Author Archive for Zero Hedge

Prices Are Going To Rise… And Fast!

Courtesy of ZeroHedge View original post here.

Authored by Alasdair Macleod via GoldMoney.com,

With stock-markets barely ruffled, few are thinking beyond the very short-term and they are mostly guessing anyway. Other than possibly the very short-term as we emerge from lockdowns, the economic situation is actually dire, and any hope of a V-shaped recovery is wishful thinking or just brokers’ propaganda. But for now, monetary policy is to buy off all reality by printing money without limit and almost no one is thinking about the consequences.

Transmitting money into the real economy is proving difficult, with banks wanting to reduce their balance sheets, and very reluctant to expand credit. Furthermore, banks are weaker today than ahead of the last credit crisis, and payment failures on the June quarter-day just passed could trigger a systemic crisis before this month is out.

Sooner or later bank failures are inevitable and will be a wake-up call for markets. Monetary inflation will then become an obvious issue as central banks and government treasury departments become desperate to prevent an economic slump by doing the only thing they know; inflate or die.

Foreigners, who are incredibly long of dollars and dollar assets will almost certainly start a chain of events leading to significant falls in the dollar’s purchasing power. And when ordinary Americans finally begin to discard their dollars in favour of goods, the dollar will be finished along with all fiat currencies that are tied to it.

Introduction – monetary transmission problems

Between different schools of economics there is much confusion over the link between changes in the quantity of money and prices, exposed afresh by the collapse in GDP due to COVID-19 and the aggressive monetary response from the authorities to contain the economic consequences.

Neo-Keynesians appear to understand the link exists, but for them inflation is always of prices which can be managed by adjusting monetary policy subsequently.

Monetarists follow a mechanical quantity theory leading to a relatively straightforward relationship between changes in the quantity of money and of prices after a time lag of a year or so. The principal difference with the neo-Keynesians is in the timing: monetarists see monetary inflation occurring long before the price effect, and neo-Keynesians in charge of central bank monetary policy assume rising prices can be controlled subsequently by varying interest rates.

The Austrian school, which


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Trump Visits Mount Rushmore For 1st Fireworks In Decade As Cancel Mob Hones In

Courtesy of ZeroHedge View original post here.

With the leftist cancel mob now looking to erase Mount Rushmore, President Trump is heading to the South Dakota landmark to kick off his 4th of July weekend.

The president will enjoy a fireworks display with some 7,500 people – who won’t be required to wear masks or socially distance. The monument, featuring the faces of  Presidents George Washington, Thomas Jefferson, Abraham Lincoln and Theodore Roosevelt, hasn’t had fireworks since 2009 due to environmental concerns, according to Reuters.

In addition to fireworks, the event will feature Lakota storytellers, a military flyover, hoop dancers, and of course – President Trump will entertain the crowd.

Governor Kristi Noem (R) told Fox News on Monday night that attendees at Trump’s Friday night event at the monument said that people who have health concerns over COVID-19 can “stay home,” but that face masks will be distributed so people can “choose to wear one.”

“We’re asking them to come, be ready to celebrate, to enjoy the freedoms and the liberties that we have in this country,” said Noem. “But we won’t be social distancing.

And of course, wherever Trump goes, triggerings follow.

Native Americans, who reportedly plan to protest during the trip, have criticized Trump’s visit for increasing the risk of spreading the virus and for celebrating U.S. independence in an area that is sacred to them.

The Democratic National Committee (DNC) tweeted at one point that Trump had disrespected Native Americans and that the event was “glorifying white supremacy.” It later deleted the tweet.

Both Washington and Jefferson, revered for their roles in the founding of the nation, were slave owners. -Reuters

“It’s an injustice to actively steal Indigenous people’s land then carve the white faces of the conquerors who committed genocide,” says Oglala Lakota Noation activist Nick Tilsen.

Cheyanne River Sioux Tribe chairman Harold Frazier has called for the removal of Mount Rushmore, saying in a statement “Nothing stands as a greater reminder to the Great Sioux Nation of a country that cannot keep a promise of treaty then the faces carved into our sacred land on what the United States calls Mount Rushmore.”

“The United States of America wishes for


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Abandoned Malls Are Now Being Turned Into Hybrid Apartment Housing

Courtesy of ZeroHedge View original post here.

Over the last couple of years, we have been extensively documenting the hastening trend of abandoned malls around the country. As brick and mortar unceremoniously gives way to e-commerce, one shopping mall after the next has been left for dead, with some even starting to be reclaimed by the Earth, complete with flora and fauna. 


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Rabobank: If 500,000 Rich Hong Kongers Leave The City, The HKD Peg Would Surely Collapse

Courtesy of ZeroHedge View original post here.

Submitted by Michael Every of Rabobank

Brawn on the Fourth of July

The US is on holiday today to celebrate Independence Day, which actually falls tomorrow. This 4 July it can do so with some big, brawny numbers to focus on. First of all, jobs. US payrolls yesterday smashed expectations (which consistently have proved not to mean anything in this crisis), rising 4.8 million. Put another steak on the BBQ! Unfortunately, weekly initial claims out the same day showed no sign of any improvement and new unemployment filings were once again 1.4 million. Let’s swap the steak for potato salad. Indeed, with re-openings on pause or being rolled back, and the cut-off point for June payrolls data sampling being around the middle of the month, the likelihood is that things are already stalling even though we are millions of jobs away from getting back to where we were on 4 July 2019.

Of course, the other big number is the virus. New cases in the US continue to surge, with 55,000 in a single day being the latest snapshot. As the Fed keeps saying, if that number does not come down, the other economic numbers are not going to hold up.

Not that this matters for financial markets in any way. They are guaranteed to be alright regardless. More virus equals more free money; less virus means more growth; and if it also means less free money it must therefore shortly after mean more free money. Otherwise markets will go down – and as markets cannot go down, appropriate measures will of course be taken. (The latest being the German Bundestag voting to support ECB QE to end-run the German constitutional court’s questioning of that policy’s validity.) Ray Dalio makes a similar point forcefully today, but isn’t saying anything this Daily(o) has not been saying for a long time. Indeed, I mention what is happening in the real world purely for those who are interested in current affairs rather than markets.

Where these two do intersect are a few key stress points which have the ability to make central banks look as impotent and irrelevant as they actually still are. (Have they sorted out inflation yet? How about climate change? Or inequality? Or curing the virus?)

Primary among these is still the US-China issue. The


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Britain Joins EU In Placing Restrictions On American Travelers As US Posts Another Daily COVID-19 Record: Live Updates

Courtesy of ZeroHedge View original post here.

Summary:

  • Gov Cuomo delivers a holiday weekend warning
  • Britain mandates quarantine for all American visitors
  • US reports another record case jump
  • Total cases (US): ~2,740,000
  • Washington State Gov pauses reopening
  • India reports new record daily jump
  • South Korea sees another 60+ cases
  • China cluster eases
  • Peru death toll tops 10k

* * *

Update (1000ET): Before you kick back with a bucket-full of Bud'Merica's and a wheelbarrow full of illegal fireworks, we implore you, dear reader, to read this special holiday weekend message from NY Gov Andrew Cuomo:

Oh and one more thing: If you haven't spoken to grandma lately, maybe find some time to give her a ring. You would probably make her day.

* * *

Update (0950ET): Joining the EU27, the UK has released an updated list of travel guidelines that will ease restrictions on visitors from dozens of countries, though not the US.

The EU has urged all European states to bar travelers from the US, unless they complete a mandatory 2-week quarantine upon arriving. The notable difference is that the EU will block most Americans from even traveling to Europe, while the UK will permit arrivals, so long as they agree to quarantine under close monitoring.

Nicola Sturgeon, the leader of Scotland's devolved government, bashed the conservative government's "shambolic" decision making process, but nonetheless said she would accept the updated guidelines. The devolved governments of Wales and Northern Ireland must also accept the guidelines, or set their own.

Meanwhile, in China's Hebei Province (not Hubei where Wuhan is) still has hundreds of thousands of families on mandatory lockdowns even as newly confirmed cases have once again trended toward zero.

Elsewhere, South Korea reported 63 newly confirmed cases of COVID-19


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The Complete Guide To Best & Worst-Run Cities In America 

Courtesy of ZeroHedge View original post here.

Personal-finance website WalletHub analyzed the 150 most-populated U.S. cities to determine the best and worst-run municipalities. They assigned each metro area a “Quality of Services” score comprised of 38 metrics grouped into six service categories (including financial stability, education, health, safety, economy, infrastructure, and pollution) - which was compared against each’s per-capita budget.

The study, titled 2020′s Best- & Worst-Run Cities in America, determined the effectiveness of local leadership in crisis and non-crisis periods. 

City leaders have been fighting the COVID-19 pandemic for months, and now many are tasked with keeping the peace while respecting people’s rights to demonstrate as protests against police brutality surge across the nation. People in local positions of power will undoubtedly feel extra pressure to please the public this year, as the November election will determine whether many of them keep their seats.

Even when the U.S. isn’t in a time of crisis, running a city is a tall order. The larger the city, the more complex it becomes to manage. In addition to representing the residents, local leaders must balance the public’s diverse interests with the city’s limited resources. That often means not everyone’s needs can or will be met. Leaders must carefully consider which services are most essential, which agencies’ budgets to cut or boost and whether and how much to raise taxes, among other decisions. -WalletHub

“How do we measure the effectiveness of local leadership?” WalletHub said. “One way is by determining a city’s operating efficiency. In other words, we can learn how well city officials manage and spend public funds by comparing the quality of services residents receive against the city’s total budget.”

The findings revealed Washington D.C. was the worst-run city, the second was San Francisco, and third Gulfport, Mississippi. 

Bottom 10 cities nationally:

  1. Washington, DC
  2. San Francisco, CA
  3. Gulfport, MS
  4. Chattanooga, TN
  5. New York, NY
  6. Hartford, CT
  7. Oakland, CA
  8. Detroit, MI
  9. Chicago, IL
  10. Flint, MI

The study determined the three best-run cities were in Idaho and Utah.

Top 10 cities nationally:

  1. Nampa, ID
  2. Boise, ID
  3. Provo, UT
  4. Las Cruces, NM
  5. Durham, NC
  6. Lexington-Fayette, KY
  7. Missoula, MT
  8. Fort Wayne, IN
  9. Virginia Beach, VA
  10. Nashua, NH

Notice some of the worst-run cities are concentrated on the coasts, or in Democratic states. 

Other metrics comparing the best and worst-run cities: 





Hong Kong Man Charged With ‘Terrorism’ In First Ever Security Law Case After Ramming Police

Courtesy of ZeroHedge View original post here.

Yesterday we noted that one of the Hong Kong pro-independence movement’s most visible young activists, Nathan Law, fled Hong Kong for an undisclosed outside country on fears of how the new national security law could be applied retroactively, especially given his and his close associate Joshua Wong’s public relationship with and backing by the US embassy and American Congressional leaders.

There is also the looming question of just what the law will look like applied in action. Recall that the law which went into effect Wednesday harshly cracks down on dissent and fomenting unrest with possible maximum life jail sentences for some crimes, largely dependent on the ambiguous and highly open to interpretation (with no independent review) question of what ultimately constitutes ‘foreign interference’ or sponsorship of a ‘terror’ organization. 

It was perhaps wise that Nathan Law didn’t stick around to find out how stringently it will be applied given that on Friday HK authorities made their first example, arresting a man for carrying an anti-Beijing sign after he was alleged to have intentionally rammed police with his motorcycle.

Protest slogans such as the popular “Liberate Hong Kong. Revolution of our times” are now banned by the National Security Law in Hong Kong. Getty Images

Reuters reports of the first ever instance of a protester being charged with terrorism under the fresh law:

A man carrying a “Liberate Hong Kong” sign as he drove a motorcycle into police at a protest against the territory’s Chinese rulers became on Friday the first person charged with inciting separatism and terrorism under a new security law.

It appears precisely this sign and slogan, which reports say is ubiquitous around Hong Kong streets, buildings and walls, which gave police the excuse and ability to bring harsher charges against the man, described as in his 20s, under the new security law.

The motorcycle ramming can now be effectively considered a political act of “terrorism” based on the security law.

Reuters continues:

Police say 23-year-old Tong Ying-kit rammed and injured some officers at an illegal protest on Wednesday. A video online showed a motorbike knocking over several officers on a narrow street before the driver falls over and is arrested.

Tong, who was hospitalised after the incident, was charged less than 24 hours


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Florida Passes New Jersey With More Than 175,000 Confirmed COVID-19 Cases: Live Updates

Courtesy of ZeroHedge View original post here.

Summary:

  • ES futures slide as Florida passes NJ with 178k COVID-19 cases
  • Gov Cuomo delivers a holiday weekend warning
  • Britain mandates quarantine for all American visitors
  • US reports another record case jump
  • Total cases (US): ~2,740,000
  • Washington State Gov pauses reopening
  • India reports new record daily jump
  • South Korea sees another 60+ cases
  • China cluster eases
  • Peru death toll tops 10k

* * *

Update (1030ET): It wasn’t the 10k+ jump from the other day, but Florida reported another 9,488 (+5.6%) cases on Friday, pushing its total case tally past New Jersey’s. The 7-day average is 5.8%.

While we didn’t take out the last record, hospitalizations in the state continued to climb at an alarming rate.

9488 new Florida COVID-19 cases overnight:
-178594 total cases (up from 169106)
-15491 hospital admissions (up from 15150)
-3864 deaths (up from 3617)
-42311 in Dade (up from 40265)
-18229 in Broward (up from 17116)
-15324 in Palm Beach (up from 14859) https://t.co/kEQN3K4Uxd

— Brian Entin (@BrianEntin) July 3, 2020

ES aren’t liking this (though fortunately the cash market will have the whole weekend to digest these numbers).

Florida is now No. 4 in the country behind only Texas (No. 3; 182k), California (No. 2; 248k) and New York (No. 1; 400k).

* * *

Update (1000ET): Before you kick back with a bucket-full of Bud’Merica’s and a wheelbarrow full of illegal fireworks, we implore you, dear reader, to read this special holiday weekend message from NY Gov Andrew Cuomo:

Oh and one more thing: If you haven’t spoken to grandma lately, maybe find some time to give her a ring. You would probably make her day.

* * *

Update (0950ET): Joining the


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China Buys US Corn, Soybean; Trade Deal Commitments Far From Satisfied 

Courtesy of ZeroHedge View original post here.

Around the same time President Trump and National Economic Council director Larry Kudlow were pumping jobs, stocks, and the V-shaped recovery on national television on Thursday morning – Reuters quoted a U.S. Agriculture Department (USDA) report that said China booked its first U.S. sales of corn and soybean since it asked suppliers (nine days ago) to guarantee shipments were not contaminated with COVID-19. 

Readers may recall, from day one of the trade deal being signed – we outlined how the number of proposed agricultural goods exported to China under the agreement was unrealistic

China’s purchases of US farm goods since the trade deal was signed in mid-January has been underwhelming. With today’s purchases, we’re surprised the president or Kudlow didn’t pump the numbers, rather Kudlow said: “We are very unhappy with China.” 

Reuters, quoting the USDA report, said China’s “private exporters reported the sale of 202,000 tonnes of corn and 126,000 tonnes of soybeans for delivery during the 2020/21 marketing year that begins on Sept. 1.” 

For more color on China not upholding trade commitments under the deal - we turn to Peterson Institute for International Economics (PIIE). Their trade deal tracker (latest data from April), shows China’s purchases under the trade agreement has been significantly below agreed-upon levels.

Even before the trade deal was signed – we outlined in December, vessel tracking data didn’t support China was purchasing farm goods from the U.S. – instead, they abandoned North American markets for Latin American ones. 

In June, we noted again; there was no way in hell that China was buying enough agricultural goods from the U.S. to satisfy commitments. Just look at the vessel tracking map below (from early June) - a massive traffic jam of ships carrying soybeans from Latin America to Asia was seen – and just a few vessels carrying beans in North America. 

What’s evident is that China has predictably fallen way short of its commitments of the trade deal as it now blames virus pandemic for reduced purchases.

The Trump administration should come clean and just admit the trade deal is a dud.





Fed’s Balance Sheet Shrinks For Third Consecutive Week

Courtesy of ZeroHedge View original post here.

After three months of unprecedented gains, which saw an increase of $3 trillion to $7.2 trillion, the Fed’s balance sheet has posted its third consecutive weekly decline since the start of the corona crisis according to the latest H.4.1 statement.

The drop in the week ended July 1 amounted to $73.2 billion, and was just shy of the decline recorded two week prior, which was the biggest weekly drop since May 2009.

However, as has been the case in the past three weeks, the drop in the balance sheet was not due to a reversal or even slowdown in QE which continues almost every single day, with the Fed adding another $15.8 billion in Treasurys even as the settlement calendar and prepays meant MBS shrank by $32 billion in the week ended July 1 (don’t worry, the Fed is also buying about $4.5BN in MBS every day), but once again due to a decline in liquidity swaps, which shrank by $49.5 billion to $225.4 billion, after a $77.5 billion in the week prior and $92 billion in the week before that.

The amount of outstanding repo agreements also declined for a second consecutive week by a modest $9 billion, after an $8.9 billion decline in the week prior.

As shown in the chart below, the total amount outstanding in the swap lines, designed to ease a surge in demand for U.S. currency in the participating banks’ jurisdictions during the early weeks of the crisis, was the lowest since early April.

Coupled with other indications of slackening demand for the Fed’s bevy of emergency liquidity facilities, the reduction in currency swap line usage is for many analysts a sign that global financial markets are returning to near-normal after being upended by the coronavirus outbreak in February and March. “We expect a more rapid decline over the coming months as the majority of the swaps will roll off,” Citigroup economists wrote in a note last Friday.

The flipside is that it also means that the system is once again seeing a shrinkage in the circulation of the world’s reserve currency, an explicit tightening in financial conditions, and the adverse global impact of any macroshock will be substantially greater when one hits in the coming weeks.

Meanwhile, with the S&P500 closely


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Zero Hedge

Prices Are Going To Rise... And Fast!

Courtesy of ZeroHedge View original post here.

Authored by Alasdair Macleod via GoldMoney.com,

With stock-markets barely ruffled, few are thinking beyond the very short-term and they are mostly guessing anyway. Other than possibly the very short-term as we emerge from lockdowns, the economic situation is actually dire, and any hope of a V-shaped recovery is wishful thinking or just brokers’ propaganda. But for now, monetary policy is to buy off all reality by printing money without limit and almost no one is thinking about the consequences.

...

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Phil's Favorites

Coronavirus deaths and swelling public sector debt share a data-quality problem

 

Coronavirus deaths and swelling public sector debt share a data-quality problem

Different countries report coronavirus data differently. Shutterstock.com

Courtesy of Marion Boisseau-Sierra, Cambridge Judge Business School

Watching scientists, politicians and journalists struggle to compare national death rates from the coronavirus pandemic, I had an acute case of déjà vu. Though the virus may be novel, the confusion generated by inconsistent data standards is anything but. It’s something I&...



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Biotech/COVID-19

Coronavirus deaths and swelling public sector debt share a data-quality problem

 

Coronavirus deaths and swelling public sector debt share a data-quality problem

Different countries report coronavirus data differently. Shutterstock.com

Courtesy of Marion Boisseau-Sierra, Cambridge Judge Business School

Watching scientists, politicians and journalists struggle to compare national death rates from the coronavirus pandemic, I had an acute case of déjà vu. Though the virus may be novel, the confusion generated by inconsistent data standards is anything but. It’s something I&...



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ValueWalk

The M&A Activism Picture Is Not All Rosy

By ActivistInsight. Originally published at ValueWalk.

This week we released Shareholder activism in H1 2020 – the definitive statistical report on an unprecedented proxy season.

Q2 2020 hedge fund letters, conferences and more

Given just how massive and longlasting the impact of the coronavirus pandemic has been, including an end to the longest bull market in history (followed after the briefest of pauses by a roaring recovery), an end to the ...



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The Technical Traders

Wild Volatility Continues As US Markets Attempt To Establish New Trend

Courtesy of Technical Traders

We’ve continued to attempt to warn investors of the risks ahead for the US and global markets by generating these research posts and by providing very clear data supporting our conclusions.  Throughout the entire months of May and June, we’ve seen various economic data points report very mixed results – and in some cases, surprise numbers as a result of the deep economic collapse related to the COVID-19 virus event.  This research post should help to clear things up going forward for most traders/investors.

As technical traders, we attempt to digest these economic data factors into technical and price analysis while determining where and what ...



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Kimble Charting Solutions

Nasdaq 100 Relative Strength Testing 2000 Highs

Courtesy of Chris Kimble

The tech bubble didn’t end well. BUT it did tell us that the world was shifting into the technology age…

Since the Nasdaq 100 bottomed in 2002, the broader markets have turned over leadership to the technology sector.

This can be seen in today’s chart, highlighting the ratio of Nasdaq 100 to S&P 500 performance (on a “monthly” basis).

As you can see, the bars are in a rising bullish channel and have turned sharply higher since the 2018 stock market lows. This highlights the strength of the Nasdaq 100 and large-cap tech stocks.

...

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Chart School

US Dollar with Ney and Gann Angles

Courtesy of Read the Ticker

Where is price going, is there strength or weakness in the chart?


Previous Post on the US Dollar : Where is the US Dollar trend headed ?


The question is always what will the future price action look like ?


This post will highlight the use of lines generated by angles. Not trend lines, as trend lines require two known points on a chart, where as angles require only one known point and a angle degree to draw a line. The question then becomes how is the angle degree determined.



There are two theories: ...

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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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