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Faltering Thursday – Reality Rears it’s Ugly Head

The truth.

We don't get a lot of that in America these days.  Remember when we used to pity the poor Russians, who were being fed misinformation by their Government from the state-run media?  While it certainly can't make Fox news any more of a GOP propoganda network than it already is, now they featuring Trump weekly, violating the Equal-Time Rule that says "U.S. radio and television broadcast stations must provide an equivalent opportunity to any opposing political candidates".  This means, for example, that if a station gives a given amount of time to a candidate in prime time, it must do the same for another candidate who requests it, at the same price if applicable.

We know this is going on with our Political News but you also need to be aware this goes on with our Financial News as well.  Fox News (Murdoch) is sponsored by GOP supporters, Climate Deniers, Covid Deniers and, of course, the keep America White crowd while CNBC, Fox Financial (Murdoch) and the Wall Street Journal (Murdoch) are so embedded with the Government that Larry Kudlow, of CNBC's Kudlow and Cramer is the White House Economic Adviser.  While that, of course, makes sense when you have a Reality TV President – it doesn't make a lot of sense if you were, for example, trying to run a $20Tn economy. As noted by American Progress:

One would think that news organizations ostensibly devoted to understanding and explaining Wall Street would know better. Either way, the dishonest propaganda push undertaken by CNBC and the Wall Street Journal is politically disconcerting from the standpoint of a functioning, well-informed democracy. From the standpoint of moral and intellectual honesty, it is downright criminal.

Matt Wuerker's Editorial Cartoons - Roger Ailes Editorial Cartoons | The  Editorial CartoonsAnd that moral and intellectual dishonesty is affecting your health, your safety and your portfolio.  As much as you KNOW that these networks are lying when they are denying climate change, promoting miracle vaccines or propping up despicable bastards for public office – you have to realize they are ALSO lying to you when they tell you how great the economy is and what to invest in.  

Why would they not have an economic agenda as well as a political one?  And it's not just CNBC and Murdoch Media that are doing this.  ALL the TV networks are run by people in the Top 0.1% – the same people who benefit from ignoring climate change and propping up political parties that refuse to address or even admit the growing inequality in our society.  

Here's a good example:  Did you even know that there was a massive study released this week that showed that the MEDIAN worker should be making $102,000 per year in America, $42,000 more than they do make, if not for some $2.5 TRILLION being "reverse distributed" away from the working class to the entitled class?  

We were shocked by the numbers,” says Nick Hanauer, a venture capitalist who came up with the idea for the research along with David Rolf, founder of Local 775 of the Service Employees International Union and president of the Fair Work Center in Seattle. “It explains almost everything. It explains why people are so pissed off. It explains why they are so economically precarious.”  It's a very interesting, very NEWS-worthy study, isn't it?  Did you hear a word about it?

And there it is in black and white – the Top 1% are making $200,000 more than they should be if they were taxed THE SAME as everyone else yet their refusal to live on $560,000 causes 1/2 of the country to make 1/2 as much money as they would be makign under a fair system – the same system we USED TO HAVE in the 50s and 60s, when America was, ostemsibly, "great."

So how do we make America Great Again?  Get rid of the lying bastards who use that for a slogan, for one thing!  Even workers in the 90th percentile, making $133,000 a year are getting screwed over by Trump/GOP policies. “From the standpoint of people who have worked hard and played by the rules and yet are participating far less in economic growth than Americans did a generation ago,” said David Rolf, “whether you call it ‘reverse distribution’ or ‘theft,’ it demands to be called something.” 

“There is no way of slicing the numbers where people come out ahead,” says Carter Price, a senior mathematician at RAND, who co-authored the study with his colleague Kathryn Edwards, an economist. “I was surprised by the magnitude of this.”  For the vast majority of Americans, what they earn at work through hourly wages or a salary represents practically all of their income. And that is fully captured in the study.

Six Clever Cartoons on Income InequalityThey say the blame lies, in large measure, with decades of failed federal policy decisions—allowing the minimum wage to deteriorate, overtime coverage to dwindle, and the effectiveness of labor law to decline, undermining union power. They also cite a shift in corporate culture that has elevated the interests of shareholders over those of workers, an ethos that took root 50 years ago this week with the publication of an essay by University of Chicago economist Milton Friedman.

Who is talking about this, why have you not heard of it?  Go ahead, Google "Rand Study Income Inequality" and YOU decide if you think this study and it's implications were generally buried by the media.  Why is that?  The advertisers don't like that, the OWNERS don't like that, even the well-paid anchor people don't like that.  And why should Americans have to talk about things we don't like or that make us uncomfortable – that's just not the way we were raised – by the media…


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  1. Good Morning.



    At times, words don't sum it up…..

  3.  Permanent business closures due to COVID have climbed says Yelp, per a CNBC note. They now expect 60% of businesses to not reopen

  4. CNBC – Airline bailout "Where does it end?"


    How's that share buy back taste?

  5. White House: Airlines? Please, we're talkin TicTok Yo….  :)

  6. Good morning. That George Carlin really gives a reality check for the day. Going to food bank today which gives another reality check. I'm truly in terror about this upcoming election. I wonder if we will be jumping off the cliffs as things descend further into chaos which I am sure is the intention. Talk about descending into hell-it is here.

  7. History Doesn't Repeat Itself, but It Often Rhymes” 

    Mark Twain?

  8. Good morning!

    60%/Stock – Of what?  All businesses?  

    Well, I guess that is actually good for big business – the survivors, anyway.  

    Jobless claims were lower than expected but employment growth is still sluggish

    Coronavirus live updates: Targeted lockdowns return to Europe; BioNTech buys vaccine production site

    ‘Very serious situation’ unfolding in Europe, WHO warns, as cases rise dramatically

    Moderna expects to know if its coronavirus vaccine works by November, CEO says

    Barr blasts his own DOJ prosecutors, equates them to preschoolers and ‘headhunters’

    Why GNC filed for bankruptcy protection despite vitamin sales boom

    Climate change is fueling wildfires in the West, ravaging local economies

    U.S. housing starts fall more than expected in August as multi-family home construction slumps 

    The U.S. is still a dominant power — but it’s unclear if it remains the global leader 

    Ah, here it is, restaurants.  60% of CLOSURES are permanent – that makes sense.  

    Almost as many dead businesses as people…

  9. Honestly Phil, the amount of 'entrenuership' had been dizzying and you had to know any sort of hiccup in the economy would send many to Pirate's pantry and thousands more around the country.

    This was not a re-set I was hoping for, but here we are…. :(

  10. entrepreneurship…. where's my dam spellcheck?…. :)

  11. good morning

  12. phil/wba 

    i'm short 10 2022 35 puts at 4.19

    long 15 2022 bcs 35/50 at 6.02.  any thoughts? im happy to stick with it unless you have any better idea. thanks 

  13. Off cliffs/Pirate – yes, I have dual citizenship, US/RoK, but Korea's not letting anyone from the US in right now. There goes my bail-out option.

  14. I'm headed to NW Wisconsin this weekend to a cabin near Hayward & Spooner, about 2 hours south of Pirate. I am always amazed by the number of Trump signs. The natives must feel that he is doing a great job for them. 

  15. Phil, Thoughts on natural gas given the big drop today?  Quite a disconnect between current month and next month contracts (.50 cent).  New UNG trade?

  16. Phil, this post, this information, this realization, should be posted on top of everyone's social media feed.

    People, all people:

    “There is no way of slicing the numbers where people come out ahead”  


  17. Short-Term Portfolio Review: $160,357 is up 60.4% for the year but down $254,797 from our last review as TSLA does another one of their wild swings.  Our STP is not supposed to be up when the LTP is up – we've just been very spoiled this year with some fortunate calls but mostly it's because we were miles ahead that we gambled on TSLA, which is both an excellent hedge (as it's not likely to stay up if the market falls) and a bet that's hopefully going to pay off – even in a good market.

    Is the market good?  That's the big question.  We have left so many positions alive in the LTP we HAVE to have some massive hedges to protect what is now over $1M in longs but, in reality, we've made no progress from $1.2M (up 100%) that the LTP/STP hit in June so a pretty dead summer spent keeping our money safe.  

    • CANE – Well it's tracking properly.  Sugar is up 20% since we went in and CANE is up 20% too but only just now putting us in the money.  Now the fun starts, hopefully, if we can break over that resistance.

    • TQQQ – We got more aggressive and we just have the long puts.  If the Nasdaq falls 10%, TQQQ falls 30% to $85 and we have the same $75,000 we have now.  We already made $7,000 on the short puts so I don't think there's enough upside here to justify keeping it – done with this.

    • INTC – Newish.
    • WBA – New
    • SQQQ – Well, we just cashed in $86,750 on TQQQ so how can we put that to good use?  The SQQQ Jan $25s are out of the money at $7.30 and we paid net $2 for the spread so how do we take advantage of that and reduce our Theta Decay so we're not the suckers paying the premium?  It's a 3x ETF so a 10% drop in the Nas will give us a 30% pop to $34 and our short calls are $35 so that works.  I think what would make me happy is rolling our 100 SQQQ $25 calls at $73,000 to 200  of the June 2021 $15 ($13.50)/30 ($8.50) bull call spreads for net $5 ($100,000), using some of the TQQQ money we just cashed.  So we're taking net $59,750 off the table but we've moved our SQQQ protection to a $300,000 spread (was $100,000) that's $200,000 in the money so the only way we can lose on this hedge is if the Nasdaq goes higher – which is good for our longs.

    • SDS – That one's at the money.  SDS is only a 2x ETF so 10% down on /ES takes it 20% up to $19.50 so, like SQQQ, we may as we capture our $4.05 before it starts to decay.  The 2022 $15s are $4.05  and the $10s are $6.20 so $2.15 to roll $5 into the money is a great idea but we just invested in SQQQ so we can pay for this one by rolling 300 2022 $15s at $121,500 to 200 2022 $10s at $124,000 and now we're $120,000 in the money at $16 and, when those short Jan calls expire, we can sell calls like the 2022 $20s for $3 and take half our money off the table and still have a $200,000 spread that's mostly in the money.  

    • CMG – Finally came down a bit but we still have to roll our 3 short Sept $1,050 calls at $56,160 to 5 short Jan $1,200 calls at $135 ($67,500) and we will sell 2 Jan $1,100 puts for $55 ($11,000) and then we'll see how earnings go.  

    • TSLA – Just have to be patient with this one but, officially, next time we're green on the short calls, we should put tight stops on 1/2 so we're not so volatile.  We don't need this much hedging – we're well-covered above.  By the way, notice the short Jan puts are a ridiculous $106,050 – if we do end up having to roll, that's free money we'll be able to use to offset the cost as we can't lose both ends. 

    • UNG – We lost ground on the pullback but let's take advantage and buy back the short $12 calls.

  18. Well, another "rally" bites the dust.  

    WBA/Stuart – Seems fine to me.  Just add patience…   What I would do is spend $3.50 to roll to the 2023 $30 calls and roll the short 2022 $50 calls at $1.85 to the Jan $40 calls at $1.85 with a stop on 1/3 at $2.25 and 1/3 at $2.75 so your worst case is you have 5 short left to roll against 15 longs that are $10 in the money and then you can keep selling short calls for income for 2.5 years.  

    /NG/Ult – 10% is crazy!  

    It's really got nothing to do with inventory, just people dumping out of front-month contracts. 

    Storage is near the top of the range – that's the problem and this report wasn't a huge build but it didn't help the excess inventory either:

    Working Gas in Underground Storage Compared with Five-Year Range

    Information/Rperi – Please do send it around.  I think people need to know what's going on.

  19. Very happy if we get to buy /NG back around $1.60, by the way, been a while since we've been able to play it long.  LNG not affected – that's why I like to play the "miners" like LNG, GOLD, VLO, TOT, WPM – rather than the commodities – the people who mine, trade and sell commodities can make money in many ways whereas the actual commodity bet is a coin flip you will win or lose.

    Speaking of miners:

    WTF?!?  Manipulate the markets much?  

    Bruce Plante Cartoon: Trump and the Environment | Columnists |

  20. Clearly Trump and his buddies aren't done loading up on NAK yet.  

  21. So NAK up 17% on Trump tweet.   How much does it fall if he loses?

  22. Phil / SQQQ rollout

    Are you planning to keep the 100 short Jan 21 35 calls in LTP or buying it back now? What would be to plan to unwind this in the future if you are not planning to buy back the short position?

  23. NAK really does seem like a good proxy for the election doesn't it? Can't hurt PSW subscribers on that position at this point, I think most of us have a negative cost basis in there by now :D

  24. i finally got into NAK.  the 2022 $1/$5 spreads are $0.50.   gotta love 256% IV haha

  25. Staying ugly into the end game.

    NAK/Tangled – There were rumors of progress and then Trump tried to knock it back down.  They are definitely playing games over there.  Biden/Obama opposed that thing for 8 years, they need to ram an approval through by January or it may be over.

    Trump and environment | Cartoons |

    Drawn to the News: 12 cartoons on Donald Trump's climate decision

    5/17/2017 | Political cartoons, Pebble mine, Bristol bay

    SQQQ/Jij – Yes, I doubt the short $35s will end up in the money so let them expire.  Otherwise, roll them along.  

    We did get a little pump into the close but not enough.

    NAK/Ati – Just playing with house money now.  

    Well, not Monk…


  26. Hi Everyone, Here is the replay of yesterday's Webinar.