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Thread: Intersting thoughts

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  1. #26  
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    Quote Originally Posted by Bruins4Life View Post
    I'm pretty new to the game. The first stock I bought Monday was OXY at 9.52
    Good move. Sit on it, don't panic. Just wait for oil prices to move upwards. Like I said, it could take a year or so but just sit on it.
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  2. #27  
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    Quote Originally Posted by yinunleaded View Post
    great Q&A! Thanks for posting all of this!
    I'll try to keep it up...Thanks.
    I like the idea of buying long calls on decent companies once a bottom is found...

    My sense is that the U.S. outside of the NYC area is entering the “it’s going to get worse before it gets better” phase. For the first time since the number of cases began to surge, the state of New York’s percentage of national cases is beginning to fall. Experts are beginning to discuss the likelihood of outbreaks in other cities, for example New Orleans and Detroit. I still do not have a precise sense of how much of the buildup in caseloads reflects more aggressive testing as opposed to the actual spread of the virus, but the number of new cases continues to surge and is beginning to be dispersed more widely around the country. The debate continues to rage over mortality rates and, more specifically, how many people will contract the virus without ever demonstrating significant symptoms. Dr. Birx last night aggressively attacked some of the more extreme casualty scenarios last night, attempting to debunk some of the worst predictions of millions of Americans, such as the UK study that has been essentially retracted. Cases will build, but a consensus is firming that deaths in the U.S. are far more likely to be in the tens of thousands than in the millions, which is worse than a typical flu season but closer to a bad flu season than an apocalypse. To be clear, I do not want to minimize the impact. A “typical flu season” does not usually have so many people in ICU/on respirators. So, there is more to the impact of the virus than just the death count.

    Next Monday marks the end of the 15-day period that President Trump designated for social distancing. I think there has been far too much overwrought media coverage that the President is about to unwind all of the restrictions currently in place. My guess is that not much will change Monday, and, indeed, we could see more cities and states impose restrictions going forward if the virus continues to spread. Keep in mind that the lockdowns are being imposed at the state and local level, and the federal government’s guidelines are voluntary. In any case, the tension between the economic damage being wrought and the public health mandate to limit the spread of the virus will continue to build next week. I suspect that we are still several weeks away from any slackening in economic restrictions, but the calls for striking a balance are likely to broaden as time goes on.

    The House is debating the fiscal relief bill now and will vote on it soon. The bill will be sent to the President’s desk today, and I would imagine that he will sign it this afternoon. I would suspect that the relevant agencies (among others, the SBA, Treasury, the Fed) have been developing implementation plans since at least Wednesday, when the Senate finalized the legislative language, so the holdup in final passage is likely not especially relevant to the timing of getting cash out the door. Officials believe that the small business lending program will be beginning to process loans by the end of next week. The Fed’s Main Street Lending Facility could be longer. In the meantime, state unemployment insurance offices are undoubtedly overwhelmed, so there are questions about how quickly the millions of applications for benefits can be processed and checks sent out.

    We got the first weekly update from the Fed on its balance sheet programs yesterday afternoon. For now, the Fed is buying securities, lending to banks via the discount window, providing funding (repo, swap lines, and PDCF), and has bought some CP to relieve prime money market funds (MMLF). The other programs are taking longer to stand up and get cranked off. The CPFF will reportedly open up next week. The facilities to help IG credit may not be needed by the time they are ready to go, based on the massive improvement (and supply) in that market this week. The TALF will be helpful, but it could be weeks before the first deal is done. The Main Street Lending Facility, which could be the biggest program of all, is behind all of these other “alphabet soup” programs in line. So, let’s hope the busy officials at the Fed can work quickly. Having said all of that, stress levels in financial markets have receded in a meaningful way this week, thanks in no small part to the Fed’s aggressive moves. Leveraged loans rebounded somewhat in price yesterday, and the MBS market is seeing broadening improvement (though it is far from normal). We’ll see how today’s first agency CMBS operation goes.

    Moving on to the economy, there is simply no precedent for gauging the depth of this downturn. Estimates remain all over the place. My guess is somewhere in the neighborhood of down 15% for Q2 GDP, but I cannot rule out 20% or even 30%. The big question in my view is when we start to get a resumption of activity and how quickly activity ramps up. At this point, I see that question as largely unanswerable. I remain more optimistic than most. I think that activity will have come well off the bottom by the end of the second quarter, while others expect lockdowns to persist for much or all of the quarter.

    I get the argument that some industries are going to be changed for a long time. In fact, we can easily come up with a long list: international travel, cruise ships, restaurants, concerts, just to name a few. However, if people have income, they will spend it. So, some service industries may suffer permanent loss, but others will rise. People are going to eventually emerge from their self-isolation and when they do, they are going to want to buy goods and services. This is why the fiscal relief bill is so critical. If the federal government can keep most businesses and households close to whole long enough to get to the other side of the virus, then spending will explode on the other side. In contrast, if there are tens of millions of households who lose their job AND do not get help, then the income to support such a rebound will not be there.

    The analog to this on the labor side is how effective will the fiscal relief to business, small businesses in particular, be in keeping workers on the payroll, or bringing them back if they have already been laid off. I am relatively optimistic on this question, though obviously open to revisiting. I would expect another 4 or 5 million new filers in next week’s initial claims report, but I think the numbers will begin to fall back after that, and I would not be surprised if at least a few million of the workers who have filed over the past two weeks actually get called back, once the fiscal programs are up and running, maybe even in time to be included in the April employment report. So, we have seen estimates from Fed officials and others that the unemployment rate could spike to 15%, 20%, or even 30% (Bullard), but I am leaning toward a much smaller spike. As I have noted before with respect to growth, it is far less important how high the unemployment rate surges to in April and May than to see how quickly those workers get back to their jobs in June, July, and August.

    Have a safe weekend!

    Stephen Stanley
    Chief Economist




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  3. #28  
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    Bozzie, the problem is....when do we know when "the bottom is found"???? I wish one of us had a crystal ball!!
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    Quote Originally Posted by CoachCB View Post
    Bozzie, the problem is....when do we know when "the bottom is found"???? I wish one of us had a crystal ball!!

    I haven't taken much of a position yet but all these pros talk about a "bottom" being built now and buying on the dips...
    Reality about the amount of time parts of the economy are going to be shuttered might be starting to sink in, last weeks talk about opening back up for biz by Easter had a + effect...
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  5. #30  
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    Quote Originally Posted by Bozzie View Post
    I haven't taken much of a position yet but all these pros talk about a "bottom" being built now and buying on the dips...
    Reality about the amount of time parts of the economy are going to be shuttered might be starting to sink in, last weeks talk about opening back up for biz by Easter had a + effect...
    I think we're going to see an uprising if this continues past Easter weekend. I personally think it's a bunch of bullshit, but that's another topic. I don't expect the market (or the economy) to get back anywhere close to what it was, but I expect to see the Dow settle in around 24-25.5k....and slowing creep up from there - and I'd be fine with that. I think 'buying the dips' is a good idea right now.
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  6. #31  
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    I'm betting on some pretty good volatility next week... I like those opportunities.
    Earnings/unemployment numbers /Governor Cuomo

    Jobs will be a major focus in the week ahead as the U.S. economy reels from the impact of the pandemic. The ADP employment report and weekly initial jobless claims report are due out before the March jobs report drops on April 4. The March jobs report is expected to only show a loss of about 300K jobs as the real damage doesn't arrive until April and May. Moody's Analytics Chief Economist Mark Zandi forecasts the unemployment rate in the U.S. will hit double digits within a few months on delayed repercussions. PMI prints will also pour out next week from Spain, Germany, the U.K. and U.S. to give a quick snapshot of economic activity. The corporate event and earnings calendars are thin once again next week, but investors should be strapped in for plenty of action as animal spirits rage on.
    Earnings spotlight: A trio of companies seeing spikes in demand for food products are due to report next week, with egg-producer Cal-Maine Foods (NASDAQ:CALM) on tap for March 30 and pantry loaders Conagra (NYSE:CAG) and McCormick (NYSE:MKC) both reporting on March 31. Other companies due to spill numbers during the week include Lamb Weston (NYSE:LW) on April 1; Walgreens Boots Alliance (NASDAQ:WBA), Chewy (NYSE:CHWY) and CarMax (NYSE:KMX) on April 2, as well as Constellation Brands (NYSE:STZ) on April 3.
    Go deeper: See Seeking Alpha's complete list of earnings reporters
    IPO watch: WiMi Hologram Cloud (WIMI) is expected to price its IPO on March 30. IPO lockup periods expire on Viela Bio (NASDAQ:VIE), Aprea Therapeutics (NASDAQ:APRE), Frequency Therapeutics (NASDAQ:FREQ) and MetroCity Bankshares (NASDAQ:OTC:MCBS) on March 31. The analyst quiet period runs out on GFL Environmental (NYSE:GFL) on March 30. Across the Pacific, the IPO lockup period expires on Budweiser Brewing Company (BUDBC) in Hong Kong. Shares of BUDBC are down 22% since the beer company was set free from Anheuser-Busch InBev (NYSE:BUD).

    Go deeper: Catch up on all the latest IPO news.
    Projected dividend changes (quarterly): Bank OZK (NASDAQ:OZK) to $0.27 from $0.26, Constellation Brands to $0.76 from $0.75, SM Energy (NYSE:SM) to $0.01 from $0.05, and Dollarama (OTC:DLMAF) to C$0.050 from C$0.044.
    Go deeper: Read the latest dividend analysis.
    M&A tidbits: Shareholders with the Rubicon Project (NYSE:RUBI) vote on the company's merger with Telaria (NYSE:TLRA) on March 30. The walk data on China Oceanwide's acquisition of Genworth Financial (NYSE:GNW) is March 31. The tender off expires on the Super ROI Global-Jumei International (NYSE:JMEI) deal on April 1.
    Analyst/investor meetings: Pfizer (NYSE:PFE) rescheduled its investor day update that was planned for March 31 without setting a new date. Bristol-Myers Squibb (NYSE:BMY) also pulled the plug on its event, while GoDaddy (NYSE:GDDY) is going to an online format with its presentation set for April 2. Enterprise Products Partners (NYSE:EPD) and The Andersons (NASDAQ:ANDE) also have events scheduled.
    Apple's non-event: While Apple (NASDAQ:AAPL) made a surprise announcement already of new versions of iPad Pro, Mac Mini and MacBook Air devices with its March 31 keynote event canceled, the company stopped short of announcing a launch of the new lower-cost iPhone 9. Some reports indicate that Apple has held internal discussions about potentially delaying the launch by months due to supply chain issues arising from the pandemic. There is also some talk that Apple will push back the debut of the highly-anticipated Apple 12 5G smartphone from the traditional September window. "We believe the chances for a launch in the September/October time frame is "extremely unlikely" and would assign a 10%-15% probability it happens given the lingering supply chain issues that remain across Asia," warns Wedbush Securities analyst Dan Ives. The firm is still bullish on Apple for the long term due in part to the 5G super cycle.
    IT disruption: The tech sector has been disrupted by the pandemic, not just with share price declines, but an upheaval of IT demand changes that could be a game changer. Taking the long view, JPMorgan sees an acceleration in certain slow-moving IT infrastructure trends driven by the broadening disruption of COVID-19. In particular, the firm notes increasing bandwidth requirements due to the increasing number of employees working from home in a trend that looks positive for Ciena (NYSE:CIEN), CommScope (NASDAQ:COMM), Infinera (NASDAQ:INFN) and Hewlett-Packard Enterprises' (NYSE:HPE) Aruba. An increase in leverage of the public cloud is seen setting up Arista Networks (NYSE:ANET) and NICE Ltd. (NASDAQ:NICE), while the increase in migration from proprietary hardware solutions to virtual solutions is seen as a win for VMware (NYSE:VMW). Then there is the sudden growth of contactless transactions, led by the adoption of electronic wallets to reduce human-to-human interaction. That development looks good for Diebold Nixdorf (NYSE:OTCPK:DBD) and NCR (NYSE:NCR). With everyone burning up their laptops for the next few weeks or longer, JP sees an upgrade cycle benefit for HP (NYSE:HPQ), Dell Technologies (NYSE:DELL) and Logitech (NASDAQ:LOGI). In semiconductors, the firm taps Broadcom (NASDAQ:AVGO), Intel (NASDAQ:INTC), Micron Technology (NASDAQ:MU), Marvell Technology (NASDAQ:MRVL), Qorvo (NASDAQ:QRVO), Inphi (NYSE:IPHI) and Nvidia (NASDAQ:NVDA) as attractive amid the anticipated strong growth in cloud and hyperscale datacenter spending.

    Spotlight on Nielsen numbers: While Nielsen data is pushed out every few weeks for analysts to size up, the firm's release next week of 4-week trends will be a showstopper. The huge efforts of U.S. consumers to stockpile a variety of different household and pantry products should be on full display when the report drops. Companies that are expected to see some strong numbers include Coca-Cola, Keurig Dr Pepper (NYSE:KDP), Monster Beverage (NASDAQ:MNST), Clorox (NYSE:CLX), Procter & Gamble (NYSE:PG), Kimberly-Clark (NYSE:KMB), Church & Dwight (NYSE:CHD) and Edgewell Personal Care (NYSE:EPC). Cowen thinks pantry loading by consumers in March also included the beer and other alcohol categories. That prediction could be confirmed in the Nielsen data for Constellation Brands, Molson Coors (NYSE:TAP), Craft Brew Alliance (NASDAQ:BREW), Anheuser-Busch InBev and Brown-Forman (NYSE:BF.A) (NYSE:BF.B).
    Macau: Macau authorities will post gross gaming revenue numbers for March sometime during the first few days of April. Analysts see March GGR falling by as much as 75% compared to a year ago as tourism remains at a standstill in the gambling mecca. An initial bounce in Macau traffic to 10K visitors a day fell back to 7K visitors by the third week of the month as global headlines worsened. Before the coronavirus outbreak, weekly tourist visits of +100K were the norm. Names to watch for another round of volatility include Wynn Macau (OTCPK:WYNMF), Wynn Resorts (NASDAQ:WYNN), Sands China (OTCPK:SCHYY), Las Vegas Sands (NYSE:LVS), MGM China (OTCPK:MCHVF), MGM Resorts (NYSE:MGM), Galaxy Entertainment (OTCPK:GXYEF), SJM Holdings (OTCPK:SJMHF), Melco Resorts & Entertainment (NASDAQ:MLCO) and Studio City International (NYSE:MSC).
    U.S. auto sales: Edmunds forecasts U.S. auto sales will fall 35.5% Y/Y in March to 1,044,805 new cars and trucks amid the coronavirus pandemic. "The first two months of the year started off at a healthy sales pace, but the market took a dramatic turn in mid-March as more cities and states began to implement stay-at-home policies due to the coronavirus crisis, and consumers understandably shifted their focus to other things," notes Edmunds director Jessica Caldwell. "Automakers can count on capturing some deferred demand once we get past the worst of this pandemic, but since they'll be competing with so many other companies for consumer spending at that point, they're really going to need to create incentives to spur some sales," she predicts. TrueCar sees a 42% drop to below 1M units for the month. Meanwhile, J.D. Power thinks the pandemic and economic crisis are likely to accelerate the move to online sales by auto dealerships. Edmunds March forecast by manufacturer - General Motors (NYSE:GM) -31.3% to 186K units, Ford (NYSE:F) -31.0% to 160K, Fiat Chrysler Automobiles (NYSE:FCAU) -28.1% to 144K, Toyota (NYSE:TM) -36.2% to 137K, Honda (NYSE:HMC) -41.8% to 86K, Nissan (OTCPK:NSANY) -46% to 82K, Hyundai/Kia (OTCPK:HYMLF) -31.4% to 81K, Volkswagen/Audi (OTCPK:VWAGY) -41.4% to 34K. TrueCar's March estimate for Tesla (NASDAQ:TSLA) is -23.5% to 9,939.

    New video conferencing player in town: RingCentral (NYSE:RNG) is expected to launch a video product to compete with Zoom Video Communications (NASDAQ:ZM) next week. "In the very near term, RCMeeting will not only begin to be sold in RingCentral Office bundles across most U.S. segments, but it will also begin to replace the installed base of ZM at RNG customers," previews Rosenblatt Securities. Shares of RingCentral are up 30% over the last week, while Zoom Video is up 45% over the last four weeks.
    Retail check: Retail chains that are seeing high demand for the early part of the stay-at-home spring in the U.S. are likely to continue to outperform next week and beyond, reasons Odeon Capital. The list of chains with positive sales trends includes Target (NYSE:TGT), Walmart (NYSE:WMT), Costco (NASDAQ:COST), BJ's Wholesale Club (NYSE:BJ), Ollie's Bargain Outlet Holdings (NASDAQ:OLLI), Home Depot (NYSE:HD), Lowe's (NYSE:LOW), Tractor Supply (NASDAQ:TSCO), Ulta Beauty (NASDAQ:ULTA), Best Buy (NYSE:BBY), Lululemon (NASDAQ:LULU) and Dick's Sporting Goods (NYSE:DKS). The common theme is that the businesses provide essential or at least therapeutic products (even psychologically so) to consumers and have a robust digital penetration.
    Gene therapy: The 4th Annual Gene Therapy for Rare Disorders Summit was canceled, but it's possible the list of companies due to appear could still make announcements. That list includes bluebird bio (NASDAQ:BLUE), BioMarin Pharmaceutical (NASDAQ:BMRN), Orchard Therapeutics (NASDAQ:ORTX), Takeda Pharmaceuticals (NYSE:TAK), Spark Therapeutics (NASDAQ:ONCE), REGENXBIO (NASDAQ:RGNX), Biogen (NASDAQ:BIIB), Voyager Therapeutics (NASDAQ:VYGR), Amicus Therapeutics (NASDAQ:FOLD), Sanofi (NASDAQ:SNY), Ultragenyx Pharmaceutical (NASDAQ:RARE), Sarepta Therapeutics (NASDAQ:SRPT), Selecta Biosciences (NASDAQ:SELB), Pfizer (PFE), AVROBIO (NASDAQ:AVRO), Invitae (NYSE:NVTA), Repligen (NASDAQ:RGEN), BridgeBio Pharma (NASDAQ:BBIO), Sangamo Therapeutics (NASDAQ:SGMO), Bio-Rad Laboratories (NYSE:BIO) and uniQure (NASDAQ:QURE).

    Barron's mentions: The publication finds bargains in tech stocks and municipal bonds this week. The list of favorite picks blasted out by a roundtable of tech stock pickers includes DocuSign (NASDAQ:DOCU), Equinix (NASDAQ:EQIX), Digital Realty Trust (NYSE:DLR), CyrusOne (NASDAQ:CONE), CoreSite Realty (NYSE:COR), Twitter (NYSE:TWTR), Disney (NYSE:DIS), Advanced Micro Devices (NASDAQ:AMD), Lam Research (NASDAQ:LRCX), AT&T (NYSE:T), Comcast (NASDAQ:CMCSA), Taiwan Semiconductor Manufacturing (NYSE:TSM), Micron Technology (MU), Alibaba (NYSE:BABA), Applied Materials (NASDAQ:AMAT), Zynga (NASDAQ:ZNGA), Take-Two Interactive Software (NASDAQ:TTWO), Electronic Arts (NASDAQ:EA) and NetEase (NASDAQ:NTES). While municipal bonds might not get the same amount of attention as the tech sector, high yields and the potential for a recovery are seen making them stand out. The VanEck Vectors High Yield Municipal Index ETF (BATS:HYD) and iShares National Muni Bond ETF (NYSEARCA:MUB) are two catch-all ways to play the bounceback in munis. Finally, the cover story on America vs. COVID-19 is worth a read and relevant to pretty much everyone. So is the conclusion that if "we" get this right and stay healthy, it could be the opportunity of a lifetime.
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  7. #32  
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    So....whats the strategy for Monday morning?

    Do you expect another dip in market prices?
    How did a generation raised on South Park and Family Guy become sooooo sensitive?
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  8. #33  
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    I'd love to see it give back most or all of the gains from last week . if it's truly bottom building?
    I want to jump back in if it dips enough.. 2350? A dude I know thinks 2100 is the bottom.
    I'm mostly playing leveraged funds X2 and 3. Again.. these funds can be a hold trap .

    Anyone else have an call?
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  9. #34  
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    Mondays plan is just like fridays plan for me... microsoft apple and coke , last week i sold off almost every share i had at a .10 cent profit , but my three long term holdings UPS, apple.
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  10. #35  
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    Quote Originally Posted by smartmoneyfollower View Post
    Mondays plan is just like fridays plan for me... microsoft apple and coke , last week i sold off almost every share i had at a .10 cent profit , but my three long term holdings UPS, apple.

    you loving todays action?
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  11. #36  
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    I feel like Bill Murray in ground hog day, buy microsoft apple and coke , sell and repeat don't hold anything, when stimulus funds come buy utilities.
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  12. #37  
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    Mad Hedge Hot Tips
    April 2, 2020
    Fiat Lux

    The Five Most Important Things That Happened Today
    (and what to do about them)


    Weekly Jobless Claims Explode to 6.64 Million, bringing total losses for this cycle to 10 million. That’s three full recessions of job losses in two weeks. We are already approaching Great Depression levels. The headline unemployment rate is likely 10% on its way to 30%. Will tomorrow’s March Nonfarm Payroll Report be worse?

    Click here to read the rest of today's Hot Tips




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  13. #38  
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    This is not a bash. Just asking.

    MRO was listed in 1986. Prior to the past month it's all time low was 3.88. Now down to 3.47.

    Will they survive?
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  14. #39  
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    Quote Originally Posted by Bozzie View Post
    This guy has been very good for a long time...
    Mad Hedge Hot Tips
    March 25, 2020
    Fiat Lux

    The Five Most Important Things That Happened Today
    (and what to do about them)


    Don’t Buy This Rally, up 2,000 in a day, an all-time record rally. We have a series of horrendous numbers about to hit the market, starting with a 3 million Weekly Jobless Claims tomorrow. But this is the beginning of a bottom-building process. Get buying the 1000-point down days and selling the rallies. The BUY of the century is setting up, just not yet.

    Click here to read the rest of today's Hot Tips

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    Counting on you to bring us this "BUY of the century" when he discloses it, Bozzie.

    Yes, thank you.
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  15. #40  
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    Quote Originally Posted by Michelangelo View Post
    This is not a bash. Just asking.

    MRO was listed in 1986. Prior to the past month it's all time low was 3.88. Now down to 3.47.

    Will they survive?
    If oil keeps getting beat up maybe not. But, this is probably the most unusual period for oil since the early 80's oil embargo.
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    If it wasn't for the coronavirus, the news cycle would most likely be exclusively focused on the oil market, where demand has dropped by as much as 30M barrels per day (roughly equivalent to the combined output of the Saudis, Russia and the U.S.). The latest? WTI crude prices soared 25% on Thursday for its largest single-day percentage gain in history after President Trump said he expects Russia and Saudi Arabia to announce a major output cut deal. Despite swirling skepticism over how relevant that will be due to depressed demand, crude tacked on another 5% overnight. A virtual OPEC+ meeting is also scheduled for Monday that will be open to producers even outside the group.
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    More on oil
    Storage is a problem with the market awash in crude, while the U.S. is prohibited by antitrust law to join output cuts (those discussions are taking place at the state level in Texas). Today, President Trump meets with U.S. oil industry executives at the White House, and there's some speculation he could ask the industry to chip in with their own cuts (at the corporate level). The agenda is also expected to include discussions on government support, tariffs on foreign oil, as well as other waivers to ease the pain.
    Go deeper: HFIR discusses oil prices in the near-term.
    No stability, only volatility
    U.S. equity markets climbed 2.2% on Thursday as a surge in oil countered an eye-popping jobless claims report, which showed 6.6M people out of work, and some states even reporting that 10% of their workers are no longer employed. A reminder that today's non-farm payrolls report from the Labor Department won't reflect that data, as the numbers were pulled in mid-March, before a large section of the population was under some form of a lockdown. One day up, one day down... Stock futures are now off 1.3% as concerns mount over a V-shaped economic recovery and economists warn that the government and Fed will need to provide additional stimulus.
    Go deeper: CBO sees GDP contracting 7% in Q2.
    Lending program chaos
    We're only hours away from a federal program that's expected to dole out at least $350B in loans to small businesses struggling with the coronavirus pandemic, but many banks are still awaiting guidance and necessary requirements. JPMorgan (NYSE:JPM) appeared to be the first lender to publicly say what others had whispered, emailing customers that it "will most likely not be able to start accepting applications on Friday." The Paycheck Protection Program will offer up to $10M to help cover wages for employees, sick pay and eligible mortgage and other immediate debt payments. The loans are for two-year terms at a 1% fixed rate of interest, require no collateral and come with debt forgiveness options for eligible expenses.
    Big Brother or necessary surveillance?
    In an effort to assist in "unprecedented times," Google (GOOG, GOOGL) is helping public health officials use its vast storage of data to track people's movements due to the coronavirus pandemic. The "mobility reports" go down to the county level to see if locals are abiding by social distancing measures, but will use anonymized historical data, with a lag of two or three days. Google is also reportedly exploring individual location tracking with a White House task force, as well as running a handful of testing sites in Northern California in a private-public partnership with the government.
    Employee furloughs
    With no clear forecast of when its parks will be able to reopen, Disney (NYSE:DIS) has announced plans to furlough non-union workers and stop collecting payments for its annual park passes. "Disney employees have received full pay and benefits during this time, and we've committed to paying them through April 18, for a total of five additional weeks of compensation," the company said in a statement. Employees will also be eligible for $600 per week in federal compensation through the $2T economic stimulus bill, as well as state unemployment insurance.
    'Big price to pay'
    "We hit 3M (NYSE:MMM) hard today after seeing what they were doing with their Masks. "P Act" all the way... will have a big price to pay!" President Trump said in a tweet last night. He was apparently referring to a Fox News report featuring the head of Florida's Division of Emergency Management accusing 3M of shipping N95 respirators to foreign countries who outbid U.S. buyers. Trump earlier announced he was invoking the Defense Production Act for masks and ventilator manufacturing.
    Go deeper: White House to recommend cloth masks amid COVID-19.
    Tesla tops expectations despite shutdowns
    Tesla (NASDAQ:TSLA) shares soared 12% AH as the EV maker revealed the production of almost 103K vehicles and deliveries of approximately 88.4K (12.2K Model S/X vehicles and 76.2K Model 3/Ys) to mark its best Q1 ever. The consensus analyst mark was for 79.9K deliveries after a series of recent downward revisions to account for the coronavirus impact. Tesla also said that its Model Y production started in January and deliveries began in March, significantly ahead of schedule.
    Mexico stops brewing Corona
    Since the start of the COVID-19 crisis, Corona has been the punchline of jokes and memes. Now, Grupo Modelo (OTC:GPMCF), which is part of brewing giant AB InBev (NYSE:BUD), has stopped producing Corona beer. The move is not associated with the drink's name, but the business was rather deemed non-essential under a Mexican government order. In the U.S., Grupo Modelo is distributed by Constellation Brands (NYSE:STZ).

    What else is happening...
    Jamie Dimon is back at work at JPMorgan (JPM)
    American (NASDAQ:AAL) slashes flights, but no plans to stop flying.
    Verizon (NYSE:VZ) network handling 'enormous' growth.
    Apple (NASDAQ:AAPL) postpones reopening of U.S. stores.
    Hiring... Facebook (NASDAQ:FB) to add 10K workers this year.
    'Virtual fest' for canceled SXSW films.
    Controversial NYSE (NYSE:ICE) high-speed data plan.
    Electrification boost as GM (NYSE:GM) expands EV partnership.
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  17. #42  
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    Quote Originally Posted by CoachCB View Post
    If oil keeps getting beat up maybe not. But, this is probably the most unusual period for oil since the early 80's oil embargo.

    Production will be cut (Trump or not) as the industry will soon run out of storage space.. as it is right now tankers are being used and that supply is running short.
    You could see sub 20 dollar oil if things don't unlock consumption wise.
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  18. #43  
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    Got oil? OPEC and its partners are expected to hold an emergency virtual meeting on April 8-9 in a concerted effort to stabilize markets after the meeting was pushed back from its original date of April 6. All eyes are on if Saudi Arabia, Russia and the U.S. will reach an agreement to take up to 15 million barrels of crude off the market. Heading into next week, Brent crude trades currently at $34.11 a barrel (+14% from Friday) and U.S. West Texas Intermediate stands at $28.34 (+12%) - with oil majors Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), Total (NYSE:TOT), BP (NYSE:BP) and Royal Dutch Shell (NYSE:RDS.A) (NYSE:RDS.B) all looking for positive developments to help start a recovery. No great surprise, but jobs are going to be a major focus again next week after 6.6M jobless claims came in. JPMorgan forecasts another 7M unemployment claims are coming down next week and some estimates range even higher. Other economic reports of note include the JOLTS update and a check on consumer prices, while the FOMC will drop the minutes from its latest meeting to the delight of Fed watchers.

    Earnings spotlight: Simply Good Foods (NASDAQ:SMPL) on April 6; Greenbrier (NYSE:GBX), Revlon (NYSE:REV), Levi Strauss (NYSE:LEVI) and Lindsay (NYSE:LNN) on April 7; PriceSmart (NASDAQ:PSMT) on April 8; and Delta Air Lines (NYSE:DAL), Shaw Communications (NYSE:SJR) and WD-40 (NASDAQ:WDFC) on April 9.
    Go deeper: See Seeking Alpha's complete list of earnings reporters
    IPO watch: There are no hints of a company going public next week, but IPO share lockups expire on BioNTech (NASDAQ:BNTX), HBT Financial (NASDAQ:HBT) and Vir Biotechnology (NASDAQ:VIR). Analysts can also start covering Imara (NASDAQ:IMRA). The biotech stock closed at $15.81 on Friday after the IPO was priced at $16 per share.

    Go deeper: Catch up on all the latest IPO news.
    M&A tidbits: The tender offer on the Forty Seven (NASDAQ:FTSV)-Gilead Sciences (NASDAQ:GILD) deal expires on April 6. Shareholders vote on the Anixter International (NYSE:AXE)-Wesco International (NYSE:WCC) merger on April 8. Look for more indications that the Caesars Entertainment (NASDAQ:CZR)-Eldorado Resorts (NASDAQ:ERI) deal and Delphi Technologies (NYSE:DLPH)-BorgWarner (NYSE:BWA) combination can make it to finish line.
    Costco: While traffic at Costco (NASDAQ:COST) stores has finally tailed off just a bit amid social distancing efforts, the retailer's report on March sales has the potential to be a head-turner. As a reminder, Costco saw U.S. comparable sales soar 12% in February as the consumer stockpiling trend first started to take off and the consensus mark for Costco's Q2 comparable sales (U.S., Canada and international) is at a healthy 9.3%. Buckle (NYSE:BKE), Cato (NYSE:CATO) and PriceSmart (PSMT) are also in line to issue monthly sales report.
    Airline traffic reports: Airline traffic reports will start arriving next week and could include some color on the devastating impact of the pandemic on load factors, earnings and government aid. Late on Friday, JetBlue (NASDAQ:JBLU) warned on a cash crunch, Delta Air Lines (DAL) said it's burning through $60M a day and United Airlines (NASDAQ:UAL) set the high-water for distress by disclosing that it's losing $100M a day. It's likely to be another week of volatile trading for those three carriers as well as American Airlines Group (NASDAQ:AAL), Southwest Airlines (NYSE:LUV), Hawaiian Holdings (NASDAQ:HA), Alaska Air Group (NYSE:ALK), Allegiant Travel (NASDAQ:ALGT), Spirit Airlines (NYSE:SAVE), Mesa Air Group (NASDAQ:MESA) and SkyWest (NASDAQ:SKYW).
    Business updates: Incyte (NASDAQ:INCY) is scheduled to discuss Phase 3 data on Ruxolitinib Cream for Atopic Dermatitis on April 6. RLH (NYSE:RLH) has a conference call set for April 6 to discuss organizational changes. PAVmed (NASDAQ:PAVM) is hosting a conference call on April 9, with CEO Lishan Aklog expected to provide an overview of the company's near-term milestones and growth strategy. FedEx (NYSE:FDX) is on tap to deliver its monthly economic update and projections on April 10.

    Voice of the Car Summit: The connect car event on April 7-8 has switched to an online format due to the pandemic. The all-star roster of speakers includes execs from Mercedes-Benz (OTCPK:DDAIF), Google (NASDAQ:GOOG) (NASDAQ:GOOGL), iHeartMedia (NASDAQ:OTC:IHRT), LinkedIn (NASDAQ:MSFT), Ford (NYSE:F) and Intel (NASDAQ:INTC). The expected timeline and uses for 5G-based cellular connectivity into cars could be an interesting topic.
    Restaurants: The restaurant industry will be put to the test again next week as operators continue to look for takeout/delivery workarounds to keep at last some revenue coming in. Analysts expect the industry could look different on the other side of the pandemic. Cowen's Andrew Charles sees Domino's Pizza (NYSE:DPZ) and Papa John's International (NASDAQ:PZZA) nabbing market share from independents and value-minded chains like Red Robin Gourmet Burgers (NASDAQ:RRGB) and Olive Garden (NYSE:DRI) resonating in a harsh economy. The pivot for chains focused in dense urban areas isn't quite so simple. Shake Shack (NYSE:SHAK) isn't standing still, already adding Uber Eats (NYSE:UBER) and DoorDash (DOORD) as delivery options and partnering on cook-at-home burger kits.
    Short report: The list of short favorites is worth taking a look at amid the wild market swings. While Blue Apron (NYSE:APRN) and Peloton Interactive (NASDAQ:PTON) have defied the market collapse as favorite stay-at-home stock picks, there are plenty of short picks cooperating. Looking ahead to next week, the list of high short interest names includes GameStop (NYSE:GME), Match Group (NASDAQ:MTCH), Gogo (NASDAQ:GOGO), Mallinckrodt (NYSE:MNK), SmileDirectClub (NASDAQ:SDC), Tanger Factory Outlet (NYSE:SKT), Carvana (NYSE:CVNA), AMC Entertainment (NYSE:AMC), Dillard's (NYSE:DDS), Stitch Fix (NASDAQ:SFIX), Wayfair (NYSE:W) and Carvana (CVNA). On a pure dollar basis, Tesla (NASDAQ:TSLA) is also near the top list with short interest standing at over $8B. Then in what would have been a shocking development a few months ago, short interest on Nike (NYSE:NKE), Starbucks (NASDAQ:SBUX) and Home Depot (NYSE:HD) has moved much higher than historic norms.

    Wells Fargo Biotech Corporate Access Day Virtual Conference Boston 2020: The biotech conference has gone to online presentations, but should still be just as intriguing. Look for updates from uniQure (NASDAQ:QURE), Adaptimmune Therapeutics (NASDAQ:ADAP), Affimed (NASDAQ:AFMD), Akcea Therapeutics (NASDAQ:AKCA), Applied Genetic Technologies (NASDAQ:AGTC), Arena Pharmaceuticals (NASDAQ:ARNA), Autolus Therapeutics (NASDAQ:AUTL), AVROBIO (NASDAQ:AVRO), bluebird bio (NASDAQ:BLUE), Celyad (NASDAQ:CYAD), Crispr Therapeutics (NASDAQ:CRSP), Gritstone Oncology (NASDAQ:GRTS), IMV (NASDAQ:IMV), Infinity Pharmaceuticals (NASDAQ:INFI), Jounce Therapeutics (NASDAQ:JNCE), MEI Pharma (NASDAQ:MEIP), Momenta Pharmaceuticals (NASDAQ:MNTA), MyoKardia (NASDAQ:MYOK) and Voyager Therapeutics (NASDAQ:VYGR).
    Virtual biotech conferences: The online Goldman Sachs Cell Therapy Day conference will feature presentations from Allogene Therapeutics (NASDAQ:ALLO), TCR2 Therapeutics (NASDAQ:TCRR) and Precision Biosciences (NASDAQ:DTIL). The Canaccord Genuity Horizons in Oncology Conference on April 8 also includes an online presentation by Allogene Therapeutics, along with IGM Biosciences (NASDAQ:IGMS).
    Videogames check: Analysts seem to be in disagreement on whether the closing of many retail stores will be offset by the boost in digital sales amid the pandemic. On the positive side, there has been an increase in Twitch viewership and Steam users to go along with explosive sales of Nintendo's (OTCPK:NTDOY) Animal Crossing. However, that burst of energy comes against a long streak of monthly declines in videogame sales ahead of the console refresh cycle. The next test of the market could be Activision Blizzard's (NASDAQ:ATVI) release of Call of Duty: Modern Warfare Season 3 on April 8.
    Annual meetings: Annual meetings on the calendar include Rio Tinto (NYSE:RIO) on April 8, as well as Adobe (NASDAQ:ADBE) and Synopsys (NASDAQ:SNPS) on April 9. Needless to say, those events will be of virtual variety.
    Furlough Nation: The shock of the massive amount of furloughing of U.S. employees will wear off a little bit next week to leave the question of what does it mean for investors? Analysts say the crisis management skills of top execs and the strength of the underlying businesses will be the critical factors in seeing share prices recover. A partial list of companies that instituted furloughs includes Macy's (NYSE:M), Kohl's (NYSE:KSS), J.C. Penney (NYSE:JCP), Stage Stores (NYSE:SSI), Ross Stores (NASDAQ:ROST), Gap (NYSE:GPS), L Brands (NYSE:LB), Urban Outfitters (NASDAQ:URBN), Simon Property Group (NYSE:SPG), Buckle (BKE), Cato (CATO), Guess (NYSE:GES), Children's Place (NASDAQ:PLCE), Marriott International (NASDAQ:MAR), Tilly's (NYSE:TLYS), Express (NYSE:EXPR), Ascena Retail (NASDAQ:ASNA), Chico's (NYSE:CHS), Movado (NYSE:MOV), Genesco (NYSE:GCO), Caleres (NYSE:CAL), Steven Madden (NASDAQ:SHOO), G-III Apparel (NASDAQ:GIII), Disney (NYSE:DIS), La-Z-Boy (NYSE:LZB), Ethan Allen (NYSE:ETH), Havertys (NYSE:HVT), Casper Sleep (NYSE:CSPR), Five Below (NASDAQ:FIVE), Sysco (NYSE:SYY), Cheesecake Factory (NASDAQ:CAKE), Shake Shack (SHAK), Ruth's Hospitality (NASDAQ:RUTH), SeaWorld Entertainment (NYSE:SEAS), Polaris (NYSE:PII), Caesars Entertainment (CZR), Funko (NASDAQ:FNKO), Gannett (NYSE:GCI), American Eagle Outfitters (NYSE:AEO), and MarineMax (HAZO).

    Barron's mentions: The tough stretch ahead for the advertising industry is profiled in detail, with spending expected to be down sharply. On the digital side, Facebook (NASDAQ:FB) and Twitter (NYSE:TWTR) have already warned that they will take a hit from the downturn, while Alphabet's Google is also likely to be hurt. Cable players AMC Networks (NASDAQ:AMCX), ViacomCBS (NASDAQ:VIAC) and Discovery (NASDAQ:DISCA) face advertising dollars drying up, subscription services growth and a lack of sports programming in a triple whammy could set the stage for an acceleration in the long-running cord-cutting trend. Sharp revenue drops are also expected for New York Times (NYSE:NYT), News Corp (NASDAQ:NWSA), Meredith (NYSE:MDP), Gannett (GCI), Clear Channel Outdoor Holdings (NYSE:CCO), Outfront Media (NYSE:OUT), iHeartMedia (OTC:IHRT) and Cumulus Media (NASDAQ:CMLS). The largest U.S. media businesses have seen as being better off, but trouble areas are still on the road ahead for Comcast (NASDAQ:CMCSA), AT&T (NYSE:T) and Walt Disney (DIS). The publication also sets out a list of biotechs to own for a post-pandemic world. Gilead Sciences (GILD), Blueprint Medicines (NASDAQ:BPMC), WuXi Biologics (OTC:WXIBF), WuXi Apptec (OTCPK:WUXAY), Invitae (NYSE:NVTA), bluebird bio (BLUE), Fate Therapeutics (NASDAQ:FATE) and Crispr Therapeutics (CRSP) make the cut.
    Sources: CNBC, Bloomberg, Nikkei Asian Review, Reuters, EDGAR, S3 Partners.
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  19. #44  
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    Global Market Comments
    April 6, 2020
    Fiat Lux

    Featured Trade:
    (MARKET OUTLOOK FOR THE WEEK AHEAD, or MAD HEDGE GOES POSITIVE ON THE YEAR)
    (INDU), (SPY), (VIX), (VXX), (AMZN), (MSFT), (BAC), (JPM)



    The Market Outlook for the Week Ahead, or Mad Hedge Goes Positive on the Year

    There is no doubt that the Corona epidemic will be the WWII challenge of our generation. Since we are Americans, we will rise to the task. We all have our jobs to do, being it working as a front-line medical professional, or simply staying at home.

    We will get through this.

    I was standing in front of a Reno gun store yesterday waiting my turn to enter. Under Nevada’s strict shelter-in-place rules, only one person is allowed to enter a store at a time. I needed some ammo and black powder for my 1860 Army Colt revolver, which is hard to find in California.

    I struck up a casual conversion about the epidemic with other waiting customers on a clear, brisk Nevada morning. A blue-collar worker with an AR-15 said he really wasn’t paying attention to it. A hispanic gang member with a heavily tattooed neck and fingers looking for a box a 9mm Glock shells confessed he hadn’t heard about it. A white nationalist with a heavily militarized SUV argued that the whole thing was a left-wing conspiracy meant to discredit Donald Trump.

    Which can only mean one thing.

    The worst days of the of the epidemic are ahead of us, as are the consequences for the stock market. Remember, 40% of the country don’t read newspapers or watch the news and be only barely aware of the seriousness of the disease.

    The White House us currently forecasting 12 million cases and 250,000 deaths. That’s just an optimistic guess. Only one third of the country started their shutdowns early, one third were late, and the last third not at all. This means that the highest death rates will be in southern and midwestern states that are following the presidents advance and dismissing the epidemic out of hand, refusing to wear face masks.

    So, we are really looking at a potential US 120 million cases and 2.4 million deaths. On that scale the food distribution system will start to break down for shear lack of workers. No one really knows how effective shelter-in-place will be, although the early data is encouraging. We are all living in one giant experimental petri dish right now.

    And we will be the lucky country. Deaths in the Southern Hemisphere, which is just going into the winter, will be much higher.

    Anytime I consider adding a long position, I first ask myself how it will stand up against a picture on the front page of the New York Times showing a pile of a thousand bodies outside a local hospital. I saw that sort of thing in Asia a half century ago. Markets will crash.

    The game we are now in for the coming weeks is to trade an $18,000 to $22,000 range in the Dow Average. The sharp selloff in the Volatility Index (VIX) last week, which we caught with both hands, suggests that the next retest of the $18,000 low will be successful.

    Further down the road, I’m not so sure. Any prediction beyond tomorrow in this environment is dubious at best. The world is moving on fast-forward now and the unbelievable is happening every day.

    But here’s a shot. If the $18,000 to $22,000 range doesn’t hold, then we are moving to a $15,000 to $18,000 range. If that fails, then we are looking at $12,000 to $15,000 range. Then we will be looking at Great Depression levels of stock market sell-off, with a total corporate capitalization loss of an eye-popping $17 trillion.

    The great challenge here is to buy your best stocks and LEAPs as low as possible before an unprecedented $6 trillion in federal stimulus that is coming our way. There will be the $2 trillion in jobs and corporate bailout money already passed, a $2 trillion infrastructure bill coming, and a second jobs and bailout bill that will be needed. On top of that, the Federal Reserve has committed to $8 trillion backstopping of the financial.

    And here is the problem. Trump has spent the last three years shrinking the government. The pandemic is a very large government event. So, the Feds may simply not have enough bodies in place to spend, or to lend, all the money that has already been authorized.

    That is your economic and market risk.

    There is no doubt that the next month will be grim. The U-6 Unemployment Rate published on Friday was 8.9%, indicating the total number of jobless is already at 14.4 million. If the Fed is right and we soon hit 32%, total joblessness will soar to 52 million. During the Great Depression, that unemployment rate peaked at only 25%, throwing 20 million out of work. We could exceed those levels in the coming week!

    Dr. Fauci predicts 200,000 US deaths. I think that’s a low number, given that 100 million Americans are still not sheltering-in-place. Corona is starting to take its toll on Wall Street, claiming the life of the Jeffries CFO, Peg Broadbent. Every state and city should prepare for a New York-style spike in cases.

    The Fed is expecting 47 million unlucky individuals to lose jobs. This week, Macy’s (M) chopped 150,000, while Tillman Fertitta laid off 40,000 restaurant workers in place like Morton’s Steakhouse and the Bubba Gump Shrimp Company. Many more are to come. Weekly Jobless Claims have already exploded to 6.64 Million. That is three full recessions worth of job losses in two weeks.

    The March Nonfarm Payroll Report was a disaster. Here is another number to put in your record book of awful numbers, the report showing 701,000 job losses in March. It’s the first negative number since 2010. Leisure & Hospitality fell by a staggering 459,000.

    A second Corona wave might arrive in the fall, warns JP Morgan (JPM). We may not have visited the Volatility Index at $80 for the last time. I’m setting up more (VXX) shorts if we do revisit there. Sell all substantial stock market rallies.

    It’s worse than you think. Brace yourself. Bank of America (BAC) has come out with the first GDP forecast I’ve seen that factors in a second wave of Coronavirus cases in the fall. It is not a pretty picture. They see every quarter of 2020 as coming in negative. These easily takes US GDP back to levels not seen since the Obama administration. The only consolation is that (BAC) has never been that great at forecasting the economy, basically leaving it to a bunch of kids. Here they are:

    2020 Q1 -7%
    2020 Q2 -30%
    2020 Q3 -1%
    2020 Q4 -30%

    Oil rich countries will have to dump $225 billion in stocks, thanks to the collapse of oil to a once impossible $20 a barrel. An 80% plunge in national revenues is forcing asset sales at fire sale prices to avoid a brewing revolutions. They don’t retire former heads of states to golf clubs in the Middle East, they stand them up in front of a firing squads.

    Oil Hit an 18-year low at $19.30 a barrel and it could get a lot worse. All of the world’s storage is full, so producers might have to PAY wholesalers to take Texas tea off their hands. Yes, negative oil prices are possible. Otherwise, producing wells will be permanently damaged with a total shutdown. Most of the industry has a negative net worth, save the majors. I told you to stay away!

    China PMIs turn positive, coming in at 52 versus an expected 45indicating a recovering economy. Watch the Middle Kingdom’s economic data more than usual. US PMIs are still in free fall. However, consumers still are staying at home. Their economy went first into the epidemic and will be the first out. There’s hope for us all the quarantine is working.

    A $2 trillion infrastructure budget is in the works, and the Democrats will support it because the money won’t be spent until they get control of government in 2021. With most of the construction industry closed, the government’s cumbersome bidding process can’t even start until the summer.

    You wonder how that last $2 trillion rescue package got done in five days? This will take us to Great Depression levels of bailout spending. The Fed balance sheet has exploded from $3.5 trillion to $5 trillion in weeks. I know 10,000 bridges that need to be fixed.

    When we come out the other side of this, we will be perfectly poised to launch into my new American Golden Age, or the next Roaring Twenties. With interest rates at zero, oil at $20 a barrel, and many stocks down by three quarters, there will be no reason not to. The Dow Average will rise by 400% or more in the coming decade.

    My Global Trading Dispatch performance had a spectacular week, blasting my performance back to positive numbers for the year. That is thanks to the ten-point collapse in the Volatility Index (VIX) on Thursday and Friday, which had a hugely positive effect on all our positions.

    We are now up an amazing +11.02% for the first three days of April, taking my 2020 YTD return up to +2.60%. We are a mere 68 basis points short of an all-time high. That compares to an incredible loss for the Dow Average of -28.8%, with more to go. My trailing one-year return was recovered to 46.74%. My ten-year average annualized profit recovered to +34.85%.

    My short volatility positions (VXX) are almost back to cost. I used every rally in the Dow Average to increase my short positions in the (SPY) to almost obscene levels. Now we have time decay working big time in our favor. These will all come good well before their ten-month expiration.

    I bought two very deep in-the-money, very short-dated call spreads in Amazon (AMZN) and Microsoft (MSFT), the two safest companies in the entire market, betting that we don’t go to new lows in the next nine trading days.

    At the slightest sign of a break in the pandemic, the economy and shares should come roaring back. Right now, I have a 30% cash position.

    All economic data points will be out of date and utterly meaningless this week. The only numbers that count for the market are the number of US Coronavirus cases and deaths, which you can find updates at https://coronavirus.jhu.edu.

    On Monday, April 6 at 6:00 AM, the Consumer Inflation Expectations for March are out.

    On Tuesday, April 7 at 9:00 AM, the US JOLTS Job Openings Report is published.

    On Wednesday, April 8, at 2:00 PM, the Fed Minutes for the previous meeting six weeks ago are released.


    On Thursday, April 9 at 8:30 AM, Weekly Jobless Claims are announced. The number could top 3,000,000 again.

    On Friday, April 10 at 7:30 AM, the US Core Inflation is released. The Baker Hughes Rig Count follows at 2:00 PM. Expect these figures to crash as well.

    As for me, I have temporarily moved back to Oakland to retrieve my printer. As I left, my Tahoe neighbors told me I was nuts to go back to a big city. I then drove across an almost totally vacated Golden State, emptied by a pandemic.

    With my free time, I have planted a victory garden. I managed to obtain tomatoes, eggplants, chili peppers, strawberries, lettuce, and bell peppers from the nearest Home Depot (HD) garden center. In two weeks, I should have something new to eat.

    Stay healthy.

    John Thomas
    CEO & Publisher
    The Diary of a Mad Hedge Fund Trader












    Still Sheltering in Place


    Quote of the Day

    “This is not a time to go to the grocery store or the pharmacy,” said Dr. Deborah Birx, coordinator of the White House Coronavirus task force.


    This is not a solicitation to buy or sell securities
    The Mad Hedge Fund Trader is not an Investment advisor
    For full disclosures click here at:

    http://www.madhedgefundtrader.com/disclosures

    The "Diary of a Mad Hedge Fund Trader"(TM)
    and the "Mad Hedge Fund Trader" (TM)
    are protected by the United States Patent and Trademark Office
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  20. #45  
    RX Junior
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    1000 ROM.. Bought @ 99. Friday
    Sold @ 112. Just now

    Mad Hedge Hot Tips
    April 6 2020
    Fiat Lux

    The Five Most Important Things That Happened Today
    (and what to do about them)


    Stocks Soar on Falling Death Rates. Chinese cases are falling after the border close, Italy and Madrid are going flat, and San Francisco is looking good. There is still a massive, but extremely nervous bid under the market. I’m selling into this rally. We will continue to chop in a (SPY) $218-$265 range for the foreseeable future.

    Click here to read the rest of today's Hot Tips



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  21. #46  
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    Gap up up 10% this week...Bull market?
    I'd doubt it.




    Why Globalization Works

    I am writing this to you from the Amtrak California Zephyr.

    I am riding the rails in a first class sleeping compartment from Oakland, CA to Truckee, CA to reposition a car from my Lake Tahoe lakefront estate now that winter is over.

    Pulling out of the station, I couldn’t help but notice the gigantic cargo ships from China and South Korea unloading containers by the tens of thousands.

    Mountains of these containers dot the horizon.

    The cranes used to automatically unload them were the models for George Lucas’s AT walkers in Star Wars.

    I tell my kids that this year’s Christmas presents are in there somewhere.

    Having been a vociferous supporter of globalization since its dawn a half century ago, first during a decade spent as a reporter for The Economistmagazine, and then as an investor, I will explain how our international trading system works, and especially why it works for us.

    There was a polyglot of travelers from all over the world on my train.

    Large groups of Chinese were led by flag bearing guides.

    Italian Millennials mobbed the bar.

    A retired English couple strolled the observation car.

    There was even the occasional American student backpacker repeating my own adventure from the 1960s.

    And you know what? This disparate international group shared many things in common.

    Most of them spent much of the day glued to iPhones or Androids run by US-designed apps.

    Many were staying in accommodations organized by Airbnb.

    Like me, they may have made the trip to the train station in an Uber cab.

    They wore Levi Strauss blue jeans. American pop music pulsed through their ear buds. Probably half of them arrived in America on a Boeing jet financed by the Export-Import Bank of the U.S.

    In short, they were all sending enormous amounts of money to US companies and shareholders in more ways than they could possible count without realizing it.

    You never used to see tourists from most countries, like Russia, Spain, Portugal, Italy, or Ireland.

    They were too poor.

    Rapidly rising standards of living created by globalization changed all of that, creating an enormous new market for American products, especially technology ones.

    You can see some of this impact in international balance of trade statistics. In 2018, the US ran a trade deficit with the world of $891.3 billion, an all-time high, with consumer electronics, oil, clothes, and cars our largest imports.

    There is a more elegant way to describe this trade. We are, in fact, running a massive goods surplus, where foreigners send us $891.3 billion worth of stuff and we give them paper in return, US dollars, which has been steadily depreciating in value for the past 50 years.

    Who is the big winner here? The US consumer, i.e. you and I. Sounds like a good deal to me. Without this inflow of cheap goods, the US inflation rate would be at least double or triple what it is now.

    Subtract our $402.8 billion surplus in services, which includes, financial services, education, patents, and other intellectual property, and that brings our current account deficit down by more than half to only $488.5 billion. Some 78.6% of private sector US GDP is now accounted for by services.

    But that doesn’t tell the whole story.

    Trade data completely miss the enormous number of products and services that are now given away FOR FREE in exchange for the chance of earning some uncertain revenue at some future date.

    In a pre-Internet, pre-globalized world, a service like the Diary of a Mad hedge Fund Trader covering so many asset classes and individual stocks real-time might have cost $100,000, if not $1 million.

    And you know what? It would have been worth it!

    Multiply this effect on a global scale and you’ll see what I am talking about.

    Give up your name, email address, and your phone number and you can obtain almost any kind of online service for nothing. And as far as I know, no government agency has any measurement of this whatsoever.

    Needless to say, the United States is far and away the leader in this immeasurable field.

    By the way, this might also be the reason why the published productivity data has been so poor despite the fact that US GDP has grown by 20% since 2009. Everywhere I look, productivity is skyrocketing, including my own.

    It also might be the reason why Amazon continuously sports a nosebleed valuation. Much of what they provide is FREE, and therefore immeasurable.

    Of course, globalization wrought havoc on your life if you went into it with the wrong job in the wrong industry and an inadequate skill set.

    Blue collar workers tied to textiles, shoes, toys, and other low value-added manufacturing were toast as their jobs fled offshore.

    If you didn’t retrain or adapt, you became an angry, mostly white man.

    As my friend, New York Times columnist Tom Friedman, likes to say, “Average doesn’t cut it anymore.”

    However, while the jobs are gone, the bulk of the profits stayed here in the US. American companies offshored the $2 an hour jobs (mass assembly), but kept the $150 an hour ones (design and marketing).

    As my friends in the Chinese government never fail to point out, if they build the iPhone for $100 and we sell it $1,000, we are the big winners, not them.

    They believe we are perpetuating 19th century colonialism by making wage slaves of their workers.

    They are correct.

    Globalization enables the US dollar to continue as the world’s reserve currency, as almost all international trade is conducted in the buck.

    That is one of the greatest free lunches of all time.

    It enables the US government to indirectly control the global economy through its own monetary policy. Some half of all of the $22 trillion in US government debt is owned by foreigners.

    When sanctions forced Iran to drop out of the international trading system, what did they get? A Great Depression that cut their GDP by 25%. You can’t run a country of 80 million with oil barter deals, gold, and bitcoins alone.

    There is also the huge defense benefits that globalization brings us.

    Back in the early days, the main reason to steer a country into capitalism was to prevent it from going communist, and therefore becoming an enemy.

    Grow your allies and shrink your enemies, and your defense costs shrink dramatically, raising our friends’ standards of living.

    That is what has happened on a massive scale.

    Increased trade also boosted foreign standards of living, therefore creating a growing market for American goods and services.

    This was the whole point of the World Trade Organization, NAFTA, the Trans-Pacific Partnership.

    Humans rarely bite the hands that feed them. They are also highly unlikely to set fire to their paycheck or bomb the sources of income.

    Make a foreigner a millionaire, and you turn him into a pacifist. I have seen this unfold time and again over the past half-century, be it in China, Russia, Vietnam, Cambodia, and most recently in Iran.

    Create an embedded base of businessmen in any country who are getting rich off of you, and international relations invariably improve.

    Any system based on greed is guaranteed to succeed.

    A side benefit of all of this is that stock markets for up forever.

    Since globalization started in earnest in 1951, the Dow Average has risen from $239 to $21,800, a prodigious gain of some 92-fold.

    And you wondered why?

    Globalization is the mechanism through which America is paid the dividend for all of the good deeds it has done and inventions it has created for the past century.

    I am thinking about the construction of the Panama Canal, Lend Lease, and the Marshall Plan, as well as the transistor, memory chip, microprocessor, personal computer, Windows, the Internet, online commerce, the iPhone, and social media.

    That is why globalization is a win-win-win for everyone.

    There are really only two true communist countries left in the world, Cuba and North Korea, which never joined the international trading community. They also happen to have the planet’s lowest standard of livings.

    And Cuba will become totally capitalist within two years. Just give them a million iPhones, get them talking, and see what happens. Castro will become just another neighborhood in South San Francisco.

    So why end a trading system from which America and its people have profited so mightily?

    That is a very good question, one that someone might ask our president.



    AT-AT Walkers from Star Wars




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  22. #47  
    RX Junior
    Join Date
    Dec 2007
    Location
    Oregon Coast
    Posts
    317
    Global Market Comments
    April 9, 2020
    Fiat Lux

    Featured Trade:
    (TEN LONG TERM LEAPS TO BUY AT THE BOTTOM)
    (MSFT), (AAPL), (GOOGL), (QCOM), (AMZN),
    (V), (AXP), (NVDA), (DIS), (TGT)



    Ten Long Term LEAPS to Buy at the Bottom

    I am often asked how professional hedge fund traders invest their personal money. They all do the exact same thing. They wait for a market crash like we are seeing now and buy the longest-term LEAPS (Long Term Equity Participation Securities) possible for their favorite names.

    The reasons are very simple. The risk on LEAPS is limited. You can’t lose any more than you put in. At the same time, they permit enormous amounts of leverage.

    Two years out, the longest maturity available for most LEAPS, allow plenty of time for the world and the markets to get back on an even keel. Recessions, pandemics, hurricanes, oil shocks, interest rate spikes, and political instability all go away within two years and pave the way for dramatic stock market recoveries.

    You just put them away and forget about them. Wake me up when it is 2022.

    I put together this portfolio using the following parameters. I set the strike prices just short of the all-time highs set two weeks ago. I went for the maximum maturity. I used today’s prices. And of course, I picked the names that have the best long-term outlooks.

    You should only buy LEAPS of the best quality companies with the rosiest growth prospects and rock-solid balance sheets to be certain they will still be around in two years. I’m talking about picking up Cadillacs, Rolls Royces, and even Ferraris at fire sale prices. Don’t waste your money on speculative low-quality stocks that may never come back.

    If you buy LEAPS at these prices and the stocks all go to new highs, then you should earn an average 131.8% profit from an average stock price increase of only 17.6%.

    That is a staggering return 7.7 times greater than the underlying stock gain. And let’s face it. None of the companies below are going to zero, ever. Now you know why hedge fund traders only employ this strategy.

    There is a smarter way to execute this portfolio. Put in throw-away crash bids at levels so low they will only get executed on the next cataclysmic 1,000-point down day in the Dow Average.

    You can play around with the strike prices all you want. Going farther out of the money increases your returns, but raises your risk as well. Going closer to the money reduces risk and returns, but the gains are still a multiple of the underlying stock.

    Buying when everyone else is throwing up on their shoes is always the best policy. That way, your return will rise to ten times the move in the underlying stock.

    If you are unable or unwilling to trade options, then you will do well buying the underlying shares outright. I expect the list below to rise by 50% or more over the next two years.

    Enjoy.

    Microsoft (MSFT) - March 18 2022 $180-$190 bull call spread at $2.67 delivers a 274% gain with the stock at $190, up 16% from the current level. As the global move online vastly accelerates the world is clamoring for more computers and laptops, 90% of which run Microsoft’s Windows operating system. The company’s new cloud present with Azure will also be a big beneficiary.

    Apple (AAPL) – June 17 2022 $210-$220 bull call spread at $6.47 delivers a 55% gain with the stock at $226, up 14% from the current level. With most of the world’s Apple stores now closed, sales are cratering. That will translate into an explosion of new sales in the second half when they reopen. The company’s online services business is also exploding.

    Alphabet (GOOGL) – January 21 2022 $1,500-$1,520 bull call spread at $7.80 delivers a 28% gain with the stock at $226, up 14% from the current level. Global online searches are up 30% to 300%, depending on the country. While advertising revenues are flagging now, they will come roaring back

    QUALCOMM (QCOM) – January 21 2022 $90-$95 bull call spread at $1.55 delivers a 222% gain with the stock at $95, up 23% from the current level. We are on the cusp of a global 5G rollout and almost every cell phone in the world is going to have to use one of QUALCOMM’s proprietary chips.

    Amazon (AMZN) – January 21 2022 $2,100-$2,150 bull call spread at $17.92 delivers a 179% gain with the stock at $2,150, up 15% from the current level. If you thought Amazon was taking over the world before, they have just been given a turbocharger. Much of the new online business is never going back to brick and mortar.

    Visa (V) – June 17 2022 $205-$215 bull call spread at $3.75 delivers a 166% gain with the stock at $215, up 16% from the current level. Sales are down for the short term but will benefit enormously from the mass online migration of new business only. They are one of a monopoly of three.

    American Express (AXP) – June 17 2022 $130-$135 bull call spread at $1.87 delivers a 167% gain with the stock at $135, up 28% from the current level. This is another one of the three credit card processors in the monopoly, except they get to charge much higher fees.

    NVIDIA (NVDA) – September 16 2022 $290-$310 bull call spread at $6.90 delivers a 189% gain with the stock at $310, up 19% from the current level. They are the world’s leader in graphics card design and manufacturing used on high-end PCs, artificial intelligence, and gaining. They befit from the soaring demand for new computers and the coming shortage of chips everywhere.

    Walt Disney (DIS) – January 21 2022 $140-$150 bull call spread at $2.55 delivers a 55% gain with the stock at $116, up 31% from the current level. How would you like to be in the theme park, hotel, and cruise line business right now? It’s in the price. Its growing Disney Plus streaming service will make (DIS) the next Netflix.

    Target (TGT) – June 17 2022 $125-$130 bull call spread at $1.40 delivers a 257% gain with the stock at $130, up 16% from the current level. Some store sales are up 50% month on month and lines are running around the block. Their recent online growth is also saving their bacon.


    Looks Like a “BUY” signal to Me


    Quote of the Day"Every attempt to make war easy and safe will result in humiliation and disaster," said the Civil War General, William T. Sherman.






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  23. #48  
    RX Member
    Join Date
    Dec 2012
    Location
    boston
    Posts
    149
    Great stuff! Never traded options before, but will certainly give this approach a try on a down market day.
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  24. #49  
    RX Junior
    Join Date
    Dec 2007
    Location
    Oregon Coast
    Posts
    317
    Market volatility has thrown off all the markets ACCEPTED, time tested approaches to price analysis.I guess everyone is getting a pass right now?
    It's going to be interesting to see balance sheets next week, anyone in a cash crunch /Auto/Airlines/Hotels should drag things down a bit.
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