1/24 Recap. We Continue To Fiddle While Rome Burns.

Sorry for the late recap today, I was looking into a couple earnings after hours. Let’s start with Microsoft. They barely beat expectations on cloud 31% vs 30.6% and the stock zoomed up to levels not seen in a few weeks. They missed revenue and nobody seems to care. Windows revenue was down 40%, PC revenue was crushed and it’s always bullish! Then we had COF report and it’s down a whole 1% on what I thought was a pretty bearish read into the consumer. Here, read this

Ayesha Tariq, CFA @AyeshaTariq

All eyes on Microsoft but, this is also one to take notice of: Capital One $COF Provision for credit losses $2.42B vs FS $1.88B Net charge-offs $1.43B vs FS $1.32B Credit cards are in trouble and companies are bracing for impact.

Remember all the credit card data/personal savings numbers I posted yesterday? Well Capital one is preparing for ALOT of people to not pay their bills, but hey, it’s always priced in, right? The real world continues to see data worsening by the day and the bulls are cheering stocks going up! That’s where we are. Well I have something to tell you, and if you followed my tweets today, you saw this, but in real terms, your stocks aren’t up during this little rally we’ve had the last 4 months. Wait what James? My stocks are up, surely that was a typo. No, it was not, and here is why

Here is the stock market rally we’ve had the last 4 months

and here is the dollar during that timeframe…..

See how the dollar went down MORE than your stocks went up? So technically, you didn’t make money if you performed inline from late september till now. Me, I’m fine, I’m up almost 50% in that timeframe so I made a few bucks in real terms.

So with all that said, it is amusing how excited everyone is over stocks rising as the dollar plunges into the abyss. It is what it is, like I said, similar to Nero fiddling as Rome burned.

Let’s look at today. The SPY closed right below that uptrend and with MSFT reporting, it’s up another $1 after hours, how we close this friday will be big. We still have alot that is going to happen in the next 7 sessions with Apple,Google, Amazon,Meta,Tesla all yet to report. We also have to wait for the MSFT call which has moved the stock dramatically the last few quarters.

Today’s Unusual Options Activity & What Stood Out