($3,400) for net $2,000 on $8,000 worth of spreads with a $6,000 (300%) upside potential at $12.

    SVU/Scott – Below $4 is not good but at least we're not KR (yet)!  

    [$$] Kroger Shares Slide as Grocer Is Battered by Price Fight

    TGT/Jabob – Just had a shareholder meeting.  I guess it did not go well.  They boosted the dividend but I think people were hoping for more concrete ideas to combat AMZN and WMT.  

    KR CEO coming on CNBC soon. 

  66. Albo,

    Are you hanging in there with FNSR through the close? Just shorted some Dec calls to protect FNSR stk. Tempted to pair my FNSR & AAOI longs with shorts in weaker brethern, ACIA, FN.

  67. Canada Warm Up > Great Graphic “We’ll be frying eggs on the Toronto sidewalks and using suitcases to move our money”, and …. will relocate the 5 remaining polar bears to the South Pole. 

    What can go wrong, eh? No mention of the mozzies who will be around year round and grow to the size of compact cars. Oh Canada!

  68. 8800 – I'm going in net long, but have covered some stock with OTM calls.  I'm expecting the results to be viewed positively, but I could, and have been, wrong before.  Should be interesting.  Plan to use any weakness to add to position.

  69. Mozzies???? Enquiring minds want to know

  70. Moose plural

  71. can't keep tsla down 

    and cnbc always has another tsla pumper on, of course

  72. Thanks for the feedback. I have a preference for AAOI and have increased my stake on this pullback (58 was the 50% retrace from 40 to 75) also. We shall see. In for a penny/in for a pound.

  73. Albo,

    FNSR/AAOI comment above; Melania must have deleted your name

  74. ~~



    Finisar sees Q1 $0.37-0.43 vs $0.51 Capital IQ Consensus Estimate; sees revs $330-350 mln vs $366.16 mln Capital IQ Consensus Estimate.

  75. Nas still down 0.5%, RUT not too far behind.  

    Mooses/Aquila – Well then you are going to need those assault weapons after all!  

    Image result for bullwinkle moose animated gif

  76. Fortunately until we hit 46 where you will be crowing about your $10000 win, I am only down a fraction of that, and concerned about that overhang. I believe the risk reward is in our favor but no conviction.

  77. Mozzies = Mosquitoes ….. as large as vampire bats. Then there are also the other blood sucking bugs.

  78. Mosquitoes?  I'm out!  Hate those things…

  79. Image result for chris rock mosquito animated gif

    Greetings from Canada!  

  80. that is a baby one who's hungry in Louisiana. We had sunroofs  back then as well.

  81. Looks like a shotgun would be more appropriate for the mosquito. Moose, plural… ROTFL :)

  82. ~~



    Finisar has reversed off lows and is now up 8% after detailing longer term guidance during its call . 

    •The co is optimistic about FY18 outlook and expects revenue growth to resume in Q2 (current Cap IQ consensus is for Q2 revs +5.4% y/y to $389.8 mln).

  83. Gov’t report: Health care deductibles higher under GOP bill

  84. Post-Brexit, Europeans More Favorable Toward EU

  85. AP-NORC poll: Most in US think Trump meddled in Russia probe

  86. Netflix Is Now Bigger Than Cable TV

  87. Good morning! 

    A month from today I'll be back from my vacation already – I think I need a longer one…

    /RB back to $1.46, /CL $44.90 with the Dollar back at 97 – gotta have faith in those manipulators.  Futures flattish but not impressive with the Dollar lower.  


    Turns out I nailed it on /NG – it's hard to take a profit on a run up but you have to know when you've made more money than makes sense:

    So now we get to come back in on the pullback again (maybe Monday).

    Check out yesterday's declining volume vs advance:

    Europe has been trending lower since the open after Asia had a weak finish:

    No particular news other than BOJ, which shouldn't have been a surprise.

    BOJ keeps policy on hold

    • The Bank of Japan kept its negative interest rates on hold in its June review, pledging to keep asset purchases around the current target of ¥80T ($727M) and sounding more upbeat on the economy.
    • "Private consumption has increased resilience against a background of steady improvement in the employment and income situation," the BOJ said in a statement.

    Southern California power supply at risk this summer, FERC says

    • Natural gas constraints in Southern California could pose a risk to the region's power supply this summer, while New England and Texas could face tight electricity supplies, according to the FERC.
    • The agency's summer reliability assessment forecasts power resources should be adequate to meet demand in most regions this summer, but restrictions at the Aliso Canyon storage facility could pose a risk to gas and electric reliability in Southern California, especially if hotter than normal weather conditions and unplanned gas pipeline outages materialize during the summer.
    • California state agencies have not allowed Sempra Energy's (NYSE:SRE) SoCalGas to inject gas into the facility since a leak that started in October 2015; FERC also says new regulations on gas storage facilities imposed by California likely will reduce gas flows.

    Booz Allen discloses DOJ probe; shares down 13% after hours

    • The investigation relates to certain elements of Booz Allen's (NYSE:BAH) cost accounting and indirect cost charging practices with the U.S. government.
    • Shares -13.15% after hours

  88. Phil,

    So are you out of all your /NG, /RB and /CL?

  89. Phil / Europe;

    If you stop by Barcelona, let me know!, you and your family will not regret (hopefully)