My Gut Feeling 2015

Scott Rothbort

January 01, 2015

My Gut Feeling For Today, December 28, 2015: The Force Awakens – In the Theaters Not the Market

The bipolar market activity continued over the past two weeks. Two weeks ago, following the FOMC decision, in light of ever lower commodity prices, the equity markets got hit hard. Last week, as if the week prior to that did not exist, markets rose handsomely. All said and done, the S&P 500 (SPX) ended the week two index points higher for the year or just about 0.1%. As I have written and said many times before, 2015 is shaping up to be a repeat of 2011. With four trading days remaining, it seems that will turn out to be fact rather than speculation.

Not much has worked this year, with one exception – dividend oriented stocks, excluding master limited partnerships or MLPs which were taken apart with the rest of the energy complex. Even Apple (AAPL) declined about 2% this year despite a spectacular rise in earnings of 43%.

2015 has been highlighted by record reported mergers and acquisitions but the initial public offering (IPO) market was very disappointing.

The last four days of this year for most managers won't pass quick enough and we (me included) cannot wait to wipe the slate clean for 2016. I am not expecting much to take place other than some window dressing and last minute tax selling over these next four trading days.

One important milestone was reached. That was the box office receipts for Disney’s (DIS) Stars Wars Episode VII – The Force Awakens. That latest chapter of the Star Wars franchise was the fastest to earn $1 billion at the box office. We saw it Friday afternoon and it was excellent. DIS stock is up for the year but has gotten cut down by a light sabre the past few months. Expect the company's board to put The Force Awakens proceeds to good work for shareholders by either or both increasing dividends or stock buybacks.

I have already published my annual list of 10 Things I Won't Miss. Next week I will return with My Gut Feeling for 2015 – A Look Back and My Gut Feeling for 2016. My best wishes for a happy, healthy, prosperous and safe New Year.

__________________________________________________________________

Disclosure:For informational purposes only. At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL & DIS — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC a investment advisor representative of Kingswood Wealth Advisors LLC,specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company

10 Things I Won’t Miss About 2015

Every year since 2002 I have closed out the year with my satirical look at the world through the eyes of a professional investor / writer poking fun at what has transpired in our global society during the year we are about to turn the page on. 2015 has brought forth its own unique series of unexpected news, celebration, joy, disappointment, tragedy and political intrigue. I hope that 2016 will be a year of health, happiness and prosperity to all of the members of my family, clientele, students, co-workers and readers. So without further ado, here is my List of 10 Things I Won’t Miss About 2015 (and never want to see or hear about ever again), in no particular order:

PEOPLE WHO SPEAK IN HASHTAGS – Communication skills are on the decline due to social networking and the increasing use of smartphones or other hand held devices. That I can accept. However, when people (you know what age group I am talking about) speak using hashtags, I get annoyed. The conversation goes something like this: “I want pizza for dinner – hashtag iwantpizza.” I got the message, so why do I have to go to Twitter (TWTR) to find out what you meant.
SPOILED WHINY COLLEGE STUDENTS – My wife and I have five children all of which we are very proud. Our eldest son is an attorney. Or eldest daughter is a nurse. Our middle child is a graphic designer for the iHome company (they make fantastic products). Our fourth child and middle son is a senior at UNLV studying hospitality and hotel management. Our youngest just began to study psychology at Purdue and wants to pursue a career in diabetic counseling. My wife and I focused our children on career paths, of their own choosing, before they ventured off to college (in four different states no less, five if you include law school) and spent hundreds of thousands of our dollars. I worked multiple jobs to help put myself through the University of Pennsylvania’s Wharton School of Business and New York University’s Stern School of Business. We do not mind spending hard earned money on quality education with a purpose. However, when I hear the demands of students for free education and loan forgiveness I get real upset. Just listen to this interview between Neil Cavuto of Fox Business (FOXA) and the leader of a national student movement. Don’t even get me started on the anti-microagression movement and growing institutionalization of anti-Semitism on college campuses.
FINAL COUNTDOWN COMMERCIAL - Every year there is one commercial that is so bad and annoying that you would rather poke a sharp stick in your eye than have to endure the advertisement. This year’s award goes to Geico; owned by Berkshire Hathaway (BRK/A; BRK/B); for the company’s Final Countdown commercial sung by 80s glam metal band Europe. Even the Geico Gecko has to stick his fingers in this ears when this commercial airs. Without a doubt, the best commercial of 2015 and one of the classiest one in years is the You Never Know Who You’ll Meet at Barnes & Nobel spot with Tony Bennett & Lady Gaga singing a marvelous version of “Baby It’s Cold Outside” duet. I can’t get enough of that commercial.
FIFA / OLYMPICS – Soccer, I mean non-American football is a mess. FIFA is a multinational organized crime venture. It ought to be disbanded. The Olympic movement, born to give opportunity to amateur athletes, especially in non-commercial sports is bankrupting nations. Just look at what happened to Greece, Russian and soon to be Brazil as a result of billions of dollars (or euros or rubles, etc.) spent on these lavish events. Increasingly, cities are rejecting the opportunity to submit bids for Olympic events because citizens are getting fed up with footing the bill for overpriced corrupt multination sporting events. Boston and Hamburg are just two recent examples. Stop blaming the 1%ers for societal problems and point a finger at these two organizations.
GOING PAPERLESS – I am sick and tired about being asked to go paperless, especially after I already responded no to a request. Do you know that the court system, Internal Revenue Service, mortgage companies, retailers and many other organizations that we have to deal with on a daily basis in our lives, demand paper documentation as evidence? Have you dealt with the hassle of retrieving or printing old legacy statements? So, if you don’t mind, I will keep my records the old fashioned way – on paper – and stop bothering me to go paperless.
PUMPKIN SPICING – First the cronut took over our salivary glands. Then kale commandeered our menus. In 2015, it was pumpkin spicing that controlled foods and beverages. Tell me this – why did everything we consume seem to have to be enhanced with pumpkin flavoring? I enjoy a nice slice of pumpkin pie every now and then, although it is way behind key lime, pecan and cherry on my list of pie favorites. 2015 will mark the beginning and end of the great pumpkin craze.
STEVE JOBS MOVIES – Wasn’t one bad Steve Jobs movie enough? No, Hollywood had to bring us another one in 2015. His legacy lives in his company, Apple (AAPL) and does not need any movies.
BAD MAYORS – Mayors Rudy Giuliani and Michael Bloomberg not only cleaned up Times Square but did so for the entire city. Under their administrations, squeegee people no longer harassed drivers. Trust me it was harassment. Times Square was turned from a dangerous section of the city littered with XXX movie theaters, peep shows, prostitutes and muggers into a glitzy, thriving, safe tourist destination. It became Disney (DIS) safe. Under Mayor Bill de Blasio, the Big Apple has taken a step in the wrong direction in many aspects – homelessness, crime, etc. You can argue if you want whether it was his fault or something he inherited from his predecessor (I think it is de Blasio’s fault). However, you can pin one thing on de Blasio – the naked ladies running around Time Square. When I think of de Blasio; Mayor John V. Lindsay comes to mind and we all know how much of a disaster he was as mayor. Then there is Chicago’s mayor, Rahm Emanuel. His administration suppressed videos of the killing of Laquan McDonald during his reelection campaign. Emanuel resides over a city with the worst murder rate in the country. Just as it was under Al Capone, gangs are running Chicago once again. Next is the entire San Francisco government who refuses to see the problems inherent in its sanctuary city policy. Finally, Baltimore Mayor Stephanie Rawlings-Blake was deemed so incompetent in dealing with the city’s riots that she realized that her political career was over and announced that she would not seek reelection. That sort of makes her the Lyndon Baines Johnson of mayors
CAITLYN JENNER – Just when you thought we had enough of the Kardashians, along comes Bruce, I mean Caitlyn Jenner. At least Bruce, in his Olympic heyday had some talent worth watching. Of course, that was when the Olympics were still for amateurs.
FEDERAL RESERVE TIGHTENING – enough is enough already. Rates were at zero for seven years. They had nowhere to go but up and the time was right. The time and energy wasted as to when the Federal Reserve Open Market Committee (FOMC) would raise rates in 2015 was just unbearable.

I hope you enjoyed this year’s 10 Things and thank you for reading My Gut Feeling. LakeView Asset Management is always available to help you with your investment needs, so don't be shy to reach out to me.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL & DIS — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, December 17, 2015: Finally, No More ZIRP

Finally the FOMC delivered its long overdue and widely expected increase in interest rates. It was the most telegraphed interest rate hike in the history of central banking. We can now say that the FOMC has exited the era of ZIRP (zero interest rate policy). That is not to say that the monetary authority is not being accommodating on policy. At ¼%, the FOMC’s target Fed Funds Rate is still quite stimulative.

All told, the FOMC removed a major overhang of uncertainty from the markets. Initially the stock market opened higher yesterday, then went back to near neutral until the FOMC decision, only to skyrocket after Chairwoman Janet Yellen’s remarks; which promised a slow and steady approach to moving rates back to a long term neutral stance.

With tomorrow's quarterly derivative expiration, plenty of misguided bears, traders and hedge funds were caught too short after last week’s sell-off and too long bearish put options. Furthermore, investors who were sitting on cash, especially pension funds were able to go bargain hunting. Early in the day’s session I put on a seasonal overlay in the ProShares Ultra Dow 30 (ETF (DDM). By the closing bell, the S&P 500 (SPX) went back into positive territory for 2015.

Several brokers and money managers (at least three) I spoke with yesterday, offered up to me the fact that they were actively looking at closed ended bond funds which have been obliterated lately; especially in light of Third Avenue’s fund failure. I have been doing the same. There are several well managed funds that could offer some decent yield at an unusually high discounts. Unfortunately, many of those funds went ex-dividend on December 16, so there is no rush. Many do pay on a monthly basis.

So, it looks like we have lift-off for the Santa Clause rally. "Now Dow (DJIA)! Now S&P 500 (SPX)! Now, NASDAQ (NDX) and Russell (RUT)! On, Apple (AAPL)! On, Alphabet (GOOGL)! On, Zoe's (ZOES) and Visa (V)! To the top of the range! To the top of the highs! Now dash away! Dash away! Dash away all!"

We are headed back west to Nevada for the winter. Follow our travels on Facebook (FB). I will be back in the middle of next week with commentary and of course my annual list of 10 Things I Won't Miss.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, DDM, GOOGL, TQQQ, V & ZOES, — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, December 15, 2015: The Four Cs Are a Market Cancer

You can sum up 2015 as the year in which the four dreaded Cs have inhibited the stock market from gaining any ground. Those four Cs are: Credit Markets, Crude Oil, Currency, and Congress. Throughout history, those four Cs have served as the battering ram for the stock market. There is one exception: the popping of the tech / dot.com bubble in 2000 which was indeed caused by stocks.

2015 has been no different. Throughout this year, any attempt at sustaining a rally for the stock market has been foiled by: the currency markets – strong US Dollar, Chinese devaluation; Crude Oil and Commodity market crash; Congress’ failure to reduce spending and debt and now, a crisis in the Credit Markets. None of those “C” factors have their genesis in public corporations’ operations; nevertheless, the stock market gets hit with collateral damage.

The high yield or junk bond market came to a screeching halt last week when Third Avenue halted redemptions in its Focused Credit Fund. This company was founded by legendary investor, Marty Whitman. Many other leveraged credit hedge funds have also recently closed their doors. Of course, the Dodd-Frank Act did not help matters as it prohibited banks and brokers from creating the necessary liquidity safety net to meet fund asset liquidations.

Did I mention that the stock market suffers from dementia? No wonder when it is takes a pounding from credit, currency, crude oil, commodity and Congressional induced concussions. On Friday, the stock market got pummeled when crude oil sank to new multi-year lows. Then yesterday, the pummeling continued until crude oil caught a bid midday and turned positive.

What do the credit, commodity, currency and crude oil markets all have in common? Massive leverage. More leverage than the stock market. After all, according to Federal Reserve regulation T, you can only borrow up to 50% of the value of stocks when making a stock purchase. Of course, most people do not use margin to leverage up, so the total leverage in the equity markets is quite small compared to the overall market capitalization. Crude oil futures require $5,000 of collateral (initial margin) to control 1,000 barrels of NYMEX Crude Oil, which at current prices equate to about 7.2 to 1 leverage. In the bond market you can put up as little as $1 to control $100 of bonds.

Yet, the common misconception is that stocks are the most risky asset class. 2015 has been horrible for stocks, declining a little bit. However for those Cs, it has been a major disaster. Stocks are fair to undervalued on a trailing basis and undervalued on a forward basis. I cannot say the same for the other Cs.

I suspect that the markets bottomed yesterday and put in a floor from which the Santa Claus rally can spring forth from. However, we still have to deal with Wednesday’s FOMC decision and Friday’s quarterly derivative expiration. Of course, you never know what surprises the four Cs may spring on us.

____________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC held no positions in stocks mentioned; although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, December 10, 2015: Markets Suffer From Dementia

My colleague Doug Kass of Seabreeze Partners has a saying, “the market has no memory from day to day.” Unfortunately, if you observed the markets the past few days, you would be convinced, as am I; that the markets are suffering from dementia.

Last Thursday the S&P 500 (SPX) experienced a nasty sell-off. On Friday the SPX experienced a massive rally. On Monday the index opened lower and then after about two hours of trading bottomed only to close well off of the lows. On Tuesday, the SPX opened sharply lower, bottomed in the first hour and then just like on Monday closed well off the lows. Yesterday, an early rally got sold hard but made up some lost ground in the final hour of trading. Why did this all occur? Frankly for no particular reason.

Perhaps we are getting some pre-FOMC jitters. Add to that derivative players jockeying for position on expiration which occurs two days after the FOMC decision. Given that the markets have experienced some sort of dementia all year long, what we are also seeing are professional managers taking tax losses to get losers off the books and then; offsetting some of those losses by trimming back on this year’s winners. Certainly, volatility seems to be getting pumped up this past week. Thus, we can expect more of this nonsense in the markets the next week or so.

As I have said repeatedly – “it feels like 2011 all over again.” Just take a look at the chart below, focusing on 2011 and 2015. In both of those years, the SPX traded nearly identical to each other with early bullish action, however mild; followed by an August – September correction; and, then closing nearly flat on the year. So, 2015 being much like 2011 is the bad news. The good news is what happened from 2012 through 2014, the S&P 500 (SPX) rallied impressively. Potentially, we have that to look forward to once 2016 begins. Recall that in my opinion that the secular equity bull market began in 2012. Secular bull markets tend to last 10 – 15 years but never go up in a straight line.

(Source: Telemet)

My Gut Feeling For Today, December 8, 2015: No Hanukah Miracle in the Oil Patch

After Friday’s moonshot in the equity markets in response to the November’s jobs report, we were all set up for a Hanukah rally on Monday. Unfortunately, unlike the ancient Hebrews who miraculously turned one day of oil into an eight day supply, the modern oil patch did not produce any Hanukah miracle.

Rather, the OPEC nations decided to continue to flood the market with crude oil, sending Brent crude oil prices tumbling. Here in the USA, NYMEX crude oil dropped nearly six percent to $37.65, a level not seen since the depths of the Great Recession. Of course, that took energy shares lower which took the rest of the market for the ride into the toilet. Small cap and growth stocks felt the most pain with the tech laden NASDAQ 100 (NDX) the best performer of the major indexes. The S&P 500 (SPX) and other indexes did rally off of the day’s lows. The SPX closed 0.7% in the red after shedding nearly 1.2% at its worst levels of the day.

With crude oil prices down close to 30% for the year, one would think that secondary benefits of lower prices would be flowing through to the economy. It is, but about 12% of that decline is due to the stronger US Dollar. Currency strength has in turn hurt US corporate profits. Furthermore, while the US consumer feels the benefit from lower commodity prices, that savings is going to pay college costs, reduce debt or purchase large ticket items – cars and home appliances – or to remodel existing or buy new homes. We are not seeing an explosion of consumer spending on other discretionary purchases such as apparel, travel or restaurants which one would expect given lower commodity prices. Perhaps there will be a delayed effect in discretionary spending which will get a boost in 2016.

I discussed Chipotle Mexican Grill (CMG) and the restaurant industry in general on Bloomberg Radio last Friday. However, on Monday, that company lowered the boom on guidance as the company’s E.coli woes continue to impact operations. You can read more of my thoughts on that subject in a free issue of my newsletter, The LakeView Restaurant & Food Chain report which can be found on Scutify.

Also, on Friday, I was interviewed by Christine Sloan of CBS TV New York on the economic impact of increases on Port Authority of NY & NJ bridge and tunnel toll hikes.

Hanukah sameah to all. I went off my diet by consuming too many potato pancakes and a donut (at least I stuck to just one). Enjoy the fourth installment of Adam Sandler’s Hanukah Song.

[embed]https://www.youtube.com/watch?v=6YSOZP_M6eM[/embed]

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long CMG & TQQQ— although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

___________________________________________________________________

My Gut Feeling For Today, December 4, 2015: Euro Strength Mistakenly Frustrates Markets

For two consecutive days, following a strong start to the month of December, the markets tried to rally early, only to get kicked down a flight of stairs. On Wednesday, the terrorist attack in California sent shock waves through the markets. Then yesterday, we endured a teeter-totter pre-market and first two hours of the trading day only to sell off hard the rest of the day.

Thursday’s excuse for the sell-off was the market disappointment of the European Central Bank’s interest rate decision. Apparently, global investors were expecting Mario Draghi to be more aggressive with monetary policy. Janet Yellen’s testimony to Congress did not help matters either. What was surprising is that the Euro strengthened versus the Dollar. Even more surprising is that the markets did not take that as a positive sign, because after all, for the last year, a stronger Dollar was the proximate cause for lackluster US multinational earnings. Bottom line: markets are irrational in the short run.

There was an interesting bit of stock market trivia I was able to ascertain today. The Standard & Poor’s 500 Index (SPX) has now turned red for December 2015. It declined in December 2014 as well. Not since 1980 and 1981 has the SPX declined 2 consecutive Decembers. We still have nineteen trading sessions left to the year, so anything can happen. However, I just keep on getting that 2011 feeling all over again which would put the SPX at even for the year and in the red for December.

Today we have to contend with the Bureau of Labor Statistics jobs report for November. Wall Street economists expect 200,000 non-farm job additions for the month. As always this is going to be unpredictable, both in terms of the actual data point and the market’s reaction.

Lastly, I published an article on how to invest in Fantasy Sports on MarketWatch.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC held no positions in stocks mentioned; although positions can change at any time.

Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC

– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, December 2, 2015: Holiday Sales Kick Off According to Expectations

Black Friday, Cyber Monday and the commencement of the holiday shopping season have kept me rather busy with the media. Seton Hall University has done a nice job summarizing some of those articles and interviews as of Monday. Then yesterday, an interview with NJ.com was also published. My own anecdotal research indicates that Thanksgiving evening was a bit slow for mall traffic, which came as no surprise. Unfortunately I had a funeral for a dear friend’s mother on Friday and could not drive to or by any malls. Sunday afternoon and evening we took the kids shopping at Jersey Gardens which was packed. Though, it did appear that apparel sales were sluggish while footwear was strong. This is also consistent with my expectations.

As for the markets, November ended on a down note but the S&P 500 (SPX) managed to eke out a one point gain for the month. Nine out of eleven months in 2015 ended with the final trading session lower for the SPX this year, with the exception of June and September. With yesterday’s strong start to the month of December, eight of the twelve first trading days of the month this year were positive sessions for the SPX. The index is now 1.7% away from its all-time and 2015 high.

Overnight there was some stock news. Yahoo (YHOO) is exploring the sale of its core internet business. While the stock surged over 7% on the announcement yesterday evening, this morning the stock consolidated those gains and appears to indicate about a 3% rise when the market opens. It is clear that Marissa Mayer is yet another failed CEO in a long list of over-hyped false messiahs. Cabela’s (CAB) is reported to have hired Guggenheim partners to “explore strategic options” which is Wall Street talk for putting itself up for sale, merger or create a spin-off. CAB is rising over 4% on the news. I suspect that it will have a positive effect on competitors Dicks Sporting Goods (DKS) and Hibbett Sports (HIBB).

Eyes and ears will be on Janet Yellen who is expected to begin a two-day series of lectures and testimonies. Today the FOMC Chairwoman will be at the Economic Club of Washington and tomorrow on Capitol Hill. The markets, as I have mentioned have accepted the fact that the FOMC will nudge interest rates off of zero to one-quarter percent. Hence, I do not expect any earth shattering news from Yellen, but just more academic lecturing. All of this will be a precursor to Friday’s labor report.

The markets of late have had a positive bias but seem to be moving in fits and starts with a few positively solid sessions interspersed by several lackluster days. Yesterday was a solid performance and despite a nice rally in China, I expect a sluggish follow through in the states today.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long DKS — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, November 23, 2015: Sticking With Large Caps During Period of Seasonality

Friday capped off an impressive week for the equity markets. As I suspected, we got follow through to the upside on both Thursday and Friday. The two proximate causes were better than expected retail sales and the impact of options expiry.

Leading the way in the retail sector were home improvement, discount chains and sporting good apparel. One of the highlights was Nike (NKE) which reported significantly better than expected results and then topped that report off with a $12 billion share buyback and stock split. NKE strong results were confirmed by Foot Locker's (FL) own positive report. However, many mall based operators remain laggards as evidenced by Macy’s (M) and Nordstrom (JWN). As I outlined in my article on The Death of the American Mall, there is a secular shift in the way in which retail shopping is taking place.

Of course, this week we will be inundated by commercials, advertisements and media reports on Black Friday and the commencement of the holiday shopping season. I have to say that having studied and observed the Black Friday phenomenon for many years, I think that the event peaked in importance to retailers a few years ago.

What Thanksgiving week does bring is the beginning of a positively biased period of seasonality which extends into the first quarter of the following year. While the large and mega cap indexes have been performing well, nearly regaining all ground lost for the year, the S&P MidCap 400 (SML), S&P Small Cap 600 (SML) and Russell 2000 (RUT) indexes have not fared as well. What is interesting is that this seasonally positive period is typically most beneficial to smaller capitalization stocks. So, the question remains, will small caps outperform large caps over the next two months? My Gut Feeling is that they will not, it will be an off year for small caps and we plan to stick to the larger cap stocks and indexes.

Wednesday is a slow day for the markets, Thursday is Thanksgiving and Friday is a half trading day. Enjoy your holiday and I will be back next Monday with more commentary.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long FL — although positions can change at any time.

– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC

– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, November 19, 2015: Finally, Markets Accept Rate Hike

The Federal Reserve Open Market Committee October meeting minutes were released in the afternoon and received with applause from the markets. Markets were already higher going into the release and then surged afterward. The message was clear that the FOMC is likely to raise interest rates in the short end modestly in December for the first tightening action since August 2007. Equity market participants finally accepted the inevitable and concluded that a slight rise in rates was not going to spell the end of the secular bull market in stocks. Bonds were flat to slightly down on the news.

We are likely to see some positive follow through in today’s session. Although, the options expiration effect may kick in toward the close and into tomorrow’s session. Given that equities have surged over the past two sessions, many hedge funds, who tend to be short delta and gamma (that’s options Greek geek speak for risk) are getting squeezed as the markets rise and will be forced to cover shorts either today or tomorrow.

Tech stocks were on fire today thanks to a Goldman Sachs (GS) upgrade of Apple (AAPL). The S&P 500 (SPX) and Nasdaq 100 (NDX) have made up most of last week’s losses. It is my guess that by the time we sit down to eat turkey next week the indexes will recapture all of that lost ground and then maybe rise even more.

Keep an eye on MarketWatch’s Trading Deck today. I expect to have an article on "The Death of the American Mall" published during the day. I will provide a link on Monday in case you could not catch it before then.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL & TQQQ — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, November 18, 2015: Don’t Fear Post Paris Jitters

I expected a jittery Monday morning which is what occurred with futures lower overnight and into the market open. Also as I expected, a bottom was put in place Monday morning and a nice rally ensued thereafter. That rally extended into Tuesday’s session until the market got post-Paris terrorist attack jitters. First there was the cancellation of a soccer match in Germany due to bomb threats which was followed up by an incident on a British Air flight from London to Boston. As it turned out, the culprit was an inebriated passenger who tried to enter the cockpit. Yet, the damage was done, early gains were erased and the markets closed flat.

These post hoc terrorist event jitters have unfortunately become commonplace. It happened after 9/11, the Boston Marathon bombings and the Paris terrorist attack. Since people are so scarred by these events and the markets tend to be on high alert, any possible follow-on event is treated as real until proven otherwise. You have to be steadfast and learn not to get sucked in by breaking news or headline events of post-hoc terrorist event news.

Retail earnings continued to pour in and the story remains the same. Any retailer with an apparel based business model got smacked and any retailer with a home based theme performed well. There are exceptions such as Kohl’s (KSS) and TJX (TJX) which bucked the trend, likely due to being on the discount end of the business. Wal-Mart (WMT) which sells a bit of everything rose 3.5% after bettering Wall Street expectations by 5 cents.

However, you have to understand the estimates-guidance-earnings game to appreciate what occurred with WMT. WMT several weeks ago guided to lower earnings expectations. Analysts’ consensus estimates originally called for WMT to earn $1.08. That was lowered to 98 cents after WMT provided weak guidance. Then WMT announced earnings of $1.03. Let me put this in terms that most people will relate to.

Say you tell your child that you expect an “A” in math. Your child, knowing that they will not get an “A” tells you that they are not doing well and will likely get a “C”. While you are not happy, at least you will try to get the child help and you hope that it does not turn into a “D”. Your child though, actually expected to get a “B” and indeed does so. You are thrilled that the child did better than expected and pleased that the help you got for them paid off. Now you see how the game is played by corporate management and analysts.

We have some more earnings reports today, highlighted by Lowes (LOW) and Target (TGT), although Salesforce (CRM) and Keurig Green Mountain (GMCR) will be the most entertaining. Then in the afternoon the October FOMC meeting minutes will be released which always stirs up some volatility. As we look ahead to the rest of the week, the Philly Fed and Leading Economic Indicators (LEI) are released on Thursday, and Friday is monthly options expiration. Anything I mentioned that will transpire over the next three days can ignite a rally or send the markets lower, so stay tuned.

___________________________________________________________________

My Gut Feeling For Today, November 16, 2015: Buy On the Sound of Cannons

To say the least, last week was rather ugly. It started out with profit taking which, rightly or wrongly, was attributed to continued fears of the FOMC raising interest rates. Then midweek, retail earnings from Macy’s (M) and other retailers spooked the market, sending fears of an economic slowdown throughout Wall Street. Finally, later in the week, tumbling commodity prices sent stocks even lower. Altogether, this added to the frustrating year which money managers and investors have experienced in 2015.

Let’s take these on one at a time. A small increase in interest rates should not be feared nor should it come as any surprise. Yet, it seems to fester like a bad case of herpes. As for retail earnings, American consumers are not spending less but they are spending their discretionary money differently. I am about to publish an article on MarketWatch detailing my theory on the Death of the American Mall to expand upon what I discussed on WSJ Podcasts and Bloomberg Radio last week. Finally, declining commodity prices send two juxtapose messages. On the bullish side, declining commodity prices equate to cheaper input costs and lower inflationary pressures. On the other hand, declining commodity prices may indicate slowing demand. However, in the case of crude oil, demand is rising but surging supplies are outstripping the increase in demand. Put all together, we have now built a new proverbial wall of worry upon which the markets will eventually scale to greater heights.

Then on Friday afternoon (on the East Coast of the US), radical Islamic terrorists in a series of coordinated attacks struck at various venues in Paris killing 129 innocent people and injuring many more. ISIS claimed responsibility for the terrorist act. This is yet another brick in that wall of worry.

Immediately after the news of the Parisian terrorist attacks reached our televisions and smartphones, which was after the markets closed, stock futures sold off. Last evening, futures opened nearly 1% lower but by midnight today had only declined about 0.45%. There is an old adage which is attributed to 19th century British financier Nathan Mayer Rothschild that states: "buy on the sound of cannons, sell on the sound of trumpets" I believe that the Paris terrorist attack is a perfect example of what Rothschild meant by "buy on the sound of cannons." Hence we should experience a jittery morning but by this afternoon or Tuesday, a bottom to the recent market pullback may be in place and you can be a buyer of stocks.

___________________________________________________________

My Gut Feeling For Today, November 11, 2015: McDonald’s Nixing REIT is a Mistake

Yesterday, the equity markets ended a four day losing streak, which in my opinion was nothing more than a bout of profit taking. All told, the S&P 500 (SPX) gave up just over 1% during that period of time.

Priceline (PCLN), one of our top holdings, declined 9.6% after reporting better than expected earnings. Priceline always seems to beat earnings estimates and then provides low ball forward guidance. The company is the best managed in its industry and sells at a discount to its peers. You are getting a great opportunity to start or add to positions. My 2016 price target is $1,650.

McDonald’s (MCD) announced that the company would be cutting expenses and boost its dividend. I expected the dividend increase but it was about two months late in being announced, so to some, especially in the media, it came as a surprise. What was a surprise is that management put the kibosh on splitting into a separate operating company and real estate investment trust (REIT). I think this is a mistake. MCD is one of if not the largest real estate businesses in the world. It just happens to sell food and franchise its restaurant business model. Splitting into two companies would unlock shareholders value and be more tax efficient in the process.

Above average paying dividend stocks continued to get hit hard on Monday but rebounded on Tuesday. A 1/4 % increase in interest rates will not have a significant impact on those stocks as it will not entice investors to shift money to long-term bonds. We are just seeing a knee-jerk reaction to what is certain to be a December interest rate hike. Again, you are getting some great entry points due to markets over selling.

We are coming down to the last forty trading sessions of the year. This is normally a positively biased season for the stock markets. I am expecting much of the same through the end of the year, even if the FOMC raises rates ¼% in December.

In case you missed my Bloomberg radio interview on Monday, you can access it here. Also today from 3:00 to 5:00 PM I will be conducting a free Ask Me Anything session on Scutify. Feel free to join in.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MCD & PCLN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, November 9, 2015: Berkshire Hathaway Gains Hide Losses

271,000 jobs were created in the United States according to the Bureau of Labor Statistics. This data point far exceeded Wall Street expectations of 181,000 non-farm payroll additions. The market reaction was rather blasé. That is except for high dividend paying stocks which got taken to the woodshed for fear that now, finally, the FOMC would raise rates come December. Enough already with the rate rise fear. It will happen, we all know that, but these periodic tantrums that the markets throw is just plain stupid.

Over the weekend, Weyerhaeuser (WY) agreed to buy Plum Creek Timber (PCL) for 1.60 WY shares per 1 PCL share. As it turns out, we hold PCL in our Low Volatility / High Dividend strategy. That stocks yields 4.37%. PCL was one of those stock that got clobbered on Friday, by 1.90%. Based on Friday’s WY closing price of $30.40, PCL should rise in value by 21%. However, we know that it will be somewhat less as arbitrageurs will short sell WY a little. Still, it will be a nice lift to the Low Volatility / High Dividend Portfolio, our fastest growing client strategy. So much for fear of rising rates.

Late Friday, Berkshire Hathaway (BRK/A) reported its quarterly results. Thanks to Warren Buffett’s financial engineering of Kraft Heinz, Berkshire Hathaway recorded a $6.8 billion pre-tax and $4.4 billion after tax gain on the Kraft – Heinz merger. This hid weakness in Berkshire Hathaway’s main insurance business and large declines in the company’s holdings of International Business Machines (IBM), American Express (AXP) and Wal-Mart (WMT) this year.

Today I will be on Bloomberg Radio’s Taking Stock show at 3:45 PM. You can tune in on WBBR 1130AM New York, Bloomberg 1200AM and 94.5FM-HD2 Boston, Bloomberg 960 AM and 103.7 FM-HD2 San Francisco, Bloomberg.com, and Sirius/XM channel 119.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long PCL — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, November 6, 2015: Facebook is Larger Than General Electric

The markets have continued to ascend from the depths of the August / September double bottom correction. Even after some mild declines on Thursday, as money sat on the sidelines awaiting Friday’s labor report, the S&P 500 (SPX) was a hair under 2,100 and is within 2% of its all-time high set earlier this year.

The bears really have plenty of egg on their faces. Remember their resounding calls for a bear market after a “crash” in August. Nothing could be further from the truth. Earnings season has dispelled any notion that we are heading into an earnings or economic recession. That being said, this year has not been all fun and games and stock pickers have had a difficult time despite the SPX being up about 2% this year.

Today we will receive the labor report for the month of October. As has been the case for many months, the problem will not be a lack of job creation but rather the comparison of economists’ forecasts with the actual change in non-farm payrolls. Collectively that forecast calls for 181,000 additional non-farm jobs hiring in the month of October. This compares with 142,000 new jobs in September, although that number is likely to be revised higher.

After reporting results on Wednesday, Facebook (FB) shares rose to an all-time high of $110.65 before closing at $108.76. The company in the process has surpassed the market capitalization of General Electric (GE).

I will be spending today in Manhattan at a conference at the New York Stock Exchange. Later in the day I will be interviewed by ABC News Radio. Then on Monday I will be on Bloomberg Radio’s Taking Stock show at 3:45 PM. You can tune in on WBBR 1130AM New York, Bloomberg 1200AM and 94.5FM-HD2 Boston, Bloomberg 960 AM and 103.7 FM-HD2 San Francisco, Bloomberg.com, and Sirius/XM channel 119.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long FB — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

___________________________________________________________________

My Gut Feeling For Today, November 4, 2015: If Its November It Must Be Retail Month

It is nice to be back to writing after recuperating from my hand surgery. Today was the first day that I could type with both hands. The surgery went well and after lunch today I should have the stitches removed. However, like the Mets, I am going to have to wait till spring to get back to baseball.

Speaking of the Mets, they were clearly a good team but no match for the Royals. What the Mets need to do is repeat their 2015 success and exhibit just a little improvement to get the Amazins over the top in 2016. Unfortunately the club has a history of one and done appearances in the World Series – win or lose.

We have three busy weeks ahead of us. This week October's jobs report is revealed on Friday, which as usual delivers its own brand of market volatility. Then the retail sector’s earnings report period begins next week and gets real crazed the week of November 16. That will then lead us to the much overhyped run up to Black Friday and the holiday earnings season.

I am seeing some clear trends in retail which I would like to lay out for my readers:

The American shopping mall as we have come to know it is dying. There are several reasons for this opinion. To begin with, they are no longer destinations for American teenagers as was the case when I was growing up in the 1970s. Second, many of these malls, especially in middle class towns were anchored by big box retailers such as Macy’s (M), Lord & Taylor, JC Penney (JCP), and Sears (SHLD), to name a few. JCP and SHLD are both struggling to survive, losing much of their business to WalMart (WMT), Target (TGT) and Amazon.com (AMZN). Lastly, mall traffic is now flowing to outlet centers where many upscale retailers have discount stores. Such centers are operated by REITs such as Tanger Factory Outlet (SKT) and Simon Property Group (SPG).
Increasing uncertainty in weather patterns across the nation have made it more difficult for Americans to plan ahead for seasonal apparel purchases. I am not getting into the global warming or climate change debate. However, one year we have a hot dry summer and the next a cooler wet one. One year we have a cold winter without much snow and the next one milder but with heavy winter storms. Simply put, the variability in weather from year to year has put apparel buying decisions on the sidelines. On top of that, there is an increasing migration to southern and western states. When living in New Jersey, we needed two wardrobes and outwear for many different conditions. Now living in Henderson, outside of Las Vegas, we have one wardrobe with the big decisions hinging on whether to wear long or short pants and is a light jacket needed.
Teen, tweens and young adults have less disposable income now more than ever. It is bad enough for retailers that this is the most fickle age demographic. Add to that the heavy debt load from student loans, the age of first marriage at all-time highs and young adults living with their parents longer than ever; and it becomes easy to conclude that discretionary spending by teen, tweens and young adults is stunted.

It is fair to say that we will see some of the above reflected in retail earnings over the next few weeks. Also, wage and other pressures and the strong US Dollar are going to hurt the retail sector. I expect expectations for the holiday season to be tempered by retail management.

Facebook (FB) reports results today. We have held an investment position in FB for well over a year. My price target for the end of 2016 does not indicate that the stock has sufficient enough upside to warrant holding an oversized position. Hence we took off about 1/3 of our FB positions ahead of earnings. If it beats estimates and rises after earnings, so be it, we can always raise price targets and look forward to the stock moving higher. If it gets dumped after earnings, then we took some profits at a good price. I see it as a win-win decision.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AMZN & FB — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, October 23, 2015: Chipotle Spoils the Party But Alphabet and Amazon Come to the Rescue

Over the last two days we have endured the most intensive part of earnings season. Along the way we have had to suffer the disappointment of Chipotle Mexican Grill’s (CMG) results and then enjoy the euphoria of McDonald’s (MCD), Amazon (AMZN) and Alphabet (GOOGL) (the company formerly known as Google), strong earnings reports.

Let’s start with CMG, one of the growth stars in the restaurant industry. On Tuesday, CMG missed earnings estimates by 4 cents and revenue expectations by $20 million, though both metrics rose year-over-year. Same store sales decelerated to low single digit rates. The stock was taken to the woodshed, falling 5.7% on Wednesday and another 2.3% on Thursday. We do not own CMG, but I remain steadfast in my belief that the stock is range bound from the low $600s to the low $700s and would trade accordingly. I would be inclined to buy the stock should it dip below $640.

However, CMG sent a tsunami through the entire restaurant industry taking stocks down across the board, very heavily on Wednesday and then less so on Thursday. The two day damage was extensive with other portfolio holdings feeling collateral damage such as Buffalo Wild Wings (BWLD) (-5.6%), Zoes Kitchen (ZOES) (-4.5%), Bloomin’ Brands (BLMN) (-8.2%) and many others down in the 1 – 2% range. This was all while the S&P 500 (SPX) rose 1.07% over those two days.

Mind you that none of those other companies I mentioned reported results and their declines were in sympathy with the CMG disappointment. I strongly believe it was an overreaction on the part of hedge funds and momentum traders. Yet, the damage was done. BWLD which reports next week could post a better than expected quarter and reverse the CMG induced sell-off.

The only exception to the above was McDonald’s (MCD), the big surprise yesterday in the restaurant sector. MCD surged 8.1% as the Golden Arches reported EPS of $1.40 versus estimates of $1.28 and revenues of $6.62 billion versus estimates of $6.41 billion. This comes as the US Dollar and the overseas economies remain a headwind for the company. Despite that, improvements were noted in the US and China. MCD remains a company in transition with its new management team. We do own MCD in our Dividend Strategy.

To add insult to injury on a day when the SPX rose 1.66%; healthcare, pharmaceutical and biotech stocks continued to get hammered, only adding to my under performance and frustration of the past few weeks. Stocks like Mylan (MYL), which stupidly spurned a takeover offer from Teva Pharmaceuticals (TEVA) now trades at a single digit price to earnings ratio, its lowest in many years, and a sub 1.0 PEG ratio. Its stock price has nearly been cut in half after rejecting its suitor.

Then Thursday, after the market closed, the clouds seemed to part and sunshine came down from the sky. GOOGL, our second largest holding and AMZN, our sixth largest holding in our Growth Portfolio both reported results far exceeding expectations. GOOGL put a cherry on top by announcing a $5.1 billion buyback, its first ever in the company’s eleven year history as a public entity. What is helping both companies is The Cloud – cloud computing services. You see, Alphabet is more than just search and ads while Amazon is more than just retail services. GOOGL swelled 9% and AMZN surged 10% after hours. I expect most of those gains to hold on Friday. Perhaps this will put an end to my frustrations.

My personal schedule has me going to Toronto for the weekend as Soft Idea, our 2 year old filly pacer is entered in the Breeders Crown at Woodbine Saturday evening. She runs as horse #6 in the second race. You can watch and root along with owners Dan, Harvey, Andy, Jeff and me online

Then on Monday, late in the afternoon, I am having some minor hand surgery. I will be able to work nearly the entire trading session and will be back in front of the screens on Tuesday, the day when Apple (AAPL) reports results. However, I am going to have to refrain from publishing My Gut Feeling for the remainder of the week.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL. AMZN, BWLD, BLMN, GOOGL, MYL, MCD & ZOES — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, October 21, 2015: Back to the Future Day

Today is the exact day that Marty McFly and Doc Brown traveled forward in time to in Back to the Future. What is interesting, as with the original Star trek series, is how future technology was, to some extent, predicted by the creative teams who wrote and created those movies and television series. Unfortunately, the prediction of the Chicago Cubs winning the World Series will likely not come true. However, miracles do happen.

It just goes to show you how important technology is to our lives. Of equal importance is the role that technology has played in our economy and financial markets. It is for those reasons that growth oriented investors, such as myself, seek out innovation and technology when identifying investment opportunities. Of course, innovation is not a straight line. It has fits and starts. This year it seems to be throwing a fit.

Yesterday biotech shares went back to being unloved while on the other hand, Apple (AAPL), which reports results next week, caught a nice bid. This is consistent with the market’s inability to gain traction this year on a uniform basis.

Tesla (TSLA) shares declined 6.61% after poor Consumer Reports reviews. Is there any car that reminds you more of Back to the Future’s DeLorean than a Tesla, from a technological point of view? TSLA shares are too expensive and volatile to own but I do like its convertible bonds which we own and might add to.

Speaking of automobiles, Ferrari (RACE) priced its IPO at $52 after the market closed. I put in for some stock for clients via UBS who ran the deal. Hopefully we can get some allocation.

Yum Brands (YUM) announced that it was going to split into two companies: a China based company and one for ROW (rest of the world). This is a case of financial engineering and management kowtowing to activist investors. The company’s announcement is no reason to want to buy the stock as it still has operational issues in every geography, including the USA.

After hours shares of Chipotle Mexican Grill (CMG) got hit rather hard (nearly 8%) after reporting disappointing results. The company’s same store sales were rather meager at 2.6% compared to the double digit comps that we were accustomed to see CMG generate. Earnings per share of $4.59 rose 10.6% year-over-year but missed estimates by 4 cents. We have been waiting for CMG shares to fall with an eye of repurchasing them in the lower 600s and could get a chance in the next day or two.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, October 19, 2015: Earnings Are in the Driver’s Seat

After watching Soft Idea qualify on Friday for the Breeders Crown in Toronto next weekend (more on that later in the week), enjoying a Jimmy Buffett concert on Saturday evening and then a Don Rickles show on Sunday evening, it will be hard to get enthusiastic about the week ahead. Yet, with a busy earnings week about to unfold, I will find some ways to do so.

For those of you setting your calendars, Thursday is the most interesting day for earnings with Alphabet (GOOGL) a/k/a Google; Amazon (AMZN) and McDonald’s (MCD) all set to report that day. That will make Friday’s options expiration an interesting event.

For the most part, the worrisome issues of China, the FOMC and US payrolls are in the rear view mirror or in economic remission. That leaves earnings in the driver’s seat. So far, reactions to earnings have been muted in the micro sense but in the macro sense, the equity markets have a nice bid to them.

Frankly, I was surprised at the strength of the equity markets on Friday afternoon. There was no way that I would have expected those markets to close on the high as we headed into the weekend. Not only did the markets do so, but the S&P 500 (SPX) closed at its highest level since August 20. I would also note that some of those laggard sectors; biotech and retail, to name a few, appear to have bottomed and are ticking higher. Still though, they have plenty of catching up to do.

As for today, we could get a continuation of Friday’s session as China’s reported GDP exceeded economists’ expectations and Deutsche Bank launched a corporate restructuring program. After the market closes I am flying back east for a few weeks and will return with more commentary later in the week.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AMZN, GOOGL & MCD — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, October 15, 2015: Wal-Mart’s Problems Are Wal-Mart’s Problems

That thud you might have heard yesterday was that of Wal-Mart’s (WMT) stock taking a 10% plunge. Company management guided to 12% lower results in its next fiscal year. Concurrently, retail sales rose 0.1% last month versus estimates of a rise of 0.2%. Wal-Mart’s announcement not only took that stock lower but weighed on the rest of the retail and consumer discretionary stocks. Unfortunately as we are overweight in these sectors, we had a bad day in both our growth and restaurant portfolios.

However, upon further review, to borrow a phrase from the NFL, Wal-Mart’s problems are Wal-Mart’s, not the rest of the retail and discretionary consumer sector. Here are four reasons why I believe that the Wal-Mart announcement is isolated to that company or not a broader economic issue:

WMT has begun to raise it minimum pay for employees. Given WMT’s size and existing payroll structure, the impact to the company’s bottom line will be significant, far more than its competitors.
Part of WMT reason for cutting its projection was due to the strong dollar, which should come as no surprise to the market, given WMT size and global reach.
Increasingly WMT is losing sales to competitors such as Costco (COST) and Amazon (AMZN). As it turns out, yesterday, AMZN was only off about ¾%, significantly less than the overall retail sector.
WMT has a history of squeezing its suppliers. Chinese companies are huge suppliers to WMT. Given what is going on in China, I would not be surprised if vendors would not be pushing back and perhaps, demanding higher prices for goods. Face it, WMT is vulnerable to any production issues in China, even more so then are the Chinese producers, given how tightly WMT has squeezed them over time.

Perhaps the reaction to WMT stock was justified. However, the spillover to the rest of retail and discretionary stocks was not justified. This leaves many retail and consumer discretionary stocks at bargain level prices. Today will be a big test for those sectors and I expect them to rally off of yesterday’s sell-off in sympathy with WMT’s woes.

Netflix (NFLX) reported results which slightly missed analysts’ estimates. The company pointed to credit card transition to chip technology for the earnings miss. What seems to be occurring, is then when new chip embedded cards are being issued, subscribers are not updating their credit card information with NFLX on a timely basis and hence their service is not being continued. I know this firsthand as several of my recurring credit card payments to vendors were skipped when my card was replaced. It usually takes a cycle to rectify the situation. Initially NFLX shares dropped over 10% after hours but regained most of that lost ground and was off only 3% when the after-hours trading session ended. There is a good chance that the stock could turn positive in today’s session.

Today, Citigroup (C ), Goldman Sachs (GS), Key Bank (KEY) and US Bancorp (USB) wind down the banking segment of earnings reports. Also of interest are Schlumberger (SLB) and Wynn Resorts (WYNN). While it is too early to tell how 3rd quarter earnings are playing out, the fact remains that expectations remain low.

Tomorrow I am speaking at the Money Show Trader’s Expo at the Paris Casino and Resort in Las Vegas. The topic is Options Volatility. If you are in town, I hope to see you there.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AMZN & NFLX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, October 13, 2015: Four Significant Companies Set to Report Results

Columbus Day trading sessions are nonsensical as the stock markets are open and the bond markets have the day off. Either the bond markets need to open on Columbus Day or the stock market needs to take a holiday. Until then, we will get lethargic trading, as was the case yesterday. I have to say, it as a perfect set up for the bears to wreak havoc on a low volume day but either they took off, or the bulls had more firepower. It was likely the latter as stocks posted modest gains.

We managed to do a small trade, adding to our existing positions in Molina Healthcare (MOH). Otherwise, the day was spent catching up on client related paperwork.

There was a big announcement in technology mergers and acquisitions; in fact the largest ever deal in technology. Dell Computer, a private company will acquire EMC (EMC). The big question is whether this stirs up the pot for the zeal to deal.

Earnings season gets interesting today as Johnson & Johnson (JNJ) reports results before the markets opens and the troika of JP Morgan Chase (JPM), Intel (INTC) and CSX (CSX) all report after the market closes. Each company is a leader in their industry and will be a good table setter for earnings season. Interestingly enough, JPM shifted its earnings release and conference call to after the market closes. I can make a case for all of these companies to disappoint investors and I am certain that some will, although the bar was set low for each and every of those disparate companies.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MOH — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

___________________________________________________________________

My Gut Feeling For Today, October 8, 2015: Market Rallies Since Fed Disappointment

Many of my readers have asked me about my absence in the past several days. As it turns out several events prohibited me from publishing My Gut Feeling since September 30. To begin with, on October 1, we switched the servers which point to the LakeView Asset Management website and access to the site was down the end of last week. Then Saturday, very early in the morning, I rushed my daughter (the nurse) to the hospital. After many hours in the ER, she was diagnosed with appendicitis and was taken to surgery in the afternoon. She is back home and recuperating, but needless to say, I was otherwise preoccupied and the time I usually devote to publish were spent looking after her. I know there are many Rabbis who read My Gut Feeling, so I will let you know that her name is Miriam bas Shmuel v’Elka Shoshana. This also explains my absence from Simchat Torah.

So let’s get back to the markets. After the FOMC “disappointed” the financial community, equity markets went on a nice run to the upside, its best such move in many months. The S&P 500 (SPX) has advanced 6% since the Fed sell-off in late September, although the index is still off about 3.1% for 2015. Too bad the markets sold off at the end of September and waited till October to rally.

Energy seems to have awakened from its year-long break-down. A few weeks ago we began to nibble in energy with the Select Sector SPDR Trust ETF (XLE) and then added to that last week with purchases of Energy transfer Partners (ETP). Unfortunately, the biotech and healthcare sector have been a continuing source of performance anxiety for many managers, myself included. However, they have appeared to bottom but before adding to positions, we have to make sure that the bottom is real.

Earnings season has begun with companies such as Pepsico (PEP) and Yum Brands (YUM) reporting results. Going into earning, we owned PEP for our dividend portfolios. YUM dropped precipitously yesterday. We used the decline to buy some stock for our Buy-Write Strategy. Earnings reports will pick up stream next week. There is one thing that is evident in the PEP and YUM reports that will be endemic across all of corporate America’s earnings: the negative impact of the strong US Dollar. That is something we cannot avoid and should not allow to cause investor consternation as it was well telegraphed.

What was encouraging about Wednesday’s session was the double reverse – stocks opened higher, were sold off into the red and then rallied back for solid gains by the closing bell. I still think we can have a strong 4th quarter but remain cautious, that for 2015, we are destined for a lackluster 2011-like year.

One administrative item. Scottrade has alerted clients that there was a cyber security breach across client accounts at many brokerage firms. While this is a cause for concern, as is the case in general in our cyber world, client information and assets are safe. This of course, explains why we hold stocks such as Fireye (FEYE) and PureFunds ISE Cyber Security ETF (HACK).

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long ETP FEYE, HACK, PEP, XLE & YUM — although positions can change at any time.

– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC

– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, September 30, 2015: Hillary Does Damage and Proves Her Ignorance

We have gotten past the Jewish High Holidays (though Sukkot runs over the weekend) and some of my business travels to/from and in the west (though I return next week). When I last left off the markets were disappointed by the Federal Reserve’s decision to delay their interest rate increase. Still, at the time, the markets, defined by the S&P 500 (SPX), while off by 4.5% for the year and quarter, were holding in well.

Then out of the blue, Hillary Clinton, on Twitter (TWTR), in twenty-one words, on September 21, 2015, single handedly, brought the markets to its knees. Those words:

“Price gouging like this in the specialty drug market is outrageous. Tomorrow I'll lay out a plan to take it on. –H”

That sent the biotech market into a freefall. The biotech market took the rest of the tech heavy NASAQ along with it. Of course, there was collateral damage to the SPX. Since September 18, these indexes performed as such: NASDAQ Biotech (NBI) – 18.73%; NASDAQ 100 (NDX) -5.56%; and, SPX -3.78%. Over that period of time, especially last Friday and this Monday, the markets had some rather horrible sessions. With Biotech and NASDAQ being some of the most growth oriented sectors, the damage done to growth and tech portfolios was rather great.

All of this happens to have sped up the retesting of August’s lows. Now that that has nearly occurred, and once we get through the end of the quarter, I believe we can find a bottom and rebound. Nevertheless, the damage was done, thanks to Hillary.

The damage is far greater than just some biotech and technology stocks. What she did was remove incentive and motivation for doctors, scientists and business people to perform research, discover and then market a cure for diseases and other conditions. It takes hundreds of millions or billions of dollars over many years for drug manufacturers to research, test and then have approved a new medication.

Once that drug comes to market, the pharmaceutical company has to not only recoup its prior research and development expenses for the drug, it has to cover costs for failed drugs in its former pipeline and then try to make a profit while marketing the drug. Then consider that the drug is protected by patent for 20 years. However, that patent clock begins at the time of application, before the clinical trials, which can be many years before approval and marketing takes place.

So now, because Hillary is trying to garner votes by painting the pharmaceutical companies as villains, the unintended consequences of her tweet will be felt for years. Even more if she gets elected. With her tweet, how can someone raise funding now for a pharmaceutical project? How many cures will not be discovered or be pushed out for many years because of her tweet? I am afraid to say many in the short run, and if she is elected, plenty more in the long run.

By the way, her “plan” was for the most part nonsensical and will create a marketplace that will not foster innovation but will chase capital and talent to other endeavors. It proves her ignorance as to how the pharmaceutical and health industries and capital markets operate.

I am not being political (though I don’t support Hillary) but am being pragmatic – both from a financial and social perspective.

So this leaves us with a market that is now damaged, but not necessarily broken. The SPX is off nearly 12% from its all-time high but remains about 1% above its August low. The markets will need time to repair the damage done in the last week and a half. So, many analysts and investors, me included are looking at pushing our 2015 year-end expectations out to 1q16. I think we are going to have to accept what damage has been done and look at 2015, which just as recently as July, was looking to be a positive but average year, as one of those down years in a bull market.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long TWTR and TQQQ — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, September 21, 2015: Federal Reserve Decision Disappoints

Last Thursday the Federal Reserve Open Market Committee decided to hold interest rates where they are. Although, Janet Yellen, in her press conference, did intimate that even when tightening does occur, the FOMC would remain accommodative. I interpret that as a “one and done” approach. While I thought the FOMC should raise rates in September, I understand the reasons why they did not: lack of inflation and an all too strong US Dollar.

The decision was met with its usual swings in the stock market, but all told, the market was disappointed and stocks sold off by the end of the day. Like me, equity investors wanted the FOMC to get it over with, but the monetary mavens did not oblige.

Then on Friday, equity markets took it on the chin, declining well over 1.50% for the S&P 500 (SPX) and Dow Jones Industrials (DJIA). While the FOMC might have provided some motivation for the selling, there were two other factors at work. First, stocks have recently rebounded handsomely off the August panic lows and were a bit too overbought. Second, and the more likely reason, was the impact of quarterly derivative expiration.

Of course, another more anecdotal explanation is compliance with the old “Sell Rosh Hashanah, Buy Yom Kippur” saying.

However, what the FOMC decision did for the bond market was to continue to prop up bond prices. Bonds yields can’t get much lower and prices are stretched to bubble proportion. So, the eventual bond bear market and collapse is just getting pushed on down the line.

The economic calendar is rather light this week, I suspect that we will muddle about until the end of the quarter shenanigans take place next week. Until earnings season, there are no significant events, other than September payrolls to confront the equity market.

___________________________________________________________________

My Gut Feeling For Today, September 16, 2015: Janet Yellen: Does She or Doesn’t She?

Slowly but surely we are refocusing attention away from China and back to matters at home. Yesterday’s positive retail sales report sent stocks higher, after a typical dull and slightly negative session on Monday.

As you know, I set forth my tactical strategy for the equity market several months ago. I expected a pullback in August which was to continue through this week, the week of Rosh Hashanah / FOMC meeting. Heading into August I hedged our portfolios and then slowly unwound those hedges in late August, putting cash back into the market. I now believe that with the correction in the rear view mirror and very active debt issuances the past two weeks; that the equity market is poised to make a run higher into the end of the year.

First of course we need to get past Thursday’s FOMC announcement. The big question on everyone mind is: Will She or Won’t She? This of course refers to whether or not Janet Yellen’s FOMC will pull the trigger and raise interest rates. I am reminded of the old Clairol commercial Does She or Doesn’t She. As for an increase in rates, only the FOMC knows for sure.

We do all know that the FOMC will increase rates from its current range of 0 – ¼% to a hard rate. The question is: when? I expect that the FOMC will go to a firm ¼%. I also expect that they will stop the cat and mouse game with the financial markets and get it over once and for all on Thursday. Other market experts believe that they will postpone that decision till its October or December meeting. I am also of the opinion that the FOMC will send a strong message that this is a “one and done” rate rise and no more would be forthcoming till the second half of 2016, unless warranted by future economic data.

Until then we will have to endure a day and a half of trader positioning and Fed watcher pontification. Today, given that the market will be sluggish ahead of Thursday's announcement; it will be a great day for a drive in the dessert, which is exactly what I will be doing in the afternoon from Henderson, NV to Santa Monica, CA, where I will be speaking at the IMN Crowdfunding for Real Estate Conference on Thursday.

___________________________________________________________________

My Gut Feeling For Today, September 9, 2015: Apple Announcement: Good For Apple But Not Bad for Netflix

Over the weekend several global finance ministers met and talked to the press. The most prominent commentary came from the Chinese representative who stated, and here I am summarizing, that the Chinese market is set for a bottom.

Interestingly enough, we did not get a bounce in China at the get-go, after nearly a week-long market closure in that country. Rather, the market opened lower and then bottomed, closing with a healthy rally. That action is important because bottoms typically come after an opening decline which then get reversed. Up till Tuesday, any early market bounce in China was sold later in the session. Tuesday was different. So, the question becomes, was that Tuesday reversal a sign of a bounce or a bottom? I believe a bottom, given the strong global follow through and the positive continuation overnight in Asian markets and US futures.

That all being said, one Chinese stock opened higher in the US but then reversed lower. That stock was Alibaba (BABA). Recently BABA has become a battleground stock. That is a stock which seems to be in a tug of war between bulls and bears but always seems to be defeated. After opening higher, a Citibank (C ) analyst came out with negative commentary on BABA and sent the stock lower in a strong market, despite other Chinese internet stocks rising in the US. So, I made a decision to sell our stock, to book some tax losses. In 31 days we will take another look at repurchasing BABA . I still feel strongly about its business model but don’t want to get caught up in the battleground crossfire.

Today, there are two events the media will be focused on. The first, is Queen Elizabeth’s having now succeeded her ancestor, Queen Victoria as the longest reigning monarch in the United Kingdom. I feel sorry for Prince Charles. The second media event, of greater importance to the financial world is Apple’s (AAPL) iPhone announcement.

AAPL is expected to reveal an upgrade to its iPhone 6 model, likely the iPhone 6S. It is highly speculated that AAPL will also reveal a revamped Apple TV, along with its own content and streaming service. This has worried Netflix (NFLX) investors who fear the AAPL will destroy NFLX’s business.

I for one, do not believe that AAPL will destroy NFLX. NFLX has deep penetration and is now entering Japan. Recall that AAPL’s music service was also feared to take away competitors’ business but has so far been a disappointment. In my opinion, you need to own both stocks and NFLX, after a nearly 30% decline from its peak, can be bought or added to now.

From a macro perspective, now that we are past the vacation month of August and Labor Day, all the major market players are back at their desks. This could have spurred bargain hunting in Tuesday's session, which I expect could be the beginning of a more substantial move higher.

On a personal note, I have a very hectic schedule the next two weeks. Thursday I am returning west to Nevada. Then I will celebrate the Jewish New Year, after which I will appear at the IMN Crowdfunding Forum in Santa Monica. Then it is back to Nevada for Yom Kippur. So, my commentary will be published a bit more sporadically than usual these next two weeks.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL and NFLX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, September 2, 2015: Playing the Retest Game

The markets began the month of September by taking its cue from August. It started out rather suspiciously with pre-market futures gapping lower on no real news. Given that pre-market futures trade very thinly, it looked like some market manipulation was going on. Regulators are catching up to these thieves but there is always a wise guy who still beats the system. The futures selling then spread into the regular market session and what ensued was another nasty sell-off.

The problem is that there was no real news to speak of to cause the sell-off. China had another roller coaster session, but we have come to expect that. OPEC made some comments as did Fed Vice Chairman Stanley Fischer. So, we got spooked on some opinions but no new economic developments. This “will they or wont they” game that the markets are playing with the Fed is getting a bit ridiculous. We know that the Fed will raise short term rates from a range of 0% to 1/4% to a full ¼%. Yet, we seem obsessed as to whether it happens in September, October or December. It will happen once and that’s it for a while, at least not till later in 2016.

In other words, the markets just want to play the retest game. That is when a rally following a correction retests the correction lows before heading higher again. It is designed to shake out weak holders. There are several quantitative reports which point out that from a historical perspective, after similar recent turbulence, that the markets will be higher in the near future. Emotions not rationality are in control. So just buckle your seat belt.

One of yesterday’s few silver linings was one of our long term holdings, Buffalo Wild Wings (BWLD) which scored a gain and has for the most part bucked recent market weakness.

Overseas markets in the Far East were mixed. Chinese markets gapped lower at the open and then rallied to close fractionally lower. Europe is showing some fractional gains in our pre-market. The US markets are getting a slight bid. I do not expect a quiet session like last Friday but I also do not expect a replay of yesterday. I do expect that volatility which is at extended levels will contract.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BWLD — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, September 1, 2015: Goodbye and Good Riddance to August

The markets closed out August with yet another losing session. There was a midday attempt to rally stocks but what looked like, at least to me, overseas selling in the more liquid US markets, repelled any rally attempt. So we clock out August with a decline of 6.26% for the S&P 500 (SPX). It is the worst monthly decline since the 6.27% decline in May 2012. The decline for August 2015 was the fourth decline in the last six Augusts.

So as we enter September; the cruelest month for stocks, in any years, and even worse in a Pre-election year; the SPX is off 4.21%. I know it feels worse than that because of the drubbing in August that we just took.

Just because we are down for the year, it does not mean that we are in a bear market. Recall that in the midst of the great 1982 – 2000 bull market, the SPX declined 6.56% in 1990 and 1.54% in 1994. The 1950s-1960s bull market had four down years interspersed within it. Since the market bottomed in 2009, 2011 had a modest decline of 0.04 index points, which is hardly a decline, but it was not an advance. So, as you can see, one off year is not a bear market make. In fact, it is a healthy period of digestion and consolidation before the markets resume their upward move.

My good friend and client Alex, a devout Christian, and I have been talking about Jewish numerology and the concept of the Shemittah. It is essentially the concept of a Sabbatical year, a year of rest. Some Evangelicals might argue that as the current Shemittah year is about to end, a catastrophic event will occur in the stock market. I don’t buy that forecast, nor do other observant Jews. I do admit it makes for interesting conversation.

However, I do buy the fact that markets, just like people, animals and land need a rest. The stock market can get exhausted after a while. So, just like in 1953, 1957, 1960, 1962, 1990 and 1994, we may have a year where the market just needs a rest in the midst of a bull market.

Bull markets, however, do not die of old age. They die of recession. We are not about to enter a recession. The Federal Reserve does not increase interest rates at the beginning of a recession. They increase interest rates during an economic expansion and begin to cut rates during a recession. The FOMC is about to start a tightening cycle. Bull markets top out at peak valuations. By many measures we are far from peak valuations. Finally, recessions begin with widespread gluts. With the exception of crude oil, there is no evidence of systemic gluts.

Overnight, continued weakness in the Chinese markets once again dragged US stock index futures lower. Periods of volatility and instability take a while to heal and we have to be patient while that healing takes place.

___________________________________________________________________

My Gut Feeling For Today, August 28, 2015: Oil Surges and Bonds Fall Amongst the Insanity

It has been an exhaustive week, so much so that I needed a good night’s sleep and postponed sending out My Gut Feeling till the morning.

The markets’ insanity continued unabated so far this week. Monday and Tuesday were retail days of panic for stocks. Wednesday and Thursday were dominated by institutional buying of stocks. However, two other newsworthy developments occurred amongst the tumult. First was that bond rates backed up (went higher) and bond prices declined. This occurred despite indications that the Federal Reserve would further postpone a hike in interest rates. Second, crude oil prices surged on Thursday, potentially marking the end of the decline in that commodity. Both of these developments are constructively positive for the stock market.

It is estimated that for the week ended Wednesday, $17 billion was removed from US mutual funds. That cash wound up for the most part in money market funds. This is proof positive that retail investors were at work panicking before the rally kicked in. Sell low and buy high is typical of the retail investor, who, as I pointed out on Wednesday, invest in inefficient mutual funds.

Markets are coming off of the biggest two-day rally in the stock market that I could ever recall. We continued to incrementally unwind our hedges and put the proceeds to work. By the end of Thursday’s session, all of our portfolios were back to normal exposure levels.

Eyes and ears will be on the global economic meeting at Jackson Hole, Wyoming this weekend. Expect plenty of sound bites from economists and central bank officials but nothing other than theory and hyperbole.

For the record, from peak to trough, the S&P 500 (SPX) declined 12.69%. As of yesterday’s close, the index was off 7.05% from its all-time high. Versus last Friday’s close of 1,970.89, the index is higher by 0.85%.

Early index futures indicate slight declines at the open. What the markets need today is a quiet session. I am not sure it will be all that quiet but I am of the opinion that it won’t have swings of the magnitude that occurred over the past week.

________________________________________________________________________________________

My Gut Feeling For Today, August 26, 2015: Individual Investors Have Themselves to Blame

China followed through Monday’s ugly trading session in the USA with another major decline. Then after that market closed, the Chinese government cut a key lending rate. That action in turn sent US index futures even higher than they were midnight last night. The US stock market opened on a high note with the S&P 500 (SPX) holding onto gains of 2 – 3% for most of the session. That was until the last hour of trading when the stock market gave up the ghost. When the bell finally rang, the SPX posted a decline of 1.35%, extending its losing streak to six straight sessions with a cumulative loss of 11.17%.

So, you wonder, why did a strong session crack in the end? I hate to say this, but individual retail investors have themselves to blame. After Monday’s debacle, the retail investors, who for the most part use mutual funds to invest in the market, entered massive liquidation orders for their mutual funds. What they don’t realize is that unlike a stock order which will get executed (most of the time) immediately, mutual fund orders are aggregated throughout the trading day. Then in order to fill the liquidation orders, the mutual fund advisor will sell enough stock in the funds to meet the liquidations. That stock selling takes place, for the most part, at the end of the trading session, at closing market prices.

As if that is not bad enough, the stock exchanges will publically disseminate trading imbalances. These mutual fund sell order imbalances were so large that hedge funds and other professional money managers front ran the market close by selling futures and buying put options right up to the closing bell. It was like shooting fish in a barrel with the fish being the mutual fund investor.

The concept of mutual funds worked pretty well from the 1950s to 1970s. After then they just became vehicles of market underperformance. Just check their track records and read this recent article from Morningstar, a leading mutual fund publication. Many funds are so large that they are effectively overpriced index funds. However, individuals and their employers flock to them for their ease of use and low barrier of entry without regard to cost or performance.

The stock market is a zero sum game around the mean market return. If mutual funds are consistent underperformers, then who are the outperformers? Everyone else: managed accounts, hedge funds, private equity funds, pension funds, corporate issuers and other professional investors/managers. The latter group of professional investors live off of the flesh of mutual fund investors. Yet, the small investor continues to get hoodwinked by slick mutual fund marketing.

Don’t get me wrong, there are some excellent mutual funds and underperforming professional investors plus your occasional scam artists like Bernie Madoff. However, for the most part, mutual fund investors are just a bunch of suckers.

Another more recent development in the mutual fund arena are “financial advisors” who charge fees to allocate client moneys across a series of mutual funds, promising diversification and optimal returns. The investor gets hit twice for fees – once by the mutual fund managers and then again by the financial advisor. It is just another way of scamming the individual investor.

Enough about what I like to call the Mutual Fund Myth and back to the markets.

What we really need is a down open that gets bought rather than a higher open that gets sold as was the case in Tuesday’s session. That way we can shake out more panicked investors early, let strong investors snap up stocks and get through the last round of margin selling. Remember, retail investors like to buy high and will sell low whereas professionals buy low and sell high.

Tuesday’s session was picture perfect for us. Despite the late day selloff, our Growth Portfolio posted gains and outperformed the SPX by nearly 1.7%. Our more risky Restaurant & Food Strategy posted a small loss but still outperformed the SPX by about 0.6%. How did your mutual fund do?

We remain hedged with about 78% market exposure after taking a position in Magna International (MGA) yesterday, which goes ex-dividend today. My next purchase, once we sell off more of our hedge will be a beaten down retail stock.

Finally, congratulations to two of my peers, good guys and excellent market pros, Brian Reynolds and Dr. John Rutledge on their value added appearances on CNBC yesterday.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MGA — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, August 25, 2015: Sheer Insanity

I have been in this business for over thirty years and just when you thought you saw it all, along came August 24, 2015. The stock market open was the most stupid, sloppy, silly panic of a market open there has ever been, at least in my days as a professional. I can’t speak for Black Tuesday 1929 or Monday September 26, 1955 after President Eisenhower’s heart attack, but you get the point. Yesterday made Ebola the 15th (October 15, 2014) market open seem orderly. I have to say that it was the most exhaustive day I ever experienced in the business since the 1987 Crash.

The Dow Jones Industrials (DJIA) opened lower by nearly 1,100 index points. The S&P 500 (SPX) did so by 104 index points. In percentage terms the opening decline was 6.58% for the DJIA and 5.27% for the SPX. The NASDAQ Composite was even worse, down 8.8%. Retail and overseas panic plus relentless reckless computerized executions were to blame for the sloppy market open. It was sheer insanity and surreal to watch. I was interviewed for the NJTV evening news on the market’s lunacy.

Individual stock declines at the market open were even more outrageous: Verizon (VZ), -17.44%; Apple (AAPL), -13.01%; Netflix (NFLX), -17.76% and CVS Health (CVS) -20.39%. Those stock were changed on the day as follows: VZ -2.95%; AAPL -2.5%; NFLX -6.81%; and, CVS -1.96%.

You also knew those opening declines were not going to last. Indeed they did not and we got a nice rally until the afternoon when margin selling kicked in and the retreat continued. However, in the last hour that selling abated and by the closing bell all of the major index sank by between 3 ½% and 4%. I am convinced that it was a day of capitulation.

The SPX is now down by 11.45% from its all-time high, formally putting the index in correction territory. That is good and bad. Bad because the index is off by 11.45% from its high. Good because we finally got the correction out of the way after having to hear from the bears how long we have gone without one.

Our hedges helped to helped to take some of the sting out of the sharp declines of the last few sessions, but of course, losses were totally not avoidable. We came into Monday’s session about 72% net long in our Growth Strategy. After unwinding some hedges and starting a position in CVS we ended the session at about 76% net long. I will continue to incrementally unwind hedges and reinvest the proceeds into stock – new or existing positions – as this correction continues to play out.

Midnight futures indicate a rebound is in the cards for this morning. However, anything can happen in China overnight to sour a rebound. Furthermore, where we open today will not be predictive of where we close given the elevated level of absolute and intraday volatility.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, CVS, NFLX & VZ — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, August 24, 2015: Not Time For Panic

It got real ugly real quickly on Thursday and Friday. The S&P 500 (SPX) declined 2.11% on Thursday and then 3.19% on Friday. Of course the Dow Jones Industrials (DJIA) grabbed the headlines having declined over 500 index points on Friday. In the process, 2015 market gains were erased and turned to red for the major market averages.

There is no doubt that over the weekend, nerves were frayed and a sense of discouragement gripped individual investors’ psyche.

As an investment professional, I look at what has occurred in a somewhat more clinical, analytical and unemotional basis. So let’s understand what is going on in the financial markets and how to react.

It all began as China commenced a series of currency devaluations. While those were small devaluations, nevertheless it sent a message to the global markets that China needed to stimulate its mercantilist export machine which seems to have slowed down. Understand that the Chinese economy is growing at a pace that any mature economy such as the USA, UK or Japan would love to have. However, given that China has accounted for so much of global growth and material consumption, the slowdown in China has alarmed some investors.

The Chinese devaluation only helped to boost an already strong US Dollar. That then resulted in oil prices falling to multi-year lows. Kazakhstan, an oil rich nation and home to Borat decided to no longer support its currency, the Tenge, which then collapsed. Other nations dependent on oil exports, especially in Latin America watched as their currencies and debt declined.

A strong US Dollar also equates to lower revenues and earnings for US companies doing business abroad. Naturally, investors feared that earnings estimates would be revised lower.

To add insult to injury, Friday was options expiration in the US. That event only served to exacerbate the selling. Add to that the impact of overleveraged hedge funds getting margin calls, retail anxiety, high frequency trading and widespread use of exchange traded instruments and a full-fledged panic ensued on Friday.

When the dust cleared on Friday, many gauges indicated that the markets were severely oversold. However, we professionals know that it can get more oversold. One reason is that over the weekend, individual, that is retail investors, obsessed over the recent market decline. They, as is always the case after such sell-offs, will be on the phone or online before the market opens today, placing orders to sell as panicky and did the Duke Brothers at the end of Trading Places. The other reason is that the markets and market participants, in the short run are not rational. However, you see, the professional investors know the Pavlovian response by individuals and will be waiting for a selling climax into which they can buy stocks on the cheap, just as Billy Ray and Louis did in Trading Places.

That opportunity could come this morning, as it appears that based on overnight futures indications, selling pressure on stocks will be heavy at the open. In many respects, we are looking at what occurred leading up to and on the morning of October 15, 2014 when apparently we were all about to die from Ebola. That morning, the SPX opened down 3%, a 9.5% decline from its previous high, only to reverse. At the end of that day, the SPX closed down less than 1% and then within a month, when we did not all perish from Ebola, rose to a new all-time high.

As we now stand, entering today, the SPX is off 7.6% from its all-time high. The magic 10% decline signifying a correction will likely be met this morning. Guess what? That’s OK. It happens naturally as part of a bull market progression. Unfortunately, we have been spoiled by the fact that it has not occurred since 2012. In 2012 it took 25 trading sessions to occur. For the record, the SPX last peaked on May 21, 2015.

In bull markets, stocks rise gradually yet correct suddenly and sharply. In bear markets, you a slow and steady decline like death from 1,000 cuts and counter cyclical rallies are short lived and sharp.

So while you should be concerned about your investments, you should not act out of fear or panic. The major reason for bull markets to turn to bear markets can be summarized in one word: recession. There is no indication that the US is in or headed into a recession.

Here is what I did and what I plan on doing. As I have been writing in My Gut Feeling for several weeks, I expected a market pullback from the beginning of August to the middle of September. With that in mind we hedged off our Growth portfolio, such that our exposure to the SPX was about 72%. On Friday, we scaled out of some of the hedges, but still ended the day with the same exposure of 72%, as our hedges grew as the market declined. Should we have a market open like the 15th of Ebola, I will take off more of the hedges. For every 1% further decline in the SPX, I will take off even more. By the time I see full capitulation I will be out of all hedges and put our cash to work in order to get back to fully invested levels.

Please understand that some more pain might be in the cards in the near term. However, longer term expectations for a higher market remain unchanged.

Many of you called over the past few days to discuss the markets. Please don’t hesitate to call me if you are feeling any anxiety about the market.

_________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC had no positions in stocks mentioned — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, August 19, 2015: Jello Market

The summer doldrums continue to impede the equity markets from making any progress. It is what I describe as a Jello market – you push in on one side and the other side juggles outward. There is no correlation between economics and stock direction. Sectors within the market and stocks within sectors are all acting independently. If it were anytime other than August, perhaps this would raise eyebrows. However, it is August and as expected the market is acting soggy while people are at the beach, on boats, playing golf or at the racetracks.

Many stocks are moving, mostly lower on thin volume and insignificant or no news. Good news is being cast aside. Economic data point releases continue to indicate that the economy is moving in the right direction. Yesterday’s case in point was the growth in housing. In a more active market, good news would move stocks accordingly. However, when the B-Teamers are in charge, as is the case now, all that happens is that sell buttons get pushed. This action will allow us to unwind our hedges and buy or add to great growth stocks after this Jello market ends and before the autumnal equinox occurs. There are indications that corporate issuers are getting ready for that period of time as well by issuing debt now to fuel future buybacks.

I spent the last four days, as have many other parents, taking their child for freshman move-in at some university across the nation. This is another reason for investor summertime apathy. We drove back and forth to Purdue University in West Lafayette, IN for our freshman’s move-in (for the fifth and last time as parents). While I was able to focus on the markets via wireless technology, I got in some great anecdotal research, as I always do, along the highways, at retail establishments and of course at restaurants. No matter where I travel, there are always lines at Chipotle Mexican Grill (CMG). That was the case for one in Lafayette that we ate at and one in West Lafayette that we passed by. For the record, we sold out CMG earlier in the month on a price basis and would be a buyer again in the $600s.

As for today, and likely the rest of the week and month, expect more wiggling and jiggling. Don’t take this as a reason to be an active buyer or seller. Strategically position yourself for when investors start to make decisions based on earnings and economics; rather than on club number, post position or SPF strength of lotion.

__________________________________________________________________

My Gut Feeling For Today, August 13, 2015: Chinese Water Torture Continues

For the second consecutive day, China devalued its currency. Alibaba (BABA) the Chinese retail monolith reported results. Despite exceeding analysts estimates by 1 cent and announcing a $4 billion share buyback, investors were disappointed by the company’s revenue growth rate. As a result, traders sold the stock off rather hard. You have to understand that it is difficult to accelerate revenue growth when you are already doing so at a 30% pace. Still, with all the economic headwinds in China, BABA will grow earnings at a 25% plus rate for 2015 and 16. There are not many companies out there selling for 1 times PEG (Price to earnings adjusted for growth) with a high growth rate. So, you have to be patient with BABA and I would go so far as to say you can go against the crowd and add stock. I still maintain my $120 price target for BABA.

Markets Open Lower, Then Turn Around

As a result of all that, coupled with technical damage to the S&P 500 (SPX) the markets opened on a sour note. It was a rather ugly morning for stocks. Then, suddenly without warning, equity markets in the US turned around in the afternoon. By the time the closing bells rang, the SPX and NASDAQ 100 (NDX) posted small gains. However, you could not feel those gains because Chinese stocks and any company doing business in China all got hit hard, except Apple (AAPL), which bounced a little. The buying took place elsewhere.

So what were the big pension funds, who really dictate the direction of the market doing? Selling winners to buy losers. That’s right, they were selling growth to buy the beaten down energy and utility stocks. It was bargain hunting at its finest. Those two sectors bounced just under two percent yesterday. Even so, after the bounce, energy stocks are down about 10 – 12% and utility stocks are off 5 – 6% on average so far this year. We have been looking for opportunities to get back into energy and this might be the first signal.

The other big buyers out there were corporations who stepped up to buy their own stocks which have been pummeled 5 – 10% just in August alone. Also helping to propel stocks in the afternoon, especially in the energy patch, was a decline in the US Dollar (USD), which appears to have fallen for the first time since my Bar Mitzvah. The decline in the US Dollar might be a signal that the conditions in China might put the FOMC back on hold.

Dislocations Will Continue

Overnight China seems to have firmed and is setting up for a bounce. The craziness of August is still here. The dislocation between growth/China and energy/utilities might still play out in the short term. In the long term, growth is alive and well and China will not falter. My strategy remains the same. Keep our hedges on and wait for opportunities to move back into some beaten down growth names, just as we did with Twitter (TWTR) the other day.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, BABA, TWTR & QID — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, August 12, 2015: Anything Goes in August

Did I mention that it was August? I believe so. It is the month of beaches, boating, golf, Saratoga and the unexpected. In August we have seen: the Invasion of Kuwait (1990), the Russian Coup D’etat (1991), Russian Financial Crisis (1997) and US Government debt downgrade (2011), as examples of the unexpected. These exogenous events have come out of nowhere to wreak havoc on the financial markets. This August, specifically yesterday, China delivered the body blow when it devalued its currency, sending the US dollar yet higher and stocks lower.

It was a complete reversal of Monday’s rally. Apple (AAPL) which rallied over 4 points on Monday slip over 6 points on Tuesday and now sits below key technical levels. However, Amazon (AMZN) was higher and Netflix (NFLX) was barely changed in the stormy Tuesday session. This means that buyers for growth are still lurking in the high grass.

Now you know why I advocated hedging positions as we entered August. However, hedging only reduces risk, but does not completely remove risk, so there was pain to be felt. That is except in bonds or dividend oriented stocks which performed well. The message that the markets got yesterday, or shall I say telegraphed to the FOMC is that the US cannot afford further strength in the US Dollar and hence a rate tightening, widely anticipated in September should be further delayed.

What China did in devaluing its currency is certain not to be a one and done event. Expect further devaluations and what could very well be a Chinese version of quantitative easing.

However, be careful not to hit the panic button. Just as we learned in 1990, 1991, 1997 and 2011; the end of the world did not occur. We took some pain but eventually bounced back. So, the best prescription is to hedge your positions and then as the market declines and uncertainty rises, unwind those hedges and buy stocks in an opportunistic, disciplined and piece meal fashion.

Speaking of China, Alibaba (BABA) will release its quarterly results today. The stock has gone, in very short order from being loved to being hated.

Let’s end on some good news. Soft Idea placed in her race having to overcome a six post position, a strong contender on the rail, the generally lousy Monticello race track and a semi-sloppy condition. If she was not in the 6-hole she would have won, in my opinion. Also, Endless Summer, in her first truly competitive race came in third at Pocono.

Of course, don't forget that in August, Anything Goes ..................

[embed]https://www.youtube.com/watch?v=qo6lPifGnGA[/embed]

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, AMZN, BABA & NFLX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, August 11, 2015: Google Goes Alphabetic

The past week was a great one for my annual pilgrimage to the historic Saratoga Race Track. There was a multitude of clients, friends and their families in attendance, many of which I have been getting together with there for over thirty years. Our trip to The Spa culminated with a fantastic Whitney Stakes, where we got edged out at the finish, costing us a big daily double. For the record, Mitch, my betting partner and Horsepicking.com blogger, and I, started off quite well hitting a big last triple on Wednesday, when also my intern, young Ben broke his maiden (won his first race). However, by the time we left the Spa, we took some small losses.After several days of entertainment, including a day on our boat on Lake George, it was well worth it.

Question for the superb equine artist and avid My Gut Feeling reader, Michael Geraghty - will you be publishing a print of American Pharoah? I have a spot for it in my home in Henderson, NV, so save one for me. Readers - I own several of his prints and if you like thoroughbred racing, you might want to add one to your collection.

August Market Mayhem Begins

The markets in the first week of August, as I suspected, would be biased to the downside. Our hedges helped a little bit but we got hit hard on a few positions, such as Apple (AAPL), Walt Disney (DIS) and Travel Centers of America (TA), making our losses at the track seem insignificant. Then yesterday, the markets spiked, helped by Apple which rose over four points, so we gained back a little bit of last week’s losses. I still expect the next few weeks to be a bit difficult and will keep our hedges on.

Alphabet Formed by Google

After the market closed, Google (GOOGL /GOOG) announced that it was making some corporate changes. The company is creating a new holding company, named Alphabet that will be headed up by founders Larry Page and Sergey Brin. Alphabet will primarily focus on new technologies and ventures that are separate from its core search engine businesses. Sundar Pichai will take over as CEO for the core search business. On the news, both classes of Google stock rose over 6% in the after-hour markets.

Time to Buy Twitter

Yesterday, Twitter (TWTR)' which previously seemed to be left for dead, caught a little spark and the stock climbed 9% on reports that insiders were buying stock. As it turns out, Google announced that it is going to pull the plug on it’s also ran social network, Google +. I have been eyeing Twitter for a while, watching it’s decent as the company’s old management botched the social network's operation. I see opportunity for TWTR, not so much as an independent company but as a part of a larger endeavor. With Alphabet’s new structure and Apple's large cash hoard, Twitter is too cheap to ignore. It will get taken over. I plan on starting a position today.

Finally, all of those people I spent time with last week at Saratoga and the weekend before at my nephew’s Bar Mitzvah, paid me some wonderful compliments for My Gut Feeling. It is great that I have many dedicated readers and have even made them some money along the way – Bernie, stick with that ALPS Medical Breakthroughs ETF (SBIO), even though it got hit with the entire biotech sector last week. What I found out is that many of My Gut Feeling readers forward my daily email to other people, for which I am grateful. However, I am going to ask a favor of everyone. If you are receiving a forwarded copy of My Gut Feeling, kindly sign up for direct distribution at the LakeView Asset Management website toward the bottom of the page. This will help my business with search engines such as Alphabet's Google.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, DIS, GOOG, GOOGL, SBIO & TA — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 30, 2015: Same Old Same Old FOMC Statement

The markets opened higher and held modest gains through the hour when the FOMC released their monetary statement. Then the FOMC told us what we already knew they would; that no rate change was forthcoming and that the economy was improving but that there were still concerns which the monetary body had on their minds. In other words, let’s wait till September.

So, after the announcement, the markets did a little jig lower and then caught a bid, ending nears the day’s highs. A strong dollar continues to result in a weak commodity complex. Someday oil and gold and grains will be buyable. That time is not yet.

As expected, Buffalo Wild Wings (BWLD) surged. We used the opportunity to shave off a little bit of our long-term position in the casual dining chain. Yelp (YELP) and Twitter (TWTR) got hit with the ugly stock. TWTR alter ego, Facebook (FB) reported a good quarter but caught some after-hours profit taking. I believe that stock will make it to $100, at which time you can take some profits.

Whole Foods (WFM) reported a disappointing quarter. The company blamed negative publicity from overcharging accusations. I don’t buy that and think that the company’s margins are being squeezed by competition. The best place to be in this sector is upstream – the organic / health food producers such as White Wave (WWAV) and Hain Celestial (HAIN), rather than the downstream retailers. Back in May, when WFM last reported a disappointing quarter, we swapped gains in WWAV for a position in WFM. Up till Tuesday, WFM was about where we bought it. I am close to swapping back into WWAV and out of WFM, for the very reasons I just stated.

Today, there are a few earnings worth focusing on, such as: Starwood Hotels (HOT), LinkedIn (LNKD) and Molina Health (MOH). Also of note is that today is the penultimate trading day of the month, which is usually positively biased. China appears to be stabilizing after some drastic pullbacks. The Standard & Poor’s 500 (SPX) which had recently corrected 3.5% has now made back about 2.1% of that correction. As I have been saying, I expect one more rush to a new market high before an August / September pullback materializes. We could get one in the magnitude of 5 – 7%.

Next week is my annual pilgrimage to the historic Saratoga Race Course with clients and friends. So, as is usual, I will be armed with my iPad (the track has free WiFi) but shall take the week off from writing.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BWLD, FB, MOH, HAIN and WFM — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 29, 2015: FOMC and Earnings Will Keep Us Busy Today

Our website or server was giving us some issues, so I could not put together commentary from Monday night until this morning.

The markets have been gripped by the sell-off in China and fear of Fed. To be honest, I am not fearful of China. As for the Fed, we will hear from Janet Yellen and her band of merry monetarists today. That should create some intraday volatility in the afternoon. Between Fed anxiety and China, the markets here in the US have put together its worst losing streak since January. We have seen some of those growth tech stocks that I favor being subject to profit taking. However, the end of the world did not materialize and the markets bounced yesterday.

TEVA Drops Mylan

On Monday, Teva (TEVA) dropped its bid for Mylan (MYL) and Mylan shares tumbled. It is likely that TEVA sold out it’s nearly 5% stake of MYL and the arbitrageurs unwound their positions in both stocks. TEVA found another bride, Allergan (AGN) to go after. Recall that we have owned MYL for some time and when that bid from TEVA materialized in the spring, we sold off about 1/3 of our positions. The reason was that you can never assume that an announced deal would be consummated. Hence, it is worth giving up a little upside to lock in gains, which we did. We continue to hold MYL, which is above our original purchase price. Either a new suitor will materialize or investors realize that the stock is more highly valued than the current depressed price.

Earnings Still Dictate Direction

Earnings continue to be favorable in the aggregate. However when a company delivers a disappointing report, it gets taken to the woodshed. Baidu (BIDU), the Chinese Google (GOOGL) was such an example on Tuesday. There are still hundreds of millions of Chinese who are not yet connected to the internet, so BIDU will do just fine in the future. Plus, as Google is shut out of China, BIDU has a monopoly there. Then, after the market closed yesterday, Buffalo Wild Wings (BWLD) reported a good quarter and gave positive guidance. That stock surged nearly 10% in Tuesday’s after-market session. I celebrated BWLD earnings report by going out with some friends to Buffalo Wild Wings. Twitter (TWTR) and Yelp (YELP) both reported disappointing results and guidance. Then they got rewarded with a thumping. So, as you see, earnings are stock specific. Today, two stocks on our blotter, Facebook (FB) and Whole Foods (WFM) will both report results.

The FOMC will be the dog that wags the market today. I do not expect a rate increase. I expect that the FOMC will point toward a September rate increase, but will make no promises. It could wind up being a non-event, but given that the trigger happy traders like to bet on FOMC meetings and statement language, the will be some roller coaster action in the afternoon. Added to that volatility will be the after-hours earnings results. While the Standard & Poos (SPX) 500 took a quick 3.5% dip the past week or so, I expect that it will make some or all of that up before the real August slowdown takes hold of the markets.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BIDU, BWLD, FB, GOOGL, MYL and WFM — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 27, 2015: Divergences Occur Ahead of Fed Meeting

Some interesting divergences are beginning to occur. Let me say that in the short term, this happens all the time. While earnings in general have been better than expected, and growth tech has been surging, the rest of the market seems to have headed to the beaches and golf courses early.
I can attribute this phenomenon to either profit taking or “Fear of Fed.” It is more likely the latter rather than the former, but the former does figure in to some extent. The FOMC will meet this Tuesday and Wednesday to once again ponder its monetary strategy. We will find out, once again, that the Fed will remain “on hold” as it continues to be “data dependent” and keeps one eye on what is happening over in Europe.
While hiring appears to be on the rise and layoffs headed lower, some data points such as housing continues to be volatile and unpredictable. My primary reason for not expecting any FOMC tightening at this meeting continues to be the strong dollar. Any rate rise in the US will further strengthen the US Dollar. Commodities are weak enough as is. Should the US Dollar rise any further, it will set in motion a more rapid decent of gold, crude oil and other commodities.
There is a long list of companies reporting earnings results today, none of which are potential market movers. However, Baidu (BIDU) will report after the market closes from China. We need to hang tight while the Fed watchers and associated traders try to whip saw the markets the next few days. Then I think we get a rally into which we can trim before the wait is too long to get a good spot on the beach or tee time come August. However, the wait is over if you want to see the thoroughbreds at the Spa (Saratoga Race Course), where many money managers, including myself converge for the annual meet.

___________________________________________________________________
Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BIDU — although positions can change at any time.

Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com
© 2015 LakeView Asset Management, LLC. All rights reserved.

My Gut Feeling For Today, July 24, 2015: Amazon Completes Hat Trick

First Netflix (NFLX) reported strong results and its stock surged afterward. Then Google’s (GOOGL) stock ramped up after that company’s earnings report. Last evening Amazon (AMZN) spiked following reporting greater than expected top and bottom lines, completing a growth tech earnings hat trick.. Apple (AAPL) reported a good quarter but that was overshadowed by disappointing iPhone shipments and lowball guidance. That company’s management is notorious for under promising and over delivering. Next on tap in new tech is Facebook (FB) which reports results next Wednesday.

As a matter of trivia, Amazon is now larger in terms of market capitalization than Wal*Mart (WMT). Wal*Mart is still significantly larger in terms of sales.

I cannot emphasize enough that new tech: Apple, Amazon, Google, Netflix and Facebook should be owned; while old tech, International Business Machines (IBM), Cisco (CSCO), Oracle (ORCL), Intel (INTC) and Microsoft ( MSFT) should not. It is as simple as that - out with the old and in with the new. Don’t get hoodwinked into buying those old techs because of higher dividends.

Today we wrap up a week in which 25% of all S&P 500 (SPX) companies will have reported results. The most significant report will come from Biogen (BIIB) today. So far, with about 34% of SPX companies reporting, with the exception of the energy sector, positive surprises are dominating results.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, AMZN, GOOGL, FB & NFLX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 22, 2015: Earnings Stampede Hits Markets

Monday night I decided not to compose any commentary. It was not out of laziness, but rather out of joy as our filly, Soft Idea won her Sire Stakes race at Yonkers, and the post-race celebration lasted a few hours. She is now the top ranked 2 year-old filly pacer in New York State. For full disclosure; my stable partner in South Mountain Stables, Dan Baer; who did not attend the race; was the genius behind buying the horse, at auction. (OK – happy now, Dan?). Unfortunately, our colt was scratched last Friday with a fever. Our next filly will hopefully race in Pennsylvania on Sunday and the Ontario filly is a few weeks away from racing.

Apple Earnings Better Expectations

Last evening, a slew of earnings hit the newswires. The biggie of course was Apple (AAPL). While the company bettered earnings and revenue expectations, iPhone shipments were a bit disappointing to some analysts. Frankly, I think that the revenues would have been much better had it not been for foreign exchange. iWatch sales were not separately disclosed but lumped into the “other” revenue line item. As usual, the company provided soft guidance. Remember that Apple always under promises and over delivers future results. The stock sold off after hours by about 7%, but I do not expect that sell-off to hold in today’s session.

You really cannot rely on the vagaries of after-hours trading, especially after an earnings release. For example, both Chipotle Mexican Grill (CMG) and GoPro (GPRO) reported better than expected quarters. Initially, the after-hours trading buffoons sold off each stock rather dramatically, only to find both stocks reverse course and trade higher by the time the post-closing session closed at 8PM.

International Business Machines (IBM) took the Dow Jones Industrials Average (DJIA) lower on Tuesday after reporting disappointing results on Monday afternoon. Microsoft (MSFT) reported a big loss after writing down its stupid acquisition from Nokia (NOK). Both are prima facie evidence as to why old tech is dead tech.

Blue Buffalo IPO Priced at $20

Last evening, Blue Buffalo (BUFF) priced its IPO at $20 compared to an expected pricing range of $16-$18. Blue Buffalo is a healthy, organic food company for pets. We use its products for our Bichon Frise, Scooter (named for the Scooter Phil Rizzuto) and his brother from another mother, Shitzu Poodle, Carson (named for NY Giants Harry Carson). I am going to consider buying BUFF if I can get it a reasonable price.

Today’s open should be a bit rough given the sell-off in Apple and Mr. Softie. Either that will result in profit taking in other growth oriented stocks or attract buyers to step up for Apple. Mr. Softie is dead to me, no matter what happens to Apple stock. I would suggest that if you don’t own Apple, or don’t have enough exposure to Apple, you might want to take advantage of the depressed prices being offered.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, CMG & GPRO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 20, 2015: Say Yes to Growth; Say No to Gold

Google (GOOG, GOOGL) reported better than expected results on Thursday sparking a surge in the stock by 97 points or 16% the next day. Helping matters was that Friday was options expiration and the wise guy hedge funds were short call options, got squeezed higher and felt pain like kidney stones. It could not happen to a nicer group of people. The Google surge then set off pin action in the rest of the tech sector. That came just after Netflix (NFLX) surged following its better than expect quarterly report and subscriber additions.

Growth stocks are back in vogue. When that happens, investors who had been on the sidelines are afraid of what they have or might miss and jump back in to the market buying with both hands. This is especially true when growth stocks start to accelerate earnings, which is beginning to occur.

Understand something; while growth stocks tend to be in the tech, biotech or consumer discretionary sectors, not all stocks in those sectors are growth stocks. The four horseman of tech from the 1990s – Intel (INTC), Microsoft (MSFT), Oracle (ORCL) and Cisco (CSCO) are all laggards and also rans. Don’t get sucked into those stocks. The new four horsemen are Apple (AAPL), Amazon (AMZN), Google and Netflix (NFLX). They are the growth leaders where cash will flow into. Apple reports results tomorrow and Amazon on Thursday.

In other developments, the Standard & Poor’s 500 (SPX) is now about 6 points away from an all-time high. Gold is falling to multi-year lows on the strength of the dollar. Frankly who wants to own gold which earns no income, pays no dividends and in the absence of inflation, can’t provide economic protection? With gold cheap, expect the doomsayers to come out of the closet declaring that “now is the time to buy gold.” They said the same thing at $1,800 to the ounce. Stick to growth stocks and be selective, as I outlined above.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, AMZN, GOOG, GOOGL & NFLX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 16, 2015: Netflix Proves That Growth Is Alive and Well

The Standard & Poor’s 500 (SPX) broke its winning streak but to quote Maxwell Smart “missed it by that much.” Then again, that is not a bad thing as the market spent the day churning, which sets us up for the next move higher.

That next move can come today as the Greek government approved the debt restructuring deal and after the market closed, Netflix (NFLX) jumped by about 10%. The reason for that surge was the huge amount of subscriber growth in the quarter. Netflix is proving that growth is alive and well in the market. It also shows how the market will pay for topline growth and is less concerned with bottom line results. Another prime example is that of Amazon.com (AMZN) which is all about sales and building out its platform and not about earnings. AMZN stock is up about 50% this year which pales in comparison to NFLX stock doubling this year.

Speaking of growth, Google (GOOG / GOOGL) reports results after the market closes today. It is also a very busy day for financial service company earnings results, including Citigroup (C ) and Goldman Sachs (GS). Domino’s Pizza (DPZ) will report its results as well. I am of the opinion that the entire pizza sub-sector is overvalued and DPZ is set for a fall. I am just not willing to make a short bet until I see the pizza chains put in a true top.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long GOOG, GOOGL & NFLX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 15, 2015: China Not Slowing Down As Much As Expected

Wells Fargo (WFC) and JP Morgan (JPM) set the tone and absent any negative news from Europe the markets put in a solid session. The Standard & Poor’s 500 (SPX) rose for a fourth consecutive day and is higher by 3% from last week’s Grexit anxiety lows. It now stands 1.22% away from its all-time high.

To reiterate what I stated yesterday, I expect the SPX to climb to new highs and beyond, before pulling back for the usual August vacation softness and anxiety of the September FOMC decision. That has not stopped me from taking action within the portfolios. Yesterday, we swapped out what little bit we had left in Yahoo (YHOO) to add to positions in Nordic American Tankers (NAT).

Netflix (NFLX) is going to be in the spotlight today. Before the market opens, shares of the entertainment company will split 7 for 1 and then after the market closes, the company will report its quarterly results. Also reporting quarterly results are an eclectic group of companies, such as: BlackRock (BLK), Intel (INTC), Kinder Morgan (KMI), Seagate Technologies (STX) and, US Bancorp (USB). On top of all that, a slew of economic data will be released, culminating in the Fed’s Beige Book at 2PM.

Overnight, the Bank of Japan held their overnight interest rates steady and the Chinese economy expanded at a 7% annual rate, slightly better than forecasts of 6.8%. Taken together, SPX futures indicated that the rally would extend into a fifth day. Whether or not it does is not that important, because the path of least resistance for the equity markets appears to be higher for now.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long NAT and NFLX— although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 14, 2015: Wall of Worry Has Been Scaled

China appears to have bottomed and is on the rebound. Greece has agreed to terms with Europe and it seems that Europe has agreed to a third Greek bailout. Now we can finally get to earnings. There is no better way to start than today’s crowded calendar which is headlined by the two largest US banks, JP Morgan Chase (JPM) and Wells Fargo (WFC). Also reporting are several other large multinational companies such as CSX (CSX), Johnson & Johnson (JNJ), Las Vegas Sands (LVS) and Yum Brands (YUM). To add even more excitement will be the release of June retail sales.

Not only do I believe that we scaled the recent Wall of Worry but I expect that the major indexes are going to make new highs by the end of this month. We will probably advance beyond that a little bit after which, you might get a chance to lighten up before the mid-September FOMC meeting. To begin with, there should be the usual August doldrums. Then, given that most of the investing world believes that the FOMC will begin to tighten at the September meeting, there should be a buildup of anxiety in early September.

I will reiterate what I have been saying for some time, namely that the thirty-five year-old bond bull market is over. Expect negative total returns from long-term bonds. Try to keep maturities to seven years or less. Seek dividend yielding stocks over bonds. Still, low rates of interest will keep cost of capital cheap and the debt issuance spigot open for corporate buybacks and acquisitions.

After a solid two day run, the markets are poised for a little rest. Expect earnings and retail sales figures to dictate market direction today.

P.S. - The filly ran third and the colt ran out of the money.

__________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long JNJ and YUM — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 9, 2015: Technological Issues Grips Markets

Wednesday was a strange day for the markets. The Greek story was on the back page as the next act won’t play out till this weekend. In fact, the major European Bourses rallied nicely on Wednesday.

The day started off a bit rocky due to the weakness in China that spilled over from the mainland to Hong Kong, which is a bit worrisome. Here is what is happening there. Chinese investors have borrowed huge sums of money to finance stock purchases. They did most of that after the Chinese markets rose rather dramatically. Most of the stock speculation is not in the large Chinese companies but rather the tiny ones, which are of dubious nature. We stick to the big names such as Baidu (BIDU), Alibaba (BABA) and Tencent (TCHEY). The meltdown in the Chinese markets gives us the potential to add to positions at fire sale prices.

We could have survived the spill over from China and might have reversed course, as the markets did on Tuesday. However, there was a technological problem at United Airlines (UAL) which grounded flights for several hours. That was followed up by the shutdown of trading on the NYSE which is owned by the Intercontinental Exchange (ICE). To top it all off, The Wall Street Journal also suffered a technological shutdown as its site was overwhelmed by people seeking information on the NYSE.

Even though the volume of share trading on a normal day on the NYSE is not large and a small fraction of what it used to be, it sent shivers down traders’ spines. Put together with the UAL and Wall Street Journal shutdowns, fears of cyber terrorism gripped the markets. In the fullness of time, it was meaningless and we will recall it in the future, but it was not fun to watch as it was occurring.

As it turns out, it was not a cyber-attack at the NYSE but one of a few possible problems: i) human error by the NYSE; ii) high frequency trading activity; or, iii) hardware issues at the NYSE. Still, by the time the NYSE opened back up around 3:15, the damage was done.

Interestingly enough, we own shares of FireEye (FEYE) a cyber-security solutions company which was up for most of the trading day. I have also had my eye on PureFunds ISE Cyber Security ETF (HACK) for a few weeks to add more exposure to the sector. That stock was off about 10% from its recent high and was down in Wednesday’s session. That gave us an opportunity to step up and buy HACK.

As for today, Greece remains on the back burner, the NYSE issue is over and done with, and the Chinese markets were rallying overnight. Perhaps we have put in a bottom to the markets’ recent Greece related sell-off which began about two weeks ago and has trimmed the S&P 500 (SPX) by about 4%. While a 4% decline might seem like the end of the world, it is far from it.

On Friday my filly Soft Idea goes for her second win at Saratoga Harness track. On Saturday my colt Numerouno Bluechip makes his debut at Yonkers. I don’t own the horses in their entirety, but fractions of those two horse plus three others, of which one is with foal in Kentucky.

SARATOGA HARNESS TENTH RACE 7/10/15

Condition: New York Sire Stakes - 2-Year-Old FIllies Declaration Fee - $910

Gait: Pace

Purse: $50,741

Class: NYSS

Dis: 1 Mile

HN	PP	Horse	Driver	Trainer	Years Best	Last 3	Odds
1	1	FAMILY ROLL CALL	Bi Dobson	Ed Hart	X-X-X	6-8-3	15-1
2	2	GOTMYREDRESSONTNIT	Wa Hennessey	Ja Connor	1:55.3	1-1-1	7-5
3	3	SOFT IDEA	Ja Morrill Jr	Li Toscano	1:57.3	1-1-3	7-2
4	4	IDEAL FANTASY	Pa Berry	Ca Auciello	X-X-X	9-3-3	8-1
5	5	WISHY WASHY GIRL	Br Aldrich Jr	Ra Schnittker	X-X-X	2-2-2	5-1
6	6	FLOWER BOMB	Ma Beckwith	Tr Smedshammer	X-X-X	4-3-2	10-1
7	7	GHOST RUNNER	Th Jackson	Th Jackson	1:58.1	4-6-1	12-1
8	8	MOTHER OF ART	Ja Devaux	Ro Burke	X-X-X	4-4-3	20-1

YONKERS SEVENTH RACE 7/11/15

Condition: THE $157,500 LAWRENCE B. SHEPPARD ELIMINATION 2 YEAR OLD COLTS & GELDINGS **2ND ELIMINATION**

Gait: Pace

Purse: $25,000

Class: SHEPPELIM

Dis: 1 Mile

HN	PP	Horse	Driver	Trainer	Years Best	Last 3	Odds
1	1	ENDEAVOR	Pa Lachance	Pa Lachance	1:59.2	3-1-1	3-1
2	2	NUMEROUNO BLUECHIP	Ja Bartlett	Li Toscano	X-X-X	3-5-X	7-1
3	3	ARTMAGIC	Br Sears	Tr Smedshammer	X-X-X	3-3-X	6-1
4	4	JOE LARRY N CURLY	Ge Brennan	Ma Harder	1:55.3	1-1-1	1-1
5	5	WAR-N-MUNN	Da Dube	Ke Warner	X-X-X	2-3-2	20-1
6	6	TAILGUNNER HANOVER	Ra Schnittker	Ra Schnittker	1:57.3	1-8-3	12-1
7	7	FLY WITH THE BEST	Ma MacDonald	Ke Johnson	X-X-X	2-2-6	20-1

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BIDU, BABA, TCEHY, FEYE and HACK — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 7, 2015: Time Is Running Out For Greece

The markets opened to the downside on Monday, but not as significantly as overnight futures had indicated. Buyers stepped up to actually erase losses and go slightly in the green for a short period of time. Then after France and Germany, told Greece that they would only consider a credible offer by Greece to resolve its insolvency; the markets backed off again. The Netherlands also had some strongly worded warnings for Greece. Soon that decline was reversed and the US markets closed about 3/8% lower on average, across the board

We used some of the midday strength to sell positions in Cummins (CMI), which never panned out to our expectations, resulting in a small loss to the Growth portfolio accounts. As CMI was our second smallest position in that strategy, the damage was not bad. This leaves us with some cash, with which I have an eye on a restaurant stock to put money to work in.

Also worth looking at are shares of energy companies. After selling shares in energy related companies earlier this year, crude oil prices have collapsed once again. We may have another opportunity to reenter a trade in the Energy Select Sector SPDRs (XLE).

My appearance on Bloomberg Radio was extended to two segments. In the first, I discussed the situation in Greece. In the second one, I discussed restaurant stocks. Both segments can be heard on this: podcast

Another emergency meeting amongst the major creditor nations will take place today. At this point, I believe that Germany’s Merkel and France’s Hollande are running out of patience. In fact, they gave Greece a 24-hour ultimatum to come up with a better plan or face ejection from the Euro.

Unfortunately, earnings season does not get into full swing till next week, although The Container Store (TCS) reports today and Alcoa (AA) will report tomorrow, Hence, we are going to have to continue to sit on this Greek hemorrhoid. Futures indicate that the markets will wipe out Monday’s declines. Normally, I would expect a turnaround Tuesday but with the Greek drama continuing to play out, I won’t be so bold as to speculate how the markets will perform by the end of the session.

___________________________________________________________________

Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, July 6, 2015: The Next Weimar Republic

The Greek people voted overwhelmingly to turn down the debt restructuring plan offered by the ECB, EU and IMF. There are essentially two ways forward. First, Greece could leave, or shall I say get kicked out of the Euro. Second, the parties could come back to the bargaining table to draw up a less austere bailout. I expect an attempt at the latter but given the unwillingness of the Greek leadership to compromise, the former may become a reality.

Face it, collectively; Greece is acting like Audrey 2 and treating Europe and the rest of the world like Seymour Krelborn. Frankly, I could care less if Greece would have to put the Parthenon up for sale on EBay (EBAY) to pay its debts. The retired schoolteacher from California will not be happy if the value of their pension plan declines because of Greece. Greece’s economy is mostly service based, which is tourism. You can bet that Europeans will be taking vacations to nations other than Greece in the future.

The problem is that should Greece revert to its own sovereign currency, the Drachma (at least that’s what is was called in the past), the nation will be significantly worse off. Greeks will hoard Euros and not want to hold drachma. The new currency will decline in value dramatically and the cost to pay off its Euro denominated debt will surge. Greece will be forced to print drachma causing hyperinflation. Unemployment will surge as the economy seizes up. What you will have is a modern day version of the Weimar Republic. The only difference is that the world won’t be in fear of a militaristic Greece as it was of Germany under the Third Reich.

So here we are in the middle of the night, US futures are off about 1.2%, which is not going to make that Californian pensioner real happy. I can tell you that the goings on in Europe did not keep Americans off the road for the 4th of July weekend. The US economy is doing just fine, although it could be better. Energy and food prices are low with no real signs of inflation on the horizon. Earnings season is upon us and I expect that money managers will focus on earnings and put Greece out of their minds, where it should be. Of coursse, here in the US, it always seems ot be merger and acquisition season.

Finally, today I am appearing on Bloomberg Radio's The Bloomberg Advantage at 1:30 with Carol Massar and Cory Johnson to discuss restaurant stocks for the second half of 2015.

___________________________________________________________________

My Gut Feeling For Today, June 30, 2015: Excuses to Sell Come Out of the Closet

While the US market did not open as poorly on Monday as overnight futures indicated, once the European markets were closing and Europeans could raise cash in the US markets, we sank to the day’s lows. Not only did we close at those lows but two major indexes – the Dow Jones Industrials (INDU) and Standard & Poor’s 500 (SPX) are now in the red for the year.

What occurred was that a confluence of excuses to sell stocks all converged at the same time. This resulted in an ugly session and continuance of recent market weakness for the last week. So what were these excuses?

Greece, of course. The most selfish nation on the planet is not only intransigent but is also trying to hold itself out as the victim. When you owe EUR 300 billion or so, you are the perpetrator, not the victim.
The Fed. While I expected a Fed official to make some comment that the situation in Greece which resulted in a stronger US Dollar might put the FOMC on hold, a Fed President make a statement to the contrary. William Dudley, the president of the Reserve Bank of New York, said that a September interest rate hike is “very much in play.” Dumb.
Puerto Rico. Neither the Jets nor the Sharks can help out Puerto Rico. The island’s governor said that its $72 billion in debt is “not payable.” Fear not, most of that debt is held by hedge funds and bond funds. A default could not happen to a nicer group of investors.
China, as defined by the Shanghai market is now down 20% which some define as to be in a bear market. The more important market from that nation, which is more reliable and less influenced by central Chinese government manipulation is the Hong Kong Market. The Hong Kong Hang Seng Index (HSI) is off about 9% from its peak.
End of the quarter. What better time than to hit the sell button?
The FBI and Homeland Security warning of a possible domestic terrorist attack in the US by ISIS over the Independence Day weekend.

Understand that there is a big difference between these events and the fundamental strength in the US economy and stock market. Pullbacks happen. It is a fool’s errand to pick when they start and when they end. The SPX is now 3.6% off of its all-time high. It may feel awful to some, and hurts just as the quarter is drawing to a close, but I can tell you as a professional, its business as usual. Perhaps we pullback another 2 – 5%; based on more fear or panic. Maybe I will raise a little cash and redeploy it a bit lower. Recall that I expected to do so in early July anyway. As my friend and analyst Tony Dwyer wrote in his Monday research, “the question isn’t whether you are a buyer, but where to be a more aggressive buyer.” I am comfortable with the fundamental underpinning of the markets, the economy and our positions, so I don’t recommend abandoning the equity market as a long term investment strategy.

Interestingly enough, two positions that I have been vocal about as investments, Zoe’s Kitchen (ZOES) and Nordic American Tankers (NAT) both rose in Monday’s session.

As for today, a bounce is indicated by overnight futures and is likely to occur as cooler heads prevail after yesterday’s drubbing.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long NAT and ZOES — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 29, 2015: Greece - The World’s Most Selfish Nation

I did not venture away from home base this weekend, so I am able to pen my commentary for today. As it turns out, I have a fair amount to say, and I won’t bite my tongue.

Greece is by far the world’s most selfish nation. Don’t get me wrong, this is not an indictment of people of Greek heritage. I know many and count them amongst my oldest friends. Rather I am talking about the Hellenic, I mean, Socialist Republic of Greece, a nation of about 11 million people in the southeastern part of Europe. It is a beautiful county, steeped in great cultural contributions to the world. It is also a financial mess.

The Greek nation led by the ultra-left Alexis Tsipras has a 1.6 billion euro payment due to the IMF on June 30. It does not appear that the payment will be made as no agreement was reached with the International Monetary Fund (IMF) and European Central Bank (ECB) to reschedule, extend or modify the debt structure. Rather, Tsipras dug in his heels and will put the matter to a national referendum on July 5.

Technically, Greece will not be in default but will be in arrears and get some strongly worded letters from the IMF demanding payment. The ECB will not extend its credit facility to Greek banks. The fact remains that Tsipras played a game of chicken and lost. Over the weekend there was a run on Greece’s banks. The government had to declare a bank holiday on Monday and enact capital controls.So, if you are in Greece for a vacation, you will have to get around without access to ATMs or use of credit cards. If you are planning a trip there this summer, think twice.

You don’t get into a situation like this unless you have had a long running history of financial malfeasance. Tsipras did not cause the problem; he just did not solve it and made it worse. This is a nation that has chosen to live off of transfer payments, which is an economist’s term for entitlements. Lop on top of that a failure to pay taxes by citizens and collect by the government and you can see the problems mounting.

Greece is the poster child for all that is wrong about socialism. What is left of the USSR in Russia is not a mess like Greece. The United States ought to be careful. If it continues down a road of burgeoning entitlements and expanding debt with an onerous tax code, it could face Greece’s fate in the future. When that future is, I cannot say. My guess is that it won’t be for a few generations, likely later in this century. However, we have time to fix all of that in the USA. We just have to learn to say NO when the Greeks could not.

You might not like supply side "trickle down" economics, especially if you are liberal minded. However, it has proven to work much better than "hands-out" economics of a socialist entitlement system.

As for the markets, US index futures were indicating a lower market open by about 1.6% at about 9PM EDST. Of course, that is only an indication. Should the market hold those lower levels, or get even worse, it would, as we are in the penultimate trading day of June, ruin an otherwise good quarter for our stock portfolios. I would further note that the Euro was weakening as the US Dollar was strengthening and crude oil prices were falling in the evening.

So, as an economist, I am going to look at the short-term and long-term implications of the Greek bank shutdown and failure to make the June 30 payment to the IMF.

In the short-term, markets will sell-off and to some extent begin to panic. I can’t say it will be a full-fledged Ebola style panic like last fall, but we will get a mini-panic. The panic will come in the form of fear for a Greek exit (Grexit) from the Euro. This is not going to bode well for the end of the quarter. That of course assumes that nothing happens between now and tomorrow’s market close. There are some things that could quite well occur:

The ECB ponies up some short term financing to help make the IMF payment
The IMF defers the payment
Russia gets into the act and offers loans for other concessions
The US gets involved in some way with direct loans or loan guarantees. Not smart financially, but it might be a measure to protect NATO and ward off Russian advances on Greece
A US Fed official (this is the most likely case) goes on record as saying that the FOMC will hold off on any rate hikes until such time as the Greek debt situation is resolved and the Euro is stable
Tsipras cancels the referendum and agrees to the terms of the creditors.

On top of everything else, let’s not lose sight of important economic data releases in the US this week, culminating with June’s labor report on Friday.

In the long-term, global markets will reach equilibrium. Either Greece will come to an agreement which just kicks the can down the road or the ECB cauterizes Greece off from the rest of Eurozone. The impact to US stock markets will be fleeting and have no long-term effect. I do not see the Greek situation as catastrophic to US financial markets as was the Latin American crisis of the late 1980s.

In conclusion, let’s not panic. It is not worth trying to game by selling stock today and trying to catch a bottom. Let’s remember what happened on October 15 of last year when an early morning panic reversed. from there the markets rose handsomely. Unfortunately, there will be some short term damage, which as I say is a shame as the quarter is about to end.

_____________________________________________________________________________________________________________________________________________

My Gut Feeling For Today, June 26, 2015: Riding the Equity Treadmill

Since I last wrote, we have had a series of teeter-totter sessions – up, down, up, down – winding up nowhere, in a relative sense. In fact, if you go back to April 10, the Standard & Poor’s 500 (SPX) has been on a treadmill. Until there is a resolution in Brussels for the Greek debt issue, or earnings season starts in two weeks, we may remain on that virtual treadmill. Just about the only event that could get us zigging or zagging will be the impact of the end of the second quarter and beginning of the third quarter next week as pension managers perform some window dressing in June and put fresh cash to work in July.

Netflix (NFLX) announced on Wednesday that the company would spilt seven for one effective July 15. Yesterday the stock received a downgrade from an analyst, although that same analyst has a price target greater than where the stock closed yesterday. As you can see, those Wall Street analysts are not value added.

Also of interest is the announcement that Aetna (AET) is close to buying Humana (HUM). A formal announcement will likely take place today or as late as Monday. In other healthcare news, the US Supreme Court found in favor of the US Government in a lawsuit challenging the Affordable Care Act. The US markets did not flinch based upon that high court ruling.

All that is left for us is an opportunity to take a hard look at the portfolios as we wrap up the second quarter and look ahead to the second half of the year. To begin with, we will jettison our investment position in Marathon Petroleum (MPC) which went long term for capital gains purposes yesterday. With some of that cash we are adding to positions in Nordic American Tankers (NAT).

So, as repetitive as this may sound, just hang in there while the Europeans get their financial house back in order. I will be travelling Monday night and return with commentary on Tuesday.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long NFLX, NAT and MPC — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investingwith LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 22, 2015: Expect the FOG (Fear of Greece) To Lift

Last week was a pretty good one, despite the hoops we had to jump through – FOMC, Greece and expiration - to get to Friday’s close. The NASDAQ 100 rose 1.32% and Standard & Poor’s 500 (SPX) tacked on about ¾%. Friday’s expiration and FOG (Fear of Greece) resulted in some profit taking ahead of the weekend.

Over the weekend, talks continued on restructuring / extending Greek debt payments. Greece and its Prime Minister are running out of time and they have little or no wiggle room to work with. While June 30 is the official deadline, some agreement is likely to be struck this week. Once that happens, and I think it will, the bears will have no more reasons to scare investors from the markets. Also, I think you can play gold on the short side after an agreement is met. I would play it with ProShares Ultra Short Gold ETF (GLL)

On Friday, Zoe’s Kitchen (ZOES) got hit. The primary reason was the resignation, without reason, of the company’s CFO. To some people this raises a red flag. However, there is no reason to believe that any hanky took place. The second reason was an analyst downgrade. Neither reason negates the long term growth that this restaurant company is certain to enjoy over the next few years. We added to positions in ZOES on the sell-off.

We have a position with some handsome appreciation that will turn into long term gains later this week, at which time, we are likely to book those profits. With the proceeds we are looking to add to technology or financial sector holdings.

As for today, expect a mirror image open to the upside offsetting Friday’s derivative expiry losses. Then we are back to the waiting game in Europe, which as I expect will get resolved by week’s end.

Tonight I am headed to Yankee Stadium with a broker buddy in the evening. Then tomorrow I will take the day off to attend my son’s high school graduation and host a party at our home. Of course, I am always plugged into the markets with my wireless devices. I will be back with more commentary later in the week.

___________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long QLD & ZOES — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 18, 2015: FOMC Plays Wait and See, But Markets Will Forge Ahead

As I expected, the FOMC did not raise rates, did not provide a timeline to raising rates and reiterated its stance on being data dependent before making any monetary decision. In other words, it was business as usual for the FOMC. It was one big non-event, except for the bears - stock and bond - who once again were disappointed. Also as expected, the markets were flattish until the 2PM FOMC announcement and then caught a post-FOMC bid.

Of course, the usual whining took place from those who keep fighting the Fed. The problem is not with the FOMC, as they profess. Rather, it is with the majority of the public who do not understand how the FOMC, central banks or monetary policy operates. They need to stop blaming the Fed for everything under the sun including their own underperformance. It is very simple; the economy is improving, despite the harsh winter, and Europe, but at exceptionally slow rates relative to prior post-recession recoveries. Data dependent means data dependent, nothing more nothing less.

So, here we are with no other FOMC meeting to distract the markets till the very end of July. That, coincidentally is after the heart of earnings season has passed. Hence, we will focus on earnings and macro-economic data for the next six weeks. Standard & Poor’s estimates that second quarter earnings will decline about 2.8% year-over-year for the S&P 500 (SPX) index. With the US Dollar rising nearly 20% over that period of time, most if not more than that decline is from currency fluctuations. In my opinion, the bar is being set low enough to expect earnings surprises on the individual company and index levels.

The market still has to get over the annoyance of the quarterly derivative expiration on Friday. As for today, we should see the dollar weaken, bonds and stocks catch a bid, but overall a quiet session with some likely positive follow-thru from yesterday. Overall, we want to stick to our convictions that the markets will rise to new highs and not get caught up by short term diversions.

_________________________________________________________________________

My Gut Feeling For Today, June 17, 2015: FOMC Non-decision is Expected Today

It was such a slow news day that Donald Trump used the opportunity to announce his candidacy for President of the United States. However, the markets were kind of quiet ahead of the announcement and then bounced higher afterward, closing about 1/2% higher on the day. Big business likes big businessmen. There were scant rumors as well that some progress was being made on the Greek debt front.

Today the Federal Reserve Open Market Committee (FOMC) will come down from its own Mount Olympus to deliver its interest rate policy decision. The decision will be a non-decision as they are likely to take no action today. However, what will be the fulcrum for the markets will be the FOMC statement in which many observers expect that the monetary authority will commit to a September rate rise. Don’t expect any explicit timing for a rate increase, rather some more fed speak which will be subject to interpretation.

Income stocks, i.e. those with above market average dividends, have had a rough year, in anticipation or shall I say in fear of a rate rise. For example, the Philadelphia Utility Index (UTY) is off 11% this year on a price basis and the S&P 500 Low Volatility / High Dividend Index is off 2.11% year-to-date. I think that those declines are overdone and those indexes may actually rise after an eventual rate hike. With the built-in dividend protection of these stocks, I do not think one needs to panic with a dividend oriented investment approach.

I would suggest catching up on paper work and taking a long lunch ahead of the 2PM interest rate decision. The fun will begin after 2PM.

____________________________________________________________________

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

My Gut Feeling For Today, June 16, 2015: Greece Bends But Does Not Break Markets

The markets around the globe were lower on the breakdown in talks over Greek debt. Here in the US, the stock markets opened lower, bottomed in the morning and then rallied to close well off of the day’s lows. In my opinion, weak holders sold early on the Greek inaction leaving opportunity for investors to step up to buy in the afternoon. In the fullness of time, the Greek drama will turn into a non-event.

There was really not much to grasp onto during Monday’s session. With the FOMC set to meet the next two days and release its policy statement on Wednesday afternoon, we will have to endure a day and a half of uninspiring action before getting some post-FOMC gyrations.

The Gap (GPS) announced that it will close 175 stores and cut job at its headquarters. This is just confirmation of what I have been saying for some time, namely, that the apparel business is weak and that retail malls are in trouble.

Having moved clients out of their fixed income components within balanced portfolios last week, we were sitting on some cash. I plan on putting that cash to work today into equities. Other than adding to positions in Dick’s Sporting Goods (DKS), I wil not be putting any cash to work in the retail / apparel industry.

____________________________________________________________________

My Gut Feeling For Today, June 15, 2015: Time to Finally Move Out of Fixed Income

It is hard to believe that we are halfway through June and nearly halfway through 2015. However, it is best we take it one day or week at a time. Last week was a productive wone. The Standard & Poor’s 500 (SPX) was flat, against a backdrop of positive domestic economic data. Our Growth and Restaurant & Food Chain Portfolios were positioned in the right stocks and we had some nice absolute and relative performance.

I made a call to our clients with Balanced accounts, i.e. those with a mix of both Growth and fixed income weighting, in which I recommended moving the fixed income portion into equities and abandoning their fixed income allocation. Bond fund redemptions are running at very high levels. Interest rates are creeping up with or without policy changes by the FOMC. I no longer see the voracious appetite for buying bonds at all maturities at record low yields, especially as new paper continues to hit the market

For those of our clients who insist on staying in fixed income securities, we are going to reduce our average duration and increase, where appropriate, exposure to equity linked securities.

On Sunday, talks between Greek and European officials, really Greek and German officials broke down. Hence, this week, the Greek debt situation will dominate headlines and could rattle markets even in the United States, at least in the early part of the week. In fact, overnight futures indicate a lower open in the US today. However, from there we turn to the FOMC rate decision on Wednesday. I expect nothing will be announced in terms of rate increases. Then on Friday, there will be an important quarterly derivative expiration which will have great influence on the markets come Thursday afternoon and Friday.

All I can really say is; sit back, observe and enjoy what goes on this week, while you are getting out of your fixed income positions.

____________________________________________________________________

My Gut Feeling For Today, June 10, 2015: The Best “Z” Stock: Zoe's Kitchen

The markets bottomed in the first hour or so of trading and then, as I expected, the buyers stepped in. While the S&P 500 (SPX) halted its three day losing streak, it did so by less than one index point. The Dow Jones Industrials (INDU) and NASDAQ 100 (NDX) finished modestly in the red. What I found most impressive is that the markets did not flinch despite an evacuation of the White House.

Within the wishy-washy market of the last month, there are some notable stocks and sectors exhibiting strength. As I mentioned yesterday, the financials are showing leadership and scored gains on the day. Stifel Financial (SF), a St. Louis based financial services company continues its expansion, having added Barclay’s US Wealth management business to its portfolio, yesterday.

Zoe’s Kitchen (ZOES), a stock that we have placed great expectations and capital on, scored a new 52-week high. The company reported better than expected results next week. I am on record as saying that ZOES could be the next Chipotle Mexican Grill (CMG). How funny that my two favorite stocks seem to be one at the very beginning of the alphabet: Apple (AAPL) and one at the very end: ZOES. It enforces the conclusion from my co-authored paper ABCs of Trading that you should perform research based on stock metrics and not be biased by alphabetical order.

The economic and earnings calendar is rather desolate today. Hence, there is not much to trade off of, other than the usual trio of China, Greece and the FOMC, all of which is old news. Rather, I expect yesterday’s turnaround to pick up steam as the major indexes begin to retrace some recent lost ground and get back on a trajectory of setting new highs. I have an evening event in Philadelphia and will return with more commentary on Friday.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, CMG, QLd and ZOES — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 9, 2015: Financials Emerge As Leaders

The markets drifted lower again but nothing of major consequence. Apple (AAPL) held its worldwide developers conference or WWDC. While that is really a means of delivering information to developers, it has become another platform for Apple to reveal updates and product changes. Yesterday was no different as Apple unveiled a streaming music service and operating system upgrade. None of those announcements were earth shattering or market moving.

In the meantime, one group that is beginning to exhibit leadership is the financial sector. This is an important market development. Recall that we recently took positions in SPDR Regional Banking ETF (KRE). We also hold an older stake in Discover Financial Services (DFS). On the other hand, transportation stocks, which we exited a few weeks ago, are exhibiting weakness. People who swear by Dow Theory see the latter development as a bad sign. Investors who understand the importance of a strong financial sector see the development within the financial sector as a strong sign. I believe in the latter not the former. Likely, the markets will continue to dither about in a trading range for a bit linger.

While there is great debate as to the direction of the stock markets, there is little debate as to where fixed income markets are headed in the US. Bond prices are declining and yields are rising, with or without the FOMC taking any action.

Wynn Resorts (WYN), a short position which I have been writing about recently, got clocked yesterday, wiping out any gains from a recent analyst upgrade.

China and Greece remain hot topics in the financial media. The Chinese markets remain hot, reminiscent of the Japanese markets of the 1980s and US Technology boom of the 1990s. What we have learned is that you stick with these exuberant markets until they stop working. The clock is winding down for Greece's payment due date, but expect that can to get kicked down the road again.

I expect another lethargic day. It is likely that we open soft but don’t be surprised if buyers step up to drive a Turnaround Tuesday.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long DFS and KREand short WYNN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 5, 2015: Europe: The Turd in the World’s Economic Punchbowl

We were set up for another fairly quiet day. A lower open attracted some buyers. But then the Europeans ruined the party for everyone. Christine Lagarde, the French head of the International Monetary Fund or IMF strongly suggested that the US Central Bank, Federal Reserve hold off on any monetary tightening till 2016. That is because Europe is still an economic and monetary mess. Then the oldie but badie concerns over Greece sent another round of jitters through the markets. This sent the stock renters selling in a panic ahead of today’s labor report. Soon after, the major indexes fell over 1% but then recovered in the final hour, still closing in the red by about 0.8%.

Labor report Will Dictate Market Direction

Europe aside, what is going to really matter is today’s labor report for May. Expectations are for 225,000, plus or minus a few thousand, jobs to be added. That seems like a reasonable expectation and within trend lines, save one outlier month, likely due to the winter weather. I expect retail jobs to be weak but construction hiring to pick up.

Wynn Resorts (WYNN), which was acting like a great short, suddenly spiked higher on an analyst upgrade. I don’t think that a bottom is in yet for that stock.

Opko Health (OPK) got sold hard after agreeing to purchase Bio-Reference Labs (BRLI) for 2.75 shares of OPK. So, the arbs were in force buying BRLI and shorting OPK. At current prices, BRLI is selling at a nice discount to the deal price. While we owned OPK going into the deal announcement, we nibbled on some BRLI to take advantage of the risk arb discount.

What everyone will be talking about the rest of today and into tomorrow is the Belmont Stakes. If I was not in upstate NY I would be going. That being said, American Pharoah is vying for a Triple Crown and is a prohibitive favorite at 3-5. My biggest mistake ever at the racetrack (and trust me when I tell you I have done quite well there) was in 1999 when I was at the Belmont Stakes as Charismatic tried to capture the Triple Crown. I handicapped Lemon Drop Kid to win the race. Lemon Drop kid has great bloodlines and was set up to win the race. I told everyone I could to bet Lemon Drop Kid. Foolishly, I did not and instead bought a few $1 win tickets on Charismatic, thinking that if he won, I would not cash them in and sell them on EBay (EBAY). Lemon Drop Kid won at a big price. As I said, my biggest mistake at the track.

Handicapping the Belmont Stakes

This time around, I won’t make the same mistake. I like Frosted. Frosted is well rested after skipping the Preakness. After a bad early start and wide trip, Frosted came on quite strong in the Kentucky Derby to finish 4th. Had the colt more room to run, as it does in the Belmont Stakes, it might have caught the winner. The early line on Frosted is 5-1 but will likely come off to 4-1 or 9-2 by post time. I will bet Frosted to win and in some exactas with the Pharoah and perhaps Materiality.

I will be travelling late Sunday and will be back with commentary for Tuesday.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long OPK & BRLI and short WYNN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 4, 2015: Egg Prices Get Jumbo Extra Large

Tuesday night I got hit with some bug. So, I decided to try to get a good night sleep and passed on penning (is that the correct term, as nobody really puts pen to paper anymore?) commentary for yesterday. As it turned out, Wednesday was just another session where the major indexes barely moved, but like Tuesday, Wednesday’s move was incrementally higher.

I did manage to have a productive day in the markets. For our Growth Strategy we swapped out of shares of Swift Transportation (SWFT), a trucking and logistics company for shares of Molina Healthcare (MOH). MOH stock was down all session after announcing a secondary offering. It was the perfect time to buy stock, some of which we did in the market, some we received in the secondary offering.

Then for our Restaurant & Food Strategy accounts, we bought shares of Cal-Maine (CALM) and shorted, in appropriate accounts, shares of Denny’s (DENN). The reason was that in the past year, the cost of eggs have surged nearly 90%. CALM is the nation’s largest egg producer.

Yesterday ADP (ADP) released its monthly employment report. Tomorrow the Bureau of Labor Statistics will release its jobs report for May. That leaves us stuck between the two events, in what is certain to be another tight range trading session. The fanfare will come tomorrow. Also tomorrow, my Belmont Stakes pick.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long CAPLM & MOH and short DENN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 2, 2015: More Mergers & Acquisitions Are On the Way

As I expected, Monday turned into a mirror image of Friday’s session, whereby the markets rose modestly, offsetting Friday’s modest declines. A big tech takeover in which Intel (INTC) agreed to purchase Altera (ALTR) for $16.7 billion in cash was announced. If INTC does not have the cash, the company will raise it in the credit markets at low rates for a long period of time, without any problem.

It is these low interest rates, which will continue for some time, whether or not the FOMC tightens modestly, that is fueling growing merger and acquisition activity. Low costs of capital make it easier for companies to buy rather than build. Prognosticating a potential takeover is a tough endeavor, but can be done from time to time, Look for second tier firms, not in terms of quality but market cap that have unique products or business lines. From those stocks you might have a potential takeover candidate. I have had many stocks taken over my three decades of investing. The only stock that I foresaw as a takeover candidate that came true was Caribou Coffee, which I think went too cheap.

Opko (OPK), one of our two big drug / healthcare plays along with Mylan (MYL) surged nearly 4% on news that the company submitted a new drug application to the FDA. Imagine what will happen to the stock if the application is approved.

The economic calendar will deliver factory orders for Aopril, which if you ask me is stale data, so it might not carry much weight. As for earnings, they are now far and few between, with only Cracker Barrel (CBRL) interesting yours truly.

The story is the same: equity markets will continue to bounce around while you should be prepared for what I believe is certain to be another run at all-time highs in the major indexes sometime in June. In the current market environment, cash is not your friend, stocks are.

______________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MYL & OPK — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, June 1, 2015: June Will Be Too Close to Call

As expected, traders used the GDP data to take profits into the month end, although, the damage was contained. We enter the month of June with the Standard & Poor’s 500 Index (SPX) ahead by 2.36% for the year. By no stretch of the imagination has the stock market been easy sledding. While the SPX is about 1.3% below its all-time high, the tide had not raised all boats. Rather, you have had to be wise to either be in the right stocks and sectors or have avoided the wrong ones. I think that it has been easier to do the latter than the former.

Historically, June has been a flat month over time for the SPX. However, in pre-Presidential election years, which we are now in, it is, on average, the fifth best month in such years, averaging a gain of 1.29%. Then again, the SPX did not rise in a pre-election year since 2003.When you put it all together, this June could go either way, and on the first day of the month, will be too close to call. I believe, it will all be a function of economic data early in the month and the mid-month FOMC meeting. As a result, I am likely to take a wait and see approach.

On Friday, as I expected, we sold some smaller positions and put most but not all of the proceeds into a regional bank exchange traded fund, SPDR Regional Banking ETF (KRE) which we were able to accumulate on a down day.

As for today, I expect a little bounce back in the early going, to offset some of Friday’s profit taking. Barron’s had a positive cover story on Walt Disney (DIS) which should put a bid into that stock. More angst over Greece’s debt problems and China’s on-again-off-again economic data will make headlines this week.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long DIS & KRE — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 29, 2015: GDP Could Add Volatility to the End of May

Tuesday’s one-day blunder gave investors the opportunity to snatch up stocks at a discount, which they did. On Thursday the market resumed its recent slow motion flat lining action. Perhaps, traders were taking a day off before today’s busy economic calendar.

Before the market opens, the second stab at 1st quarter GDP and the Chicago Purchasing Managers Index (PMI) will be released. Then later in the morning, the final Michigan Sentiment survey for May will be released. The GDP number could be a market mover, if it comes in dramatically worse than the first estimate for last quarter.

It is the last trading day of the month, which also can also add some volatility to the equation. After a rise of 1.69% in May, the renters will be looking for any excuse for profit taking. Should today be a down session; be prepared to be buyers at the close.

I plan on using the trading session to adjust our portfolios. I am seeking to put some capital into the financial sector and will look to raise some cash, likely from smaller positions or underperformers.

As for those short position we put on in Wynn Resorts (WYNN) the other day; the stock is now technically breaking down and acting as if there is a bigger problem at the hotel and casino chain. Hence, we are keeping our shorts on.

I was interviewed a few weeks ago by NJTV on the subject of the ABCs of Trading paper that I recently co-authored. The segment finally aired on Wednesday.

Lastly, it’s do-or-die for the Broadway Blueshirts. I see King Henrik shutting down the Bolts 3 – 1 sending the Rangers to their second consecutive Stanley Cup Finals.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was short WYNN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 27, 2015: Market Takes Good News as Bad News

A slew of economic releases indicated that the economy and housing are gaining strength. This resulted in the US Dollar rising, bonds falling in price and rising in yield and stocks getting sold for fear of the FOMC increasing interest rates.

It was classic good news being interpreted as bad news session. It was also, in my opinion, a one-day blunder for which I do not expect any significant follow through to the downside. In fact, it is likely that the markets will rise today.

Last Friday, there was an earthquake that hit the Las Vegas area at around noon. There were no major or even minor damages to the area, except on one major highway. This all occurred right before the three day weekend was going to welcome visitors to the Las Vegas Strip and one hour before the market closed. As a result of what I expected was going to be reluctance on some holiday travelers to come to Las Vegas, we shorted Wynn Resorts (WYNN). The stock was down yesterday, more than the overall market. We are going to stay short as the stock is exhibiting technical weakness.

I am flying east in the afternoon to begin our annual migration to Lake George and will be back with more commentary on Friday.

____________________________________________________________________

My Gut Feeling For Today, May 26, 2015: Don’t Sell in May, Sell in July

Since May 14, over six trading days, the Standard & Poor’s 500 (SPX), has flat lined. That is not necessarily bad news. In fact, we should consider that as good news. With the index hovering near all-time highs, the flat lining allows the market to digest recent gains, in preparation for a further move higher. Also, we are entering a positively biased period of time, the end of May to beginning of June.

Don't Sell in May and Don't Go Away From Stock Markets

By the way, the SPX is up nearly two percent for the month of May. So, as I wrote several years ago in MarketWatch you need to forget the old “sell in May and go away” proverb. I have to tell you; My Gut Feeling is that we continue to head higher until around Independence Day.

Holiday Merger & Acquisition(s)

Already over the long holiday weekend, one merger and acquisition deal was hitting the rumor mills. Charter Communications (CHTR) is apparently making an estimated $55 billion offer for Time Warner Cable (TWC). By the time the market opens on Tuesday that deal could be announced. Recall that Comcast (CMCSA) pulled out of its deal for TWC on anti-trust concerns. CHTR would not face the similar anti-trust issues on the deal as did CMCSA. Don’t be surprised if another deal or two also hit the tape on Tuesday morning.

I did appear on CNBC last Thursday, filming from a remote location in Las Vegas, right around the corner from Rick’s Restorations, for you History Channel fans of its American Restoration show. My CNBC appearance had a panel of market experts discussing McDonald’s (MCD), including Shark Tank’s Mr. Wonderful, Kevin O’Leary.

_________________________________________________________________________________________________

My Gut Feeling For Today, May 21, 2015: Cross Transports Off The Buy List

The markets’ slumber continued till 2PM, when it awoke for the FOMC minutes release. Buyers stepped in at that point but then went back to sleepyville in the last hour. By the closing bell, the major indexes closed a little above or little below their prior day’s close.

In case you care, the FOMC basically took a June rate hike off the table. This is nothing more than what we already expected.

Retail earnings and guidance continue to disappoint, especially in the apparel sector. However, during Wednesday’s session, transportation company stocks got hit with the ugly stick. Now you can add the transportation sector to the do not invest list along with retail stocks. We dumped our transport stocks several weeks ago.

I was approached by CNBC to appear on the Closing Bell show today. The topic will be McDonald’s (MCD). The segment, if I do appear will take place between 3 and 4PM EDST. We own MCD in our Low Volatility / High Dividend Strategy accounts.

While Japanese shares rose to 15 year highs overnight, US futures were looking slightly lower. Unless anything earth shattering happens in Greece, I expect more quiet action until we return next Tuesday from the Memorial Day holiday. I will be back then.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MCD — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 20, 2015: Markets Should Wake Up At 2PM

I had to check my calendar because I thought that Memorial Day was next week. It is, but it seems that many traders decided to take yesterday off anyway. Once we got past the morning’s round of retail earnings, the markets went comatose.

Today should be a bit more interesting, once the FOMC meeting minutes are released at 2PM. It is not that we will learn anything new or different from the minutes. Rather, it is the insatiable need for traders to place bets and react to the minutiae within the transcript that could get the speculative juices flowing again. Before then we will have another series of retail earnings before the market open

Setting aside all of the noise we expect for today, let’s focus on sticking to the script that I outlined yesterday: invest in biotechs, techs and small caps; with an expectation for the markets to rise a few percentage points by the end of the quarter.

Today’s real excitement will be in the evening. First, the Rangers will look to take back home ice advantage in Game 3 of the NHL Stanley Cup Eastern Conference Finals. Then David Letterman’s last Late Show will be broadcasted. Let Go Rangers. Thanks for the memories, Dave.

_________________________________________________________________________________________________

My Gut Feeling For Today, May 19, 2015: Funds Flow Into Biotechs and Small Caps

As I expected, it was, on the surface a quiet trading session. Scant early losses turned into gains across all major indexes, with both the Dow Jones Industrials (DJIA) and Standard & Poor’s 500 (SPX) making new all-time highs.

Below the surface, there were some interesting trends worth noting. The Russell 2000 (RUT) Index was the leader posting a 1.09% advance. Biotech stocks had a strong bid across the board. Retailers posted some snap back gains, but that was put to an end after hours when Urban Outfitters (URBN) declined over 16% in response to its most recent quarterly earnings report. URBN took other retailers down after hours, erasing some of the day’s gains.

Home Depot (HD), TJX (TJX) and Wal*Mart (WMT) all highlight today’s earnings calendar. I am starting to put together a shopping list of retailers and financials that I would buy on further pullbacks. Leading those lists right now are Kohl’s (KSS) and Well Fargo (WFC), but I am far away from making any decision, and other candidates may emerge.

As we are nearly fully invested in our Growth Strategy portfolios, I will have to find a source of cash to buy any retailer or financial services company. My inclination is to trim a little bit of a few winners, but again, I am far away from making any decision.

With several indexes at new highs, I am beginning to form the opinion, a gut feeling, that we are poised for another significant move higher into unchartered territory. With that in mind, don’t be surprised if the SPX rises to 2,200 and the DJIA rises to 19,000 by the end of the quarter.

As for today, once again retail will steal the headlines, but those risk takers will be back buying biotechs, technology, small cap and other risk-on assets and sectors. If you want to put some discretionary funds to work in biotech, take a look at the ALPS Medical Breakthroughs ETF (SBIO), combining both elements of biotech and small cap sectors.

____________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long SBIO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 18, 2015: Retail and Rangers Dominate Day

After a busy weekend driving back and forth to Los Angeles, entertaining and being entertained (included a game a Dodger Stadium) then finishing it off with a late dinner and some $5 blackjack at Sunset Station with an old college friend, knowing full well that today was going to be a slow day; I pushed off writing today’s commentary until the morning.

While I expect a quiet trading session today, despite the S&P 500 (SPX) moving to a new high on Friday, the rest of the week could provide some interesting twists and turns.

Retail, FOMC and Greek Debt Featured This Week

To begin with, the entire week will be inundated with retail earnings. I remain of the opinion that apparel sales will remain weak and home related retailers will be the stars. That being said, we could get some nice washouts and entry points in retail over the coming week(s). As of now, and for several months, the only retail stock we held is Dicks Sporting Goods (DKS). Urban Outfitters (URBN) is the first major retailer to release results this week, later today.

On Wednesday, the FOMC will release the minutes of its most recent meeting. While we know that the FOMC is pushing off any interest rate move till, at the earliest, later this year, revealing what was on the minds of all the voting members can always move markets in the short run.

Then all week, the Greek debt drama will continue as that nation’s leaders go back to the table with European creditors to obtain more concessions and reduce austerity measures.

At least, this week, we will get a break from the same old focus on China, the US Dollar and crude oil.

For me, the most exciting event on the calendar is game 2 of the NHL Eastern Conference Playoffs. Let’s Go Rangers.

______________________________________________________________________________________________

My Gut Feeling For Today, May 13, 2015: Busy Day For Retail But Don't Be a Buyer

As I had expected the markets headed lower at the open yesterday and then some buyers showed up to take us into the green for a short period of time. However, by the closing bell, equity market indices were lower by a fraction of a per cent. For the most part it was a boring session.

Retail Industry to Report Earnings and Sales

Today’s market should be a bit more exciting but not by much. It is retail day. Some retail companies will report first quarter results including Macys (M), Ralph Lauren (RL) and JC Penney (JCP). Meanwhile April retail and crude oil inventories will also be reported.

My general opinion of the retail market, especially for apparel and big box retailers is that there are no investible opportunities worth taking risk on at this juncture. Furthermore, I am quite negative on the real estate market underlying the retail sector, especially shopping mall and retail REITs. Macy’s is one of the few possible exceptions and might be worth taking a position in, if the stock backs off another few points.

Chinese Stimulus Creates Divergent Views

The Chinese markets are starting to get interesting. The government is injecting financial stimulus into the marketplace on the hopes of reinvigorating the economy which has slowed down from peak levels of growth several years ago.

On the one hand, some analysts are stating that the Chinese market is becoming reminiscent of the US tech bubble. On the other hand, others are betting that the Chinese government will achieve what it sets out to do and investors should not fight the stimulus. We still hold positions in three large Chinese internet companies: Baidu (BIDU), Alibaba (BABA) and Tencent (TCHEY), although we cut back on Tencent a few weeks back.

_______________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BABA, BIDU & TCEHY — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 12, 2015: Beware of Bond Yields Backing Up

Yesterday’s session turned out to be a classic textbook trading Monday. The markets opened to the plus side and then were faded all day long, closing at session lows, about ½% in the red for the larger cap S&P 500 (SPX) and NASDAQ 100 (NDX). However, the smaller cap growth Russell 2000 (RUT) closed fractionally in the plus column.

On the other hand, bonds were sold rather hard. The 10-year Us Treasury Note yield rose to 2.27%, a level not seen since last December.

Three Themes to Keep An Eye On

After Friday’s labor report and earnings reports slowing down to a trickle, we have little to trade on, but much to do to position for the next move as investors. Three themes will likely guide us the rest of the week and potentially the rest of the month. First is the US Dollar which seems to be in retreat after its massive rise (nearly 25%) against the Euro (EUR) over the last year. The Greenback was expected to go to parity (one USD to one EUR) versus the EUR but was repelled at $1.05 USD / EUR. This move will hurt commodity process but help US multinational revenues and earnings. Second is the US bond market. It appears that the yield curve is beginning to steepen at the long end ahead of any FOMC interest rate move. This will weigh on the stock market in the short term. Third are mergers and acquisitions. The steepening of the yield curve won’t stop corporations from borrowing at what are still very low rates to fund acquisitions.

Verizon to Buy AOL

Speaking of M&A, we have a deal today. Verizon (VZ) is buying AOL (AOL) for $50/share or $4.4 billion. AOL was one of those companies that I was looking at but did not pull the trigger on. Of course, now it may be too late. However, given the way the market is reacting to the deal announcement, it is pricing in the possibility that a third party might step in for AOL.

Pre-market futures are lower today, as a result of the backing up in interest rates which I mentioned above. We could be setting up for a lower open and turnaround Tuesday where buyers step up later in the morning or afternoon.

__________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long QLD and VZ— although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 11, 2015: Economists Do Not Make Good Investors

It was a busy week for me personally and one for the markets. While I was on the road, the markets got spooked by comments from FOMC Chair Janet Yellen over stock market valuations during an interview with Christine Lagarde of the International Monetary Fund. What spooked traders was her comment that equity market valuations are quite high. However, she went on the say that those valuations are not as high as those for safe assets, i.e. the bond market. Traders, unfortunately, suffer from attention deficit disorder and lack patience.

Recall that Yellen, back in 2014, stated that valuations for small cap and biotech shares were also too high. Traders hit the eject button back then, only to have investors step in and gobble up small cap and biotech stocks. Those sectors have been on tear ever since As I have learned and always preach; economists are good at explaining the past but not at predicting the future. Furthermore, economists, especially at the Federal Reserve, value stocks far differently than finance experts or investors.

After we got through the messy session on Wednesday when Yellen made her comments, the markets went back to focusing on economic data and earnings, the real metrics that drive the markets. This was especially true on Friday after a robust labor report for April. I would also add that the global markets were relieved by UK Conservative Party David Cameron’s landslide victory in the United Kingdom.

Stocks and bonds, which for some time have traded in tandem, have begun to move in opposite directions. Bond prices are falling (as yields rise) while stock prices rise. Whether this is the beginning of the most anticipated bond bear market of all time, I am not sure. However, Yellen was right that bond valuations are riskier than stock valuations.

On the micro level, there were several noteworthy moves for individual stocks. Alibaba (BABA) which has been in the penalty box for several months, reported an excellent quarter. The stock surged from a post-IPO low to a near three month high. Shares of Whole Foods Markets (WFM) which were too expensive, got smacked down after earnings. We used the opportunity to swap out of shares of White Wave Foods (WWAV) into shares of Whole Foods Markets. Disney’s (DIS) Avengers: Age of Ultron continues to rake in huge amounts of money at the box office, now standing at $313 million after playing for two weeks.

As for today, a cut in Chinese interest rates may help to boost shares around the world, but remember that Mondays, in general, are very unpredictable sessions. However, with the S&P 500 (SPX) within ½% of an all-time high, it is a matter of when not if a new high is made, despite what Janet Yellen might think or say.

This week I am speaking at the Money Show in Las Vegas from Monday through Wednesday at Caesar's Palace. Here is my speaking schedule. For those readers in town, I hope you can make it.

___________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BABA, DIS & WFM — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 5, 2015: Tepper and Buffett Still Like Stocks

Friday’s rally extended to Monday. There were several aspects of the advance which you had to like. To begin with, while the Standard & Poor’s 500 (SPX) peaked in the first hour, it managed to stay in the green the entire day and thus the Monday fade that we have become acquainted with never materialized. Second, the US Dollar continues to back off from recent highs, giving multinationals some breathing room on their top line revenues. Third, growth and biotech stocks, market leaders which were smacked down last week advanced as investors scooped up cheap shares. Lastly, Wall Street icons David Tepper and Warren Buffett both spoke positively of the stock market.

Speaking of Warren Buffett, I was interviewed last minute by CNBC, whereby I was asked to comment on some remarks that the Oracle of Omaha gave the last few days. Part of my interview, proudly wearing my Seton Hall shirt, was posted by CNBC on the internet. The other part of the interview discussed interest rates, in which I said that I do not expect rates to move to such an extent to negatively impact stocks till 2017. Furthermore, I pointed out to the shape of the yield curve, which I expect to remain upward sloping; again a positive indicator for stocks.

I was also interviewed by NJTV yesterday on the subject of the ABCs of Trading paper which I coauthored with Jennifer and Jesse Itzkowitz. The interview will be aired today at 6PM. The paper was finally published last week by the Review of Finance. Here is an overview of that paper. I will also be presenting that paper in Las Vegas next week, along with my speech on the Fallacy of the VIX, as well as making other appearances at the Money Show at Caesar’s Palace in Las Vegas next week. Here is my full speaking schedule. I hope to see you there.

McDonald’s released its strategic turnaround plan yesterday. As a long-term MCD follower and stock holder, I was very underwhelmed by this plan. So was the market in general which sent shares lower by 1.7%. At this juncture, the only reason to hold MCD is for its dividend, which we do for our dividend oriented portfolios. I expect activist investors to begin to circle and push MCD hard to make more dramatic changes, including a spin-off of its real estate business.

Disney (DIS) and Kellogg (K) report results today. Disney moved it earnings release to accommodate the funeral of SurveyMonkey CEO, David Goldberg and husband of Facebook (FB) COO Sheryl Sandberg. Goldberg died in an accident while on vacation in Mexico with his family. Our thoughts and prayers go out to the Goldberg family.

I think that buyers are stepping back up for stocks after weak handed traders and holders hit the eject button last week. You always want to be on the side of the strong willed investors as they have both the capital and patience to withstand weeks as we endured at the end of April.

I will be travelling the next two days, first to St Louis to meet with my colleagues at Scottrade and then back home to Henderson, NV but will try to post more commentary at the end of the week.

___________________________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long DIS , MCD & FB — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, May 4, 2015: New York Times in Bloomberg’s Crosshairs

After a bloodbath the last week in April, the markets bounced back on May Day, May 1. There was really no rhyme or reason for the sell-off that last week of April, but it did happen. Small cap, mid cap and growth stocks were hit the hardest. When you get pullbacks in a bull market, they can be sharp, sudden and very disconcerting. Furthermore, they can create opportunities.

Market Sell-off Creates Opportunity

One such opportunity which we availed ourselves of was for shares in Chipotle Mexican Grill (CMG). The restaurant sector was hit particularly hard in April, and CMG was no exception. CMG is a great company but its shares were too expensive. Despite our price target of $735, the shares did not offer a worthwhile risk/reward tradeoff trading in the mid to upper $600s. So, we waited for the stock to pull back to the lower $600s, which it did last week, enabling us to pull the trigger on CMG shares.

This week, April jobs information will be at the forefront of traders’ screens and minds. That will come over a three day period in which ADP will present its jobs report on Wednesday; followed by weekly unemployment claims and the Challenger job cut report on Thursday; topped off by Friday’s Bureau of Labor Statistics jobs report for April.

Is Michael Bloomberg Buying the New York Times?

The week will likely start with another round of mergers and acquisitions, announced or speculated upon. Late Friday rumors circulated that Michael Bloomberg may have an interest in purchasing the New York Times (NYT). I believe that would be a great acquisition and marriage of two strong businesses. Plus, Bloomberg would move the NYT to the political center and be able to reclaim some of its recently lost journalistic independence and integrity.

The Teva (TEVA) – Mylan (MYL) – Perrigo (PRGO) love triangle got more interesting on Wednesday when MYL upped the ante for its proposed PRGO takeover. Next, I expect Teva to juice up its offer for MYL.

There are still many earnings reports yet to be released with several interesting ones on the calendar for this week: Monday – Sysco (SYY) and Berkshire Hathaway (BRK/a; BRK/b); Tuesday – Walt Disney (DIS) and Kellogg (K); Wednesday – Whole Foods (WFM); Thursday – CBS (CBS) and Priceline Group (PCLN).

Also of interest this week is a restaurant IPO – Bojangles (BOJA). It will be tough to get shares in the IPO and I will have to closely monitor the stock in the secondary market.

_______________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long CMG, DIS, MYL & PCLN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 30, 2015: FOMC Makes No Changes

We have an expression in this business: "some days you are the windshield and some days you are the bug". The past few days I have been the bug. Yesterday was downright painful. Despite a strong rally in GoPro (GPRO) which I talked about in yesterday’s commentary, Buffalo Wild Wings (BWLD) which also reported after Tuesday’s close got decapitated. Apple (AAPL), despite its excellent quarter and corporate actions has been in profit taking mode since reporting earnings earlier this week.

Buffalo Wild Wings missed earnings estimates on the back of rising chicken wing prices. If this was the first time that this phenomenon occurred, then I might be a bit worried. However, this is not my first rodeo. I have lived through this company’s battle with wing prices for many years. Each time the company reports a disappointing quarter driven by wing prices, it responds with menu price increases (which are always permanent) and later returns to higher rates of growth.

The Federal Reserve Open Market Committee (FOMC) told us nothing new. Hence, any increase in short term interest rates will not likely occur for a few more months. Bonds remained weak throughout the trading day.

First quarter Gross Domestic Product (GDP) came in disappointing once again. What I think is happening, due to excessive winter weather, are that consumers are hibernating for the wintry first quarter but get more active the final three quarters. So, I would caution against extrapolating GDP for the first quarter into a longer term trend.

While the last few days put a big dent into what was shaping up to be a very good April. I am not going to take any dramatic action and wait till the squall passes. Medium and long term decisions are best not made based on short term conditions.

_____________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, BWLD & GPRO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 29, 2015: Yelling Fire In a Crowded Stock Market

Several years ago we held a position in Hain Celestial (HAIN). Then one day Bear Stearns put out a phony piece of research and spread negative rumors about the company. I don’t recall exactly why they attacked HAIN but I believe it was over accounting or options issues. Anyway, the stock took a tumble, which was likely a purposeful gift for its hedge fund clientele who were short the stock. It was a rough day for me and our clients, but we bought more stock and it wound up being a gift for us. The basis for that report and rumors were unfounded. Eventually the stock rose dramatically, and we sold it out if I recall about two summers ago. Parenthetically, a few months ago, we repurchased that stock for our Restaurant & Food Strategy accounts.

Dubious Research Report

I mention that story because yesterday, an independent research firm issued a rather terse yet scathing report on Endurance International Group (EIGI). In the report, Gotham City Research, stated that the stock will go to $0. Essentially Gotham Research yelled fire in a crowded movie theater, sending the stock down nearly 28% at its worst level of the day. The company later responded to the Gotham Research report by essentially saying that it was “not rooted in reality.” The stock rallied off of its lows and ended down only just over 10% lower for the day. After hours the stock gained back another 1.5%,

Of course, one has to ask, why would major investors such as Warburg Pincus, Goldman Sachs (GS) and Fidelity Investments own large stakes in EIGI if it was indeed a valueless company? Between those three companies, they control about 65% of the company’s stock.

Interestingly enough, a hoard of class action law firms glommed onto the Gotham City Research report and has begun investigations into the company. There is nothing wrong with that and in fact I know and have helped out such firms. My question is, why not sue Gotham Research on behalf of shareholders if the research report is found to not be grounded in fact?

I did not add to our positions in EIGI, despite having some cash from selling the remainder of our position in Magna International (MGA) earlier in the day.

After hours we did get some good news from GoPro (GRPO) which jumped nearly 10% after reporting a strong quarter. That took some of the sting out of the EIGI tumult for the day.

____________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long EIGI, GPRO and HAIN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 28, 2015: China Leads Apple Results Higher

managed to get on the road just after the market closed and got to New Jersey earlier than originally anticipated. Thus, I was able to compose today’s commentary, contrary to what I expected yesterday.

Monday’s market had a typical Monday fade – we opened higher and then sellers stepped up which resulted in the major indexes closing in the red for the session. Biotech stocks got hit with the ugly stick and closed a few percentage points lower.

Mylan Rejects Teva Offer

The Teva (TEVA) – Mylan (MYL) – Perrigo (PRGO) love triangle soap opera aired another episode yesterday. Mylan officially rejected Teva’s unsolicited bid and did a bit of trash talking. In the meantime, Mylan continues to press its bid for Perrigo. The next salvo will likely come from Teva which should sweeten its bid for Mylan from the current offer of $82/share. I think that the next level is $90.

China Sales Boost Apple Results

As expected Apple (AAPL) reported results for the March quarter after the market closed. The company reported earnings per share of $2.33 on revenues of $58 billion, both better than expected. IPhone unit sales jumped 40 percent to 61.2 million versus estimates of 58.1 million units, China sales jumped from $9.7 billion to $16.8 billion. That is just a spit in the ocean as sales in that nation are in its early stages. Gross margins of 40.8% surpassed the higher end of guidance by 130 basis points. The company’s market share of computer sales rose as Mac sales rose 10% versus an industrywide decline. The only weak aspect of the quarter was declining iPad shipments. As for the iWatch, some subjective throwaway comments were made as to sales but no metrics were provided. The company’s board raised the quarterly dividend from 47 cents to 52 cents and increased its share repurchase plan by $50 billion. After rising $2.37 to $132.65 in the regular session, shares of AAPL tacked on another $1.77 after-hours. Should the after-hours price hold; it would mark a new all-time high for AAPL shares. I am maintaining my year-end price target of $150, so it is not too late to own Apple.

Despite the City of Baltimore burning down, the riots in that city will not impact today's market. Certainly, Apple's results and board news will have a positive influence on the markets. I expect a lower open and then buyers will step up and make it a turnaround Tuesday.

_____________________________________________________________________

My Gut Feeling For Today, April 27, 2015: The Apple of Everyone’s Eye

As expected, tech company shares went on to rally Friday, after a string of earnings reports on Thursday afternoon. The only glaring exception was the semiconductor subgroup which, as represented by the PHLX Semiconductor Index (SOX), traded significantly lower by 1.66%. Despite the semis comprising a significant amount of the technology sector, the stocks tend to trade to the beat of a different drummer. Yet, if you are going to make a field bet in the tech sector, you should have some semi exposure, which we do.During the Friday session, we moved capital from the energy sector to the cloud computing space.

Apple Will Tell Us About iWatch Orders

The headline act today, and for the quarter, is Apple’s (AAPL) earnings report after the market close. Most people will reflect upon the earnings per share results compared to expectations of $2.16 versus $1.66 a year ago; and, actual sales compared to consensus sales estimates of $58.06 billion versus $45.65 billion year ago. Gross margins will also be closely followed versus company guidance of 38.5% to 39.5%. Of greater importance are the metrics that could move the stock, namely, iPhone sales and iWatch orders. In the December quarter, Apple sold 74.5 million iPhone units. While iWatch orders did not take place till the second quarter, Wall Street will be fixated on how orders have progressed so far.

While many major indexes are trading at or near all-time highs, in advance of the Apple event, I am expecting a quiet session. There is a good chance that we could wake up to some more merger and acquisition news to create some pre-Apple excitement. The markets are in unchartered territory, giving bears ample fodder to call for a bubble. They need a market tumble because they have been feeling pain for so long. Don’t fall for their bravado as I expect the equity market to trade further into outer space in the coming months.

I am going to be travelling late Monday into early Tuesday and will be back on Wednesday with my thoughts on the Apple quarter and more commentary.

______________________________________________________________________

My Gut Feeling For Today, April 24, 2015: Finally, Its Tech’s Turn

Yesterday afternoon, on what was perhaps the busiest earnings day of the season, some of the largest technology companies in the world, save Apple (AAPL), reported superlative returns. Those companies: Google (GOOGL), Microsoft (MSFT) and Amazon.com (AMZN) rose sharply after hours and will likely spark a tech rally.

What all of those companies have in common is the revolution in cloud computing. I have to admit, that I was too early to the cloud party having held Juniper (JNPR) and Red Hat (RHT) last year, only to find those stocks disappoint. We have held Google for several years and to that extent have benefitted. I am not going to miss the next leg up in the cloud sub-sector and will likely put more capital to work.

Also reporting results after the market close on Thursday was Starbucks (SBUX) which we own in our food and restaurant strategy accounts. That stock also rocketed higher after hours.

Starbucks, like the aforementioned tech troika are all members of the tech heavy Nasdaq 100 (NDX) index. So, expect a rally in that sector today. We hold the Pro Shares Ultra QQQ (QLD) as a portfolio overlay.

It’s Not 1999 or 2008 Again

It has been a while since tech and growth stocks have been leaders. One big reason is skepticism after the 1999/2000 tech crash and 2009/09 fiscal crisis. Conditions now are unlike that of those two periods Technology valuations are significantly lower now than the 1990s and the economy is in better shape than 2008. Another reason has been the market’s love affair with value, dividends and yield.

The energy sector is a disaster. Transportations are exhibiting signs of topping out. Utilities, the definitive dividend sector is in profit taking mode. Capital is coming out of those sectors, which are not growth oriented, and are heading to technology. If you have not already done so, exit the underperforming sectors and move more capital to technology.

_______________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, GOOGL, SBUX & QLD — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 22, 2015: Mylan: The Gift That Keeps on Giving

After Monday’s surge, the markets were rather static but lower for Tuesday’s session. The exception was the NASDAQ 100 (NDX) which rose 0.42%, again pointing to the relative strength in tech and biotech stocks.

Generic Drugs Are All the Rage

I mentioned yesterday that Mylan was playing down rumors of a takeover by Teva Pharmaceuticals (TEVA). That was tantamount to an open invitation for TEVA to make an unsolicited bid for MYL. Indeed TEVA made an $82 per share offer, half in stock and half in cash.

A few months ago MYL bought a generic drug business from Abbott Lab (ABT) in a structured deal that created a new offshore Mylan in which both Abbott Lab shareholders and then existing Mylan shareholders each took ownership of. As a result, a new Mylan was created, triggering capital gains for old Mylan shareholders.

Then two weeks ago, the new Mylan agreed to purchase Perrigo (PRGO) for $31.3 billion in stock and assumed debt. On the announcement, stocks of both the acquirer, MYL and the target, PRGO rose. At the time, MYL was one of our five largest holdings in our Growth Strategy portfolios. We shaved off about 30% of MYL on that day. The stock subsequently backed off; that is until the TEVA announcement.

The TEVA announcement resulted in MYL shares surging to a new high, closing at $74.07. Despite selling off 30% of our positions earlier this month, it now stands as our 11th largest holding in the Growth Strategy portfolios.

So where does the TEVA / MYL deal go from here? After the market close, PRGO decided to reject MYL takeover offer. MYL already rebuffed TEVA before the unsolicited deal was announced. So for now we are going to have a financial ménage à trois play out. We can expect a series of higher offers to roll out over the next few weeks. Also don’t be surprised if a fourth player comes in to throw even more cash and stock at one or more of the players in the current set of proposed deals. One thing I am sure of is that the price of poker will rise and you want to hold these companies’ stocks.

Facebook Heads Earnings Reports Today

After the market closed, earnings were mixed for a broad range of companies. On balance though, companies continued to better expectations but were getting sold on the news. Today another 31 companies in the S&P 500 (SPX) will report results with the spotlight on Facebook’s (FB) results after the market close. Facebook is now one of out top ten holdings in our Growth Strategy portfolios.

______________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long FB, MYL and QLD — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 21, 2015: Cockroaches Run For Cover

For a few days, the lights were turned off in the equity markets after what seemed like exhaustive tax related liquidations and fears of a Grexit. Then the lights were turned back on yesterday and the cockroaches (stock market bears) which were swarming over the markets for a few days ran and hid. The good news is that the markets rallied such that the Standard & Poor’s 500 (SPX) is now within one percent of its all-time high. The bad news is that the cockroaches were not eradicated and they are certain to come back out of the shadows to cause damage once again.

Royal Caribbean is Cheap

Royal Caribbean (RCL), one of our long term holdings, reported better than expected earnings of 20 cents versus consensus estimates of 14 cents. However, the company also lowered its full year 2015 guidance by twenty cents on each end of the range of expectations to a new range of $4.45 - $4.65. The reasons cited for the reduced guidance were increasing fuel prices and currency fluctuations. This guidance could be a classic UPOD (under promise over deliver). Even at the lower end of the range, the company will grow its bottom line by 31% this year. Selling at 16 times current year’s earnings (at the low end of the guided range), the stock is selling at 0.52 PEG (price earnings to growth ratio), It is not often that you can find a well-managed fast growing company at a PEG below 1.0, let alone the level at which RCL sells for. In other words, yesterday’s decline of 8% only makes a cheap stock that much cheaper.

Despite rumors that Teva Pharmaceuticals (TEVA) would purchase Mylan (MYL), Mylan plans to proceed with its purchase of Perrigo (PRGO) and said that a TEVA acquisition would likely not pass anti-trust approval, throwing a damp towel on takeover speculation.

33 S&P 500 Companies Will Report Today

Earnings reports pick up a little more speed today in what is the busiest week for the season. Thirty-three (33) stocks in the SPX will report results today, several of which we hold in client or personal accounts. Two that we don’t own but would consider for purchase are Intuitive Surgical (ISRG) and Under Armour (UA). However, both are a little too rich for me at current levels yet never give you a better price to get an entry point.

______________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long RCL and MYL — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 20, 2015: Don’t Fall For Grexit Freakout

The market took a tumble on Friday as fear of a Greek exit from the Euro and Eurozone, coupled with its likely debt default, put pressure on stocks around the globe. Concerns about slowing growth in China only served to pour some gasoline on the fire.

I have to say, a Greek exit from the Euro would be a positive for Europe and Greece, not a negative. Should that exit occur, Greece would likely reissue the drachma as its currency and then the nation could reschedule its debt in a Brandy Bonds fashion. The drachma would be very weak versus the Euro and other major currencies. This would generate dramatic increases in foreign direct investment into Greece resulting in job creation which is greatly needed there.

The Grexit Freakout was likely a one-day blunder and I expect stocks to rebound today. Furthermore, April options expiration might have contributed to the heavy losses on Friday, which should reverse on Monday. Let’s not lose focus on what should really drive market direction at home – earnings. So far, with only 59 of the Standard & Poor’s 500 (SPX) reporting, bottom line earrings per shares are tracking much better than expected, while top line sales are a little worse than expected, likely due to the strong US Dollar. Use Grexit sell-offs to add to positions and not sell into any panic.

_________________________________________________________________________________________________________

My Gut Feeling For Today, April 15, 2015: Tax Related Selling Is Over

It was hard to stay awake yesterday unless you consumed some sort of chemical stimulant. That is unless you had to deal with taxes. Believe it or not, taxes did play a big role in Tuesday’s session.

Tax Selling Put Pressure on Market

From my perspective, I continued to get calls and queries from clients and their accountants who needed assistance with tax matters. As taxes become more complex, tax planning by individuals get pushed off and are subject to last minute tax payments being made. The markets felt these phenomena. Weakness in the Monday and Tuesday sessions were likely due to individuals selling shares, most of which were recent winners, to fund their last minute tax payments. By the end of Tuesday’s trading, the selling seemed to have abated and the major averages closed in the green across the board.

Helping today’s action will be the positive reaction to Intel’s (INTC) earnings. This comes on top of better than expected results from JP Morgan Chase (JPM) and Wells Fargo (WFC) which, are spending less money to combat government investigations and law suits.

Take Under in Technology

This morning we wake up to a flashback from the 1990s as Nokia (NOK) is purchasing Alcatel-Lucent (ALU). This deal is getting met with the Bronx cheer as shares of ALU are down in the pre-market. The deal is valued at $16.6 billion or 0.55 shares of NOK for every ALU. With NOK selling at $8.00, the ALU stock is worth $4.40. However, ALU closed at $4.93 yesterday, making this a take under.

Today’s calendar is busy with earnings and economic events. The ECB meeting and interest rate decision is scheduled as is the release of the Fed’s Beige Book. Bank of America (BAC), Cypress Semi (CY), Delta Airlines (DAL) and SanDisk (SNDK) all head the earnings calendar.

We appear headed to a stronger market open on the back of Intel’s results. Should the pre-open earnings releases beat expectations and the the tax related selling dry up, the market’s march higher will pick up once again.

To commemorate Tax Day, I suggest watching one of my favorite Marx Brothers clips.

_____________________________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long CY and DAL — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 14, 2015: Mergers and Acquisitions Benefit From Cheap Debt

It was a rather lethargic session yesterday, resulting from the lack of economic or earnings news. Tech and biotech were outperformers, with the former down less than the overall market and the latter advancing. To reiterate what I have been advocating, these are the sectors that will lead us higher and are attracting investor attention. There was hardly any commentary on Apple (AAPL) iWatch orders other than a few passive comments estimating orders in the range of 1 to 1.25 million units. My good friend and colleague Cody Willard had some interesting thoughts on Scutify yesterday comparing iWatch orders to the debut of the iPhone and iPad.

Big Deals Are Coming

What is beginning to heat up are mergers and acquisitions, and not the garden variety type. We are seeing some huge deals taking place. Whether it’s Mylan (MYL) buying Perrigo (PRGO) for nearly $29 billion, or General Electric’s (GE) sale of its financing unit for $27 billion, deals are getting bigger than ever.

Helping to fuel these deals are cheap financing rates and the insatiable appetite for US Dollar denominated debt securities from buyers of all sorts, domestically and internationally. Interestingly, what fueled the 1980s M&A boom was the junk (high yield) bond market controlled by Drexel Burnham Lambert and its senior executive, Michael Milken. Now low interest rate debt availability will achieve the same ends.

One fair bit of advice; trying to guess what stock is going to get taken over is pretty much a fool’s game. The reason is that if you are wrong, you could be stuck with stock that goes nowhere. You are best off buying cheap stocks with growth potential and eventually they will be recognized by a potential buyer. On average, I have at least one stock taken over a year. Think of it as having a potential lottery ticket in any stock that you own.

Earnings Get Interesting Today

Earning season starts to get interesting today. Intel (INTC), JP Morgan Chase (JPM), Wells Fargo (WFM), Johnson & Johnson (JNJ) and CSX (CSX) all report results. Retail sales for March will also be released before the market opens. Recall my themes for 1q15 earnings season. Nap time is over for the markets as prime time is about to begin.

___________________________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long GE and MYL — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 13, 2015: Global Investors Are Back In Love With Stocks

My Thursday evening was a bit topsy turvy and I could not get my commentary out for Friday. However, Thursday was a positive but quiet session with no real news to report. Friday was spent looking at the masses waiting to order an Apple (AAPL) iWatch with techs leading the market higher. I suspect that today, we will get the Monday morning quarterbacking by the media and analysts as to how exit polls from Apple stores and online activity predict iWatch orders.

Investors Are Drawn to Stocks

The S&P 500 (SPX) is now on a three day winning streak and now stands within one percent, 0.73% to be exact, of its all-time high set in early March. Not to be outdone, the Hong Kong Hang Seng and Euro Stoxx 50 (SX5E) indexes are trading at all-time highs. Global investors are beginning to fall in love again with stocks, albeit seemingly begrudgingly. In the meantime, traders and hedge funds are shorting stocks at record levels not seen since the 2011 European debt crisis and the 2008-09 global financial crises. The only difference is that now, there are no externalities to warrant such activity. Hence, it seems more speculative than substantive.

We survived the big Hillary Clinton announcement, which was as surprising as Barry Bonds using performance enhancing drugs. Next on the hit parade is Marco Rubio who will decide if he runs for POTUS or reelection to the US Senate.

Biotechs and US Dollar Back on Top

Today the earnings calendar is quiet and the economic calendar is empty. The attention will be on the US Dollar which is starting to gather steam again and the aforementioned iWatch sales. Biotechs are also heating up once again after experiencing a pullback the past few weeks. The more you hear about a biotech bubble, the less likely we are experiencing one. My favorite play in the sector is a small cap biotech ETF, the ALPS Medical Breakthrough (SBIO). Fair warning, this ETF has only $55 million in assets and can be quite volatile.

________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL and SBIO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 8, 2015: Five Themes For 1q15 Earnings

For most of the day the markets extended Monday’s gains. However, volume and spirit was lacking and by the end of the session, the major indexes were fractionally lower. There was nothing to report other than Ran Paul’s Presidential candidacy announcement, which on a slow news day garnered much of the media’s attention.

I deployed some cash yesterday both for our Dividend capture Buy/Write and the Low Volatility / High Dividend Strategies. I can provide more information for both these strategies on request. Otherwise, I let the bore fest just play itself out.

Today marks the official beginning of first quarter earnings season as Alcoa (AA), Bed Bath & Beyond (BBBY), Family Dollar (FDO) and Pier One (PIR) all report results. At 2PM the Federal Reserve will release the minutes from the most recent FOMC meeting, which should provide some entertainment value for traders.

There is an old adage not to short a boring market. A corollary would be to be a buyer when the markets are boring. I think we could see buyers come into the market over the next few days, so you want to be prepared.

Let’s also be prepared for earnings season. There are a few themes which should resonate across corporate America:

Revenues will be adversely impacted by the strong US Dollar. This will hurt multinationals. However, companies with a domestic focus will remain unscathed by this phenomenon
Expect companies to cut back on staff. This is due to rising benefits and minimum wage costs. It will also be a mechanism to offset revenue loss from the strong US Dollar
Discretionary consumer spending with be better than expected
Bottom line misses will be attributed to the wintry weather
Buybacks and dividend will escalate

Tomorrow I am going to have to skip a day from publishing My Gut Feeling but will be back on Friday.

______________________________________________________________________

My Gut Feeling For Today, April 7, 2015: Buyers Slam Dunk Bears

As I had expected, the over-the-weekend-premarket futures market which indicated a strong sell-off, bottomed at the open and rallied the rest of the session. Some might attribute it to commentary by a Fed official. I just think that it was sloppy futures selling by hedge funds who extrapolated the disappointing jobs report into another recession. Boy was that a bad inbounds pass by the bears.

Thanks to Friday’s weak labor report, Fear of Fed was taken off the table, bonds rallied as did dividend stocks. Small cap stocks underperformed the market. It was likely a one-day event as larger cap stocks caught up on lost ground in the first quarter.

I only performed one meaningful client transaction during Monday’s session. That took place in our Restaurant & Food Chain Portfolio accounts. We booked profits in Agrium (AGU) and started positions in the evil Monsanto (MON). Hands down, Monsanto is the most hated company in the world. That it is so hated; is not for financial reasons but for social ones, by those who are against GMOs (genetically modified organisms).

Today should be a rather dull session. There are no newsworthy economic or earnings reports on the calendar. Earnings season will commence on Wednesday. I think we will go back to watching the Dollar and crude oil for direction for the day. Likely, by the end of the day, the markets will extend Monday’s gains but to a lesser extent. After all, following Monday’s exciting NCAA men’s basketball championship game, we could use a day of rest or celebration, depending on who you rooted for.

_________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MON — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, April 6, 2015: Jobs Report Casts Shadow Over Economic Growth

I took the last two trading days off from writing, but not from working, to concentrate my after hours’ efforts on helping my wife prepare for the Passover holiday. Two vats of chicken soup, fifty matzoh balls and three briskets later we began the holiday at sunset on Friday.

However, on Friday morning the markets got a dose of economic data from the Bureau of Labor Statistics. In March, the American economy generated 126,000 jobs, far short of the 245,000 jobs expected by economists. Furthermore, the prior two month’s jobs growth was cut back by an aggregate 69,000.

So what happened in March and does this report portend a slowing of the economy? When you dig into the details, you get a somewhat clear picture of what occurred.

Mining and extractive services jobs, i.e. oil and gas, declined by 11,000 in March. The industry has lost 30,000 jobs thus far in 2015, after adding 41,000 jobs in 2014. This should not have come as a surprise to economists, but then again they work off of models, not the real world. Frankly, losing only 11,000 jobs in this sector was far fewer than what I would have expected given the condition of the crude oil market.

Employment in food services and drinking places changed a measly 9,000 in March, versus a 66,000 increase in the February. Job growth in the first quarter of 2015 averaged 33,000 per month, the same as the average monthly gain in 2014. Employment in other major industries, including construction, manufacturing, wholesale trade, transportation and warehousing, information, financial activities, and government, showed little change over the month. Given the weather this winter, which was no better than that of last winter, why should we have expected anything different year-over-year?

Let me also throw two other possible sources of slowing job growth. First, strength in the US Dollar is hurting our exports, which is not helping create jobs at home. Instead, we are creating jobs abroad as the strong dollar chases cheap foreign made goods. Second, increases in minimum wages are beginning to have a second order effect on jobs. Nineteen states increased minimum wages on January 1, 2015, after two states did so on December 31, 2014. Two other states and the District of Columbia are scheduled to increase minimum wage rates later this year. WalMart (WMT), McDonald’s (MCD), Target (TGT), TJ Max (RTJX) and Gap Stores (GPS) all recently announced that they would voluntarily raise their minimum pay scale. In doing so, these companies have three courses of action, 1) raise prices to consumers; 2) cut headcount, or; 3) do nothing. The first is not likely, the last would hurt earnings, hence the second – cut headcount, is the likely response from management. This is something that employers warned would occur if minimum wages rose.

So, since the markets were closed on Friday, expect the stock market to open lower today on the disappointing labor report. Also, expect the fixed income markets to rally as the jobs report will convince many investors and traders that the Federal Reserve will delay even longer their first rate increase in several years.

That being said, My Gut Feeling is that the equity markets open on their lows in the first hour and then snap back. I have some cash to put to work and might do so later this morning.

___________________________________________________________________________

My Gut Feeling For Today, March 31, 2015: Healthcare and Pharmaceutical Takeovers Spark Rally

Last week’s market sell-off is just a faded memory as three acquisitions in the healthcare and pharmaceuticals sectors ignited a strong Monday rally. Those tech and biotech stocks hated so much last week were in favor with traders and investors today. Helping out the bulls was a strong bias that I was expecting for the end of the quarter. While today could also have a positive bias, I don’t expect a bullish move of yesterday’s magnitude.

One group that is not getting much love this year is the semiconductors. Despite a nearly 3.5% rise in the NASDAQ 100 (NDX) in the first quarter, the popular semiconductor ETF, Market Vectors Semiconductors (SMH) is only up 2.3%. That ETF’s largest constituent, Intel (INTC) is suffering from a 13.3% decline so far this year. I believe that there are opportunities in the sector and am researching what semiconductor company we would like to purchase with our cash position.

There are two quick administrative notes for our clients and investors in general:

You might have noticed that shares in Nathan’s Famous (NATH) dropped considerably on Monday; by $21.86 to be exact. Don’t worry, investors received $25.00 per share in a special cash dividend, more than offsetting Monday’s stock decline.
K1s for publically traded limited partnerships such as Master Limited Partnerships (MLP) and development companies are still being sent out. Of course, these reports are necessary to file tax returns. The holdup is at the corporate and state tax levels. You can wait for the K1s to be received; try to obtain them yourself at websites such as https://www.taxpackagesupport.com/(S(liclvt33q2joc0beiorqb5nb))/k1SupportHome.aspx or; play it safe and file for a tax extension.

___________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long NATH & QLD — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 30, 2015: Sticking to Energy Mid and Down Streams

Last Wednesday’s sell-off was followed up by stabilization on Thursday and a small advance on Friday. In other words, there was no follow through and we can categorize Wednesday’s session as another one-day blunder.

After an exhaustive week, we could use some rest. That however, is not going to occur so soon. Today, being the penultimate trading day of a quarter can get quite busy, as will tomorrow’s first quarter finale. Wednesday we begin a new quarter and then end a short week on Thursday as Friday is a stock market holiday, to mark Good Friday. Friday is also the beginning of the observance of Passover. As it turns out, the March jobs report will get reported on Friday as Jews burn chametz (leaved bread) and Christians head to church. So, at least we will have the weekend to absorb the labor report.

I mentioned last week that we booked some small gains in the SPDR Energy Select ETF (XLE). However, we did not jettison our holdings in the Kayne Anderson Energy Total Return Fund (KYE) which goes ex-dividend on Wednesday. Furthermore we kept positions in Marathon Petroleum (MPC). The reason for selling the former but keeping the rest is that the XLE is engaged primarily in the upstream segments – exploration and production – which is more sensitive to crude oil prices, whereas the other stocks are engaged in midstream and downstream activities, which I prefer to hold. The recent rebound in crude oil prices has likely ended.

On Friday I entered some orders to increase our positions in the biotech sector as we are getting better prices after last week’s sell-off in the sector. Besides that, I will likely be sitting on my hands from a transactional perspective for the next several days and let the machinations of the marketplace play out. Still, I expect a positive bias to the markets over the next several trading sessions.

____________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long KYE & MPC — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 26, 2015: A Good Old Fashioned Shellacking

The sellers showed up at the open and rained some intensive selling upon the market for the entire session. Getting hurt the most were this year’s winners – tech and biotech stocks. Oil and oil stocks got a boost. Make no mistake about it, there were wounds inflicted to portfolios but not enough to check into the emergency room.

Back in January we took a starter position in SPDR Energy Select ETF shares (XLE). It just looks like oil prices want to remain lower for an extended period, despite the short term rally in the sector. Hence, with the little pop in the (ETF) stock today we took the opportunity to cash out. We will collect a dividend from our holding and made a little in the trade. At a later date, we will revisit the energy patch but for now, despite the tech wreck today, I prefer the tech and growth sectors at this juncture.

That deal for Kraft (KRFT) materialized today. It hit many people by surprise. Two companies KRFT and HJ Heinz (owned by Brazilian company 3G and Berkshire Hathaway (BRK/a, BRK/b) engaged in a convoluted merger. KRFT shareholders will own 49% of the new company which will be public and in addition, receive a $10 billion ($16.5 per share) special dividend payment. This sounds like both an overpriced deal as well as a unique and crafty piece of financial engineering on the part of 3G and Warren Buffett. I was quoted by USA Today as I just opined. With combined estimated annual revenues of $28 billion, the merged company is priced at approximately 2.85 times sales once you adjust for the special dividend. Compare that to General Mills (GIS) which sells at 1.8 times revenues and Conagra (CAG) which sells for about 0.93 times sales.

The question one has to ask after a day like yesterday is whether the selling has legs. I think that part of the selling was influenced by the end of the quarter. Buyers conspicuously stepped aside to let the sellers do their damage. Wednesday’s action has all the earmarks of a one-day blunder rather than the beginning of a more protracted correction.

_______________________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long GIS — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 25, 2015: It Was a Day For Foodies

For the third consecutive trading day, sellers emerged late in the session to take stocks lower into the close. I am not seeing any real conviction by the sellers. It seems like weak handed renters are selling stocks. Nor, am I seeing any aggressive actions by buyers who are just playing it safe into the quarter end and are likely holding dry power for the beginning of April, next Wednesday. The US Dollar gained a little ground, likely keeping stocks in check.

Sonic (SONC) reported strong results as CEO Clifford Hudson continues to turn the company around, both operationally and fiscally. It is one of those stocks that I was too pessimistic on given its not so stellar past. I am going to have to reevaluate the company, consciously removing any prior bias I might have been harboring. McDonald’s (MCD) also continues to gain ground on speculation that the company could split into two companies, a REIT and an operating company. This is not new speculation and something that I have written about in my newsletter and in internet publications as well as talked about on television and radio for some time now. The likelihood of that happening is not that great, but the more it gets bantered about, the more that value investors will flock to the stock.

After the market closed, it was revealed that Kraft (KRFT) is in advanced talks to be bought out by Brazilian private equity firm, 3G Capital. If you recall, 3G Capital teamed up with Warren Buffett's Bershire Hathaway (BRK/a BRK/b) to buy HJ Heinz a few years ago. The deal is expected to flow through 3G's Heinz unit. It is not known if Buffett is at the bargaining table for Kraft as well but as Heinz is involved, he likely has a say. To me, this only shows that the value of smaller more healthy brands such as White Wave (WWAV) and Hain Celestial (HAIN) are being overlooked but will someday draw private equity attention. (Note to my friends in the newsrooms: I am available today to talk about the potential deal).

The earnings calendar has a bunch of smaller companies reporting such as Five Below (FIVE), Paychex (PAYX), PVH (PVH) and Red Hat (RHT), none of which really get me excited these days. It is the day’s economic calendar which could stir things up as durable goods and crude oil inventories are reported.

I am still taking a sit back and watch approach as the end of the quarter plays out. There is no compelling reason to do otherwise right now.

______________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long MCD, HAIN and WWAV — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 24, 2015: Sailing Away

For most of the session the markets stayed in the green, partially reversing the Friday expiration drop. Then once again at the end of the day, sellers showed up to close most indexes in the red, albeit slightly. I would not draw any strong conclusions as to why the late selling hit the tape the past two sessions. Sometimes it just happens.

We made some minor changes to our Food & Restaurant Portfolios, selling Aramark (ARMK) and buying Norwegian Cruise Lines (NCLH). We already held NCLH in our Growth Strategy Portfolio. The stock acts as an overlay to our long term holding in Royal Caribbean (RCL) in both portfolios .

Today Sonic Corporation (SONC), the red hot restaurant company is scheduled to report earnings after the close and is the only interesting earnings report on the calendar. Economic data – CPI and new home sales are going to be a bit more stimulating to the brain and given the lull in news, could be market movers.

Ted Cruz broke the ice and became the first official person to announce their candidacy for the 2016 Presidential election. It is a long road to the election and he was hardly the most anticipated candidate to throw their hat into the ring. The world is waiting for Hillary Clinton to finally announce her candidacy. I might get a better feel for what is on her mind this weekend when I will be surrounded by some Hillary supporters.

There are six more trading days to the quarter. I would expect much of the same action as the past two sessions. I would not rule out however, the S&P 500 (SPX) making another run at a new high before the quarter is over. In order to do so, it would have to rise about 15 index points or about 0.7% which is quite possible.

_______________________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long RCL & NCLH — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 23, 2015: Tsipras Meet His Merkel

Friday’s market action was bifurcated. For most of the session the growth trade was back on. Then in the final hour, the derivative expiration effect took hold and sellers came into the market. What typically happens is that the impact of expiration from the previous Friday session gets a mirror image trade on the following Monday. In other words, we should expect a positive open to the markets today. That is of course absent any other extraneous news which traders use to throw a monkey wrench into the day’s trade.

It appears that the strong dollar trade, at least for now has peaked. If the reversal in the dollar continues, we could see a sustainable rebound in oil prices. That rebound will be one to sell into, in my opinion.

We are now in the homestretch for the quarter. Just as a college basketball team ahead by four points will eat up the clock in the final minute, expect that institutional money managers will be doing the same with stocks in the next week. There will be a supportive bid to the market but don’t expect anyone to take any chances. The week’s calendar is rather mundane, so it will be the dollar, oil and Europe that continue to be a guiding hand for traders.

Greek Prime Minister Alexis Tsipras is heading to Germany today to have a sit down with Angela Merkel. Expect that the socialist from Greece will face strong Teutonic demand for economic reforms. The average German worker is not happy with throwing more Euros at what they consider a Hedonistic society. Merkel for the most part speaks for the rest of Europe, so Tsipras will have to learn to compromise or suffer repercussions at home and in Europe.

_________________________________________________________________________________________________________________________________________

My Gut Feeling For Today, March 19, 2015: Patience Turns to eBULLience

Gone from the FOMC diaries is the word “patience.” In her press conference, Janet Yellen did say that the FOMC was not going to be impatient as well. A rate rise for the April meeting was ruled out but the FOMC hinted that the June meeting could result in a tightening. In other words, we won’t have to deal with the “will she or won’t she” foolishness for another three months.

As is usual, the hedge funds and day traders tried to front run the announcement and sold the market down. Instead they would up being taken out in stretchers as the S&P 500 (SPX) rose about 1.86% from its low at around 2PM and ended up 1.22% for the day. Oil and bonds followed stocks while the US Dollar got sold. All is right in the land of stocks.

All is right in the land of milk and honey (Israel) as Benjamin Netanyahu was victorious in the Israeli elections. He should be able to put together a new coalition government in short order. Not only did he win the Israeli electorate, he also won over the American electorate. I will postulate that Netanyahu will help drive Jewish American voters to the Republicans come 2016. Certainly, the White House is doing their best to drive them away from the Democrats. Our long-term holding in the Israeli market, Aberdeen Israel Fund (ISL), rose nearly 2% for the day.

As the quarter heads into the home stretch, and the FOMC decision is now behind us, the only remaining event for the quarter of significance is Friday’s quarterly derivative expiration. I expect the market to gravitate higher through the end of the quarter. With the FOMC on hold for at least another three months, all boats should rise – growth and dividend stocks – in the near future.

I sold shares of Harley Davidson (HOG), not because I lost patience with the stock but there are some warning signs that the company is having issues at home and abroad. As a result, I believe that earnings estimates are too high, will have to be lowered and downgrades are likely to ensue. With the proceeds of the sales, I added to our position in ALPS Medical Breakthroughs ETF (SBIO) and started a new consumer discretionary / hospitality position.

Today marks Apple’s (AAPL) inclusion into the Dow Jones Industrials (DJIA). It should not have material impact on the stock but will certainly be a point of interest for the financial media on what should otherwise be a slow news day. Overall, I expect positive follow through to Wednesday’s advance.

____________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, ISL & SBIO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 18, 2015: It’s a Matter of Patience

At 2PM the FOMC will release a carefully worded statement delineating the monetary policy for the country over the next six or so weeks. While every sentence, phrase and nuance of the statement will be scrutinized, there is one word or lack thereof which will be in everyone’s crosshairs: Patience.

The FOMC has in the recent past stated that: “the Committee judges that it can be patient in beginning to normalize the stance of monetary policy.” Today, the world’s markets will be sitting on the edge of their seats waiting to see if the FOMC remains patient or substitutes that phrase with some other wording, which may tip the FOMC’s hand as to when we should expect that target rates will be raised. The lead up to today’s monetary event would give you the impression that the fate of the civilized rests in that one word. I am happy to say that it does not.

No matter what linguistic technique is utilized by the FOMC, rest assured that there will be plenty of volatility leading up to and after the statement release and Janet Yellen’s press conference.

Patience is certainly important in investing. We bought Nathan’s Famous (NATH) several years ago. The stock was stuck in an endless range of $50 - $60, until last year, when finally it broke out and now trades in the $70s. Another example is Opko Health (OPK). That stock was stuck in an $8 - $9 range for years before breaking out this January and closing at $14.66 yesterday. If you had patience as did I, you would have been paid off handsomely.

Now people ask me about Alibaba (BABA), to which I say, have some patience.

____________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BABA, NATH & OPK — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 17, 2015: Japan Likes US Rates Just As They Are

Not long after you likely read yesterday’s My Gut Feeling, USA Today published an article on the decay of American malls and anchor stores. What I failed to mention yesterday as another threat to the malls are the rapid expansion of outlet shopping centers. As I write, my wife and son are at one in Las Vegas.

The Japanese are stepping up their purchases of US Treasury Bonds. This means that they are not cringing from the fear of rising interest rates in the states. Rather than waiting for Wednesday for the FOMC to tell us that they will remain patient and not raise rates, as I have been expecting, the financial markets front ran the FOMC, and clocked the US Dollar. Yet we will still have to endure the Tuesday-Wednesday FOMC Kabuki Theater. I can actually use that term because I have seen several Kabuki Theatre shows while living in Japan. I will take Broadway any day of the week over Kabuki, but I digress. With the market now expecting the FOMC to remain on hold, the Fear of Fed trade faded, the US Dollar got sold and US stocks were bought.

Focus On the Longer Term Not The Next Day

While I compose My Gut Feeling For Today on a daily basis, readers have come to understand that I don’t invest day to day or roll the dice for the next minor event. Rather, I look ahead to financial trends, market conditions and economics to formulate an investment theme for which I will then determine micro and macro strategies. Unfortunately, most of the trigger finger happy traders and schizophrenic hedge funds managers who feel compelled to constantly transact, can’t think past 4PM on any given day. Hence, these actors can create the seemingly day to day randomness and volatility in the market, but beyond that they have little or no long term impact on the markets. What really controls the long term direction of the market is the manner in which large institutions, pension managers, investment managers and corporate treasurers put capital to work. There is no doubt they (we) are expecting stock prices to rise over the coming months and years. However, just as airline pilots warn that, we may experience some turbulence along the way, we should expect some as well in the financial markets. This weeks’ turbulence will come from the FOMC and Fed watchers.

Travel Centers of America

I like the way that Travel Centers of America (TA) extended its gains from last week. This is a play on domestic economic strength, low gasoline prices, and increased travel by families and trucks. Furthermore, the company does not have any exposure to the global currency wars. TA was the subject of a recent LakeView Restaurant and Food Chain Report Newsletter issue. If you do not subscribe, please send me an email and I will reply with a complimentary copy of that particular issue.

_____________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long TA — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 16, 2015: Fretting Over Fear of Fed

I had an exhaustive trip back and forth to San Diego last week; working during market hours; a little R&R at the famous Del Coronado Hotel, entertaining clients, friends and relatives at night; plus, an afternoon trip to the world famous San Diego Zoo. I even managed to take some time on the way back to Nevada to stop at an upscale mall northeast of San Diego.

As for the markets, fear of the FOMC raising rates, sent the US Dollar once again higher, energy prices lower and stock prices on a rollercoaster ride. Given the lack of inflation at home and the strength of the US Dollar, I do not expect the FOMC to take any action this week when the monetary authority meets for its two day session on Tuesday and Wednesday.

As for individual stocks, Apple (AAPL) unveiled its iWatch. As an Apple shareholder (personally and for clients) I want the iWatch to be a success. It is likely that people will be lined up for the wearable device. Personally, though, I was quite underwhelmed by the product. I see the potential for the iWatch to expand the Apple ecosystem beyond its current realm, particularly into the medical field. Unfortunately, the first version of the watch will just be a stepping stone to that end objective, but for now it will be a must have product for devotees of Apple products. Still, Apple will ring up several billions of dollars of sales, and potentially, draw in some non-iPhone users into the Apple ecosystem.

When it comes to watch enthusiasts, they are not going to go all gaga over the watch. The gold version of the iWatch coasts $10,000. For that price you can get a nice Rolex which you can have for life, and may even pass down to a few generations. In a few years, that gold iWatch will be obsolete and will be sitting in a drawer somewhere.

As for malls, it seems that in every mall I manage to visit from the midrange to upscale segments, there always seems to be two or three vacant stores, of which usually only one has a “coming soon” sign. That is before the Radio Shack stores shut down forever. As to the low end malls – those typically anchored by Sears (SHLD), JC Penney (JCP) or another struggling retailer – which tend to exist in either obscure or lesser wealthy locales, the vacancy rates are much higher. The bottom line is that the American mall is in decline, thanks to the internet, and overbuilding.

Up and coming restaurant chain, Zoe’s Kitchen reported better than expected results on Wednesday and the stock advanced handsomely the next day. Remember that I remain of the opinion that ZOES has the potential to be the next Chipotle Mexican Grill (CMG). In the meantime, newly public Shake Shack (SHAK) shares continue to struggle as the burger business becomes more crowded. A recent portfolio addition, Travel Centers of America (TA), reported strong results on Friday and surged to a new 52-week high.

With Pi Day now in the rear view mirror, we can focus on the markets. We enter the week with the S&P 500 (SPX) fractionally lower for the year. However, the NASDAQ 100 (NDX) has advanced nearly 2% this year, confirming my contention that growth stocks are garnering investor attention. Yet, with the FOMC due to announce its interest rate decision on hump day, the markets are going to be fixated as to whether the FOMC will remain patient or pull the trigger on tightening. You already know my opinion.

_______________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, QLD, TA and ZOES — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 9, 2015: Growth Stocks Are Back in Vogue

After nearly two weeks of going nowhere, the markets finally moved dramatically in one direction on Friday. It was just not in the direction I was expecting. The markets took the good news from the Department of Labor of better than expected jobs growth as bad news for fear that the Federal Reserve would tighten interest rates faster than expected.

So the good news is bad news trade knocked stocks on Friday. I suspect that it is a one-day blunder rather than the beginning of a nastier decline or pullback. However, there is one important trend that has begun to emerge in the past several weeks.

Growth Stocks Grab Investor Attention

That trend is one in which growth stocks are beginning to attract investor attention to the detriment of value and dividend stocks. For the past two to three years, growth stocks have taken a back seat to dividend and value stocks. The reason was that investors, seeking to chase yield as bonds rates declined, fled toward dividend stocks. That is not to say that growth stocks performed poorly, they did not. Rather they just underperformed the dividend stocks.

Now the tables are being turned, for fear that interest rates will rise as the economy’s growth picks up steam. During the transition from value/dividend to growth, the former will not only underperform growth but also may correct. That is indeed what appears to be happening. In other words, within the realm of stocks, money is flowing from low to higher risk.

This transition period began in January and picked up steam in March. It is becoming most apparent in the utility sector, which was trying to find some support recently, but that support was cracked with Friday's Fear of Fed trade. For those of you with a dividend approach to investing, this does not mean one should bail on that strategy. It means that you have to be patient while the risk reset is taking place. After a corrective period, not only will the stocks find their footing and rebound, but you will also collect some handsome dividends along the way.

Apple Added to Dow Jones

On Friday, it was revealed that Apple (AAPL), the daddy of all growth stocks, was going to be admitted to the Dow Jones Industrials (DJIA). This was something that I had been writing about ever since the stock split 7 for 1 last year. The victim of Apple’s ascendance was AT&T (T). As a result, Apple stock was one of the few winners on Friday. AT&T, a big dividend stock was taken down by the news and along with the rest of the value stocks. Adding to interest in Apple is the release of the iWatch, which is scheduled to take place today amidst much fanfare.

I am going to be travelling to San Diego with a stop in Irvine for lunch tomorrow and then return to Nevada on Thursday evening. I will be connected to the internet and will make one or two posts along the way.

______________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL and T — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 5, 2015: Lots of Crude Oil But Nowhere to Put It

It was another teeter-totter session where stocks opened lower and then bounced back. Yet for the second consecutive session the market still closed about ½% lower. There was really no major news to move the needle in either direction. Instead, it looked like traders were reacting to the crude oil market and squaring away positions ahead of today’s ECB meeting and tomorrow’s jobs report.

Crude Oil Glut, Refinery Shortage

Crude oil inventories continue to rise as capacity to store it diminishes. As it is unlikely that we can build more storage tanks or tankers overnight, crude oil prices will remain low. However, with refinery capacity in temporary decline due to a strike at fifteen facilities, the price of gasoline at the pump will not benefit from the glut in crude oil. So, we will have a disjointed market – low crude prices but not so low gasoline prices.

Costco Has Plenty to Talk About

In the meantime, we are in the midst of the retail segment of earnings season. The big box retailers are holding up well but the teen/tween retailers are hurting. Abercrombie & Fitch (ANF) is lost in the wilderness. On the other hand, despite all of its problems – credit card, Canada – Target (TGT) traded to a new all-time high before giving up some gains by the market close.

Costco (COST) will report earnings this morning. As COST pumps plenty of gasoline, we need to be wary of any revenue shortfalls. What will generate interest from Wall Street is guidance as to what cost savings COST will generate by switching from an American Express (AXP) branded card to a Visa (V) branded card.

Finally, the European Central Bank will, after today’s meeting, provide more details as to its trillion euro quantitative easing (QE) program. What I expect is another rush out of European assets and currency into the US Dollar and US Dollar denominated assets. It is likely that the markets over here in the colonies will get off of the treadmill that it has been stuck on for the past several sessions and finally make a break for the upside.

________________________________________________________________________________________________

My Gut Feeling For Today, March 4, 2015: Utility Stocks Rebound

The Senator from the Great State of Israel, I mean the Prime Minister from the State of Israel, Benjamin Netanyahu gave his much ballyhooed speech to Congress on the subject of Iran and nuclear weapons. If BiBi could run for President of the United States, he would be swept into office.

Obama, Pelosi and Hillary Were Big Losers

In the meantime, three members of the Democratic Party shot themselves in the foot: President Obama for not attending or even watching the speech and then giving some lame answers to reporters’ questions, after the event; Rep. Nancy Pelosi who turned her back on Netanyahu while the rest of the audience rose for applause; and, Hillary Clinton for getting caught exclusively using her personal email for business when in the role of Secretary of State. The only winner for the Democrats was Sen. Menendez for his forthright speech at AIPAC.

Ronald Reagan once said that, “Latinos are Republicans, They just don’t know it yet.“ Had he been alive today, he would have said, “Jews are Republicans. They just don’t know it yet.” When you put it all together, there is very little doubt in my mind' that the Jewish vote is going to migrate to the right, especially as the Roosevelt generation dies off.

Utilities Rebound

As for the markets, during the speech, oil prices were pushed higher and the stock markets were sent lower. At one point, the markets experienced their worst day since January. However, pushing markets around was easy given that many investors and traders were fixated on the speech. After the speech, the markets rallied, cut the day’s losses by about half and finished lower by around ½% at the closing bell.

There are indications that the correction in utilities, consumer staples and other high dividend stocks may be close to an end. Despite the pullback, February, being a popular month for dividends, shielded investors from the price declines. If you are looking to put money to work in the sector, I would suggest Southern Company (SO), Con Edison (ED) or the Utility Sector SPDRs ETF (XLU).

Congress did manage to vote on a clean, no strings attached funding bill for the Department of Homeland Security. It should appear on the President’s desk for signing today.

Now we are down to two events left to grapple with this week. One I added to my initial list from Monday is Thursday’s ECB meeting. Then Friday is the February jobs report. Today, Hump Day, a smattering of retailers will report results and the ADP Employment Report and Fed Beige book will also be released. This is enough to keep us on our toes, but for the most part, the real ammunition is being saved for Thursday and Friday.

While I was going to conduct a midday live chat, I am going to have to push that off as I have some meetings out of the office in the afternoon.

Finally, tonight begins the festival of Purim which PM Netanyahu discussed in his speech yesterday. Enjoy a few hamentashen.

________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long ED and SO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, March 3, 2015: Here Comes Growth Stocks and BiBi

Economic data released on Monday was Goldilocks-like; neither hot nor cold, and was subject to interpretation from both the bullish and bearish perspective. The major averages rose, thanks to several takeovers which were announced before the market opened.

Is NASDAQ 5,000 Significant?

What captured everyone’s attention was the rise in the NASDAQ Composite (IXIC) index to close above 5,000. You have to go back fifteen years since that index closed above that level. There are several reasons why the NASDAQ of fifteen years ago is much different that the index today.

To begin with, the composition of the index back then and now is far different. In 2000 the index was polluted with technology and telecommunications companies that were for the most part shell companies built on a foundation of wishful thinking. In 2015, we no longer have zero value companies at lofty valuations in the IXIC. Today, the price earnings multiple of the index is around 22.5. Back in 2000, the price earnings multiple was nearly five times that of today. In 2000, individual investors were speculating in the market. By most accounts, today they are still underinvested or not invested at all. Finally, exchange traded funds (ETFs) play a larger role in the market today whereby investors will index their assets, across many sectors and indexes. In 2000, traders and investors were chasing the flavor(s) of the day.

The bottom line is that the piercing of the 5,000 level for the IXIC is of little significance, except as a matter of nostalgia. I would add that the IXIC being at 5,000 is not a sign of a rich or overvalued market. The 10,000 level is far more significance as it would come on the back of an economic boom.

Of great importance, is that the rally in the index is an indication that growth investors are coming back to the market. As money flows to growth stocks it comes out of bonds and value / dividend stocks.

Israel PM Netanyahu to Grab Market Attention

To begin the day, the markets will respond to February automobile sales. After that, all eyes and ears will be on Israeli Prime Minister, Benjamin (BiBi) Netanyahu who will deliver his speech to Congress today at 11am EST. I would not be surprised if liquidity and volume dry up during the course of his speech.

_______________________________________________________________________________________________

My Gut Feeling For Today, March 2, 2015: The Tea Leaves Expect Rally to Continue in March

The last week of February, despite Janet Yellen’s two day testimony on Capitol Hill, turned into a non-event. The markets ended a three week winning streak but for the most part did not move much at all. In fact, each of the five sessions of the week resulted in the S&P 500 (SPX) moving not more than about six index points on any given day. In the end, the index rose 5.49% for the month, its best February since 1998 when the SPX rose 7.04%

History Dictates Market Should Rise in March

As it turns out, since 1950, when the SPX rose by at least 5% in the month of February, the index also put in a positive month of March. That occurred on five occasions, with an average return in March of +2.95%. Recall that the first quarter of a pre-Presidential Election year is a strong quarter, the second best in the sixteen quarter Presidential election cycle. The average return for the SPX in such a quarter in the past was +5.15%. So far this year the index rose 2.39%. In other words, don’t be surprised if the market tacks on another 2 – 3% this month.

Weekly Events Should Have Short Term Market Impact Only

Of course, we will have to jump over a few hurdles this week in order to get back into the plus column. This includes: i) Israeli Prime Minister Benjamin Netanyahu's speech before Congress on Tuesday; ii) A Congressional vote on funding the Homeland Security Budget; and, iii) February’s jobs report on Friday.

I would suggest not letting these events alter your investment strategy, as avoiding the current bull market could result in missed opportunities.

___________________________________________________________________________________________

My Gut Feeling For Today, February 24, 2015: Getting All Fed Up

You needed a strong caffeine habit, prescription for Adderall or a good library of movies to have gotten through the trading day on Monday. In case you did not and managed to nod off, both the S&P 500 (SPX), on an intraday basis and old reliable Apple (AAPL) on a closing basis, posted yet another all-time high.

While I mentioned yesterday, that in my opinion, there were no market moving earnings or economic reports on the schedule for this week; there is one event that will likely escalate trading flow and volatility. That is the semi-annual Humphrey-Hawkins testimony by Federal Open Market Committee (FOMC) Chair, Janet Yellen.

It’s Humphrey-Hawkins Time

The investing world will be on the edge of its seats to hear whether, Yellen, like Moses coming down from Mt Sinai, will deliver from the finger of G-d, some news to change the world we live in. However, this time it will be a prognostication of FOMC interest rate policy. Tuesday’s testimony, followed up by a sequel on Wednesday will have Fed watchers and traders all amped up for some hint as to what the monetary mavens have up their sleeves.

The problem is that after receiving last week, the minutes of the most recent FOMC meeting, which took place four weeks ago, what more can Yellen really tell us that was not already telegraphed by the FOMC and its members? Nothing really.

We know that the FOMC is ready to tighten rates based on improving domestic economic growth. We also know that the FOMC is worried about deflation at home and abroad and raising rates now would only exacerbate deflationary pressures. Finally, the FOMC is very worried that an increase in US rates would result in further appreciation in the US Dollar triggering declines in commodity prices at home and additional economic weakness abroad. This would result in a potential global financial crisis part 2, which nobody wants.

Hence, expect that Yellen will spew Fedspeak; of course not with the brilliance of Alan Greenspan, to the merry bands of legislators on Capitol Hill. At the same time she will have to defend the Federal Reserve from growing anti-Federal Reserve sentiment.

All told it will be great theatre, but I would not be leaning against the yield curve just yet.

Today will be my last My Gut Feeling for the week given Wednesday’s Seton Hall Stillman School of Business Capital Markets Colloquium and my travel the end of the week. I will be back to all of you from the other side of the Rockies on Monday after I have rested up from my son’s 21st birthday bash in Las Vegas this coming weekend.

_________________________________________________________________________________________________________

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

My Gut Feeling For Today, February 23, 2015: Seeking Hospitality Somewhere

Just as I expected, European finance ministers went down to the eleventh hour to agree on a solution to the Greek debt crisis. It was more of a stop-gap measure as Greece would only be granted a four month extension, two months less than the Greeks sought. Nevertheless, the can was kicked down the road. As some agreement was better than none, the markets welcomed the decision will bullish applause.

This leaves us wondering what the next great faux crisis that the bears will throw in front of the bull market. I can’t be for sure what it will be, but expect them to get a little creative as the old "crises" are getting long in the tooth.

Priceline Surges

Last Thursday, Priceline Group’s (PCLN) earnings report was met with a standing ovation. The stock surged nearly 100 points or about 8.5%. I decided to raise a little cash on Friday by selling positions in United Parcel Service (UPS). It was not that I was looking to raise cash, but I am seeing many excellent opportunities to deploy capital and UPS was a disappointment; failing to rise as gasoline prices declined and web based holiday orders rose.

Seeking Opportunities in the Hotel & Hospitality Sector

I am looking at some opportunities to deploy capital in the hotel and hospitality sector, to add to positions we currently have in Royal Caribbean (RCL) and Walt Disney (DIS). My research team will be presenting ideas to me on Tuesday (at the Colloquium, mentioned below).

As for the week ahead, there will be a smattering of earnings and economic releases, but none that should be market movers. I will be looking forward to the annual Seton Hall Stillman School of Business Jim & Judy Capital Markets Colloquium on Wednesday. Then on Thursday afternoon, I fly back to Nevada.

________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long DIS, RCL & PCLN — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, February 19, 2015: Market Has More Room to Rally in Next Few Weeks

With the exception of the S&P 500 (SPX) which yesterday declined microscopically, Wednesday was just a carbon copy of Tuesday’s market, in the macro sense. Small incremental moves higher are characteristic of a bull market. There is no reason to expect much different action today. Highlighting the calendar is Priceline Group’s (PCLN) earnings report.

We were able to conduct the weekly chat after resolving some permissioning errors but had to keep it in the main chat room. Next time we should be posting to a dedicated weekly page to which I can provide a link. As next Wednesday is the annual Colloquium at Seton Hall, I am going to hold the next chat in two weeks. Below is appended the transcript from yesterday’s chat.

Portfolio Changes

We were rather busy, selling Dunkin’ Brands (DNKN). Buying Fireye (FEYE) and adding to GoPro (GPRO) on a partial reversal of Tuesday’s surge. Our cash balances remain at low levels as I expect another 3 – 5% move before this segment of the rally peters out in late March or early April. Today, I raised my 2015 price target for Apple to $150 and for Starbucks (SBUX) to $100, the later which is only held in our Restaurant & Food Chain Strategy accounts

Transcript: Do We Really Have to Worry About Higher Interest Rates? Live Chat February 18, 2015

[unedited]

fred

February 18, 2015 - 11:20 AM

Gm Scott is there a way to access previous newsletters was trying to find your pt on wwav

scott

February 18, 2015 - 11:21 AM

@fred: - I will send to you

fred

February 18, 2015 - 11:21 AM

ok thanks

scott

February 18, 2015 - 11:22 AM

Update - we have sold all of our positions in DNKN - will confirm with newsletter later - no new buys with the cash

fred

February 18, 2015 - 11:24 AM

any opinion on fb seems to be stuck in mid 70`s even with good er

scott

February 18, 2015 - 11:27 AM

@fred: you need to have some patience - I see it getting to $90 - $100. Look at what happened with OPK and NATH. Sometime you need to flush out weak holders and then the stocks pops. We ate long FB, OPK and NATH

fred

February 18, 2015 - 11:27 AM

thanks

Guest_620

February 18, 2015 - 11:31 AM

Is the iWatch a sell the news event?

scott

February 18, 2015 - 11:31 AM

As I have mentioned, I am moving more capital into REITs for our dividend stratrgy

scott

February 18, 2015 - 11:32 AM

@Guest_620: it really depends on how well it is received. If people are lined up to get the iWatch and it is in shortage then, no it is not

Kirk

February 18, 2015 - 11:38 AM

good morning

Kirk

February 18, 2015 - 11:38 AM

from a liquidity standpoint, if U.S. does raise rates a bit, what do you feel the impact will be on corps ultimately?

scott

February 18, 2015 - 11:39 AM

@Kirk: - when you get a chance, please email me your phone numberscottallstars@gmail.com thanks

scott

February 18, 2015 - 11:40 AM

@Kirk: I think that a slight rise in rates wont matter. Many smart companies are already borrowing like mad right now. Brian Reynolds believes that the credit bull market has more room to run, even if rates move higher. He is speaking at the SHU Colloquium next Wednesdayhttp://www7.shu.edu/business/capital-markets-colloquium.cfm

Kirk

February 18, 2015 - 11:41 AM

and corollary, how soon does low aggregate demand globally finally impact equities as a group? It seems clear to me if liquidity decreases, and it seems it must eventually since debt can't increase forever ( I think ), then monetary policy follow through decreases and growth numbers matter again.

scott

February 18, 2015 - 11:44 AM

@Kirk: great question. As to global aggregate demand, it really matters if the US weakens or the rest of the world improves. Right now it is likely that the ROW will improve. I do not see a contraction in the US until late 2016 or early 2017. Until then, we could have a nice ride for equities and even after a mild contraction, a 20% decline would not be the end of the world in say 2017

scott

February 18, 2015 - 11:46 AM

What is really the unknow is what happend to bond holders once rates back up. Do they head for the hills or do they act like Pavlovian ladogs and just put cash right back into bonds.

scott

February 18, 2015 - 11:46 AM

What happens that is

Kirk

February 18, 2015 - 11:47 AM

If they sell existing bonds, they take a loss, so there's less money to reinvest, correct?

scott

February 18, 2015 - 11:48 AM

Correct but they have also shifted shorter term. So they sell the short end and buy the longer end. Also, many just sit on cash because in their minds, equities are too risky

Kirk

February 18, 2015 - 11:48 AM

I think the big question becomes, when does debt matter? Does it ever? Or was **** Cheney right?

Kirk

February 18, 2015 - 11:50 AM

I'm not sure the answer. I think in a relative world, if cooperation exists between central banks and developed nations, it can go on a while before another crisis. However, what happens when fraying occurs. When do the central banks and developed markets start behaving like OPEC and throw each other under the bus?

scott

February 18, 2015 - 11:50 AM

Everyone screamed when the debt was increased under Reagan. When we look back, his increase in debt was minimal in today's terms. The whole world is exploding with debt, so, how does it all reset?

Kirk

February 18, 2015 - 11:51 AM

Right, that's the question.

fred

February 18, 2015 - 11:51 AM

have to run thanks scott

scott

February 18, 2015 - 11:51 AM

later Fred

Kirk

February 18, 2015 - 11:52 AM

anyway, I'm just playing with my computer and doing paperwork, feel free to call if you have time.

scott

February 18, 2015 - 11:52 AM

we all become indebted to China and Japan

scott

February 18, 2015 - 11:52 AM

will do thx

Guest_559

February 18, 2015 - 12:33 PM

Good morning, Scott. You counseled patience to someone earlier in the chat. Is the same true for ZOES? Are you still optimistic about their chances? In what kind of time frame? Thanks.

Guest_559

February 18, 2015 - 12:34 PM

Also, any thoughts on Luby vs. Shale Shack, near-mid term? Is Shacl still in its post-IPO honeymoon, ready to fall back?

scott

February 18, 2015 - 12:37 PM

@Guest_559: No opinion on Luby's Shake Shack I want to see in the lower $30s before committing any capital

Guest_559

February 18, 2015 - 12:40 PM

Guest_559

February 18, 2015 - 12:41 PM

And ZOES? (If you're still there...)

scott

February 18, 2015 - 12:52 PM

@Guest_559: Still in ZOES with eyes on holding it for years

Guest_559

February 18, 2015 - 1:13 PM

Thanks

scott

February 18, 2015 - 1:17 PM

need to hop - see you in two weeks

END

__________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, FEYE, GPRO, PCLN & SBUX — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, February 18, 2015: Queries From Readers

The markets fiddled about most of the day, traded within a narrow range and then managed to close in the green, with another record in the books for the S&P 500 (SPX) and Russell 2000 (RUT). Of course, Apple (AAPL) also put in another all-time high of its own.

GoPro and Shake Shack

GoPro (GPRO) which we picked up subsequent to its sell-off after hours on the day of its earnings report while I was in Orlando, put in a solid session, gaining 12.5%. My only regret was not buying more at the time. Shake Shack (SHAK) continues its descent, now declining 25% from its IPO day spike but still 86% above its formal IPO price of $21. When it gets into the lows $30s, it might be worth ordering up some shares.

Q&A: Alibaba and Utilities

I thought that I would respond to some questions that were recently asked by way of email or on Scutify:

- What's the skinny on Alibaba (BABA)? Also, related from someone else: Scott, I'm giving up on BABA. I'd buy it again on the other side of the valley.

A – The market was not satisfied with the rather incredible results and growth when Alibaba reported earnings. It is also getting plenty of negative publicity. What is happening to BABA is similar to what occurred with Google (GOOG, GOOGL) when it was in its infancy as a public company. First was that both companies are headed up by very bright individuals who do not know how to navigate the shark infested waters of the financial markets. Google finally got smart and brought in an experienced corporate manager, Eric Schmidt, to faceoff versus the investment world, leaving its founders to build the company. Perhaps Jack Ma needs to do the same. Second, short hedge funds and their compatriot bearish members of the media tried to pin on Google the notion that “click fraud” was unjustly responsible for revenue and earnings growth. Now, the same crowd is banging the drum on BABA’s clients engaging in selling counterfeit products. In the fullness of time the click fraud was deemed unfounded as will be the assertions against BABA and patience will be rewarded for holders of BABA.

Q - … Therefore utes [utilities] at Fridays close are a gift and should now be added to a portfolios. I already did by the way. Would you comment on this when you get a chance. (Please note that the writer expects that the 10-year US Treasury will trade in a range of 1.5% to 2.5% with an average of 2.0%, in 2015)

A – I mentioned last week in My Gut Feeling that, I have begun to shave off some outsized gains in utility stocks in our Low Volatility / High Dividend Portfolio. In their place I plan on buying shares in a REIT, to be determined. Perhaps the question was posed from my proposed course of action. There is no doubt that companies’ stock with dividends in excess of that of the SPX, about 2.0%; are attractive given that medium term interest rates are also about 2.0%. At least with stocks, you can also benefit from modest, but consistent earnings growth. This is what I do in our Low Volatility / High Dividend Strategy for our clients. That being said, utility stocks have appreciated considerably over the course of the last two years, such that certain individual holdings are too large relative to our desired asset allocation within that strategy. Hence, I am taking some gains off the top of a few utility stocks and reinvesting the proceeds into REITs (real estate investment trusts) which also offer excellent yields when compared to the SPX and 10-year US Treasury. However, we are not abandoning our holdings in the utility sector as they still fit the requisite characteristics to be included in the strategy.

Keep sending those questions and I will share my answers in this daily commentary in the future. We are going to try once again, after last week’s technical problems, to conduct a weekly chat. Please join me on the specific chat page for February 18, 2014 rather than the general home chat page at 11AM.

We have finalized the speaker lists, topics and time for the 2015 Jim & Judy O’Brien Financial Markets Colloquium at Seton Hall University. It is free to the public and I hope to see you then.

Finally, tax forms are now available to our Scottrade clientele on the broker’s website.

__________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, GOOG, GOOGL & GPRO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, February 17, 2015: Is Berkshire Hathaway Overpriced?

Now that we made it through the Valentine’s / President’s / Deep Freeze holiday weekend and the SNL 40 celebration, we can focus back on the market. Equity markets enter the week with the S&P 500 (SPX) and Russell 2000 (RUT) at all-time highs with Apple (AAPL) on another growth spurt.

However, the Europeans are going to be Debbie Downers as negotiations between Greece and its creditors appear to have broken down on Monday. Just as the US Congress always has a knack for taking its budget and debt ceiling negotiations down to the wire, I do not see our cousins across the pond doing anything different.

Crude Oil Moving As Expected

Crude oil prices have rebounded about 23% to around $53/bbl. However, the price at the pump has not materially increased over the same period of time. More people are focused on heating oil rather than gasoline as they remain hunkered down for the Deep Freeze. I remain of the opinion, stated in My Gut Feeling for 2015, that crude oil “is likely to decline to the $40s before experiencing a dead cat bounce to the $70s, ending the year in the $60s.” Crude oil bottomed in the $40s and appears headed in the direction of my higher target. I also expect that it will take stocks along for the ride to the upside.

Berkshire Hathaway Holdings Starting to Wilt

American Express (AXP) was delivered two knock-out punches last week as both Costco (COST) and Jet Blue (JBLU) are ending their branded card relationship with Amex. Berkshire Hathaway (BRK/a, BRK/b) holds nearly 14% of Amex. Several other large Warren Buffett holdings are also getting hit as of late such as International Business Machines (IBM), Coca-Cola (KO) and Procter & Gamble (PG). Yet, shares of Berkshire Hathaway remain near all-time levels. Something has to give, but as long as shareholders continue to deify Buffett, it is likely that Berkshire Hathaway shares will get dumped.

_____________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL & PG — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, February 12, 2015: All Quiet Ahead of Presidents' Week

It was without question an incredibly boring day on Wall Street. The major indexes flat-lined most of the session and ended just about even, with the exception of the NASDAQ 100 (NDX). Thanks to Apple (AAPL) scoring another all-time high, rising 2.3% to nearly $125, the NDX advanced about 3/8%

Other than January retail sales being reported before the market open, there is not much else of excitement on the calendar. Some earnings reports from yesterday evening such as Cisco (CSCO), Baidu (BIDU) and Tesla (TSLA) will spill over to today’s action. Overall, it will be one of those days to catch up on research and paperwork. Just as the S&P 500 (SPX) traded within its normal high / low range of nearly 1.5%, on Wednesday, it is likely to do so again today.

Given that Monday is Presidents’ Day and many schools are off, this weekend and next week is the last big opportunity to get away to the ski slopes. Thus, the lethargic market action that occurred yesterday and I expect for today, will likely continue through next week; which should find the B-Teamers in charge. So, unless Greece and Oil stirs things up again, the markets will get the rest that it needs and deserves.

Before I sign off till next Tuesday, there are two administrative items that I want to pass along:

Several people tried to join the live chat yesterday but were unable to. We will check to see if there are any technological issues and then reschedule for next Wednesday
The annual Jim & Judy O’Brien Financial Markets Colloquium will take place at Seton Hall University on Wednesday February 25. The event is open to all, so feel free to come. Next week I will have a full agenda of speakers to share with you.

Have a great holiday.

_____________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BIDU — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, February 11, 2015: Apple Value Surpasses $700 Billion

Apple (AAPL) closed above $120 per share, to a new record of $122.02 and in the process surpassed $700 billion of market capitalization. That is about twice the market cap of Google (GOOGL) at $366 billion. In my opinion, this is just a rest stop on the way to being the first ever $1 trillion company. In order to do so, the stock would have to rise to about $171.70. I don’t see that happening in 2015, but it could happen by the end of 2017.

Apple also had an interesting announcement after the market close. The company will invest $850 million, spare change for the company, in a solar farm with First Solar (FSLR). There are also rumors that Apple has been pilfering employees from other Silicon Valley competitors to develop other leading edge technologies.

The One Percenters

Earnings from Coca-Cola (KO) and news that an activist investor is seeking a board seat and $8 billion buyback from General Motors (GM) helped to move the Standard & Poor’s 500 Index (SPX) higher by over 1%. It was the fourth positive 1% move in that index in the last seven sessions, since February began. The index now stands just over 1% away from a new all-time high. As I have been saying, Apple’s earnings would help to erase January’s market loss and then move the index to a new high.

Bond prices have stabilized after Friday’s drubbing. There is so much talk of Greece having to leave the Euro; that the markets are beginning to accept it as a near certainty. Hence, once it does occur, after an initial re-pricing of the Euro, markets will likely shrug off the news. I would not be buying the Euro anytime soon. Also, a Greek exit from the Euro would likely put the FOMC on hold so as not to further appreciate the US Dollar.

Taking Some Profits in Utility Holdings

I have begun to shave off some outsized gains in utility stocks in our Low Volatility / High Dividend Portfolio. In their place I plan on buying shares in a REIT, to be determined.

Live Chat Today

After a break for the holidays and some business travels, I am going to start up my weekly free chat once again. This week's chat will take place today, and run from 11am to 12pm at http://www.lakeviewasset.com/asset-management-discussion-room/do-we-really-have-to-worry-about-higher-interest-rates/ I hope you can join in on the conversation

______________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL and GOOGL and short KO — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

My Gut Feeling For Today, February 10, 2015: Until Further Notice, It Is All About Greece & Oil

The equity markets traded most of the day in the red and closed across the board down 40 basis points, plus or minus about 10 basis points. Oil prices gained and bond prices gave up some ground, continuing Friday’s moves, albeit it to a lesser magnitude.

Angela Merkel and Barack Obama held a meeting, as leaders of their respective nations on the subject of Russia and Ukraine. That was followed up by a news conference which the financial media covered. The markets could care less about the meeting or news conference.

McDonald's Reports January Sales

McDonald’s released its January sales. While sales in the US and Europe rose, Asian sales declined miserably. CNBC asked me to discuss those sales on air during the network’s Closing Bell show. While we never got to discuss McDonald’s sales in detail, there was a discussion on the merits of owning McDonald’s, which as always I was not shy to express my opinion. Here is a link to the segment.

Marathon Petroleum Surpasses $100

Marathon Petroleum (MPC), refiner, retailer and specialty products company; not Marathon Oil (MRO), the oil exploration and production company; closed over $100. This was a pick I mentioned right here in My Gut Feeling last year and we have held ever since. Wrongly, the stock got sold off as oil recently tanked as it was mixed up with its doppelganger E&P twin, MRO. It paid to have patience with the stock until the misinformed traders and hedge funds realized that they had MPC all wrong. My price target entering 2015 for MPC was in the range of $105-$110. I might bump it up a little but there is no rush to do so. I also might be inclined to shave off a little MPC, so as to lock in some profits.

Coca-Cola (KO), a stock in which we are short in our Restaurant & Food Chain Portfolio is the biggest name to report earnings today. I am likely to cover this short and ring up some profits should it drop to $40. Tomorrow we will reinstate my weekly chat. More information to follow in tomorrow’s commentary.

Until further notice, the market is all about Greece and Oil.

My Gut Feeling For Today, February 9, 2015: Are Rates Finally on the Rise?

My calendar was such that I could not publish My Gut Feeling while at the Money Show in Orlando at the end of last week. My apologies. So what went on while I was away?

The only meaningful transaction I performed while I was in the Sunshine State was to buy a starter position in shares of GoPro (GPRO), subsequent to the stock’s sell-off, despite an excellent quarterly report; after the market closed on Thursday. The stock is now off its all-time high set in October of $98.47 by over 50%. Yet, nearly 64% of the stock is sold short. At $98.47 the stock was way too expensive. At $47, the stock is cheap given its 30% growth rate, selling at 35 times 2015 earnings.

Is the Bond Bull Market Finally Over?

Non-farm payrolls for January rose 257,000, nearly 30,000 over expectations. Furthermore, December non-farm payrolls were revised higher by 80,000 to 320,000. The knee-jerk reaction to those economic data points were to anticipate an earlier than anticipated FOMC rate hike and send bond prices lower and yields higher, across the curve.

Is this the end of the great bond bull market of 1980 – 2015? I can’t say for certain, but picking the bottom in rates has been a fools’ errand for so long. We know that rates are certain to rise, just when that will begin to occur remains uncertain. Given the strength in the US Dollar and problems in Europe, I do not think that improving payrolls are going to be the impetus for an early rise in rates. If you want to play it safe, the best action you can take is to avoid any fixed income instrument with a maturity of over five years.

Buffalo Wild Wings Surge; Dividend Stocks and Bonds Slump

All week, stocks and crude oil prices rallied; though stocks did, for the third straight Friday, experience a late afternoon bout of profit selling. The rise in rates on Friday took some air out of dividend stocks. That was the bad news. The good news was that Buffalo Wild Wings (BWLD), a long term holding in client and personal accounts surged to all-time highs after reporting results and proving upbeat 1st quarter guidance.

The calendar is rather quiet today, with Lowes’ (LOW) earnings just about the only interesting announcement of the day. As a result, the EU – Greek soap opera and crude oil prices will continue to drive trading. Finally, if its Monday, then it must be another winter storm in the northeast, so stay warm and safe.

___________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BWLD and GPRO — although positions can change at any time.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

My Gut Feeling For Today, February 3, 2015: The Market Does the Texas Two Step

The first trading session of February was a mirror image of the last trading session of January. Yesterday the markets were rather quiet and then took off like a rocket in the last half hour. From Thursday's close to Monday’s close the S&P 500 (SPX) moved 0.4 index points or 0.02%. It was just about the distance that the Seahawks needed to win the Super Bowl, before calling one of the all-time worst offensive plays in football history.

Crude Oil Rallies Above $50

So why did the market reverse with such oomph on Monday, despite another batch of disappointing economic data points? It seems that crude oil prices which rose about $3 to close at $50/bbl, might be the culprit.. What the move in oil all means, is really up to one’s opinion. Some may believe that crude oil has finally put in a bottom and the rally in oil helped to rally energy stocks. That certainly helped our positions in the Energy Select Sector SPDR (XLE). It could be nothing more than a technical reversal. I remain of the opinion that after bottoming in the $40s, we will see a sustainable rally back to the $60s - $70s. I can’t guarantee that it will be straight line.

Airline and other travel related stocks did get hit on Monday. Again, why; is a matter of opinion. Some might argue that the back up in crude prices was the cause. Others, and I am in this camp, is that the massive amount of cancelled flights over the past week after two major storms was the real cause.

Potential for a Quick Greek Settlement

A potential hint of optimism is coming out of Greece, where is appears that an agreement might be struck between that nation’s new leader and the rest of the EU. If that is the case, then the rally that commenced on the way to new highs which was derailed by the Greek election might now be back on schedule.

I am flying to Orlando on Wednesday where I will be giving two lectures at the World Money Show at the Gaylord Palms Resort. On Thursday at 9:35 AM I will be discussing “Investing for Millennials Over the Next 30 Years.” On Friday at 8:00 AM I will be lecturing on “The Fallacy of the VIX.” I will try to post my next commentary from the Sunshine State.

_______________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long KYE — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, February 2, 2015: Shake Shack Is Too Pricey

January 2015 was a carbon copy of January 2014, with the major indexes posting solid losses each time. While earnings seem to be coming in as expected or better, the strong US Dollar is weighing on top line sales and revenues. This is causing the market to take a pause in fear that the continued strength will impede earnings growth in the coming quarter.

4th Quarter GDP Decelerates

Not helping the bulls’ cause on Friday was a disappointing first cut of 4th quarter GDP. Although, the market was flat until about 2:30PM after which sell orders hit the tape and continued right up to the closing bell. Helping the tech market was the positive reaction to Google’s (GOOGL) results with the internet stock jumping nearly 4 ¾%.

Shares of Shake Shack (SHAK) began trading. After pricing at $21 the stock opened for trading at $47, traded as high as $52.50 and then closed the session at $45.90. The stock does not justify such a high valuation and I did not buy any stock, as tempting as it might be to chase a potential momentum fad stock. Perhaps we can get a Facebook (FB) type of shake out in the stock price and in a few weeks you can buy shares at lower prices.

The Super Bowl was an exciting game but the commercials were as overhyped as they were overpriced and frankly disappointing. Comcast’s (CMCSA) NBC Universal unit was a big winner after last year’s one sided game in which televisions were turned off by halftime.

Earnings season peaked last week but that does mean that the show is over. There are several important earnings reports this week, including some major energy companies. The game plan is to stay level headed as the push me – pull you action of traders will likely keep the markets in flux for a bit longer. Also, its another snow day in the NYC metro area; likely causing some low volume action today.

_________________________________________________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long FB & GOOGL — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 30, 2015: The Stock Market Is Not Always Rational

libaba (BABA) reported 4q14 earnings of 81 cents, when adjusted for non-recurring one-time expenses versus expectations of 74-75 cents and 13% year over year, reflecting the massive increase in diluted share count due to the company’s IPO. Revenues increased 40% year-over-year, but that was apparently not enough as it missed expectations by about 5%.

Amazon.com (AMZN) reported earnings of 35 cents versus expectations of 17-19 cents and 51 cents a year ago. Excluding foreign exchange losses, AMZN sales rose 18% year-over-year to $29.3 billion, falling short of expectations of $29.7 billion by 2%. Management guided to an annual decline of first quarter operating results from last year’s $146 million profit to a range of $450 million loss to $50 million gain.

Market Irrationality Creates Opportunity

So, guess what; shares of Alibaba slid nearly 9% and shares of AMZN surged about 12%. Does this make sense? I argue no. Amazon revenues are growing at a slower rate and the company will struggle once again to make a profit, after a losing year in 2014. Alibaba is growing at a 40% clip both in the trailing year and is expected to do so in 2015.

The market is not rational in the short run, as traders rather than investors make short term decisions. As John Maynard Keynes said, “The market can stay irrational longer than you can stay solvent.” By the way he was not a good trader. The point being that you should not let short term irrationality sway your long term opinion. Also, don’t bet too big on the short term because if you do, you won’t be around for better times ahead.

The stock market is the only place I know where people want to buy merchandise at marked up levels rather than on sale. Again; that’s not rational. If you walked into Macy’s (M) and saw a nice Ralph Lauren (RL) shirt selling for $50 yesterday and came back to the store today with that shirt priced at $60, would you rush to buy it? No, you would wait for a sale when the shirt was marked down to $40. Well, in the case of Amazon, we have $290 merchandise selling for $350; whereas in the case of Alibaba, we have $120 merchandise selling for $90. So, to answer many questions that I received today about what to do with Alibaba, the answer is to buy more, as it is on sale. In the fullness of time you will be rewarded.

Speaking of irrationality, Google (GOOGL) reported results after the market closed. The company reported earnings and revenues which were below expectations, thanks to the strong dollar. Initially, the stock declined 5% after hours and then reversed course clawing back the loss and then tacked on another 1.5%. The reason was that the initial knee jerk reaction by traders was based on reported headline results and then once factoring in the impact of foreign exchange, investors came in to scoop up shares on sale.

McDonald's Interview

I received a call from CNBC in the afternoon asking me to appear on air to discuss the management changes at McDonald’s (MCD). I had just completed a derivative lecture at Seton Hall, so I literally raced to the CNBC studios to participate in the segment. Here is a link to the interview but be aware that the segment was truncated and I next spoke about how MCD is worth only holding for the dividend as the growth we enjoyed from 2003 to 2013 can no longer be expected in the future.

Shake Shack Launches IPO

Finally, the Shake Shack (SHAK) IPO was priced at $21 and will begin trading today. My opinion is that this stock is pricey but has some limited growth opportunities as long as it can expand into urban and upper class locales. Furthermore, it will be a fad stock, so you want to get in and then expect a short lived price spurt at which time you will want to flip for profits. Examples of other fad stocks are GoPro (GPRO) and Crocs (CROX). Look at the dramatic rise and fall for GoPro and Crocs after those companies’ IPOs.

Just one word of caution on SHAK. The stock was priced at $21 and is certain to open for trading at a higher price. Do not pay too much for the stock in the after market and remember to put in limit orders.

_____________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long BABA, GOOGL & MCD — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 29, 2015: McDonald’s Move Is Not Enough

The day started off on a good foot given the Apple (APPL) results and Yahoo (YHOO) news that I discussed yesterday. However, after the FOMC released their statement following this week’s meeting, traders used the opportunity to sell. Frankly the FOMC told us nothing new or more than even a casual observer of interest rate or economic theory already knew. These nonsensical and random reactions to the FOMC - either up or down - really have become quite annoying. They are not worth gaming or trading, so you just sit back and let it play out, again whether up or down.

McDonald's CEO Steps Down

What I really want to focus in on is the news after the market closed. No, not Facebook (FB) which reported a good quarter but felt a little top-line pinch from the strong US Dollar. Rather I am talking about McDonald’s (MCD).

I am often considered an expert on McDonald’s (MCD) and have spent considerable time writing and analyzing about the company as well as being interviewed by the press – television, radio and written. McDonald’s’ big news was that CEO / President, Don Thompson was stepping down and being replaced by branding chief Steve Easterbrook. I have been calling on McDonald’s to make some bold changes, including replacing Thompson, who has been a major disappointment since taking over from Jim Skinner in 2012. However, I was calling for that replacement to come from outside of McDonald’s as the company needs a fresh, new and independent leader. So, to some extent the announcement yesterday was welcome but only went halfway. We own McDonald’s for its dividend in our Low Volatility / High Dividend Strategy.

Alibaba and Google Report Results Today

It will be another busy day for earnings with headliners Alibaba (BABA) and Google (GOOGL), reporting before and after market hours, respectively. Also of interest from my perspective are Harley Davidson (HOG) and Royal Caribbean Cruises (RCL). Do not let the reaction to the FOMC yesterday cloud your thinking and keep focused on earnings.

______________________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, BABA, GOOGL, MCD & YHOO — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 28, 2015: The Big Apples and Buy Yahoo Today

I recall many years ago, the late Mayor Edward I. Koch had New York City so well prepared for a storm, that after the storm passed without much damage to the city, Koch, in a press conference said that the city scared the storm away. As it turned out, NYC scared Winter Storm Juno, to areas east of the Big Apple, which is where Juno inflicted its worst damage. In the meantime, it was business as usual in the financial markets.

Apple Reports Spectacular Results

Speaking of the Big Apple, Apple (AAPL) reported an absolutely incredible quarter, earning $3.06 per share versus expectations of $2.60 on revenues of $74.6 billion versus expectations of $67.7 billion. iPhone sales set records, thanks to the roll out of the new 6 series. Clearly, while other companies are being negatively impacted by the strength in the dollar, Apple did not even incur a flesh wound. The company now holds $178 billion in cash and liquid investments. That puts it in the territory of the FOMC when it comes to Treasury operations. To put it in perspective, AT&T (T) has a market capitalization of $170 billion and Canada (pre-energy crash) has a GDP of about $1.8 billion US Dollars. As for the iWatch, we have to wait till April for that rollout.

Buy Yahoo - Today

Yahoo (YHOO) also reported results after the market closed which were slightly better than expected. More importantly, the company, in a tax-free transaction, will spin off it’s nearly $40 billion holding in Alibaba (BABA). Yahoo’s market cap is $45.5 billion as of yesterday’s close, but the stock advanced about 6% after the announcement to just over $51. After adjusting for the company’s tax liability of $3.3 billion for its partial Alibaba stake sale as part of the company’s IPO last year, Yahoo still has $4.7 billion in cash and short term marketable securities on its balance sheet. In other words, you can buy Yahoo stock just about for free. But that’s not all. Yahoo also owns 36% of Yahoo Japan which is worth another approximate $7.3 billion. When you put it all together, just in cash and investments, Yahoo is worth $52 billion, excluding its actual operating business, which is about $55 per share.

If you recall, prior to Alibaba’s IPO I was loading up on Yahoo stock. Once the IPO priced, we swapped out of part of our Yahoo position into Alibaba, which we began to purchase at $90.25 on the IPO day, then adding a bit more a few weeks later. BABA closed just under $103 yesterday. Subsequently, we sold a little more Yahoo and now hold roughly 1/3 of our original position. So, what do you do now? With Alibaba set to report results tomorrow, which I expect to be excellent, you want to add further to Yahoo today, regardless of what pop the stock might get.

Let me conclude by saying that Apple is our largest and Alibaba our second largest holding in the LakeView Growth Strategy portfolios. As you can see, I put my money where my mouth is. Alibaba, in my opinion, is where Apple was when we first started to buy that stock in January 2005; a very early stage in its growth as a company.

________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, BABA, T & YHOO — although positions can change at any time.

LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

My Gut Feeling For Today, January 26, 2015: Let It Snow

Right on cue the ECB announced its asset purchase program on Thursday and the markets surged. I have to say that I was right on the money with that event and stuck to my guns getting the portfolios positioned for an advance. Friday, the markets experienced a hangover and pulled back a little bit; in part to profit taking and in part in anticipation of the Greek election.

I called an audible on Thursday afternoon and bought some Starbucks (SBUX) before the company reported results for our Restaurant & Food portfolio accounts. That audible indeed paid off as the stock rallied to all-time highs on Friday.

Maxists Win Greek Election

As expected and feared the Marist Syriza party gained the largest amount of seats in the Greek election. The party leader, Alexis Tsipras, promised to reverse the austerity measures which Greece was forced to accept in exchange for European debt restructuring and loans. US futures indicated between ½% and ¾% decline in the overnight session. Let’s face it, Europe is a mess and all that the Greek election will do is rub salt in Europe’s wounds. In the short run there may be some market weakness in the States but I feel confident that in the medium term markets will rise to new highs.

Blizzard Could Disrupt Wall Street

What is likely going to collide with the Greek news is the huge winter storm; a blizzard most likely, that will be hitting the northern and northeastern states. In the NYC metro area we will get around two feet, plus or minus a few inches (I can't get back to Las Vegas soon enough). Several years ago I looked at the impact of winter storms on the stock market. Strangely enough, since 1960, the market rose ¾ of the time on the first trading day after a major storm. I will place a high degree of probability that the NYSE will close on Tuesday and have a delayed opening on Wednesday. Hence, given the Greek news, traders are likely to be net sellers on Monday before the exchange closes and step back in once it does reopen.

What will be interesting is; should the US exchanges close, what companies which are on the earnings calendar for Tuesday, decide to do with their earnings releases. This week is the heart of earnings season. To top it off, would you know it, the largest public company in the world, Apple (AAPL), is set to report results after the market closes on Tuesday.

Stay warm and safe and most likely I will issue my next My Gut Feeling on Wednesday or Thursday, based on the weather and exchange openings.

______________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL & SBUX — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 22, 2015: Super Mario to the Rescue

The markets spent another day in suspended animation awaiting the European Central Bank’s (ECB) monetary policy decision. At about 8:30 AM Eastern time, ECB President Mario Draghi will likely unveil a quantitative easing (QE) program which is expected to purchase about $50 billion Euros of debt securities per month. Anything short of that will be met with the Bronx Cheer all the way from Brussels to New York, but I do not expect that a disappointment will be delivered.

The concern that I have for a QE program for Europe is that it will further drive down European interest rates and the EUR currency. It is likely that the Swiss National Bank anticipated all of the above and decided to throw the towel in on the EUR last week on a preemptive basis.

In the meanwhile, back in the colonies, earnings season continues. There are a few airlines - United Continental (UAL) and Jet Blue (JBLU) – as well as Union Pacific (UNP) and Starbucks (SBUX) that are reporting results, which I find of interest. I am looking to buy some SBUX for our restaurant strategy on any dips below $80.

I am sensing that the market wants to take another run at the all-time highs that were recently set. If the market can survive the ECB announcement without getting dinged, then next week’s earnings report from Apple (AAPL) could be the event that puts us back over the top.

__________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL & UNP — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 21, 2015: IBM No Longer Relevant

Tuesday’s market action was as I expected: quiet with beaten down issues – technology in particular – getting a lift. The State of the Union address was a non-event, except for the major networks who felt a need to cover the broadcast. The speeches (including the Republican response) were already released to the press, so why bother watching?. In the past, some sectors which were going to benefit from the address would get a post speech bump, but that is no longer the case as the speech was already old news and is likely to have zero impact going forward.

Netflix Surges, IBM Stumbles

Earnings really picked up speed yesterday. Last evening Netflix (NFLX) reported an increase in subscriber growth which is helping the stock to surge by nearly 20%. The shorts are getting squeezed on that stock. IBM (IBM) continues to flounder as was apparent with its earnings report. This morning United Health Group (UNH) is up about 2% on better than expected results and Interactive Brokers (IBKR), despite posting better earnings fell short on revenues and stated that they will sustain losses in the 1st quarter due to the Swiss National Bank actions of last week. I fully expected that IBKR would be hurt by recent currency dislocations.

When it comes to IBM, let’s face facts. The company is no longer the dominating leading edge technology company that it was in the 1960s to 1980s. Furthermore, the much ballyhooed CEO, Ginny Rometty has failed to make a positive impact on Big Blue. Unless IBM can become relevant again, the stock will continue to decay, leaving itself vulnerable to activist investors.

MLPs on Display After Hours

Technology companies eBay (EBAY) and F5 Networks (FFIV); as well as midstream energy company Kinder Morgan (KMI) and industrial equipment company United Rentals (URI); will keep us busy after the market closes with their earnings reports. KMI could be the lynchpin for a turnaround in the master limited partner (MLP) sector if it reports minor impact from the bear market in crude oil. We still hold Kayne Anderson Total Energy Fund (KYE) which was purchased late in December as a bottoming play in the MLP sector.

Lacking any significant intraday news, I am expecting another quiet session which will be stock specific in activity and movement as global markets await tomorrow’s ECB announcement.

________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long KYE & URI — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 20, 2015: Getting Over the Swiss Virus

On Friday we left off with the aftermath of the Swiss National Bank’s sucker punch to the currency markets. As a result, FXCM (FXCM) the internet based forex broker had to be rescued by Leucadia (LUK), parent company of Jeffries, with a $300 million capital injection in the form of a loan. The $830 Everest Capital Global Fund was wiped out. Losses of $400 in total were estimated at Citicorp (C ), Deutsche Bank (DB) and Barclay’s (BCS) with additional yet to be disclosed losses estimated in the billions of dollars across other institutions.

Of course, there may be winners that are on the other side of the ledger. You won’t hear about who those winners are; but I can make a few guesses. The Swiss National Bank is certainly a winner (financially not ethically) as is the Federal Reserve and US Treasury. Swiss-based Julius Baer Group (JBAXY) said it was not impacted. No word from Goldman Sachs (GS), which leads me to believe they were on the other side of the hedge funds and likely made a few bucks or francs.

It Turned Out to Be Another 48 Hour Virus

The Swiss news came on the heels of Friday’s option expiration in the US markets and ahead of the three-day holiday weekend. The markets flip-flopped around in the first hour and then rallied right into the close. As I mentioned in Friday’s commentary, there were two ways that the US might react to the Swiss action: “At worst, I would say that we could experience a full-fledged much anticipated correction which takes the market down 10%, of which we are already halfway. On the other hand, we might open lower today, reverse course and the whole Swiss affair turns out to be a 48-hour virus.”

As it turned out we caught a 48-hour virus with the bottom occurring in the lows of the first hour decline on Friday. Once again, as we experience four times last year, the market experience a quick 4 – 5% decline only to find buyers willing to step up to grab stocks.

An Action Packed Week

On Monday, Chinese stocks took a tumble after the government put curbs on margin accounts. However, European markets rallied, proving that the SNB and Chinese government actions had very short legs.

Earnings really begin to pick up steam this week. However, the main event will be the European Central Bank (ECB) meeting on Thursday, January 22. At that meeting, the ECB is expected to unfurl a European quantitative easing program whereby it will begin to purchase several hundred billion Euros of debt securities.

On Tuesday, President Obama will deliver another State of the Union address in which he will good back to the well once again with a plan to escalate his class warfare. What was once an important speech used to rally a nation around its challenges and goals – think Kennedy and Reagan – is now just a free partisan commercial. Tuesday’s edition will likely draw a viewership low in the modern TV era.

After Friday’s moonshot, given what is on the week’s agenda, and some money managers likely taking an extra day to return from the ski slopes, I expect a quiet session, one in which some recently beaten down issues could get a bit of a bid.

_________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC had no positions in stocks mentioned — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 16, 2015: Switzerland Throws a Curve

Without provocation or notice or even a hint, the Swiss National Bank threw the global markets a huge curve. This is one of those exogenous events that one cannot anticipate but can only react to. The bank had previously maintained a cap on the Swiss Franc (CHF) / Euro (EUR) exchange rate. On Thursday the Swissies removed that cap, the CHF rallied over 20% versus the EUR, the US Dollar rallied and, Swiss stocks tanked.

Several Currency Brokers Are in Dire Condition

Foreign exchange brokers such as FXCM (FXCM), Gain Capital (GCAP) and Interactive Brokers (IBKR) all took hits as clients were short the CHF and did not have enough collateral to cover their losses. Of those three brokers, FXCM is in dire straits. Those forex broker clients are primarily hedge funds who were short CHF and were highly leveraged. Expect some of those hedge funds to go under as well. The world is wondering what positions George Soros, a big currency player is holding.

Recalling October 1987 and Asian Contagion

This development could possibly be a game changer. When currencies begin to dislocate, we are reminded of October 1987 or the Asian contagion of the 1990s. I want to be quite clear, I am not expecting a currency war or a market crash, but the Swiss action should put us on high alert. At worst, I would say that we could experience a full-fledged much anticipated correction which takes the market down 10%, of which we are already halfway. On the other hand, we might open lower today, reverse course and the whole Swiss affair turns out to be a 48-hour virus.

Be Cautious But Don't Act Foolish

The beneficiaries of the Swiss action will likely be US Government Bonds, US Corporate investment grade bonds, the US Dollar and high dividend US stocks. The benefit from lower oil prices around the world, and particularly the US will have a delayed benefit that won’t begin to trickle in until later this quarter or the second quarter.

So, remain on alert, but DO NOT panic. Moving to cash always feels good in the short run but in the fullness of time is always a mistake because you tend to get back in at higher levels. The financial sector which I was warming up to is now on the back burner. In fact, you may now have exposure to dividend stocks or the US bond market which will be a safe haven until the Swiss dislocation corrects itself.

If there is one action I do immediately recommend, it is that any individual or investment advisor that has accounts at FXCM (FXCM), Gain Capital (GCAP) and Interactive Brokers (IBKR), move their account to a better capitalized broker immediately, less they take the risk of not getting their assets out as was the case with Lehman Brothers or MF Global. At LakeView Asset Management, we custody and broker client accounts at Scottrade and UBS Financial Services, so our customer accounts are in good hands. If anyone has assets at one of those in troubled brokers, I will be happy to make introductions at to Scottrade and UBS.

Lastly, don't let what I just wrote scare you. Read it two or three times and let it sink in first to understand its full context.

My Gut Feeling For Today, January 15, 2015: Crude Oil Rebounds

The best way to describe yesterday was disheveled. JP Morgan (JPM) reported earnings which came in 12 cents below estimates and retail sales data indicated a decline for December. On the other hand, Wells Fargo (WFC) reported an in-line quarter. As a result of the sales and JPM results, the markets swooned for most of the day. Although WFC’s quarter was as expected, it felt some collateral damage (off 1.2%) from Dimon & Co, as JPM declined about 3.5%.

JP Morgan Still a Government Target

JPM was impacted on the revenue side by lower trading profits thanks to the Volker Rule and increased legal expenses. Those legal expenses were incurred to fight the constant barrage of federal and state lawsuits against the bank for what occurred during and before the financial crisis. Whenever the Feds need another billion dollars, they know they can squeeze it from JPM.

Was the Bounce in Crude Oil For Real?

Toward the end of the session, crude oil jumped about 5% and brought in stock buyers. All said, the major averages were lower by about ½%, except the Dow Jones Industrials (DJIA), which because of JPM, which is a constituent stock, was lower by just over 1%.

As for those retail sales, I have said many times that holiday shopping, which traditionally took place in December, is being spread over many more months and across more channels of distribution. Take a look at this chart which my colleague and friend Cody Willard posted on Scutify.

The Standard & Poor’s 500 (SPX) stands about 4% off of its all-time high set in December. We had several pullbacks of that magnitude last year. I would also remind readers that January 2014 had a similar decline to start the year.

The real question to be asked is with crude oil’s dramatic turnaround yesterday, which lifted stocks off its lows of the day, has crude oil put in a floor and will stocks rally alongside the commodity? It is a very real possibility and I would note that with monthly derivative expiration set for Friday, we could be at an inflection point from which many assets classes will rally.

Another positive sign in Wednesday’s market was the bounce in the biggest fad stock of the last year, GoPro (GPRO), maker of high tech video camera equipment.

In conclusion, I think that if you want to get some exposure to the financial services industry, Wells Fargo or Capital One (COF) might be your best choices. As for the general market, by now you should have nibbled on some energy, if not then now is as good a time as any to do so. Recall that I recently purchased SPDR Select Energy ETF (XLE) and Kayne Anderson Total Return Fund (KYE).

_________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long KYE & XLE — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 14, 2015: Financial Earnings to Pace the Day

Alcoa (AA) results and positive economic data helped to set up a strong open. By 10:30AM the Standard & Poor’s 500 (SPX) rose 1.15%. This, according to my own research, kicked in my 1% Rule Trade.

1% Trade Rule Was Successful

The 1% Rule Trade has the following parameters. If at 10:30AM the S&P 500 (SPX) is rising by at least 1% then traders should short sell index exchange traded funds (ETFs), futures or similar products. If at 10:30AM the S&P 500 (SPX) is declining by at least 1% then traders should purchase index exchange traded funds (ETFs), futures or similar products. The trade is to be unwound by the end of the same trading day and not held overnight. The timing of the unwinding of the trade within the day is discretionary with particular attention paid to taking profits. The index used for the trade is also discretionary. Exceptions to the rule are on days: with a shortened trading schedule; days in which the monthly labor report is issued; days on which the FOMC or a major central bank takes or is scheduled to release monetary actions.

Those early gains began to dwindle late in the morning and disappeared entirely by 1:30 PM, turning into steep losses in the afternoon, yet, closing in the red well off the day’s lows. In the final analysis, had you traded the 1% Rule, you would have been a winner.

Why the markets turned around, is a subject of speculation. Some believe that it was due to news out of the EU. Others chalk it up to profit taking. For whatever reason, the traders were keeping the long side investors honest. Reports that Mitt Romney would make another run at the White House may have helped to lift stocks off of their lows late in the session.

After the market closed, Tesla (TSLA) chairman Elon Musk stated that Chinese sales were less than expected. That sent the car maker’s stock lower. TSLA stock is rather speculative and could go lower. However, we own the convertible bonds maturing 2021 for several client accounts which yield 3.79% to maturity while still offering some upside benefits.

Financial Services Earnings in Focus

Today, there are several important economic releases, retail sales and the Fed Beige book, which should continue to support the trend in economic improvement in the US. JP Morgan (JPM) and Wells Fargo (WFC) the nation’s two largest financial institutions will report results and conduct their conference calls before the market open. I am looking to put some capital into the financial sector and would welcome a bout of profit taking to get better entry levels. The reason for my interest in the financial sector is that in a rising rate environment, such as I expect later this year, net interest margins and hence profits should improve.

_______________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long TSLA convertible bonds — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For Today, January 12, 2015: Getting Down to Earnings and Energy

The end-the-year and beginning-of-the-year festivities, reviews and prognostications are now in the books. Holiday travels are over and the major market players are back at work, as we get down to business with earnings. While fourth quarter earnings are important because it will close the books on most companies’ fiscal years, what this earnings season is going to do is set us up for guidance and outlook for the year that just began.

Economy Could Achieve Escape Velocity in 2015

I provided my macro view for what to expect in the New Year with My Gut Feeling For 2015. My expectations for the broad market were for the most part a carbon copy of last year, However, there are risks both to the upside and downside. While companies are leveraged for further acceleration of the economy, what we refer to as reaching “escape velocity”; market participants remain on high alert that some exogenous event or economic dislocation could finally bring about a much anticipated correction that could will last beyond a few days.

Capital Put to Work in Energy Sector

So far this year began with some give and take, none of which we should extrapolate. The energy sector appears to have bottomed and we put some capital to work the past three weeks in two tranches. First, before the end of the year, shares of Kayne Anderson Energy Total Return Fund (KYE) were added to the growth portfolio, prior to the fund going ex-dividend on December 26. Then last week the Energy Select Sector SPDRs (XLE) was added as well. KYE is focused on midstream master limited partnerships (MLPs) whereas XLE is concentrated in upstream exploration and production. The former dividend yield is now 7.29% and the latter is now 2.54%.

I expect that energy prices will remain low but will rebound at some point this year. In the meantime, we will collect some nice dividends and stand ready to add to these positions if they should fall further in the near term. While energy price declines are the result of excess supply in the market, lower prices are also stoking demand.

This weekend we returned by car from Nevada to New Jersey. Along the 2,650 mile route (we took a slightly different route than on our westbound trip several weeks prior) the lowest posted price at a gas station where we fueled up was $1.669 per gallon. At sub-$2.00 gasoline prices, there is no doubt that consumers will be making more extensive travel plans come later this year. That is good news for hotels, restaurants and hospitality companies. As you know, we are on top of the restaurant industry. I will focus future research on the hospitality sector, beyond Walt Disney (DIS) which we already own.

Over the past few weeks, I participated in two television interviews. On Bloomberg I discussed the upcoming Shake Shack (SHAK) IPO and on CCTV I discussed the luxury consumer and leather prices.

_______________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long DIS, KYE & XLE — although positions can change at any time.

LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ

– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For 2015

The secular bull market continued in 2014 and should do so for several more years. This does not mean that stocks will go up in a straight line but that the path of least resistance is bullish. Whereas 2013 was a banner year for growth stocks, in 2014 value stocks took the driver’s seat and pushed growth into the rear view mirror.

I mentioned in My Gut Feeling For 2014 that, “2014 will not be as easy as 2013 but it also will not be pleasant for the bears and hedge funds, both of which have suffered from performance issues during this bull market.” Those words rang true in 2014. The year began on a soft note but resulted in setting new highs for the Standard & Poor’s 500 (SPX) on multiple occasions, closing the year at 2,058.90, about 1.50% shy of its all-time closing high of 2,090.57 set on December 29. The road to those highs was not smooth and as I expected would be back-end loaded in concert with the Midterm elections.

The SPX index experienced several mini-pullbacks throughout the year and one significant correction of nearly 10% in October, when the year-to-date gains were virtually erased on a very scary day as Ebola fears gripped world markets. Thus, you likely suffered some financial whiplash along the way. However, there was no real opportunity to get defensive because those pullbacks were fleeting. The October correction did permit LakeView Asset Management to move a little to cash and reposition the portfolios for what was a strong year-end rally. The one weak point for the markets in the year occurred in the energy sector as the price of crude oil crashed becoming the last commodity to finally end its super cycle.

The midterm elections not only delivered an historically strong 4th quarter but that strength normally extends to the 1st quarter of the following year, which I expect to be the case is 2015. So without further ado, here is My Gut Feeling for 2015:

The SPX ended 2014 at 2,058.90, which using Bloomberg’s Standard & Poor’s 500 earnings estimates of 113, implies an index price/earnings multiple (PE) of 18.22. Standard & Poor’s own analysts estimate that SPX earnings for last year should come in at 116.77 implying a year-end index PE of 17.63. Bottom up estimates for 2015 earnings as complied by Standard & Poor’s for its SPX index are expected to increase by about 12.2% to just around 131.01. In 2015, my expectations are for 6% nominal earnings growth with another 2% of anti-dilutive earnings growth due to buybacks. Hence, my SPX earnings estimate (using averages of the two independent sources as a base) is about 124.20. The SPX earnings multiple should continue to accelerate but a little less than I expected this time last year, to 18.5 in 2015. Hence, I am setting a year-end target for the S&P 500 at 2,297, about an 11.6% year-over-year increase. Concurrently, the NASDAQ 100 (NDX) will finally reach and surpass its tech bubble closing high set in March 2000 of 4,704.73.
The Federal Reserve Open Market Committee (FOMC) quantitative easing asset purchase program or QE3 has ended. While the FOMC and its chair, Janet Yellen have been coy with the markets as to when it will tighten the Federal Reserve Target Rate, I expect that they will technically tighten to a firm 0.25% from the current range of 0 – 0.25% in one of the last three meetings of the year which will take place in September, October and December. This will set the market up for further tightening in 2016 when I expect that equity markets could decline for the first time since 2008.
The thirty-five year bull market in bonds will try desperately once again to maintain status quo but maybe, it has no more gas in the tank. The 10-year US Treasury yield began last year at 3.03% and did not back up at all. Rather, it continued to rally to 2.17% at the end of 2014. The insatiable appetite for United States Government debt is unrelenting given the high yield relative to other sovereign debt of the same maturity, such as Japan (0.33%) and Germany (0.54%) and the strength of the US Dollar. Unless inflation picks up, which is not likely, the 10-year US Treasury will remain strongly bid and at most will back up to 2.40% by the end of 2015, putting a flesh wound in to the bond bull, likely setting up a more dramatic backup in rates in 2016.
US Gross Domestic Product (GDP) was hampered last year in the 1st quarter due to severe wintry weather across the nation resulting in a decline of GDP in that period of 2.1%. This caused some pent-up demand which coupled with an improving labor market generated GDP growth of 4.6% in 2q14 and 5.0% in 3q14. That trend should continue in the 4th quarter but may be hampered by the downward shift in energy prices. As for 2015, on a quarterly basis, I expect GDP in the US to grow by: 3.0% in 1q; 5.0% in 2q; 5.3% in 3q; and 5.5% in 4q.
Energy prices have been in a free fall, as NYMEX Crude Oil declined by around 50% since last summer. There are several reasons for the decline, including; a global oil glut, increasing North American production and economic sanctions against Russia. In my opinion, crude oil is the last major commodity or material to end its super cycle. NYMEX Crude Oil ended 2014 at $53 and is likely to decline to the $40s before experiencing a dead cat bounce to the $70s, ending the year in the $60s.
The energy and material market crash will cause several dislocations in the financial markets. While it will be good for consumers and corporations that rely on energy; everything from trucks to restaurants, there is another shoe that will fall. The huge amount of debt issued by energy companies – drillers, exploration & production and oil sands, in particular – will result in energy market debt defaults. Energy company merger and acquisition activity will take part at a frenzied pace not seen since the 1980s as the haves swallow up the have nots.
A special commission on sports injuries will be established by Congress. In the hot seat will be the National Football League (NFL). However, the commission will go beyond its stated purpose and stray into the social issues that have plagued the league. At risk is the NFL’s anti-trust exemption which will be put on trial. Despite everything, the Washington Redskins will retain the team name and logo.
A major multibillionaire investor dies unexpectedly, leaving a void in their fund / management structure causing their main holding company or investments to drop precipitously. Possible candidates are (in alphabetical order with current age) Sheldon Adelson (81), Warren Buffett (84), Carlos Slim Helu (74), Carl Icahn (78), Li Ka-Shing (86), and George Soros (84). Believe me, I do not wish any of them dead, especially Adelson, who has been quite kind to my son and his friends at UNLV and is a strong supporter of Israel. I am just trying to point out the vulnerability of the related stocks to these highly successful, yet, aging group of billionaires. For those with public holdings, the Koch brothers pick up shares on any death related sell-off.
The 2014 midterm election debacle for the Democratic Party is not over. Nancy Pelosi is forced to step down, not because of her losing party backing, but because of “family or health reasons” (her speech is not sounding very fluid these days, in my opinion). Harry Reid’s recent injuries cause more serious problems than are now being reported and force him to step down early as well, Hillary Clinton cannot detach her stint as Secretary of State from the Obama administration’s poor diplomatic record. Elizabeth Warren throws her hat into the Democratic Presidential nomination process. As Clinton and Warren fight and shift even further to the left, a more moderate candidate is drafted by the Democrats. Despite his prior desire not to run, Andrew Cuomo secretly sets up an exploratory committee. While conventional wisdom has already declared Clinton as a shoe-in for the nomination, now other centrist Democrats jump into what will be a crowded field, In the meantime, Latinos flee the Democratic Party in reaction to the President’s decision on reestablishing relations with Cuba. On the other side of the aisle, Republicans join together to form a Jeb Bush – Chris Christy fusion ticket in 2016.
This is going to be a redo of a 2014 expectation. Better late than never. Google (GOOGL) after a disappointing performance in 2014 will take several corporate actions, in an attempt to become more investor friendly. The company will try to make its shares more attractive in comparison to the stock of Apple (AAPL). The two classes of Google stock will be merged back together. Then the Google board will declare a dividend equal to 2% on a yield basis. Furthermore, a $10 billion buyback funded by debt will be authorized. Finally, the stock will split 5 or 10 for 1 in a pre-arranged move to gain acceptance in the Dow Jones Industrial Index, along with Apple and Berkshire Hathaway class B shares (BRK-B) in what turns out to be a shakeup of the index. Removed from the index are Cisco (CSCO), Pfizer (PFE) and Coca-Cola (KO). In the case of the latter, one Buffett stock is replaced by another.

__________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, GOOG, GOOGL, KO & QLD — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com
– Read Scott’s intra-day thoughts and comments on Scutify
– You can email Scott at scott.rothbort.lakeview@gmail.com

My Gut Feeling For 2014 - A Look Back

As we exit the prior year and begin the new year, I wanted to take a look back at My Gut Feeling For 2014 :

The SPX ended 2013 at 1,848.36, which using Standard & Poor’s earnings estimates of 107.25, implies an index price/earnings multiple of 17.25. Bottom up estimates for 2014 earnings as complied by Standard & Poor’s for its SPX index are expected to increase by about 13.3% to just around 121.51. Given stronger than expected Gross Domestic Product (GDP) in the second half of 2013, once the dust settles, SPX earnings for last year should come in at 107.50. In 2014, my expectations are for 8% nominal earnings growth with another 3% of anti-dilutive earnings growth due to buybacks. Hence, my SPX earnings estimate is about 119.33. The SPX earnings multiple should continue to accelerate to 18 in 2014 and 19 in 2015. Hence, I am setting a year-end target for the S&P 500 at 2,148, about a 16% year-over-year increase. When the SPX crosses 2,000 it will cause a media sensation. - While I was too conservative in 2013, for 2014, my expectations were a bit too high. The SPX closed at 2,058.90 (+11.39%), which according to Bloomberg equated to earnings of about 113 and with a Price/Earnings multiple of about 18.22. The index did reach all-time highs on several occasions over the course of the year, peaking at 2,093.57 in late December.
The bond market got its first taste of an expanding economy and reduction in the Federal Reserve Open Market Committee quantitative easing asset purchase program. The 10-year US Treasury yield surged from 1.76% at the end of 2012 to 3.03% at the end of last year. I foresee further backup in 2014 to 3.75% which is enough to chase more investors out of bonds. - That backup in yields never took place despite the ending of the FOMC's Quantitative 3 Easing (QE) program. Nor, does it appear that a significant backup, if at all will occur in 2015.
United States corporations are leveraged to growth in US Gross Domestic Product (GDP) as a result of cost controls, low wage pull inflation and strong balance sheets. Furthermore, the US economy is secondarily leveraged to what I expect to be improving economies in Europe and China. Latin America, other than Mexico, especially Brazil will remain in the economic doghouse. Increasing crude oil and gasoline inventories will keep domestic energy prices low, helping to spur consumer activity and economic growth. My expectations are for real US GDP to grow from an average of 3.0% in 2013 to an average of average of 4.375% in 2014. Unlike 2013, real GDP growth will be smoother, primarily as a result of a less contentious budgetary process in Washington D.C. On a quarterly basis, I expect GDP in the US to grow by: 4.0% in 1q; 4.0% in 2q; 4.5% in 3q; and 5.0% in 4q. - As I expected, Washington was not the problem in 2014. The weather unexpectedly threw a monkey wrench into to economy in the first quarter. From then on, I was right with the direction and magnitude of economic growth which rose by 5.0% in the 3rd quarter.
100 point moves in the Dow Jones Industrials (DJIA) and 10 point moves in the SPX will become more commonplace. That will not be as a result of increased market volatility. Rather, it is just the mathematical reality of higher market index levels. However the financial media won’t get it as they see the world through an absolute rather than relative perspective. From a relative perspective, 100 Dow Jones points in 2014 is akin to about 60 points ten years ago. - There is no doubt that 100 point moves in the Dow Jones Industrials (DJIA) and 10 point moves in the SPX have become commonplace, so don't let them fool you in the future.
Gold, which declined in 2012 for the first year, so it seems, since my Bar Mitzvah, will not fare much better in 2014. However, the glittery metal which closed at around $1,205 after an approximate 28% crash in 2013 will experience a bear market rally in 2014, most likely in the first half of the year. However, once the year is over, gold will resume its decline. - I was spot on when it came to the glittery metal. Gold was another victim of the end of the commodity and material super cycle rising early in the year then falling to multi-year lows in the 2nd half of 2014.
After several years of excellent stock market returns, in 2014 several underperforming CEOs will get the axe. Some compassionate boards will allow those CEOs to retire or step aside for family reasons. Possible candidates are Cisco’s (CSCO) John Chambers, McDonald’s (MCD) Don Thompson and Caterpillar’s (CAT) Douglas Oberhelman. Those three corporate leaders don’t stand alone as there are plenty other CEO candidates for the unemployment line. CSCO rose about 9% in 2012 and 14% in 2014. MCD declined 12% in 2012 and rose about 10% in 2013. CAT was barely changed in 2012 and 2013. Compare all that to the SPX which rose by 13.41% in 2012 and 29.60% in 2013. - Those aforementioned CEOs are in the hot seat but managed to keep their jobs in 2014.
The Sochi Winter Olympics will be a public relations nightmare for Russia. The event will be plagued by old style Russian cheating and new style Chechen political unrest. A terrorist attack during the Olympics, either at Sochi or elsewhere in Russia will precipitate a global market pullback of 5 – 7%. - It was not the Chechens that caused the problem, it was Russian President Vladimir Putin who was the instigator. After the Olympics, Putin's incursion into Ukraine did cause that expected pullback on worries that a larger escalation of hostilities would occur.
Republicans pick up seats in both the Senate and House of Representatives but fail to hold a Senate majority. Nancy Pelosi is forced aside as minority leader. With Pelosi out of the picture and Steny Hoyer being seen as too old, the Democrats select Xavier Becerra as their new house leader in order to get younger and place a Hispanic in a senior position ahead of the 2016 Presidential Election which could have some Latino Republicans make a serious run at the White House. - I get partial credit for this expectation. The GOP gained seats and majorities in both houses. Still, Nancy Pelosi remained as House Minority Leader.
Microsoft (MSFT) cannot find a compelling or willing candidate to replace CEO Steve Ballmer. Already Ford’s (F) Alan Mulally has said not to bother asking. Bill Gates realizes that his efforts in Africa are just a waste of time and money as Barron’s recently pointed out. Gates attempts a second act as CEO for Microsoft, hoping to do for that software company what the late Steve Jobs did for Apple (AAPL). In the long run, Gates will fail where Jobs succeeded. - Microsoft did find a new CEO, Satya Nadella, while Bill Gates is still trying to fix the world's problems.
Google (GOOG) will take several corporate actions, this time in an investor friendly way. The company will declare a dividend equal to 2% on a yield basis. Furthermore, a $10 billion buyback funded by debt will be authorized. Finally, the stock will split 5 or 10 for 1 in a pre-arranged move to gain acceptance in the Dow Jones Industrial Average Index, allowing Dow Jones to offset the weakness in its second largest constituent, International Business Machines (IBM). The victim of GOOG’s inclusion in the DJIA will be the aforementioned CSCO. - Instead of Google, it was Apple that took investor friendly actions by splitting its stock 7 for 1 and boosting both the company's dividend and stock buyback, setting the company up for inclusion in the Dow Jones Industrial Average Index in 2015.

Tomorrow I will present My Gut Feeling For 2015.

_________________________________________________________________________________

Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, and GOOG — although positions can change at any time.

Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant and agricultural stocks. A subscription is included with a paid Platinum Membership to Wall Street All-Stars or an individual subscription to the newsletter which can be ordered at www.restaurantstox.com

Read Scott’s intra-day thoughts and comments on Scutify

You can email Scott at scott.rothbort.lakeview@gmail.com