I had a leisurely Sunday lunch with some friends yesterday.
Before the meal started, I asked the waiter to be sure that I received the bill (it was my turn).
Yet, to my great dismay, as we were finishing our lunch, the waiter had informed me the bill had already been paid.
I would like to speak to the manager!
But while I was a bit peeved with my do-good lunch companions, I realized how fortunate I am to have such generous friends.
This episode also made me wonder … who is picking up the tab for the USA?
Sadly, it seems Congress is not concerned about that when it comes to the infrastructure bill announced this week.
One side claims they didn’t know about the “terms of the contract” i.e. the secondary agreement.
The other side says there is no way they can agree to anything unless the supplemental second package is attached.
Meanwhile, the head honcho was out declaring he wouldn’t sign one without the other.
The bill is expected to cost $1.2 trillion over eight years and, quoting President Biden, it’s “the largest investment in rail since the creation of Amtrak.”
Um, Amtrak hasn’t made a dime since its inception in 1971 — and received $8.1 billion in federal assistance between 2016-2020 alone.
Now, after a good meal like I had yesterday and when I’m feeling stress (brought on by profligate spending, in this case) I like to work out.
So I hit the gym last night and that got me thinking …
Trade Idea Alert!
Check out the chart in Lululemon Athletica (Ticker: LULU):
I think LULU is primed for a quick pullback with Friday’s doji.
If LULU opens and trades lower today, I will look to buy put options in the July 02 expiration cycle.
I like buying the July 02 360-strike puts with an implied vol of 22.69 and selling the 350-strikje puts with an implied volatility of 26.40.
As you can see the markets are pretty wide without much volume:
But I think I can get the spread on for around $2, which seems a bit expensive, but LULU did trade at $357 just last Wednesday.
I’m looking for a quick sharp pullback to make money on this trade as it expires on Friday.
I will take profits at $3 and above, and exit with my loss if the spread trades down to $1.40.
Thanks for Reading … See You Next Tuesday!