Letters from Members - 2004

Fri, December 24, 2004 6:38 pm

Maybe I overlooked it or it was in yesterday's news but I missed on y'all website the info on housing values falling 8%? I continue to have the oxymoron perspective that we can't have inflation when home values or either falling or consolidating or just peaking? This country has never experienced across the board declining home values. Greenspan is starting what he was trying to avoid. He needs to stop raising rates and let the market do it's magic. Later.

It is likely that IMMR will soon (Jan 5th or 6th) get an injunction ordered by the court regarding it's law suit against Sony regarding patent infringement on IMMR's vibration technology which Sony used in their Playstation 2 dual shock controllers and game units. There was a hearing in federal court last Friday (Dec 10th) to look at Sony's appeal to the previous judgment that had already been awarded to IMMR in the amount of 82 million dollars, by a lower court. I was privy to information from two people who attended the hearing and they reported that the judge was strongly leaning in favor of IMMR. The judgment will probably also include royalty payments of approx. 1.4% on units sold by Sony USA, not Sony Japan. The amount is being reviewed by the judge. The stock currently trades at the $5.86 level. This judgment should propel the stock back to it's highs in the 10's when it is made news.

Regarding your posting today, by no means am I an expert but have done some historical review and included my own experience trading options primarily in the 90's. I have stopped trading options except in special situations. "Live by sword, die by sword" is my motto on options. My charting service only goes back to late 1986 with the VIX. Interestingly the VIX has been in a range of say 10 to 17 a good deal of that time particularly before the latter part of the 90's. There were a few spikes during 1987 (crash), Gulf War I period, and a few other times particularly in the late 90's when we had some currency problems around the world. Interestingly the VIX was around 11 or so at the start of 1995 right when the GOP took over congress and the real start to the massive bull market in the late 90's. To me the VIX means volatility is going to pick up. That could mean big up days and
some bigger down days. You're right though there does seem to be a Euphoric feeling particullarly in Republican lived areas. However, that may not be the case in every area. Matter of fact some areas are hurting. The thing I am starting to look more at is the put/call ratio (puts money where the mouth may or may not be). I have not really relied on it in years and still take a grain of salt but it may be running more in line with older norms. Meaning closer to .40 or .50 the selloff comes and vice versa. We are one terrorist attack away from more uncertainity with one exception. We have people in Goverment that will fight back with the full credit of the United States, and even that may not cause a big selloff for too long. That is why people matter.

First of all, I want to tell you how much I enjoy your service. Great job, keep up the good work. I do have two questions. One, can you tell me the date my subscription terminates. The second question regards your recent comments on the stock LMIA. A great pick, but you indicated it could respond similar to TZOO. What would your target be for a situation like this, or do we follow the 10% rule. Thank you

Do you expect LMIA to head higher? I got in at %5.22 - great call!!!

I'm not a chart expert but do like to delve into history at times....... Possibly. Looking again at the Dow Jones stocks charts from 1929 until WWII a familiar pattern is starting to even get more in focus to the Nasdaq chart pattern from March 2000 until now. What happened in 1929-1934? The Dow after peaking at somewhere between 320-350 then started a 3 three year downtrend bottoming out around 40 in mid-1932. or say an approx. 88% fall. However, it was a tight downtrend hugging the top resistence line on the way down. With the heavy selling in the last part of 1931 and first part of 1932, obvioulsy before Rooselvelt was to come to power. The run on the banks, the protectionism, etc.. However the key pivot down took place in the second half of 1930 after Hoover increased the top income tax rate to 64% from 25% to balance the budget. Just like the key pivot in the Nasdaq decline was in the fourth quarter of 2000, when the election was being litigated. These two respective pivotal moves confirmed massive long term double tops and broke support, setting up the long term bear markets for period. In 1933 the Dow broke it's long term downtrend and then went sideways for a while at approx. 88. Over the next few years it increased up to 175 but always had approx. 88 as a support or approx. 75% below the 1929 high. Once WWII hit the market then resumed an untrend that was more predictable. The Nasdaq appears to be forming the same patterns in my opinion. It's broken it's downtrend had a nice rally and is moving sideways to up. So the Nasdaq could double over the next 5 years or so. But what is causing this history to repeat itself. It was slow growth then. Deflation. Hard to find jobs. Fascism on the march. WWII looming. Massive Goverment reform. Today could it be shades of then. Growth but not fast enough for the new technologies. Disinflation verse deflation, a big difference. Hard to find traditional jobs. Radical Islam on the march. WWIII looming. Massive conservative Goverment reform. Interesting comparison if not an exact comparison.

The declining dollar and deficits. Well if the world shafts us who is going to keep them free and who is going to buy their products. It sounds like we both have each other "Over A Barrel Of A Gun".

I had the same reaction. But in the interest of getting the best of both, may be you can make the DJNS available via a link in a different window or a scrolling ticker.
Just a thought.

Thank you for reverting back to the activr traders, original format; i was thinking of cancelling my membership if the new format continued; the reason is that i like most of the people who use discount brokers ( I use .......) get free access to the dow jones news with better search facilities which is all free. (i can search get the up to date news on any particular stock symbol). Besides we like your comments and tit-bits and also the high volume options etc.

Thank you again for going back to the old format. GJ

The Beta format is a terrible format for the Active Trader, hard to read lacks content

If you are going to use this format in the future I will cancel my subscription

And, I really like “Active Trader.”

Sounds like a real good example of what my old boss. . .'Gus Levy' . . used to tell me. . . "If its not broke. .. don't fix it". . .

Yes, I thought it was "crap" too.

Thanks for reverting.

thats better

thank goodness. I was just about to cancel a membership, .............................
however your old format gives a bit more meat. so I'm glad you are going back to old one.

GOOD DECISION. I WAS EVEN THINKING ABOUT CANCELLING. HAY, IF IT'S NOT BROKEN, DON'T FIX IT. THANKS,

Good move back to the ole' Active Traders. What I thought you were going to do was mix FILTERED Dow Jones info between your normal Active Trader commentary. That would have been a winning combo and you would have at last 1 entry a minute between your stuff and Dow Jones. But if that can't be done, then go back to the classic AT is best.

Good Move....The old system was better.

Thanks! I, too, didn’t like the new format. TOO HARD TO READ. Missed your opinions on news.

Hello,
As a current member of Stockwinners, I am very pleased about your decision to reinstate your previous format for the active traders' page. I was considering cancelling. Once again, thank you very much for your decision

Thanks God - was ready to quit!

very good.. smart decision.....

Thank God! You saved yourself a subscriber, I was about to cancel. Thanks for listening.

THIS SUCKS.

I was going to call you and ask / demand for a refund.
GOOD THING YOU CAME TO YOUR SENSES

Thank you, Thank you, Thank you !!! I won't cancel my membership !!!

THANK-YOU!

I LOVE YOU!

I didn't E-Mail you, but only because I didn't have time. I too like the old format. Thanks for changing back! Have a great week-end.

Hey Stockwinners!

Classic Active traders and Stockwinners in general is a unique offering not duplicated any where else, on or off the net. The uniqueness comes in the way it is presented, like you're talking to me and hoping that I'm going to make lots of money. I like that!

Keep up the good work and long live Classic Active Traders!
( Bye the way, your monthly fees are too low.)

thank goodness

Thank you!!!!!

Thank you

Wow! What a day! This has been a learning experience for all of us at Stockwinners.com. We had received numerous e-mails in the past few months, requesting continuous up-to-the-minute news feed. After studying several options, in our finite wisdom, we decided to replace the Active Traders Page with real time news and information feed from the Dow Jones News Service. After all, they are the best in the industry. As it turns out, that was not such a popular move with our members. Since midnight last night, we have been inundated with e-mails and phone calls from members requesting reinstatement of the old Active Traders format. We have listened. Starting Monday, Active Traders will be back in its original format. Looks like we should have learned from the Coca-Cola experience. If a product is that popular, it is a classic! The Classic Active Traders will be at your service on Monday October 4, 2004.

Best Regards

The Staff and Management of Stockwinners.com

The Beta format is a terrible format for the Active Trader, hard to read lacks content

If you are going to use this format in the future I will cancel my subscription

And, I really like “Active Trader.”

can you please change my active traders back to the way it was?

PLSE CANCEL MY SUBSCRIPTION PRIOR TO NEXT BILLING DATE.KINDLY ACKNOWLEDGEAND CONFIRM BY E-MAIL.

Still NG - if this can't be corrected, cancel my subscription and refund my money

The new page appears to be useless. I use you large options trade information to do a lot of my options trading. I like the format and the way the information is presented. Showing the dollar value of the large options trades helps determine what the trader might have paid for his option....

Thanks.

I am writing to express my EXTREME DISSATISFACTION that you are even CONSIDERING not having Active Traders anymore. Active Traders is/was your very best feature, and it gave many helpful pointers and trading tips throughout the day. Active Traders has helped me make money, and to replace that with simply the Dow Jones Newswrite, which I can get anywhere, is simply not good enough.

As I said, I am shocked that you would even CONSIDER not having Active Traders any more. If that persists, I will have to seriously consdier terminating my subscription to Stockwinners. Why would I need Stockwinners

Sincerely,
a very dissatisfied customer

This is OK if it works in conjuction with your regular analysis and old format, but I am only getting a feed from Dow Jones.

Is this gonna be a permanant change? No more of your own written analysis and summaries?

Large option trades was one of the reason I was interested in stockwinners.com active trader. Now with the new feature it has been removed. I like the time of the trade and the actual trade provided in a proper way. Now it has been moved to Market alert which I receive by email. This is not good at all and I want the old feature back for it to be any useful.

Thanks,

I strongly dislike the way you have changed the Active Traders page, and wish to cancel my service at the conclusion of my latest renewal period. According to the notations below, this should be as of November 30, 2004. Please send an e-mailed acknowledgement of my cancellation at your earliest convenience.

Dear Sirs,

Where is your commentary? The option blocks, etc. All I'm getting is Dow Jones!

Guys,

Where is my dependable, to the point, Active Traders page??? This is information overload!!! I have no quarrel with having a separate page with all the Dow Jones news, but please leave the Active Traders page the way
it was.

I might occasionally want up to the second news, but I much prefer the Active Traders concise comments and observations. I don't have time to skim all the Dow Jones news for the little bit that is relevant to me.

You guys are the best at what you do. Keep that and put the news on a separate page for the news junkies.

Thanks!

HI,

All I'm getting is DJ news feed. No commentaries or anything.

What's up with this.

I am very disappointed with your new Active Traders page. It gives you very little information and no options trades. Please consider going back to the previous version.

Is 300,000 avg. job creation inflationary when we've had that for two months after a 3 plus year doldrum with a war going on when 3,000,000 million jobs were lost and approx. 100,000 to 150,000 per month need to be created just to absorp population growth?

We have a war, a boom in China and a runaway housing market. That said there have been and remain deflationary pressures inside other sectors in the U.S. economy. Debt levels are at extreme and pay is down for many Americans. The squezze is on at some companies I am related with. The squezze from unexpected higher taxes, and some cost are forcing pay cuts and reducing expenses further. Some of these industries although small are tied to commercial real estate and particular the car rental demand at the world's busiest airport. 9/11 and the Airline woes are still playing some havoc. No question they have revved the gas for the election effort. But when the housing crash comes this thing could tip to deflation faster than a New York minute and don't forget China or a renewed Bear Market. In a real time economy my thinking is there will be some deflation and some inflation possibly going on. But don't mistake this for 1970's style inflation. And don't mistake GDP growth for inflation. That was the mistake of the FED in the 1920's. And don't mistake the socialist Countries who don't produce jobs or innovation as an indicator of what is going on.

Why should we suffer because of China?

Welcome to the global economy. A revolving, stealthlike economy that will have rolling booms and rolling bust. But the point was to try to eliminate bad, deep, long recessions inside the U.S.

First of all congrat for OSIP also on 20 april you said that trader bought calls may 45!!And it was very strange that trader buy a strike so far from the price of the stock.But when you write about calls and puts which difference for importance is between player and trader? About PMTI the stock was started as a sell from DJMaxim group. Do you think is an overreaction today? Thanks and have a nice day!

Let's hope policy makers see the real problem here. Besides, China/Iraq we have a booming housing sector? Why? It's not only low interest rates. It's also Goverment has picked winners and loosers and we know what happens when that happens. A bubble develops. When a sector has little barriers of entry and their is no capital gains tax for ownership $250/$500K and the interest is deductible capital with find that investment. Also take it from someone who has gone/seen through three real estate debacles, when the industry finds a capital source it will run it into the ground. It's not demand driven, it's always capital driven, ie..can the money to develop be obtained. The market/industry generally overbuilds with time. The mistake would be to think that China, Iraq and housing are an indicator of the overall American economy. That is a real catch 22. It will take some policy makers with keen insight to see what is developing here, a possible problem in the new economy that we have'nt experienced before both inflation and deflation forces at the same time. Personally I would think of jawboning with higher down payment requirements verse higher interest rates and then proceed to narrow the tax advantages. And keep doing what we're doing with regards to China and Iraq.

The Realist Says....Get over it higher interest rates are se la vista maybe even lower rates will be needed and deflation fighting tools by the Fed. The housing market can't take higher interest rates as we've seen what happens with a little increase. The aging of the population may be starting to hit this economy...20 years ago they were the entreprenuers now they are the early wave of the retirment boom. We are going to need massive new growth ideas in the generation ahead. The payroll tax is a great place to start. Either invest or cut it.

I foound you on a news reference to a stock from my brokerage. Such high-risk scenarios as you intruigingly describe might be appropriate for 3 to 7% of my portfolio.

But why I should I give you any credence beyond say, Bernie Ebbers or a politician, if you won't register as an investment advisor, hold yourself accountable to the securities industry regulators, and say whether or not you're holding a position in -- and thus perhaps "ramping" -- any stock you advise on?

I have 30 years in economic and business analysis; my time as a portfolio manager has been much shorter, yet I have been victimized by several ramps already. Any evasive anwser on your part will be given scant credence. Of course even willingness to divulge your investment advisor information is not, by itself, any evidence as to your credibility, probity or skill in what you are doing -- giving investment advice.

Sincerely,
Ron

What exactly do I get with your free two week subscription offer? What is the active traders page all about? I clicked on Stock options( I just begun a free subscription) and only saw previous picks mentioned, how previous it did not say. I saw your performance page, did you really recommend 340 options in just four months,? Why so many? I also could not find your Momentum recommendations, please help with these concerns, I will buy a membership if I can clear up this confusion.

your BLTI info playing havoc with my 'long' position....I know you just call it as you see it.

Keep up your good work, though

Good Morning,Just wanted to tell u folks i love your site!!!An i have made some good money off your option picks.I do not play every recommendation.However after i do my homework, i place the trade after the market volitility has subsided.

Artie

Inflation worries?...Disinflation or even outright deflation will be the threat for the next 30 years. Why? aging population. Globilization. Technology. Debt levels. Housing boom can't continue. How much lower can rates go? To 0% or neative I guess. Fiscal policy is where the real action will be. Get a liberal in the White House and deflation will be upon us big time. A large deficit will make it hard but if the deficit can be lowered thru spending controls then there could be more tax cuts which will be need to battle disinflation in the years ahead.

CSCO trading down $1.34 in the pre-market. Please note that, last week on January 29, we saw large blocks of February put options being bought late in the day. Hope you took the opportunity to either move out of your CSCO long position, or hedged your bets by selling some calls (or even shorted the stock if you were fortunate).

I purchased 10 Feb 27.5 CSCO puts yesterday near the close and sold this AM. Thanks! - Paul

Hello,

I always wondered why you don''t have any stop loss for option positions when they go against you. For instant, your latest recommendation on Eastman Kodak March 30 call.

Good morning, I am a long time subscriber of Stockwinners and I utilize the information in your active trader column, particularly the option call and put trading.

Please continue to inform us of unusal option buys and sells. Thank you.

Yesterday on Active traders, with one exception, there was no mention of PUT options trading, and two or three references to large CALL options toward the end of the trading period, yet PUTS exceeded CALLS by a large margin. I was not aware of that till after trading hours. Based on the CALL options you were reporting I added to my CALLS, when I should have hedged my bet with some PUTS. Can you tell me why you did not report the volume of PUTs exceeded the CALLS yesterday?

Any idea what we can expect from MSFT this morning????

Regards.

"10:38 From time-to-time, We receive letters from our members questioning the value of reporting options transcations and calling these reports as waste of time and money. On January 12, We reported large blocks of call options buying on AMR. Today, shares of AMR are up $1.61 to $16.16. "

Well, it's a crap shoot isn't it? Large option purchases could be funds hedging their holdings or someone trying to scalp a small move. In the former case, following the fund purchase might put you on the wrong side of the trade and in the latter case a few contracts might not do much more than break even after spread and commissions.

A better refutation than siting ONE example as you have done above, would be to site MANY examples over a longer time period.

Thanks - Paul

Billing Department,

Actually, I reviewed all the subscriptions I have, determined their contributed value to my trading operation and have realized that Stockwinners is by far the most consistently accurate and profit producing. I wish for you to cancel my cancellation, if that is possible. This says something about your quality.

Thanks,
Matthew

I've been trying to figure out how you arrive at your "performance" record used to promote your website. Your advice regularly suggests avoiding early volatility before entering into a position, yet your performance record (not appearing until one day after your new recommendations) appears to take advantage of the best price -- either the opening price or the later "post volatility" price. To say the least, this seems a bit disingenuous if not deceptively. Case and point: NUS is on the downside following your buy recommendation and you show the lower "post volatility" price of $19.92 as the price paid, even though the opening price was $20.55.