TUESDAY MAY 27 THOUGHTS

The only time I was in northern California was in January 2000. While there, I perused the "San Francisco Chronicle" one morning and remembered a blurb that has stuck with me for the last eight years. The number of qualified public school teachers had declined disproportionately from 1995 to 2000. Literally, if the average S.F. school teacher had an apartment, his/her entire monthly salary went to paying his/her rent. That is how hot the tech bubble was.


I was reminded of this over the weekend when speaking with someone who owns a factory. Several of his employees have quit in the last six months. Apparently, many of his former workers lived in other states in the area to avoid the cost of living in te new York area. So, they'd commute upwards of 2 to 2 1/2 hours each way every day. Furthermore, things like Amtrak aren't available where they live and even if they took such transportation, their arrival point in the New York area would be too far fromthe factory time-wise. Thus, they drive. But now, they can't afford to drive based on the wages they earn. Thus, a) wages must rise to meet this problem or b) fuel prices are causing more problems in real life than anyone reading this really realize. It also indicates that this will lead to other problems anew in the financials as credit tightens back up as banks become increasingly afraid to make loans again. This will be a theme trading-wise, I feel, for some time to come.

Markets in Asia and Europe were net slightly down the last two days. Oil, yet one more time again, is up a dollar in the early going. Stock futures are mildly lower state-side. overall, today stands to be slow with people extending their holidays by a day, but I do think there will be a bit of short covering in any spot of oil weakness what with the equity markets coming off their worst week in three months.


SSN- went from 2.75 to just shy of 8 in tw odays and back down to a 3.91 close Friday. If some of the small oils begin going, this should have a nice short covering bounce today... iwish it'd gap lower...if it did, I'd buy thru unchanged. Conversely, if, say, it opened at 4, dipped to 3.80, and went back to 4, I am a buyer at 4.

SINO- massive range on Friday and I would hope for same pattern as SSN described above. In a gap lower, I'd buy it thru unch.

LEH- see theme above. Out of range put options are priced very high for whatever reason...there are rumors around about liquidity again. I've done a trade already this morning very early in it. If stock opens very weak with a ocuople of notable relaoding sellers, get short...otherwise, if it begins upticking, it will likely bounce as it was down a lot last week...and for now...it is just rumors.

BUD- still rumors of being bought out. The Budweiser family seems to be a little more receptive to a deal. Stock should be up today. if it gets negative, it is a short thru unchanged.

AMV/WS- The warrants had some weird move on Friday afternoon. It doesn't show on the charts, but the stock got to 1.40 intra-day- most of those trades were busted. However, the warrants closed way up from where they should have been considering AMV didn't move on the day. Thus, thye should trend back down today.

FTK- bizarre warning this morning. The company should be doing well in this environment and it is not...I actually look to trade this from the short side today.

GNK/EXM/DRYS- stocks were down daily last week; ithink they bounce on short covering and look for a play on the long side.

Slow earnings calendar-
BMO, VOD before open and BGP, DCI, SNDA, WX after-hours.

Slow news day overall...careful trading today.

Good luck.