My stock pick for 2011.

I like sprint, a lot.
The reason:
Apple is gonna save their asses

For the first time in years they have added new subscribers, and they are the only player that offers unlimited data at such a cheap price.

                                  unlimited sprint

I bought the 2013 JAN 2.50 strike.
Why not just own it outright?

You can get more for your money with the 2.50 LEAPS, they go for around .80 cents, but you can put in an order limit for .60 cents and hope for a fill.

How high could this stock could go?
S&P has a 5 dollar price target for the next 12 months- I believe it could go higher. Sprint got the 4s exactly when jobs died, and if the iPhone was going to sell before his death, you know that after he passed, people have put this product on their short must have list that for xmas.

You can hear the cash registers working overtime once S got the iPhone, think of all those new contracts.

“The launch of this iconic device resulted in Sprint’s best ever day of sales in retail, web and telesales for a device family in Sprint history. The response to this device by current and new customers has surpassed initial expectations. The iPhone is expected to be accretive for Sprint, and iPhone users are expected to be among Sprint’s most profitable customers.”

The money is rolling in!

The problem with S; before the iPhone there was zero subscriber growth, and too much debt. They still have a lot of debt, but- soon, they are going to have a lot of cash to pay it down.

Another caveat, if the iPhone 5 is garbage, If no one buys the iPhone 5, sprint goes bankrupt.

I also like Sprint as a cheap and indirect way to gain some exposure to Apple stock.

Since Sprint had to commit 20billion on Apple- the two company’s fates are intertwined for the time being.
Give Apple credit, they were like- you want the iPhone- that will be 20B please. Damn!
If S sells all of those phones the incurred debt will be paid back.

Once Sprint finally got the iPhone, customers began to voluntarily switch from At&t and Verizion- the Sprint unlimited data plan is a steal.
If they can take market share from At&t and Verizon, S can become a big player and a real rival.

They bet it all on the iPhone, to put this in the proper perspective, the 20billion they committed to this deal is worth almost triple Sprint’s current market cap.

Just a little PSA, As far as Michelle Bachman goes.

Is there anyone that lies more than Michelle Bachman?
Every time Bachman opens her mouth, I am amazed at the veracity of lies that spew from the bowels of GOPSatan.

Take a look at her stats from politifact.

Egads, at least fifty percent of all of her statements are either mostly false, or entirely false.
Keep in mind; this is with a generous splattering of mostly true’s from a site with an obvious rightwing bent. Many believe politifact has to distort facts in order to grade republicans with some “mostly true” statements.

When it comes to the left however, they really go out of their way to find a minor technicality when they check a democratic quote they grade as a “mostly false” talking point.

Newt could potentially destroy Obama at the debates.

Newt is an obnoxious bully and he would dismantle Obama.

Out of all the potential matchups, I think Newt is the only one that is going to throw Obama off his game in the debates.

If you think I’m wrong, ask yourself this: Is Obama Milquetoast, or does he bring the heat?
Now image him arguing with a cantankerous, lying, bullying, blowhard.
Newt would eat Obama’s lunch, and what’s Obama gonna do about it?
No one else running for pres would present a challenge to Obama in the debates, but Newt is dangerous.

Before you dismiss this outright- consider this.

Many consider Newt to be a carbon copy of Cheney or McCain, this isn't true, they both had uncontrollable rage, but they were unable to express that rage in a cogent way.

Newt is a much bigger and polished bully than most.

McCain would just snarl, and grumble. Newt is much more lucid with his lies, he will be able bash Obama with his snake oil bottle in the fox news tradition.

Don't get me wrong, i despise Newt, but if you watch him at the debates, you will see that he will be able to go after Obama's weak points.

No one else on that stage would get the better of Obama, but Newt gives me pause.

They all lie, but they don't have the oratory skills that Newt has. Neither Cheney nor McCain posses the ability to convince millions of Americans that the BS they spew is intellectually driven- Newt has this ability .

Newt is Full of BS, but he can sell it by pretending his is an intellectual.

Newt is a lying thug and a bully with oratory skill, Obama has no defense against someone with this skill set.

Does newt bully the moderators? Do they back off when he does?
Does Obama stand up to bullies or does he capitulate?
Did Obama earn his Compromiser-in-Chief moniker?

Ask yourself this: if you had face-down a bully, would you take Newt or Obama?

Make no mistake, Newt is slime, but Obama can't debate with a snakelike bully.

Say what you will, if it makes you feel any better, shoot the messenger (me) if you will. None of this will change the facts.
Has Obama taken on the Tea Party bully on his own? Has he put the Tea Party in its place?
If it wasn’t for auxiliary support from Elizabeth Warren and the Occupy movement, Obama would be flailing even worse than he was during the debt ceiling fiasco.
This man doesn’t know how to deal with bullies. Newt, unlike Bush / Cheney / McCain / Perry can intimidate, while he gets his Fox news talking point across. Obama can’t counter a petite Fox news talking point with a 4 paragraph refutation, which cites stats, figures and facts in its defense.

One last note.
Just because Obama did well in the democratic debates, that doesn't mean he will be able to hold his own against Newt.

Just remember, Hilary Clinton and Edwards were saintly truth tellers compared to the current crop of GOP candidates.

Hilary and Edwards kept it civilized and the democratic debates were intellectual at their core.

Obama's weakness is Fox News / tea party talking points. and no one at the GOP debates is better at conveying those lies than Newt.

Mittens is a wimp, Bachman is possessed, Cain / Perry, sigh... can they even remember those three line talking points?
Newt is the only one that can effectively bash Obama with lies.

Fed chair Alan Greenspan Recommends, cutting taxes on the rich- to grow the debt.

Greenspan Suggested Cutting Taxes on the Wealthy to Increase Debt so the Fed Wouldn’t “Lose Control of Monetary Policy”

Back in January 2001, just as George W. Bush was entering office, Federal Reserve Chairman Alan Greenspan was worrying; If the U.S. totally paid off its debt, it would no longer need to sell off Treasury bonds to borrow money. To avoid that scenario, Greenspan ended up endorsing tax cuts as a way of reducing surpluses. The Bush administration happily obliged

read the entire story on NPR.


life after debt, secret fed document on the debt.
Don't let anyone tell you taxes on the rich won't help to pay down the debt. Greenspan favored Tax Cuts To Reduce the Surplus and increase the debt. If we tax the rich, we can restore fiscal sanity.

Opponents of tax cuts are dismayed that Federal Reserve Board Chairman Alan Greenspan supports reductions in the federal tax burden. His reasoning implies that paying off the national debt is not a good idea.

read more here.

max baucus is not a democrat- stop calling him one.

The mainstream media loves to denigrate the democratic party- they castigate the dems as ineffectual and weak, they cite high disapproval numbers for dems as proof that this is a conservative country.

That’s only one side of the story.

The popular narrative is that Obama had democratic majorities in the house and the senate, but with max baucus, joe Lieberman, and ben nelson on your side, who needs enemies.

There were 54 blue dogs in the house, after the 2010 elections the blue dogs got shellacked and only 26 were left standing.

The voters mistakenly thought the blue dogs and the party they were pretending to represent were the problem, so they replaced them with tea party zealots.
Ironically, they hated the republican ideology that the blue dogs practiced, yet they replaced them with people that were even more to the right!

On this site people have become despondent to the Democratic Party. And one of the main reasons is the blue dog congress members and the DINO senators that have sabotaged the party and this country.

The media is all too happy to pretend that Baucus and Nelson represent the Democratic Party; nothing could be further from the truth.
Putting Baucus on the super committee was an affront to all liberals- but when he compromises or when he pretends to bow to republican demands because he had no choice, the media will spin the tale of democratic weakness that ultimately lead to entitlement cuts.

If DINO’s go for cuts to entitlements, and no taxes on the rich, voters will ask:
“What’s the point of the democratic party?- they are just as bad, maybe worse than the republicans.”

The blue dogs / DINO’s have sabotaged and diminished the party; it’s time we called them out for it.

We can make a difference, since Erin Burnet made a mockery of Occupy, her ratings have plummeted.
David Gergory, is a shill, the sooner we get the mainstream to understand that, the better.

DINO’s aren’t democrats- next time they screw the dems over- it has to be understood that they are right wing extremists in disguise.

Illinois workers pay taxes to their employers, not to the state. read on.

If that headline had you confused- here it is again.
Some companies in Illinois have convinced the government to let them pocket their workers taxes.

In other words, if you work for one of these companies, the taxes that are deduced from every paycheck don’t go into the governments coffers- they go to the company you work for.

Tax dollars that would normally flow into the state treasury to pay for education and other necessary state services never make it there- instead these taxes go towards CEO bonuses. The corporations that get these sweet deals get to keep the money from their employees that would normally go to the state free and clear.

Why would the government agree to this?

The Illinois government was desperate to keep companies in state, so they went looking for a solution that could reward the job creators.

Usually states offer tax incentives, to entice companies to stay, trouble is- these companies either pay zero state taxes, or the minimal amount they pay on taxes weren't enough of an incentive to stick around.

The Illinois government knew that if it had to write a large check to these companies to stay in state, it would look ugly. Some might call it a kickback, others might say it was extortion.

Either way, the solution was to let the businesses retain worker paid for taxes as they were generated.

Sounds like the people that work for these companies, aren't getting necessary services for their tax dollars. You know, little things, like police, fire departments, roads, schools. Oh well, who needs the police anyway. Better that those tax dollars contribute to the corporations profits. Call me cynical, but it sounds like the workers are actually paying their employers for the privilege of having a job.

funny that, i thought the job creators were supposed to pay employees.
call this what you will, but this isn't capitalism, it isn't a free market.

If this continues- you need to know that it isn't a zero sum game.
As the federal government cuts back financial aid and subsidies to states, it will starve the states of revenue.

Every single republican running for president wants to eliminate capitals gains taxes, and corporate taxes.
If they do that, the states will have to raise tax rates on corporations. Businesses will threaten to move from one state with high taxes, to a state with lower taxes. Finally, when the tax rate is zero in every single state, the job creators will still demand larger and larger kickbacks.

When that isn't enough if an incentive- what then?

read more here.
you can view the story here.

Paying the corporate overseers for the privilege of having a job, sounds like feudalism doesn't it?

Admittedly, I was slow to catch on; but if you look at those on the far right, namely the Koch brothers, Cain, Perry, Bachman, and Paul Ryan, they all pay lip service the Constitution, to freedom, but- what they really want- is to make us all serfs!

If we are the serfs, who would the feudal lords be?

Call what the far right believe in- feudalism, corporatism, fascism- it doesn't matter, what does matter is that they do not believe in democracy.

CNBC: Is this Michelle Caruso Cabrera?

Daily Free Kindle Books
Many people seem to think this is her- I'm not so sure.
I report- you decide.

Her book and other pics.

Need a balance transfer?

This is the card for you.

21 Months at zero percent interest is the best deal available, anywhere.
If you don't need a balance transfer, take the cash and invest on some I-bonds which are yielding over 3% at the moment.

‘Zombie’ Properties coming back to life.

Is it finally time to buy that vacant property so that it can be rented back out?

Open question to all:

I’m frozen when it comes to RE, do i want to purchase a cheap property to rent, or should i put that same amount of money into a few REIT ETF’s?
Instead of a mortgage, one can purchase a REIT ETF on margin. In lieu of monthly mortgage payments, pay down the margin monthly.

In your opinion- you think a REIT ETF investment purchased today, can outperform purchasing a rental unit over the next 30 years?

What kind of REIT ETF do you favor (equity, mortgage etc)- and do you favor a REIT ETF over an actual property?

What say you?

*I prefer a REIT ETF's over any individual REIT- less risk, more diversification.

Silver and Gold on the move.

Gold ended the week at $1747.20 per ounce while silver posted gains of 0.3% to finish at $35.29 per ounce.

On the week, gold rallied for approx $105 or 6.3%, while silver futures surged $3.65 or 11.5%.

Both metals had fallen over 30% during the recent market swoon but they are climbing back, silver especially has had an impressive move.

I remain bullish on both for the foreseeable future and i sell calls or puts on them as the market dictates.

Crude oil futures, closed at $93.32 per barrel.

Finally, Natural gas rallied for 4.1% to close at $3.92.
Natural gas Futures were aided by cold snap that has hit the east coast. I play nat gas with the ETF UNG, I believe natural gas it is a great multi-year play at these cheap prices. Out of all commodities natural gas might be the only one that hasn't rallied, until now that is.

Fall Reading and Cookbooks.

The cheapest diapers you can buy today.

Saving money, is the same as making some. If you have a baby, you know that money is hard to save.
I’ve checked and cross checked diapers everywhere, the best I can tell is Amazon has the best prices bar none!


They are cheaper than diapers.com and way cheaper than babies r us.

There is one catch to getting the cheapest diapers in the known world at Amazon, you need to sign up for an ingenious little program that they have running.
Click on the diaper banner and sign up right now.


Amazon has a new program called “Subscribe & Save”.
All you need to do is enroll to receive a new shipment of items in the time interval you select. The discounts are pretty steep and once you set a schedule you never need to order those same items again.
You can adjust the number of items or the schedule as you need.

If you combine the suscribe and save program with the Amazon Mom membership you can save a ton on diapers and wipes. Both memberships are free and they will save you a ton of money. Sign up today.

With all of the discounts in place you can get diapers for .17 cents each. That is an unbeatable offer, diapers.com with all of their coupons can’t compete.

*Amazon Mom is a free membership program aimed at helping parents and caregivers, from the prenatal days through the toddler years, use Amazon to find all the products their family needs. To join, simply sign into your Amazon account and tell us whether you are a Mom, Dad, or other caregivers of a child. By providing information about your family, you can help us personalize offers, e-mails, and product recommendations to help you find exactly what you need at just the right time. Amazon Mom members receive benefits such as 30% off diapers and wipes, exclusive offers, and FREE Two-Day Shipping with Amazon Prime.

First Netfilx, then Amazon, Apple is next.

Months ago i recommend purchasing way out of the money puts on all three.
Netflix and Amazon Puts that were 40 points out of the money went up, on average 400%.

Don't get me wrong, i love Amazon, it isn't going anywhere as a company but right now, the market is looking to smite these high flying stocks.

Get out of the way, DO NOT GO LONG- any of these stocks.
With consumer spending and sentiment in the toilet, we need to wait it out. The shorts aren't done with this one yet.

The death of Steve Jobs marks the end of American exceptionalism

The death of Steve Jobs marks the end of American capitalism.
The death of Steve Jobs marks the end of American consumerism.
The death of Steve Jobs marks the end of American innovation.

Make no mistake, he was a great man, an influential man, he wasn't perfect, but he didn't need to be.

When a man of his stature passes, it is a forceful reminder, a shock to the American collective- we are mortal, and our time will come.

Some are wondering why this news has hit them so forcefully and emotionally. We only need to look around us, at the depressing headlines to find the answer.
Americans will, and should shed tears for the loss of what Steve Jobs represented- what America once was.

We aren't the same nation we were when Jobs first rose to prominence, if we don't get our shit together, we will never get there again.

Jobs family's statement on death of Apple founder

Jobs family's statement on death of Apple founder



Steve Jobs' family today made the following statement regarding his death:

Steve died peacefully today surrounded by his family.

In his public life, Steve was known as a visionary; in his private life, he cherished his family. We are thankful to the many people who have shared their wishes and prayers during the last year of Steve's illness; a website will be provided for those who wish to offer tributes and memories.
We are grateful for the support and kindness of those who share our feelings for Steve. We know many of you will mourn with us, and we ask that you respect our privacy during our time of grief.

Apple's Board of Directors said Wednesday in a statement.

"We are deeply saddened to announce that Steve Jobs passed away today," "Steve’s brilliance, passion and energy were the source of countless innovations that enrich and improve all of our lives. The world is immeasurably better because of Steve."

Apple founder Steve Jobs dead at age 56

Here are some words of wisdom from Steve Jobs, an American icon.



this speech is poignant, and sad.

Here are the facts on Obamacare.

Wait! If you don’t need medical coverage, don't ignore this message, I’m serious.
Even if you don't need it today, you will tomorrow, or someone in your family will.

The GOP (the tea party in particular) has succeeded in scaring the crap out of average citizens when it comes to Obamacare.
We need a frank and fact based discussion that people can follow and learn from.

The truth is- most Americans don’t understand how pathetic and expensive the current state of health care and health insurance is in this country.
It isn’t until one gets sick, or someone tries to decode the convoluted web that is health insurance that you begin to decipher a system that is byzantine in its bureaucracy and indefensible in its costs that are unaffordable for most. Healthcare is a basic human right, without it, we suffer needless loss of life and dignity.

I need to preface this discussion with a few facts:
The young and the lucky just go for regular checkups and pay a nominal co pay, they think all is well, until the unfortunate happens.
I am relatively young and healthy, it is only recently that my family and I have begun to use healthcare in earnest.
Many with insurance need to file for bankruptcy if they are diagnosed with cancer because of the exorbitant costs that are tied with treatments.
I am no expert in Obamacare, I can only provide what I think are bipartisan facts.
Please feel free to correct me if I am wrong.

1- Most of Obamacare doesn’t go into full effect until 2014
2- Obamacare allows young adults to remain on parents' policies until they turn 26.
3- Insurance For Pre-Existing Conditions must be given
4- Insurance For Pre-Existing Conditions is expensive
5- Under Obamacare all Americans will be forced to purchase insurance or they will be fined.
6- For those that think forced insurance is unconstitutional or impractical- think car insurance.
7- Obamacare will force employers to provide insurance or pay a fine of 2000 per employee.

1-employer-paid insurance, reported an increase of 9 percent, up from 3 percent last year.
2-annual premiums for a family of four climbed to $15,000 this year.

Annual employee contributions now total more $4,100 on average. That's more than 130 percent higher than back in 2000. The survey also found that, to cut costs, more employers are enrolling in high-deductible policies that cut annual premiums, but require employees to pay more out of pocket for medical care.

Watch the full episode. See more PBS NewsHour.

Watch the full episode. See more PBS NewsHour.

http://www.pbs.org/newshour/bb/health/july-dec11/insurance_09-27.html

Questions and solutions:

The theory goes: if everyone is insured, premiums collected will increase and the price of health coverage should go down.
This would be the ideal solution but, if it happens to lower premiums is a very large unknown at this point.

For many employers, a 2000 fine is less than they currently pay for insurance per employee. Will some unscrupulous employers drop costly insurance and choose to pay the fine in lieu of providing coverage?

Will fines for a lack of insurance become an unbearable burden on American citizens?

Will expensive insurance policies coupled with huge deductibles impoverish an already weakened middle class?

Why is a for profit healthcare system so damned expensive? It isn’t just the costs of record keeping and unneeded tests that jack the prices up. The tests cost too damn much, but so does everything else.
To suggest that digitizing records will be a panacea is a joke, and it should be treated as such to anyone who brings it up as a solution to medical costs. That isn’t to suggest that it shouldn’t be done, and it certainly will bring costs down, but it is akin to treating a gaping hole in a patients chest with a Band-Aid.

There is an underlying rot to healthcare costs in this country, and it is the most pressing issue imaginable.

Part of that ROT belongs to people like Herman Cain; he willingly obfuscates what Obamacare does or does not do for personal gain. He is a rich man, and as a rich man he can afford the best possible insurance imaginable. Obamacare wouldn't affect the treatments he is able to pay for or the outcome of that expensive care in any way.

There is no such thing as diversification.

If you are Long anything you are at risk. Short is the only true diversification.

The investing mantra goes, In order to lower risk one needs investments that do not correlate to US equities. The theory goes a portfolio with non correlated investments won’t move in the same direction as US equity indices- in truth- when the US enters into a bear market, so does every single other asset class. There is no protection in foreign stocks, currencies, or even commodities- if an equity fund gets hit with a margin call, they will dump currencies or commodities en masse.
There is only one true way to diversify, it’s by owning inverse (short) ETF’s in your portfolio. No 401k or mutual funds hold inverse ETF’s managers don’t even go to cash- so there is zero downside protection in your retirement fund.

Buy gold!

With gold down 30% this year, take a good hard look at the precious metal.

I know, I know, some will say: its up so much, it’s a bubble, it will crash- etc etc.
Ignore this, buy gold, but, buy it wisely.

Here is a four step process for your gold investment.

1- Sell OTM gold puts in order to take advantage of sky high volatility.
2- Buy some cheap way out of the money puts to hedge.
3- Purchase a 2x inverse gold ETF to hedge some more.
4- Sell calls once the gold is put to you.

If the puts expire in the money- the gold will be yours. If not, sell more puts.

Do not sell your inverse ETF as this will hedge some of your downside.
Sell the long puts only if the price plummets.

Hedge Hedge Hedge.

During the most recent downturn the markets are down 20%, my portfolio is up 3% during the same time period. I wasn’t as aggressive with hedges this year as I was during the 2008 swoon. My long term hedges worked, but I wasn’t position heavily for the short term. Perhaps the most important move I made was to go to cash in my 401k during the debt ceiling debacle. If you listen to the talking heads they want you to invest and forget your portfolio, they say over the long haul you will do better than market timers. This is a complete and utter lie. While I do agree when things are going well you can pay less attention to your investments, when things are as bad as they are now, you need to watch and more importantly act before a bad situation turns worse.

We all knew the country was in trouble, we all knew that Europe was struggling. Wages are down, unemployment is up, debt is unsustainable, yet the talking heads, the mutual fund managers never caution, they never sell your retirement account to wait in cash just in case the markets drop precipitously. When things look as bad as they did during the debt ceiling fiasco you can’t afford to sit idly by. You need to act!

I’ve said it before and it must be said again. HEDGE!
If you can’t, or don’t know how- go to cash. To make up for your temporary move to cash you can increase the amount you contribute to your 401k to the max. Just in case things don’t fall off a cliff and if they do you are still averaging down with your weekly contribution.

You can’t hedge in your 401k account but you can open a regular IRA and purchase inverse ETF’s and Puts in that account.
First thing you need to do in order to hedge is find out what that fund you have really owns. Is it heavily weighted in technology, small caps, energy?
Once you find the breakdown, you can purchase an inverse ETF in order to manage risk. An inverse ETF is an ingenious way to short; they go up as the market sector they represent goes down. For example, if you own a mutal fund that has 30% financial stocks, you would purchase SKF, or FAZ to hedge in your
Always hedge your 401k in a standalone account. Do the homework, find out what you own and find a creative way to hedge it in another account.

This market, the world and government is too volatile to just “set and forget” your investments.
Don’t get complacent; don’t rush in to buy all at once just yet. If Europe defaults we could easily drop another 50% this year!

If you do go long, you guessed it- hedge!

As far as Europe goes, lets not panic just yet, all is not lost; if you are long cash- you may want to consider buying the S&P 500 at some point. Currently, it yields more than the 10-year Treasury note. This is a rare event in the investing world. Take note of this factoid, but don’t run out and purchase the SPY just yet.

Here is an idea on a hedging strategy.
Purchase way out of the money puts on high flying stocks.

My favorite hedge?
As I mentioned on my previous post, I am long way OTM puts on (AAPL) Apple, if the market swoons, its going to take AAPL along with it.
[Image]

The Tea Party vs a Democrat.

A novel idea.

Instead of raising taxes on the “job creators” lets raise the minimum wage -substantially.

Want to get people off of food stamps?
want to broaden the base of federal income tax payers?
want to get people out of poverty?
want to increase personal saving accounts?
want to decrease consumer debt?
want to resurrect housing?

Then Double the minimum wage!

I know all the arguments against raising the minimum- but they don’t apply when inflation -real inflation- has destroyed purchasing power to the degree that it has.

Almost 90 million workers, or 85% of all working Americans earn less than thirty grand a year.
Thanks to inflation, and stagnant wages, most families spend more on food, fuel and shelter than they take in. AKA The working poor.

Food for thought. How many in the tea party do you suppose make less than 30k a year?

Want to see GOP really explode- steer the argument away from taxes and onto the minimum wage.

Some random thoughts on gold, inflation, and the minimum wage.

The minimum wage was introduced in 1955. From 1955 to 1970 a worker earning the minimum could purchase between 40 to 100 gold oz depending on the year.

In 2011, a current minimum wage earner spending their entire gross paycheck- could purchase only 7 gold oz.

I posit that an increase in minimum wage coupled with low inflation is the magic formula to maintain a healthy wealth distribution.

Year- Minimum wage converted to gold

1955- 44 Gold oz

1970- 92 Gold oz

1980- 10 Gold oz

1990- 20 Gold oz

2000- 40 Gold oz

2011- 7 Gold oz

Take note of the 1970’s boom to the bust of the 1980’s. Notice the perceptions drop a minimum wage worker could purchase in gold.

It took the economic boom of the 1990’s to finally see an increase in the purchasing power of minimum wage workers on a par to the 1955 /1970 era.

So many things amount to noise and distraction; I like to look at a few prices to prove my point.

Simply put, the price of gas has doubled since 2000, salaries have not kept us. Official CPI masks the true damage inflation has inflicted upon the populace.

While corporate profits are up for many reasons, two of them are: they pay workers less in inflation adjusted dollars than ever before, and they are able to pass thru inflation costs to consumers who are paid less than the rate of inflation would dictate.

Consumers have had to use the credit card to purchase food, fuel and tires.

Of course some consumers were reckless with credit, but most used credit to pay for the basic necessities.

For the poor and middle class to live off a weak dollar they have had to leverage themselves up to the hilt.

GOP / tea party / conservative and right leaning blogs abhor the minimum wage and will not honestly discuss it in any way- except to say that it is an evil government regulation inflicted upon the “job creators”.

While the picture is bleak- I still think we can get out of this hole.

apmex

The most honest stock broker you will ever meet.

Netflix was the play!

I’m so frustrated I didn’t get a piece of that action; I was so engrossed in playing Europe that I let Netflix slip right by my fingers.

The way to play high flyers with a lot of chatter (as Netflix has had) it to purchase way out of the money puts for a few cents.
Always purchase near-term puts so that they are cheaper, you have better odds of hitting a jackpot this way and it’s cheaper than playing the lotto.

Just three days ago you could have purchased the weekly 170 put for one cent- today its worth 10 dollars! If you had purchased 10 of these puts for 10 dollars, they would be worth 10 grand today.
As I mentioned earlier, I am a big fan of purchasing weekly puts on high flyers every so often; the payout beats anything else you could cook up with minimal risk.

All it takes for a high flyer is one slipup, one tiny mistake and it will lose 30% to 50% of its market cap almost in one day- huge money makers if you long way OTM puts!

Netflix isn't a buy just yet. The shorts aren't done having their fun yet. At some point it will be a good play for the upturn, but that time isn't just yet. The increased monthly fees are going to start rolling into the bottom line in a big way.


What’s the next Netflix you ask? Apple! Bears are chopping at the bit to take a bite out of that juicy market cap. Without Jobs at the helm they have a huge catalyst, one miss, one screw-up, one gaff and it will go down HARD!

One day, Apple will screw-up, you want to be long cheap puts when that happens.

One final note.
Buying weekly OTM puts on high flier is also a cheap way to hedge your portfolio against huge market corrections.

I'm long Germany.

The German DAX is down 30% this year and almost down 40% from its all-time high.

Here is how i am playing it:
I'm short the EURO which could be considered long the US dollar.
I'm Long the German ETF and some other European ETF's. I'm long OTM puts on the European exchanges.

Ordinary citizens in the Euro zone shroud be buying dollars hand over fist just in case the Euro collapses. They either need to be long the US dollar or gold in order to protect their savings accounts and assets, and they need to do it now.

Tickers:
EWG ISHARES MSCI GERMANY INDEX
DRR MORGAN STANLEY SHRT EUR

Time to buy the dollar?

Tough to say, but its a good hedge against gold and the Euro.

Don't sell your inverse gold ETF just yet.
Holders of the Euro need to get out of that currency ASAP- where are they going to go?
Gold, Dollars and Treasuries.

Citizens in the Euro zone with savings denominated in Euro's have to be looking at buying dollars or gold just in case the Euro crashes the buying power of their cash holdings.

Caution!

Bernanke isn't going to save us tomorrow. I thought it was a bit unfair to pin the rally this week on what he has say tomorrow.

Steve Jobs, i never owned Apple stock, and i don't own many Apple products but i will miss the man. America will miss the man, if he doesn't represent capitalism i don't know who does.

Here is my current portfolio.

50% cash, 15% short, 5% commodities.

Buy some cheap Apple puts. Apple is finding support right now, but the market will look for any excuse to hit it hard. If Bernanke disappoints tomorrow, look for the market to take it out on Apple.

Either short Apple through puts or through some inverse technology ETF's.

Take a look at TYP.

Ways to make cash at home right now.

Here are some ways you can either make, or save some money.

First we have Bitcoin.

What are Bitcoins?
Bitcoins are one of the first attempts to create a decentralized real-world currency with no governments, no central banks, and no rules.

If you generate bitcoins you can sell them or trade them for goods and services. Bitcoin is an ingenious way to create a virtual currency that is used for sale and barter.
It is an electronic international currency that is gaining in popularity every day.

The way it works is you use your PC to generate bitcoins, it uses computer horsepower to generate a virtual coin that others will buy from you. It's ingenious in its simplicity and a unique way to make some cash on the side.

go here for more info.
http://www.bitcoin.org/

Next:
If you spend over 1500 on groceries every year (who doesn't!) you can get 6% cash back at the grocery store using Blue Cash from AMERICAN EXPRESS.
http://bluecashcards.americanexpress.com/home/#/

There is a 75 annual fee, but its worth it if you spend 1500 a year in groceries. Most families spend thousands a year with food inflation being what it is.

The Blue Cash Preferred Credit Card - American Express, apply today.
This card can help you stay on budget with grocery shopping.











Last, here is an ingenious way to hedge inflation. Most investors know about TIP's to hedge against inflation but this doesn't include oil and food inflation. To do that you can actually invest in commodities ETF's in order to lock in your price of food and gas at a certain price point.

Take a look at UGA for gasoline, and DBA as a hedge for food inflation.
There are a few ways to play these. You can total your costs for the year and buy options or the ETF itself for a years worth of food and fuel. You could go out furhter by purchasing two or three years of costs as well.

I don't know if now is the time to put this hedge on, of course (if) when gas at the pump drops to the 2 dollar a gallon range that might be an ideal time to purchase a few years worth of fuel at the time at that price. If gasoline does go down after you do put this hedge on, it should cause too much of a concern. How long do you believe it will stay down before it rises again?
Just remember this isn't like a traditional investment, it’s a hedge tied directly to your expenses.
That means you shouldn’t worry (too much) if it goes down because you will save that same amount as you go to the pump, and if it rises you may not want to sell it for a quick gain as it may rise even more in coming years.

These aren’t get rich quick investment- they are just a few ways to save some money.

Quick recap.

Markets slipped almost 20% at their worst yesterday. Interesting that they bounced back today, 20% is usually the metric which defines a bear market. I guess we can all collectively catch our breaths, it isn't officially a bear market because we rallied 1% off the lows. Are you buying it. good, neither am i.

Bought another 10% yesterday and sold 30% of what is left of my short position.

My long short portfolio survived with a decent gain. Because of triple short ETF's and out of the money puts that went into the money to hedge my larger short positions.

As far as today goes, I'm not so sure we have seen the bottom or capitulation; I haven't bought anything today except some puts.

I did go ETF shopping yesterday, one of my favorite things to do on market plunges is to purchase big yield at panicked prices.

As i mentioned earlier, one of the best moves you can make is to re-balance when the market crashes. Sell your losers and trade up to better stocks that have fallen in line with the general market.

My current portfolio consists of 60% in cash, and 10% remains short.

I'm not ready to go all in yet, you shouldn't either.

Chicken little!

Time to go long, that's right LONG.

If you are following my moves, you should either be 100% in cash, or in a 70/30 long short position. Time to sell some more shorts, not all, but time to go long on some ETF's.

At the moment I like commodities, but i don't want to play them straight. Instead, i going long on (UYM) its been hammered in the last week. Its largest holding is FREEPORT-MCMORAN. I've also gone long on (FAS) Daily Financial Bull 3x Shares. This fund is down 20% in the last few days.

UYM- ProShares (200%) the daily performance of the Dow Jones U.S. Basic Materials Index.

Just a friendly reminder- ONLY reinvest 20;. Sell another 20% of your short positions as well. Keep some inverse ETF's on the table and some short term puts on the averages just in case fear really overtakes the market.

Rebalance when the market sinks.

One silver lining in a crap market is when everything is on sale; you can swap your underperformers for better quality stocks that have fallen with the markets.

One big mistake most make is they become paralyzed by fear- don’t be. Trading that stinker in for something new when everything is down is one of the best moves you can make in a bad bear market.

If you own a retail stock that just reported poorly and you took the pain in a bull market, trade it out and buy a retail ETF that has crashed with the market in general.

Some of the best moves I ever did was selling individual stocks and exchanging them for ETF’s in the same sector when the markets tank. With the ETF’s you get built in diversification to a basket of stocks. If that isn’t enough, some ETF’s distribute dividends; this is a nice bonus if the stock you sold for the ETF doesn’t.

Sold some of my short ETF positions today.

This market won't go straight down, so it's a good move to take something off of the table. If you hedge with puts and levered inverse ETF's definitely sell some when you get a day like this- these instruments do very well with high volatility but if the market decides to rally they will get crushed. If you purchased puts that expire in less than 30 days its a good idea to roll them up and out to an expiration further in the future. For example if you had the DIA 118 put (expires in 18 days) you may want to sell it for 2.30 and roll it to a DIA 100 strike that expires in 46 for .30 cents. This accomplishes a few things, you cash out a nice amount of change and you still have some protection for a much long time period. Remember the DIA 100 put doesn't need to go in the money for it to rise substantially in value.

There was one thing holding the Market in place last week, the prospect (hope) of a good deal getting done, instead, we got bupkis. In truth, there really wasn't a good deal to be had, there was no mention on jobs nor stimulus, all we learned was that things were worse off than we imagined, and that message above all others was the one we all took from Washington.

What not? Sell some shorts, but don't sell them all. I wouldn't go all in this market, but if you must go long, try to do it incrementally. Selling a put to enter a position while volatility is a decent strategy, but i would make it a vertical put spread- that means go long an OTM put (one transaction) just in case that stock continues to tank.

If you’re long this market- why?

What are the upside catalysts?

Maybe the better question is: what are the catalysts to the downside?

These new cuts will guarantee government layoffs and that was one of the few bright spots for jobs.

While the government sheds jobs and programs unemployment benefits wind down as well. This one, two punch will affect consumer spending, it can only go down.

Maybe even worse is that overall consumer sentiment is shot, the pessimism is so thick in the nation, it is palpable. Consumer spending is going to go into the toilet.

One could argue we needed more stimulus and an extension of benefits for those out of work, in order to increase tax revenues, you need to spend money to make money, and that is the most frustrating aspect of the entire debate. While all of this is going on we can’t forget about the mess in the euro zone and the potential for a credit downgrade in the US.

Market optimists will say that it’s all baked in, that the debt ceiling debate is over, and that this plan is better than no plan. I disagree on all of these points, I see huge downside and minimum upside- is anyone expecting the DOW to reach all time highs in this environment?

With all that said; I see one positive, just one.

Inflation adjusted, the indices are in the toilet and they haven’t moved in ten years. DOW 11k today and DOW 11k in 2000 is not equivalent if you look at the price of oil, gold, or almost any other commodity in that same 11 year span, for Pete's sake, look at what the dollar was worth in 2000 compared to today!

President Milquetoast or Milhouse if you prefer.

President Obama and the great compromise.

If this doesn't say it all- what does?

This man is a disaster in so many ways that it defies comprehension.

I hate HATE to diss and dismiss the democratic preisdent of the United States but i've run out of excuses.

The markets will continue to tank, and i don't see what will get this funk that envelops the nation to fade away.

Did anyone happen to catch "Meet the press" yesterday July 31st?

They eviscerated the president. Even though they are supposed to be bipartisan and neutral, there was a severe beat-down of Obama on all things and no one there to defend him at all.

Gregory poured gas on the fire. Is Gregory he a right winger? To top it off Tom Brokaw, Tom freaking Brokaw was totally spewing tea party talking points!

As McCain said- This is bizarro world.

If you must stay in this market you need to create a long / short portfolio.

If you think you are diversified because you own foreign stock, foreign currencies, bonds or treasuries- you absolutely are not!

If you are on margin lower that amount, if you can’t, you NEED to use a good percentage of that margin on short ETF funds and puts.

Make sure you have at least 30% of you margin account in a defensive position.

Short ETF funds that go up in value as the market crashes are going to be the only thing that is going to keep you account from getting debilitating margin calls that can decimate your trading account and your finances.

Puts on the averages or on some of your specific stocks are a must as well, but I prefer to have inverse ETF funds as they don’t expire. In good times, as your portfolio increases you should add funds to your short ETF.

Leveraged inverse ETF funds can be lifesavers but the problem is they suffer from slippage in fast moving markets that go up and down on a daily basis.

A simple solution for this has been selling calls on a portion of these funds when they gain large returns might be the way to go. I don’t recommend using calls in a bull market on these inverse ETF’s as you don’t want to be negate your insurance policy on your margin.

How I am playing this market.

How many times have you heard you need to hedge, hedge, hedge?

Here is how I am doing it:

I bought FXA as a play on Australian currency, interest rates, and as a roundabout way to play commodities.

PFF as a way to get broad exposure to preferred stocks, this will undoubtedly lose value in a down economy but its pays a monthly dividend so that will cushion the blow somewhat.

FAZ 3x levered financial short, be careful with this one as it suffers from major decay thanks to the leverage instruments that need to be rebalanced on a daily basis.

I’ve also stocked up on weekly options on FAZ, Call me crazy but I need even more leverage than this speed bullet provides so I going for out of the money calls and puts, any dramatic move in either direction and this Out of the money strangle can make some serious money.

TVIX is a levered ETF that tracks the VIX and it goes up in value as the VIX index does. I also have a strangle consisting of OTM options on the VIX.

TBT is a 2x inverse 20+ Year U.S. Treasury Bond ETF. Play it with a strangle.

P.S.

Anyone know of any leveraged ETF’s that provide weekly options aside from FAS, and FAZ?

The markets won't crash until we get a deal.

They aren't going to crash before we get the debt ceiling raised.

The debt ceiling and the cuts to spending won't induce a rally, they will do the opposite. Nothing on the table is going to help GDP or jobs, there is zero stimulus and even worse there will be job cuts to government sector jobs.

We are going to get job loss out of this and decreased benefits to disabled elderly, and poor citizens, in other words Americans that could barely get by before might be pushed over the edge in this "new deal" which is cutting the old deal which served as a safty net for those that needed it most.

There is no hope, no positive change rather all that government has done is display to the world the malaise and the untenable situation they have created and refuse to fix.

Government needs to spend money to make money, stimulus, public works to build and repair infrastructure, alternative energy projects, instead we are going to cut funds to all sectors of the economy when we need to grow instead of contract.

Unless and until we begin to fairly tax the rich we won't be able to start to rebuild this economy. I am not the only one that has figured this out, because of this despair that can be bu with a knife I've moved into cash, I've also purchased a few short-term market investments that are going to make money if the markets tank.

This market is as bipolar as a bachmann.

A lot of market players are wondering why the market hasn't tanked yet. The answer is simple.

Volume has dried to a trickle and the small players that are trying to make some money are on the short side. It doesn't take much of a brain to realize we are in dire straights.

We can't go down in one fell swoop when the market has told the world its supposed to go down in advance.

That's not how the big boys play, they need an unexpected black swan or a flash crash that catches most by surprise.

There is money to be made when the market moves down 150 points down and then climbs back 100 points in no time at all. unfortunately unless you are a high frequency trading bot i don't know how joe and jane retail can take advantage of the wild swings.

Take a look at the faz 50 call that expires today- the low of the day was 8 cents and the high was .77 cents. the catch?

you literally had only a few minutes to sell it for a profit before the markets reversed.

Lies, lies and scum.

Lets begin with the most egregious fox / right wing lies.

Fox news talking points:

Entitlements are bankrupting the economy; too many people are receiving government checks.

Facts:

Americans have paid into social security all of their lives- once they retire that money is given back, think of it as a fixed annuity. If you die early with no dependents that money that you paid in remains in the system. Its our money, it isn't a freebie in any way. Kept in mind when we pay into social security it is paid into the system with a more powerful dollar, when we finally retire and get it back its in inflated (worthless) dollars.

Fox news talking points:

The rich pay 50% of all taxes, the poor pay nothing.

Facts:

While it is technically true that the rich pay 50% of the federal tax, it is a misnomer to suggest that the poor pay no tax. The poor pay a higher percentage of their salaries to taxes than the rich do under the current tax laws.

The poor pay sales tax, city tax, state tax, an oil tax, and the inflation tax.

While the rich own more of the country than they have since the days of the robber barons. the poor and middle class are one cent away from living on the street.

25 hedge fund managers made one billion each last year- they paid 15% capital gains tax on that. 150m sounds like a lot but they have plenty left over to buy that villa in Tuscany, and that flat in London. Just fifteen years ago they would have paid 280million and still had enough for the flat and the villa.

Last year almost 30% of the country made less than 30 grand. Once they pay for the above mentioned taxes, they still (barely) have enough money to pay for food, rent, and a pair of shoes for their feet.

Tell me who pays the higher tax.

Alright, lets make some money.

Volatility is going to peak next week.

We won't see a debt ceiling deal till Sunday or Monday. After its all said and done, i wouldn't expect a relief rally as this entire debacle has just underscored how screwed we really are. Piss poor government with no clue how to make things better, most of us are just praying they won't make it worse. If i had to bet, i would say there is a better likelihood we go lower after we get a deal, instead of higher.

In this market, i am playing a lot of straddles just hoping for volatility in either direction. I've sold most of my positions and i am just waiting on the sidelines with a bunch of options.

I'm also using leveraged ETF's but these funds get hammered in this type of up one day and down the next market routine.

Can an investor be a capitalist and a socialist at the same time?

Absolutely!

More importantly, a human being can make a profit and also support social programs that help the less fortunate.

This blog will chart my investing activity, and explore the dysfunctional government that is killing the poor and middle class.

Let’s get one thing straight. A liberal progressive doesn’t have to support Obama. He has been a disappointment to most Dems because he hasn’t gone far enough to the left.

As the nation has moved further to the right, the centrists have moved to the right as well, mainstream democrats resemble republicans of the last decade.

This needs to be said: I personally agree with more socialist viewpoints, but the Republican party can be a good party with a few great ideas. All things being equal i would prefer capitalism over socialism. Better to give someone a job with a fair wage in a company that produces a profit, rather than give them a hand out. My gripe is with an extreme conservative ideology that espouses profits over everything including basic human dignity that social nets provide.

In part i blame Fox news (all newscorp papers) and most blogger market conservatives for extreme right wing viewpoints being talked about in the mainstream as a solution for middle class Americans. In reality, extreme right wing viewpoints are espoused as a political ideology, in reality they are just an excuse for greed, avarice and a lack of compassion for their fellow human-beings. Most right wing zealots seem to have zero sympathy for the downtrodden- all they seem able to do is spew mindless dribble (talking points) about entitlements, taxes and social program's.