Thrill Ride Thursday: Data Hurts So Good [View article]
Oh MY GOD - are you serious??? Do you actually believe that?
You (Conservatives - although what a joke that label is) took the money FROM the people who WORKED for it and you spent it on your ridiculous wars and, of course, to relieve the rich of their own ordinary obligations to be taxed like everyone else.
You're not GIVING people anything in SS and Medicare other than their own money back with the interest that's due to them - none of which is there BECAUSE YOU STOLE IT!
When the victim of a robbery asks that the thief gives the money back - that is not then charity on the part of the thief (sorry - "job creator").
The money was all there - Al Gore wanted to put it in a "lock box" and we were on track to pay off our entire $3.6Tn deficit in 12 years under the last Clinton Budget but then GW says - "hey, that surplus is our money (meaning rich people's, apparently) and we need to give it back to the American people (meaning the rich ones).
So he spent the surplus that was supposed to pay off the debt and then he spent another $8Tn he didn't have on more tax breaks and more wars, leaving a $11Tn hole for Obama - as well as a crisis of biblical proportions (and Government spending that had doubled under Bush and has gone down since Obama took office but too late to stop the deficit train from adding $5Tn more debt).
So it's not the "leftist" mentality you should be wondering about but the "rightist" BS you seem to swallow whole and regurgitate as if it had some basis in reality and not, as you say, from the twilight zone.
I did not attack Disney, I quoted an article on Disney but yes, when you work people to death in poor conditions in a labor market that offers them no escape and leads to feelings of hopeless entrapment - suicides do happen.
We spoke last week about the suicides at the AAPL plant (so forgive me for not footnoting my citations EVERY time I mention something) and again - What is the difference between your IPhones being made by people who make $150 a month and sleep 10 to a dorm room with no retirement or health care and actual slaves? What? The fact that they can quit that job and starve to death somewhere else?
Grow up people, our whole lifestyle is currently built on slave labor. We couldn't exploit the workers over here so we "outsourced" the exploitation overseas.
Am I a Maxist? Well, when did Marxist become a bad thing? Marx was a philospher and communism is a legitimate form of economic organization that is the polar opposite of capitalism and Marx was a philosopher (I know, what's that) that studied both. I quoted Aristotle above - does that make me an Aristotlist?
Marx pointed out that the inevitable strains placed upon the working class by the capitalist wheels of production would end in revolution and, it turns out, he was right. Over 160 years later we are busy recreating all the evils of early Industrial Capitalism that Marx observed at the time (1848) but I'll be there's not 5 people reading this comment who've actually read the Communist Manifesto.
In the very least, try reading the Wikipedia entry before the next time you feel the urge to cry "Marxist" at anyone who suggests Capitalism may have some flaws: en.wikipedia.org/wiki/...
This was only a review of the trades that were posted, for free, right here on Seeking Alpha. Of course you wouldn't know that because you would rather criticize before checking your facts.
You are right though, giving anything away is a complete waste of time because there are always people like you looking to spit at every warm gesture made by others.
Did I hide my motives? Was it a trick? Am I even asking people to become high-paying Members or am I discussing my $49/month Newsletter service?
I see this is your first comment and you have no bio - I don't know why Seeking Alpha allows it's authors to be attacked by anonymous nobodies like this either. Are you a rival service - what's your record look like? What picks have you given people this week on your blog?
Every single thing I discuss above can be found by reading my last 4 articles this week. Don't worry though, I don't usually give out that many free trades, this was just one of those weeks where I got some free advertising in exchange for 5 days of posts you obviously didn't bother reading before criticizing.
Friday's Market Blow - Jobs or No Jobs? [View article]
Howard, Do you know what you are saying is grossly mis-leading or do you only read Conservative studies that distort the facts that lead to your grossly mis-aligned views?
Your lack of citations when quoting statistics is telling as this was a "study" by the Commonwealth Foundation who's MISSION STATEMENT is "Promoting the use of economic reasoning to understand a world of scarcity, trade-offs, and the unseen consequences of governmental solutions to societal problems."
The reason Iowa ranks highest in SAT scores is only 3% of the students in Iowa take the SAT. Why is that? Because 97% of the students in Iowa have little or no hope of attending college due to the low per capital education spending!
Only the most exceptional students in Iowa end up taking the SATs in the first place and what a waste of talented minds that these poor children live in a state where education was one of the lowest priorities of any state in the country.
In Minnesota, it's 7% of the students and both Wisconsin and Missouri score 4%. Michigan came in with just 5% and South Dakota 3% - all low spenders on education.
Pennsylvania (where the Commonwealth Foundation was trying to prove that spending on education is a waste) spent $20,000 per student on education (and, of course the cost of living is miles different in PA so apples to oranges) but 71% of their students took the SATs - indicating a tremendously high degree of expectations of post-graduate studies.
Rather than "proving" money spent on education is a waste - this study proves the incredible effect of doubling spending as it has a 20x multiplier effect on the number of students who are prepared to move on to college after high school.
YOU sir, are the reason this country is going down the drain. YOU are the reason America becomes uncompetitive and YOU are contributing to the squandering of America's greatest natural resource - our own people and what they can accomplish if we just gave them a chance....
Now, let's look at a real study - one done by the College Board that administers the SATs:
Notice in table 11 that FAMILY INCOME is an ABSOLUTE predictor of scores with a 25% average difference between the top 10% (family incomes over $200,000) and the bottom 20% (family incomes under $20,000). The $20-40K group scarcely did better and even families with $40-60K income and we are now talking about 60% of the American people, scored an average of 15% lower than those in the privileged families.
Parental education was an even more extreme indicator with the children of Graduates scoring 1,690 on average vs 1,287 (24% less) for High-School drop-outs and 1,461 (13.5% less) for High School Graduates.
So next time you spit down in disgust as you step over a homeless person Howard, perhaps use your pampered mind to consider for just a moment how you yourself are working to condemn that person, people like them and their families to an endless and virtually unbreakable cycle of poverty and despair - an entire group of 120M people (the bottom 40%) living in the United States of America who have virtually no hope at all of achieving the American dream in order for you to get the upgraded leather seats on your Benz.
Do you think you are patriotic? Do you think the founding fathers would be proud of you?
Well, two years ago the S&P was at 750 (and still not done going down, you can disqualify me if you want but what better indicator of the total loss of faith in our economy by the "smart money").
People were lining up at banks to take out their money because they thought the entire economy was going to collapse and whole Wall Street firms were going bankrupt overnight with thousands of people losing their jobs on a daily basis (close to 1M jobs lost in a single month at the peak).
During this crisis, we still couldn’t get the Republicans to pass legislation that was proposed by their own leadership because they thought that was a good time to throw a temper tantrum and hold government hostage so, yes, I do thing we are so much better off than we were two years ago that I can’t even imagine the workings of a mind that wants to go back to the insanity of Republican "leadership."
Should We Take Profits at 300 Percent? [View article]
Ah, now I remember why I don't post free trades - what a hassle! As the guy in the Monty Python sketch says: "I didn't come here for abuse, I came here for an argument."
Rather than get into a whole discussion of margins etc I will say that our portfolios are 75% cash and our short-term trading portfolios (which this trade is obviously part of) are no more than 25% of our entire stock holdings. These are, for the most part fun trades to make and not the bedrock of anyone's portfolio because, as I did say (I thought clearly above), they could go the other way just as easily.
I did mention margin under the SSO trade as it has 1/2 the margin requirement of the DIA play but, rather than play games with digilante, who clearly knows better than me, I would ask a fellow TOS user or anyone who can plug in a trade and check margins what the net margin is for selling 100 DIA May $107 puts. TOS clearly spells it out in the order preview screen and I'm sure IB and others do too. Of course, for those with Portfolio Margin accounts, this hardly merits consideration.
No I don't sleep - far too many fun things to do in the world! Yes my ego is huge, especially in a week when I have well over 100 thank you's for trades that went well. I will try to keep it door-sized. It seems to me that if I want people to take these trades seriously next time I say I have an idea that can make 566% in 6 weeks - then it's good to go over how the last idea for 566% in 6 weeks went so next time they are better prepared to possibly take advantage.
As to people who want to know if this is real. Ask Seeking Alpha if they faked my April 13th and 14th posts after the fact, I guess. The trades are right there in the middle with 3 or 4 paragraphs devoted to each one (and a chart, I think) so it's a we report, you decide kind of thing...
As to FSLR - aren't they at $133 now? Was wrong about them at $150? Obviously, they are not all winners - we do the best we can but read my last month's worth of daily posts and check every trade I recommended rather than find one that didn't work over some period of time (I'm pretty sure FSLR hasn't been $180 for at least a year).
Our main goal is to teach people that you CAN make good returns without taking crazy risks. These plays followed a simple premise that the Dow and S&P would hold up and, now that they've overperformed - it's time to lighten up because the risk/reward profile has shifted. Since I published these trades for non-members here at SA, I thought it would be a good idea to follow up on SA with the same caution I was giving Members.
And yes, PSW is a business that employs me and many other writers, editors, programmers etc and does not, by the way, accept advertising so we are supported by Members, many of whom pay more commission on a single trade than our monthly fees.
Frankly, it's a totally fun way to make a living!
Have a great weekend,
- Phil
PS - There is very legitimate concern for what to do if there is a 9/11 event and the market gaps down, say 1,000 points on the Dow. First of all, we were generally bearish so these plays were covers in case the market went up - if it went down we would have been thrilled.
2nd of all - we have what we call disaster hedges like TZA Oct $6/10 bull call spread at .50, either naked with a $3.50 upside (700%) and no margin or offset by the sale of the Oct $4 puts for .30, which drops this trade to net .20 (upside 1,900%) and a margin requirement (according to TOS so call them, not me) on non PM accounts of $91 per contract to make $380 in the event of a disaster. So setting aside $1,000 in cash on this trade (50 contracts) and $4,550 in margin has an upside return of $20K on this spread in the event of a major catastrophe - these kind of spreads are always good to have and it is a major disservice to other readers to scare them away from sensible hedging by exaggerating the downside. JMHO
3rd of all - if the Dow dropped 1,000 points in one day (something that has never actually happened and 9/11 is not a good example because it quickly reversed) that would be 10 points on DIA and we can assume that the $107 puts would be worth what the $117 puts are now ($5.50) and the escape from there would be to roll the short puts down to the Sept $94 puts at about ($2.50) and then sell the Sept $105 calls for about the same so we've effectively split the short put into a short straddle with about 700 Dow points of leeway on both sides. IF something that never happened before were to happen.
Darn! See, now I've gone and done one of those rambling, multi-screen, scroll down comments that's leaving everyone bleary-eyed. Sorry about that! 8-)
Thrill Ride Thursday: Data Hurts So Good [View article]
Filling is not digging. Blaming Obama for spending $5Tn to stop the US from heading into a Depression is like blaming a trauma surgeon for putting 5 pints of blood into a shooting victim - he didn't make the hole but, if someone doesn't fill it back up, the patient will clearly die.
As Barry Ritholtz says: I am not a Democrat because I have no idea what their economic policies really are but I'm not a Republican because I know EXACTLY what their economic policies really are.
Which Way Wednesday: Beige Book Boogie [View article]
At this point, people who don't believe we are contributing to (maybe even causing) Global warming are no better than flat-Earthers at the time of Columbus. Of course, the problem is the flat-Earthers merely stayed home and perhaps held back exploration of half the planet based on fear and ignorance while the ignorance of the climate deniers may cause the annihilation of our species.
If there were even a 0.01% chance that we were causing climate change that will wipe out life on this planet - how can there possibly be any logic to taking a risk? Does creating greenhouse gasses make our life somehow better? No, just better for corporate profits and, only then because we have made little effort to create alternative, cleaner, renewable energy.
Someone will make a lot of money running solar and, eventually, fusion plants - it just won't be the same people who spend billions brain-washing the knuckle-draggers into defending their status quo.
We enforce seat-belt laws and speed limits on the basis of possible harm - why do we not enforce pollution laws with the same zeal? It's completely illogical but the fact that some people feel the need to stop others from trying to make the World a better place for everyone is just sad.
Well Digg, I didn't want to be condescending. As a Marxian scholar, I'm sure you are familiar with Marx's overview of the class struggle:
"The bourgeoisie, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It ... has left remaining no other nexus between man and man than naked self-interest, than callous “payment in cash” ... for exploitation, veiled by religious and political illusions, it has substituted naked, shameless, direct, brutal exploitation ..."
So I gather that your clever use of the word "believe" was your ivory-tower nod to the religious ferver that Capitalism has aquired in the US and you want to know if I am one of the faithful or if I am calling for a Communist Jihad, which you cleverly quote as a "Marxist Revolution" knowing how droll that would sound as we all know that philosophies don't stage revolutions and, of course that Marx himself died 34 years before the Russian Revolution and had NOTHING at all to do with it other than predicting inevitable social upheaval in his writings in Germany.
I must say, taking that into account, yours is one of the deeper comments I've read here at SA!
The dichotomy of the paradox you present in your second comment is also brilliant - Our political system is the best because it allows improvement without revolution (your supposition being that other systems forbid it?) and all will be well as long as we don't try to "improve" the Constitution which, ironically, was written with the specific intent of being changed and even the guys who wrote it proposed 12 ammendments within 2 years and passed 10 of them 18 months later.
I am pretty sure though, the 11th ammendment was supposed to be "And no more ammendments after this - we mean it this time!" but then they ran out of time and no one remembered to bring it up at the next meeting... 8-)
I'm interested in your opinion on the 10 points of Communism and how they are reconciled with our non-strayed constitution.
Article 2 is that there should be a progressive tax. We have that. Article 4 is that we confiscate the property of rebels. We do that. Article 5 is centralization of credit in the hands of the state through creation of a national bank (Fed). We do that. Article 6 is centralization of communication and transportation in the hands of the state (FCC, DOT). We have that. Article 7 is state control of soil management. We do that. Article 9 is combining manufacturing with agriculture to free the farmers to seek other employment, abolishing the distinctions between town and country. We've done that and we have suburbs. Article 10 is free education in public schools and the abolition of child labor. We do that and, outside the Disney Channel, we hardly have any child labor.
So other than 1, 3 and 8, you are living in a Communist Worker's Paradise.
Article 1 is the abolition of property ownership. That's in progress as we speak for many of our fellow citizens. Article 3 is the abolition of all right of inheritance. Well we know how people feel about the "death tax." Article 8 is equal liablity of all to labor. In other words, everyone does their share. That's a tough call but most of us still work.
So what an evil, radical bastard that Marx was, right?
Monday Market Momentum - Prices Go Parabolic [View article]
Alex - You will be missed! Just like the way you missed my comment above that NFLX is NOT a stock we're shorting now.
Also, I don't consider discussing my market concerns to be "grudges." Again, as you only selectively read I guess I'd better tell you that we went bullish (very hedged) two weeks ago after our levels got broken but that does not mean we have to like it!
I suppose people like their writers to be 100% certain all the time but I'm not and, when I'm not, I put out my thoughts for Members. Our Morning posts are the springboard for a day's worth of discussion in Member Chat, with 211 comments so far today. This is how we form better investing premises - by having open discussions about our ideas and concerns but if you need certainty in uncertain markets - there are tons of other people who will tell you what is definitely going to happen - on both sides of the trades.
Good point by Swingman, I think a VAT is the only solution there. Anything else the Corporations can weasel out of. Very simply, if you sell an item or service in the USA, 10% of it goes to the Governement. That's $1.5Tn collected from corporations vs. $200Bn now - Almost enough to balance the deficit as is. I know they say "it will just get passed down to the consumer" and so what? What happens to taxes now? Same thing. The only difference is you can't hide from the VAT and GE would have to price their products to allow for a $15.6Bn check to Uncle Sam as would TM, who sold $200Bn worth of cars and paid $1Bn in tax.
It won't happen because it's A) Fair B) Difficult to Evade and C) Taxes the rich because a $48M Yacht would have a $4.8M tax bill in the price somewhere while the maid who scrubs the toilet on that Yacht would spend $2 on the $20 toy boat she gets her kid for Christmas. Let "free market" competition handle the rest - the consumers will still buy whatever they net can afford but we'll cut our deficit by 75% instantly.
Seeking Truth is right, this is about covering our bases. We discussed that on Friday and in the Wrap-Up show.
Thanks for the article Quinn - great read! You are actually the reason I stopped by this evening. Thanks!
500whatever - You seem to miss the concept that we are short-term short and have made fantastic money on all the stocks you mention when they pulled back, except for CRM, which I dont' think we have ever played as a general trade. Also, you miss the whole concept of balancing long plays and short plays but that's OK, we need one-sided traders like you to sell us puts and buy our short calls!
Thanks Retirefund! I hope it's not prohetic - that would really suck for America.
S&P/GMak - Did you see this one?
The S&P’s rise to a Shiller P/E above 24 tells John Hussman that "valuations are richer today than at any point in history," except for just prior to the 1929 crash. Further upside is limited, he says; "with no transformative technologies driving the economy, little expansion in capital investment, and ongoing retrenchment in consumer balance sheets," there’s little life left in this bull.
Toppy Tuesday: Can We Break On Through To The Other Side? [View article]
That's why the whole scam should be shut down - people who have no actual interest in accepting or delivering commodities should not be allowed to set prices for consumers, should they?
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
A completely false premise to base your "point" on.
Let's say we're talking beans instead of money and that we, as a society, have determined that people need 20 beans to live and the bottom 50% make less than 20 beans. How much should we tax them? Tax them 1 bean and they die - how many do you need to kill to feel good about the tax code?
In fact, 1/2 of the bottom 50% make zero (just SS income). Just because they file returns doesn't mean they earn money - this is a major source of false padding by the right.
So, let's say, for argument's sake, that the bottom 20% have just 10 beans - either we give them 10 beans or they simply die.
Now, let's talk about the top 25% who have 40 beans. How many do they need to live? How many can they afford to contribute?
The top 10% have 100 beans - they too NEED 20 but they have 100. The top 5% have 200 and the top 1% have 400 - all of them only need 20 - and don't say they need more because then why don't you care that the bottom 50% only have 20?
So who should be giving up their beans? The bottom 50% have none to give while the top 1% have 380 more than they need - enough to supplement 38 people in the bottom 20% each.
This is what a tax code does, it redistributes the collective wealth of society according to the actual needs of the people in that society.
Suppose Bill Gates bought up all the water rights in the entire US and bought up all the farms in the US and cornered the market on Food and water. Then he could - in a very legal and capitalist way - control the supply such that prices ended up being 100% of everyone else's income. That would give Bill Gates 100% and everyone else zero at the end of the year. Would you still see no need to redistribute his income?
Somewhere in between none and all is the answer - we have simply moved a little too close to none for a healthy economy.
Friday's Market Blow - Jobs or No Jobs? [View article]
So I stopped by to add my morning commentary to Members as we discussed the morning post - thought it might fill in some blanks:
Sorry, wasn’t trying to be depressing – just wanted to give an overview of how the markets can look good but not actually BE good. It’s important to get the perspective of the WHOLE economy – not just the part that we swim around in as most of us, me included, are not really with ordinary people on a daily basis.
Just this morning, in fact, I said to Tina (who drinks about 4 cups a day) whether she had noticed coffee prices doubling in the stores and she said "I don’t know, you always buy it" and, of course, I never look at prices so I don’t know either. That may be messed up but what do I care if a pound of coffee is $4 or $8 or $12 – we buy one every couple of weeks. On the other hand, when I think about it – the difference between $4 and $12 is a whole hour of take-home pay for most people, so 1/80th of their total salary gobbled up by an increase of $8 in the price of coffee.
How do we think this is sustainable? A tank of gas every two weeks is another $16 ABOVE what they usually spend – there’s 2/80 more hour’s wages down the tubes. What’s wrong with OUR bullish investing premise as these prices mount up is that EVERYONE thinks they are going to pass through price increases while NO ONE thinks they will be absorbing wage increases. EVEN if the Fed is printing money like mad – they aren’t giving it to the people who ultimately need to pay those prices – they are giving it to us and we are pumping it into speculative commodities and misinterpreting the rise in commodities and equities for economic health and thus we put even more money into "what’s working" all without stopping to think where all this PROJECTED growth money is going to come from.
That’s the bearish premise – the assumption that there is a finite amount of money available for the ultimate purchase of goods and services and those goods and services that need to be sold in bulk – like cotton, copper, corn, wheat and oil – will ultimately collapse under their own weight because we are certainly not increasing the workforce by 15% to pay for the 15% rise in costs and we aren’t raising wages by 15% to pay for the 15% rise in costs so (going back to the post) – MATHEMATICALLY – it is not possible for these speculative prices to be sustained. They are an illusion based on a fantasy that is being pushed on you by the top 0.01% to get you to dig into your 65% cash position and take all those worthless contracts off their hands before it all hits the fan – AGAIN!
Thrill Ride Thursday: Data Hurts So Good [View article]
You (Conservatives - although what a joke that label is) took the money FROM the people who WORKED for it and you spent it on your ridiculous wars and, of course, to relieve the rich of their own ordinary obligations to be taxed like everyone else.
You're not GIVING people anything in SS and Medicare other than their own money back with the interest that's due to them - none of which is there BECAUSE YOU STOLE IT!
When the victim of a robbery asks that the thief gives the money back - that is not then charity on the part of the thief (sorry - "job creator").
The money was all there - Al Gore wanted to put it in a "lock box" and we were on track to pay off our entire $3.6Tn deficit in 12 years under the last Clinton Budget but then GW says - "hey, that surplus is our money (meaning rich people's, apparently) and we need to give it back to the American people (meaning the rich ones).
So he spent the surplus that was supposed to pay off the debt and then he spent another $8Tn he didn't have on more tax breaks and more wars, leaving a $11Tn hole for Obama - as well as a crisis of biblical proportions (and Government spending that had doubled under Bush and has gone down since Obama took office but too late to stop the deficit train from adding $5Tn more debt).
So it's not the "leftist" mentality you should be wondering about but the "rightist" BS you seem to swallow whole and regurgitate as if it had some basis in reality and not, as you say, from the twilight zone.
Tumultuous Tuesday: Mickey Mouse Misses Mortgage Payments? [View article]
I did not attack Disney, I quoted an article on Disney but yes, when you work people to death in poor conditions in a labor market that offers them no escape and leads to feelings of hopeless entrapment - suicides do happen.
We spoke last week about the suicides at the AAPL plant (so forgive me for not footnoting my citations EVERY time I mention something) and again - What is the difference between your IPhones being made by people who make $150 a month and sleep 10 to a dorm room with no retirement or health care and actual slaves? What? The fact that they can quit that job and starve to death somewhere else?
Grow up people, our whole lifestyle is currently built on slave labor. We couldn't exploit the workers over here so we "outsourced" the exploitation overseas.
Am I a Maxist? Well, when did Marxist become a bad thing? Marx was a philospher and communism is a legitimate form of economic organization that is the polar opposite of capitalism and Marx was a philosopher (I know, what's that) that studied both. I quoted Aristotle above - does that make me an Aristotlist?
Marx pointed out that the inevitable strains placed upon the working class by the capitalist wheels of production would end in revolution and, it turns out, he was right. Over 160 years later we are busy recreating all the evils of early Industrial Capitalism that Marx observed at the time (1848) but I'll be there's not 5 people reading this comment who've actually read the Communist Manifesto.
In the very least, try reading the Wikipedia entry before the next time you feel the urge to cry "Marxist" at anyone who suggests Capitalism may have some flaws: en.wikipedia.org/wiki/...
Fickle Friday: Jobs Report [View article]
You are right though, giving anything away is a complete waste of time because there are always people like you looking to spit at every warm gesture made by others.
Did I hide my motives? Was it a trick? Am I even asking people to become high-paying Members or am I discussing my $49/month Newsletter service?
I see this is your first comment and you have no bio - I don't know why Seeking Alpha allows it's authors to be attacked by anonymous nobodies like this either. Are you a rival service - what's your record look like? What picks have you given people this week on your blog?
Every single thing I discuss above can be found by reading my last 4 articles this week. Don't worry though, I don't usually give out that many free trades, this was just one of those weeks where I got some free advertising in exchange for 5 days of posts you obviously didn't bother reading before criticizing.
Friday's Market Blow - Jobs or No Jobs? [View article]
Do you know what you are saying is grossly mis-leading or do you only read Conservative studies that distort the facts that lead to your grossly mis-aligned views?
Your lack of citations when quoting statistics is telling as this was a "study" by the Commonwealth Foundation who's MISSION STATEMENT is "Promoting the use of economic reasoning to understand a world of scarcity, trade-offs, and the unseen consequences of governmental solutions to societal problems."
www.commonwealthfounda...
The reason Iowa ranks highest in SAT scores is only 3% of the students in Iowa take the SAT. Why is that? Because 97% of the students in Iowa have little or no hope of attending college due to the low per capital education spending!
Only the most exceptional students in Iowa end up taking the SATs in the first place and what a waste of talented minds that these poor children live in a state where education was one of the lowest priorities of any state in the country.
In Minnesota, it's 7% of the students and both Wisconsin and Missouri score 4%. Michigan came in with just 5% and South Dakota 3% - all low spenders on education.
Pennsylvania (where the Commonwealth Foundation was trying to prove that spending on education is a waste) spent $20,000 per student on education (and, of course the cost of living is miles different in PA so apples to oranges) but 71% of their students took the SATs - indicating a tremendously high degree of expectations of post-graduate studies.
Rather than "proving" money spent on education is a waste - this study proves the incredible effect of doubling spending as it has a 20x multiplier effect on the number of students who are prepared to move on to college after high school.
YOU sir, are the reason this country is going down the drain. YOU are the reason America becomes uncompetitive and YOU are contributing to the squandering of America's greatest natural resource - our own people and what they can accomplish if we just gave them a chance....
Now, let's look at a real study - one done by the College Board that administers the SATs:
professionals.collegeb...
Notice in table 11 that FAMILY INCOME is an ABSOLUTE predictor of scores with a 25% average difference between the top 10% (family incomes over $200,000) and the bottom 20% (family incomes under $20,000). The $20-40K group scarcely did better and even families with $40-60K income and we are now talking about 60% of the American people, scored an average of 15% lower than those in the privileged families.
Parental education was an even more extreme indicator with the children of Graduates scoring 1,690 on average vs 1,287 (24% less) for High-School drop-outs and 1,461 (13.5% less) for High School Graduates.
So next time you spit down in disgust as you step over a homeless person Howard, perhaps use your pampered mind to consider for just a moment how you yourself are working to condemn that person, people like them and their families to an endless and virtually unbreakable cycle of poverty and despair - an entire group of 120M people (the bottom 40%) living in the United States of America who have virtually no hope at all of achieving the American dream in order for you to get the upgraded leather seats on your Benz.
Do you think you are patriotic? Do you think the founding fathers would be proud of you?
Will We Hold It Wednesday: Euro $1.25 Edition [View article]
Food Stamp Friday: True Colors [View article]
Well, two years ago the S&P was at 750 (and still not done going down, you can disqualify me if you want but what better indicator of the total loss of faith in our economy by the "smart money").
People were lining up at banks to take out their money because they thought the entire economy was going to collapse and whole Wall Street firms were going bankrupt overnight with thousands of people losing their jobs on a daily basis (close to 1M jobs lost in a single month at the peak).
During this crisis, we still couldn’t get the Republicans to pass legislation that was proposed by their own leadership because they thought that was a good time to throw a temper tantrum and hold government hostage so, yes, I do thing we are so much better off than we were two years ago that I can’t even imagine the workings of a mind that wants to go back to the insanity of Republican "leadership."
Should We Take Profits at 300 Percent? [View article]
www.youtube.com/watch?...
Rather than get into a whole discussion of margins etc I will say that our portfolios are 75% cash and our short-term trading portfolios (which this trade is obviously part of) are no more than 25% of our entire stock holdings. These are, for the most part fun trades to make and not the bedrock of anyone's portfolio because, as I did say (I thought clearly above), they could go the other way just as easily.
I did mention margin under the SSO trade as it has 1/2 the margin requirement of the DIA play but, rather than play games with digilante, who clearly knows better than me, I would ask a fellow TOS user or anyone who can plug in a trade and check margins what the net margin is for selling 100 DIA May $107 puts. TOS clearly spells it out in the order preview screen and I'm sure IB and others do too. Of course, for those with Portfolio Margin accounts, this hardly merits consideration.
No I don't sleep - far too many fun things to do in the world!
Yes my ego is huge, especially in a week when I have well over 100 thank you's for trades that went well. I will try to keep it door-sized. It seems to me that if I want people to take these trades seriously next time I say I have an idea that can make 566% in 6 weeks - then it's good to go over how the last idea for 566% in 6 weeks went so next time they are better prepared to possibly take advantage.
As to people who want to know if this is real. Ask Seeking Alpha if they faked my April 13th and 14th posts after the fact, I guess. The trades are right there in the middle with 3 or 4 paragraphs devoted to each one (and a chart, I think) so it's a we report, you decide kind of thing...
As to FSLR - aren't they at $133 now? Was wrong about them at $150? Obviously, they are not all winners - we do the best we can but read my last month's worth of daily posts and check every trade I recommended rather than find one that didn't work over some period of time (I'm pretty sure FSLR hasn't been $180 for at least a year).
Our main goal is to teach people that you CAN make good returns without taking crazy risks. These plays followed a simple premise that the Dow and S&P would hold up and, now that they've overperformed - it's time to lighten up because the risk/reward profile has shifted. Since I published these trades for non-members here at SA, I thought it would be a good idea to follow up on SA with the same caution I was giving Members.
And yes, PSW is a business that employs me and many other writers, editors, programmers etc and does not, by the way, accept advertising so we are supported by Members, many of whom pay more commission on a single trade than our monthly fees.
Frankly, it's a totally fun way to make a living!
Have a great weekend,
- Phil
PS - There is very legitimate concern for what to do if there is a 9/11 event and the market gaps down, say 1,000 points on the Dow. First of all, we were generally bearish so these plays were covers in case the market went up - if it went down we would have been thrilled.
2nd of all - we have what we call disaster hedges like TZA Oct $6/10 bull call spread at .50, either naked with a $3.50 upside (700%) and no margin or offset by the sale of the Oct $4 puts for .30, which drops this trade to net .20 (upside 1,900%) and a margin requirement (according to TOS so call them, not me) on non PM accounts of $91 per contract to make $380 in the event of a disaster. So setting aside $1,000 in cash on this trade (50 contracts) and $4,550 in margin has an upside return of $20K on this spread in the event of a major catastrophe - these kind of spreads are always good to have and it is a major disservice to other readers to scare them away from sensible hedging by exaggerating the downside. JMHO
3rd of all - if the Dow dropped 1,000 points in one day (something that has never actually happened and 9/11 is not a good example because it quickly reversed) that would be 10 points on DIA and we can assume that the $107 puts would be worth what the $117 puts are now ($5.50) and the escape from there would be to roll the short puts down to the Sept $94 puts at about ($2.50) and then sell the Sept $105 calls for about the same so we've effectively split the short put into a short straddle with about 700 Dow points of leeway on both sides. IF something that never happened before were to happen.
Darn! See, now I've gone and done one of those rambling, multi-screen, scroll down comments that's leaving everyone bleary-eyed. Sorry about that! 8-)
Thrill Ride Thursday: Data Hurts So Good [View article]
As Barry Ritholtz says: I am not a Democrat because I have no idea what their economic policies really are but I'm not a Republican because I know EXACTLY what their economic policies really are.
Which Way Wednesday: Beige Book Boogie [View article]
If there were even a 0.01% chance that we were causing climate change that will wipe out life on this planet - how can there possibly be any logic to taking a risk? Does creating greenhouse gasses make our life somehow better? No, just better for corporate profits and, only then because we have made little effort to create alternative, cleaner, renewable energy.
Someone will make a lot of money running solar and, eventually, fusion plants - it just won't be the same people who spend billions brain-washing the knuckle-draggers into defending their status quo.
We enforce seat-belt laws and speed limits on the basis of possible harm - why do we not enforce pollution laws with the same zeal? It's completely illogical but the fact that some people feel the need to stop others from trying to make the World a better place for everyone is just sad.
Tumultuous Tuesday: Mickey Mouse Misses Mortgage Payments? [View article]
"The bourgeoisie, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It ... has left remaining no other nexus between man and man than naked self-interest, than callous “payment in cash” ... for exploitation, veiled by religious and political illusions, it has substituted naked, shameless, direct, brutal exploitation ..."
So I gather that your clever use of the word "believe" was your ivory-tower nod to the religious ferver that Capitalism has aquired in the US and you want to know if I am one of the faithful or if I am calling for a Communist Jihad, which you cleverly quote as a "Marxist Revolution" knowing how droll that would sound as we all know that philosophies don't stage revolutions and, of course that Marx himself died 34 years before the Russian Revolution and had NOTHING at all to do with it other than predicting inevitable social upheaval in his writings in Germany.
I must say, taking that into account, yours is one of the deeper comments I've read here at SA!
The dichotomy of the paradox you present in your second comment is also brilliant - Our political system is the best because it allows improvement without revolution (your supposition being that other systems forbid it?) and all will be well as long as we don't try to "improve" the Constitution which, ironically, was written with the specific intent of being changed and even the guys who wrote it proposed 12 ammendments within 2 years and passed 10 of them 18 months later.
I am pretty sure though, the 11th ammendment was supposed to be "And no more ammendments after this - we mean it this time!" but then they ran out of time and no one remembered to bring it up at the next meeting... 8-)
I'm interested in your opinion on the 10 points of Communism and how they are reconciled with our non-strayed constitution.
Article 2 is that there should be a progressive tax. We have that.
Article 4 is that we confiscate the property of rebels. We do that.
Article 5 is centralization of credit in the hands of the state through creation of a national bank (Fed). We do that.
Article 6 is centralization of communication and transportation in the hands of the state (FCC, DOT). We have that.
Article 7 is state control of soil management. We do that.
Article 9 is combining manufacturing with agriculture to free the farmers to seek other employment, abolishing the distinctions between town and country. We've done that and we have suburbs.
Article 10 is free education in public schools and the abolition of child labor. We do that and, outside the Disney Channel, we hardly have any child labor.
So other than 1, 3 and 8, you are living in a Communist Worker's Paradise.
Article 1 is the abolition of property ownership. That's in progress as we speak for many of our fellow citizens.
Article 3 is the abolition of all right of inheritance. Well we know how people feel about the "death tax."
Article 8 is equal liablity of all to labor. In other words, everyone does their share. That's a tough call but most of us still work.
So what an evil, radical bastard that Marx was, right?
Monday Market Momentum - Prices Go Parabolic [View article]
Also, I don't consider discussing my market concerns to be "grudges." Again, as you only selectively read I guess I'd better tell you that we went bullish (very hedged) two weeks ago after our levels got broken but that does not mean we have to like it!
I suppose people like their writers to be 100% certain all the time but I'm not and, when I'm not, I put out my thoughts for Members. Our Morning posts are the springboard for a day's worth of discussion in Member Chat, with 211 comments so far today. This is how we form better investing premises - by having open discussions about our ideas and concerns but if you need certainty in uncertain markets - there are tons of other people who will tell you what is definitely going to happen - on both sides of the trades.
Good point by Swingman, I think a VAT is the only solution there. Anything else the Corporations can weasel out of. Very simply, if you sell an item or service in the USA, 10% of it goes to the Governement. That's $1.5Tn collected from corporations vs. $200Bn now - Almost enough to balance the deficit as is. I know they say "it will just get passed down to the consumer" and so what? What happens to taxes now? Same thing. The only difference is you can't hide from the VAT and GE would have to price their products to allow for a $15.6Bn check to Uncle Sam as would TM, who sold $200Bn worth of cars and paid $1Bn in tax.
finance.yahoo.com/q/is...
It won't happen because it's A) Fair B) Difficult to Evade and C) Taxes the rich because a $48M Yacht would have a $4.8M tax bill in the price somewhere while the maid who scrubs the toilet on that Yacht would spend $2 on the $20 toy boat she gets her kid for Christmas. Let "free market" competition handle the rest - the consumers will still buy whatever they net can afford but we'll cut our deficit by 75% instantly.
Seeking Truth is right, this is about covering our bases. We discussed that on Friday and in the Wrap-Up show.
Thanks for the article Quinn - great read! You are actually the reason I stopped by this evening. Thanks!
500whatever - You seem to miss the concept that we are short-term short and have made fantastic money on all the stocks you mention when they pulled back, except for CRM, which I dont' think we have ever played as a general trade. Also, you miss the whole concept of balancing long plays and short plays but that's OK, we need one-sided traders like you to sell us puts and buy our short calls!
Thanks Retirefund! I hope it's not prohetic - that would really suck for America.
S&P/GMak - Did you see this one?
The S&P’s rise to a Shiller P/E above 24 tells John Hussman that "valuations are richer today than at any point in history," except for just prior to the 1929 crash. Further upside is limited, he says; "with no transformative technologies driving the economy, little expansion in capital investment, and ongoing retrenchment in consumer balance sheets," there’s little life left in this bull.
hussmanfunds.com/wmc/w...
Toppy Tuesday: Can We Break On Through To The Other Side? [View article]
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Let's say we're talking beans instead of money and that we, as a society, have determined that people need 20 beans to live and the bottom 50% make less than 20 beans. How much should we tax them? Tax them 1 bean and they die - how many do you need to kill to feel good about the tax code?
In fact, 1/2 of the bottom 50% make zero (just SS income). Just because they file returns doesn't mean they earn money - this is a major source of false padding by the right.
So, let's say, for argument's sake, that the bottom 20% have just 10 beans - either we give them 10 beans or they simply die.
Now, let's talk about the top 25% who have 40 beans. How many do they need to live? How many can they afford to contribute?
The top 10% have 100 beans - they too NEED 20 but they have 100. The top 5% have 200 and the top 1% have 400 - all of them only need 20 - and don't say they need more because then why don't you care that the bottom 50% only have 20?
So who should be giving up their beans? The bottom 50% have none to give while the top 1% have 380 more than they need - enough to supplement 38 people in the bottom 20% each.
This is what a tax code does, it redistributes the collective wealth of society according to the actual needs of the people in that society.
Suppose Bill Gates bought up all the water rights in the entire US and bought up all the farms in the US and cornered the market on Food and water. Then he could - in a very legal and capitalist way - control the supply such that prices ended up being 100% of everyone else's income. That would give Bill Gates 100% and everyone else zero at the end of the year. Would you still see no need to redistribute his income?
Somewhere in between none and all is the answer - we have simply moved a little too close to none for a healthy economy.
Thrill-Ride Thursday - Will Dudley Do Right Save the Day? [View article]
Friday's Market Blow - Jobs or No Jobs? [View article]
Sorry, wasn’t trying to be depressing – just wanted to give an overview of how the markets can look good but not actually BE good. It’s important to get the perspective of the WHOLE economy – not just the part that we swim around in as most of us, me included, are not really with ordinary people on a daily basis.
Just this morning, in fact, I said to Tina (who drinks about 4 cups a day) whether she had noticed coffee prices doubling in the stores and she said "I don’t know, you always buy it" and, of course, I never look at prices so I don’t know either. That may be messed up but what do I care if a pound of coffee is $4 or $8 or $12 – we buy one every couple of weeks. On the other hand, when I think about it – the difference between $4 and $12 is a whole hour of take-home pay for most people, so 1/80th of their total salary gobbled up by an increase of $8 in the price of coffee.
How do we think this is sustainable? A tank of gas every two weeks is another $16 ABOVE what they usually spend – there’s 2/80 more hour’s wages down the tubes. What’s wrong with OUR bullish investing premise as these prices mount up is that EVERYONE thinks they are going to pass through price increases while NO ONE thinks they will be absorbing wage increases. EVEN if the Fed is printing money like mad – they aren’t giving it to the people who ultimately need to pay those prices – they are giving it to us and we are pumping it into speculative commodities and misinterpreting the rise in commodities and equities for economic health and thus we put even more money into "what’s working" all without stopping to think where all this PROJECTED growth money is going to come from.
That’s the bearish premise – the assumption that there is a finite amount of money available for the ultimate purchase of goods and services and those goods and services that need to be sold in bulk – like cotton, copper, corn, wheat and oil – will ultimately collapse under their own weight because we are certainly not increasing the workforce by 15% to pay for the 15% rise in costs and we aren’t raising wages by 15% to pay for the 15% rise in costs so (going back to the post) – MATHEMATICALLY – it is not possible for these speculative prices to be sustained. They are an illusion based on a fantasy that is being pushed on you by the top 0.01% to get you to dig into your 65% cash position and take all those worthless contracts off their hands before it all hits the fan – AGAIN!
There – I’m done with the depressing stuff now.