Sometimes you feel like a nut,

Sometimes you don't.

Almond Joys got nuts.

Mounds don't.

-- Almond Joy advertisement

Though I have heard a number of justifications for today's large advance, I don't buy most of them. Frankly, to me, many of the reasons given are simply a rationalization and argument after the fact.

As I mentioned in "Afternoon Reflection," one of the possible keys to success in navigating this market going forward is the willingness to position yourself in an unemotional way and contrary to the very near term trend.

In today's case, I added to my net short exposure.

Thanks for reading my diary today and enjoy your evening.

From the nut.

Now its time to reflect on some individual equities that I am involved in,

As I mentioned earlier, price action in extreme days (up and down) often provide some messages:

* Allergan's (AGN) poor response to the Teva news is disappointing. But maybe all the AGN buyers reside in the Florida Keys and Houston!

* Disney (DIS) turns negative -- after weeks of profoundly weak performance -- despite word that its parks may be soon re-opening. This is not a positive signpost.

* Starbucks (SBUX) "action" is no better than that of Disney, especially given it's recent underperformance as well.

* Despite the replenishment needs for autos in Texas and Houston -- I am unimpressed with the action in Ford (F) and GM (GM) today.

* Amazon (AMZN) is back into my $975-$980 short sell level zone -- but I am giving this high beta stock some leeway in here before I reestablish my short position (I am down to tagends).

* Speaking of (T)FAANG, while Tesla (TSLA)  is great -- the ever popular and FNAG value play, [Alphabet] Google (GOOGL) , continues to lag.

* Caterpillar (CAT) , too, is disappointing considering the replenishment needs for its products.

* Homebuilders' stocks also not doing much in the face of the rebuild in Florida and Texas.

* Tesla, which I am not short, is killing the short community (based on some regulation news). Two hedge funds that were short acquiesced today and covered large shorts, according to my contacts on desks.

* Financials are predictably strong given the bond rate rise.  Deutsche Bank (DB) continues to be a standout and serial underperformer.

* Fertilizers strong despite a mixed ag commodities picture.

Here are several random afternoon thoughts:

* Media: The talking heads in the business media have become, more and more, organs of the consensus. Increasingly I find discussions in most biz media venues as flat, non-value added and repetitive. Conversation is uninspiring, lacking substance, running mostly on the surface. Little in the way of non consensus views are presented. First level (as opposed to second level) thinking is commonplace. Bullish participants are growing ever more self confident and glib in a market in which every dip has been bought. (Avoid them as numerous outcomes (see below) are possible). Remember, communicated investment wisdom is 20/20 when viewed in the rear mirror.

* Uncertainty of Outcomes: Despite the confidence in view of the many, the only certainty is the lack of certainty. Despite what you might be hearing, today's spirited advance in the market has occurred with very little incremental news and has followed (potential) breakdowns in the Nasdaq and in a number of individual stocks (as I wrote late last week). It can reverse just as readily as it can extend itself.

* Another Apple (AAPL) Launch: More buildup, spare me. The Dick Tracey watch that doesn't have to be tethered to an iPhone -- yawn. Slightly longer battery life? The anniversary launch tomorrow will be accompanied by some modest changes in innovation. And then what?

* Be Suspicous of the Impact of Quants and Passive Investing Vehicles on Stock Prices and Short Term Trends : They are too often falsifying and/or exaggerating short term market price trends. Don't extrapolate those moves!

* Lost Memory: The market will likely continue to demonstrate limited memory from day to day.

* Lose Emotion When Trading and Investing: With concerns aplenty (and with the benefit of hindsight) at Friday's close, stocks were a buy and bonds were a sell -- though making such moves would have been uncomfortable. The same applies to investing. Be emotionless in buying weakness as long as you have a good and thoughtful sense of a favorable upside/downside.

Trade of the Week LINK, long ProShares UltraShort 20+ Year Treasury   (TBT) , hits the day's high at $34.14.

An old trading dictim is that you might consider selling or shorting stocks that are in the red when the market is broadly in the green (and vice versa).

Some conspicuous stocks that are weak today include Comcast (CMCSA) , Gilead (GILD) , Sprint (S) , and Lilly (LLY) .

Nordstrom (JWN) is conspicuously weak in an improving retail sector and in a surging stock market today, down $2.35. There is no news or rumors (that I have heard).

Mid morning musings from Sir Arthur Cashin:

North Korea does not test missile over weekend and U.S. tempers UN Sanction resolution. That raises faint hope of talks and some de-escalation.

Irma causes less damage than feared, which diminishes risk of insurers selling stocks to raise cash to pay claims.

While storm damage is less than feared, it is enough to keep the spigots open in Washington. That, in turn, keeps alive chance of more bipartisan deals.

All in all, a perfect Goldilocks backdrop for huge sigh of relief really.

I am reading and viewing a lot of hyperbole about today's market advance.

However, I would note that the [PowerShares QQQ Trust ETF] (QQQ) s are now up less (on the day) than they were down in Friday's trading session.

I've made token buys of ProShares UltraShort S&P 500 (SDS)  at $48.05 and ProShares UltraPro Short QQQ (SQQQ) at $26.66.

According to my contacts on institutional trading desks there is quite a lot of short covering this morning.

My pal Peter Boockvar, chief market analyst with The Lindsey Group, comments on construction, foreign exchange and data this morning:

We know the material damage done from Harvey and Irma both in terms of lost activity and the subsequent rebound will be all over the economic data in coming months and quarters. Thankfully Irma's damage should be much less than feared. Putting aside the awful human toll, we don't believe though it will influence what the FOMC will decide on. We also will likely see wages rise in an area that has already experienced a shortage of workers, that being construction. If you have the skills, there is now plenty of work for you in Texas and Florida. Thus, rebuilding in these two states will be pulling workers and resources from other states. As for any inflationary impact, inflation breakevens for both 5 yr and 10 yr time frames are at one month highs but still remain near the middle of the one year range. At 1.70%, the 5 yr breakeven compares with the one year average of 1.75%. The 10 yr breakeven is at 1.81% vs the 12 month average of 1.85%.

Continuing Mario Draghi's attempt last week at verbally weakening the euro, ECB Governing Council member Benoit Coeure threw his voice into the ring by saying "exogenous shocks to the exchange rate, if persistent, can lead to an unwarranted tightening of financial conditions with undesirable consequences for the inflation outlook. Against this background, the recent volatility in the exchange rate represents a source of uncertainty which requires monitoring." Mr. Coeure seems to be referring to a move in the euro from $1.40 to $1.05 and now back at $1.20 as some "exogenous shock." Perspective please. Since 1999 when the euro started trading, the average exchange rate has been $1.21. Voila.

We heard from some other ECB members, particularly Klaas Knot who heads the Dutch central bank. He said "prolonged monetary easing comes with diminishing returns, especially in a situation of very low interest rates. The longer the ultra loose monetary conditions persist, the larger this risk. Since loose monetary policy has stimulated risk taking in financial markets, asset prices can grow out of sync with real economic developments." You'd think I wrote that speech for him but I didn't. Either way, all else equal, we are getting tapering news in October. Plan accordingly. Also, ECB Governing Council member Ardo Hansson reminded everyone today that "the process of normalization of policy stance is very gradual and in fact, it has been already started." As a reminder, in April monthly purchases fell by 20b euros.

The full trading day after China essentially put a brake on the relentless rally in the yuan which was up almost every day for 3 ½ weeks, the yuan is having its sharpest one day percentage decline since February. Eliminating the reserve requirement that banks need to set aside for FX forward contracts that are bought for non bank clients is sort of the back side of the 'counter cyclical' measures the PBOC initiated back in late May that precipitated the rally since that led to Friday's move. The Chinese don't like one way moves, the don't like disorderly moves. They like order, they like 2 way markets, they don't want a currency that is too strong or too weak. They also have to overlay this desire on top of an economy that continues to face a massive debt bubble, the government's attempt to slow the pace of debt accumulation at the same time they want to grow at 6.5%. The market response was pretty much contained to the FX market as interbank rates were little changed while the Shanghai comp was up by .3%.

The US dollar weakness in the very short term might be taking a pause. As a bear on the dollar this year I acknowledge this and maybe a contra trend rally is upon us. That said, I expect further dollar weakness to follow any consolidation.

The uneven delivery of Japanese economic data continued with the better than expected July machine order print of 8%, double the estimate. It does though follow 3 months in a row of declines and is extremely volatile month to month. It also follows a downward revision to capital spending plans in Q2. For Japanese markets, it was all about the yen which is weaker on the heels of the yuan move and that led to a 1.4% jump in the Nikkei which as of Friday was basically flat on the year.

The only thing of note in Europe data wise was the better than expected Italian industrial production print for July which was up .1% m/o/m vs the estimate of down .4%. The y/o/y gain of 4.4% was the 2nd best of the year. Strong growth (relatively speaking), low inflation is the theme in Europe which is the best kind. If the ECB gets what it wants we'll see higher inflation, less growth and much higher interest rates.

"What do you want me to do,
To watch for you while you're sleeping?
Well, please don't be surprised when you find me dreaming too;
It's just a box of rain,
I don't know who put it there.
Believe it if you need it,
Or leave it if you dare;
But it's just a box of rain
Or a ribbon for your hair;
Such a long, long time to be gone,
And a short time to be there.

--Grateful Dead, Box of Rain

Though 16 years have elapsed since the World Trade tragedy, it doesn't get easier.

As many subscribers are aware, on every anniversary of the World Trade Center tragedy on Sept. 11, I honor my closest friend who was lost 16 years ago -- Chuck "Brown Bear" Zion -- as well as the other victims of the terrorist attacks that day.

Sadly, since the fifteen anniversary last September, Chuck Zion's dad, Rabbi Martin Zion, has passed away. He has joined his son in heaven after all these years of separation.

Please read this column, "Keys to a Life Well Lived," that I had written about Rabbi Zion, based on a letter he sent me in October, 2016, two months before his death:

"Who is wise? One who learns from every man ... Who is strong? One who overpowers his inclinations ... Who is rich? One who is satisfied with his lot ... Who is honorable? One who honors his fellows."

--Ben Zoma, Ethics of the Fathers

Today marks 15 years since the Sept. 11 World Trade Center tragedy. (Please take some time that day to watch Ground Zero Rising, Jim "El Capitan" Cramer's brilliant documentary on the attack and the subsequent rebuilding). 

Sept. 11, 2001, is a day that we will forever remember with clarity and disbelief. I lost my best friend, while members of TheStreet community lost one of our own -- the late Bill Meehan. 

It still seems like only yesterday to me, and it's a day that I'll forever remember vividly. As I've written before, 2001 will for many of us forever be annus horribilis, the year of horror. 

On this day, as has been the case for the past 16 years, my eyes remain full of tears. I'm drafting this column in memory of all of those I knew (and didn't know) who lost their lives in the World Trade Center, in Pennsylvania and in Washington, D.C. 

As I've written previously, it's said that death leaves a heartache that no one can heal, but that love leaves a memory no one can steal. And so it will be on Sunday as we observe the 15th anniversary of the Sept. 11 attacks. 

As I've done in each of the intervening years, I want to use my opening missive to repeat the thoughts that I've often expressed about Sept. 11. As always, I dedicate this column to those who were lost -- especially to my best pal, Chuck Zion (a.k.a., "Brown Bear"):

"Chuck worked at Cantor Fitzgerald, the brokerage firm that lost nearly 700 employees 14 years ago. It was the hardest-hit company in the World Trade Center tragedy, accounting for nearly one-quarter of the building's deaths that day. I lost many friends at Cantor on Sept. 11: Eric, Pat, Timmy -- too many to count. So did many others. And of course, we all lost one of TheStreet's own, Bill 'Budman' Meehan (the bearded fellow on the right in the picture down below). 

In Cantor Fitzgerald's equity division, none had more of a presence (literally and figuratively) than Chuck Zion. He was known to his friends and clients as 'The Brown Bear,' a sensitive, giving and caring friend; father to Zack; son to Martin and Jane; and husband to the amazing Carole ('Cheezy'). His love was pure, and there was never any pretense -- not wordy, he was on point. 

The largest producer over the past decade at Cantor Fitzgerald, Chuck was master of his universe. He was straightforward and clear-cut, a no-nonsense and respected partner who was remarkably generous but never, ever wanted others to know it. He gave often and substantially but always anonymously, without strings attached. Chuck, who also worked at Salomon Brothers and Sanford C. Bernstein, put on some of the largest trades in the history of the equities market. He was the player the 'big boys' went to when they wanted anonymity. And I am talking multimillion-share trades, the really big prints. 

And it was Chuck who introduced me to Bill Meehan. He even had me fill in for Budman on a few occasions in the Cantor Daily News. 

I cherished and loved Chuck Zion -- he was my confidant and a brother that I never had. When I moved to Florida in the late 1990s, Chuck introduced me to his father and mother -- asking me to take them out once or twice a year, to look after them a bit. In time, Rabbi Zion and Jane became more than casual dinner mates; they became my mother and father, so Chuck and I really were like brothers (though absent the same blood). 

I spoke to Chuck every morning at around 6:15 a.m. If I didn't call him on my direct line to Cantor's trading desk by 6:20 a.m., he'd get angry and yell at me in no uncertain terms! Invariably, legendary money managers Neil Weissman, Stanley Shopkorn, Dan Tisch or Phil Marber (Cantor's former CEO) would interrupt our daily calls. He would take their calls, and then shortly, Chuck would call me back. We rarely talked about the stock market, preferring to talk sports and food (his favorite activity!). Sometimes Chuck would tell me to check out Maureen Dowd's editorial piece in The New York Times ('Dougie, she is mandatory reading'), or who was on Imus that morning. I got him to buy a couple of harness horses with me for fun and he got a kick out of them as we followed their losing races. 'We'll get him next time,' he would say (his credo) -- though we never did! 

We played golf together (Chuck wrote the word 'Lost' on each of his golf balls because he lost so many of them that he wanted the other players to know they were his), usually with Phil Marber or SAC's Andy Smoller. We talked NCAA football and basketball, especially about Syracuse University's teams (his alma mater). But mostly we talked about our children. 

The Friday before Sept. 11, 2001, was my last day in the office, as I was leaving for Europe for 10 days. That day we spent a lot of time talking about his son Zack, reminiscing about the trip Zack and I had recently taken to New Haven to Yale University, where he watched me lecture at Dr. Robert Shiller's class on short-selling. Chuck was so proud of the way Zack had become a man. And he was nervously awaiting Greenwich High's football season with such anticipation. (They had won the state title the previous year, with Zack playing the offensive line.) Every time he talked about the upcoming season, his voice would rise several decibels. He was the proudest father on the face of the earth. 

That Friday morning, the last day I spoke to Chuck, I was playing a Grateful Dead song in the background and I had Chuck on the speaker. Chuck was never what I would call 'into' music. He was certainly not a fan of the Grateful Dead -- maybe Motown, but not the Dead. Surprisingly, in our early morning talk, Chuck remarked how beautiful the song was. The song was Box of Rain, and the lyrics captured the concept of how short life can be. 

Chuck's New York Times obituary is still taped to my stock monitor in my office as an ever reminder of his loss. The paper is now aged, yellowed and torn, but the scars still seem fresh. 

Today, after writing this missive, I will again share Chuck's memories with his mother (Jane), his many friends (like Phil Marber) and with numerous longtime subscribers to TheStreet and Real Money Pro (like Don Gher who has already sent me a note). They were all Brown Bear's business associates, recipients of his wise advice or just friends -- and who, as they have every year, will pass on their day's thoughts to me in e-mails or phone calls, which I eagerly anticipate and will always cherish. 

Real Money Pro subscriber Don Gher mailed me a classic story [two years ago] about Brown Bear. Don was thinking about Chuck and relayed that one of his pals, ex-Cantor Los Angeles and Dallas trader Eddie Weber, told him that one day he was at Cantor's NYC office, and he and Brown Bear walked out of the World Trade Center to grab lunch. There was a hot-dog vendor there, and Chuck asked how many he had left. The guy said 12, and Chuck said, "Sold!" And then they proceeded to eat all of them. That was my brother, Chuck -- an original. ... 

I will never forget Mark Haines' report on CNBC of the first, second, third and fourth incidents that day, as I watched the horror on a television on a cruise ship in the Mediterranean.

And I will never forget the real-time reporting -- the confusion and emotion -- at TheStreet on that fateful day, the revelation of the extent of the tragedy and the follow-up tributes by our contributors. (TheStreet's headquarters were physically very close to Ground Zero.) 

Ironically or sadly, the Jewish New Year (Rosh Hashanah) and Yom Kippur (the Day of Atonement) quickly followed on the heels of Sept. 11, 2001. 

The most poignant recollection on TheStreet was the following post by Jim "El Capitan" Cramer, who recalled an incident at his synagogue. To this day, it always brings me to tears: 

'At our synagogue last night on the eve of the Jewish New Year, our rabbi asked us to shout out the names of friends and family that we'd lost that day. There were so many names, it was frightening and I was glad we had left the kids at home. I felt honored to yell out Bill's name. And I feel honored to have gotten to meet and work with him in his short time on earth. Oops, wanted to cry as I wrote that. Could feel it coming on. Nope, no can do. Not with that picture of him in my mind wearing that funny floral shirt. He wouldn't want us to remember him in any other way than with laughter. God bless your soul, Bill. God bless the Meehan family.'

-- Jim Cramer, Remembering Bill Meehan

Today, I will also share my fond memories of TheStreet's and Cantor Fitzgerald's Bill Meehan with his good pals Jim Cramer, Tony Dwyer, Herbela Greenberg and others, and we will all toast him as so many subscribers did in the fall of 2001. 

All that's necessary for the forces of evil to win in the world is for enough good men to do nothing."

-- Edmund Burke 

Fortunately, on May 2, 2011, some very good and courageous men gained revenge for Osama bin Laden's deeds some 10 years earlier. I hope bin Laden rots in hell, but revenge doesn't reverse the loss of so many. 

As Samuel Johnson once wrote: 'Revenge is an act of passion; vengeance of justice. Injuries are revenged; crimes are avenged.' 

I suppose that living and remembering are the best forms of revenge.

Thanks for reading this, and thanks for letting me wear my feelings on my sleeve.

... As you watch the annual tribute in downtown New York City, think about our lost loved ones and how lucky we all are. We all miss you, Chuck.

Below is a plaque memorializing Chuck at Temple Emanuel in Davenport, Iowa, where his dad Rabbi Martin Zion led the congregation:

Finally, I have dedicated my book, Doug Kass on the Market: A Life on The Street to Chuck Zion -- so that every time I pick up my book, I think about and feel ever closer to my pal."

I remain of the view that a Generational Bottom in Bond Yields was reached in July, 2016, when the 10-year U.S. note yield fell to 1.36%. (See my thoughts here and here.)

Since then, the 10-year yield has risen all the way up to about 2.60%, though it recently has fallen back to 2.05% in a "flight to safety" and because of slowing inflation, breaking under technical support at about 2.30%.

I believe that the trend in interest rates will be for a gradual rise over the next two years.

But the Trade of the Week -- long ProShares UltraShort 20+ Year Treasury (TBT) -- is geared to short-term trades. Let me emphasize that it is a trade, not an investment.

On that score, I am of the view that bond yields have fallen to levels that are not sustainable and that they have overshot to the downside as North Korean and hurricane fears have percolated. Here are my thoughts:

* High-frequency economic statistics indicate that approximately 2% real U.S. GDP is achievable over the next two quarters.

* Inflation data has been weak, indicative of a 1.5% to 1.75% rise over the balance of 2017.

* Combining real U.S. GDP and inflation implies a projected 3.5% to 3.75% nominal U.S. GDP could be expected in 2017's second half and into early 2018.

* Historically, the yield on the 10-year U.S. note correlates to 1 times nominal US GDP. That is, if real GDP is projected at 2.0% and inflation is estimated at 1.625%, projected nominal GDP (adding up the two numbers) is anticipated at 3.625%. If the historical relationship continues, the yield on the 10-year US note should be about 3.625%.

* We all recognize that central bank policy, demographics, technology, globalization and other factors are contributing to slowing growth compared to the past as well as weaker inflation. Accordingly, the 1 times multiplier (nominal GDP = 10-year U.S. note yield) that existed in the past is not suitable.

* Rather than use a 1 times multiplier, I prefer using a more realistic ratio of 0.7 times to 0.8 times nominal GDP to calculate a theoretical 10-year note yield.

* The above calculation would result in a yield of 2.53% to 2.90% on the 10-year U.S. note compared to only 2.05% at Friday's close.

Global Central Bank Policy

Recent comments out of the Fed suggests that the Fed will continue a go-slow monetary policy and attitude toward raising interest rates. No doubt the hurricanes will underscore that policy and our central bankers will be reluctant in moving (aren't they always?)

Nevertheless, the start of QT (quantitative tightening) seems inevitable.

I also want to briefly address European Central Bank, Bank of Japan and Bank of England monetary policy, which, too, seems to translate into a go-slow. As I have written, I don't buy the notion that low to negative yields in non-U.S. rates (especially Europe) substantially anchor U.S. rates as the cost of hedging -- increasingly volatile currency rates -- approaches 1% annually. It simply is very expensive to arbitrage U.S. and non-U.S. bond yields.

Hurricanes in Texas and Florida

A final note on the damage suffered in the states of Texas and Florida. As Jim "El Capitan" Cramer observed this morning, these events will halt the slide in autos and housing that I have been writing about.

While housing and autos have likely peaked, they will benefit from the hurricane rebuilding effort.

And so will inflation be artificially buoyed by that effort. (Look for building materials prices to rise consequentially). As well, there could be upside pressures to wages of a construction kind.

Bottom Line

While I remain of the view that most of the administration's growth-catalyzing initiatives are unlikely to be passed on a timely basis -- or at the very least will be substantially diluted -- interest rates have overshot to the downside and shorting bonds in the near term makes a lot of sense to me.

There are two separate and positive developments at Allergan (AGN) over the last three days that should continue to buoy its shares, which were up $6 on Friday. 

First, as I posted over the weekend:

Allergan and the Tribe Have Spoken

Sep 9, 2017 ' 9:29 AM EDT

Stock quotes in this article:

AGN

On Friday Allergan (AGN) rose by about $6 in an uninspiring broader market and in a flat biotech tape -- closing at $233.55 after trading as high as $235.87.

The proximate cause for the rise was an unconventional deal in which AGN has transferred all patents for its billion-dollar drug Restasis to the Saint Regis Mohawk Tribe in an unorthodox attempt to shield this important drug from legal challenges to its patents. Apparently this tribe has sovereign immunity against any legal challenges ( see here).

Wells Fargo called AGN's agreement an "innovative and unexpected positive move." According to the brokerage, the agreement should eliminate the threat, and an "important overhang" on the shares, of the inter partes review on Restasis, one of Allergan's largest products.

I have been steadily adding back to my AGN position over the last few weeks and this week I mentioned that I might take off some more stock at $230-$231.

I sold no AGN Friday and am reassessing any sale at these levels at this point, subject to more research over the weekend. (I will report back on Monday!)

I sold no shares as I want to evaluate the news over the weekend.

Second, this morning Teva Pharmaceuticals (TEVA) announced a new CEO, Kare Schultz. Teva's shares are up nearly 12% this morning in the premarket. 

Allergan should benefit as it received a 10% interest in Teva in the 2015 sale of Allergan Generics to the company.

I expect "sell side" upgrades in Teva this morning.

I have no current plans to sell any AGN.

Allergan was selected as my favorite large-cap long for 2017 (DuPont (DD) was my choice in 2016). I placed AGN on my Best Ideas List as a long at around $194 in December, 2016.

The state of Florida materially dodging projected massive damage from Hurricane Irma combined with the absence of any missile launches from North Korea have served to provide a relief rally to the global markets.

S&P futures are up 13 and Nasdaq futures up 45 in premarket trading at around 6:30 a.m.