Hot Tips

  • September 18, 2020

    1. The Value Rotation is On,

      with large scale selling of technology stocks and the chasing of banks and other recovery plays. It’s been a long time coming and could well persist until the end of the year. The option expiration at the close today is exacerbating all moves, which is why I dumped my last two tech positions days ago. It’s too early to buy tech again on dips. Wait for a pre-election meltdown.

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    2. Copper Hits New Four-Year High,

      as traders bet on an accelerating recovery in the global economy. My favorite, Freeport McMoRan, the world’s largest copper producer and a long time Mad Hedge subscriber, is soaring, up 257% from the market lows. China, which is done with the Coronavirus and whose economy is recovering rapidly, has returned as a major buyer of the red metal. Keep buying (FCX) on dips.

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    3. US Consumer Sentiment Hits Six-Month High,

      up from a 75 estimate to 78.9. The University of Michigan report is proof that those who have money are spending it. Another green shoot. Didn’t help stocks today though.

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    4. Delta Tapping Frequent Flier Miles for Financing,

      collateralizing them to raise $9 billion in debt. They’re really down to searching for change under the sofa cushions to stay in business. It’s one of the most unusual types of financing I’ve ever heard of, topping David Bowie’s future music royalties. They’ll not come close to match bonuses they paid to their CEOs over the past decade.

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    5. Election Chaos is Starting to Price In,

      with the US dollar (UUP) getting an undeserved bid in a flight to safety trade and stock down 1,000 points from the week’s high. All sorts of Armageddon scenarios are making the rounds now and traders are pulling out of the market to protect hard-earned profits. For details, watch the final season of House of Cards, where martial law is declared in Ohio to reverse an election outcome. No kidding!

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  • September 17, 2020

    1. Fed Says No Interest Rate Hike Until 2023

      and promises to heat up the economy even more than previously. The long-term average 2% inflation target I reaffirmed. Jay sees a net shrinkage of the US GDP this year at 3.7%. The Fed put lives! Buy stocks on dips.

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    2. Snowflake Sizzles,

      with its highly sought-after IPO more than doubling on its first trading day. Its entire market cap traded in an hour and a half. It seems there is a severe shortage of high growth large-cap technology companies. Yikes! We have another Tesla to trade. Warren Buffet doubled his money on day one. The Oracle of Omaha still has his old flair. It seems he has more pull for hot allocations than I do.

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    3. ChargePoint to Go Public this Year.

      Anyone with an electric car already knows who this company is. They are a national network of charging station and is an amalgamation of four smaller such companies. Try to get some from your broker. It will be hot.  

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    4. Boeing Gets Trashed Again,

      with a scathing House report assaulting the company and its regulator, the FAA. Don’t touch the stock until we revisit $120 on the next meltdown.

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    5. Morgan Stanley Says the Trading Boom Won’t Last Forever,

       says my former employer coming off of a record quarter. Too much of a good thing won’t last forever. Make hay while the sun shines.

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  • September 16, 2020

    1. Today is Fed Day,

      and you can expect the all-important interest rate decision at 2:00 PM EST. Likely they’ll do nothing until 2023! This is a case where the press conference will be more important than the headline.

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    2. Snowflake Prices Rich,

      at $120 a share, valuing the California-based cloud storage company at an eye-popping $33.3 billion. That is 30X sales! Tech is still overheating; they’re just looking for new names. It’s one of the highest valuations ever for a software IPO. Even Warren Buffet bought in, the first time he joined an IPO since 1957.

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    3. Judy Shelton Fails to Get Her Fed Seat.

      Senate confirmation is out of reach. Her preference for a return to the gold standard shot down her chances. Not enough US states produce gold. It’s not a time for archaic, conspiracy-based monetary theories.

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    4. Amazon is Building its Fleet,

      rapidly catching up with FedEx and UPS in aircraft. Planes have become essential for guaranteed one-day delivery. It has added 20 new planes this year to bring their fleet to 70. Good for (AMZN) that are a lot of cheap aircraft for sales these days.

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    5. Bill Gates Sr. Dies,

      an old friend, fellow Scoutmaster, and father to the richest man in the world. Bill made it to 94, no doubt a result of all that hiking with the Boy Scouts. He gave me the best advice ever for raising kids. Bill spent the latter part of his life managing the Bill and Melinda Gates Foundation. For my last interview with him, click here.

  • September 15, 2020

    1. Citigroup Announces Surprise $900 Million Loss.

      I can’t wait for the excuse for this surprise, out of the blue “operational error.” It’s most likely an expensive hack. It’s the kind of black swan that can hit you any time if you are a short-term trader. Long term investors should be buying the dip in (C).

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    2. China’s Retail Sales Rise for the First Time in 2020,

      up 0.5% in August. First into the pandemic, first out. Keeping Corona deaths to 4,000 was also a big help. It’s proof that economies CAN recover post-COVID-19. Buy China on dips (BABA), (BIDU). Stocks there will enjoy a huge post-election rally once the trade war winds down.

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    3. Bill Gross Sees no Good Trades,

      vaccine or not, as fading stimulus drags on the economy. Defense is the way to go. The legendary former head of bond giant PIMCO is buying value plays like banks, foreign stocks, and yuk, tobacco stocks. Hey, anything for a buck.

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    4. Jamie Diamond Says Recovery to Derail With No Further Stimulus.

      He should know as the chairman of JP Morgan Chase (JPM), Unfortunately, 2021 will be the earliest that we can get such help due to Washington Gridlock. Last week’s stock market lows will be tested.

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    5. Oil Collapses 15%,

      on the dimming outlook for the global economy. Not even massive well shutdowns caused by this week’s hurricane could boost prices. Avoid all energy plays like the plague.

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  • September 14, 2020

    1. Fed Meeting Starts Tomorrow,

      and don’t expect any interest rate move to happen. Since governor Jay Powell promised to run the economy hot weeks ago, ten-year US treasury bonds have only eked out a paltry rise to 72 basis points. The market isn’t buying it. It’s tough to beat the ever hyper-accelerating technology that crushes prices. Still, I’ll keep selling short bond rallies because it’s just a matter of time before the government crushes the market with massive over-issuance. Sell every rally in the (TLT).

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    2. The Biggest Chip Deal in History,

       is forced by Softbank’s distressed asset sale. It sold Arm Holdings, a UK-based chip designer, for $40 billion to NVIDIA. Concentration of the industry continues. Only antitrust concerns could block the deal. Softbank stock soared 9% on the news. Buy (NVDA) on dips.

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    3. Oracle Grabs TikTok,

      in a fire sale forced by the trade war with China. How long until China forces a deep discount sale of Apple’s China operations on national security concerns? Tik Tok could turn into a tit for tat.

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    4. Want to Find the Covid-19 Hot Spot Near You?

      Just google “loss of appetite”, “loss of taste,” or “diarrhea” and MIT researchers will find you through your IP address. What else do you have to google for people to find you? Don’t ask.

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    5. The Aircraft Secondhand Parts Business is Booming,

      as older aircraft grounded by our Great Depression get recycled. Most are sold to third world airlines, which are not subject to FAA safety standards.  It’s another example of American business turning lemons into lemonade.

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