No Free Lunch

I received the following email “advertisement” this past week after Bernanke spoke:
“Fed Chairman Ben Bernanke Drops the HAMMER!
*** "This is the worst labor market since the Great Depression." ***

*** "The market remains weak, with the overhang of vacant or foreclosed houses ... ***
 
*** "...uncertainty about the outlook for growth and unemployment as greater than normal....." ***
 My Friends, This Market is Fragile and can CRASH ANY DAY
NOW. 

This is a DIRECT WARNING from the FED CHAIRMAN.

 It can not be more clear! I warned about this LAST WEEK! 

 I'll Tell you "What To Do
Right Now to PROFIT BIG. Options that can skyrocket 300% 400% even 700%
800% or more.
This time around Cash In on the Turbulence, Cash in on the Crash with a small cash outlay.”

As I read the above jibber jabber I thought this might be what the Pee Party reads and believes and I simply am awestruck that a company would attempt to advertise so deceitfully, ready to let people lose thousands of dollars “dreaming of the 800% return.
Instead, Iʼm jumping up and down on our play with Mosaic Calls that are up 49% from purchase in a 5 day period. MOS SEP 18 2010 45.00 CALL we just recommended, and itʼs up 33% as of Friday, and hit 49% highs the day prior. We consider returns like this EXTRAORDINARY, meaning truly out of the ordinary, and not to normally be expected in most trading.
Reality. There Is no such thing as a free lunch. As Malcolm Gladwell teaches us one becomes an expert at something with 100,000 hours of work at it.
We did this a few months ago with our TLT call that hit 60% returns, albeit a long call that we had bought, and most traders sold out. Some may still hold, and the option is in the red. There come the nerves of steel, as there are another 6 months in this option.
And we hope to do it now while we think the market will rise short term, and we will begin liquidating some more of our holdings, locking profits, as the longer term view of the market is that it will end.
The debt the world has built up over the last 30 to 40 years is essentially “being liquidated”; the house of cards coming down.
Keynesian economists will steer us that the ongoing debt will essentially recycle and by itself creates no danger, as long as growth continues.
Others see it as the debt of the world eventually collapsing, not overnight, but over a tell telling time of high unemployment, homes being rented more than bought, and people working into their late 70ʼs. All of that time the dollar will be collapsing, but actually the dollar will be increasing.
The value of companies, the way we trade to create market share, this many think will end in just a few short years, and that there will be no stock market as we know it, no trading as we have it, and values having been changed. A perfect example of a “rock is not hard”.
As we trade options, we trade for fast profits. As we have traded stocks weʼve often bought on dips, but will not be doing so now, but instead selling for profits at various market tops, ALWAYS leaving money on the table for someone else to make. Rockefeller made his money by selling just before the top, and my Dad taught me well to always have a regret that I could have gotten more, because with the gains I got I could watch as the market or stock went “just a bit higher”, leading to GREED.
It confuses all of us. For example, Floyd here got us out of the Gold and Silver market when gold hit 1170-1180 ranges, and we missed the trade range increases to 1280. But as Gold has fallen we bought back in, and Iʼm not sure I should have recommended Gold. From a contrarian perspective I see tops no higher than 1270, and soon leading to lower lows For the short term. Gold may NOT be the frenzy.
Silver, however, should be, and to most is not even noticed. We own SLV and CEF which holds silver billion.
Here are recommendations to our portfolio:

Decrease or do not buy more of GLD.
Increase your position in SLV, the counter index for Silver to Gold. In Blue Chips we own Silver, in three ways: a.through Canadian Exchange Fund, (CEF), that holds both gold and silver bullion b. through SLV or SSRI, both excellent Elfʼs c. through shares of the Pan American Silver Fund (PAAS)
This play is a stock, and making trading news:
“Shares of Pan American Silver Corp. edged up $0.33 (+1.44%) to $23.25. The stock closed at $22.92 in the previous trading session and opened today at $23.18. The price of the stock ranged between a low of $23.04 and $23.67 respectively. The trading volume of 702,941 is below the 90 day average volume of 1,193,300 shares. PAAS is trading below the 50 day moving average. The stock's 52 week low is $18.11 and 52 week high is $28.41.”

Letʼs watch PAAS. As it shows upward trend near $25.00 this is an excellent buy as a stock or a long term call option.

Now to clear your mind of the sadness of our world, the news bites of false facts, here are some REAL ones to help us understand our transition as a human race.

*BP contributed 77,051 to Barack Obama through 2004­-2009.
*The average American paid 17% of their personal income in taxes last year, the lowest since 1971.
*There were 116,782 immigrants deported during Emperor Bush’s first year in office; Obama the communist has only deported 387,790 immigrants.
*Five finance firms hold 97% of the cash derivatives on the market.
*49 states have laws making certain physical appearances legal to have companies not hire the individual. It is said that Pee Party members are scrambling to find this in the Constitution.
*17% of all Catholics believe in the “evil eye”
*There are 23 nuclear reactors being built in China
*IN 2009 52% of U.S. personal income came from wages, and 17% came from horrifying socialistic government programs. Since 1929 these figures have never been so low and high. So, I’m asking all Pee Party folks holding their Constitution in hand, pray to their God (Christian only, I think, allowed in Pee Party, as in constitution, and voluntarily offer to give up their federal programs to “do the right thing”. Simply denounce your public library, public schools, social security, Medicare, and all else that we have wrought.

Be Well and Do Good
Trade for the right reasons
Floyd

Floyd, the Trader

In our ongoing portfolio commentary, beginning with last Monday’s alert, we’ll first finish up on the holdings, charts and spreadsheets all updated on the website.

Principal Financial Group (PFG)
We think one of the best run of the insurance giants, a quiet giant.
Buy. 25% trailing stop loss.

MTN Group Ltd (MTNOY)
For fun feel free to do your own due diligence on this newly recommended international telecommunications trade.
Buy, using a 25% trailing stop loss

Oracle (ORCL)

This is a long-term speculative trade; we think is the best positioned in the tech field,
as the sector shifts . Long term we believe we have the right stock.
Buy. 25% trailing stop loss

Johnson and Johnson (JNJ)

As soon as we bought in all the news was announced on bad product, packaging, and the brand name of all time became tarnished. We saw the initial recommendation decline 11%, and as we had said “buy, buy, buy”, we bought again at lows and will continue to. A strong dividend and brand name that will overcome this quickly, and bounce back.
Long term speculative hold, using a 25% trailing stop loss.

Panera Bread (PNRA)

When we sold slimy YUM Brands recently for 60% plus profits, and knowing we already held the slime of slime, McDonalds, Panera Bread charts as a break out stock, and is a superbly run restaurant chain.
Buy as a speculative position, using a 25% trailing stop loss

National Fuel Group (NFG)

This is also a new long-term speculative purchase. It’s another method of distribution of core commodities, and worth your review.
Buy. Accumulate. 25% trailing stop loss, in a speculative portfolio.

Monsanto (MON)

The next sector growth play we think is in “soft commodities”, which in the agricultural world means chemicals, pesticides, potash, and shit.

Monsanto has hit a real bottom, with its patent rights gone on its moneymaker pesticide this year, but sells many things, and performs many services.
We bought MON and have continued to recommend within decline, and are now about 3% off .
Accumulate. 25% trailing stop loss


Our recent recommendation on a call on Mosaic MOS SEP 18 2010 45.00 CALL
were spot on. Investors required the second larger buy on this position but hit 34% profits over a week ago.
As we recommend options, remember-SELL at your risk level. For some a 34% return is superb, and for others, they will hold closer to expiry and follow the charts.


The only other sector not covered in our portfolio takes a unique conversation.

We have owned, and do own TIP, the government inflation bond, and we have played TLT calls regularly reaping 35% returns in days with no losses.

Both TLT and TIP remain sound investments long term, to just hold and buy, and short term, to trade on the momentum as these currencies shift with and against the EURO and GLD and SLV


We remain active in review of AIG and TOY. We would like to buy QABA below $20.00My comments will be in bold black, and are to lead you to more questions and answers.



The first step in trading is the identification of personality type, your core “character logy”.


The next step is to let your subconscious just open a bit to your conscious, by taking honesty in, and not “I want or “make up” stories to yourself about whom you are.





From Charles Nenner Research, the Netherlands stock prophet that used to analyze for Goldman . He spoke on CNBC last Wednesday.
*************************************************************************************************

“The Blue cycle line that signaled the prior highs and lows is topping again
This is the reason that we exited long positions when the S&P reached 1200
The very long Red cycle that bottomed in 1990 is now turning down
It bottoms only around the year 2025
This is the reason that we expect a continuation of the overall bear market for many years, with several up moves along the way”



We must recognize that Nenner uses algorithms and cycles to foresee the market and is probably best predicting what we already know. We’re phucked.


Here's what the stock chartists tell us about the massive drop:


-- STOCKS MOVE SHARPLY LOWER TO AFFIRM RESISTANCE ZONES
-- BREADTH INDICATORS REMAIN BEARISH OVERALL
-- RISING EURO WEIGHS ON GOLD

-- GOLD BREAKS WEDGE SUPPORT

-- VOLATILITY INDICES TEST IMPORTANT SUPPORT ZONES

-- ELLIOTT WAVE COUNT SHOWS THE S&P 500 IN WAVE 4

 AN ALTERNATIVE ABC CORRECTION AND SUMMER RALLY


At Blue Chip Options we are not considering 25 year periods, but do recognize and believe there will be far fewer “stocks” to invest in that “win”, and that the market will take years to sort itself out of what it did, and what those behind it continue to do.


At Blue Chip Options I've been recommending watching Gold and Silver for months, and we sold our position at 1170. We've just re-entered with Gold and Silver and will watch this. We may have entered too early and that we have more downside to surprise us.

We believe we will have an alternative ABC correction and a summer rally. Our bullishness is short term, but truly there. We see more upside before downside short-term, and more downside than upside long term (6 months).

Friday was indeed a feeding frenzy of downside, lightened by Apple hitting the stages at 1 pm. and telling the world that only 165,000 have complained out of 3 million sold, that all smart phones do this, and that we have created frenzy.

People want Apple to fail, because Apple is successful. People always want to find fault with success.
I own this product and watched with amazement at what a feeding frenzy it has become, when almost every Smartphone has the same problem, and suddenly this is “news”. Lobbyists played Apple, or the human psyche did…..upset that a company could seemingly do “no wrong”.
We’re bullish on Apple and own AAPL OCT 16 2010 290.00 CALL.

We are also bullish on the right Blue Chips, which are bargain priced.

Accumulate IBM, ORACLE, MON, MOS, and any blue chip that is bargain priced.

We will close our weekly commentary with two new recommendations.

1. -BP101016C36
BP OCT 16 2010 36.00 CALL
Buy at up to market. Best buy at 4.85 or less.
Hold and accumulate on any large market dips.
Use a stop loss of $31.00 and sell to 49.00

This is only for high-risk traders

2. Buy Google. (GOOG) Complete our vision. We own ORCL, AAPL, AMZN (both in calls) and think that Google has not lost a bit of its focus, just a bit of attention has softened its profile.
Barron’s this week surprised me with this being their primary recommendation. They are in good company with old Floyd, who recommends it as a core holding using a 25% trailing stop loss.
Buy at market and accumulate.

We will watch for a call on GOOG in the near future.

Here’s partly why. Viral marketing is our future, and GOOG will lead in the producer of the product, AAPL in the display, and ORCL in being ORCL

Here’s the first genius viral marketing:



http://blog.entrepreneur.com/2010/07/lessons-from-the-old-spice-man.ph



Do no harm. Question authority. Question all facts. Do not trust people that want to force their beliefs on you. Be Well.