Today is options day
In the morning we see a few developments that are 100% consistent with what I've been saying.
PC sales slowing - Dell & HP sales rose only 5% YoY. If you want to get into the weeds, Dell has a unique challenge: they spent years mastering outsourcing PC manufacturing & inventory management as well as squeezing vendors. The problem is that their competitors today get to take advantage of the same pricing and manufacturing efficiencies.
HP had a different set of issues - too much overhead. They just needed a business person to begin the process of running the company effectively (Carly F was a terrible business person).
This slowdown is why I have avoided companies like NVDA, AAPL, and so on.
Retail is slowing. - Sears, Gap, Home Depot.
Housing slowdown is starting to take a bite - CPWM got hammered today. Down ~20%. If folks aren't interested in buying new knick knacks for the home, how interested are they in buying an expensive refrigerator that can connect to the internet?
I also think Bed Bath and Beyond must be hurting - they are sending out coupons on a weekly basis.
Oil - Actually, a massive surprise here. Down to $70. While not necessarily the end of a run, it is interesting. It was triggered mainly by higher oil inventories in the US and the Lebanon/Israel crisis being resolved. But we are now looking at Iranian sanctions. Oil exploration is and will continue to be a subject of investment. As will infrastructure. Saudi Arabia has 2,000 oil wells. Compare that to the US with 1 million wells. Exploration hasn't really begun. And Iran may end up breaking the impasse - updating their ancient infrastructure would be a massive gain.
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We will be buying in either late today or on mid-week next week. I think the last 10 days have been more a sign of relief (the Fed and interest rates) and a pullback from over-selling (the Israel/Lebanon war). I don't give it any more legs than that. I also think that as fear recedes regarding inflation, it will be replaced by fear over a slowdown.
I am not interested in investing in stocks that look good today but will sour as a slowdown begins to become pertinent. I want stocks with legs. And I think I have them
PC sales slowing - Dell & HP sales rose only 5% YoY. If you want to get into the weeds, Dell has a unique challenge: they spent years mastering outsourcing PC manufacturing & inventory management as well as squeezing vendors. The problem is that their competitors today get to take advantage of the same pricing and manufacturing efficiencies.
HP had a different set of issues - too much overhead. They just needed a business person to begin the process of running the company effectively (Carly F was a terrible business person).
This slowdown is why I have avoided companies like NVDA, AAPL, and so on.
Retail is slowing. - Sears, Gap, Home Depot.
Housing slowdown is starting to take a bite - CPWM got hammered today. Down ~20%. If folks aren't interested in buying new knick knacks for the home, how interested are they in buying an expensive refrigerator that can connect to the internet?
I also think Bed Bath and Beyond must be hurting - they are sending out coupons on a weekly basis.
Oil - Actually, a massive surprise here. Down to $70. While not necessarily the end of a run, it is interesting. It was triggered mainly by higher oil inventories in the US and the Lebanon/Israel crisis being resolved. But we are now looking at Iranian sanctions. Oil exploration is and will continue to be a subject of investment. As will infrastructure. Saudi Arabia has 2,000 oil wells. Compare that to the US with 1 million wells. Exploration hasn't really begun. And Iran may end up breaking the impasse - updating their ancient infrastructure would be a massive gain.
------------------------------------------
We will be buying in either late today or on mid-week next week. I think the last 10 days have been more a sign of relief (the Fed and interest rates) and a pullback from over-selling (the Israel/Lebanon war). I don't give it any more legs than that. I also think that as fear recedes regarding inflation, it will be replaced by fear over a slowdown.
I am not interested in investing in stocks that look good today but will sour as a slowdown begins to become pertinent. I want stocks with legs. And I think I have them
posted by Andrew at
9:34 AM
3 Comments:
The only pick that I think you are making money on is the JNPR puts. When are you going to sell them?
nope,you are wrong,he made lots of money on cpwm puts? isnt that right?
shorted 500 aapl at market close.
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