Wobbly Wednesday – Virus Surge Worries Markets

Donald Trump's Helicopter Walk After Rally Becomes Meme | PEOPLE.com2,347,102 infected Americans.

Will we even make it to November so we can choose 4 more years of this nightmare?  121,225 Americans are dead out of 477,807 worldwide – only Brazil is close to us with 52,645 dead in their country – clearly not as "great" as ours has been made.  Trump has been calling the virus "Kung Flu", which both attaches it to China (in a racist fashion) and diminishes the toll it is taking on the people of this country who are suffering and dying under his watch.  Well played sir! 

While the Chinese (84,653 infections, 4,640 deaths) are able to travel to Europe and the US, Americans may soon not be able to travel to China or to Europe as both Governments are considering banning US travelers from entering their countries and will at least require 2-week quarantines for those that do wish to escape our disease-ridden nation.  That's as of July 1st folks, so you'd better take that summer vacation quickly.

Trump Puppet Putin | Envisioning The American DreamIn 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?  

President Trump, as well as his Russian and Brazilian counterparts have followed what critics call a comparable path in their pandemic response that leaves all three countries in a similarly bad spot: they were dismissive at the outset of the crisis, slow to respond to scientific advice and saw a boom of domestic cases as other parts of the world, notably in Europe and Asia, were slowly managing to get their outbreaks under control.

This morning, the stock market kind of cares about the virus and we're down a bit in the Futures 




















Testy Tuesday – S&P 3,135 Yet Again

"Baby here we stand again

Where we've been so many times before

Even though you looked so sure

As I was watching you walking out my door

But you always walk back in like you did today

Acting like you never even went away

Well I don't know if I can

Open up and let you in baby

Here come those tears

Here come those tears again"Jackson Browne 

That's right it's Tuesday so the S&P must be testing the 10% line and last Tuesday we failed but the Tuesday before that we popped over so it's a real coin flip this morning.

Things are looking good so far because those 30M unemployed people are still getting their $600 WEEKLY bonus checks ($18Bn/week, $72Bn/month) and those will last until July 31st and that has kept the economy from totally collapsing and has kept Consumer Spending at reasonable levels at the Bottom 25% of wage earners are now outspending the Top 25% relative to where they were before the crisis.  

Pumping an annualized $864Bn into bonus checks for the Unemployed is 5% of the GDP we're adding and that's making all those economic numbers look much better than they are, not to mention the base $15Bn a week of regular unemployment benerfits that are being handed out – that's another annualized $780Bn (4% of GDP).

Then we add in the $1,200 stimulus checks for 170M tax filers ($204Bn) and $500 for 50M dependents ($25Bn) and that's another $229Bn in Q2 is an annualized $916Bn (5% of GDP) so this economic bounce is here because we spent…
continue reading

Monday Market Movement – Futures Can’t Hold Gains

First you go low on high volume, then you go high on low volume.

That's one of the tricks "THEY" do when "THEY" want to reel in retail suckers to take stocks off their hands at high prices.  Keep the headliners like Apple (AAPL) rolling up the market while doing massive selling like we saw into Friday's close – a 100-point drop in the S&P 500 (3.2%) during the trading session but then a 60-point "recovery" when the markets closed and there was no volume – a time when it's MUCH easier to manipulate the markets, as well as the news.

Yes, we used to only have to worry about fake Financial News, the kind Jim Cramer boasts about routinely placing in this video.  As Cramer says, if you are running a hedge fund and you are not manipulating the markets – you're just not doing your job.  If you think that's not true today – just look at that action on the S&P and read the headlines of SOME papers and you tell me if we're still being manipulated or not.

ImageDoes 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%. 

I know not all of you are Economists but I'll save you 2 years of graduate school by saying down 45.5% is BAD!  What's also bad is that the average range of pundits is more like -35% so the public is in for a big disappointment if the Atlanta Fed is right and the random idiot on TV is wrong.

We get the final GDP Report for Q1 on Thursday (8:30) and that will be down 5% with Consumer Spending down 6.8% and that only reflects the last two weeks of March when we were locked up (hey, Trump did it, he locked us up like he promised!).  If we were down about 50% for two weeks and the other 10 weeks of the quarter we
continue reading

Philstockworld June Portfolio Review – Members Only

Image result for one million dollars animated gifYes, I am being lazy (some would say efficient), this is Friday morning's Report because not much is going on and these Reviews take forever to write so I'm getting a jump by doing them as we go along today.


That is up $271,547 (24%) for our paired portfolios since our last review and we've made very few changes to the LTP in the past month – the market's move higher just worked well for our leveraged positions, which are still pretty bullish from that bottom action in March.  The S&P 500 was at 2,863 back on May 15th and now it's 3,135 – up 272 points is right about 10%.  That's why we keep spending money on those hedges in our Short-Term Portfolio – we want to lock in those ridiculous gains.

We didn't do a lot of buying this month, we added FL, HMY, IMAX, KO and TIF, who were all still bargains from our Watch List but, for the most part, things have gotten too expensive to be of much interest so we are wating PATIENTLY (right guys?) for earnings – when it's certain to be bargin-hunting time again.  

Meanwhile, as our Members are certainly aware, I think being up $800,000 from our $600,000 start to the year is a bit too much money to be making so I am VERY inclined to take it all off the table and start from scratch (keeping the $800,000 in our pockets so we can't possibly have a losing year).  We could be super-aggressive in the new portfolios and it would be fun but people hate it when I do that (even though it's sensible) so I'm simply going to say that if the combined Long and Short-Term Portfolio values drop below $1.2M (up 100%), we will be shutting them down (along with the rest as their health is a good indicator for all of us).

It's boring when our portfolios are too well-balance, there's not much to do during the day…

Short-Term Portfolio (STP) Review:  The last time we checked in on the STP was way back on June 4th, when the S&P was at 3,122 in the morning, as I wrote our report.  At the time it was…
continue reading

Thrilling Thursday – Bolton Claims Trump Asked China to Help Him Get Re-Elected

Bolton Book Offers Scathing Rebuke of Trump as DOJ Escalates Efforts to Block PublicationBolton's book is out.

According to the exerpt from the Wall Street Journal (hardly part of the "Liberal Media"): "The president pleaded with Chinese leader Xi Jinping for domestic political help, subordinated national-security issues to his own re-election prospects and ignored Beijing’s human-rights abuses."  I'm sorry about the "politics" but some of this stuff you just have to read:

In Buenos Aires on Dec. 1, at dinner, Xi began by telling Trump how wonderful he was, laying it on thick. Xi read steadily through note cards, doubtless all of it hashed out arduously in advance. Trump ad-libbed, with no one on the U.S. side knowing what he would say from one minute to the next.

One highlight came when Xi said he wanted to work with Trump for six more years, and Trump replied that people were saying that the two-term constitutional limit on presidents should be repealed for him. Xi said the U.S. had too many elections, because he didn’t want to switch away from Trump, who nodded approvingly.

Trump closed by saying Lighthizer would be in charge of the deal-making, and Jared Kushner would also be involved, at which point all the Chinese perked up and smiled.

Trump spoke with Xi by phone on June 18, just over a week ahead of the year’s G-20 summit in Osaka, Japan, where they would next meet. Trump began by telling Xi he missed him and then said that the most popular thing he had ever been involved with was making a

continue reading

Which Way Wednesday – Testing the 10% Line on the S&P 500

Here we are again.

We blasted back to the 10% line at 3,135 yesterday but failed to hold it and we'll try again this morning in a very forgiving Futures market as the Fed's Powell made enough good noises yesterday about the Fed's Infinite Balance sheet that the bulls don't think there's much to worry about.

As I've mentioned, I live in Florida and over 2,700 people came down with the virus yesterday in one of the most open states in the Nation and 7.5% of the people are now testing positive for the virus but, keep in mind, that's a bit skewed towards people who think they have the virus anyway.

Just to the south of us, 34,918 people caught the virus yesterday in Brazil, about 1/4 of the 139,479 people who caught the virus around the World – one of the worst days on record.  In the New York Times this morning, Thomas Friedman, who has 3 Pulitzer Prizes, asks: "Is Trump Trying to Spread Covid-19?" and he makes a good point.  The President literally would seem to need a panel of experts who are advising him to do the WORST possible thing to contain the virus every day.  Literally NOTHING would be better than what this Administration is doing to the American people.

We are miles past Vietnam (70,000) in American lives lost to Trump's incompetence and we're heading towards World War II's 405,000 American deaths and, after that, only the Civil War (620,000 casualties) would be able to top the disaster we are facing now in this country.  We'll see what the President has to say about this on Saturday, when he holds an indoor rally for 20,000 people in Tulsa, OK – an event some are predicting will become a "Super-Spreader" as people are coming from all over the country to gather and infect each other so they can take it back to their home towns.  BRILLIANT! 

Tulsa County already had 89 new cases on Monday, the most ever, with active cases climbing from 188 to 532 in the past week as the county re-opens in preparation for the rally.  Keep in mind, those are just the cases they know about – there could be thousands of locals at the rally
continue reading

Testy Tuesday – Back to the 10% Line on S&P 500

3,135 or bust! 

That's the mantra of the day as the S&P 500 tests our 10% level, again.  As you can see on the chart (click to biggerize), we bounced right off the 200-day moving average at 3,011 last week and we consolidated for 2 days and now we're going to take another run at the 10% line but I doubt we make it today – unless more stimulus is announced and that happens every other day anyway.

You wouldn't know we need stimulus in DelRay Beach, where I live, as the restaurants are packed and the streets are crowded.  That's why Florida has added 1,300 new virus cases per day in June and 1,700 yesterday (so it's accellerating) and there's 30 days in the month so maybe 45,000 new cases is half as many cases as all of China's total in a single month and la di dah – NO ONE FREAKIN' CARES!!!

WTF is wrong with you people?  I mean really!  Florida already has 77,326 Covid patients so 45,000 more puts us well over 100,000 – and Disney hasn't even opened yet – what a party that's going to be!  Please people, fly from all over the World to the airport in Orlando and let's re-infect every country from Florida's petri dish!

So far (it takes time to go critical), 12,015 of the 77,326 infected people have had to be hospitalized so I guess this is a make-work program for hospitals or is our goal to save the Social Security Program by elmiminating the recipients?  Before the re-opening, Florida had 700 new cases per day so, for you Fox fans, 1,700 per day is more than that.

This is what I keep telling you guys – re-opening is a disaster when you haven't actually controlled the virus!  We are starting the re-infection process from a MUCH larger base than the 15 us cases we had when the virus first began spreading here in February and now we're STARTING AGAIN but from a base of hundreds of thousands of actively infected people standing next to you in the supermarket.  How do you THINK that is going to go?

The US leads the World with 2M of the 8M infections but Brazil is catching up to us with 888,271 followed…
continue reading

Monday Market Mayhem – The Madness Continues

Wheeee, what a ride! 

Of course, we expected the pullback, especially from Nasdaq (/NQ) 10,000 but 3,200 on on the S&P 500 (/ES) was also going to be a good resistance line and resistance was not futile in this round as we quickly dropped almost 10% back to test the 3,000 line and now back below the 3,135 line that marks our own 10% line on the Big Chart, which follows our fabulous 5% Rule™.  

We had some RIDICULOUS gains during that rally and we knew it wouldn't last but now we have a real test of the market's resiliance as the virus resurges in many hot spots (something else we told you would happen) and a bit of fear is back in the market even as we are on the cusp of revealing the 2nd quarter's earnings disaster in about a month.

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!  

We did our last review of the STP on the 4th, right in our Morning Report so those are the positions that made $50,000 in 7 days, right there for public consumption.  I feel it is a public service to teach people how to hedge their portfolios properly, so, since our STP is working perfectly to protect our long portfolios at the moment, let's take a look at one of our other monthly portfolios, our Money Talk Portfolio, since they will be interviewing me this afternoon for the show on Wednesday at 7pm on Bloomberg Canada.

The Money Talk Portfolio is constrained to trades that we make on the show so about once every 2-3 months we make changes.  My last appearance was on April 29th and the MTP was up 1.8% at the time, recovering from the hit it took as we were unable to adjust it during the downturn.  We added two positions, Viacom (VIAC) and Macy's (M) and now the portfolio is up 9.3% for the year but now it's time to add a hedge.






Fallout Friday – Reality Hits the Markets


What a ride we had yesterday with the Dow Jones Industrial Average falling 1,861.82 – just a bit under 7% in a single day, erasing all of June's "incredible" gains in a single day.  Of course, keep in mind that "incredible" means "impossible to believe" and we made it very, very clear this week that we did NOT believe this rally at all.

Monday Market Momentum – Up into the Fed Meeting

Of course, we're up today because Europe and Asia are up and they are up because we were up 2.5% on Friday and they are just catching up but that doesn't stop our pre-market traders from seeing a rally in Europe and trying to catch up to that – even though their rally was a reaction to our rally and yes – it's all total BS but that's the way the market works, so don't whine about it

…See, it doesn't matter if it's FAKE!!!, as long as you WANT to believe it then you are happy to hear the BS – even if you know it can't possibly be true.  Trump had his usual slew of lies in that press conference but the most insulting was the one about Black Unemployment, which was the only category of Unemployment that went up in May – even with the FAKE!!! numbers.

I do realize, by the way that every time I criticize the President or the Administration it sounds like some kind of Liberal rant and I do apologize to our Conservative readers who would rather not hear that sort of thing but this President, his policies and the blood-sucking corporate jackals he surrounds himself with really do SUCK and they are destroying this country through their policies and inactions so I say these things as both a Patriot and as an Analyst, more so than a Liberal (which I also happen to be. 

Coronavirus cartoons: Trump's ratings jump amid big job lossesTesty Tuesday – Infections Up, Markets Down Ahead of the Fed

I don't want to be your Cassandra, my "gloomy" outlook costs us the subscribers who like to hear BUYBUYBUY to confirm their bullish bias and, these days – there's

continue reading

Thursday Failure – Fed Fails to Assure the Bulls

Wheeeee – down we go! 

As we discussed in yesterday's Live Trading Webinar, this market rally has been ridiculous and certainly unsustainable (as noted in yesterday's: "Which Way Wednesday – Nasdaq 10,000 Edition") and our plan from yesterday morning ws to short the Nasdaq when it crossed back below the 10,000 line, which it did early this morning.  

As you can see, that's already paying well, as expected and now we'll see how low we can go but the stop is now 9,950 for an even $2,000 gain for the morning and we can always find a fresh horse like S&P (/ES) 3,100 if that fails.  As I said yesterday, these are the best plays you can make in the Futures as it's easy to limit your losses (using a major stop line) and lock in your gains.  

3,135 is the 10% line on the S&P 500 and that's the top of our expected range for the year, this jaunt above the line is only going to be a single weekly candle in hindsight.  

Keep in mind we are not at all technical traders – we are Fundamentalist and yes, TA is a factor in our analysis but, by itself – it's worthless.  In yesterday morning's PSW Report we noted why that market was over-priced and our range for the SPX is based on our projected earnings of the S&P 500, the effect of the Virus, the Bailout, the rest of the Global Economy (not all of which has sugar-daddy Central Banks) and, of course, sentiment – which has simply been stupid, not silly, the past few weeks.  

Abe Lincoln: You can fool some of the people some of the time ...Some of the investors can fool themselves all of the time and all of the investors can fool themselves some of the time but all of the investors can't turn a terrible economy into a bull market for very long – I would think that is obvious but, surprisingly, I find that I have to explain this to almost everyone I meet (not you fine people, of…
continue reading