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Thrilling Thursday – Back Over S&P 3,000 as the ECB Eases

NEGATIVE 0.5%!

That is now the European Central Bank's Deposit Rate.  That's 2.6% lower than our Fed's current 2.1% rate and 0.75% lower than our all-time low of 0.25% (and you thought we couldn't go to zero!) back in the throes of the Recession.  As you can see from the bottom of the Fed's historical rate chart – this has never happened before in the history of the World so don't listen to people who tell you that they know what is going to happen in a negative-rate World – no one has any friggin' idea what is actually going to happen when we go below the zero line…

We've had Recessions, Depressions, Hyper-Inflation and even Deflation in Human Economic History but we have not had a situation in which rich people (Banksters) CHARGE YOU money for holding your money.  And they are not HOLDING it, you are lending it to them and they are using it to make more money (as Jimmy Stewart explains) – they don't even HAVE your money – IT's GONE!!!  

Negative rates sent the Euro plunging lower (if you have 100 Euros, and you put it them the bank for 10 years, you get back 95 Euros), which will not make Trump happy, as he wants a weak Dollar to inflate the value of his real estate assets so he will pressure the Fed to lower our rates further, so Trump can then borrow money at lower rates to buy more buildings and, of course, the US Taxpayers pay the bill for all these artificially low rates through gigantic deficits and Putin wins again – but there's no collusion – things just work out for him… all the time.  

In fact Russia has been hoarding gold and dumping US assets – almost as if they knew what Trump was going to do.  Russia has been the World's largest buyer of gold recently with the value of their reserves climbing 42% in the past year alone.  “Russia prefers to cushion its macroeconomic stability through politically neutral tools,” said Vladimir Miklashevsky, a strategist at Danske Bank A/S in Helsinki. “There is a massive substitution of U.S. dollar assets by gold — a strategy which has earned billions of dollars for the Bank of Russia just within several months.” 

Image result for trump putin puppetRussia needs that money to hire more hackers but, fortunately, everyone has already forgotten the part of the Mueller Report that CONCLUSIVELY showed that Russia did indeed hack the US elections to put Trump in office and even Marco Rubio said that Russia was in a position to “change voter registration files in 2016,” and the Mueller revelation that a major Florida software vendor, VR systems, which operates in most Florida counties and seven other states, was “hacked by Russia" and that they did it again in 2018 for other Republicans and they plan to do it again in 2020.  

Neither President Trump or "Moscow" Mitch McConnel have allowed any bills to pass Congress to address the election interference problem and why would they – Trump is the least popular sitting President since Nixon and McConnel is the least popular sitting Senator with just 36% of the people in his own state approving of him so he needs all the Russian help he can get if he wants to be re-elected to continue to keep our Government from functioning.  

Even key findings at the beginning of the report were heavily redacted.25 Russians have been indicted by Mueller for interfering in US elections but, unfortunately, Trump has done nothing to extridite them and they all remain at large in Russia, almost certainly still doing the same job they did in 2016 and 2018 including hacking Demorcratic computers (like Hillary's Emails at Trump's request), "aggravated identity theft", money laundering, "conspiratcy to defraud the US to interfere with elections", wire fraud, bank fraud and voter fraud.  As you can see, the Senate Report, which found extensive interference, was so redacted by Republicans that it became useless as a tool to protect ourselves from additional inteference.  

One section on recommended action was almost completely redacted.The deletions were so substantial that even the committee’s recommendations for the future were not spared: The section heading on the final recommendation read “Build a Credible,” but the remainder of the heading, and two paragraphs that follow, were blacked out.  I wish this were a joke but it's actually happening to us right now and the fact that you are surprised to read this shows how dangerously unprepared McConnel and the other Senate Republicans have left us going into the 2020 election.

“This is not a Democratic issue, a Republican issue,” said Senator Chuck Schumer of New York, the Democratic leader. “This is not a liberal issue, a moderate issue, a conservative issue. This is an issue of patriotism, of national security, of protecting the very integrity of American democracy, something so many of our forbears died for.  And what do we hear from the Republican side?” he said. “Nothing.”

Image result for us election interferenceThe simplest solution to election fraud (not voter manipulation, just direct fraud) is to go back to paper ballots of have paper back-ups to electronic systems but no money has been approved to do ANYTHING to address the issue other than $380M that was approved in the 2017 budget that Trump had to sign under duress – that's $1 per citizen to ensure your vote is counted.  

Now, you can go do nothing and go through the charade of voting and pretend it all matters next year or you and WRITE TO YOUR CONGRESSMEN and DEMAND that they DO SOMETHING about this.  Just say, what are you doing to ensure the 2020 elections will not be interferred with?  If they begin to get the impression the voters actually care, we might get enough of them on our side to override Mitch McConnel's next attempt to block the United States from stopping Russia's interference – maybe…

Image result for us election interference

 


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  1. Phil / Wow that's strange – your post did not continue.    It stopped at Neither President T….


  2. Phil – The push back of increased tariffs on both side said has so far not popped the market as much as I thought it would …..   is this a case where we're hitting the high in the channel and 'all good new' is about priced in.  Should we be adding any more hedges here ?    

    Or  might it be that Trump is lining up his 'win.   Anyway it seems not coincidental that the market will. be at an all time high when the Dems debate tonight.   I'm still of the belief that Trump will close the trade issue prior to election ( and not gain anything but still claim victory and pop markets.   Just like he did with NAFT 2 we gained a minuscule amount, gave into concession on drug IP protections ….


  3. There is some rotation going on!


  4. President T…  If we were in Russia, we might need to go check on Phil's health now for not completing his sentence criticizing the president.


  5. I am pushing my trip to Europe back and waiting for the euro to below the dollar. Shouldn't be long now.


  6. Thinking along those lines, Stjean. If the Euro hits .80 or so I probably won't be able to afford NOT to buy a house overseas, get that dual citizenship, have decent healthcare…


  7. Some interesting stats:

    https://awealthofcommonsense.com/2019/09/what-to-make-of-a-stock-market-that-has-gone-nowhere-for-a-year-and-a-half/

    So the current market environment has been child’s play by historical standards. Volatility is nothing new. Neither are losses. This is how the stock market has always functioned. It hasn’t always been easy to invest in stocks over the past decade or so because there have been plenty of naysayers for the entire run-up in prices. But investors have yet to experience a long-lasting period of volatility since the financial crisis.

    Investors have had it pretty good for some time now. It will be interesting to see if this period will lead to a sense of complacency when the next prolonged bout of turbulence does hit. In the immortal words of the Bachman-Turner Overdrive: “You ain’t seen nothin’ yet.”


  8. Dual / Atitlan – I am there with the citizenship already and might need less money to retire so plans might change. As far as healthcare is concerned, my sister who lived in Barcelona for 20 years was just telling me that she used to pay 400 euros for great private health insurance for her family there with excellent private clinics and doctors. That's going to be $200 soon :-)

    Maybe Advill can add more recent information on that topic!


  9. Phil – Two weeks ago I put together a hypothetical portfolio of $3 and under stocks.  (Not purely hypothetical as I own many of those dogs).

    As of yesterday's close the portfolio is up 25.4%.  Best performers were CBL up 94%, and RRD up 56%   Only two losers.

    Pretty random, but a fun exercise.


  10. Good Morning!


  11. Cool stuff Albo! Maybe there is a rotation into dogs :-)


  12. Yes, STJ.

    BTW, Phil's FTR was up 54% !


  13. And CTL is up only 25% it seems! But of course, never made it under $3 :-)


  14. And not complaining that it didn't!


  15. Funny that oil is going down because we might ease sanctions on Iran simply to get a meeting! That sounds like something straight from The Art of the Deal there… But easing sanctions to get a nuclear deal was being outsmarted on the other hand. Must be upside down presidency!






  16. Good morning! 

    There's talk of an interim trade deal with China to delay further tariffs so the market is getting a lift.

    Post/Batman – I just happened to do a save there while I was still writing.  As to the market being subdued – the Dollar did a big pop but has now dropped back 0.6% and up we go as the Euro goes up and down on Draghi's all over the place comments. 

    • Speaking at his press conference following the ECB rate cut and restart of QE, Mario Draghi say the economic risks remain titled to the downside.
    • The ECB staff also cut its growth and inflation forecasts across the board, with inflation in 2021 now seen at 1.5%.
    • Live feed here
    • The euro (NYSEARCA:FXE) is adding to losses against the dollar, now down 0.65% for the session. The Stoxx 50 (NYSEARCA:FEZ) has pushed its gain for the day to just more than 1%.
    • Previously: ECB trims rates, restarts QE (Sept. 12)

    Russia/StJ – If we were in Russia, I doubt I'd still have this job but, if it's up to Trump, we won't be able to keep dissenting either. 

    "I would never kill them but I do hate them,” he said of reporters. “And some of them are such lying, disgusting people.”

     

    Trump has:

    1. Praised a violent attack on a reporter by Montana Rep. Greg Gianforte.
       
    2. Presided over a Justice Department investigation in which years' worth of email and phone records belonging to a New York Times reporter were seized in connection with a leak investigation.
       
    3. Threatened to change libel laws to make it easier to sue publishers and news organizations following the release of an unflattering book.
       
    4. Threatened legal action against a journalist and publisher over a book that includes critical statements about him.
       
    5. Demanded the Washington Post fire a reporter over an inaccurate tweet about the crowd size at a Trump rally, which the reporter apologized for and deleted.
       
    6. Urged people to sue ABC News over a retracted report, which Trump claimed caused the stock market to fall and investors to lose money.
       
    7. On the day that Russia enacted restrictions on foreign news outlets, tweeted: “CNN International is still a major source of (Fake) news, and they represent our Nation to the WORLD very poorly. The outside world does not see the truth from them!” He then called for a contest between CNN and other outlets, apart from Fox, to see which has “the most dishonest, corrupt and/or distorted in its political coverage of your favorite President (me).”
       
    8. Said it is “frankly disgusting the way the press is able to write whatever they want to write” in a meeting with Canadian Prime Minister Justin Trudeau.
       
    9. Threatened to cancel the broadcast licenses of media companies that offer negative coverage of him.

       

    10. Had the White House press secretary, Sarah Huckabee Sanders, call on ESPN to fire Jemele Hill for criticizing him.
       
    11. Tweeted mocking images of him wrestling a CNN reporter and his campaign hitting a CNN reporter with a train.
       
    12. Overseen a Justice Department review of policies for subpoenaing media organizations in an effort to crack down on both whistleblowers and journalists. As of November 2017, investigations of leaks by the department reportedly grew 800 percent under Jeff Sessions.
       
    13. Pledged to “fight the #FakeNews” with a Polish leader hostile to press freedom.
       
    14. Attacked reporters while speaking with Russian President Vladimir Putin, who has fostered a climate of violence against journalists.
       
    15. Said that his mission to “drain the swamp” begins “with the Fake News!

       

    16. Reportedly asked then-FBI Director James Comey to jail reporters who publish classified information.
       
    17. Tasked his former chief of staff with looking into changing the country’s libel laws.
       
    18. Explored the prosecution of WikiLeaks for publishing CIA and State Department materials.
       
    19. Labeled the “fake news” media “the enemy of the people.”
       
    20. Accused the media of lying about his “very nice” conversation with the Australian prime minister. Ultimately, a leaked transcript of the call showed it was Trump who was lying.
       
    21. Urged someone to buy the New York Times to “either run it correctly or let it fold.”
       
    22. Said members of the “Fake News & totally dishonest Media” have “become crazed lunatics who have given up on the TRUTH!”
       
    23. Threatened to pull credentials of reporters who write “negative” stories about him while admitting he considers negative media coverage to be “Fake”: “91% of the Network News about me is negative (Fake). Why do we work so hard in working with the media when it is corrupt? Take away credentials?”
       
    24. Called for a federal investigation into “Saturday Night Live” after watching a rerun of an episode parodying him.
       
    25. Wondered why “the Networks get away with these total Republican hit jobs without retribution?”
       
    26. Tweeted that the “Fake News is the absolute Enemy of the People and our Country itself!”
       
    27. Unsuccessfully tried to rescind the press credentials of CNN journalist Jim Acosta.
       
    28. Said that he is “entitled” to have “great” stories published about him in the New York Times.
       
    29. Lauded Brazil’s authoritarian president for denouncing the “fake news.”
       
    30. Announced plans to boycott presidential debates held by “Fake News Networks.”

    I doubt you could compile such an extensive list about Putin!  

    Euro/StJ – Just wait for it to break up – then pennies on the Dollar. 

    Overseas/Ati – You can do it in Spain now or Portugal – very cheap.  

    And what StJ said.

    Cheap stocks/Albo – Good time to do that with the RUT blasting higher. 

    That's another new thing Trump is doing by the way – we've never had a President or Administration directly support a Weak Dollar Policy before.  Clearly they don't want it to get back over 100:


  17. Morning, All!

    Had a couple technical difficulties this morning, but the webinar replay is now up!

    https://youtu.be/dhas3kxhH5Y


  18. Phil / SPWR – I'm long 20 Jan20 BCS comprised of $7 call ($2.74) / $17 call ($1.02), which was financed with a  short put that was closed last month. As we approach expiration and the market teeters on the edge…. my options are: 1) do nothing, 2) close the spread, 3) sell the 20 Jan20 $7 calls @ ~ $5.65 and open 30 Jan21 BCS comprised of $10 (~$4.25) / $17 (~$1.80). If SPWR share price falls, I can roll the long calls down in strike and sell puts to finance. Long term I think SPWR will move up in price, however the next six months are very questionable. 4) Any other idea's?  Thank you, Eric


    • Keeping us waiting for nearly a full 30 minutes, the president is out with his reaction to this morning's rate cut and restart of QE by the ECB.
    • "[The ECB is] trying, and succeeding, in depreciating the euro against the VERY strong Dollar, hurting U.S. exports," says Trump. "The Fed sits, and sits, and sits."
    • "They get paid to borrow money, while we are paying interest!"
    • Kind of as expected, the ECB cut its deposit rate by 10 basis points to -0.50%.
    • Alongside, QE will be restarted on Nov. 1 to the tune of €20B per month – that amount might be a bit of a disappointment to those looking for something more dovish. On the other hand, the QE program is open-ended, and that's going to excite the dovish fans.
    • The euro (NYSEARCA:FXE) is volatile, but heading modestly lower in the minutes since the decision was announced. European stocks (NYSEARCA:FEZ) are adding to gains, the Stoxx 50 now ahead 0.7%.
    • The ECB minutes ago announced a restarted QE program. The monthly amount (€20B) isn't that exciting, but the fact that the bond-buying is open-ended (i.e. no end date or total amount set) seems very dovish.
    • The Italian 10-year government bond yield is down a whopping 16 basis points to a new record low of 0.80%. The German 10-year Bund yield is off seven basis points to -0.63%.

    • August Consumer Price Index+0.1% in-line with consensus, +0.3% prior.
    • Core CPI +0.3% vs. +0.2% consensus, +0.3% prior.
    • On a year-over-year basis, headline inflation is now at 1.7%, in-line with consensus and 1.8% previously. Core inflation is now running 2.4% vs. 2.3% expected, and 2.2% previously.
    • In line with the easing party taking place across the globe, Turkey's central bank has slashed its interest rates by 3.25 bps, cutting its key rate to 16.5% from 19.75%.
    • "Recently, advanced economy central banks have started to adopt more expansionary policies as global economic activity weakened and downside risks to inflation heightened," according to the central bank.
    • It's Turkey's second marked policy easing in two months as it seeks to boost a recession-hit economy in which inflation has recently eased.
    • Bloomberg is reporting Trump administration discussions about a interim trade deal with China that would delay or roll back some U.S. tariffs in exchange for Beijing helping out with intellectual property and some ag buys.
    • It's more or less about the 100th repeat of what's now becoming a near-daily event, but that's enough to have some hitting the buy button. The S&P 500 (NYSEARCA:SPY) has moved from flat to up 0.5%, and the Nasdaq (NASDAQ:QQQ) to up 0.8%.
    • Rising food and fuel prices, and a disruption of cross-border financial services, are among the possible consequences of a no-deal Brexit, according to a secret file the U.K. government was force to publish on Wednesday evening.
    • The content of the five-page document, code-named Operation Yellowhammer, is similar to the plan leaked last month to the Sunday Times, but was dismissed by the government as out of date.
    • Where that paper was described as a "base case," the new file claims to be a "worst-case scenario."
    • See the full document here

    Natural gas inventory builds slightly less than consensus

    Amazon bull sees international Prime potential

    • Jefferies analyst Brent Thill says Amazon's (AMZN +1.6%) growth could accelerate with an overseas Prime membership push.
    • Thill notes that overseas penetration remains low and thinks the expansion into Brazil as a sign Amazon is focused on this strategy.
    • Thill: "Increased Prime adoption will remain key to AMZN driving growth across the non-AWS businesses."
    • Jefferies maintains a Buy rating and $2,300 price target. Amazon has a Buy average Sell Side rating.

    Wynn Resorts warns on Macau trends

    • Wynn Resorts (NASDAQ:WYNN) discloses in a filing with the Hong Kong Stock Exchange that it expects Q3 Macau operations' casino revenue and adjusted property EBITDA to be negatively impacted by "significantly lower VIP gaming turnover." The company says the lower action is due in part to the ongoing U.S.-China trade dispute and disruptions in Hong Kong SAR.
    • The casino company sees July-August total operating revenue of $1.01B to $1.12B vs. $1.15B a year ago and adjusted property EBITDA for the July-August of $225M to $248M vs. $339M a year ago.
    • Shares of Wynn are up 1.46% premarket to $115.99.

    U.S. becoming world's top oil exporter – IEA

    • "Booming shale production has allowed the U.S. to close in on, and briefly overtake, Saudi Arabia as the world's top oil exporter," the IEA said in its closely-watched monthly report.
    • It comes at a time when the U.S. is actively pursuing "energy dominance," putting downward pressure on prices at a time when the market is already struggling to cope with too much supply.
    • "The installation of the necessary pipelines and terminals is continuing apace, which will ensure that the trend continues."
    • Oil pared an earlier slump as the U.S. postponed China tariff increases by two weeks, while traders continue to watch the World Energy Congress in Abu Dhabi for any headlines that could move prices.
    • OPEC+ is scheduled to hold its ministerial monitoring committee meeting on the sidelines of the conference that includes Saudi Arabia's new oil minister.
    • "To achieve market stability, it's important we sustain a high level of cohesiveness," Prince Abdulaziz bin Salman said ahead of gathering.

    • Air fares in the U.S. rose 1.7% in August on a month-to-month comparison, according to data compiled by the Bureau of Transportation Statistics. Fares continue to recover after a string of down months following the Boeing 737 Max grounding ended in July with a 2.3% increase.
    • Air fares were up 1.6% in August compared to a year ago on an unadjusted basis.
    • BTS data
    • Related ETF: JETS

    Deutsche Bank likes CVS Health, sees 42% upside

    • Deutsche Bank's George Hill updates his ratings on the healthcare services space:
    • New buys: CVS Health (NYSE:CVS) ($91), Anthem (NYSE:ANTM) ($323), Cigna (NYSE:CI) ($62), Molina Healthcare (NYSE:MOH) ($145), eHealth (NASDAQ:EHTH) ($173), HealthEquity (NASDAQ:HQY) ($74), Teladoc (NYSE:TDOC) ($76).
    • New holds: UnitedHealth Group (NYSE:UNH) ($263), Humana (NYSE:HUM) ($300), AmerisourceBergen (NYSE:ABC) ($91), Cardinal Health (NYSE:CAH) ($50), McKesson (NYSE:MCK) ($155).
    • New sells: Walgreens Boots Alliance (NASDAQ:WBA) ($53), Diplomat Pharmacy (NYSE:DPLO) ($4).
    • GE's (GE +1%) health unit has won FDA approval for a new artificial intelligence-powered X-ray device that reduces the time to diagnose and treat a collapsed lung from eight hours to as little as 15 minutes.
    • The device, called the Critical Care Suite, uses AI algorithms to scan X-ray images and detect pneumothorax, which affects approximately 74K Americans each year.
    • GE is also working to enhance the technology to detect other health conditions.
    • A tender offer from General Electric (GE -0.4%) will buy back up to $5B worth of its existing debt, including up to $2.5B of U.S. dollar-denominated debt and up to $2.5B of euro-denominated debt.
    • The repurchase represents the next step in the company's stated strategy to "strengthen its balance sheet and achieve a GE Industrial leverage target of <2.5x net debt/EBITDA," according to a press release.

    Morgan Stanley downgrades online poker

    • Morgan Stanley reduces price targets on GVC Holdings (OTCPK:GMVHF), Playtech (OTC:PYTCF) and The Stars Group (TSG) to account for the risk that superhuman artificial intelligence will disrupt online poker.
    • Analyst Ed Young and team note that computer scientists from Carnegie Mellon University developed an AI system that is "stronger than human professionals" in the most popular version of poker. They note the code has not been released in part because it would have a "serious impact" on the integrity of online poker as it stands. The MS analysts then gives all online poker players something to think about. "The AI blueprint strategy was developed for a cloud-computing cost of just $144 in 8 days, runs on normal computers, plays twice as fast as professional players and could be adapted for any poker variant," they warn.
    • The conclusion is that a reduced overall confidence in online poker could pose a risk to earnings streams in the future.
    • Price targets on London-traded GVC Holdings and PlayTech are reduced by 2% and 4%, respectively, but still factor in plenty of upside. The price target on Stars Group goes to $17 from $18, which also still implies shares will go higher. 888 Holdings (OTCPK:EIHDF) wasn't mentioned by Morgan Stanley, but presumably is in harm's way. The AI threat to online poker is only a very minor factor for other casino-related names such as William Hill (OTCPK:WIMHF), MGM Resorts (NYSE:MGM), Boyd Gaming (NYSE:BYD), Penn National Gaming (NASDAQ:PENN) and Wynn Resorts (NASDAQ:WYNN).

    Walmart's 'unlimited' grocery delivery goes nationwide

    • Walmart (NYSE:WMT) is expanding its new "unlimited" grocery delivery service, which costs users $98 annually (and $12.95 per month) to 1,400 stores this fall.
    • Grocery wars continue….The company already has more than 45K personal shoppers helping it pack grocery orders for customers every day.
    • WMT shares are also up nearly 25% this year.

    Google paying $550M French tax fine (update)

    • Update: Le Figaro reports that Google will have to pay the French tax office €465M in addition to the settlement.
    • Google (GOOG +0.8%)(GOOGL +0.8%agrees to pay €500M to settle France's criminal tax probe.
    • Prosecutors at France’s Parquet National Financier revealed the settlement during a court hearing today.
    • Google's Irish unit was accused of failing declare part of its revenues in France. The unit failed to properly pay the subsidiary in France, lowering the taxes paid in the country.
    • Under the settlement, Google acknowledges underlying facts but isn't pleading guilty.

    ATVI gains bull on 'Warcraft' strength

    • Nomura upgrades Activision Blizzard (NASDAQ:ATVI) from Neutral to Buy and raises the target from $49 to $64.
    • Analyst Andrew Marok cites the "strong, above-expectations engagement" for the recently launched World of Warcraft Classic game.
    • The analyst also praises new Overwatch features and expects Diablo 4 or Overwatch 2 announcements at November's BlizzCon event.
    • ATVI shares are up 3.1% pre-market to $56.60. The company has an Outperform average Sell Side rating.
    • Aurora Cannabis (NYSE:ACB) is down 9.9% postmarket after revenues and margins disappointed in its fiscal Q4 earnings report.
    • Revenues rose 52% sequentially to just under C$99M, but fell C$4.6M short of consensus, while gross margin on cannabis net revenue ($94.6M, up 61% Q/Q) came in at 58%.
    • EBITDA loss of C$11.7M was an improvement from last quarter's loss of C$36.6M.
    • Canadian consumer cannabis revenue rose 52% to C$44.9M; medical cannabis revenue rose 10% to C$29.7M; and whole revenues were C$20.1M.
    • Meanwhile, cash cost to produce fell 20% from last quarter, to C$1.14/gram. Production volume rose 86% sequentially, to 29,034 kgs.
    • "We continue to see strong growth in cannabis revenues in both medical and consumer categories," says CFO Glen Ibbott. "Our cultivation execution continues to drive production costs lower and improve gross margins."
    • "We are working to extend our reach in the U.S. markets," adds CEO Terry Booth. "Our partnership with the UFC is a basis to explore CBD-from-hemp and hemp food products. We are also exploring additional opportunities and leveraging our Strategic Advisor."
    • Conference call to come tomorrow at 9 a.m. ET.
    • Press release

  19. Woops, and down we go again.  How silly!  

    SPWR/Eric – I agree with selling the Jan $7 calls – too bad you didn't do that at $16!  Still, they are now $5.65 and your best possible was $10 and you only paid $1.72 for the spread – so not bad.  The $17s are very likely to go worthless and we like SPWR long-term so I'd take the $5.65 and establish a longer-term spread to cover but I'd go for the 2021 $12 ($3.30)/17 ($1.80) bull call spread at $1.50 so you pocket $4.15 and, if you don't have to roll the short Jan $17s, you can sell 1/2 the March whatever is $1 and pick up 0.50 per long 4 times in 2020 and there's another $2 right there so, if all goes well, you get back $4.15 (now) +$2 (from short call sales) + $5 (from the new spread) and that's $11.15 – more than your original $10 spread.  IF SPWR goes lower THEN you can sell puts (the 2021 $10 puts are already $2.30, $7 puts are $1.05) to pay for a roll to a lower strike but why lay it out in advance if you don't need to?


  20. Atitlan / dual passports

    You will need 500K in Spain, buying a real estate or other "hard assets", 250K in Portugal and Greece (same condition) 


  21. Ahh … and you need to bring the money, no 30years mortgage for this.


  22. Advill not only the cash you quoted to obtain a pass port you need to reside more than 180 days per year in both countries and you need to speak the language to obtain citizen ship. Not that easy.you only than optain a pass after 5 years. Obviously as European you can move to any of these countries just have to show a certain income per month. .


  23. Thanks everyone for the overseas advice. Looking at Italy, Portugal, and Malta. Currently in a 5-6 year plan to position myself like one of those trap door spiders that Phil talks about – motionless for now but ready to strike when/if conditions are right.

    I've had some dental work done overseas as well as a visit to the ER, and after seeing those tiny bills (even as a non-EU citizen) it seems irresponsible not to consider becoming an EU resident. Especially if I want to leave something to my kids.


  24. Morning Phil – I was able to catch part of the webinar yesterday and saw you mention Stockpedia.com. Can you tell me a little more about how you like it? Thank you. 


  25. Phil

    What are your thoughts   T ?

    Should were roll or wait  ?

    Thanks


  26. As a European/Yodi – Only until the EU breaks up!  cheeky

    Stockopedia/Willsons – Well I just like the way the financial charts give a 5-year view + 2 year's forward projections.  I don't even use it for anything else but they have tons of other feature – ranking, screening, etc.  It's also great as you can subscribe to multiple countries, so very good for EU traders.  

    Up we go again – I don't know what anyone was worried about…

    T/QC – Well, we have it in the OOP but just the 2021 $28/35 bull call spread with short $30 puts so I guess you mean the LTP buy/write position:

    T AT&T Corp. 2000 5/3/2019 132 $61,200 $30.60 $7.58 $29.59     $38.18 $-0.56 $15,160 24.8% $76,360
    T Short Call 2021 15-JAN 30.00 CALL [T @ $38.18 $-0.56] -20 5/3/2019 (491) $-5,800 $2.90 $5.48     $8.38 $-0.40 $-10,950 -188.8% $-16,750
    T Short Put 2021 15-JAN 30.00 PUT [T @ $38.18 $-0.56] -20 5/3/2019 (491) $-7,500 $3.75 $-2.37     $1.38 $0.05 $4,740 63.2% $-2,760

    There's really nothing to do – if we get called away then we do but $38 makes it silly to try to adjust.  We paid net $23.95 so called away at $30 is +$6.05 (25%) + $1 in dividends so far (4%) and another 2% for eeach Q going forward.  Anything we try to do to keep it would be speculative at this level and not only wasn't that the intention but, since we're inclined to cash things out – let this be one of them if it goes.

    The current net is $56,850 out of a potential $60,000 and all these dividend plays are just ways to put our cash to work – it's not supposed to be gambling money.  Of the $3,150 we could possibly make by waiting until 2021, $2,760 of it is the short puts so really, there's not much point to the covered stock outside of collecting, in theory, another $2.50 in dividends but that's still a respectable 10% of our cash at work – so no reason to do anything.  


  27. AAPL/Phil- have 5 Sep 205 short calls sold for 8 with 180-225 Jan 21 bcs. This was from one of the official trades. Not sure if you already adjust this short call and i missed it. Thanks


  28. Europe / Phil – If anyone is interested in getting a European passport, I am ready to start an adoption process smiley. My fee is $100K per person which sounds reasonable.


  29. AAPL/Ravi – We've moved AAPL so many times I couldn't even tell you.  Realistically, the trade is on track to make your full pay-out so shouldn't be a priority for you.   The short $205s are in the money and you simply have to roll them, if you haven't sold any puts, I'd roll the 5 short Sept $205 calls at $20.30 to 5 short Jan $225 calls at $13.50 and 5 short Jan $205 puts at $5.70 so spending net $1.20 to roll the short calls up $20 in strike.

    Adoption/StJ – Used to be you could buy a castle with at least a Barony for that price…  I was considering it in my 20s at one point but it turned out the upkeep of a castle is killer!  

    • The 10-year Treasury yield whooshed lower earlier today after the ECB announced a rate cut and new wave of QE. That's reversed in a big way, with the yield now higher by 5.5 basis points on the session to 1.79%. TLT -0.7%TBT +1.4%
    • That means the 10-year yield has climbed a whopping 35 basis points in the handful of sessions since Labor Day – if there's been a sharper move higher in recent (or distant) memory, we can't think of it.
    • Today's move has brought the 30-year yield up to 2.26%, meaning the Fed Funds rate at 2.25% in no longer the largest number across the yield curve.
    • Not complaining are the banks – the SPDR S&P Bank ETF (NYSEARCA:KBE) is up about 8% since returning from Labor Day weekend.

    TCNNF has no options but it's the biggest medical marijuana company in Florida and well-positioned to expand.  $9.15 is $1Bn in market cap and, amazingly, they actually make money:

    Keep in mind this is medical ONLY and those are the numbers.  They already have 29 stores around Florida and if Florida goes recreational in 2020, all they have to do is wait for the customers to line up.  Florida's patient count is just 238,000 out of 21M so 1% are registered for medical so legalization can go more than 10x (13% of people in CA smoke) and then there's the tourist trade!  

    This came up because we're (New Age/PSWI) doing a competitive analysis for our own operation in Florida and we think we might be better off working with Trulieve (just having them carry our stuff in their stores) than going against them.


  30. Actually CA is on the low end, surprisingly.  Alaska has the highest percentage of pot-smokers (of legal states) at 16%, tied with Vermont and followed by Colorado & New Hampshire (15%) but Mass (14.5%) is only starting this year and coming up fast so I think they may take the crown next year.  Maine is 13.5% – that's kind of funny as I never met anyone in Maine I would have thought was smoking pot (outside the slopes, of course).  


  31. By the way, notice that gross profit as a percent of revenue – that's why I love this business!   There are tons of opportunities like this for our Cannabis Fund to invest in but even Trulieve is late-stage for us – as they already IPO'd but still a bargain in the realm of public MJ companies. 


  32. AVGO earnings today after bell — the stock had a big run up to it…




  33. When Your Commander in Chief Is Also Providing Your Hotel Room



  34. Ford -4% after junk rating rattles investors

    Ford (NYSE:F) says its underlying business is strong and the balance sheet solid in reaction to its bonds being cut to junk status by Moody's. "We have plenty of liquidity to invest in our compelling strategy for the future," reads a statement from the automaker.

    CreditSights weights in on the Moody's cut on Ford. "Even if both S&P and Fitch downgrade a notch to low BBB, Ford will still remain in the IG index," notes the research firm in referring to the high-grade index. The danger for Ford is that a fall out of the IG Index and junk status ratings from agencies mean fewer pension funds and other institutional investment funds would be able to buy Ford bonds in the future.

    Phil / Ford ( F) – any thoughts on having their credit rating dropped top Junk by 


  35. Wilson's Stockopedia – I started using this this year.    It's a great site, not only does it have good data that is updated, it also has a great stock compare feature that lets you compare any stocks based on certain criteria.   They are also open to adding features when you ask.    I got a free trial, and at the end of the year I got 2 years for the pice of a 1/2 year membership….  


  36. Phil:  Do you have any comments on, Ocean Power Technologies, OPTT?  Thank you.


  37. Phil, this is from an analyst friend of Whitney Tilson.  The NASDAQ symbol is CRLBF.  No options .

    Also has been touted by Motley Fool.    Do you know of them ?

    Charlotte's Web (TSX: CWEB): It's the leader in CBD products, with a five-year lead on everyone else. It has strong brand recognition and great intellectual property on its seeds and strains. And it has far less regulatory uncertainty than most other companies. I think this is a "must own" in the sector.


  38. OOPS !  Wrong symbol.

    Should be CWBHF.


  39. AAPL/Phil- Thanks


  40. F/Batman – We bought F for $9.15 and sold $7 calls and $10 puts for $4.50 so our net is $4.65 or $7.33 if assigned at $10 so that's our target and none of this is a surprise.  F is being junked over pension obligations – not debt – so it's a long-term problem, but that didn't help GE.

    OPTT/John – I like them and I like their solution and I worked with them way back in the 80s at some point but holy crap have they gone nowhere in 30 years!   It's kind of like LQMT – very impressive stuff but they just can't commercialize their products.    

    So, in short, they have 14 proposals on the table and they are talking to 66 more people who took their cards at trade shows.  They couldn't get people to bite on buying the systems so now they are doing them as leases.  They have enough cash ($17M) to cover the burn ($12M) for the next year.  

    Their big problem is that, 30 years later, solar has come down to 1/100th the cost and they are not really competitive with solar or wind – so now it's more of a specialty solution for certain situations.  The cost of solar energy these days is just 0.07 per kWh and OPTT has a 150 kWH solution that would cost roughly $345,000 to deploy as solar but has a 20-year lifespan so, unless you CAN'T use solar for some reason – there's not much point to OPTT anymore. 

    CWBHF/Albo – Isn't that a kid rock song?  I don't know them, I know Trulieve because we were at a show together a while ago and chatted on and off for a few days.    CWBHF is in Colorado on the CBD side of the business and I have no idea what a 5-year lead is and I don't even know what seeds and strains have to do with CBD – it's like saying your vitamin C is better because you get it from Jaffa oranges – no one actually cares.  

    I do like the $69M in sales and $12M in profits from a Hemp Boca perspective but not enough to give them $1Bn – though I'll take that valuation for our company! 

    You're welcome Ravi.


  41. This was interesting:


  42. CWBHF -  Thanks, Phil.


  43. By the way, at Kevin Harrington's thing Tuesday, someone was there doing an educational breakdown of CBD and people don't realize it's a natural substance your own body produces and people do not, in fact, get enough of it in their diets. 

    Image result for endocannabinoid system

    Image result for endocannabinoid system

    Two primary endocannabinoid receptors have been identified: CB1, first cloned in 1990; and CB2, cloned in 1993. CB1 receptors are found predominantly in the brain and nervous system, as well as in peripheral organs and tissues, and are the main molecular target of the endocannabinoid ligand (binding molecule), anandamide, as well as its mimetic phytocannabinoid, THC. One other main endocannabinoid is 2-arachidonoylglycerol (2-AG) which is active at both cannabinoid receptors, along with its own mimetic phytocannabinoid, CBD. 2-AG and CBD are involved in the regulation of appetite, immune system functions and pain management.[6][7][8]

     Emerging data in the field also points to FAAH being expressed in postsynaptic neurons complementary to presynaptic neurons expressing cannabinoid receptors, supporting the conclusion that it is major contributor to the clearance and inactivation of anandamide and 2-AG after endocannabinoid reuptake.[21] A neuropharmacological study demonstrated that an inhibitor of FAAH (URB597) selectively increases anandamide levels in the brain of rodents and primates. Such approaches could lead to the development of new drugs with analgesic, anxiolytic-like and antidepressant-like effects, which are not accompanied by overt signs of abuse liability.[32]

    The endocannabinoid system has been shown to have a homeostatic role by controlling several metabolic functions, such as energy storage and nutrient transport. It acts on peripheral tissues such as adipocyteshepatocytes, the gastrointestinal tract, the skeletal muscles and the endocrine pancreas. It has also been implied in modulating insulin sensitivity. Through all of this, the endocannabinoid system may play a role in clinical conditions, such as obesitydiabetes, and atherosclerosis, which may also give it a cardiovascular role.[53]

    This is why people taking CBD claim to get so many kinds of benefits – it really does do a lot of things in your body.  Lots of plants have cannabinoids, just in much lower doses.   

    CBD is an entirely different compound from THC, and its effects are very complex. It is not psychoactive, meaning it does not produce a "high" or change a person's state of mind, but it influences the body to use its own endocannabinoids more effectively.

    According to one study posted to Neurotherapeutics, this is because CBD itself does very little to the ECS. Instead, it activates or inhibits other compounds in the endocannabinoid system.

    For example, CBD stops the body from absorbing anandamide, a compound associated with regulating pain. So, increased levels of anandamide in the bloodstream may reduce the amount of pain a person feels.

    Cannabidiol may also limit inflammation in the brain and nervous system, which may benefit people experiencing pain, insomnia, and certain immune-system responses.


  44. I can't believe that Woodstock concert was 20 years ago already.  

    My friend and I flew to Rome, NY (his plane) and walked to the show.  Last major festival I ever went to (had Maddie the next year).  We're left of the stage in that video – safely behind the ropes! 


  45. Phil / Video =  We go to Music festivals ( more subdued than that one) every years w/ our boys….. get VIP seating and it's a great time….   

    Could not find you in the video – what were you wearing?


  46. 9/12/19   AVGO – Earnings call Key points for me –  FY Q3 '19 

    SW Business remains strong and don't see slow down here.  However hardware associated w/ the SW ( CA type) business is weak and tentative.

    Semi Business weak and still negative in terms of growth into Q4.  Thinks they have seen bottom here but a lot of tentativeness and squeezing of supply chains with order take downs.   They also don't see improvements or a turn around in FY Q1 and it may be an issue w/ outlook next year.  They specifically were asked if they had seen pull ins to take advantage of the delay in tariffs and they did not answer the question.  The issue here is Apple is ramping now in China, so pulling are tough if you haven't achieve a high ramp rate.  

    Comms / RF ( Mobile Phones) – even though there are ramps going on ( Apple) they see a slower growth quarter vs. last year and don't seem optimistic on Q4 either.  this will be down question is how much.  

    Storage / Storage Cloud (HW) – not as strong and did not mention any stability here or bottom.

     My personal thoughts – Semi in general can only build and hold for so long,  at some point wafer starts will slow down – especially in the memory and the higher complexity ICs – even if there is a break through I'm not sure demand can turn on quickly enough to impact Q1 or Q2 of next year.  Also Memory chip suppliers that have take off recently may be exposed to the downside.  

     

    I’ve been listening to the CEO for many quarters….. this is the most subdued I’ve heard him….  He probably has a relatively good view of what is going on in China.






  47. Uber pulls its Jump bikes from two cities



  48. Aurora Cannabis’ next big play: The US CBD market










  49. "I can't believe that Woodstock concert was 20 years ago already."

    Phil, you meant to say 40 years ago.


  50. Good morning!  

    40 years/Albo – No, just 20 – it was Woodstock 1999, the other was 50 years ago and I was 6 and my parents weren't hippies, so I missed it.  

    Wearing/Batman – I think it was jeans and a tee shirt.  I can't see myself there either, I was left of the speakers in a VIP section, the place was a madhouse so we left the same day we came – we had planned to stay overnight but it didn't feel safe – like Times Square on New Year's – it's a fun party but, if you get stabbed you kind of realize it was your own fault for risking it…

    And speaking of China – everyone is still optimistic now that there's going to be a trade deal.  Trump may have to fire Lighthizer to get it done though.

    Doesn't matter though, 3,025 this morning is back to all time highs on the S&P.   3,028 was actually the tippy top in late July.  Dow was 27,400 so 100 to go there, Nas 100 was 8,027 and that's 54 points from here and RUT 1,742 is 154 from here so about 10% for the Russell to catch up so that's the bull play if the rally is real (which is why we killed our TZA hedges).


  51. I thought you were way too young to attend the first one !