| | | | August Unemployment Rate?
First, don’t miss today’s Daily Chart Setup trade idea down lower in this newsletter.
Today in the pre-market, the monthly non-farm employment report (aka jobs) and the unemployment rate are dropped by the BLS. Last month, Trump removed the BLS head. What might the new head release?
Come join me as we dive in and see what’s moving!
Plus, as always, we have stocks popping and dropping so come find out what is moving this morning as I look for stocks and do some live premarket analysis on SPX, SPY, NDX, QQQ, Russell, IWM and other stocks that are potential plays for the day.
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Trading the 2008-Level Default Wave in the Corporate Bankruptcy Bonanza
The Smart Money Is Already Positioning for This Distressed Opportunity
Something caught my eye recently that reminds me of patterns I haven't seen since the 2008 crisis — and it's creating opportunities that most traders are completely missing.
Large U.S. companies are going bankrupt at the fastest pace since the 2008 financial crisis. I'm talking about major corporations, many of them publicly traded companies that investors thought were safe bets just a few years ago.
Now look, watching this unfold is like observing a slow-motion car crash. Except instead of looking away, smart traders are leaning in with their calculators out, wondering what sector gets hit next.
Here's the thing most people don't understand — car crashes in the market can be a gold mine of opportunity for those who know how to position themselves correctly.
The Three Sectors Getting Hammered
I've been tracking three specific areas that are taking the biggest hits. First, consumer goods companies, especially retail stores like Forever 21, Claire's, Bed Bath & Beyond, and Party City, are struggling with changing consumer habits and debt loads they can't service.
Second, commercial real estate is hitting default rates we haven't seen since 2008, primarily due to high interest rates making refinancing nearly impossible for overleveraged properties.
Third, health care companies are struggling to pay their bills despite consistent demand — a contradiction that creates unique opportunities for discerning investors.
How to Profit From the Carnage
The real opportunity lies in what I call 'vulture capitalism' strategies — buying distressed company debt for pennies on the dollar, then profiting when companies restructure or get sold for parts. This isn't about being heartless; it's about understanding market cycles.
Think of it as 'the circle of life' in markets, where the weak get eaten and the smart get rich. These bankruptcy waves represent a transfer of wealth from the unprepared to those who recognize the patterns early.
The key is patience and proper due diligence. Not every bankruptcy creates a profitable opportunity, but when you identify companies with valuable assets trading at massive discounts to their breakup value, that's where fortunes are made.
I'm keeping a close watch on this trend because history shows us that the biggest opportunities often emerge from the biggest disruptions. Those who position themselves correctly during these cycles often look back at them as their most profitable periods.
Now be sure to join me live at 9:15 a.m. ET for “Morning Monster,” my market-open livestream on YouTube!
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