Bill Cara’s Blog for Jul 9, 2012

CTA Trading Desk Morning Report

[7:00am ET] Good morning, Geoff here.

A trader needs to use his/her experience to anticipate the positioning of assets.

A trader needs to use price confirmation to position assets.

Those two statements are diametrically opposed but that is why trading is referred to as an art, not a science. Yes, there are firm trading rules based on mathematics, but sometimes experience can be just as valuable.

So, if you look back at my morning notes, you will see positive statements regarding energy and material stocks prior to their pop higher. I don’t like to give trading specifics on these pages but you could probably tell that we were adding to positions going into last weekend (Bill actually mentioned our relative weighting to the S&P 500 in his WIR 8 days ago and this prior weekend). Those positions had firm stops on them but those stops were not needed because the stocks popped.

Truth be told, I was feeling pretty darn good about those trades being placed in anticipation of the pop but before price had risen. That meant that we did not have to chase the trade as others had to.

However, within a few days, we had to go back to price confirmation as the US Dollar strongly reversed course. In the chart that I posted on Friday, I showed you how the dollar moved to new highs which turned our short-term “risk on” view on its head.

Yes, our long-term view is that central banks will do whatever is necessary (read; money printing) to stave off deflationary pressures and those actions will drive commodities and especially gold, higher. But, a rising dollar will place downside pressure on those same assets in the short-term. The same forces that may drive the dollar up and gold down in the short-term will drive the dollar down and gold up in the long-term which makes things difficult. The risk of getting kicked out of the long-term gold bull due to short-term drawdown concerns is rising. The same goes for the other commodity markets.

So; we could not ignore a new high in the dollar and had to pare back on the position sizing of those assets before the weekend in a short-term trade. Fortunately, by placing those trades early, we were taking gains and not losses but truth be told, I’m a little perturbed that the dollar threw a wrench in the trade – in the short-term at least.

With Spanish bond yields at roughly 7%, it is make or break time. If the sovereign debt vigilante shorts continue to win, the euro will fall and the dollar will rise – so, we had to be aware of that possibility and take our small profits off the table before they became losses.

Should those same sovereign debt shorts get squeezed out of their positions; the euro will rise leading the dollar to form a double top. In this case, we will move back to overweight various commodity producing stocks.

In other words; it’s all in the dollar.

[inline:ggimage01_071012.png]

Have a great trading day!


Here are the 7:00am ET snapshots of the latest equity market trading results for Europe, and futures prices plus 5-minute charts of the futures for S&P 500, 30-year US Treasury Bond, US Dollar index, Gold and Crude Oil.

Symbol Name Last Trade Change Related Info
^ATX ATX 1,945.15 6:44AM EDT Down 11.51 (0.59%) Components, Chart, More
^BFX BEL-20 2,208.00 6:34AM EDT Down 9.90 (0.45%) Components, Chart, More
^FCHI CAC 40 3,164.88 6:59AM EDT Down 3.91 (0.12%) Components, Chart, More
^GDAXI DAX 6,412.33 6:45AM EDT Up 2.22 (0.03%) Components, Chart, More
AEX.AS AEX General 309.32 6:45AM EDT Down 0.52 (0.17%) Components, Chart, More
^OSEAX OSE All Share 457.10 6:45AM EDT Down 0.24 (0.05%) Components, Chart, More
^OMXSPI Stockholm General 317.39 6:44AM EDT Down 0.47 (0.15%) Components, Chart, More
^SSMI Swiss Market 6,171.30 6:45AM EDT Down 12.37 (0.20%) Components, Chart, More
^FTSE FTSE 100 5,649.34 6:45AM EDT Down 13.29 (0.23%) Components, Chart, More
FPXAA.PR PX Index 898.30 6:59AM EDT Down 18.00 (1.96%) Chart, More
MICEXINDEXCF.ME MICEX Index 1,419.50 6:45AM EDT Up 3.70 (0.26%) Chart, More
GD.AT Athex Composite Share Price Index 651.98 6:44AM EDT Up 13.12 (2.05%) Chart, More

http://finviz.com/futures.ashx

http://finviz.com/fut_chart.ashx?p=m5&t=ES

http://finviz.com/fut_chart.ashx?p=m5&t=ZB

http://finviz.com/fut_chart.ashx?p=m5&t=DX

http://finviz.com/fut_chart.ashx?p=m5&t=GC

http://finviz.com/fut_chart.ashx?p=m5&t=SI

http://finviz.com/fut_chart.ashx?p=m5&t=CL

The team will check in during the day, reporting in the Discourse when there is a new entry.

Enjoy your day.


Cara 100 Company research notes from brokers

July 9, 2012

Bed Bath & Beyond(BBBY)

Credit Suisse report
OUTPERFORM G. Balter
CP: US$61.85, TP: US$91, CAP: US$14.4b

Investments, Cost Plus Should Regenerate Growth Back To Mid Teens; Lowering Estimates

We recently visited with BBBY, which allowed us to better appreciate what makes this retailer so dominant, and to understand how recent acquisitions fit into future growth while also reviewing near term challenges.

After a few years of above trend growth driven by competitive closings, strong product drivers and an improved consumer, we view the near term as a reinvestment period for better growth in 2013 and beyond. At 12x earnings, there is, we believe, good value in the name, as even in this slower year we envision double-digit growth.

What makes BBBY so successful? It is a combination of employee empowerment and a management not willing to rest on its laurels. This is a retailer that comes to market allowing the store manager to treat the store as their own, merchandising to the market. Combine that with a management team that assumes the worse each quarter, and one gets the success of
BBBY, a success unmatched by but a handful of retailers.

The investment issue is balancing that success with the challenge of the Internet. Specifically, can BBBY translate its unique customer service strengths to maintain above-average returns as more volume moves online?

Near term, we expect the lack of a visible hot product, investments to fight AMZN, and integration costs of recent acquisitions will limit earnings growth. That is reflected in the valuation. However, beginning with Q4, or possibly middle of next year, we see potential for midteens growth, which makes this quality retailer one of our favorite names to own. We are
lowering our ’12 estimates to $4.59 (from $4.67) to reflect purchase accounting amortization from Cost Plus as well as the inclusion of February for Cost Plus. We are lowering our F2013/F2014 EPS estimates to $5.30/$5.85 (from $5.34/$5.91).


Vad’s Catch of the Day


Kaimu’s Sound Money


Deron’s Daily ETF Analysis

From March through Late June of this year, the S&P Select Consumer Staples SPDR ETF (XLP) consolidated, forming a potential support base for a breakout. On June 29th, XLP broke out from this base to set a new 52 week high. Further, this breakout occurred on a substantial uptick in volume. Over the past two sessions, XLP has pulled back and could provide a buying opportunity on an undercut of its 10-day and/or 20-day moving averages. We are monitoring this ETF closely for the formation of a reversal candle that could serve as an entry pivot in XLP.

GLD

UNG reversed sharply on high volume yesterday and now appears in jeopardy of testing the June 28th swing low. Based on Friday’s poor performance, we are making a judgment call and exiting UNG at the market on the open. It’s always difficult to gauge market action when volume is light. Last week’s market action was further complicated by the holiday shortened trading week. Our market timing model still reflects a buy signal but we now need to see better price action from our open positions. Ultimately, in trading, price action is all that matters.

The commentary above is an excerpt from The Wagner Daily newsletter, which we have been publishing since 2002. Subscribers to the full version receive our exact entry and exit prices for swing trades of the top ETF and stock picks, access to our market timing model, and more. To get started today, sign up for your 30-day risk-free trial to our Wagner Daily stock newsletter or visit our trading blog to learn more about our proven technical trading strategy.


OptionOracle


Harp’s Roadmap


Cara on the Metalminers


Cara on the International Markets


CTA Trading Desk Mid-Day Report


CTA Trading Desk Post-Close Report


  1. 11:30 AM ET 3-Month Bill Auction 11:30 AM ET 6-Month... [#110951]
    By: davefairtex (5215 comments) Go to top ↑
    • 11:30 AM ET 3-Month Bill Auction
    • 11:30 AM ET 6-Month Bill Auction
    • 3:00 PM ET Consumer Credit
  2. 4 in Buy alert 3 in Distribution Zone 4 in Sell... [#110952]
    By: davefairtex (5215 comments) Go to top ↑
    • 4 in Buy alert
    • 3 in Distribution Zone
    • 4 in Sell alert

    Accumulation Zone (7%): Monthly 12, Weekly 8, Daily 1
    Distribution Zone (8%): Monthly 10, Weekly 8, Daily 7

  3. Hussman makes an interesting connection with the comments... [#110954]
    By: Grym (5467 comments) Go to top ↑

    Hussman makes an interesting connection with the comments on the human factor as presented by CaptK and privateer yesterday. See #110943

    Grym

    ——-
    What if the Fed Throws a QE3 and Nobody Comes?

    http://tiny.cc/kih6gw
    ——–

  4. Good morning. 15:00 Consumer Credit ------ MA ... [#110955]
    By: Bull Hunter (3552 comments) Go to top ↑

    Good morning.

    15:00 Consumer Credit

    ——

    MA – MasterCard downgraded to Sell from Neutral at UBS based on valuation and a weakening global consumer backdrop. MasterCard price target lowered to $403 from $457.

    ——

    “A traffic jam is a collision between free enterprise and socialism. Free enterprise produces automobiles faster than socialism can build roads and road capacity.” ~ Andrew Galambos

  5. ... [#110956]
    By: Les (7233 comments) Go to top ↑
  6. Outside the Cara 100 Universe: PAAS - The commodity... [#110957]
    By: Bull Hunter (3552 comments) Go to top ↑

    Outside the Cara 100 Universe:

    PAAS – The commodity company is cut to Hold from Buy at Deutsche Bank.

  7. Trade management for maximizing the profit while cutting... [#110958]
    By: Vadym Graifer (4338 comments) Go to top ↑

    Trade management for maximizing the profit while cutting down the risk:

    http://goo.gl/PPFBg

  8. Baz, you familiar with this one? Just received FDA approval... [#110959]
    By: BillySundance (1355 comments) Go to top ↑

    Baz, you familiar with this one? Just received FDA approval of the first ever home HIV test kit. They also have a number of existing testing products, etc. Seems a very natural product fit for one of the consumer products powerhouses like JNJ or PG. I caught wind of it because a fund I am in has a position in it.

    • Hi Billy... yes, was messing with it around $ 5 a couple... [#110960]
      By: baz22 (2871 comments) Go to top ↑

      Hi Billy… yes, was messing with it around $ 5 a couple years back… had noticed the run in the past week… not in… not sure how things would play out, since it seems like an every now & then use, unless one gets bad news…. but, there are quite a few ‘ risk takers ‘ in this ol’ world… wondering how it might work out in developing countries…

      • Sounds to me like at-home HIV testing could be a fairly... [#110961]
        By: BillySundance (1355 comments) Go to top ↑

        Sounds to me like at-home HIV testing could be a fairly large new market. I think people who are 99.99% sure they are not infected with HIV would still be willing to pay for an occasional at-home test to confirm that last 00.01%. Those that do not actually believe they are positive are likely reluctant to go to the extent of requesting lab tests and informing their doctor/health insurance that they would like testing and thus do not get tested or only get tested when lab tests are done for a physical. Will be interesting to see how things play out with this one….product hits 30,000 shelves in October

  9. http://mfgfacts.com/2012/07/09/between-freinds/ Some of... [#110962]
    By: Bill Cara (4105 comments) Go to top ↑

    http://mfgfacts.com/2012/07/09/between-freinds/

    Some of you may find this story interesting. Some of you may even be disgusted.

    • All I can imagine is that Corzine and friends have the... [#110964]
      By: davefairtex (5215 comments) Go to top ↑

      All I can imagine is that Corzine and friends have the folks in the government over a barrel in some way. It feels like there’s mutually assured destruction and this close to the election result nobody dares prosecute anyone for anything for fear it will all come unglued.

      Looks like someone didn’t use a long enough spoon when supping with the Devil.

      Someday, somebody will pull on a thread long enough and hard enough, and the whole thing will come unraveled. At least that’s what I tell myself.

  10. Here's an excellent comment on the state of affairs of... [#110963]
    By: MoKat (531 comments) Go to top ↑

    Here’s an excellent comment on the state of affairs of Europe and the US by JH Kunstler.

    http://kunstler.com/blog/2012/07/the-drowning-pool

    The Drowning Pool

    By James Howard Kunstler
    on July 9, 2012 8:56 AM

    News that that a swarm of termites deep inside the British banking system have been fiddling the interbank interest rates (LIBOR) for years in order to systematically vacuum a few billion pence off the exchange floors for themselves is the latest blow to the credibility of the global money system – and probably a fine overture to a looming climactic implosion of the gigantic, creaking, smoldering, reeking, duck-taped edifice of broken promises, booby-trapped hedge obligations, counterparty follies, central bank euchres, sovereign flim-flams, and countless chicanes too various, dark, and deep to smoke out. Next, we’ll probably hear that Lloyd Blankfein over at Goldman Sachs has been tinkering with the rotation of the earth in order to gain a few micro-milliseconds of advantage in his firm’s high frequency trading rackets. After all, back in 2008 Lloyd himself claimed to be “doing God’s work.”
    In short, world banking is now hopelessly pranged, and I am not at all sure the project of civilization (modern edition) can continue by other means. The impairments of capital formation are now so profound that no one and nothing can be trusted. Not only are all bets off, but nobody will want to make any new bets – and by that I mean venture to invest accumulated wealth (capital) in some useful project designed to sustain human well-being. What remains is just the desperate hoarding of whatever remains in assets uncontaminated by the pledges of others to pony up.
    All this points to a dangerous new period of political history, a deadly Hobbesian scramble to evade the falling timber in a burning house as the rudiments of a worldwide social contract go up in flames. Such is the importance of legitimacy: the basic condition for governance, especially among supposedly free people. You can meddle in a lot of distributory issues – who gets what – but when you mess with the most basic operations of money to the extent that no one is sure what it’s really worth, or what it represents, then you are deeply undermining society. This is now the condition that is set to blow up republics.
    Reality dislikes fraud and accounting tricks. Reality is serious about settling scores. Reality eventually intervenes and puts an end to monkey business. What will it be this time?
    Europe and America have been buying a month here, a month there (of a fragile, continuing status quo) on the installment plan. That’s what QE, TARPs, LTRO, EFSF, Operation Twist, et cetera, are all about. Think of them as multi-billion dollar (euro) fire extinguishers bought on credit cards. Europe is now completely out of credit to buy more fire fighting equipment. For months now it has been down to whether Germany intends to keep supporting Spain, Italy, Greece, Portugal, Ireland, the French banks (and a few stray forgotten places between the backwaters of the Danube and the Gulf of Finland) without any say in how they manage their allowance. Much as Germany enjoyed the Ponzi heyday of the Euro zone, a big “tilt” sign now flashes ominously over the continent, signaling game over. All fall down. Everybody gets real poor real fast. M. Hollandaise over in Paris has already sealed his fate with his stupid plan to return to “go” on the Ponzi game-board. Merkel’s tattered scarecrow of a coalition will blow away in the next national election. The Club Med countries will soon boil up in street-fighting, Holland and Finland will drink themselves to death, and across the channel outsider Britain will fizzle away to a burnt bowl of mulligatawny. That’s what the end of the summer looks like to me.
    Over here, in this sorry-ass edition of America, the election will look more and more like a World Wrestling Federation staged dumb-show between two catamite hostages of a foul corporate oligarchy. Imagine that horse’s ass Mitt Romney spending the next four months denouncing Obama-care, modeled on his own health care reform in Massachusetts, while Obama pretends he has a grip on an economy where the rule of law is absent due to Obama’s own omissions and negligence.
    And if you can’t stand that spectacle, just look around at America itself: a wasteland of futile motoring and discount shopping populated by depressed, overfed clowns bedizened with sinister tattoos, pretending to be Star Warriors. No nation ever seen in human history ever laid such a disappointing egg. Only to have it fry on the sidewalk.

    • and that is why I am slowly adding to my weapon-related... [#110965]
      By: baz22 (2871 comments) Go to top ↑

      and that is why I am slowly adding to my weapon-related equity… did all those 300 lb. tattoo whales ever stop to think what that wrinkled blob of ink will look like in 30 yrs….?

  11. how does one interpret this? I was watching the options on... [#110966]
    By: 14them34me (295 comments) Go to top ↑

    how does one interpret this? I was watching the options on a few gold stocks this morning. All of a sudden there were transaction of 1000 put options went through higher than the asking price on certain gold stocks. Manipulation ? Is this a good sign or bad for the underlying stock ?

    • I'm not sure what the situation is exactly, but options... [#110969]
      By: BillySundance (1355 comments) Go to top ↑

      I’m not sure what the situation is exactly, but options trade on a number of different exchanges, and each exchange may have its own bid/ask. For instance, IB will give you the option of executing at the best bid/ask OR you can specify an exchange (I am not sure why anyone would want to prefer an exchange over best price but there may be some reason).

      So, perhaps you were looking at bid/ask for one exchange while transactions were made on another exchange that were outside of the bid/ask you were looking at? That’s my only guess.

      I am of the opinion that observing an options trade alone does not give any indication of future pricing and thus is neither “good” or “bad” sign.

      • thanks Billy. I'm using TD web broker so I assume the... [#110972]
        By: 14them34me (295 comments) Go to top ↑

        thanks Billy. I’m using TD web broker so I assume the bid/ask was on the Montreal Exchange. Nonetheless, 1000 put is equivalent to 100,000 shares. I suppose it would be an institutional trade unless it’s a wealthy individual. As observed, it was the Aug put for both ABX and G.

        • The reason I say you can't determine whether it is an... [#110976]
          By: BillySundance (1355 comments) Go to top ↑

          The reason I say you can’t determine whether it is an indication of bullish/bearishness is that you can’t see what else is in the portfolio.

          The impulse is to say, wow, someone bought 1000 at-the money puts on ABX, someone must be bearish. But perhaps they have a long position of 100,000 shares and are simply trying to neatralize their risk.

          There is no way to deduce future price direction from observing an options trade. If there was we would all be fabulously rich option traders!!

          • I understand. Thanx... [#110978]
            By: 14them34me (295 comments) Go to top ↑

            I understand. Thanx Billy.

          • Got it. So to close my position, I would theoretically have... [#110979]
            By: SyncMaster152T (166 comments) Go to top ↑

            Got it. So to close my position, I would theoretically have to cover the short call (if exercised), then exercise my long call to get the profits.

            ex. If the long call has a strike price of $10, and the short call has a price of $15, and the SP goes to $17. Lets assume 1 contract.

            I would have to buy 100 shares at $17= $1700. Sell them at $1500 to cover short call. Then I would call my long call at $10, paying $1000 and sell them at $1700.

            Overall the profit would be $500, less any commissions and premium for long call and plus premium for short call.

            Did I do that correctly?

          • Sync, sounds like you got... [#110981]
            By: BillySundance (1355 comments) Go to top ↑

            Sync, sounds like you got it.

          • that's a lot of exercising ! what I mean is, using your... [#110983]
            By: 14them34me (295 comments) Go to top ↑

            that’s a lot of exercising ! what I mean is, using your example, stock price $17:

            your LONG call $10 would be worth $7 (ie. assuming $0 time premium)
            your SHORT call $15 would be worth $2 (ie. again assuming $0 time premium)

            then, you would buy back your SHORT call, and sell your LONG call for a difference of $5.
            You should be profiting if you had done your spread with a difference of <$5 when you initiated your spread.

          • I've never actually bought back a call I had previously... [#110984]
            By: SyncMaster152T (166 comments) Go to top ↑

            I’ve never actually bought back a call I had previously sold! Good thinking. I completely oversaw that possible trade.

            What do you mean by “You should be profiting if you had done your spread with a difference of <$5 when you initiated your spread.”

            Wouldn’t I still profit if the spread was greater than $5?

          • Example, Stock at $10, you initiated your bull call... [#110987]
            By: 14them34me (295 comments) Go to top ↑

            Example,
            Stock at $10, you initiated your bull call spread:
            Buy call $10 @ $1.00 // Sold call $15 @ $0.10 (initiated Bull Call Spread COST $1.00-$0.10=$0.90)

            Then stock rises to $17, you close out your spread:
            Sell call $10 @ $7.00 // Buy call $15 @ $2.00 (close out spread for $7.00-$2.00=$5.00)

            Profit=$5.00-$0.90=$4.10

            Hope that helps. Of course we are living in a dream world with this example. The stock actually jumps 70% within the expiry months !

          • Basically I have to ensure that my net debit when... [#110988]
            By: SyncMaster152T (166 comments) Go to top ↑

            Basically I have to ensure that my net debit when initiating the bull call spread must be less than the total proceeds?

            So when initating a spread, first calculate what the total net debit is (cost of long call-proceeds of short all), add it to the strike price of the long call to determine your break even point.

          • In order for you to have a good chance of success, I'd... [#110990]
            By: 14them34me (295 comments) Go to top ↑

            In order for you to have a good chance of success, I’d first assess what the chances are that the underlying stock would go up within the expiry months. You’d stand a good chance of success if the stock goes up to the exercise price of the call you sold in the spread. Also, I would assess whether the option spread prices (buying and selling) is worth while.

    • If you meant the put options were traded higher than the... [#110970]
      By: SyncMaster152T (166 comments) Go to top ↑

      If you meant the put options were traded higher than the asking price of the underlying asset, this could mean the market sentiment is ultimately negative, as they believe the SP will sink further which makes the value of the put option rise. The market, in this case, believes that the SP will not rise above the strike price of the put option.

      If the expiry date for these options is within a month or two, the predicted short term future is negative. If the expiration prolongs to lets say six months, there must not be any good news or expectations ahead.

  12. Just a quick question on bull call spreads. If one does... [#110967]
    By: SyncMaster152T (166 comments) Go to top ↑

    Just a quick question on bull call spreads.

    If one does reach max profits (the SP rises to the short call) wouldn’t this mean the short call may be exercised, forcing the person to fill the order at the current market price?

    • my understanding is if you sold a call and the underlying... [#110968]
      By: 14them34me (295 comments) Go to top ↑

      my understanding is if you sold a call and the underlying stock rise to or above the exercising price, it can be exercised and you are obligated to deliver the stock at the exercise price (on or before expiry).

      • Yes that is the way call options work. The buyer has the... [#110971]
        By: SyncMaster152T (166 comments) Go to top ↑

        Yes that is the way call options work. The buyer has the right to call the shares. But what I meant was, max profits for bull call spreads is reached when the SP rises to the short call. However, if the person does call you on the short call, wouldn’t that mean you would lose money since you would have to fill their order? And therefore you would be left with: paying for the shares (a negative), the gain on the premium from selling the short call (a positive), the loss from buying the long call (a negative). Ultimately losing money?

        • You would actually have a gain on the purchased long call... [#110973]
          By: BillySundance (1355 comments) Go to top ↑

          You would actually have a gain on the purchased long call (not a loss)

          • You would have a loss, because buying the long call would... [#110974]
            By: SyncMaster152T (166 comments) Go to top ↑

            You would have a loss, because buying the long call would mean you would have to pay the premium of the option. (Without actually exercising the long call. If you exercised the long call, and the SP rose, then you would have a gain)

            So does this mean that if the SP rises to the short call, one would have to fill the short call (if exercised) and then call the shares from the long call to actually get the max profit from the bull call spread?

          • you are correct in principle. However, your LONG call... [#110977]
            By: 14them34me (295 comments) Go to top ↑

            you are correct in principle. However, your LONG call should rise in premium faster than the rise in premium on the SHORT call. So theoretically you could close out your spread with a profit.

          • I... [#110975]
            By: 14them34me (295 comments) Go to top ↑

            I concur

  13. for non-FB users, trade management for maximizing the... [#110980]
    By: Vadym Graifer (4338 comments) Go to top ↑

    for non-FB users, trade management for maximizing the profit while cutting down the risk:

    http://tradinglog.realitytrader.com/2012/07/july-0

  14. Cara 100 Company research notes from brokers July 9... [#110982]
    By: Bill Cara (4105 comments) Go to top ↑

    Cara 100 Company research notes from brokers

    July 9, 2012

    Bed Bath & Beyond(BBBY)

  15. ... [#110985]
    By: Bill Cara (4105 comments) Go to top ↑
    • Ok, I've railed against AA at $16 and again at $12/shr... [#110995]
      By: Ilya (572 comments) Go to top ↑

      Ok, I’ve railed against AA at $16 and again at $12/shr. Maybe this dying quail has bottomed and is setting up for a trade but not with my money.

      At $8 and high change, the stock is trading $3 plus bucks above the low it set in 2009. Granted it has a ‘book’ over $13 a share but what does ‘book’ mean when you cannot consistantly earn your cost of capital. They are geared pretty high with 9 plus billion in debt and modest cash in the bank. Granted they are a slim margined commodity producer with high capital needs not unlike the base chemical companies which is where they belong for research coverage purposes…AA produces a metal but should not be covered by metal and mining analysts. Some of the smarter research firms lump coverage as ‘chemicals and aluminum.’

      Just as aluminum alloys replaced sheet steel over the past 50 years, composite fiber is now beginning to replacing aluminum. Aluminum can be produced anywhere where there is a relatively cheap energy source. Think three gorges dam or the wasted flaired gas in Baharian.

      I will give them credit for having model accountancy since they pride themselves on ‘first to report.’ Now if I can only find the line items for unfunded pension obligations and their assumed rates of future returns??????

      When I was a kid, I’d spend hours in the sporting goods store sifting through the archery arrows to find those priced at 6 for a dollar which were least warped. Along came the fiberglass arrow which were straight but waffeled in flight. Then evolved the aluminum shafts, light but were prone to bending. Now I shoot only graphite fiber. I see the chronology of the lowly arrow as precedent of what is to come.

  16. PCX finally filed for bk this afternoon, stock obliterated... [#110986]
    By: BillySundance (1355 comments) Go to top ↑

    PCX finally filed for bk this afternoon, stock obliterated after its last gasp super pop from $1 to $2.50 last week.

    Interesting action in CLD the past couple weeks though, moving from the $14s to $17s. CLD purchased some undeveloped Powder River Basin assets from CNX last week for $170m plus some royalties retained by CNX. I speculated a couple weeks back that CLD could try to poach Powder River basin assets from ACI if ACI got in a cash crunch. It still could happen as CLD is pretty much the only major operator in the PRB that is NOT leveraged to the gills.

    It’s kind of amazing how fast the mindset of coal companies went from the depths of the 2008 commodity fallout all the way to the eat or be eaten M&A environment of 2010-11. In many ways CLD kind of just got lucky that it was just getting spun-off from Rio Tinto a couple years back and thus was not an immediate takeout target (management did not have to eat to avoid being eaten) nor an acquisitor. But now they find themselves with great opportunities to snag great properties at fire sale prices.

  17. http://tinyurl.com/7jgrq6sick=1 RSI and MACD turned up... [#110989]
    By: ulvy (70 comments) Go to top ↑

    http://tinyurl.com/7jgrq6sick=1

    RSI and MACD turned up right around then.

  18. PFGBest missing $220-million in client funds, founder... [#110993]
    By: lowpickr (153 comments) Go to top ↑

    PFGBest missing $220-million in client funds, founder attempts suicide

    http://www.theglobeandmail.com/report-on-business/

  19. ... [#110996]
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