Saturday 30 Dec 2023
Could the average person have made a living from the big rise in the US stock market since 2009? The annual increase in the US stock market per worker (blue) is compared with average annual wage (red). You needed at least 3x the stock market gains per person. If you spent the gains, the capital invested needed be much bigger to be sustainable, ignoring dividends.
At 3x the stock market investment per worker you needed to invest $200,000 in 2009. If you had spent the gains, it would still have been worth $200,000 today, compared to the present investment required of $850,000. So you should have started with (($850,000 - $200,000) + $850,000)/$850,000 = 1.8x more. Now the stock market is expensive. A big fall in the market is required for such high gains.
The stock market investment required for the earnings to equal average wage:
Friday 29 Dec 2023
Nvidia Introduces Slower Gaming Chip in China To Comply with New US Export Rules - Investopedia. If China already exports inferior products, it would be difficult to retaliate. And where are these chips made? "Nvidia uses the Taiwan-based foundry to manufacture all of its advanced AI semiconductors" - Barron's.
The Morning After: Google will settle $5 billion lawsuit over tracking Incognito Chrome users - Engadget.
Record Global Gasoline Consumption Defies IEA Forecast (& EV Hype) - Zero Hedge.
Federal judge rejects X’s claim that California’s content moderation law violates free speech - Engadget.
Thursday 28 Dec 2023
"Thanks to F1, Las Vegas saw a 23% bump in gaming revenues in Nov on the Strip with casinos bringing in $1.37b. a November record and the all time second highest month of revenue statewide ever according to Nevada Gaming Control Board" - Twitter.
....From 11 April 2023: Economic Impact Driven by Las Vegas Tourism Industry Hits Record High $79.3 Billion in 2022. The records started before F1.
....Las Vegas-Paradise, NV - BLS. Leisure and Hospitality is the biggest employer. Employment was slightly lower in Nov than Oct. Is up over a year ago, apparently still a recovery from the Covid lockdows.
Wednesday 27 Dec 2023
"Javier Milei just passed the most sensible law in world history - known as Articulo 209. From now on, governmental institutions can no longer use the word "free" to promote any state service or function in municipal provinces or on a national level. Milei considers the use of the word “free” a lie and feels citizens shouldn’t be lied to since the services always paid by someone, typically tax dollars." - Twitter. The people who end up paying for "free" services are typically the poorest who do not have the pricing power to pass on their taxes.
"Amazon is adding ads to your $140 prime memberships next month. You have to pay $40 to opt out." - Twitter. Viewer response to ads (click-through rate) must be extremely low. How many thousands of viewers' time is wasted by irrelevant ads, for one sale.
The growth of US debt (money supply) per decade, starting with the last decade: 1.658x 1.660x 2.118x 2.555x 3.005x 2.096x 1.837x. If debt grows at 1.66x for the next decade, 1/3.5 (blue) would be at 46,000. That is close to where the Wilshire 5000 index (red) is now. If the stock market goes sideways for a decade, the two charts would intersect again. Due to never-ending money creation, it is just a matter of time for a stock market to return to a reasonable valuation. Shareholders will lose money relative to inflation.
The bad news is average wage growth (blue) is much lower. Since the 1990s the stock market divided by the population (red) has done 4x better that wages (the China impact). It will not catch up in a decade. If the stock market goes sideways, wealthy people will have to generate growth by working.
Tuesday 26 Dec 2023
"How import tariffs weaken the economy and your wallet" - Twitter.
Many governments have increased debt instead of cutting expenses or raising taxes. This was apparently an attempt to maintain the standard of living whilst economic output was weakened by the development of China's 1.4 billion population. Interest rates were lowered due the weak economy. Nobody can compete with the price at which China can manufacture products. At lot of currencies will lose value, depending on comparative advantages. China will likely be the winner. Japan apparently lacks comparative advantage.
Japan's economic output per person (blue) was 15.7% of the US (red) in 1960. In 1995 it rose to a peak of 156% of the US. By 2022 it has fallen to 45% of the US.
Since the peak economic performance in 1995, government has borrowed a lot more money. Government debt to GDP has risen from 42.1% in 1993 to 218% in 2021, a growth rate of 6.0% per year:
Japan government expenditure (blue) compared to the annual increase in government debt (red). A big chunk of government spending was funded by borrowing more.
Japan's economic output per person, relative to the money (debt) in circulation in the US, at 0.366 is lower than the 0.608 in 1960. The population has been impoverished by lower economic output, and now has a mountain of debt to pay.
Monday 25 Dec 2023
The US stock market at 48,055 is close to the previous peak of 49,175 (below). Unless the US gets a very different government, like Argentina, the money creation will continue.
Saturday 23 Dec 2023
"Aon Center, the third-tallest tower in Los Angeles, has sold for $147.8 million — about 45% less than its last purchase price in 2014" - Twitter.
"GM has issued a stop-sale order on the Chevrolet Blazer EV, following a week of reports about breakdowns from @InsideEVs, @edmunds and owners" - Twitter. Has GM and Ford ever produced quality cars?
For all the attention renewable energy receives in the media, its contribution is insignificant: Global primary energy consumption by source, Global primary energy consumption by source - Our World in Data. Wind was 3.07% of the total, and solar 1.93%.Wind and solar also need a back-up source of power, which requires twice the capital investment.
Friday 22 Dec 2023
High-Speed Transportation Startup Hyperloop One Shuts Down - Extremetech.
12-Foot Alligator Captured by Fla. Police at Mall Ahead of Christmas: ‘There Truly Is Never a Dull Moment’ - People. He just wanted to check whether the alligator leather goods were genuine.
US federal government interest payments was almost $1 trillion at $981 billion annualized in Q3 (chart), due to inflation making dollars worth less. It was bigger 1980-1999 relative to economic output (GDP).
US interest payments are 3.55% of GDP. Interest paid on public debt, percent of GDP - IMF. Brazil is the highest at 8.07%.
The interest payments are 15.3% of the current expenditures of the federal government, which is historically not unusually high:
Thursday 21 Dec 2023
How Much Was Clark Griswold’s Christmas Bonus? The Internet Wants to Know - The Hollywood Reporter. Inflation adjusted, game shows pay smaller prizes compared to 50 years ago, except for the cars won on The Price Is Right.
France's Le Pen Hails New Immigration Bill As "Ideological Victory" - Zero Hedge.
Wednesday 20 Dec 2023
The US average house price (blue left) is close to the total US debt divided amongst the working age population (red right). In 1980 total debt per working age person was less than half of the value of a house.
In the UK M3 money supply dividend amongst the working age population (red right) is 30% of the average house price (blue left).
Tuesday 19 Dec 2023
The P/E ratio of the S&P 500 is 26.19 (Multipl). In the past such a high level did not last long, and was often a peak. The highest peaks were the bubbles of 2000 and 2009. Either the earnings (E) could improve, or the price (P) could decline.
"GPT and other AI models can't analyze an SEC filing, researchers find" - Twitter. In the future AI could replace humans in television productions.
"The warmest autumn in the northern hemisphere in nearly a century and a half has pushed natural gas prices in the U.S., Europe, and Asia lower at the start of the winter." - Twitter.
From 17 Dec: "BREAKING: The weather in China, including Beijing, is the coldest December temperature in more than 50 years. Climate emergency warnings have been declared for extreme cold." - Twitter.
"BREAKING NEWS: Colorado Supreme Court disqualifies Trump from 2024 ballot" - Twitter.
After Japan's 10 year bond yield exceeded the growth in M3 money supply (blue above zero), it took 3 to 5 years for the Yen/$ exchange rate to reach its strongest level (red down). The growth in money supply determines the nominal inflation rate. A bond yield higher than that would give positive real interest (blue above zero). Since 2009 real interest rates have been negative, and the Yen has weakened since 2012 (red higher).
Monday 18 Dec 2023
"BREAKING: Adobe, Figma terminating $20B merger agreement" - Twitter.
"Adobe refuses to offer remedies to quell the UK’s antitrust watchdog’s concerns with the firm’s planned $20 billion purchase of design software maker Figma" - Twitter.
Commission opens formal proceedings against X under the Digital Services Act - EU.
"Tennessee sued BlackRock for allegedly breaching consumer protection laws by making “misleading” statements about its ESG investment strategy" - Twitter.
You'll soon need to get your fingerprints taken when entering Europe - The Street. Except if you arrive on a beach on a boat from North Africa.
"Scientists collect aardvark poop to understand how the species is impacted by climate in Africa" - Twitter. Watch out for the movie: Indiana Jones and the Aardvark Poop.
Sunday 17 Dec 2023
"The Magnificent Seven stocks (Apple, Microsoft, Amazon, Google, Nvidia, Meta, & Tesla) are trading at a forward P/E ratio of 33x versus 21x for the remaining 493 companies in the S&P 500." - Twitter. The majority of stocks have very low growth, and therefore trade on a low P/E ratio. The small number of growth stocks trade on high valuation. Neither is attractive.
"cash on the sidelines" - Twitter.
Saturday 16 Dec 2023
Here’s how wind farms in the US impact nearby home values - Electrek.
China’s iPhone Ban Accelerates Across Government and State Firms - Bloomberg.
Q3 2023 China Smartphone Sales Fall 3% Signaling Recovery Getting Closer - Counterpoint. Apple only had 16.0% market share in China in Q3, down from 18.0% a year ago.
In Q3 Apple net sales in China was 16.9% of the total net sales, compared to 17.2% a year ago (Apple).
Apple worldwide shipment of smartphones has remained the same for 9 years, since the introduction of the iPhone 6 (Counterpointresearch).
Friday 15 Dec 2023
Disney to lose Mickey Mouse copyright control after 95 years on January 1, 2024 - SCMP.
'Bank of Canada Governor Tiff Macklem said policymakers will consider cutting interest rates when inflation is “clearly” on a path to the 2% target, but added that it’s “too early” ' - Twitter. Does this chart of Canada's M3 money supply look like they have any control over inflation?
The reason for the enormous growth in Canada's money supply could either be money printing by the government to pay for expenses, or money created to supply the demand for credit as a result of interest rates (red) below money supply growth (blue) since 2003. As the chart clearly shows, when interest rates (red) are too low, a lot of money is created (blue high).
Thursday 14 Dec 2023
US personal consumption expenditures (blue) at $18,865B annualised in Oct 2023 exceed compensation of employees (green) at $11,916B annualised in Q3. Also show is the annual increase in US total debt (red).
The annual increase in the total net worth of the wealthiest 10% (blue) at times comes close to the difference between personal consumption expenditures and compensation of employees. The issue is whether the enormous increase in money or debt does not cause inflation, because most of it is accumulated by the wealthiest 10% without spending it, or is the inflation basket not measuring the price increases on high-end products.
Wednesday 13 Dec 2023
FCC proposes to ban cable and satellite TV ‘junk fees’ - CNN.
Toyota Slammed For 'Misleading' Public About EVs in FTC Complaint (Updated) - InsideEVs.
"Tesla recalls nearly all vehicles sold in U.S. to fix system that monitors drivers using Autopilot" - Twitter.
The German Plug-In Car Market Shrunk Almost 40% In November 2023 - InsideEVs.
"BREAKING: COP28 climate talks end with landmark deal to shift from fossil fuels." - Twitter. This is all based on politicians seeing carbon dioxide rise with temperature, and being unable to distinguish between cause and effect. The most likely cause of global warming is the filtering out of smoke from coal fired power plants. Some countries only have coal as source of electricity. There is no way the US can operate without natural gas and oil.
Fossil fuels still dominate U.S. energy consumption despite recent market share decline
- EIA. The EIA chart shows natural gas use shooting higher to 2040, and oil use continuing at the same level (until reserves run out).
The growth in US total debt (blue) and Euro M3 money supply (red) is similar, almost like it is co-ordinated. US debt growth has slowed to 4.3% in Q3.
Monday 11 Dec 2023
EU approves German state aid for closure of RWE power plants - Reuters. ".... to compensate for the early closure of lignite-fired power plants. The closure of RWE's profitable power plants was part of Germany's push to phase out all coal-fired electricity production by 2038."
"This Volkswagen ID.3 lost 10% of its battery capacity after just 30,000 miles" - Twitter.
"There is no inflation" - Twitter. Once you notice how governments manipulate the official inflation rate so that they can report real economic growth, it becomes obvious.
The US economy relative to total debt (blue) has declined from 0.68 in 1971 to 0.28 now, whilst the stock market to total debt (red) is at similar level to 1973. The stock market and total debt both increase with the net worth of the wealthiest 10%, whilst the economy represent the output of the poor workers. The stock market is expensive relative to gross domestic product.
Sunday 10 Dec 2023
"There has been a Chinese anti cancer drug called Toripalimab, that has just been approved by the FDA in the US. According to a cursory search on the web, a dose in China costs $280 whereas in the US it costs $9,982. " - Twitter.
Saturday 9 Dec 2023
Check out this bicycle-powered backyard rollercoaster that you can actually buy - Electrek.
"Australia will raise fees for foreigners who buy existing houses, while encouraging them to invest in build-to-rent projects that will boost the nation’s housing supply" - Twitter. There must be a more fundamental reason for the shortage.
"French Farmers Dump Manure On Govt Buildings To Protest Climate Hysteria" - Twitter.
"Elon Musk Appeals SEC Case To US Supreme Court, Alleges Violation Of Free Speech Rights" - Twitter.
A most magnificent example of a country turning socialist is France's government debt to GDP (blue) increasing from 20.8% in 1980 to 111.8% in 2022, as people vote for more free benefits. The UK (red) has risen to 102%. Germany (green) has declined to 66%.
Friday 8 Dec 2023
The Crippling Economic Costs Of Green Energy Subsidies - Zero Hedge.
Wednesday 6 Dec 2023
"AMD $AMD believes it has an advantage over Nvidia $NVDA with its new MI300 chips: The MI300 has more than 150 billion transistors, 1.6x the bandwidth and 2.4x the memory as Nvidia’s market leading H100." - Twitter.
The approximate earnings yield of the US stock market as corporate profits over the Wilshire 5000 index (blue) stayed close to the interest rate on government bonds (red) from 1981 to 2002. Since 2002 stock yields were much higher than bond interest rates. The yield for the S&P 500 for Q4 is expected to be 4.0% compared to bond yields of 4.8%.
Most of the profits are returned to shareholders as dividend and share buybacks. The S&P 500 market cap is now $35.94T (Ycharts). Share buybacks were $210.8B in Q3 (Prnewswire), which is an annualized yield of 2.3%. The dividend yield was 1.62% in Q3 (Ycharts).
In 2010 the dividend yield was about 2%, and buybacks slightly higher. Bond yields were around 3%. So less of the profits were returned to shareholders. The ratio of corporate dividends to profits has varied between 30% and 75%:
Sunday 3 Dec 2023
"If you google "why is climate change a hoax" or "is it real"? Google will give you pages of reasons why climate change is not a hoax & why. Google has become a mind conditioning, programming tool. Not a resource for inquisitive minds." - Twitter.
Saturday 2 Dec 2023
Trump promises 'largest deportation operation in US history' - Baha. He will lose the vote of the immigrants. In 2019 there were 50M (Wikipedia)
From 22 Nov: "The Dutch police releases crime statistics by country of origin. Accumulated over 10 years, they provide a fantastic dataset of 2 million data points." - Twitter.
Friday 1 Dec 2023
The S&P 500 was in a down channel since the peak of 31 July 2023, until it broke out upwards at the beginning of November. It has not returned to the all time high peak of 31 Dec 2021. Now it is close to forming a double top.
From 29 Nov: "Q4 earnings for the S&P 500 index are currently expected to be flat from the year-earlier level on +2.4% higher revenues, which would follow the +3.4% earnings growth in 2023 Q3 on +2% higher revenues" - Nasdaq. For no growth, the stock market is expensive on a price/earnings of 25.24, or yield of 4.0% (Multpl).
"Gold Price and U.S. Debt Since 1970" - Twitter.
"Watch @Tesla Cybertruck stop bullets fired from three different guns" - Twitter. Perhaps a prediction of where the decline in civilisation is heading.
The Cybertruck Is a Disappointment Even to Cybertruck Superfans - Vice.
Oil Production by Country - Worldometer: The United States is the largest producer.
United States Oil - Worldometer: "The United States has proven reserves equivalent to 4.9 times its annual consumption. This means that, without imports, there would be about 5 years of oil left (at current consumption levels and excluding unproven reserves)."
"NEW: Huawei, once almost crippled by US sanctions, made a dramatic comeback. With unprecedented state support, it's now leading China's efforts in chip independence" - Twitter.
"Inside the 'arms race' between YouTube and ad blockers" - Twitter.
"The city of Detroit and the Michigan Department of Transportation said crews have finished installing a wireless-charging public roadway." - Twitter.
All governments borrow more and more money, because the inflation they cause increases the cost of government's operations, like Canada's GDP (blue) and government debt (red).
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