Thanks for you guidance – Your "student" will be passing on the McMuffins and having Lobster dinners tonight!
Aquila
Phil, I have to hand it to you. It seemed that you were the only person on the planet that thought stocks falling was still possible. I am glad I listened. About the end of the year I was really beginning to second guess though. Thanks for suggesting taking some profits last Nov. It no longer looks like I missed much.
rj_jarboe
Simply the best blogger with the greatest group of members a person could surround himself with on trading day. I've been trading for quite some time now and the insights & suggestions offered by Phil and the members keep me on a continuous learning cycle.
DDay
I have been very fortunate over the years as an investor. Last year was on of my best in terms of percentage gains. I have to attribute much of this success to my membership in PSW which gave me the best education available anywhere when it comes to the understanding of option trading , discipline and general trading strategies. I will be forever grateful to Phil and the many "highly skilled" traders that have offered their advice.
Gel1
I have been a member for over six years and I still learn something new every day. This site gives you the skills to trade without having to be spoon fed. More importantly it teaches you about risk which is WAY more important than profit. Honestly, it is not a get rich quick scheme!
Malsg
I've been trading/investing since the early 80's (my dad started me out young). I've had seven figure accounts (in the past) and I've done lots of trading, so I can say that I'm a well seasoned investor. Phil is the real deal. His trades make sense and his strategy is sound. He sees things that others miss and he's one of the best at finding price anomalies. When he makes a mistake, he has an exit strategy already planned. He hedges very well and he has an instict which tells him to go to cash or to be all in.
Autolander
Phil.... I remember back in March of '09, you stated " Unless you think the country is going to hell in a hand-basket, NOW is the time to do your buying". Do you remember ? I took your advice, and bought leap $2.00 calls on F, approximately 200,000 shares using the options, for just pennies. Now that was the best Ford I ever owned.... made over $1 mil - thanks go to you Phil. I now drive a Mercedes but still "love" the Ford.
1234Gel
Way to go Phil! Have I said how much I appreciate your site lately! Your ability to teach and your willingless to give others a forum to demonstrate their own skill sets makes your site remarkable. I got great help from you, jmm1951, and Iflantheman (special thanks!) today. Hell, if I have many more days like this I may even be able to sign up for a full year rather than doing it just quarterly. Tomorrow is another day but, fabulous job today!
dclark41
Phil: Thank You! Scaling, Scaling, and Scaling… then patience, patience, patience I'm 2 to 1 short and even on a day the broad market is up I had my largest one day gain in years. The last 6 weeks in fact have been great. I really feel I've learned to use some tools that will enable me to deal with the turbulence ahead. Selling short calls is definitely my preferred approach. Even allowed me to play golf this afternoon while the premium melted away and shoot a career low round. I owe you man!
Lincoln
I am struck by several things over the last few days. First is how level-headed we all are as Greece and China develop. Second is how very helpful it is to see the different trading styles we have, partly because of personal preference and partly because of different stages of development and education. It's very helpful. Well-done, Phil, to have developed this community.
Snow
Brilliant covering of the arcane, the profane , but never the mundane! Easy to understand the reason for your huge following, Phil, and why you have become a must read on my daily agenda. Please accept my complete appreciation.
Seeking Truth
Its been a "perfect" month. Every stock I wrote calls against looks like it will be called away next week, every put I wrote will expire worthless. Thanks Phil, now I need some new buy/write candidates, or the new 100K portfolio….
Barfinger
Phil - I celebrate today, having reached my goal for the year, trading in sync with your education and guidance, of 1 million in profit. I learned a lot, achieved much, and am profoundly grateful. To be honest, when I set the goal I thought it was daunting, as I have for many years been an investor in equities but did very little with options. Learning and doing has for me been a blast! I reached my goal by following Phil's strategies - lots of Buy/Writes, covered calls on equities , naked put entries for income production. I did it with 2.5 mil and kept 600,000 in cash in case I got in trouble. I concentrated on stocks (many of my own choosing) that had decent dividends and wrote front month calls against (OTM) which has worked well in this market run. 25% of my gain is in dividends and premium selling, with the balance in appreciation.
Gel1
Hey Phil, You called all the trends and market movements with perfection this week. I enjoyed it! Thanks for keeping us sane!
GClay
You guys gotta give it to phil–the voice of reason yesterday, last nite and this morning.
Corleone
I have been here a year, and made most of my money back from the 14K fall. The people here are more than willing to help whe Phil cannot get to it. FWIW - This site is my brokerage firm, I was with Wells Fargo Portfolio and it was costing a fortune to trade, the costs here are more than offset with the data, trade ideas and profits you should make.. and I get a chuckle out of Cap and Phil's rantings on healtcare, guns, oh, yeah, and government….
Pharmboy
All I can say is — I understand that the Universe sent me to PSW for a reason. So, I'm listening!! …and studying. Your commentary is literally outstanding. …and your members are impressive as well.
Seaquill
Phil, thank you for the thorough response(s). I joined this group last week to take my education to the next level. the school i am involved with very good at calling out levels but very little live trading and little help in managing a position going against you. I like the combo of knowing where the major levels are coupled with your approach to getting in. learned a lot this week. thank you!
DawnR
Phil: UNH, hedged stock position, doing great, up over 50 %,
RMM
Phil - I just referred 10 people. Last week was a 50% gainer for me. There are companies that want to sell mentoring service for thousands of dollars. This is far better of a deal with very good advice.
Steve
In options trading, one must remain flexible with the ability to adjust to take advantage of the unexpected moves in the market. It is like chess - spend most of your time strategizing the next move. A good understanding of options is necessary to change direction and make adjustments as the market moves against you. I have a friend that honed his option skills while a member of Phil's elite membership over a period of two years. With the education acquired, he made over $2 Mil in that period, trading options and following the plays put on by Phil. If making money is your goal, then he is the go-to guy, as he knows option strategies better than anyone, and market timing is also a skill he has mastered.
1234gel
I did the same thing via your logic (sold puts that is). I glanced one time and they were already up 15% which is considered a good return for an overnight hold in most circles. This is PSW though and to us it's just another day…
Kwan
Started my membership in mid-Oct and have since then learned so much about options by reading the site's articles and postings, members' chats and suggested trades – as a bonus, the articles are entertaining as well! Phil's long-term investing strategy makes really good sense as I've seen its effect on my GLW positions. Phil – thanks for sharing your knowledge of the market! I've worked as risk analyst for the investment dept of a $19B insurance company, and the scope and depth of your daily commentaries blows away what I have seen and heard from the PMs and even the chief investment officer! Most of all, I will continue to be a member because you have your priorities right (from my POV) – it's not all about money and power.
Bai2r
Phil, thank you for all the education here. I've gained so much knowledge being a part of PSW. Thanks to the rest of the members as well! I appreciate all of the contributions you make.
JeffDoc
Joined last year and and started profitably trading options thanks to everything I have learned here. THANK YOU!!
OnWisconsin
Phil – In the event of a mkt meltdown, which of the indices, in your opinion do you think has the most potential for % move down. I'm looking at call options on SDS and the DXD. Any thoughts? Ideas? Thanks .. and thanks for being a great teacher! I've learned so much in only a month!
Louis631
I think that Phil is super, I am up 39.3% YTD. Thank you for your kindness and the opportunity to observe Phil from February.
KMisko
Here I have learned and look differently at things. Over the years being with PSW I have first of all learned and gained in knowledge of trading. This to me is one of the biggest gains. I still remember the play on Caesar Palace, paid my trip to Atlanta!
Yodi
I am a Registered Nurse, so is my wife. We work hard to take care of seven kids that are the joy of our lives. The cost for a basic membership is ALOT from our our monthly budget of spending and saving…but well worth it! Phil has allowed me to really ramp up the savings we put away for our children's college funds and our retirement.
David
Phil/CL-that play made a quick $500 per contract! Took all of 10 minutes! I want to thank you for helping me not just learn a bit about trading, but giving me some confidence and most of all a rewarding "hobby" to look forward to each day. I have had a few mistakes and losses along the way, but I have had some great wins too and I am now consistently making money trading futures and have even learned to go to sleep while holding a losing position knowing that tomorrow is always another opportunity to win again. So thanks again for your help and patience along the way.
Craigsa620
by ilene - November 24th, 2009 11:37 pm
Courtesy of Jesse’s Café Américain
The increase in the monetary base created by the Fed’s monetization of debt is striking, not seen since the early stages of the Great Depression.
[click on charts for larger views]
Banks are not lending despite the massive quantitative easing. They are fat with reserves, paying huge bonuses again, and obviously doing something with their money other than providing funds for the commercial activity of the nation.
Excess Reserves are an accounting function. The banks themselves do not reduce their reserves significantly through lending in the aggregate, but seek to minimize the opportunity cost of reserves. But it is symptomatic in the sense that the lack of reserves is most definitely NOT an issue with lending.
No one can deny with any credibility that if the Federal Reserve reduced their payment on reserves to zero, or even a negative, that lending activity would not increase. And yet they do not. Why?
Because the first priority of the Fed is the health of the banking system itself, and not the national economy and the availability of credit to non-banking institutions. They are seeking to drive commercial entities out of secure savings to risk investment again, but providing a safe harbor for the banks while they are doing it, while attempting to maintain the appearance of financial system solvency.
The critical, unspoken factor is that the US banking system is not yet healthy, is not sound, is not well capitalized despite the record expansion in the monetary base and its specific direction to the banks themselves. They have simply not taken the writedown necessary to make themselves financially sound, because they do not wish to take the hit to earnings, salaries, stock options and bonuses.
Ben Bernanke’s gambit is as much financial fraud as it is a monetarist exerperiment in cynicism with regard to the management of a nation’s money.
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by ilene - October 11th, 2009 8:00 pm
Courtesy of Jesse’s Café Américain
As part of their program of ‘quantitative easing’ which is another name for currency devaluation through extraordinary expansion of the monetary base, the Fed has very obviously created an inflationary bubble in the US equity market.
Why has this happened? Because with a monetary expansion intended to help cure an credit bubble crisis that is not accompanied by significant financial market reform, systemic rebalancing, and government programs to cure and correct past abuses of the productive economy through financial engineering, the hot money given by the Fed and Treasury to the banking system will NOT flow into the real economy, but instead will seek high beta returns in financial assets.
Why lend to the real economy when one can achieve guaranteed returns from the Fed, and much greater returns in the speculative markets if one has the right ‘connections?’
The monetary stimulus of the Fed and the Treasury to help the economy is similar to relief aid sent to a suffering Third World country. It is intercepted and seized by a despotic regime and allocated to its local warlords, with very little going to help the people.
Deflation
By far this presents the most compelling case for a deflationary episode. As the money that is created flows into financial assets, it is ‘taxed’ by Wall Street which takes a disproportionately large share in the form of fees and bonuses, and what are likely to be extra-legal trading profits.
If the monetary stimulus is subsequently dissipated as the asset bubble collapses, except that which remains in the hands of the few, it leaves the real economy in a relatively poorer condition to produce real savings and wealth than it had been before. This is because the outsized financial sector continues to sap the vitality from the productive economy, to drag it down, to drain it of needed attention and policy focus.
At the heart of it, quantitative easing that is not part of an overall program to reform, regulate, and renew the system to change and correct the elements that caused the crisis in the first place, is nothing more than a Ponzi scheme. The optimal time to reform the system was with the collapse of…
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by ilene - October 6th, 2009 1:26 pm
Here’s another installment in the debate between our friends Mish (Global Economic Trend Analysis) and Karl (The Market Ticker). Confession – as a big fan of both Mish and Karl, each makes good arguments, I’m currently undecided. What do you think? Don’t forget, we have a comment section. 
Ilene
Courtesy of Karl Denninger at The Market Ticker
I am occasionally stunned when someone who I thought had a good grasp of reality and reason goes entirely off into left field, powered by a thesis that has run out of track.
Mish, unfortunately, has succumbed to this sin in his piece "Fractional Reserve Lending Constitutes Fraud"
He alleges (after waving his arms around):
Fractional Reserve Lending constitutes fraud. The case is irrefutable.
Bluntly: Bullshit.
Let us distinguish between two separate items: Money and Credit.
We shall first define them:
Mish’s (and others) claim that "all fractional lending is fraudulent" implies that one cannot pledge money to secure credit.
That’s obvious BS; let’s put forward a concrete example.
I walk into the forest (grow) and cut down trees (mine) which I then process into lumber (manufacture.) I dig up some iron ore (mine) and turn it into steel nails (manufacture.) With these two items I now construct a house (manufacture.)
That house (and all the products that I used to make it) are in fact money. They were the product of mining, growing, and/or manufacturing. Each of these acts is in fact the creation of money.
That house, has a representation of money in its utility value. That is, the shelter value that it has for a group of humans – it provides a place to eat, sleep, take a dump and
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by ilene - September 29th, 2009 3:04 am
By EB, courtesy of Zero Hedge
The Financial Times recently reported on the Fed’s latest exit strategy to eventually contain the inflation zombie:
During the crisis, the Fed created roughly $800bn of additional bank reserves to finance asset purchases and loans. This total is likely to rise in the coming months as the central bank completes its asset purchases and the Treasury unwinds financing it provided to the Fed. Fed officials think they could raise interest rates even with this excess supply of reserves by offering to pay banks to deposit their surplus funds with it rather than lend them out. However, they also want to use reverse repos in tandem to soak up some of the excess reserves. Policymakers call this a “belt and braces approach”. [The latter, clearly a nod to the great Gekko.]
TD touched on this last Thursday, and we will expand upon it here as it is particularly relevant to our ongoing theory that it is the proceeds from permanent open market operations (POMOs) and their close cousins that are driving equities. Though this may be received wisdom to ZH readers, the Fed has done us the favor of providing additional evidence through the FT story. A bit of background, as we are new contributors to this forum:
Money Supply: Based on our previous research on the effects of swings in M2 non-seasonally adjusted money supply (M2) on the stock market, we were a bit surprised in July 09 by the resiliency of the rally, which continued in the face of such a dramatic contraction in M2. The dismal Durable Goods report from last Friday confirms that the capital goods sector is still under significant pressure as a result of a lack of money in the general economy. With banks not lending to normal businesses and consumer credit contracting equally as violently, what is the basis for this rally and from where does the never-ending flow of equities juice flow?
Bank Non-Borrowed Excess Reserves: The Fed statistic that most closely correlates with the 2009 equities run-up appears to be bank non-borrowed excess reserves (bank NBER), which
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by Chart School - September 28th, 2009 5:44 pm
Courtesy of Andy Kessler
This chart ran along with The Bernanke Market piece that ran in the Wall Street Journal back in July. I thought it was worth updating. The market seems to be following the Fed’s money creation. I suspect the market will give out well before the Fed stops printing money.
The monetary base data is from this page at the St. Louis Fed. WSBASE is defined as the "Sum of currency in circulation, reserve balances with Federal Reserve Banks, and service-related adjustments to compensate for float."
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by ilene - September 28th, 2009 2:02 pm
Courtesy of Andy Kessler
This chart ran along with The Bernanke Market piece that ran in the Wall Street Journal back in July. I thought it was worth updating. The market seems to be following the Fed’s money creation. I suspect the market will give out well before the Fed stops printing money.
The monetary base data is from this page at the St. Louis Fed. WSBASE is defined as the "Sum of currency in circulation, reserve balances with Federal Reserve Banks, and service-related adjustments to compensate for float."
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by ilene - July 15th, 2009 12:02 pm
Andy Kessler may have the answer to why the market keeps going up, even in the face of enduring economic pain (if you look beyond the ever rising indexes).
Courtesy of Andy Kessler
http://online.wsj.com/article/SB124762005061042587.html
I remember once buying the stock of a small company and I couldn’t believe my luck. Every time my fund bought more shares the stock would go up. So we bought even more and the stock kept climbing. When we finally built our full position and stopped buying the stock started dropping, ending up at a price below where we started buying it. We were the market.
Just about every policy move to right the U.S. economy after the subprime sinking of the banking system has been a bust. We saved Bear Stearns. We let Lehman Brothers go. We forced Merrill Lynch, Wachovia and Washington Mutual into the hands of others. We took control of Fannie and Freddie and AIG and even own a few car companies, pumping them with high-test transfusions. None of this really helped.
![[Commentary] the dow tracks the money supply](http://s.wsj.net/public/resources/images/OB-EB397_kessle_DV_20090714220524.jpg "[Commentary]")
We have a zero interest-rate policy. We guaranteed bank debt. We set up the Troubled Asset Relief Program (TARP) to buy toxic mortgage assets off bank balance sheets. But when banks refused to sell at fire sale prices, we just gave them the money instead. Dumb move. So we set up the Public-Private Investment Program to get private investors to buy these same toxic assets with government leverage, and still there are few sellers. Meanwhile, the $1 trillion federal deficit is crowding out private investment and the porky $787 billion stimulus hasn’t translated into growth.
At the end of the day, only one thing has worked — flooding the market with dollars. By buying U.S. Treasuries and mortgages to increase the monetary base by $1 trillion, Fed Chairman Ben Bernanke didn’t put money directly into the stock market but he didn’t have to. With nowhere else to go, except maybe commodities, inflows into the stock market have been on a tear. Stock and bond funds saw net inflows of close to $150 billion since January. The dollars he cranked out didn’t go into the hard economy, but instead into tradable assets. In other words, Ben Bernanke has been the market.
The good news is that Mr. Bernanke got the major banks, except for Citigroup,
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September 17th, 2021 8:54 pm
Jumping the SPAC
Courtesy of Scott Galloway, No Mercy/No Malice, @profgalloway
Note: I was not under influence of Zacapa or edibles writing this one … so it’s wonky. Oh well, my blog.
A perfect storm may be brewing: tech, software as a service (SaaS), and climate change. My podcast co-host, Kara Swisher, believes the first trillionaire will be an entrepreneur who addresses climate change. It’s not unthinkable, as Elon Musk is already 15% of the way there — to a trillion in wealth, not solving climate change. I’m more skeptical and believe the only entities that can begin to reverse climate change are the EU and the governmen...
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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