Market Review: A Date with the DMV
We have just spent 30 minutes on hold in the Maryland DMV’s telephone system. Dealings with the DMV are always trying on the patience, and this phone call was no different. Rage was beginning to stir…
Six months ago we spent 90 minutes in a queue up in Towson’s DMV office. We’d gone there to score a Maryland I.D. card. Without an I.D. or a driver’s license, we’d been using our passport as a proof of age in the bars and nightclubs, and for obvious reasons, this was an unsatisfactory arrangement. We’d had to beg a colleague to go out of his way and give us a ride there, telling him we wouldn’t go out drinking with him any more if he declined to take us. He took us. The drive took 45 minutes.
We brought all the paperwork we could find. Three proofs of residence, two photo IDs, money, bank statement and a lease agreement. But when we finally got to the service window, the lady told us that, as a non-U.S. citizen, we should have made an appointment first and she couldn’t help us.
"Bloody Hell," we thought to ourselves. "You stupid, rigid, trained monkey. Damn, damn, damn you and your two inch gem-encrusted finger nails."
We knew it would happen. It always does. These people are totally incapable of thought, let alone informed decision-making. They can only think in rigid channels determined by their training, a bit like a computer. No exceptions. We hate the DMV and its employees.
We smiled. "Oh, isn’t that a shame. I just drove forty-five minutes to get here and I just waited in line for another ninety. Besides, I have a Green Card. I’m a resident."
"Are you a U.S. citizen, sir?"
"Well then I can’t help you. Would you like me to make an appointment for you, sir?"
"No thanks." (Translation: Eat my paperwork, you cow!)
Now we’re trying something even more ambitious. We’re trying to score a Maryland driver’s license. We approach it like a war. A struggle against the government.
Addison Wiggin says the U.S. government invented bureaucracy. "They are the red tape world champions," he always reminds us. "You should record how long it takes you."
For a foreigner, the process is slightly different. First, you have to attend a three-hour drug and alcohol awareness class followed by a quiz. If you pass, you get a certificate.
Then, you take your certificate, with two forms of photo ID and two proofs of address, your home country driver’s license, your green card and your social security number to the DMV.
Piece of cake…
We found the drug and alcohol course material on the Internet, available for free. We’d still have to show up to a test center in person to take the quiz and receive my certificate, but rather than sit in a classroom for three hours, we figured we could do the learning much faster online and then smash the quiz in 10 minutes.
What percent of homicides take place while the aggressor is under the influence of alcohol?
a. 50% to 60%
b. 75% to 90%
The drug that produces the most violence is:
Habitual alcohol dependency causes brain damage that eventually becomes irreversible.
Your emotional state of mind, such as fear, anger, stress and fatigue can influence the conditions of the stomach and the bowel, usually speeding the process of alcohol absorption.
We were right. This was much faster. We flicked through all five modules in 40 minutes, and the questions at the end of each one.
Which of the following actions allow people to sober up?
a. taking a cold shower
b. letting time pass
c. drinking strong coffee
d. all of the above
Long-term effects of marijuana can cause damage to each of the major organ systems in the body.
The use of amphetamines can:
a. Cause confusion
b. Cause inability to concentrate
c. Cause blurred vision
d. All the above
The main ingredient in marijuana is:
Crack is an especially dangerous drug because it can:
a. Induce fever, headaches, and low blood pressure
b. Cause intense dependency and addiction after a short period of time
c. Cause auditory, visual, time and other sensory disturbances
When alcohol and marijuana are used together:
a. They are more hazardous than using either substance alone.
b. They are less hazardous; they balance each other out.
c. It makes no difference if they are used alone or together.
Now we were ready for the test. Colleague Lisa Surino took us to a hotel out in the suburbs, and we made our way to the ballroom. All the other attendees had broken the law in some way…we could hear them bragging to each other: DUIs, points on their licenses, speeding tickets, that sort of thing.
We completed the test in 3 minutes-flat as the questions were identical to the ones above from the prep material.
We were the first person to finish our test and we took the answers to the invigilator. He quickly marked the paper…and horror of horrors, we got one question wrong:
Driving in Maryland is a:
We knew the answer of course, we’d just ticked the wrong box.
"You passed. Take this form to the lady in the black shirt."
We approached the lady in the black shirt. She was just putting the finishing touches to my certificate.
"How did you know I was going to pass?" I asked her.
"We hoped you’d pass…" And she put her hand out. "That’ll be $35 please."
The Daily Reckoning
April 03, 2005
P.S. Fleet Street Subscribers…Chris Mayer’s long awaited Special Report is now ready. He was preparing 6 new investment ideas – value plays extraordinaire – but apparently one died on the cutting room floor. So now it’s just five. Log in at www.fleetstreetltr.com
— Daily Reckoning Book Of The Week —
Bull’s Eye Investing: Targeting Real Returns in a Smoke and Mirrors Market by John Mauldin
This Book is simply the best and most enlightening investment book of the past 40 or so years…
THIS WEEK in THE DAILY RECKONING: Another fine selection of essays for you this week. My pick is Doug Casey’s…
VANDALS OF THE INTERNET 04/01/05
By Bill Bonner
"It seems as though media is taking over the world. But how far does a barrage of headlines get us? We’ve seen what became of the New Era. Whither, then, the Information Age?"
A SPECTACULAR BUBBLE 03/31/05
By Doug Casey
"Most Americans would be wary of visiting, or investing in any property that is located in the Middle East, no matter how beautiful and prosperous the area. Doug Casey tells us the location of this paradise should not be a drawback…"
DIVORCE AMERICAN STYLE 03/30/05
By Scott Burns and Laurence Kotlikoff
"Marriage is not an easy undertaking…but that’s not stopping Americans from trying (and failing miserably). In their book, The Coming Generational Storm, Scott Burns and Laurence Kotlikoff examine just how difficult marriage is…"
STRUCTURAL DRAGS 03/29/05
By Kurt Richebächer
"Many economists are still convinced of the United States’ economic strength…but the Good Doctor shows us that the U.S economy’s famous resilience is due to clever statistics and monetary looseness…"
ODIOUS MARKET_MANIPULATING REMEDIES 03/28/2005
By The Mogambo Guru
"The conspiracy theory the Mogambo has about evil people destroying the world with inflation, is true. We know, it’s hard to believe anyone who screams these theories late at
night from his roof, wearing only his underwear and a cape…"
FLOTSAM AND JETSAM: We stole Kevin Kerr’s weekly summary to his RTA subscribers…and published it here for you!
Dear RTA Member,
Well, well. We were right about the buildup in crude oil supplies. Now what? Simple: We make money. Seems easy, right? For those of you who have been with Resource Trade Alert since I became the editor last year, we have now had 17 winning trades in a row, and it will soon be 18 if our crude options continue to move higher. They closed yesterday at $1.48, and we paid only $1.08 just a few trading days ago. Not bad!
While I am very proud of the 17 (or soon 18) winning trades in a row, I never look at it in those terms, and neither should you. Look at things one trade at a time. For example, when I traded E-mini S&P futures a while back, I would make over 150 transactions a day, with the majority losing money. However, I would hold the winners longer, and not only did it make up the difference, but I would even come out profitable, albeit emotionally drained, at the end of the day.
So putting it in those terms, we are way, way ahead of the pack. For those of you who have just joined us and added the August $48 puts in crude oil, welcome. If this is your first trade, then I hope it’s the start of the next 17 in a row – but that’s the exception, not the norm.
We have three open positions, one of which was added to the portfolio before I joined RTA. These three trades were recommended with great potential, but into every portfolio, a little rain must fall.
OMI Corp. (OMM: NYSE) is an excellent shipping company, and my outlook for its shares is very bullish. We have held these options through thick and thin, and now time has essentially run out. The problem is not that OMI is a bad company. The problem is that the Dow overall has been weak, and this is pulling down shares in all sectors. Remember, options are funny animals – not only do they require us to be right about the general direction of the stock, but we need to be right within a certain time as well. As time value erodes, so does our option.
When we entered the option, on Dec. 10, 2004, we paid around $1.70. We are destined to recoup a little equity if the stock comes back a little in the next few days. I will be sending you another alert by Friday directing you what to do if you own these options.
No big deal. We can take the recovered equity and move onto something potentially more profitable. At the same time, those of you who bought the May corn options as part of a spread are still long the May $2.50 calls, which have been struggling to come back. No sense in keeping the calls and letting them erode away completely. We made good profits on the first half of the spread, so taking the remaining equity — if there is any — off the table is just smart trading. I will include instructions for those calls in the alert on Friday as well.
Please note: Many of you only have one of these positions, some have both and newer subscribers don’t have either. If you have any questions, ask your financial professional to see if you have these trades in your account, so you don’t accidentally execute an offsetting position. Again, I will give you all the details Friday. Until then, sit tight, and we will hope OMI and the others come back a bit more.
Moving onto gold… our June gold position has really taken it on the nose, too, but I am not ready to say goodbye just yet. This is the type of market, especially in this climate, that can turn on a dime. So hold the June gold $500 calls if you have them, and we will keep a close eye on them for you.
So much for the house cleaning. The good news about our $48 crude puts is that the inventory data this week showed another big buildup in crude oil, and we should certainly see further softening in the August crude. However, there is still a lot of bullish talk out there, and that makes me wonder whether we have a lot more downside here. We need to see the funds come in and sell it, but we didn’t really see that yesterday. No sense being greedy for profits we made this quickly. I am watching what happens in the Asian markets and, of course, today’s open. You may get a quick, urgent alert from me to simply grab those incredibly quick profits, and then we can reassess.
To new subscribers and veterans alike: I always love to receive feedback and questions. I can’t always answer readers individually, due to the sheer number of e-mails we get, but I try to answer questions in RTA as they come up. Please feel free to e-mail me.
We love to hear when you entered and exited the trades and what prices you got. In addition, if you’re a new subscriber having any trouble opening a trading account, absolutely let us know. And if you have any criticism, send it on. I am pretty thick skinned — working in the trading pits will do that. And of course, your accolades are also welcome — we appreciate knowing we are doing a good job. We would love to hear from you.
I will be writing to you again on Friday, and we can take action then. I am watching several other markets I like and picking out the next big mover. Stay tuned!
Yours for resource profits,
Kevin S. Kerr
And the Markets… (courtesy of the Rude Awakening)
WTI NYMEX CRUDE