I read the Prospectus this AM on QID.
It's still a nasdaq 100 short x2 but I do like the daily weighing...Did you jump outa SQQQ?
I think you end up ahead of the capital gains jumping out when you did..but yeah if you can jump in for the dividends do it.
Prospectus QID
https://www.proshares.com/media/prospectus/qid_summary_prospectus.pdf?param=1597410986303
It's still a nasdaq 100 short x2 but I do like the daily weighing...Did you jump outa SQQQ?
I think you end up ahead of the capital gains jumping out when you did..but yeah if you can jump in for the dividends do it.
Prospectus QID
https://www.proshares.com/media/prospectus/qid_summary_prospectus.pdf?param=1597410986303
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| Global Market Comments August 14, 2020 Fiat Lux Featured Trade: (AUGUST 12 BIWEEKLY STRATEGY WEBINAR Q&A), (GLD), (TLT), (TSLA), (AAPL), (FB), (AMZN), (VXX), (VIX), (JPM), (BAC), (GDX), (NUGT), (MRNA), (BRK/B), (SLV), (FCX) 
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August 12 Biweekly Strategy Webinar Q&A Below please find subscribers’ Q&A for the August 12 Mad Hedge Fund Trader Global Strategy Webinar broadcast from Lake Tahoe, NV with my guest and co-host Bill Davis of the Mad Day Trader. Keep those questions coming!Q: I just joined your service. Can you explain the logic to your current model trading portfolio? I always try to balance long positions with short position. That greatly mitigates the risk of an out-of-the-blue crash, like we saw in February. Also, every individual position has a long and short, further reducing volatility. And you never can lose more money than you put up, so your risk is defined. That’s another classic risk control measure. There is a further four hedge in that the portfolio is spread across all asset classes. So, I am long banks (JPM), (BAC), short US Treasury bonds (TLT), short a basket of big tech stocks (AAPL), (AMZN), (FB) and long gold (GLD). Something is always working where you can take profits. Our proprietary Mad Hedge Market Timing Index is always a big help in judging the best time to enter and exit these asset classes. That is the short course on hedge fund risk management 101. Q: Is it a good time to add in gold (GLD) here? A: Yes, my long-term target for gold is $3,000/oz, possibly higher—it’s very common once you get a breakout from a 7-year bottoming process to get a big move like that. You always go back and retest that breakout level, that’s what’s happening now. I would use this dip to buy gold. You can look at (GLD) itself, the (GDX) gold miners which will give you 4:1 leverage over gold, or any of the 2x or 3x gold leveraged ETFs like (NUGT). There are lots of ways to play gold this time left from over the last bull market in gold ten years ago. So yes, bullish on gold with a temporary pullback in store. This recovery trade, which is buying banks, casinos, hotels, restaurants, weak dollar, weak buy market, weak gold—this is all temporary, this is just a trade. Those will all reverse themselves, probably by September if not sooner. So, if you missed the first round in the gold bull market, there’s certainly another chance to get back in. Q: Do you think Biden and Harris will crash the stock market if elected? A: No, since Biden started to run away in the polls, the stock market basically went straight up every day, and I prefer the stock market’s judgment on these things to opinion polls or talking heads. As far as Harris is concerned, she was the most middle of the road conservative pick of the 12 or so people they were looking at for vice president. Certainly, she’s a favorite with Wall Street, and isn’t it interesting they’re looking for the talents of a prosecutor in the White House? Who do you think they have in mind? So yes, that’s a net positive for the market. If anything, a new administration will bring a whole new round of Quantitative Easing and deficit spending, except it will be focused on bailing out Main Street, not Wall Street. Q: Is the vaccine drug maker Moderna (MRNA) overbought here at 70? A: Yes, I think to get any more appreciation you need to get an actual result on the many vaccines that are out there. Q: Will Tesla (TSLA) pass 2,000 by year end? A: I tend not to think so; Tesla had a once-in-a-lifetime 10-fold increase over a year. That is a very big move to digest, and while I’m saying people should keep their Tesla longs for the long term, short term you want to be selling calls against your long positions to hedge any downside and to take in some extra income. Q: What caused ten-year US Treasury yields (TLT) to jump 14% yesterday? What will yields do from here? A: Yields will go up and retest the 95-basis point level we saw a couple of months ago. That means we’re going to have a clear shot at adding shorts, probably for the next several weeks or months. Q: I got the first TLT trade, but when I added the second one, I had to automatically close out my 175 short position to add the long 175 put position. A: That is the correct way to do this. And what you end up with is a wider spread with a much larger size. So, you take all three positions we currently have, and you now have a (TLT) August $170-177.5 bear put spread in triple the original size and triple the profit, which expires in 5 trading days. It’s a trade with a very high return over a very short time frame. It’s the kind of trade that’s only available with very high volatilities in the market—at $25 in the (VIX), and you get very high accelerated time decay going into the close. So, it really was a two-week expiration play on the (TLT). Q: Apple (AAPL) has been able to avoid any major damage in its share price in this trade war. How long can it last? A: It can last 3 more months, until the election. It’s really quite amazing that the Chinese have not retaliated against Apple in all of these trade wars, and the reason for this is that Apple employs a million people in China, and they make a ton of money out of it. Apple has also managed their relationship with the communist government perfectly. So, that’s why they haven’t been hit. General Motors, other US companies—they could get expropriated. If the US can expropriate TikTok, what’s to stop China from expropriating General Motors, Starbucks, or even Apple for that matter? Q: How do we know who has a real vaccine and who has a fake one? There’s so much information out there, I have a hard time filtering through what is real. A: Wait for 100,000 people to try it out first—that’s what my plan is. That will be the safe way to do it. And if that means quarantining another couple of months to make sure you get the real deal, it’s worth the investment. Most industry safety standards, like animal trials, have been ditched by the FDA in order to get Trump a vaccine before the election. Putin is doing the same in Russia. Q: Why is Warren Buffet buying back shares of Berkshire Hathaway (BRK/B) in record amounts? Is it because he sees no good investments? A: He’d rather buy his own shares at parity or at a small premium than pay record PE multiples for essentially anything else in the market. Because the government rushed in so quickly to support the stock market, there never were any real deals in stocks, they never really got cheap. Yes, it sounds like down 40% in 2 months is cheap, but stocks weren’t, not even close to cheap, on a PE multiple basis. We never got close to the 9 ½X we saw in 2009. Also, if you believe in a recovery play, the ultimate recovery play is Berkshire Hathaway because they own predominantly old-line industrial cash flow stocks, which will lead any real recovery in the economy. So, at this point, Berkshire Hathaway will probably get you a higher return on a 12-month view than say Apple, Facebook or Amazon. Q: Gold (GLD) vs Silver (SLV)? Which is better? And what about Copper (FCX)? A: Silver always outperforms gold by at least 2 to 1 in any real economic recovery. Copper prices have risen 30% in 4 months; that is discounting a real economic recovery someday, so I would be buying copper on dips also. Q: How do we learn more about options? A: I suggest you go to the “How to Trade” section on our website, and that has links. Every trade alert we send out also has a link to a video that tells you exactly how to do the options part of that trade. And if you don’t want to do options, we also propose ETF and single stocks. Q: What year end effect on the market do you see from a Biden tax plan on long term capital gains and qualified dividends at the ordinary income rate? A: Well, if he actually proposes that, there will be a rush to sell assets by the end of the current year so people can take advantage of the very favorable capital gains tax that exist now. However, it’s not known whether that is actually the tax increase he’s proposing; it’s more likely he’ll simply return to the pre-Trump tax rates. However, I do expect him to come up with highly punitive tax rates on any real estate-related investment as a way of getting back at Trump. And that’s like loss carry forwards, steps up in the cost basis, 1031 exchanges—things specific to the real estate industry. Q: If you think markets are going to come off, why aren’t you more aggressive buying the iPath Series B S&P 500 VIX Short Term Futures ETN (VXX)? A: (VXX) has become such a professional market it really has become a day trading vehicle. It’s hard to get customers in and out of this thing fast enough to make them money, as most of my followers are not set up to be day traders. It’s a market where 90% of the professionals are playing from the short side, so when you get moves up, they essentially happen over 1 or 2 days, and then they spend weeks or months bleeding off. It really is a tough trade for a retail trader to do; and it is an area where the insiders in Chicago trade this thing and really do have an in-house advantage that I would rather not try to bet against. Q: I sold the top on all precious metals positions and started buying back today. Was that the right thing to do? A: Yes, I have a feeling it is. Start scaling in—if you’re nervous about buying gold here, buy a third of a position now, a third if it’s higher or lower, and a third if it’s higher or lower again. That’s what any pro would do. Q: Do you see another big economic crisis in 2021? A: I don’t think so; I think any continued weakness will be hit with massive liquidity from the Fed and more government spending. Now that they found the model to keep the economy going, they’re going to just keep at it, no matter who is in power. Roosevelt kept at it for 5 years to end the Great Depression, until he was bailed out by WWII, so hopefully we don’t have to bail our economy out the same way with WWIII. Q: What about Bitcoin here? A: We don’t trade Bitcoin as we think the whole thing is a giant scam. There’s also no value added by anyone. Insiders have a huge advantage, the people who are creating the bitcoin to sell. So, it’s a security with no fundamentals—thus unanalyzable. Good Luck and Stay Healthy John Thomas CEO & Publisher The Diary of a Mad Hedge Fund Trader 
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Quote of the Day "When it comes down to data or anecdotes when making a management decision, the anecdotes are usually right," said Jeff Bezos, the founder of Amazon. 
|
| This is not a solicitation to buy or sell securities The Mad Hedge Fund Trader is not an Investment advisor For full disclosures click here at: http://www.madhedgefundtrader.com/disclosures The "Diary of a Mad Hedge Fund Trader"(TM) and the "Mad Hedge Fund Trader" (TM) are protected by the United States Patent and Trademark Office The "Diary of the Mad Hedge Fund Trader" (C) is protected by the United States Copyright Office Futures trading involves a high degree of risk and may not be suitable for everyone. |
Of course the laziest most entitled generation expect stock to go up by magic when they buy 1/72 of share of amazon at a time.
Global Market Comments
August 17, 2020
Fiat LuxFeatured Trade:(JOIN THE AUGUST 24-26 MAD HEDGE TRADERS & INVESTORS SUMMIT),
(MARKET OUTLOOK FOR THE WEEK AHEAD, or WELCOME BACK FROM YOUR CRUISE),
(INDU), (TLT), (GLD), (TBT), (FB), (AMZN), (AAPL), (BAC), (JPM)
August 17, 2020
Fiat LuxFeatured Trade:(JOIN THE AUGUST 24-26 MAD HEDGE TRADERS & INVESTORS SUMMIT),
(MARKET OUTLOOK FOR THE WEEK AHEAD, or WELCOME BACK FROM YOUR CRUISE),
(INDU), (TLT), (GLD), (TBT), (FB), (AMZN), (AAPL), (BAC), (JPM)
Join the August 24-26 Mad Hedge Traders & Investors Summit
I have spent the last 50 years looking for the best traders and investors around the world. Now, I have assembled the cream of the crop to share their wealth of knowledge with you.These are individuals who can make money in any market conditions, including a global Covid-19 pandemic. Listen to these speakers and they will enhance your earning power mightily.
As much as I loved hosting my annual Mad Hedge Lake Tahoe Conferences, the Coronavirus had other ideas. I doubt followers are racing to get on airplanes and stay in hotels anytime soon. The desire to sit shoulder to shoulder with your fellow investors has also probably waned as well, no matter how fascinating they may be.
I am therefore hosting the online Thursday, August 24-26 Mad Hedge Traders & Investors Summit.
The event will be far bigger and better than the old analog bricks and mortar version. I will be hosting 27 expert traders from all over the world over three days. They will be speaking on the hour every hour starting from Monday, August 24 at 9:00 AM EST.
Some of these speakers I have known for decades. Every trading style and asset class will be covered, including stocks, options, bonds commodities, foreign exchange, precious metals, energy, and real estate. It will be your best investment educational opportunity of the year.
I will also be offering $100,000 in prizes to attendees in the form of free subscriptions to speaker newsletters, as well as those of the other speakers.
To spice things up, I have invited some real heavyweights. On Monday at 5:00 PM EST, my old friend and SALT host, former White House Press Secretary Anthony Scaramucci and I will discuss the current state of the investment world as well as the outlook for the November presidential election.
On Tuesday, August 25, my buddy Harry Dent, one of the founding fathers of long term demographic investing, will slug it out with me over the outlook for every asset class coming out of the current Great Depression. My colleague, Tom Sosnoff, founder of Tastytrade, will provide a tutorial on using online trading platforms.
I will be at Lake Tahoe, and you will be wishing you were here. As far as I know, human viruses can’t travel over the Internet….yet.
To register for the event, please click here.
To view the list of speakers and their topics, please click here.
I have spent the last 50 years looking for the best traders and investors around the world. Now, I have assembled the cream of the crop to share their wealth of knowledge with you.These are individuals who can make money in any market conditions, including a global Covid-19 pandemic. Listen to these speakers and they will enhance your earning power mightily.
As much as I loved hosting my annual Mad Hedge Lake Tahoe Conferences, the Coronavirus had other ideas. I doubt followers are racing to get on airplanes and stay in hotels anytime soon. The desire to sit shoulder to shoulder with your fellow investors has also probably waned as well, no matter how fascinating they may be.
I am therefore hosting the online Thursday, August 24-26 Mad Hedge Traders & Investors Summit.
The event will be far bigger and better than the old analog bricks and mortar version. I will be hosting 27 expert traders from all over the world over three days. They will be speaking on the hour every hour starting from Monday, August 24 at 9:00 AM EST.
Some of these speakers I have known for decades. Every trading style and asset class will be covered, including stocks, options, bonds commodities, foreign exchange, precious metals, energy, and real estate. It will be your best investment educational opportunity of the year.
I will also be offering $100,000 in prizes to attendees in the form of free subscriptions to speaker newsletters, as well as those of the other speakers.
To spice things up, I have invited some real heavyweights. On Monday at 5:00 PM EST, my old friend and SALT host, former White House Press Secretary Anthony Scaramucci and I will discuss the current state of the investment world as well as the outlook for the November presidential election.
On Tuesday, August 25, my buddy Harry Dent, one of the founding fathers of long term demographic investing, will slug it out with me over the outlook for every asset class coming out of the current Great Depression. My colleague, Tom Sosnoff, founder of Tastytrade, will provide a tutorial on using online trading platforms.
I will be at Lake Tahoe, and you will be wishing you were here. As far as I know, human viruses can’t travel over the Internet….yet.
To register for the event, please click here.
To view the list of speakers and their topics, please click here.
The Market Outlook for the Week Ahead, or Welcome Back from Your Cruise
I have long advocated a long cruise as the best of all long-term investment strategies. After all, over the past 100 years, stocks have gone up 80% of the time, including the last Great Depression and WWII. Almost all news is negative, so ignoring should boost your investment returns immensely.The last six months offer the most recent example. If you had departed on February 14 and return on Friday, August 14, the index return would have been absolutely zero, but you would have collected 1% in dividends. If you had been overweight in technology and biotech stocks, as I have been advocating for the past decade, you would have been up 20-30%.
Of course, this year, cruising presented its own risks, not from a sinking ship, pirates, or the norovirus, but from Covid-19. Many guests departed in the best of spirits to return DOA in the ship’s overcrowded meat locker.
The stock markets are offering more than the usual amount of risks as well. Think of an irresistible force, massive liquidity, meeting the immovable object, record-high valuations.
Only action in Washington could break this stalemate to the upside, a deal between the House and the White House that brings yet another stimulus package. Most of whatever money gets approved will head straight for the stock market, either directly or indirectly. Until then, we will be trapped in a narrow range.
These conditions could last into September, or until after the election. Nobody knows. That’s why eight of my nine positions expire on Friday, in four trading days.
Trump took executive action to help the economy but offers not a penny in funding. He expects states running record deficits to pay for a big chunk. It’s a symbolic act that will have no impact on the economy. The bottom line is no more stimulus for the economy. Stocks will hate it. Trump fiddles while America burns.
A bond market collapse is imminent, with record new issuance in the coming week and a strong July Nonfarm Payroll Report last Friday. Expect ten-year Treasury yields to go back to 0.95% and prices to collapse. Inflation is ticking up, with Consumer prices rising to 1.6% YOY. Fed buying of $80 billion a month is already in the price. I am selling short the (TLT).
Warren Buffet was a major buyer of His own stock, picking up a record $5.1 billion worth of Berkshire Hathaway (BRK/B). With $146.6 billion in cash on hand, what else is he going to do? Berkshire Class A shares were down 7.4% for the year through Friday’s close, compared with the 3.7% gain in the S&P 500. It’s his way of betting on the long-term future of industrial America at a discount.
Russia claimed Covid-19 Vaccine, causing stocks to pop. The rotation trade continues with a vengeance, with tech (I’m short), bonds (I’m short), and gold down big and “recovery” stocks like cruise lines, hotels, restaurants, and banks (I’m long) on a tear. Some $5 trillion in cash is pouring in from the sidelines, so there is only “UP” and “UP BIG”. (SPY) hit a new all-time high.
Tesla announced 5:1 stock split on August 21, which is the options expiration day. Long expected, it is just the latest in a series of Elon Musk attacks against the shorts, of which I am now one. The shares are up only 7% on the announcement. The impact won’t be so great, as it only takes the shares back to where they were in March.
Biden picked Kamela Harris as VP. It is the safe choice, not that California was ever in doubt in the electoral college. A moderate choice clearly takes aim at the conservative Midwest. Markets will rally because she is not Elisabeth Warren, who would have pilloried the banks and big tech and is essentially anti-capitalist.
College Football is postponed for 2020-2012, delivering a $4 billion hit to sponsoring colleges and another drag on GDP. No more free Corvettes for USC players. It's another example of local government taking the lead on Corona measures where the federal government is totally absent.
Van Eck targets $3,400 for gold. One of the original players in gold mutual funds who I know from the big bull market during the 1970s sees a 72% increase in the barbarous relic coming. With the government running the printing presses 24/7 to end the Great Depression collapsing the US dollar, it’s a no-brainer.
Consumer Prices unexpectedly jump, up 0.6% in July and 1.6% YOY. It’s a legitimate “green shoot” and provided yet another reason for the recovery trade. Rebounding inflation is always a great time to be short the US Treasury bond market (TLT). Keep selling every rally in the (TLT).
Retail Sales jump 1.2% in July, despite rising Corona cases, taking it back above pre-pandemic levels. Industrial Production picked up 3%. A lot was bought on credit. The problem is that all of those stimulus and unemployment dollars are now gone. In the meantime, further aid is frozen in Washington. No shopping, no growth.
Weekly Jobless Claims drop below one million for the first time since March. It’s still terrible, but it’s progress. Take what you can get. However, the rate of decline is flagging, and the next report could well bring an upturn.
When we come out the other side of this, we will be perfectly poised to launch into my new American Golden Age, or the next Roaring Twenties. With interest rates still at zero, oil cheap, there will be no reason not to. The Dow Average will rise by 400% or more in the coming decade. The American coming out the other side of the pandemic will be far more efficient and profitable than the old.
Nothing refreshes and clears the mind like a vacation.
As a result, my Global Trading Dispatch blasted through to a substantial new all-time high. August is running at a blistering 6.03%, delivering a 2020 year to date of 34.66%, versus -2.00% for the Dow Average. That takes my eleven-year average annualized performance to a new all-time high of 36.61%. My 11-year total return has rocketed to 390.57%.
It certainly helped being short big tech (AAPL), (AMZN), (FB), short US Treasury bonds (TLT), (TBT), long banks (JPM), (BAC), and long gold (GLD).
The only numbers that count for the market are the number of US Corona virus cases and deaths, which you can find here.
On Monday, August 17 at 8:30 AM EST, the August New York Empire State Manufacturing Index is published.
On Tuesday, August 18 at 8:30 AM EST, Housing Starts for July are released.
On Wednesday, August 19 at 10:30 AM EST, the EIA Cushing Crude Oil Stocks are out.
On Thursday, August 20 at 8:30 AM EST, the Weekly Jobless Claims are announced.
On Friday, August 14, at 10:00 AM EST, Existing Home Sales for July are printed. At 2:00 PM The Bakers Hughes Rig Count is released.
As for me, with six days of 100-degree temperatures forecast, I attempted to go to the beach. A car crash on the Richmond Bridge trapped me in traffic for an hour. By the time I made it to the coast, the beaches were unreachable, thanks to unprecedented crowding.
With the local real unemployment rate at 25%, people have a lot of free time on their hands these days. It’s all part of the times we live in.
Stay healthy,
John Thomas
CEO & Publisher
The Diary of a Mad Hedge Fund Trader
I have long advocated a long cruise as the best of all long-term investment strategies. After all, over the past 100 years, stocks have gone up 80% of the time, including the last Great Depression and WWII. Almost all news is negative, so ignoring should boost your investment returns immensely.The last six months offer the most recent example. If you had departed on February 14 and return on Friday, August 14, the index return would have been absolutely zero, but you would have collected 1% in dividends. If you had been overweight in technology and biotech stocks, as I have been advocating for the past decade, you would have been up 20-30%.
Of course, this year, cruising presented its own risks, not from a sinking ship, pirates, or the norovirus, but from Covid-19. Many guests departed in the best of spirits to return DOA in the ship’s overcrowded meat locker.
The stock markets are offering more than the usual amount of risks as well. Think of an irresistible force, massive liquidity, meeting the immovable object, record-high valuations.
Only action in Washington could break this stalemate to the upside, a deal between the House and the White House that brings yet another stimulus package. Most of whatever money gets approved will head straight for the stock market, either directly or indirectly. Until then, we will be trapped in a narrow range.
These conditions could last into September, or until after the election. Nobody knows. That’s why eight of my nine positions expire on Friday, in four trading days.
Trump took executive action to help the economy but offers not a penny in funding. He expects states running record deficits to pay for a big chunk. It’s a symbolic act that will have no impact on the economy. The bottom line is no more stimulus for the economy. Stocks will hate it. Trump fiddles while America burns.
A bond market collapse is imminent, with record new issuance in the coming week and a strong July Nonfarm Payroll Report last Friday. Expect ten-year Treasury yields to go back to 0.95% and prices to collapse. Inflation is ticking up, with Consumer prices rising to 1.6% YOY. Fed buying of $80 billion a month is already in the price. I am selling short the (TLT).
Warren Buffet was a major buyer of His own stock, picking up a record $5.1 billion worth of Berkshire Hathaway (BRK/B). With $146.6 billion in cash on hand, what else is he going to do? Berkshire Class A shares were down 7.4% for the year through Friday’s close, compared with the 3.7% gain in the S&P 500. It’s his way of betting on the long-term future of industrial America at a discount.
Russia claimed Covid-19 Vaccine, causing stocks to pop. The rotation trade continues with a vengeance, with tech (I’m short), bonds (I’m short), and gold down big and “recovery” stocks like cruise lines, hotels, restaurants, and banks (I’m long) on a tear. Some $5 trillion in cash is pouring in from the sidelines, so there is only “UP” and “UP BIG”. (SPY) hit a new all-time high.
Tesla announced 5:1 stock split on August 21, which is the options expiration day. Long expected, it is just the latest in a series of Elon Musk attacks against the shorts, of which I am now one. The shares are up only 7% on the announcement. The impact won’t be so great, as it only takes the shares back to where they were in March.
Biden picked Kamela Harris as VP. It is the safe choice, not that California was ever in doubt in the electoral college. A moderate choice clearly takes aim at the conservative Midwest. Markets will rally because she is not Elisabeth Warren, who would have pilloried the banks and big tech and is essentially anti-capitalist.
College Football is postponed for 2020-2012, delivering a $4 billion hit to sponsoring colleges and another drag on GDP. No more free Corvettes for USC players. It's another example of local government taking the lead on Corona measures where the federal government is totally absent.
Van Eck targets $3,400 for gold. One of the original players in gold mutual funds who I know from the big bull market during the 1970s sees a 72% increase in the barbarous relic coming. With the government running the printing presses 24/7 to end the Great Depression collapsing the US dollar, it’s a no-brainer.
Consumer Prices unexpectedly jump, up 0.6% in July and 1.6% YOY. It’s a legitimate “green shoot” and provided yet another reason for the recovery trade. Rebounding inflation is always a great time to be short the US Treasury bond market (TLT). Keep selling every rally in the (TLT).
Retail Sales jump 1.2% in July, despite rising Corona cases, taking it back above pre-pandemic levels. Industrial Production picked up 3%. A lot was bought on credit. The problem is that all of those stimulus and unemployment dollars are now gone. In the meantime, further aid is frozen in Washington. No shopping, no growth.
Weekly Jobless Claims drop below one million for the first time since March. It’s still terrible, but it’s progress. Take what you can get. However, the rate of decline is flagging, and the next report could well bring an upturn.
When we come out the other side of this, we will be perfectly poised to launch into my new American Golden Age, or the next Roaring Twenties. With interest rates still at zero, oil cheap, there will be no reason not to. The Dow Average will rise by 400% or more in the coming decade. The American coming out the other side of the pandemic will be far more efficient and profitable than the old.
Nothing refreshes and clears the mind like a vacation.
As a result, my Global Trading Dispatch blasted through to a substantial new all-time high. August is running at a blistering 6.03%, delivering a 2020 year to date of 34.66%, versus -2.00% for the Dow Average. That takes my eleven-year average annualized performance to a new all-time high of 36.61%. My 11-year total return has rocketed to 390.57%.
It certainly helped being short big tech (AAPL), (AMZN), (FB), short US Treasury bonds (TLT), (TBT), long banks (JPM), (BAC), and long gold (GLD).
The only numbers that count for the market are the number of US Corona virus cases and deaths, which you can find here.
On Monday, August 17 at 8:30 AM EST, the August New York Empire State Manufacturing Index is published.
On Tuesday, August 18 at 8:30 AM EST, Housing Starts for July are released.
On Wednesday, August 19 at 10:30 AM EST, the EIA Cushing Crude Oil Stocks are out.
On Thursday, August 20 at 8:30 AM EST, the Weekly Jobless Claims are announced.
On Friday, August 14, at 10:00 AM EST, Existing Home Sales for July are printed. At 2:00 PM The Bakers Hughes Rig Count is released.
As for me, with six days of 100-degree temperatures forecast, I attempted to go to the beach. A car crash on the Richmond Bridge trapped me in traffic for an hour. By the time I made it to the coast, the beaches were unreachable, thanks to unprecedented crowding.
With the local real unemployment rate at 25%, people have a lot of free time on their hands these days. It’s all part of the times we live in.
Stay healthy,
John Thomas
CEO & Publisher
The Diary of a Mad Hedge Fund Trader
Quote of the Day
"Technology has outrun the ability of the market to handle it. When the next bear market comes, there could be a messy affair," said my friend and client Leon Cooperman of hedge fund Omega Advisors.
LLNW Interesting read..No doubt LLNW is not over valued given the near term information.
Long hold still.
[h=1]Limelight Networks: It's Time To Leverage Relationships And Expertise[/h]Aug. 17, 2020 5:20 AM ET|
17 comments
|
About: Limelight Networks, Inc. (LLNW), Includes: AKAM, AMZN, FSLY, NET
Thomas Cheatham
Growth, long-term horizon, biotech, small-cap
Summary
The wave of OTT and streaming content is crashing over the tech world in a big way and shows no signs of slowing.
Content Delivery Providers or CDNs have been forced to innovate and expand to meet growing demand and competition seems fierce.
Time for Limelight Networks to step up to the plate in a big way to play a bit of catch-up in terms of valuation to peers.
Limelight can certainly leverage its current client relationships and their breadth of innovation to expand their product offering.
The recent cash infusion of $100 million into an already healthy balance sheet will most certainly be accompanied by major contract expansions from massive clients.
Let’s set the stage a little. You are one of the oldest companies in a relatively new space. Your sector is booming and growth is expected to be exponential in the coming years. A world pandemic has actually thrown a massive amount of fuel on the fire of an already booming sector as the push to digital gains steam. You look around and find that some of the new guys in your arena are cashing in much faster on the hype than you are in terms of valuation.
What do you do?
This is the exact situation that Limelight Networks (LLNW) finds itself in today. Peers such as Cloudflare (NYSE:NET), Akamai (NASDAQ:AKAM), and Fastly (NYSE:FSLY) all have superior valuations compared to LLNW and it’s hard to understand why. This disparity often leaves many investors scratching their heads. Let's dig into the reasons why one of two things have played out in the sector and figure out which scenario is most likely. Are my peers overvalued or am I undervalued? The truth lies somewhere in the middle.
[h=3]A Little Background on CDNs and the Sector[/h]Simply put, Limelight Networks is a CDN (content delivery network). When you want to stream just about anything these days, be it videos on demand, live TV, or even a plethora of gaming options, you will almost certainly be receiving this data via a CDN. Content providers can beam out content fairly easily these days, but how do you get it from point A to point B with the best connection for quality and the most efficient way possible? Using the software of a CDN, the traffic is managed, sorted, and routed to “Point of Presence” data centers, or POP servers, for effective pushing of the content in a more localized fashion.
Think logistics here much like the USPS. Data moves through channels of regional distribution and gets pushed to the POP closest to the user wanting to access that data, like a local post office, and it’s pushed to them using local infrastructure for delivery. As streaming services grow like weeds, these CDN services will gain more and more traffic at a very high rate of adoption.
How many people are moving from linear TV to streaming? Let’s take a quick look just to give an idea of TAM (total addressable market).
Source: Big Ideas 2020 - ARK Invest
Think back to VHS going to DVD and how quickly that change took hold. The same thing is happening before our eyes when it comes to linear TV customers converting to streaming and OTT. The snowball started rolling down the hill some time ago and is getting bigger and bigger every single day.
[h=3]The Competition[/h]LLNW was founded in 2001 in Tempe, AZ. They are one of the oldest companies in the CDN sector except for AKAM, which was founded in 1998, though AKAM started as a technology security pure-play before it moved into streaming networks. NET was founded in 2009, and FSLY founded in 2011.
Limelight has become somewhat of the dinosaur that has steady contracts, steady income, and great technology with a wide reach, but they aren’t growing fast enough for some investors to take notice, at least on the balance sheet side. While the numbers hold constant, the seeming lack of revenue growth can be a turn off of sorts. Yet the relationships that LLNW has are becoming superior, and their physical network and customer-facing features are experiencing massive growth in their own right.
What slowed LLNW's growth trajectory? A long-lasting legal matter with AKAM that didn’t go Limelight’s way seems to have caused some lack of focus for a while. Combined with stagnant growth before the streaming sector really got traction, the split focus with this legal matter made Limelight stumble and drag their feet.
So now what? What’s Limelight’s deal now?
When tech growth stocks are being bought up like crazy, we need to dig down a little deeper to determine why Limelight has been unjustly left behind. This article is geared towards why Limelight is a differentiator in the space, and a subsequent article focusing more on the numbers as they relate to direct financial comparisons, including balance sheets, market valuations, and earning power of their offering as compared to peers will be released in the coming weeks.
[h=3]Limelight’s Game-changing Products: The Network and POPS[/h]Limelight Networks has an expansive network of 123 POP servers (POPS) globally and has more than 1,000 connections to internet service providers (ISPs) as well as leading cloud providers. This allows Limelight to provide low-latency edge computing all over the world. Limelight’s edge computing platform, called EdgeFunctions, optimizes video streaming and content delivery use through a seamless and streamlined process. This serverless platform automatically allows ISPs and cloud providers to have their code available to edge locations globally and work together in a technological symphony to push data and entertainment right to where it is needed.
For the less tech-savvy, a simple comparison might be water heater technology. Stay with me. Previously CDNs delivered content in a much less efficient way having to call data from widely spread out locales. Ever try to call the hot water to your shower from the water heater in the garage and you have to wait a while to get it going? In data delivery, that would be called buffering and latency. It used to be a pain - remember dial-up? The level of efficiency with which data is routed through POPS now provides low buffering, shorter wait times and better latency.
Fast forward to Limelight’s current network which is like having a tankless hot water heater. Endless hot water now on-demand! Once 5G gets fully integrated, that water is going to be instant on, as hot as you could ever want it, and delivered at the highest water pressure you could possibly handle or need... only with data, not water. Limelight’s management in recent interviews have stated that their network would very soon be limited only by the capability of the end user's device.
Source: Global Private Network
Having this type of global presence along with a deep and rich product offering is key to not only a high-quality product but also provides the ability to leverage relationships. If any of Limelight’s customers were to have issues in one of its global POPS, it has the ability to reach out to local ISPs and address the problem locally. This also provides the opportunity to expand with very little effort. As 5G grows out globally, this advantage will be key.
[h=3]Talk 5G To Me : How Limelight will Grow With 5G and EdgeFunctions[/h]For 5G to fulfill its requirements in bandwidth and latency, edge computing is a much-needed resource. It will allow developers to scale the 5G experience as well as provide the most enhanced experience for users of apps requiring high amounts of data. We know that 5G will increase the global network’s capability; however, as stated earlier, Limelight’s POPs and EdgeFunctions platform will allow applications to be accommodated physically closer to the end-user. This means less distance traveled for data packets (no longer strictly utilizing the centralized cloud) and a higher quality experience on platforms where low latency and high bandwidth are required, such as cloud gaming, loT (internet of things, more on that below), and augmented reality.
As 5G becomes a global reality in the next 2-5 years, Limelight’s EdgeFunctions will be instrumental in its effectiveness and performance. This will be one of Limelight’s many tailwinds for growth. Imagine the value of Limelight when places everywhere are using its technology for the following IoT devices, just to name a few:
The global growth in use of edge computing, such as Limelight’s EdgeFunctions will allow applications to deliver 5G improvements at scale even sooner when used with 4G, as seen in the image below.
Source: 5G Needs Edge Computing to Deliver on Its Promises
Many applications in the long-term future will also require 5G and edge computing to work together. Ultra-low-latency requirements, like those found in robotic motion control, will not function effectively with 5G alone. Edge computing resources, like Limelight’s EdgeFunctions will be instrumental in achieving these requirements. This is where the ability of EdgeFunctions to cut down on the distance traveled by the data will continue to increase the demand for Limelight’s products. The image below demonstrates this edge computing ability.
Source: 5G Needs Edge Computing to Deliver on Its Promises
[h=3]Time to Kiss and Tell: Who is Shacking up With Limelight Networks?[/h]Many investors often compare companies by who they are doing business with. The thought process here is the more powerful the customer base, the more powerful the connections. This is absolutely true and one of the main reasons we are beating the drum on Limelight networks to really leverage these connections.
The following is a link to the client list from Limelight’s website:
Customer Base | Limelight Networks
It’s a pretty extensive list considering it is opt-in, meaning customers can choose whether or not to be added to the public list. However, there are some extremely meaningful clients that are NOT listed in this customer base which we will now discuss. The main one to keep an eye? Amazon (NASDAQ:AMZN).
Amazon Prime Video Might Go LIVE? Yes Please!
Amazon Prime Video made up 30% of LLNW’s revenue recently, and the word from reputable sources is that Amazon is on the prowl to expand their video offerings in an effort to stay competitive. Amazon Prime Video has been cruising for years, but with the explosion of Disney+ and Peacock among many others eating away some of their market share, Amazon is making strides to take some of that back.
Amazon has been in active discussions with several partners on possibly offering live TV streaming to compete with Sling, Hulu, and other providers. Amazon has some proprietary streaming material in its own right, but several services are taking a hybrid approach of offering not only their own content, but connecting to live TV streaming for those that want to cut the cord but not stray too far from what they are used to seeing on the cable box.
It's easy to see Amazon would have a huge advantage. Not only does it have Amazon Prime Video that is tried and true, but it can leverage all of its equipment like Fire TV, Amazon Recast, and Alexa integration to deliver a powerful punch if they do in fact introduce live TV streaming as well. They can easily work an interface across all of the Amazon family of products to deliver a product offering to all Prime members for a very comparable fee.
To turn this back around on Limelight, because LLNW is one of the largest CDNs that Amazon Prime Video uses, they would naturally be the go-to partner for a live TV streaming relationship. The CEO of Limelight, Mr. Lento, has alluded to a very large customer signing a contract very soon after months of beta testing. While we cannot be sure this refers to Amazon, connecting the dots makes it seem quite plausible.
We urge interested readers to listen to the Second Qtr 2020 Limelight conference call. During the question and answer session, an analyst directly asks Limelight management about Amazon as the potential LIVE TV partner. It was interesting to hear the clever deflection and quick footwork from management to give some detail about their partnership with Amazon but not disclose anything that would go against FD Regulatory rules.
If this partnership comes to fruition, we feel very confident that investors will start to take notice and give LLNW credit where credit is due.
[h=3]Conclusion[/h]While we understand why investors are getting excited about other CDN offerings in the marketplace over and above Limelight, we feel the valuation gaps have gotten overly obscure. Limelight has a proven reliable network with many options for clients to utilize and scale-up. They are dropping costs while continuing to tailor their offering for efficiency, speed, and usability, yet their stock price remains unreasonably low in valuation metrics today, especially when compared to peers.
An upcoming article really dives into the numbers and compares them, but touching on it quickly, we think LLNW is easily worth a conservative $12 to $15 per share when compared to their competitors in the space. Limelight also just completed a $100 million convertible senior note offering where conversion price is much higher than current stock price. While conversion price doesn’t necessarily translate to stock price increases, what should be noted is that Limelight now has the funds to expand to meet massive demand, whether the large streaming contract the CEO anticipates is with Amazon or another company. Furthermore, it already had a strong balance sheet with a decent cash position before, so it’s hard to fathom why they needed this money so quickly if no deal was imminent.
Chances are they do in fact have a big deal in the works, and they knew they needed the money to meet the coming demand influx and build the network out further. It’s also interesting that the institutional investors that participated in the offering would even entertain such a deal unless they suspected very big moves coming very soon for LLNW stock.
Long hold still.
[h=1]Limelight Networks: It's Time To Leverage Relationships And Expertise[/h]Aug. 17, 2020 5:20 AM ET|
17 comments
|
About: Limelight Networks, Inc. (LLNW), Includes: AKAM, AMZN, FSLY, NET
Thomas Cheatham
Growth, long-term horizon, biotech, small-cap
(317 followers)
Summary
The wave of OTT and streaming content is crashing over the tech world in a big way and shows no signs of slowing.
Content Delivery Providers or CDNs have been forced to innovate and expand to meet growing demand and competition seems fierce.
Time for Limelight Networks to step up to the plate in a big way to play a bit of catch-up in terms of valuation to peers.
Limelight can certainly leverage its current client relationships and their breadth of innovation to expand their product offering.
The recent cash infusion of $100 million into an already healthy balance sheet will most certainly be accompanied by major contract expansions from massive clients.
Let’s set the stage a little. You are one of the oldest companies in a relatively new space. Your sector is booming and growth is expected to be exponential in the coming years. A world pandemic has actually thrown a massive amount of fuel on the fire of an already booming sector as the push to digital gains steam. You look around and find that some of the new guys in your arena are cashing in much faster on the hype than you are in terms of valuation.
What do you do?
This is the exact situation that Limelight Networks (LLNW) finds itself in today. Peers such as Cloudflare (NYSE:NET), Akamai (NASDAQ:AKAM), and Fastly (NYSE:FSLY) all have superior valuations compared to LLNW and it’s hard to understand why. This disparity often leaves many investors scratching their heads. Let's dig into the reasons why one of two things have played out in the sector and figure out which scenario is most likely. Are my peers overvalued or am I undervalued? The truth lies somewhere in the middle.
[h=3]A Little Background on CDNs and the Sector[/h]Simply put, Limelight Networks is a CDN (content delivery network). When you want to stream just about anything these days, be it videos on demand, live TV, or even a plethora of gaming options, you will almost certainly be receiving this data via a CDN. Content providers can beam out content fairly easily these days, but how do you get it from point A to point B with the best connection for quality and the most efficient way possible? Using the software of a CDN, the traffic is managed, sorted, and routed to “Point of Presence” data centers, or POP servers, for effective pushing of the content in a more localized fashion.
Think logistics here much like the USPS. Data moves through channels of regional distribution and gets pushed to the POP closest to the user wanting to access that data, like a local post office, and it’s pushed to them using local infrastructure for delivery. As streaming services grow like weeds, these CDN services will gain more and more traffic at a very high rate of adoption.
How many people are moving from linear TV to streaming? Let’s take a quick look just to give an idea of TAM (total addressable market).
Source: Big Ideas 2020 - ARK Invest
Think back to VHS going to DVD and how quickly that change took hold. The same thing is happening before our eyes when it comes to linear TV customers converting to streaming and OTT. The snowball started rolling down the hill some time ago and is getting bigger and bigger every single day.
[h=3]The Competition[/h]LLNW was founded in 2001 in Tempe, AZ. They are one of the oldest companies in the CDN sector except for AKAM, which was founded in 1998, though AKAM started as a technology security pure-play before it moved into streaming networks. NET was founded in 2009, and FSLY founded in 2011.
Limelight has become somewhat of the dinosaur that has steady contracts, steady income, and great technology with a wide reach, but they aren’t growing fast enough for some investors to take notice, at least on the balance sheet side. While the numbers hold constant, the seeming lack of revenue growth can be a turn off of sorts. Yet the relationships that LLNW has are becoming superior, and their physical network and customer-facing features are experiencing massive growth in their own right.
What slowed LLNW's growth trajectory? A long-lasting legal matter with AKAM that didn’t go Limelight’s way seems to have caused some lack of focus for a while. Combined with stagnant growth before the streaming sector really got traction, the split focus with this legal matter made Limelight stumble and drag their feet.
So now what? What’s Limelight’s deal now?
When tech growth stocks are being bought up like crazy, we need to dig down a little deeper to determine why Limelight has been unjustly left behind. This article is geared towards why Limelight is a differentiator in the space, and a subsequent article focusing more on the numbers as they relate to direct financial comparisons, including balance sheets, market valuations, and earning power of their offering as compared to peers will be released in the coming weeks.
[h=3]Limelight’s Game-changing Products: The Network and POPS[/h]Limelight Networks has an expansive network of 123 POP servers (POPS) globally and has more than 1,000 connections to internet service providers (ISPs) as well as leading cloud providers. This allows Limelight to provide low-latency edge computing all over the world. Limelight’s edge computing platform, called EdgeFunctions, optimizes video streaming and content delivery use through a seamless and streamlined process. This serverless platform automatically allows ISPs and cloud providers to have their code available to edge locations globally and work together in a technological symphony to push data and entertainment right to where it is needed.
For the less tech-savvy, a simple comparison might be water heater technology. Stay with me. Previously CDNs delivered content in a much less efficient way having to call data from widely spread out locales. Ever try to call the hot water to your shower from the water heater in the garage and you have to wait a while to get it going? In data delivery, that would be called buffering and latency. It used to be a pain - remember dial-up? The level of efficiency with which data is routed through POPS now provides low buffering, shorter wait times and better latency.
Fast forward to Limelight’s current network which is like having a tankless hot water heater. Endless hot water now on-demand! Once 5G gets fully integrated, that water is going to be instant on, as hot as you could ever want it, and delivered at the highest water pressure you could possibly handle or need... only with data, not water. Limelight’s management in recent interviews have stated that their network would very soon be limited only by the capability of the end user's device.
Source: Global Private Network
Having this type of global presence along with a deep and rich product offering is key to not only a high-quality product but also provides the ability to leverage relationships. If any of Limelight’s customers were to have issues in one of its global POPS, it has the ability to reach out to local ISPs and address the problem locally. This also provides the opportunity to expand with very little effort. As 5G grows out globally, this advantage will be key.
[h=3]Talk 5G To Me : How Limelight will Grow With 5G and EdgeFunctions[/h]For 5G to fulfill its requirements in bandwidth and latency, edge computing is a much-needed resource. It will allow developers to scale the 5G experience as well as provide the most enhanced experience for users of apps requiring high amounts of data. We know that 5G will increase the global network’s capability; however, as stated earlier, Limelight’s POPs and EdgeFunctions platform will allow applications to be accommodated physically closer to the end-user. This means less distance traveled for data packets (no longer strictly utilizing the centralized cloud) and a higher quality experience on platforms where low latency and high bandwidth are required, such as cloud gaming, loT (internet of things, more on that below), and augmented reality.
As 5G becomes a global reality in the next 2-5 years, Limelight’s EdgeFunctions will be instrumental in its effectiveness and performance. This will be one of Limelight’s many tailwinds for growth. Imagine the value of Limelight when places everywhere are using its technology for the following IoT devices, just to name a few:
- Connected appliances
- Smart home security systems
- Autonomous farming equipment
- Wearable health monitors
- Smart factory equipment
- Wireless inventory trackers
- Ultra-high speed wireless internet
- Biometric cybersecurity scanners
The global growth in use of edge computing, such as Limelight’s EdgeFunctions will allow applications to deliver 5G improvements at scale even sooner when used with 4G, as seen in the image below.
Source: 5G Needs Edge Computing to Deliver on Its Promises
Many applications in the long-term future will also require 5G and edge computing to work together. Ultra-low-latency requirements, like those found in robotic motion control, will not function effectively with 5G alone. Edge computing resources, like Limelight’s EdgeFunctions will be instrumental in achieving these requirements. This is where the ability of EdgeFunctions to cut down on the distance traveled by the data will continue to increase the demand for Limelight’s products. The image below demonstrates this edge computing ability.
Source: 5G Needs Edge Computing to Deliver on Its Promises
[h=3]Time to Kiss and Tell: Who is Shacking up With Limelight Networks?[/h]Many investors often compare companies by who they are doing business with. The thought process here is the more powerful the customer base, the more powerful the connections. This is absolutely true and one of the main reasons we are beating the drum on Limelight networks to really leverage these connections.
The following is a link to the client list from Limelight’s website:
Customer Base | Limelight Networks
It’s a pretty extensive list considering it is opt-in, meaning customers can choose whether or not to be added to the public list. However, there are some extremely meaningful clients that are NOT listed in this customer base which we will now discuss. The main one to keep an eye? Amazon (NASDAQ:AMZN).
Amazon Prime Video Might Go LIVE? Yes Please!
Amazon Prime Video made up 30% of LLNW’s revenue recently, and the word from reputable sources is that Amazon is on the prowl to expand their video offerings in an effort to stay competitive. Amazon Prime Video has been cruising for years, but with the explosion of Disney+ and Peacock among many others eating away some of their market share, Amazon is making strides to take some of that back.
Amazon has been in active discussions with several partners on possibly offering live TV streaming to compete with Sling, Hulu, and other providers. Amazon has some proprietary streaming material in its own right, but several services are taking a hybrid approach of offering not only their own content, but connecting to live TV streaming for those that want to cut the cord but not stray too far from what they are used to seeing on the cable box.
It's easy to see Amazon would have a huge advantage. Not only does it have Amazon Prime Video that is tried and true, but it can leverage all of its equipment like Fire TV, Amazon Recast, and Alexa integration to deliver a powerful punch if they do in fact introduce live TV streaming as well. They can easily work an interface across all of the Amazon family of products to deliver a product offering to all Prime members for a very comparable fee.
To turn this back around on Limelight, because LLNW is one of the largest CDNs that Amazon Prime Video uses, they would naturally be the go-to partner for a live TV streaming relationship. The CEO of Limelight, Mr. Lento, has alluded to a very large customer signing a contract very soon after months of beta testing. While we cannot be sure this refers to Amazon, connecting the dots makes it seem quite plausible.
We urge interested readers to listen to the Second Qtr 2020 Limelight conference call. During the question and answer session, an analyst directly asks Limelight management about Amazon as the potential LIVE TV partner. It was interesting to hear the clever deflection and quick footwork from management to give some detail about their partnership with Amazon but not disclose anything that would go against FD Regulatory rules.
If this partnership comes to fruition, we feel very confident that investors will start to take notice and give LLNW credit where credit is due.
[h=3]Conclusion[/h]While we understand why investors are getting excited about other CDN offerings in the marketplace over and above Limelight, we feel the valuation gaps have gotten overly obscure. Limelight has a proven reliable network with many options for clients to utilize and scale-up. They are dropping costs while continuing to tailor their offering for efficiency, speed, and usability, yet their stock price remains unreasonably low in valuation metrics today, especially when compared to peers.
An upcoming article really dives into the numbers and compares them, but touching on it quickly, we think LLNW is easily worth a conservative $12 to $15 per share when compared to their competitors in the space. Limelight also just completed a $100 million convertible senior note offering where conversion price is much higher than current stock price. While conversion price doesn’t necessarily translate to stock price increases, what should be noted is that Limelight now has the funds to expand to meet massive demand, whether the large streaming contract the CEO anticipates is with Amazon or another company. Furthermore, it already had a strong balance sheet with a decent cash position before, so it’s hard to fathom why they needed this money so quickly if no deal was imminent.
Chances are they do in fact have a big deal in the works, and they knew they needed the money to meet the coming demand influx and build the network out further. It’s also interesting that the institutional investors that participated in the offering would even entertain such a deal unless they suspected very big moves coming very soon for LLNW stock.
|
| View in browser|nytimes.com |
August 21, 2020 |
|
| Good morning. Steve Bannon was arrested on fraud charges. The postmaster general is set to testify today. And on the final night of the D.N.C., Joe Biden formally accepted his party’s nomination for president. |
| [h=1]What we learned from the D.N.C.[/h] |
|
| Last night, the Democratic National Convention capped off four days of remote speeches, video montages and roll-call votes with a final address from the party’s presidential nominee, Joe Biden. |
| “America’s history tells us that it has been in our darkest moments that we’ve made our greatest progress,” Biden said, in a speech that mixed a somber assessment of the state of the country with hopeful appeals to its values. “And in this dark moment, I believe we are poised to make great progress again.” |
| What did the convention tell us about the Democrats’ message for November? Our colleague Lisa Lerer, who writes the On Politics newsletter, suggested four big takeaways. |
| 1. Character and the coronavirus. The convention pitched Biden’s Washington experience and story of personal tragedy as a match for a moment of national crisis. |
| “Viewers got a very good sense of Biden himself as a family man, someone with a moral compass,” Lisa told us. And both Biden and his running mate, Senator Kamala Harris of California, sharply criticized President Trump’s response to the pandemic. |
| 2. High stakes. “This convention was waged in existential terms,” Lisa said. Perhaps the starkest warning came from former President Barack Obama, who cast his successor as a threat to American democracy. |
| 3. A big tent. From disaffected Republicans to progressive Democrats, the convention showcased the breadth of the coalition the party hopes to mobilize. But squabbles over speaking times, generational gaps and divergent ideologies also laid bare the challenges of holding such a wide coalition together. |
| “On the first night, for example, voters heard from John Kasich, a Republican, and Senator Bernie Sanders, a democratic socialist,” Lisa said. “Those two men likely agree on very little beyond the need to defeat Trump.” |
| 4. Winning is one thing, governing another. Notable speakers like Senator Elizabeth Warren and former President Bill Clinton touted aspects of Biden’s policy agenda, as did Biden himself. But the convention focused more on critiquing Trump’s stance on problems like gun violence, climate change and the virus than on detailing Democrats’ solutions. |
| Given Biden’s current lead, Lisa noted, that might be enough. “But I do think voters like to know what they’re getting with a candidate,” she said. “What will this person do beyond simply ousting the guy in office right now? I’m not sure this convention answered that question.” |
| Trump and the G.O.P. will get a shot at a rejoinder when their own largely virtual convention starts Monday. |
| For more on the D.N.C.’s fourth night: |
|
|
| [h=3]FOUR MORE BIG STORIES[/h] |
| [h=2]1. Steve Bannon arrested on fraud charges[/h] |
|
| Steve Bannon, Trump’s former adviser, was charged with defrauding donors to an online fund-raising effort to build a wall on the U.S.-Mexico border. Prosecutors said Bannon had siphoned nearly $1 million from the project to pay off personal expenses. |
| Bannon was arrested early Thursday by federal postal inspectors and special agents from the U.S. attorney’s office in Manhattan, who found him off the coast of Connecticut, on a 150-foot yacht owned by a fugitive Chinese billionaire. |
| Background: The fund-raising project, called We Build the Wall, brought in more than $25 million. But it failed to accomplish much with the money, and Trump eventually disavowed it. Three others were also arrested. |
| [h=2]2. A warning from a former postal official[/h] |
| David C. Williams, a former member of the U.S. Postal Service’s board of governors who resigned in protest in April, told lawmakers that the Trump administration appeared to want to strong-arm the agency into becoming a “political tool.” |
| “If this is the beginning of what the president promised, it’s the end of the Postal Service,” Williams said of recent policy changes that included raising rates and cutting back crucial services. |
| Today: Postmaster General Louis DeJoy is scheduled to testify before the Senate this morning. He is likely to face tough questions about the cuts and about his potentially conflicting business interests. |
| [h=2]3. As schools reopen, many lack nurses[/h] |
|
| Fewer than 40 percent of American schools had full-time nurses before the pandemic. Yet with outbreaks already emerging in schools that have reopened, there has been no national effort to provide them with resources to hire more. |
| In central Washington State, Janna Benzel is responsible for her entire school district — monitoring 1,800 students for coronavirus symptoms when classrooms open this month, on top of her regular duties. “I’ll have to go to these schools and assess every sniffle and sneeze that could potentially be a positive case,” she told The Times. “I just don’t know if I can do it alone.” |
| Sign up for our Schools Briefing to get the latest on how educators and parents are handling the return to school. |
| [h=2]4. Kremlin critic’s suspected poisoning[/h] |
| A Russian hospital is refusing to allow the prominent Kremlin critic Aleksei Navalny to be transferred abroad for treatment after a suspected poisoning, the opposition leader’s spokeswoman said today, setting up a potential standoff as a plane from Germany arrived to fly him out of the country. |
| Navalny was rushed to the hospital yesterday after he appeared to suffer agonizing pain on a domestic flight after drinking a cup of tea at an airport in Siberia. A doctor said today that nothing had been found to support the idea that Navalny was poisoned. |
| This is not Navalny’s first brush with medical emergencies: In 2017, an assailant threw a green chemical liquid in his face, causing severe eye burns. Last year, while in jail for leading an unauthorized protest, he had to be hospitalized for a mysterious “severe allergic reaction.” |
| Some context: Poison has been the favored weapon of Russia’s security service for over a century. |
| [h=2]Here’s what else is happening[/h] |
|
|
| The truth is essential. Every day, Times journalists report from the front lines and do the deep research. None of this coverage would be possible without our subscribers, so thank you. And if you’re not a subscriber, please consider becoming one today. |
| [h=3]IDEA OF THE DAY: GARDEN YOUR WORRIES AWAY[/h] |
| The pandemic has been a boon to home gardening. The mental and physical benefits of the activity are well known: longer lives, lower levels of depression and exposure to vitamin D. “Gardening reduces stress,” Huma Yasin has written in The Times. |
| Contact with nature can also provide philosophical comfort, The New Yorker’s Rebecca Mead argues: “Many people, when faced with their own mortality or that of their loved ones, become more attuned to the natural world. This is evidence not just of a garden’s power to distract and inspire but of its power to console.” |
| And for some marginalized communities, gardening grants agency over food insecurity and a lack of healthy options. “Possibilities, solutions, freedom — that’s what I’m growing,” a Los Angeles gardener and activist told The Wall Street Journal. “That’s what the gardens represent.” |
| [h=3]PLAY, WATCH, EAT, CUBE[/h] |
| [h=2]Make some dip[/h] |
|
| Cowboy caviar (also known as Texas caviar) lies somewhere between a dip and a salad. You can customize the recipe with corn, avocados or whatever else you have on hand. Serve with tortilla chips and enjoy. |
| [h=2]The translator behind ‘My Brilliant Friend’[/h] |
| If you’ve ever read the wildly popular “Neapolitan Novels” series in English, you’ve come across the translation work of Ann Goldstein. Though she’s worked with Elena Ferrante since 2004, even she has never met the famously secretiveItalian novelist; they communicate through Ferrante’s publisher. |
| Goldstein, who used to lead The New Yorker’s copy desk, became one of the most acclaimed literary translators in the world through her work on the series. The pair collaborated again on Ferrante’s latest novel, “The Lying Life of Adults,” out next month. |
| Read about her fascinating life in a new profile. |
| [h=2]Watch something … mesmerizing[/h] |
|
| Our weekly suggestion from Gilbert Cruz, The Times’s Culture editor: |
| I have never solved a Rubik’s Cube and probably never will. Many of you might be the same. But there’s something fascinating about that colorful square. So small! So difficult! |
| A new Netflix documentary offers a peek into the world of competitive cubing, where mostly young people gather to solve the puzzles as quickly as possible. (We’re talking seconds here.) “The Speed Cubers” focuses specifically on the sweet friendship between two of the top cubers in the world — the Australian star Feliks Zemdegs and the American Max Park, an autistic teenager whose parents first put a cube in his hand as a means of increasing his fine motor skills. |
| Soundtracked by the constant clicky-clack sounds of people fiddling with the cubes, this 40-minute film is a reminder that what might seem small and niche to you can be the whole world to others. |
| [h=2]Diversions[/h] |
|
| [h=2]Games[/h] |
| Here’s today’s Mini Crossword, and a clue: Onetime ruler of Iran (four letters). |
| Or try this week’s news quiz. |
| Thanks for spending part of your morning with The Times. See you Monday. |
| P.S. Join our politics reporters as they recap the Democratic convention in a live virtual event, today at 11 a.m. Eastern. |
| David Leonhardt, this newsletter’s usual writer, will return on Monday. |
| You can see today’s print front page here. |
| Today’s episode of “The Daily” is about life inside the N.B.A.’s bubble at Walt Disney World. On “The Argument,” Opinion writers discuss what Biden and the Democrats need to accomplish. |
Good friend of mine who a chartist sent me his view this AM.
He's been pretty good over the years with the charts...I'm doubtful but I like the thought.
It is a tough stock bozz.If it gets through 268, it will run to 280 shortly afterward.
Great call, this looks as sound as anything out there right now you still pounding JD too?
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[h=1]Wall Street Breakfast: U.S. Futures Head Higher After FDA Increases Access To COVID-19 Treatment[/h]Aug. 24, 2020 6:49 AM ET|
18 comments
|
Includes: BDNCE, BX, DAL, DOORD, EPD, EQNR, MSFT, NAK, ORCL, ORN, RDS.A, RDS.B, TAK, TLSA
Seeking Alpha's flagship daily business news summary, gives you a rapid overview of the day's key financial news. It is published before 7:00 AM ET every market day and delivered to over 900,000 email subscribers.Subscribe
Listen on the go! A daily podcast of Wall Street Breakfast will be available by 8:00 a.m. on Seeking Alpha, iTunes, Stitcher and Spotify.
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U.S. futures head higher after FDA increases access to COVID-19 treatment
Futures for the three major U.S. stock averages have advanced, following President Trump’s announcement that the U.S. FDA issued emergency use authorization for convalescent plasma to treat COVID-19 and, separately, his team have been privately seeking to reassure U.S. companies that they can still do business with the WeChat messaging app in China. S&P futures rise 0.7%, Nasdaq futures +0.9%, and the Dow pushes 0.8% higher. 10-year Treasury slips, pushing yield up almost 1 basis point to 0.64%. In Europe, the Stoxx Europe 600 Index rises 1.7%, U.K.’s FTSE 100 Index adds 1.6%, Germany’s DAX gains 2.1% and France’s CAC climbs 2.2%. In Asia, Hong Kong’s Hang Seng Index closed up 1.7%, Japan’s Nikkei 225 rose 0.3%, and the Shanghai Composite increased 0.2%.
U.S. recession likely to end late 2020 or in 2021, survey says
A majority of economists say Congress should reinstate supplemental unemployment insurance benefits as the U.S. economy isn't likely to emerge from the recession until later this year or at some point next year, according to a survey by the National Association for Business Economics. Most of them also support extending the Paycheck Protection Program for small businesses. Two-thirds of the respondents said the economy is still in the recession that began in February and almost 80% indicated that there is at least a 25% chance of a double-dip recession.
ByteDance investors seek to bid for TikTok assets
Some of the investors in ByteDance (BDNCE), including investment firm General Atlantic, want to take large stakes in TikTok’s North America, Australia, and New Zealand operations while Microsoft (NASDAQ:MSFT) or Oracle (NYSE:ORCL), which are also vying to buy the units, would get a minority stake under the plan. The news comes after reports that TikTok is preparing to legally challenge President Trump’s executive order banning transactions between the popular short-form video app and parent ByteDance. The assets for sale may be valued ~$25B-$35B, sources told Reuters. The ByteDance investors are discussing exchanging some or all of their shares in ByteDance with equity in the TikTok assets, they said.
Go Deeper: See Microsoft's cash, short-term investments and receivables on its balance sheet over the past five years.
More than half of Gulf of Mexico oil production shut down
Energy producers have shut in 1.07M barrels/day, or nearly 58%, of offshore crude oil production and 1.2M cf/day, or 45%, of natural gas output from the U.S. Gulf of Mexico as Hurricane Marco and Tropical Storm Laura head for the region, according to the U.S. Bureau of Safety and Environmental Enforcement. Royal Dutch Shell (RDS.A, RDS.B) shut in production at all but one of its assets in the U.S. Gulf, while Equinor (NYSE:EQNR) evacuated and shut in production at its Titan platform. Workers have been evacuated from 114 production platforms out of the 643 manned platforms in the Gulf of Mexico, the BSEE said. Crude oil prices are pushing higher +0.7% at about 6:00 AM ET.
At least two dead after Corpus Christi gas pipeline blast
Two people are confirmed dead and two others are missing after an underwater gas pipeline exploded when it was struck by a dredging boat in the Port of Corpus Christi, TX. Six others working on the vessel were hospitalized after the Friday incident that sent flames several hundred feet into the air and forced the partial closure of the port. Enterprise Products (NYSE:EPD) owns the ruptured pipeline, which was holding propane gas at the time of the explosion. Early estimates indicate the accident caused the release of 5K lbs. of propane and 5K lbs. of carbon monoxide. The barge that struck the pipeline reportedly was owned by marine construction contractor Orion Group Holdings (NYSE:ORN).
China can achieve growth this year, Premier says
That's if the nation is able to reach its target of adding 9M jobs, Premier Li Keqiang said in the western city of Chongqing. He called on the nation to bolster plans to deal with uncertainties after the economy achieved positive results in recent months, according to a statement on the central government website on Sunday. China's economy recovered to growth, with GDP rising in the three months to June, up 3.2% Y/Y, following a 6.8% decline in Q1.
Takeda to sell consumer unit to Blackstone for $2.3B
Takeda (NYSE:TAK) has agreed to sell its Japanese consumer healthcare business to U.S. investment firm Blackstone Group (NYSE:BX) for $2.3B (¥242B). The portfolio to be divested includes over-the-counter medicines and health products that generated total revenue of more than ¥60B in FY 2019. The deal is expected to close by March 31, 2021.
What else is happening...
Tiziana (NASDAQ:TLSA) gets new U.S. patent for potential COVID-19 treatment.Delta Air Lines (NYSE:DAL) maps strategy for international return.U.S. is expected to block Northern Dynasty Minerals' (NYSEMKT:NAK)controversial Pebble Mine in Alaska.DoorDash (DOORD) aims for Q4 IPO.
Today's Markets
In Asia, Japan +0.3%. Hong Kong +1.7%. China +0.2%. India +1.07%.In Europe, at midday, London +1.6%. Paris +2.3%. Frankfurt +2.1%.Futures at 6:20, Dow +0.8%. S&P +0.7%. Nasdaq +0.9%. Crude +0.68% to $42.63. Gold +0.49% to $1,956.45. Bitcoin +1.73% to $11,790.Ten-year Treasury Yield +0.3 bps to 0.643%
Today's Economic Calendar
8:30 Chicago FedNational Activity Index
Companies reporting earnings today »
Edit
Expand Portfolio
[h=1]Wall Street Breakfast: U.S. Futures Head Higher After FDA Increases Access To COVID-19 Treatment[/h]Aug. 24, 2020 6:49 AM ET|
18 comments
|
Includes: BDNCE, BX, DAL, DOORD, EPD, EQNR, MSFT, NAK, ORCL, ORN, RDS.A, RDS.B, TAK, TLSA
Seeking Alpha's flagship daily business news summary, gives you a rapid overview of the day's key financial news. It is published before 7:00 AM ET every market day and delivered to over 900,000 email subscribers.Subscribe
Listen on the go! A daily podcast of Wall Street Breakfast will be available by 8:00 a.m. on Seeking Alpha, iTunes, Stitcher and Spotify.
SPONSORED BYU.S. futures head higher after FDA increases access to COVID-19 treatment
Futures for the three major U.S. stock averages have advanced, following President Trump’s announcement that the U.S. FDA issued emergency use authorization for convalescent plasma to treat COVID-19 and, separately, his team have been privately seeking to reassure U.S. companies that they can still do business with the WeChat messaging app in China. S&P futures rise 0.7%, Nasdaq futures +0.9%, and the Dow pushes 0.8% higher. 10-year Treasury slips, pushing yield up almost 1 basis point to 0.64%. In Europe, the Stoxx Europe 600 Index rises 1.7%, U.K.’s FTSE 100 Index adds 1.6%, Germany’s DAX gains 2.1% and France’s CAC climbs 2.2%. In Asia, Hong Kong’s Hang Seng Index closed up 1.7%, Japan’s Nikkei 225 rose 0.3%, and the Shanghai Composite increased 0.2%.
U.S. recession likely to end late 2020 or in 2021, survey says
A majority of economists say Congress should reinstate supplemental unemployment insurance benefits as the U.S. economy isn't likely to emerge from the recession until later this year or at some point next year, according to a survey by the National Association for Business Economics. Most of them also support extending the Paycheck Protection Program for small businesses. Two-thirds of the respondents said the economy is still in the recession that began in February and almost 80% indicated that there is at least a 25% chance of a double-dip recession.
ByteDance investors seek to bid for TikTok assets
Some of the investors in ByteDance (BDNCE), including investment firm General Atlantic, want to take large stakes in TikTok’s North America, Australia, and New Zealand operations while Microsoft (NASDAQ:MSFT) or Oracle (NYSE:ORCL), which are also vying to buy the units, would get a minority stake under the plan. The news comes after reports that TikTok is preparing to legally challenge President Trump’s executive order banning transactions between the popular short-form video app and parent ByteDance. The assets for sale may be valued ~$25B-$35B, sources told Reuters. The ByteDance investors are discussing exchanging some or all of their shares in ByteDance with equity in the TikTok assets, they said.
Go Deeper: See Microsoft's cash, short-term investments and receivables on its balance sheet over the past five years.
More than half of Gulf of Mexico oil production shut down
Energy producers have shut in 1.07M barrels/day, or nearly 58%, of offshore crude oil production and 1.2M cf/day, or 45%, of natural gas output from the U.S. Gulf of Mexico as Hurricane Marco and Tropical Storm Laura head for the region, according to the U.S. Bureau of Safety and Environmental Enforcement. Royal Dutch Shell (RDS.A, RDS.B) shut in production at all but one of its assets in the U.S. Gulf, while Equinor (NYSE:EQNR) evacuated and shut in production at its Titan platform. Workers have been evacuated from 114 production platforms out of the 643 manned platforms in the Gulf of Mexico, the BSEE said. Crude oil prices are pushing higher +0.7% at about 6:00 AM ET.
At least two dead after Corpus Christi gas pipeline blast
Two people are confirmed dead and two others are missing after an underwater gas pipeline exploded when it was struck by a dredging boat in the Port of Corpus Christi, TX. Six others working on the vessel were hospitalized after the Friday incident that sent flames several hundred feet into the air and forced the partial closure of the port. Enterprise Products (NYSE:EPD) owns the ruptured pipeline, which was holding propane gas at the time of the explosion. Early estimates indicate the accident caused the release of 5K lbs. of propane and 5K lbs. of carbon monoxide. The barge that struck the pipeline reportedly was owned by marine construction contractor Orion Group Holdings (NYSE:ORN).
China can achieve growth this year, Premier says
That's if the nation is able to reach its target of adding 9M jobs, Premier Li Keqiang said in the western city of Chongqing. He called on the nation to bolster plans to deal with uncertainties after the economy achieved positive results in recent months, according to a statement on the central government website on Sunday. China's economy recovered to growth, with GDP rising in the three months to June, up 3.2% Y/Y, following a 6.8% decline in Q1.
Takeda to sell consumer unit to Blackstone for $2.3B
Takeda (NYSE:TAK) has agreed to sell its Japanese consumer healthcare business to U.S. investment firm Blackstone Group (NYSE:BX) for $2.3B (¥242B). The portfolio to be divested includes over-the-counter medicines and health products that generated total revenue of more than ¥60B in FY 2019. The deal is expected to close by March 31, 2021.
What else is happening...
Tiziana (NASDAQ:TLSA) gets new U.S. patent for potential COVID-19 treatment.Delta Air Lines (NYSE:DAL) maps strategy for international return.U.S. is expected to block Northern Dynasty Minerals' (NYSEMKT:NAK)controversial Pebble Mine in Alaska.DoorDash (DOORD) aims for Q4 IPO.
Today's Markets
In Asia, Japan +0.3%. Hong Kong +1.7%. China +0.2%. India +1.07%.In Europe, at midday, London +1.6%. Paris +2.3%. Frankfurt +2.1%.Futures at 6:20, Dow +0.8%. S&P +0.7%. Nasdaq +0.9%. Crude +0.68% to $42.63. Gold +0.49% to $1,956.45. Bitcoin +1.73% to $11,790.Ten-year Treasury Yield +0.3 bps to 0.643%
Today's Economic Calendar
8:30 Chicago FedNational Activity Index
Companies reporting earnings today »
[h=1][FONT=Verdana, Arial, Helvetica, sans-serif]Watching for more weakness in AVDL this AM..Buying more at some point this week.. AVDL will be a big winner.[/FONT]
Alibaba gets Street-high price target after FQ1 report[/h]Aug. 24, 2020 10:02 AM ET|About: Alibaba Group Holding Limited (BABA)|By: Brandy Betz, SA News Editor
Citing last week's fiscal first quarter results, Susquehanna raises Alibaba's (NYSE:BABA) price target from $275 to $350.
The firm says BABA's results were "strong across the board" and notes that pandemic has shifted shoppers towards online shopping, which will benefit Alibaba's position at the forefront of Chinese e-commerce.
Susquehanna maintains a Positive rating on BABA. Wall Street analysts, Quants, and SA contributors average out to Bullish to Very Bullish ratings.
Alibaba shares are up 3.2% to $274.20.
Previously: Cloud computing helps drive Alibaba's 34% revenue growth in fiscal Q1 (Aug. 20 2020)
Alibaba gets Street-high price target after FQ1 report[/h]Aug. 24, 2020 10:02 AM ET|About: Alibaba Group Holding Limited (BABA)|By: Brandy Betz, SA News Editor
Citing last week's fiscal first quarter results, Susquehanna raises Alibaba's (NYSE:BABA) price target from $275 to $350.
The firm says BABA's results were "strong across the board" and notes that pandemic has shifted shoppers towards online shopping, which will benefit Alibaba's position at the forefront of Chinese e-commerce.
Susquehanna maintains a Positive rating on BABA. Wall Street analysts, Quants, and SA contributors average out to Bullish to Very Bullish ratings.
Alibaba shares are up 3.2% to $274.20.
Previously: Cloud computing helps drive Alibaba's 34% revenue growth in fiscal Q1 (Aug. 20 2020)
Holding off on this till the FDA NDA is decided, Once decided this will either fall big to around 4 bucks or up to 12ish.
I'd say the entire AVDL board buying big blocks last week said a lot about the way they feel.
Had to cover a call on LLNW..not good.
It's been getting punched out lately.. thinking about buying my SP down a bit.
