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Just Another Manic Monday

We're waiting on the Fed

The problem is the Fed is having their policy meeting a week from Wednesday and the Fed is entering their quiet period, where they refreain from talking about the markets so we will lose the Fed's talking support for the next week as well – what's going to keep us over 3,000 without endless promises of more Fed easing?  Well, we don't really have to worry about that as we're not over 3,000 anymore anyway – so the pressure is somewhat off though it will now be very easy for us to slip into a bit of a downtrend – in the absence of "good" news.  

We do, of course, have plenty of earnings reports this week, including WHR tonight, CMG tomorrow, BA, T, FB and TSLA on Wednesday, AMZN and GOOGL on Thursday and TWTR and MCD on Thursday – that and about 300 other reports to chew over for the week and not too much data to distract us until Durable Goods on Thursday and GDP on Friday:

All in all, this is a bad lack of news for the President, as we will be finally hearing delayed testimony from Robert Mueller on Wednesday, in what will be telivised testimony to two House Committees, who look for clarity regarding statements made by the Special Investigator in his April Report (yes, it was 4 months ago!).  Democratic House Judiciary Committee Chairman Jerry Nadler on Sunday argued that there was "very substantial evidence" the President was guilty of "high crimes and misdemeanors" — the Constitutional standard for impeachment.  

A CNN poll last month found that 76% of Democrats back the idea of impeaching Trump. But 54% of Americans overall oppose the idea.  Trump, who has claimed he will not watch the testimony, tweeted simply on Sunday: "Presidential Harassment!"  "If we had confidence that the President clearly did not commit a crime, we would have said that," Mueller said. That statement may provide the starting point for many of the questions from Democrats.

Image result for trump russia cartoonOn the whole, expect to see the usual Washington Circus as the Republicans will do whatever it takes to distract from the serious nature of the hearing in order to make this very serious investigation as to whether Trump conspired with the Russians to put himself in power or whether the Russians simply decided on their own that Trump would be a better President for them to manipulate (there is no question at all as to WHETHER the Russians interfered with the election to get Trump elected – only as to whether or not Trump aided and abetted them at the time and whether or not Trump intentially interfered (he certainly intereferred, but was it intentional) with the investigation into the matter once it was discovered).  

The big question is:  "Is the leader of the United States and unwitting Russian dupe or a willing Russian stooge?"  It's a fine line but one means Trump acted incompetently and one means Trump acted treasonously and that will lead to impeachment and that will disrupt the markets so be sure to check your hedges – as it's likely to be a bumpy week!

We're very well-positioned with our hedges and, hopefully, ready for anything.

 


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  1. Good Morning!


  2. Not  a very broad rally:


  3. Phil – I have -7 2020 WHR $155 calls against 10 2021 100/120 call spread and -5 2021 100 puts

    would you wait until after earnings to roll or take advantage of higher premiums before earnings today and if today how would you roll. thanks


  4. Good morning!

    Not broad/StJ – Not at all, 70 stocks have accounted for all the gains on the entire planet.  

    WHR/Coulter – I think WHR is overpriced here and there's still a ton of premium in the Jan $155s at $9, so you don't want to pay that, do you?  It is $7 of 10 though so it's very important that you can withstand a 10% move up to $165 without being in pain that would force you to then make panic decisions.  If that's the case, lighten up but the main adjustment I'd make is that your $20 2021 spread is net $16 and the $120s are $36.50 and the $130s are $31 so for $5.50 I'd buy $10 more of upside, rather than spending money to buy back short calls that are still out of the money.

    Man, those Democrats are way too mature:

    U.S. debt ceiling, budget deal `near final' – CNBC

    • The White House and congressional Democrats are close to a budget deal that would increase the U.S. debt ceiling for two years, CNBC reports, citing a source close to the talks.
    • 10-year Treasury rises, pushing yield down 2 basis points to 2.038%.
    • An agreement to keep the U.S. from hitting its borrowing limit and stop government funding from lapsing is "near final," the person said.
    • This is a developing story. Check here for updates.

    Sprint, T-Mobile rise on new report merger OK is close

    • Sprint (NYSE:S) is up 4.4% and T-Mobile (NASDAQ:TMUSup 1% in early going a day after a Fox Business story echoed other reports that a regulator OK is close for the carriers' $26.5B merger, with a decision that could come by Wednesday.
    • Assuming that talks keep moving as they have been, regulators told the companies they could make a settlement announcement Wednesday or Thursday or even sooner, according to that report.
    • Reading one set of tea leaves, an appearance by antitrust chief Makan Delrahim before the Senate antitrust subcommittee set for Tuesday was canceled.
    • One potential wild card is still Dish Network (DISH +0.6%) chief Charlie Ergen, who's said to have agreed to broad outlines on an asset purchase that John Legere and Marcelo Claure can live with — though a change of heart from Ergen could lead to the Justice Dept. suing to block the deal.

    Bull boosts Apple on Services acceleration

    • Morgan Stanley maintains an Overweight rating on Apple (NASDAQ:AAPL) and raises its target from $231 to $247.
    • Analyst Katy Huberty: "The combination of negative investor sentiment, the potential for a services acceleration in June, and a low bar for September guidance keep us positively biased into earnings."
    • Huberty expects the Q3 services acceleration (the first since March 2018) to serve as "a key catalyst for regaining investor confidence in the Services narrative and multiple re-rating."
    • Apple will report earnings on July 30. Consensus estimates expect $53.39B in revenue and $2.10 EPS.
    • Apple shares are up 0.6% pre-market to $203.80.
    • Apple has an Outperform average Sell Side rating.

    Unexpected decline in chicago fed national activity index

    PetMed Express down 11% premarket on Q1 miss

    Countdown starts for Tesla earnings

    • Sell-side analysts covering Tesla (NASDAQ:TSLA) are busy with earnings due out on Wednesday after the market closes. One of the headliners from the report will be the full-year deliveries forecast from Elon Musk and gang.
    • "We continue to believe that despite the impressive 2Q demand rebound, the ability to hit its aggressive FY19 unit guidance of 360k to 400k will be a Herculean task," notes analyst Dan Ives. Wedbush has a Neutral rating on Tesla and price target of $230 vs. the sell-side average PT of $280.03.
    • Roth Capital Partners isn't riding into the earnings print confident on Tesla, lowering the EV automaker to a Neutral rating from Buy and setting a price target of $238 (8% downside potential).
    • It wouldn't be a surprise if more battle lines are drawn around Tesla ahead of the report.
    • TSLA +0.11% premarket to $258.45.

    TD Ameritrade connects with car systems

    • TD Ameritrade (NASDAQ:AMTDintroduces new offerings for Apple CarPlay, Android Auto and Echo Auto.
    • Apple CarPlay users can use a new TDAN Radio app from the TD Ameritrade Network.
    • Android Auto and Echo Auto users can now use voice commands to unlock market performance summaries and sector updates, hear real-time quotes, and check account balances, and portfolio performance.

    Halliburton tops estimates on strong international demand

    • Halliburton (NYSE:HAL+1.2% pre-market after Q2 earnings topped analyst expectations, as higher international demand for its oilfield services offset weakness in its North American market.
    • HAL's Q2 revenue from international markets jumped 12.5% Y/Y to $2.6B, while revenue from North America, its largest market, fell 13.2% to $3.3B.
    • Oilfield services rival Schlumberger (NYSE:SLB) also reported rising international revenue amid continued North American weakness in its Q2 results issued on Friday.
    • "Momentum is building internationally and activity improvement should continue into 2020," HAL says about the international results, while on North America, the company is "successfully executing our strategy of controlling what we can control and managing our business to perform well in any market conditions."
    • Total Q2 company revenue of $5.9B came in 3.5% lower than the prior-year quarter, as Completion and Production revenue fell 8.6% Y/Y to $3.8B and Drilling and Evaluation revenue rose 7.2% to $2.1B.

    Health Canada grants cultivation license to PharmHouse

    • Canopy Rivers' (OTCPK:CNPOF) joint venture, PharmHouse has received a cultivation licence from Health Canada.
    • PharmHouse, located in Leamington, Ontario will immediately commence its operations in 190,000 sq. ft. of licensed nursery infrastructure and plans to ramp up the entire 1.3M sq. ft. before the end of 2019 to deliver cannabis and cannabis derivative products, both domestically and internationally.
    • PharmHouse has access to plant science, automation, and logistical expertise.
    • PharmHouse has already entered into commercial offtake agreements for a combined 50% of its 2020 production with Canopy Growth and TerrAscend, validating Canopy Rivers' ecosystem model.

    Vail Resorts lands Peak Resorts

    • Vail Resorts (NYSE:MTN) strikes a deal to acquire Peak Resorts (NASDAQ:SKIS) at $11.00 per share or an estimated purchase price of $264M.
    • Vail Resorts will add 17 U.S. ski areas to its network of world-class resorts, including locations in New York, Boston, Washington, D.C., Baltimore, Philadelphia, Cleveland, Columbus, St. Louis, Kansas City and Louisville.
    • CEO update: "Peak Resorts' ski areas in the Northeast are a perfect complement to our existing resorts and together will provide a very compelling offering to our guests in New York and Boston. With this acquisition, we are also able to make a much stronger connection to guests in critical cities in the Mid-Atlantic and Midwest and build on the success we have already seen with our strategy in Chicago, Minneapolis and Detroit."
    • Vail Resorts intends to finance the deal through a combination of cash on hand, its existing revolver facility and an expansion of its existing credit facility. In addition, Vail Resorts will be assuming or refinancing Peak Resorts' outstanding debt.
    • The acquisition is expected to generate incremental annual EBITDA of approximately $60M in FY21, the first fiscal year with the full benefit of the synergies of the acquisition, with additional revenue upside in future years.
    • Shares of SKIS are halted.
    • Source: Press Release

    Iran says it captured U.K. oil tanker

    • Crude oil ticks slightly higher following unconfirmed reports that Iran has seized a U.K.-flagged oil tanker; WTI crude +0.6% to $55.66/bbl, Brent +1% to $62.54/bbl.
    • The British government says it is urgently seeking further information after Iranian state media said the Revolutionary Guard had captured the tanker.

    Amazon hires Trump-connected lobbyist

    • Amazon (AMZN) hired Jeff Miller to lobby for the company as it seeks the $10B Pentagon cloud contract, which will declare a winning bid next month. The Pentagon has named Amazon and Microsoft as the finalists.
    • A regulatory filing shows Miller was hired to lobby on issues related to "cyber security and technology services."
    • Miller was a bundler for President Trump’s 2016 campaign.
    • Related: Yesterday, Trump told reporters he was considering looking into the winner-takes-all JEDI contract after receiving complaints from other companies.

    U.S. rig count continues to drop

    • The number of active U.S. drilling rigs declines by another 4 to 954 after falling by 5 in the previous week, marking the 9th decline in the total count over the past 11 weeks, according to Baker Hughes' latest report.
    • The number of active U.S. oil rigs shed 5 to 779 but gas rigs  grew by 2 to 174; one rig is classified as miscellaneous.

    Judge to cut $2B verdict against Bayer in weedkiller case

    • Bayer (OTCPK:BAYRY +0.8%) welcomes a tentative ruling by a U.S. judge to cut a $2B damages award to a Californian couple by a jury which found that its Roundup weedkiller had caused their cancer.
    • The judge said in yesterday's ruling that she is inclined to reduce the jury's damages award to ~$250M – or down as low as $150M – because the amount is beyond the limits allowed by legal precedent.
    • Bayer will ask the judge to wipe out the verdict or grant a new trial in the case, a request the judge so far has rejected.
    • In a separate case last week, a U.S. federal judge cut a damages award Bayer owed a California man who blamed Roundup for his cancer to $25M from $80M.

    Good news/bad news: Philly Fed strong, leading indicators lose ground

    • For the economic data that did come out this week, the focus has been — is it weak enough to warrant a rate cut when the Fed's monetary policy-setting arm meets on July 30 and 31? Or is it showing renewed strength that will lead the Fed to hold off on any actions?
    • A couple of economic readings that take reflect more recent business activity, for examples the July Philly Fed business outlook and the July Empire State survey both exceeded expectations.
    • Still, more data points this week seem to be weaker rather than stronger than expected.
    • Stronger-than-expected: July Philly Fed business outlook, at +21.8, roared past the +5 consensus and resurged from +0.3 in June.
    1. July Empire State survey of 4.30 beat the +0.8 consensus and reversed from the decline of 8.60 in June.
    2. This week's continuous jobless claims fell more than expected, by 42K to 1.686M vs. 1.700M expected and 1.728M prior.
    3. June core retail sales rose 0.4%, stronger than the 0.2% increase expected and matched the May pace; the headline increase of 0.4% compared with the +0.1% consensus.
    1. July consumer sentiment at 98.4 fell short of the 98.6 estimate, though it did strengthen from 98.2 in June.
    2. June leading indicators unexpected lost ground, falling 0.3% to 111.5 vs. consensus of +0.1% and vs. flat in May.
    3. June housing starts, down 0.9% to 1.253M, disappointed vs. consensus of 1.260M; however, May's figure was revised upward to 1.269M from 1.265M; building permits also fell short at 1.220M vs. 1.300M expected and 1.299M in May.
    4. June industrial production came in flat at 109.6, weaker than the expectation of a 0.1% increase, and down from its 0.4% increase in May; capacity utilization at 77.9% trailed the consenus of 78.2% and fell from 78.1% in May.
    5. June import prices fell 0.9% M/M, more than the -0.7% consensus and the 0.3% decline in May; export prices, down 0.7%, also came in significantly below the 0.2%% decline expected.
    6. Last on the list is May business inventories, up 0.3% to $2.036.4B, didn't live up to the 0.4% increase expected and weakened from the 0.5% rise in April; inventory/sales ratio increased to 1.39 from 1.34 a year ago.
    • Coming up next week: On Tuesday, June existing home sales; on Wednesday, July manufacturing and services PMI, June new home sales; on Thursday, June durable goods orders and goods trade balance; on Friday, initial Q2 GDP reading and Michigan consumer sentiment.



  5. AP FACT CHECK: Trump team warps Omar words on 9/11, al Qaida



  6. Iran detains 17 citizens accused of spying for the CIA




  7. That Vail (MTN) news is interesting because the Kaatskill Mountain Club, where I have a condo, at the base of the mountain in Hunter, NY, is selling very cheaply but rents out very well – if you like those sort of things.  It's often a good boost to values when Vail takes over a resort (but it takes a while to play out).  Also, we got our first casino in the area but it's 45 mins away – waiting for one to be built closer.

    Through the acquisition, Vail Resorts will add 17 U.S. ski areas to its network of world-class resorts. Located near major metropolitan areas, including New York, Boston, Washington, D.C.BaltimorePhiladelphiaClevelandColumbusSt. LouisKansas City and Louisville, the resorts include:

    • Mount Snow in Vermont
    • Hunter Mountain in New York
    • Attitash Mountain ResortWildcat Mountain and Crotched Mountain in New Hampshire
    • Liberty Mountain ResortRoundtop Mountain ResortWhitetail ResortJack Frost and Big Boulder in Pennsylvania
    • Alpine ValleyBoston Mills, Brandywine and Mad River Mountain in Ohio
    • Hidden Valley and Snow Creek in Missouri
    • Paoli Peaks in Indiana

    "We are incredibly excited to have the opportunity to add such a powerful network of ski areas to our Company," said Rob Katz, chairman and chief executive officer of Vail Resorts. "Peak Resorts' ski areas in the Northeast are a perfect complement to our existing resorts and together will provide a very compelling offering to our guests in New York and Boston. With this acquisition, we are also able to make a much stronger connection to guests in critical cities in the Mid-Atlantic and Midwest and build on the success we have already seen with our strategy in ChicagoMinneapolis and Detroit. The acquisition fully embodies our philosophy of Epic for Everyone, making skiing and riding more accessible to guests across the U.S. and around the world."

    When the transaction closes, the 2019-20 Epic PassEpic Local Pass and Military Epic Pass will include unlimited and unrestricted access to the 17 Peak Resorts ski areas. Guests with an Epic Day Pass will also be able to access the new ski areas as a part of the total number of days purchased. For the 2019-20 season, Vail Resorts will honor and continue to sell all Peak Resorts pass products, and Peak Resorts' pass holders will have the option to upgrade to an Epic Pass or Epic Local Pass, following closing of the transaction.

    • Epic Local Pass™: For $699 for adults, $569 for teens (ages 13 to 18) and $369 for children (ages five to 12), the Epic Local Pass offers the following access and benefits:

      • Unlimited, unrestricted access to: BreckenridgeKeystoneCrested Butte, Okemo, Mount SnowMount Sunapee, Attitash, Wildcat, Crotched, Hunter, Liberty, Roundtop, Whitetail, Jack Frost, Big Boulder, Stevens PassAlpine ValleyBoston Mills, Brandywine, Mad RiverHidden ValleySnow Creek, Paoli Peaks, Afton Alps, Mt. Brighton, and Wilmot.
      • Unlimited access with holiday restrictions to: Park City, Heavenly, NorthstarKirkwood, and Stowe.
      • 10 total days combined (with holiday restrictions) at: Vail, Beaver Creek, and Whistler Blackcomb.
      • Limited access to partner resorts, including: two days (with limited holiday restrictions) at Sun Valley; two days (with limited holiday restrictions) at Snowbasin; and five total consecutive days with no blackout dates at Hakuba Valley's ten ski resorts in Japan; and five total consecutive days with no blackout dates at Rusutsu Resort.
      • Discounted Tickets: Six "Ski With A Friend" discounted tickets.

    That's very worth it if you ski a lot!  

    Year End 31st Jul 2013 2014 2015 2016 2017 2018 TTM 2019E 2020E CAGR / Avg
    Revenue $m 1,121 1,255 1,400 1,601 1,907 2,012 2,239 2,268 2,421 +12.4%
    Operating Profit $m 97.0 106.4 199.5 283 379.3 408.8 483.9     +33.4%
    Net Profit $m 37.7 28.5 114.8 149.8 210.6 379.9 307 288.2 332.2 +58.7%
    EPS Reported $ 1.03 0.77 3.07 4.01 5.22 7.66 7.30     +49.5%
    EPS Normalised $ 1.05 0.98 3.00 4.10 5.41 7.73 7.33 7.09 8.08 +49.1%
    EPS Growth % +121.8 -6.9 +207.2 +36.8 +31.8 +43.0 -10.8 -8.32 +14.0  
    PE Ratio x           29.2 30.8 31.8 27.9  
    PEG x           n/a n/a 2.27 2.92
    Profitability

    MTN is $9Bn at $230 so not particularly cheap to earnings but a very solid operator.

    I also like my Grand Residence Club condo, which is a Marriott at Tahoe – that one I generally trade for weeks elsewhere but it turned out to be a great deal for us as another company owned it when we bought it and then Marriott took over and we hit the jackpot.


  8. Indexes not looking very healthy other than Nas, which is up 0.75%.  

    Certainly not because of NFLX, which is down 2.8% – getting worse and worse for them. 

    AAPL up almost 2%, that's helping the Nas. 


  9. Vail/Phil – so the Indiana property is for cross-country skiing? ;)


  10. CMG having second thoughts about $750


  11. You can sell CMG Sept $750 calls for $34.50 – that's very tempting!  There's really no good way to hedge it though you could take the 2021 $725 ($145)/$800 ($112) bull call spreads at $33 and, if all goes well, the short calls expire worthless and you then keep whatever value is left on the 2021 spread.  Still though, you have to have faith they won't blow over $800 on earnings and, that being the case, I'd rather just do the naked short calls though too risky for our portfolios.








  12. Our Fed may be quiet but others are filling in the gap:

    • Though the Japanese economy in no longer in deflation the country's central bank will "persistently continue with powerful monetary easing" to move toward achieving its 2% inflation goal, said Bank of Japan Governor Haruhiko Kuroda in a lecture at the International Monetary Fund.
    • The yen slips 0.2% against the U.S. dollar and is trading at ~107.9 per U.S. dollar.
    • Japan's annual CPI inflation is now in the 0.5%-1.0% range.
    • The BoJ will be keeping a close eye on uncertainties about the global economy and increased nervousness in global financial markets.
    • "We will carefully examine various risk factors, in addition to developments in economic activity and prices as well as financial conditions, and weigh the benefits and costs of the policy effects," he said. "In this way, the bank will continue to conduct its policy in an appropriate manner."
    • Citing regulatory uncertainty about the timing of the 737 MAX's return to service, Fitch Ratings has lowered its outlook on Boeing (BA -0.6%) to Negative from Stable.
    • The ratings agency believes the MAX will remain a concern throughout the aviation sector into 2020 and expects a lingering impact on Boeing's operating margin for several years after it heads back to the skies.
    • MGM Resorts (MGM -0.7%) is being sized up after sources told Bloomberg late last week that the company is talking to advisors about a potential sale of the MGM Grand and Bellagio.
    • If the deal goes off, MGM is forecast to raise as much as $5B in after-tax proceeds.
    • The casino operator is seen by Macquarie redeploying the capital for share buybacks and improve the leverage ratio.
    • MGM is rated at Outperform by Macquarie with a price target of $34 vs. the average sell-side PTof $33.13.
    • Summarizing universal and trust banks' Q2 performance (excluding Northern Trust, which reports on Wednesday), Wolfe Research analyst Steven Chubak sees 2020 consensus for most of them still too high.
    • "One of the key issues we found was that the banks were unwilling to provide NII guidance beyond 2019," Chuback wrote in a note to clients.
    • That's setting them up to disappoint down the road.
    • Greatest risk is Wells Fargo (WFC -0.5%), he wrote.
    • Prefers Goldman Sachs (GS -0.3%) (top pick), Citigroup (C), and Bank of America (BAC+0.2%).
    • Remains underweight on trusts, however, short case isn't as strong "given significant YTD underperformance and better-than-expected Q2 results."
    • Tickers for trust banks: State Street (STT -1.7%), Bank of New York Mellon (BK -0.1%), Northern Trust (NTRS +0.1%).
    • Aimed at slowing the rapid rise in youth e-cigarette use, the FDA is debuting its first TV ads as part of its "The Real Cost" Youth E-Cigarette Prevention Campaign.
    • The new advertisements, called “Magic,” feature Julius Dein, a popular street magician, who has appeared in online videos with a number of celebrities. In the ads, the social media personality magically turns a teen’s e-cigarette or vape into a cigarette in front of their eyes, showing that e-cig use can lead to traditional tobacco cigarette use.
    • The campaign, launched in September 2018, also includes posters for high schools and educational materials for middle schools.
    • The agency says ~10.7M U.S. kids aged 12-17 have used e-cigs are are open to trying them.
    • Selected tickers: (MO -1.1%), (BTI -0.8%), (OTCPK:GLLA), (OTCQX:IMBBY -1%), (OTC:AHII), (VGR -0.5%), (JUUL)


  13. DVA – buy back stock with part of the 4.3 B it received from sale dr. office ….

    Best Idea DaVita Reports Decent Preliminary 2Q Results, Dutch Auction Tender for Shares

     

    Jake Strole

    Equity Analyst

     

     

     

     


  14. DVA from morningstar

    On July 22, narrow-moat DaVita announced select metrics from its upcoming second-quarter release and boosted its operating income guidance for the full year. In addition, the firm announced its intent to tender $1.2 billion in stock through a Dutch auction process. We don't expect to adjust our $79 fair value estimate just yet, but we will reassess our outlook when the firm posts its full earnings release Aug. 1. 

    We applaud management's decision to aggressively buy back stock at a severely discounted valuation. The repurchase program will be completed at a price between $53.50 and $61.50, depending on how shareholders elect to tender, which at the high end of the range would account for nearly 12% of the firm's equity.


  15. Trump simply can't let it go:

    The “Squad” is a very Racist group of troublemakers who are young, inexperienced, and not very smart. They are pulling the once great Democrat Party far left, and were against humanitarian aid at the Border…And are now against ICE and Homeland Security. So bad for our Country!

    Fed choices for July:

    • 1. Don't cut and risk market wrath
    • 2. Cut 25bp and disappoint some & risk more beatings from
    • 3. Cut 50bp & risk comparisons to 2000/2007 + loss of credibility i.e. data dependent/Fed independence.

    Yikes:

    It is therefore time for the European Central Bank to improve private sector growth prospects by expanding its quantitative easing programme to include equity investments in European companies. 

    A key part of the solution would be to stimulate a demand for capital, not to further lower the cost of debt. Having nearly exhausted its options on the debt side, the ECB should consider expanding QE to include equity investments to lower the cost of equity for European enterprises.

    That could narrow the abnormally large spread between the cost of capital and the economic growth rate. Lowering the cost of equity would stimulate growth through organic channels of investment, including research and development, which can provide durable economic gains.

    And who is that article written by?

    Rick Rieder is BlackRock’s chief investment officer of global fixed-income

    See, they can't find any more retail bag-holders and they want the CBs to step in and bail them out already.

    Goldman Sachs Group thinks the S&P 500 Index is now trading near its fair value, with limited further upside after its 19% climb so far this year

    Liquidator: “We’ve been the busiest we’ve ever been in our history.” Retailers vacated US shopping centers at the fastest pace in at least nine years in Q2 as online shopping and collapse of debt-laden chains begin to hit the commercial property market.

    Mystery as 50 dead whales found washed up on remote beach in Iceland https://www.thesun.co.uk/news/9552039/d

    The cutoff to rank among the world’s 50 most valuable sports teams is $2.075 billion, up $125 million from last year and $1.2 billion from 5 years ago https://www.forbes.com/sites/kurtbade


  16. Nas seems to be keeping things floating.  6/11 S&P sectors are red but index is overall green.

    • British hedge fund Odey Asset Management says it will vote in favor of Barrick Gold's (GOLD+0.8%increased offer to buy out Acacia Mining.
    • The approval comes after Odey previously said it would reject any offer from Barrick for its stake in Acacia (OTCPK:ABGLF) that is considered "best and final."
    • Meanwhile, the miner is close to settling a three-year long $80M tax dispute with Mali's government, CEO Mark Bristow says, adding the miner expects to conclude the mediation process soon.
    • The government has said a bullion bank that sold gold produced by Randgold Resources from the Loulo-Gounkoto gold complex in Mali owed $80M in back taxes.
    • Loulo-Gounkoto has delivered the greatest production improvement in Barrick's global portfolio and is on its way to achieve 2019 production guidance of 690K oz. of gold, Bristow says.

    OMG, this never stops:


  17. Phil,

    Any opinions on Jan 21 75/90 call spread on CELG? The acquisition price is supposed to be around $102 and it is supposed to happen late 2019 or early 2020. Do you see possibilities of this unraveling?

    Thanks,



  18. CMG earnings play – options pricing in a +/- $45 move. So that's touching close to $800 or $700. They'll need some items for a great story to push it to the upside, pick any from:

    Online sales knocking it out of the park

    Tailor made promotions/menu items resonating with consumers

    Board authorizes additional stock buybacks

    Increased expansion in number of restaurant outlets

    Without some new story lines to tell, it's more likely it moves closer to $700 than $800.

    But gambling on CMG at earnings time can only be done using funny money (I don't have any left :) )


  19. Winston / CMG gambling on earnings - AMEN


  20. CMG/Winston – I'm firmly in the $650 camp.  Current levels can't be justified. 

    Nas keep plowing higher but other indexes skimming the line.  RUT about to turn red.  

    AAPL up over 2% now at $207.

    /SI mostly recovering but not /YG

    /KC makes a nice play at $105.


  21. Well WHR shot up to 156 and now back to 146. I couldn’t get a good price to roll up to 130 but that idea makes good sense. Same as the spend 5 to get 10 roll down on puts rule right





  22. Good morning!  

    UTX pushing the Dow higher as they beat and raise.  They just bought Rockwell so comps are tricky in this case but people are loving it.  Thjey say they'll be good for $8/share so a long way to run before they are overpriced but they are now merging with RTN and spinning off Otis and Carrier – so very hard to gauge the value – though I wish we'd grabbed them in Dec – that was a no-brainer.

    Rumors are Mnuchin and Lighthizer will go to Beijing next week but, if they were serious about making a deal, they'd leave Lighthizer home!

    WHR kicked ass but, as I noted yesterday, they already ran well above fair value so all they are doing is justifying where they are.  Still, very solid performance and good guidance so they will eventually break higher if the market stays strong.