Last night the Jewish holiday of Yom Kippur began -- it ended this afternoon.

The "Service of Healing" followed the main service and ended with T'Filat Haderech:

May we be blessed as we go on our way,
may we be guided in peace.
May we be blessed with health and joy,
may this be our blessing, Amen.

After the service my pal Amanda Salzhauer gave a lecture at the Temple on cultivating compassionate and connected children.

"Of course you want to help your child make the world a better place; that's why you picked up this book. With meanness and bullying so prevalent, you may be among the many parents desperate to have kids engage in more civil, respectful and considerate behavior. You may be part of the national conversation about fostering compassion and kindness in children. You may be looking to start with one child-- yours."
-- Amanda Salzhauer and Dale Atkins, The Kindness Advantage

Amanda's new book, The Kindness Advantage, was made available this week -- and I read it from cover to cover last night.

This book has purpose, is goal-oriented and is written by someone who is an amazing role model to many -- including my family.

If you are looking for a valuable gift for a parent, a grandparent or great grandparent (or any other friend or relative) I can't think of a better Holiday gift than Amanda's book, which is filled with insights and practical ways to instill the kindness gene in our youth.

May this New Year
be for you and your loved ones
a time of building bridges,
new beginnings, joyful journeys
and hopeful visions.

Thanks for reading my Diary today and enjoy your evening.

"Is there anything at all that can derail this stock market rally?"
-- Brian Sullivan, CNBC (today)

To me all the ingredients for a market drop are now in place:

* Speculative activity is on the rise (materially so in the case of Tilray (TLRY) and others in the space).
* Investor complacency (not a soul, save perma bears, are looking for anything like a large markdown in mkt).
* Rising interest rates -- with the pace of the yield climb now accelerating to the upside.
* A host of possible near-term adverse catalysts: the mid-term elections, an increasingly isolated president who conflates policy with politics (e.g. trade war with China) the Mueller investigation, (Cohen and Manafort turned). 
* An extreme change in the market structure -- much like portfolio insurance in 1987, (ETF and Quant strategies and products dominate the market) -- in which participants are all on the same side (long) of the boat.
* Social unrest as the benefits of monetary and fiscal policies failed to trickle down.
* Weak market seasonals.
* Technical divergences.

Dillard's (DDS) trades over $80 -- I recently reestablished my long investment under $73.

The opportunities in this trading sardine has been legendary over the last 12 months.

Stated simply, DDS is the gift that keeps on giving!

This is absolutely absurd and consistent with an increasingly irrational and speculative market:
Today Tilray (TLRY) has a market cap of over $20 billion.
This compares to Western Digital (WDC) at $17.5 billion, Hartford Financial (HIG) at $18 billion, to Kellogg undefined at $25 billion and to the market cap of only $22 billion for Twitter TWTR (which is my largest long position).

Though the Dow (+198) and the S&P 500 (+6) are higher today, the league-leading Nasdaq is continuing to trail ( (QQQ) is down by a beaner to around $182 and approaching important technical support).

I recently made $6 + on my QQQ short and reloaded a few days ago. 

In the old days this sort of divergence and rollover in the former market-leading sector was a negative market tell.

These days not so much!

Bond and note yields at day's highs -- with gains of nearly four basis points.

The 10-year yield is over 3.08% and the long bond at 3.23%.

So, I further pressed my bank longs and (SPY) short.

A good one from Mikey, my South teammate:

badgolfer22 • an hour ago

Since it looks like I'm the only one caring about the mkt this morning, I'm gonna let you in on another 'catharsis' that I've had to ponder for quite some time.

I think now with the brave new world of Algo and hft trading, quants, vol trading etc, I think you have to be very careful of relying on old market adages that have been reliable over the decades when humans and emotions drove stock prices before 'garbage in, garbage out' and 'fishing' trading systems have come into vogue.

Used to be 'sell in may and go away' was very reliable. So was 'the best 6 months in the mkt start in Nov'. Pick any data point that guys like Hirsh at traders almanac give you at any point in the calendar and lop on a healthy dose of skepticism these days.

I say that because today is Yom Kippur and the old adage of selling on Rosh hashanah and buying on Yom Kippur was a good trading adage.

I'm very leery of these anymore. Algos I don't think give a rat's a** about any of these old 'human' trading patterns.

With the rise in interest rates starting to accelerate (3.07% on 10-year U.S. note), I have done two things this morning:
* Despite my concerns regarding slightly below consensus 3Q EPS - I have moved from small sized to medium sized in the banks.
* I have added to my (SPY) short.

This morning I added to Twitter (TWTR) at $29.02 and to my (SPY) short at $291.29.

"The problem with the world is that fools and fanatics are always so certain of themselves and wiser people so full of doubts."
-- Bertrand Russell 

The interest rate for a Tilray (TLRY) borrow is now over 264% -- that's annually!
Be forewarned.

Twitter (TWTR) is now my largest investment position.

I have literally added to the position each of the last 7-10 trading sessions.

It is so based on my calculus of reward vs. risk, which suggests more than +$20/share (upside) and only about -$5/share (downside). That ratio, of 4:1 provides the basis for the investment appeal of this name.

As I recently wrote:

The stars might be aligned for a move higher in Twitter's stock now.

Twitter's shares tend to trade with their social media and FANG brethren. The aforementioned (especially FANG) have moved considerably lower in the last month -- paving the way for a possible bounce and share price recovery over the next few trading days.

If history holds, Twitter's shares could follow higher as well.

Moreover, expressed last week, the timing (and price) of a Twitter takeover seems right over the near term. In support of this view, here is what I wrote about Twitter on Friday morning in " The Odds Are Beginning to Favor a Google Acquisition of Twitter":

The Appeal of Twitter

The recent Congressional hearing with Twitter's Jack Dorsey (and Facebook's management) makes one thing apparent, and that is the public forum TWTR has become is singular in its uniqueness.

This uniqueness (and scarcity value) alone may make it a value at current prices for a potential acquirer - especially at today's valuation.

Despite the eradication of fake accounts and the uneven course of usage, the scarcity value of Twitter is steadily expanding. This is occurring at a time in which the currency for a possible takeover has climbed over the last six months, as (despite the recent dip) the shares of potential acquirors have exhibited large year over year gains.

In the fullness of time, there is little question that engagement and advertising will continue to benefit from the uniqueness of the Twitter platform and for the need to diversify away from Facebook and Alphabet..

As a result, I recently raised my estimate of private market value to $50/share compared to the current price of $30.75.

The Timing for a Google/Twitter Combination Seems Right

Taking a page out of Amazon's acquisitive approach towards aggressively expanding it's empire (through tactical vertical and horizontal strategic industry moves), it seems increasingly likely that Google may consider the acquisition of Twitter in order to consolidate and provide even broader business functions.

Moreover, as a result of the factors leading up to the this week's Congressional hearings, all social media companies now will be faced with continued and rising costs associated with the monitoring and supervision of search and data dispensing functions as well as the proliferation and eradication of fictitious (robot and untoward/incendiary) accounts. Twitter may not want to take up the large cost of the project (that Jack Dorsey has recently agreed to undertake) and may reach out to Google in order to lighten and consolidate the additional expense load.

The timing seems right, particularly given the current Administration's apparent lack of interest in pursuing antitrust restrictions on Amazon (et al). Indeed, Google may want to move forward (post haste) with a takeover of Twitter before the possible assumption of a Democratic majority in the House and Senate in November, and even before a possible change in the White House's occupancy in 2020 - as those potential changes may result in renewed assessment of antitrust (which could limit the ability of Google, Amazon and others to grow internally and externally).

At $30.75/share, Twitter's enterprise value is only $23 billion - according to my analysis (discussed earlier) its private market value is about $50/share.

Google has the cash ($76 billion) and the currency (a market capitalization of $825 billion) - and the recent decline in Twitter's shares may provide an opportunistic time for such an acquisition.

I would rate the likelihood of a transaction over the next 12 months at between 35% and 50% - which is a relatively high probability.

***

Twitter was placed on my Best Ideas List on at $15.75 in March 2017.

I have traded Twitter back and forth profitably over the last two years, with sizeable gains on more than five separate trades -- and I have recently reestablished a long position, having added considerably to an already large sized holding late last week.

* Tilray is now a sideshow of classic speculative activity
* Neither go short nor go long TLRY
* Ignore TLRY and move on
Pot stock Tilray, Inc. (TLRY) is trading at $215/share (+$60 in premarket trading). 

The short squeeze is reminiscent of Robert Wilson's legendary short in Resorts International.

The price action in Resorts, Tilray, Tesla (TSLA) (two years ago) , etc., are examples of why my basic and first tenet in short-selling is to avoid stocks with high short interest as a percentage of float and as a multiple to average daily trading volume.

I have learned this lesson the hard way and I have the scars on my back from that experience.

But this tenet has worked out well in my short strategy as I have avoided short squeezes over the last 10-15 years!

Tilray was featured in a segment on Jim Cramer's Mad Money last night. Brendan Kennedy, TLRY's CEO, seems to be a perfectly nice fellow. But do yourself a favor -- neither go short nor go long Tilray shares.

Both actions are gambling and not trading or investing.

This recommendation will save you a lot of money and aggravation.

My strong advice is take TLRY shares off of your stock monitor and move on from it -- your investment portfolio and emotional well being will be far better off for doing so.

Here is the tape of last night's Mad Money segment!

Knowledge@Wharton "Is the Stock Market Overvalued - Shiller v. Siegel?"

Move over T.I.N.A. ("there is no alternative") and say hello to C.I.T.A. ("cash is the alternative")!
The spread between the three-month Treasury Bill rate and the S&P dividend yield is at the widest level since January, 2008: