2021.06.25

Last Week Tonight John Oliver Westminster dog show Smooth Chris weimaraner

A lot going on in this one, here's a quick table of contents:
Fyretruck

Lordstown Motor Company Endurance article Lordstown Week

A few weeks back I checked in with how Lordstown's fanboy and PR regiment was coping with the loss of their CEO and savoir on the heels of a "short seller hit piece".

I've since taken a small short position - because it's one thing to root agains the Patriots and their stupid fans, it's another to actually place a bet against them. My rationale is that if/when LMC misses-but-don't-miss their production start date in September, the writing will finally be on the wall. Misses-but-don't-miss? "Starting production" is such a vague and weaselable term.

That said, if a vehicle doesn't come off the line a week later, I can see the market all-but-giving up on the company.

That said, $10 October puts were going for like $3 last I checked. Hitting break-even on this isn't unlikely if September brings bad news, but the profit margins are pretty slim. I'm not confident enough in the market's reaction to the production start date being officially pushed right to put any substantial amount of money into it.

But am I confident that LMC will miss its production goal? Of course not. But the hard information seems to only come in the form of SEC disclosures. Everything else is marketing and promises that rely on retaining a shred of credibility.

Looking back

In all, five top executives, including the company's president and its former chief financial officer, sold more than $8 million in stock over three days in early February, according to the filings. ...

One of its executives, Chuan "John" Vo, who oversees Lordstown Motors' propulsion division, sold almost all of his vested equity-99.3%-on Feb. 2, leaving him with 717 shares and proceeds of more than $2.5 million, the filings show. …

Securities lawyers, accountants and analysts say such transactions are highly unusual, particularly because they occurred during a period when many other publicly traded companies bar executives from selling shares.

From WSJ via Matt Levine

Echoing my previous statement about the ambiguity of listing insider selling using nominal values, in this case 99.3% doesn't leave him with much. Of course, it'd be helpful to know what this represents as a percentage of his total holdings - vested and unvested.

Lordstown Week: Monday-Thursday

thebigdeal3717 Stocktwits Lordstown week speed 40mph

Lordstown Week was supposed to be the redemption for fans and speculators - the factory doors would fly open and the world would see that the Endurance is real and very close to production. Some even hoped that the event would be public or open to investors.

It was a closed event. Attendees covered their phones for the factory tour. The prototype trucks were driven by LMC employees at a blistering 40mph.

Lordstown Motors Reddit subreddit investing astroturf hub motors
They'll supposedly be in production in three months. If Ford wanted to steal the hub motor technology (from a video three months before they can ostensibly buy one), they could just buy Elaphe. Perhaps there's a simpler answer to why these cannot be photographed...

For me, Lordstown's viability as a company rests entirely on their hub motors. Everything else is a known quantity and can be resolved with pushed out deadlines and recalls. Likewise, they probably cannot pivot to a traditional drivetrain at this point. So, do the hub motors work?
This is where constistency and credibility matters. "Who cares if they faked preorders?" "Who cares if production dates have been pushed out?" Well, that leaves me less inclined to believe that the Baja racer retired due to battery drain. I'm less inclined to believe the brake manufacturer won't let the truck drive above 40.

But hey, let's see it drive fast with a professional driver on a closed course. Surely the brake manufacturer would permit that; it seems like a critical step to production. Or rollers. Put the thing on a dyno, no braking required.

According to the report, the vehicle was on its first test drive back in January for approximately 10 minutes before the company's Director of Powertrain, Pirakalathan Pathmanathan, said the truck started "driving weird." He decided to pull over, at which point a fire started under the vehicle.

Lordstown claims the issue has been identified, with the PR rep continuing to say, "It wasn’t like the battery exploded, but something went wrong in the hand-build process that led to what caused the fire to start...

Lordstown prototype burned fire truck Endurance Fyretruck

So we hear about the Teslas and Dells where the battery kerplodes and you end up with a horrific roadside barbecue. That doesn't appear to be the case here, rather something went wrong in the (highly localized) driveline that was purportedly caused by human error in assembly.

Hub motors seem great for construction vehicles that drive very, very slowly. They might work at highers speeds with some ventilation. But if you put brake rotors next to them and start driving like a person rather than a construction worker, I'm not sure the math adds up. I'd like to believe the *somebody* did that math before creating a multi-billion dollar pre-revenue car company. I'd also like to believe Elizabeth Holmes did some research before selling the world on the idea of a microwave-size blood test machine.

Reddit Lordstown Motors subreddit astroturfing baja racer
LMC demoed a people mover that was talked up as a "military recon vehicle". Even more hilariously, somehow the Baja truck went from "disaster with a totally valid explanation" to "legend". This is the world of Fyre.

Lordstown Week: Friday factory live tour and Q&A

Lordstown week factory battery

The company did some presentations in front of various stages of assembly.

Lordstown week factory Q and A


/u/whydoineedanamebro
The sound is horrific!!!
Why did't they pre-record this??

I tuned into Friday's Q&A, although a combination of their poor audio, my phone's poor audio, and a brief distraction means I didn't get the whole thing. But here's the synsopsis...
Softballs focused on stamping and paint. Cool. The LMC subreddit had put together a list of questions beforehand, I guess none of them were asked:


/u/BeverlyHills70117
However, one they may answer and is important from our camp... [Investor Relations] has been utterly unresponsive for months, ignoring all emails... the head of IR recently got promoted to the top team, will there be a renewing of the IR team and any consideration of actually answering our questions when possible.

Sure, you've been ghosted by IR, but wouldn't you rather hear about GM's abandoned stamping machine???


/u/SmilingZebra
They haven't asked any of my questions yet, if they answer anybody's from the group, let us all know... Just curious if this is a ruse

The market's response

In a word, 'meh'.


/u/Fit_Cartographer_718
This stock should be popping to the upside not downside. WTF is going on?

I mean, I guess it's because all that happened was LMC drove prototypes that everyone knows exist and saw equipment that everyone knows exists.

The LMC pump playbook

Lordstown Motor Company Reddit WallStreetBets investments

So the fanboys, the astroturfers, and the bagholders converge on /r/LordstownMotors. They rally around the occasional WSB post, all jumping in to downvote skeptics and provide canned responses when someone points out a negative headline. The amusement value has kind of declined as I've seen the script get worn out. Here it is:

Bad news or criticism Canned response My read
LMC claimed preorders that were illegitimate. They've already owned up to that, do you believe Tesla preorders??? There's a lot of 'Whatabout Tesla'. Tesla Carroll Shelbyed an electric motor into a Lotus, proving to the world what they were capable of long before the Model S was even conceived. Let's just run with, "the company lied about preorders for marketing". It has no impact on the technology and it's not like the SEC is going to do anything.
2021 production targets were reduced significantly. Yes but the factory is 85% tooled and 2022 production targets are through the roof! Until they're reduced. That's how this has worked from day one.
The company issued a going concern disclosure that they don't have the funds to operate for another year. This is media FUD! Also there are many promising talks to get outside money. Also they're going to secure a federal loan. Also the factory is worth [think of a number] million dollars! It's funny they still call it FUD when it was a disclosure by LMC. Anyway, blaming the "biased media" stopped being a good look in January. My understanding is the ATVM loan can only be used to supplement other funding, not replace it. "Funding about to be secured" has been a refrain for quite some time. Hasn't happened yet.
The CEO and CTO left/were fired. Burns is an engineer not a CEO and his time had passed, we - I mean LMC - needs someone who can make production happen. This is actually really great news. Huh, Burns was Electric Jesus just a minute ago. Now you never liked him. Still, seems disruptive to have a CEO vacancy three months before production starts.
Ford and GM are going to eat LMC's lunch. LMC is building fleet vehicles, they won't compete with the e-F150. That's almost a fair point, except that I've seen plenty of fleet F150s.
The Baja racer withdrew after 40 miles. That was from abnormal battery draw! They... they hyped this demonstration and showed up to the race without understanding that *racing* requires more battery drain? That's actually more discomforting than if they simply said they broke a hub motor. Anyway, feels like "increased power draw" was the limited hangout for whatever really happened.
Camping World dropped its parts and service collaboration TBD This one hasn't come up often enough to have a copypasta response.

Lordstown Motor Company Reddit astroturfing earnings selloff Hindenburg
So aside from other bearish news like the truck on fire incident, it's pretty simple. Hindenburg reached out to former LMC employees and maybe some partners and vendors (they cite these anonymously). It only takes one with lingering loyalties to loop in Burns et al.


/u/StockGalifinakis
Ask [Lordstown Q&A] if we can expect any more surprises. And if they plan on refuting any of the repeated and false abuse long share holders have endured, with some positive and true PR?

I'd almost feel sorry for them, except they viciously attack anyone who doubts that RIDE = AMERICA = TSLAx100. But hey, at least there's implicit acknowledgement that the company is full of false PR.
Meme stonks

WallStreetBets Charles Payne Dave Portnoy is a little bitch

While Cramer seems to play the love/hate game with WSB, Charles Payne has consistently (well, as consistently as I've seen clips) defended retail.


/u/scorchur
Why does payne sound like he's a dedicated member of wallstreet bets

It's kind of funny that Paperhands Portnoy lost money he doesn't care about during the meme debacle. It's hilarious that some of his probably-just-as-douchey followers did too.


/u/imtotallyhighritemow
It's a popularity contest, Portnoy was brought on to be hated to pump Payne's stock in this community. Portnoy fulfills press appearance contracts with Fox(cash monies), and wsb gets a reason to tune into Payne.

They only care that you tune in, they both make money through your attention not through markets and investments.

Well, Payne might have gone a bit off script with the "little bitch" comment. Yeah the video isn't really all that good, Portnoy continually changes the retail trader group he's talking about in order to paint himself as not at fault or a victim. So it's really just the two talking past each other.

Back to Levine, this time discussing the AMC pants incident and raising market capital in the meme economy...

If you are the CEO of a company that is considering bankruptcy, should you:

Put on a suit, buckle down to sharpen your financial plan, and engage in marathon meetings with creditors to try to hammer out a forbearance, or
Put on no pants and do a bunch of Zoom interviews with YouTube trading influencers where you complain about short sellers?

Option 1 is the traditional answer, but if Option 2 makes your stock price double and gives you enough equity cushion to negotiate with your creditors from a position of strength, what are you doing with pants on? The corporate-finance opportunity set has been dramatically expanded, but not in ... like ... business-y ways? Raising a ton of money at a price unrelated to fundamental value is just a better corporate finance move than increasing your fundamental value would be. It is hard to know what to do about that. Which is why there need to be new textbooks.

Source.
To the moon

SPCE Virgin Galactic covered call investing investment ouch

The tradition continues, I sell a covered call, the company moons (see also: GME, AMC). When I suggested the bull case for SPCE last month, I didn't realize Sir Richard was aiming for a July flight.

Still decent gains... is what I always tell myself through tears. And I had some in my 401k that I converted to cash. Still bullish, but maybe we'll get a dip between now and July.


/u/Chicano_Ducky
This isn't even a fun bubble like dotcom where everyone makes money
This is like being in the upside down from stranger things
Reality shows up and fucks off for no reason
Babe in toyland


Project

Veranda construction yard gazebo roof Simpson RTU2 2x2

I'm still waiting on RTU2s to continue roof construction.

Veranda construction yard gazebo wall 1x4 panel redwood scaffolding

I'm thinking it's best to only put wall sections up where there's a roof, so the lack of roof hardware is slowing everything down. That and the lack of June gloom.

Veranda construction yard gazebo 1x4 saw stain Cabot redwood

Saw, dip, mount. Saw, dip, mount.

Veranda construction yard gazebo redwood roof wall
Gentlemen's Beer Exploration Society rides again


Me
Our March GBES event was bookended with the staff telling us that breweries and dine-in would be shut down statewide starting the following day.

That was more than a year ago. After some backyard, socially-distanced explorations, we finally shouldered through to tourists to visit Hess in Seaport Village.

Hess tasting room Seaport Village San Diego

It wasn't so long ago that Hess was a nanobrewery in Miramar.

Stone tasting room tap list Wuhan Hong Deng Long Red Lanterns beer

We then scooted down to Stone where I felt it necessary to try the Wuhan stout that had been sitting in barrels since 2018.
Remnant fin

Remnant From the Ashes rat cage

J and me wrapped up our DLC playthrough and gave survival mode a try.

Remnant From the Ashes survival mode

Survival is pretty well done. You basically progressively create a build by buying and looting as you run through random maps from the main game. The downside, of course, is that most bosses are really difficult and will end your run in its first round.
Risk of Rain 2/PS4

RoR2 Risk of Rain 2 Beetle Queen Stone Titan bosses gulp

We're now doing a NG+ playthrough of Dying Light with Risk of Rain 2 as our alternate.

Mass Effect: Legendary Edition

Mass Effect Legendary Edition Normandy Citadel flying space

I have a few games queued up, but needing a PS4 option I fired up the Mass Effect remaster. I hold the original in pretty high regard, so I was both eager to give it another playthrough and hopeful that it aged gracefully.

Mass Effect Legendary Edition Eden Prime video reaper
Ah yes, "Reapers".

So what did Bioware do for this post-Shadow Realms/post-Andromeda/post-Anthem cash grab? Here are the relevant pieces (per me) taken from IGN who copied them from the official site:
This all sounds great, not crazy-ambitious but more than superficial. So, how does the game hold up? How substantive is the remaster?

Mass Effect Legendary Edition intro text
... Warpy McGateface

Mass Effect - like other Bioware RPGs - is about two things: worldbuilding and dialogue. While the playable geography isn't massive, ME is set in a universe that is detailed and expansive. There is substance below the surface; the game isn't a collection of environments with baddies.

Mass Effect Legendary Edition Shepard M7 assaut rifle combat Eden Prime

The retrofitted combat system is pretty good - it's not nearly as frustrating as I remember it. It's far from perfect, but my biggest gripe is how finicky it is to get in cover (and this is a cover shooter, btw). Still, being able to pause combat using the ability and weapon wheels makes the rough edges totally manageable.

Mass Effect Legendary Edition Eden Prime combat Geth husk butt tramp chip

While combat was never a highlight of the game(s), the lack of enemy variety does stand out in [current year]. Games like Gears of War and Borderlands have distinct and memorable classes of baddies, ME1 enemies are either melee or ranged with weapons or powers. While I'm not looking for forced variety - Elcor toting miniguns for some reason - it does seem like *my* combat tactics don't really differ regardless of what is downrange.

Hmmm, on second thought give me the Elcor with miniguns.

Mass Effect Legendary Edition Eden Prime artifact Shepard

The upgraded(?) backgrounds are pretty neat. Full marks.

Mass Effect Legendary Edition Shepard Nihilus Turian SPECTRE

Mass Effect - like other Bioware RPGs - is about two things: worldbuilding and dialogue. While some of the voice acting is subpar by today's standards, the conversations are almost always worth listening to. Sure, I mash the skip button as soon as Ashley opens her mouth, but Garrus's walking test tube story is great and I forgot how much I missed Morlan's famous shop.

Mass Effect Legendary Edition engine room Normandy Tali

Some of the dialogue mechanics are a bit rough. "HAI TALI, WE JUST MET BUT TELL ME ABOUT THE MOST TRAUMATIC THING THAT'S EVER HAPPENED TO YOU!" That's a bit hyperbolic, but there are a lot of expository dialogue trees that are accessed in the most inorganic ways.

Mass Effect Legendary Edition Citadel elevator Garrus Tali

I guess the Xbox 360 elevator load times were upwards of 50 seconds. How did we manage in those days? For the remaster, you can skip through these sequences or listen to the signature elevator banter. And I've always enjoyed that the elevator news announcements are voiced by the same guy who did Beyond Good and Evil (pretty sure, anyway).

Mass Effect Legendary Edition Nihilus Shepard film grain depth of field photo mode

The remaster adds a photo mode with a slider for glowiness.

Mass Effect Legendary Edition Citadel Presidium Mass Relay
Is this thing on?

I forgot how much you get to wander the Citadel after completing the prologue. It very much is the centerpiece of the game, as it is the nexus of both the ME galaxy and its plot. Any amount of tedium that may have resulted from Xbox 360 load times is gone from the remaster.

Mass Effect Legendary Edition Citadel Volus ambassador Din Korlack

And so the Citadel offers entertaining interactions with also-ran aliens complaining about their parochial issues and political frustrations. All of this can be bypassed, but it's considerably more enjoyable than a Fox News town hall debate or some drama about a vaporware truck company.

Mass Effect Legendary Edition Turian Quarian Tali alley Shadow Broker

And while the Citadel's fancy areas are all robed ambassadors and well-tended gardens, it has unsavory areas with crime and gentlemen's clubs and money-skimming AIs. So the Citadel allows some opportunities to exercise your license to kill.

Mass Effect Legendary Edition turian Saren artifact Eden Prime

So ME offers a pretty neat universe with colorful characters and it's become modestly prettier with the remaster.

Mass Effect Legendary Edition Eden Prime husks impaled colonists

And it tells a good story (iirc written by a sci-fi writer) landing somewhere between space opera and hard science fiction. The first one has a good story, anyway.

Mass Effect Legendary Edition Normandy navigation Ashley Garrus Wrex

Gripes?
Rest in peace...

... Cyber legend John McAfee



/u/Bovronius
As I said to someone else... Touting your conspiracy that the government is going to kill you and frame it as a suicide but then actually committing suicide is about the most John McAfee thing I can think of doing... You know that and getting pooped on from a hammock.

Reddit John McAfee career antivirus whale sex banter

... Google Hangouts

Anyone else's Hangouts yelling at you to move to "Chat in Gmail"?
Kevin
What are the chances hitting this button does not ruin everything?
I'm not even sure what that does honestly.
Sants
My hangouts app isn't asking me to switch.
Although, I have the chat app on my work profile.
It's just a new UI.
Alright, I've got the Santos seal of approval. See you on the other side. Maybe.
Kevin

Chris
Godspeed.
And you can edit your comments, finally.
Sants
You can stay in these same rooms.
Sorry, are we calling them 'rooms' now?
I'm back. This chat window looks like shit.
Kevin
Yep, no edit functionality on iPhone so that statement stays as is.
Hmmm.
Sants
If you hold down?
Nope, all I can do is add a stupid reaction.
Kevin

Chris
Laughed at "Nope, all I can do is add a stupid reaction."



2021.06.15

Draft Kings Hindenburg research WallStreetBets short

So I previously talked about being a huge fan of vaporware and the figureheads that hype them. This weekend I even rounded out my '08 crash trilogy with its Enron prequel.

Jeffrey Skilling Enron testimony

I highly recommend the documentary though I should say that the wiretaps of Enron traders joking about exploiting the recently-deregulated California energy sector is a tough listen. Anyway, while Kenneth Lay and Jeffrey Skilling didn't have the social media polish (or the existence of social media, for that matter) that Elizabeth Holmes and Billy McFarland did, they had all the "fake it til you exit" gusto.
Hindenburg Research

WallStreetBets Hindenburg research DraftKings astroturfing

I first read a Hindenburg writeup last year when it revealed that Nikola's prototype truck "in motion" was actually just rolling down a hill. And some other stuff. It's a pretty good read and has largely or entirely been validated since initial publication.

While it may come as a surprise to GME squeeze-era Reddit accounts, Hindenburg discloses its short positions and writes "hit pieces" that may drive the short positions rather than justify them. The more recent Lordstown report pairs nicely with my running chronicle of their Reddit astroturfing and was rewarded with this week's ouster of their Billy McFarland, Steve Burns.

WallStreetBets Hindenburg research DraftKings astroturfing SEC Rshackleford22
I mean, Rusty, thanks for pointing that out but only bots and newbs think this is a revelation.

Indeed, this puts Hindenburg's short research at odds with the very-very-artificial notion that WSB is about taking down shorts and putting institutionals against the wall. These astroturfing campaigns have three levels of hilarity, each more significant than the last:
  1. Finance-sector marketers are so oblivious that they don't understand how to correctly manipulate Reddit.
  2. Reddit is so unable to manage fraud that the dumb finance-sector marketers easily dominate the conversation and create the zeitgeist, rather than steer it.
  3. I observe/lurk, looking for legit DD and meme stonks, then write about bots "not getting it". Lol.
WallStreetBets Hindenburg research DraftKings astroturfing SEC DiBalls
Whoa! If only they disclosed this, /u/DiBalls, account created during the GME sqeeze.

Finance citizen journalism

WallStreetBets Hindenburg research DraftKings astroturfing

Having read a small sampling of their work, Hindenburg's MO seems to be to call up former employees to find leads and then validate them with open source research and FOIA requests. While this is only as sophisticated as "a needledick with a wifi connection", that makes the work pretty easy to validate/replicate. As far as I'm aware, Nikola's gravity drive system wasn't widely recognized until Hindenburg published it.

And since the Nikola saga predated the January 2021 GME squeeze, it's not widely understood by bots. They jump in the conversation and say "burn the hedgies", not realizing that the Nikola piece saved a lot of WSB money and - more importantly - generated several high quality memes.

I enjoy the Hindenburg writeups, in part because they are very approachable and lack the "I'm in finance, you wouldn't understand" attitude that's common in the industry. Is their simplicity probably a way to reach both institutionals and retail to maximize impact? Probably. But to echo the common investing refrain, "do your own research". The Hindenburg hit pieces provide most of their source material (save whistleblower identities) rather than simply say, "Trust me, my investment firm is worth $x billion."
The Eye of Sauron turns to Draft Kings

Hindenburg Research Draft Kings Eye of Sauron Lord of the Rings investing

It wasn't hard to be on board with the Nikola and Lordstown pieces, especially after each company responded with rhetoric and reorgs. The new one is about Draft Kings. Unlike the previous refrains of "this is vaporware", the DKNG piece has a little more nuance. My TLDR of the Hindenburg contentions:
Right away, this isn't the smoking gun of "that truck wasn't driving itself" or "you talked about $12M preorders from a guy working out of his garage".

Black market connections

From the writeup (emphases mine):

Based on conversations with multiple former employees, a review of SEC & international filings, and inspection of back-end infrastructure at illicit international gaming websites, we show that SBTech has a long and ongoing record of operating in black markets.

This is basically the crux of the first point. DraftKings merged with SBTech (an international sports betting technology company). Upon smelling US exposure with recent SCOTUS cases, SBTech decided to push its partnerships with illicit clients to a spinoff, BTi/CoreTech. Bots will ask for a "smocking gun" but, for me, the evidence is damning enough for trading:
This comes with a slew of connections to triads and shipping-container gambling site hosts and binary options trading scams.

As an investor, one has to ask, "does this matter?" I'm not sure. Here are the risks to a DKNG position that I can think of:

Fundamentals

Continuing with quotes from the writeup:

Insiders have dumped over $1.4 billion in stock since the company went public a little over a year ago, with SBTech’s founder leading the pack, having personally sold ~$568 million in shares.

These numbers might matter to me if I did more research. As they are, these numbers don't mean a lot. I'm (perhaps falsely) conditioned to a system wherein execs are constantly receiving huge stock grants and regularly sell large tranches as a primary or supplementary income. I'd also expect a C-level employee to convert a lot of shares to cash after a SPAC merger since, you know, it lets them enjoy/diversify their new wealth.

Now, if you told me that Shalom Meckenzie liquidated 80% of his DKNG holdings and had no more coming in, I might be inclined to believe he was skittering from a sinking ship.

We spoke with several industry experts and competitors who questioned the viability of DraftKings’ model of aggressively burning cash on promotion and marketing to acquire customers in the near term, despite a lack of evidence of long-term customer brand loyalty.

Lolllllllllll reachingggg. You guys have heard of Amazon, right? Or any other company that operates at a loss to create a user base. Uber. Ant. Pied Piper. I'm not saying it's a great business model, but it's certainly worked enough to not be considered an investing black mark - especially when you're trying to create a user base in a new(ly legal) market.
Astroturfers, do your thing

WallStreetBets Hindenburg research DraftKings astroturfing SEC KingMonkey777

As usual, four month old accounts tell fellow Redditors that this means there's squeeze potential.

WallStreetBets Hindenburg research DraftKings astroturfing SEC taztapftw

Credit Suisse, cool. They ate a huge L on the Archegos thing and, well, fresh in my mind is their negligence in the Enron thing.

WallStreetBets Hindenburg research DraftKings astroturfing Credit Suisse
GME-era account vs real account.

WallStreetBets Hindenburg research DraftKings astroturfing SEC sans_serifs

Maybe Draft Kings should consider civil action against Hindenburg.

WallStreetBets Hindenburg research DraftKings astroturfing trading123456

/u/trading123456 may just be DKNG's /u/DawgPound98. It's hard to say if his mil invested in DKNG is real or paper since he's been around since... *checks notes* the GME squeeze.

WallStreetBets Hindenburg research DraftKings astroturfing trading123456

He's a bit short on anything that isn't personal plaudits/attacks, but at least he knows the correct use of you're/your.


Jon
Feel free to translate out of Reddit stockbro speak.

Dammit. Uhhh, this is not investment advice.
Also

Hilti tools casual flex

Putting up the 2x2s is slow, slow work.



2021.06.13

Reddit WallStreetBets dad jokes bouillonaire Griffinhunters Guitar_Strap
Construction

Lumber wood 1x4 2x2 redwood construction stain application paint sprayer

The Kevin Smith's Ankle Memorial Palapa has also received the apt nickname The Baby Stable. With the supporting structure built, the wall and roof materials arrived.

1x4 fence bracket horizontal mount

In a projectwide effort to minimize wood-screwed-into-wood, I bought and prepped 1x4 mounting brackets for the walls and Simpson RTU2 2x connectors for the roof.

Lumber wood 1x4 redwood construction

Once again I pulled out the paint sprayer for the 250+ pieces of redwood that arrived by flatbed. While the structural pieces are pressure treated, for these prettier planks it made sense to use clear(ish) Cabot stain.

Lumber wood 2x2 staining redwood construction

Since the stain absorbs pretty quickly, I worked out a system for applying to 2x2-12s without requiring insane amounts of space. Spray, wait, turn, spray. Each layer could then be leaned against the joists to dry. The 'wait' bit was actually spraying 1x4s in groups of six.

Lumber wood joist tape veranda Trex

The structural pieces are somewhat visible from the deck and top terrace, but in the interests of longevity, I applied Trex joist tape to take the brunt of the sun and rain.

Construction veranda 2x2 roof plum line

For the roofing, I figured I'd do a very plum first row of 2x2s and offset the rest with a spacing template.

Lumber wood 1x4 2x2 stained roof redwood construction

It should look pretty good when all is said and done.
Memes surge and the battle for the soul of WSB continues


/u/_Jellyfisher
Going through [the daily] thread is like walking through a bazaar and everyone shouting at you at once to buy a rug or a necklace or a fish...

WSB has two things in abundance:
Cool cool cool cool.

The sub's signal-to-noise has tanked like a SPY put. What's worse, the bots upvote each other so you can't even sort by quality. Mods finally implemented a few reactionary measures, moving popular tickers to a megathread and banning the word 'squeeze'. It's more a symptom of Reddit's larger authenticity problem, but it's allowed *some* good material to poke through.

WallStreetBets Reddit ChartExchange crayon candles

... like crayon candles and advice on hallucinogen consumption during trading.


/u/Ok_Kangaroo55
Word to the wise: do not eat mushrooms during market hours and assume you can see the future.

Stonks chat

Chat buy dip AMC BB meme stock

On the blue-check-verified trading chat, I think Zac and Kevin are mostly just watching LTNC move between $0.00001 and $0.00003.

BlackBerry BB COIN Coinbase positions bagholding covered calls

I'm still doing my thing; selling calls on meme stonks, betting on energy, and bagholding Coinbase in the hopes that covered calls get me back to even.

Reddit WallStreetBets SaltyBrotatoChip consequences
A little more socializing

Photo collage party

With the gradual demise of covid, Gage had a birthday party, KO met me for beers, and Danielle ate a caterpillar and touched a Starbucks cup with confidence.


You just want me to get fired so you have a live-in nanny
Rob

Chris
Haha imagine.
I'd be a great nanny
Slaps kid's hood* you can fit so many cheeseburgers in this thing
That's not... I can't...



2021.06.02


I tried to think of a better title - I really did. It's bad now, but in a couple years I'm going to say, "A portmanteau *and* that word we no longer use, spluh". But, like, that's what it was. Memorial Day weekend and then the memening of GME, AMC, and BB. There's no other way to describe it. I'm sorry but I will not apologize.

Anyway, we headed up to Poway to check out the new Cooley backyard and enjoy some burgers.

Poway California Trump flags Memorial Day

Naturally, there were some MAGAs on the street corner. I'd think any other day would be more appropriate for a political rally, but I can't blame them for wanting to be outside. Now bring on the June gloom!
Project

Veranda sheer support wire rope steel cable

I added steel cables for sheer support. Having suffered through cutting the cable with bolt cutters for many years, I finally got the tool made for the job. It's terrible. I'll have to invest in whatever the commercial version is rather than the hand tool that was the only option at HD.

Veranda sheer support steel cable footers Simpson Strong Tie bolts

The strong tie bases are great for eye bolts. I didn't originally plan for this (instead getting regular bolts), but the changeout wasn't much work.


After ten years of sun, rain, and pool-adjacency, my galv deck post bases show no signs of corrosion. Still, some of the wood joining brackets are not galv so I hit them all with spray paint. My understanding is that spray paint's achilles heel is abrasion, and that shouldn't be much of an issue here.

To go one step further, I used dry teflon tool spray that is supposed to be good against corrosion. It might not endure UV exposure and rain for an extended period of time but is fairly cheap and easy to reapply - it's clear so there's no masking or cleanup.

Walls

For the walls I settled on cleaning the county out of 1x4s, at no small cost to myself.

Shiplap facia trim support
LP SmartSide fascia installation information highlighting common max spacing.

After researching a number of different products I found that most horizontal fencing/siding systems are solid (e.g. shiplap), require support every 24", or both. This left just redwood 1x4s or 1x6s that could span the 8' with a little help at the halfway mark.

Roof

For the veranda top I went with the standard 2x2 wood beams you see on most such structures. I had a few other ideas...

Veranda roof ideas clear polycarbonate

I grabbed some half-round and hollow square acrylic pieces from a local plastics supply. They actually look pretty neat and might handle looking grimy okay. Acrylic was in budget but I wasn't sure the UV properties would work out. I didn't follow up on looking into polycarbonate equivalents.

Acrylic polycarbonate sheets colors

I also considered a stained glass look with gaps between rectangular tiles.

Veranda roof idea 45 degree 1x4

Another way to go would have been 1x4s or similar affixed at a 45ish degree angle.

Home Depot Ironwood galvanized wood ties 45 degree

Unfortunately there was no hardware for this. The closest brackets I found were not for sitting atop a 2x6. The angle could be accomplished by cutting 2x2s into triangles, but it wouldn't look nearly as clean as an almost-flush metal bracket.
Dishwasher

YouTube dishwasher repair video Kenmore impeller

Since suffering the embarrassment of installing a new garbage disposal without punching out the dishwasher punch-out tab, I've gone half-Ahab on a new issue. The rinse cycle doesn't completely drain and it shows some sort of prehistoric error code wherein the Favorite Cycle Set button flashes and other buttons don't work. Kenmore 66515972990 dishwasher, to be specific, though I guess it's just a rebranded Whirlpool.

YouTube was semi-helpful, though it seems like every dishwasher is completely unique and has no exact twin anywhere in the world.

Kenmore Whirlpool dishwasher impeller removal fail

To get to the filter/drain area required removing the impeller. This is the standard screw-attached-to-spinny thing situation where you need to grab the thing that spins and unscrew the screw. In this case, it was a very, very seized screw and a soft plastic impeller.

The replacement didn't go to badly. I then inspected the electronics to find nothing visibly amiss. Fingers crossed.
Vine Street Bets

Marketwatch diamond hands vernacular GME Reddit WallSteetBets

GME is back in the high 200s and holding strong. Or "HODLing strong" as the kids say.

CNBC AMC 02 June 2021 meme stonk on the moon

Meanwhile, after months on life support, AMC (a fringe meme stock from January) went on a moon mission to $65 in the span of a couple days. If it's anything like GME, this is because I sold covered calls on my 300 shares, going with longer expirations to make them worth the button press.

CNBC article AMC free popcorn retail investors memes

Perhaps this is a new era of raising capital - pander to retail. I'm told AMC also donated to the Fossey Gorilla Fund.

I guess the other strategy is to shoot the moon with short interest.

CNBC BlackBerry 02 June 2021 meme stonk

The remaining JV meme stonks are BlackBerry and Nokia.

Seeking laughs

CNBC partner advertising fear uncertainty doubt meme stock fundamentals

I still use CNBC for their quotes/charts and couldn't not check out their clickbait link to a Seeking Alpha article. I was pleasantly rewarded.

Some quotes from AMC: Hedge Fund 1-0 Reddit Army (emphases mine)...

AMC issued 8,500,000 shares for $230,500,000 to an investment firm named Mudrick Capital Management, LP.

AMC said that it will use the proceeds from the capital raise for the "pursuit of value creating acquisitions of theater assets and leases, as well as investments to enhance the consumer appeal of its theaters".

Makes sense so far. Pretty sure stocks are ways for companies to raise money for business ventures. AMC needs this as much as anyone else. The new offering should surprise no one, GME did it.

However, the price reaction literally makes no sense given that the firm announced a capital raise, which increases the number of shares. As more shares are issued, the firms EPS is poised to decline as earnings are distributed over a larger amount of outstanding shares. The reaction to a capital raise is typically for the share price to fall, not to increase.

The dumb version of 'literally' can't have made its way into mainstream journalism. Is this a blog post? Anyway, weird to be discussing fundamentals in a post about a meme stock. Also weird to describe stock dilution first in EPS terms when you can just point to the very approachable concept of supply. Or maybe that was a deliberate choice because it would lead the reader to think about that other economic force that's often mentioned with supply.

Mudrick Capital Management is said to have already exited its position in AMC after making a quick 20% on Tuesday... the whole thing was really just a quick flip as the investment firm offloaded overpriced shares to retail investors...

Kind of a sweet deal for Mudrick. Checkmate, Redditors.

The risk here is immeasurable because neither the price action nor the valuation makes any sense for AMC.

AMC's price should have gone down yesterday, not up because a capital raise is dilutive... but nothing makes sense anymore when it comes to AMC.

AMC is trading independently of its business numbers and growth prospects and the risk of losing everything in this "investment" is extremely high.

This is gone from "I'm continuing to be surprised by one of the things my article is predicated on" to sounding suspiciously like the concern trolling we saw in January from institutional investors making public appearances.

A hedge fund just had a big victory and nobody seems to notice or care.

:'(

You literally had a hedge fund flipping its stake in AMC to the Reddit army at a massively overpriced valuation and explicitly calling AMC "overvalued." It can't get any more brazen than this. Please be careful.

Another dumb 'literally' and breaking the fourth wall at the very end? Is Seeking Alpha like a financial Geocities or something? I'm not super familiar with the site but its name is thrown around often enough.

It's a lot of words to say "meme stock is memeing, if this is unfamiliar, stay away and read about GME".

Anyway, the peanut gallery gave me a giggle:

Commenter Comment
Jstic After today, it looks to me like Mudrick made a multi million dollar mistake. The amount of money they left on the table is probably getting some people fired.
mattgrim81 Not sure why you posted this today after the stock soared 100% extremely bad timing ??
Mark Roussin Well this was unfortunate timing
Christopher Brady Morris This aged well.
RetailinvestFTW Mudrick capital lost over 300 million in potential gains if it had just held 1 single trading day
MIKEC100 People seem to be getting a little nervous here
Checkthenumbers Time to update the scoreboard.

Halftime score:
Team Hedge Fund 1
Team Reddit 0

Final score:
Team Hedge Fund 1
Team Reddit 62.55

Options trading via The Brocratic Method

A recap of the recent AMC saga, some info about selling options, and other commentary:

I optioned off my 100 [AMC] shares at 27.
Kevin
Got 500 bucks so I am still ahead even if this executes. At least for the time being.
Chris do you have a minimum you sell options at? On the one hand I feel like I have these shares doing nothing so even 50 bucks is something. On the other hand it's work.

Chris
Yeah that ITM call win-win is so nice.
My price floor is augmented by the slight tingling sensation in my loins so it's $20.
But I try to shoot for maybe 0.8% or more on the weekly return.
Plus it's only a weekly exercise. And you can always go longer-expiration or more contracts.
If it's say $20 it's probably a $10-30 stonk, so you could have a 500 share position.
That's where I was lazy for a bit and just put my 50k active trading money into NVDA. One contract per week.
So you stick to 1- or 2-week contracts?
Kevin
Yeah I do 1-2 weeks to limit my exposure if there's a rug pull.
And cause I like gambling.
Mostly.
Oh man NVDAs got some sweet options.

Chris
Haha look at COIN and GME :D
I have 2022 and 2023 contracts for NOK and ERIC and some fall ones as hedges (US dollar inverse, volatility, etc).
Man $3,000 contracts for GME. Only need to pony up 24k to get started on that.
Yeppppp, could do a single day thing and limit your exposure.
Open today close tomorrow and take 1k.
Or open Thursday and go til expiration.
Wait how do I close? I can't back out of my current contract, I would basically just need to buy another 100 shares.
Kevin
Open and close is just a way to address the fact that you can either do a buy-sell or a sell-buy
So if I sold a put on COIN today for $200, I could wait for it to expire/assign. Or I could close it buy buying the same put for (hopefully) less tomorrow. I won't make the full $200, but it'll let me exit the position with profit and free up the cash I used to secure the put.
Or say you sell a call on your NVDA. You bought at $600 and sell a $610 call. If the price moves to $590, you could buy that call back for cheeeaaaap cause it's less likely to expire in the money *and* theta (time decay) has also devalued it.
Ohhh interesting. So really you could just play the options market as things go up and down as well. But I assume the options pricing is highly correlated with the price of the stock itself.

Chris
Yes and yes. Basically the movement of the underlier (stock/equity) determines the likelihood that the contract will expire in the money.
The percent chance of being ITM is called delta and your brokerage lists it though I don't know how they decide it's legit.
So yeah, you can trade options like daytrading equities, except there's more volatility.
For us, it's about closing a position that's made (or lost) *enough* money to justify taking lower gains in exchange for eliminating risk. Colloquially, paper handing it.
Riding it til expiration would called diamond handing it.
Selling options on your long stonks is cutting off your trip to the moon.
Zac
It's true except when they don't moon and just sit and do nothing.
Kevin
AMC is not a "sit and do nothing" stonk.
Zac
It's a meme stonk.
It's either going to the moon or going to zero.
Tell that to AMC for the last four months.
Kevin
I mean I keep telling myself I probably would have just sold it anyway by now.
AMC trading has been halted.
That's how you know you have reached true meme status.
Things to see and nom

Scotty Dog Sophie Giraffe

Scotty and Sophie sent Lil' Dani some appropriately-chosen toys - a scotty dog and Sophie the giraffe.


The mobile is pretty good entertainment, hopefully the mural will soon be contrasty enough to warrant attention.

PUBG

PUBG quad ATV Miramar update

PUBG renovated Miramar, adding an ATV and anti-materiel rifle. The graphical model updates aren't bad, but like the Sanhok update somebody thought it'd be a good idea to crank saturation up to the max. It's painful on the eyes.

PUBG Lynx AMR
Getting older

Custom tyrannosaurus rex slippers

I'm older now than I was before. In celebration, Jes made me some one-off t-rex slippers to supplement/replace my mass market t-rex slippers that weren't very well made.