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Record-High Wednesday – Here Come Those Tears Again


The market has been running like a rocket.  Like one of those reusable Space X rockets as it keeps going up every time it falls.  The Nasdaq is retesting 7,200 on the 100 Index (/NQ) and we shorted that line this morning only because the last time we tested it (mid-March) we plunged 10%, back to 6,322, which was the 200 dma back in April.  This time, the 200-day moving average is back at 6,500, so still a 10% gap down if we fail to punch over.  That means our RISK is stopping out at 7,205 with a $100 loss while the potential REWARD could be $14,000 on a 700-point drop – that's the kind of bet we like to make!  

In our Options Opportunity Portfolio and our Short-Term Portfolio, we are using the Nasdaq Ultra-Short, SQQQ as a primary hedge because the index is full of overpriced stocks.  It's not a bet though, it's a hedge as it's crazy to BET that the Apple-driven index will go lower while AAPL is still under $1Tn in market cap (now "just" $950Bn).  $1Tn is more than the GDP of Turkey ($849Bn) so, if Apple were a country, it would rank 17th in the World.  Above them is Indonesia and Mexico – both at about $1.1Tn, which would be about $225/share for AAPL.  

Image result for 38th parallelI suppose if we're going to learn to accept valuations in the Trillions, we should start thinking about Corporations more like countries or maybe we should just start trading countries – it's a work in progress – anyone want to go long on North Korea at $17.4Bn?  With 25M people, that's just $696 per person – seems like a bargain compared to South Korea, which is "valued" at $1.7Tn for just 50M people so $34,000 per person's share.  Life is good below the 38th Parallel!  

How does a country with just $17.4Bn develop nuclear missiles?  That means Carl Icahn can develop nukes – he has $17Bn and Icahn is "only" ranked 73rd on the Forbes 500 list.  Jeff Bezos can buy a dozen nukes with his $112Bn and he's already got rockets, as does Elon Musk with $20Bn and he already looks like a James Bond villain!  We worry about tin pot dictators abroad but do we really know what the Kochs and Waltons are keeping in their bunkers?  

As we know with Billionaires – once one gets a cool toy, they all want it and Trump is leading the Billionaire Class into the nuclear age with his finger firmly on the button.  That's why Trump is worried about Kim Jung Un, not because he threatens our nation's security but because he threatens Trump's bragging rights that he has nukes and no one else at the club has any.  I know it sounds silly but maybe you've never heard a guy talking about the helicopter pad on his yacht for 2 hours…

Speaking of Elon Musk, last night they had a shareholder meeting and, amazingly, his cousins decided he could continue to be Chairman and CEO of Tesla (TSLA) and Musk CLAIMS the company will be building 5,000 Model 3s a week "by the end of June" AND that they were currently producing 3,500 vehicles per week.  As noted by Reuters, however:

The company has been engaging in so-called "burst builds," temporary periods of full-scale production. Tesla then extrapolates the number of cars built during these short-term burst builds over a longer time period.

Analyst Brian Johnson of Barclays warned investors in March to be wary, however, of brief "burst rates" of Model 3 production that were not sustainable.

Musk repeated his assertion that the company was not planning on raising additional debt or equity, without providing a timeframe, and said he expected positive net income and cash flow in the third and fourth quarters.  If he pulls that off, it will be amazing and we should let him have all the nukes his heart desires.  

TSLA's stock has been struggling to get back over $300 since Musk's March melt-down when he talked about "production Hell" and refused to answer analysts questions during a conference call.  Shares are about 25% off the highs and we've been shorting them but now we'll watch and wait to see if he's lying or not.  Musk has only given himself 3 weeks to put up or shut up – we can be patient.

Let's say Musk isn't full of crap and Tesla is really going to push out 5,000 cars a week by the end of the month.  Figure they've built 65,000 cars so far this year and this would give them another 130,000 through 12/31 so call it 200,000 cars at about $65,000 avg price (there are no cheap Model 3s yet and still plenty of S's and X's get sold) so that's $13Bn in sales, not up much from last year's $11.7Bn, when they lost $2Bn for the year.  So they are selling more cars than last year (115,000) but the mix shifting to the Model 3 at half the price of the S/X is going to keep the revenues from growing very much.

So, the question is, do we want to pay $50Bn at $300/share for an auto company with $13Bn in sales and a $2Bn loss?  I know I don't.  GM's market cap is $61Bn and they have $145Bn in sales and make $12Bn in profits so 10%.  Musk has to double his sales to $26Bn (10,000 cars/week) and double them again to $52Bn (20,000 cars/week) and makes 20% (double the competition) on those revenues just to get to 20% LESS than GM's current profits.  That is, of course, a complete and utter fairy tale as far as this decade goes – and that's just to justify the CURRENT price of the stock!  

Gosh, I'm talking myself into shorting TSLA again…  

On the whole, we're hoping the hype punches them back to their $380 highs and then we'll load up the shorts again because, if Musk did ramp production up to 5,000 cars a week (not 20,000!) – it certainly cost him an arm and a leg to hit that number and that will not bode well when they report Q2 earnings in July!  

Speaking of things that do not bode well, the Social Securty Agency will have to dip into it's $3Tn Trust Fund to cover program benefits three years sooner than projected just last year.  The reason stated by the Agency is lower than expected economic growth hampering revenues – interesting…  Low interest on that $3Tn has been killing them and look for Team Trump to argue that the money be placed in the stock market – so they can wipe it out quickly instead of slowly.  

Yeah, we're all totally F'd, may as well get it over with…

On the bright side, if the markets aren't concerned about this they aren't likely to be concerned about anything and we can carry on to new record highs.  The ECB will debate ending QE next month – so what?  The Fed will hike rates next Weds – so what?  The Bank of India just raised rates for the first time in 4 years (6.25%) – so what?  What's a little Global Tightening (QT) among friends?  Citibank credit strategist Matt King told CNBC about how QT is creating the current market turmoil:

“What we are seeing is relatively modest withdrawals from the central banks suddenly have broader consequences than the central banks have been anticipating, and that therefore does constitute a greater tightening as if we had two extra Fed hikes more than they were anticipating.

“So far it is not systemic, yes we are not worried about banks falling over in the same way as 2008 or even 2012. At the same time, we would expect a broadening out of the stresses, or the tensions, beyond where they are at the moment. So far it’s just Libor-OIS it’s not cross-currency bases, and yet there are reasons to think that as the Fed drains excess reserves from the system, we will see that tension broaden out.”

Jeff Gundlach thinks 2.63% on the 10-Year Note is the interest line we dare not cross and that's the line we're standing at right now (below 118.5 on 10-year Futures).

Venezeula is about to declare Force Majeure for failure to deliver on oil contracts – so what?  Europe is considering retailiatory bans on US goods and China has offered to purchase just $70Bn of US product (Farm, Energy, Manufacturing) to "balance" what Trump claims is an $800Bn trade deficit – is that something we celebrate?  How will Trump declare that a victory?  Well, we know how – loudly and often!  ZTE is already back in business after China lent Trump's Company $500M.

Money has been flying out of Emerging Market Funds with $12.3Bn being withdrawn in May, the most since Trump's election.  Default risks in Asia are rising sharply as Governments can no longer afford to bailout the number of businesses that have over-extended themselves in the "rally".  Even in China, junk yields have been flying higher this month, outpacing the rest of Asia by a full point and just under 10% – that's an implied 1 in 10 chance of default for Chinese companies!  

It certainly looks like defaults will pick up in Asia,” said David Kidd, a partner at Linklaters, who focuses on restructuring and insolvency matters. “There seems to be a political willingness to allow defaults.”

Five companies in the region have defaulted on dollar bonds this year, up from two in all of last year. China Energy Reserve defaulted on its bonds in May, as did Hong Kong developer Hsin Chong Group Holdings Ltd.  A record $282 billion of dollar bonds are due in Asia ex-Japan in the two years through 2020, coming at a time when analysts forecast the 10-year U.S. Treasury yield to rise to 3.56 percent by the first quarter of 2020. The yield has climbed more than fifty basis points this year, exceeding 3.1 percent in May before falling back.

"So what?" you say?  Well, then you are suited to be a US Equity Investor in this madness but me, I'm in CASH!!! and taking the Summer off until there is either a correction or a base is formed at the levels we are now testing.  

What can I say – I'm risk-adverse…


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  1. Good Morning, All!

    Today's webinar will be rescheduled. I will post details once they're solid.

  2. Related image

  3. Good morning! 

    No Webinar today and I'll be in and out in the morning, hopefully able to sit down for the close around 2pm.  Tomorrow I intend to do a Webinar but I may be overreaching.

  4. Well, I certainly forgot it was D-Day…

  5. Nice 25-point drop on /NQ, should be bouncy here and +$500 is not a good place to be greedy.  Can get back in if 7,170 fails. 

  6. D-Day / Phil – Thousands died to free Europe from tyranny that day. Maybe Europe will have to come here next to save us…

  7. Apple still behind with assistants even with the latest update:

  8. Jim Chanos on crypto – I think that he wants to debate BDC:

    In the new bitcoin and crypto-craze, the whole idea is that we need to get away from fiat currencies by creating our own fiat currency for which there is no lender of last resort, no third party adjudicator. For those who believe it’s a store of value in the coming apocalypse, the idea is that you’re going to have to safeguard your key under a mountain with fingerprint and eye scan security while the hordes are outside your bunker trying to get in to use it — for what, I have no idea. Because for those who believe that you need to own digital currency as a store of value in the worst-case scenario, that’s exactly the case in which a digital currency will work the least. Food would work the best!

  9. Great pick Ilene!  Thank you!

    March 15th, 2018 at 10:27 am | Permalink | Tweet thisIgnore this user

    Hi Phil and All – What do you think of SIG? It got slammed yesterday due to a decrease in guidance but it looks cheap to me: ?

  10. Wow, glad we took that profit – big pop on the open – especially the RUT. 

    Total BS I think, but what are you going to do?

    Save us/StJ – Great idea, please ask your countrymen to save us next time you're over!  I'm sure Macron would be on board after his last encounter with La Grande Orange. 

    Chanos/StJ – He's wrong, water filters will be the best currency…

    SIG/DC – Yes, very good one, we picked up $5,000 selling 10 2020 $30 puts for $5 in the LTP:

    March 15th, 2018 at 10:53 am | (Unlocked) | Permalink

    SIG/Ilene – Looks very good to me.  Made $4.28 per $39 share with big growth in ECommerce.  Margins were down a bit and they are reducing store count and inventory by about 7%, which incurs some costs and is driving down guidance.  

    The key takeaway

    Signet's fiscal Q4 numbers were decent, but its outlook indicates that it will face some tough headwinds throughout the year. E-commerce only generates a small slice of its revenues, and Signet could struggle against higher-end retailers and bigger e-commerce marketplaces as it attempts to grow them.

    I think they are worth a put sale for the LTP since we can sell the 2020 $30 puts for $5 and that's net $25 or $14 off the current $39 (35%) so yes, we can sell 10 of those for $5,000 and promise to buy SIG for a 35% discount!  

    That's the way PSW works best – always let me know if you see a good trade idea.  

    Indexes coming down fast, was that a flush to shake out the shorts or just a really erratic morning?

    Image result for there's supposed to be an earth shattering kaboom animated gif

  11. HMNY--any news? Ouch!

  12. Crack must be legal wherever Zacks publishes:

    Northern Dynasty Minerals Ltd. NAK has been on a bit of a cold streak lately, but there might be light at the end of the tunnel for this overlooked stock. And for technical investors, there is some hope when looking at NAK given that, according to its RSI reading of 25.15, it is now in oversold territory.

    What is RSI?

    RSI stands for ‘Relative Strength Index’ and it is a popular indicator used by technically focused investors. It compares the average of gains in days that closed up to the average of losses in days that closed down; readings above 70 suggest an asset is overbought, while an RSI below 30 suggests undervalued conditions are present.

    Other Factors

    Yet, NAK’s low RSI value isn’t the only reason to have some optimism over a coming turnaround, as there has been plenty of positive earnings estimate revision activity as of late. This is especially true when investors take a deep dive into some of these estimate revision stats and recent changes to Northern Dynasty Minerals’ earnings consensus.

    Over the past two months, investors have seen 1 earnings estimate revision move higher, compared with none lower, at least when looking at the key current year time frame. And the consensus estimate for NAK has also been on an upward trend over the past 60 days, as estimates have risen from -$0.18/share two months ago to -$0.12/share right now.

    If this wasn’t enough, Northern Dynasty Minerals also has a Zacks Rank #2 (Buy)which puts it into rare company among its peers. So, given all of these factors, investors may want to consider getting in on this stock now (or holding on), as there are some favorable trends that could bubble up for this stock before long. 

    I mean, I think they are worth a toss but this guy is silly!  

    HMNY/Jabob – Just the usual everyone bailing on it. 

    Damn, it was a head-fake before the fall!  7,150 already!  2,750 failing (so a good short line on /ES with tight stops above).  24,850 is the line to watch on /YM and /RTY is 1,666 again.

  13. SPWR getting crushed again today. I don't really see bad news… 

  14. stjean/solar/SPWR

    Seems like they are all still being affected by this (see below).  CSIQ down 25% in the past 5 days.

  15. And recovering.  No reason for any of this…

    Here's my Japanese interview from yesterday:

    Huge build in Oil/Gasoline!  That should cause $65 to fail.

    • EIA Petroleum Inventories: Crude +2.1M barrels vs. -2.0M consensus, -3.6M last week.
    • Gasoline +4.6M barrels vs. +0.6M consensus, +0.5M last week.
    • Distillates +2.2barrels vs. +0.8M consensus, +0.6M last week.
    • Futures -0.17% to $65.41.

    Stocks start higher as financials, energy are early leaders

    • Stocks start modestly higher as technology and internet shares continue to climb, with the Nasdaq and Russell 2000 notching fresh intraday records; Dow +0.4%, S&P +0.2%, Nasdaq +0.1%.
    • European bourses show little change, with Germany's DAX +0.2% and U.K.'s FTSE +0.1% but France's CAC -0.3%; in Asia, Japan's Nikkei closed +0.4% while China's Shanghai Composite finished flat.
    • In corporate news, Facebook -1.1% following a NY Times report that the company gave data access to at least four Chinese electronics firms, including one flagged by U.S. intelligence officials as a national security threat; also, Signet Jewelers +15.3% after reporting better than expected Q1 earnings and revenues.
    • Most S&P sectors are higher, led by financials (+0.9%) and energy (+0.8%), while the utilities group (-0.3%) is lagging.
    • U.S. Treasury prices are lower, sending the yield on the benchmark 10-year note 3 bps higher to 2.95%.
    • U.S. WTI crude oil futures -0.4% at $65.26/bbl.
    • Still ahead: EIA petroleum inventories

    FT: Exxon, Chevron accused over tax secrecy

    • A refusal by U.S. oil companies including Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX) to disclose their U.S. tax payments is undermining efforts to fight corruption in natural resources industries worldwide, transparency campaign groups tell the Financial Times.
    • Participants in the Extractive Industries Transparency Initiative, which include most major western companies, commit to disclosing how much companies are paying and governments are receiving for natural resource developments; XOM and CVX have disclosed their tax payments to other countries around the world but – like most U.S. firms – have chosen not to reveal their corporate tax payments to the U.S.
    • The EITI's chairman tells FT it is “disappointing” that the largest U.S. oil companies “did not provide the leadership expected from them."
    • The Project on Government Oversight and Oxfam say the EITI’s work is being damaged because XOM and CVX have refused to follow “this most basic aspect of compliance” with its standards.
    • The Trump administration withdrew the U.S. from the EITI last year but said it continued to “value the EITI as a critical tool to promote transparency, increase competitiveness and combat corruption around the world."
    • Defense stocks are mostly on the rise in early trade after the Senate released the text of the $716B defense authorization bill for FY 2019.
    • The Senate Appropriations Defense Subcommittee will hold a closed hearing at 10 a.m. to review defense innovation and research funding.
    • While the House passed its version of the bill on May 24, once the Senate votes, both chambers' armed services committees will name a conference committee to hammer out a final compromise in the fall.
    • Related tickers: (BA +0.5%), (LMT -0.2%), (OA +0.5%), (HII +0.1%), (GD +0.1%), , (NOC+1.2%),, (UTX +0.2%), (TXT -0.4%), (UTX +0.2%), (LLL +0.7%), (RTN -0.4%), (COL +0.2%),
    • First Solar (NASDAQ:FSLR-2.2% premarket and perhaps headed for its sixth straight daily decline after JMP Securities issues a two-notch downgrade to Underperform from Outperform and whacks its price target to a Street-low $46 from $87 in the wake of recent policy developments in China that have "shaken global markets" that likely will pressure margins past 2019.
    • JMP expects pricing pressure will accelerate outside of the U.S., and even in the U.S. pricing may decline as Chinese suppliers look to compensate for a sharp drop in expected demand at home.
    • Also, Guggenheim cuts FSLR price target to $62 from $74, as it expects solar PV prices to drop as a result of China’s shift.
    • FSLR has fallen nearly 12% since Monday's announcement that China's government would cut subsidies and curb construction on new solar projects.

    • Shares of Tesla (NASDAQ:TSLA) are higher in premarket trading as Baird keeps a positive outlook on the company after taking in the latest developments.
    • "While we do not model GAAP profitability for conservatism, we believe TSLA will be able to achieve sustainable operating cash flow and operating profit in the intermediate-term, which would be a significant catalyst, in our opinion," writes analyst Ben Kallo.
    • As expected, Tesla said at the annual shareholder meeting that it's on track to hit a production rate of 5K cars by the end of the month and detailed plans for the Shanghai factory. The shareholder votes also went according to plan, although Kallo thinks the wide margin of the board re-election is a vote of confidence in current management.
    • It's not too early to talk about the Model Y after the company released another teaser picture of the electric SUV and Elon Musk joked on whether it would even have a steering wheel. Bullish-leaning firms such as Baird think that Tesla's valuation can remain elevated if enthusiasm over the long-term potential of the Model 3, Tesla Semi and Model Y keeps churning.
    • Model Y teaser picture
    • TSLA +3.91% premarket to $302.50.

    • Delta Air Lines (NYSE:DAL) falls after posting its May traffic report and updating guidance.
    • The carrier saw revenue passenger miles increase 2.9% in May and capacity rose 3.5%. Load factor dipped 40 bps to 86.3% during the month.
    • Looking ahead to Q2, Delta sees EPS of $1.65 to $1.75 vs. $1.80 to $2.00 prior and $1.88 consensus on a lowered view of pre-tax margins.
    • Shares of Delta are down 2.62% in premarket trading.
    • There are some gentle declines in the airline sector after Delta Air Lines (DAL -2.9%) lowers its profit expectation for Q2.
    • Sector movers: American Airlines (NASDAQ:AAL) is down 1.20%, United Continental (NYSE:UAL) is off 0.40%, Hawaiian Holdings (NASDAQ:HA) shows a 0.95% decline, JetBlue (NASDAQ:JBLU) is down 1.11%, Southwest Airlines (NYSE:LUVdrops 0.77% and Alaska Air Group (NYSE:ALK) is 0.92% lower.
    • While higher oil prices are a known drag on airline profitability, there are also concerns that carriers are having trouble lifting fares on key routes.
    • Previously: Delta falls after guidance update (June 6)
    • Nvidia (NASDAQ:NVDA) CEO Jensen Huang says it will be “a long time” before the next gaming GPU announcement.
    • Huang’s comments came during reporter roundtable in response to a question about the next GeForce GPUs. 
    • Huang doesn’t hint at a timeframe but says people should buy Nvidia’s existing GeForce GPUs now that the prices have dropped a bit. 
    • Nvidia shares are down 0.3% to $264.32.  
    • Snap (NYSE:SNAP) is up 3.7% after notes with a few sparkling data points from Deutsche Bank and Needham this morning.
    • Deutsche Bank's Lloyd Walmsley sees a turnaround with May user growth looking "robust" after "the redesign of the redesign" in late April. He's still cautious because it's just one data point and June will be key, but user growth has topped 3% in each of three regions, prompting him to raise estimates for DAUs and revenue. (h/t Bloomberg)
    • Needham's Laura Martin met with a senior ad exec whose clients' spending on Snap was up 85% in Q1, good news tempered by the fact that that spending is down 45% in Q2 so far. It's not clear which pattern is more normal, she writes.
    • Previously: Snap up 2.4% on positive Deutsche note (Jun. 06 2018)
    • Yelp (NYSE:YELP) is 2.1% lower premarket after a cut to Sector Weight by KeyBanc, which sees some weakness in its latest customer checks.
    • Analyst Brad Erickson is seeing a "lack of commitment and indifference" toward staying on the platform from recently added customers, a "worrisome" development that has him cutting estimates for paid account adds for the rest of the year. (h/t Bloomberg)
    • Shares have had a strong year, up 46.6% over the past 12 months, but have tailed off 3.3% over the past month.
    • HP (NYSE:HPQexpects to cut 4,500 to 5,000 jobs by the end of FY19 as part of the ongoing restructuring plan.
    • HP announced the restructuring plan in October 2016 and then said it expected to cut 4,000 jobs. 
    • HP had 49K employees as of October 31. 
    • The company expects pretax charges o about $700M related to the layoff, up from the previous forecast of $500M. 
    • HP shares are up 0.9% premarket to $23.63.  

  16. I have to run, hopefully back around 2pm.

  17. Thanks Dclarck! Makes sense…

  18. It looks like the strategy for SPWR is to sell puts around $7 and sell calls around $9!

  19. stjean/SPWR

    Have to check their exposure to Chinese markets.  The changes the Chinese government made are quite substantial.  Are the initiatives in California enough to offset China damage?  After that, are there many other reasons to invest in solar, for now?

    China is arguably the most important market in the solar industry today and if it shrinks from 53 GW in 2017 to around 30 GW, as  AECEA and Daiwa Capital Markets's Dennis Ip predicts, it'll have a widespread impact on the industry. Solar panel prices will likely fall on lower demand, which will impact margins in China and abroad. We could see companies start to lose money again and some may find it hard to stave off bankruptcy. 

    There's also uncertainty as to when China's solar market may recover. If local governments implement stringent rules on how solar installations are compensated, it could dampen demand for years. There's simply no positive way to spin today's news and that's why solar stocks are falling across the board.”

  20. Thanks Dclark – And of course, no help from Washington is expected with the clown show we have there. But we'll pour money to help coal and nuclear. 

    Just searched the transcript and there is not one word about China in there so I don't know what their exposure is there at all, if any. But they seemed positive. We'll see. In any case, a very small position for me.

  21. LOL:

    Former White House Communications Director Anthony Scaramucci argued Tuesday that President Donald Trump doesn’t lie, he just has a “different style of communication.”

    We live in a strange world!

  22. Anything going on with ABX?

    It seems like they are behaving much worse than the other miners?

  23.  Sorry guys, running super late, might not make it back until after the close.  

  24. ETM bouncing up big today.

  25. up up and away…

    will these markets ever even have a mini correction???

    good grief!!!

  26. ETM/albo – good buy on your Dec puts. I put in orders at .70 yesterday but didn't fill…

  27. …or good 'sell' I should say.

  28. Thanks, Scott – I remembered you were in the stock.  Just looked like it got too cheap.  Hope that was the bottom.

  29. StJ there is absolutely no point to trying to discuss crypto on this board. The weird thing is I've been kind of right. I read something about credit card points now? Im just like wow. Is that for real? Does anything I say in substance (if not in form) get read? Becasue all I see is getting insuted and people threatening me with violence.

  30. I don't know about violence BDC… I still read your posts. Even if you don't agree, it's good to hear another point of view. I like Chanos so it's another point of view. The guy is pretty smart. I am personally not sold entirely on crypto but I have been known to be wrong now and then. But no threats of violence or insults needed from me.

  31. it's a software protocol. that's it. I think it's interesting. and that's about it. When people talk about armageddon, that's just such a head scratcher. Everything, save food and protective physical items is worthless then. It's a non-argument, there's nothing to argue.

  32. BDC-I read everything you write and do my best to understand the concept of crypto and finally it is starting to make sense especially in the concept of global trade. It is just such a maze of finding the right one to invest in and having to open a wallet and invest in Bitcoin to trade for others. It is certainly relevant for the new cannabis revolution, but the powers in charge hate it because it can't be tracked and therefore TAXED! Just my take on things.

  33. Mulvaney just axed ALL of the CFPB's advisory board and the board chair. He says he is right-sizing!!! With clones that agree with him and do nothing for consumers! Amazing!

  34. I can't believe how marreid people are to the current version of money. It's really like a religion; it's just all faith based. I collect currency so maybe I know some things others don't (but should?). Do you know how many different types of currency systems there have been in this country? United States Notes, National Bank notes, gold certificates, federal reserves, silver certificates, etc etc. I remember catching Red Seals at a gas station where I worked in 1992. Every time one of these new note series' came out the government has no idea if it'll really work or if there will be uptake. You know where "Dixie" came from? The $10 bill from Louisiana. It was trusted up and down the Mississippi river. It's so cool, real history right in front of you. People should study it. Why did a regional currency exist in a Federal Republic? Knowing this history helps knowing where currency might go. And this is only US currency, then you've got the rest of the world, now connected by internet like they were your next door neighbor. The current version of currency does not enable knowledge economy transactions as efficiently, much in the same way the regional Dixie is no longer as efficient in our Federal Reserve system now.

    Currency is not static, it's not like a physical scientific law like gravity. It's an evolving, organic, figment of the human imagination. Even the "value" of gold is. So I point out the nature of currency trends and people get really chippy and it's just weird, I mean, I don't even care all that much about it and then I'm the only one defending it. Crypto coin, vagina coin, snot-nose thinned skinned- seattleite coin, I don't fucking care, who gives a shit? I don't give a shit. For me it's interesting to watch more efficient trust systems penetrate into socioeconomic systems though. THIS IS CURRENTLY IRREVERSIBLY OCCURRING. But then, duh, that's not even a bold or esoteric prognositication. It's the constant. Currency always has been, and always will be, changing. Why? Because currency reflects the current status of human transactions, not vice-versa. Those that cannot even admit this is happening when you can watch it happening right in front of your face, it's just like an out of body experience for me. If you put a pot of cold water on a hot burner, 15 seconds later stick your finger in and say "What a scam! The boiling water theory is so stupid!" What's wrong with this statement is intuitive to people so I like this example. It's obvious the rate of heating is physical thing, the rate of heating is like gravity. The outcome is inevitable. That's what I see now, with currency, climate change and healthcare. The forces are there so the outcome is a known known. The friction of adoption is the unknown (known unknown? I need Rumsfeld!). So take this context and filter through it some guy talking about bitcoin during armageddon. Oh my god who cares? It would be more meaningful to discuss this with a child.

    Pirate – governments will always collect taxes. I posted in the crypto corner how they could adopt a tax into a crypto that torpedoes the need for the IRS entirely! It was a futurama type of post. But anyway, the IRS has declared bitcoin/crypto as capital assets that get taxed like stocks. That seems pretty straight forward to me. "Powers in charge" — 1) you need to get specific about who do you mean, or the statement is just too general to be actionably discussed, and 2) even stipulating the blanket statement, does that really affect anything, it just moves the "Rate" versus "friction" discussed above, IMO. On investing – I gave up even trying to keep up. I just don't care enough about crypto to follow it that closely, at the individual project level. I would do it if someone paid me, but for my own interest I'd rather spend and enjoy my time collecting 19th physical currency. 

    Back in 2013 I advocated for a "hedge fund" type of group investment that purchased and held the top 50 or 100 coins in the market cap list but no one was interested. It would've made 100X. Ethereum alone went from $0.30 to $1,350 from July 2014 to January 2018.

  35. Wondering what a $10 Dixie note is worth today… bet it's better than our dollars purchasing power since 1913…

  36. If any of you guys are on twitter, check out DPRK News Service.  Its the funniest thing on the site. 

  37. Holy crap, what a rocket ride today!  

    Can't short anything in this madness.  Even oil bounced back.

  38. Just saw a model 3 parked at work – hideous. The look of it really isn’t appealing.