1/x The market continues to try & shake out weak hands from overextended positioning by both HF & Retail...After a strong Vanna run up overnight, as expected, retail exuberance exploded on the open in the form of retail call buying, this fragility, paired w/a)Mean reverting flows

1/x ‘Twas the night before Christmas & all through the market not an order was stirring not even for $TGT.
The bonuses were entered into payroll with care,
In hopes that next year would bring a similar fare;
The Bulls were nestled all snug in their beds;

2/x While visions of $TSLA danced in their heads;
& Biden in his Covid mask, & Powell with his still flowing money tap,
Had just settled their brains for a long winter's nap,
When out on the screen there arose such a clatter,
All sprang from their beds to see what was the matter.

3/x Away to their monitors they flew like a flash,
Tore open their Bloombergs & threw up the dash(board).
The S. Claus rally in markets, that all of us know,
Paired w/vaccine reopening, Gave a bid to the market, leaving old prices below,
When what to their wondering👀 did appear?

4/x But a Georgia runoff rushing up to them with complacency, not fear...
With once reliable Vanna flows no longer lively & quick,
They knew in a moment the markets might get quite sick...
Unexpected, 2 Georgia Dem peaches into Congress they came,

5/x Whistling & shouting they called for more fiscal, ‘CARES Too’ its new name:
"Now, Healthcare! Now, Infrastructure! Now Green Energy & Protectionism!
On, Labor rights! on, Minimum Wage! on, Basic Income & Populism!
To middle class households, To the poorest of them all!

1/ Vanna’s a widow maker... waging war with her & Gary is exhausting... we were able to take a textbook short at 3803 and take a profit On half at 3771. We will look to add more in a similar way on tomorrow morning’s likely vanna rally again... looking for exuberance once again

2/ in that 9-10am CST window. The growing chorus of bulls emboldened by Vanna’s continued support the last few days gives me confidence that this opportunity will be there again. W/Gary & Vanna behind them the retail exuberance is rising to a fever pitch. This is exactly what we

3/ want to see. But what happens when their backup is gone?? Who’s going to buy this market at these increasingly higher levels this week. Better yet who’s going to buy it @ lower levels when they are forced to sell next week? Not Vanna. She’ll be @ the beach. It ain’t cool bein’

4/ no Jive Turkey so close to Thanksgiving (OpEx)... Bear Steepening of the yield curve took a breather yesterday & so did the stair steps, which was a bit discouraging, no 2 ways about it. But those pressures are far from over. But... remember w/ Vanna still at 1/2 force SPX was

5/ still just unchanged. W/out EOD vanna flows where would the market have been yesterday? The NDX generals continue to be violently shot 1 by 1 as the rotation continues. The last generals will be BTC & TSLA. Watch them closely... listen closely into the rally. The fear of Covid

4/x keepers are calling in the Fed(s) (Fed/sec) for some help getting the animals back under control, so they can feed Gary & get the zoo back under control. As they are likely giving guidance to the brokers to get this under control, as every major retail broker seems to be

5/x restricting trading in the short squeeze names to closing only. The Wheel of Fortune has a taping on Fri & w/out Gary at his best the show will be overrun by the animals. If they can make it to the EOM & keep Gary above the 20 day, calm him down & start feeding him,vanna will

6/x be back & should be able to nurse him back to his usual self & save the show. But there’s a lot of time between now & then & holding the animals @ bay until then seems like a colossal task. Given the pop in Ivols & backwardation of the curve, when vanna gets back she will be

7/x refreshed & in preelection form. The only question is will the animals be so out of control so as to not even be managed by Vanna in her best shape.. This decline fits into a narrative that I’ve had brewing for 4 months, that after a monster run since Sep this is a healthy &

8/x reasonable time to expect the animals to be tired of being caged up & want to blow off some steam. All the biggest wall of worry narratives have been solved 1 by 1. Sentiment & bullish positioning was at all time highs. Hedging activity was low. Breadth was deteriorating. W/

1/x The window we have been targeting for 2 months has officially opened... i Can not imagine a more textbook display of the power of Vanna at expiration as we saw on Friday. The capital building was overrun by an insurrection, but all that that meant was a bigger late day rally.

2/x that ended at ATH on the close. Between Gary the 🦍 & his RVol suppression & his hand off to late day Ivol compression & the Vanna index bid, the 🐻’s never had a chance... but Gary’s getting tired after 2 months battling complacency & Vanna’s 2 week vacation, 1 of her only

3/x 2 week departures of the year (a 5 week OpEx) is quickly approaching on 1/15 morning. That means she’ll be increasingly absent as she prepares for her trip. W/ a $59 1 week straddle & $50 1 day range on Friday, & another $30 overnight drop, it’s hard to see why you wouldn’t

4/x want to take a chance on a little long gamma at this juncture. Especially given the obvious warning signs coming from the steepening of the yield curve, underperformance of the Growth complex, complacency in sentiment & positioning, anecdotal signs of bubbles in BTC & TSLA,

5/x NTM the growing exuberance surrounding a fiscal stimulus deal near $2 Trillion. The wall of worry of 3 months ago is gone. The vaccine is being deployed, the election is resolved, fiscal stimulus was passed & w/2 Georgia 🍑 🍑, ever moar 🚁💰is on the way. But what happened

Long rant: So earlier today, I got into a spat over the $15 minimum wage with @JamesSurowiecki and @noamscheiber. Because this disagreement over whether there is a mechanical relationship between raising wages and less jobs is incredibly consequential, I wanted to say more.

Interpretation of Financial Statements - preliminary filters.

1. Looking for sustainable competitive advantage:

When looking for sustainable moat, you wanna see consistency - in earnings, in having low debt, in having growing earnings, low spending in capital expenditures, etc.

The longer the company has existed, and if it sells you the same product for years (like Coca Cola), it reduces production costs and other costs (R&D, Training, marketing) slowly as the company ages.

When costs are reduced, margins and profits increase.

2. What to look for in an income statement:

Let's take a look at Apple:

i) You want to see earnings grow at a steady pace. Take a look at the net income below.

ii) Another thing that's important is a consistent and high gross margin.

As a thumb rule, Warren Buffett wants to see a gross margin of around 40% or above.

Although not quite 40%, it's around that range with respect to Apple.

Compare this to Apple's competitors.

Samsung's gross margins are around similar range, highest being 45.7% in 2018, and Huawei had a gross margin of 38.6%.

** MMT is the new supply-side economics
Forty years ago, some economists started from an uncontroversial (but important) result: a lower tax rate raises the tax base, so revenues won't fall as much. But then they ran with it, predicting tax rate cuts could raise revenues.

1/13

The 80s supply-siders went to the limit and came up with a motto: lower taxes will lower deficits as a norm, not an exception. Many economists shouted this was backwards. It was an implausible limit case. Textbooks called them "charlatans and cranks" or "silly".
2/13

In 80s debates, supply-siders would often fall back to "you don't understand me", repeating "Laffer curve!" endlessly, or stating vacuous accounting identities about how the government collect taxes. Their extreme prediction was repeatedly proven wrong by theory and data.
3/13

But they had popular hero figures (Laffer, Moore), and an eager political audience that would use any argument to cut taxes. Eventually, they inspired new good research, and helped in swinging the pendulum of policy debates to include some valid supply considerations.
4/13

Yet, supply-side economic ideas also contributed to a massive rise in US public debt in the last 40 years. Right-wing governments became as prone to have large public deficits as left-wing governments, in the pursuit of cuts in taxes.
5/13

The problem with (and for) #SiliconValley is their lack of #entrepreneurship. Yes, really: they're bad at being entrepreneurs, at providing the entrepreneurial function in the economy. To put it differently, they are technology driven in their profit-seeking but not consumer

driven. The difference is monumental both for the economy and the companies, and this is why they're failing. No, failing doesn't mean they are necessarily losing money, but that their profits are short-term and that they are undermining their own market positions. The business

they are in is not sustainable. This goes way beyond the selling of eyeballs, which is the focus of Facebook, Twitter, Google, and others. As it's often said, if you are not the paying for the product you *are* the product. Facebook is selling you, and your future purchases, to

their advertisers. The service the company provides is to lure you in, keep you busy, and make sure you don't leave while they feed you ads and collect data on who you are. It's the same with Google's search, maps, etc. But my point is not this, but that the focus by these

technology companies, more broadly, is unentrepreneurial--that they have lost sight of the consumer and, therefore, the real value they facilitate. They're not entrepreneurial. This, in turn, explains their behavior in everything from attempting to steer, direct, if not censor