Former Governor of New Mexico (D), former USA Ambassador to UN and former Energy Secretary, Bill Richardson, thinks Wall untenable and Government cannot prevent shutdown of Federal Government on April 29th. We have nearly 50K troops in Asia and need to strong-arm China to defuse situation, interviewed on CNN.
STAGFLATION: Combination of Inflation and Stagnation commensurate to the 1970s.
Greenspan compares current Dow, worst performance since 2006, to October 1987 where the market fell 23%.
Euro will fragment into North and South Euro: Germany (EXPANDING DEFENSE SPENDING BY 1.2% ACCORDING TO GERMAN FINANCE MINISTER, WOLFGANG SCHAUBLE, WILL CONTINUE TO DISCUSS POLICIES WITH MNUCHIN), Austria and Finland constitutes the North, South composed of Spain and Greece.
Purchase Oils – XOM, DVN, CVX, APA, MRO, COP and CHK, also PEIX. More speculatively on LNG, UGAZ. SHORT AIRLINES: UAL, AAL, DAL, LUV, ALK AND SAVE. Commensurate to the 1970s: 73 Love Affair.
HEALTHCARE: Most of the Healthcare stocks have already tanked. I found one that hit a new 52-Week High today, 4/21/17, United Health Care or UNH (A Candle to be extinguished), ripe for the shorting because of the confusion around the ACA. Trump ambivalent about replacing the ACA in the First 100 Days. The Market does NOT LIKE UNCERTAINTY.
- According to CNBC, Oil underperforming COPPER: SPECULATIVE PLAY – WRN. 3X LEVERAGED Silver play: USLV. 3X LEVERAGED BULL FUND ON GOLD: NUGT (NYSE), also 3X Velocity 3X Long Gold, UGLD (NYSE).
- Alternative fuels may SPIKE IN SYMPATHY, REITERATE STRONG BUY: BUY ON THE SHARP KNIFE DOWN, ON 4/21/17: PLUG.
- Also, if a geopolitical event spooks the market in General, take haven in S&P 500 Short Fund: SDS and the NASDAQ: SQQQ. A record number of money managers think the market is overvalued.
Possibility of FLASH CRASH. According to the U.S. government, the British day trader had made tens of millions of dollars using an illegal practice called spoofing, including, fatefully, on the morning of May 6, 2010, when the Dow Jones Industrial Average fell almost 1,000 points in minutes before bouncing back. The extent of Sarao’s culpability for the flash crash is fiercely contested, but the incident exposed the shaky foundations on which the hyper-fast, computer-dominated financial markets now rest.
Median Stock in S&P500 is down 26%, according to CNBC. The Trend is Your Friend: S&P Ultrashort Purchase SDS and NASDAQ Ultrashort Lagging Down, SQQQ.
STAGNATION – SPECULATIVE SHORTS BECAUSE OF Discretionary Income Drop:
- America’s Retailers CLOSING STORES FASTER THAN EVER!!!!! What will happen to the Retail Sector employees laid off????? – SPECULATIVE SHORT: S&P Retail (NYSE: XRT) Fund, BRX and SPG. Foot Locker (NYSE: FL) WARNED March Sales Slower because of a Delay in IRS Refunds (a “Likely Excuse”), HOWEVER, RECEIVED A WALL STREET UPGRADE. Will get creamed by Zappos.com. The Proof is in the Pudding, Subway closes 359 stores in 2016, an ANCHOR STORE for many STRIP MALLS.
- GME, sales down 16.3% Y Over Y; ATVI (Starting to crack, down 0.16% while market down 0.11%: Also 2016 EPS barely above 2015 with nearly 1.5B in greater sales), SNE AND MSFT down (starting to crack in sympathy with IBM, however, MSFT at one point halted XBox Console production lines). EA (A Candle that will be extinguished), TTWO and Console Producers, SNE and MSFT. See DUE DILIGENCE.
- “Fewer jobs in America,” according to Terry Lundgren (Macy’s Executive Chairman), interviewed on CNBC.
- UK Retail Sales Lowest Since 2010, ACCORDING TO CNBC.
- Tourist Industry will GET HIT HARD: EXPE, WYNN, NCLH, CUK, CCL, RCL and DIS, CAR, CBRL, BOBE, CAKE and CMG (discretionary incomes will hurt higher end restaurants as consumers strapped for cash downsize to MCD’s Dollar Menu).
- Rotating Credit Facilities will have to write off AAPL RETINA liabilities as average cost of a RETINA is insurmountably greater than competition: AXP, MA(Showing Weakness: The Trend is Your Friend) and V (V hits new high: RIPE FOR A SHORT POSITION)
- Big Blue IBM AND MSTR (Watson, a B-to-B: Business to Business product is being heavily promoted with commercials on TV and the Web: High $80/seat/month price cannot compete with Microsoft Power BI: freemium pricing model)
- Console Gaming Business Implosion – GME reported comps Y over Y down 16.3% (Down $0.18 or 0.78%), EA (A Candle that will be extinguished), ATVI, TTWO and Console Producers, SNE and MSFT. See Due Diligence.
- Also SPECULATIVE SHORTs: NFLX, NVDA, AAPL, GOOG and FB (Oculus is unaffordable for the average consumer commensurate to Console Gaming Business, foreboding THX-1138 (1971) starring Robert Duvall and Donald Pleasence).
- TSLA recalling 53,000 Models, X and S, because of Brake Problem (63% of Cars Manufactured Last Year). Also, PRE-ORDERS from the 180K may be rescinded. Down $2.71 or 0.89%. The TREND IS YOUR FRIEND.
- REPLACEMENT OF SSDs (Solid State Drives) vs. RAID5 – SPECULATIVE SHORT OF STX AND WDC.
- USA MARKET TRADING AT AVERAGE 18 P/E while OVERSEAS MARKET TRADES BETWEEN 13-15 P/E (NYSE: EEM)
ALTERNATIVES TO THE TRADITIONAL BANKING SECTOR: As unemployment and underemployment skyrockets, consumers will flock to ETSY, EBAY(earn $4K) and PYPL(bucking the downward trend today, 4/21/17, up 0.27% or $0.12).
After the close on 4/26/17, PYPL Reported EPS of $0.44 vs. $0.41 with revenues of $2.98B and announced a share buyback of $5B. After Hours, shares up $3.00 or 6.76%.
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