Amplify Commodity Trust (BDRY) Options

Nice call. Watching 25-26 area for support

Don't want to say it but going to say it. Capped. Largest growth etf. Fade and consolidate for a while imho

Where is the all knowing? Still short? Back to bdry...the purpose of this board.
8 bucks....they sold 3 million shares or so into the market since February. Bdi was on fire...this would have ripped with it...guess they needed to keep their fund liquid...new moon monday

Allocations for week beginning 4/20/20

.25% TIP 'on' / .6% BDRY 'on' / .15% Money market (MM) 'on' = 2% total

.25% TIP 'on' / .75% MM 'on' / OIL 'off' = 2% total

.25% TIP 'on' / .75% MM 'on' / DBA 'off' = 2% total

.25% TIP 'on' / .75% MM 'on' / QI 'OFF' = 2% total.

.25% IAU 'on' / .75% MM 'on' = 2% total

.5% SH 'on' / 1.5% SPY 'on' = 2% total.

22% STIP

66% MM / total MM = 75%

100% total

Changes from previous week:

Massive move into MM as deflationary pulse closes out the last three days of the week.
Inflationary loving assets were sold as a clearer picture is needed before reinvesting in them. or perhaps going with the deflationary loving IEI as the asset of choice.

Seems some inverse junk bond holders still haven't learned their lesson.

https://www.zerohedge.com/markets/meet-fed-fighters-junk-bond-etf-shorts-hit-all-time-high-despite-fed-backstop

...don't fight the Fed (especially with Trump cheering every new asset purchase escalation). There is no limit how high the Fed balance sheet can go, and no depth so deep the USD can't fall further. Never, ever fight the Fed.

BDRY position 100% filled at the close.

Nothing to Stop Global Inflation... WIP starting to look good.

The brake on global inflation has alway been the Fed running a positive interest rate and a sound (relatively speaking) balance sheet. All that has changed in the past couple of weeks with the Fed now in the same bed as the EU and Japan.

MMT is now the 'official' monetary theory used by all the major currency central bankers. Will China one day step into the breach with a strong Yuan policy and become the new World's Reserve currency?

TIP is my measure of domestic inflation while WIP international, looks as though WIP will soon overtake TIP as my longer-term inflation loving asset of choice.

Allocations for week beginning 4/13/20

1% TIP 'on' / 1% BDRY 'on'

2% TIP 'on' OIL 'off'

2% TIP 'on' DBA 'off'

2% IAU 'on' UUP 'off'

.8% SH 'on' / 1.2% SPY 'on'

2% TIP 'on' (additional)

12% SHV 'on', VGSG 'off'

76% STIP

100%

Changes over past week:

Added 1% to BDRY.

Move from a 100% SP 500 bear, to 20% bull position.

My Heart Goes out to these poor Bears...

https://stockcharts.com/h-sc/ui?s=sjb

They saw what was happening with the virus crushing the global economy and rightly bet against the weak-ass junk bonds that have over-extended themselves. Well their insight cost them a bunch of money today with the Fed fully engaged in MMT.

Lucky I wasn't among them.

Don't fight the Fed, if they want inflation (big time) ride them out in TIPS/STRIPS/LTPZ

Increased BDRY allocation to 50% today.

Wish it wasn't going up so fast... difficult to keep buying at ever higher prices.

Fed has Officially Gone 4/5 Total/Complete Ape-Shit Today.

Fed USED TO only buy/sell 3 month UST -- LOL THE GOOD DAYS.

Now the Fed buys:

Long UST bonds.

Mortgage bonds.

'Investment' grade corporates.

and today...

Junk (should be bankrupt) bonds.

...only thing left is buying up the stock market, the ultimate buyback, which J. Yellen says the Fed NEEDS approval to do from Congress ASAP! No word if they want to buy soybeans, but I wouldn't be surprised if they do!

All this will/is killing the USD, which paradoxically, is the mortal enemy of the Fed!

SH is now fully hedged with SPY

Picked up a 20% position in BDRY

Looks like the global economy is on a turn-around.

Some information on the state of credit markets:

https://acting-man.com/?p=55232

Allocations for week beginning 4/6/20

2% TIP 'on' / BDRY 'off'
2% TIP 'on' OIL 'off'
2% TIP 'on' DBA 'off'
2% IAU 'on' UUP 'off'
2% SH 'on' SHV 'on'

2% TIP 'on' (additional)

12% SHV 'on', VGSG 'off'

76% STIP

100%

Changes over past week:

Added to SH
Added to STIP

And poof it's gone!

https://www.zerohedge.com/markets/mark-it-zero-triple-levered-short-oil-etn-crashes-complete-loss

That said I told a .75% flyer on 2x oil short SOC. Hope it doesn't go poof too -- lol.

Even if the world cuts 10 mad it needs to cut 25!

Classic buy on rumor and when the news comes out (either pro or con) SELL.

Update, GLD Fades and IEF is ahead by a Nose.

Interesting that GLD and TIP are numbered 1 and 1A owned by the same owner... inflation, where UUP and IEF wear 2 and 2A, owned by deflation.

When 1 or 1A change leads it's no big deal (same for 2 and 2A), but when a '2' horse passes a '1' horse for the lead, as happened yesterday, it is.

Market is now headed down and likely to make new lows. SH will certainly be added to this week. IEF is now the asset of choice and what OIL, DBA, and BDRY will be measured against.

Speaking of BDRY, huge pop yesterday (biggest percentage one day gain in 2 years). Every day getting closer to an initial position.

GLD...New Horse takes the lead!

This week is starting out crazy but why would it be any different than the past three.

Biblically the four horsemen of the Apocalypse are the four riders on white, red, black, and pale horses symbolizing pestilence, war, famine, and death, respectively. Happy thoughts, huh? -- lol

The market also has four apocalyptic horses as well: IEF, TIP, UUP, and GLD.

Three weeks ago, IEF was in the lead. Two weeks ago, UUP. Last week TIP, and this week, even though it's only Monday -- GLD.

Sold off a large part of STIP/TIP every early in the morning and added to GLD in the last hour. No one knows if GLD will hold up the rest of the week. The only thing I care about is that at the close today it's in the lead!

Global Growth is Dead...Prices are a Question Mark.

https://www.zerohedge.com/markets/how-china-getting-double-whammy-global-demand-collapse-now-following-supply-crash-earlier

The contraction of both AS and AD is a death blow to growth.

The effect on prices is contradictory giving two possible directions depending on the magnitude of each contraction.

Prices fall (IEF loves) if the AD contraction is greater than the AS.

Prices rise (TIP/GLD loves) if the AS contraction is greater than the AD.

What this does mean is anything depended on growth: stocks, junk bonds, 'investment' grade corporates, are toast.

Allocations for the week beginning 3/30

2% TIP 'on' / BDRY 'off'
2% TIP 'on' OIL 'off'
2% TIP 'on' DBA 'off'
2% IAU 'on' UUP 'off'
.8% SH 'on' 1.2% SHV 'on'

2% TIP 'on' (additional)

25% SHV 'on', VGSG 'off'

63% STIP

100%

Changes over past week:

TIP replaces UUP as comparison asset.
SH reduced as stock market recovers.
IAU is now 'on' vs. UUP
Major increase in STIP holdings.

Excellent Wonkish Recent Article on Stagflation

https://www.econlib.org/i-fear-stagflation-and-general-price-controls-are-coming/

...unlike the author I'm already betting on it!~

PS: If you don't know what an AS and AD curve shift mean and represent, you best get smart quick!

PPS: If inflation is allow to rise then STIPS are best, but if the government imposes wage/price controls GOLD and SILVER are by far and away the better assets. Get ready it's a coming.

The TIPs Mr. Market was Smoking Crack Today.

Day started out good, STIP up .33%.
An then about 1:00 pm EST it plunged down -.67% for a 1% move which is phenomenal for the short market.
WFT happened? Did the stimulus package get voted down? Did the USD soar.
Nope, package approved and Trump set to sign, the dollar continued to drift lower.

Figured out quick this is the classic: 'buy on rumor, sell on news,' gambit. I needed to buy some more STIP before the market closed so I took advantage.

After all is said and done the cross section of tips (STIP, TIP and LTPZ) pretty much closed unchained. What could have been my worst down day for the year ended off $22.00 -- LOL!

Stagflation is the new reality... the USD is toast.

The USA, or should I say the USC (Coronavirus), could well become the world's pariah. Today Germany put out notice to Germans living in the USC to head home asap. As the world quarantines the USC it only stands to reason they'll seek some other currency as the world's reserve.

Prior to WWI the british pound held the honor, but the European war moved the title to the USA which we've held ever since. Now it is China's turn.

As central banks replace the USD with the Yuan the dollar will decline and global prices for the goods we buy will increase. Gold of course will increase as well, along with silver. Needless to say inflation protected bonds will be a safe haven.

Governments do everything they can to limit inflation which only makes it worst.

https://www.npr.org/sections/coronavirus-live-updates/2020/03/25/821513190/stop-price-gouging-33-attorneys-general-tell-amazon-walmart-others

...what they are doing to limit the price increases on protective gear they'll do next month ON FOOD.

How I'm playing SLV

Silver is called the poor man's gold. I think of it as the common man's hedge against inflation.
With the price of gold in the stratosphere vs. silver the average man would rather own 100 oz SLV than a single oz of gold.

When inflation is first underway the common man has no clue so the price of sliver lags gold. But once the common man figures out that it takes more and more monopoly money to buy things the price of silver literally explodes. Trouble is once the common man has inflation figured out the Fed pulls the rug on him creating deflation and the price of silver collapses even faster than it rose.

What I'm doing is simply taking my profits from WDOFF each day and buying a bit of the poor man's gold, building it up oh so slowly getting set for the explosion.

Jack be Ninble Jack be Quick

What a week and it's only Wednesday morning.

Events of the past four weeks, with favored asset:

Four weeks ago the global economy was running along -- stocks

Three weeks ago it was slowing down -- IEF

Two weeks ago it was headed towards a liquidation deflationary depression -- UUP

This week it now headed full steam towards stagflation -- gold/tips

Needless to say my portfolio has undergone another dramatic transformation from last week, just as it's done for each of the previous three weeks.

Confucius... May you live in interesting times. Last four weeks have never been more interesting.

Trump Declares National Suicide Day -- 3/24

When Boris Johnson is taking the right path and shutting down the UK, DT (Donald Trump aka Delirium Tendrium) says... back to work, back to school, fill up the pews, and party like there's no tomorrow.

Live, drink, and make merry for tomorrow your granddad may die (but will tie up a hospital bed for three weeks before he does).

The callous might consider this a covert plot to save SS, but granny and gramp are going to rack up such huge medical bills before they go it would cheaper if they all lived to be 100.

In a couple of days the US will indeed be the world's leader... in co-19 cases!

If you want to see the current state of the global economy look no further than BDRY!

Certificates of Confiscation -- straight UST

Back in those wonderful days of stagflation in the 1970's when inflation was running faster than the return on straight UST, they earned the derogatory name.

Well guess what, CofC is now the order of the day. With 'Buy Everything' Powell (BEP) spinning the money crank handle as fast as he can.

Unless a bond is inflation adjusted it won't find a place in my portfolio... SHV excluded.

Not 'Special', your diet is to blame.

https://www.dailymail.co.uk/news/article-8140995/Iranian-government-minister-publically-speaks-coronavirus-conspiracy.html

The death/case number differential is striking!

Iran 8%, Germany .4% so what gives, a special virus is infecting Iran and not Germany?

Nope it's the diet.

Germans love their pork, beef, and raised bread.

Iranians love their rice, cheese, dates, chicken, and flat bread.

Pork and beef are loaded with zinc and raised bread doesn't deplete the virus limiting zinc.

Chicken, cheese, and dates contain little zinc and is flushed out by rice and flat bread.

It's been known for a long time that Iran is one of the most zinc deficient countries of the world only exceeded by India.

Suggest you put down the Koran and start munching on some Brats --lol

Godzilla vs. Rodan, who would win?

In financial market terms... the USD Death Star vs. The Fed?

Depends on if the Fed was constrained to buying only UST (and mortgages in 2008+), as it has been it's entire 106 year history and congress at least pays lip-service to the idea of a balanced budget. Today however, the Fed is buying up 'investment' corporates, and 'investment' munis and god knows what else tomorrow.

The Fed is now unchained, able to engage in MMT and buy whatever it has a whimsical feeling about purchasing. Will tomorrow bring the Fed to the market buying, junk, real estate (lot of cheap vacant malls out there), stocks, gold, commodities, currency, negative yielding Japanese gov't bonds, cruise ships... the list is endless.

So to answer the question, given unlimited deficit spending (balanced budgets have forever gone the way of the Dodo bird) and an unchained Fed, the USD doesn't stand a chance.

So long Death Star, hello gold.

'Long' SH -- LOL

Still the end of the world here. Long yet?

DB: Helicopter money => Hyperinflation => Gold/TIPs

https://www.zerohedge.com/markets/deutsche-bank-helicopter-money-will-be-disastrous-and-will-lead-hyperinflation-buy-gold

...economics of hyperinflation.

Was Last Week the End of the Bond Bull?

https://www.marketwatch.com/story/mortgage-rates-surge-to-highest-level-since-january-even-though-the-fed-just-brought-interest-rates-to-0-heres-why-2020-03-19

...he's been running since 1981 or 39 years. Must be getting a bit winded by now especially now that his arch enemy price inflation has stuck his narly decaying dead middle finger up from the grave. Personally, if I was to underwrite a 30 year mortgage it would have to be 1 for 1 adjusted for inflation.

USD Has All the Room in the World to Run Higher

https://www.countingpips.com/research/speculators-cut-their-us-dollar-bullish-bets-euro-yen-aussie-bets-surged/?utm_source=newsletter&utm_medium=email&utm_campaign=cot_email

...Latest COT report -- LOL

Market will need to resolve UUP / STIP Inconsistency.

Today my holdings include both the USD (a deflationary loving asset) and STIP (an inflationary loving asset). So how can I like both? Answer. The time frame I use for trigger buy/sells is shorter for STIP than UUP. If inflation truly does turn into a trend I should be fully invested in STIP the day I move from the USD into GLD which is also an inflationary loving asset.

Personally I'd love to be owning gold but my numbers say no, so I won't. If you want to have some fun with the yellow metal look at the junior manning company WDOFF, not for the faint of heart. I own a tiny, tiny, tiny bit and doubled down on it at the close on Friday.

Absolute Funds have done nothing... absolutely.

I run a short-term bias absolute fund which means I can own anything... stocks, bonds, currency, commodities, real estate and be either long or short. The stock market has now given up three years of gains so you'd think the Absolute Funds would be going through the roof.

But that's not the case.

https://www.marketwatch.com/investing/fund/qrpix

If you look at the category return for three years you'd see they are underperforming a S&P buy and hold strategy! Over ten years the compassion is horrible.

There's an old expression on Wall St. 'Bulls make money, bears make money, but pigs (absolute funds) get slaughtered. Luckily I've dodged the farmer's axe (so far) and I'm living it up rolling in the slop... oik, oik --lol.

Food Price Inflation at Retail Level

https://www.newsmax.com/finance/streettalk/food-global-world-needed/2020/03/20/id/959211/

...excellent article. Food prices at the producer level (DBA) are muted however, so any pop should be short-term and off-set somewhat by the crash in gasoline and other energy costs.

On the other hand once global warming kicks in, and crops fail DBA, will be the ETF of choice and I'll increase my percentage holdings accordingly. Global crop failure will make co-19 feel like the 'good old days'.

FIDPX is a fine fund mirroring TIP.

If you have a option I'd go with TIP over the mutual fund for the following reasons:

1) Owing an ETF you can buy/sell at any time during the trading day, a mutual fund only at the close.

2) Mutual funds have holding periods, typically the shortest is 30 days, couldn't find out what the period is for FIDPX vs. a two day ETF holding period.

3) Mutual funds are often discretionary which FIDPX is rather than following a formula. In my mind discretion means mistakes.

4) Mutual funds have higher expense fees.

The maturity breakdowns again are STIP 2+ years, TIP 7-10, LTPZ 15+. Of the three I use LTPZ for my STIP buy/sell signals. It turned first last week giving me the opportunity to catch 100% of the price movement on Friday.

JL,Do you have any opinion on FIPDX the inflation protected bond fund by fidelity? For those of us with money stuck in a 401k ? Thanks

The expected move in the spx last week was 226 and it moved over 400 points. For the coming week the expected move in the options market for the spx is 228 points. The expected move in the spx options has been surpassed in 9 out of the last ten weeks which is unprecedented.

Allocations for the week beginning 3/23... You Ain't Seen Nothing Yet!

2% UUP 'on' / BDRY 'off'
2% UUP 'on' OIL 'off'
2% UUP 'on' DBA 'off'
2% UUP 'on' IAU 'off'
2% SH 'on' SPY 'off'

2% UUP (additional)

76% SHV 'on', VGSG 'off'

12% STIP

100%

Changes from previous week:

All UST long dated holdings have been sold... IEF, IEI, even VGSH.
SHV, a near cash 3-4 mo., UST bill fund was bought.
SHV is the funding account for STIP...2+ year inflation adjusted UST.
UUP replaced UST as the on/off asset in the 10% allocated to asset pairs.
STIP was added.

Last two weeks have been incredible, I don't know why this next week should be any different.

Twin Deaths are Tag Teaming Each Other.

UST and USD.

Going back to mid-Sept. 2008 the USD took off (as it's doing today) as the LIBOR rate exploded higher...see earlier post today.

The USD, as you know, is the ultimate DEATH STAR or BLACK HOLE asset sucking every other asset in the world into it during a complete liquidation... or Sell Everything (including UST).

From mid-Sept. 2008 to March 2009 market bottom, the USD and UST switched positions being favored assets twice with the dollar running stronger during the liquidate time frame from mid-Sept to mid-Oct. Then it was the UST turn until the end of the year, then the USD until the market bottom.

In playing the market I'm riding this trend. Instead of being in 'long-dated' VGSH (2-2.6 years) I've shorted up to 3 -4 mos. holding the 'almost' cash...SHV. At the same time I'm playing the inflationary trend I've smelled out buying STIP...see earlier post today.

No Two Stock Market Crashes Are the Same

The big or should I say HUGE difference between 07-09 and today is the action of TIP (treasury inflation protected bond) and it's long dated cousin LTPZ. On Friday LTPZ was up more than a mind numbing +12%. Using TIP (since LTPZ wasn't around in 07-09) Tips followed the market crash in stocks from mid-Sept to mid-October 08, as both were foretelling of a coming deflationary depression.

Back then QE and the power of the combined central bank printing presses was only theory. Today with MMT and the ability to send every man, woman, and child a million dollars a day, the thought of a deflationary depression is almost laughable.

Above my desk I have a Zimbabwe bank reserve note for the tidy sum of... one hundred trillion dollars, which adjusted down to about $.25 USD. Hyper-inflation erases debt. All debt that hasn't been adjusted to it. Student loans, mortgages, credit card, auto, and personal loans all go bye-bye in an instant.

Hard for file for bankruptcy (which is the anvil of a deflationary depression) when you have NO DEBT.

I mentioned last week I smelled a whiff of inflation, we'll this week it's noticeable stronger!

Perfect Storm for a Stock Market Crash over the Next Three Weeks

Using the 2007-09 market meltdown as a reference guide.

I said last week the market today mirrors mid-Sept. 2008. At that time the market had declined 26% from the peak in October 2007. Today surprise, surprise we are also down approximately the identical amount. What took almost a year to do in 07-08, was accomplished in a couple of months in 2020.

In mid-Sept. of 08 the LIBOR (or inter-bank lending rate) exploded higher as government bond yields plunged. What this meant was banks were unwilling to lend to other banks... the financial system was freezing up. This took a month to resolve, but in that month the stock market effectively crashed losing an additional 40% from mid-Sept.

https://stockcharts.com/h-sc/ui?s=$libor

Short selling will be banned so if you haven't bought SH by now the window is closing IMHO.

Liquidating USD DEATH STAR explodes higher.

https://www.zerohedge.com/markets/rabobank-we-warned-dollar-would-go-and-then-well-here-we-are

...I wonder if MS is rethinking it's position this morning?

This is WAR! That means INFLATION.

ALL wars have elevated rates of inflation with the Revolutionary War leading the pack.

The whiff of inflation maintained itself today.

Evidence is the collapse of prices of UST with the 30 yr. getting hit the hardest and the shortest SHV having a record positive day.

The reason a treasury buyer would shorten up dramatically is that they fear an increase in the rate of economic growth -- LOL

or...

An increase in inflation.

I've gone effectively to cash figuring a .10% interest rate leaves little to the upside and an infinite move to the downside.

Risk/reward says cash is King.

Still with with first glimmer or inflation (POTUS promised us shortages today) cash is King unless it's moving into STIP currently 5% holdings.

World is collapsing into the DEATH STAR

Commodities, other currencies, bonds of all stripes, gold, real estate... everything is collapsing into the USD as a mad dash to sell absolutely everything creates a dollar shortage.

If everything is collapsing it's the Fed's job to BUY everything.

If they don't a deflationary depression looms.

Huge portfolio changes today as the US is certain to embrace MMT.

Rule one, don't fight the Fed and it looks as though the Fed will be printing trillions of newly minted money to bail/buy out EVERYTHING both foreign and domestic.

This unlimited power means change can happen seemingly overnight. I've sold off all of VGSH and purchased a small amount of STIP. Over time I'll add to it as my numbers warrant.

Sold off IEF
Sold off IEI
Sold off SH

Sold off 40% UUP and bought IAU

Starting off 90% in cash waiting for the effects of MMT to be fully appreciated by Mr. Market.

Stagflation Loving STIP, IAU, Real Estate... SLV (only for the truly brave)

Today market a movement from economic winter, characterized by falling growth and deflation to economic summer (stagflation) falling growth and inflation).

Only a very few assets do well in stagflation (see above).

Still stagflation is a cake walk compared to a deflationary depression. Think of a person sitting in a dark corner going 'whoa is me', in a deflationary depression.

In stagflation the depressed person is giving 'crack' making them jump up and run around the room like there was a nest of fire ants in their pants. In this case doing something (anything) is better than doing nothing at all.

Note that both the depressed passive person and the agitated crazy person aren't very productive.