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A quick trade on Pelosi’s trip to Taiwan

Aug 02, 2022

Good morning!

‍A few weeks ago, I posted a question that began innocently enough on a particularly sleep-deprived morning … what favourite coffees do you recommend?

Answers flooded in from around the world.

Try Viennese coffee but be sure to use good cocoa powder and heavy whipping cream urged Markus. Sofia encouraged me to pour some amaretto and sambuca into a footed cmug along with some cream and vanilla flavoured coffee for a Venice-style wakeup. John swore by coffee as black as a boiler, which is how he learned to drink it while serving in the USN.

Trevor, though, took it up a notch!

He made a beeline to the markets and very kindly hand roasted several pounds of the freshest coffee he could find. Then sent Noriko, the boys and me a wonderful package filled with coffee all the way from Indonesia!!

What a treat!!!

Indonesian coffee is produced using a traditional processing method called giling basah, which is a semi-washed method known as wet-hulling. The coffee cherry is allowed to dry on the bean for a bit then removed which imparts a silky-smooth, very complex yet smooth taste.

I highly recommend you try some, in a beer mug naturally which is how many Indonesians like to consume their beans. It’s my new favourite!

Terima kasih banyak Trevor!!

Meanwhile, futures are slipping as Pelosi’s trip to Taiwan looms.

Here’s my playbook.

Did she call Paul?

I’ll admit this is dark, but I will not be surprised in the least to learn that Pelosi’s stock savant husband Paul purchased puts ahead of her trip to Taiwan. The meme is certainly making the rounds.

All joshing aside, China’s contesting the trip, which naturally has global markets on edge. (Read)

Many are concerned about the prospect of a military counter-strike given China’s statement that it’ll shoot down any US military assets making the journey and consider doing so an act of war.

Frankly, I’m more concerned with additional supply chain interruptions and the potential for global currency disruption. Investors, for example, are piling into US bonds this morning while US stock futures are ticking down as I type.

Like many, I trust that cooler heads will prevail and the play, if they do is to take a quick punt on lower bond prices using the Direxion Daily 7-10 Year Treasury Bear 3X shares (TYO). In today and out immediately when the Speaker is “feet wet” meaning she’s left Taiwan. Tomorrow at the very latest.

Forget crypto, this could be the next goldmine

News broke yesterday of yet another security exploit which drained $200m from a decentralized cross-chain “bridge” used to transfer money from one token to another. (Read)

What makes this attack different is that criminals figured out a way to hack/spoof the system in such a way that Nomad – the group that got hit – turned into an online ATM that spewed nearly $200 million.

It’s being called the most chaotic hack yet but the real standout here is the “yet” part. Ronin got hit this past April to the tune of $600 million. Wormhole got tapped for $300 million a few months before that.

Which brings me full circle.

The real money – meaning serious investment potential - in crypto is going to be made through blockchain forensics and intelligence. Not usability or even as a currency.

I’ve long said there will be a sea change once people realize the whole “no regulations” thing isn’t all that it’s cracked up to be. And seems to me, that point is right around the corner.

Darktrace (DARK)?

Travel is returning

It’s taken about 12 months longer than expected, but leisure travel is finally coming back to life. Case in point, Marriott reported stellar earnings with booking levels in line with pre-pandemic levels. (Read)

I’m still leery.

Why you should care about Ferrari’s results

Ferrari’s F1 strategy may stink lately but the company itself continues to put up great numbers. Q2 revenue, shipments and profits were all up 20% YoY. What’s more the company increased guidance, too. (Read)

The company has confirmed production is underway for the V6 hybrid 296 GTB but sales for the F8 and Portofino M remain strong.

I’m still a 308-kinda guy myself, though.

Why you should care: Many people will read this story and think, “so what” if they don’t own a Ferrari.

That’s a mistake.

What this story points out is that certain companies CAN protect margins, even at an average price of more than $1 million a copy. GM or VW, not so much.

Slackers beware

Millions of hardworking people think Silicon Valley is inhabited by a bunch of slackers surrounded by half-eaten pizza boxes or traipsing around sleek buildings on a “campus” enroute to various counselling classes, personal massage sessions and other perks most hard-working people only dream of.

Apparently, there are limits.

Both Google CEO Sundar Pichai and Facebook/Meta CEO Mark Zuckerberg have put slackers on notice that there’s a change in the wind after several down quarters. (Read)

Google remains a buy in my book, especially if there are layoffs that will lower overhead and put the fear of actually having to work for a living into the workforce. Meta/Facebook, though, is still "avoid like the plague" status to my way of thinking.