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The case for pharma has less to do with tech and more with us not learning a dang thing

Oct 12, 2022

Good morning!

‍Wholesale prices are up but futures are running higher anyway.

I’m leery.

Here’s my playbook

Mind the fade: stay frosty!

The pattern lately has been to bid up – meaning buy and run stocks higher – as the cost of leverage decreases (the “tell” is the 2 and 10 year Treasuries which drop). Then hold the pattern just long enough to sweep the retail order book (meaning pick off limits and stops) before taking the indices negative again.

That’s the case this morning in the early going. The 2-year Treasury has dropped slightly to 4.314% around 0820 EST. The 10-year Treasury was little changed and trading at 3.945%. (Read)

What to watch for. A rise in the 10-year or 2-year or both would cause leveraged traders to reverse (again).

I suggest: 1) using any rally to shed stocks you don’t want; 2) any dip to accumulate stocks you do a little at a time; and 3) build hedges using simple inverse ETFs we talk about frequently.

If you don’t know what those are, how or why … Upgrade to paid

Inflation persists – like that’s a surprise??!!

Wholesale prices rose 0.4% more than expected in September.

Like that’s a surprise?!?!

My take with the fabulous Scott “the CowGuy” Shellady on his program yesterday (Watch) and earlier this week with the terrific Stuart Varney (Watch)

Inflation calculations aren’t worth the paper they’re printed on because they’re outmoded and built to measure an economy that no longer exists.

40 new dangerous virus labs under construction

There are apparently more than 40 labs under construction around the world being built explicitly to work with dangerous viruses. And, presumably, given who’s building many of ‘em, to weaponize that knowledge. (Read)

It would appear we’ve learned nothing.

If you’re not buying pharma, you may want to reconsider. Many pay great dividends, too.

UBER / LYFT: Your ride is about to get a lot more $$$$

The Biden Administration rolled out a proposal to reclassify contractors in the gig economy as employees. (Read)
Not surprisingly, UBER and LYFT tanked because already slim margins are going to get vaporized if the move sticks. Oh, and your ride is about to get a whole lot more expensive, too.
Big government = smaller wallet every time.

Sigh.

Not quite a fire sale, but close $PTON

Peloton could charge a premium for its bikes then tell customers to wait months for delivery.

Now it’s having trouble giving away the farm. The company has recently announced that it’s selling through Dick’s Sporting Goods, giving away free test access, and selling at a discount via Amazon Prime Early Access. (Read)

It’s still a $2 stock.