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Philstockworld September Portfolio Review
$1,204,322!
That is DOWN $190,405 but still up over 100% for the year. We have a very large, very volatile bet on Tesla (TSLA) that we're riding out and that let both to last month's huge gain and this month's huge loss but last month showed us the massive potential the position has as it's currently net -$881,087 so, if TSLA ends up between $300 and $380 in January (now $450), we stand to almost double our entire portfolio on that one position.
I was going to say I don't like the super-volatile positions but that's not true – I do like them as we're selling TONS of premium to people who think stocks go up or down forever and have no rules but I DON'T like them in margin-limited portfolio or in portfolios that aren't miles ahead and can afford to take chances. Not only can we afford to take a chance this year but we're also locking in our 100% gains using TSLA as it pays us almost as much to the downside ($881,087) as our entire Long-Term Portfolio (LTP) is worth ($1,043,965)!
But, spoilers, let's just take a look at where we stand and move on from there. As we expected, the Fed and Congress have fired their stimulus guns this week and the reaction from the market has been a big shrug as evidenced by the shouldering down move in the S&P 500 this week:
While that's going on, Donald Trump's victim count is hitting 200,000 but that's nothing compared to what we're about to see as our kids finish their second week at school as two weeks is just about the time when it's already too late and local Governments realize what a huge mistake re-opening too early has been. While we know Trump doesn't care about California and New York having 100,000 combined deaths this year, he'll be losing 60,000 voters in Florida and Texas as well.
Early indications are that sending the kids back to school is already becoming a "super-spreader" event for the whole country and 50,000 more Americans will be dead by…
And that moral and intellectual dishonesty is affecting your health, your safety and your portfolio. As much as you KNOW that these networks are lying when they are denying climate change, promoting miracle vaccines or propping up despicable bastards for public office – you have to realize they are ALSO lying to you when they tell you how great the economy is and what to invest in. …
And once again the Futures are up.
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We had a good day yesterday shorting the Dow (
Up and up we go.
How much is 362 x 29M? 10.5Bn – that's more people than there are on the planet potentially affected in the next 6 months. Of course we are, theoretically, doing a better job of containing the spread but by "we", I certainly don't mean America, which is very likely to leap forward in cases…
Well, that went about as expected.
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See how those lines work?
If 2 of the 4 indexes fail their line you can short either the 3rd using the 4th for confirmation or just wait for the 4th to cross and short with confidence and simply stop out if ANY of the indexes get back over the line again. What that does is limit your losses to a good line of resistance without limiting your gains and that means, if you are wrong, you shouldn't lose more than a couple of hundred Dollars but, if you are right, you could gain thousands – that's a good game to play!
Well, that was predictable.
$6,000 per contract!
USO, as you can see, remains on track and the April $35 puts are now $7.80 ($15,600) and the $30 puts are $4.40 ($8,800) and the short Sept $30 puts died last week (Wednesday morning) at 0.75 ($750) so the spread is up about $1,000 (20%) at $6,050 so far. Setting those stops is key as the short puts are now $1.75 – exactly enough to wipe out our…
Wow, what a day!
Chinese banks are under increasing stress.
Non-performing loans in China in June (last published month) were $395Bn and that has exausted the "Bad Loan Coverage Ratio" which was 3% in 2012 and is now sitting at 0.5% (as of June) and falling fast. As part of the pandemic response, China has allowed many borrowers to delay interest and principal payments to March next year, which is hiding the true sense of the bad debt bulge.
WOW!!!
Well, since we clearly know that Steve Mnuchin doesn't give a crap about people, he must mean bad things will happen to his…
How high is too high?
Please just 
With the Fed keeping rates artificially low, my Mother and her friends began to have problems with their retirement accounts.
Yet people are paying it. There's a sucker born every minute but now that they've done a stock…
4 more years of this and we'll need a shopping cart just to carry the money we'll need to buy groceries! Of course, hyperinflation is a great way to pay off your debts as the economy can grow along with inflation (it's just your wages that don't keep up) while the long-term interest rates are fixed, so the money the Government pays back becomes worth less (worthless?) and PRESTO!, debt problem solved!
GDP is coming at 8:30 and it's going to suck.
CNN reported on Wednesday that the CDC guidance change was due to pressure from Trump administration officials, citing an unidentified official. New York Governor Andrew Cuomo called the move “political propaganda” and an effort by President Donald Trump to bring down the number of cases with less testing.
Europe has indeed spent about half of what we've spent on stimulus but they've spent it much more effictively and seem to be getting their virus under control. Japan has spent the most, by far and the Yen is another major currency the Dollar is measured against so why should the Yen be higher against the Dollar? It makes no sense, so the Dollar is probably too weak now and a move back up in the Dollar to 96 will likely knock commodities and stocks down about 5%.
Back to our highs, again.
Virus cases are down.
Of course, the reason the Nasdaq 100 is doing so well is that it is the most concentracted index on FAAMG: Facebook (FB), Amazon (AMZN), Apple (AAPL), Microsoft (MSFT) and Google (GOOGL) – our Trillionaire Corporate Citizens. Those stocks are up 35% for the year, adding $3Tn in market cap in 8 months so, if you're wondering where all that stimuluss money went, look no further than into the stock valuations of our 5 
How good is the economy, really?
We got the Fed's mintues yesterday, they were not helpful.
Officials had a long list of worries about the outlook, ranging from new waves of virus outbreak disrupting growth and crimping credit conditions, to waning fiscal support, as well as disruptions to foreign growth from the pandemic. Importantly, “several” said the long-run impact of the pandemic could result in business restructurings that may “slow the growth of the economy’s productive capacity for some time. Uncertainty is quite high. And I think uncertainty matters a lot for players in the economy and consequently for the economy itself,” said Thomas Barkin, president of the Federal Reserve Bank of Richmond.
21,913,816.
China STILL has under 90,000 cases. They had over 80,000 back in March, when we had only 5 and, since then, they've only had 10% more cases while the US has had 100,088,000,000% more. China was already showing the World how to contain the virus and most of the World paid attention and listened. We essentially did the opposite and now 170,559 American's are dead and that's on this President…
OVER 1/2 of US housholds have lost some income since March.
Here we go again?
While we are off our (mostly) April highs, we still have MASSIVE unemployment and we don't know what the effect of Lockdown II is going to be but, since this report was filed, there have been 
The S&P 500 topped out yesterday at 3,387.
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On Monday, New York’s Democratic Gov. Andrew Cuomo said the unemployment benefits spelled out in Trump’s executive order would cost his state an estimated $4 billion by December. It would add to a budget shortfall that Cuomo said was already $30 billion. “That’s handing a drowning man an anchor,” the Governor said.
Why didn't we think of this before?
5,045,564.
WTF?
8:30 Update: 1.8M jobs were added in July,…
695,000.
MORE FREE MONEY!!!
Most stocks are like that at the moment and so is the entire market. We're irrationally ignoring the the potential downside to a second wave of viral infections and we're still in the middle…
We're still at 11,000 on the Nasdaq.
The deal would land Microsoft the breakout social-media player of this decade. It would give Washington a win over Beijing by bringing a Chinese technology crown jewel under U.S. ownership. For TikTok parent ByteDance it would resolve the national-security concerns that threatened to thwart its U.S. operations. The proposed transaction gained the blessing of senior Trump officials, including Treasury Secretary Steven Mnuchin, who saw value in an American company getting access to sophisticated TikTok algorithms 
$60 Billion!
Wheeee, that was easy money!
Merkel's Germany did everything the Trump Administration did not and the differences are astounding. Rather than spend Trillions of Dollars propping up the economy, they actually protected their people from getting the virus in the first place and are already on the road to recovery while the US virus count and death count are spinning out of control.
Will the Fed save us (again?).
Obviously the money was mainly misdirected and wasted but is that going to change when we give Jared another $500Bn of untraceable funds to play with? What happened to the first $500Bn? Oh yeah, untraceable… Well there was another $500Bn that the Treasury had and that fund was traceable but, at last count, 
$1,000,000,000,000.
The funny thing is the rich people are pissed that they are ONLY getting $1Tn this quarter (they got $6.7Tn last quarter) so the Futures are tanking and we're losing all of Meaningless Monday's gains. The biggest stimulus issue will hit us on Friday, it's the end of the $600 weekly unemployment bonus and the Democrats in the House wanted to extend it through Christmas while the Scrooges in the Senate said not only do they want it dropped to $200 now but they want all unemployment capped at 70% of wages AFTER it's combined with any State Benefits people are receiving.
Democrats have also propose $1Tn in aid to local Governments while the GOP just says no to that and again, they want the cities and states to fight the virus with the same budgets they had when there was…
More free money!!!
Mnuchin (who's father was a general partner at Goldman Sachs and spit out the silver spoon he was born with - demanding a platinum spoon on his way to Yale and a job with, you guessed it, Goldman Sach after which he took part in the total destruction of Sears, where they looted the pension and cost millions of workers their jobs while getting rich of the real estate they sold out from under the investors' noses) says 70% of minimum wage should be the cap for those lazy bastards who aren't risking their lives to go back to their closed businesses.
While the House plan included $1Tn in aid to state and local Governments, the Senate plan has none. With so many areas shut down, tax revenues have gone down sharply and this funding was meant to help deal with that shortfall so expect this to…
Wheeeee, what fun!
It's also the way it was in February, March, April, May and June but better late than never, on July 21st, in taking the most simple precaution against the rampant spread of a virus that has now killed 142,073 Americans (twice as many as died in the 20-year Vietnam war) and infected, by tomorrow, 4M others. Last night was the first "daily" briefing on the virus since April, when Trump decided Dr. Fauci was upstaging him and, even worse, contradicting him. At the time, the US had less than 1M cases.
Happy 11,000!
Yes, we still have the virus.
Remember the virus?
We're still a good 6 months away from a proper vaccine roll-out, even if everything goes perfectly and the Global Economy is still severely damaged so of course this is a massive over-reaction but it's better than no vaccine, right?
Wheee, what fun!
Has it been four months?
Buckle up, it's going to be a bumpy ride!
Winning!
That is why we need to "flatten the curve". The US already has one of the worst-performing Health Care systems in the World and this is a stress test we are clearly failing. “It’s been chaos for us,” .jpg)
It's been a while since we had a 
The highest batting average in baseball history was Ty Cobb, who battet 0.367 but, because he didn't swing at pitches he didn't like, he also walked a lot and his "On Base Percentage" (times he got to first base) was an amazing 0.433 – almost half the time he got up, he got on base! Being selective in your trades will also get you to first base (profits!) much more often but that, unfortunately, means there are certain times – or UNcertain times like these – when you are better off not swinging at all.
If it's Tuesday we must be testing the 10% line.
Another day another 1.5% gain.
The Atlanta Fed has increased their GDP Now Forecast to -35% from -54% for Q2 so I guess that's great news. I'm not sure if -35% deserves new record highs in the stock market but it is certainly better than -54% thanks to that very clever re-opening thing we've been doing for the past month under the guidance of Supreme Leader Donald Trump.
50,000 new infections!
From Japan and other countries that have had re-infections, 
The US "is not in total control".
Nice move up yesterday, this is a good time to take a look at the Short-Term Portfolio (STP).
The economy is still very much shut-down and yesterday the markets were excited about some production growth in Asia but, when you were down 30%, growing 2% back is not really a reason to put on party hats – certainly not a 500-point rally. But that brings us to the TREMENDOUS amounts of stimulus in the economy.
So, the question is, are we hedged enough or CAN WE BE HEDGED ENOUGH to protect our long positions? Our Long-Term Portfolio is up 70% at the monet at about $850,000 and our Short-Term Portfolio is up 445% at $545,000 so combined $1.395M is more than a double off our $600,000 combined start so all is well but that's because we got lucky and were bearish into the crash (
I guess people ignore stuff all the time.
Holy cow!
This is getting interesting.
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So now the market has dropped 20% and what do you have? You have $92,000 – that's only down 8%. That in itself isn't very exciting but that's where Part 2 of our strategy comes in because, since we are not very damaged by a 20% drop, we are in a great position to go bargain hunting for stocks that over-reacted to the downside (and that is what our Watch List is for) and now we can buy our stocks for a 20% or greater discount and, using our other options strategies and taking advantage of the higher VIX – we can buy stocks closer to a 40% discount with our $92,000 in buying power.
2,347,102 infected Americans.
In 3.5 years, America has become isolated and unloved, with soaring debts and monstrous unemployment. We have far less trade, riots in the streets and our life expectancy is crashing as fast as the stock market is rising. Putin could not possibly be prouder, could he?
Things are looking good so far because those 
Does what you hear about the markets and the economy make sense when you walk on empty streets and eat in empty restaurants? Will it makes sense when we get those quarterly reports for Q2? Does it make sense when you look at the Atlanta Fed's GDP Now forecast, that shows Q2 (the one we just finishing next week) GDP is projected to be DOWN 45.5%.
Bolton's book is out.
Wheeee, what a ride!
The Atlanta Fed's GDPNow Tracker still has the 2nd quarter coming in at a 50% contraction to Q1 so, logically, Corporate Profits are going to be headed that way as well yet you wouldn't have known that from the record highs we were setting last week. It was obviously ridiculous and that is why our Short-Term Portfolio, where we manage our hedges for our long portfolios, gained $50,000 last week!
Wheeeeee!
Wheeeee – down we go!
You've got to short the Nasdaq at the 10,000 line!
Keep in mind that stocks are an alternative to bonds and, since bonds are paying less than 2%, what is 50 times earnings but a 2% annualized return. While stocks are risky, there's also a chance the stock becomes more valuable over time and stocks make a better hedge against inflation as Corporate Profits are likely to inflate along with everything else.
The Food Bank provides 21M meals per quarter and the US Government has dropped $2.7Tn (so far) in direct stimulus which has (so far) made 
We're waiting on Payroll Data.
That's why this jobs report tells you nothing about the real health of the economy. It's a fiction that's been concocted by the Government so the people are not generally aware of how hard-hitting this disaster has been. Yesterday, they were already talking about another $1Tn of stimulus by the end of June – anything to keep Q2 GDP from being down more than 50% – which is the current forecast by the Atlanta Federal Reserve.
3,135.
Yawn!
That's right, the Fed now buys junk bonds and the majority of these ETFs are managed by Blackrock (BLK), who also runs the Fed's debt-buying programs (once again, the Fed is NOT a Government Agency – it is a Banking Cartel made up of Bankers to protect the interests of Bankers). Still, even for bankers, this seems a little fishy.
The First Amendment is getting a workout this weekend!
We can only assume that Liquidity Trumps all other things – as does the Oligarchy and that was on full display in this 
This could be the short of a lifetime.
Meanwhile, 
I get it.
You can't make this stuff up.
Mr. Trump publicly embraced hydroxychloroquine as a “game
Nothing happend this weekend.
S&P 2,850.
35M people have lost their jobs in 60 days.
$3,000,000,000,000!
While the Trump Administration is rushing to get the economy opened back up, 
Still, the growth expectations were justified as Corporations no longer have to pay taxes or worry about destroying the environment and, in the golden age of Trump, earnings shot up to $140 per share last year and the S&P hit 3,400 – still with a p/e of 24.28 - as if this growth will go on forever. Why, to keep that kind of growth up you'd have to PAY corporations tax money on top of the profits they make.
Of course, if we are going to be counting on a long-range recovery to justify paying pre-virus prices for stocks that will clearly NOT be making pre-virus money this year – then we should also be taking into account the damage that is being done by the US (and other nations) racking up a $4Tn Deficit in 2020 – and that's ignoring $4Tn added to the Fed's balance sheet and a very likely additional round of stimulus that's coming.
Has it been two months?
Don't ask me to explain this BS.
I don't want to be that guy.
Well, you can see why we call it our "Must Hold Line."
Well this is no surprise.
Trump is officially out of control.
The BEST month!
We have some truly ridiculous gains in our portfolios thanks to this epic bounce and we're coming back to test the 200-day moving average on the S&P at the 3,000 line and we didn't think we'd get back over our Must Hold line at 2,850 but, on the other hand – as I said back on March 24th: "
As investors, we don't really care, FREE MONEY is FREE MONEY…
Will Powell be wearing pants?
The last time I was on the show was March 11th
Cognative Dissonance.
I WAS going to write an upbeat article.
Oil is back over $15.
The ETF is reverse-splitting 1 for 8 as of April 29th, so we'll have to be out by then as it's more likely than not that oil will plunge into negative numbers again at the May, taking USO down with it, no matter what price they reset it too. So far, Trump has offered to buy 75M barrels of oil for the SPR and Trump has attempted to raise hostilities with Iran in attempts to boost the price of oil and it's working somewhat, with oil back to $15 but we just had a 25M barrel build in inventores yesterday so even if they fill the Strategic Petroleum Reserve to the brim – we still can't handle 4 more weeks of build like that!
Another $500Bn is being thrown on the fire.
Republicans had initially wanted only to replenish the small-business fund (which they looted), while Democrats wanted to also boost money for hospitals, testing, food stamps and state and local governments. Although under pressure last week from some centrist Democrats uncomfortable with delaying the small-business aid, Democratic leaders saw several of their requests met in the emerging deal.
$38.50 per barrel.
Still if you are doing the math, you might be able to make all that work for under $38,500 but then you still need to find someone who will buy the oil from you for less than zero and, while -$38.50 did not last long – oil is still trading at -$4 this morning. Those are the contracts that expire today for May delivery as there is simply nowhere left to put the oil.
This actually happened this weekend:
Did I know that a viral pandemic would be the catalyst that would take down the global markets? Of course not, but I did KNOW FOR A FACT that valuations were stretched and we had made a ridiculous amount of money in our Long-Term Portfolio (based on…
It's over.
When will things get back to normal?
Now, unlike many other ghost towns across the world, South Korea’s cities are full of people going about their usual business. Crucially, many are practicing social distancing and almost everyone is wearing face masks. To counter the risk of travelers from abroad spreading the virus, authorities announced on Wednesday strict rules for anyone arriving from abroad, including a mandatory two-week quarantine.
“It’s a make-or-break moment.”
We'll hear more about this at the IMF's annual meeting, which starts tomorrow. At the same time, emerging markets are facing a massive liquidity crisis as they don't have Central Banks that can simply crank up the printing presses when they need to throw money around. Capital has simply flown out of Emerging Markets and is continuing to do so and those are the people who supply a lot of the parts and materials that make American factories run.
We're short.
What does the Fed think?
Are you down 50% one or more of your stocks?
Wheee, that was fun!
Still, we don't want to be greedy so we'll set a stop at $22.50 once 
Wimps!
Why do we listen to these people? When have they ever been right? The same thing happened in 2008 when the people who had the money (the Top 1%) got their bailouts (TARP) and then went about telling the Bottom 99% that the World was going to end and they should dump all their stocks – the same stocks the Top…
What is your plan?
The virus rages on.
85,996!
$4.5 TRILLION!
We still need the House to confirm the bill but let's keep in mind this is only our FIRST bailout package. If things drag on, there will cerainly be others and the way our Government is responding, things are certainly going to drag on. If you wonder what FEMA is doing during this emergency, New York, Hawaii and North Carolina have issued an urgent request to FEMA for emergency mortuary assistance as deaths mount across the states.
MORE FREE MONEY!!!
There's a great article in Bloomberg
I want free money NOW!!!
Hi ho silver!
Trillions of Dollars are being committed to "fix" the economy.
Bloomberg reporters are reporting from their homes – how's that for inspiring confidence!? As I noted this morning in an Alert to our Members:
How low can we go?
After finishing down 2,000 (10%) points on the Dow and 260 (9.55%) on the S&P, this morning the Futures are limit up.
What will it take?
Yet the markets are not doing better at all. Despite yesterday's impressive "rally", we remained firmly on the sidelines as we never even came close to our "Weak Bounce" line at 2,960 and that's not even a recovery until we cross back over the "Strong Bounce" line at 3,070 and hold that for 2 consecutive days.
China's President Xi went to Wuhan this morning.
President Trump stayed safe on the golf course yesterday but made it back in the evening to announce he will seek further tax cuts (duh!) and "very substantial relief" for 
Well, you can't say we didn't see this coming.
Wheeee, this is fun!
Notice we're not playing the Futures this week.
What the Hell were people expecting?
Keep in mind the lunacy that is going on here – we are having emergency G7 meetings led by Steve Mnuchin (a Goldman Sachs Bankster) who is telling the Global Finance Leaders that they must lower rates to prop up the markets BECAUSE THEY ARE 8% below their all-time record highs. Propping up the markets is very expensive and it adds to government debt and it only helps the Top 1%, who own 90% of the stocks – what is the real agenda here?
Warsh agrees with my take that the Fed doesn’t have a lot of ammunition to help markets and the economy, but he thinks that means it needs to act quickly in a coordinated fashion with other Central Banksters like the European Central Bank, the Bank of England, the People’s Bank of China and the Bank of Japan…
Down we go again.
Wheeee – that was fun!
We can go bearish below our lines with the same rules we went bullish with – that's what's fun about the Futures – our stops had us risking very little to make what is already (8:07 am) over $600 per contract – not bad for 97 minutes work!
And, while we don't have the exact figures, I know when I go on a trip, the airfare is generally less than 1/3 of what I spend overall so we can assume another $1Tn of capitalization damage to the travel, entertainment and restaurant sectors so now we're chopping 1.5% off the Global Markets. 
Everything is fine.
Virus, what virus?
The Nasdaq (
Germany looks like they are heading into a Recession and now Japan is at the brink with 
Happy Valentine's Day!
Unfortunately, that's also how viruses work and I'm not going to bore you with any doom and gloom stuff other than to point out that we are heading into a 3-day weekend in the US (President's Day on Monday) and, even if we are only adding 4,000 new cases per day, that means we'll be at about 80,000 on Tuesday and around 100,000 by next Friday so I'm still very concerned about next week – as people tend to freak out about 6-digit numbers.
60,329 infected, 1,369 dead.
45,204 infected, 1,116 dead, 5,085 recovered.
The non-hidden forms of debt have jumped up $50,000,000,000,000 in the past decade and that's another 5% of Global GDP added in debt each year as well so of course it FEELS like we're doing great – just like your children feel like you are doing great when you put a trip to Disneyland on the credit card – it's the time of their lives for them and you have to deal with the bills when you get home.
You know it's true because Tom Cotton has now CHALLENGED "The Chinese" to prove him wrong and, guess what? They haven't! That's certainly guilty enough for me and you, right?
Last week, the markets got a pop on word there was a "cure" (viruses are not cured) and a vaccine (vaccines take months to create and more months to manufacture) in China and both turned out to be BS but, as we have learned in the age of Trump, it doesn't matter if something is true or not – as long as it works. In fact, just this weekend, 
Yet our markets are marching along as if the virus is a one-time thing, even though it's the 4th big one of this century. There was SARS in 2003, H1N1 in 2009 and MERS in 2012. I think that merits at least considering the potential risks going forward, don't you? A 2.5% pullback is all this outbreak warranted on the S&P, not to mention the Impeachment of Donald Trump and the ongoing Boeing Debacle, that's certainly going to put a dent in the US economy, which is only expected to grow 1.5% in Q1, except by the Atlanta Fed, who somehow sees 2.5% suddenly.
Up and up the markets go (again).
Back in China, the PBOC pumped another 400 Billion Yuan ($57Bn) into the banking system through reverse repo operations in extreme emergency measures to keep the markets afloat or, what our own Federal Reserve calls: "Tuesday." Of course China's economy is half our size so it is a very large anount of money – more like a Friday for our Fed…
17,400 infected (
China is trying to stop the slide by stepping in economically, with the PBOC pushing in a massive stimulus measure as well as a cut in the reverse-repo rate to push liquidity back into the system. Apparently, oil demand in China (the World's 2nd largest consumer) was down 20% in January and that will get worse for February as more and more people are in the ever-expanding quarantine zone.
AMZN's stock price is still out of control at $2,085 this morning as their "terrific" earnings were actually just $6.47/share so $23.01 total for 2019 means they are still trading at close to 100x their actual earnings and, on the whole it's barely up from 2018's $19.80/share.
8,000 infections, 170 deaths.
6,000 infections.
4,500 infections.
Hong Kong has 8 virus cases and will be implementing a broad series of restrictions aimed at controlling the spread of the coronavirus by limiting the number of mainland Chinese travelers entering the territory. The restrictions, which included the suspension of high-speed and other train services between Hong Kong and the mainland, a 50 percent reduction in the number of flights, and a ban on tourism visas for many travelers, were announced by Carrie Lam, the city’s chief executive.
Again, I am…