Cody Kiss & Tell: Oil, bonds, earnings and more

Reminder: I’m very excited to tell you that we’ve finally launched the new TradingWithCody site at http://twc.scutify.com. We’re going to host our Live Q&A Chats at 2pm EST Wednesdays in our new Chat Room, http://twc.scutify.com/members. The new TWC site and chat room are much cleaner and faster and we are building it to our own specs.

We are also going to roll out a new TradingWithCody app using the new Chat Room and site in the next couple months, and you can imagine how excited this App Revolution guy is about that! To meet us for today’s Live Q&A Chat and to access the new http://twc.scutify.com site, make sure you’re registered on Scutify.

We’re still working out some kinks as we transition all of our current subscribers to the new site and chat room, so if you’ve registered on Scutify and still can’t get into the new http://twc.scutify.com, just let us know your username on Scutify we’ll manually set you up on there. I’ll have both the old TWC and the new TWC Chat Rooms open during the Live Q&A Chat today, in case any of you show up in the old Chat Room instead of the new one.

Just a one time thing to register on Scutify if you haven’t yet. And I’m not ever going to terminate the existing TradingWithCody.com site. All the old articles and archives will remain here on this old TradingWithCody.com site. You’ll still be getting my articles in email form just the same as always and our contact email (support@tradingwithcody.com) and my contact info and support from our resident all-star Rene Mooshy will all remain the same.

Here’s the transcript from this week’s Live Q&A Chat.

All right, folks – let’s go ahead and kick off this week’s Live Q&A Chat a few mins early. Ask me anything! Very exciting to use our new site/Chat room finally.

Q. Whats your take on the SNDK miss? one time? too much supply?

$SNDK’s miss wasn’t too big (~$100MM on revs and ~200bp on Gross margins) on a $1.8BB run rate. Samsung and other smartphone vendors are struggling to compete against Apple at the high end and China’s Xaomi at the low end, and that’s caused a bit of a ripple of inventory build up of flash storage. No change to our long-term Revolution Investing thesis that Flash memory is in a secular growth phase that will last for several more years at least.

Q. since your AMBA sell yesterday its now down 10%- NICE call any interest here to pick some bk up?

Yea, that $AMBA tanked from its new all-time highs of yesterday morning. I might nibble a little $AMBA back near $50 or below, but we’ve had a huge run in it and I’ve still got a good-sized position in it and I’m in no rush to add it back from a strategy/balance perspective.

Q. are you in belief that lower oil is here to stay for some time until demand really picks up as supply is NOT slowing and that lower energy WILL lead to a better global economic pickup?

I think you framed your question about oil prices all wrong. I am of the belief, as I’ve outlined repeatedly in the last few months, that there’s a lot of supply coming on line still in 2015, no matter where oil prices are during 2015 and that will cause a self-fulfilling cycle of lower prices and keep a cap on oil prices being able to go higher. I don’t believe that low energy/oil prices will lead to any sort of meaningful or sustainable global economic pickup in the same way that high energy/oil prices didn’t cause a recession. Consumers, especially poor consumers, will benefit and so will transport companies and any energy-intensive business. Oil companies and energy companies and countries that depend on energy and oil will be hurt badly and many will go outright bankrupt in coming years. That’s my thesis.

Q. What do you make of RECORD low bond yields? do you foresee when cd’s or 10yr bonds will yeild 4-5% again?

4-5% bond yields will likely happen after and/or cause a major financial system/economic reset. The longer we’ve been at 0% (seven years now) the worse the imbalances that are being built up will get. Maybe we’ll see 3-4% bonds in the next year or two.

Q. What are your expectations for FB moving into earnings later this month?

I think $FB earnings report will be stronger than expected but that the market is already expecting that too. $FB is one of my largest positions and I had trimmed some around $80 a few weeks ago and I’m holding it steady for now.

Q. for a while now you have been saying you are increasing your cash position and decreasing your long positions. What does that mean in terms of a percentage of your overall portfolio, cash vs. stocks/options?

I don’t think it’s helpful for me to give you my own personal % allocations of cash vs stocks, etc, as my own income levels, upward mobility, cash in other accounts, net worth, assets and so on are unique to me and don’t apply to anybody but me. I have reduced my # of positions and increased my cash balance on the sidelines repeatedly throughout the last year. Hope this helps. Let me know if it does.

Q. How is BKS staying this strong on 300 point down day?

I don’t care to try to figure out one day’s stock action. I’ve said I sorta hope $BKS gets up to $25-26 level so I can add to my small short position in it.

Q. WTI now up 3.5%. Do you think the market is going to follow and rally too?

Why would you think the stock market action will intraday follow oil’s action? For one thing, stocks have been very strong while oil’s crashed the last year.

Q. What’s your criterias for choosing Call options/Leaps vs Buying stocks direct when you add positions..ie. SNDK?

No set formula for deciding on common stock vs leaps/options, but I mainly use common stock and usually have more than just a few options.

Q. what makes you think wearables will be that popular?

One main reason I’m so bullish on #Wearables in just one pic. See below.

Q. What are your expectations for GOOG earnings later this month?

I think $GOOG‘s at risk of missing analyst expectations for this upcoming quarterly earnings report, but like with $FB‘s good report likely being already priced in, I think much of the bad news for GOOG is likely priced in right now. I’d likely add another tranche of long-dated $GOOG call options if it dropped down to $450 or so.

Q. You have very strong feelings on gold, I might have asked you in the past so excuse the possible repetition. Why do you think gold can see your strong targets that far eclipse even hi’s seen 3 years ago @ $1900’s?

Rates have to go back up at some point in my lifetime, in the next half century. If 4-5% bond yields will likely happen after and/or will cause a major financial system/economic reset, we’ll want to have owned some physical $GOLD during that reset. The longer we’re at below market rates (been at 0% for seven years now) the worse the imbalances that are being built up will get. The US will have a major financial crisis or two in my lifetime and gold will be part of the reset.