We posted this last night but did not show up.

We will have more after the close.

 

By Gary Kaltbaum- February 28, 2018
First thought and message to the president…the #1 rule of people management is when praising, praise loudly and profusely! The #2 rule is when criticizing, criticize quietly and privately. We don’t think the president read the manual on this. If you treat your people badly, why would anyone else want to work for you?
Second thought…who said this about our debt and deficits? “Not a near term risk!” Yup, arguably the #2 money guy in the world, our new head of the Fed thinks everything is just fine. $21 trillion of debt is not a near term risk. $1 trillion deficits each year is not a near term risk. Every day, $3 billion being added to our debt is not a near term risk. In the coming year, the first $400 billion of our tax dollars goes towards interest and that’s not a near term risk. And who said this? “Not a supporter of a balanced budget!” Yup…the same dude. Feel better now!
Third thought. The “ping pong” market is now in force as price now bounces back and forth in a wide range. The problem is that the rally was very narrow and that narrowness is coming back to haunt the market. Except for the NASDAQ and NDX, all major indices are back below the 50 day with some never getting above. In fact, areas like the NYSE, TRANSPORTS and SMALL CAPS look downright horrid. The best areas remain the mega-cap tech/internet that has a major influence on the NASDAQ/NDX. Lose those big names and get the fork. Need to add Europe much worse than us. We had better not play catch-up. At the very least, it is going to remain a tough proposition as the market’s complexion has definitively changed.
Fourth thought. The Knicks stink. The Rangers stink. The Giants stunk. Next up…the Mets. Not feeling better!
Serenity now!

PRE MARKET AND SOME NOTES

A few thoughts in and out of the market:

Immigration:

Not one person will be deported out of DACA. Not one.

The coins:

Kodak (KODK) announces a coin. Goes from $3.10 to $6.80 yesterday. Trading at $11.50 this morning. But there is no bubble!

Notice many of the other “questionable” blockchain/coin stocks have been slaughtered. Do not be the last one in.

Trump:

That was one hell of a one hour meeting in front of the cameras yesterday. That was Trump telling all the famed psychiatrists like Dr Mika and Dr Joe that everything is fine. As always, you decide.

Tax bill:

More and more bonuses. More and more wage hikes. More and more investments. While, as we wrote yesterday, a company like Tim Hortons takes away because of mandated higher wages by government. Repercussions!

The markets:

Continue to watch COMMODITIES. Energy, oils, steel, copper, aluminum, palladium…all continue to soar. Gold and silver also getting a bid. Energy prices are at 2 year highs. We have been told the ultimate outcome of all the central bank nonsense of printing of trillions, negative rates and 0% rates for 8 years has to be a good bout of inflation. Has not happened yet but always keeping one eye out as we do not believe economics 101 is dead…regardless of central bank interference.

Watch long rates. On the verge of breaking out of near-term range. If successful, watch 10 year head towards 3%…the highs going back to 2014.

Sentiment and complacency remain at extreme levels while major indices are at extreme extended levels. Just saying! Also, just saying…we will get a correction eventually. No really.

PRE MARKET-EARNINGS ROULETTE

Tons of jello moving on the plate this morning. In no particular order but of course, we start with Apple.

Apple (AAPL) beat estimates in a quarter before a big roll out. At the open, AAPL will be gapping out of a 12 week sloppy base. This is the 2nd strong gap in 6 months. The one in January worked well. We have been told a second big gap to the upside within a year is a “be careful” sign. We’ll let the market decide.

Because of Apple, NDX futures up over .5%. Interestingly, S&P futures basically flat. DOW futures up but that’s on Apple. Apple suppliers like CRUS, QRVO, SWKS and others are up.

ILMN gaps up to a high…up $19.

Other gaps to the upside:

ALL, GRMN, CRTO, HUM, PZZA.

On the downside…WOW!

COHR down $35 off the highs…ULTI down $29 off the highs. MTSI down $13…leading SEMI off the highs…PXD down $14…

Smaller but decent sized gaps to the downside: BGFV, HLF, FISV, AN, RIO, SSTK, FARO, RMD, MRCY, VMC, RACE, CAH, DLPH.

Enjoy! Earnings roulette continues.