Webpage moved to www.aandele.co.za
Thursday 6 Feb 2020
Closer look at Rivian’s electric delivery van for Amazon - Electrek.
On Twitter: The Insider Trader @AlessioUrban: "It was a “Merry Christmas” for everyone. Global retail sales collapsed in December": chart
Coronavirus: the cost of China’s public health cover-up - FT.
Coronavirus: 20 infected, thousands quarantined on Diamond Princess cruise ship in Japan - SCMP.
Wednesday 5 Feb 2020
On Twitter: The Insider Trader @AlessioUrban: "Trade war or weak consumer?": chart. Worse than 2009. High probability of a stockmarket collapse this year.
Jerome Powell & The Fed’s Great Betrayal - RIA.
Tesla Gigafactory production target was 500,000 vehicles for 2020 (Tesla). The Chinese production of 250,000 give a total around 750,000. The production capacity of the Gigafactory 4 in Germany is 750,000 at the third phase. So, years from now maximum production is 1.5M. The market cap of $160B is $107,000 per future car. If they make 5% net profit on a $35,000 car, then it will take 61 years to recoup the capital invested. The market for expensive electric vehicles seems limited.
Toyota sold 10.7M cars in 2019 (Toyota). Toyota's cheapest hybrid is $23,100 (Toyota), and cheapest fuel car $15,600.
Republicans are furious that Nancy Pelosi ripped up Trump's State of the Union speech as soon as he stopped talking - Business Insider SA.
Tencent may have accidentally leaked real data on Wuhan virus deaths - Taiwan News.
Coronavirus: cruise ship carrying 3,700 quarantined in Japan after 10 test positive - The Guardian.
Tesla delays made-in-China Model 3 deliveries due to coronavirus forcing factory shutdown - Electrek. It looks like China could lose two months of economic activity. That is going to bring down world economic growth.
On Twitter: Stare Decisis @MsResJudicata: "Men in Canada live to average of 80.9 years. Women in Canada live to average of 84.7 years. It could be better if they didn't smoke or use drugs. Men in USA live to average of 76.00 years. (USA's men don't need to save much for retirement?). Women in USA live to 81.00 years." Does the difference have to do with diet, temperature, or race?
Autonomous flying taxi Cora set for passenger trials in New Zealand - Engadget. Who wants to fly in a plane without a pilot to handle emergencies?
Scientists unravel mystery of photosynthesis - Science Daily.
Tuesday 4 Feb 2020
Chipotle Mexican Grill (CMG), restaurants, results: year revenue +14.8% (Q4 +17.6%), EPS +96% to $12.38 (Q4 +122% to $2.55), or adjusted +55% to $14.05, P/E = $884.82/$12.38 = 71, net profit margin up from 3.6% to 6.3%.
Walt Disney (DIS), cable & satellite, results: Q1 revenue +36%, shares +21%, EPS -37% to $1.17, or adjusted -17% to $1.53, P/E = $144.73/$6.09 = 24, total equity +0.9%, equity per share -16.7% to $52.51.
Seagate (STX) results: Q2 revenue -0.7%, EPS -9.6% to $1.20, or non-GAAP $1.35.
On Twitter: Michael McDonough @M_McDonough: "U.S. Real GDP -- Rebased to 100 in Jan. 2009 (start of the Obama administration)": chart. What a nice straight line, almost like the statistics are made up.
Ralph Lauren (RL) results: revenue +1%, EPS $4.41 compared to $1.48 a year ago, share price $124.87, total equity -5.2%, shares -6.7%.
Shale pioneer John Hess says key U.S. fields starting to plateau - Reuters.
Is Tesla The Greatest Short In History? - Talk Markets.
On Twitter: Cy Jacobs @Cy36ONE: "Tesla : Share price vs Outstanding short Interest - tells an interesting story of a serious squeeze !!" chart.
Worldometer: "Coronavirus Cases: 20,629. Deaths: 427". If the growth rate declines at 1% per day, then cases would peak at around 81,000 on 20 Feb.
With WTI oil at $50.70, what is the breakeven price for US shale, which has resulted in lower oil price, since the Brent $100 OPEC price fixing? From 21 May 2019: Breakeven Oil Prices Underscore Shale’s Impact on the Market - Dallasfed. The oil price is close to last year's breakeven.
Monday 3 Feb 2020
Alphabet Class A (GOOGL), Alphabet Class C (GOOG) results year revenue +18.3% (Q4 +17.3%), EPS +12.5% to $49.16 (Q4 +20.2% $15.35), P/E = $1482.60/$49.16 = 30.
On Twitter: Charlie Bilello @charliebilello: "Tesla Market Cap: $141 billion
Big 3 (GM/Ford/Chrysler) combined Market Cap: $110 billion
Revenue over past year...
Tesla: $25 billion
Big 3 combined: $425 billion"
The Tesla (TSLA) share price has shot up to $762. They are priced to become the biggest car seller in the world, and/or their autopilot the only successful product. Tesla's market cap is $137B, compared to Microsoft's $1325B. That is what can be achieved with a monopoly, and the product quality can be poor. When a share price becomes expensive, the company should issue more shares.
‘The results look good so far:’ Thai doctors tout promising treatment for Wuhan coronavirus - Fortune.
CDC Confirms 11th US Case In California; 195 Quarantined On Military Base: Virus Updates - Zero Hedge. Will Trump's unhealthy meat exports reduce resistance?
Eating red meat and processed meat hikes heart disease and death risk, study finds - Science Daily. Trump is trying to kill the Chinese with meat. "Fish, seafood and plant-based sources of protein such as nuts and legumes, including beans and peas, are excellent alternatives to meat and are under-consumed in the U.S."
On Twitter: David Ingles @DavidInglesTV: "Replying to @DavidInglesTV Lunch break in China! Man that morning session felt like years.
CSI 300 -8.17%
Iron Ore -8%
Palm Oil -7%"
Markets are dominated by speculators. Long term commodity prices are pushed up by inflation, and the demand is determined by economic growth (in China) and debt (in US).
Worldometer: "Coronavirus Cases: 17,408. Deaths: 362". Growth rate down to 19%, mortality rate 2.1%. One can assume that a lot of cases went unreported before due to a lack of lab test facilities.
On Twitter: Laurent Andrew @Laurenttrader: "Food for thought on OZ Property: Cash rate dropped from 18% in 1990 to .75% now and could be at 0 by the end of the year. Once we get to 0%, there have been 72 rate cuts over 30 years with no more left. Do investors think the next 30 yrs will be anything like the last?"
Sunday 2 Feb 2020
On Twitter: YUAN TALKS @YuanTalks: "#China's securities regulator CSRC has reportedly notified brokerages to suspend short selling of stocks from Feb 3, according to the 21st Century Business Herald."
This year seems destined to see a stock market collapse. So far there has been a conflict with Iran, and the Wuhan coronavirus. As the US forces China to switch from its existing suppliers to US suppliers, the trade war is likely to escalate.
What’s the price of a perfect smile? US teeth-straightening start-up SmileDirectClub aims to shake up Hong Kong’s dental industry with its online solution - SCMP.
Worldometer: "Coronavirus Cases: 14,631. Deaths: 305". Growth rate still 22%, mortality rate 2.1%.
On Twitter: Akki @akkitwts: "This is the best thing you'll see today": video.
Saturday 1 Feb 2020
On Twitter: Holger Zschaepitz @Schuldensuehner: "It looks as if #globalization will suffer another setback due to the coronavirus. The Baltic Dry Index, a kind of barometer of globalization, has fallen to its lowest level since 2016." chart.
Worldometer: "Coronavirus Cases: 11,948. Deaths: 259". Growth rate has slowed to 22%, mortality rate 2.2%.
Friday 31 Jan 2020
On Twitter: Time for Tea @Monkey_Charts: "#OOTT November crude oil & condensate production change m/m (1000 b/d): chart
+18 Russian Fed
-149 OPEC14 (secondary sources)"
The Brent oil price has fallen to $56.35 apparently because of lower expected demand due to the coronavirus. The oil price is determined by US shale, and they probably require a WTI price near $70.
Caterpillar (CAT), construction machinery & heavy trucks, results: year revenue -1.7% (Q4 -8.4%), outstanding shares -5.3%, EPS +4.7% to $10.74 (Q4 +10.7%), P/E = $135.37/$10.74 = 12.6.
Worldometer: "Coronavirus Cases: 9,821. Deaths: 213". Growth rate has slowed to 26%, mortality rate 2.2%. Mortality rate for flu appears to be around 0.13%. Global mortality associated with seasonal influenza epidemics - NCBI: "We estimated an average of 389,000 (uncertainty range 294,000-518,000) respiratory deaths were associated with influenza globally each year during the study period, corresponding to ~ 2% of all annual respiratory deaths".
"It's Crazy" - Global Run On Virus Masks Leaves US And Europe With No Supply - Zero Hedge.
Paper on human transmission of coronavirus sets off social media storm in China - SCMP.
Thursday 30 Jan 2020
On Twitter: Sam Ro @SamRo: "Rich people own stocks. Poor people own houses." chart chart
Visa class A (V) results: Q1 revenue +10%, EPS +12% to $1.46, P/E = $198.97/$5.48 = 36.
Amazon (AMZN) results: year revenue +20.5% (lowest growth since 2015), EPS +14.3% to $23.01 (+7.1% fourth quarter), P/E = $1870.68/$23.01 = 81, price/sales = $1870.68/$557 = 3.4. Total shareholder equity $123.1 per share little stored value share price determined by profits, and the price is on a very high 81 PE.
US STEEL (X) results: net sales -8.8%, EPS loss -$3.75 (fourth quarter -$4.00), restructure charge = $1.60, price/sales = $9.40/$75.47 = 0.12. Import tariffs have apparently not helped for long.
On Twitter: Jim Bianco @biancoresearch: "PUBLISHED infection and mortality rates for the coronavirus are much larger than SARS/Swine Flu, at the same point. 14 days in Coronavirus infections surpassed the total 60-day total for SARS. Coronavirus mortality about to exceed the 60-day total for Swine Flu (next 2 days)": chart chart.
7,000 people held on cruise ship in Italy as Wuhan coronavirus fears spread - CNN.
Coronavirus outbreak: The countries affected - Parmaceutical Technology. "A total of 7,783 (7,678 cases in mainland China and 104 cases outside China) confirmed cases of novel coronavirus infection including 170 deaths have been reported across the world as of 29 January 2020."
There is rumour going around that the US economy is growing at 2.1%. In the third quarter nominal economic growth was 3.8%, which leaves inflation of 1.7% (at constant money velocity). For the third quarter, S&P 500 revenue growth was +3.8%, which agrees with nominal economic growth as it should. However, profits declined -0.4%. It is typically a sign of high inflation putting pressure on costs. At constant volume, sales inflation was 3.8% and with a net profit margin of say 10% cost inflation was 4.7%. If volume declined, as is usually the case when consumers are under pressure, inflation is higher. It look like inflation is closer to 6%, which means the economy shrunk -2%.
California lost more manufacturing jobs to China than any other state, report says - LA Times. If you receive a lot more goods as imports, than what you are exporting, then you are benefitting. The standard of living in California has probably been boosted the most by cheap imports than any other state, through high-tech exports.
Why Britain Brexited - The Atlantic. Brexit is about keeping non-white immigrants out that arrived through the EU. Residents of the colonies were free to move to the UK, until they started to arrive from Pakistan and the West Indies. Then immigration was restricted.
E. Jean Carroll, who says Donald Trump raped her, seeks his DNA - USA Today.
Modern Africans and Europeans may have more Neanderthal ancestry than previously thought - Phys.org.
On Twitter:Lijian Zhao @zlj517: "Updates: Latest video on the construction progress of the first #Coronavirus hospital or #Huoshenshan hospital in #Wuhan. @CSCECNEWS" video. Amazing what can be achieved without the burocracy of a democratic government.
Wednesday 29 Jan 2020
Facebook (FB) results: year revenue +26%, EPS -15% to $6.43, P/E = $223.23/$6.43 = 35, price/sales = $223.23/$24.2 = 9.2, shareholder equity +22% to $35.14 per share.
United Rentals (URI), rental of construction equipment, SEC: revenue -1.0% or +14.8%, shares outstanding -6.9%, EPS +15% to $15.12 ($15.73 in 2017), P/E = $152.26/$15.12 = 10.1.
Netflix (NFLX) results year revenue +28%, EPS +54% to $5.13, P/E = $343.16/$4.13 = 83, price/sales = $343.16/$44.61 = 7.7.
Tesla (TSLA) results: Q4 revenue +2.2%, EPS -58% to $0.58, or non-GAAP +12% to $2.14, year EPS -$4.92, price/sales = $580.99/$139 = 4.2. Model S/X production and deliveries down -29%, model 3 production +42%, deliveries +46%. The share is priced for a big increase in production.
Cirrus Logic (CRUS), semiconductors, results: Q3 revenue +15.5% (down -19.5% from two years ago, and -28% from three years ago), non-GAAP P/E = $81.61/$3.68 = 22, price/sales $81.61/$20.53 = 4.0.
Hologic (HOLX), Health Care Equipment, results: revenue +2.4%, non-GAAP EPS +5.2%, non-GAAP P/E = $54.65/$2.47 = 22.
Microsoft Corp (MSFT) software, results: revenue +14%, EPS +40%, or non-GAAP +37%, P/E = $168.04/$5.74 = 29.
Automatic Data Processing (ADP), Internet Software & Services, results: Q2 revenue +5.1%, EPS +18% to $1.50, P/E = $171.39/$5.84 = 29.
On Twitter: Liz Ann Sonders @LizAnnSonders: "Quite the offset: in FY2019, U.S. tariffs (paid by U.S. companies importing good from China) caused surge in customs duty collections & reduced average real household income by $1,277… @USCBO estimates tariffs will reduce U,S, real GDP by 0.5% & raise consumer prices by 0.4% @WSJ": bargraph.
On Twitter: Liz Ann Sonders @LizAnnSonders: "63 U.S. cities don’t have enough money to pay their bills ... here is which ones top the list
US airstrikes in Afghanistan hit ten-year high in 2019 - WSWS.
Oppose French unions’ attempts to strangle the struggle against Macron! - WSWS.
China coronavirus: Hong Kong professor Yuen Kwok-yung says effectiveness of drugs could be judged within weeks, with tests due to start in city - SCMP.
Live: Wuhan makeshift hospitals construction underway - Ep.4 - GNTN: "Confirmed cases: 5,997 in China, 64 abroad. Deaths: 132
Apple (AAPL) per share summary: net assets $20.10, revenue $60.08, profits $12.66, share price $317.69. On an earnings yield of 4.0%, after paying 1% dividend, they have 3% left for share buybacks. Apple's $1393B market cap works out to $10,600 per 131M full time US employees. An iPhone 11 costs $700 to $1100. Net profit margin is 21%, thus on average $190 per phone. To make back the capital invested, they will have to sell an iPhone to every US worker every year for the next 56 years.
Tuesday 28 Jan 2020
Apple (AAPL) first quarter: revenue +8.9%, profit +11.4%, EPS +19.4%, shares outstanding -6.7%, PE $317.69/$12.66 = 25. Total shareholder equity is down -1.1%, but up per share to $20.10 (net asset value per share). The dividend yield is 4x $0.77/$317.69 = 1.0%. When expensive products sell this well, it must be a sign of people living it up on debt.
Starbucks (SBUX) results revenue +7.0%, shares outstanding -5.0%, EPS +21%, PE = $85.92/$3.06 = 28.
eBay (EBAY) PR Newswire: revenue +0.5%, EPS -18%, PE $36.21/$2.09 = 17.3.
Advanced Micro Devices (AMD) results, semiconductors, revenue +3.9%, EPS -6.3% to $0.30, or non-GAAP +39% to $0.64, PE $50.53/$0.64 = 79, price/sales = $50.53/$6.01 = 8.41.
Carnival Corp (CCL), hotels, resorts & cruise lines, SEC, revenue +11.0%, EPS -2.7%, shares outstanding -2.5%, PE $46.49/$4.32 = 10.8.
United Technologies (UTX), aerospace & defense. SEC. Revenue +15.9% , EPS -1.4%. PE $151.03/$6.41 = 24.
Xerox Corp (XRX). SEC revenue -6.2%, continuing EPS +136%, PE $35.05/$2.78 = 12.6.
Is inflation understated? - Parlia. It is impossible for so much debt to go into an economy, and not cause inflation.
This one thing may be raising your risk of getting Alzheimer’s - Market Watch.
China coronavirus: only one correct way to wear mask, says Malaysian mythbuster. Here it is - SCMP. In many countries the masks are sold out. This is how badly prepared governments are for a pandemic the moron politicians the public vote for.
Coronavirus: China death toll climbs to 106 with first fatality in Beijing – live updates - The Gaurdian. Confirmed cases 4515.
If the corona virus does spread worldwide, that will have a big impact on all economies not due to the virus infections, but the people avoiding public places, and staying home.
US companies reporting so far show low or negative revenue growth, but big increase in profits. Usually that implies lower volume, and high sales price increases, which means high inflation.
On Twitter: Pee-wee Herman @peeweeherman: "TIL: There are ROADS specifically built to play MUSIC when you drive over them!!! Yes, SINGING ROADS!! This one in Hungary is the newest... But there are MORE ALL OVER the world: https://peewee.com/2020/01/28/roads-that-are-built-to-play-music-when-you-drive-over-them-yes-singing-roads/ Magyar Építok": video.
Monday 27 Jan 2020
On Twitter: Martin Enlund @enlundm: "Maybe the Wuhan virus is what will finally solve central banks problem of too low inflation. (I sure hope not). Wars (and influensas) do look inflationary... (& deglobalizationy). http://ndea.mk/fxweekly": chart.
On Twitter: Wilshire 5000 @W5000: "Wilshire 5000 Drops $525 Billion, Worst Day in 5 Months"
Whirlpool (WHR) SEC. Revenue -2.9%, EPS $18.45 much higher than past 10y, shares outstanding -4.5% (-1.2% Q4), PE $148.23/$18.45 = 8.0.
D.R. Horton, Inc., America’s Builder, Reports Fiscal 2020 First Quarter Earnings and Declares Quarterly Dividend of $0.175 Per Share - Business Wire.
On Twitter: AndreasStenoLarsen @AndreasSteno: "The Wuhan-virus makes it even more unlikely that China will be anywhere nearly able to comply with 2020 purchase targets in the Phase 1 trade deal. The topic will be back with a vengeance, it's just a question of whether it will be before or after the US Presidential election.": chart.
On Twitter: ISABELNET @ISABELNET_SA: "Federal Tax Revenue. This chart puts into perspective the sources of federal tax revenue since 1940. https://isabelnet.com/?s=tax. h/t @SoberLook #tax #revenue #federalgovernment #taxes #taxpolicy #US #fiscalpolicy #economics #economy": chart. Corporate taxes are passed on as higher prices on products, as profit is required to exist as business. Since people keep voting for the same politicians, they do not mind paying taxes or paying higher prices.
On Twitter: Investing.com @Investingcom: China #Coronavirus Cases:
Jan. 17: 41
Jan. 19: 62
Jan. 20: 201
Jan. 21: 291
Jan. 22: 440
Jan. 24: 830
Jan. 25: 1,287
Jan. 26: 1,975
Jan. 27: 2,835
Wuhan was quarantined 22 January. People were probably infected before preventative measures started, since the incubation period varies from 2 to 14 days. How many labs can test for the virus?
From 24 Jan 2020: Coronavirus Detection Test in the Works for Wuhan - Genengnews.
From 25 Jan 2020: Singapore biotech firm Veredus expects to have Wuhan virus test by Feb 1 - The Business Times.
On Twitter: David Ingles @DavidInglesTV: "Coronavirus updates: - China says death toll at least 80 (from 56), confirmed cases rose to 2,744
- U.S. confirms fifth case, - Taiwan confirms fourth case, - China to extend new year holiday past January 30"
Do viruses originate in China because of lower resistance? Differential Mortality Rates by Ethnicity in 3 Influenza Pandemics Over a Century, New Zealand - NCBI. "The Maori death rate in the 1918 pandemic (4,230/100,000 population) was 7.3× the European rate. In the 1957 pandemic, the Maori death rate (40/100,000) was 6.2× the European rate. In the 2009 pandemic, the Maori rate was higher than the European rate (rate ratio 2.6, 95% confidence interval 1.3–5.3)." U.S. Influenza (Flu) and Pneumonia Death Statistics - Livestories. Asian or Pacific Islanders had lower deaths. Influenza-Associated Pediatric Deaths
in the United States, 2010–2016
- Pediatrics AAP Publications. Deaths per 100,000 chidren was the same for White and Asian Americans, but 4.9x higher for Native Hawaiian and/or Pacific Islander.
The FRED chart below shows both copper in blue and gold in red was suppressed from 1996 to 2004, and then shot up to where they probably should have been given the increase in debt in purple and money supply in green. The debt is 3.3x bigger than the money supply than shown on this chart. The economic development of China might have contributed to the higher copper price after 2005.
Sunday 26 Jan 2020
On Twitter: "Global Times @globaltimesnews: "#Breaking: 33 out of 585 samples collected from a Wuhan seafood market tested positive for the novel coronavirus, suggesting the virus originated in wildlife sold there, the Chinese Center for Disease Control and Prevention told CCTV. #WuhanCoronavirus"
On Twitter: Holger Zschaepitz @Schuldensuehner: "Just to put things into perspective: The Coronavirus epidemic has a likely huge impact on tourism from #China to the rest of the world, ADMISI's Ostwald says.": chart.
On Twitter: marc friedrich @marcfriedrich7: "To raise the world GDP from 2010 to 2019 up $20 trillion the world created $50 trillion new debt. That means for $1 growth we spent $2,50 - sustainable? Now we are at 322% debt to GDP or $255 trillion." chart. The debt is being written off through inflation, which impoverishes people who's assets and income are not protected against that inflation. Passing the buck of money creation until the poorest pay for it.
On Twitter: Jack Scott @JackPScott: "This is a mind-bending picture. Might be chart of the new decade. #Debtdoesntmatter" chart.
On Twitter: Otavio (Tavi) Costa @TaviCosta: "Corrosive all together. Utilities consistently burn cash with record debt and atrocious valuations. 14-Day RSI is now at its highest level since the mid-90s. A flight-to-safety trap.": chart. As inflation bites, people are forced to pay for services which are difficult to reduce, like electricity and water consumption.
N95 Virus Masks Sell Out Across The U.S. - Zero Hedge.
The fatality rate for SARS was 9.5%, MERS (Middle East respiratory syndrome coronavirus) was 34% (WHO, Wikipedia), and so far for Wuhan coronavirus 2.8%. The number of infections for all coronaviruses has been tiny compared to the world population.
Will Coronavirus Crater Hopes Of A Global Recovery As World Trade Tumbles? - Talk Markets.
Schiff calls Trump 'vindictive' and says Trump's tweet was intended to intimidate - CNN.
Saturday 25 Jan 2020
On Twitter: Lyn Alden @LynAldenContact: "Some people are pointing out that the Fed's balance sheet expansion went flat so far in January (left image). However, the amount of T-bills held outright continues to increase rapidly (right image). Why? Because the excessive supply of T-bills is the source of the problem." chart chart.
On Twitter: St. Louis Fed @stlouisfed: "Do government dollars drive recovery? The FRED Blog connects some dots between government spending and the severity of recessions" link.
The mass protests in Iraq and the US drive to recolonize the Middle East - WSWS.
Can lithium halt progression of Alzheimer's disease? - MedicalXpress.
Scientists In Britain May Have Just "Accidentally" Found A Cure For Cancer - Zero Hedge.
Transmission of communicable diseases on aircraft - WHO. "The recirculated air is usually passed through HEPA (high-efficiency particulate air) filters, of the type used in hospital operating theatres and intensive care units, which trap dust particles, bacteria, fungi and viruses." Study examines how diseases really spread during air travel - Pri.
Friday 24 Jan 2020
On Twitter: Wilshire 5000 @W5000: "Wilshire 5000 Tumbles $350 Billion, Worst Day in 3 Months; Nets $400 Billion Loss for Week".
Skyworks Solutions (SWKS), semiconductors, revenue -7.8% lower, EPS -6.3% lower, with -3.4% less shares: SEC. It trades on a high PE of $117.30/$4.78 = 25.
Air Products & Chemicals (APD), industrial gases, revenue +1.4% higher, EPS +36% higher: SEC. It trades on a high PE of $223.74/$8.51 = 26.
KB Home (KBH) revenue +0.1% higher, EPS +67% higher: SEC.
China coronavirus: A visual guide - BBC.
Coronavirus claims 15 more lives in China; first three cases reported in Europe; first case reported in Australia; 2 cases confirmed in U.S. - Washingon Post.
Virus-hit Wuhan has two laboratories linked to Chinese bio-warfare program - Washington Times. People usually blame other animals: bats, birds (bird flu), pigs (swine flu), monkeys (HIV), rats (Black Death Bubonic Plague).
Clinical features of patients infected with 2019 novel coronavirus in Wuhan, China - The Lancet.
Elizabeth Warren clashes with Iowa father who calls her student loan policy unfair - Yahoo News.
Mexico detains 800 Central American migrants headed to US - SCMP.
On Twitter: Eunice Yoon @onlyyoontv: "China restricts 16 cities pop. 46mln!" That is only 3% of the population.
Tesla’s Global Deliveries Compared to the Top 10: Volkswagen, Toyota, GM, Ford, Honda, FCA, Mercedes… Here’s the Chart - Wolf Street.
Tallest Residential Building In The World Reveals New Details—Including 100th-Floor Amenity Level Overlooking New York City - Forbes.
Thursday 23 Jan 2020
Procter & Gamble (PG), personal products, revenue +4.6% higher, EPS +16% higher: SEC. It trades on a 6m PE of $126.08/~$5.54 ~ 23. Revenue recovery after years of decline. EPS mostly $3.50 to $5.50 for 10 years.
Fourth quarter results - Intel. "Full-year revenue set an all-time record of $72.0 billion, up 2 percent YoY on data-centric growth"
On Twitter: Roberto Mulazzi @robertomulazzi: "S&P500. A look at the flows": chart.
Spreading Coronavirus Forces Lockdown of More Chinese Cities - WSJ.
On Twitter: Roberto Mulazzi @robertomulazzi: "Central Banks Balance Sheets and S&P500": chart.
On Twitter: Tom McClellan @McClellanOsc: "A chart from my most recent newsletter, helping to illustrate what the Fed's overnight repo interventions mean. They are wonderful while they are happening. But every time the Fed tries to unwind, it gets ugly for stock prices (just like unwinding QE).": chart.
On Twitter: Jason @JasonChing20: "Replying to @LukeGromen. That might be inaccurate. Fed’s money printing powers are limited by inflation consequences." Don't worry, governments have solved that nasty little problem by not declaring the actual inflation rate. Politicians do whatever it takes to be elected.
On Twitter: Squawk Box @SquawkCNBC: "We may not see oil prices at $100/barrel “for a long time” says Chevron CEO Michael Wirth $CVX". From 9 May 2019: The Shale Boom Is About To Go Bust - Oil Price. Data Around Slowing US Shale Oil Production - Gorozen.
Wednesday 22 Jan 2020
On Twitter: Peter Boockvar @pboockvar: "Who in their right mind is buying negative yielding bonds you ask? Americans, many I'm sure in their 401k, via the Vanguard Total International Bond ETF, ticker symbol BNDX. It's biggest holding is a German bund maturing on August 15th 2029 and currently yielding -.29%."
TI reports Q4 2019 and 2019 financial results and shareholder returns - Texas Instruments. "Revenue decreased 10% from the same quarter a year ago".
'It's not a crime': French unions threaten more power cuts after huge Paris blackout - The Local Fr.
On Twitter: Mohamed A. El-Erian @elerianm: "With the Administration's #trade policy focus remaining on bilateral deficits, a @WSJ chart on how these have evolved over time. The data shed light on why President @realDonaldTrump and cabinet members sent a clear warning to #Europe today in #Davos2020 . #economy #markets": chart. The US has a trade deficit because of capital inflow. The Trump approach to eliminating the trade deficit is going to make it bigger. Import protection and subsidies strengthen the dollar, which attract more capital.
Gimme Shelter – Unlocked RIA Pro - RIA.
On the FRED chart below the stock market in red has moved away from corporate profits in green and total debt in blue (scale adjusted for alignment before 1995). It is similar to the period up to the bubble of 2000. Profits (green) have flattened out since 2012, which is a decline relative to everything else, like money supply or economic output. After profits (green) flattened out towards 2002, it did recover.
The FRED chart below shows corporate profits as percentage of economic output in green. It is historically high, and is declining from near 12% towards 8%. Such high profit margins are usually associated with a high inflation, as a result of high debt growth. Debt growth in blue has been relatively low since 2010, compared to the high growth rates before 2008.
Tuesday 21 Jan 2020
IBM Trades Higher On Q4 Earnings Beat - Talk Markets. "This is a 3.29% decrease over earnings of $4.87 per share from the same period last year".
Boeing Tumbles After Admitting More Delays On 737 MAX, FAA Says "No Timeframe" For Return - Talk Markets.
On Twitter: Jeff Lee @JeffLee2020: "After Blowing $43 Bn on Share-Buybacks in 6 Years, Boeing Scrambles to Borrow $10 Bn, on Top of a $9.5 Bn Credit Line in Oct, to Fund its 737 MAX Fiasco by Wolf Richter • Jan 20, 2020"
Netflix Burns A Record $19 Million Per Day As Growth Slows; Q1 Forecast Disappoints - Zero Hedge.
IONITY Fail: Charging Now Costs Over Double The Price Of Gas - InsideEVs. Cheap solar power (where there are no import tariffs) is ideal for electric cars, because it already has a battery, which otherwise is the big drawback to solar power.
GM Cruise unveils self-driving electric car for ride-sharing - Electrek.
On Twitter: Sven Henrich @NorthmanTrader: "The madness of our time in one chart." chart. The Swiss has decided not to stay neutral.
On Twitter: Lance Roberts @LanceRoberts: "Hmmmm...Corporations are now leveraged more than at any other point in history. Nothing wrong with leverage while markets are rising, however, it's like gasoline. It's all inert until somebody drops a match into it." bargraph.
The US China trade agreement must be the most ridiculous agreement in human history. All other countries sign bilateral trade agreements. The Spaniards traded cigarettes for South American gold. At least it was a trade.
The media and the stock market respond to virus infections. China had 8098 cases of SARS, causing 774 deaths in 37 countries (Wikipedia). Lightning kills 24,000 people per year (ResearchGate). In 2018 405,000 died of Malaria (WHO). Deaths by cause Wikipedia: tuberculosis 1,210,000 per year.
New robotic dog is cheaper and cleaner - Popular Mechanics SA.
Remember that Sonos speaker you bought a few years back that works perfectly? It's about to be screwed for... reasons - The Register UK. Government that is supposed to regulate is too busy handing out benefits to voters.
Monday 20 Jan 2020
After Blowing $43 Bn on Share-Buybacks in 6 Years, Boeing Scrambles to Borrow $10 Bn, on Top of a $9.5 Bn Credit Line in Oct, to Fund its 737 MAX Fiasco - Wolf Street.
Repo Market END GAME Finally Revealed! (Can YOU Handle The Truth?) - Youtube.
Global Central Banks Fueling a Ponzi Market - Guggenheim.
On Twitter: Daniel Lacalle @dlacalle_IA: "Buybacks need to be monitored as companies’ buyback strategies are always pro cyclical." chart. Dividend yield and share buybacks decline as share prices rise. At some stage profits will also decline. It did in the third quarter.
On Twitter: IZ @siddiqui71: "$AMD" chart.
How Boeing’s Responsibility in a Deadly Crash ‘Got Buried’ - NY Times.
Sunday 19 Jan 2020
On Twitter: Peter Schiff @PeterSchiff: "I just lost all the #Bitcoin I have ever owned. My wallet got corrupted somehow and my password is no longer valid. So now not only is my Bitcoin intrinsically worthless; it has no market value either. I knew owning Bitcoin was a bad idea, I just never realized it was this bad!": image. Blockchain is supposed to provide a record. That doesn't work either.
On Twitter: FXHedge @Fxhedgers: "580 U.S farms went bankrupt in 2019 because of purchase losses to China, but Trump won't mention that". Same thing happened during the Great Depression of the 1930s.
Amid protest, Tesla signs Gigafactory 4 contract; access road starts construction - Electrek.
Saturday 18 Jan 2020
On Twitter: Lyn Alden @LynAldenContact: "November data for foreign holdings of U.S. treasuries is out now. Foreigners held $40B less UST in November than they did in October, and down $118B from August peak. There's not enough global demand for UST despite persistent UST supply, so the Fed is buying instead."
Investors Face "Grave Danger" - Wait 30 Years For Nothing Or Lose 67% Now - Zero Hedge.
944 Trillion Reasons Why The Fed Is Quietly Bailing Out Hedge Funds - Zero Hedge.
On Twitter: David Larew @ThinkTankCharts: "Put Call - Yep - Bubble in the markets - Long equities and no protection at the all time highs - Fist full of cash and Dec 2018 was sooooo last year. Hedge funds would never short a parabolic bubble, right? We have the orange report Mr. Beeks, so get in there and buy, buy, buy :)": chart.
On Twitter: Sven Henrich @NorthmanTrader: "The kiss of death": Barron's cover StockCats @StockCats: "Beware the Barron's Cover": Barron's cover 2017.
On Twitter: jeroen blokland @jsblokland: "Today’s scary chart! US price-to-sales ratio (ht @zerohedge)": chart.
Market Continues “Euphoric” Advance As 3500 Becomes Next Target - RIA.
On Twitter: Liz Ann Sonders @LizAnnSonders: "In the next four decades, the number of elderly people per 100 working-age people will nearly triple—from 20 in 1980 to 58 in 2060 @VisualCap": chart/A>
Pictures surface of Tesla Model Y third-row seats, and they don’t look large - Electrek.
How can a period of prosperity be followed by poverty, as in an economic depression? A lot of wealth accumulates, like luxury homes. Kitchens that are a little old are gutted, and replaced with shiny new cabinets and marble tops. How could these wealthy home owners become poor?
Why It Happened - Digital History. "Why did the seemingly boundless prosperity of the 1920s end so suddenly?" "Consumers built up an unmanageable amount of consumer installment and mortgage debt". "A poor distribution of income compounded the country's economic problems. During the 1920s, there was a pronounced shift in wealth and income toward the very rich." "Republican tariff policies damaged the economy by depressing foreign trade".
The US and EU have responded to the economic development in Asia with their big populations with import protection and debt. People have borrowed in the hope that they will be able to pay the debt in the future. In the future they might not have the right qualifications to generate enough income to repay the debt. Savers (lenders) hope that they will get back the same value of money in the future, which is not going to happen due to inflation.
The Great Depression in Global Perspective - Digital History. "In the Soviet Union, the Great Depression helped solidify Joseph Stalin's grip on power." Russia has become a dictatorship again, with support from Donald Trump.
The Human Toll - Digital History. 'President Herbert Hoover declared, "Nobody is actually starving. The hoboes are better fed than they have ever been." ' Some cities appear to have more hoboes.
US Housing Starts in blue on the FRED chart below shows a lot of sharp moves up or down. The interest rate is in red.
Friday 17 Jan 2020
The Fed Won’t Avert The Next “Crisis,” They Will Cause It. - Advisor Perspective.
Opinion: Social Security’s not keeping up with inflation — here’s what that means for you - Market Watch.
Hyundai And Kia Invests $110 Million In Arrival Commercial EVs - InsideEVs.
On Twitter: ISABELNET @ISABELNET_SA: "Trade Deal. This chart shows exports to China with trade targets, under the phase-one trade deal ?? https://isabelnet.com/?s=China. h/t @SoberLook @OxfordEconomics": chart. Exports to other countries will fall, and countries that lose exports to China will lodge a complaint.
On Twitter: Snippet Finance @SnippetFinance: "Health and Education have grown as a percentage of US Economy. #health #education #employment #economics #USEconomy #investing #stocks #finance https://snippet.finance/health-and-education/" chart
China 2019 crude steel output jumps 8.3%, sets second straight annual record - Reuters.
Hundreds of thousands protest pension cuts in France - WSWS.
On Twitter: Guillermo Valencia @GMacrowise: "Is Palladium a predictor of Nasdaq prices?" chart.
This Pet Rabbit Got Her Own Seat in Business Class and Spent the Flight Eating Croissants While Wearing a Bowtie - Travel and Leisure. This indicates a market top.
Something happened to rail freight during the Great Recession, and it has not recovered. Who's in charge of rail? The FRED chart below also provides a clear marker for the economic decline in 2016. Unlike most government statistics which is quoted relative to inflation, this measures actual physical units, again showing the official inflation rate does not reflect reality.
The FRED chart below tries to match Rail Freight Carloads in blue to Real Gross Domestic product in red, and nominal economic output divided by M3 money supply in green. Which looks closer? It is possible that some of the money flow disappears into informal businesses, particularly services, which is not picked out as economic acivity. It that case the ratio of gross domestic product to M3 money supply would decline, and the need for rail freight also decline.
Thursday 16 Jan 2020
Antiaging Treatments that are Closest to FDA Approval - Next Big Future.
On Twitter: Lisa Abramowicz @lisaabramowicz1: ' “It’s very hard to be bearish here,” says an investment strategist as US equities hit new highs and Alphabet joins Microsoft and Apple in having a $1 trillion valuation.' Sounds like every other bubble, like 1929.
On Twitter: Bloomberg Next China @next_china: "The EU says says the preliminary U.S.-China trade agreement might violate WTO rules". The US forces China to buy from them instead of other suppliers.
When it comes to central economic planning like Trump is trying to do, it is important to provide for enough toilet paper. You don't want people standing in line for toilet paper like in the old Soviet Union. So nevermind 5G and Huawei, just order enough toilet paper.
On Twitter: Lance Roberts @LanceRoberts: "Mexico is going to be buying a 'Yuge' amount of goods." It didn't happen. "Europe is going to be buying a 'Yuge' amount of goods." It didn't happen. China won't happen. Most likely, purchases will roll back to where they were in 2017 before the "Trade Nonsense" started.": bargraph.
Tesla responds to Gigafactory 4 protests by swiftly opening community office - Electrek. Will Tesla manufacturing be profitable in Germany?
The Federal Reserve is the cause of the bubble in everything - FT. Low interest rates is usually the symptom not the cause. The cause is big government wasting taxpayer money on unproductive expenditure; interfering in the free market with import duties, subsidies, and financial bail-outs; lack of infrastructure development (bigger cities, more expensive housing, instead of building more cities); wasting money on wind energy; inaction against monopolies and other limitations on market access; and outdated expensive education due to a lack of competition. Not reporting the actual inflation rate also leads to low interest rates, and investment into unproductive assets (housing).
The Shangai Composite index and Hang Seng is down after the signing of the unilateral US to China export deal.
US China trade agreement
The word "trade" means an exchange of goods. The agreement is all about China imports. There is no word on what the US will import. China is unlikely to be able to buy the required quantity of goods on the US shopping list, and Trump will end up looking delusional.
Chapter 1. Intellectual property.
Trade secrets lead to a lack of competition and higher prices. It should only be protected to pay for research and development. Since China is likely to develop more in the future, they will have more trade secrets, which they are now compelled to keep secret. Piracy and counterfeiting is obviously illegal. What is a bigger problem is poor quality legitimate products, like the precorded DVDs sold by the US.
Chapter 2. Technology transfer.
Why bother to operate in another country if you don't want to transfer technology?
Chapter 3. Trade in food and agriculture.
"tariff-rate quota (TRQ) administration should not be employed as a means of preventing the full utilization of agricultural TRQs"? You mean slow administration? How are quotas managed without administration?
Annex 1. Agricultural Cooperation. Agricultural cooperation is positive.
Annex 2. Dairy and Infant Formula US milk imported into China.
Apparently there a demand for milk in China: USDA: "EU countries, led by Germany, account for over 50 percent of the fluid milk import market share in China. ... New Zealand is also a major fluid milk importer and accounts for 35 percent of the market. Due to favorable tariff treatment under the New Zealand-China Free Trade Agreement, imports from New Zealand will continue to grow. While Australia also enjoys preferential tariff treatment under its free trade agreement ..."
Annex 3. Poultry - US poultry imports into China.
"For those U.S. poultry and poultry products imported into China prior to January 1, 2015, China shall, within 30 days of the date of entry into force of this Agreement, issue, based on its previously-conducted assessment of the U.S. regulatory system, a final decision on whether to permit the importation of the product." Who wants poultry that is more than 5 year old?
It looks like the US want to export its unhealthy diet to China: Beef, Live Breeding Cattle, Pork, Meat, Poultry and Processed Meat.
"The following is a list of products that are not eligible for importation into China, including when incorporated into further-processed products: (a) beef and pork: thyroid glands, adrenal glands, uropygial glands, tonsils, major lymph nodes exposed during slaughter and cutting, laryngeal muscle tissue, lungs, pancreas, spleen, gallbladder, uterus, hair, hoofs, and lactating mammary glands; (b) horns from cattle; (c) mechanically separated beef and distal ileum from cattle of any age; (d) brain, skull, eyes, trigeminal ganglia, spinal cord, dorsal root ganglia, and vertebral column (excluding the vertebrae of the tail, the transverse processes of the thoracic and lumbar vertebrae, and the wings of the sacrum), from cattle 30 months of age and older; and (e) feathers, heads, intestines, and tails of poultry." Just stop eating meat.
Chapter 4. Financial services.
"China shall accept the license application of such U.S. supplier, including any license application of Mastercard, Visa, or American Express". Make the duopoly great again.
Chapter 5. Macroeconomic policies and exchange ratematters and transparency.
"Each Party confirms that it is bound under the International Monetary Fund (IMF) Articles of Agreement to avoid manipulating exchange rates or the international monetary
system in order to prevent effective balance of payments adjustment or to gain an unfair competitive advantage." Countries price exports unfairly through import tariffs and subsidies which strengthen their currency. If other countries want to sell products cheaper, go ahead, as long as it is sustainable.
Chapter 6. Expanding trade (in one direction).
"The Parties acknowledge that trade and economic structural changes resulting from this Agreement and from other actions being taken by China to open up its economy and improve its trade regime should lead to improved trade flows, including significant increases in exports of goods and services to China by the United States and other countries". "During the two-year period from January 1, 2020 through December 31, 2021, China shall ensure that purchases and imports into China from the United States of the manufactured goods, agricultural goods, energy products, and services identified in Annex 6.1 exceed the corresponding 2017 baseline amount by no less than $200 billion". There is actually a catalogue of products provided (without prices) which China is to buy.
Wednesday 15 Jan 2020
Backlash Over Meat Dietary Recommendations Raises Questions About Corporate Ties to Nutrition Scientists - Jama Network. "... several studies showing that the evidence linking red meat consumption with cardiovascular disease and cancer is too weak to recommend that adults eat less of it".
Peter Schiff: Americans Are In For A Rude Awakening - Zero Hedge. Countries with big debt are likely to have weak currencies over the coming decades, in the absence of an industrial revolution. Both the US and China (and the Eurozone) have big debt. The probability of China advancing further seems higher.
Trump Gets His Trade Deal, China Gets the Win - NY Times. The trade deal does not make sense if it goes against the free market flow. Presumably China has not bought from the US because products are too expensive. Will China force the public to pay more? US exports can only become more price competitive by importing more, and that is being prevented by import tariffs and subsidies. Trump never mentions what the US will import. That makes trade impossible. What deals are in the U.S.-China trade pact signed Wednesday? Read the full text - Market Watch.
Drinking 1% rather than 2% milk accounts for 4.5 years of less aging in adults - MedicalXpress. It is unclear whether "less aging" means living shorter or longer. Is Whole Milk Better Than Low-Fat and Skim Milk? - Healthline: "Not only is there no scientific evidence proving that the saturated fat in whole milk causes heart disease, but several studies have shown that drinking whole milk is associated with health benefits." With these medical studies it might be difficult to distinguish between cause and effect. People who are generally health conscious, exercise, and try to stay slim, could be drinking skim milk, and that is why they live longer.
Target sales weakness could be warning sign ahead of tomorrow's retail sales report - Forexlive.
Yeah…But - RIA.
On Twitter: Squawk Box @SquawkCNBC: Mnuchin: "Tax cuts will pay for themselves over 10 years": image. Best article ever: How “Voodoo” Caused Most of the National Debt - Zfacts.
Trump administration said to be moving toward blocking more tech sales to China’s Huawei - SCMP. Contradicts Here’s How Mastercard Sidesteps The U.S. Anti-Tech Campaign - Forbes. "However, last week Huawei noted that its newest Mate 30 smartphone did not have any U.S.-made components."
Orders At Boeing Drop To A 16-Year Low - Talk Markets.
Tesla's vehicle deliveries by quarter - Statista. Sales increase from Q1 to Q4. If the Q4 growth rate of 23% persists, 2020 sales would be 450,000. Gigafactory production target was 500,000 vehicles for 2020 (Tesla). The Chinese production of 250,000 will likely boost sales due to a lower price, to give a total around 700,000. After the initial excitement, sales will probably flatten out everywhere. The production capacity of the Gigafactory 4 in Germany is 750,000 at the third phase.
Will the US-China trade deal be signed with pens made in China?
Beans, Beans for Every Meal/ - Modern Farmer. Sounds windy.
Tuesday 14 Jan 2020
Inflation at 7.3% and growth at 5% — is Indian economy facing stagflation? - The Print. A lot of countries have stagflation, but India appears to report the inflation rate.
Senators Propose $1B to Outpace Huawei in 5G. That's Small Change - Wired. People outside the US will feel more secure with Huawei products than US products, because the US government has already demonstrated a tendency to spy on the public.
Global debt shattering records: IIF - Reuters. "The amount works out at around $32,500 for each of the 7.7 billion people on planet and more than 3.2 times the world’s annual economic output, but the staggering numbers don’t stop there."
Strategist’s Handbook: Chart Updates - Yardeni.
Phase 1 commodity targets likely more than China can chew: analysts - Reuters. This type of economic planning was typical of the old Soviet Union. Deciding in advance which products countries will buy is ridiculous. The US trade deficit has declined since August. Perhaps a sign of capital leaving the US, as during the 2008-9 Great Recession.
On Twitter: Peter Schiff @PeterSchiff: "After the voting age was lowered to 18, Democrats bought the votes of students by offering govt. guaranteed loans so they could take the summers off instead of working to pay for college. The result was soaring tuition and students working their entire lives to repay the loans!" Governments gain support by offering benefits, for which they later print money, and charge the public through inflation which they under report. Elizabeth Warren vows to cancel student debt for 95% of borrowers on her first day in office - Market Watch. Let the poor people who didn't go to college help pay for it.
CitiGroup Fourth Quarter and Full Year 2019 Results. Q4 revenue +7.3% and year 2019 +2.0%, share buybacks -10.8%, Q4 EPS +31% to $2.15 and year +20% to $8.04, or Q4 adjusted +4.4% to $1.90.
Wells Fargo sinks more than 3% after fourth-quarter profit gets cut in half - CNBC.
JPMorgan beats estimates on strong trading, underwriting - Reuters. "Net revenue rose 9% to $29.21 billion."
Yuan rises as US lifts China's currency manipulator label - CNN. Any country that limits imports through import tariffs or subsidies is in fact manipulating the value of its currency.
Amazon will ask a court to block Microsoft from working on a $10 billion cloud computing contract - CNN.
Volkswagen's market cap is €91.853B, for 2019 sales of €249B, and 6,278,300 vehicles sold.
Tesla's market cap is $94.603B, for 2019 sales of $24.4B, and 367,500 cars sold.
Monday 13 Jan 2020
On Twitter: Liz Ann Sonders @LizAnnSonders: "Heading into start of Q4 2019 earnings season, 107 companies in S&P 500 have issued EPS guidance; of which 73 have issued neg guidance (< 5y avg) & 34 have issued pos guidance (> 5y avg) @FactSet": graph. Stock market valuations are going in the opposite direction.
Why Are Volcanoes All Over The Globe Suddenly Shooting Giant Clouds Of Ash Miles Into The Air? - Zero Hedge. Has volcanic activity been increasing? - Valocano.si.edu: "The Global Volcanism Program does not see any evidence that volcanic activity is actually increasing."
Thunderstorms to bring rain and new risks for bushfire-affected NSW - SMH. Hot rising air holds more moisture, and smoke seeds the clouds for rain. Rains starts the new growth, and carbon dioxide absorption cycle. Australia's bushfire smoke will do a full lap of the earth: NASA - SMH.
The assassination of Qassem Suleimani and the criminalization of US state policy - WSWS.
Fired CEO Dennis Muilenburg gets $80.7 million on exit from Boeing - WSWS.
Tesla Shares Climb Past $500 After Oppenheimer Boosts Price Target - The Street. The market cap is now $93,260M. Car sales were 112,000 for the fourth quarter. The China Gigafactory has a capacity of 250,000. If sales for 2020 reaches 700,000 then the market cap is $133,000 per car. If Tesla makes 5% net profit on a Tesla 3 selling for $35,000, the share price/profit would be about 76.
On Twitter: Ronnie Stoeferle @RonStoeferle: "Doesn’t sound like a big deal, but this has hardly ever happened in the past without a recession following. Here the deviation from the 2-year average": chart.
Sweden’s bombing wave continues with explosions in Stockholm and Uppsala - Eturbonews.
Frequent flyer: the hassle of European train travel - FT.
Oscars: Netflix Leads All Hollywood Studios With 24 Nominations - The Holywood Reporter.
On Twitter: Holger Zschaepitz @Schuldensuehner: "Ouch! #China car sales fell 8.2% in 2019 to 25.77mln vehicles, data from countries Auto Industry Association shows. December was the 18th down month out of the past 19, the group said. China 2019 New-Energy Vehicle Sales declined 4.0% on year, plunged 27.4% in Dec YoY." graph. Cars is a more recent phenomenon in China than in developed countries, and appear to have reach saturation.
Usually governments print money to pay debt, especially when the debt is too big to repay otherwise. At what rate must money be printed to pay off US total debt of $74,559B (assuming more financial bail-outs)? M3 money supply was $15,195B in October 2019, and grew 6.7% over a year. At that rate it would take 37 years (debt growth halted, 2% interest on debt). If the money supply growth of 6.7% creates some economic growth of say 2%, then the rest would be inflation of 4.7% (at the same velocity of money flow). The increase in the standard of living would be the economic growth of 2% (ignoring population growth), if wages grew at 6.7%, which it doesn't (average hourly wages +2.9% for Dec). If wages fall behind by -2.6% per year, then after 37 years the standard of living would be 26% of what it is today. The public isn't worried, they vote for more debt. Live it up now, pay later.
Sunday 12 Jan 2020
Vanguard and the US financial system: too big to be healthy? - FT.
On Twitter: Adam Tooze @adam_tooze: "Between the extremes of Greece (mainly foreign official) and Japan (overwhelmingly domestic), the share of foreign and domestic bond ownership and ownership by banks and nonbank varies dramatically. @DeutscheBank via @SoberLook": graph. The Greeks knows how to exploit the system. Live on borrowed money, and with the backing of the ECB, at low interest rates.
Saturday 11 Jan 2020
"There’s Almost No Chance of a Recession This Year, Experts Say. Here’s Why" (subscription) - Barrons. Let's see how well that ages. The US economy has actually declined relative to the money supply since the Great Recession of 2009.
Institutions, Retail And Algos Are Now All-In, Just As Buybacks Tumble - Zero Hedge.
On Twitter: St. Louis Fed @stlouisfed: "See the long-term trend in U.S. consumer credit owned by depository institutions, the federal government, finance companies and credit unions": FRED. Them debt are small compared overall debt. Looks like the consumer is trying to be responsible whilst debt is blowing up around them. Consumers and bond holders are going to end up paying for most of the debt through inflation.
Tesla vehicles are ‘soon’ going to talk, Elon Musk releases preview - Electrek.
PACCAR's Kenworth And Peterbilt Partner On EVs With Dana - InsideEVs.
Chronicling History's Greatest Financial Bubble - Credit Bubble Bulletin. "Central bankers are not only trapped, the situation is so dire that they have no choice but to move early and aggressively to ensure Bubbles can’t begin deflating (no corrections or adjustments allowed)."
People need to prepare for another depression, which has probably started already. It could be a very slow process that lasts for decades. Unlike the Great Depression, there won't be deflation, because economists believe that caused the depression. Instead governments will increase debt and print more money. Everybody will become poorer relative to the actual inflation rate. Most people do not realize their standard of living is declining due to inflation. First the descretionary spending declines, causing retailers to go bankrupt. Governments don't recognize the inflation they are causing, so government spending increases, which is either paid for by taxes that rise because it is not adjusted for the actual inflation rate (bracket creep), or governments borrow, or finally print the money (Zimbabwe, Venezuela).
The S&P 500 is now more overvalued than ever, per this measure - Market Watch.
Invasion and interference are the true face of America - SCMP.
Instagram says it's removing posts supporting Soleimani to comply with US sanctions - CNN. It is against the constitution.
On Twitter: Tulsi Gabbard @TulsiGabbard: "My heartfelt condolences & love to the families of victims of plane “crash” in Iran. One of the great tragedies of war are unintended consequences & so-called "collateral damage." Once hostilities begin things quickly get out of control & no one knows where it may end #NoIranWar"
Friday 10 Jan 2020
'You're better off sleeping in your car': How Paris is plagued by scourge of bed bugs - The Local.
The Wall Street Journal (and Other Media) Should Stop Lying About Repos - Wolf Street. The amounts mentioned seem small compared to Fed assets of $4,149.5B, up $380B from the low point.
Millions march in France as strikes against Macron pension cut spread - WSWS.
The Democrats pass Pelosi’s phony antiwar resolution - WSWS.
On Twitter: David Rosenberg @EconguyRosie: "The bear market is in... fundamentals! The share of listed companies in the U.S. that have lost money over the past year has risen to 40%, the highest since the dotcom bubble of the late 1990s."
On Twitter: The Great Martis @great_martis: "Apple: The pull back will be brutal" chart.
On Twitter: CNN Business @CNNBusiness: "JUST IN: The US economy added 145,000 jobs in December, the Bureau of Labor Statistics said Friday. The unemployment rate remained steady at 3.5%, which is a historic low." There appears to be problem with the statistics. As mentioned a few months ago: The US population increased by 3.19 million in 1999. Twenty years later the number of extra adults who need to find work, is about 266,000 per month. It is more if people live and work longer than 20 years ago. If 145,000 jobs are added, but the number of adults increased 266,000, then 121,000 should be added to the unemployed.
The media gets excited about stock market indexes reaching new highs. That just means inflation is going up.
On Twitter: Daniel Lacalle @dlacalle_IA: "US. Jobs under Trump's administration (35 months): 6.69 million. Jobs created under Obama (8 years): 8.9 million (11.5 million from the bottom if we consider lost job recovery within job creation). Wage growth is the key factor to the improvement in the labor market." chart. Will the jobs created pay for the cost of creating these jobs, for example the debt? Sometimes governments create government jobs to increase employment, but the contribution to the economy is questionable.
UK Retail Industry Sees Worst Year Ever In 2019 - Zero Hedge. Probably because EU citizens have left the building.
Dow Jones - DJIA - 100 Year Historical Chart - Macrotrends. This chart show the DJIA rose from 954 in Dec 1920 to 5655 Aug 1929, up 5.9x. Then it fell to 810 Jun 1932, a drop of -86%. It looks like the same wealth creation through asset bubbles, which had to be corrected by the Great Depression. The bubble is now bigger.
These assets bubbles are similar to the landlords becoming wealthy and peasants poorer during the Middle Ages. History keeps repeating itself.
Boeing workers mocked regulators over 737 Max approval - FT. Plane design has not changed fundamentally forever. The industry requires more competition to spur innovation.
Backfire In The Persian Gulf: Petro-States Go Mute On Soleimani Assassination - David Stockman's Contra Corner. People in the Middle East will remember the assassination for the next 100 years.
Dishwashers - Snippet.
Prince Harry and Meghan has escaped the UK, using a plan code-named Houdini (as in Harry Houdini). They want to use North America as home base for their masterplan to take over the kingdom. Watch out for the new movie release "Escape from Windsor" at a cinema near you. If you liked the movie "When hairy Harry met merry Meghan", you will love this one.
The FRED chart below shows for the last 10 years, and the periods leading up the previous two recessions an exponential increase in debt. For as long as interest rates are not raised to suppress the growth, it grows faster and faster. This is how inflation runs away. Whatever is included in this total debt, it is now $74,558,521M/152M = $490,000 per worker.
Thursday 9 Jan 2020
Beautiful image of the moon made with 100,000 photos - Popular Mechanics SA.
A Soft Landing in 2020? - St Louis Fed
House votes to limit Trump's military action against Iran without congressional approval - CNN. "Now that the resolution has passed the House it will next go to the Senate." And presumably the president must sign it?
Fed Adds $83.1 Billion in Short-term Money to Markets - WSJ. Based on the principle of supply and demand for money, this would be a sign that supply is insufficient, and interest rates must rise.
Usually debt and inflation run away until interest rates increase to suppress it. The S&P 500 has risen 14% per annum since March 2009. If this is used as the base, corresponding to economic output, and the market is allowed to stay at the present level, then inflation + economic growth needs to rise to 14% per annum for the period. When government wastes money, there is usually no real economic growth. Workers will be further impoverished, just like the Great Depression of the 1930s.
On Twitter: Agathe Demarais @AgatheDemarais: "Striking graph - US imports from #China continue to drop, reaching lowest level since 2013 in November #tradewar (@economics)": chart. If imports decline, then exports must also decline.
On Twitter: Liz Ann Sonders @LizAnnSonders: "According to @Deloitte CFO Signals Survey, 82% of CFOs anticipate taking defensive actions this year, such as reducing discretionary spending & headcount; 77% say stocks are overvalued while only 4% believe they are undervalued"
Have these people gone crazy for Mickey Mouse? 10,000 people applied for unpaid jobs at Disney - Market Watch.
It looks like the S&P 500 could be topping out short term, probably because it has run out of short sellers closing their positions. There remains long term investors who are going to chase every last cent of dividend and share buyback in a desperate attempt to beat negative real return everywhere else.
Trade war tariff threat, rising costs drives Hong Kong manufacturer to automate Chinese factory to survive - SCMP. When cheap labour uses robots to make it even cheaper, the expensive labour in other countries (due to big interfering government) has no chance.
Wednesday 8 Jan 2020
The Case Against Economists - Daily Reckoning.
First-Quarter Deficit Grew by 12%, CBO Projects - The Fiscal Times.
The Staggering Cost of US Health Care Bureaucracy - The Fiscal Times.
Bed Bath & Beyond Inc. Reports Results For Fiscal 2019 Third Quarter - Bed Bath & Beyond.
Investing Versus Speculating - RIA. The yield on value stocks is too low to beat the actual inflation rate. The market cannot beat inflation because debt must be repaid. After the Great Depression of the 1930s followed big new technological advancements which provided high economic growth. The ability of developed economies to progress through another level of industrial revolution is being stifled by government.
Nearly 250 million workers strike in India to protest Modi's economic policies - Daily Sabah.
On Twitter: Jesse Felder @jessefelder: 'Short sales in the SPDR S&P 500 ETF Trust, known by its ticker SPY, as a percentage of shares outstanding fell to 1.1% Tuesday. That’s the lowest level since January 2018, before the event known as “Volmageddon” sent stocks swooning.' https://bloomberg.com/news/articles/2020-01-08/five-charts-raise-red-flags-with-stocks-brushing-aside-tensions ht @Peter_Atwater: chart. The chart suggests more traders go short of the S&P 500 index after it has fallen, and less go short when it is at high levels. That is illogical. What makes more sense is that the short sellers are contributing to the opposite move in the S&P 500, in other words the present closing of short positions helps to push the market higher.
On Twitter: Daniel Lacalle @dlacalle_IA: "US. Money supply growth is soaring while GDP growth estimates are coming down. The accumulation of risk should not be considered irrelevant.": chart.
On Twitter: ISABELNET @ISABELNET_SA: "S&P 500 Valuation. Is the US stock market overvalued? The equity capitalization-to-GDP ratio hits new all-time high": chart.
On Twitter: MarketWatch @MarketWatch: ' "For long-term investors, stocks still represent good value." Wharton finance professor Jeremy Siegel lays out his bull thesis for 2020': video. Comparing stocks with fix income investment ignores the fact that both are likely to deliver returns below the actual inflation rate. The downside risk for stocks is now much higher than the upside.
Can Six Myths Keep The Market Going? - Real Investment Advice.
It looks like Iran's military actions might be restricted by religious believes, or they are limiting casualties to reduce the chances of retaliation. For a small country like Iran to take on the US military makes no sense. They would be better off spending their money on economic development. The US military budget works out to $693,000M /152M = $380 per month per worker, which is about 9% of the average wage.
Unbeknownst to Trump, Jeannie and Captain Nelson is in Baghdad at this moment to restore her powers. Hopefully this important mission won't be interrupted by a mindless war.
Iran strikes US bases in Iraq as Pentagon deploys B-52 bombers - WSWS. Investors have been waiting for trigger to start a stock market collapse. The B-52 is ancient technology, but if the stock market starts falling it could be self sustaining, and this only 8 January. Just think of all the negative news the rest of 2020 can provide. Trump has the type of personality that could lead to a third world war – acting on the spur of the moment without considering the long term consequences.
Dividends By The Numbers In December 2019 - Talk Markets.
Ukranian Whistleblower Reveals MH-17 Tragedy Was Orchestrated By Poroshenko And British Secret Service - Zero Hedge.
On the FRED chart below, Japan's M3 money supply is compared to US M3 money supply in red (up to 2016). Japan printed more money than the US up to 1995, but the Yen strengthened against the dollar. If there is a lot more yen, you would expect to get more yen for one dollar. Since 1995 the US money supply has grown faster, without much of a change in the exchange rate. Exchange rates are actually determined by inflation, but inflation is usually dominated by the amount of money created. Perhaps Japan's economy became more efficient up to 1995 (lower inflation), and less efficient since (high inflation).
Tuesday 7 Jan 2020
The US propaganda machine justifies the assassination of Qassem Suleimani - WSWS.
Iran missile attacks target U.S. forces in Iraq; Trump says 'All is well!' - Reuters. What Iran’s missile attack on U.S. forces in Iraq may say about the Islamic Republic’s ballistic capability - Market Watch. Nothing done so far has reduced the violence in Iraq, would should be the goal.
On Twitter: TheStreet @TheStreet: "Breaking - Impossible Foods says it cannot produce enough of its 'meat' to partner with McDonald's $MCD". They said it is impossible.
When a company borrows money to pay dividends or buy back shares (equivalent to a dividend), it is like a Ponzi scheme. They are borrowing from A to pay B. Dividends paid beyond the profits to boost the share price no longer constitute the running of a legitimate business. When the stock market collapses, you know lawyers are going to look for reasons to sue.
On Twitter: Mark J. Valek@MarkValek: "Mid-East Situation in 10 sentences": image. The animosity all started when Isreal was created in 1917. People are fighting over deserts.
Government Conspiracy As Japan Moves To Arrest His Wife - Zero Hedge. Whether Ghosn is quilty or not, one has to question how far Japanese culture has evolved since the attack on Pearl Harbor and the US occupation.
On the FRED chart below corporate dividends in blue are still rising (up to 2018), despite profits in green going sideways. The Wilshire 5000 index on an arbitrary scale in red has moved away from everything. During the previous deviation of profits and stock market index before the 2001 recession, dividends did not decline, and a big percentage of the profits were paid out as dividends (green and blue lines close together), which might have support share prices. We probably have a repeat now, with high dividend payments, and companies pushing up their share price by buying back their shares. All, or more than, the profits are being used to boost the share price. There is a delay in the dividend payments relative to profits. The market did eventually collapse into the recession of 2001. If dividends decline because of declining profits, the stock market could collapse. The rise in share prices means fewer shares can be bought back with the same profits.
Monday 6 Jan 2020
On Twitter: Win Smart, CFA @WinfieldSmart: "Buybacks": chart.
Rome Is Banning Souvenir Stalls at Many Tourist Attractions to 'Protect' the City's Heritage. The hawkers will be fed to the lions.
On Twitter: Ron Paul @RonPaul: "The Very Same People Are Lying Us Into War Again. Watch the whole show here": Youtube.
On Twitter: zerohedge @zerohedge: "China will not increase annual grain import quotas to accommodate higher US farm purchases: China Vice Agricultural Minister via Caixin. So a Phase 1 deal is physically impossible."
On Twitter: Charlie Bilello @charliebilello: "Here are the top 30 stocks in the S&P 500 over the past 30 years. You'll never guess #1." table.
Iran Air Flight 655 - Wikipedia. "In 1990, Rogers was awarded the Legion of Merit "for exceptionally meritorious conduct in the performance of outstanding service as commanding officer [...] from April 1987 to May 1989." The award was given for his service as the commanding officer of Vincennes from April 1987 to May 1989. The citation made no mention of the downing of Iran Air 655" in 1988.
On Twitter: BLS-Labor Statistics @BLS_gov: "Inflation-adjusted earnings in motor vehicles and parts industry down 17 percent from 1990 to 2018 https://go.usa.gov/xpz5v #BLSdata": chart.
House To Vote On Limiting Trump’s Military Powers In Iran Amid Escalating Tensions - Forbes.
Amazon partners with India's second largest retailer to sell its goods online - TechCrunch.
On Twitter: Otavio (Tavi) Costa @TaviCosta: "Opportunities abound. The world goes mad but energy service stocks remain unprecedentedly cheap relative to overall equities. A mean reversion move implies a 200% rise in this ratio.": chart. Individual companies don't look attractive.
According to Google search suggestions, the phrase "Escape from Tarkov" and "Escape from Pretoria" is more popular than "Escape from Alcatraz". In the future the phrase "Escape from Japan" could become popular. Escape from Pretoria is a movie to be released "based on the real-life prison escape by three young political prisoners from jail in South Africa in 1979" (Wikipedia). Today the settlers who created Pretoria are escaping in much larger numbers, because the black natives are destroying it.
The FRED chart below compares the European Union Total Manufacturing Production index in blue on an arbitrary scale, with M3 Euro money supply in green, and Central Bank Assets in red. Neither has done much for manufacturing. The way politicians try to manage an economy is almost comical.
Sunday 5 Jan 2020
Fisker Ocean unveiled, $29,999 base w/credits, performance version 0-60 in 2.9s - Electrek.
Stocks could see a double-digit drop in the coming months, warns Wells Fargo - Market Watch. Governments are trying everything to keep the bubble going. Debt needs to keep growing to overcome the (actual) inflation caused by the debt growth. Workers face Great Depression type poverty when it is all over.
Will Stock Markets See A Minsky Moment In 2020? - Talk Markets.
Mexican president brags that his government hasn’t approved mining concessions - Mining. "According to Hernández, communities are worried about the possible impacts of such operations on the local fauna and water resources".
Iran pulling out of nuclear deal commitment after U.S. strike that killed Soleimani - NBC News. It makes sense for Iran to have nuclear weapons as protection against the US.
2020 Minimum Wage Hikes To Help Or Hurt Economy? - Talk Markets. Minimum wage increases add to inflation. It often peaks long before recessions as the grey bands on the FRED chart below. The growth rate is low compared to money supply growth in red, and debt growth. The wage growth (blue) is close to the official inflation rate in green, which suggests that the official inflation rate measures affordability.
On the FRED chart below, Commercial and Industrial Loans, All Commercial Banks (TOTCI) in red seems tiny compared to All sectors debt securities and loans in blue.
Saturday 4 Jan 2020
Gone but not forgotten: 6 retailers that collapsed in the 2010s - USA Today.
On Twitter: Charlie Bilello @charliebilello: "US Home Price Appreciation by City...": table. There is contradictory information on house price inflation. Inflation measurement should take into account the size and location of properties, otherwise it measures affordability. When standard of living decreases, people buy smaller, or in cheaper neighbourhoods.
Ghosn saga creates awkward questions for Japan - SCMP. "Japan’s judicial system has a 99 per cent conviction rate"
Inside the plot by Iran’s Soleimani to attack U.S. forces in Iraq - Reuters. The US invaded Iraq in 2003, found no weapons of mass destruction, and is still occupying it 17 years later.
Friday 3 Jan 2020
The decade of socialist revolution begins - WSWS. Politicians have always been bullshitters. Governments hand out money (cheap debt, tax cuts, import tariffs, subsidies, social or medical benefits) so the public feel prosperous, to win their support. The majority of the population is too stupid to release they end up poorer, because it makes the economy less efficient.
How 2019 Changed Migration At The Southern Border - Zero Hedge.
Supercharging tomorrow: Team develops world's most efficient lithium-sulfur battery - TechExplore.
9 amazing camper concepts foreshadowing cushier RV life in the 2020s - New Atlas.
Drinking lingonberry juice may help lower high blood pressure - New Atlas.
On Twitter: Holger Zschaepitz @Schuldensuehner: "#Fed balance sheet has risen another $8bn in the week to New Year as Powell keeps printing press rumbling to calm repo mkt. Total assets have gained a whopping $414bn since the 2019 low in August. Balance sheet now equal to 19.4% of US GDP.": chart.
Interest rates are usually determined by the supply and demand for money. When interest rates are too low, the demand increases, and supply falls. The US and EU has responded to this by having the reserve bank supply the money. It looks like there is upward pressure on interest rates, but governments are ignoring it. By not raising interest rates to suppress the demand, debt has kept growing. This leads to inflation, and then usually lenders (savers) insist on higher interest rates as compensation for the high inflation. Because governments are no longer reporting the actual inflation rate, as they would lose voter support if they reported recessions, inflation keeps going up.
From 19 Mar 2018: The staggering death toll in Iraq - Salon.
From 7 Feb 2019: How The CIA Overthrew Iran's Democracy In 4 Days - npr.
On Twitter: Joe Kunkle @OptionsHawk: "Has to be a coincidence...": Impeachment vote in House delayed as Clinton launches Iraq air strike citing military need to move swiftly. Countries with weapons are similar to mass shooters. When people have weapons some-one is going to use it.
From 27 April 2015: Obama launches 2,800 strikes on Iraq, Syria without congressional approval - Washington Times.
Tesla destroys expectations, announces record deliveries of 112,000 cars - Electrek. Tesla Has Reached 3000 Per Week Production Run Rate in China - NextBighFuture.
On Twitter: Viv @flcnhvy: “Tesla is going to put 1000s of these cars on the road. But what really matters is: are we making a difference to the world? And for us to make a difference to the world, we have to make a lot of cars. Until we see every car on the road being electric, we won’t stop” — @elonmusk. One advantage of electric cars that are charged with solar power at home, is that you don't have to pay for fuel, or pay tax on investment income to buy the fuel (for those who live on investments). Everybody should strive to be more independent of the economy, avoid taxes and the government's spending of tax payer's money to buy support.
Australia fires: furious residents jeer PM Scott Morrison when he visits ravaged town - SCMP.
On Twitter: John P. Hussman @hussmanjp: "Yesterday, U.S. stock & bond market valuations pushed to extremes that now imply total returns of just 0.25% on a passive asset mix (60% stocks, 30% bonds, 10% T-bills), for over a decade. The glorious "passive" returns you see in hindsight now rest on an extreme worse than 1929." chart. Most people might to realize what returns they are getting relative to actual inflation.
On Twitter: Charlie Bilello @charliebilello: "S&P 500 dividends hit a new high in the 4th quarter, up 7.2% over the prior year. $SPX": chart.
On Twitter: Charlie Bilello @charliebilello: "S&P 500 annualized dividend growth rate... 1990-1999: +3.5%, 2000-2009: +3.4%, 2010-2019: +10.4%": chart.
FRED actually has a US dividend chart from 1929 to 2018, shown here relative to US economic output. It is higher than in 1929 before the Great Depression. What does that mean? Usually when more than 6% of the economic output is distributed as dividend, other yields like interest rates and inflation are also very high. It could be an indication of the biggest bubble for more than a century. Big debt is being distributed as dividends, which workers must now pay for through inflation.
Thursday 2 Jan 2020
Processed foods are a much bigger health problem than we thought - Vox. "...sugar and lack of fiber..."
Oil prices skyrocket, stock futures sink after top Iranian general killed by U.S. airstrike - Market Watch. On Twitter: zerohedge @zerohedge: "Pentagon statement confirms Trump issued the order to kill Soleimani": Text.
The stock market’s rally to start 2020 means it will take the average worker a record 114 hours to buy one unit of the S&P 500 - Market Watch.
On Twitter: Tom McClellan @McClellanOsc: "On Tuesday I discussed in my Daily Edition the noticeable peak in the Annual Seasonal Pattern equating to Jan. 2. Now we get to see if the January decline appears this time, as has become quite prevalent in recent years." chart.
On Twitter: Wilshire 5000 @W5000: "Wilshire 5000 Kicks Off 2020 with Record High, Builds on Strong 2019 with $275 Billion Gain".
On Twitter: Hipster @Hipster_Trader: "Imagine if the market topped on the first day of the year. That’d be funny." Stock markets are not going up on fundamentals.
Victoria’s Secret parent and The RealReal are 2020 picks as investors start to ‘play offense’: Wells Fargo - MarketWatch.
On Twitter: Jesse Felder @jessefelder: "$AMD now trades at triple its dotcom mania peak valuation with revenue growth today roughly half of what it was back then." chart. Michael Batnick @michaelbatnick: "Am I doing this right?": AMD chart.
On Twitter: zerohedge @zerohedge: "AAPL's market cap increase TODAY was bigger than the entire market cap of 300 S&P500 companies". A measure of limited market access. Why are there not hundreds of competitors?
Scientists Warn: Battery Components May Become A New Type Of Oil - InsideEVs. Doesn't appear to have any impact on battery prices.
On Twitter: Modern Farmer liked 100% Goats @EverythingGoats: "GOATS": video.
The US dollar has not strengthened against the traditionally weak currencies of developing countries for a number of years. The FRED chart below compares the US M3 money supply growth rate in red, with the Euro in green, China in purple, and India in blue. They are converging. In the past it was worth holding US$ or € because the strength compensated for low interest rates. If other countries offer higher interest rates in a currency that remains as strong, then there is another reason for upward pressure on interest rates.
Wednesday 1 Jan 2020
Stocks Have Been Cheaper - Talk Markets. The question is why are bond holders willing to lose money with interest rates below inflation? The average person spends about a third of their income on housing, so the 6% annual increase on same house prices since 2013 adds 2% to inflation, which already matches the official CPI of 2.1% in November. Another 17% is spent on medical expenses, which grew by about 5.7% (Statista). The remaining 50% of expenses are unlikely to be much lower, so overall inflation is probably near 6%.
'Hundreds' of cars torched during New Year's Eve mayhem in Strasbourg, France - Scott.net. Not covered by the main media.
EGEB: France, Thailand launch single-use plastic ban on New Year’s Day - Electrek. Manufacturers package goods in cardboard boxes for shipment to retailers. After unpacking, the cardboard is sent to be recycled. It seems wasteful to use cardboard for just one journey. Re-usable plastic boxes would make more sense. Glass bottles might cost more than the content, but is not re-used.
"I'm Not Recommending Anyone Use It": First 5G Rollout Fails To Live Up To The Hype - Zero Hedge.
On Twitter: St. Louis Fed @stlouisfed: "FHFA’s house price index—a broad measure of changes in single-family home prices—edged up 0.2% in October after jumping 0.7% in September. From a year earlier, the price gain was 5.0%": link. "The purchase-only index is based on more than 6 million repeat sales transactions on the same single-family properties." The annual inflation rate on the same properties averaged around 6% since 2013:
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