U.S. Consumer Confidence Index Falls to 26-Year Low

yup....this will be remembered as the commodity bubble era. it will get worse.

 

but hey since you said bubble it will get better - bright side.

While you are here - what do you think of the strategy of selling short-term covered call rights a couple of ticks above the market price (which i just figured out how to do because i just figured out what they are) every time you buy long and simply letting htem expire?

obviously you can lose out on potential gains if the strike price is hit, but if it's a security that I realy want to hold at the long term, I can just put in a limit order over the short term for somewhere at or near the strike price and all I am out are the commission and I guess the short term cap gains difference. It seems like free money to me, but i haven't bothered to do the math on the tax and commissions.

 

Sammy:

If you've got a limit order above the strike price, won't you be triggering the exercise of the call? You're churning and burning yourself!!! Usually your broker does that for you.

 

It's a good thing you have the intelligence to recognize such things and the will to state it so plainly. I do find it curious that this revelation comes when it looks like the party you support is going to get shellacked in November, but that's another matter. No, we're here to celebrate your greatness... your towering intellect. It's almost as if stepped right off the pages of an Ayn Rand novel. Wait, that is how you think of yourself isn't it?

Rand:

"My philosophy, in essence, is the concept of man as a heroic being, with his own happiness as the moral purpose of his life, with productive achievement as his noblest activity, and reason as his only absolute."


Except for that last part, you're well on your way to being a heroic being in your own mind.

 

Gold has surged against all currencies but far more against the US dollar due to the weak dollar stance adopted since 2001. Bush has never vetoed a spending bill since he took office. Let me repeat that.....Bush has never vetoed any spending bill since he got up on the throne.

The Fed's printing of trillions out of thin air, explosion of M3, throwing away trillions in Iwreck, tax cuts for the top-tier - these are the forces driving up gold.

 

Oh yeah, duh, well wht I mean is to just buy it back as soon as it is excercised at or around the strike price. SO think of it as like a "mental note limit order" that is between me and nobody.

 

people who don't believe this war has anything to do with the dollar has their head in the sand. also giving away money a record low interest rates, yes, this administration has it hand all over our falling dollar.

 

Sam, do you see Warren Buffett trying to do that type of financial chicanery? No you do not. Your time would be better spent researching fundamentals.

 

hmm, sounds like you're holding some of my call rights, caveat emptor....

 

it's really not worth writing covered calls unless

1) the underlying stock has a high beta/volatility, meaning you can take in high premiums for the calls

or

2) you are going to use the premium to buy long puts as downside insurance for your stock position

or

3) you have at least several million $ worth of stock and therefore this strategy is a legit way of actually generating extra income on it

otherwise as another poster mentioned, you are just wasting your $ on commisions/slippage as well as your time and energy....furthermore if the stock moves quickly against you, your position will have been forfeited and you should have just never held the stock and taken that money to the mall/bar/strip club in the 1st place anyways....

 

to be fair......the Fed & Bush really have no choice......they must spend as much as possible in as many places as possible in order to avert deflation.....of course the Fed and every administrations since Nixon (except maybe Carter's) have had a helping hand in creating the mountain of DEBT mess which requires the spending in the first place.....but still you can't put on the blame on Chimpy...

 

thanks - for the record I'm not talking about doing a buy-write JUST for the purpose of collecting the premium, just periodically selling calls against my long positions (at strike prices that would represent a good short term profit on the long position) to pick up the extra $$.

 

This is a workable strategy if you have enough volume and have volatile enough stocks/indexes to make it work. I started using it a few months ago - and it sort of is "free money" if the stock/index stays flat - if it goes up, it's a bit more complicated. And you can repeat it every month. I wish I had started back in October or so, but alas. Where it doesn't work so well is if your stock goes up fast, but you can always roll over your call option.

For example, I did it with Bidu - bought the stock at $230 and sold call options against it at 260 for April for $10 - so my cost basis went to $220. Bidu then proceeded to skyrocket to $300 - so those gains are basically inaccessible for now (it's back to $285 now, but that's besides the point). If you want to dump the stock, you can take the $30 gain and be done with it. But if you want to hold on, you roll it over; a few days ago, I repurchased the $260 April call and sold $280 May calls for the same price.

So your gains are basically limited - but you can unlock them over time (I unlocked the $20 with Bidu, but now I have to hold until May expiration instead of April expiration). Where you really lose out is if the stock goes skyhigh and then comes back down - you wouldn't have the ability to gain those skyhigh gains. So if Bidu never gets back to $300, I'll have lost that opportunity. But if it's something you plan to hold long-term, it's great - if it goes up a lot, you roll over the option. If it doesn't, you let it expire and sell another option.

It definitely works better if (1) you have enough shares to overcome any commission issues and (2) if you do it with volatile stocks like BIDU as opposed to more stable ones. It also is easier to implement with cheaper stocks (ie, not BIDU) since you have to have 100 shares minimum to have the option covered.

 

Buffet has been short the dollar since 2002.

 

Buffet must hate America!!!

 

So you've got discretionary income to gamble on the derivatives market, but you have no money to donate to Clutch?



PRIORITIES

 

Absolutely. Charitable funds are best used for the truly needy. Clutchfans can be funded through clicking ads - kids in 3rd world countries can't. It's a much better use of resources to click ads here and donate to other charities. Unlike you, I don't need some tag that says "contributing member" to feel better about myself.

 

Sorry, but there is just no excuse for 9 years and 11,500 posts and not one red cent having been contributed to Clutch. I can't believe you would even try to rationalize that. Unreal.

 

Some of us understand the internet a tad bit better than you. You really should learn how it all works before speaking. It seems your priority is that we give money; mine is simply that Clutch gets the money. I think you're the one that has your priorities a little messed up. It's about Clutchfans - not you, and not me. If you want to take money away from people in need when there are much easier options to fund CC.net, that's your choice - I'll make a much more efficient one, though.

 

So you can't even scratch up $10 to give to Clutch? Is it just not worth it to you?