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Super Tuesday – G7 Fails to Guarantee Free Money

What the Hell were people expecting?

The markets rallied insanely yesterday on expectations of a 50-point rate cut along with coordinated cuts around the World and tax cuts and Santa Clause, etc., etc. – total idiocy.  This morning the futures are turning down already as the G7 "Emergency Meeting" has not actually come up with any actual emergency measures – it's more like one of those "hopes and prayers" messages after a school shooting – good luck guys!  

 Of course the G7 doesn't have the power to do much – only to suggest and, as Trump pointed out, the Australian Central Bank lowered their rates by another 0.5% but keep in mind that Australia was on fire a few weeks ago and NOW they have the virus AND their primary trading partners are China and Japan - that's a little worse off than we are.

Image result for mnuchin g7 cartoonKeep in mind the lunacy that is going on here – we are having emergency G7 meetings led by Steve Mnuchin (a Goldman Sachs Bankster) who is telling the Global Finance Leaders that they must lower rates to prop up the markets BECAUSE THEY ARE 8% below their all-time record highs.  Propping up the markets is very expensive and it adds to government debt and it only helps the Top 1%, who own 90% of the stocks – what is the real agenda here?

Remember that Steve Mnuchin's primary experience after leaving Goldman Sachs in 2002 was overseeing the complete collapse of Sears as a Board Member from 2005 until 2016 when Trump decided he was the perfect guy to supervise the collapse of the United States of America as well…

Going more into debt can't be the answer for every problem – especially when it's "Let's go more into debt by giving more money to rich people."  The money doesn't trickle down – it's been 40 years of this BS and it has NEVER trickled down – it's a ridiculous strategy that used to be called "Voodoo Economics" until the Republicans realized they could win elections and, more importantly, win campaign contributions by making it the cornerstone of their economic platform.

Image result for adelson trump cartoonThat's why Shelly Adelson, who's worth $37Bn, is giving $25M to Trump and $100M to other GOP candidates this year – Trump's tax policies have already saved him Billions of Dollars and will save him Billions more over the next 4 years if Trump is re-elected while Bernie Sanders thinks Wynn (WYNN) Casinos should pay more than the (negative!) -$497M on $1.25 BILLION in Operating income they (un)paid in 2018 and perhaps Shelly should pay more than 12% taxes on his $4.2Bn income.  

It's Super Tuesday today with 14 states holding primaries including Texas and California and it's very possible that Bernie will sweep and essentially lock up the nomination – that will make things interesting for Corporate Profit forecasts as roughly 20% of corporate profits are the results of the Trump Tax Cuts, something Bernie and a Democratic House will quickly put a stop to in 2021.

And well they should as we are $1.2Tn in debt this year and, if Trump does get more stimulus pushed through to boost his re-election chances then Bernie, like Barack will come into the White House in a year that we are already running a $1.5Tn annual deficit.  No wonder Shelly is fighting so hard to keep Trump in office, 3% of that deficit has been going right in Adelson's pockets!

Image result for trump vegasObviously, it would be unfair for a man earning 76,363 times more than the Average American ($55,000) to pay more taxes than the Average American ($17,000) but it would be nice if at least we didn't have to PAY HIM $497M to fund the expansion of his casino in China.  What's more likely to happen under Trump is that we will be bailing out Mr. Adelson as his "vital" casino business is having a rough quarter due to the virus.  After all, who else do we know who owns a casino that might want a bailout?  

We'll be watching those bounce lines this morning and nothing less than taking back the strong bounce lines and holding them (without failing) for 2 days will convince us the sell-off is over.  Until then, we will patiently watch and wait:

  • The S&P, for example, fell from 3,400 to 2,900 so 500 points and a bounce is 20% of the drop so 100 points so 3,000 is a weak bounce and 3,100 is a strong bounce.  
  • The Dow was 29,500 to 25,000 so 4,500 would be 900 but we'll call it 1,000 as it's not an exact science and 100 points on the Dow is 10 seconds these days – and the Dow loves round numbers.  So 26,000 is weak and 27,000 is strong. 
  • Nasdaq fell from 9,600 (because 8,000 is the base so it's the 20% line and that overrules any other spike around it) to 8,400 because we have 400-point lines working so 8,800 is weak and 9,200 is strong.  8,400 is the weak bounce line off 8,000.  
  • Russell 1,600 is the main line and 1,400 is strong support so that's the range but we fell from 1,700 back to 1,450 so 250 means 50-point bounces to 1,500 (weak) and 1,550 (strong) 

While yesterday's recovery was very impressive – it didn't happen because the virus disappeared or the supply chains restarted or all the cancelled conferences are back on.  No, it happened because people think we are getting AT LEAST a 1/2-point rate cut and we can go back to blowing our market bubble – until the virus takes the breath from our lungs, anyway...


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  1. Good Morning!

  2. Reading the struggle that some people are facing when they show signs of the virus in the US to get tested or even to get the proper information doesn't fill me with a lot of confidence in the system. It looks like we are not well prepared if it explodes here!

  3. This I scary – Trump is lying about the issue by withholding testing – view from the people on the ground

    'National Scandal': ER Doctor Slams Trump Administration's Coronavirus Testing Logjam

    From HuffPost, a Flipboard magazine by HuffPost

    “I’m a practitioner on the firing line, and I don’t have the tools to properly care for patients today," warned…

    Read it on Flipboard

    Read it on

  4. Great cartoon, Phil – it looks like the movie "Snow-piercer", made by Bong, who made "Parasite".

  5. The bug – here's an assessment of the China situation. A review of Korea should be forthcoming, and we'll see how it matches up:

  6. The Bug – this graphic is the standard epidemiologic curve, doing the standard thing:

  7.  Fed cuts 50 bps

  8. incredible….

  9. albo - refinance time

  10. i thought my TOS was having a robin hood moment. happy to have been long /ES but it didn't give me the exact exit i would've hoped for.  The nature of volatility i suppose! still a nice trade

  11. BDC -Good point.

    FED rate cut, an obvious short term fade.

  12. Out of 1/3 of my JO today. Good call Phil!

  13. Snow – we're going to be responsible for much of the NPI's in the US ourselves (or at the local government level)

  14. Fed not feeling the pressure from Trump at all! Next question is – why do we need to cut rates in the greatest economy and markets of all time? Asking for a friend who is not well versed in economics.

  15. Good morning!

    Nice 500-point swing to start the day.   Fed with a surprise 50-point cut.  Well, not surprising but surprising after non-committal G7 though already anticipated yesterday.  

    Big Chart, need to see those 200 dmas taken back, 50 on the Nas.  

    If this doesn't work – BIG TROUBLE!  

    Testing/Batman – If you don't test, you don't have any cases – problem solved…

    Thanks Snow:

    5% of people who are diagnosed with Covid require artificial respiration. Another 15% need to breathe in highly concentrated oxygen - and not just for a few days. The duration from the beginning of the disease until recovery is 3 to 6 weeks on average for these severe and critical patients (compared to only 2 weeks for the mildly ill). The mass and duration of the treatments overburdened the existing health care system in Wuhan many times over. The province of Hubei, whose capital is Wuhan, had 65,596 infected persons so far. A total of 40,000 employees were sent to Hubei from other provinces to help fight the epidemic. 45 hospitals in Wuhan are caring for Covid patients, 6 of which are for patients in critical condition and 39 are caring for seriously ill patients and for infected people over the age of 65. Two makeshift hospitals with 2,600 beds were built within a short time. 80% of the infected have mild disease, ten temporary hospitals were set up in gymnasiums and exhibition halls for those.

    That's where the real trouble is – our medical system is not equipped to respond to an expensive crisis.

    An examination of 44,672 infected people in China showed a fatality rate of 3.4%. Fatality is strongly influenced by age, pre-existing conditions, gender, and especially the response of the health care system. All fatality figures reflect the state of affairs in China up to 17 February, and everything could be quite different in the future elsewhere.

    Healthcare system: 20% of infected people in China needed hospital treatment for weeks. China has hospital beds to treat 0.4% of the population at the same time – other developed countries have between 0.1% and 1.3% and most of these beds are already occupied with people who have other diseases. 

    The US has 792,417 hospital beds for 320M people so 0.24% of the population – one of the lowest in the World. 

    Pre-existing conditions: The fatality rate for those infected with pre-existing cardiovascular disease in China was 13.2%. It was 9.2% for those infected with high blood sugar levels (uncontrolled diabetes), 8.4% for high blood pressure, 8% for chronic respiratory diseases and 7.6% for cancer. Infected persons without a relevant previous illness died in 1.4% of cases.

    Since the end of January, the number of new coronavirus diagnoses in China has been steadily declining (shown here as a graph) with now only 329 new diagnoses within the last day – one month ago it was around 3,000 a day. "This decline in COVID-19 cases across China is real," the report says. The authors conclude this from their own experience on site, declining hospital visits in the affected regions, the increasing number of unoccupied hospital beds, and the problems of Chinese scientists to recruit enough newly infected for the clinical studies of the numerous drug trials. Here is the relevant part of the press conference about the decline assessment.

    ne of the important reasons for containing the outbreak is that China is interviewing all infected people nationwide about their contact persons and then tests those. There are 1,800 teams in Wuhan to do this, each with at least 5 people. But the effort outside of Wuhan is also big. In Shenzhen, for example, the infected named 2,842 contact persons, all of whom were found, testing is now completed for 2,240, and 2.8% of those had contracted the virus. In Sichuan province, 25,493 contact persons were named, 25,347 (99%) were found, 23,178 have already been examined and 0.9% of them were infected. In the province of Guangdong, 9,939 contacts were named, all found, 7,765 are already examined and 4.8% of them were infected. That means: If you have direct personal contact with an infected person, the probability of infection is between 1% and 5%.

    "Much of the global community is not yet ready, in mindset and materially, to implement the measures that have been employed to contain COVID-19 in China. These are the only measures that are currently proven to interrupt or minimize transmission chains in humans. Fundamental to these measures is extremely proactive surveillance to immediately detect cases, very rapid diagnosis and immediate case isolation, rigorous tracking and quarantine of close contacts, and an exceptionally high degree of population understanding and acceptance of these measures."

    "COVID-19 is spreading with astonishing speed; COVID-19 outbreaks in any setting have very serious consequences; and there is now strong evidence that non-pharmaceutical interventions can reduce and even interrupt transmission. Concerningly, global and national preparedness planning is often ambivalent about such interventions. However, to reduce COVID-19 illness and death, near-term readiness planning must embrace the large-scale implementation of high-quality, non-pharmaceutical public health measures. These measures must fully incorporate immediate case detection and isolation, rigorous close contact tracing and monitoring/quarantine, and direct population/community engagement."

    Woops, rally over already?

    JO/Ati – Very nice run on those.  

  16. I guess Powell was worried about being the recipient of many mean tweets! 

  17. Stjean/Why  To Keep America Great…. :(

  18. ROFL!

    I had a light like that in my dorm – very trippy!

    Here's your rally:

    So the Fed devalues every cent you own by 0.5% ($500Bn of wealth) to boost the markets.  Smart!

  19. Phil – where do I find those futures trade pages in TOS that I see you watching in the videos?

  20. The Bug "non-pharmaceutical interventions can reduce and even interrupt transmission" – Well, of course. That's why I was so frustrated with all the initial noise about putting huge efforts into drugs and vaccines. Neither will arrive in time, and standard public health measures have already been proven to work in outbreaks.

  21. US Virus updates – yesterday we total cases was at 85 (. I think) today at 105?  This makes no sense – Washington and California were supposed to have their own testing capability in state, but apparently even though if they confirm a case it is not "official' until the federal gov confirms it.   So these numbers look to be low artificially – I'm trying to get the raw numbers int the two states but can't find them.

  22. This was as of 2/28:  In California

    There are currently 33 confirmed cases of COVID-19 in California, the governor and state health officials said today.

    Speaking at a late morning press conference with Gov. Gavin Newsom, Dr. Sonia Angell, director of the California Department of Public Health, broke down the numbers:

    24 cases where people arrived on repatriation flights

    7 that are travel-related

    1 from person-to-person contact from a spouse living in the same home

    1 new case that may be first instance of human-to-human transmission among the general public

  23. I have some CD's and treasuries coming due.  Anybody have some 3 to 9 month covered call ideas.

    I would like to collect one or two dividends and sell an in the money call that has some good downside protection.  I dont mind if I get called away, but not wanting to add sold puts at this time.  

  24. Coronavirus delays PC and smartphone shipments for weeks

  25. Ah, found it.

  26. Chris Matthews retires from MSNBC

  27. Futures/Tangled – I think you mean the ones that are under Trade and then Active Trader but you have to make your own boxes.  

    3-9 months/Stock – I'd wait a week before getting bullish on things.  Fed already proving ineffective (as I predicted), Powell just spoke, didn't make anyone more comfortably.  The fact that the Fed felt compelled to act gives you an idea of what kind if disaster they think we are facing.

  28. I know why the market's going down… it's all the millenial market movers that can't get in on the action because Robinhood is still down! LOL.

  29. Robinhood/Greg – What a disaster that is!   You get what you pay for, I guess. 

  30. Someone already started up a class-action suit yesterday, and today is milking the hell out of this for free advertising for their platform. 

    This can only end badly for Robinhood.

  31. Robinhood – being down is the best thing they could do for their customers. If they can't log in, they can't make any more bad trades.

  32. Also – last Emergency Fed Cuts

    Oct 2008  Lehman 50bp
    Jan 2008 Stock Crash 75bp 
    Aug 2007 – Subprime 50bp 
    Sept 2001 – 9/11 50bp 
    April 2001 – Weak economy 50bp  
    March 2001 Tech bubble 50bp
    Oct 1998 – Russia / LTCM 50bp 

    No good example of the greatest economy ever!


  33. LOL Dawg!

    Good point, StJ.

    Pence/QC – He's a total disaster. 

  34.  IBM    I was thinking of buying IBM at $131 and selling the September $120 calls for $16.5. ??  anybody's thoughts 

    Thats pretty darn conservative 

  35. the Dow only went as low as 26,100 today. This is a sad, pathetic joke. Investors are substantially underestimating the damage the quarantine effect has already had on the Q2 through Q4 earnings, let alone could happen going forward. It's hard to imagine being long Dow over 15,000, and maybe lower. 10,500 would be 50% higher than it's last low in 3/2009.

  36. CNBC now saying "this is just the beginning" of Central Banksters fixing the economy.  They are nuts, they think stimulus fixes everything though it's been proven, time and again, that it doesn't.  As StJ notes above, Aug 2007 – did not help, Jan 2008 – did not help, Oct 2008 – did not help…  To some extent, the Fed panicking makes people panic.  

    IBM/Stock – If an 0.50 rate cut isn't giving us a green day, do you really want to bet IBM isn't going to drop 10% in 7 months?  I think it's fine if you REALLY want to own IBM in the portfolio but if you think this is some "safe" way to park your money – that's just not at all true.

    Europe and Japan failed at weak bounces, we are the only idiots who rallied like that off the lows:

    VIX hit less than 20% correction after 100% run up (weak retrace) – not at all out of the woods here:

    10,500/BDC – That's a bit low as don't forget they added AAPL $295  (replaced T $37), CSCO $41 (C $66), TRV $127 (GM $31), UNH $268 (KHC $26), GS $206 (AA $13), NKE $93 (BAC $28), V $190 (HPQ $20) and WBA $47 (GE $11).

    So that's net 1,035 Dow Dollars added through substitution at 8.5 points per $1 = 8,797.50 points that have been artificially added to the Dow over the past 10 years so the Dow is already at 17,500 – it just LOOKS like it isn't!

    And who is the one manipulating the Dow Jones Industrial Average to make people think the market is doing a lot better than it really is? 

    Rupert Murdoch has struck a deal to acquire The Wall Street Journal and its parent company, Dow Jones & Co. A majority of members of the Bancroft family elected to sell to Murdoch's News Corp. to seal the $5 billion deal. The family currently holds the controlling shares in Dow Jones.Aug 1, 2007 

    Funny how all these things end up tying together, isn't it?

  37. Stockbern -The IBM trade would net you max 4.2% return for 6 1/2 months, not worth the risk, IMO.

    I would suggest, a short term trade with a possible higher potential. I'd buy M at $12.75.  It goes ex divd on 3/12 for.377.

    I'd sell the the 3/13 13.5 call for $.21.  If stock stays below 13.5 you get the divd and keep the premium,or .$587 on your outlay , or 4.4% in 10 days.  If called away and you miss the divd, you make $.75 or  5.8%.

    M is  yielding an unbelievable 11.80%.  This should help cushion the downside.

    If not called away, write another OTM call a few months out.

    Just a thought.

  38. Speaking of Dow components: NKE just caught a virus downgrade.

    • The Fed's monetary policy committee cut the federal funds rate target range "to help the U.S. economy keep strong," said Federal Reserve Chairman Jerome Powell in a press conference.
    • "The U.S. economy remains strong," he said, but "the spread of the coronvirus has brought new challenges and risks."
    • Powell adds that the virus has disrupted economic activity in many areas of the world and "will surely weigh on economic activity both here and abroad."
    • Adds that the Fed has been in active talks with other central banks around the world "on an ongoing basis."
    • "Risks to U.S. outlook remains a significant one," he said, adding that the central bank will continue to closely monitor developments closely.
    • Halliburton (HAL -5.5%) is downgraded to Neutral from Buy with a $17.50 price target, slashed from $31, at UBS, as analyst Amy Wong says the company's portfolio exposes it to greater revenue and margin pressure relative to peers because of the coronavirus, and that key end markets are facing overcapacity.
    • But after the recent drop in Halliburton shares, Wong says the stock's valuation of 6x enterprise value to expected 2021 EBITDA now represents a "slight discount" vs. its normalized multiple of 6.5x.
    • Separately, Halliburton – which operates in 80 countries – says it has restricted all global non-critical business travel due to concerns about the coronavirus.
    • HAL's average Sell Side Rating is Bullish, but both its Seeking Alpha Authors' Rating and Quant Rating are Neutral.
    • Abbott (ABT -1.5%), French biotech bioMérieux (OTCPK:BMXMF +3%) and Co-Diagnostics (CODX -7.7%), along with public health labs and hospitals, are working feverishly (no pun intended) to develop tests to spot coronavirus-related illness.
    • At present the only available FDA-approved tests are from the CDC and state of New York and this has not been problem-free. Some of the CDC's molecular tests that it shipped to other labs didn't work properly and had to be replaced. Also, all presumptive positives require confirmation at the CDC lab in Atlanta.
    • The FDA has communicated with more than 70 developers and public health labs about their respective tests. The New York State Department of Health is testing samples and is providing instructions to hospitals to replicate the test on-site with a goal of processing about 1,000 tests each day.
    • A test developed at Hackensack Meridian Health, operator of 17 hospitals in northern New Jersey, can generate presumptive results in ~two hours, allowing the start of supportive care while the sample is confirmed at a state lab.
    • BioMérieux is developing two tests, one that generates a result within an hour that can be used outside of a lab and the other for high-volume in-lab processing. Both may be available in the next several weeks although regulatory sign-off could add to the timeline.
    • Related diagnostic test makers: Thermo Fisher Scientific (TMO +2.8%), Roche (OTCQX:RHHBY +2%), Qiagen (QGEN +14.3%)
    • Jefferies analyst David Katz warns that the withdrawal of guidance by Hyatt Hotels (H -3.3%) is likely to be followed by similar actions within the sector.
    • Hyatt pointed to decreased transient bookings and increased group cancellations in North America and Europe in pulling the full-year outlook, notes Katz. Presumably, the same issue would apply to other hotel chains.
    • Katz and team expect Hyatt's EBITDA to fall 21.5% in Q1 to $147M vs. a prior estimate for a 2.8% drop and the consensus mark of $178M.
    • "Ultimately, our Hold rating on H is predicated on the mixed model and valuations, which are now incrementally more challenged," updates the firm on the path ahead.
    • Sector watch: Red Lion Hotels (RLH -5.7%), Marriott International (MAR -2%), Hilton Worldwide (HLT -2.2%), Extended Stay America (STAY -3.1%), Wyndham Destinations (WYND -2.2%), Wyndham Hotels & Resorts (WH -2.4%), Choice Hotels (CHH -0.9%), InterContinental (IHG -1.1%), (TRIP -3%), Expedia (EXPE -0.2%) and Park Hotels & Resorts (PK +0.1%).
    • Hotel and travel stocks are underperforming broad market averages after Hyatt Hotels (H -3.4%) pulled its 2020 guidance and the coronavirus headlines continue to worry with a report that a New York City high school is closed due to a suspected coronavirus case.
    • Hyatt's guidance pull wasn't a surprise considering hotel execs in general have been saying that the coronavirus impact is nearly impossible to model.
    • The general feeling from analysts is that the coronavirus news will get worse before it gets better, which could keep travel bookings down.
    • Notable decliners include Red Lion Hotels (RH -1.6%), Hilton Worldwide (HLT -3.1%), Hyatt Hotels (H -3.4%), Wyndham Hotels (WH -2.4%), Marriott International (MAR -2.5%), Full House Resorts (FLL -3.6%), Norwegian Cruise Line Holdings (NCLH -3.8%), Carnival (CCL -3.8%), Royal Caribbean (RCL -2.5%), Booking (BKNG -1.5%), Expedia (EXPE -0.7%), Six Flags Entertainment (SIX -2.1%) and MGM Resorts (MGM -4.8%)

    • Disney (DIS -1.6%) has set a multi-year deal to make its Disney Plus service available in the UK and Ireland, on Sky Q (CMCSA -0.5%).
    • That means a dedicated Disney Plus app for Sky Q boxes, similar to that of Netflix. And the availability will be followed by NOW TV in coming months.
    • It's set to debut March 24.
    • Meanwhile, Wells Fargo has cut its Disney target on concerns that the coronavirus will offer a headwind to the Parks business. Disney's "more exposed to coronavirus than anything else we cover" because of that business, the firm writes.
    • It expects Hong Kong and Shanghai parks will be closed for "considerably longer" than previous guidance for closures through the second quarter, and thinks global box office could also take a hit.
    • And while the stock should underperform through the virus volatility, once that fades Disney should "significantly" outperform the market.
    • It's cut its price target to $155 from $180, now implying a still-healthy 31% upside.
    • Crude oil prices pare earlier advances as OPEC's joint technical committee reportedly recommends the group cut crude production by 600K bbl/day in Q2 and extending existing cuts to the end of the year.
    • April WTI +0.5% to $47.01/bbl after dropping to as low as $46.90; May Brent +0.1% to $51.98/bbl.
    • With the Fed lowering interest rates, bank stocks swoon and homebuilders revive.
    • Financial Select Sector SPDR ETF (NYSEARCA:XLFsinks 2.9%, while the iShares U.S. Home Construction ETF (BATS:ITBadvances 1.1%.
    • Financial names sliding include Bank of America (BAC -4.1%), JPMorgan Chase (JPM -3%), Wells Fargo (WFC -3.1%), and Morgan Stanley (MS -3.1%).
    • Among the biggest moves by individual homebuilders are D.R. Horton (DHI +1.9%), PulteGroup (PHM +1.8%), KB Home (KBH +1.8%), and Lennar (LEN +3.6%).
    • Soon after the Fed cut was announced mortgage insurers rose, but have turned mixed since. Radian Group (RDN +0.8%) rose as much as 2.3%, MGIC Investment (MTG +0.3%) gained 2.1%, and Essent Group (ESNT -0.9%) jumped 2.5%.
    • Do you think Monday's 5% advance might have been in anticipation of today's emergency 50-basis point rate cut?
    • Investors are selling the news hard this morning, sending the Dow (NYSEARCA:DIA), S&P 500 (NYSEARCA:SPY), and Nasdaq (NASDAQ:QQQ) all down close to 2%. Action is super-volatile, and for all we know the averages could turn green by the time we hit the send button on this post.
    • The 10-year Treasury yield, meanwhile, has plunged back to its record low – now off 13.6 basis points on the session to 1.03%.
    • Gold is adding to gains, now up 2.6% to $1,636 per ounce.
    • Wedbush Securities analyst Jen Redding says the underwhelming guidance issued by Kohl's (KSS -1.5%) took the sparkle off the retailer's Q4 EPS beat.
    • Redding lowers the Q1 EPS estimate on Kohl's to $0.40 vs. $0.42 prior view and $0.45 consensus and sees FY2020 EPS of $4.41 vs. $4.53 prior and $4.76 consensus. "Guidance does not factor in potential impact related to COVID-19, despite a roughly (10%) decline in operating margin for the fiscal year under current guidance," she notes

  39. Oh, that's right, this is terrible for Uber and Lyft – people don't want to get in a car with a person they don't know that 100 other people were sitting in!  

    Same goes for movie seats:

    Swipe left on MTCH too!


    Great book!

  40. The Bug – Yeah, the YMCA has been empty for a week or so. No wait time on the weight machines!

  41. Why the F is TSLA still up

    doesn't make sense

  42. Phil, Biodiesel, and Albo    Thanks for your comments all of which make a lot of sense.  

    • SoftBank (OTCPK:SFTBF,OTCPK:SFTBY) invested $1B each into Chinese apartment rental firm Ziroom and online real estate portal Beike, according to WSJ sources.
    • The deals closed in November, before the spreading coronavirus outbreak.
    • For Ziroom, SoftBank Vision Fund invested $500M directly and bought $500M in shares from the founders. The deal carried a $6.6B valuation.
    • The Beike bet was part of a broader financing round that brought in another $500M from other sources. SoftBank participated through a new vehicle it hopes will become Vision Fund 2. The round valued Beike at over $14B.
    • Gold and silver prices spike after the Federal Reserve delivered an emergency 50 basis point rate cut in a bid to protect the economy from the effects of the spreading coronavirus.
    • April Comex gold +3% to $1,643/oz; May silver +4.4% to $17.48/oz.
    • Gold ETFs (NYSEARCA:GLD) have climbed to session highs, with top performers including GOLD +4.4%NEM +3.6%KGC +4.7%AUY +7%,  AU +9.4%GFI +7.6%HMY +6.9%EGO +4.1%IAG +6.6%AEM +6%FNV +5.2%WPM +4%AG +4.7%EXK +4.1%PAAS +5.8%.
    • Match Group (MTCH -1.8%) faces some virus impact in the near term, Jefferies says, trimming growth estimates to 14% from a prior 16%.
    • That's due to the prospect that "fewer people will want to go on dates" and reflects a conservative approach to the virus impact, analyst Brent Thill says.
    • Takes on the effect of the virus on Match Group vary; the stock made it into MKM Partners' "stay at home" stock basket along with other Internet and media companies.
    • Aside from the virus, though, Thill has concerns about Match's iOS subscription management issues persisting, and notes a spin-off from IAC/InterActiveCorp (NASDAQ:IAC) means a technical risk, depending on how many IAC shareholders would be immediate sellers.
    • He's cut his price target to $80 from $88, trimming implied upside to a current 20%.
    • Treasury Secretary Steven Mnuchin said the administration isn't currently considering rolling back existing U.S. tariffs on China as a response to the coronavirus outbreak, he said in testimony before the House Ways and Means Committee.

    Image result for trump tariff slush fund

    Legal experts and members of Trump's own administration have serious questions about the Department of Agriculture (USDA) doling out $30 billion to farmers harmed by Trump's ongoing trade war with China, the Washington Post reported Monday.

    Two USDA officials told the Post that they worried the massive bailout program, administered through the Commodity Credit Corporation, goes far beyond the legal limits intended by the New Deal law.

    "They're essentially using it as a political slush fund to backfill for the cost they're imposing on agriculture through the trade war," Neil Hamilton, former director of the Drake Agricultural Law Center, told the Post. "Congress never said, 'Go spend $28 billion trying to make people whole because of this trade war you created.' That's just something they have cooked up."

    The nearly $30 billion price tag also has many experts questioning the program. During President Obama's tenure, the largest bailout for farmers was a 2018 program to help cotton farmers, which cost $216 million. Trump's taxpayer-funded farmer bailout program costs more than 100 times that amount.

    TSLA/Coulter – Maybe they are using the Chewbacca Defense?  

    Oh yeah, things are getting better in China:

    • Alibaba's (NYSE:BABA) AliExpress warns customers about potential delivery delays due to the coronavirus outbreak.
    • AliExpress said some shipping and logistics are "experiencing longer waiting times for processing orders."
    • Last month, Alibaba warned that the extended Lunar New Year holiday had caused problems for merchants. The company said businesses relying on physical goods would likely take revenue hits in the current quarter.
    • Alibaba shares are down 0.9% to $209.15.
    • Hewlett Packard Enterprise (HPE -0.6%) is set to cancel or put off "nearly all events" calling for travel through the month of April, amid coronavirus concerns.
    • It will proceed with "Discover More London," albeit with fewer international workers, Bloomberg reports. And "Discover Las Vegas" will also go on.
    • But otherwise, the company is joining several others in calling off travel, which is having a ripple effect on industry events.
    • HPE is set to report its Q1 results after the close today; consensus expectations are for EPS of $0.44 and for a 4.8% drop in revenues, to $7.2B.


    • A high school in New York City decides to close on Tuesday, as a precautionary measure, after a suspected case of Covid-19 in the community.
    • SAR Academy and SAR High School, located in the Bronx neighborhood of Riverdale, said it's following guidelines from the New York City Department of health.
    • The school describes itself as a modern orthodox co-educational Jewish community, according to its website.
    • CNBC also reported Westchester Day School also would be closed due to the potential coronavirus case at SAR.
    • SQM +1.8% pre-market despite reporting Q4 earnings fell 38% Y/Y to $66.9M from $108.6M in the prior-year quarter, and revenues slid 16.5% Y/Y to $472M from $565M a year ago.
    • SQM says Q4 lithium revenues plunged 57.4%, hurt by continued low prices, and the lithium oversupply driving the fall in prices could linger into 2020 and "further impact average prices this year when compared to 2019."
    • But CEO Ricardo Ramos says overall lithium demand rose 14% in 2019, in line with the company's expectations, and SQM believes "the fundamentals behind demand growth in the lithium industry are stronger than ever" as the European electric vehicle market gains momentum.
    • The company warns early 2020 sales in China could be hurt by impact of the coronavirus but there are signs things are starting to return to normal.
    • "Depending on the evolution of the coronavirus outbreak, we may be able to recover some of those sales volumes and reach 55K-60K metric tons in 2020," Ramos says.

  43. Tsla is up because some analyst ie yahoo upgraded the stock. Not a lot of traffic in Sarasota county which is strange for this time of year in Fla.

  44. So much for yesterday's rally – POOF!

  45. Traffic/Pirate – We're still crowded in Delray.  Maybe I should walk around town coughing loudly so I can get a table after 7…  devil

  46. Testing 26,000 again and just over 3,000 on /ES – We'll see how bouncy those are.  

  47. And these idiots on Fox Business, Fox News and CNBC all high-fiving each others yesterday on that record day! No high five today – or maybe some for the rate cut! But again, how is that a sign of a healthy economy!

    Again, if we have some stability, competence and transparency at the helm, things might be different. But it's all chaos, lies, incompetence and obsession with the markets. And golf… What we need now is luck. Trump has been lucky so far – inherited a good situation, no major disaster – but the winds might be turning.

  48. Phil, UA/UAA Under Armour what do you think….their bonds have traded much lower, Dec 2018 was the low and far from that level today, not to imply they wont lose value, but holding up considering.

  49. -1600 on the /ES tick. We're about halfway to the first circuit breaker kicking in. I've never seen it before but this looks like it could be the day.

  50. Looks like the 30 year treasury is at a fresh low.  Soon we wont have much left to cut, negative interest rates anyone?

     it could be like this:  oh man I'm all out of cash

  51. LOL stockbern, if Kylo Ren is all outta cash then I'm screwed! 

  52. Fed rate cut is basically pushing on a string now – the actual rates have been going down anyway:

    In fact, the primary purpose of lowering short-term interest rates—which the Fed controls—is to nudge down long-term rates—which the Fed doesn’t control. But as it turns out, that’s already happened:

    Over the past year long-term rates have gone down about 1.5 points. In just the last month they’ve gone down half a point. They are currently at levels below anything Barack Obama enjoyed. I doubt that Trump knows this, but he’s already gotten the benefit of a huge reduction in the interest rates that really matter. He should quit griping.

  53. This is the worst-case scenario – the Fed gave them exactly what they wanted and now people realize it's not going to fix anything.  

    10-year notes below 1%.  Soon the banks will be charging you to hold your money.  No wonder those mattress companies are doing well.

    M/Albo – Not sure how many people will want to be going to malls in Q2.

    UAA/Kustomz – I'm not a bond person but still a retailer and they might be in a spot of trouble going forward.  At $12 you can sell 2022 $10 puts for $1.75 to net $8.25 so why play with bonds when you can just sell some puts?  If you want to make 3% on $100,000 – just sell 20 puts for $3,500 and your worst case is owning 2,000 shares for $16,500 but, if not, you get 3.5% interest on your $100,000 (over 2 years).  Better than a 10-year!

    The day/Ati – No, I think we're going to have a save at 3,000 on /ES.  The powers that be can't afford to let this be a total disaster.

    Pushing a string/StJ – Good analogy.  That's why I said they only have one more effective move left and they shouldn't squander it on this but too late now…

  54. Can play COST short term for a bounce.

  55. Phil, I always check a questionable companies bond to see where they are trading before I venture into the stock. UA has had a lot of issues but the new CEO is a turnaround guy. I was asking about the stock and pointing out the bonds arent trading as though they are going BK.

  56. Oops, TSLA back to $728.  So silly…

    We need another rate cut!  It's been 4 hours man – give us a fix!!!

    Image result for rate cut junkie cartoon

    Image result for federal reserve addiction cartoon

    UA/Kustomz – Oh, they are not going BK, just getting sucked down with retail.  HBI too:

    Not my precious – they just picked up a bucket of cash! 

  57. market might run up!!!


    Lyft shares seeing quick pop higher in recent trade; move attributed to comments at conference where company said that it is not seen a demand reduction because of COVID-19.


    Maybe not yet, but they will.

  59. Still a little short on the day from that rip during the fed. I am probably the sucker here but that selloff earlier seemed like it was growing bigger teeth than anything last week. 

    Bonds acting crazy too.

  60. Phil

    Did adjust WYNN ?


  61. LYFT/Albo – All you need is for a cluster of cases to be traced to an Uber or Lyft driver and it's game over for their stocks – limit down on news like that.  Since we're spinning the wheel 20M times a day – I think I'll just stay away from that casino.

    WYNN/QC – We don't have WYNN do we?

  62. Wonder if there's an easy way to sanitize packages from AMZN.

    Would Lysol wprk ?

    If there is any easy way, very bullish for AMZN.

  63. Not sure that Uber and LYft will suffer significantly as people will opt for a smaller exposure than say a bus. They still need to get from point A to point B. Besides a driver that is ill would not be driving in the first place. Besides the drivers have to keep a very clean car and I hear Lysol sprays are antiviral. 

    • Wedbush analyst Daniel Ives remains bullish on Apple (NASDAQ:AAPL) ahead of the potential 5G iPhone super cycle.
    • Ives: "This remains a major hand holding time for investors in Apple and clearly there will be some speed bumps along the way as Cupertino navigates the coronavirus outbreak. However, we continue to focus on the golden installed base, pent up iPhone upgrade demand activity, and 5G super cycle on the horizon as core components of our bull thesis, along with the $50 billion+ annual services business."
    • The analyst estimates that 350M of the 925M iPhone install base is waiting for an upgrade opportunity. Of those upgrades, Ives expects Apple to ship 215-220M iPhones in FY21 with a potential upside of 231M, which would be a record.
    • Ives maintains his base case scenario that Apple's supply chain in China will be in operation by late April or early May.
    • Wedbush maintains its Outperform rating and $400 target. Apple has a Bullish average Sell Side rating.
    • Source: Apple Insider.
    • Apple shares are up 0.9% pre-market to $301.57.
    • Chipotle (NYSE:CMG) lands on a list compiled by Cowen of the best ESG stocks for investors to consider.
    • "We believe Chipotle strikes the right balance with ESG-related investments, as they have typically also served to bolster unit economics and shareholder returns. Over the past few years, we highlight investments behind items such as energy efficiency, waste reduction, and distribution optimization, which drove tangible ESG benefits and supported restaurant-level margins," writes analyst Andrew Charles.
    • Charles notes the restaurant company installed energy management systems across the entire store base from 2016-19, while in a similar vein reduced average waste per restaurant by over 30% from 2016 to 2019.
    • CMG is rated at Outperform by Cowen.
    • Shares of Chipotle are up 0.81% premarket to $775.00.
    • Within the next three months, Honeywell (NYSE:HON) will bring to market the world's most powerful quantum computer in terms of quantum volume, a measure of quantum capability that goes beyond the number of qubits.
    • When released, Honeywell's quantum computer will have a quantum volume of at least 64, twice that of the next alternative in the industry.
    • The company also announced it has made strategic investments in two leading quantum computing software providers and will work together to develop quantum computing algorithms with JPMorgan Chase (NYSE:JPM).
    • "Our number of platform users may decline materially or fluctuate as a result of many factors, including… a pandemic or an outbreak of disease or similar public health concern, such as the recent coronavirus outbreak, or fear of such an event," Uber (NYSE:UBER) wrote in an 8-K filing.
    • The company also said that an epidemic could disrupt its supply chain for "new mobility" offerings like dockless and electric bikes and scooters.
    • In an interview last month, CEO Dara Khosrowshahi had said, "we're not seeing a significant effect on the business overall."

  64. Wow, should have bet on that bounce off 3,000!  

  65. The 5 minute candles on the /ES are amazing 20 point swings…..

  66. There's 30 points….

  67. So ridiculous, can't play intraday the way this is swinging.

  68. Switching to 1 minute chart!

  69. Third chance for the bounce off of 3k… 

  70. $500 per minute…with a single contract!  :)

  71. ….unfortunately, that's not me….  :)

  72. Google halts all international travel for employees.  Companies don't take these things lightly, it messes up all sorts of things so we should take it seriously when a company that has the best information on Earth decides to effectively write off Q2.  There's no way things are under control!

  73. lol! "minuet" is not a typo, then, StJean?

  74. I'm telling you though, a virus that kills about 2% of the old people on Earth every year – it's going to fix a lot of demographic problems for a lot of countries…

  75. LOL, thats most of Trump's base.

  76. Warren Buffett fails to take his own advice and ups his stake in DAL to 11%.

    Image result for buffett airline quote

  77. The Bug/Phil – well, there will likely be a vaccine in a year or so, and in a decade or so the elderly will be people who had mild cases and are therefore probably immune. So, no annual elderly die-off – at least not from COVID-19.

  78. Big volume day again:

    Date Open High Low Close* Adj Close** Volume
    Mar 03, 2020 309.50 313.82 297.57 300.32 300.32 280,508,077
    Mar 02, 2020 298.21 309.16 294.46 309.09 309.09 237,943,500
    Feb 28, 2020 288.70 297.89 285.54 296.26 296.26 385,764,000
    Feb 27, 2020 305.46 311.56 297.51 297.51 297.51 284,353,500
    Feb 26, 2020 314.18 318.11 310.70 311.50 311.50 194,773,800
    Feb 25, 2020 323.94 324.61 311.69 312.65 312.65 218,913,200
    Feb 24, 2020 323.14 333.56 321.24 322.42 322.42 161,088,400
    Feb 21, 2020 335.47 335.81 332.58 333.48 333.48 113,788,200
    Feb 20, 2020 337.74 338.64 333.68 336.95 336.95 74,163,400
    Feb 19, 2020 337.79 339.08 337.48 338.34 338.34 48,814,700
    Feb 18, 2020 336.51 337.67 335.21 336.73 336.73 57,226,200
    Feb 14, 2020 337.51 337.73 336.20 337.60 337.60 64,582,200
    Feb 13, 2020 335.86 338.12 335.56 337.06 337.06 54,501,900

  79. Nice 53-point drop from high to low so bounces should be 10 points for 295 (weak) and 305 (strong)

    Bug/Snow – Well that means "THEY" will have to work on COVID-20, 21, etc…

  80. No need to fix social security and Medicare then Phil!

  81. If we didn't already run a $1T deficit, I would say, maybe we can fiscally stimulate our way through this, but we are already so stretched. And not just the US.. Although in our case, just plain stupid moves. I can already see getting a Democrat elected to clean up the next GOP mess! And then getting blamed for the actions needed to fix the mess. 

  82. However we'll break the country on healthcare spending saving the other 98% of the useless old people so there's that to think about too. Bernie's $60 trillion of idiocy over the next ten years will end up being $100 trillion. And there aren't enough 1%ers to pay that bill so the middle class is going to get put in the poorhouse. 

    Just like when they passed the 16th amendment by telling everyone that only the rich people are going to have to pay and it's high time they paid their fair share. Well they never did and they still aren't. It's the middle class that gets fucked every time and this time will NOT be different.

  83. Box Office – hmm. What about a super hero action flick fighting people crazed by Corona virus, and destroying the villain's lair where the virus was produced?

    And if it's been done already, so much the better. Hollywood loves reruns.

  84. All (now) 9 COVID-19 US deaths are in my county. Are we winning yet?

  85. Only 1 new case in China today. Nothing to see here folks. Let's plant some rice!

    When Italy hits about 4000 cases that will be the same as China as a % of total population. If you believe China's numbers. 

  86. Anybody have a good indication why, despite the huge drop in the t-bill, there's still not a whole lot of movement on mortgage interest rates?  I'm still seeing my option from 2 weeks ago as the best deal around despite a nearly 0.5% drop in the t-bill over that time.

  87. Phil / PFE – been waiting on this one for a bit – at 34 ish with a 4.3% div.  it's getting a bit interesting.  I know they are I the middle of a transition with the spinoff of the generic unit, ( although they will still own 57%) of the combined co along w/ Mylan.  In addition it will be a choppy year w/ election in this space in general.   They have significant cost savings in process which make a marked impact in '22 and this should help margins and EPS.  I'm wondering at what point you think it makes sense to get in – If the really 31 / 32 I think it makes sense to maybe buy stock and sell some puts/ calls around the position.  What are your thoughts on this?n. thanks,

  88. Phil . PFE –  they are sitting at a 12 EPS which is historically low.  are usually in the 15 to 20 EPS range.  I'm projecting a EPS as flow for '20 – '22

    2.7 / 3.3 / 3.6 with a multiple 12 to 15 gets you to a 34 to 45 / sh price  

  89. JPH/Mtge Rates – Call around. You should be able to land low 3s for a 30 year fixed rate. Specific to your question mortgage rates are correlated to the 10 year but don't track perfectly. There is basis risk associated with mortgage bond pricing. Mortgages trade in MBS or Mortgage Backed Security pools. MBS is about a $6 trillion market. In addition to credit risk the MBS investor takes on prepay risk (you can refi at any time w/out penalty) and for that reason in a large rate rally, mortgage bonds can lag Treasuries as the investors aren't quick to pay more for bonds with loans that are "in the money" to refinance.  Also,when rates get really low lenders can reach operational capacity so they are able to take margins up versus lowering rates.  Hope that helps

  90. thanks musicman.  I have been calling around but seeing figures that don't make much sense.  My best quote right now is 3.25% on a 30 year with $1600 in fees and $2900 in lender credits but that was a quote I got two weeks ago with the tbill around 1.5%.  I think it's a great price but I'm shocked to not see better rates after a half point move in the tbill.

  91. I used to work in the mortgage industry and when we were already crazy busy with refi demand, we did not always drop our rates when the MBS market rates fell.  Just bumped up our margins.  Supply & demand, there are only so many mortgages we could close in a 60 – 90 day window.

  92. One of the biggest conferences in my industry (translation) just got postponed to September! They expected people from around the world, so I guess that was a no-brainer!

  93. 30 year is 3.25 in Ohio

    My brother worked for penny mack until yday and he said all there channels are backed up with refi with no relief in site could be awhile before rates move lower

  94. I hate to have on a tin foil hat again…

    There is a disconnect between the information I am getting from 3 state public health departments, the US Government, Dr. Fauci and data I have from colleagues in China, Korea and Japan. 

    The interesting part:  What Dr. Fauci is saying and the information I have from my Asian colleagues is consistent!

    “When you have a brand new virus, in which no one has had any experience before, that kind of gives the virus an open roadway to spread,” he said.

    He also warned of the infection’s alarming mortality rate.

    “If you look at the people who have just come to the attention of the health authorities, that’s 2 to 2-and-a-half percent,” Fauci said. “But even if it goes down to 1 percent, that’s still very, very serious.”

    “So if it went from 2 percent to 1, [it is] still 10 times more lethal than the standard influenza that we get on a seasonal basis,” he added.

  95. Dawgy -"However we'll break the country on healthcare spending saving the other 98% of the useless old people so there's that to think about too."

    That's a terrible thing to say.  This is the generation who helped make America great. Now that they're old, they are useless ?

  96. The baby boomers made this country great?  My God, it's  the boomers that sold the country to the financial institutions…