Submitted by Portfolio Armor
A Painless Way To Reduce The Federal Debt
As ZeroHedge noted earlier this week, the US federal debt has been growing out of control, with the government adding $109 billion in debt in just one day.
With Biden 2.0 no longer an option, the Treasury has also stopped pretending and US government jumped by $109 billion in one day - the biggest one day increase since Oct '23 - to a record $34.831 trillion.
— zerohedge (@zerohedge) July 2, 2024
And now the debt starts to really move again https://t.co/ruprDPaYDq pic.twitter.com/0E7cx10cUS
A few days earlier, America witnessed something quite odd: a former Prime Minister of Somalia campaigning for Somali-American Congresswoman Ilhan Omar, telling her fellow Somalis that Omar didn't represent the interests of Minnesota or America, but Somalis and Somalia.
“Ilhan’s interest aren’t those of #Minnesota or the people of #America but the interests of #Somalia”
— 𝐃𝐫 𝐂𝐚𝐚𝐫𝐨 (@DrCaaro) June 30, 2024
These were the words the former Prime Minister of #Somalia @HassanAKhaire revealed at a rally in support of @Ilhan Omar exposing the true intentions of @Ilhan serving as a… pic.twitter.com/793NsYikp4
What Do Somalis Have To Do With The Federal Debt?
They make it bigger. Open borders zealots like Homeland Security Secretary Alejandro Mayorkas don't want you to know this, but there is actually data on which immigrants are net fiscal contributors and which are net fiscal burdens. Jonatan Pallesen, PhD, who holds a doctorate in statistical genetics, posted that data from his home country of Denmark recently. Of all the immigrant groups in Denmark, Somalis comprise the biggest fiscal burden, costing Denmark $15,000 per Somali per year.
Immigrants and descendants from Middle East and Northern Africa are very costly to Denmark.
— Jonatan Pallesen (@jonatanpallesen) July 3, 2024
Immigrants from Somalia cost on average more than $15,000 per person per year. This is more than a million dollars over a lifetime. pic.twitter.com/pfnoSacTyC
As Dr. Pallesen points out there, that's more than $1,000,000 per Somali over a lifetime.
Maybe This Is Just True Of Denmark's Somalis?
Probably not. One reason why Somalia is so poor (per capita GDP of about $600 per year) is because Somalis have such a low average IQ.
There is a strong correlation between the average IQ of a country and that country's wealth or poverty.
The Somali Solution
Debt reduction is often talked about in terms of tax increases and spending cuts, but you don’t hear as much about the fiscal benefits of sending Somalis back to Somalia.
Given Dr. Pallesen's point that the average Somali will be a fiscal burden of more than $1 million over a lifetime, you could pay them $100k each to leave and it would still be a bargain.
And you could extend this offer to members of other immigrant groups that are net fiscal burdens on average as well. Seems like it could be a win-win solution all around.
In Case You Missed It
In our last post ("Escape Velocity For Tesla"), we wrote about the potential impact of Tesla's (TSLA) deliveries data on its share price. The deliveries numbers came in better than expected, and Tesla's shares soared.
Escape Velocity For Tesla?
— Portfolio Armor (@PortfolioArmor) July 2, 2024
It may depend on today's deliveries data. $TSLAhttps://t.co/tsalLOahWv
As we noted there, our Tesla trade was on track to make a 200% gain as long as Tesla was trading at over $205 per share.
Our Tesla Trade
In early April, we opened trades on three beaten-down EVs, one of which was Tesla.
Our Tesla trade was a vertical spread expiring on January 17th, buying the $200 strike calls and selling the $205 calls for a net debit of $1.63. We got filled on that trade at $1.63. Since the maximum gain on this trade occurs when the stock is over $205, this trade is on track for its maximum gain.
Tesla closed at $246.39 on Wednesday, so Tesla becomes our third recent options trade on track for a 200% gain, along with our Carvana (CVNA) and SalesForce (CRM) trades.
If you'd like a heads up when we place our next trade, feel free to subscribe to our trading Substack/occasional email list below.
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