April 25, 2012 Call Me Anytime

BAGAKOAA; 25 April 2012 Call Me Anytime

Post 636

CLICK HERE To See Past Posts

April/2012

I was just getting ready to fix dinner last night. I had thawed a couple of cute little filets and some potatoes a gratin. I was going to have a nice salad to go along with that as well. But NO, The Queen had announced she had had enough! So we were going out to dinner. She prettied up, something she is really good at, and we had a great meal at Hanna's.

Earlier in the day, I took her for her Dr's appointment to have her stitches out. Then we enjoyed breakfast. I got her home and took care of the dogs and some other personal stuff. I then cleaned up some e-mails and few work things from the house. I also did some stock stuff we will tell you more about later.

Then there was this 1:00 meeting I had to take. It was a networking opportunity for a friend of a friend. I am sharing his resume for anyone interested. He has a strong back ground in digital media marketing.

After that, Devin was still alone and I closed shop so I could take care of things at home so she could rest. Well, most of you know Devin. She has a whole line of apparel that says, "I will rest when I am dead."

After checking on her a few minutes she jumped up from bed. I asked "Where are you going?" She growled, "I don't know.", and wobbled away to her closet. A few minutes later, she was in the doorway to the bathroom wearing a new dress. She looked fantastic and I immediately knew this must have been one of the things she warned me about. She said in her boredom she had been ordering things on line. Well right now it was fashion show time. She looked really nice in all three dresses. It was shortly after that, when she announced we were going to dinner.

Now this time with Devin recuperating, has been very enlightening as despite my best efforts, she still can find shortfalls in my performance as a care giver and supporter. Most of the questions start with the words, "Did you remember to . . . . . ?" Well I have discovered if I say yes, she just keeps going until she finds one I have forgotten. So now, when she asks from the Royal Bed, "Did you remember to feed the dogs?" Instead of saying yes, I say no and leave the room. It works great. I get to escape downstairs and watch something I WANT TO WATCH and she thinks I am doing something she wants me to do. Genius, I know. Then I come back to the room twenty or thirty minutes later and she says, "Did you remember to bring in the trash cans?" I get up and go down the hallway and crunch a few more stocks out on the Buffet Spreadsheet and she things I am bring in the trash cans (I actually had brought them in the night before.) This is working great. Occasionally she does actually ask me something I did not do, in which case I actually do a quick half assed job and then do something else I wanted to do.

I figured out that Devin's disenchantment with me has nothing to do with my performance, it is all in her expectations. I am working with her to lower her expectations so she is not always disappointed with me. It is a grand plan.

While I am doing my best to provide an exceptional level of care during her convalescence, there have been a couple of ooopps moments worth sharing. Her first day recovering, I was helping her up the stairs. I chose to carry the crutches while helping her. On the turn in the stairs, I somehow clipped the side of her head with the crutches. No, really it was an accident, really. She ended up with a small black eye. The spot didn't even fill her eyelid. Actually it looked a lot like an age spot more than a black eye if that is any consolation. Then yesterday as we were getting in and out of the car, I had to get her crutches out of the back of the Escalade (Yes I name dropped because you need to know the doors on the Escaladed are big and heavy. I am not so pretentious that I need to remind you we have a Cadillac Escalade, or a BMW 650i, or an F250, or a Ford Expedition (a 1996 origional). In getting her crutches, she was standing right where the door opened and WHACK, I hit her with the door on the hip and she almost fell in the parking lot. I busted up laughing. She did not find it amusing, but it was a hoot.

Today she had physical therapy and was learning how to walk while not relying on her crutches. I am ashamed to say, she has got more done around the house this afternoon than I did in four days. I'm telling you its all about the expectations.

Speaking of expectations, let see what happened in the market.

What A Lovely Bunch of Apples

Last week we reported that VZ, Verizon's earning call made a mention about their (Verizon's) sales expectations of iPhones were not met in the first quarter. We suggested that MIGHT be a tell as to AAPL earnings last night.

While running around with my lovely gimp along, one of our readers and Salve Lucrum family members called to ask if they had stopped out of AAPL as they had set a stop at $565. They had and I would like to acknowledge they did a great job on their holding and their position. They cleared a 59% annualized return on their holding. Way to go! Now that was in their joint account, one I do not trade in, but have trading rights. I only trade in that account after asking them. They have another account that I am the active trader for. Anyway they not only asked me to check if they stopped out, but they wanted me to get more shares at the sub 565 level. (Our stops were set at a support level of $550.) I listened to their request and said I would, but was concerned because if the "TELL" from Verizon was correct, and the quarter was bad, we could easily break the support level at $550 and we could see it fall another 5-7% from there.

I went into homework mode and checked the cell phone sector using press releases from VZ, T, China Unicom, China Telelcom and several chip makers BDCM, AMD, ARMH and no one was echoing the concerns of VZ. (AT&T did mention a little softness, but they had lost the exclusive deal with AAPL so that was to be expected.) Then I checked the iPad sector and the music download sector. Everything I read suggested a blowout quarter. I decided to write off the 7% drop last week to casino managers doing some profit taking on the back of the possible bad news out of VZ.

I then made a risky bet. I bought some $555 call options that expire this Friday for $19.40 a call right before the close. AAPL closed at 560 ish. They reported after the close and as you all know they did have a blow out quarter. By 5:00 EST the stock was trading after hours at $602ish. We awoke this morning and got everything ready to make one of the best trades in our trading career. The calls opened at $59.70. we rang the bell for a 300% gain. Now that deal and the fact I made it all the way from my office to Subway sandwiches (3 miles away) without stopping for a red light told me I had to play lotto tonight.

So besides AAPL having a great day today, let's look at what else happened. Mr. Market seemed to be doing the happy dance right off the bat with the great report from AAPL. Then BAC Boeing had a nice report as well. Caterpillar did not fair so well, but with the cooling in China that was built into the market and the price of CAT. The Fed spent most of the day saying nothing. Somehow the Gold market took some of Bernanke's comments as hope for QE III and the shiny stuff came up a bit. I heard most of his comments tonight and I do not see why they thought we were going to get QE III. The market cooled from its 3 digit high on soft durable goods order and mortgage apps(we called those Sunday night. When you back out refis the mortgage app rate was not pretty.) There was moderate volume today so we will still be in a market correction. RED FLAG.

Ch Ch Ch China

There was a lot of talk today about China's driving the numbers of AAPL. True the iPhone 3 and 4s has flattened out a bit here in the states, but is exploding in China. There are some great sectors in China to watch right now, but materials and commodities are not the ones. Today on Bloomberg, Adam Scott did a great job explaining the consumer explosion in China. Household income in China has grown four fold in the last 15 years. That creates a lot of expansion in the consumer sector and those US companies serving them. Here are few that Adam mentioned and may be worth another look.

In 2009 AOS a manufactures of home appliances like water heaters got 16% of its revenue from China and now gets 22%.

CRUS Cirrus Logic, chip makers for consumer electronic products used to see 22% of its revenue from China and now gets 56% from there. GLW Corning got 12% and now gets 20%, yes the Chinese like those big screen LED Televisions. MJN, Meade Johnson got 15% has doubled that in the last two years to 30%. MPWR, Monolithic Power, makes of portable media digital and analog chips has seen its revenue run from 40% to 58% from China. MYD Mettler Toledo, maker of Medical devices had 13% of its top line origination out of China in 2009 and now sees 17% from there. QCOM, Qualcomm number has gone from 23 to 32%, and YUM has seen their revenue drive from China increase from 34% to 44%. They will be opening a NEW KFC outlet in China every day this year. The point is, AAPL is not the only way to invest in China. To follow Adam, he is at @ajinsight in Twitterland.

Extra Extra Read all about it. IBD has new stuff. I got my IBD today and I could not find the Big Picture Column. It was gone. Then I noticed more color on the pages. They even had red for down days on most of their charts. Then I remembered, today was the day they were rolling out the changes to the paper (and of course the eVersion.) I must say it is great.

Here are the highlights:

The Wednesday edition will showcase a special new column "How To Find & Own America's Greatest Opportunities" by IBD's Founder and Chairman. The column will cover some of the biggest stock winners of all time and what made them soar in price. The point is to help you recognize the winners of today and handle them the right way to maximize profits.

IBD's popular market analysis and coverage of leading stocks will be moving to the Markets page. Now you'll have key market analysis (The Big Picture, and big charts of the Nasdaq, S&P 500, NYSE, and IBD's Mutual Fund Index) all in one place to make it easier than ever to get a read on the strength of the market.

The New High List Analysis will examine stocks making 52-week highs each day, focusing on top-rated companies. This is a great new place to find leading stocks.

We've relocated the popular Stocks Just Out of Bases feature with two new lists, Stocks Pulling Back to the 10-Week Line and Sector Leaders. They'll all appear next to each other in Section B to make it simple for you to do a quick scan for potential winners.

I am so confident that you will like the new format of the IBD and you do not become a better trader, I will guarantee your subscription to IBD and the on line version. Just tell me you got it and after one month of reading and using some of the information and you don't feel more confident as an investor, I will give you your subscription price back.

I hear Devin asking me "Did you lock up?" I did, but I will sign off now and pretend to lock up even though I already did. Have a great night.

Salve Lucrum

Since 4/5/2012

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.

2012 Year Ending

Dow 13,073

S&P 500 1,358

Tool Box

Salvay And Lewcrum Explain