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Which Way Wednesday – Virtual Fed Meeting Edition

Comic: Addicted Markets Beg Powell For More Fed Rate Cuts As S&P ...Will Powell be wearing pants?

That is the burning question on everyone's mind as the Chairman of the Federal Reserve will be zooming in his address to the nation at 2:30 this afternoon.  Powell has already said (3 week ago) that the Fed will act "forcefully" to help the US recover and that the economy can be "robust" once the virus is contained.  Traders are assuming that means more of the same today but today it's Powell's job to assess whether or not the virus is contained – so that's a potential point of disappointment as well as the strong likelihood that Powell will have a "wait and see" approach as clearly they can't possibly have spent the $4Tn they have been allocated yet, so those expecting more from the Fed are likely to be disappointed.  

We are certainly waiting and seeing this morning and we have a list of 16 positions we are thinking about trimming from our Member Portfolios, about 20% of the total and we'll discuss two of them here in our Money Talk Portfolio Review, as I'll be on the show this evening (BNN at 7:30) and we only adjust the portfolio on show days. 

The last time I was on the show was March 11th, a bit before we hit bottom and I made a call for jumping into blue chips and I made a call for selling puts on stocks you want to buy, using Valero (VLO) and Ford (F) as examples.  We also added Tanger Factory Outlets (SKT) as a long-term dividend play.  Our Money Talk Portfolio was down 8.4% at the time and we made a series of aggressive moves I detailed in that morning's PSW Report – in order to take advantage of the market decline.  

We had the advantage of being mostly in CASH!!!  In fact, we had $99,235 of cash in the portfolio while the positions themselves were worth -$7,670 for net $91,565 out of our original $100,000 we began with back on 11/13/19.  We had stayed "Cashy and Cautious" – as we did with all of our Member Portfolios, as we felt fairly certain that SOMETHING was going to cause the market to sell off – we just didn't expect it to be a virus!

We used $14,540 of our sideline cash to make adjustments and another net $1,425 was spent on the three new positions (our core strategy at PSW is to sell premium, not to buy it).  So far, so good as we're back to $101,825 as of yesterday's close but we're a little worried about two of our positions and we're going to add a couple as well:

  • Ford (F) – They made it through the last crisis without a bailout so we think net $3.65 would be a great entry but, on the whole, we're very confident we'll collect the full $2,750 that is currently charged against us.

  • Valero (VLO) – Another new addition and already nicely profitable.  All VLO has to do is not be below $40 in Jan of 2022 and we make another $3,925 – aren't options fun?  Our worst case would be owning VLO for net $28, less than half of the current price!    

  • Freeport MacMoRan (FCX) – As much as I love this company, we are dumping them as I don't see Congress getting around to doing infrastructure spending we were expecting and we've already had a nice bounce so better to use the money on more productive plays.  

  • Barrick Gold (GOLD) – Our Stock of the Year is actually one of the best-perfoming stocks of the year and we are very confident we'll collect the full $12,000 on this spread and it's only net $4,635 at the moment so $7,365 (158%) left to gain if GOLD stays above $17.  Good for a new trade as it's so conservative for a still very nice reward now.  

  • IBM (IBM) – Last year's Stock of the Year is doing well, considering and I'm very confident in our target for 2022.  It's a $24,000 spread and currently showing a net $400 credit so I'd call that good for a new trade with $24,400 (6,100%) of upside potential and your worst case is owning 400 shares of IBM for $135 ($54,000), which would be a bit much for this portfolio but I was supremely confident that wouldn't be an issue – though the drop was scary.  

  • IMax (IMAX) – Not that I don't love them but they don't have long-term options and I'm not sure when movies will be a thing again so it's just not worth the risk and we'll take the small loss and move on.  

  • Tanger Factory Outlet (SKT) – This is a mall REIT (Boo!!!) that I think is ridiculously undervalued but a lot of people disagreed and we went as low as $4.  In our active Member Portfolios, we doubled and even tripled down as it bottomed but here we're stuck with our net $6.17 entry and I feel strongly we'll get to $10 at least for $10,000 and it's currently net $4,880 so $5,120 left to gain.

  • Sunpower (SPWR) – A great solar player that has gotten stupidly cheap.  This is a potential $10,000 spread that is currently at net $20 so it has $9,980 of upside potential at $10 – so it's great for a new trade.

The new trade ideas we're adding to the Money Talk Portfolio are as follows (I was interviewed on Monday so I'm adjusting the numbers to meet yesterday's closing prices):

ViacomCBS (VIAC) – One of America's premier broadcast networks is having a fire sale at $17.45, which is about an $11Bn valuation for a company that made $3.3Bn last year.   Even if earnings drop to $2Bn, that would be a ridiculously low 5.5 times earnings for the p/e ratio.  Sometimes, I can't even imagine what traders are thinking and this would be my Stock of the Year – if I could pick it right now.

We'd like to add VIAC to the MTP as follows:

Sell 10 VIAC 2022 $15 puts for $5 ($5,000)
Buy 20 VIAC 2022 $13 calls for $9 ($18,000)
Sell 20 VIAC 2022 $20 calls for $5.50 ($10,000)

That's net $3,000 on the $14,000 spread so the upside potential at just $20 $11,000 (366%) if VIAC is over $20 in Jan of 2022.  If Viacom is under $15 you risk being assigned 1,000 shares at $15 ($15,000) and if you lose the entire spread, then that cost you $3,000, putting you in 1,000 shares at an average of $16.50 so your worst case is still owning VIAC at a 10% discount to the current price.  Originally we had sold the $13 puts but VIAC is up 10% this week and now I'm confident in the $15 puts.

Our 2nd addition is going to Macy's (M), which has been trashed with the other retailers and yes, retail is horrible and was horrible before the virus but now many retailers will go out of business and Macy's is likely to survive as they own about half their stores – including an entire city block in the middle of Manhattan that's worth as much as $5Bn and $6/share values M at just $2Bn.  Of course they have debts and such but, when you have assets – you have a good chance of surviving and the competitors who do not survive should help M grow in the future.

We'd like to add M to the MTP as follows:

  • Sell 10 M 2022 $5 puts for $1.80 ($1,800) 
  • Buy 30 M 2022 $5 calls for $3 ($9,000)
  • Sell 30 M 2022 $10 calls for $1.35 ($4,050) 

That's net $3,150 on the $15,000 spread so the upside potential is $11,850 (376%) at $10 and your worst case is owning 1,000 shares of M for $5 ($5,000) plus $3,150 if the spread is wiped out so $8.15 per share is quite a bit more than it is now, so we're being aggressive.

The upside potential from the existing trades is $53,540 and our new trades will hopefully add another $22,850 so that's $76,390 we hope to gain in our $100,000 portfolio over the next two years.  That's if all goes well, of course and, so far, it has not but now we have positions set at real bargain prices and all we have to do is move past this virus and we should be in ecellent shape.

8:30 Update:  Q1 GDP is down 4.8%, a bit worse than expected and it only contains a few weeks of March, when we began to take the virus seriously in the US.  That does not bode well for Q2 but FORGET THAT as Gilead (GILD) is halted on news that a study of their anti-viral drug has shown positive results against the coronavirus.  THAT is boosting the futures.  GILD was our second virus play way back in our February 3rd PSW Report (subscribe here): "Just Another Manic Monday" – our first virus hedge was actually on January 23rd: "How We Are Hedging China's Coronavirus Crisis" – if only Trump had listened to me then! 

Our trade idea for Gilead was as follows:

Gilead (GILD) is up 5% pre-market because they have been working on an anti-viral drug for Ebola and SARS called Remdesivir and it's being rushed into human trails in China to see if it will be effective against the Coronavirus. 

I like GILD down here at $65.50 (where it should open) as it's "just" an $80Bn valuation and GILD is good for about $8Bn in profits, though not last Q when they lost $1.2Bn on write-offs and such.  Overall, they are a great company with a respectable pipeline and I think this is a great entry so we're going to add them to our Long-Term Portfolio as follws:

  • Sell 5 GILD 2022 $62.50 puts for $8 ($4,000) 
  • Buy 15 GILD 2022 $55 calls for $13 ($19,500) 
  • Sell 15 GILD 2022 $65 calls for $8.50 ($12,750) 

That's net $2,750 on the $22,500 spread so $19,750 of upside potential if GILD can simply hold $55 through Jan, 2022.  Ordinary margin on the short puts is $2,400 so it's a very efficient way to make $19,750 over 2 years.

While we can look for potential brights spots, like GILD, the bottom-line is that the entire first Quarter for China is now shot to Hell and that's a $13Tn economy so $3Tn+ potentially hit and I'd say that's at least a $1Tn hit to the Global GDP (1%), which has a good chance of pushing many countries into recession – and that's WITHOUT the virus spreading.  

Only 11 cases in the US at the time (Feb 3rd), now over 1 Million!  So sad… 

Not so sad for our GILD trade though, as the stock has already blasted up to $80 and much higher today, I'm sure so we can expect to make the full $19,750 on that one but the best thing is that WE JUST DOUBLED DOWN ON IT in our recent Long-Term Portfolio Review.  


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  1. Good morning, All!

    Join Phil at 1pm today for this week's webinar!

  2. GM all!  Phil, in the above post, take out in the "vaccine" in the GILD quote.  Remdesivir is a drug, not a vaccine.  I don't want the pundits poking at you!

  3. Good Morning.

  4. Good Morning

  5. Good morning!

    GDP and GILD kind of cancelling each other out and, of course, GILD is no miracle cure – just a start.  

    Thanks Pharm.  I know that now but I didn't in Feb, where I pasted that from.

    GILD popped to $88 but calming down to the 5% line at $82.50 as it's only and encouraging study.  Jeeze, get a grip chasers!  

    I made my kids watch this movie when they were about 12/13 (because we had an autistic neighbor and I wanted them to get some insights) and they were like "Dad, WTF?"  

  6. Good Morning Phil!

    Yesterday I got the 2022 SPG $45 Puts at $14 (thank you!) -but the call spread got away from me.  Would you pay up for same spread today with this pop or maybe move to the $45/$75 spread instead and if so what price would you say?  Thanks.  Tim.

  7. SPG/Hicket – Sometimes it's our Members that make things pop as we have a lot of heavy hitters here, so you have to be careful about chasing – especially on a Top Trade Alert.  So today the stock is $67.75 (from $64.44) and the 2022 $65 calls are $22.50 and they were $20 so the net is almost the same – I wouldn't change it other than maybe seeing if you get a bite at $21 for the $70s as we're rising – that would be worth paying a bit more for!  

    April 28th, 2020 at 1:12 pm | (Unlocked) | Permalink 

    In the LTP, we're happy to get 1,000 shares cheaply so we can sell 10 2022 $45 puts for $14 ($14,000) and consider that free money with a net $31 entry.  As they are such a bargain, I think we can add 20 of the 2022 $40 ($30)/65 ($20) bull call spreads for $10 ($20,000) and then we have a net $7,000 entry on the $30,000 spread.  

    For our Dividend Portfolio, let's:

    • Buy 500 shares of SPG for $64.44 ($32,220) 
    • Sell 5 2022 $65 calls for $20 ($10,000) 
    • Sell 5 2022 $45 puts for $14 ($7,000) 

    That nets us into the stock for $15,220 and the dividend alone is $4,200 (27.5%) annually and, if we get called away at $65, that's $32,500 back for another $17,280 (113%) profit over 2 years.  Not bad for a boring, dividend stock.

    Notice Finviz changed their charts – they go back more than they used to.

  8. Oops, you did the spread, not the stock.  Well, the $40s are $36 now, that's crazy and the $65s are $22.50 and that's net $13.50 on the $25 spread vs the $45 ($33)/$70 ($21.50) bull call spread at $11.50 so would I pay $2 to be $5 deeper in the money.  Actually, no since it's such a crazy low spread that $70 is about as sure of a thing as $65 – so I guess I would take the higher spread in this case.

  9. Somehow we had and actual draw in Gasoline:

    • EIA Petroleum Inventories: Crude +9.0M barrels vs. +10.6M consensus, +15.0M last week.
    • Gasoline -3.7M barrels vs. +2.5M consensus, +1.0M last week.
    • Distillates +5.1M barrels vs. +3.6M consensus, +7.9M last week.
    • Futures (CL1:COM +26.5%)

    • As many as 25 liquefied natural gas cargoes originally scheduled for June loading from U.S. facilities likely have been canceled, as European and northeast Asian spot prices have dropped to all-time lows, Argus reports.
    • Asian and European firms may have canceled loadings for as many as 16 cargoes from Cheniere Energy's (LNG +3.7%) Sabine Pass LNG terminal in Louisiana and Corpus Christi LNG terminal in Texas, and five cargoes likely were turned down from the Freeport LNG export plant in Texas, according to the report.
    • Most of the contracts are signed on a "take-or-pay" basis, meaning that buyers will still have to pay liquefaction costs even if they cancel purchases.
    • Pending Home Sales-20.8% to 88.2 vs. -10.0% consensus and +2.3% prior (revised).
    • “The usual Spring buying season will be missed, however, so a bounce-back later in the year will be insufficient to make up for the loss of sales in the second quarter,” he said. “Overall, home sales are projected to have declined 14% for the year.”said Lawrence Yun, NAR’s chief economist.

    • State Street Investor Confidence Index: 73.0 vs. 73.7 in March (revised from 71.3).
    • The Asian ICI fell 18.3 points to 80.0, while North American ICI crept up 1.2 points to 68.0 and the European ICI incresed to 102.8 from 95.5.
    • Barclays (NYSE:BCS) jumps 12% in U.S. trading after Q1 results showed robust gains in FICC income at its Corporate and Investment Bank markets business.
    • In its markets business, revenue run-rate in April so far is well above Q2 2019.
    • Takes £2.1B impairment in the quarter, reflecting its initial estimate of the impact COVID-19 is expected to have on credit losses.
    • Q1 group profit before tax of £913M, including the impairment, fell 38% Y/Y.
    • Q1 total income of £6.38B increased 20% Y/Y; net interest income of £2.33B slipped from £2.34B in Q4 2019 and increased from £2.26B in the year-ago quarter.
    • FICC income of £1.86B more than doubled from £902M in Q1 2019 and £726M in Q4 2019.
    • Overall, Markets income of £2.42B rose from £1.37B in Q1 2019 and £1.14B in Q4 2019.
    • Sees Barclays UK and Consumer, Cards and Payments income headwinds for the rest of the year, due to lower interest rate environment and macro downturn caused by the pandemic.
    • Sees group return on tangible equity of more than 10%.
    • Previously: Barclays reports Q1 results (April 29)

    • Restaurants stocks are rallying as more states talk of opening of opening up for business and with more operators posting sequentially improving week-to-week to-go order sales. In some cases, the to-go business is exceeding expectations.
    • 43 out of the 45 publicly-traded restaurant stocks are in positive territory today. One of the two with a loss on the day is Domino's Pizza (NYSE:DPZ-0.5%, presumably as a bet that pandemic-related delivery orders may have peaked.
    • Notable advancers include Brinker International (EAT +34.8%), RCI Hospitality (RICK +32.8%), Dine Brands Global (DIN +26.2%), Red Robin Gourmet Burgers (RRGB +19.2%), Fiesta Restaurant Group (FRGI +19.9%), Cheesecake Factory (CAKE +17.7%), Denny's (DENN +15.8%), Noodles (NDLS +11.1%), Biglari Holdings (BH +9.6%), FAT Brands (FAT +8.4%), Chuy's Holdings (CHUY +8.4%), Del Taco (TACO +7.1%), El Pollo Loco (LOCO +7.8%), Darden Restaurants (DRI +8.2%) and Texas Roadhouse (TXRH +6.2%).
    • The positive results from the SIMPLE trial and the expected positive outcome from an NIAID-led study should be all the data necessary for the FDA to OK the emergency use of Gilead's (GILD +3.1%) remdesivir for the treatment of COVID-19 patients, says Jefferies' Michael Yee, who has a Buy rating and $89 price target (10% upside) on the stock.
    • Yee notes that the positive result from the government-run study (as opposed to Gilead's own study) is of particular importance given its more rigorous nature.
    • Gilead itself has been bullish on the drug's prospects, and has been taking steps to ramp up production for some time now.
    • SunTrust's Robyn Karnauska suggests caution, noting the revenue proposition for the drug is cloudy. She maintains a Hold rating and $70 price target (about 15% downside).
    • Speaking on Seeking Alpha's Alpha Trader podcast late last week, Adam Feuerstein seemed to agree with Karnauska, noting Gilead has already promised to give away all existing supplies of remdesivir.
    • General Electric (GE +0.4%) has edged into positive territory following the company's earnings conference call, despite Q1 results that some analysts consider "disappointing."
    • "Considering that GE had previously established a pattern of 'beat and raise,' we anticipated a result above 10 cents and a better free cash flow print," says bearish Gordon Haskett analyst John Inch.
    • "We expected the results to beat considering GE's bullish outlook comments provided in early March, particularly toward its Aviation business," Inch says.
    • While Aviation profit margins fell more than was predicted, GE's forecast that the unit will see a slow recovery "should not surprise investors," says Barclays analyst Julian Mitchell.
    • Q1 results are somewhat irrelevant given the severe downturn, especially in aerospace, began late in the quarter and will be pronounced in Q2 and beyond, according to Cowen's Gautam Khanna.

  10. Phil – That was a weird gasoline draw number….

  11. Top US companies say sales are improving in China

    • Stocks move higher at the open as investors await Federal Reserve Chairman Powell's 2:30 p.m. ET press conference after the central bank concludes its two-day policy meeting; Dow +1.8%, S&P 500 +1.9%, Nasdaq +2.3%.
    • Stocks enjoyed an extra boost after Gilead Sciences (+3.5%) reported that its heavily watched remdesivir COVID-19 drug met the primary endpoint of a government run study.
    • Sentiment also is helped by Alphabet's (+7.8%) smaller than expected decline in revenue growth decline while YouTube ad revenues also beat expectations.
    • Meanwhile, U.S. Q1 GDP shrank 4.8%, the biggest slide since 2008 and the first contraction since 2014, led by a plunge in consumer spending due to coronavirus restrictions.
    • European bourses trade broadly higher, with U.K.'s FTSE +2%, Germany's DAX +1.8% and France's CAC +1.2%; in Asia, Japan's Nikkei -0.1% and China's Shanghai Composite +0.4%.
    • In the U.S., the communications sector (+4.2%) tops the early S&P sector leaderboard on post-earnings strength in Alphabet, while energy (+3.9%) is another standout.
    • WTI June crude oil +27.1% to $15.69/bbl following a report that showed a smaller than expected build in U.S. inventories as well as hopes that economies will reopen sooner than expected.
    • U.S. Treasury prices edge higher, with both the 10-year and two-year yields down a basis point at 0.60% and 0.19%, respectively.
    • Gilead Sciences (NASDAQ:GILDannounces positive results from an open-label Phase 3 clinical trial, SIMPLE, evaluating five- and 10-day courses of antiviral remdesivir in severely ill hospitalized COVID-19 patients.
    • Efficacy was similar between the two courses with no new safety signals observed.
    • The time to clinical improvement for half the patients in the five-day arm was 10 days and 11 days in the 10-day group. 60% (n=120/200) of the patients in the five-day cohort were discharged from the hospital by day 14 while 64.5% (n=129/200) experienced clinical recovery by day 14. 52.3% (n=103/197) of the patients in the 10-day arm were discharged by day 14 and 53.8% (n=106/197) achieved clinical recovery during that time.
    • Clinical outcomes varied by geography. Outside of Italy, the mortality rate was 7.2% (n=23/320) across both treatment groups. 64.1% (n=205/320) of treated patients experienced clinical improvement by day 14 while 61.3% (n=196/320) were discharged from the hospital.
    • The most frequent treatment-emergent adverse events in the five-day and 10-day groups were nausea (10.0%, 8.6%) and acute respiratory failure (6.0%, 10.7%).
    • Grade 3 (severe) or higher elevations in liver enzyme ALT (biomarker for liver stress/damage) were reported in 7.3% of patients. The discontinuation rate was 3.0% due to elevated liver tests.
    • The overall discontinuation rates in the five-day and 10-day treatment groups were 4.5% (n=9/200) and 10.2% (n=20/197), respectively.
    • The overall mortality rates in the five-day and 10-day groups were 8.0% (n=16/200) and 10.7% (n=21/197), respectively.
    • The results will be submitted for publication in the coming weeks.
    • The results from an NIAID-led study also appear successful.
    • Shares, currently halted, will resume trading at 9:00 am ET.
    • Update: Shares up 9% premarket.
    • Gilead Sciences (NASDAQ:GILD) says it’s aware of positive data emerging from the National Institute of Allergy and Infectious Diseases’ ("NIAID") study of the investigational antiviral remdesivir for the treatment of COVID-19.
    • “We understand that the trial has met its primary endpoint and that NIAID will provide detailed information at an upcoming briefing,” company says.
    • The NIAID trial aimed to sign up 600-800 patients and give a definitive answer as to whether remdesivir can help treat the virus.
    • Separately, GILD published results from its phase 3 SIMPLE trial evaluating 5-day and 10-day dosing durations of the investigational antiviral remdesivir in hospitalized patients with severe manifestations of COVID-19 disease. Says patients receiving a 10-day treatment course of remdesivir achieved similar improvement in clinical status compared with those taking a 5-day treatment course.
    • "Gilead will continue to discuss with regulatory authorities the growing data set regarding remdesivir as a potential treatment for COVID-19," it says.
    • “Unlike traditional drug development, we are attempting to evaluate an investigational agent alongside an evolving global pandemic. Multiple concurrent studies are helping inform whether remdesivir is a safe and effective treatment for COVID-19 and how to best utilize the drug… The study demonstrates the potential for some patients to be treated with a 5-day regimen, which could significantly expand the number of patients who could be treated with our current supply of remdesivir. This is particularly important in the setting of a pandemic, to help hospitals and healthcare workers treat more patients in urgent need of care.”
    • Remdesivir is not yet licensed or approved anywhere globally.
    • As of 9:04, shares of Gilead (GILD) are changing hands at $86, up about 9%. They were halted at about $79 prior to the news.
    • The news appeared to lift index futures, which jumped immediately after GILD issued the first pr
    • Source: Press release Ipress release II
    • Catalent (NYSE:CTLT) will collaborate with Johnson & Johnson (NYSE:JNJ) unit Janssen Pharmaceutical Companies to accelerate manufacturing capacity and prepare for large-scale production of J&J's lead COVID-19 vaccine candidate.
    • The parties will jointly invest in the scale-up of capacity over the coming months. Catalent expects to hire ~300 additional employees at its Bloomington, IN site starting in July with the objective of operational readiness for 24/7 production by January 2021.
    • Financial terms are not disclosed.
    • CTLT is up 6% premarket while JNJ is up a fraction, both on light volume.

    • Investors are giving the airline sector a hard look again after Southwest Airlines (NYSE:LUV) drew attention by reporting a narrower-than-expected loss yesterday and with some of the worst case fears of the collapse in travel demand fading as stay-at-home orders expire.
    • Premarket movers: American Airlines (NASDAQ:AAL+8.44%, Delta Air Lines (NYSE:DAL+5.01%, United Airlines (NASDAQ:UAL+5.07%, JetBlue (NASDAQ:JBLU+6.76%, Hawaiian Holdings (NASDAQ:HA+5.81%, Alaska Air Group (NYSE:ALK+4.50%, Allegiant Travel (NASDAQ:ALGT+3.22%, Spirit Airlines (NYSE:SAVE+10.53%, Mesa Airlines (NASDAQ:MESA+3.03%, SkyWest (NASDAQ:SKYW) +2.84%.
    • Southwest Airlines is sitting out the early rally after pricing an upsized equity and note offering. Some analysts have suggested that the airline companies that act early with equity raises will get better pricing than those that wait for later in the year. LUV is off 2.22% premarket.
    • Cowen trims its price target on Spirit Airlines (NYSE:SAVE) to $19 from $21. The PT is below the average sell-side target of $20.08, but reps upside potential of more than 20% for the carrier.
    • Analyst Helane Becker: "Spirit's outlook is being negatively affected by a decline in demand as a result of the coronavirus. Spirit's model in a post-coronavirus / social distancing world bears watching as density has been a pillar of the model in the past. In the near-term, Spirit does not have any liquidity needs, but the company will likely look to further bolster their cash / liquidity position."
    • SAVE +10.88% premarket to $15.90 amid a broad rally in airline stocks this morning.

    • BMO Capital Markets lowers UPS (NYSE:UPS) to an Underperform rating from a prior stance of Market Perform.
    • "The coronavirus (COVID-19 virus) led global recession is likely to accelerate the pace of growth in residential deliveries, shift volume mix toward larger customers, and potentially drive unfavorable changes in global trade patterns, including near shoring higher-value goods that typically utilize air cargo," warns analyst Fadi Chamoun.
    • "While cyclical headwinds will eventually ease, we believe that there is a structural component to the current compression in operating margins, which will mute the earnings, free cash flow, and ROIC recovery," adds Chamoun.
    • BMO drops its price target to $85 from $95 vs. the average sell-side PT of $106.84.
    • UPS +0.55% premarket.

    Robot (NASDAQ:IRBT-6% on revenue warning.

    Tupperware Brands (NYSE:TUP-7% on Q1 earnings.





    • SeaWorld Entertainment (SEAS +11.2%) is lobbying the government for a federal loan even after it furloughed 95% of its employees and has paid little in income taxes over the years, according to the Orlando Sentinel.
    • "Over the past 10 years, records show the company has earned nearly $193 million in pretax profits. But it has paid less than $8 million in total income taxes," reports Jason Garcia and Gabrielle Russon in the exclusive.
    • The tiny tax bill is said to be the result of a multibillion-dollar private-equity buyout of the company orchestrated just over 10 years ago.
    • SeaWorld is expected to be just one of many public companies under scrutiny for their loan requests.
    • Google (NASDAQ:GOOGL), just days following Facebook's entrance into the video conference gauntlet, announced it was making its "Meet" product free to all users with an email address, regardless of whether they were subscribers to the G suite of products.
    • Current juggernauts in the video conferencing space, like Zoom (NASDAQ:ZM) and Microsoft (NASDAQ:MSFT) Teams, have seen increased usage since the Covid-19 outbreak, and Google was no exception, disclosing that since January, Meet's peak daily usage grow by 30x.
    • Google Cloud notes Meet is hosting 3B minutes of video meetings and adding 3M users per day. Daily meeting participants passed 100M in April.
    • Google also touted its extensive security features, in an apparent veiled reference to Zoom's recent struggles in that arena. Zoom still has many more users, noting it recently passed 300M daily participants.
    • Existing G suite members will get advanced access, including additional Meet licenses.
    • Starting in October, Meet will cut free calls after an hour. Zoom consumer calls are capped at 40 minutes, while Facebook Messenger and Microsoft's Skype have no limits.
    • Shares of Sherwin-Williams (NYSE:SHW) break higher in early action after topping Q1 profit estimates.
    • Comparable sales in the U.S./Canada were up 7.4% during the quarter and the performance coatings business saw revenue hold level with last year's mark. Profit in the Americas segment was $388M vs. $376M consensus.
    • CEO outlook: "We anticipate that the rapid deterioration of the U.S. and global economies experienced late in the first quarter due to the COVID-19 pandemic will most likely continue through the second quarter. We see no immediate, meaningful improvement ahead in most end markets we serve, and we are unable to predict when any noticeable improvement will occur. Given the trends and indicators we see at this time, we anticipate second quarter 2020 consolidated net sales will decrease by a low-to-mid-teens percentage versus the second quarter of 2019."
    • The company expects FY20 EPS of $16.46 to $18.46 vs. $19.91 to $20.71 prior view and $20.00 consensus. That consensus estimate isn't fully updated to reflect the pandemic impact.
    • Previously: Sherwin Williams EPS beats by $0.19, beats on revenue (April 29)
    • SHW +4.08% premarket to $529.50.
    • Valero Energy (NYSE:VLO+3.6% pre-market after routing expectations for Q1 earnings and revenues.
    • On a GAAP basis, Valero posted a $1.85B net loss compared with net income of $141M in the year-ago quarter, taking a $2B hit to the value of its refining inventory.
    • The refining segment reported a $2.1B operating loss for Q1 compared to $479M of operating income for the prior-year quarter; Q1 refinery throughput volumes averaged 2.8M bbl/day, in line with the year-earlier quarter.
    • Valero lowers its planned 2020 capital spending by $400M from prior guidance to ~$2.1B.
    • Valero says it has slowed by 6-9 months the mechanical completion of a coker expansion at its Port Arthur refinery.
    • The company says the new St. Charles Alkylation Unit remains on track to be completed in 2020, and the Diamond Pipeline expansion should be completed in 2021.
    • Valero ended Q1 of 2020 with $11.5B of total debt and finance lease obligations and $1.5B of cash and cash equivalents.

  12. Oklahoma, Utah face scrutiny over malaria drug purchases

  13. Restaurants are moving and so has gasoline…party on… ;)

  14. Trump orders meat processing plants to remain open

    • Yum Brands (NYSE:YUM) reports comparable sales fell 7.0% in Q1 vs. -6.8% consensus.
    • Comparable sales by brand: KFC -8% vs. -7.5% consensus, Pizza Hut -11% vs. -6.1% consensus, Taco Bell +1% vs. -0.7%.
    • Restaurant-level margins fell at KFC and Pizza Hut, but improved to 22.4% of sales at Taco Bell.
    • Core operating profit fell 6% during the quarter as foreign currency translation unfavorably impacted divisional operating profit by $6M.
    • Yum Brands says it opened 65 net units during the quarter and acquired 276 Habit Burger Grill units for 4% net unit growth.
    • Shares of Yum are down 1.44% premarket to $87.00.
    • Deutsche Bank (NYSE:DB) gains 5.8% in premarket trading in the U.S. after its Q1 results showed strong performance in its investment bank unit.
    • Q1 profit before tax of EUR 0.2B improved from a EUR 1.3B loss in Q4 2019 and fell from EUR 0.3B in Q1 2019.
    • Q1 total net revenue of EUR 6.4B increased from EUR 5.3B in Q4 2019 and was flat with the year-ago quarter figure.
    • The German lender took a EUR 506M provision for credit losses  vs. EUR 247M in Q4 2019 and EUR 140M in the year-ago quarter.
    • Q1 net interest income of EUR 3.25B was roughly flat Q/Q and down 3% Y/Y.
    • Q1 Investment Bank revenue of EUR 2.34B rose 54% Q/Q and 18% Y/Y, with FIC Sales & Trading revenue of EUR 1.85B up 57% Q/Q and 13% Y/Y.
    • Q1 Investment Bank profit before tax of EUR 622M compared with a loss of EUR 67M in Q4 2019 and surged 149% from a year ago.
    • Previously: Deutsche Bank Aktiengesellschaft reports Q1 results (April 29)
    • Brinker International (NYSE:EAT) says it's gradually improving sales as Chili's and Maggiano's operate in an off-premise only model.
    • Company-owned comparable sales were -64.6% for the week ending April 1, -59.7% for the week ending April 8, -53.1% for the week ending April 15 and -46.8% for the week ending April 22
    • During FQ3, restaurant level operating margin fell to 12.8% of sales vs. 14.3% a year ago. Operating income as a percentage of sales was 4.8% vs. 8.4% a year ago.
    • Balance sheet update: "We have total liquidity of $175 million, comprised of total cash and revolver availability. Given the current sales levels and reductions in expenses, we estimate an average cash burn level of approximately $5 million per week while our business is primarily operating as off-premise."
    • Shares of EAT are up 12.00% premarket.
    • Previously: Brinker EPS beats by $0.76, beats on revenue (April 29)

    See, that's a nice, well-presented bit of information I wish we could get  from everyone!   This is why things are so oversold, people imagine burn rates are so much worse than they really are. 

    • General Electric (NYSE:GE-2.8% pre-market after missing expectations for Q1 earnings and free cash flow but beating on revenues, while expecting Q2 results will decline sequentially under pressure from the effects of COVID-19.
    • Free cash flow from industrial operations was negative $2.21B in the quarter, below negative $1.22B in the prior-year quarter and analyst estimates of negative $2B.
    • GE says the pandemic reduced FCF by ~$1B and took an $800M chunk out of industrial profit as well as $100M from GE Capital earnings.
    • Within GE's business segments, revenue misses in Power and Aviation were offset by beats in Healthcare and Renewable Energy.
    • While COVID-19 has begun affecting operations at varying levels across all of GE's businesses, the company says the most significant financial impact has been at Aviation and GECAS because of the rapid decline in global commercial aviation demand in March.
    • Hasbro (NASDAQ:HAS) reports revenue increased 20% in the U.S. and Canada to $429M in Q1 to offset a drop of 11% in the international business.
    • With consumers staying home more during the quarter, revenue in Hasbro's gaming business jumped 30% Y/Y to $140M. Strong demand was cited for Dungeons and Dragons, Monopoly and Magic: The Gathering.
    • The company reports gross margin fell to 76.2% of sales vs. 72.5% consensus. Operating margin came in at 13.7% of sales.
    • Hasbro pulls its prior full-year guidance due to the uncertainty around the pandemic.
    • Shares of Hasbro are down 1.25% premarket to $76.89.
    • Previously: Hasbro EPS beats by $0.01, misses on revenue (April 29)
    • U.S. stock futures follow most global markets in indicating a higher open, as today's conclusion of the Federal Reserve policy meeting is expected to keep the benchmark interest rate near zero and continued strong support for business during the COVID-19 pandemic.
    • At last check, Dow +0.8%, S&P +0.9%, Nasdaq +1.1%.
    • "The Fed may give forward guidance on how long rates will stay low," says Eddy Loh of Maybank Group Wealth Management in Singapore, adding that investors also want to hear the Fed's view of how the economic recovery could play out.
    • The Commerce Department's first look at Q1 gross domestic product today surely will reinforce analysts' forecasts that the economy already was in a deep recession.
    • GDP probably fell at a 4% annualized rate in the quarter, according to a Reuters survey of economists, which would be the steepest pace of contraction since Q1 2009.
    • Yum China Holdings (NYSE:YUMC) and the Lavazza Group as a joint venture opened new Lavazza Flagship Store in Shanghai.
    • "We are thrilled to partner with Lavazza and to bring their authentic Italian coffee experience to China. This is a great news for consumers who seek a premium coffee experience and we are excited to welcome them to the new flagship store," said Joey Wat, CEO of Yum China. "We see great potential for coffee in China and Lavazza shares this enthusiasm. Leveraging our deep understanding of Chinese consumers, we look forward to working together with Lavazza to explore the coffee market in China."
    • Airbus (OTCPK:EADSFOTCPK:EADSY) reports Q1 adjusted EBIT fell 49% Y/Y to €281M ($304.7M) as revenue slipped 15% to €10.63B, as CEO Guillaume Faury warns of the "gravest crisis the aerospace industry has ever known."
    • The planemaker says it burned through €8B ($8.7B) in cash in the quarter, including a previously published €3.6B fine to settle bribery and corruption investigations in the U.K., France and the U.S.
    • Airbus says it has cut planned 2020 capital spending by ~€700M to €1.9B and will defer or suspend activities which are "not critical to business continuity" or meeting other commitments.
    • "We saw a solid start to the year both commercially and industrially, but we are quickly seeing the impact of the COVID-19 pandemic coming through in the numbers," Faury says.
    • The CEO has warned Airbus faces tough decisions on jobs but offers no update beyond the 6K-plus positions furloughed in France and the U.K.
    • Airbus shares have fallen ~60% YTD, similar to rival Boeing, which also reports earnings today.

    Yikes, that's only Q1!  BA may be a buy for the same reason M is a buy – their competitors are going BK.  

    • Crude oil prices climb (CL1:COM) after a report from the American Petroleum Institute showed a smaller-than-expected U.S. crude inventory build; WTI for June delivery +14.1% to $14.08/bbl, while Brent +4.1% to $21.31/bbl.
    • The API data showed U.S. crude inventories rising by nearly 10M barrels in the week to April 24, but that was below the prior week's 13.2M-barrel build and short of analyst expectations of a build of 10.6M barrels.
    • Also, Russian Energy Minister Alexander Novak reportedly said the country's oil output could fall by up to 15% this year, which would mark its first annual decline since 2008.
    • Oil prices yesterday swung between gains and losses as investors continue to watch depleting crude storage space and demand destruction from the coronavirus outbreak.
    • Energy was the only stock market sector to finish higher last week despite the plunge in WTI crude, and the sector has continued to outperform the broader market so far this week.
    • Goldman Sachs highlights a number of reasons why it is more positive on energy stocks, saying demand appears to be near a trough, shut-in announcements are becoming material, and valuation is near 25-year lows on EV/gross cash invested.
    • Petrobras (NYSE:PBR) says it has scrapped its 2020 debt reduction target due to market volatility, and will now seek to end 2020 with $87B in gross debt, the same as the level at year-end 2019.
    • Petrobras previously had said it planned to end 2020 with a ratio of net debt-to-EBITDA of 1.5x, which would have represented a sharp fall from the current level of ~2.4x and depended on a steady flow of sales of refineries and oilfields.
    • Weak oil prices have dampened demand for assets Petrobras wants to sell, and wild swings in Brent crude prices – which serves as the benchmark for Brazilian oil – have made net debt an extremely volatile metric, the company says.
    • South Korean military and intelligence authorities indicate that North Korean leader Kim Jong-un is handling state affairs normally, according to Yonhap.
    • "In an answer to questions from some lawmakers of the National Assembly's defense committee about Kim's health, the defense ministry, the Joint Chiefs of Staff and the intelligence authorities conveyed their assessment that Kim has been running his country normally," a source tells the news agency.
    • Kim's health has been the subject of speculation with his last public appearance on April 11.
    • South Korea's KOSPI Index is up 1.22% in Wednesday morning trading. The Korean won trades at 1217.27 per dollar.
    • Vale (NYSE:VALE) posted Q1 results that missed consensus estimates, as a sharp depreciation of Brazil's currency and a significant loss on a fuel hedging program hurt margins.
    • Vale says Q1 adjusted EBITDA was $2.88B, below analyst consensus by Refinitiv that had predicted EBITDA of $3.18B, adjusted EBITDA margin of 41%, net income of $239M and net debt of $4.81B.
    • The company cut its 2020 capital spending estimate to $4.6B from $5B in 2020, and says potential updates over the year may be necessary.
    • Vale says its cash position stood at $12.26B as of March 31, more than $4B higher than Dec. 31, after it tapped into $5B in revolving credit lines to reinforce its liquidity position to withstand increased risks prompted by the pandemic.
    • Best Buy (NYSE:BBY) plans to start seeing customers on an appointment basis in early May as the first phase of its store reopening plan.
    • Shoppers will be able to schedule a time to meet with a dedicated sales associate to talk about technology needs or make a purchase.
    • The service will be offered at about 200 U.S. stores initially.
    • Best Buy is also resuming in-home delivery, installation and repairs in early May, with additional safety precautions in place.
    • During the stay-at-period, Best Buy has retained about 70% of its sales volume, a mark higher than what some analysts initially estimated the retailer could pull off.
    • Pfizer (NYSE:PFE) is the latest vaccine developer saying that it may have a candidate ready for emergency use in the U.S. by late Q3/early Q4, yet another example of the breathtaking development speed, potentially only 9-10 months from the publication of the genetic sequence of the SARS-CoV-2 virus in January to vaccine availability, a process that usually takes ~10-11 years.
    • In the company's earnings call this morning, chief Albert Bourla said the company is planning to make "millions" of doses by the end of the year based on the expectation that clinical trials will be successful followed by a prompt FDA nod. He says the company will be able to produce "hundreds of millions" of doses in 2021.
    • The race to the finish line is in full stride. Sanofi (NASDAQ:SNY), GlaxoSmithKline (NYSE:GSK) and Johnson & Johnson (NYSE:JNJ) are all working feverishly to generate clinical data and ramp up production to meet what should be extraordinary global demand. All four companies together should be able to produce ~2B+ doses annually if their projections are accurate.
    • The battle for the future of movie theaters is heating up, with AMC Entertainment (NYSE:AMC) responding to Universal Studios comments by saying it won't play any Universal movies, effective immediately – a line in the sand that may change the industry.
    • AMC chief Adam Aron wrote to Universal Studios Chairman Donna Langley (and released the letter) complaining about Universal comments on the prospects of simultaneously releasing movies in the theaters and at home (breaking the so-called "theatrical window").
    • What upset AMC were comments in a Wall Street Journal story about the strong success of Trolls World Tour - a Universal pic earmarked for theaters before pandemic shutdowns derailed that release, and the company decided to release it to home video instead.
    • That sequel made more for Universal in three weeks of digital release than its predecessor did in five months in theaters.
    • “The results for Trolls World Tour have exceeded our expectations and demonstrated the viability of PVOD,” NBCUniversal's Jeff Shell said. “As soon as theaters reopen, we expect to release movies on both formats.”
    • Such a move "represents nothing but downside for us" and is "categorically unacceptable" to the world's biggest theater chain, AMC's Aron says.
    • "It is disappointing to us, but Jeff’s comments as to Universal’s unilateral actions and intentions have left us with no choice," AMC says. "Therefore, effectively immediately AMC will no longer play any Universal movies in any of our theatres in the United States, Europe or the Middle East. This policy affects any and all Universal movies per se, goes into effect today and as our theatres reopen, and is not some hollow or ill-considered threat."
    • After hours, AMC is up 5.3% (building on a 23.2% gain today); Universal parent Comcast (NASDAQ:CMCSA) is down 0.2%.
    • Ahead of next week's kickoff of videogame company earnings, Nomura Instinet looks to expectations that are the "highest in recent memory" amid widespread stay-at-home orders.
    • The major software publishers have outpaced the market since the S&P 500's Feb. 19 peak, Andrew Marok and team write: S&P 500 -16%, while Take-Two (NASDAQ:TTWO) is up 13% over that span, and Electronic Arts (NASDAQ:EA) +6% and Activision Blizzard (NASDAQ:ATVI) +4%.
    • Meanwhile, industrywide videogame sales posted their best March since 2008.
    • Given some broad uncertainty in the pandemic, the firm is expecting outlook ranges to be wide – and conservative. "The longer that movement restrictions are kept in place, the more the videogaming industry is likely to benefit," it says.
    • Activision may have the highest expectations among the three due to the content release pipeline around Call of Duty; The March 10 Warzone release was a standout as one of the only major releases in the pandemic, and that sets a high bar going into earnings. Nomura has a Buy rating and $70 price target, implying 10% upside.
    • Meanwhile, EA's Ultimate Team services could benefit with live sports in cold storage during the pandemic. It's looking for some information about licensing positions from the sports leagues. And Twitch numbers for Apex Legends have been strong Q/Q, the firm says. It also has a Buy rating on EA, with a $120 price target (implying 8% upside).
    • It's Neutral on Take-Two, which has done well over the past two months but has less pipeline visibility – a new BioShock may be years away and it looks like a quiet year for releases. Key questions into its earnings center on how the company's sports titles are doing (has the NBA season suspension spurred a rebound for NBA 2K20?), as well as an initial outlook for fiscal 2021. The price target of $120 compares to today's closing price of $120.51.
    • Ford (NYSE:F) plans to delay the launch of an autonomous vehicle service to 2022.
    • The automaker wants to take the time to study the long-term impacts that the pandemic will have on customer behaviors.
    • Ford has invested heavily in self-driving car initiatives, including a $1B investment in autonomous tech firm Argo AI. A commercial service was targeted to be launched in 2021.
    • Delta Air Lines (NYSE:DAL), JetBlue (NASDAQ:JBLU) and Spirit Airlines (NYSE:SAVE) formally asked the Department of Transportation for approval to suspend flights to more than two dozen U.S. airports.
    • JetBlue wants to halt flights to airports in Chicago, Atlanta, Houston, Seattle, Las Vegas, Philadelphia, Dallas and Detroit through Sept. 30.
    • Delta wants to suspend flights to Lansing, Flint and Kalamazoo in Michigan, and Worcester, Massachusetts, Hilton Head, South Carolina, Pocatello, Idaho, Brunswick, Georgia, and Melbourne, Florida.
    • Spirit Airlines wants to stop flying to Charlotte, Denver, Minneapolis/St. Paul, Seattle, Portland and Phoenix.
    • The DOT has to give permission or the carriers risk losing their landing slots.
    • Whirlpool (NYSE:WHR) discloses that it entered into a revolving 364-day $500M credit agreement with lenders in an effort to boost its liquidity position.
    • The company says the 364-day facility has a termination date of April 26, 2021
    • Key insights from Alexander Babbage's weekly "Pulse" consumer report:
    1. Almost 1/3 of all consumers have direct experience with coronavirus, having either had it themselves or knowing someone who has had it.
    2. With increased exposure, concerns about catching the virus have risen and confidence in making a full recovery has declined.
    3. A majority are concerned with their personal health and are taking steps to prevent infection.
    4. Consumers don't expect to feel safe taking any flights for the first 90 days after shelter-in-place orders end.
    5. Consumers feel safer where they can control their own space, and don't feel safe in places where space/seating is determined by others.
    6. Activities that involve touch (e.g. salons) evoke safety concerns.
    7. Younger consumers tend to feel safer and are willing to return sooner.

  15. Gasoline/1020 – We'll check out the 1pm report during the webinar – that is strange.  I see more cars on the road but not enough to flip /RB like that.

    Oil is CRAZY – not playable.  

    /RB has a better base but you can still take massive losses in the Futures. 

  16. Phil. /CLF- really popping today… is this due to Detroit starting up mid may possibly?

  17. Phil  thanks for your great VIAC call—-got out of some today

  18. Reading through the details of the Gilead tests does NOT get me excited it will be meaningful as a treatment.

  19. Bitcoin / GBTC!

  20. BDC—got out of some GBTC today—-thank you

  21. I got pac-man opening theme stuck in my head today. A true child of the 80's.

    I remember being fascinated learning Basic on a TRS-80 when I was 10. I thought to myself, computers, yeah this is going to be big. It was the first time I recall making a bona fide, broad based 'market' prediction about the future. I got the same feeling in 2011 with bitcoin.

  22. Optimism today.

    Biotech is going to push 'Rona back. Kinda like HIV but with an accelerated timeline. First there was illness discovery, expansion and the disease's main shock and awe phase. Slowly, there were effective NPIs, so that at least stopped the spread. The disease also became less virulent. Then there were treatments, drugs. Now there's vaccines and to some extent cures (viral load so low carriers can no longer transmit). It took 25 years but biotech, where we have it now with data and molecular biology, etc, I think it's 2.5 years or less. 

  23. Phil:  JO is getting cheap again.  Worth watching?  Worth initiating a position?  What is driving coffee down right now?  Thanks.

  24. CLF/Batman – Everyone is hopeful that things are getting back to normal and Q1 wasn't so bad, etc.  But Q1 was bad as that was the impact of just a few weeks of lockdown and we're a full month into Q2 totally shut down.  Still, stocks like CLF are so beaten down that real long-term value investors can't go wrong picking them up at these prices – as long as they don't mind doubling down if they drop 50%.

    VIAC/Savi – Finally waking up! 

    GILD/Tangled – I agree and it's not even progress – it's just using something we invented 10 years ago on something that we have now.  

    BitCoin/BDC – Don't get too excited.

    GILD just popped $70 – that's our 2022 target! 

    Speaking of Biotech – LABU was our 3rd coronavirus pick (3/12):


    • 3x Biotech ETF (LABU) – This index is completely falling apart, just caught up in the general selling that's going on in the market.  It fell 20% yesterday and another 20% this morning so VERY RISKY to catch this knife at $25 but we can sell 10 2022 $15 puts for $7.50 ($7,500) in the LTP to net us in for $7,500 on 1,000 shares so the risk/reward is pretty good.  Margin on that is $607 but we're also going to buy 20 of the 2022 $20 ($15)/$35 ($10) bull call spreads at $5 ($10,000) as that will be net $2,500 on the $30,000 spread with $27,500 (1,100%) upside potential if LABU can get back over $35.


    Thursday Failure – Trump Shuts Travel, Provides No Solutions, No Stimulus – Market Tanks (again)

    • 3x Biotech ETF (LABU) – This index is completely falling apart, just caught up in the general selling that's going on in the market.  It fell 20% yesterday and another 20% this morning so VERY RISKY to catch this knife at $25 but we can sell 10 2022 $15 puts for $7.50 ($7,500) in the LTP to net us in for $7,500 on 1,000 shares so the risk/reward is pretty good.  Margin on that is $607 but we're also going to buy 20 of the 2022 $20 ($15)/$35 ($10) bull call spreads at $5 ($10,000) as that will be net $2,500 on the $30,000 spread with $27,500 (1,100%) upside potential if LABU can get back over $35.

    JO/John – Too many variables.  SBUX shut down along with most coffee places in the world.  I doubt home consumption touches office consumption and, like oil, you can't just shut off the supply of coffee – it keeps coming. That means warehouse could fill up farmers need to sell at any price….

    Back down at $90 I'd go long-term long but no idea what it will do at $105.

  25. Wow, LTP up 37.5% – that's insane!   $687,580 and the STP is still $514,319 (414%) so it's another record high for the combo as we pass $1.2M.   Now we have to talk me out of cashing out with a double!  

    Webinar time (almost)

  26. Phil – what is the market expecting from the FED here? seems like they think something good is coming

  27. The above was 3/12 on LABU and two weeks later we had an emergency LTP review (as the market was crashing) and we did this:

    Submitted on 2020/03/23 at 3:08 pm

    LABU – If there was ever a time for Biotech to step up and save us, now would be it.  We'll just do the mechanical roll and move the 20 2022 $20 calls at $7.50 ($15,000) to 20 2022 $10 calls at $11.50 ($23,000) and I'm fine with the $35 target. 

    That's the whole key to this thing – you have to be Ready, Willing AND Able to take advantage of these situations.  If you are, then like Buffett, you can make a very nice long-term fortune.  Oddly enough though – he's been sharing his secrets to success for 50 years and hardly anyone actually does what he says….

  28. Fed/Coulter – I don't think people expect much today.  If they do, they'll be very disappointed.

  29. Phil-  I believe your GILD spread you are adding to the long term portfolio is $15,000, not $22,500.  

  30. bitcoin/Phil – I'm more of a 10-year chart kind of guy, as opposed to a 1-year.

  31. GILD/Rvn – You're right, something must have changed while I was writing it up.  I imagine I started with different strikes or amounts and changed my mind.  In retrospect, we should have stuck with the more aggressive spread.

    BitCoin/BDC – Well any chart is going to look good when you start in micro-fractions of a penny.  I guess that should be the new IPO strategy, start so ridiculously low that your long-term chart will always look like it's doing well for "original investors".

  32. ‘Burn. It. The. F#&!. Down.’

  33. Well, looks like we're finishing near the highs.  Our portfolios are balanced bullish enough that this is all good news for us – the question will be how we lock it in for the weekend.

  34. Over 70% of tested inmates in federal prisons have COVID-19

  35. Welcome to the worst economy ever

  36. Lloyds Banking Group’s profits slump 95%