The Investment Thread (5 Viewers)

[efil4stnias]

AAL consolidated hard around $14.90. If we get just a little turn up then it could run into the 15.50 area fast. Have my stop in at $14.84. I'll usually take 3-4 5-6 cent losses then suddenly it'll pop and I'll get 50 cents. I'd rather short it but don't trustthe WH making an announcement with some insane stimulus program whether true or not.

had this exact convo this am with friend. Between current admin looking to move the market daily, algos/ai, the rise of the novice retail investor ( Robinhood - btw - Robinhood is the name they chose for a trading platform??? Can ya be any MORE obvious??? ) So many new variables to consider DAILY not weekly....DAILY that can move the market in large chunks. Big players LOVE to squeeze the shorts too.

We are Noon EST. market around 3068 SP ( down 122~ ) and DOW down 1230~

Lets see what happens by 1pm EST. If we are staring at 1230 and 122 area still, closing 30 min may not be fun.

And dont think the WH aint paying close attention.

 

[bclemms]

Household net worth decline last quarter is worst ever. It's more than the stimulus.

 

[bclemms]

had this exact convo this am with friend. Between current admin looking to move the market daily, algos/ai, the rise of the novice retail investor ( Robinhood - btw - Robinhood is the name they chose for a trading platform??? Can ya be any MORE obvious??? ) So many new variables to consider DAILY not weekly....DAILY that can move the market in large chunks. Big players LOVE to squeeze the shorts too.

We are Noon EST. market around 3068 SP ( down 122~ ) and DOW down 1230~

Lets see what happens by 1pm EST. If we are staring at 1230 and 122 area still, closing 30 min may not be fun.

And dont think the WH aint paying close attention.

Oh, they knew it was coming, hence the announcement from Mnuchin day before yesterday and Kudlow getting on CNBC yesterday. You can pretty much bet your arse when Kudlow gets on CNBC to tell you how great the markets are it is because we are headed for a waterfall. That 3200 mark was massive. When money started flowing back into QQQ and people started making fun of Buffet while buying up Cherokee, Hertz and Whiting it was a pretty good indicator. When we closed below 3200 yesterday it sealed it. Question now becomes, where will the support catch? There are quite a few support levels in the SP so it's not this huge air bubble but all of them are weak for quite a ways down.

 

[Tapxe]

had this exact convo this am with friend. Between current admin looking to move the market daily, algos/ai, the rise of the novice retail investor ( Robinhood - btw - Robinhood is the name they chose for a trading platform??? Can ya be any MORE obvious??? ) So many new variables to consider DAILY not weekly....DAILY that can move the market in large chunks. Big players LOVE to squeeze the shorts too.

We are Noon EST. market around 3068 SP ( down 122~ ) and DOW down 1230~

Lets see what happens by 1pm EST. If we are staring at 1230 and 122 area still, closing 30 min may not be fun.

And dont think the WH aint paying close attention.

Is it a game the mkt is playing with the admin? They've got to know serious sell off's like this in an election year for an embattled PoTUS will force the Fed to do everything possible to prop up the economy. IDK, just spitballin and idea that occurred.

 

[DaveXA]

Household net worth decline last quarter is worst ever. It's more than the stimulus.

Yea, the one time $1200 stimulus is a joke at this point. We're staring down the end of the UI benefit and when that goes away, CV19 will be on the rise again and we're gonna be in a world of hurt come August and September. I just think people are not taking any of this seriously enough. What really needs to happen is a minimum monthly stimulus to keep people from completing drowning when the bills start piling up and they can't keep up.

A slow moving trainwreck we're about to witness here imo.

 

[superchuck500]

Market is up >300 points, but the VIX is also up over 1.5%. Given how much the market has run up, I suspect that most of that increased volatile option activity* is on the down side. I would guess that traders are setting up for an episode of profit taking (or even a correction).

This turned out to be quite an indicator.

 

[Saint_Ward]

Household net worth decline last quarter is worst ever. It's more than the stimulus.

Did they say why? Wage loss or housing value drop?

 

[Saint_Ward]

Is it a game the mkt is playing with the admin? They've got to know serious sell off's like this in an election year for an embattled PoTUS will force the Fed to do everything possible to prop up the economy. IDK, just spitballin and idea that occurred.

I don't think you can get that many people on board with the same plan. I think smart money just was happy there was a run up and is cashing out and the Fed put a whole lot of cold water on people.

 

[Tapxe]

Just looked and happy with my choice to go stable. Up 1.5% since Dec despite the mkt drop. Just waiting for the right time to jump back and ride it up again.

 

[DaveXA]

Did they say why? Wage loss or housing value drop?

Interestingly enough, take a look at the Las Vegas housing market. It's a mess right now and values are rapidly dropping, much like it did during the housing bust during the last meltdown.

There are tons of foreclosures on the market in Vegas, and that's never a good sign.

 

[Saint_Ward]

Interestingly enough, take a look at the Las Vegas housing market. It's a mess right now and values are rapidly dropping, much like it did during the housing bust during the last meltdown.

There are tons of foreclosures on the market in Vegas, and that's never a good sign.

Honestly, if my job stabilizes, I really do hope the South Florida housing market drops hard.. I'd love to buy.

But, my rental has a brand new AC and new water heater.... and has great hurricane shutters. Also, I talked my landlord down $100/month on rent, due to the getting put on part time. Probably could have gotten more, but I didn't want to push it. She's a nice older lady.

 

[Saint_Ward]

From Fidelity on DAL...

Airline Stocks Are Sliding Because Delta's Debt Looks Dicier -- Barrons.com
BY Dow Jones & Company, Inc.
— 12:40 PM ET 06/11/2020

Airline stocks continued their tailspin Thursday after Delta Air Lines ( DAL)

		warned in a filing that it is seeking to renegotiate debt and a credit-ratings firm warned of "negative implications" on some of Delta's debt.

S&P Global assigned a BB rating -- below investment grade -- to Delta's proposed issuance of $1 billion in senior unsecured notes and placed the debt on a "CreditWatch with negative implications." S&P said that investors could expect to recoup 35% to 50% of their principal in the event of a default.
Ratings agency Fitch assigned a similar BB+ rating to the unsecured notes, which Delta is expected to use to bolster liquidity. "Given Delta's rising debt balance, Fitch views the company's headroom within the 'BB+' rating as diminished, and future ratings downgrades are possible should recovery prove slower than Fitch's expectations," Fitch said in a release on Thursday.

Shares of Delta were down 8% in trading amid a broad market selloff. The NYSE Arca Airline Index was also down 8%, as constituents such as United Airlines Holdings (UAL) and American Airlines Group fell about 10% each.

Delta's financial position isn't as precarious as it was a few months ago. Revenue is picking up with the summer travel season. The company has cut operating expenses by more than 50% since the start of the crisis, and it's reducing daily operating losses from $100 million in March to an expected $40 million a day by the end of June. Delta also has ample liquidity, expecting to have more than $14 billion at its disposal at the end of June.
Delta "still retains more financial flexibility than some peers," Fitch noted. Delta has funded its pension plan through 2024, deferred $500 million in pension payments this year, and deferred more than $3 billion in planned capital expenditures. It has also stopped dividend payments and buying back shares, outlays that cost $3 billion in 2019.
Delta's credit is rated higher than its other big legacy rivals, United and American, reflecting Delta's "more conservative financial policies, better leverage metrics and operating margins," according to Fitch. But Delta is still rated three notches below Southwest Airlines
Fitch said, since Southwest has a longer record of sustained profitability, free-cash-flow generation, a lower cost structure and no pension obligations.

Investors appear to be growing nervous, however, that airlines are adding to debt loads without seeing enough of a recovery in revenue. The stocks have been declining for days, following a dire outlook issued by the International Air Transport Association and bearish calls by some analysts noting that the valuations have gotten ahead of fundamentals.
Granted, passenger traffic through Transportation Security Administration checkpoints has been picking up for weeks, gaining momentum through the Memorial Day holiday and into the first week of June. Analysts expect traffic to continue building through the summer due to pent-up demand for leisure travel.
Allegiant Travel (ALGT), a budget carrier focused on the travel market, reported Wednesday that it is seeing steady improvements. The company said it flew 362,000 passengers in May, up tenfold from April, when just 36,000 passengers took flights on the airline. Allegiant's load factor -- the percentage of a flight with ticketed passengers -- jumped to 47% in May from 19% in April. And higher load factors came with more flight capacity as Allegiant added flights in the first week of June, taking its schedule to 70% of last year's flights, up from 50% in May.

Yet investors now appear to be looking beyond a summer bump to prospects for traffic to recover in the fall. That will require higher demand for business and international travelers, which so far appears to be slim. Longer term, airline load factors will have to improve well above 50% for the industry to return to profitability. That isn't expected to happen this year or next. And rising debt loads and interest payments only make it tougher for airlines to restore financial health.
Write to Daren Fonda at daren.fonda@barrons.com

 

[efil4stnias]

Is it a game the mkt is playing with the admin? They've got to know serious sell off's like this in an election year for an embattled PoTUS will force the Fed to do everything possible to prop up the economy. IDK, just spitballin and idea that occurred.

No the market aint playing no games. The Admin trying to, but the market is US. those that see right thru understand that this last 2 weeks of "yay opening, whoo hooo gettign back to normal" crap was going to be short lived.

Same reason i took profits Monday on BA, SPG and WYNN. Now playing w/ house money and they cant get that profit i took back. BA im down $1 from buy in level...SPG and WYNN still up good. But im getting ready to jettison my positions in those i think. Not going to get caught up in this crap again.

 

[efil4stnias]

and it doesnt look like we are getting any buyers. Dont see any momentum building. May get some news to placate/mitigate, but i dont know if that would be enough to turn big Mo.

 

[B4YOU]

From Fidelity on DAL...

Airlines will dump employees on Oct 1 if they are still only flying 20-25% of past passenger loads. The total industry workforce of 750,000 in Jan 2020 could be halved. UAL has already said they will cut 30% of their workers. If DAL was around $60 pre-Covid, then I would think it's value should reflect the reduced passenger load of 20-25% or a $15ish price. I think the April bottoms for airlines are where they should be. I just don't see air travel being a thing in 2020.

Airline employees' dilemma: Take severance or gamble on Oct. 1 layoffs

Airline employees have been left to debate whether to take buyouts or early retirement or risk getting laid off on Oct. 1.

www.cnbc.com