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Prepared by and Scott
Writing under the nom de plume of J.L. LORD

Wednesday | October 7, 2020

Hello Eizell.





YESTERDAY: October 6

SPX 3360.95 -47.68

In the MORNING COFFEE REPORT yesterday, I stated we were going higher, but might test 3400 (-8 points lower) along the way. That is EXACTLY what we did, even with Powell speaking. That alone is a miracle as he has a tenancy to destroy markets when he talks off script. It is not his fault. He just doesn't toss around the MBA terms to confuse people, forcing them to assume he knows what he is talking about, that previous chairmen did.

Then a funny thing happened on the way higher. As the Minis were running to hit the highs of 3369.50, President Trump had enough of Pelosi's games. I am not sure what she does, or what she has accomplished since it is legal to defecate on the streets of her district, drop hypodermic syringes in playgrounds, and they have the worst homeless situation in the nation.

For the last two weeks, Mnuchin has offered a $1.6 TRILLION dollar corona relief package. Pelosi keeps rejecting it and insisted on it being $2.2 TRILLION. The extra $600 Billion has been reported (though no one knows for sure) all fluff for her constituents. It is being described as holding Trump hostage to get what he wants, and the cost is $600B. I want to emphasize that I can't confirm this, and have no way of knowing for sure, but........I kind of have no reason to doubt it. Apparently, we have to pass the bill to see what is in the bill. This is a woman who is Speaker of the House and has refused to see the President for 10 months. You don't have to like the guy, but he is the President and you have a job to do. Jeez.

President Trump called her bluff, and said no package until after the election. This took Minis from +28 to -48 in a very short period of time, and that is where we closed.


TODAY: October 7


President Trump called Pelosi's bluff, and said no package until after the election. These things are almost always over done. My guess is Trump has come up with a “plan B” to help airlines and people that doesn't require him to deal with a hostage situation where taxpayers always get shot in the wallet.

Careful at 2pm Eastern when the Fed releases its minutes. Just because Powell didn't nail us yesterday doesn't mean he can't today.


October 15 – Presidential debate #2
October 22 – Presidential debate #3

I am still standing by my prediction (made December 31, 2019) that we will be positive for the year and making new all-time highs by the end of the year. I maintained this stance even when the SPX was down -36% for the year (this has been here since January 1).

S&P 500 Price Limits

From 8:30 a.m. to 2:25 p.m. CST, there are successive price limits corresponding to 7%, 13%, and 20% declines below the previous trading day’s reference price.

From 2:25 p.m. until the 3:00 p.m. CST close of the cash equity market, only the 20% price limit will be applicable.

Average year with lots of intermittent volatility
(+4.03% so far)

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