Philip Davis

Options Trader: Friday Outlook

Al, Hedge fund is launching in the fall, will be fully audited so no problem there.

Options Trader: Tuesday Outlook

I don't know of a proper Dow study. The S&P routinely changes components too and the Russell just rebalanced but with the Dow just having 30 components, you really can't just go pretending it doesn't matter when you trade 2 in, especially with their whacked out weighting system - that in itself could have used an extensive study to figure out what the hell they did.


SC Boeing: www.bloomberg.com/apps...

I would understand the lack of action by the government if the situation was insoluble, but it isn't. It just takes firm action and some vision. Unfortunately, those are things we are very short of in our government.

Options Trader: Wednesday Outlook

Actually we haven't been short on oil since we made a fortune in the fall when it double topped at $100 and we bet the farm both times. We started shorting again at $110 with a plan to roll up and double down on our puts for 3 months but we already had a great expiration in March when oil plunged from $110 to $98 so this (April) looks to be a losing month for us if you don't count SU, who just made us a mint, or OIH, who just made us a mint or BTU, who just made us a mint but XOM, CVX, USO and XLE haven't paid off for us yet but please sell us puts at these prices if you are bullish.

Just this Monday, right here in SA, I said buy PTR (up 13%), FTO (down 5%) and COP (even) as hedges against our puts on SU (down 4%), USO (up .5%) and XOM (flat) so I can only assume you don't actually read the posts, just spout off against anyone who challenges your world-view.

Of course at $120 we went all short and you can tell me how smart you are in June if oil holds up here but I say it's unsustainable and that's where we're placing our bets but we need people like you or we couldn't possibly find people willing to bet oil goes higher from here so thanks for being there for us!

Bluedog - I won't get into WHY a guy who's taken over $250M in contributions from oil companies won't release the SPR and knock of $7.3Bn in annual revenues for each dollar a barrel oil goes down (think about how cheap that ratio makes it for oil companies to buy politicians, pay off Nigerian warlords etc) because Yape will call me a dope or Michael Moore and hurt my feelings...

Exxon Shares Sinking to Levels They Richly Deserve

At this point, 18 years later, I won't pretend to be able to go back and recreate the circumstances but the fact is that juries award 2 types of damages, often because there are statutory limits but the combination of the compensatory and puntative damages are the award. The total in dispute amounts to less than $113K per fishing family who was forced to relocate and find a new occupation as the ecosystem was damamged beyond repair.

Of course the lawyers get 1/3 of that so effectively the affected familes were hoping, back in 1990 to get $70,000 to be able to put their lives back together and that's what the jury thought was fair.

Exxon though, found it more expedient to spend $20M a year (and force the defendants to spend the same) on appeal after appeal while they contributed to politicians and judges until they could find a "more favorable venue" for their case. Of course, even if they didn't win, the interest on the money they weren't paying more than covered the costs. In fact, after 15 years, with interest and inflation - they are paying virtually zero out of pocket on the amount they put aside.

As an added bonus, those claimants who die while they wait (13% in 15 years) are not entitled to payment!

So the opportunity afforded to a corporation who has harmed an individual is great indeed in this country. There is no reason - in fact it is irresponsible to the shareholders - to pay a large judgment as the waiting game has great returns. A large corporation can spend millions on legal fees until even large law firms are forced to give up the fight, leaving the plaintiffs high and dry or foced to settle for pennies on the dollar.

Exxon Shares Sinking to Levels They Richly Deserve

How about a risk tolerance profile that shows, overall, Exxon doesn't take any "ie. they don't look so there's no risk!" www.searchanddiscovery...

You're right about a Billion dollars - they lost, then they lost again, then they lost again, then they lost again. Rather than pay they appealed and appealed and appealed while the familie who's lives they destoyed, the tens of thousands of fisherman who lost their livelihood the residents of the 1,500 miles of coastland they blighted all grew old and some even died - taking them off the damage list.

It's one thing if you and I have a dispute and go to court over something but quite another when a $400Bn corporation causes Billions of dollars of damage and then makes a cold, calculating decision that it is cheaper to keep the money and litigate the case for another 20 years while their victims twist in the wind. It is savage and reprehensible, contrary to most people's definition of human decency and - good corrporate policy!

And yes, that's the point of buying back stock, you take the shares out of circulation to create the illusion that you are earning more money per share when, in fact, you are not. This is a strategy very much like borrowing money to get yourself out of debt - at some point your creditors will wise up. Exxon can keep up this scam as long as oil is over $60, but 2 earnings reports under and there won't be a rug big enough to sweep the numbers under.

ExxonMobil: Black Magic

I'm happy about it! My next project is to get on CNBC as the only oil bear they've ever interviewed...

Oil Inventories On the Rise: Where's the Shortage?

Whiner, you are correct (or possibly correct because there are no accurate records) - as I said above, those "supplies" include oil and gas (and, in XOM's case chemicals), I just converted the whole lot into barrels as it's less complicated to wrap our heads around.

Tom, you can be aware of a trap, you can understand the trap, you can know how you got into a trap but that doesn't mean you can get out...

Cross, after this busy weekend I can just sit back and see if the markets bear me out. We've already made our plays so good luck to all on their positions!

Amaranth: Tip of the Iceberg

Ram,

There are crawlers that grab blogs quickly after they are published and the main site (philstocks.blogspot.co.../) posts, usually, before 9:30 am.

Oil Sector Watch: On the Lookout for Puts

We did well shorting SLB this week but we also took calls on it yesterday so, obviously, I hate to give "views" but I think, once they are no longer overbought, they are too strong to pick on as long as oil stays over $55.

Amaranth: Tip of the Iceberg

Click on the word "this" in the article - the pipes aren't designed to carry it - extremely hazardous...

Oil Price Manipulation: Taking from the Poor to Give to the Rich

en.wikipedia.org/wiki/...

Oil Price Manipulation: Taking from the Poor to Give to the Rich

OK, I see we are getting caught up on math which was just an example...

Here's an even easier way to look at it.

When gas was $1.55 per gallon, XOM made a 13% profit - so every gallon you purchased included a .20 profit for XOM - this is an audited fact!

Now gas is $2.50 a gallon (forgetting the past 6 months) and XOM is making an 18% profit. That means you are now giving XOM (or whoever) .45 for each gallon you purchase.

Just like with any utility (most of which are sensibly regulated), your demand is inflexible so they can charge any rate of profit they wish. You can say the money went here or this expense or that expense or tax or terror or speculators or any BS you wish to use but the absolute mathematical fact is that Exxon is making 38% more profits while you are paying 66% more for energy.

They could have maintained their margins or even let them drift up a few points but instead, they found you mugged and beaten on the street and they stopped to bend over and go through you wallet to get your last couple of bucks. Yeah God bless 'em, they're just patriotic Americans trying to scrape by as best they can...