Here's today's entry:
In January 2001 our national debt was 5.9 trillion, and we now have a 70% rise to 10.3 trillion by the end of 2008. "My budget plan pays down an unprecedented amount of our national debt", Bush said in 2001.
Bush tax cuts are supposed to improve the economy and lead to surpluses, but we now owe collectively $120k per tax paying family. We are again spending beyond our means. 500 billion has been spent now in Iraq, our perpetual occupation, and this money could have been spent in health insurance, securing our ports and borders, and improving our own infrastructure. Does anyone know now how much was spent on our new Iraqi Embassy?
We are now more dependent upon foreign oil than ever before, with gas rising from 1.20 a gallon in 2001 to over 3.50 a gallon today.
The FEDS are now studying what was done with Norwegian banks decades ago, where banks were stabilized by Federal governments, and bail outs to shareholders (like we are seeing with Bear Stearsn) were not allowed.
Bad performance by banks there closed the bank, or forced the government to take over the bank. I believe we are not far from that now. What we heard yesterday with a FED overhaul was simple: the FOMC will control the banks, the largest financial overhaul in years. Right or wrong? This depends upon if you trust the government anymore than you trust a bank.
WASHINGTON (MarketWatch) -- Treasury Secretary Henry Paulson defended his blueprint to overhaul the nation's financial regulatory structure, saying Monday that initial reviews the plan amounted to less oversight of Wall Street were wrong.
"Those who want to quickly label the blueprint as advocating 'more' or 'less' regulation are oversimplifying this critical and inevitable debate. The blueprint is about structure and responsibilities -- not the regulations each entity would write," Paulson said in a speech formally unveiling his plan that was leaked to the media over the weekend.
Many analysts have suggested that the plan is regulation with a light touch.
Yesterday the higher risk put traders were able to move the April570P to 3.40 tops, and traders that had bought the April620C Friday, or Monday on dips, were able to trade from 9.40 lows to 11.80, and the position remains live, and open.
From trader PC from Germany, new to Advanced Mentoring: "Hi Floyd, I know you're flying today so I didn't attempt a blow by blow. Saw my 610C rise to 11.80. I bought at 9.50 after it opened at 9.10 and rose quickly. I placed a sell order for 14.90, well inside your 16.90
OEX was at 617.21. I recalculated intraday pivot point and found 614.53, R1 619.45.
I had calculated when OEX was 612.72 and found pivot of 611.67
So, with new pivot 614 having been passed and R1 not yet reached I hoped there might be another $2 rise. At this point, forced to leave the computer for half an hour, I came back to find my $200+ profit scratching $110 and was $20 in seconds, everybody say, Hmmm!! I am rather good at this trick.
It recovered to $70 and is now $40. Any suggestions for next step please?"
Two answers here:
1. If one could take a 2.00 profit on an option some traders would lock profits and close out inventory.
2. If one is holding for more upside, following the Dow projections, simply holding the position for another day is perfectly fine.
Second, an email from AM from Arizona:
"Floyd, I like the change to the alert and forcing me to do my own support/resistance and ATR calculations. You're dead right that current market conditions require more and more re-calculations. I use your alert like a "market bible" and print it out each morning prior to the market opening, and use it throughout the day, to remind me to check futures, to check the economic calendar, and now to calculate pivots and support lines through the day. Made 1.50 on the calls today!”
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