December 21st, 2014
Published Daily

Posts tagged as:

NASDAQ

Rick’s Picks occasionally offers option trades suited to novices and experienced traders alike. Typically, these gambits go against major trends, since our proprietary Hidden Pivot System is especially useful for nailing turning points very precisely.  Yesterday, for instance, we recommended buying QQQ June 65 calls if this proxy for the Nasdaq-100 index fell to within a dime of a 63.53 price target. That implied a wicked plunge from  the previous day’s settlement price of 64.76. In the actual event, panicky sellers obliged by pounding the bejeezus out of QQQ on Tuesday. It opened 43 cents lower, at 64.33, on its way to an intraday bottom at 63.48 – just a nickel from the low we’d projected.  This allowed us to buy June 65 calls for as little as 0.98; however, we used an official price of 1.03, since that was the worst fill reported by a subscriber in the Rick’s Picks chat room. » Read the full article

We wrote here recently that as Apple shares go, so goes the U.S. stock market. How has the stock fared?  Last week there was quite a bit of excitement when the broad-tossers who manipulate the stock for a living short-squeezed the bejeezus out of it after the close, leveraging a strong earnings report that could have surprised only Wall Street’s clueless analysts. Moments after the news hit the tape, AAPL gapped up 9% in a blink, recouping two-thirds of the losses it had suffered the previous two weeks, when it plummeted $90 from an all-time high at $644.  From a technical standpoint, what was interesting about the  decline is that it reversed from within 29 cents of a “Hidden Pivot” correction target we’d disseminated to subscribers a few days earlier. For if the stock had exceeded that number by more than a couple of dollars, it would have held bearish implications for the short-to-intermediate-term. However, because the pivot survived, there was no way to judge the mettle of bulls until Apple rallied out of the hole. » Read the full article

Dot-Com Greed Knew No Bounds

by Rick Ackerman on January 20, 2012 5:25 am GMT · 6 comments

[We wrote the following column for the Sunday San Francisco Examiner a month before the dot-com bubble burst in March 2000. Overnight zillionaires were a dime a dozen back then because countless investors couldn’t wait to pay practically anything for the shares of unproven companies. Nowadays, billion-dollar scores on Wall Street are much rarer, but as the lucrative IPOs last year for LinkedIn and a few other purveyors of Vaporware II demonstrated, enough greed and stupidity still remain to make canny stock-promoters rich. RA]

It’s said we are separated from the rich, the powerful and the famous by a chain of no more than six friends of friends. This means that if you are looking for a job in the White House, or a way to meet Winona Ryder, it should take no more than half-a-dozen phone calls to get in the door. But I’m beginning to wonder whether it would take even that many calls, on average, to reach a friend of a friend with eight-figure net worth. There seem to be so many of them around these days. More than lottery jackpot winners, as far as I can tell. Although I personally know a dozen guys who have reaped spectacular riches from stocks in the last few years, I’ve only known one big-time lottery winner in my life — “Bunky” W., who wrestled heavyweight for Atlantic City High School in 1967. » Read the full article

[We used to think Nobelist Paul Krugman was the Looniest Economist in America, but Rutgers professor James Livingston recently emerged as a solid contender with an absolutely dumbfounding op-ed piece in the New York Times that said, essentially, that America’s wealth has come mainly from Government spending and consumption, not from savings and investment.  In the essay below, we give our friend Edward Furst, a member of Young Americans for Liberty, a rebuttal opportunity. RA]

We all know that the New York Times isn’t exactly a bastion of free-market thinking. But a recent op-ed by Rutgers Professor James Livingston, a guy who makes Paul Krugman look like Milton Friedman, went beyond the pale of economic sanity.  His basic contention is that economic growth comes, not from private investment, but from “consumer debt and government spending.”  Livingston points to the increase in per capita GDP over the last century despite the relative atrophy of private investment as a percentage of GDP, the growth in government spending, and the general increase in consumer debt. Here we encounter the age-old conundrum of historians unschooled in economic thought (Dr. Livingston has a bachelor’s degree in British and American literature, a masters degree in Russian history, and a doctorate in American History). » Read the full article

Where would you invest $76 billion if you had it?  That’s the size of Apple’s cash hoard at the moment, and it would appear that they have no better idea of what to do with all that money than you or I.  Apple isn’t the only company with this “problem,” if you could call having a mountain of spare cash in the bank a problem. According to Standard & Poor’s data reported by the Wall Street Journal the other day, the 500 largest U.S. companies alone currently hold cash or cash equivalents that totaled $963 billion at the end of the first quarter, up from $837 billion a year ago.  Tech companies in particular are glutted with cash they apparently cannot use. Microsoft’s got $60.9 billion sitting around; Google, $39.1 billion; and Cisco, $43.4 billion. What’s a company to do? Traditionally, high-tech companies have shunned paying dividends because shareholders expect the companies to use the cash more aggressively for growth. But the likes of Apple and Google have been growing plenty fast without dipping into their so-called war chests. Come to think of it, maybe they should start a war with China, Europe or Brazil.  Hasn’t war always been good for business? As for the excuse that they need to hold cash in case a great acquisition opportunity comes along, Apple, Google and numerous other NASDAQ world-beaters could borrow all they want for next to nothing, at any time.  » Read the full article