BlackBerry (BB): Motion Mistaken for Control
BlackBerry (BB) went parabolic while Hormuz, Warsh and Beijing showed how little anyone controls; what rich premium means for patient traders.
The Chokepoint That Moved Nothing
The letter opens with the nightmare every desk had pencilled in: the Strait of Hormuz, the busiest crude passage on earth, sealed for months. Oil started the year around seventy dollars a barrel and, after all that, sits at roughly the same figure. The fear premium built and evaporated, and whoever rushed into crude as insurance handed the gains back almost at once. The most important chokepoint on the map got squeezed and the price barely blinked.
I pull on a thread I cannot leave alone: hardly anyone steers what they claim to steer. Warsh talks tough on inflation while most price swings come from energy, food and supply shocks no rate hike can touch. Beijing declared victory over its property collapse by quietly rerouting bank lending from apartments to EV and solar plants; the bust went unhealed and merely slipped off the front page, and with the credit hose now being clamped it is seeping back. Different actors, the same delusion: that being busy and being in charge amount to the same thing.
Traders catch the identical fever: extra screens, extra alerts, extra tickets, a slot machine that pays in dopamine while the account leaks. The edge I keep returning to is dull on purpose. I accept what I cannot move, trade less, wait better, and let compounding do the heavy lifting.
Gasoline Under a Calm Surface
The signal that matters most for anyone holding options sits mid-letter. S&P gamma has sunk to among its lowest readings on record, meaning the dealers hedging the options they wrote are now forced to chase: adding exposure after rallies, shedding it after drops, amplifying whichever direction the index picks. Add thinning liquidity and crowded positioning and the fuel for a violent move is piling up under a calm surface.
Index correlation is collapsing too, so single names march to their own drums while the index sits on kindling. That argues for cheap protection on broad indices, held for the tail rather than the trend, and for mean reversion in corners the crowd has abandoned, software among them. Chasing overextended hardware momentum is precisely the motion that feels like control and rarely is.
BlackBerry is the case study. The stock has gone parabolic and dragged a bloated implied volatility along with it. That is when selling rich premium into overbought euphoria can offer a wide margin for error, provided the momentum burns out into sideways chop and time does the work. The letter sketches such a structure as food for thought, flagged as observation mode and reserved for rock stars. It asks for no forecast of where BB goes, only the patience to let pricey premium decay while everyone else chases.
Payrolls, Sintra and a Parabolic Chart
The calendar is compressed and holiday-shortened, and a thin summer tape magnifies every print. Payrolls arrive early on Thursday, with ISM manufacturing and Eurozone inflation alongside, all ahead of America's birthday weekend, and Warsh speaks at the ECB's Sintra forum with every syllable sifted for clues. The market still prices tightening; the falling oil curve argues inflation has peaked, which could flip the script toward a September cut. Powell's hawkish lurch that cracked stocks within weeks is the precedent to remember.
Further out: the memory cartel, where Samsung and SK Hynix signal expansion while Apple lobbies Washington to source chips from a blacklisted Chinese maker; and the froth, which left the frozen AI IPO window and strolled over to nuclear SPACs, many of them public without a paying customer.
And BB itself. If the melt-up rolls over into chop, the thesis holds; if it keeps ripping, the market has more to give and my response matches the rest of the letter: sit still, keep size small, wait for the fat pitch. Motion is cheap. Control is rare. The account that survives the year belongs to whoever can tell them apart.
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