Weekend Update

I had a hard time getting myself out of a deep blue funk in order to write this week's "Weekend Update."

No, not because of a gut wrenching week in the market, the week treated me just fine.

For you see, it turned out, as I awoke this morning, that I had not won the $640 Million Mega-Millons Grand Prize.

Forget the fact that I won a $2 voucher at the time of my ticket purchase and chose to cash it in rather than re-invest and forget the fact that I won another $7 by virtue of having 3 of the numbers,

Believe it or not, it was the $640 million that I'd set my sights on.

Sure, the $8 net return on the $1 investment was good, but still a far cry from real triumph.

But, not to let a good thing go to waste, I may pick up a few hundred million shares of Sino-Forest.

This past week, I actually started looking for the coming week's potential plays on Thursday and was hoping certain depressed prices would hold, because I was anxious to re-play some previous positions.

One of those was selling puts in Focus Media again, a distant relative to Sino Forest, although at some point we're likely to find out that the distance was never really terribly great.

Unfortunately, it only offers monthly options. Too much can happen between now and the three weeks until expiration. Equally unfortunately, it's one of those Chinese companies, so you never can really tell what's going on. But that is what helps to explain very enticing premiums.

If you dare.

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Winsome Wednesdays

I spent a good part of the day in a medical facilty and its waiting room today. and I'm not quite certain how to describe the fare that was playing on the communal, but grossly undersized overhead television.

Obviously I'm spoiled by both content and context.

It certainly wasn't what I was used to watching during the day, as local news production values leave much to be desired.

Unless I'm mistaken or still in some drug induced recovery mode, I think that one of the correspondents adorned in a plaid blazer was named Herb Grunberg and he was accompanied by Brian Mulligan and Candy Drury.

Other than perhaps being a bit more hirsute and much less intelligible, I guess I could learn to like them, if I was destined to spend the rest of my life in a Bizarro universe.

But my stay here was to be a short one. Sugar Momma made me promise, though, not to divulge why I was here, but I am at liberty to disclose that my efforts to perfect an Erectile Dysfunction drug that allowed you to wait 8 hours before seeking urgent medical attention went awry.

Seems that the calculation should take into account the amount of time that it takes to get to the facility.

But despite the utter boredom of the day, it was a welcome change from what is typically "Winsome Wednesday" which for me represents the low point of the week in terms of trading activity and meaningfully relevant news stories.

Lest you think that I don't know the meaning of the word "winsome," let its use just be refelctive of the fact that I was too lazy and unimaginative today to come up with some other word for alliterative purposes.

Yet, when looking for a change of pace, maybe boring Wednesdays are my definition of "winsome."

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Handcuffed, but not in a Good Way

I neither understand bonds, nor bondage.

Maybe it's just the fact that I'm not really wired to think in terms of inverse relationships.

Or any relationships for that matter. 

Although, maybe if I understood bondage better Sugar Momma would change her opinion about my understanding of relationships.

I do better with correlation. For example, I do understand that over the past couple of months, whenever Federal Reserve Chairman Ben Bernanke has spoken, it was a clear opportunity to make money by buying gold or silver before he spoke. Today was no different.

Direct correlation.

In the case of bonds (and currencies) I get confused thinking about whether I would want values going up or down. Just way too much thought seems to be necessary. Besides, I still have that belief that bonds are for the feeble and infirm and need to be held for a long time.

I have the attention span of a gnat and maybe the life expectancy, as well, so I really don't want to be overly involved with anything that's going to require me learning its name.

It used to be that if you held onto something for a long time, that was a good sign. You held onto winners and cut your losers.

Although I don't understand inverses, I do just the reverse.

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Weekend Update

It's really amazing that this past week marked the single worst one of 2012.

With now nearly 25% of the year having passed, we can look back and say that a 0.5% drop is the largest we have had. Hard to believe, given where we had come from.

Reminds me of the comment a neighbor made when we bought our new long haired miniature dachshund home for the first time.

"I have poops that are bigger than that thing."

That's what I imagine 2011 saying to 2012.

You call that volatility? I'll show you volatility.

The two big stories of the week were undoubtedly the debacles surrounding the IPO of the BATS Exchange and plunge in Credit Suisse's leveraged VIX product, TVIX.

In the case of the TVIX Exchange Traded Note, there is nothing but misunderstanding regarding pricing and the risk. The details regarding the general misperceptions around TVIX is really well adressed by Kid Dynamite, who is part of the StockTwits family of bloggers, that includes The Reformed Broker and James Altucher.

Not a bad bunch, despite the fact that Phil Pearlman, one of the founders of Stock Twits hasn't added me as a blogger.

Tell Phil.

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Apple Embraces Chinese Communism

We all know that corporations are people. The United States Supreme Court made that abundantly clear and the equally abundant political ads, courtesy of the Super-PACS are testament to the privilege of being a person.

Best of all, the beneficiaries of corporate largesse can wash their hands of all responsibility, as they must have an arm's length relationship with their friend, the Super-PAC.

It's so nice to be able to keep a straight face while totally disowning some egregious allegation or claim.

It may not seem as if its a privilege to be a viewer, but someone has to pay the price for someone else to have rights.

Apple is a person among persons. WIth a market capitilization is large as it is, it definitely warrants attention when it does anything.

Today it shook the ground enough to even get the attention of its co-founder, Steve Jobs.

The singular issue of the day was the Apple decision to offer a meaningful dividend and purchase back some $10 Billion in shares, which at its current rate of climb would be about 12 shares.

The certainly not something that Mao Tse Tung or his successor Mao Zedong, would have done in his lifetime.

In fact, the announced dividend, if paid in $1 bills that were laid end to end would circle the globe six times. If paid in Chinese Yuan it would also circle the globe sx times, but only because the size of their note is artificially pegged to our dollar's dimensions.

The truly amazing thing is that if you followed that trail of singles around the globe again and again, you'd likely never run into a single Research in Motion Playbook owner.

That fantasized fact may be somehow related to Apple's incredible recent success.

But how do you deal with such success, especially when the underlings get restless?

Just thrown a curveball, Apple has emerged unscathed as it turns out that the Chinese FOXConn controversy may have also been a fantasy. Apple has never been accustomed to being scrutinized or criticized.

In size, impact and imperiality, Apple is China.

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Weekend Update

If I do say so myself, the nice thing about my blog is that you really don't have to read it very often, because I'm constantly repeating myself. Imagine being married to me. Suddenly the unlimited supply of amusing stories and anecdotes reaches a limit, as long as your memory or hearing is intact

Best of all, this still being a free society, you don't have to read it at all, as long as you continue to pay the monthly subscription fee to have it delivered to your Kindle.

Imagine, just $0.99 a month to have it electronically delivered to your e-Book reader.

I think Amazon should adopt the old Telephone directory strategy for having an unlisted number and charge $2.50 a month to not get the blog delivered to your Kindle.

But if you have been reading on a regular basis you'd know that I've been bemoaning the fact that so far in 2012, I've been trailing the S&P 500.

Ever since I've been doing this dogmatic approach to covered call writing I'm not accustomed to seeing myself behind the eight ball.

The real kiss of death probably came when Barrons Magazine called the covered call strategy the only winning one for 2011.

It's exactly the same as when TIME magazine puts something hot on the cover.

It fades and fizzles.

Or like when Sugar Momma finally got herself an iPod Mini.

The day that she gives up her Kindle and exchanges it for an iPad is the day I start shorting Apple shares with every last bit of my soul and portfolio.

But finally, this week was back to normal, though not in trading activity. I still made relatively few trades this week. Having made such few trades, some dumb ones, in hindsight, really stand out.

Like grabbing a few pennies by selling calls on all of my Research in Motion holdings on Thursday, the day before shares inexplicably go up 7%.

I say inexplicably, because the purported reason was first given that there was some sort of Samsung alliance rumor, which was then followed by the contention that the fact that RIMM didn't offer a "profit warning" report had to be a very positive sign.

I don't know very much about SEC rules, and by that I mean that I don't know anything, but are they required to give profit warnings?

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Price Points

I really don't know anything about "Price Points."

I'm certain that there's a fairly well established discipline that melds economic theory with behavioral science to explain at what point people will be spurred into action.

Call it cost/benefit. Call it risk/reward. Whatever.

I'm not much of a consumer, but I do occasionally get feelings that have to be requited.

Oh, and I buy things, too, sometimes. That desire tends to be inelastic, as opposed to the diminishing elasticity related to the other desires.

I'm not really certain that I've ever been intrigued to buy an item from a retailer just because it dropped its price, other than that DiGiorno Pizza and chicken combo that was on sale a few weeks ago, yet wasn't last week.

Last week, I chose not to buy it, as I made a decision, on some level that's not entirely clear to me, that the cholseterol hit wasn't worth the retail price du jour.

Or is it Di Gior?

Actually, it wasn't the sale price that got me to buy it initially. In fact, prior to that day, I'd never tried one of their products. It just happened that on the day in question the product was prominently displayed and the price seemed reasonable. I never had any idea what the usual price was.

Best of all, both the pizza and chicken actually tasted good. Despite the fact that I'm very far removed from my Bronx roots, I really enjoy good pizza and accept both the short term consequence of heart burn and the longer term consequence of death.

There must be some kind of price point buried in there somewhere, especially when it comes to those longer term considerations.

What I discovered today, though, was that there was a clear price point for my "Option to Profit" book.

Until about 12 AM PST today, you can get it for free to read on your Kindle.

Amazon must know what they're doing, because in just the first 8 hours, more people have demonstrated that their price point is "free," at least when it comes to what I'm offering.

That seems odd, not because there's any great value to what I'm offering, but because at the very same time, for some inexplicable reason, people are signing up to get this blog delivered to their Kindle. They're willing to pay a monthly fee for what they can read for free, or more than likely, choose not to read at all.

This shouldn't come as a complete surprise, since a couple of months ago, the book became enriolled in Kindle's lending library program, where Amazon Prime members could download the book for free.

Free.

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Case of the Mondays

I spent more than my usual share of time this weekend re-watching old movies on Comedy Central.

If you read yesterday's blog, "Market Crashers," you'd already know one of the movies. Despite what your mother may have said about how TV will kill your brain cells, I find it useful for creative inspiration. Besides, that's much easier than having to actually interact with anyone.

Although I have no doubt that I am beginning to lose some of those brain cells, I'll never pin it on my viewing habits. One of the really great things about starting to lose some of those brain cells is that regardless of how many times you see a movie or a show, somehow it still manages to surprise. I'm sure that I've written that before, but even then, it's still funny, in a poignant sort of way, to me.

See what I mean.

That was also the case watching the cult classic "Ofice Space," on Comedy Central, the cable station where commercial failures go for new life.

It probably works out that way because it's really hard to smoke weed in the movie theater during the first run of movies that go on to become cult classics. It's also hard to make it to the theater if you started smoking weed beforehand, thinking that the weed is way overpriced at the concession stand.

The cult, in case you didn't know, smokes lots of weed. There's no other plausible explanation for why the mere mention of "TPS Reports" elicits spasms of laughter.

Right.

As opposed to much of the world, and definitely the downtrodden characters in "Office Space," I always look forward to Mondays. In fact, even when I was a contributing member of society, I had nothing against Mondays.

These days, the only Mondays that I don't care for are the Federal holidays, with all due respect to dead Presidents, laborers and others deserving of retail sales events. It's all simply because the stock markets are closed.

Otherwise, Mondays are like a re-birth.

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Market Crashers

I wasn't always a creature of habit. Although I could never have been accused of wantonly dipping into the deep end of the pool, I wasn't totally closed to the ideas of trying something new. It's not that I feared the new and unknown, it's just that there was so much comfort and security in staying with the tried and tested.

Danny Kaye, comedian and unlikely movie star from the 40's had a great joke about the immigrant who used the only words he knew of his new country to order the same thing at the diner every day for 5 years.

"Coffee and donut."

The joke is too long to tell here and the accent very difficult to emulate, but you could probably look it up. Anyway, the punchline also happens to be "Coffee and donut."

The fact that I get upset when even a 30th run of The Simpsons or COPS is pre-empted on a weekend evening, though, is still upsetting to my routine.

Obviously, I'm mature enough to understand that social obligations should be spared my indignation, but is there a reason why we can't all just "early bird" everything?

This weekend was yet another of those that COPS wasn't where it was supposed to be. I know that I could probably have trolled through the cable channel universe and come up with some 24/7 COPS network, but I needed it to be on my usual station. Afterall, I only have about 4 channels in my universe and the same number of buttons on my remote.

Instead, there was some bizarre show featuring Jennifer Lopez and the guy she used to be married to, on some kind of adventure to discover talent in Latin America.

And so my limited channel surfing took me to Comedy Central and I settled in on watching 2005's "Wedding Crashers."

I had completely forgotten just how funny that movie had been, although admittedly earlier in the day I'd also forgotten that I had left the neighbor's cat in the microwave.

After finishing the movie, I'd come to the realization that the misunderstood and artistically brooding brother of the family, "Todd" was a character that completrely channeled Christopher Walken's portrayal of "Annie Hall's" brother "Duane" almost 30 years earlier.

If I were a real artsy sophist type, I'd venture an opinion that the oncoming headlights shining on Woody Allen's frightened face in that memorable scene were in contrast to the darkness that emanated from within Duane.

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Weekend Update

This has been a busy week, but not so much for me.

It figures that on the week that the blog begins its apperance as an offerng by Amazon Kindle Subscription services that I would miss two days worth of blogging.

But only in America can you choose to pay for a subscription service to have a blog delivered directly to your Kindle when you could just as easily opt to not read the blog online.

And for free.

What really doesn't figure is that there are actual subscribers.

First of all, special thanks to Tony Vahl of The Original Daily Skew for authoring a guest blog this week. I had enough foresight to arrange for that, but not enough to consider the fact that I might be somewhat under the weather. So much so, that I barely even made trades for two days and when I did, I think they were through the lens of a Percocet fueled analyst.

As if I ever practiced any form of analysis.

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