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Wrong Way Wednesday – Re-Opening Opens the Door to Potential Disaster

Steven Spielberg Film GIF - Find & Share on GIPHYI don't want to be that guy.  

I don't want to be the guy who yells at the cheering crowds who swarm back onto the beach and into the water that the shark is still out there but, the shark is still out there!  WTF is wrong with you people?  There are now 1.2 MILLION infections in the US as of May 4th and on April 4th it was 308,000 so that's 892,000 new cases in the last 30 days – an increase of 290% in 30 days.  Even the Mayor of Amity Island would have kept the beaches closed if 3 deaths had turned into 9 deaths during the month.  There were no more deaths – so he thought it would be safe but why were there no more shark attacks?  BECAUSE PEOPLE DIDN'T GO IN THE WATER!!!

What happened when they re-opened the beaches?  Chaos!  Some states do have strict lock-downs in place and have stopped the increase in the rate of the growth of the virus and some have even decreased rate of the spread of the virus BUT IT'S STILL SPREADING IN EVERY SINGLE STATE.  Re-opening the states now when we haven't contained it in ANY state is MADNESS!!!

Only 180,000 people out of 1.2M infected have recovered from the coronavirus so far in the US.  70,500 Americans are dead – more than we lost in the 20-year Vietnam War but Donald Trump is drafting all of you into the war against Corporate Losses.  The entire planet has 257,906 deaths and 27% of those are US deaths – despite the US being only 3% of the World's population and again, that's SO FAR, as IM infected people are still waiting for their outcome from the disease and who knows how many millions will be infected if we re-open too soon.

WHY TAKE CHANCES?  Why gamble with American lives.  Trump is very quick to blame China for not warning us sooner but who didn't know about the virus heading into New Year's in China?  That was back in early January, when Trump said the US had 5 cases that would "magically" go away.  The magic didn't happen and then we had 25 cases on Feb 29th and we certainly didn't need China to warn us then, did we?  

Draft Day - Stormont Energy AdvisorsBy March 15th, 29 cases had turned into 2,900 cases in the US and finally we began a lockdown but it was far too late and far too poorly enforced and we had far too little equipment and, two weeks later, on March 31st, there were 188,000 cases in the US – almost half of those people are now dead.  By April 15th, 630,000 cases and that has now doubled and, seriously, the decision is that we can open back up – NOT because the lockdown was a success but because Predident Trump has decided to sacrifice hundreds of thousands of American lives in order to get Corporate Profits back on track.  

Why is this happening?  Once again we fall victim to having a Nation full of people who don't understand the concept of math so they accept a lot of bullshit because they don't understand the numbers.  

The US GDP is $18.5 Trillion per year so, in any given quarter, there is $4.6Tn of economic activity.  While the lockdown is devastating for the economy, it doesn't kill all of it.  We are still eating and we are still washing our clothes and using electricity and watching Netflix, etc.  In fact, the US GDP was only down 4.8% in Q1 but that only represented 2 weeks of lockdown so let's say it's 2.4% per week of damage so, in a full, 13-week Quarter, we could lose 31.2% of our GDP – that just so happens to be very much in-line with what was experienced in Asia and parts of Europe that have been shut down the longest.

31.2% of $4.6Tn is $1.435Tn and Congress has already authorized $2.7Tn to offset the economic damage caused by the virus.  That alone is enough to keep the country locked down for 6 months if we have to.  The Federal Reserve has access to another $4Tn that they can disburse if necessary so we have MUCH MORE THAN ENOUGH money to get us through an extended lockdown.

Understanding the Circular Flow of Income and… | Economics | tutor2uUS wages are $6Tn a year and the average Dollar earned gets spent 3 times in the economy – hence the $18Tn GDP.  But again, any 3 months of labor is 1/4 of $6Tn and that's only $1.5Tn so the Government again has/had enough money to simply pay everyone's salary for 6 months – taking the burden off employers and giving the people all the money they usually spend, which would then trickle back up to the employers.

It would have been the simplest thing in the World to send eveyone in America 1/3 of their 2019 declared Income as a stimulus check to cover 100% of a 3-month closure.  Of course there would be some cases where people and businesses would still need special bailouts but 167M working, tax-paying Americans would have been taken care of right away.

Donald J. Trump Foundation Slush Fund Update

Why did this not happen and why the rush to re-open America?  Well, do you remember the $500Bn that Trump carved out of the first $2.2Tn bailout that he was able to disburse at will and then he fired the guy who was supposed to provide Congress with oversight?  That's called a "Slush Fund" and the faster Trump ends the lockdown, the more of that money he gets to keep, presumably to attempt to buy the next election.

Who is "overseeing" that $500Bn fund now, why it's Brian Miller, Trump's White House Counsel who defended him in the impeachment trial.  Trump has already issued a statement that assertings his right, not only to withhold information from Congress about the coronavirus bailout payments, but to deny Congress even the right to know what information is being withheld, or that a cover-up is under way.

Even at 2%, the interest on $500Bn is $10Bn – almost $1Bn per month that Trump can skim off the top by simply delaying aid payments but the complete lack of oversight and reporting to Congress means the President can do whatever he wants with $500Bn – including giving it to his friends and family or to countries that won't allow him to be extradited once he's on the run.  

David Corn on Twitter: "An interview with Elizabeth Warren ...Trump has already declared victory and is winding down the Coronavirus Task Force but the virus itself shows no sign of winding down.  Winding down the task force allows Trump to stop spending his $500Bn, leaving him with a massive election war chest he can distribute (or pilfer) at will.  Should this "Mission Accomplished" moment be as ridiculous as Bush's – don't think for a second Trump will be shy about asking for another $500Bn – even while telling us that he refuses to account for the first $500Bn – that's just the kind of guy he is, and you know that's true.

So, while I was ENcouraged by the approval of the stimulus 6 weeks ago, I am now DIScouraged by the very uneven and even capricious way it has been doled out.  Notice how few earnings reports have companies saying they got aid from the Government.  Where did the money go?  How many small business owners do you know who got the loans they were promised?

We get the Non-Farm Payroll Report on Friday and it will show MILLIONS of people lost their jobs in April, most likely we are past 22M unemployed and almost no way to stop the number from hitting 30M – 20% of the US work-force out of a job.  States are running out of Unemployment Funds and GOP Governors don't want to use that money for the same reason Trump wants to keep his – so they are all doing what they can to push their citizens back to work and, if hundreds of thousands of them die – let them eat cake!

We've already had more American deaths from the virus than the entire Vietnam War, we lost 405,000 Americans in World War II and 620,000 in the Civil War and, sadly, neither of those "goals" are out of Trump's reach.  MAYBE things will go well and not that many people will die and Trump will get to say "I told you so".

Maybe it won't and maybe you'll die or I'll die or our children will die – none of that seems very real with "just" 70,500 people dead out of 330M but "only" 1.2M of us have been infected so far and, of that group, we've only seen 250,000 outcomes, 25% of which were death so pretty good odds you will live – at the moment.

But those odds are a lot worse than they were a month ago, when 1/4 as many people were infected.

Be careful out there! 

 


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  1. Good morning, All!

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

    https://attendee.gotowebinar.com/register/5964748732828255248


  2. Good Morning.



  3. Good morning!

    Still holding those 50 dmas so I haven't pulled the trigger yet on cutting back but I think it needs to be done as we have NFP on Friday, which is a potential shocker and I haven't seen much good news this week and Trump heading back into purse fantasy and winding down the task force and shaming states into opening and encouraging armed protests against state governments…. do I have to go on???


  4. Phil/economy

    thanks for the morning post. I have always wondered how long it takes you to research and write these and where you find the time! Much appeeciated!

    so far, since March 23, I have been wrong in market direction. So, I don't give nay advice about markets.

    having said that, it seems to me that the stimulus and its amelioration of the COVID effect, is not going to be enough to move the money around. Yes, we are buying groceries, and watching Netflix etc.. The discretionary spending may be gone to a large extent. Unemployed people, even those getting checks from the Govt., are less likely to go out and shop (even when we do open, what with the hassles of wearing mask, having to distance etc) than they were while employed. The owners of businesses are foregoing;g some of their profits, income and some not taking salaries etc…

    All this sets up for a very sluggish money movement over the next few months, possibly longer. There was news yesterday from Stanford that there may be viral mutation already. What effect does that have on a vaccine?

    Bottom line, I am trying to bring myself to buy this market, but cannot seem to.


  5. Another big build in oil:

    • EIA Petroleum Inventories: Crude +4.6M barrels vs. +7.8M consensus, +9.0M last week.
    • Gasoline -3.2M barrels vs. +0.1M consensus, -3.7M last week.
    • Distillates +9.5M barrels vs. +2.9M consensus, +5.1M last week.
    • Futures (CL1:COM -2.6%)

    Analysts cautious as Beyond Meat soars

    • Beyond Meat (BYND +19.1%) shoots higher after investors latch on to the plant-based meat producer's 141% Q1 revenue growth and surprise profit.
    • Oppenheimer analyst Brian Bittner (Perform): "We overall look very favorably upon the Q1 delivery from BYND even with intense foodservice headwinds. Q1 adjusted EBITDA of $12.7M easily topped a Street figure of $1.6M driven by well-above-plan gross margins, which in our view is a positive indicator of the longer-term profit potential of the model and strength of BYND’s competitive position. Given the Q1 positives, the more difficult foodservice conditions post Q1 coupled with a now elevated valuation keep us sidelined. Two of our favorite growth stories in our universe including BYND and FRPT are both benefiting from significant scarcity value within the consumer staples universe, but valuations are difficult to justify for both names at current levels, in our view."
    • UBS analyst Steven Strycula (Sell rating): "We expect traffic trends to trough in Q2 as mobility restrictions peak, but we anticipate a gradual recovery in restaurant traffic, particularly at independents. In the current environment restaurants are placing increased menu emphasis on 'value items' and are hesitant to onboard new menu items at this time. Following BYND's call we reduce our Q2 and FY20 foodservice sales trends to +4% YoY and +28% YoY."
    • Bank of America (Underperform): "We raise our FY20, FY21 and FY22 sales estimates to $497m, $723m and $1,020m driven by strength in retail and the addition of the Starbucks partnerships. We raise our PO from $58 to $68 which is still based on a FY21E EV/Sales multiple of 6.0x. However we reiterate our Underperform based on our view that BYND’s significant exposure to the foodservice sector (51% of 2019 sales) and premium valuation multiple (7.0x CY20E EV/Sales) position the company to underperform food/beverage peers."
    • Previously: Beyond Meat +3% after surprise profit (May 5)
    • Bank of America (BAC -0.4%) is starting to see consumer spending recover, CEO Brian Moynihan said in a phone interview on Fox Business's "Mornings with Maria."
    • In the last two or three weeks, "spending started to grow" on both the merchant side and the consumer side, he said.
    • "You’re starting to see these stimulus programs actually get deployed and in people’s pockets," he said.
    • Looking at credit card data, consumers are starting to buy more gas as people start to drive more and they're spending more at restaurants.
    • "You’re seeing restaurants grow almost, you know, double-digits in terms of activity," as restaurants other than quick-service adapt their business models, Moynihan said.
    • He expects that BofA's 2020 expenses will be at the ~$53.5B guidance it had provided.
    • As for the economy's recovery, Moynihan points out that this is a health crisis and there will be "ebbs and flows" of that crisis — and readjusting of business plans — until there's a vaccine.
    • Even with near zero interest rates until 2023, he said BofA can continue to provide adequate returns for shareholders, as it did in the low-interest years after the financial crisis.
    • "So, it will be less earnings, but on the other hand, you know, the amount of capital we generate and the capabilities we have will provide adequate returns for shareholders," he said.
    • CFRA analyst Tuna Amobi keeps a Sell rating on Norwegian Cruise Line Holdings (NCLH +4.2%) after factoring in the company's flurry of capital raises.
    • "Somewhat ominously, NCLH also alluded to 'substantial doubt' amid some lingering liquidity and/or financing challenges, which seems like a tacit acknowledgment that a potential bankruptcy filing could be on the table," he notes.
    • Amobi reminds that the company fully drew on a $1.55B credit revolver, raising its debt to $8.6B. "Having earlier withdrawn its '20 financial targets, NCLH recently said its advance bookings for the remainder of '20 were meaningfully lower (vs. '19), with '21 essentially flat (vs. '19) at pricing that is down mid-single digits, we think underscoring a likely uphill task ahead," he adds.
    • A dedicated team of scientists, engineers, and employees at SolarWindow Technologies (OTCPK:WNDW +43%) have built the company's largest-ever transparent electricity-generating window array despite the unprecedented COVID-19 pandemic.
    • In the coming weeks, SolarWindow plans to unveil the array so that stockholders, supporters and other stakeholders are apprised of the development.
    • OpenTable numbers in March provided the early call about the plunge in restaurant seating demand well before governments nationwide instituted economic shutdowns.
    • So recent data from the company (h/t Carl Quintanilla) are worth a look. They show year-over-year seating demand going from a steady stream of -100% throughout April to -99% on May 1, and then -98% on Monday.
    • Susquehanna keeps a Positive rating on Skechers (SKX -0.3%).
    • "After hosting investor meetings with CFO John Vandemore, we believe it is clear that SKX will emerge from the current crisis in a position of strength," updates Sam Poser.
    • "Compelling and accessibly priced product, a burgeoning e-commerce business, and ample liquidity will all help SKX weather the current crisis better than most peers, in our view," he adds.
    • The also notes that the crisis has led SKX to closely examine potential cost-savings initiatives to reduce SG&A over the long-term.
    • Poser says retail recovery in China continues to take shape, which is a positive sign for other regions such as the U.S. that are in the earlier stages of the pandemic.
    • A survey conducted by Gordon Haskett shows that U.S. consumers may have peaked on the fear front, although high-traffic areas are still likely to be averted without an effective COVID-19 vaccine which is likely to slow a recovery.
    • Without a vaccine, consumers indicated they would feel more safe to visit in a month restaurants (48% yes), off-mall stores (44%) and malls (43%) than gym/fitness clubs (37%), planes (28%), bars/clubs (28%), sports stadiums (25%) and cruise ships (23%). Even with a vaccine, only 38% of respondents said they would take a cruise.
    • Another interesting pullout from the Gordon Haskett survey is that Target (NYSE:TGT), eBay (NASDAQ:EBAY) and Kroger (NYSE:KR) are gaining traction in being the "retailer of choice" for online shoppers. Amazon (NASDAQ:AMZN) is still the top pick, but has fallen off over the month as shoppers have used other sources. Walmart (NYSE:WMT) is second and is gaining some traction.
    • Gordon Haskett analyst Chuck Grom also broke down the online grocery war between Walmart, Target, Kroger (KR) and Costco (NASDAQ:COST) based off the firm's survey. "On an individual retailer basis, Walmart saw a significant drop in people using online grocery pickup or delivery, decreasing 1,500 basis points to 38.4%, while TGT rose 650 basis points to 14.0%. Meanwhile, Kroger increased 620 basis points to 11.0% and COST increased 320 basis points to 7.3%," notes Grom.
    • Related stocks: Carnival (NYSE:CCL), Royal Caribbean (NYSE:RCL), Norwegian Cruise Line Holdings (NYSE:NCLH), Planet Fitness (NYSE:PLNT), Macy's (NYSE:M).
    • The White House coronavirus task force will "continue indefinitely," President Trump said via Twitter, adding that he may "add or subtract people to it, as appropriate."
    • The task force's focus will be on "SAFETY & OPENING UP OUR COUNTRY AGAIN."
    • It will also be "very focused" on vaccines and therapeutics, Trump said.
    • In a new regulatory filing, Uber (NYSE:UBER) says it will cut 3,700 jobs from its customer support and recruiting teams due to the lower trip volume in the Rides segment.
    • The cut represents about 14% of Uber's 26,900 employees.
    • Uber expects to incur $20M related to severance and other termination benefits.
    • CEO Dara Khosrowshahi agrees to waive his base salary for the remainder of 2020.
    • Uber shares are down 1.6% pre-market to $27.60.
    • SmileDirectClub (NASDAQ:SDC) inks agreements with UnitedHealthCare (NYSE:UNH), Aetna (NYSE:CVS) and Anthem Blue Cross Blue Shield (NYSE:ANTM) (starting this month) enabling in-network access to its clear aligner treatments via telehealth.
    • Payment levels are not disclosed.
    • Shares up 10% premarket on average volume.

     

    • It wasn't such a fun quarter for Cedar Fair (NYSE:FUN) with theme parks closed after March 14.
    • Cedar Fair was having a strong start to the quarter with attendance up 19% before the stay-at-home orders went into effect.
    • In spite of the disruption caused by COVID-19, the company's season pass sales remained up more than 30% at the end of Q1.
    • Cedar Fair estimates a cash burn rate of $30M to $40M a month with parks closed. Should parks remain closed for an extended period of time, the company is prepared to activate additional cost-cutting and cash-savings measures to further reduce its cash burn rate.
    • Shares of FUN are down 0.28% premarket to $26.79.
    • Previously: Cedar Fair EPS misses by $2.14, beats on revenue (May 6)
    • Cars.com (NYSE:CARS) soars after reporting Q1 adjusted EBITDA ahead of expectations ($35.2M vs. $30.3M consensus). Adjusted EBITDA was 24% of revenue vs. 25% a year ago, despite fewer dealer customers and lower ARPD than in the prior year.
    • Business update: "Prior to the COVID-19 impact, the company believed that it was in a position to deliver a robust second half of the year and to exit the year with revenue and Adjusted EBITDA growth. The effects of the COVID-19 pandemic restrictions have and will negatively impact results of operations, cash flow and financial position."
    • CARS +19.25% premarket to $5.39.
    • Previously: Cars.com EPS beats by $0.24, beats on revenue (May 6)
    • April ADP Jobs Report: -20.2M vs. -20M consensus, -149K prior (revised from -27K).
    • The report utilizes data only through April 12, says ADP, and does not reflect full impact of COVID-19 on the employment situation. Indeed. In the first two weeks after April 12, another 8.3M filed for first-time unemployment, with another 3M expected to be seen in this week's report.
    • The ADP's Ahu Yildirmaz: "Job losses of this scale are unprecedented," with April's decline alone more than double total numbers lost during the Great Recession.
    • The service sector was hit hardest with 16M job loss (leisure/hospitality -8.6M), while the manufacturing sector lost 4.3M.
    • Small businesses lost 6M jobs, including 3.36M for those with 1-19 employees, and 2.6M for those with 20-49 employees.
    • A couple of subsectors posted modest job gains in April – Education up 28K and Management of companies/enterprises up 6K.
    • The government's nonfarm payroll data is due on Friday morning, with economists expecting a job loss of 21.5M and the unemployment rate seen rising to 16%.

    - 20M?  So what?  


  6. How long/Maya – Well I'm reading and on the phone all day and then I think about the most important thing going on and write about that in the morning.  There's a fine balance between stimulus (what's actually been deployed) and the danger of the virus and the actual impact of 250,000 dead, 1M dead or 2M dead vs staying shut down and, at the moment, I think the danger of CLEAR data that says easing the lockdown has been a mistake is the worst thing that can happen – but that will take 2 weeks and then probably 2 weeks of arguments – no matter how clear the data is to rational people.  

    Saying you are going to develop a vaccine at "Warp Speed" is from fantasy-land.  Yes, you can skimp on the testing and the studies and just throw out something that might work – but then that's not a vaccine any more than injecting bleach is a vaccine, is it?  Vaccine implies safety and effectiveness and THAT is what 6 months of testing is for.  It's so funny that the anti-vaccer like Trump wants to skip all that and get it straight into people's veins.  He might WANT it to fail so it can feed the anti-vax conspiracies for years to come.

    Yes the economy will be sluggish but $2.7Tn makes up for 6 months of sluggish.  The only issue is it's not being evenly distributed but that's not an issue if your goal is to make money on stocks – where a lot of the money is ending up.  Viruses always mutate – the question is how.  It could mutate beneficially as the mild version of the virus is able to reproduce much more rapidly than the harsh version so the "mutation" may be a long-term transmissable but far less severe version.  The reason we've been able to share the earth with viruses for 65M years is because they adapt to optimize their spread – which generally avoids killing the hosts.  

    That's why we are in detente with the flu virus.  It tends to get just strong enough that not everyone gets a vaccine and that's because it doesn't bother many of us enough to bother getting a shot to prevent it.  If it gets too strong, we try to eradicate it and those strains fail to gain traction while the milder strains are free to multiply and spread and boost tissue sales every season.  

    The bottom line though is that we simply don't have enough information to make a rationale investing decision so CASH!!! is the best bet but, realistically, none of us really want to go to cash because it's too boring – so we play and that then leads us to hope for the best.  Which is why I keep having to point out the worst – it's easy to forget what one wrong turn can lead us to.

    As they seek a path forward, governments around the world must triangulate the health of their citizens, the freedoms of their population, and economic constraints. Could schools be reopened? Restaurants? Bars? Can people go back to their offices? “How to relax the lockdown is not something around which there is a scientific consensus,” says Caroline Buckee, an epidemiologist at HSPH. Most researchers agree that reopening society will be a long haul, marked by trial and error. “It’s going to have to be something that we’re going to have to take baby steps with,” says Megan Coffee, an infectious disease researcher at New York University.

     

    The number to watch in the next phase may no longer be the actual number of cases per day, but what epidemiologists call the effective reproduction number, or R, which denotes how many people the average infected person infects in turn. If R is above 1, the outbreak grows; below 1 it shrinks. The goal of the current lockdowns is to push R well below 1. Once the pandemic is tamed, countries can try to loosen restrictions while keeping R hovering around 1, when each infected person on average infects one other person, keeping the number of new cases steady.

    To regulate R, “Governments will have to realize that there are basically three control knobs on the dashboard,” says Gabriel Leung, a modeler at the University of Hong Kong: isolating patients and tracing their contacts, border restrictions, and social distancing.

    Those "baby steps" led to 500 people lined up for Mexican Food yesterday at my local restaurant.

    The Ratchet Hatchet - Home | Facebook 


  7. ahhh GBTC my love. Sold you too soon. Off to the races on bitcoin halving


  8. Coronavirus tracked: Has your country’s epidemic peaked?




  9. DIA Jun 290 calls @ 3 cents.

    This is a why not play. News of a cure and we're at Dow 30,000. And I can safely enter puts in the meantime.



  10. Cure/BDC – okay, why not, indeed…..but……no pandemic, epidemic, outbreak that I'm aware of has ever been stopped by a cure or vaccine. Prevented, yes. Stopped in mid-course, no. This includes even the great bacterial plagues, cholera, tuberculosis, bubonic plague. Those were stopped by infrastructure changes, not by cures or vaccines.

    So, maybe it'll happen this time – but it'd be a first.


  11. OXY is down 10%. This is the normalcy I expect in the market returning. Finally.


  12. I said news of a cure. Not a cure. I need 20% by mid June, which could happen based on a number of factors, such as money printing, alone. So I really need the news. It's a $105 bet. I'm not making any historical representation whatsoever. I think this just gives you a soap box chance to espouse a firmly held opinions for which you seem to be quite ruffled about despite them being unchallenged. Investing looks forward, not in arrears, and makes bets based on PROBABILITY, not on binary YES/NO, which is, obviously, idiotic. A cure is not PROBABLE, it is, however, possible. Human progress seems to march forward as well. For example, those driving horse buggies never pictured a car or an airplane.

    Yersinia pestis can be cured by the way.


  13. Cures/BDC……this has the ring of ad hominem about it, but whatever, I'm old, I don't care. You missed my point, though, if you think "Yersinia pestis can be cured by the way." contradicts what I said. Nice way to show off a little medical knowledge, though, so props for that.


  14. Thanks for the webinar, Phil!


  15. not quite, I had to wiki it


  16. ad hominen – this one's got to be my favorite. 7.7B people on the world, statistically speaking, none of which I talk to (accurate to within 0.00001%).  Then when people on FB or on message boards or wherever complain about personalization and how that's not somehow the point. THAT IS EXACTLY WRONG. IT IS EXACTLY THE POINT.


  17. Yuch, not good market moves. 

    Nas is still up.  

    Cure/BDC – In the next 30 days?

    First time/Snow – We do have gene-sequencing now so it is possible.  Some CRSP solution seems promising.

    Could Crispr Be Humanity's Next Virus Killer? | WIRED

     

    https://www.clinicalomics.com/topics/patient-care/therapeutics/new-crispr-cas13-approach-inhibits-sars-cov-2-virus/

     

    Also a test in the offing:

     

    NPR
    Researchers Hope New CRISPR Technique Could Speed Up …
    They worked on the chemistry, and tweaked their CRISPR system until they could run the test in three simple steps. First, extract the viral …

    Your welcome 1020.  Very exhausting to talk for 2 hours.  

    OK, it's official, we are pulling the plug on these positions (not DIS):

    Well, to some extent, we're closing well today (so far) so the gains are a bit of a buffer and we do have new hedges but these are the positions I'm strongly considering killing as they are too risky:

    LTP:

    • THC – I'm not sure hospitals are making money as they have to turn the entire place into biohazard wards and they can't do profitable surgical work.  It will come back one day but not sure when.  
    • ALK – Can't see risking an airline stock without more clarity – this one is certainly going.
    • DFS – I'm a bit worried on defaults and such.  Need to do more research.
    • FCX – Infrastructure looks far down the list.  
    • IMAX – If they had longer options maybe, but not worth it with short-term. I'd rather buy more DIS but I'm worried about them too if they lose the summer. 
    • LB – With the deal off the table I think maybe we don't risk it.
    • VALE – Same as FCX, may never be infrastructure.

    Dividend Portfolio:

    • TD – We got out on LTP, need to dump these too.
    • NLY – Might take longer than we want to wait to turn around. 

    Future is Now:

    We made no changes and we're up 7% for the week!

    Money Talk - I'm on Wednesday but taping Monday so:

    • FCX – Same reason 
    • IMAX – Same reason

    Butterfly Portfolio: 

    • X – Another one I'm not sure the infrastructure will come but so cheap it's hard to ditch.  

    Earnings Portfolio:

    • CLF – Infrastructure again
    • HRB – We're at the money but I'm not comfortable with them.
    • IMAX – Same problem

  18. "pulling the plug"   agreed. Nothing on that list I cant part with


  19. Ugly finish – must be all of us selling…  cool


  20. naked short DIS


  21. Ugly finish might be used for a lot of stuff in the coming months! 


  22. that wasn't ugly at all. Any day this market doesn't start flipping breakers is a gift. We should be at DOW 12,000 just based on any one indicator out there, let alone all of them. Take unemployment. What is it now, 20M? 30M?


  23. First time /Phil – Could be, that makes sense. That would be terrific, and BDC would make boatloads of money (best to you, mate)


  24. I think this might be the biotech revolution we've been predicting of yore, finally coming to fruition. I just saw a headline about but can't find the article


  25. Ciclesonide


  26. The Bug – this latest Atlantic article describes a way out, even this late in the game. I doubt we'll do it, but this demonstrably worked: https://medium.com/the-atlantic/whats-behind-south-korea-s-covid-19-exceptionalism-a6051d26348


  27. It’s encouraging to know that something works. 




  28. The Virus Is Winning



  29. California to get $247M refund as masks face delivery delay


  30. meanwhile in the US Trump said the virus would "miraculously" disappear. 


  31. Like many of you, I do not trust this market.  There are too many variables right now—positive and negative.  We keep reading about the different schools of thought as to the type of recovery this will be, with “V” and “U” being the most prevalent.  And while I’m definitely not qualified to prognosticate about the market—Phil and many of you are far more qualified—I’ve been wondering, what if this is going to be more like a “W” recovery?  Or even multiple W’s?  The market priced in the 1Q20 & 2Q20 damage and is now anticipating we will be back to normal fairly quickly (and as Phil continually does the math for us, this rationale makes sense—especially with the multiple forms of stimuli being approved and/or considered, even if the distribution/roll-out of that stimulus has been/continues to be a mess).  But what if the vaccine or effective treatment doesn’t come in the next 12 months, like we’re all hoping?  And then we do see that second (and even a third?) wave later this year and into 2021?  Or if we do find effective an treatment/vaccine, how quickly will production be ramped up to meet the demand?  We’re more than two months into this pandemic, and we’re still struggling to get masks, shields, gowns and test kits to hospitals around the country—this doesn’t bode well for the 300 million+ vaccines that will be needed if/when one is developed—and that doesn’t include the demand from the other 7 billion people in the world (ok…maybe we’ll only need 200 million vaccines in the US when you consider the anti-vaxxers and the Trump cult members that will refuse the vaccine.  Only joking.  Kind of.)  So while we see economic improvement in 3Q20, what if 4Q20 looks like 2Q, followed by an improvement in 1Q21, and so on?  Just throwing the “W” scenario out there for debate and pontificating by those of you much smarter than me—as we all continue to try to make sense of what’s happening and how to invest in this manic market.






  32. Trump economy faces long-term disaster as jobs data looms


  33. AP Exclusive: Admin shelves CDC guide to reopening country