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Faltering Friday – Low-Volume Rally Sputters into the Weekend

Here's the weekly S&P 500 ETF (SPY) Volume Chart since we topped out at S&P 3,390 back in February:

Date Open High Low Close* Adj Close** Volume
May 28, 2020 304.65 306.84 302.24 303.07 303.07 90,767,807
May 25, 2020 301.93 306.84 295.46 302.97 302.97 284,174,000
May 18, 2020 293.05 297.87 291.95 295.44 295.44 443,623,300
May 11, 2020 290.34 294.24 272.99 286.28 286.28 552,746,300
May 04, 2020 280.74 292.95 279.13 292.44 292.44 385,948,200
Apr 27, 2020 285.12 294.88 281.52 282.79 282.79 548,933,400
Apr 20, 2020 282.61 286.79 272.02 282.97 282.97 509,895,300
Apr 13, 2020 277.14 287.30 271.41 286.64 286.64 649,240,600
Apr 06, 2020 257.84 281.20 248.17 278.20 278.20 733,545,600
Mar 30, 2020 255.70 263.33 243.90 248.19 248.19 869,026,800
Mar 23, 2020 228.19 262.80 218.26 253.42 253.42 1,342,924,000
Mar 20, 2020 1.406 Dividend
Mar 16, 2020 241.18 256.90 228.02 228.80 227.46 1,523,388,400
Mar 09, 2020 275.30 288.52 247.68 269.32 267.75 1,562,964,500
Mar 02, 2020 298.21 313.84 290.23 297.46 295.72 1,130,490,100
Feb 24, 2020 323.14 333.56 285.54 296.26 294.53 1,243,284,200
Feb 17, 2020 336.51 339.08 332.58 333.48 331.53 293,992,500
Feb 10, 2020 331.23 338.12 331.19 337.60 335.63 260,011,300

This week is not over but we're trending tthe same, lame 500 Million(ish) volume we have since we bottomed and it's not a good thing for there to be heavy, heavy selling followed by weak buying.  Let's say we're bulding a house of cards and our first attempt had all 52 cards in a deck holding it up and it got all the way to 3,390 but then it got knocked down by a virus so we rebuild it and we get all the way back to 3,040 – but we only used 26 cards

Magic Cards GIF - Magic Cards House - Discover & Share GIFsIs the 2nd house of cards we built likely to be stronger than the first or is it going to be much more flimsy and ready to collapse at the slightest breeze?  THAT is the market we have bought ourselves with this very speedy and sloppy recovery in which we re-captured the HEIGHT of the previous rally – but without building any kind of base to support it.

Remember, the market is an auction and the price of the last share of stock sold at the bell determines the IMPLIED value of ALL the other shares of stock – no matter how ridiculous that last price paid happens to be.  If, right at the close, I pay $350 for the last share of Apple (AAPL) then AAPL will carry a $350 price tag overnight and I will have added $120Bn worth of  IMPLIED "value" to the company by spending $350 on the last share of stock.  

We've seen this happen plenty of times as stocks fly up at the close or overnight, only to be sold right back down  the next day and it works the other way as well.  This goes to that great market axiom that you can fool some of the traders all of the time but not all of the investors all of the time – that's why the 50-day moving averages are more volatile than the 200-day moving averages – there is some wisdom to the larger crowds. 

As I pointed out to our Members this week we have to consider, in the bigger picture, that the over-reaction to the virus was a blip in the long-term picture and should simply be ignored but what is very real is the 5% Rule, which tells us we've completed our run from S&P 1,600 to S&P 3,200 and, even in the most bullish conditions (and these may be with all this liquidity added) we can still expect to consolidate for quite a while (maybe years) before heading any higher.

Very simply, all that's happened recently is that we've had a 20% retrace of a 100% run in the market over the past decade and that certainly makes sense since the Global GDP in 2007 was $58Tn and in 2000 it was 33Tn and clearly S&P 1,600 was not sustainable then but $58Tn did turn out to be enough to support it and, in 2013, the Global GDP was up to $77Tn – up 33% from 2007 and THAT was finally enough to send us up to the next level.

Iran ranks 27th among world's biggest economies: WB - Tehran TimesThat means, $58Tn is to low to justify 1,600 and $77Tn is too much and they are only 19 points apart so let's say $67Tn is certainly enough to justify 1,600 and higher on the S&P 500.  That means we'd want to see $134Bn in Global GDP to justify a sustained move in Global Equities to 3,200 and above.  Sadly, the current Global GDP is $87Tn as of last year and likely to be LOWER in 2020 and not likely to hit $134Bn until the end of this decade.

There are other factors like weaker currencies making stocks more expensive and lower taxes making the earnings more valuable – both of those have come into play but not enough so that they justify paying S&P 3,200 for $87Tn in GDP – that's simply an indicator that the market is grossly overpriced.  

Is everything overpriced?  Of course not, our portfolios are filled with bargain stocks that we think will do very well over the next decade as the S&P grows into it's valuation but it is very much a stock-picker's market and the indexes are still houses of cards at these levels – very easy to blow over in a crisis.

Today our crisis will be Trump placing new sanctions on China and next week the crisis will be 40M Americans out of work and, so far, there's no real plan to deal with that.  

We can pretend the Nasdaq is a different animal and not bound by such issues as the Global Economy determining it's value but the S&P 500 IS the Global Economy and, eventually, tends to reflect that reality.  As such, in our Short-Term Portfolio (which hedges our long portfolios) we recently added 100 Jan $20/30 bull call spreads at net $2 and they are now net $1.46 – so an even better deal now but we're going to make some adjustments into the weekend uncertainty to lock in the ridiculous gains we've made over the past two weeks on our longs:

  • Sugar ETF (CANE) – Sugar took another turn down this week but we expect it to pop into the summer.  This is a small, speculative bet.  
  • Nasdaq Ultra-Short ETF (SQQQ) #1 – We are just waiting for those short June calls to expire.  
  • Apple (AAPL) – We sell short puts to offset the cost of our hedges.  Not worried about these as our worst-case is being "forced" to by 700 shares of AAPL at net $150.  PLEASE!!!  Meanwhile, we put $7,000 in our pocket for promising to buy them – isn't that crazy?  

  • JP Morgan (JPM) – Here we collected $4,250 for promising to buy JPM for net $41.50 – also more than 50% off the current price.  These are the kinds of things you can do all day with your sideline buying power.
  • S&P Ultra-Short (SDS) – Here we have 2 hedges and SDS is now $20.77 and it's a 2x ETF so, if the S&P drops 20%, SDS will go up 40% to $28(ish) so the $20/30 bull call spread is a good range.  The spread has gotten a lot cheaper since we initiated and the range is still good so let's double down on the $20/30 spread to add another $100,000 worth of protection for net $14,600 – I'd say that's a good insurance play!  That will give us $300,000 worth of protection at $30 against our current net (including the new $14,600) of 51,400 for a net $248,600 total hedge.

  • Chipolte (CMG) – Right in the center of our range and this spread is very profitable already.
  • Nasdaq Ultra-Short (SQQQ) – The problem here is that SQQQ is so low now ($9.83) that, even though it's a 3x gainer, +60% is only $15.71.  That is the range we are covering so this hedge is fine but, at net $2.75, it's not even a double so SDS is clearly a better hedge at the moment.  Still it's a $200,000 spread currently valued at net $40,600 so $159,600 worth of protection.

  • Nasdaq Ultra-Long (TQQQ) – Since we weren't happy with the pay-off potential of SQQQ anymore, we switched to shorting TQQQ instead.  TQQQ at $80 can fall 60% on a 20% dip in the Nasdaq (see the March collapse) and that would take it down to $32 which would put the $80/55 bear put spred well in the money.  We paid net $38,350 for the $125,000 spread which gives us $86,650 in protection and, so far, we've collected $3,850 in profits not because the Nasdaq went lower but because we sold an insane amount of premium to suckers who pay it instead of selling it!  

  • Tesla (TSLA) – Right on the button so far and I want to buy back the short June $800 puts as we're up 71.6% with 3 weeks left to go and I think that, now that Musk has qualified for his bonus, the extreme measures he's taken to prop up the stock all month may start to wear thin.  That turns us very bearish in TSLA but it's a small unit bet. 

  • Natural Gas ETF (UNG) – We cashed out our oil play last week and UNG is in trouble but I don't think this will last so we'll take advantage of this down move and make adjustments:  The 20 Jan $15 puts at $4.70 ($9,400) can be rolled to 30 of the 2022 $12 puts at $3.50 ($10,500) and the 2022 $12 calls at $2.84 ($14,200) can be rolled to the $8 calls at $4.25 ($21,250) and we'll buy back the 40 short Jan $15 calls at $1.10 ($4,400) and wait for a bounce to sell more.  So, on the whole, we're spending net $12,550 to roll our 50 longs $4 deeper in the money ($20,000) but UNG is only at $11 so call it $15,000 in the money for $12,550 – NOT making those kinds of adjustments is a poor way to manage your positions! 

On the whole, we have $494,850 worth of protection against another 20% S&P 500 drop and I will remind you that this is how we made $460,870 this year already so I think it's a great plan and we have our fun plays in this portfolio and our long plays in other portfolios to help offset any losses we may have in this set of hedges.  Oh yes, and we also have $370,402 in CASH!!!   

I feel good about the weekend now. 

Have a great one, 

- Phil

 


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  1. I really have trouble finding the energy to worry about the markets at this moment! Trump's America is a sinking ship – morally, financially, legally! He is tearing at every corner of the fabric of our country, pouring gasoline on the fire while fiddling on Twitter!

    Biden should run on the slogan to "Make America Great Again"! Seems more appropriate today than in 2016.


  2. Nice movement on NAK overnight. 


  3. the only thing trump hasn't done yet to distact America from things that matter like the virus is find a way to have the world living under immanent threat of nuclear war. Some people will do anything to get ahead. very sad


  4. Good Morning.


  5. Good morning Phil,

    FNV – I have the following 2022 vertical spread

    Bought 5 * 105 @18.91, sold 5 * 120 @ 12.76 (6.15) currently respectively  49.80/40.45 (9.35)

    What should I do just leave it alone and wait or can I generate some more out of it, selling short term calls or roll ?

    Thanks in advance!

     


  6. stjean – While things are bad, for many, having a black president was much worse…. :(

     

    Let's leave that maga slogan in the past.



  7. Good morning!

    See the STP adjustments above!


  8. don't see any STP Adjusts


  9. Sorry, needed to refresh


  10. Big Chart – Today could be day 2 of holding 3,000 on /ES but not off to a good start this morning.

    That's a nasty rate of decline from 3,060 before yesterday's close – less than 3 market hours to drop 45 points so far!

    Now that we have $500,000 worth of protection in the STP, I don't feel compelled to make Futures bets.  Earlier this week we were less hedged in the STP, so supplementing with Futures was a higher percentage play than it is now, when Futures bets would be redundant.  I'd rather find a bullish bounce line to play now to protect the hedges – though I'm certainly not feeling it.  Maybe the 3,000 line if we hit it.  

    Energy/StJ – I know!  Now he's starting a Cold War with China and moving against TWTR and FB (already attacking Bezos and the rest of the media) and, of course, the virus is raging out of control while the Administration denies the facts and puts ALL of the American people in harm's way.  I find it very hard to reassure my children these days…  

    NAK/Ati – At least we can feel good about Trump F'ing over the Envrionment! 

    At least this will make my kids feel better (I buy the penny stocks for their accounts):

    Northern Dynasty: EPA expresses confidence in Pebble permitting; opts not to elevate approval decision

    Trump's Dirty Deed: Latest EPA Deregulation Will Kill Americans ...

    Talk about a long-term patience play! 

    Submitted on 2011/01/13 at 10:28 am

    NAK/Aug – Oh no, I’m done with them now.  I LOVED them at $2, I loved them at $6 and I liked them at $8 but, at $17 – not so much….  

    NAK/Amatta – I like them so I wouldn’t want to short them but I wouldn’t buy them up here either.

    Submitted on 2011/03/10 at 3:55 pm

    NAK/Rain – We were done ages ago but now maybe a new entry coming up.  They are still good long term but they don’t make any money and won’t make any money for years – kind of like owning a biotech.  

    Submitted on 2012/05/10 at 3:02 pm

    NAK/Terra – The preliminary results of their environmental impact study did not look good so people are bailing.  This is around the price I usually do like them but I still think gold is going off a cliff and China has all that copper to dump so not a good part of the cycle for speculative NAK.  If the project ends up being a no-go – these guys are BK – they bet everything on it – I'd rather catch them when they cross back over $6 again or maybe speculate if they go to $2 but now it's like picking a biotech and waiting for FDA approval. 

    Submitted on 2012/12/28 at 2:18 pm

    NAK/Scott – Whatever entry you make, plan to buy more at 1/2 price and you'll be happy.  It's such a long-term project bogged down in so many environmental issues – it's like riding a roller-coaster.  

    Submitted on 2013/04/10 at 2:58 am

    NAK/MrM – They are already priced like it won't be approved but it will be eventually.  

    "Senator Cantwell's concerns have no basis in fact," said Ron Thiessen, President & CEO of Northern Dynasty. "While the EPA may have used some of the information presented in our Preliminary Economic Assessment to create a 'hypothetical mining scenario', it is the EPA alone that is responsible for designing and then assessing the effects of the hypothetical mine in the BBWA. To suggest that Northern Dynasty is responsible for the EPA's hypothetical project which was evaluated in the EPA's draft BBWA when we had no involvement with the report is wrong."

    You are right to view it as a "binary play" – like a lot of biotechs, it will ultimately be approved or it won't but, if not, maybe you lose $2.83 (BK) but, if approved – you could have a 10-bagger so not a terrible place to put some play money.  I haven't advocated NAK since it was below $2 in 2009, when I was banging the table on them, but they ran up to $20 in 2011 and I lost interest since but now, back around $2 – it's interesting again.

    Also, if you want to get an idea of the real odds – Nov $2 puts are .20 but Nov $4 calls are .30 – so more people on the call side willing to pay up.  This will drag on for years though so I wouldn't pay premium for the calls – it's pure speculation to accumulate on dips and lighten up when they pop on rumors and then accumulate again on the next dip.  Most likely, like Biotechs – it will dive and flush before a real move up so it's important to always be 50% cash in this position and always scale in and out of the rest – scalp enough quarters and the stock is free after a while.  

    NAK/StJ – Can't make money when all they do is fight red tape all day (gosh I sound like a Conservative!).  They are the biotech of miners – working and working and working on a very promising hole in the ground that, if they ever get EPA (rather than FDA) approval, can be worth Billions in sales.  Meanwhile, they burn about $500K per month doing their R&D.  

    Submitted on 2013/09/16 at 3:31 pm

    NAK/Dennis – I would take 75% off because, if you bought 1,000 at $1.35 ($1,350) and you sell 750 for $1.49 ($1,117.50) you end up with 250 at $232.50 or about $1 per share and you can put a stop at $1.25 and not even think about it again as a long-term trade.  I do like them but 10% in a day is very lucky (see above conversation with Albo). 

    NAK/Scott – Yes, I am torn on that because I do like salmon.  This is what keeps NAK down but, if they ever are approved – 10-bagger would be just the start.  

    Submitted on 2013/11/15 at 10:11 am

    NAK/Invest – It's a speculative play.  The idea is simply to get a good entry and cross your fingers that they go up 10x before they go down 90%.  If you are looking for a quick pay-off, forget it – this thing is years away from resolution,  although they may be punctuated by bouts of optimistic investors as they make progress.  The current short $2 puts are .68 and the May short $2 puts .85 and, if you can whittle away .17 every 6 months, the stock will be free in 5 years…

    NAK/Scott – Yes, I see it as cheap enough to hold until it pops and then get at least half out.  Not as my stock of the decade!  

    Submitted on 2013/12/13 at 4:28 pm

    NAK/MrM – I told you, it's a lottery ticket.  Gotta be in it to win it.  

    NAK/MrM – Yep, it's an insane stock, best to put $5,000 in in and leave it for 10 years and you'll either have $50,000 or you won't.  Not much different than a biotech – they might have something very valuable – or they might not – in between there will be many rumors in both directions.  

    NAK/Invest – Another one I get bored banging the table on but I love them at $1.36 – very speculative, of course.  You can buy the stock and sell the Aug $2 call for .20 and the Aug $2 puts for .90 so your net is 0.26/$1.13 and the $2 puts + owning the stock means you break even at $1.13 in Aug, which is a nice 14% advantage to just buying the stock.  

    Submitted on 2014/02/11 at 3:48 pm

    NAK/Vedan – They are speculative but sitting on massive deposits while they cut through years of environmental red tape in order to get permits (and capital) to be able to begin mining.  They may be rejected and go BK but, if that mine ever opens – happy days!  

    Wow, that makes me feel old to look back so long on a play like that!  Still, gives you a good idea of what I mean by LONG-TERM Positions!  cool

    Nuclear war/Tommy – Didn't you hear, we're going to start testing nuclear weapons again!  

    FNV/Youri – I'd say they've gotten a bit overvalued at this point.  $143 is $27Bn in market cap and last year they made $344M so that's 78x earnings and this year might be a bit better but it's never going to justify that valuation.  When you choose a 2022 vertical there's not much to do with it but be patient.  If anything, you are now at $50/40 so $10 is no improvement but you can sell 2 July $150 calls for $5.40 ($1,080) and pick up 25% of your $4,675 entry while you wait, selling just 49 of the 602 days you have to play with.


  11. Trump / China    Does anyone know what time he speaks on this?  


  12. is UNG ripe to open a new position?


  13. Phil,

    Newbie here and for options. Have used many of your trades – AAPL, BRK.B, VIAC, JPM, SPG, SPWR, BBBY, M etc.. Some of them from your free site before becoming a member. Doing similar strategy with other stocks (ERI, LUV, SLB, ZM, AYX, VTIQ) to make sure I am learning and not just copying.  Have done well so far. Learning a lot. Thank you for your insights and approach to teaching. Wish I had found you before Mar 23rd. Never too late. 

    Lessons learned so far.

    - Didn't scale in SPG. Bought too much all at once though I had positions at $43 before that. 

    - Trying to understand Rolling Strategy at 25%, 50% etc
    - Struggling with hedging

    For hedging, I have bought

    - 2022 SDS 20/30 spread

    - 2022 SQQQ 5/30 spread
    - 2021 SQQQ 5/20 spread

    - Looking in to TQQQ

    Question.

    Ended up buying 2022 SDS. You have 2021 SDS. What's the significance of getting 2021 SDS spreads?
     

    You got a new fan. Thanks.


  14. I think trump speaks at 2pm ET


  15. Phil,
    What do you think of KC?
    Thanks


  16. Phil, Thoughts on AEM? another miner but mostly North America. Less political risk than GOLD? I cannot imagine gold and silver prices do not rise long term?


  17. Trump/Batman – Usually they are either around 2pm or right after the markets close – depending on what they want.  Since this is going to tank the market, I think he'll save it for the close.

    UNG/Millard – Well, it's cheaper than our original entry so I'd say yes, it's good as a new position.

    Welcome SK!  Never too late, indeed.  

    The difference between 2021 and 2022 is the rate of premium decay (Theta) on the short calls will give you a more immediate pay-off than the 2022s.  With the 2022, there is more time premium so we're able to buy a wider spread for about the same price but neither of these will pay significantly on a sharp move up unless the Nasdaq stays low for an extended period of time. 

    The logic to having a hedge that doesn't pay off is that, if the Nasdaq bounces back and the hedge never pays off – then your longs bounced back and you didn't need the hedge to adjust.  If, on the other hand, the Nasdaq goes down and stays down, the hedges pay off and you have plenty of money to adjust your long positions.  

    So this is all part of a LONG-TERM (see above for what I mean by LONG term) investing strategy meant to, in an emergency, give you the buying power you need to make adjustments during a prolonged crisis.  If it's a short-term crisis – we don't need to adjust much but what we really need to guard against is a 2008-9 situation, where the market goes down and stays down for close to a year.  

    There are also, of course, adjustments we make along the way and you'll see, at some point, how we unwind our hedges during a crisis or you can go back and review our Workshop series of articles or just read the last two week's of March's posts and comments.  

    That last one was May 12th and, since then, we've added more longs and today we added more hedges – that's the usual cycle we go through.  Generally, the hedges cost us about 25-30% of our upside but then we hedge the hedges in the STP with fun trades that often mitigate those damages but the primary goal is to steer our LTP and other long portfolios towards a double (in two years or less) while protecting those positions with the STP.

    Thanks Millard.

    Coffee (/KC)/Kgab – Coffee is crashing and we  like to play it down below $100 as that's about the break-even price for farmers so, like oil below $30, it's a price at which production begins to shut down and then the surpluses tend to correct themselves over time.  We had a play on JO but we cashed it out on the last spike.  I wouldn't trade the /KC futures unless you are very good with stops or don't mind doubling down around $90 and then stopping out below that line and losing whatever that works out to as it's a risky, choppy market for commodity trading at the moment.  

    The problem with coffee is you have no idea how demand was really affected.  SBUX was actually shut down for a month so imagine what that did to consumption.  People don't go to the office – another big point of consumption.  Do you drink 4 coffees a day at home?  I don't think most people do…..

    Meanwhile, the crops are still coming in (up 5% this year, in fact) as farmers are considered essential so there hasn't been any interruption in supply and no nasty weather events to hurt the crops.  

    Bottom line is I wouldn't pretend to know what's going to happen in coffee – it's hard enough to predict when market conditions are normal but this is a completely unique event and I doubt the repercussions have washed through the system yet. 

    JO is at $30 and you can sell Dec $30 puts for $3 to get a 10% discount – that's worth a toss but too much gambling for the Member Portfolios…

    AEM/Millard – They have 3.1M in reserves and trade for $15.6Bn at $65 with MAYBE $400M in profits (last year was unusual) so about 39x earnings for them and GOLD has 70M in reserves and trades for $44Bn at $25 and made $4Bn last year but expect just $1.4Bn this year so call it 31x earnings.  Dealing with the political risk is what makes GOLD so much more profitable and imagine how happy countries are going to be to get bribed now!  I simply don't see the point in gambling on small, unknown companies when I can instead INVEST in the biggest and best and most likely to weather any kind of storm.

    I think HMY is an interesting gamble.  They were on a good path pre-virus and were expecting to make 0.40/share going forward.  Let's add them to the LTP and see how they play out.

    • Sell 50 HMY 2022 $3 puts at $1 ($5,000) 
    • Buy 100 HMY 2022 $1 calls for $2.45 ($24,500) 
    • Sell 100 HMY Jan ('21) $3 calls for $1 ($10,000) 

    That's net $9,500 on the $20,000 spread but the short Jan $3 calls can be rolled to the 2022 $7 calls, now 0.85, if all goes well and then it's a $60,000 spread for $9,500.  Meanwhile, if the stock fails to move, we just sell 2022 $3 calls, now $1.40 for $1 and then we have a net $0 trade and only the obligation to own 5,000 shares at $3 ($15,000) so very little risk with a potential $50,000 gain.


  18. From my March 31st Portfolio Repair Workshop article:

    That means, very simply, that a lot of people are going to die – probably 200,000 and, though it's still not going to have much effect on the economy – keeping that number at 200,000 and not 2M requires us to shut down the economy probably well into May.

    Still, while this will obviously cause a Recession (two consecutive quarters of economic contraction), IF we mange to keep people and businesses from going into bankruptcy then, unlike normal recessions, we can hopefully sound the "all clear" siren on May 15th and everyone can go back to work and back to the malls and the economy would instantly go back to normal. The only thing preventing that happy outcome in my opinion would be shortcomings from Government and, unfortunately, I think it's obvious that we're already dealing with that at the moment.

    Sometimes I amaze myself!  That's why I used to get paid a fortune to consult for corporations – I'm pretty good with my guesses….


  19. Speaking of the virus, Brazil coming up fast with 438,238 cases, blowing past Russia at 387,623 (still a bunch of amateurs compared to our 1.75M).  Brazil might give the US a run for the money with 209M people and this kind of progression:

    Pope Francis draws millions to Copacabana beach, exhorts youth ...

    Pope Francis celebrates Brazil Mass on Copacabana beach - BBC News


  20. Christ the Redeemer - In fight against Coronavirus, statues around ...


  21. Phil,

    are the "Portfolio Repair Workshop" available on the "www.philstockworld.com" too ?

    All except 1 link points to seekingalpha.com.

    Thanks


  22. MY niece and family are in Mpls right in the middle of the mayhem there. All the action is very close to the VA hospital and, as usual, there is more to the story than we are hearing. We do not need this especially when everyone is under so much strain already. That south Mpls area is very nice close to Minnehaha creek and falls. People feel free to fly off the handle just like our leader in chief, the lyin King.


  23. Workshop/Gardling – They should all be the same day's posts on PSW – I just so happened to assemble the links for the SA crowd.

    I hope your family stays safe, Pirate.


  24. Greetings from the Home/War front

    You know it will be a different day when you look at the Weather and it says smoke.

    I live in the Howe/Longfellow neighborhood of Minneapolis and my son lives about 3 blocks from the Third precinct police station. When they moved there, they thought that the proximity would ensure their car was safe on the street. They feel differently now. Its amazing how things have changed this week. There is a house on their street that is smoldering. The owner has called 911 several times and is told the Fire Department is overwhelmed. We may have to start a citizen’s bucket/garden hose brigade.

    I love this area, it has so much culture that the suburbs cannot offer. We can walk to the Mississippi river in a few blocks. You can walk to a movie theater looks the same as it did in the 1950's, including imported Italian marble tables. There are places to pick up distinctive food and great coffee shops that are not chains. We have a community garden plot in one of the two remaining Victory gardens- that may be needed this year. My wife and I have been working from home since mid-March and last month I rode my bike or walked more miles than I drove. It is not upper crust; people are pragmatic and have Black Lives Matters and I love my Muslim neighbor signs in their yard.


  25. I apologize for the length; I have many ideas that I want to share. I am still chilled by the fact that my car was parked in the exact location that George Floyd was 24 hours earlier. I was picking up takeout from a nice Cambodian restaurant called Dragon Wok. Two days later, I watched the restaurants surveillance video on CNN!  I do feel connected with the community and can understand the outrage and demand for justice, to change the police behaviors. Bob Kroll is the head of the MPLS police union, he has said that Black Lives Matters is a terrorist organization and appeared at a Trump Rally talking about “the handcuffing and oppression of police”. You can understand this goes beyond community relations and is a fundamental issue at the core of the system. I think MLK said something like Riots don’t appear out of thin air, certain conditions exist, and riots are the language of the unheard.

    It’s tempting to focus our attention on the destruction that the neighborhood experienced last night–the fires, the windows, the merchandise lost, the graffiti, no mail delivery. I think the worst was an almost finished affordable housing apartment building that is really needed. The city budget is really going to suffer. I’d invite all of us to remember that these are symptoms of a society that has suffered for far too long under the crushing weight of inequality. I hope that along with the landscape of our neighborhood, our thinking has been changed.  We also should also recognize the brutal violence and years of systemic disparities that brought us here, right now. This will spread to other communities if it is not addressed. I had a feeling this was going to blow; I just did not know it would be here. When you have 20% unemployment, inadequate health care and a pandemic it’s hard to simmer down. You can go from safe to danger quickly. I caught some gas fumes yesterday too riding my bike after picking up some spare masks at store that was still open. That is really some art or war stuff MPLS PD to just spray that indiscriminately! News of an arrest in the case will go far!


  26. Thanks Greg – We should put that in our Strategy Section.

    Wow Randers, thanks for sharing.  Stay safe and let us know what develops!


  27. Phil – No problem. I'll see about getting these up there. All the workshop links are now at the bottom of the Strategy page, here:

    https://www.philstockworld.com/strategy/


  28. bnn said trump at two but no show so far hes likely busy trying to figure how to get back the African American vote after blowing it .


  29.  "Since this is going to tank the market, I think he'll save it for the close."  PD


  30. Well said Randers


  31. Trump pretty much declaring war on China. 


  32. Gasoline and Oil had a fun day:

    /NG still lagging:

    So  we're terminating our relationship with the WHO – that's lovely…

    Powell said there's no upper limit to the Fed's balance sheet:

    Well, at least Trump didn't speak for long but it was quite the list of grievances against China.

    Market snapped back up as it was all rhetoric and no actions taken – that's why it was scheduled before the close and not after. 


  33. Trump talks  - and markets are going up"?  war on china – no discussion on Minn….  what a crap performance


  34. Trump – i guess people are happy that he didn't raise tariffs on US – i mean China - 


  35. Well, technically 3,000 failed today so the clock re-starts on Monday – can't get two full days above the line so far. 


  36. Also, we didn't pull out of the China Trade Deal – which makes no sense given the rhetoric.  The only message China is getting is "If you take over Hong Kong and Taiwan we will be very, very cross!" 

    Mad president GIF on GIFER - by Nualanim


  37. Phil….psych! That's a short covering reversal.


  38. I think the main message here is that China is responsible for the Virus, that was the coherent message that seemed to be in Trump's script.  He's got to keep jamming that theme into people's brains – that CHINA attacked us with a virus and TRUMP saved us from it.  

    Sick Trump GIF by THEOTHERCOLORS - Find & Share on GIPHY

    Cartoon: Do you have the Trump virus?

    Reversal/Pharm – So crazy.  


  39. I will sleep better with my hedges over the weekend. Wonder how Xi will respond?


  40. The reality is Trump suspended China Travel on Feb 2 and mostly it was because any excuse to attack China scored him points with his mainly anti-China White House Crew.  On Feb 2nd there were 8 infected people in the US so Trump claiming that his travel restrictions on China saved a lot of lives makes no sense at all since we now have 1,734,986 people infected AFTER the travel ban.  Are his voters actually so stupid that they'll believe this crap?  I'm not sure – that's a stretch – even for Fox viewers. 

    Xi/Millard – China tends to be very slow to respond to things – especially when it's just words.  From China's point of view, they only have to put up with Trump for another 6 months.  That's nothing to them. 

    “If you wait by the river long enough, the bodies of your enemies will float by.”

    “Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win”

    “The supreme art of war is to subdue the enemy without fighting.”

    "If your opponent is temperamental, seek to irritate him. Pretend to be weak, that he may grow arrogant. If he is taking his ease, give him no rest. If his forces are united, separate them. If sovereign and subject are in accord, put division between them. Attack him where he is unprepared, appear where you are not expected .” – Sun Tzu


  41. When the virus was just starting to blow up the word was US soldiers in the area carried it back from Wuhan. Thanks for the good thoughts on my hometown of Mpls. Of all the places for this to happen this is truly a shock. They are progressive, clean and mostly law abiding citizens and provide many social benefits to their neighbors. Randers certainly hope you are yours stay safe. Now they are charging Chauvin maybe things will calm down. What do you distract the frazzled with? A war with China. Wow every time it is open mouth insert foot! And blame China for the virus, of course. NO mention of the racial mess-already way too late.


  42. Next week we pull out of NATO and the UN! 


  43. Most of the infections did not come from China….as I understand it….it came from the EU as people scrambled to get back to the US.


  44. I think trump is on crystal meth or fentenol and suffering from hypertension just like hitler.


  45. Pharm-I agree shutting off the flights really caused an influx BUT the airports were never shut down even in NYC! Not coincidentally the hardest hit. That's why I left FLA early. I thought the smart thing to do was shut down flights with that recirculated air. We probably would've shut the virus down quickly then instead  of having the highest infection rates in the world.


  46. NATO/StJ – This could be Trump's last 6 months.  No sense in playing it coy – Putin wants the entire US Alliance crippled before Trump leaves office so he's just going to start laying a path of pure destruction.  

    Well, have a lovely weekend folks!

    - Phil

    Donald Trump and Republicans Continue to Destroy America Based on ...

    Trump is evil! : ComedyCemetery


  47. Phil, quick question for you. I've got a small amount of cash sitting in my Canadian investment account. Don't have access to US stocks in this one, so just what trades on TSX. 

    Was just looking for something relatively safe to do with it for the time being. Was thinking just buying one of the major bank stocks (for example BNS, which pays a decent dividend) and then selling calls against the holding a couple months out and repeat. 

    Thoughts? I know aren't really keeping tabs on TSX stocks but thought i would run it by you. Want something relatively low touch, I've got spreads and short puts and the like in my USD portfolio. 

    Thanks!


  48. I saw a sixth grader poster this year that read:

    "All Lives Matter

    once black lives matter"

    Man, almighty, does that just nail it.


  49. Good evening.

    US COVID casualties are a product of extreme inequality. We effectively have a servant class in the US; "illegals" that are welcomed here by GOP mega-Agri business to pick fruit and man the slaughterhouses and the lower class US citizens (mostly minority/color) operating critical services. The rest of us can sit around and bitch and moan about haircuts and stock portfolios while our tummies are fed (and GET OUT OF THE WAY OF TRUMP if MEAT happens to go up by $1 per pound, I mean GEE WHIZ already).

    THAT'S WHY you do not see heat maps of death in Taiwan and South Korea, because they treat all of their citizens equally, relatively speaking.


  50. We are the undisputed, heavy-weight champion of the world for COVID cases and DEATH, because we are the undisputed, heavy-weight champion of the WORLD in inequality. No wonder so many people are so angry. Aliens essentially have no rights, so they show up at work (for $3.50 and hour) or it's STFU and get lost. No benefits, no time off, no access to a union, no access to the government. This is the slave class. The servant class, slave-wage laborers, the walmarters that are still on food stamps because they make 1/4th the inflation-indexed minimum wage we had in this country 30 years ago, they have no government access, no lobbyists in their pocket. But oh, the poor poor poor billionaires! We want to maybe raise capital gains tax from 20 to 21% and all of suddenly: SOCIALISM!! GOVERNMENT CONTROL!!!! Meanwhile income rates go to 37% and that's before FICA, medicare, state tax, UI, liability, labor and industries, FUTA etc etc etc….

    Somebody get me a lobbyist so I can go preach how with those lazy blacks you give them a finger and they take the whole hand…


  51. I hope everyone's weekend is going well.  

    Things sure seem to be going GREAT in America:

    Protests flare across U.S. | Live Events | Reuters

    George Floyd Death - NBC News | NBC News

    Riots in America: Fears About New Coronavirus Outbreaks - Bloomberg

    America clamps down on freedom of assembly as 25 cities imposed ...

    4 more years baby!

    Leadership!

    Protests rage for a fifth night across America | National ...

    Thread by @thedailybeast: OPINION: The arrest of CNN reporter ...

    ???????????LV???????????30????????? ...

    What reasonable person could see a  connection here?  Clearly the President's words did not lead to attacks on CNN, right? 


  52. Remember when there were riots in Athens and the people on Fox were calling Greece a failed state and urging the Government to step down?  

    Same thing in Egypt, Iran, Argentina, etc.   These riots, on the other hand, appear to be caused by "outside liberal agitators".  Someone asked the Minneapolis Police Chief if that was true and he said no, his arrest report showed almost all were from in-state.

    As if you need outside agitators to piss off the bottom 80% of any city at this point…


  53. Just 5 years before Trump:


  54. Good note by Trevor Noah:


  55. People start voting in MN in 110 days. I mean, it's almost here. Finally.


  56. When you call the press the enemy of the people, are you not surprised when they get targeted by some rogue cops?

    And BTW, there seems to be evidence of instigation by outsiders in many of these protests and there are also instigation on the police side. It's such a mess. And social networks are getting targeted by bots as well looking to incite violence.

    I don't know about anyone else, but I am just tired of the winning now! Maybe we should take a break and walk away from the poker table!


  57. And more tweets that didn't age well:

    "Our country is totally fractured and, with our weak leadership in Washington, you can expect Ferguson type riots and looting in other places," Trump tweeted on November 25, 2014.


  58. And Antifa is a terrorist organization but it's perfectly fine to walk in state houses armed with long guns to terrorize local politicians and to incite revolting against governors! No problem there, right!


  59.  

    Greetings from the Home/War front Day 6

    Today dawned a little brighter. I have never felt so connected with the people in our block.

    I know who is away and who has guns. We had a meeting yesterday to plan and talk about what is needed.

    There was a lot of traffic in the neighborhood this morning. There was near gridlock for several blocks as people dropped of food for those that need it. The schools have not been able to distribute it for summer programs this week. My son received mail on a Sunday, we did not. We have become vigilant citizens armed with makeshift weapons and group chats to report if they are seeing anyone on the block. We are wearing red for recognition and not venturing out of our home after 8pm. It is very strange walking your dog and knowing that if you see a car or anyone, they should not be out. There are others that are guarding the Co-op and Grocery store and the one remaining Pharmacy in the area. There is a feeling that we need to guard things because your call for help my go unheeded. We now have a routine of listening to the Blackhawk helicopters overhead as we finish dinner, and all receive the emergency notification on our phone about the 8pm curfew. I am not sure that I feel safer with the choppers here or more afraid that they are needed. This is during a pandemic with terrible economic conditions. Welcome to year 4 of Trump.

    There are unbelievable things happening daily. A semi-truck without license plates rambled thru our street yesterday and hit a bike without stopping. You can hear the sound at about 39 seconds on this Ring doorbell tape. The cyclist now has a broken arm. Maybe that was the same guy that went into the crowd on the 35W bridge. It reminded me of Rodney King in LA in 1992 but had a better outcome. Those in the crowd were shouting “Don’t hurt him, it defeats our cause”.

    https://ring.com/share/6832730254208702073?fbclid=IwAR34SE84oSBYMjkubluhujePOp3QcsuDyrkvGkEXvbHBK_iRBaaLI43mFhc

    ?People have also been finding accelerants stashed for lighting at later times. We have cleared the garbage and recycling from open alleys along with propane tanks. Stashes have been found at a florist and my beloved Riverview theatre and a garage 2 blocks from me. I hope that somebody gets pictures of the people. No one should get immunity, including state-sponsored violence and others. I hope that escalating violence is not the only answer and think that most sane people would agree with me.

    Great local coverage at https://minnesota.cbslocal.com/live/cbsn-minnesota/

    “Mad” Mike Max, normally a sports reporter at WCCO is my hero!


  60. That sign language person is my hero! I have never seen somebody so animated…


  61. I can’t believe the futures are barely down with our cities in flames. Really, what does it take?  
     

    I certainly hope we never find out. 


  62. Phil

    Agreed that is Nic Zapko, She deserves an Emmy!




  63. Police in New Jersey praised for marching in Floyd protests


  64. Bank of Thailand ready to curb recent baht strength


  65. wow randers1, thanks for sharing. I hope it doesn't come for the rest of us, but it looks bad there.


  66. the coward trump hiding in a bunker I thought he liked big crowds


  67. Greece Riot Explosion Molotov Cocktail Gif Bomb Explode Flame Fire ...


  68. MY nieces family in so Mpls has set up a command center for their neighborhood and are actually doing human barricades for the business, library's and the last gas station left in the area. The sounds of helicopters, unknown blasts are very frightening, but her two little girls are sleeping through it for which they are thankful. They say you can't count on any back up though two police cars drive through the blocks slowly, but it doesn't instill any confidence at all. They are also peacefully protesting along Minnehaha Parkway wearing red shirts.