Archive for 2017

Weekly Market Recap Sep 10, 2017

Courtesy of Blain.

The holiday shortened week started with a bout of moderate selling but things were largely quiet in the indexes after that.   The debt ceiling turned into a nothing burger – we didn’t even get the normal rhetorical circus out of D.C. before they kicked the can forever down the road – boo!   So we’ll be back at it circa mid December when they wave their hands in faux outrage as they raise it again.

One note on the Federal Reserve – Vice Chairman Stanley Fischer plans to resign from his post in mid-October. His term was set to end in June.

Across the pond, the European Central Bank (ECB) left key interest rates unchanged, while Mario Draghi indicated that the decision on how to taper a quantitative-easing program will come in October.

Not much to note in economic news but Wednesday ISM services came in at 55.3 for August, compared with 53.9 in July – so a nice rebound there. A reading of at least 50 indicates expansion.

For the week the S&P 500 fell 0.6% while the NASDAQ pulled back 1.2%.

While the hurricanes are obviously terrible for those involved, they actually will be a boost to the economy as we move ahead.  That said google “broken glass fallacy” when you have a moment.

As devastating as the hurricanes are, they are likely boost the economy, according to New York Federal Reserve Bank President William Dudley.  “The long-run effect of these disasters, unfortunately, is it actually lifts economic activity because you have to rebuild all the things that have been damaged by the storms,” Dudley said in an interview with CNBC.

“I would expect that by the time we get to the end of the year and early 2018, the transitory negative effects of this storm I think will be over and we actually will start to see some of the benefits of the rebuilding efforts in terms of boosting the economy,” Dudley said.

Remember when everyone hyped the “strong dollar” Trump would bring post election?  Not so much – this past week was…
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Visualizing The Future Of Food

Courtesy of Zero Hedge

The urban population is exploding around the globe, and, as Visual Capitalist's Jeff Desjardins explains below, yesterday’s food systems will soon be sub-optimal for many of the megacities swelling with tens of millions of people.

Further, issues like wasted food, poor working conditions, polluted ecosystems, mistreated animals, and greenhouse gases are just some of the concerns that people have about our current supply chains.

Today’s infographic from Futurism shows how food systems are evolving – and that the future of food depends on technologies that enable us to get more food out of fewer resources.

Courtesy of: Visual Capitalist

 

THE NEXT GEN OF FOOD SYSTEMS

Here are four technologies that may have a profound effect on how we eat in the future:

1. Automated Vertical Farms

It’s already clear that vertical farming is incredibly effective. By stacking farms on top of another and using automation, vertical farms can produce 100x more effectively per acre than conventional agricultural techniques.

They grow crops at twice the speed as usual, while using 40% less power, having 80% less food waste, and using 99% less water than outdoor fields. However, the problem for vertical farms is still cost – and it is not clear when they will be viable on a commercial basis.

2. Aquaponics

Another technology that has promise for the future of food is a unique combination of fish farming (aquaculture) with hydroponics.

In short, fish convert their food into nutrients that plants can absorb, while the plants clean the water for the fish. Compared to conventional farming, this technology uses about half of the water, while increasing the yield of the crops grown. As a bonus, it also can raise a significant amount of fish.

3. In Vitro Meats

Meat is costly and extremely resource intensive to produce. As just one example, to produce one pound of beef, it takes 1,847 gallons of water.

In vitro meats are one way to solve this. These self-replicating muscle tissue cultures are grown and fed nutrients in a broth, and bypass the need for having living animals altogether.


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6 rules for rebuilding infrastructure in an era of ‘unprecedented’ weather events

 

6 rules for rebuilding infrastructure in an era of 'unprecedented' weather events

Courtesy of Thaddeus R. MillerArizona State University and Mikhail ChesterArizona State University

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Flooding from Hurricane Harvey. Can the region rebuild infrastructure so that it can better withstand extreme weather events? AP Photo/David J. Phillip

Before Hurricane Harvey made landfall on Aug. 25, there was little doubt that its impact would be devastating and wide-ranging.

Unfortunately, Harvey delivered and then some with early estimates of the damage at over US$190 billion, which would make it the costliest storm in U.S. history. The rain dumped on the Houston area by Harvey has been called “unprecedented,” making engineering and floodplain design standards look outdated at best and irresponsible at worst.

But to dismiss this as a once-in-a-lifetime event would be a mistake. With more very powerful storms forming in the Atlantic this hurricane season, we should know better. We must listen to those telling a more complicated story, one that involves decades of land use planning and poor urban design that has generated impervious surfaces at a fantastic pace.

As the Houston region turns its attention to rebuilding and other cities consider ramping up efforts to make their infrastructure more resilient, it is this story that can provide valuable lessons for policymakers, planners, engineers, developers and the public. These lessons are all the more important against the backdrop of a Trump administration that has stripped requirements for infrastructure projects to consider climate impacts and may try to offer an infrastructure investment package.

We draw from our research as a social scientist and an engineer and from our experience helping to lead the Urban Resilience to Extreme Weather Events Sustainability Research Network (funded by the U.S. National Science Foundation). Here are six rules for investing in infrastructure for the 21st century that recognize the need to rethink how we design and operate our infrastructure.

If we design with the technologies, needs and climate conditions of the 20th century, we will no longer serve society and the hazards we will encounter now and in the future.

A strong foundation

Proactive maintenance first. In 2017, U.S. infrastructure was given a D+ by…
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The Fed Has Lost The Market – Traders Abandon ‘Hype’ Of More Rate Hikes

Courtesy of ZeroHedge. View original post here.

Eurodollar options traders are abandoning positions targeting another Fed rate increase this year, as the market-implied probability of a quarter-point hike in December plunges below 25 percent.

The latest Chicago Mercantile Exchange data, for trading on Thursday, show a sharp drop in open interest for options that are a pillar of a December 2017 eurodollar put-fly position, a trade that hinges on the market pricing in a hike that month.

The liquidation signals the reversal of a position that was built up in June.

Futures positioning is also half what it was at the peak…

As hope and hype of continued rate normalization has collapsed for next year…

As perhaps the market ealizes, one more hike and the Fed-Funds-to-2Y curve will invert once again…

In other words, The Fed has lost the market.





To Find Leakers, Jeff Sessions Wants To Put Entire National Security Council Through Lie Detector Test: Axios

Courtesy of ZeroHedge. View original post here.

Having warned previously that the DOJ would crack down brutally on any current and future leakers, Attorney General Jeff Sessions appears ready to follow through with this threat, and according to Axios, he has told co-workers he is seeking to put the entire National Security Council staff through a lie detector test "to root out leakers."

While it is unclear if Sessions will follow through, the AG reportedly floated the idea to multiple people, as recently as last month.

As Axios details the upcoming crackdown, Sessions' idea is to do a one-time, one-issue, polygraph test of everyone on the NSC staff. Interrogators would sit down with every single NSC staffer (there's more than 100 of them), and ask them, individually, what they know about the leaks of transcripts of the president's phone calls with foreign leaders. Sessions suspects those leaks came from within the NSC, and thinks that a polygraph test — at the very least — would scare them out of leaking again.

Sessions has told associates he likes the idea of targeting the foreign leader phone calls because there's a small enough universe of people who would have had access to these transcripts. Also, the idea that the President of the United States can't have private conversations with foreign leaders was a bridge too far, even for Democrats.

Perhaps more than anything, such a dramatic turn of events by the DOJ, would demonstrate how frustrated he's become about the rampant leaking of classified information. Then again, as Axios observes, Sessions seems to understand that it's extremely tough to successfully prosecute leakers, especially when they are career intelligence professionals who are skilled at covering their digital tracks.





Decision Time For Tech and S&P

Courtesy of Declan.

The coiling setup from last week unwound itself with a move lower; whether markets have blinked and are ready for further losses or if this is just some ‘bear trap’ remains to be seen. The key test will be whether support from long established rising price channels will hold if such losses continue.




The S&P only posted a small loss and some may consider Friday’s action a shift in the coil position (use the 2-day high/low to define the trade and stop). However, the rising channel is very close and is in close proximity to the 20-day and 50-day MA.






The Nasdaq experienced a bigger loss than the S&P but has a greater number of support levels to work with; horizontal and channel support along with converged 20-day and 50-day MAs. One key difference to the S&P is the relative outperformance of Tech stocks to Large Caps. If buyers are to enjoy a boost then the Nasdaq may benefit ahead of the S&P.





The Russell 2000 is trading inside the prior range. After failing to follow through on the break below the 200-day MA it’s now building demand around its 50-day MA. I like the relative performance of this index; it’s caught inside a range and below moving averages which will keep it away from technical scans and the interest of most momentum/short term traders.  There may be one surprise in the bag – a duck-down-and-bounce off the 200-day MA would be ideal. One to watch.





Another index looking ready to crack is the Dow. Two prior tests of the 200-day MA failed to ignite a bounce and Friday’s third such test may be the one to break the camels back. Supporting technicals are weak and the index is exhibiting the weakest relative performance. Downside target is the 200-day MA.





For tomorrow, shorts should probably focus on the Dow, longs could perhaps fish GTC buy orders around the 200-day MA in the Russell 2000 in addition to playing a break above the 50-day MA.




You’ve now read my opinion, next read Douglas’ blog.




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Elon Musk Magically Extends Battery Life Of Teslas Fleeing Irma

Courtesy of ZeroHedge. View original post here.

In what is either a generous act of charity or an unnerving example of the control Tesla exercises over the vehicles it producers, or perhaps both, Tesla CEO Elon Musk has magically unlocked the batteries of every Tesla in Florida to maximize the distance that people fleeing from Hurricane Irma can travel before stopping to refuel at one of the company’s “superstation” charging centers.

Typically, these types of over-the-air upgrades can cost thousands – if not tens of thousands – of dollars.

But Musk is temporarily offering full battery capacity to all owners of Model S/X 60/60D vehicles with 75 kilo watt battery packs, according to Electrek, a blog that covers electric vehicles.

The upgrade will surely help Floridians who are still rushing to escape as the now category 3 storm makes its second landfall near Naples. The upgrade will last through Saturday.

As a Tesla spokesperson explained to Electrek, the company decided on the mass-unlocking strategy after a customer called and asked if the company could upgrade his battery because he was trying to flee the storm. Tesla’s Supercharger network is fairly extensive in Florida and most owners should be able to get by even with a Model S 60 (the shortest range option).

A Tesla Model S 60 owner in Florida told Electrek that his Tesla was getting 40 more miles without a charge after Tesla had temporarily unlocked the remaining 15 kilo watts of the car’s software-limited battery pack.

“The company says that a Tesla owner in a mandatory evacuation zone required another ~30 more miles of range to optimize his evacuation route in the traffic and they reached out to Tesla who agreed to a temporary access to the full 75 kWh of energy in the battery pack, an upgrade that has cost between $4,500 and $9,000 depending on the model and time of upgrade.”

The company also decided to temporarily unlock other vehicles with the same software-lock battery packs in the region.

Tesla’s supercharger network is fairly extensive in Florida and most owners should be able to get by even with a Model S 60 (the shortest range option), but sometimes that 30 more miles of range can make a big difference.

Most of the supercharger stations in the state are still open:

Though a handful in the effected area have closed…





Quiet Korea Sparks Panic Bid For Stocks, Dollar As Gold, Yen Dumped On Asia Open

Courtesy of ZeroHedge. View original post here.

The end of the world did not happen… Buy stocks, dump gold, and back up the dollar truck…

Safe-Haven precious metals, bonds, and Yen are for losers…

It's stocks you want…

And load up on dollars…





FX Week Ahead: It Could Be Time To Lay Off The USD A Little

Courtesy of ZeroHedge. View original post here.

Submitted by Shant Movsesian & Rajan Dhall MSTA at fxdaily.co.uk

It could be time to lay off the USD a little, but inflation midweek could delay any major correction.

After a week of arguing if the EUR is overvalued and whether the ECB will pinpoint this, we get back to the crux of the matter, which is USD weakness.  Across the spectrum, we have seen US Treasury yield pressed back to levels seen in the aftermath of president Trump's, victory, but we have had two 25bp hikes in the US since then and as such, reflation has been completely priced out and more.  Indeed the 2yr is now on par with current Fed funds, so on this basis, another Fed move by year end is also priced out, but futures markets are keeping a 25% probability on the table.  We still think at this stage, it is too low. 

As in the title, inflation numbers on Thursday will determine whether the odds can improve, and with plenty more data to consider until the December meeting, we see risk to the USD on the upside this week unless there is an outright collapse in CPI – which seems unlikely given extended weakness in the greenback in recent months.  Markets will be looking for the headline rate to see a modest pick up from Oil price, but the core rate may dip slightly. In either case, comparative levels of inflation are not as bad as hyped over, given we are not too far off the 2.0% target unlike Europe and Japan say. 

Little seen ahead of this other than the JOLTS job openings figure on Tuesday as well as the familiar precursor to inflation in producer prices on Wednesday.  On Friday though, we also get retail sales as well as production stats and capacity utilisation.  All the above are for Aug and will have some degree of flex (in response) due to seasonal factors – as we saw in the non farm payrolls report.

Another factor in the belief that the USD is near its lows – for now – is that so much bad news has been priced in – and we will refrain from referring to the devastating effects of the


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Goldman Slashes Q3 GDP By 30% Due To Hurricane Disaster

Courtesy of ZeroHedge. View original post here.

Yesterday, when commenting on the impact of Hurricanes Harvey and Irma, we noted that even before the two devastating storms were set to punish Texas, Florida and the broader economy, erasing at least 0.4% GDP from Q3 GDP according to BofA and costing hundreds of billions in damages (contrary to the best broken window fallacy, the lost invested capital more than offsets the "flow" benefits from new spending, which is why the US does not bomb itself every time there is a recession to "stimulate growth"), things were turning south for the US economy, which in turn prompted Deutsche Bank to point out that (adjusted) recession risk, at roughly 20%, is now the highest in the past decade, and that it was quite prudent for the Fed, which expects to hike rates at least once more in 2017, to pause its current tightening, especially since a period of both economic and market weakness is imminent.

It didn't take long for one of the most bullish on the US economy banks to follow in BofA's footsteps, and overnight in a note from Goldman's chief economist, Jan Hatzius, announced the he was slashing his Q3 GDP estimate by a whopping 30%, or 0.8%, to 2.0% annualized, to wit:

Given the potentially sizeable growth effects from Harvey—and with Irma risks now moving to center stage—we lowered our Q3 GDP tracking estimate by 0.8pp to +2.0%…

But fear not, because like all good Keynesian acolytes of the "broken window fallacy", Goldman is confident that the flawed perpetual engine of growth, namely destruction – after all, why else is the world's gearing for global war – will kick in, and more than offset the Q3 GDP loss, by boosting the next 3 quarters by a cumulative 1.1%:

… However, we expect this weakness to reverse over the subsequent three quarters, more than recouping the lost output. Accordingly, we are also increasing our respective quarterly growth forecasts by 0.4pp, 0.2pp and 0.4pp for Q4, Q1, and Q2, (to +2.7%, +2.5%, and +2.4%). We will revisit these estimates once reliable information about the toll from Irma becomes available. We stress that the overall impact of the hurricane


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Zero Hedge

Enemy Of The People?

Courtesy of ZeroHedge. View original post here.

Via The Zman blog,

There has never been a time when normal people did not know the media was biased and biased in a predictable direction. For every non-liberal in the media, there were at least ten liberals. The ratio was probably higher, but then, as now, some lefties liked to pretend they were independents or some third option.

The media used to invest a lot of time denying they had a bias and an agenda, but the only people who believed them were on the Left, which had the odd effect of confirming they had a bias and an agenda.

...



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Phil's Favorites

A 2019 Earnings Recession?

 

A 2019 Earnings Recession?

Courtesy of 

Shout to Leigh!

On the new Talk Your Book – Josh Brown is joined by Leigh Drogen of Estimize, one of the leading providers of crowdsourced financial and economic data to talk about the trend in corporate profits that could potentially lead to an earnings recession later this year.

What is the thing that Leigh is seeing in the data that Wall Street isn’t yet picking up on? What segment of the stock market is most at risk? Why is the crowd smarter than the narrow consensus of Wall Street analysts?

Check out Estimize ...



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ValueWalk

D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...



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Kimble Charting Solutions

Gold & Silver Testing Important Breakout Levels!

Courtesy of Chris Kimble.

Gold and Silver from a long-term perspective have created a series of lower highs over the past 8-years. Will 2019 bring a change to this trend? A big test is in play!

Gold since the lows in 2016 has created a series of higher lows, while Silver may have created a double bottom.

Gold & Silver are currently facing break attempts a (1) and (2). These falling resistance lines have disappointed metals bulls for the past few years.

The direction of Gold and Silver weeks and months from now should be highly influenced by what each does as they are attempting to break above important resistance levels.

To become a member of Kimbl...



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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ...

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Digital Currencies

Russia Prepares To Buy Up To $10 Billion In Bitcoin To Evade US Sanctions

Courtesy of Zero Hedge

While the market has been increasingly focused on the rising headwinds in the global economy in general, and China's economic slowdown in particular, while the media is obsessing over daily revelations that Trump may or may not have colluded with Russia to get elected, a far more critical, if underreported, shift has been taking place over the past year.

As we reported in June, whether due to concerns over draconian western sanctions and asset confiscations following the poisoning of former Russian military officer Sergei Skripal, or simply because it wanted to diversify away from the dollar, Russia liquidated virtually all of its Treasury holdings in the late spri...



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Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's failure based on his personality, which was evident years ago. This article, written in 2017, references a prescient article Bill wrote before Trump became president, in July, 2016, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

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

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

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

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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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.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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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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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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