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Monday Market Madness – Denial is Not Just a River in Egypt

Image result for stages of deathHoly cow! 

I guess it's because I'm one of the last macro fundamentalists left in the markets that I am surprised – no, shocked, by the complete and utter denial the bulls are in regarding what is already the biggest Trade War since the 1930s and will very soon be the biggest Trade War in human history.  As noted on the chart to the right though, it's a very normal psychological phenomena – especially when experienced by those unprepared for a loss and, after 10 years of stimulus – there's a whole generation of traders who don't even know what a market loss is…

The market is clearly in denial and the Financial Media is merely a tool of the Investment Banks, so don't expect them to explain things to you and, unfortunately, very few people know what a Trade War actually is or what it does – thanks to a very poor education system – especially when it comes to Finance in this country.

Image result for china trade war cartoonChina does know what a Trade War is and, just this weekend, the Chinese Government's Global Times said "China will not be content to only play defense in an escalating trade war with the United States.  It is nothing new for the U.S. to try to escalate tensions so as to exploit more gains at the negotiating table."  Beijing may also decline to participate in proposed trade talks with Washington later this month if the Trump administration goes ahead with the additional tariffs, the Wall Street Journal reported on Sunday, citing Chinese officials.

The Journal report quoted one senior Chinese advisory official saying China would not negotiate "with a gun pointed to its head."  Besides retaliating with tariffs, China could also restrict export of goods, raw materials and components core to U.S. manufacturing supply chains, former finance minister Lou Jiwei told a Beijing forum on Sunday, according to an attendee.  "Lou Jiwei's approach would feed the most hawkish sentiments in the U.S. government," the person said, declining to be identified given the sensitivity of the matter.

Image result for china rare earth trade warAs I have warned since Trump first began messing with China on trade – you don't threaten a trading partner who provides you with vital products and China's rare earth materials are literally something the US economy cannot live without.  If China does something that drastic, within two weeks they can make Trump crawl on his knees through Red Square to kiss Xi's ass if they want to – there is no possible way to replace China's supply in any reasonable period of time nor do we have stockpiles of rare earths – if we get cut off, tech manufacturing dies quickly.

Of course, it is very possible that this is exactly the reaction that Donald Trump is looking to provoke as a cut-off by China of rare earth materials would give Trump the excuse he needs to declare a State of Emergency, which would allow him to tear up EPA regulations and open Federal lands to strip mining because rare earths are called that not because they are only found in China, but because their concentration in rocks and soil is so minute that you must decimate the environment if you want to mine them.  China has been willing to do this and so, they supply the world with rare earths.

Image result for rare earth elements

If Trump is able to excercise executive power and hand out "emergency" contracts on rare earths, he will control Billions of Dollars worth of potential profits he can hand out in exchange for political and financial favors and, given how fast the noose is tightening on his administration – this may be the quick, fast score he needs to make as he may not be in office long enough to finish his more elaborate enrichment schemes.  Given how badly he'll be needing support soon, provocing China into causing an "emergency" is his best self-interested move.

Meanwhile, as the Sword of Damocles hangs over the heads of US manufacturers, US investors seem completely oblivious to the danger and the Dow is opening this morning at 26,160 – right where it left off on Friday despite the escalation of tensions over the weekend.  

Now, I know I sound like Chicken Little when I say the market is going to fall but it IS going to fall – I jsut don't know when.  The Dollar has been driven down 0.4% this morning and that's supporting the indexes at the moment but, once again, we'll take a long off the 94 line on /DX, looking for at least a bounce to 94.20 but Friday we hit 94.50, which was over our 94.40 goal for the day and was good for gains of $400 per contract from our Morning Reportyou're welcome!  

Also from Friday's morning Report we had our call to short the S&P (/ES) Futures at 2,915 and that gave us a lovely 10-point drop to 2,905, which was good for gains of $500 per contract and a great way to finish perfect week on the Futures and today we have another chance to jump into Coffee (/KCN9) long at $106.50, which is $98 on the front-month contract and should be bouncy for at least 2 points, which is $750 per contract, so certainly worth a toss with tight stops below.  

Of course, /KCN9 is next July's contacts and what we're doing is taking short-term profits and leaving a few open for the long haul as we expect to hit 120 between now and than and that's $7,500 per contract if things go well on coffee.  At the moment, there is a surplus of coffee after Brazil's big harvest and that is projected to continue into next year (Vietnam is also projecting a huge harvest), so prices may indeed have further to fall, but long-term users like Starbucks (SBUX) and Dunkin Brands (DNKN) will begin locking in long-term supplies at these rock-bottom prices so we expect the 100 line to be supported and then, down the road, any negative news between now and July will lead to a lot of short covering that should give us a nice rally. 

As far as the indexes go, we still like /ES short at 2,915 and if the Dow (/YM) makes it back to 26,200, that's a good shorting line as well.  For the Futures challenged – I point you to last week's DXD trade idea.  

Meanwhile, whether you accept or deny that Trade Wars will affect the markets, I urge you to pay attention to what's happening on that front as it won't take much to send the Dow 100-200 points lower in very short order.  That will be fantastic and fun for those of us holding onto shorts and hedges but very un-fun for those who are not.  

This whole week is a bust as far as data goes with Empire State this morning and then nothing big happening until Thursday, when we get the Philly Fed, Home Sales and Leading Indicators  and then Friday we have the PMI and end-of-quarter Quadruple Witching and then the next week ends the Q so we expect window-dressing through the 28th but October is shaping up to be a real wild card and November is the election – when things can change drastically.

At least it will be an interesting fall.


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  1. ~~AVGO 

     Nomura/Instinet analyst Romit Shah upgraded Broadcom Limited (NASDAQ: AVGO) from Neutral to Buy with a price target of $300.00 (from $225.00).

     The analyst is more constructive on the name noting that "there we so many positive takeaways: from the company's earnings report

  2. Didn't realize the size of Berkshire revenues!

  3. Good Morning!

  4. Some 2021 options are now trading.

  5. Good morning! 

    /KCN9 with a $1 pop already this morning so don't be greedy but, of course, weak retrace off 106.50 to 107.50 is 0.20 and strong is 0.40 so I'd hold unless 107.25 breaks and then look to reload when it finds another base.  0.75 is still $280/contract – good enough to pay for the morning donuts.  

    AVGO/Albo – At $240 the cap is $99Bn and, though last year was $1.7Bn, this year they made $6.5Bn in Q1 (special profits, $6Bn tax credit) and $3.7Bn in Q2 ($2.7Bn tax credit) and $1.2Bn in Q3 (paid no taxes) so they'll look fantastic for 2018 with the combined CA earnings but, going forward, it's hard to get a handle on what they really make.  They only have $20Bn in sales and they bled out almost $9Bn in cash the past 3 Qs as well as their "income" is a huge illusion.

    If we consider they are an amazing chip company and say they drop 20% to the bottom line, that's going to be $4Bn, which gives them a current p/e of 25.  Once again, I think we have lazy analysts extrapolating one-time tax gains over time.  Note in 2018 (and only 1Q left for AVGO), Operating Profit is $4.2Bn and Net Profit is $11.6Bn and then they extrapolate Net Profit to continue at $9Bn, despite no real change in revenues.  That's idiotic, of course, but this is the sad state of analysts these days:

    Year End 29th Oct 2012 2013 2014 2015 2016 2017 TTM 2018E 2019E CAGR / Avg
    Revenue $m 2,364 2,520 4,269 6,824 13,240 17,636 20,248 20,819 21,495 +49.5%
    Operating Profit $m 582 551 438 1,632 -532 2,217 4,231     +30.7%
    Net Profit $m 563 552 263 1,364 -1,739 1,692 11,676 9,207 9,215 +24.6%
    EPS Reported $ 2.25 2.19 1.16 4.95 -4.45 4.03 9.99     +12.4%
    EPS Normalised $ 2.28 2.12 1.71 5.44 -2.36 5.12 10.8 20.5 21.4 +17.6%
    EPS Growth % +0.5 -7.1 -19.4 +218.7     +322.2 +301 +4.17  
    PE Ratio x           46.1 21.8 11.5 11.0  
    PEG x           0.15 0.072 2.76 1.32

    So I'd be careful with AVGO.

    Big Chart – Oh year, we're going to have to do those updates if the top of those M's break but not if the bottoms do! 

    Ranks/StJ – Funny how we forget what monsters XOM and CVX can be if oil prices move up.  Probably good to have for long-term holds. Most profitable chart is cool too.  Note those mineral states that would benefit from Trump scrapping EPA regs and letting them become open pit miners.  

    2021/Albo – Yay, my favorite time of year begins.  So much mis-pricing when LEAPS first start trading!

  6. Phil, thanks on AVGO.

  7. FTR trading over $6.

  8. gis earnings tomorrow before the open

  9. Phil/tariffs: Trump says it's going great!  “Tariffs have put the U.S. in a very strong bargaining position, with Billions of Dollars, and Jobs, flowing into our Country – and yet cost increases have thus far been almost unnoticeable."   

    I guess the $12 billion farmer bailout plan doesn't count as a cost !  

  10. Pesky facts again Tom! We don't deal with facts anymore. We live in a post-truth society.

  11. Phil / FTR – Any news on FTR – I'm thinking about selling some short callers Jan '19 $ at $1.0 this would break me even on this one, or drop my basis on the stock by 15%… 

  12. corrected

    Phil / FTR – Any news on FTR – I'm thinking about selling some short callers

    Jan '19 $6  at $1.0

    this would break me even on this one, or drop my basis on the stock by 15%… 

  13. You're welcome Albo.

    FTR/Albo, Batman – Same no news as they went down on it seems:

    I hope they don't go too crazy, our target is only $8 in 2020, but it was fun watching people worry about them for the summer.

    FTR Frontier Comms. Corp. 2500 1/2/2018 258 $17,875 $7.15 $-1.01 $7.15     $6.14 $0.35 $-2,525 -14.1% $15,350
    Short Call 2020 17-JAN 8.00 CALL [FTR @ $6.14 $0.35] -25 1/3/2018 (487) $-3,125 $1.25 $0.00     $1.25 - $0 0.0% $-3,125
    Short Put 2020 17-JAN 8.00 PUT [FTR @ $6.14 $0.35] -25 1/3/2018 (487) $-10,000 $4.00 $-0.70     $3.30 $-0.00 $1,750 17.5% $-8,250

    Cash Flow post CTF
    As you can see, since the acquisition (and it hasn't even been 2 years for a massive acquisition) they've generated $4.5Bn from operations, borrowed $5Bn (for the acquisition and related expenses) and netted a positive cash flow of $1.3Bn (because they suspended the $2Bn dividend).  Give them 8 more quarters and the fact that $6.18 is a market cap of $650M for a company generating $2Bn a year in cash flow will be obviously ridiculous – now it's only ridiculous if you think about it for 2 seconds…

    The debt is being serviced, they have until 2022 to pay off their next big note ($2Bn) and all they have to do is stop buying assets and they should be able to save up for that with no problems – especially if they continue not to pay a dividend.  

    Meanwhile, we bought in for net $1.90 on 2,500 shares as one of our first trades in the new portfolios and, if we get assigned another 2,500 shares at $8, then our average cost would be $4.95 per share on 5,000 shares and then we could sell 50 2021 $5 puts and calls for $3 or more and our net cost would be $1.95/3.50 on up to 10,000 shares so 2/3 an allocation block if we get "forced" to DD twice but, sadly, we're much more likely to be called away at $8 with only a $6.05 x 2,500 = $15,125 in 24 months on our initial investment of $4,875.  

    That's why I have a very hard time getting worked up about the current price of FTR – I'd rather they go lower and stay low so we can accumulate it because, if they are over $8, we "only" make 150%/yr on our 1x entry.

    $12Bn/Tom – Great point!  

    FTR/Batman – Well, we have short callers in the LTP and they are still $1.30 so those are still what I'd sell.  I think it's a fair target given the time-frame I expected for the recovery.

  14. Dow is still the lagging short in case you are missing out:

    Remember, we like /DX long off that 94 line!  

    AMZN down 2.5% ($50).

    Amazon investigating employee data leaks: WSJ


      Consumer Sentiment hit its highest level in 17 years this year. Sentiment fell 11% in 2015, an Obama year, and rose 16% since the Election, !

    Wow, this guy is completely nuts.  Either that or he thinks his followers don't grasp the basic fundamentals required to check a fact.

    So Obama took over in Jan '09 at about 60 and handed it to Donald in Jan 2016 at 95 – up 60% and now it's at 101 which is 6% – just 1/10th of Obama's gains after almost 2 years and Trump acts like he's Jesus.  Is he ignorant or a psychopathic liar?  Well, you have to imagine someone in the WH has the balls to tell him his statement is inaccurate – even if he legitimately is too dumb to understand how to read a chart.  That makes us have to lean towards psychopathic liar and 6,000 confirmed fibs in 2 years is a lot of evidence supporting that conclusion.

    Tariffs have put the U.S. in a very strong bargaining position, with Billions of Dollars, and Jobs, flowing into our Country – and yet cost increases have thus far been almost unnoticeable. If countries will not make fair deals with us, they will be “Tariffed!”

    Did I mention I'm shorting the Dow?  

  15. Can't get a fill on the DXD weekly calls. Boo. 

  16. Phil, any recommendations for non-futures traders re oil and coffee over the next 3-6 months?

  17. Also, thoughts on WPM. I currently own the following:

    +35 jan20 17.5 calls

    -35 jam20 25 calls

    -25 jan19 17 puts

    Thinking of rolling the 17.5 calls down and out to 2021 which is now available.

  18. Florence flooding spreads as storm heads northeast

  19. Uber Is Said in Talks to Acquire Dubai Ride Hailing Firm Careem

  20. Phil  / FTR thanks for the feedback on this  $8  in 2020 caller …. ( I think we read the same article on SA ) on the Article – This is a reasonable idea that I thought they would do but they have not, there may be restrictions in earlier loans that limit the ability to do this.  The cash flow does not hit the 2.2 B payment in 2022 and falls short between 1 and 2 B – depending on cost reduction plans and payment of later tranch loans prior to earlier ones.   Would they issue more shares?  interesting – I'm thinking of covering half my shares ( currently 6.3 ish basis) at $1.2 in Jan and if I've been through enough pain on this one to be Glad to get out w/ a BE and then have half the position with more legs to run.  

  21. Phil, I have a loss on my ABX position.  Want to take a tax loss.  Don't want to double down on ABX and I don't want to sell and buy back in 31 days.  Would like to sell ABX and buy a similar gold stock.  Any suggestions ?    Thanks.

  22. ‘The Maria Generation’: Young people are dying and suffering on an island with a highly uncertain future

  23. Survey finds 2M US teens are vaping marijuana

  24. Oldest US nuclear plant is shutting down on Monday

  25. World’s Richest Economies Enjoy Biggest Pay Raise in a Decade

  26. BBBY – Seemingly getting a lot of mileage from an upgrade by Raymond James from under perform to market perform.  Up almost 8%.  Maybe there's something else.

  27. /KC/Phil- coffee is getting killed today. Anything you see other than your morning note? Thx

  28. DXD/Soma – It's all over the place, if you ask for each leg you have a better chance of filling.

    Oil/JMD – With oil, we did an SCO play that's still good:

    Short Call 2018 21-SEP 18.00 CALL [SCO @ $15.61 $0.12] -20 6/22/2018 (4) $-3,000 $1.50 $-1.48 $0.40     $0.03 - $2,950 98.3% $-50
    Short Put 2018 21-SEP 16.00 PUT [SCO @ $15.61 $0.12] -10 6/22/2018 (4) $-1,000 $1.00 $-0.40     $0.60 $0.10 $400 40.0% $-600
    Long Call 2018 16-NOV 15.00 CALL [SCO @ $15.61 $0.12] 40 8/27/2018 (60) $6,800 $1.70 $-0.13     $1.58 $-0.08 $-500 -7.4% $6,300
    Short Call 2018 16-NOV 18.00 CALL [SCO @ $15.61 $0.12] -40 8/28/2018 (60) $-2,800 $0.70 $-0.15     $0.55 - $600 21.4% $-2,200

    On Coffee, I don't like the BJO ETF very much but it's not underperforming Coffee by too much:

    Both down about 25% since March.  So, if you wanted to use it as a proxy you could sell 5 March $37 puts for $2.60 ($1,300) and buy 10 March $37 ($3)/42 ($1.50) bull call spread for $1.50 ($1,500) and that's net $200 on the $5,000 spread that's at the money to start so all coffee has to do is not go lower and you should be in good shape.

    WPM/JMD – Oddly up today but generally getting killed with /SI.

    2021 is very thinly traded so you have to be very careful about what you pay for those calls but the 2020 $17.50s are $2 and the 2021 $15s should be less than $4 (I'd offer $3.80) and the short 2020 $25s are 0.50 so I'd buy those back and hope for a move back up before re-covering.  The $20s are $2.80 and the $22.50s are $1.50 so just make sure you get no less than $2 for the $20s (if it goes lower to cover the roll) but hopefully more than $2 for the $22.50s if it goes higher.  The short $17 puts are at the money so why buy them back?

    FTR/Batman – I don't know about you but I'm old enough to remember the growth of cable in the early days and all the investments made by phone companies and then Sprint and MCI and TMobile, etc and they ALL go through these rounds of growth and cash flow as they get bigger and Bigger and BIGGER over the long run.  If you want to cut and run on FTR – you should – it's going to be slow and annoying for years to come and maybe they'll end up being MCI but I think they know what they are doing and will end up just fine and twice as large – so I'd prefer to own them for the long haul.

    ABX/Albo – GG is the best approximation for ABX but I like CDE and HMY better.  

    BBBY/Albo – Another stupidly underpriced retailer.  I'm very happy with our position there, which is pretty aggressive:

    Short Put 2020 17-JAN 17.50 PUT [BBBY @ $19.39 $1.32] -20 1/8/2018 (487) $-5,600 $2.80 $-0.19 $-2.20     $2.61 - $380 6.8% $-5,220
    Long Call 2020 17-JAN 15.00 CALL [BBBY @ $19.39 $1.32] 30 4/20/2018 (487) $13,950 $4.65 $1.28     $5.93 - $3,825 27.4% $17,775
    Short Call 2020 17-JAN 22.50 CALL [BBBY @ $19.39 $1.32] -10 4/20/2018 (487) $-2,200 $2.20 $0.17     $2.37 - $-170 -7.7% $-2,370

    Coffee/Ravi – It's like investing in wheat or soy – there's not much day to day news, there are crops, they grow, they get harvested, weighed and shipped – that's the news.  Between that and demand numbers – people make their bets and, at the moment, people are panicking out below $100 on the front month.

    It went to $50 in 2002 so don't try to be a hero but, USUALLY, it trades a lot higher and I think $100 is the breaking point for growers – as evidenced by the article I pulled above:

    Coffee producers seek urgent talks with industry on low prices


    The World Coffee Producers’ Forum, whose members account for about 85 percent of global production, held a press conference on Monday after meeting to discuss the price crisis.

    “It is today a desperate moment for the 25 million coffee growers around the world. It is a crisis beyond imagination,” said Roberto Velez, chief executive officer at the Colombian Coffee Growers Federation.

    “We need the industry and consumers to realize that this is a situation that cannot be maintained if we want the coffee industry to survive,” he added.

    The market has been depressed by a record crop in Brazil this year while speculators have also made a huge bearish bet on the New York-based arabica coffee futures market, adding to the downward pressure on prices.


    “I would say millions of producers in the region are desperate right now,” he said. “A lot of farms are being abandoned, social conditions have deteriorated.”

    Among the schemes being discussed by producers is a positive certification program for companies willing to offer high enough prices to enable farmers to make a living.

    Many farmers are currently producing at a loss.

    “Our people are starving. The price (buyers) are paying for coffee today is less that the price they were paying 30 years ago,” he added.

    I've been saying this for a while and now it's in the news but that doesn't fix things immediately – it just indicates to me that /KC is a good LONG-TERM investment opportunity.  So perhaps coffee will trend lower but then these farms will close down and production will fall off and coffee will trend back up eventually.  It's not a day trade – it's a July of next year trade! 

  29. Phil – thx

  30. UPDATE: MoviePass parent Helios and Matheson to propose second reverse stock split

    Font size: A | A | A


    1:53 PM ET 9/17/18 | MarketWatch



    2:22 PM ET 9/17/18



    % Chg






    Real time quote.



    UPDATE: MoviePass parent Helios and Matheson to propose second reverse stock split

    The board of directors of MoviePass parent Helios and Matheson Analytics Inc. plans to propose another reverse stock split of common stock at a ratio of one share for two shares up to one share for 500 shares, according to a filing accepted by the SEC on Monday. In the filing, the company (HMNY) said the directors would make the proposal during a meeting of stockholders on October 18. The company implemented a 1-to-250 reverse stock split earlier this year in July. Shares of the company are now hovering between one and two cents, having fallen almost 100% in the year to date. The S&P 500 [s:SPX] has gained 8.2%. 

  31. HMNY/Jabob – Yes, my shares will be worth over $2.50 each!  I've got 80,000 of them!  Actually, I wonder how this is working out for the original owners, who probably now own very little of the company.  I guess it will all come out in the lawsuits – of which there are many.  

    he board of directors of MoviePass parent Helios and Matheson Analytics Inc. plans to propose another reverse stock split of common stock at a ratio of one share for two shares up to one share for 500 shares, according to a filing accepted by the SEC on Monday. In the filing, the company said the directors would make the proposal during a meeting of stockholders on October 18. The company implemented a 1-to-250 reverse stock split earlier this year in July. Shares of the company are now hovering between one and two cents, having fallen almost 100% in the year to date. 

  32. Phil, do you expect index future to bounce up or go further down from this point? It's getting too nervous in the world and I am looking to hedge my exposure with future (can't trade options) but not very easy

  33. Sorry, meant to say can't trade ETFs-based options but obviously can play stock options… But this does not change the question.

  34. Futures/Alter – I think the market is going to significantly correct if US and China formally announce a new round of tariffs, maybe 10%+.  Meanwhile though, it's all rumor-driven and very hard to play.  

    For hedging, I like SQQQ, SDS, TZA – plays that are in our portfolios, which I'll be reviewing in great detail this week.

  35. Oh, and any of those can be converted to short plays on DIA, SPY, IWM – if you are so restricted.  

  36. I think it will cost me to sell my shares of HMNY.. 

    After all the last reverse split my shares are worth less than $1… ouch!

    Does anyone have any experience in something like this? 

    Anyone else on the board going to use it as a tax loss???

  37. Thanks, Phil… I think the actual futures is my only option for hedging (except buying puts for some seriously over-bought stocks) as all of those (SQQQ, SDS, TZA, DIA, SPY etc or anything ETF-based or index-based is now out of bounds for Europe-based investors, unless they are "professionals", which is above USD 500k and I am not in this league yet)

  38. I guess we have a few months to hope for a HMNY miracle?

  39. Futures/Alter – Well be careful, those futures can burn you very quickly.

    HMNY/Jabob – The fact that they still exist is encouraging but they can't reverse 100,000/1 inside of 6 months and maintain any credibility.  Being listed on the Nasdaq is not the most important thing they should be worried about! 

  40. Phil, Nice move shorting the Dow !

  41. BHC/Albo

    Three insider buys today

  42. ZTR – Marketwatch listed this as a great dividend play at 12.23%.  That is a great yield but looking at the max timeframe on yahoo finance it appears the stock has been on a long decline since 1994.  Is the yield supposed to make up for that?

  43. Stockbern – And good size too.

    Thanks !

  44. Dow/Albo – Well, it has to work some of the time!   Good way to start the week though.

    Got my /DX long too at 95.0475 – hopefully that will be up tomorrow and 2 /KCN7 @ $107.15 and maybe 2 more in the morning if we're still at $105 to average $106.

  45. Donald Trump Jr. Mocks Sexual-Assault Claim Against Kavanaugh

  46. Oracle first-quarter revenue misses, shares fall

  47. FedEx quarterly profit misses Wall Street estimate

  48. Public Attitudes Toward Technology Companies

  49. Out of Stock This Holiday Season: Store Workers

  50. Good morning!

    Trump did put on $200Bn in tariffs but "only" 10% for now (was 5% anyway) and no reaction from China is giving the bulls a relief rally excuse – even though it's ridiculous to expect immediate retaliation from China – as they were sleeping when Trump made the announcement.  Also, they don't actually take effect until next week – so there's still hope that we negotiate them away between now and then.

    Don't forget, my premise is he's doing it for the money ($50Bn) and has no intention of making a deal with China as this is a stealth tax on the poor that he can turn around and give to the rich while claiming victory for his base - what can be better than that?

    Trump Tariffs to Hit $200 Billion of China Goods on Sept. 24.

    Trump will slap 10% tariffs on $200 billion in Chinese goods — and they will go to 25% at year end.

    Trump Imposes Tariffs On $200BN In China Imports; Will Add Another $267BN If China Retaliates. 

    Dollar hit our goal so be careful:

    /SI coming back nicely:

    Gold, not so much:

    Coffee still sad:

    Oil just blasted higher and I didn't even see why yet:

    And we're back where we started on the Dow but not going to short them again until we see what China says today though I can't imagine they do anything to de-escalate as it would appear weak and there's no benefit to them.

  51. Interesting:

    Billionaire Jack Ma sent out a grave warning regarding the trade war between the U.S. and China: It’s going to last longer and have a bigger impact than most people think.

    China’s richest man said the dispute could last 20 years and persist beyond the presidency of Donald Trump, as the world’s two strongest economic powers battle for global supremacy. China needs to strengthen its economy to deal with the conflict and shift trade relations from the U.S. to regions like Southeast Asia and Africa, the chairman of Alibaba Group Holding Ltd. said during a speech at the company’s investor day conference in Hangzhou.

    “Short term, business communities in China, U.S., Europe will all be in trouble,” Ma said, pacing a stage in an open white dress shirt and punctuating his remarks with forceful jabs. “This thing will last long. If you want a short-term solution, there is no solution.”

    Here's what I see on oil – what nonsense!

    Saudi Arabia is comfortable with Brent oil above $80 a barrel

    Hopefully we get an inventory pop we can short again.