With the dog days of summer fast approaching, we wondered whether every small-town newspaper in America is entertaining readers these days with the same sort of lurid stories that fill the Boulder (Colorado) Camera. Boulder is not exactly the kind of place where you’d expect to find luridness in newsworthy quantities. Half the people who live here are trust-fund babies who, one would surmise, spend their days hiking the local trails, writing letters to the editor, or working diligently to protect the rights of prairie dogs. Since these folks mostly lead quiet, unexceptionable lives, it must be the other half of the population that keeps turning up on the police blotter — or still worse, in the local morgue.
Today’s dead-man story concerned a 19-year-old graduate of Fairview High School (my wife’s alma mater) who OD’d on something called – if you haven’t heard – poppy pod tea. This ultra-hip beverage contains opium, and although it is sold via mail order and over-the-counter, there is evidently enough opium in poppy pod tea to kill someone who drinks too much of it, especially when it has steeped for a long time.
Death by Tea
This was the second poppy-pod tea fatality in Boulder this year, the first having failed, apparently, to convince at least a few dopers hereabouts that the risk of death outweighs the pleasure of a good high. In both cases, the victims drank the tea, fell asleep, and never woke up. Yesterday’s incident was deemed sufficiently newsworthy (i.e., lurid) to go out on the Associated Press A-wire, so you may have read about it in your own local paper.
In other Boulder-area sordidness, a six-car wreck on Highway 36 was reported after a few barrels fell off a truck and the driver tried to retrieve them. What made this otherwise mundane traffic story sordid was that the driver didn’t stick around to commiserate with the victims. He is now a hit-and-run suspect, his capture and incarceration an event eagerly anticipated by reporters and readers both. Ironically, the most lurid item in the paper was good news, reported as follows: “An 11-year-old boy was spared from giving excruciating testimony at a court hearing Tuesday when the man charged with sexually assaulting him two years ago suddenly decided to plead guilty in the case.”
If this is the kind of stuff that fills the news quota in Boulder, Colorado, for Pete’s sake, then what are they reading about in places like Newark, Detroit, Los Angeles and Miami?
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Hi, Rick. I appreciate your many wise comments and suggestions. For the benefit of us who are newbies however, could you explain (a bit about) selling options after you’ve bought them in a different month. How is this done? I’m specifically referring to your recent pick on SLW, options of which I bought. I should say that I follow this stock as I have a profitable position in their warrants. Thanks again.
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Selling (shorting) options against those you hold is simply establishing a spread. We do just two types of spreads — calendars and verticals — almost always by doing the “buy” side at one time, then the “sell” at another. In Silver Wheaton, the position was initiated a couple of months ago by buying September 10 calls when the stock fell to a downside target. Then, when SLW rallied, we sold an equal number of June 10 calls short. Just before they expired, we covered (bought back) the June calls for less than we’d sold them for, reaping a profit on the calendar spread. At the same time, we shorted July 10 calls, effectively rolling into the September 10-July 10 calendar spread. When the July calls expired last week, we covered them for almost nothing (0.05), then waited for a rally that allowed us to short August 10 calls. Each time we rolled the calendar spread in this way, keeping the September 10 calls the whole time, we collected more premium. Now, we effectively own the spread for a credit of 0.90 — what we have taken in cumulatively on the short June, July and August 10s. RA