Entries by Phil

Wear a Mask Wednesday – President Trump Finally Sees the Light

99 Days Later, Trump Finally Wears a Face Mask in Public

“"We are asking everybody, when you are not able to socially distance, wear a mask," Trump said. “Whether you like the mask or not, they have an impact."

The US has learned "a great deal" about "the China virus", and unfortunately, things will probably "get worse before they get better" Trump said.

“Some areas of our country are doing very well, others are doing less well,” the President said. “It will probably, unfortunately, get worse before it gets better. Something I don’t like saying about things, but that’s the way it is.”

Yes, that's the way it is.  

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.    

You're a stock trader – how does that chart of US infections look to you?  Almost as good as Tesla but, unlike TSLA, this chart won't suddenly turn around an uninfect people.  In fact, it looks like it's about to have a massive breakout and that's why, finally, the President is scared enough to change his tune – he is presiding over one of the biggest catastrophes in human history and his name, his family name and his "brand' will forever be associated with this disaster.  

And it is a disaster and, even if the stock market refuses to recognize it – you'd better because, like not wearing face masks, ignoring the virus will not protect your portfolio and you PROBABLY won't die – but you might.  You KNOW you might.  So you MIGHT make more money and that would be fun but your portfolio also MIGHT die and, with the virus, we are attempting to avoid dying by staying inside and not having fun for…
continue reading

Testy Tuesday – 11,000 and Bust on the Nasdaq?

Happy 11,000!  

That's right, only 4 months ago the Nasdaq was at 6,771 and now we're over 11,000 this morning, up 62.5% in 4 months.  OK, so we fell from 9,000 in January so we're "only" up 22% for the year and that's normal in such a booming economy with people out frolicking and shopping and fully employed with bonuses and rasises for everyone, right?  

No, this is so wrong,  actually.  Last year, without the virus and with the tax cuts and with the Fed and with the China Trade Deal – the Nasdaq was at 8,000 but, since last October, we've one crazy and popped 37.5% overall and we gave it all up in a flash crash in March and now, despite the fact that the virus (remember the virus) is much, much worse than it was then, we're up much more than that now. 

Will the virus be cured?  Yes, probably by March we'll have a vaccine and certainly we'll have treatments that lower the damage done by the virus – hopefully it will be more like pneumonia or bronchitis – something people get and get treated for routinely.  Still, that's not the case yet and ignoring the economic risks that lie ahead is insane.  To a large extent, this is simply a reaction to all the money that's being thrown at the problem but that money can't all stay in the market because the problem is long-term and expensive – and it will suck that money right back out.

Speaking to CNBC’s “Managing Asia” anchor Christine Tan, Piyush Gupta said government stimulus in many countries is helping businesses tide through the current difficult period. But when those measures come to an end, many companies may not survive, he explained.

“Do you keep putting money … using public finances to support companies or do you let creative destruction happen a la Schumpeter? This is going to be a real challenge particularly in the SME space around the world, I suspect this will be a big, big challenge next year,” he added.


continue reading

Monday Market Movement – More Stimulus, of Course

Yes, we still have the virus.

2.2% more cases per day now, up from 1.9% the week before.  That's the very opposite of having things under control with 14.5M Global cases, 606,206 Global deaths and 3.8M in the US (26% of the World's total) and 140,534 Americans are dead – that's like 35 9/11s in the 120 days since Trump told us the virus was nothing to worry about

Of course he's still saying that and our case count is skyrocketing.  The chart above is not a chart of Covid cases but a chart of Hospital Capacity and we are at or over the limit in 7 states, including my own Florida which hit 127% of capacity this weekend.  NOW people are going to start dying, big time.  That's why the President stopped hospitals from reporting to the CDC last week – these numbers are going to get shocking and the Trump Administration has no intention of doing anything to stop it.  

Why?  Re-election, of course.  Trump's only chance now is to keep you locked in so you won't go out and vote in November.  The entire Republican party needs the lowest possible voter turnout in November and they are doing everything in their power to ensure that happens – even if it leads to another 140,000 voter deaths.  

I think everyone saw Trump unleash the storm troopers in Portland this weekend and, of course, the situation got worse, not better.  Rioting has become the new American passtime in Trumpland and just wait until they try to force the colleges to re-open and put 14,500,000 student lives at risk by jamming them into lecture halls and dormitories.  It's very much like being drafted to risk your life for Capitalism in the 60s and we can expect a similar response as students are forced to leave the relative safety of their homes for the first time in months

Of course, that's nothing compared to Trump and DeVos' anti-science experiment on our 56.5 Million young children (and their teachers) who are being forced to go back to school where they will, of course, be way too close to each other every day and then, every day,…
continue reading

Philstockworld July Portfolio Review – Members Only

Image result for one million dollars animated gifRather than writing about news the market is ignoring, I thought I'd get started on our Portfolio Review.

I tried this last month and never finished it (finished in chat) but, seriously, I am trying not to be doom and gloomy so I'm going to ignore the news and focus on our nice Member Portfolios and this should be quick because we did the Long-Term Portfolio (LTP) Review on Wednesday morning (only 2 changes) and the Short-Term Portfolio (STP) Review on Tuesday (no changes) and the reason there is nothing to change is because we are super well-balanced, as we should be in a time of uncerainty.  

How well-balanced.  Well the STP was at $405,464 on Tuesday and the LTP was $901,428 on Wednesday for a combined $1,307,074 in our primary paired portfolios and, as of yesterday's close, we're at $928,128 and $381,501 for a combined $1,309,629 – that's pretty well-balanced!

There are two ways to play uncerainty and one is to go to CASH!!! and we topped out at right about $1.4M (up 133% for the year) in the LTP/STP and I said at the time that we should put a stop at $1.2M to preserve a double but then we had some craziness with TSLA so we rode that out and hopefully it will calm down and start making some money.  In any case, we didn't cash out, we decided to hold our positions and being well-hedged is like cashing out as we're not likely to make a lot but, if we're quick, we have a better chance of catching a nice move than if we were just sitting on sidelined cash. 

If we were not locked in our homes with nothing to do – I would have cashed out and been on a nice 3-week cruise at the moment – that is the more sensible thing to do.  The advantage of either CASH!!! or balance in an uncertain market is that, if the market goes lower and you hold your value – then you have a lot of money to buy stocks when they are actually cheap – just like we did in March – which is why we are up so much now.  We'd hate to miss another…
continue reading

Mask On Thursday – Surging Virus Numbers Push Many States to Lock Back Down

Remember the virus?

The stock market sure doesn't but the US, on the whole, just reported it's second-highest jump in infections and governors and mayors were scrambling to issue new mask orders and limit the size of gatherings.  Several large school districts also said they would open the academic year with online classes, bucking pressure from President Trump and his administration to get students back into classrooms as quickly as possible.

The new restrictions reflect a painful reality that America’s outbreak, which has increased in 41 states over the past two weeks, may worsen in the coming weeks and months.  Wednesday’s tally of more than 67,300 new infections was about 1,000 cases shy of the record set late last week, according to a New York Times database, as the country’s total number of cases passed 3.5 Million.  Meanwhile, 963 more of Trump's "Virus Soldiers" died yesterday in their brave struggle to keep the economy open for the President's Re-Election – no matter how many lives it costs.  

As you can see from the S&P Chart, we were rebounding just fine in May, while we were still locked down as life was ajdusting to the "new normal" – as it did in the rest of the World.   2 months ago, on May 16th, we had less than 1.5M viral infections in the US and we had drastically slowed the spread – even with many states not following the lockdown protocols.  BUT, then we had this rush to "re-open" into the Holiday Weekend and, in just two months since then, we have added 2M more cases and the chart is RAPIDLY accellerating as we hit two new records in the past 5 days. 

DESPITE pouring $2.7Tn of direct stimulus into the economy and another $4Tn of aid from the Fed – we are STILL not back at our February highs – excpet the Nasdaq, which is way off in fantasy land at 10,550, after testing 11,000 on Monday.  The Nasdaq was at 9,500 in February so it's up 11% during the pandemic while the S&P is less than 200 (5.8%) points off it's high.


continue reading

Wonderful Wednesday – More Stimulus and a Vaccine?

Goldman Sachs made money!  

Yes, I know, that's not really a surprise but the markets are acting like it is this morning and the Dow is up almost 500 points, pre-market with Goldman Sachs (GS) contributing 50 points with their $9 (4%) jump on better than expected earnings.  Mainly we're up because last night Moderna's Covid Vaccine showed positive immunity responses in all 45 people tested and now they are heading into a much bigger phase two study (30,000 subjects) at the end of the month.

The new “Cove” study, scheduled to start July 27, will aim to enroll about 30,000 adults at nearly 90 different U.S. locations. Many of the study sites will be in states where the virus is surging, such as Texas, Florida, California and Arizona, according to information posted Tuesday on a federal database of medical studies.

Among the people researchers plan to enroll are those at appreciable risk of infection because of where they live. Testing the vaccine in coronavirus hot spots could help generate answers about the vaccine’s efficacy sooner, because people there are more likely to be exposed to the virus in everyday living compared with people in places where new cases have declined.

Researchers, however, still don’t know what level of a neutralizing immune response would be needed to guard against either infection or severe disease, and for how long a vaccine could provide such protection.

More than half of the study participants had side effects including fatigue, chills, headache and injection-site pain. Three participants who received the highest dose level tested had one or more severe adverse events, the researchers said. That highest dose level isn’t being tested in the large phase 3 study.

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?

This should give everything a nice boost but hopefully not Tesla (TSLA), which is killing our Short-Term Portfolio (see yesterday's review) but, fortunately, great for the Long-Term Portfolio,
continue reading

Testy Tuesday – S&P 500 at 3,135 (10% line), As Usual

Wheee, what fun!

Although the Dow fell 500 points into the close yesterday we still finished the day in the green as we had quite the low-volume rally in the morning (before the market opened).  That brought in what they call the "bag holders" to buy the "rally" before they got whipsawed in the selling frenzy that over took the market in the afternoon as California announced it was going back to lockdown as the virus rages out of control (again). 

WHO Says Pandemic to Linger; Cases Pass 13 Million: Virus Update.

See, that's what I'm talking about!  What a coincidence that news item popped up there…  That's right, not all the news is GREAT and we're still very concerned about what's going on in the World and, without new stimulus officially being announced, the market is looking just a little bit tired of rallying on rumors of virus cures, etc. and now we are getting REAL earnings reports that are not, on the whole, very pretty.

I'm sure everything will be "FINE" eventually but, for now, I'd say a little caution would be recommended – just in case it isn't.  We keep our hedges in the Short-Term Portfolio (STP) but those are getting killed recently because of Tesla's (TSLA) wild ride though we did take advantage of yesterday's spike up to sell more short calls, we're still way behind on that position though it is an excellent hedge against a market crash as I very much doubt TSLA will be immune:

There's not much we're looking
continue reading

Portfolio Protection Workshop Part 7 – 20 Crisis Trades Revisited

Amazon.com: 4 Month Anniversary Cup for Boyfriend - Four Month ...Has it been four months?

That's right, it was four months ago when we first plunged below our 2,850 "Must Hold" line on the S&P 500 and, as I said back on March 12th, "When the going gets tough, the tough go shopping" and it's not just the lower stock prices we take advantage of when our fellow investors are panicking out of positions but the higher levels of volatility raise the Volatility Index (VIX) and allow us to "Be the House" and sell options for fantastic premiums.  

Initially, we sell puts to establish good entries in positions when we think there may be more downside.  We'll see how those are doing and decide whether we want to expand on our plays.  The first round was taken on March 12th, and these were the trade ideas followed by the current price and profit in caps:

  • Boeing (BA) – It's hard to call a bottom on BA but they will be close to $160 this morning and that means we can sell 5 of the 2022 $110 puts for $27.50 ($13,750) in the LTP for just $3,707 in margin. This one could be a rough ride.  NOW $20.00 ($10,000) UP $3,750 (27.3%)


continue reading

Friday Follies – Marching Headlong into Earnings Season

Buckle up, it's going to be a bumpy ride!

We're 10 days into the third quarter and look how well things are going with almost every state having the virus under control except for a few idiot red states that think they are immune but, either way, the daily briefings and general public awareness have certainly turned the tide and….  what?  That's the chart from May?  Oh gosh, I'm sorry – let's take a look at the same chart as it is today thanks to our completely inept leadership:

Oh my God – get me out of this country!!!  What?  We aren't allowed to leave because we're too likely to be infected?  Inept is not the right word for our leadership then, is it?  "Contrary to the continued existence of American life" is a more accurate description for these morons, really.  You would think this is all some kind of plot to destroy America that was set into motion by a foreign Government, setting up a puppet leader who would send America spiraling down a path of division and destruction.   Nah….

The only good news here is the same good news I predicted back when Trump was first elected – this may be the end of the Republican Party – just like Herbert Hoover in 1929-1933 led to over 20 years of Democratic rule.  When Hoover was elected, the Senate had 56 Republicans and just 39 Democrats and the House had a 267-163 Republican majority and, just like they did 100 years later, they raped and looted the land and destroyed the economy and, just 4 years later, there were 59 Democratic Senators and just 36 Republicans and, in the House, there were 313 Democrats and just 117 Republicans and, by 1937, Republicans almost qualified for endangered species protection with only 17 remaining GOP Senators and just 89 House Members.

While it's still too early for the Democrats to throw Putin a thank you party for installing the Puppet of Doom for the GOP in the White Hosue, it's certainly looking like more of a Blue Tsunami than a "Blue Wave" is shaping up for the upcoming elections
continue reading

59,000 Thursday – Another Record High for Viral Infections

You're gonna be tired of so much winning! - Donald Trump CODE(KEEM ...Winning!  

As Trump predicted in 2016 we are so tired of winning at this point, aren't we?  The US is clearly winning the virus race with a record 59,400 infections on Wednesday – our 5th National Record in the past 9 days – WINNING!  On Tuesday we celebrated our 3,000,000 infection in the US and we're officially at 1% of the total population infected so that's 1/100 people carrying the virus (that we know of without adequate testing - which the President says causes more cases) and it remains airborne so see how well you do today avoiding coming in contact with 100 people or things that have been touched by 100 people….

There is a certain logic to "getting it over with" – they probably can't stop it from spreading, there is no miracle cure and we're all going to get it eventually so why prolong the agony?  Well, one reason is that hospitals are out of room for new patients and also out of supplies which means the virus can spread out of control when we try to treat infected people and more infected people means less room and less supplies and that will cause more people to die and not just from the virus but hospital staff is pulled away from other duties as well – endangering non-Covid patients.  

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,” said Randy Bury, President of the Good Samaritan Society, which has struggled to keep its 200 nursing homes supplied with hand sanitizer, masks and gowns. “The supply chain in the United States is not healthy, and we’ve learned we cannot depend on the Government.”  

Trump has resisted using federal powers to address the problem, saying in March that individual governors should find their own gear because “We’re not a shipping clerk.” With the National Strategic Stockpile depleted, states have been left to fend for themselves, though the Federal Emergency Management Agency has been distributing modest shipments of gear to nursing
continue reading