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QUADRUPLE WITCHING IN DISGUISE…

It always amazes me how seasonal trends in the stock market are hidden between the lines of distraction. Here is what I mean. Everyone knows or has heard about quadruple witching.

This is when stock options, stock futures, stock index options, and stock index futures expire on the third Friday of the last month of the quarter. 

This is a period of rotation, position unwinding, and high volatility, so it’s not uncommon to see a sell-off in different sectors of the market.

You also have what is called window dressing. This is where fund managers sell their losers in the quarter and buy the companies that outperformed in the same quarter to give the appearance that they owned the winners. 

This charade comes out in the wash because, although it’s a blatant lie, they don’t have to file what they own until 45 days after the quarter closes.

They could possibly buy the stock on the third week of the month and sell the position the day after the quarter closes and not file the 13 F report until the final day or the 45th day to meet the disclosure requirement. 

These are the games played on the street to fool the investment public, and although it’s perfectly legal, it needs to be exposed. 

Now that the air is clear, ask yourself a question. When, if you managed hundreds of millions or even billions of dollars would you start unwinding your losing position and buy the winners?

Would you start unwinding and repositioning at the last minute when it’s already a crowded trade or would you start early? Look at the Dow on February 5th. It peaked at 44,873.54 and ironically, it’s down 7.5% to 41,488.19 on March 15th, with one week until quadruple witching, which tells you someone started early. 

Now, in this time we’ve had the recycled story of Deep Seek hit the market with a bogus Chinese propaganda story that started the tech spiral. This was extremely helpful, as it provided cover to sell. 

And of course, there were the tariff shocks to the system, that also disguised the institutional actions or intentions, while simultaneously distracting the entire retail trade. Here’s what I mean. In order to sell stock someone has to buy it and vice versa.

So, if you are scared enough to sell your position, think about the anxiety that goes with losing money and then think about the action of selling. While you might be selling in excruciating agony the person that’s buying has to be screaming in absolute joy. 

This is the part where you become the liquidity to the downside for those looking to short the market and go long at potential liquidity levels. It’s all just a game of cat and mouse and most of the time the cat is a Wall Street lion, and the retail investor is an undomesticated mouse. 

The unwind and reposition was beautifully coordinated and executed with precision because the headlines and misinformation provided an opportunity to sell and buy at levels to create the illusion that fund managers were winning, when in fact. they got their asses kicked with the perception that they were buying low at the same time. 

This is why I preach long-term investing because time is truly undefeated. Time will outlast your emotional moments and teach you patience. Time will also reveal a horrible investment. 

So, if you are someone who picks your stocks from social media, time will definitely teach you a lesson about why that’s a fool's exercise. 

Think about it. How secure can you be if you never did the research? This is the type of insecurity that has you looking at stocks every day staring at the sell button. This is how you became emotional in the first place. 

Not having a true understanding of how the inner parts of research work and taking financial advice from a social media person who’s never held a license from day one—a recipe for lost time, lost money, and panic. 

Remember, things aren’t always what they seem and there is always an ulterior motive behind what you are witnessing. Your only problem is you sell before you find out that it was all orchestrated… 

WHY GO BROKE EVERY FRIDAY…

I’m sure when you look at the financial situation of the Tyson and the Holyfields of the world, you snicker to yourself and say, “That could never happen to me,” when in reality it happens to you every week. 

The fact is, people go broke every payday. And it’s all relative…whether it’s millions of dollars or thousands;  if you spend one hundred percent of your income, whether weekly or biweekly, you are the pot calling the kettle black—which makes you no better than them. 

I used to be a victim of my wants and like a person with a bad gambling addiction, I convinced myself that what I wanted was what I needed. 

I became a stockbroker in 1995 and as a stockbroker, you were paid once monthly. Before I even received my check my bad habits would take over and attack every red cent. 

I would take extravagant trips, have expensive dinners, and spend money on just about anything and everything I wanted. I became the biggest clothing horse in the barn and enjoying a lady’s company often meant I was her sponsor for the evening, meaning…she paid for nothing. 

And why not? I was surrounded by nothing but testosterone and some of the biggest swinging dicks on Wall Street.

Money was no object and obviously, I didn’t practice what I taught my clients when it came down to investing. To be brutally honest, I was having too much-unadulterated fun living on the financial edge with the thought process of “F it, you can’t take it with you.”

It would take me a decade and a half, two occupations later, millions more dollars blown, a child and a wife, for me to stop disrespecting my income-earning years.  Here is what I mean…you are in your income-earning years from the time you enter the workforce in your 20s ‘til the age of retirement. 

As you get into your 40s and 50s, you are in your peak income-earning years—because if done right, you are still healthy and strong enough to earn enough money to finance the rest of your life. 

Once your health goes and you’re not physically able to work any longer, the gig is up. 

What caught my attention was the death of my high school and childhood friend Anthony Mason, the former New York Knicks power forward. He suffered a major heart attack and died from congestive heart failure at the age of 48. We were the same age at the time. 

I started to reflect on my life and its true purpose and realized that I had hustled and grinded away some of my best years and still had no children, no wife, or money to show for it.

At this point, I realized that everything I needed to build wealth was right in front of me the entire time. 

I had transitioned into the life insurance business as a stockbroker. I was taught how to make a decent wage and how to make money grow, but never thought to do it for myself for half my career as a stockbroker—because I was still a part of what I like to call the old economy, where money was made to be spent. 

Let’s conceptualize it. In the old economy, the purpose of your dollars was to enrich those who promoted consumerism, meaning…for every dollar being made, there was an equal and more powerful advertisement pulling on your dollar like a magnet. 

But it was covertly and clearly done by attacking your emotional center. In order for it to work, the advertisers have to make you either feel secure with a product or insecure without it.  

This is done by emotionally attacking your wants and needs through every form of media until your needs evaporate and all that’s left is your greatest desires, which masquerade as your wants. 

At first, the only medium they had to infiltrate your wants was through radio, television, and billboards. And then they stepped their game up in 1990, when computer scientist, Tim Berners-Lee, invented the World Wide Web.

This would eventually mean we would be outflanked by advertisers on all sides of the internet. But if it wasn’t for Martin Cooper who invented the mobile phone in 1973, inspired by Star Trek, there would be no surfing the internet on our cellphones, which became the rage at the start of the new millennium. 

We wouldn’t be sleeping with our cell phones in our beds afraid we would miss the next juicy text or Balenciaga sneaker advertisement. 

You cannot walk anywhere in a crowded metropolitan city without people glued to their cell phones, and now that the advertisers have you, your dollars can’t avoid their ever-increasing reach. 

Advertisers know that your weaknesses would create your bad habits, so they make you insecure without them. They understand the true value of low self-esteem because you will spend every last dime to either cover it up with designer clothing or drive over it in a brand-new Mercedes. 

They also have your deeply ingrained systemic playbook and know that your financial ignorance renders you powerless because you have no seat at the financial table. 

In most cases, you don’t grow what you eat, you don’t manufacture what you wear or drive, and it is your ego that makes you overstate your false confidence, which is as slippery as the control you have over your life.

To them, you are nothing more than a silly little consumer that’s on the tit of their double D-producing mammary glands that will suck up any product that they manufacture, just to keep up with the Joneses. 

I painted this picture to bring to light that if you are constantly spending your money on things that don’t matter, you are squandering the future legacies of your families. Surely Apple iPhones and Facebook aren’t going to cut you the check to build your legacies; in fact, you helped them catch an enormous check to secure theirs.

And it was all done by hustling backwards expecting a forward result in the old economy. 

As an insurance agent, I became intimate with this understanding. I would be in countless homes and recognize frightening similarities in financial behavior.

The most scary thing is no one knew what their free cash flow was, which was all the money left over after the bills were paid. 

This was frightening because if you don’t know what this number is then the impending question is how the hell do you retire? Because if you aren’t identifying the monies necessary to have a secure future the cold hard facts are that you will not have one. At least not one worth living. 

My heart always went out to my clients, so I would suggest that they take their last year of bank statements and itemize them to identify where the stupid tax was…meaning all the money spent on stupid things disguised as life’s necessary pleasures. 

It always surprised them that after we did a cash flow analysis after adding all their bills together they had excess money left over. 

I would always ask them if they recognized the unaccounted-for funds by showing them the calculator as they stared at the number like it was a missing persons poster, surprised by the findings. 

I would always inform them that they had enough to build a retirement. So here’s what I discovered. Most people I met with had between $500 to $2,000 of free cash flow monthly. 

I would give them an example based on $100 dollars saved monthly for 20 years at a compounded interest rate of 8%. 

First, I would do basic math by asking them how much is 12 times 100; they would all respond 1,200. Then, I would ask how much is 20 times 1200 and some would break out their calculators but most would say 24,000.

Then, I would drop the bomb on them by saying that if they were able to achieve 8% compounded interest over the same 20-year period the $24,000 figure would inflate to $59,307.51 which was a 247% return. 

Their eyeballs would always pop and then I would say, if you put away 1000 dollars a month or 250 dollars a week at the same returns it would be worth $593,075.10; then their jaws would hit the floor. 

What I found was that many people wanted to invest but not many knew how. 

For most, they would go broke every payday slaving to a materialistic mindset that was cleverly hidden in plain sight between their text messages and phone calls. It was called e-commerce of which they were the consumer. 

I would speak of a new economy where retirement was a sure thing if they monetized what they patronized, which all was centered around the products and services they knew and used every day. 

And get them to ponder the question, what if you had invested in only three of these companies, while simultaneously using their products and services? Then I would give them statistical data. 

For example, Amazon went public in 1997 at 18 a share. It survived the dot-com crash and skyrocketed to an all-time high of $242.05 a share on February 4th, 2025, inclusive of 4 splits.

• June 2, 1998: 2-for-1 split

• January 5, 1999: 3-for-1 split

• September 1, 1999: 2-for-1 split

• June 3, 2022: 20-for-1 split

According to investopedia.com, If you had invested 1000 dollars in Amazon’s IPO in 1997, you would have received 55 shares. 

Had you held the shares until March 16, 2025, your five shares would have been worth approximately $2.5 million to $2.7 million at the closing price of $197.95 a share, which would have yielded an incredible increase of over 249,000% on a 1000-dollar investment. 

Do I have your attention yet, or do you still think that you don’t make enough to retire a millionaire?

Although there are no guarantees in the stock market one thing is for certain. When you spend your money wastefully in the old economy versus investing your money wisely in the new economy, you have absolutely no chance of a dignified retirement. 

With today’s current onslaught of mega information claiming ignorance is no longer a leg to stand on and simply doing nothing is silly lazy and juvenile not to mention selfish.

So, you must develop an investment strategy as oppose to the one where you invest your time week in and week out slaving from check to check playing lotto and hoping for a better future..

THE SHORT CUT IS THE LONG ROUTE…

Risky Randy wouldn’t recognize a good company if it bit him, because he confuses a good company with a good profit.

Risky Randy fails to recognize the true value. God forbid he should learn the value of free cash flow…so, he treats his cash like a promiscuous vixen spreading it around without care for risk management. 

What’s the sense of owning a buffet of stocks and praying that you get lucky?—as if you are putting money down on every stock that tickles your fancy like it’s a game of Russian roulette. 

And the odd part is that they are quick to post what they own on social media, with an “LFG” in the caption, but when the stock goes the opposite direction they have a cataclysmic meltdown. 

This is usually the start of financial Armageddon and the simultaneous chemical reaction that sends a signal to their brain that they wrote a check their emotions couldn’t do without.

When are you going to wise up and realize that investing is not a luck or gambling-based activity?

It takes strategy and financial analysis, and most of all—experience and a deep upstanding of the data. Plus, it helps to have a historical perspective. 

Risky knows absolutely nothing about the company’s leadership or financials, but is quick to run an option play without an understanding of the Greeks.

Whenever I speak with Risky Randy types, I always ask them fundamental questions that every investor should know, and their reply always starts with a dumbfounded look that’s more familiar with a three-year-old that’s soiled their diaper. 

But they are quick to have a run-it-up mentality, without a plan for the rundown. Contrary to popular belief, the stock market is not the upmarket, and timing the market is damn near impossible, as nothing goes up or down in a straight line. 

“But my social media guru said it’s going up and to buy it when it breaks resistance”. 

First of all, why are you taking advice from social media? Doesn’t that feel strange to you? These guys read and study a chapter on the market and then with no true insight regurgitate the information back to you. 

Look at your account. Let the math speak for itself. Sooner or later, you will be challenged with the question, is it worth it? Especially after you got lucky on an option play; your ego convinced you it was skill, so you rolled the dice again and took an L (Loss). 

The only problem is you booked the profit coming out of 2024 and owe the IRS one-third or more of your profit, but you lost the money at the beginning of 2025 on the same Risky Randy behavior. 

Welp, good luck with that…

Why didn’t the social media guru educate you on the fact that you work for the government whenever you are booking short-term profits?

Look…the only way to get rich is slow. Any other route is the short cut and regardless of what you heard the shortcut is the long route. 

STAGED STAGFLATION: A SELF-INFLICTED CALAMITY…

Pay very close attention…do you remember the Arab oil embargo of 1973? On October 6th, 1973, Syria and Egypt led a surprise attack on Israel during the Jewish holiday, Yom Kippur, aiming to reclaim territory that was lost in 1967. 

Of course, this drew in the United States and other Western nations, which included military and logistical support. 

This angered the Arab nations at a time when the United States and its allies were dependent on OAPEC (Organization of Arab Petroleum Exporting Countries), which included oil producers like Saudi Arabia, Kuwait, and Iraq.

And Just like President Trump is using tariffs as leverage to influence foreign trade, the OAPEC nations sought to use their biggest bargaining chip—oil…to influence foreign policy in regard to the Yom Kippur War. 

On October 17, 1973, OAPEC announced an oil embargo on the United States, Canada, Japan, and Several Western European nations, which meant cutting oil production and limiting exports to these nations—at a time when OAPEC controlled 25% of the world’s oil. 

The oil embargo caused a dramatic increase in oil. Crude oil prices quadrupled, rising from 3 dollars to 12 dollars a barrel causing extreme economic consequences. 

This led to stagflation in the United States and other nations, as industries that relied on oil increased costs and passed it on to the consumer in the form of increased prices for goods and services. 

They say what doesn’t kill us makes us stronger. This is the direct catalyst that led the U.S. to become the largest producer of oil in the world, but not before succumbing to the pressure of Middle Eastern oil.

The impact was severe and widespread, leading to a major increase in the cost of living, pushing the U.S. into a recession between 1973 and 1975. 

Now keep in mind, that President Nixon removed the Gold Standard in 1971 exiting the Bretton Wood System, creating what was known as the Nixon shock. 

The Bretton Wood System was established after World War II where currencies were directly pegged to the U.S. dollar, which was convertible to gold at a rate off $35 an ounce. 

This system relied heavily on the gold reserves of the U.S. By the late 1960s and early 1970s, the U.S. was experiencing balance of payment deficits due to increased spending on social programs and the Vietnam War that led to the depletion of gold reserves. 

Rising inflation limited the United State’s response economically because the money supply was tied to gold, unlike today where they could just print money. This was the beginning of fiat currency and the end of the Gold Standard.

On August 15, 1971, Nixon announced the suspension of the dollars, and convertibility to gold, ending the Bretton Woods System. 

Since the dollar was no longer attached to the physical commodity of gold, the value of the dollar was determined by government regulations and market forces, which meant the Feds could manipulate the outcome—introducing quantitative tightening and quantitative easing, to better fight recessions where the Gold Standard limited their ability to take the economic pressure of the economy—because of their responses, were measured based on the quantity of gold reserves. 

Also, keep in mind…Nixon was forced to resign from the presidency because of the Watergate scandal; so, not only was the United States in an economic recession but also in a crisis of leadership. 

Inflation had skyrocketed and stagflation lasted in the United States for nine years (from 1973 to 1982) and the Fed fund rate peaked at 22.36% in July 1981. The removal of the Gold Standard led to what is called Keynesian economics, where government spending and lower taxes were the focal points to stimulate the economy. 

Irresponsible government spending leads to inflation. This is why it’s important to have unity between fiscal and monetary policy, which is what we saw during Bidenomics. 

The Feds injected 5 trillion of money into the system and Democrats passed a slew of programs that meant the printing of money—which caused inflation, leading to them attempting to move the goalpost on the meaning of recession. 

So, when the Feds raised the Fed fund rate the government should have been tightening the belt, instead they were pouring water in the boat while the Feds were dumping it out. During the oil embargo, Keynesian Economics failed miserably as it failed to address the high inflation and high unemployment of stagflation. 

Keynesian economics focused on the demand side of the economy, but it was Milton Friedman who introduced monetarism, which ended stagflation. Monetarism focused on money supply as the source of inflation. 

If there is too much money in the money supply this would cause inflation as there would be too much money chasing too few goods. Now, here comes Paul Volker in 1979. He preceded to raise the Fed fund rates into the low 20% range, tightening the money supply and slowing down the economy. 

Paul Volker prioritized price stability over short-term economic growth, which restored confidence in the dollar and stabilized the economy, which created a path for economic growth in the future. 

Which brings us to the current state of the money supply—there are still approximately 2.66 trillion dollars in excess supply over the 4.1 trillion dollars of pre-pandemic totals in the economy.

And although it is shrinking, it’s shrinking at a pace of less than a trillion a year, so that should give you an idea of how long we will have a bloated balance sheet and the potential threat of inflation will stay around if the government acts irresponsibly. 

So, staged tariff shocks combined with supply chain shocks can lead to an economic catastrophe. Especially if the Feds start to lower rates and make money cheap again. 

This would help Wall Street in the short term but crush the economy and hurt Main Street over the long term, especially if tariffs leave Americans with limited choices and corporations become less competitive. Hope this gives you a window seat into the potential calamity.

WHAT GOES UP MUSK COME DOWN…

Question…how much does a presidency cost these days? I guess you should ask Elon; it cost him a quarter billion dollars. For his troubles, he received a shiny new government, plus a leadership position as the head of the Department of Government Efficiency. 

The only issue is that not only did he pull out a machete and start hacking the government structure, but he polarized his shareholders and Tesla dropped like a meteorite—making his shareholders more nervous than a Mexican drug mule trying to get past TSA in the airport.

He is no stranger to controversy and it’s not the first time his political stance has stampeded the stock, but apparently, his official government antics have gotten the attention of the largest labor unions in the United States—the American Federation of Teachers. 

Randi Weingarten, the president of the American Federation of Teachers, wrote a Dear John letter to some of Tesla’s largest shareholders—Blackrock, Vanguard, and T-Rowe Price, urging them to look into the valuation of Tesla, as they are concerned that Elon is destroying the value of its shareholders. 

My argument is—what did you expect? A 170% election gain, based on thin air to levitate without the supporting data? 

You may be able to buy a presidency for $288 million, but your stock price only exists in a world where projection earnings and revenue targets are met. 

On September 5th, pre-election, Tesla hit a daily low of 182 a share and proceeded to hit a high of 488.54 on December 18th, 2024. Since then, the stock has plummeted, and so has Elon’s popularity. 

A report stated that over 30 Cybertrucks were spray painted “F Elon”. If that’s not a vote of confidence, what is? 

I’m joking, but seriously…Tesla stock has been in and out of the doghouse since 2022.

Everyone remembers its epic run after its two stock splits and its not-so-epic fall from its November 1st, 2021–high of 407.36 to its January 13, 2023, low of 113.93.

In 2023, Tesla attempted to reclaim its highs peaking at a gain of 149% in 2023—July running from 113.93 to 281.38, but the inability to keep its word has left the streets, its shareholders, and Wall Street with a string of disappointments—starting with shrinking margins, price cuts, falling car deliveries, failed promises of a $25,000 car, and the long-awaited invisible FSD.

I have learned in my career on Wall Street that consistency, efficiency, and growth are Wall Street’s hot buttons. So, let’s rewind a touch, to October 23, 2024; the stock was trading at 213.56. Tesla stock started to regain momentum to the upside which was well received, but something was missing and that emptiness was the absence of fundamentals. 

Nothing had changed, fundamentally, except his support for President Trump. It was almost as if the street was rewarding his stock for helping President Trump get elected. The theory was that now that Elon was in government, it would increase his chances of getting FSD approved. 

If this was to be the case, the dynamics of Tesla’s investability would change for the better as his margins could drastically improve, which is part of the first reason why the street took the stock down in 2022 from 361.53 to 123.18.

Shrinking margins are a bad sign in any company’s investment picture. It could mean that their products are running against a better competitor, which could put pressure on pricing. 

Add to this fact, Tesla has not refreshed or redesigned their car designs at this point since 2016, as compared to other auto companies that redesign their cars every three to five years with a full facelift every five to seven years. 

Tesla redesigned the interior of the Model S in 2021—five years after its last interior and front-end refresh in 2016. 

They have yet to make a full redesign of the Model S, and they just revamped their car designs for the Model 3 in 2023 and Model Y in 2025. So, Wall Street has felt that the lack of enthusiasm for their cars and waning sales were due to the outdated product line up. 

With AI, the empty promises of great technology, and a refreshed car lineup, the stock still ran and peaked at 488.54. I guess government membership and access have its privileges. 

Musk’s falling popularity and reality finally setting in is the only thing that’s changed at Tesla. Elon’s absence from running the day-to-day and the car company’s declining fundamentals have stayed the same. 

This goes to show you that the hype on Wall Street, fueled by an extremely large purse is real. But what goes up in the air, “Musk” come down, and we have witnessed all election gains evaporate with the reality that a stock price can run divorced from fundamentals, but they can’t outrun them. 

With that being said, even with his absentee leadership, he has a long leadership bench, and due to his particular genius, I would never bet against Elon Musk. 

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 Kevin Davis, Founder of Investment Dojo and Author of The C.R.E.A.M. Report