Friday, February 19, 2010

2/22 Almanac

Monday, Feb. 22, is 25 days before March options expire, 53 the April and 88 the May.

Blue chip stocks (SPY) closed the latest regular session at $111.14, up 0.2% from the prior close.

In total, 3.2 billion shares were traded on the three major U.S. stock exchanges, up 6.7% from yesterday.


On the jump, mediawatch, rules, econ reports, portfolio and a good book...


Mediawatch: All stories focused on the Fed's raising of the discount rate from 0.5% to 0.75%. Jim Cramer says the markets were alarmed but shouldn't have been. Marketwatch says the markets they watch viewed the Fed move more favorably than initially. CNBC said the markets misread the Fed move. And the AP, with its native caution, said stocks moved higher after the Fed move.

What happened, of course, is that nothing happened to speak of after the Fed move. Trading has been well within the near-term range. But on days when nothing happens, market reports firmly hold to the old adage, "Propinquity creates causation."

In fact, I'm sure that if you were to ask any market reporter, "Does propinquity create causation," he or she would nod sagely while filing yet another story saying A happened after B and suggesting that therefore B caused A. Post hoc ergo propter hoc, as we used to say in the old days while quaffing a pitcher of Falerian wine after a hard day in the Forum.

My rules allow trades in March iron condors and covered calls, along with butterfly, calendar and vertical spreads. I allow myself to trade unhedged call and put option purchases that expire in May or later.

No economic reports will be released. Fed Chairman Ben Bernanke will appear before the House Financial Services Committee to discuss whether the economy needs further stimulus. (Hint: Look at your bank statement, look at your 401(k) statement, and help Ben find an answer. Send feedback to the Fedsters from this feedback page.)


"Janine Wedel has reinvented the study of public administration for an era of blurred roles and secret networks. Shadow Elite is a must-read for all who care about the future of government—even the possibility of decent government—in the age of flexians and truthiness." --James K. Galbraith.

My portfolio consists of . . .

March expiry:
  • AKS, iron condor, p19/-p20/-p25/p26
  • CAL, covered call, s/-c19
  • CSCO, iron condor, p22/-p23/-c25/c26
  • GCI, covered call, s/-c15
Shares for dividends: AOD, NLY.

Zombie shares: MCO, PALM.

Enjoy the weekend!




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Topics: S&P 500, SPDR, Spiders, AK Steel Holdings, Alpine Dynamic Dividend closed-end fund, Continental Airlines aviation, Cisco Systems networking, Gannett newspapers media, Moodys bond rating, Annaly Capital Management, Palm smartphone Pixi Pri.

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