Wednesday, December 01, 2010

1 December 2010 The Flap Heard Round The World

BAGAKOAA 1 December 2010 The Flap Heard Round The World

Somewhere in China last night a butterfly flapped its wings of optimism and caused a Tsunami of positive sentiment around the world (Well, except in some parts of Europe who just do not know how to have a good time.) and the end result was a great day in the market. This is one in a row, again. The butterfly wing flap, of course was the manufacturing news out of China. It came in much stronger than expected. That was support by relatively positive other global news (like a better than expected take up of Irish bonds-though they had to reward those buyers with high returns) and eventually the global Tsunami hit our shores and like those ridiculous “waves” at stadium games, we kept the energy going with a sting of positive news in our economy. The ADP job reports came in strong. (Careful ADP is only private sector. Friday we will see how many city, county, state, and federal jobs were displaced and see that the “NET” actually is.) The ISM manufacturers survey came is strong. And the feds Beige Book had 10 of the 12 cylinders hitting. (There are twelve districts and 10 reported solid growth and two reported flat.) So as a result, we got to see a 249 point increase in the DOW and a 25 point jump in the S & P 500.

So now what do we do. First, before I had some dental work done this morning. My dentist came in the room at one point and said, “Ok, time for some impressions.” To which I replied by putting my hands over my head with the V victory sign in each hand and shook my novacaine ladened jowls and said, “I am not a crook.” In my best Richard Nixon I could muster. Then I said, “How about John Wayne as a brain surgeon, ‘Well Pilgrim, looks like we’re gonna have to yank it outta there.' Then I said, “Your turn!” But I digress. Before my dental appointment, I had a little pin action in the Salve Lucrum portfolio.

First off I must apologize about picking up some OTVI options yesterday on a quirky e-maill about stocks in play. I gathered some Dec 18 dollar call options for 1.90 each. It reported very strongly and had some analysts upgrades and we saw those options jump 77% today. We had to take the money and run. Our net was 69%. Now I did move quick on that one late yesterday and I am sorry I did not get to tell you. I did not do my normal homework and got really lucky, I can show you about 11 other options that have big bad red numbers next to them at the moment.

As an offering of forgiveness, here are few other equities we either picked up today or played options on. Do your own homework as I did not do due diligence on these YET.

April 70 dollar call options on BIIB Biogen Idec Inc., a biotechnology company, develops, manufactures, and commercializes novel therapeutics in the areas of neurology, oncology, immunology, cardiopulmonary, and hemophilia in the United States and internationally.

Feb 15 dollar call options on NEWP Newport Corporation develops, manufactures, and markets technology products and systems to various industries worldwide. The company operates in two divisions, Photonics and Precision Technologies (PPT), and Lasers.

March 40 calls on CAH Cardinal Health, Inc. provides health care products and services primarily in the United States. The company's Healthcare Supply Chain Services segment distributes branded, private-label medical and laboratory, generic pharmaceutical, healthcare, and consumer products to retail customers, hospitals, and alternate care providers.

March 5 dollar calls on AVNR AVANIR Pharmaceuticals, Inc. focuses on acquiring, developing, and commercializing novel therapeutic products for the treatment of central nervous system disorders primarily in the United States and Canada.

April $57.50 calls on MHS Medco Health Solutions, Inc., a healthcare company, provides clinically driven pharmacy services for private and public employers, health plans, labor unions, government agencies, and individuals in the United States and internationally.

Mar 30 dollar calls on RES RPC, Inc., an oil and gas services company, provides a range of oilfield services and equipment to the oil and gas companies primarily in the United States.

It looks like I spent like a drunken sailor. I may have. Here are a couple more that look like they may head in the right direction. I do not own these and have not done the homework. Just giving you something to think about.

FNSR Finisar Corporation designs, develops, manufactures, and markets optical subsystems, components, and network performance test systems for high-speed data communications in the United States, Malaysia, and the People's Republic of China, and internationally.

ZUMZ Zumiez Inc. operates as a specialty retailer of action sports related apparel, footwear, equipment, and accessories in the United States. It offers apparel, including tops, bottoms, and outerwear, as well as accessories, such as caps, belts, and sunglasses; footwear consisting of athletic shoes and sandals; equipment, such as skateboards, snowboards, and ancillary gear, such as boots and bindings; and other items, such as miscellaneous novelties and DVDs.

EXPR Express, Inc. operates specialty retail stores in the United States. Its stores offer apparel and accessories for women and men between 20 and 30 years old across various aspects of the lifestyles, including work, casual, and going-out occasions, as well as provides gift cards.

Tsunami Warning

So there you are, you see the tell signs of a Tsunami coming at you.  What do you do?  Fortunately we have a friend in the surf industry.  Her name is Holly Beck.  If she were to see a Tsunami headed her way like we had today in the stock market, I’ll bet she would . . . .
She would just go with the flow!

Salve Lucrum


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