Markets Firm into the Bell

Strong markets like to go higher. The current state of the bear class is one of a disheveled, barbarous booze hound. These people have been broken to pieces, like stale pretzel sticks in the back pocket of someone riding a roller coaster.

Markets were barely off today, down by 24 on the Dow and just 3 SPY. Coming off a -150 early morning drubbing, I’d consider this to be a great success.

All eyes on Apple earnings now.

Party on like it’s 1929.

This is from a report penned on April the 22nd that is first being read now by the brain-sinks on Wall Street. Shares of the homewreckers are sharply lower on this ‘news.’

“This problem of rising bad debts continues to be a major issue in Macau, and is among the key drivers for the successive junket mergers and closures that we continue to see today.” Wynn and Melco hold the “riskiest slice of the industry’s junket business” because they have the most revenue among casino operators exposed to the high-stakes gambling segment, he wrote.

Personally, I’m a big fan of WYNN. It was the place we chose to host our first annual investors conference and it will always hold a sentimental place inside of my black heart. As for the morality of the casino business: absolutely horrid, almost as bad as offering legal counsel.

These companies had a great thing going in America, ripping off people in Vegas. But they had to get greedy and try to run their schemes in the totalitarian regime of China. WRONG move. Now they’re paying the price, in spades.

But alot of people already got very, very rich off the Macau scheme. I am sure these mountebanks will find a new place to hoodwink people and restore their glorious theft margins to new highs.

So let me get this straight, the CEO of PRGO, Joe Papa, is leaving PRGO in order to head up VRX. That makes sense, if you’re into lateral moves. But before Papa left PRGO, he blew it to smithereens.

In addition to announcing Mr. Potato Head was leaving the company, they also threw in an earning warning of the first magnitude.

PRGO Lowers FY16 EPS to $8.20-8.60 from $9.50-9.80 vs. $9.52 consensus. The majority of this change in guidance provided on February 18 is the result of a reduction in pricing expectations in our Rx segment due to industry and competitive pressures in the sector. The remainder of the reduction is primarily due to weaker-than-expected performance within the BCH segment for the next three quarters and lower expectations for consolidated new product launches.

The initial response to Mr. Potato Head joining VRX was one filled with elation. As the news sank in and people had a chance to mull it over, the stock began to give back its gains and are now lower for the day.

Meanwhile, shares of PRGO are getting poleaxed, off by 17% for the day.

Shares of PRGO are down more than 50% over the past year.

How glorious. The good tax paying folks at Morgan Stanley and Barclay’s are throwing meated loaf at the vagabonds who’ve been buying up crude these last few months. The nature of this rally has been nonsensical by ‘low-information’ players, regular Joe Schmoes, running about the market with money in their hands. It won’t take long before someone hits them over the head with an oil barrel and then takes their money.

“Non-fundamental rallies can last for several months and near-term catalysts may be lacking, but a macro unwind could cause severe selling given positioning and the nature of the players in this rally,” Morgan Stanley analysts said.

Barclays analysts said they were “not yet convinced that prices will remain here or go even higher.”

“Still-elevated inventory levels, the return of some disrupted supply, further boosts to Saudi and Iranian supply, and increased non-OECD product exports all have the potential to move prices lower over the next several months, especially if broader macro sentiment shifts,” they wrote.

‘Given positioning and the nature of the players in this rally,” said Morgan Stanley–whilst dusting their cigar ash onto the floor for the maids to pick up. Very nice prose.

Markets have halved today’s losses. Oil is near the lows, off by 2%.

Everyone is making a big deal about some asshole billionaire from China, mocking Apple for being antiquated and old hat. This coming from a country that steals everything and is unable to create anything without using nefarious methods is rich, to say the least.

But there is some truth to what the Chinese and others are saying. As a loyal Apple user for more than a decade, I am utterly demoralized from using the iTunes Store. It’s slow, wonky, fucking stupid, and it doesn’t have any cool features.

For example:  WHY DOESN’T ITUNES HAVE A SOUNDHOUND LIKE MUSIC IDENTIFIER? Why am I forced to use Soundhound to find the name of a song playing, forcing me to remember said song and then I am forced to type it into the iTunes Store? Do you realize how long classical music song titles are?

The fuck.

Also, and additionally, the iPhone is a huge piece of shit. Ever notice that? Just yesterday I was trying to offload a thousand pictures onto my computer. No luck. Fucker froze up on me, rainbow beach ball’d me, forcing me to walk away with a phone filled with too many pics and not enough memory space. For an additional bonus, it even nuked my wifi router.

The iPhone is a depressing piece of hardware. The software is indelibly worse off. The company is without a creative genius and instead stuck with an autocrat gay activist clown.

Analysts on average expect a decline in revenue to $52 billion from $58 billion a year earlier, according to Thomson Reuters. Earnings per share likely slumped to $1.99 from $2.33.

For the most part, this is Apple playing victim to its own success. The iPhone 6 and the bigger 6 Plus released in September 2014, make up Apple’s best-selling smartphone line of all time, and 2015 was the strongest year for the devices. In the second quarter, Apple sold over 61 million iPhones, and revenue in the unit jumped 54 percent from the prior year.

That makes 2016 a relatively slow upgrade year and presents particularly challenging numbers to beat. Gene Munster, an analyst at Piper Jaffray, said that the iPhone 6 was expected to produce a 15 percent sales bump over the iPhone 5 line, but it ended up being a 30 percent increase.

“The 6 really threw everything off,” said Munster, who recommends buying the shares and has a $172 price target, representing a 63 percent increase over Friday’s close. “When you’re pulling forward that much demand, you’re just naturally going to have a down year.”

Gene Munster is a fanboy. Here are the facts. Apple is going to post its first revenue deceleration in 51 quarters. Moreover, the iPhone 6 was a failure, solely judging by a stock price that has gone nowhere and seems to be waiting around for better news.

The Apple growth story is officially dead.

Don’t worry, the $538 bill expected to leave China this year is nothing in comparison to last year’s carnage, which saw  outflows brim over at $674 billion. Moreover, these are normal ongoings for the world’s second largest economy.  I wonder where all of that capital is going?

If this is such a great economy, why does the capital flee (extra Braveheart)?

“A sharp drop in the renminbi would likely spark a renewed sell-off of global risk assets and trigger a flight of portfolio capital from emerging markets,” the IIF said in a new report.
“Moreover, a sharp depreciation of the renminbi could lead to a round of competitive devaluation in other emerging markets, particularly in those with close trade linkages to China.”
For now, though, outflows are slowing. Roughly $35 billion was pulled out in March, bringing the total since the start of the year to around $175 billion, well below the pace seen in the second half 2016.

It’s because they are going to hell in a hand basket.

Stocks aren’t really down all that much. I am merely trying to send them lower via unwishful thinking.

iBankCoin is hosting its 3rd boot camp, starting the week of my birthday, on May the 23rd. The Option Addict will be hosting the event, who has been absolutely on fire this year inside of 12631 and Ahwoa. If you’re interested in his methods for finding great swing trades, I strongly advise you to give it a try. It’ll last for 5 nights, via webinar, and will be very interactive. Think of it as a hugely robust college course that can change your net worth.

Both crude and gold are higher this morning, so I guess wanton inflation is just beyond the bend. Also, the CEO of PRGO defected to VRX. What a lunatic.

Lots of interesting stuff happening today. Stay tuned.

I can’t remember the last time 83 of 100 Senators got together to agree on anything, let alone draft a letter to Obama. Israel wants more funding for its military. They’ll probably need it now that Obama’s friends in Iran have U.S. drone technology (courtesy of Obama) and ton of new money coming in thanks to the lifting of the sanctions.

Eight-three of the 100 senators signed the letter, led by Republican Lindsey Graham and Democrat Chris Coons. Senator Ted Cruz, a 2016 presidential candidate, was one of the 51 Republicans on board. The Senate’s Democratic White House hopeful, Bernie Sanders, was not among the 32 Democrats.
“In light of Israel’s dramatically rising defense challenges, we stand ready to support a substantially enhanced new long-term agreement to help provide Israel the resources it requires to defend itself and preserve its qualitative military edge,” said the letter, which was seen by Reuters.

Obama will be forced to act, with this bipartisan act. But you know damned well he doesn’t want to.

Monarchies are the worst form of government, even worse than dictatorships. These self entitled brats ruling Saudi Arabia, with their harems and private jets and solid gold cars, make any sane person disgusted by them.

Emter the 30 year old Crown Primce Mohammed, who is not only in charge of the countries multi trillion oil business, but also national defense.

Huh?

At any rate, he has a plan that will enable Saudi Arabia to survive without oil by 2020.

“I think by 2020, if oil stops we can survive,” Prince Mohammed said. “We need it, we need it, but I think in 2020 we can live without oil.”
As part of his Vision 2030 reform plan, Prince Mohammed said the state-controlled Public Investment Fund had been restructured to become a hub for Saudi investment abroad, partly by raising money through sales of shares in national oil giant Saudi Aramco.
“We restructured the fund. We included new assets in the fund, Aramco and other assets, and we fixed the problems of the current assets that the public investment fund owns, both in terms of companies and other projects,” he said.
“Initial data say the fund will have control over more than 10 percent of global investment capacity.”

Within 5 years, he’s going to implement a green card system that would permit for longer term stays in Saudi Arabia for those looking for work.

This is a move born out of stupidity and desperation. Rafael Cruz and John Kasich have agreed to team up in order to deny Donald Trump the republican nomination.

Have you ever seen such a thing?

Trump went apeshit on Twitter.

Trump is expected to win big in 5 primaries tomorrow, so this move is viewed as a Hail Mary of sorts.