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50 DMA Friday – S&P Struggles to Stay Technically Positive

Is overbought the right price now?  

Just a week ago, there were literally thousands of articles saying: "Well, of course we had a sell-off, the markets were so overbought it was bound to happen." Yet here we are, a week later and now they are saying what a great buying opportunity this is.  Seriously?  We're now only 5% below the "obviously overbought" market top.  What changed in the past 7 days?

The market has gone nuts since August, rising from S&P 2,400 to 2,872, which is a 20% run in 5 months.  Markets don't go up 20% a year, let alone in 5 months.  Hell, they hardly even go up 20% in two years and, of course, the logic is TAX CUTS – which seems to justify everything but let's consider that very few companies drop more than 20% to the bottom line (14.6% is the average) and that they are taxed on their profits, not their income so, even if the taxes were as much as the profits (they are about 20% of profits on average) and the taxes were eliminated ENTIRELY, then the companies would only make 14.6% more money.  

That is, of course, not the case and there is nothing in Q1's earnings or guidance to give any indication that the new tax law will have a serious effect on forward earnings – mainly because US Corporations never paid 20% taxes in the first place (about 13.5% on average).  So, if they actually paid the new 20% rate, it would be a tax INCREASE for those companies who routinely park their cash overseas or pay tens of millions of Dollars to accounting firms and Investment Banks to avoid paying Billions in taxes (Apple alone is bringing back over $200Bn they had stashed overseas).  

Trump is taking credit for repatriating funds from overseas but what he's really doing is giving companies a tax incentive (15%) for bringing back money they earned under the Obama Administration (because he was mean and would have taxed them) and for not paying their taxes under Obama's budgets.  In fact, Trump is REWARDING the corporations for hiding money from Democrats and letting future CEOs know that any time a Democrat tries to tax them – they are free to flaunt the law until a Republican is back in power to forgive them.   

Trump is also taking credit for the market rally, though the last couple of weeks finally got him to shut up about it.  As you can see from the chart on the left, which has been around for 100 years, there's nothing going on here that hasn't happened before and we had a late-stage parobilic move up, people got really excited and thought it would go on forever and now we had a sharp pullback and people are piling back in and here we are – at the spot labeled "Complacency" – making all the same mistakes we made just two weeks ago! 

As I noted in yesterday's Report, we amped up our hedges into the weekend and, this morning, I put out a note to our Members saying:

/YM is 25,300, that's my favorite short and we have /ES 2,740, /NQ 6,845 and /TF1,545 and my stop-outs are if we get over 2,750, 6,850 or 1,550 but, otherwise, I want to accumulate /YM shorts.  

The reason I'm skeptical of the rally is that we've bounced back on 1/3 the volume at which we sold off and forming a weak base is why we were shorting the market in the first place a few weaks ago.  Apparently, traders have learned nothing at all this month and we're right back to the madness of the Dow moving up 1,500 points on ridiculously low volume.  This is simply a lack of sellers at the moment and God help us all if they come back!  Here's the recent S&P ETF (SPY) volume:

Date Open High Low Close* Adj Close** Volume
Feb 15, 2018 271.57 273.04 268.77 273.03 273.03 103,991,400
Feb 14, 2018 264.31 270.00 264.30 269.59 269.59 120,735,700
Feb 13, 2018 263.97 266.62 263.31 266.00 266.00 81,223,600
Feb 12, 2018 263.83 267.01 261.66 265.34 265.34 143,736,000
Feb 09, 2018 260.80 263.61 252.92 261.50 261.50 283,565,300
Feb 08, 2018 268.01 268.17 257.59 257.63 257.63 246,449,500
Feb 07, 2018 268.50 272.36 267.58 267.67 267.67 167,376,100
Feb 06, 2018 259.94 269.70 258.70 269.13 269.13 355,026,800
Feb 05, 2018 273.45 275.85 263.31 263.93 263.93 294,681,800
Feb 02, 2018 280.08 280.23 275.41 275.45 275.45 173,174,800
Feb 01, 2018 281.07 283.06 280.68 281.58 281.58 90,102,500
Jan 31, 2018 282.73 283.30 280.68 281.90 281.90 108,364,800

Image result for house of cards animated gifThat's 1.5Bn shares on the way down from 275 (the low was put in on the 9th) and 480M on the way up – that's simply not at all good!  If you build a building with 1.5Bn bricks and someone knocks it down and then you rebuild the building with 480M bricks – is the build more or less sturdy now?  Like bricks, inflows form the foundation for price supports and, without them – you are looking at a house of cards.

Don't get me wrong, we were buying stocks right along with you as they went on sale because who knows if we'll see these prices again BUT we also put more money into our hedges so we're now better protected for the next drop and, if we don't get one, then we will do very well in our long positions (see yesterday's review of our Money Talk Portfolio).  

For example, I was reviewing our Options Opportunity Portfolio (OOP) yesterday and, as of 1pm, it was at $97,587 but, thanks to the ridiculous afternoon rally, the same exact positions popped to $103,550 into the close.  That's simply ridiculous, gaining $5,963 (6%) in 3 hours and, as I made many great speeches about earlier this year (and last) – it's logically unsustainable or everyone will be a Billionaire making those kinds of gains – and where would all this money be coming from?

Perhaps we will all be Billionaires if inflation keeps moving up.  Most people in Zimbabwe were Trillionaires when their currency collapsed, as were Germans after World War I and we have just the kind of burgeoning Fascist Regime to pull it off in the US as well!  Import prices were up 0.4% in January, setting a 5% annual pace and, ex-Agriculture, which has been weak, it was 0.9% – very Weimar indeed!  The Germans were brought down by war debts which caused huge deficits and rising interest was the nail in their coffins as the cost of servicing the debt became unbearable – pretty much what I was saying is happening to the US in Tuesday's Report

Also inflationary, Housing starts popped higher to 1.33M and that's good for the broad economy but very inflationary and still nowehere near our normal level of about 1.6M per year (think about how long it takes to replace 110M homes, not to mention population growth).  Overall, it would be a plus but now when you are running up $7Tn in debt to stimulate the economy.  At 3% interest, that's $210Bn a year in interest alone – enough give each home-buyer $150,000.  

So think about that, what would be a smarter stimulus, spending $7Tn to give tax cuts to people who don't need it and stomp all over the World with our armies or tell anyone who wants to buy a new home they can have $150,000 in cash?  You don't even have to give them the cash, just give them low-interest loans that make the mortages more affordable and you'll fuel housing growth.  Perhaps, since we're saving $6.8Tn AND $210Bn per year in interest expenses, we could also mandate that new homes come with solar panels, which will take pressure off the electric grid that needs $2Tn worth of repairs and that too would save the new homeowners money and would lower the demand for energy and reduce the cost for all of us.

Image result for republican clown partyYes, there are sensible ways to govern but you wouldn't know it from the pack of bozos we have in office now.  Do you want to stop Russia from interfering in the election?  Give all registered voters "VoteCoins™", blockchain tokens that they can then send to the candidates of their choice, fully traceable and verifiable and you'd have the added benefit of instant election results with no messy ballot and recount issues.  Give us just $1Bn and my team and I can have the system running in time for the November elections.  

There, what else needs fixing?  

We'll see if the indexes are going to be "fixed" today.  As I'm writing this (9am), we're up about $500 per contract on our /YM shorts already as we cross below the 25,200 line and now that's our stop to lock in $500 and make sure we can afford our Egg McMuffins.  Now we're playing for a sushi lunch!  The critical lines to watch are those 50-day moving averages which, as you can see on our Big Chart, are Dow 25,150, S&P 2,723, Nasdaq 6,612, NYSE 12,955 and Russell 1,547:

As of this morning, the NYSE and Russell (our broadest indexes) are below the lines, Dow and S&P are on the lines and the Nasdaq is off in LaLa Land – as it often is – especially after Apple (AAPL) has a good day.  Now that we're a bit lower in the Futures, we can cash in our gains on the Dow (/YM) at 25,150 (up $750 per contract) and /TF at 1,535 (up $500 per contract) and swtich to the Nasdaq shorts (/NQ) at 6,798.50 with a tight stop over 6,800.  Since they remain the highest over the line, they have the farthers to fall if everyone is giving up their 50 dmas today.

Meanwhile, nothing beats a good hedge but the time to add those was yesterday, when the market was going up – we got great prices yesterday because we took sensible precautions while others were throwing caution to the wind.

That's why we're going to have a great, non-stressful Holiday Weekend – no mattter how far we fall today.

Have a great weekend, 

- Phil

I will be giving a 4-hour "Master Class" on Hedging, Options Trading Strategies, Portfolio Management and Fundamental Analysis at the opening of the New York Traders Expo on Sunday, Feb 25th at 9am at the Marriott Marquis – so register now if you'd like to hear a lot more about these strategies and get our latest trade ideas.


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  1. Nothing says Bot Moves like 5000 point swings in 10 days:

    If Condition[200DMABounce] = True Then
    Else function(SELL,SELL,SELL);

  2. Now, that was courage as opposed to our spineless Congress and president:

    But Howard’s response to the shooting was about as different from Trump’s as you could imagine. In his first speech to Parliament after the shooting, just two days later, he called for Australian legislators to take up “the vexed issue of gun control,” and vowed to devote his premiership to the issue.

    “I will do all that I humanly can, as leader of the government, to bring about a significant improvement and to address some of the great deficiencies that exist,” Howard said.

    Howard made good on his word. In May, his government unveiled a controversial policy called the National Firearms Agreement that radically strengthened Australia’s gun laws. The NFA established a registry of all guns owned in the country and required a permit for all new firearm purchases. It also flat-out banned certain kinds of guns, such as automatic and semi-automatic rifles and shotguns.

  3. Good Morning.

  4. Good morning and wheee!

    "Slip kid, slip kid, second generation

    You're slidin' down the hill like me"

    Well I'm super-pleased with our Futures shorts, riding /NQ now after taking the money and running on /TF and /YM.  That's because /NQ fell below 6,800 and that was a really good stopping line while /TF and /YM didn't have any significant resistance above them so it was more likely I'd get a good chance to stop out on /NQ on a sharp reversal than /TF and /NQ and, when the Futures are jumping around like this – that's important.  

    Nikkei is happy about strong Dollar.  

    Next good cross (or support) is /NQ 6,780, /TF 1,535, /ES 2,725 and /YM 25,100 but they should all be bouncy for the moment – the question is – strong or weak?

  5. Good program StJ!  

  6. Phil -  like you, I think CHK is just too cheap.  They have some very valuable properties that they've demonstrated they can sell for very good prices.

    Bought 2K shares at 2.85.

    Sold 20 2020 3 calls for 1.05

    Sold 20 2020 puts for .53.

  7. At 25,250 I go back to accumulating /YM shorts.  

  8. Good, sensible spread, Albo but they don't pay a dividend so I would have gone with 40 $1.50 ($1.80)/$2.50 ($1.30) bull call spreads at 0.50 with the 20 short calls so you're in the $4,000 spread for about $500 vs $2,540 to make $3,460 at $3 on yours.  

  9. Phil – "Johnson should be pissed too – below Trump?"  

    Indeed, aside from FDR, the Johnson administration passed more legislation benefiting the 99% than any other President. Does one wonder why our Erotically Incontinent Libertine and his RNC ilk want to start by dismantling the Johnson Amendment?

  10. Trump could not carry Johnson's gym bag! You don't have to agree with all of Johnson's deeds or values, but he was not spineless or dumb!

  11. StJL – Indeed, and that would be jock strap not gym bag.

  12. Phil – You are the master and I am the pupil. 

    But I think I stand to make 6100 vs the 2540 ?

  13. Unfinished business…

    Phil – "I'm just saying you are looking backwards and it's not relevant as we're moving forward now.  I see real wage growth in Europe, Asia and US." 

    Again, I'm just saying both of your assertions above are incorrect, which I've proved both with US real wages here and UK real wages here.

    Phil – "If your answer to that is "I was only looking at the last two quarters" – then we have to get into a whole lecture on statistical sampling as well."

    No, I never said.

  14. The Jan SQQQ $30 calls have someone bidding $3.40!!

  15. Nevermind, looking at wrong thing.  Not very abnormal at all!

  16. RE- Chk- I read they sold the parcel for rock bottom prices 2k an acre. Shows the desperation of the situation? They should be able to come back, but like SHLD, too little to late? Without assets and pumping wells and enough profit….. I'm doing a small hedge but your BCS is already way down Phil. YEh?

  17. Boss, I going short FB.  The logic is FANG is over with.  F is going to be weakest link.  I'd like your thoughts as you are correct a majority of the time.  

  18. Finishing up from yesterday…


    Phil – "Also, inflation adjusted wages don't need to go up. As long as the consumer is generally keeping up with inflation"


    Oh munificent one, as you well know real wages are a guide to how living standards have changed. If real wages are stagnant or decline, so does said living standard.  Given that advertised inflation is severely understated, to anchor the lemmings expectations, this often means that prices are rising much faster than wages, and one is constantly worse off. 



    Ask anybody who is "generally keeping up" with understated inflation, winds up reliant on SS and eating from a Le Chat or Monge buffet.  The above is something that Philip Davis or The Prince Against the War on the 99%, the wage squeeze, and the decades long screwing of John Q, knows and rants about quite often.


    And it is that Brother Phil whom we hold to a higher standard. So how could he say, real wages don't need to go up? Time for Lil Friskies? or should I be asking this?  and Out


  19. Pirate – My comment on asset sales was following reading a report from Southeast Asset Management, who own 3.6% of the stock.  Of course they could be talking their book !

    "~Overshadowing strong operational
    performance by CEO Doug Lawler and his management team,
    domestic gas oversupply weighed down strip prices. Chesapeake
    made progress delineating some of its newer plays, but the
    market continued to underestimate the company's ability to sell
    meaningful assets, as it has done multiple times in the past.

  20. All the indexes straight up like a rocket launch? Amazing. Nat you are so right. Then when inflation, which is way up in some sectors like RX, medical care, petrol, heat for homes etc where do you cut expenditures? I have heard of well off people who became ill and their entire retirement savings of hundreds of thousands was gone within a year! All investments, all savings yet their taxes, insurance and meds NEVER go down, ever.

  21. Social Security is a joke and so is Medicare. All the medical are nothing but blood suckers of the desperate. Finding honest help is practically impossible. They have a script and they follow it. My good friend, who was diagnosed with stage 3 melanoma on her leg was told by her MAYO doc Not to take a multivitamin because "it doesn't help." I was so shocked when she told me. I told her I had been taking them since I was 20 years old and they have done right by me. They put her on chemo, radiation and all the other poisons instead of amputating her leg so she would at least have had an immune system left. Seeing her go through such hell and then of course the cancer spread through her whole body was sickening. It took her 4 years to finally leave this earth but her life was not worth living for years. Couldn't even have her friends by her side and of course the finances of her husband was depleted completely. This is American, home of the brave with their AR"S blowing apart children and family's to make it complete.

  22. This market seems invicinble. And I cannot go bullish. The way it just shot up on low volume, it just felt fake for me…

  23. Phil// Question about FMCC – Recently the stock has been in a steady decline.  Is it worth looking at for a long term play?  Thanks.

  24. Long-Term Portfolio Update (LTP):  $525,741!  Not bad for our first month, up 5.1% ($25,741) after being down more than that on the dip.  Since the STP is up another $17,000 and we no longer have that SVXY debacle to drag us down – I'm sure, after yesterday's adjustments, that we're in good shape – even if we have another move down.  

    We're not looking to make huge money in the LTP but we did get lucky on a couple of positions and we had the foresight (balls) to improve some of our positions when they got cheaper.  That's the whole point of hedging, of course – to put cash in your hands while the stocks are getting cheaper so, instead of freaking out and cashing out our losers – we are able to reposition our "temporarily underperforming trades" to take advantage of the next move up.  

    Within that context, however, is the discipline of vigilance – which takes the form of these monthly reviews where we check our premise and check our progress to make sure we're not throwing good money after bad and to make sure we're not being greedy on a position that has already run it's course.

    Short puts are all fine except: 

    • SKT – Well this is why we sell puts – to keep an eye on stocks we REALLY want to buy if they get cheaper.  We sold the 2020 $22.50 puts for $2.70 so $20 is our dream price but $22.50 is our target entry for a long spread.  Since SKT pays a lovely 5.84% dividend of $1.37, we're going to buy 2,000 shares of the stock for $22.25 and we're going to conservatively sell 20 of the 2020 $20 calls for $4 as those, along with the short puts, give us a net entry of $15.55 so, even if we have to buy another 2,000 at $22.50, we'd be in 4,000 for $19.025 and then we'd sell more puts and calls for $6 and have a $13ish basis so it's almost better if they tank first, right?  If not, we'll collect ($2.74 x 2,000) $5,480 in dividends and be called away at $20 for another $8,900 profit which would be a gain of $14,380 against our net $31,100 entry so good for 23% a year on this boring play.  

    • FTR – It's so confusing when they are winning. Now I wish we had more but, oh well. 
    • ABX – So undervalued!  We're not far off flat and our longs are already the $10s so nothing really to change.
    • ALB – Wow, they really flew up.  We're at $13,550 off our net $8,000 entry but it's a $30,000 spread and I was confident enough when we jumped in that I only 2/3 covered the long calls 
    • ALK – Love those guys.
    • BBBY – Another one I love.  
    • C – Got cheaper, good for a new trade but too soon to press.  We expected that pullback, that's why we were bullish on FAZ as a hedge (now off).  

    • CBI – Another one I'm simply tired of banging the table on.  Good for a new trade.  
    • CDE – Making up for ABX's slow start.  Same premise.  
    • CHK – Good for a new trade.
    • CMG – So glad we uncovered those!  They are going to pause at $300 but I think they bust over and we'll cover around $330.  

    • F – A stock!  We're in this one for the dividends.  Good for a new trade.
    • FNSR – They went totally out of favor and we already doubled down on the $15 calls so we'll just have to wait and see.  So far, we bought back the short calls for a $7,950 profit so we're in for net $27,000 so our break-even is about $20 but right now we can (but we're not) sell the 2020 $20 calls for $4.50 ($9,000) which would drop out net to $18,000 with a $7,000 profit (38%) at $20 and that's AFTER the stock dropped 20% on us.  This is why I love option spreads!  Meanwhile, I think we can do better than that, maybe we'll sell the $25s for $4+ (now $3.05) and that will then give us room to sell some short-term calls while we wait to see if we get $50,000 back on our $15/25 spread.

    • GE – Another one I'm simply bored banging the table on.   Put it under your pillow and check on it in July 2019.
    • HMNY – They just diluted the crap out of shareholders so, if we want to stay in, we should buy more.  Let's just shut this position down and change it to the following:  Buy 50 2020 $2.50 calls at $2.40 ($12,000), Sell 20 2020 $7.50 puts for $4.10 ($8,200).  That will be net $3,800 plus the $2,200 we lost on the first spread puts us in for $6,000 on 5,000 $2.50 calls so our break-even is $3.70 – as long as we're over $7.50, of course.  Counting the short puts, our break-even is below $5, where we'd be down $5,000 on the puts but up $6,500 on the calls – maybe.  
    • HRB – I love these guys every spring.
    • IMAX – About to have a huge weekend with Black Panther.
    • SPWR – We just adjusted these and going well already.  

    • THC – Blasted up to our goal already.  
    • WPM – Last year's Trade of the Year is still good for a new trade. 

    While I've been writing this the market pushed back up and the portfolio is now up 7.3% at $536,553 so up $11,000 while I'm writing it and we still have $413,673 (80%) of our CASH!!! on the side using $464,500 (25%) of our margin.  I guess, on the whole, I'd still rather the markets drop 20% than go up 20% so we could load up on cheap stocks but, as you can see already – every earnings Qtr we get a lot of chances to buy stocks cheaply and the positions we have are already going to give us all the returns we need for a $500,000 portfolio – the rest is going to be gravy.

  25. We missed the /RB train today

  26. Pirate/Medical-sorry about your friend.  What is really distressing is when you read Memorial Sloan's website, you see all the research they have done that proves alternative treatments for cancer work.  However, when you speak to the staff privately, they will tell you chemo and radiation are still done because they make money on it.  Standards of care in medicine were instituted by the MBAs and lawyers to limit liability.  They often preclude effective care and careful diagnosis and treatment.  

  27. /KC – are we liking coffee down here?

  28. Pirate, I'm sorry about your friend.  Melanoma is a very challenging malignancy to treat and has poor survival when advanced.

    Seer, I'm not sure where you're getting that information.  Please remember that research and proof of effective therapy are related but not the same. If you are going to make wild assertions please feel free to include the actual data or "proof" that supports your claim.  Chemo and radiation are mainstays of cancer treatment BECAUSE they have been studied AND proven to affect survival for a variety of malignancies – and of course research is ongoing. You can't just sit at your desk and look at google to start practicing  medicine or reach some sort of peculiar conclusion about cancer treatment. 

    With regard to standards of care in medicine – it's clear that you don't read any medical journals.  If you did, you'd know that "standards" are defined by clinical research – not billing, not MBA's, not attorneys.  The actual delivery of medical care, that's a different story – unfortunately that is influenced by more than just research or "standards" and for all (including those delivering care) it is particularly frustrating - perhaps that is what you meant to suggest. 

  29. /KCH8 (May) down to $1.21 and you know I'm buying.

    $6,100/Albo – Hmm, maybe it's me but if you bought 2,000 shares for $2.85 ($5,700) and you sold 20 $3 calls for $1.05 ($2,100) and 20 puts for 0.53 ($1,060) then you are in for net $2,540 and, if you get called away at $3, you get $2,000 x $3, which on my abacus is $6,000 for a profit of $3,460 but please – explain to me how that becomes $6,100 as I'd love to learn that trick!  cheeky

    Wages/Naybob – So you've proved it with the figures I've already disputed?  OK then….

    Working for a rise, better my station

    Take my baby to sophistication

    Seen the ads, she thinks it's nice

    Better work hard, I seen the price
    It's no good for man to work in cages
    Hit the town, he drinks his wages
    You're frettin', you're sweatin'
    But did you notice, you ain't gettin'
    You're frettin', you're sweatin'
    But did you notice, not gettin' anywhere

    CHK/Pirate – I was not happy with their last sale but bills were due and they had to sell something.  Overall, I believe LNG exports drive prices up faster than they can go bankrupt…

    Image result for lng exports


    Image result for lng exports

    Image result for lng exports

    FB/Thatway – Wow, I don't have the balls to bet against a company with 3Bn regular users.  Unlike AMZN or NFLX (who I'm also scared to short) FB makes real money and revenues were up 50% from 2016 and projected to be up 33% in 2018 and another 27% in 2019 while profits are on about the same path.  I guess your premise can be growth is slowing but that doesn't mean I'd short a company at $520Bn ($179) that's making $21Bn now and projects $26Bn next year – not when I can short TSLA instead!  

    Year End 31st Dec 2012 2013 2014 2015 2016 2017 2018E 2019E CAGR / Avg
    Revenue $m 5,089 7,872 12,466 17,928 27,638 40,653 55,370 70,016 +51.5%
    Operating Profit $m 538 2,804 4,994 6,225 12,427 20,203     +106.5%
    Net Profit $m 53.0 1,500 2,940 3,688 10,217 15,934 21,609 26,746 +213%
    EPS Reported $ 0.015 0.60 1.10 1.29 3.49 5.39     +225.4%
    EPS Normalised $ 0.015 0.60 1.10 1.29 3.49 5.39 7.26 8.82 +225.4%
    EPS Growth % -95.3 +3,935 +85.2 +17.1 +170.2 +54.3 +34.6 +21.5  
    PE Ratio x           33.4 24.8 20.4  
    PEG x           0.96 1.15 0.93

    Wages/Naybob – It's not a discussion about whether the proles are worse off, it's about whether it's logical to bet on inflation boosting the markets.  You're trying to make a point that has nothing to do with our discussion on wages in relation to investing (this is an investing site, you know).  

    Minimum hourly wage of workers in jobs first covered by
    Effective Date 1938 Act 1 1961 Amendments 2 1966 and Subsequent




    Oct 24, 1938



    Oct 24, 1939



    Oct 24, 1945



    Jan 25, 1950



    Mar 1, 1956



    Sep 3, 1961




    Sep 3, 1963



    Sep 3, 1964




    Sep 3, 1965




    Feb 1, 1967





    Feb 1, 1968





    Feb 1, 1969




    Feb 1, 1970




    Feb 1, 1971




    May 1, 1974





    Jan. 1, 1975





    Jan 1, 1976





    Jan 1, 1977




    Jan 1, 1978

    $2.65 for all covered, nonexempt workers

    Jan 1, 1979

    $2.90 for all covered, nonexempt workers

    Jan 1, 1980

    $3.10 for all covered, nonexempt workers

    Jan 1, 1981

    $3.35 for all covered, nonexempt workers

    Apr 1, 19904

    $3.80 for all covered, nonexempt workers

    Apr 1, 1991

    $4.25 for all covered, nonexempt workers

    Oct 1, 1996

    $4.75 for all covered, nonexempt workers

    Sep 1, 19975

    $5.15 for all covered, nonexempt workers

    Jul 24, 2007

    $5.85 for all covered, nonexempt workers

    Jul 24, 2008

    $6.55 for all covered, nonexempt workers

    Jul 24, 2009

    $7.25 for all covered, nonexempt workers


    That sucks Pirate.  They whole system sucks.  

    Fake/Roamer – It certainly does seem fake but they want to paint a pretty picture into the long weekend to get China excited when they come back.

    FMCC/Rookie – I like them but they are still giving all their profits to the Government.  People are freaking out now because they had a loss for the first time in ages (due to tax law changes, nothing wrong with the business) and now they need $6.5Bn back, so probably a good time to get in but risky because they could be regulated out of existence if Trump wakes up on the wrong side of bed.  

    /RB/Jeff – I was busy on the /YM train.  

    I tend to focus on whatever is the most obvious play of the day.  /RB was unpredictable and we already made our easy money there, the Dow seemed way overbought at 25,300 and ripe for a plunge (and now I'm back in with 3 more shorts).

    /KC/Tshroy – Yes.

  30. JO  / coffee

    just the last two days there have been over 5500 June $16 puts bought

  31. Phil, do you think China will start bringing us back down next week? I really thought at the very least we would be creating trading range lower, but it looks like we're headed back to test the highs. No testing of the lows?

  32. Phil-Sorry for the rant, but thanks for the kind words. I have a friend who works for a Doc and she is the oncology nurse. She said radiation makes $ for the Doc and herself, she made good wages, but it was a total waste. All her clients died within 3-6 months, but the new ones kept coming  because they were "told" it was their only hope. Seer, I appreciate your thoughts and I agree that alternative medicine is viable BUT I have to say when I needed help previously (years ago) I was fortunate to find some Princes and Princesses who helped me. AND I did access some alternative help also. It just seems now it is much more difficult for everyone to garner the intelligent help they need and are dying needlessly when their life's can be prolonged and worthwhile.

  33. UNG in buy territory. I have 1500 shares that I have been selling short calls against whenever it spikes higher. Also have 15 2020 $20 short puts. What further strategy would you suggest?

  34. Phil – CHK    I misread your post.  I thought you were saying that I'd get back 3460.  I'll get back 6100, of which 3460 is profit.  My bad !

  35. Phil, what’s your /YM position now? 

  36. Jeffdoc – it is interesting that the "placebo effect" is a thing – like it really works. But it's weird because it really cannot be explained why. A lot of alternative therapy is focused less on physical care, which to your point is scientifically unproven, but on the individual who benefits from the positive mental effect. I'm not a doctor, armchair interent doctor or otherwise, by any stretch of the imagination, but I'm looking into something personally so this side of the conversation is very interesting to me right now.

  37. AKS -Up sharply. :-)

  38. I've noticed during the healthcare debate that some of the same people that say the healthcare industry is "only in it for the money" are some of the same people that say the magic hand of efficient, free-market capitalism produces maximum benefit for society as a whole. There's probably some truth to that cutting both ways.

    Stee Jobs had no less than billions of dollars and sucummbed to cancer too at 56. He had a rare pancreatic cancer diagnosis around age 50 and managed to run Apple for the next 6 years while getting treated, including a liver transplant, before dying. There are some things that money just can't buy.

  39. Albo – AKS this why? 

    So the infrastructure plan spending will go to Trump's friends and not the most competitive priced steel.


    Commerce Department recommends major tariffs on steel and aluminum

    Steel and aluminum shares are rallying as the U.S. Department of Commerce recommends tariffsX +12.7%, AKS +12.2%, MT +3.3%, NUE +4.8%, STLD +4%, CLF+5.9%, CMC +5.4%, RS +2.4%, WOR +2.2%, TS +3.7%, AA +4.7%, CENX +8%, KALU+2.2%.

    The DoC recommends a 7.7% tariff on all aluminum exports, with higher duties of 23.6% on products from China, Russian, Venezuela and Vietnam.

    The Department also recommends global steel duties of 24% on all imports, with a ~53% tariff on steel imports from Brazil, China, India, Russia and several other countries.

    Pres. Trump has until April 20 to make a final decision.

  40. Learner – AKS was strictly by the chart.

  41. Bio-I was interested in Steve Jobs and his fight to survive too and actually used it to help family members get a grip on what "magic" mushrooms and alcohol  and other drugs can do to the body. Specifically the damage caused and in many cases not repairable. He had all the money needed for the best cures which didn't ultimately help him survive. It actually made an impression on the "no it all" mindsets, thankfully.

  42. GNC  25,000 lot trade in the Jan19 $2.50 puts for .60

    CSCO ( subject of Phil's comments the other day )  2000 lot sale of the 2020 $42 puts for $4.65

    Phil, is this a good sale considering the buybacks announced?

  43. Phil – Someone actually calculated how much electricity we could generate by covering all our roofs with solar panels:

    In total, they estimate that there are a little over 8 billion square meters of suitable roofs in the US. Cover that in solar panels, and you would produce about 1,400 terawatt hours of electricity each year—about two-thirds of which would come from small residential buildings. The total production is equal to nearly 40 percent of the total electricity currently sold by utilities in the US.

    That might enough for residential needs! Add some wind, dams and some other renewables and we are fossil free for electricity.

  44. Yes albo, i was just mentioning the reason AKS  and other steel names shot up.  Good for you on the trade!

  45. With an 87% 5 year survival rate, I felt Steve Jobs just played it too smart, the guy with all the answers.

    Sucks for his family, he could still be here today….

  46. Pirati – "Nat you are so right…. I have heard of well off people who became ill and their entire retirement savings of hundreds of thousands was gone within a year!  Social Security is a joke and so is Medicare. Finding honest help is practically impossible. This is America, home of the brave."

    Thank you for the kind words. Sorry to hear about your friend, went through similar with several. Sad but true, your "story" has become legion in our once great country.  This crumbling empire will eventually be brought to its knees by traitors, turncoats, idolators of false profits and anyone willing to sacrifice our future on the altar of money.

  47. BDC / Placebo;


    I had an intense discussion about "placebo effect" with my daughter  who is Ph.D. in molecular biology…and she is intense, also about cytotoxic compounds (chemotherapy), cancer has no magic bullets, no alternative therapies or things like that most of the stage III patients are in a special physiologic stage because they can accept snake venom or eating carrots all day (like Steve Jobs), the Science behind chemo and radiation is proved (I´m an example), the only other alternative is prevention and early detection.

    In the future the trend is creating specific treatments based on the individual genetic code, using antibodies or modifying conditions that will create a problem in the future (Angelina Jolie tits for example), at the moment is what is available.

    The placebo effect is real but is to disperse and random to rely a therapy on it.

  48. Well it's another INcredible rally on no volume.   

    LTP now up $54,153 – so good for $25K on the day.  That's perfectly normal, markets must be very stable…

    Oh, look at the VIX – yep, very stable, no volatility here… 

    China/Roamer – No, they come back from their vacation and see our market made a huge recovery – should be bullish, if anything.  

    Help/Pirate – I wanted to set up a company that acts as legal advocates for critical care patients in dealing with doctors and insurance.  The problem is, each person goes through this and maybe with their family but it's all unfamiliar territory and, of course, the nightmare of getting your insurance company to pay and approve.  I thought maybe something that was $50-100/month like an insurance rider and we'd have a team of experts to guide people through the process and deal with all the paperwork, etc.  I figure it's worth people paying 10% more for their insurance to insure that it's actually going to pay off if they do get sick.  Couldn't get it funded at the time (1990s) but I've always wanted to come back to that idea – certainly the need is still there.  

    UNG/Den – Well you can sell the 2020 $23 calls for $3.70 and that's more than 15% off the table and still 10% upside and it doesn't stop you from selling short calls while you wait. 

    Bad/Albo – Very!  

    /YM/Jeff – I let the 3 short ride and I've added 2 more since for 5 short at 25,344 avg and I'd like to be back to two short into the weekend but now I"m adding /TF shorts at 1,550 too so 2 of those I guess also.  

    Something about indictments in the Russia investigation is happening.

    New indictments coming from Russia probe: Grand jury returns indictment against 13 Russian nationals and three Russian entities accused of violating federal laws in order to interfere with U.S. elections and political processes, according to Mueller's office

    Day 387

    Walls: 0

    DACA fixes: 0

    Obamacare repeals: 0

    Tax returns released: 0

    Biggest Dow falls: 2

    Government shutdowns: 2


    4 Golf trips: 93

    Yearly budget deficit: $1 trillion

    Security clearances: temporary

    Team name: White House Wife-Beaters


    So much winning

    Great Daily Show summarizing Russian Scandal to date.

    Placebo/StJ – I think a lot of things can trigger your body to do it's job.  I think one reason musicians stay young longer is they are still doing the same thing they did when they were in peak shape.  Bodies have amazing abilities to heal and rebuild, they just forget at some point and some things, like placebos or going to vacation spots they enjoyed when they were young and healthy - can remind them.  

    Image result for placebo domingo

    CSCO/Stock – They will probably do well but I don't like what they are doing and wouldn't get in myself.  

    Solar/StJ – I've been saying that for years.  In fact, it's part of the proposal I gave to Geithner when we had that meeting at Treasury.  Could have had the whole project done by now.  

    Jobs/1020,Pirate – My understanding was he messed around with alternate medicine too much in the early stages and could have done better if he went right for transplant.  Still, you never know as different people have different responses to various treatments – something they are trying to narrow down with DNA analysis.  

    And what Advill said!  

  49. Nice move back down, I'm back to 2 short on /YM and /TF now – all bonus money at this point.  

  50. Now just the /TF as I made a quick $1,000 on /YM.  

  51. Still amazes me that LMT and BA stock price were not affected by Space X new rocket…same with EADS, the Russian company has no commercial flights booked for this year.

  52. LMT/Advill – Well they have a lot of other stuff going on.  I don't think rocket launches are a big part of their revenue stream though, in the future, they might become one.  

    Must be their low real wages:  Consumer sentiment blast through estimates
    • February Consumer Sentiment99.9 vs. 95.4 consensus and 95.7 prior.
    • Current economic conditions 115.1 vs. 112 consensus and 110.5 prior.
    • Index of consumer expectations 90.2 vs. 84.5 consensus and 86.3 prior.
    • Riot Blockchain (NASDAQ:RIOTplunges 21.9% after a CNBC investigation into the vet product company adding blockchain to its name and profiting.
    • Riot started out as Bioptix, which had a vet product patent, before making a cryptocurrency exchange investment and then purchasing a crypto mining equipment company. Riot paid $11M for $2M in equipment, according to filings.
    • CNBC says this isn’t Riot’s only “questionable” behavior: “A number of red flags in the company's SEC filings also might make investors leery: annual meetings that are postponed at the last minute, insider selling soon after the name change, dilutive issuances on favorable terms to large investors, SEC filings that are often Byzantine and, just this week, evidence that a major shareholder was getting out while everyone else was getting in.”
    • Read the full investigation here
    • The total U.S. rig count remained flat at 975 following last week's jump of 29, according to the latest weekly survey from Baker Hughes.
    • The number of active oil rigs rose by 7 to 798 after last week's increase of 26, while gas rigs gave up 7 to 177.
    • Exxon Mobil (XOM +1.2%), Total (TOT +0.8%) and Oil Search (OTCPK:OISHF) likely will give the go-ahead by next year to commit more than $6B toward adding liquefied natural gas export capacity in Papua New Guinea, Nikkei Asian Review reports.
    • The three companies control the undeveloped Elk-Antelope gas fields project in the country, and analysts expect them to present a plan to integrate the facility with the existing XOM-operated PNG LNG export plant as part of a cooperative approach to save costs instead of being a standalone facility.
    • Papua New Guinea's total proven gas reserves stood at 7.4T cf at the end of 2016, but some analysts estimate that the country's gas resources are enough to support expansion of export capacity from 6.9M tons/year currently to as much as 20M tons/year within the next decade.

    • Uber (Private:UBER) could sell its Southeast Asian business to rival Grab for a stake in the company, according to CNBC sources.
    • Uber previously sold its Chinese operations to rival Didi for a 20% stake and merged its Russian business with Yandex for a 37% stake. 
    • The deal isn’t finalized, but sources say making the deal could help Uber minimize costs to prepare for a possible IPO next year. 
    • In other Uber news, Quartz reports that Alphabet’s (GOOGGOOGL) Waymo is planning a competing ride-hailing service with autonomous vehicles. 
    • Waymo has tested the self-driving car service in Phoenix since last April.  
    • Previously: Uber settles with Alphabet's Waymo for $245M (Feb. 9)
    • Previously: Uber driving toward profitability? (Feb. 14)
    • Guggenheim lifts Wendy's (NYSE:WEN) to a Buy rating from Neutral.
    • The analyst team thinks valuation is attractive again on Wendy's after the recent decline in share price, noting that Wendy's trades with an implied free cash flow of +7% based on 2019 estimates.
    • Guggenheim expects the margin improvement at Wendy's to continue.
    • Shares of Wendy's are up 5.10% in premarket trading after the company set a new $175M buyback program and hiked its dividend.
    • Previously: Wendy's sets new $175M buyback program (Feb. 16)
    • Helios and Matheson Analytics (HMNY -7.3%) announces that its ownership stake in MoviePass is now up to approximately 78%.
    • The company says the increase in ownership stems from cash advances provided by HMNY to MoviePass from December 19, 2017 through February15, 2018 to support MoviePass’ working capital and operational requirements.
    • The total amount advanced by Helios to MoviePass during the period detailed  totaled $45.525M.
    • "We could not be more thrilled to hold a bigger stake in MoviePass, as the MoviePass phenomenon has become a major disruption to the entertainment industry,” says Helios CEO Ted Farnsworth.
    • Source: Press Release

    GBH sets Apple target at 18.5% upside

    • GBH Insights sets its Apple (NASDAQ:AAPL) price target at $205 (18.5% upside to yesterday’s close) citing the upcoming buybacks, a growing services business, and strength in China.
    • Analyst Dan Ives says the “March guidance hangover appears to have dissipated” and estimates that Apple has about 350M iPhones in the “window of opportunity” to upgrade in the next 12 to 18 months.
    • Ives expects three new iPhones this year that could capture customers scared off by the premium iPhone X.
    • The analyst predicts the services division (Music, Care, and App Store) will hit $50B in annual revenue by 2020.
    • Apple shares are up 0.9%.

  53. /DX popping 89.  Might put a bit of pressure on the indexes if it goes higher.  

  54. Coca-Cola sales beat as consumers drink more vitamin water, coffee

  55. Billionaires gone wild

  56. ‘Oh God, What Happened Last Night?’ Says Groggy Mike Pence After Waking Up In Same Bed As Wife

  57. Phil / AAPL- I'd like to sell some short term calls on I'm thinking of going with the Jun 180 calls at 180?  do you see anything more attractive?

    This is to cover some short 145 Puts as well as partial coverage on '20 160 long Calls.

  58. Phil – So you've proved it with the figures I've already disputed?  OK then….

    Well bless your little heart, I love that ATL Fed chart showing MEDIAN wages (50% above/below, not inflation adjusted or the best of measures). That 90 DMA chart in obvious decline since 1998, still at a level below 2009, increasing from 2010 till Q12016, and declining since. That teenie weenie uptick of late, (smaller than the Rotten Orange Fucknut's hands) and not confirmed through real wages, will probably be adjusted down (much like him) at a later date, they do it all the time. For now it's just happy daze kool aid for the Paxil at lunch bunch. Out.

  59. That’s a good idea Phil you should set it up

    legal advocates for critical care

  60. Running through my positions I see that I have a SQQQ Jan 2020 $20-$30 BCS.  Can't believe it, I must have incorrectly put in my order.  Very stupid.  It I paid $1.90 for the spread…..  Thoughts on rolling in back to the 2019?

  61. The DOJ announces the indictment of Russians for elections hacking and the market tanks! Trump now has his own guys confirming that Russia did help turn the election in his favor. I guess we'll see angry tweets tomorrow about fake news!

  62. i would have thought that would help gold?

  63. Gold/Jabo - you're not trying to think rationally about any of this, are you?

  64. scottmi--don't know how ;-)

  65. Jeffdoc-your accusations that my assertions are wild and I have never read a medical journal are ad hominem attacks that demonstrate the weakness of your argument and possibly bias.  They also make me wonder if you have had many frank conversations with many high-level executives and lawyers who run these businesses (that’s not an attack on your intellect or accomplishments).  There is a wealth of clinical research on MSKCCs website that demonstrates my point.  Some of the trials are sufficient for them to begin using some of these treatments and certainly provide more of a basis than some modalities that have been used in the past.  I reference MSKCC because I have an intimate knowledge of their operation and many relationships there, but similar research has been done elsewhere.  I know many of your colleagues at MSKCC disagree with your position as well.  Perhaps you don’t consider them your colleagues and question their credentials and skills because they disagree with you.  

    Pirate-agreed that there are some good people in the system.  I am certainly not looking for alternative care when I’ve been in an accident and need a surgeon.  However, it is a for-profit system and many new treatments are suppressed because of money.  The drag on the economy and toll on humankind are clear. 

  66. AAPL/Batman – I'd sell 1/3 the April $175s for $5.85 as you can do a 2x roll to the $185s ($2.25) or, of course, longer months and you'd still be just 2/3 covered and, on the way down, you have $2 per long protection, which is enough to pay to roll the long calls down $5.  June $180s pay $6.65 for twice as much time and through April earnings – so many ways to burn you.

    Advocates/QC – Need a VC willing to back it.  Would be a huge undertaking but a good deed for society.  The problem is it's my idea but I'm not an expert in insurance, law or medicine so I can't pilot it through and I started my Real Estate Data Company soon after and then I sold that for a bunch of money, got into trading again and never got back to it (those damned kids were distracting too!).  Maybe when our Hedge Fund gets bigger we can put a team together…  

    SQQQ/Knight – Not stupid at all, we added that to our OOP but it was in preparation to take profits on another spread that was already in the money, so mainly a backstop as we dismantled the initial hedge.  Nothing wrong with paying $1.90 for a $10 spread and don't forget SQQQ is a 3x inverse long to the Nas at $17 so a 20% drop in the Nas would be a 60% gain in SQQQ to $27.20 and you'd be $7.20 in the money.  If you want to make it primary protection, the 2020 $20s are $4.90 and you can roll them to the 2019 $15s at $4.60 and you don't have to move the short calls because you are deep covered until Jan and the 2019 $30s are $2.20 (1/2 of the 2020s) so either SQQQ goes up and you are well in the money on your long calls or it goes down and the 2020 $30 calls lose at least half their value, which is as much as the total value of the Jan $30s.  

    Tank/StJ – Not much of a tank, ran right back up.  I think people are happy the Russians are controlling our Government – better than Trump!  

    Treatments/Seer – There is, of course, a lot of quackery too and there would be a lot more if we made it easier (and more profitable) to provide "alternate" treatments.  I'm not saying some aren't valid but I think there should be more work done on a validating process and then have rules that make insurance companies treat validated alternatives as coverable instead of leaving it up to their discretion.  

    There's something else we need to do in this country and that's get people to learn to accept the fact that some things can't be cured and it makes no sense to prolong people's lives just for the sake of it.  We waste so much money and resources trying to give critically ill people a few extra months and it's a very hard decision to make but the way we make it is from a lack of philosophical, ethical and moral education that could lead people to make better decisions.  

    When my stepfather was dying, he was in agony and spent his last couple of months in a hospital bed hooked to machines at a cost of over $500,000.  The hospital needed all 5 children and my mom to consent to disconnect him and one of my brothers refused to sign the papers so they kept him alive and miserable for two months as the family argued back and forth.  Finally, my stepfather had to say to my brother "let me die" for him to change his mind.  There was no reason for any of it and it shouldn't have even been anyone else's choice.  Play that scene out 100,000 times a year and there's $50Bn down the tubes – enough to provide health care to 5M people.  

    Good guidelines on this from the UK.

  67. Hedges/Phil – is there a best end-of-day hedge to put on?  TZA?

  68. Phil/Alternative medicines

    My wife is an Ayurveda doctor which an ancient medical science from India and treated as an alternative medicine here. It is a valid treatment in some states but not yet recognized in some, which is weird as either all states should agree or not. I think it is the doctor lobby in each state. anyways…you have seen the book and the science is very profound and simple and it believes in the power of our body to heal itself as you said. each one has a mean (so to say) which is his/her genetic print and due to stress and lifestyle we deviate from the mean and that leads to diseases. The treatment is very individualized and just focuses on getting one to their mean using natural ways.

    But of course we cannot use it for last stages or critical or emergency conditions. It really does good on chronic diseases and if followed with belief can cure genetic issues as well which are passed on hereditary in the family. Very powerful but belief and patience is required.


  69. Thanks!

  70. Have a great long weekend everyone !

  71. Best/Scott – I'd go TZA July $11 ($2)/15 (0.90) for $1.10 you get $5 in protection and it's almost $1 in the money to start.  

    Ayurveda/Pat – That's right, I forgot about that book!  It was very nice, thanks.  

    Wow what BS.  They punched it up into the close to print green on all but Nas but Futures promptly turned red.  Well, what else could we expect on a Friday?

    Have a great weekend, 

    - Phil

  72. Phil – "It's not a discussion about whether the proles are worse off, it's about whether it's logical to bet on inflation boosting the markets.  You're trying to make a point that has nothing to do with our discussion on wages in relation to investing (this is an investing site, you know)."  

    Are you kidding? Well there you go again, so many circles, so few tails to chase. The backhanded mis-attribution is getting old, tired and lame, so what ever was IT a discussion about?   You might as well say that politics has nothing to do with markets or investing either.

    Again, you misinterpret my comments to suit your needs. Sleight of hand by Mrs Paul (rendering fish sticks) and another red herring toss from the Gorton's Fisherman shall not suffice ol chum. So let's refresh shall we? YOUR original comment which I quoted was….

    "Strong INFLATION numbers are killing us this morning (CPI), keeping the FED on the table for more tightening."

    I commented on Dalio seeing the resultant pattern, but not the underlying cause, and the Fed heads not seeing the forest for the trees. Which then became a discussion of REAL wages, which YOU incorrectly claimed have positive growth rates in multiple comments, and I proved have negative growth rates, in more ways and places than one. Your welcome. BTW, I never argued that nominal wages weren't rising, that was your misconception followed by the curious contention that real wages don't need to rise.

    Contrary to your above assertion, of course I made a point which has EVERYTHING to do with our discussion on wages in relation to investing, why else would we ever be discussing it?  If one claims that wage inflation and real wages are NOT related to the discussion of or betting on "inflation boosting the markets" or the falsity in the CPI, then one does not know what IS, or which way is UP.  

    Speaking of health care plans and alternative medicine… Might I recommend the triple meat and cheese lovers pizza, a litre of Barbera, Hanna, a preferred mood enhancer, and not necessarily in that order. Time for my IV, don't ask about Hanna and Out.

  73. By the way, Pat, you know I started using Sakara for my own diet.  I think the recipes you have coupled with the book's style and philosophy could make an excellent competitor for them.  It's a huge space but few do the health aspects so let me know if you guys are interested in discussing.  There's a cafe in NYC - not sure how authentic it is but it demonstrates interest.

    Naybob – I have no interest on nitpicking this issue with you.  I said WAGES were going up, you decided real wages were not but then I said I don't care what they were doing, they are going to go up in the future and that then will increase the velocity of money and trigger inflation.  That's it – done.  You want to disagree and cite a ton of BS that's fine but I'll play for inflation and you can play for whatever you want and, in a year or two, we'll know who was right.

  74. 3 day weekend! WOOOHOOO!!!!!

  75. Hey Jabob, you know no one is making you work every day, right?  cool

  76. Mondays matter Phil!!! ;-)

  77. All days matter, Jabob…

    These are fun:







    I have to remember to check that site out.

  78. LOve the advocate idea. Even if you are knowledgeable on many aspects of the medical  treatments of the body when did-ease sets in, it is increasingly difficult to rationally know which path to follow. Thank you fellow Phil followers for such a enlightening and supportive conversation on this subject. Keep in homeostasis and as Edgar Cayce said " The mind is the builder. As you think so shall thee be." Namaste!!

  79. should be dis-ease!

  80. Phil/Ayurveda Diet

    I will check on sakara but I did check the Ayurveda café and did not find it interesting. It is just another indian food café with maybe better ingredients and method of preparation (less oil, sweet etc). First one needs to find his/her mean and also the current deviation (better if found out by a practitioner). Then you can avoid specific foods that increase the deviation and focuses on those that reduce it. It is not a simple formula but can be achieved. 

    grateful for your thoughts to discuss this with us and we surely will come to you once we have this mapped out. we are opening a small space in end of march that will be just consultations for helping find blueprint and current state. This is to start with and then the food part will come very soon. looking forward to it…


  81. Pat would love to find an Ayurvedic practioner in proximity to me. Any national directory's around?  Thanks for your info.

  82. An old tale, which I believe is required study for all Goldman Sachs newhires:  

    starts about 5 minutes in:


  83. "The beatings will continue…….."


    General Electric’s Dim Prospects


    THE BULL CASE FOR GE is made by analysts such as Nicholas Heymann of William Blair, who sees a likely bottom in earnings. In a recent client note, he wrote that “once regulatory reviews and shareholder lawsuits are settled or dismissed, we believe GE’s focus on better-than-expected free cash flow and an accelerated pace of asset sales are likely to enable the shares to return to a ‘normalized’ valuation of 20 times trough earnings per share of $1 to $1.07, or a valuation in the $20 to $22 range.”

    Inch’s retort to the bulls is that an investor “should pay 20 times earnings for a company with significant growth prospects backed by free cash flow.” GE, he says, doesn’t qualify, noting that “GE may take many years to work out its challenges.” Honeywell, a top-performing industrial company, trades for 19 times projected 2018 earnings.

    The next humiliation for GE as a U.S. corporate icon could come if it is dropped from the Dow Jones Industrial Average as a result of its depressed stock price. It is the last remaining original member of the 1896 Dow: Its peers included the U.S. Leather Company and Tennessee Coal, Iron & Railroad.

  84. Week of chaos, again, engulfs Trump’s Washington

  85. CNN legal analyst: ‘Strong probability’ Russia handed Trump the presidency

  86. Trump Is Making MS-13 Stronger

  87. On Feb 7th in this forum, we pointed out how the MSM Trump-eted nominal hourly wage increase, was actually a decline in weekly earnings, due to the fact that average hours worked had declined.

    And now this confirmation in the REAL hourly wage decline from another terrestrial source of extra intelligence…

    In Congratulations Workers! You Make One Penny More Than a Year Ago – Mish Shedlock also points out the obviously sad but true facts from the January 2018 BLS wage report.

    For all of 2017… hourly wages went up from 9.16 to 9.17… ONE WHOLE PENNY…. HOORAY and at the end of the month you have extra money to SPEND… [for production] that's an extra $1.67 per month.

    And Mish's conclusion…

    The pundits are all worried about wage inflation. Spend it wisely folks.

    And I suppose, try not to spend it all in one place either. Although we would love to see healthy wage inflation for all driving this economic bus, the Nattering one could not agree more with Mish and the incontrovertible math.

    Unfortunately, as that bus driver and his union were kicked to the curb along ago, both real and nominal wage inflation won't be driving this economic bus or train wreck anytime soon.  Out.

  88. In their missive Velocity of Money, UCSD Econbrowsers Menzie Chin and James Hamilton pick at Friedman's equation, and go on to make the point as we have many times in the past, in that there is a critical distinction between the FED creating reserves in QE, as opposed to printing money…

    The demand for reserves has increased by a trillion dollars since 2008. The demand for currency held by the public has not. The supply of reserves could therefore increase a trillion dollars without causing inflation. The quantity of currency held by the public could not.

    They go on to explain why an increase in money supply implies nothing about inflation, and in fact reduces velocity…

    Even if there’s no particular relation between the quantity of marbles [money supply] and the stuff we care about (inflation and real GDP), you could still go ahead and use the equation above to define the velocity of marbles. But what you’d find is that when marbles go up, the marble velocity goes down, and it makes no difference for output or inflation. 

    And their conclusion?

    someone who insists that inflation (P) must go up just because the monetary base (M) has risen may have lost their marbles.

    Conclusions therein? Increases in money supply, even from wage growth, and as much as we might want them to, do not necessarily or always correlate with inflation.  Especially when the circumstances are less than normal, QE, ZIRP, NIRP.  Hamilton and Chin see the resultant pattern, but fail to address the underlying causes.

  89. Following up on whose not driving the economic bus, and Hamilton and Chen, another interesting take on "velocity" from Yi Wen and Maria A. Arias at the St. Louis Fed, where they pick at Friedman's equation MV = PQ. 

    According to this view [Friedman's equation], inflation in the U.S. should have been about 31% per year between 2008 and 2013, when the money supply grew at an average pace of 33% per year and output grew at an average pace just below 2%

    So we know from Hamilton and Chen, and the math above, that increases in money supply do not necessarily correlate with inflation rates, or nominal GDP (output).  So why did the monetary base increase not cause a proportionate increase in either the general price level or GDP?

    "The unconventional monetary policy has reinforced the recession by stimulating the private sector’s money demand through pursuing an excessively low interest rate policy (i.e., the zero-interest rate policy)."

    Indeed "abnormal" monetary policy or "there is something is this more than natural" QE, ZIRP and NIRP pursued to excess do reinforce constrictive conditions, viz a tightening. But how does this stimulating the private sectors money demand manifest?

    "The answer lies in the private sector’s dramatic increase in their willingness to hoard money instead of spend it. Such an unprecedented increase in money demand has slowed down the velocity of money, " 

    Hoarding and liquidity preference increased demand for money, and caused velocity to tank?  Sound's Keynesian, but wait remember what Hamilton and Chin wrote in 2010?

    The demand for currency held by the public has not [increased].

    So who is right? Or has somebody missed something? More important, how might lower velocity or the turnover of money effect the economy?

    When there are more transactions being made throughout the economy, velocity increases, and the economy is likely to expand. The opposite is also true: Money velocity decreases when fewer transactions are being made; therefore the economy is likely to shrink.

    Wen and Arias briefly touch upon something critical in hoarding, liquidity preferences and then transactions velocity or the turnover of money, but go no further down the path. 

    At the end of the day, much like Hamilton and Chin, Wen and Arias see the resultant pattern, but fail to dig farther to make the connection or address the underlying causes.

  90. Good morning!

    Asia still mostly closed, Europe up a bit at the open and our futures upslightly.  

    I in NYC with the family, not working at all but i’d short /RB at $1.75, now that the weekend is winding down.    Tight stops above, of course. 

  91. I see that Naybob is still acting like a very old dog with an even older bone.  

    Certainly far too senile to remember that for many years I have been saying that it does not matter how much money the Fed prints if the velocity does not pick up.  

    NOW, after tripling supply of money, rising wages will increase the velocity and, with all that money floating about, a small increase in velocity will cause a large increase in inflation.   That’s it. That is all I  have been saying.   You may choose to accept that simple statement or Naybob’s 40-page rebuttal.

  92. Alrighty then….

    Phil – "I have no interest on nitpicking this issue with you."

    Neither do I, as I only offered to assist in the exercise of critical thinking which is essential to analysis. Is this now taboo on PSW, as in the judicial, executive and legislative branches of our government?  Here's an example of a nitpicking comment…

  93. Phil – "You want to disagree and cite a ton of BS that's fine"

    Well, there you go again with the nitpicking, another false assertion and attempt at ad hominem. BTW, I don't on either count as I hold myself and those I have truck with to a higher standard.

    Bringing attention to the falsity in econometric MSM narrative or kool-aid being served up is what I do. I can only point out WHAT the twisted, omitted and obfuscated facts, being glossed over with lipstick on the pig ARE. 

    As presented, if ones sniff test fails to discern BS from a truffle, my somewhat limited powers of seeing the forest for the trees ends right THERE, just below that individuals impervious snout. 

    You nor anyone else, such as the tiny fingered, Cheeto faced, ferret wearing shit gibbon, has to agree with alternative views of, or a deciphering of the facts viz. the truth.  I can only attempt to lead one to water. 

    At the end of the day, I don't truck well with "disagree and cite a ton of BS", never my MO and I do not attempt to do so. I leave all sleight of hand, red herrings and ad hominem utilized to defend ever shifting positions of the goal posts, to trained professionals on a closed circuit.

    If that is ones prerogative they can have at it all they want Ol Chum. As for nitpicking, that's all folks. 

  94. Phil – "You may choose to accept that simple statement or Naybob’s 40-page rebuttal."

    My posts are not rebuttal nor 40 pages. Unfortunately, simple statements do not always suffice. Why do we eschew the texted, twittered, 280 character, elevator version which permeates the ADD, sound byte and mood enhancer afflicted society we suffer?  Same as it ever was, the devil is always in the details.

  95. Phil – "after tripling supply of money, rising wages will increase the velocity and, with all that money floating about, a small increase in velocity will cause a large increase in inflation."

    Ceteris paribus, more often then not historically correct, under normal circumstances.  However, this old dog knows that these are not normal circumstances, it is "different" this time but not like some dogs THINK.  As in what I have been saying for years about QE, ZIRP, NIRP and now QT, a central bank witches brew with toxic side effects viz. "there is something more than natural in this". 

    Why do you think I posted those renowned economists and pundits, some who get the wage angle, and others who can't quite put their finger on the velocity thing? As in, seeing the resultant pattern, but failing to arrive at the underlying cause? Bad doctors, give you pills to mask the symptoms. Good doctors find the cause or what lies beneath. Again, always in the details. 

  96. Tools of Trump’s Fixer: Payouts, Intimidation and the Tabloids

  97. Phil – "I see that Naybob is still acting like a very old dog with an even older bone. Certainly far too senile to remember "

    Not quite on that ad hominem. Old dog, yes we know many old tricks and new tricks, which can be based on old ones or not.  You betcha on the bone, due diligence requires diggin hard, diggin smart, and definitely not with one's head buried in the sand. Those who assume together = ASS U + ME. 

    What I'm trying to teach the discerning dog is a "new" trick, which might surprise some dogs when things don't go the way they THINK it should, then flail around with their hands in the air saying, "How and why did that happen? DOH!!!"  Pay attention to the details next time? If there is one.

    Few surprises for this old dog. Why? Always in the details, and because I've seen that movie too.  Praemonitus, praemunitus and Out.

  98. Did George Washington Predict Donald Trump?

  99. Feds Working On New Marijuana Banking Guidance, Treasury Secretary Mnuchin Tells Congress

  100. The Irresponsible ECB

  101. European Stocks Fluctuate in Thin Holiday Trading

  102. World’s Biggest Miners Emerge From Their Hole in a $200 Billion Comeback

  103. Some facts over Trump's budget, tax cuts and the economy:

    To put some numbers on that, revenue is projected to be only 16.3 percent of GDP in fiscal year 2019. The only times in the past 50 years that has happened were in the aftermath of the past two recessions. Even in the 1980s, you had tax cuts and a deep recession and we were collecting more than that in revenue as a share of GDP.

    The deterioration in the budget forecast relative to what was projected a year ago is largely because revenue has come down, both because the tax cut passed and because revenue collections are lower.

    Finally, you can look at the spending side of the budget, and you don’t see the type of out-of-control spending growth people talk about. The amazing thing is that Medicare in 2019 will be 3 percent of GDP. In 2009, it was 3 percent of GDP. That’s despite the fact that the number of Medicare beneficiaries has gone up from 45 million to 60 million. You’ve had a 33 percent increase in Medicare beneficiaries and no increase in Medicare as a share of GDP.

    Clearly not overtaxed and Medicare is not going to bankrupt us!

  104. To ALL who still belive in him Happy CLOWN's day!!!

  105. Yodi

     Do you trade options on any of the European exchange?

    Any broker you would recommend


  106. qcmike No I do not tade on any Euro makets. It is a complete different cattle of turf.

    Where are you resident?

  107. yodi 

    In Minnesota USA today

  108. Well qcmike you better stick to US trading. Especially option trading is not to popular in Europe.

  109. In honor of President's Day:

    Fake news I am sure! They didn't survey any of Trump's family or Twitter followers!

  110. yodi 

     Thanks  yes I will

  111. Yodi – When I initially read your CLOWN comment,  I flashed on a mental image of Bozo the Clown and Emmett Kelly. 

    Just kept scrolling down the page la-de-da-de-da, with that bobble headed clown head image in mind, as self said, alternating the voices of Erich von Däniken and Arnold Schwarzenegger "To ALL who still belive in him Happy CLOWN's day!!!"  Said to my self, oh you gotta love the German funny bone. 


    After reading StJL's presidential rating survey, which was fake news because as the 2 was a keyboard slip, T-Rump didn't get 12, it was like the 10 second delay hit, Phil knows somethings about senile, as it dawned upon me what the hell your comment actually meant.  You were NOT referring to…

    Kremlin Apprentice Asset-Clown, Guano-Psychotic Ass-Clown, Clown in Chief, Nostradumbass-Clown, Idiot Racist Reality TV Clown, Orange Clown, Tweetledumbass-Clown aka Fuckface von Clownstick? 

    I didn't think so, never mind, but thank you so very much for my ROFPIMPLMAO of the day.  

  112. Have a feeling this Monday will also matter Phil!!!

    Futures looking weaker (gold too)

    VIX futures inching higher too

  113. Hope you enjoyed your vacation, Jacob…

  114. ;-)

    Thanks Phil!

  115. Nat quite a number of clowns. The one thing I cannot understand that there are still so many clowns in the US, who believe in this payaso. He is the laugfing stock in Europe. Good for Carneval. An enormous different to the so popular Obama here. Simple like a clown, one does not know what he will pull out of his pocket next. But many children express their feelings on twitter.

  116. Chinese anger after terracotta warrior’s thumb stolen in US

  117. The War America Isn’t Fighting

  118. good morning from Cancun. Life is grand.