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One Way Wednesday – Up and Up We Go

4,743.83

That's the all-time high on the S&P 500 – a level we hit just before Thanksgiving and, this morning, we're back to the 4,700 line – as if the two weeks after Thanksgiving never happened.  And maybe nothing did – if you narrowly focus on the virus as the Omicron variant of Covid is what started the drop and now we've all decided it's not a big deal so back to "normal" in the market, which is pretty much up around 4,700 on the S&P.  

Remember when Covid first hit and it was Christmas time and the Government and the media tried to assure us it was no worse than the flu?  Anything to keep the stores open for the holidays or the Government will have to spend another few Trillion on bailouts next year.  What's worse, another 100,000 dead citizens or spending $20M to prevent each death?  You KNOW our Government doesn't value our lives that highly – insurance companies certainly don't – barely $1M in a wrongful death settlement on average.  

So the Government is not going to spend 20 times the value of a citizen's life to prevent ther death – nor should they from a logical point of view.  While Republicans are all about doing whatever it takes to defend your life before you are born (unless you or your mother need medical care or food or shelter, of course) – after you are born they could care less what happens to you.

Pfizer (PFE) this morning is using Omicron to promote getting more vaccines, saying that their two-dose regimen was significantly less effective at blocking the variant than three doses are.  That should hold their stock up for another couple of quarters along with their partner, BioNTech (BNTX) – both of which we have long positions in.

Singapore just passed a law that makes unvaccinated people pay for their own treatment if they contract Covid as those people are putting a disproportionate strain on their National (Free) Health Care System (all the civilized countries have it – except the US).  Singapore is one of many countries that have adopted measures to convince vaccine holdouts. Some European governments are tightening restrictions on the unvaccinated for restaurants and offices. Starting in February, Austria will require all adults to get vaccinated. In Vienna, those who fail to show up for vaccine appointments could face fines of up to $4,050. Greece has made Covid-19 vaccines mandatory for those over 60 and will start issuing fines in mid-January to those who haven’t received a first dose or made appointments to get their first shot. In Germany, politicians are debating similar policies.

Singapore, however, has already achieved one of the world’s highest vaccination rates, with 96% of its eligible population – which excludes categories such as young children – fully vaccinated, according to the government. It has achieved this in part by restricting activities that the unvaccinated may partake in: They can’t dine in at Singapore’s food courts or enter shopping malls.  Singapore has 5.7M people and 269,873 (4.7%) cases of Covid and 763 (0.0013%) deaths.

An encouraging note is that, globally, we have administered 1.18 Billion does of vaccine in the past month – so we are certainly capable of vaccinating everybody on the planet – we just need the will to do it.  The US will pass 50M (15.6%) total infections next week and 800,000 (0.25%) deaths – 200 TIMES the rate Singapore has.  As I said, the US Government is not going to waste their time or effort stopping you from dying – not if it might hurt the bottom line…

200 times 4,000 is 800,000 so 796,000 extra deaths x $1M = $796Bn worth of wrongful deaths but it cost us $4Tn to shut down the economy so – sorry!   Think about it this way, if you live in an apartment building with 400 people – you only have to pick one of them to die and the rest of you can go about your daily lives without masks or restrictions (I'd still get vaccinated, as there's no sense in being an idiot, is there?).  This might sound harsh to you but it's the decision almost every community in America has already made.  Think about who you will choose to kill today for your comfort – it's a fun exercise!

Avengers: Infinity War's Thanos Meme Is Now MCU CanonSince it's now been decided we find killing one in 400 people to avoid being annoyed by restrictions acceptable, we should probably be on the lookout for other ways to improve our lives like people who eat too much at the buffet or people who have yappy dogs (don't want to kill the dogs, people get upset about that).  People who can't decide what to order at the deli counter, people who can't seem to just move forward at the grocery store… (yes, I live in Florida) Shakespeare wisely said "The first thing we do, let's kill all the lawyers" and there's 1.3M of them in the US – that would fill an 18-month quota right there!    

Moving on to other ways the World is going to end:  Russia is going to invade the Ukraine (again), China is taking over Taiwan, another Chinese developer is on the ropes (Aoyuan), Japan's GDP shrank 3.6% in Q3 and 63% of the people in this country think it's heading in the wrong direction and only 27% think it's going the right way (10% undecided) and 61% said specifically the Economy was headed in the wrong direction.  

That is why we are STILL shorting the S&P 500 (/ES) Futures at the 4,700 line – with tight stops above and we're also shorting Oil (/CL) at $72.50 – also with tight stops over that line.  Oil inventories are out at 10:30 this morning and we usually don't like to play into inventories but Oil is up 10% ($7.50) in the past week for not good reason so we expect at least a $1.50 rejection at $72.50, back to $71 and that would be good for gains of $1,500 per contract!  

We went long on Natural Gas (/NG) yesterday at $3.80 and we got another chance to enter early this morning but we have to be careful with those as they may get dragged down with Oil if there's a bigger than expected build (indicating lower demand).  

 


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  1. Good morning, everyone. Here is the link to today's webinar

    https://attendee.gotowebinar.com/register/6502227412731842061


  2. The Kleptocrats Next Door




  3. DOCU   CEO buys $5M stock :

    "I am surprised, I'll be straightforward with you. I do not see the reaction in the stock price to be commensurate with what I think is a much less dramatic business performance change," Springer said. "I've made two phone calls since I saw the reaction, first was to [my general] counsel, and I asked him, if there is anything that stops me from buying stock. He said as long as you wait until the window opens on Tuesday, and you haven't been selling shares, so therefore you can you can buy all you want. And the second one was to my financial manager, and lined up the first $5 million of purchases. So if the stock doesn't dramatically increase, I'll be continuing to buy shares."


  4. Good Morning.


  5. Good morning!

    All going our way(s) at the open with /NG, /CL and /ES but not much movement overall. 

    Well, /NG failed already but that's why I said we have to be careful – still like the long again over the $3.80 line but you play on the way up, not down.

    /SI getting to support

    Copper still a hot product:

    Coffee is crazy:

    If you put sugar in it, SBUX loses money!

    DOCU/Stock – Wow, Billionaire buys $5M worth of stock is the actual headline – what a manipulative joke!

    Bottom line is DocUSign was a necessary evil of the pandemic – like Zoom.  It doesn't mean people actually WANT to use it.   $141.69 is still $28.26Bn for a company with $2Bn in revenues and $400M in profits – both jacked up from the pandemic.  Still 50x even if you assume this continues.  Old price of $250 was just idiotic.  





  6.  
    BLDR +7.72%
     
     
    Dec. 08, 2021 10:02 AM ET

    • 11.033M October Job Openings vs. 10.400M consensus and 10.602M prior (revised from 10.438M).
    • Job openings rate 6.9% vs. 6.6% prior.
    • Accommodation and food services had the biggest increase in job openings (+254K), followed by nondurable goods manufacturing (+45K), and educational services (+42K).
    • Quits rate 2.8% falls from a series high of 3.0% in September. the largest decreases were in transportation, warehousing, and utilities; finance and insurance; and arts, entertainment, and recreation. Quits increased in state and local government, excluding education; and in mining and logging.
    • Last week, November job gain of 210K trails 545K estimate as unemployment rate falls to 4.2%

     
    THO +1.80%
     
     
    Dec. 08, 2021 9:51 AM ET

    • Thor Industries (THO +0.6%) after reporting an earnings beat and 55.5% revenue growth driven by higher sales in North America following recent acquisitions.
    • By segment: North American Towable RV segment (+61%); North American Motorized RV segment (+87%); European RV segment (+5%). The addition of Tiffin Group accounted for 47% of the increase in increase in North American Motorized RV net sales.
    • Consolidated gross profit margin increased 170 bps to 16.6% primarily driven by the increase in net sales, a reduction in sales discounts since the prior-year period and selective net selling price increases.
    • "It seems the market focuses on the supply chain and labor challenges that our industry is facing right now more than it does our performance in the face of those challenges, but our performance has been consistent despite those challenges," commented CEO Bob Martin.
    • The company's 88,100 RV deliveries outpaced the RV industry's growth rate of shipments. Global order backlog increased to more than $18B, reaffirming Thor's view that the dealer restocking process could possibly extend into calendar 2023.
    • Read what Thor's outlook for the full 2022 fiscal year here.

    There's a hidden gem.  THO is in a pretty good trend as people are using RV's to live in.  They are on a great growth path and $720M in profits is over 10% of their $6Bn market cap at $106.  They are super-attractive over the option prices too so, for the Future is Now Portfolio (where no one can afford a proper home anymore), let's:

    • Sell 5 THO 2024 $100 puts for $22 ($11,000)
    • Buy 10 THO 2024 $100 calls for $30 ($30,000)
    • Sell 10 THO 2024 $130 calls for $17.50 ($17,500)

    That's net $1,500 on the $30,000 spread that's $8,500 in the money to start.  Upside potential at $130 is $28,500 (1,900%) and the worst case is owning 500 shares at net $103.  


  7. Huge net build in oil so looking forward to a nice drop. 

     
    CL1:COM -0.11%
     
     
    Now!


  8. THO – I used to prepare their tax returns in a previous life at Deloitte.


  9. THO/Phil – I like THO. I have 10 2023 80-95 BCS with 5 short $80 Puts for net $3317 (and it hasn't moved too much since… primarily because the vol shoots up if the stock falls by a couple of percents). I entered this in June this year (I think we discussed it in the chat). Would you roll this to 2024? My thoughts are that it is 100% ITM, and if for some reason it does fall, the 2024 roll should be cheaper, so I should stick to my existing 2023 spread.


  10. THO Phil, well good decision. I have been riding the wave with WGO, by selling puts constantly. Just you comment for poor people.

    Here in Europe it is hard to even get a RV, as they are extreem popular. I do even have two homes and live for 10 month of the year in my RV, just like now over the winter in Spain, as long as I still can do it. You get Motorhomes you even can drive your tesla in to it. So do not get the wrong picture.



  11. Nuclear Fusion’s Time is (Finally) Coming



  12. THO/Prakash – Great, any juicy tidbits?   wink

    THO/Rn – Looks like net $10 on the bull call spread and you make another 50% by waiting so why mess around?  For net $3,317 on a $15,000 spread that's 100% in the money with a year to go – why not just buy more of those?

    RV's/Yodi – RVs have gotten nicer and homes have gotten worse so a percentage of people who would have gotten homes are getting RVs and that is a cycle that probably has some legs.  

    I like the Tour Bus!  

    You can get one of these for about $250,000 new, pay about $1,500/month plus whatever it costs to park it somewhere.



  13. I would have covered my entire cost of College for two without having four of those rides… Campsites can cost as much per night as an Embassy Suite!

     

    Ah, but the memories!  :)




  14. Nice pictures thanks



  15. Not much going on today.

    Re-shorting /ES if they hit 4,700, /CL shorts still active, if /NG hits $3.80 again will go long again but still tight stops below.

    • Less than two years into the pandemic, COVID-19 case numbers are on the rise again in the U.S., even as the country has crossed a major milestone in its immunization drive against the disease.
    • According to the latest data from the Centers for Disease Control and Prevention (CDC) over 200 million Americans are currently fully vaccinated against COVID-19, a little over 60% of the total population.
    • Out of the fully vaccinated, about 56% have opted for two-dose Pfizer (NYSE:PFE)/BioNTech vaccine while ~36% and 8% have received Moderna (NASDAQ:MRNA) and Johnson (NYSE:JNJ) vaccines, respectively.
    • Meanwhile, the average number of daily new coronavirus cases in the country has increased to approximately 119,000 this week from nearly 95,000 on Nov. 22, ABC News reports. COVID-related hospitalizations have risen 25% from a month earlier, and the average number of deaths, standing at nearly 1,600 a day, has approached the level seen in October.
    • While the Delta variant of the coronavirus has driven the latest surge, the newly emerged Omicron variant has now been found in about 20 states. Today, Pfizer (PFE)/ BioNTech (NASDAQ:BNTX) cited early lab data to indicate that three doses of its vaccine protect against the variant.

    Titanic Titanic Orchestra GIF - Titanic Titanic Orchestra Nearer My God To  Thee - Discover & Share GIFs