Wynn’s Tornado of Adverse Events Continues

By Dan AmossPosted September 2, 2020

Shares of casino owner Wynn Resorts Ltd., our latest short idea, continue to lag the market for very good reasons. Wynn faces a triple tornado of adverse events. These include the pandemic, the resulting economic depression and trouble for their Macau location. A rebound will surely arrive, but how large it will be is unclear. As revenues decline and debt load rises, these headwinds will continue to put downward pressure on its stock price.

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Jim Rickards’ Crash Speculator

Dan Amoss

Dan Amoss, CFA, tracks aggressive accounting and other red flags that markets miss. He’s a student of the Austrian School of economics and Daily Reckoning fan since 2000. Agora Financial relies on Dan for macro market commentary as well as profitable plays like his 2008 call to readers to buy Lehman Bros. puts, which...

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Pickier Bond Investors Spell Trouble for Stocks

By Dan AmossPosted August 21, 2019

One of the trends we watch at Crash Speculator is action in the corporate bond market, as it always senses trouble before the stock market does. Currently, junk bond yield spreads are rising while stocks remain popular. This divergence is a warning sign for stocks as it was before the last bear market in 2007–08.

Why a VIX Spike Causes Bids for Stocks to Disappear

By Dan AmossPosted October 30, 2019

The VIX, or volatility index, is a valuable indicator of stress within capital markets. When the index spikes, bids for stocks are dropped, which can cause prices to plummet overnight. When a geopolitical crisis causes higher volatility, there are few buyers anymore looking to bid for value stocks on weakness. As a result, the VIX can quickly overwhelm other factors and lead to abrupt declines in the major stock indexes.

This Disruption Will Soon Hurt Restaurant Stocks

By Dan AmossPosted October 2, 2019

The restaurant industry has always been a competitive business. With the advent of food delivery apps, the competition has intensified. The net effect of the food delivery boom — once incremental sales fade — will be to significantly lower profit margins at the restaurant level. Lower margins along with weaker consumer spending on discretionary items will put immense pressure on restaurant stocks.

Paradigm Shift in Markets Could Favor Short Sellers

By Dan AmossPosted July 24, 2019

Investors expect the next round of Fed rate cuts next week will push Treasury bond yields even lower and stock prices even higher. But good returns are simply future returns being pulled forward by the “present value effect.” The danger is future earnings that are awarded a high present value often fall short of expectations during rate-cutting cycles.

Early Warning from Micron is Bad News for Microchip

By Dan AmossPosted August 19, 2020

The semiconductor industry is experiencing hard times as Micron is experiencing high inventory levels due to the pandemic and a crash in consumer spending. That is a warning for Microchip Technology, which depends on consumer sales in hardware and business investment for most of its revenue.

Why Carvana is Not the Next Amazon

By Dan AmossPosted September 16, 2020

One key to distinguishing the failure of a company that truly has the potential to mimic a younger Amazon is whether or not that company’s business model is easily copied. Carvana’s model is much more capital-intensive than a young Amazon was, and any number of catalysts could break the Carvana stock bubble in the coming weeks. That’s why we are holding a bearish option position in the portfolio.