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Oooops is how we started the day. I got up took care of the dogs and woke up boy a little later than normal because he thought he had a late schedule today. Oooops. Devin took him to school and he left his lunch in her car Ooops. In the mean time I swam my laps and did my exercise. (BTW what up with stomachs and age 55. This gut of mine is expanding like the Stay Puft Marshmallow Man.
Fuuny how it happened after the age of 55 and two weeks before my daughter's wedding. But I digress.) Then I finally get to work and Devin comes to the office to review a draft of some of the readings we are doing at the wedding and we get a call from school.
Jack has never had a detention in his life. We get a call from school letting us know about a small issue during a religious test. There was some conversing between Jack and another student. After one warning, the test were taken away and he would receive detention. We received and nice call from the religion teacher and we will write it of to the Freshman learning curve.
Heck I thought detention was a subject when I went to school. (Not really. I was a good boring student, but I think my dad had a Master's in detention. But I digress again.)
Then I had a great business lunch with a couple of key employees at Hanna's. I really enjoy seeing people grow in an organization and we are blessed with some really incredible employees. During the lunch Devin called to tell me Man Child had called to throw himself on the mercy of the court. I love that kid. I would have waited till about age thirty seven to confess. Oooops he does read this occasionally. Love ya kiddo.
Due to a schedule conflict I had to head home a bit early to wait for a guy to fix our brand new washer and dryer. The good news is he showed up on time. When he was done and Devin had arrived home, we decided to get an early dinner at this great restaurant called Hanna's. Jessica took really good care of us and we saw some of the early crowd regulars (Hey Rudy, Lionel, Fred). As usual we had a great time. I had a simple pasta dish and water and Devin enjoyed a special salad with some beef. We picked up Jack and just finished helping with homework. Now the blog begins. |
That Horse Already Left The Barn
We were ready this morning. As we indicated last night, we knew the ugliness in Europe (and we are not talking about their teeth) was going to cause a rough opening, but it was miserable. By 6:15 the Dow Futures were down 200+ points. We checked the VIX and saw it spiking in the pre market. Those great ideas we had last night, well everybody had them to and many had pre market level II trading privileges. In other words, that horse had already left the barn. I had to do mea culpas to everyone I co-manage accounts for. By opening, the December 35 dollar call options were up 67%. Say La Vee aka c'est la vie.
If we stick with our puzzle metaphor, which I thought was rather cleaver, but I am a big fan of me, we had a piece of news that was supposed to be on the bottom of the puzzle, but ended up going to the top. The ISM Survey-Service Sector index came in at 53 and change not at the 51 mark. We had it pegged at 50 or even below. So we move that piece to the top of the puzzle, but because of all the other bad news it turned out to be a teeny tiny little straightedge at the top that will not help us figure out the puzzle this week. You know what I am talking about you find that piece you just know is the bottom edge and then you realize it is actually the top edge but you haven't got enough top edge pieces to make the top border. There you got it. (I hope you are liking this puzzle metaphor because if you don't this must be really annoying.)
But the good report did not help as it was ugly all day long till the last half hour when fund managers woke up and said, "Hey that was good survey number and UTX reiterated its balance of the year earnings and demand for oil is still vibrant and COST Costco had a great report last week and UPS has announced no decrease in deliveries and IBM is still buying companies and looking for growth (it in the clouds) and look at the good yields coming from a lot of decent companies.", and so we had a rally that only left us 100 points down. It could have been a lot worse.
We might not be done with this downturn so its important to keep an eye on some of the support points. The Dow has fallen through almost all of the traditional support points like the 200 day average (11,994) and the 50 day average (11,902) so it has not bottom left except the year low of 10,604. As you know we prefer the broader market measurement of the S&P 500 whose remaining support level is 1,119. These are important psychological and technical numbers to watch. | |
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Going or Not Going Postal
The US Postal Service lost another 5 Billion dollars. That may not be a surprise or you might not think it significant. Wrong. Here is why. There are rumors they are thinking about laying off 205,000 postal workers and stopping Saturday deliveries. In order to accomplish that task, congress will have to break about 7 union contracts. Now the dopey republicans will support that because it would be a huge blow to the Democrats and one guy who lives in nice big White House.
If the Postal Service does not act to end the bleeding, that in and of itself becomes a political cancer for the Democrats. It is a lose lose. Oh yeah rural America counts on Saturday delivery to get things like social security checks and medicine so this could be a lose, lose, lose for the Democrats. I am a firm believer that it will be difficult to get President Obama out of office, but this could be a big issue. Remember you heard it here first, unless if you heard it somewhere else first.
A Quick Pick Of The Day
We had a little action in the Salve Lucrum portfolios and a few of the account we co-manage. We increased GLD and SLV holdings when the commodities were down. We think the drop was due to some bullish sentiment about the dollar.
Anyway, we ran across a stock this weekend as a result of one of our readers and a golf buddy, Russ C. He was talking about a stock he has played and described as a classic channeling stock. This one happens to channel in the 6-12-6-12 range and almost looks a metronome. ASGN On Assignment, Inc., a diversified professional staffing firm, provides flexible and permanent staffing solutions in the United States, Europe, Canada, Australia, New Zealand, and Bermuda. It operates in four segments: Life Sciences, Healthcare, Physician, and IT and Engineering. It is closely tide to employment so as companies start to hire some day we have caught the stock at 6.60 a share making it really cheap (P/E is about 9). Fundamentals are sound and target prices are in the 13-15 range. There are very few analysts on this stock so it is below the radar. I want to ride this to the 12-13 range looking for a double, sell then buy some PUTs for the ride back down. (It could take 12 months to pull that off). If you didn't figure it out that was a truncated portion of my note to the account holders we try and make money with.
Salve Lucrum
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BAGAKOAA;
I am not a professional investment advisor. Anybody reading my blog and investing accordingly must be out of their minds. I have made more money than I have lost. There are many more qualified people than I to actually tell you how to invest your money.
BAGAKOAA=Boys And Girls And Kids Of All Ages
Salve Lucrum=Latin for Hurrah for Profit. |
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