Archive for the ‘Phil’s Favorites’ Category

Beirut explosion: the disaster was exceptional but events leading up to it were not – researchers

 

Beirut explosion: the disaster was exceptional but events leading up to it were not – researchers

Aerial view of ship loaded with shipping containers in ocean

A trade in waste flows from Europe to Asia. Avigator Fortuner/Shutterstock

Courtesy of Scott Edwards, University of Bristol and Christian Bueger, University of Copenhagen

At the time of writing at least 100 people have lost their lives and a further 4,000 have been wounded following an explosion in the Port of Beirut. While the actual cause remains uncertain, the tragedy calls to attention the tremendous consequences of a lack of port security.

The explosion, on August 4, at around 6pm local time, appears to have been fuelled by 2,750 tons of the highly reactive chemical ammonium nitrate. The chemical had been the cargo on a ship, the the MV Rhosus, which entered the port at Beirut in 2013 due to a lack of seaworthiness and was prohibited from sailing. After the ship’s owner abandoned the vessel soon afterwards, the ammonium nitrate remained in a storage facility in Beirut’s port.

While the disaster itself was exceptional, the events leading up to it were not. Hazardous material is shipped across the world’s oceans on a daily basis. It is often mishandled or illegally traded. Abandoned containers of hazardous goods are found regularly in ports.

While maritime security tends to focus on preventing high-profile events such as piracy, terrorism or cyber-attacks, all too often it is daily mishandling that makes disasters possible. Part of preventing disasters such as what has happened in Beirut will mean strengthening port management and addressing crimes such as smuggling and corruption.

Abandoned ships

The International Maritime Organization (IMO) has recorded 97 cases of abandoned ships and crews since 2017. Ships are abandoned by their owners if a vessel is no longer lucrative to maintain, or perhaps if the ship has been stopped by authorities and fined. While the situation of the seafarers aboard these ships is often tragic, as they may receive little pay or even food for months, what happens to the load of the vessels is often unclear.

And the IMO number only reflects the cases of ships – we know little about how many containers stand abandoned in…
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How TikTok got caught in the crosshairs of US-China politics

 

How TikTok got caught in the crosshairs of US-China politics

Vowing to ban TikTok was a power play by the US president. Evan El-Amin / Shutterstock.com

Courtesy of Kerry Brown, King's College London

Donald Trump’s threat to ban TikTok, a video sharing app owned by Beijing-based ByteDance, on August 1 is only the latest in a series of clashes between the US and China. With each of these events – from the US ban on telecoms company Huawei to the US response to events in Hong Kong and the continuing escalation of the trade war which stretches back formally to 2018 – one has to remember that there are several different conflicts taking place between the world’s largest and second-largest economies. It is important to work out which of these the TikTok issue belongs to.

Ostensibly, the main reason for a ban is national security concerns. Trump administration officials say TikTok could pose a security threat by giving the Chinese government access to vast amounts of US citizens’ data. Yet there is little evidence for these claims, nor how Trump’s proposed solution of selling TikTok’s US operations to Microsoft would solve the problem.

Similar issues were raised by the ban on Huawei, and the operations of other major Chinese corporates in the US. They even predate the Trump presidency, reaching back to the mid-2000s when Congress vetoed Chinese involvement in energy company Unocal, and raised questions about tech company Lenovo’s purchase of the US IBM ThinkPad brand.

A strange security risk

TikTok seems to pose a strange kind of security challenge, given that most of its content is silly viral video memes. With Huawei there were more complex matters to verify, such as how to check the reliability of its hardware. TikTok doesn’t involve these to such an extent. So why the focus on this company?

Reaching beyond the realm of security, therefore, we must venture into that of trade and technology. TikTok’s greatest problem is that it manifestly demonstrates Chinese success beyond the borders of China. This is not as common as it might seem. Chinese companies which are genuinely internationally successful are few and
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What the huge COVID-19 testing undercount in the US means

 

What the huge COVID-19 testing undercount in the US means

Health care workers use a nasal swab to test a person for COVID-19 in Pembroke Park, Florida. Joe Raedle / Getty Images News

Courtesy of Melissa Hawkins, American University

Researchers from the Centers for Disease Control and Prevention and other institutions recently published a study which estimated that the true number of people infected by COVID-19 could be six to 24 times higher than the number of confirmed cases. Melissa Hawkins, professor of public health at American University, explains what this large undercount means and why insufficient data is hampering the U.S.‘s ability to control the pandemic.

Melissa Hawkins explains the implications of the COVID-19 testing undercount.

What are some reasons for the large disparity between the true number of infected cases and the confirmed case count in the U.S.?

We just passed 4 million total confirmed cases and over 150,000 deaths. But those confirmed cases really only tell part of the story since we know the cases and deaths are undercounted due to lack of testing. Particularly at the beginning of the pandemic, only those with significant illness were tested and there were shortages and problems with the test.

We also know that there is a significant amount of asymptomatic spread that isn’t captured in those testing numbers, particularly in places that still lack access to widespread testing. Many researchers are attempting to model and estimate the true number of total cases and deaths. The CDC study that you’re citing – those estimates of a true infection rate range from eight to 10 times higher than the number of cases that are confirmed.

Were you surprised by the results of the study?

Testing is the foundation of a modern public health approach to controlling this virus. We have lots of tools in our tool kit, but at the very foundation is widespread testing. So is this surprise? No, because the U.S. has had problems with our testing from the very, very beginning and now we’re playing catch up.

We…
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It’s Directional

 

It’s Directional

Courtesy of 

Johnson & Johnson announced Wednesday that it will develop and deliver 100 million doses of its coronavirus vaccine for the U.S. in a deal totaling more than $1 billion.

The company’s experimental vaccine is currently in early-stage human trials and is expected to begin late-stage human trials in September, executives have previously said. The deal gives the U.S. the option to order an additional 200 million doses, according to the announcement.

This is really all that matters. Just about everything else is noise, because the virus being prevented will change it all. Therefore, if you just think and focus on this one thing, you’re saving yourself a lot of time.

There will now be a steady procession of vaccine related news each week into the actual FDA approval. My bet is that the first vaccine is approved this fall, before the election. I don’t know anything about vaccines but I know all I need to know about people and incentives.

Batches are already being produced for several of the leading vaccine candidates. Maybe more than one gets approved this year. You don’t need enough doses for everyone. You just need enough for people to feel like the problem has a solution.

The economy is going to roar if this happens. Roar. The stock market is sniffing this possibility out. So are the metals and other commodity prices.

If you’re hearing people saying boring, predictable things like “It’s going to be a long time before things get back to where they were blah blah blah” they’re absolutely clueless about how this stuff works. It’s not about the degree of recovery for the stock market, or some now-forgotten high watermark for a particular economic benchmark. Nobody gives a f*** about that. It’s DIRECTIONAL. That’s all that ever concerns the stock market. Which way are we going and at what speed? 

Well, on a vaccine approval, we’re getting our lives back and all the activity around you is going up. And the speed will be breakneck. We just need to get through the air pockets between now and then.

Source:

Johnson & Johnson reaches deal with U.S. for 100 million doses of coronavirus vaccine at more than $1 billion (CNBC)

Pictures from Pixabay.





Wall Street Banks that Got the Biggest Fed Bailouts Have Been Dogs to Shareholders Over the Past 15 Years

Courtesy of Pam Martens

Stock price performance of Bank of America (BAC), Morgan Stanley (MS), Citigroup (C) versus the S&P 500 from January 3, 2005 (the first trading day in 2005) to August 4, 2020.

Stock price performance of Bank of America, Morgan Stanley and Citigroup Since January 2, 2020.

By Pam Martens and Russ Martens

Federal Reserve Chairman Jerome Powell wants Americans to believe that the mega banks on Wall Street that hold trillions of dollars in federally-insured deposits, while peddling everything from high-risk derivatives to junk bonds to precious metals, “are a source of strength” during this economic downturn. The big problem for the Fed is the above two charts.

The chart data comes from BigCharts at MarketWatch, owned by Dow Jones & Company. According to the first chart, Citigroup has lost 90 percent of its share value since January 3, 2005. (It dressed up its share price in 2011, doing a 10-for-1 reverse stock split, meaning shareholders who had previously owned 100 shares, now owned just 10 shares at a higher price.)

Bank of America’s share price has lost half of its value and Morgan Stanley’s share price has been essentially flat for a decade and a half. Compare that to the Standard & Poor’s 500 (SPX) which is up more than 150 percent.

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Dawg on the Wall

 

Dawg on the Wall

Courtesy of Scott Galloway at No Mercy/No Malice@profgalloway 

(originally published July 31, 20)

Since the age of five I’ve enjoyed peeing outdoors. Forty years later, peeing has become something I must do several dozen times a day, and I don’t like the outdoors. But life mimics math, and the product of two negatives is a positive. More math: grilled cheese or tomato soup as individuals I find boring. But together, they’re my favorite thing at the Crosby Hotel bar. God, I miss eating at bars alone, with strangers around me. 

I’m staying alone in Montauk at a friend’s house while he’s in Portugal (something about taxes and quality of life). After my morning coffee and power shake, it’s time to water the plants. Look, it's a bayberry plant, and there’s a crape myrtle. I hear something and startle. I just came from Montana, where everyone tells you to be mindful of bears. My fear escalates to DEFCON 2 when I see not a bear but five men standing in the backyard witnessing my divertissement. Four of them are wearing cargo shorts and could be quadruplets. The fifth is in a suit. The only guy that wears a suit on 92-degree Saturday morning is a real estate broker. Now I remember, the broker is showing the house this morning. 

They act like my Vizsla when she’s done something wrong: freeze in their tracks and avoid eye contact. Who would blame them.

The smartest and most noble


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Disruption Is Good! …Nasdaq 20,000…The Seeds Are Being Planted At An Accelerating Pace.

 

Disruption Is Good! …Nasdaq 20,000…The Seeds Are Being Planted At An Accelerating Pace.

Courtesy of Howard Lindzon

If I woke up from a 2020 Coma today and you showed me a chart of the Nasdaq I would have guessed that Apple cured cancer. It turns out Eastman Kodak was hired to cure COVID.

If I woke up from a Coma today and you showed me the headlines of 2020 and asked where the Nasdaq would be I would guess 4,000.

Here are the indexes this year (I substituted Nasdaq 100 for the Nasdaq which is 90 percent of what interests me day to day and now up 27 percent year to date):

This is why I love investing. You have to go beyond the headlines and noise and position for the future.

I was very confident we would see Nasdaq 10,000 the last 5 years, but the road to get here was not smooth.

The seeds for Nasdaq 20,000 and beyond are being planted at an accelerating pace post the COVID-19 outbreak. March was horrifying and the news does not seem to be getting any better. But, the bad news does not show up in the pitch decks I am getting the last few months.

The difficulties to be faced in hiring, training, motivating and executing in a COVID-19 world are now being thought through more clearly and there is data that is encouraging some incredible people to begin again.

I mentioned a couple weeks ago on this blog that the decks and pitches I was receiving were amazingly good the last couple of months and the quality is still improving.

It makes sense to me.

Great people with great careers at great companies that have great visions would rather start fresh than work inside even the best organizations that have to deal with the hiring, training, motivating and executing (at scale) of hundreds and thousands of people.

A great salesperson, recruiter, marketer etc will look much different in a zoom world than a face to face world. People are moving and the money is now moving quickly as well.

In 1987 the adage we traders and investors thought was cool was ‘Greed…
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President Trump Exclusive Interview

 

Here's Trump's interview with Axios National Political Correspondent, Jonathan Swan, in case you missed it. Topics include COVID-19, COVID testing, Black Lives Matter, the November election, U.S. Foreign Policy and more.

Watch: AXIOS on HBO: President Trump Exclusive Interview:

 

For a handy fact-check of Trump's statements, read Seth Abramson's twitter feed: 

 





Yes, most workers can collect more in coronavirus unemployment than they earn – but that doesn’t mean Congress should cut the $600 supplement

 

Yes, most workers can collect more in coronavirus unemployment than they earn – but that doesn't mean Congress should cut the $600 supplement

The $600 federal jobless benefit expired on July 31. Joe Raedle/Getty Images

Courtesy of David Salkever, University of Maryland, Baltimore County

Americans who lost their jobs because of the pandemic had been getting a US$600 bump on top of state benefits in their weekly unemployment checks since March. That ended on July 31, and lawmakers are debating whether to extend the program and if so by how much.

Senate Republicans are arguing it’s too generous to the 18 million who are unemployed and serves as a disincentive to returning to work. Their initial proposal in the ongoing negotiations would slash the benefit to $200 a week.

As an empirical economist, I wanted to see if their concerns about the disincentive were valid. So I analyzed data on earnings and unemployment benefits to estimate the share of benefit-eligible workers who could collect more on the dole than on the job.

Replacement wages

I started my analysis by looking at 2019 Current Population Survey data to estimate weekly earnings of private-sector employees, both nationally and state by state. I then adjusted the numbers for wage inflation and compared the results with jobless benefits and “replacement wages,” which vary from state to state.

Iowa is the most generous and replaces 49% of a worker’s weekly wages with a cash benefit when he or she loses a job involuntarily, while Alaska is the stingiest and replaces only 28% of income. I estimated that on average the replacement rate for all workers in the U.S. was about a third.

Once the $600 federal supplement is added in, the national average wage replacement rate soars to 127%. On an individual basis, I found that 56% of eligible workers would receive more in benefits than they would earn gainfully employed. Among those workers, the average excess benefit was $253.

This figure also varies in each state, depending on replacement rates as well as average weekly earnings. For example, benefits exceed their earnings for little more than a…
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Valuation since the late 1990′s – win any argument with your friends!

 

Valuation since the late 1990’s – win any argument with your friends!

Courtesy of 

JPMorgan Asset Management’s new On The Minds of Investors piece takes a look at “framing”, a behavioral bias that affects our judgments about market prices. Where you choose to start counting from will have a big impact on how you feel and what arguments will appeal to you.

For instance:

What level of returns should we expect from equity markets? The answer changes depending on the time period – when investors allow an incomplete picture to influence their decisions, it is an example of framing. While it appeared the market had climbed to untenable highs post-GFC (Exhibit 1), if we take a slightly longer view, the overall market return was actually flat between 2000 and 2012. During that time period, the market had an average annual total return of 0.6% per year and a cumulative total return of 6.8% – effectively a sideways market.

JPM’s Samantha Azzarello notes that if you were simply move the frame and look at returns from March 2009-March 2020, you’d see 18.5% annually for the S&P 500, a remarkable run compressed into that 11 year period of time – the opposite of the 2000-2012 experience.

So here’s our Chart o’ the Day for today:

Josh here – beside the framing issue, which allows you to win any argument with your friends that you’d like (it’s run too far! No, it’s got room!) what I find most interesting is the wide variety of market multiples since I began investing and trading in the late 1990’s.

I’ve seen forward PE’s for the S&P 500 range from a high of 27 early in my career to a low of 10! Which tells you that even if you could guess at the earnings of the market a year ahead of time, it would be impossible to figure out exactly what price multiple your fellow investors will put on that earnings number through the process of their buying and selling. And it’s not as though you could actually guess the earnings number anyway.

So now imagine how hard it is to calculate a year-end forecast, with those two variables sloshing around all year, one based on changing fundamentals and the other based on changing sentiment. Cannot be done!

Source:

Framing: How do investors interpret equity market returns over time? (JPMorgan Asset Management) 

 





 
 
 

Phil's Favorites

Beirut explosion: the disaster was exceptional but events leading up to it were not - researchers

 

Beirut explosion: the disaster was exceptional but events leading up to it were not – researchers

A trade in waste flows from Europe to Asia. Avigator Fortuner/Shutterstock

Courtesy of Scott Edwards, University of Bristol and Christian Bueger, University of Copenhagen

At the time of writing at least 100 people have lost their lives and a further 4,000 have been wounded following an ...



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Zero Hedge

Florida COVID-19 Cases Top 500,000; NYC Sets Up "Check Points" For Travelers: Live Updates

Courtesy of ZeroHedge View original post here.

Summary:

  • Florida cases top 500k
  • NYC institutes "check points" for travelers
  • Chicago public schools to reopen online only this fall
  • UK invests $18mil in Scottish vax factory
  • JNJ strikes huge vax deal with White House
  • COVID deaths top 700k
  • US to send DHHS Secretary Alex Azar on historic visit to Taiwan
  • Czech Republic reports biggest jump in ...


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The Technical Traders

Walk Through the Gold and Silver Charts to See What to Expect

Courtesy of Technical Traders

Check out the analysis of this morning’s Gold and Silver charts by our own Chris Vermeulen, Chief Market Strategist and Founder of TheTechnicalTraders.com, to see what is in store for precious metals. Make sure you check out our Gold and Silver article from August 4th, 2020 for additional context behind our predictions and rationale for continued price appreciation.

Learn more about our ...



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Biotech/COVID-19

What the huge COVID-19 testing undercount in the US means

 

What the huge COVID-19 testing undercount in the US means

Health care workers use a nasal swab to test a person for COVID-19 in Pembroke Park, Florida. Joe Raedle / Getty Images News

Courtesy of Melissa Hawkins, American University

Researchers from the Centers for Disease Control and Prevention and other institutions recently published a study which estimated that the true number of people infected by COVID-19 could be six to 24 times high...



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ValueWalk

Beyond Meat Has Not Disclosed Its Environmental Effects

By Jacob Wolinsky. Originally published at ValueWalk.

A recent S&P Global Market Intelligence Trucost analysis found that Beyond Meat Inc., the maker of plant-based meat alternatives, has not disclosed the full extent of its environmental impacts. This includes the amount of greenhouse gases emitted or the volume of water discharged.

Q2 2020 hedge fund letters, conferences and more

Beyond Meat Has "0" Disclosure Of Environmental Impacts

Key insights from the analysis include:

  • Beyond Meat’s weighted environmental disclosure ratio, which shows what percentage of its environmental impacts it discloses...


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Kimble Charting Solutions

Is the US Dollar Nearing Bottom? Or Is It Different This Time?

Courtesy of Chris Kimble

The U.S. Dollar ran into a perfect storm in 2020: a pandemic (Coronavirus), an easy Federal Reserve, and trillions of dollars in government stimulus.

The result has been a steep decline in the greenback.

Looking at today’s chart, however, suggests that the US Dollar may be nearing a bottom. That is if recent history proves true.

The Dollar is testing its 9-year bullish up-trend support at (1) and US Dollar bulls are disappearing. In fact, investors are the least bullish the US Dollars (20% bulls) since 2011 at (2). Notice that each ...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Sunday, 29 March 2020, 07:00:37 PM

Click for popup. Clear your browser cache if image is not showing.


Comment: Silver Shorts Are In a Bind | Ted Butler youtu.be/qQc0AoJp-Q8



Date Found: Monday, 30 March 2020, 05:21:45 PM

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Comment: 5 Questions From You for Luke Gromen youtu.be/nVZD_fuxbQE


...

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Digital Currencies

Twitter Says "Human Error" And "Spear-Phishing Attack" Responsible For Massive Bitcoin Hack

Courtesy of ZeroHedge

Twitter suffered from a major hack about two weeks ago and has now said that its staff was tricked by "spear-phishing", which is a targeted attack to trick people into simply handing out their passwords. 

Twitter staff were targeted through their phones, according to a new report from the BBC. The attacks then allowed hackers the ability to Tweet from celebrity Twitter accounts. Twitter has said it was "taking a hard look" at how it could improve its permissions and processes.

"The attack on July 15, 2020, targeted a small number of employees through a phone spear phishing attack. This attack relied on ...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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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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