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The Neumann scum were truly brilliant. Dumping this piece of crap and becoming billionaires, leaving the disastrous financial apocalypse to everyone else. It’s stunning to me that Marc Andreessen actually poured a third of a billion bucks into this guy’s NEXT venture (“Flow“)
Super microcomputer (SMCI) has been the happy beneficiary of the AI lunacy all year long. Until today. I wish I could say I was short this, but I’m not. Nonetheless, it’s heartwarming to see the past two months vanish instantly.
It isn’t that often that I have anything meaningful to say that isn’t tethered to a chart, but I’d like to offer a couple of items today. These sound silly, but they are meant as a serious attempt to be helpful. Here goes…….
Fifty options contracts is better than ten. Ten is better than five. And five is way better than one.
Seems obvious, right? But my point is that I’ve often found myself with very conservative positions (many months until expiration, very deeply in the money) and thus will wind up with a small quantity of contracts. They may do all right, but no matter how big the move, they’re not going to move the dial that much.
What I realized recently – – and I know this is a “duh” moment, but bear with me – – is that a large quantity of shorter-term, less-in-the-money contracts can move the dial in a big way. Of course, this is a two-edged sword, but the whack-on-the-side-of-the-head moment for me has come in the form of my XLU position, which has a very large number of contracts and is really producing great results. So I’m starting to seriously shed my portfolio composition of pee-wee sized quantities.
(more…)The CPI report on Thursday might be a snoozer hitting expectations of 0.2 percent. If it comes in higher, bears might gain an edge on the market by looking at the Cleveland Fed’s model and crude oil moving forward.
I’ve been following the Cleveland Fed’s Inflation Nowcasting model for the past year. It hasn’t been terribly accurate, consistently coming in on the high side as disinflation kicked in. The past two years of data shows they lag the trend as shown by this chart from MacroMicro. The Cleveland Fed’s model is consistently low when inflation is rising and consistently high when inflation is falling.
