One and Done

Yikes. I think he’s toast at this point. I couldn’t watch it past the first twenty minutes. I was live-tweeting from my iPhone on my sofa, and this pretty much tells the tale: The ES zoomed 8 points higher based on his performance so far (from a -5 deficit to over +3 now). It’s a […]
Slope of Hope

Some questions from a European trader learning US markets

One of our SMBU students visited our desk in NYC from Sweden today. Merritt, from SMBU Trading Conversations on Friday 1:30PM EST, joined us for lunch, as did this trader’s dad. This European trader is a graduate of SMB DNA and The Winning Trader and working on his game, after work hours from Europe.

There were two issues that arose during lunch that merit discussion:

1) What trades do I take with a limited ability to watch markets?
2) How do I settle on the best stocks to trade during Earnings Season?

What trades do I take with a limited ability to watch markets?

For this trader I like:
a) Changing Fundamentals Read more […]
SMB Capital – Trading Education

Boston Lyric Opera’s Carmen

This is the last week for the Boston Lyric Opera’s production of Carmen. Six of us went on Sunday afternoon and were favorably impressed.

What is the point of a regional opera company? Grab a recording from the 1970s and you can hear better singers. For that matter, what is the point of a national opera company? Grab a video from the 1970s and the singing and sets will be just as good. Why pay $ 100+ per seat for something that can be streamed for pennies?

The Boston Lyric Opera’s current production, which will be performed a couple more times this week, actually adds a lot compared to what opera companies were doing in the 20th century.

The text of the opera is all about “love” and yet the characters are intimately involved with each other after only the briefest of acquaintances. The BLO asks, via the action on stage, “What if it is really about sex?”

The men on stage are constantly trying to get sex from the women. The women, even those just entering adolescence, are constantly trying to get cash from the men. When the men aren’t getting what they want they resort to physical force. When the women aren’t getting what they want they resort to lies, deception, and cunning.

The BLO reminds the audience that the opera has only two characters that might conceivably be considered virtuous. There is the on-stage Micaela, Don Jose’s fiancé from the village, and the off-stage sainted mother of Don Jose. Everyone else is corrupt, with the men willing to do almost anything for sex and the women willing to do almost anything for money.

Staging is kind of minimal and relies heavily on some classic Mercedes cars that are rolled around by the actors. This is an idea that I haven’t seen before. If you put old-style (non-radial) tires on a car it is quite easy to push, fills up a good portion of the stage, and lets the actors do a bunch of dramatic stuff. Compliments to the BLO and San Francisco Opera (it is a joint production) who thought of this expedient. Certainly the opera set designers of the 20th century were working way too hard.

See also

Philip Greenspun’s Weblog

Emini Slicing Down through our Fibonacci Grid Sept 26

If you’re not using our Fibonacci Grids each morning, you’re missing out!

Be sure to bookmark our homepage and check back each morning for free updates to our grid and quick-planning for you day.

We’re seeing the fall down away from our 2,170 level through the heart of the grid as we’ll see in a moment.

Here’s today’s updated Fibonacci and Emini (@ES) trading levels for your plans and trades:

Here’s a reference guide of how to use and trade from these morning updates.

We’re back to where we started BEFORE the Fed failed to raise rates last week (and the market surged).

Look carefully at the highlighted areas at 2,157, 2,148, and now 2,139 – all of which came into play on the fall.

For today’s session, we’re laser-focused on 2,140 and will play the bullish or bearish movement AWAY FROM this newly achieved pivot.

Want these levels and additional strategy planning in advance each evening?

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Corey Rosenbloom, CMT

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Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).

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The Good Old Days in Turkey

Peter the Great: His Life and World explains life in the Ottoman capital:

But in the seventeenth century, Constantinople was the capital of the Moslem world, the military, administrative, commercial and cultural hub of the mighty Ottoman Empire. With a population of 700,000, larger than any city in Europe, blending many races and religions, it was studded with great mosques, colleges, libraries, hospitals and public baths. Its bazaars and wharves were piled with merchandise from every corner of the world.

Inside this city 5,000 servants fulfilled the sultan’s needs. The sultan’s table was presided over by the Chief Attendant of the Napkin, assisted by the Senior of the Tray Servers, the Fruit Server, the Pickle Server and the Sherbet Maker, the Chief of the Coffee Makers and the Water Server (as Moslems, the sultans were teetotalers). There were also the Chief Turban Folder and the Assistants to the Chief Turban Folder, the Keeper of the Sultan’s Robes, the Chiefs of the Laundrymen and Bathmen. The Chief of the Barbers had on his staff a Manicurist who pared the sultan’s nails every Thursday. Besides these, there were pipe lighters, door openers, musicians, gardeners, grooms and even a collection of dwarfs and mutes whom the sultan used as messengers, the latter being especially useful for attending the sultan during confidential moments.

In rooms where the sultan might wish to speak confidentially to an advisor, there were fountains so that the sound of running water would keep the wrong ears from hearing what was said. The harem was a closed world of veils, gossip, intrigue and—at any moment of the sultan’s choosing—sex. But it was also a world rigidly ruled by protocol and rank. Until the time of Suleiman the Magnificent, sultans had married; the Moslem religion permitted them four wives. But Suleiman’s wife, a red-haired Russian woman named Roxelana, had interfered so much in matters of state that thereafter Ottoman sultans did not marry. The sultan’s mother, therefore, became the ruler of the harem. The Turks believed that “heaven lay under the feet of the mother,” that no matter how many wives or concubines a man might take, he had only one mother, who held a unique place in his life. Sometimes, when the sultan was young or weak, his mother issued orders in his name directly to the grand vizier. Beneath the sultan’s mother ranked the mother of the heir apparent if there was one, and then the other women who had borne the sultan’s male children. Finally, there came the odalisques, or concubines. All of these women, technically at least, were slaves, and, as Moslem women could not be enslaved, it followed that all the harem women were foreigners: Russians, Circassians, Venetians, Greeks. From the end of the sixteenth century, most came from the Caucasus, because the blue-eyed women of that region were renowned for beauty. Once she passed through the harem doors, a woman remained for life. There were no exceptions.

More: Read Peter the Great: His Life and World 

Philip Greenspun’s Weblog

Sully, the movie

While out at the Reno Air Races a pilot friend and I saw the movie Sully.

Spoiler alert: there is a plane crash in the film.

While watching the movie there were some things that made me curious…

Did they really land off-airport with only partial flaps extended? That would result in a higher impact ground speed and, given that energy goes up as the square of speed, much more impact energy for the airframe to absorb. The full transcript from the cockpit voice recorder indicates that Flaps 2 was indeed used.  The NTSB report confirms this and has a section (page 90) titled “Decision to Use Flaps 2 for Ditching.” It was in fact probably a bad idea, especially given the tailwind that further increased ground speed, but the NTSB points out that nobody has done much experimentation landing Airbuses on the water.

I knew that sim pilots had been able to land the plane back at LaGuardia but had they really been able also to make it to Teterboro? And did ATC suggest 1 at KTEB rather than 19 or 24? I.e., suggest that pilots without engine power fly a leisurely downwind leg before turning around to  head north on Runway 01 (runway numbers are shorthand for magnetic heading so 19 is approximately a 190 magnetic heading and 01 is approximately a 010 (north) heading)? The transcript confirms this seemingly bad suggestion. The NTSB report, page 50, says that Airbus simulated attempts to land on Runway 19 at KTEB and that it was successful only once out of two tries given an immediate reaction to the engine failure.

The movie shows New York City’s finest not hanging out in a donut shop discussing what to do after a retirement with full pension at age 40. Instead, the police are hanging out in a building right next to a continuously spinning Huey helicopter. Thus they are able to make it to the accident site and a rescue swimmer jumps into the frigid Hudson to heroically save a female passenger who had become separated from the herd. This heroic validation of the rescue helicopter and NYPD is absent from the NTSB report, which instead credits the New Jersey ferry boat sailors. (See Government versus private industry helicopter operating costs for what happens with your tax dollars and helicopters in the NYC area.)

The jet type rating training that I’ve had stresses using the autopilot’s Indicated Airspeed mode following a dual engine failure. This way the plane is guaranteed to be at the best glide speed (also close to the minimum sink airspeed; planes need more power to overcome drag when flying close to the stall and therefore if there is no engine power a slowly-flown airplane will sink like a rock) even if the pilots are distracted by running checklists. The movie shows Captain Sully heroically taking the controls and hand-flying the airplane. This seems to be historically accurate but the chosen

My big take-away from the movie is the lack of credit given to the engineers of that Airbus A320. The plane was presumably designed to withstand being ditched (a) into the wind, (b) with full flaps, and (c) at a minimum sink rate airspeed. Instead it was slammed down with a high vertical speed and roughly twice as much forward energy. Yet the plane did not break up and sink. Also the engineers protected the pilots from stalling. Like a panicked student pilot, Sully had the yoke way too far back fro the last 150′ of the flight, but the Airbus envelope protection software kept the plane from stalling (page 97-98). Of course it might be that Sully knew that the Airbus programmers wouldn’t let the plane stall and therefore this was a feature rather than a bug. On the third hand,  Sully said that he was trying to maintain the Airbus-recommended “green dot” Vls speed from the airspeed tape (page 56), not hover right above a stall. See page 120: “The captain’s difficulty maintaining his intended airspeed during the final approach resulted in high angles-of-attack, which contributed to the difficulties in flaring the airplane, the high descent rate at touchdown, and the fuselage damage.”

What about the idea that it is reasonable for pilots to ponder the checklists for 35 seconds before taking action? That is definitely consistent with the airline culture (see below for a link to an accident in which 35 seconds stretched to an hour and the airplane ran out of gas). On the other hand, Julia Link was flying a recently overhauled Robinson R-22 helicopter when the engine quit. If she hadn’t reacted within about 1.5 seconds she and her passenger would have been dead. Instead she lowered the collective, entered an autorotation, and landed on a Honolulu street (NTSB report; TV news). Her photographer passenger got away with a scratch.

The movie features Captain Sully as a psychologically tortured man, kind of like Owen Wilson’s pitch to female guests in The Wedding Crashers. Yet one of our local instructors experienced an engine failure in a Cirrus SR-22 (I prefer the SR-20 partly for this reason; the lower the power of a piston engine the less likely it is to fail), deployed the parachute, and walked away (WCVB news). I saw her the next day going out with a student in a Cirrus SR-22 (not the same one!). She never complained to any of us about psychological torment. (On the fourth hand, she has five kids so presumably she had to get out of the habit of complaining about anything…)

[I wasn’t curious about the fact that the NTSB investigators were hostile and that everyone on the FAA payroll turned out in some big public hearing because I already knew that the NTSB stuff in the movie was fiction.]

Readers: What did you think of the movie?


  • United Airlines 173, in which a three-person flight crew (two pilots plus a flight engineer to handle the cerebral tasks) runs a functional DC-8 out of gas due to the lack of a gear-down confirmation light.

Philip Greenspun’s Weblog

Golf Loses a King

Arnold Palmer died last night at 87. For those readers who never saw Arnold Palmer hit a competitive golf ball and believe that Tiger and Phil are the “old guys” of golf, please watch one of the tributes to golf’s first superstars and its greatest ambassador. Although he didn’t win the most tournaments or even win every major title, Arnold Palmer advanced the popularity of professional golf more than any other by bringing the sport to the masses with his appealing style of go-for-broke play and late round “Charges”. He was appropriately nicknamed “The King.” “The King” is dead and we will likely never see another like him.

He was a huge business success during and after his professional career ended. He was the first to earn $ 1 million in tour earnings, but he surpassed that by a factor of 100 in endorsements and his golf course design business. Outside of golf, he endorsed products he actually enjoyed and used, which made him a genuine pitchman. Investors can learn from this as well. Trade what you know is an old recommendation from Wall St. legend Peter Lynch. This still serves investors well today.

Last week, we had the much anticipated September FOMC (Federal Reserve Open Market Committee) meeting and though there were dissenting governors the decision was made to leave the overnight Fed Funds interest rate range unchanged at 25-50 basis points. The markets responded favorably gaining about 1% for the week and the tech heavy Nasdaq composite average actually closed at a new all-time high on Thursday. Weakness on Friday has carried over to Monday’s pre-market session as futures are indicating a weaker open this morning.
The big event this week is tonight’s eagerly anticipated first Presidential debate between Donald Trump and Hillary Clinton. If nothing else, it should be entertaining, with the uncertainty of what might come out of his or her mouth. It is very unclear what the actual market impact of tonight’s theater will be, though I bet whatever the market direction Tuesday holds will be attributed to Monday night’s blunders or successes.

On Tuesday, an OPEC and Russia meeting in Algeria begins and the talks may have an impact on oil prices and energy companies – rumors of agreements on production cuts cause rallies while no agreements sends crude prices lower. API Oil Inventory numbers will be released after the market close Tuesday afternoon. This meeting will conclude on Wednesday.

Janet Yellen, the Fed chair, also will be on stage this week with testimony before Congress on Wednesday. This testimony is on supervision and regulation rather than on sharing her economic outlook, so the market’s reaction is expected to be muted.
The 3rd quarter of the calendar year comes to a close on Friday which means earnings season will begin in earnest shortly thereafter. Also, September, which has historically been the worst month for market returns, will come to a close. Sure enough, after a summer of very little volatility, September did provide some “excitement” midmonth with 1% daily moves. For the month, however, we are only about 1% lower.

Golf Lose a King

Source: OptionsHouse

Get the popcorn and have fun with the debates tonight!

The post Golf Loses a King appeared first on OptionsHouse.

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Mixed Pheelings

Ahoy there from seven miles above California. I am winging my way back to my cherished Palo Alto, having enjoyed another weekend of fencing tournaments in which my beloved children did very well, thank you very much. As you know, I am terrifically excited about the first debate on Monday night. My dear son and I […]
Slope of Hope