The banking industry reported strong quarterly results. The few missteps were Citi Group with their guidance and Germany's largest bank, Deutsche Bank.
On the positive side American Express had a record quarter. Bank of America was very profitable. It had an exceptionally strong report. Recently, two large regional banks joined forces to create the 6th largest banking concern in the US. BB&T allied with Sun Trust as a merger of equals. Even in this low interest rate environment US banks have found a model that works for them. The future, however poses new obstacles and challenges.
Internet
The corner bank and its branch network in shopping centers throughout the nation face a challenge with internet banks. Due to low overhead these digital tellers can offer a higher interest return to depositors. I don't see this as a big problem because people get an internal relief that drowns the fears around the stability of a lending institution by seeing an actual business. With all the dangers of hacking, a friendly teller trumps a half-of-a-percent interest. In addition, your corner bank does offer internet banking.
With that said, there are other and more dangerous problems looming on the horizon.
Consumer
With very few exceptions most home mortgages are made through the government by either Fannie Mae or Freddie Mac. This is a huge loss of business for the banking institutions. To try to salvage some of this "credit money," banks are getting into lines of credit lending for income. This is very profitable and one of the streams that are providing the current success for the banks. Banks are still the first option for small business, but as I reveal, this is dangerous territory.
Anyway, the US consumer is spending. Visa and Master Card are two hot stocks. At present, the consumer is buying autos. Last year(2018) was the fourth straight year in which over 17 million new cars were sold. Sounds great except the average price of the vehicle is now over $30,000. Dear Reader, in the 1970s you could buy the average home for that figure. This tells you many things amongst which the purchasing value of the dollar continues to decline and with it, the ability of the US consumer to maintain a standard of living. It too is also declining. In the 1970s it was common to purchase a auto with cash. Auto loans were for 36 months. Today, very few car sales are for cash. The length of an auto loan has been extended for 84 months. This is a terrible trend. As we have heard recently in the news with the federal employees being furloughed, even employed citizens with good jobs cannot get bye with missing one pay check. People are taking from Peter to pay Paul. This could cause a hiccup to lending institutions.
It gets worse. The consumer has run up a tab of $4 trillion when you combine credit cards, auto loans and student debt. This spending in the last five years is up 25%. Now, has the income equally rose the same percentage? No! Of course, not! The US consumer is in dangerous territory which means there will be defaults on the horizon. Speaking of which, currently, there are 7 million auto loans delinquent by 90 days according to Bank Rate.com. That figure translates to trouble in Big City.
Corporate
Our CEOs have done a poor job of leading our economy during the recovery from 2007-08. Corporate debt is $9 trillion and rising. Spending shareholder money on buybacks rather than research will come back to bite our nation. We have invented solar, but do not lead in the field. We developed PCs, but had them built on foreign soil. NAFTA killed 12 million manufacturing jobs. The same could be said about the textile industry, food industry, furniture, etc. Our iconic brands like GE, IBM, AT&T have low rated bonds at BBB and many companies are floating on debt. We hear that some emerging markets cannot service their debt like Venezuela. How far are we when our national debt climbs one trillion per year? It is now $22trillion! Next year, 23Trillion! I know that this is off the subject, but I feel that all things are related. So add this, there is possible collateral damage from derivatives. In 2007 the total swap market was $61 trillion. Today, it passes $120 trillion. This is unsustainable!
Potential Bankruptcy
This is another aspect that has the banking institution on the hook. The following are corporations that will possibly join Radio Shack and the Doo-doo bird. Keep in mind the name appears once, but these are chains which represent thousands of workers and millions in debt.
*Office Depot *Pier 1 Imports
*Land's End *Neiman Marcus
*99 Cents Only *Bebe
*Mattress Firm *Destination Maternity
*Guitar Center *Stein Mart
*Bon-Ton *Vitamins Shoppe
*BKH Acquisition Corp. *David's Bridal
*Fred's Pharmacy *Winn-Dixie's operator, Southeastern Grocers
*Nine West *Tops Market
*Cole Haan *Charlotte Russe
*Claire's *Full Beauty Brands
*Pet Smart *Bluestem Brands
*Eddie Bauer * Payless
How many more do you need? The retail crisis will disrupt our economy with thousands being unemployed and banking looking to the Federal Reserve to bail them out, again. If all that is scary consider that AI(robotics) will eliminate 25% of manual labor. The present economy is performing well, but a little further out there, dark clouds are forming.
Wednesday, February 20, 2019
Wednesday, February 13, 2019
Digital Bytes
The majority of reporting companies for the earnings season is over. I rate it as a mixed bag. I will go further to offer my view for the year based on a sample of reports by corporations, the volume of traded shares and price action on the charts.
Many corporations posted good earnings, and yet, they gave poor guidance like Northrop-Grumman. On the flip side some firms had a weak quarter, but gave a strong guidance like Hershey. Keep in mind that some of the earnings of companies that beat expectations was due to previously lowering their guidance. CEOs are trying to manipulate the market to keep their evaluations high. Nothing new here.
The main reason for my conclusions on the market, and thus, the economy is based on three factors. One, the potential trade war between the US and China. Their could be moments of peace, but a leopard cannot hide its spots. There is something within the Chinese culture that allows the people in their culture to make a buck off someone else. By this I mean the Chinese copy products and they use the perception of the buyer when offered a inexpensive price, to acquire. They pirate anything and everything. Bottom line: they will continue to steal technology and copy cat products. Maybe this is why the Japanese do not get along with the Chinese?
Two, the impact of on again, off again trade deals to sales will cause the market to be range bound. This will cause more seasonal employment. The economy will have periods of strength and weakness.
Finally, the benefits of the tax cuts will have a reverse effect on the market. When corporations report their earnings, they will always fall short on year-over-year due to the strong stimulus of the tax act. In addition, many states will increase their gasoline taxes and fees. The consumer will realize the dangers to the economy of on again, off again trade deals. Federal workers will look to unionize and society in general, will see the wisdom of saving for a rainy day. This will reinforce the concept of periods of strength and weakness. The days of a consumer society are ending.
Bottom line: I see a year of consolidation in the stock market with more volume to the downside. Gold will benefit as our record deficits and our ability to repay our debts along with rising costs of healthcare, social security, Medicare and our military will begin to dawn on everyone. The dollar should fall to .92 cents.
As stated above, I developed my conclusions based on the fundamental side of corporate reports. The charts indicate the market is range bound, however there is more strength on the down days than on the up days. Here is a sample of reports.
Warning: Citi Group, Nvidia, Dow Dupont, Apple, Whirlpool, Harley Davidson, ITW, 3M, AK Steel, and Verizon.
Upbeat Guidance: Visa, Royal Caribbean, Oshkosh, Honeywell, Charter, Boeing, Exxon, Chevron, Facebook, Amazon, Master Card, and American Express.
There are a few points within the above companies worth mentioning. Boeing had a $100 billion dollar quarter which is mind blowing. The two oil giants, XOM and CVX posted substantial gains in a quarter where oil lost 30% of its price. In addition, oil service companies had a poor quarter. They say that oil firms are cutting rig count. The reasons are many, but one is the logistics of getting oil or gas to a pipeline for delivery. They are attempting to supply as needed. In the past those ideas never seem to work which means oil price shocks will happen in 2019. Find a cheap oil stock and just wait.
Home sales will continue to struggle unless some new fad like small homes take root. There are three basic needs: food, water and shelter. All three are rising beyond the wages that Americans receive. This is a problem that will overflow into the streets.
Beat Goes On: The cost for a Super Bowl ad for a 30-second commercial rose to $5.25 million. Yowza! However, the beat hit a skip in the record as the US and Russia ended their nuclear treaty. This is not good news for the world and the keepers of the Doomsday Clock.
Many corporations posted good earnings, and yet, they gave poor guidance like Northrop-Grumman. On the flip side some firms had a weak quarter, but gave a strong guidance like Hershey. Keep in mind that some of the earnings of companies that beat expectations was due to previously lowering their guidance. CEOs are trying to manipulate the market to keep their evaluations high. Nothing new here.
The main reason for my conclusions on the market, and thus, the economy is based on three factors. One, the potential trade war between the US and China. Their could be moments of peace, but a leopard cannot hide its spots. There is something within the Chinese culture that allows the people in their culture to make a buck off someone else. By this I mean the Chinese copy products and they use the perception of the buyer when offered a inexpensive price, to acquire. They pirate anything and everything. Bottom line: they will continue to steal technology and copy cat products. Maybe this is why the Japanese do not get along with the Chinese?
Two, the impact of on again, off again trade deals to sales will cause the market to be range bound. This will cause more seasonal employment. The economy will have periods of strength and weakness.
Finally, the benefits of the tax cuts will have a reverse effect on the market. When corporations report their earnings, they will always fall short on year-over-year due to the strong stimulus of the tax act. In addition, many states will increase their gasoline taxes and fees. The consumer will realize the dangers to the economy of on again, off again trade deals. Federal workers will look to unionize and society in general, will see the wisdom of saving for a rainy day. This will reinforce the concept of periods of strength and weakness. The days of a consumer society are ending.
Bottom line: I see a year of consolidation in the stock market with more volume to the downside. Gold will benefit as our record deficits and our ability to repay our debts along with rising costs of healthcare, social security, Medicare and our military will begin to dawn on everyone. The dollar should fall to .92 cents.
As stated above, I developed my conclusions based on the fundamental side of corporate reports. The charts indicate the market is range bound, however there is more strength on the down days than on the up days. Here is a sample of reports.
Warning: Citi Group, Nvidia, Dow Dupont, Apple, Whirlpool, Harley Davidson, ITW, 3M, AK Steel, and Verizon.
Upbeat Guidance: Visa, Royal Caribbean, Oshkosh, Honeywell, Charter, Boeing, Exxon, Chevron, Facebook, Amazon, Master Card, and American Express.
There are a few points within the above companies worth mentioning. Boeing had a $100 billion dollar quarter which is mind blowing. The two oil giants, XOM and CVX posted substantial gains in a quarter where oil lost 30% of its price. In addition, oil service companies had a poor quarter. They say that oil firms are cutting rig count. The reasons are many, but one is the logistics of getting oil or gas to a pipeline for delivery. They are attempting to supply as needed. In the past those ideas never seem to work which means oil price shocks will happen in 2019. Find a cheap oil stock and just wait.
Home sales will continue to struggle unless some new fad like small homes take root. There are three basic needs: food, water and shelter. All three are rising beyond the wages that Americans receive. This is a problem that will overflow into the streets.
Beat Goes On: The cost for a Super Bowl ad for a 30-second commercial rose to $5.25 million. Yowza! However, the beat hit a skip in the record as the US and Russia ended their nuclear treaty. This is not good news for the world and the keepers of the Doomsday Clock.
Wednesday, February 6, 2019
Dangerous Reality
It has been long known that copy cats walk among us. Some try to emulate role models that perform good deeds in society. Sadly, some copy cats perform evil like serial killers. Experience is a great educator and I came across something recently that alarms me.
Before I get into that episode I saw two popular reality TV shows that foster the same ideas as my interaction story.
Survivor and Big Brother:
Are you aware of these two highly rated TV shows? Do you watch them? As a disclaimer I only watched the first season of Survivor and I turned off the TV with Big Brother after five minutes.
With that said, I offer you a new vision or one that you may have already grasped concerning the fundamentals to these shows. It is basically the same principal for both. It is this: competition for a money prize by eliminating contestants in weekly events. Sounds fair, but it isn't.
What happens in these reality shows is sick and dangerous to society as a whole. In Survivor, people are stranded on an island with only the clothes on their back. They must survive the elements and yet, still compete to win by being the last person standing.
In this phony world the physically weak, those with no leadership abilities and or, poor mental capacity ban together to vote off the island anyone who is stronger, smarter and a leader. Anyone who offers their experience, especially older contestants. They are out even before the first vote. They put a target on anyone who wins a competition or demonstrates ability. In the first episode of Survivor, an older man found all the other helpless contestants water. He made fire with his glasses and he reminded those who slept close to the water that high tide is unknown. It would be best to sleep high in a tree. He was correct on all accounts. He was the first voted off the island.
In Big Brother the contestants are confined to a house with no outside contact during the eliminating process. The person who can cook, clean up and help run the house smoothly will always be the first kicked out of the house by the lazy, inept and slower IQs.
Do you see what these TV producers are pushing? All you a low achiever. All those who don't understand how true wealth is accumulated, but has a big mouth. All of you get together and vote out or shutout the competition. Anyone can say free education for all! Free medical or basic income for all! Whatever the issue. It does not matter. What matters is how can you do it so that it is cost effective and self sustaining? That is how you make a difference!
Anyway, back to the real world. I was planning a vacation to Europe. I went online to do price comparisons. I came across the best price offered by Aeroflot. I never heard of that airline. It is a Russian carrier. I'm not prejudiced against the Russians. In fact I always wanted to see their country and meet their people. It won't happen!
After I purchased the ticket, a note flashed on my screen. In order to board the plane from New York with a stopover in Moscow and then, on to Rome, I would have to get a Visa. Dear Reader, this is no fill-out the application on the internet. You need to submit the reason for landing in Moscow and the commissioner will determine either yes or no with a possible fee to this application. Get Real!
There is no way in hell that I will submit to this procedure. It is a barrier placed by paranoid people to shutout the possible goodwill by human contact. This is the small, weak and mentally challenged keeping out the dangers of the sharing of cultures with respect for each other. Now, I do not know if the US imposes the same barriers to Russian tourists. However, since our paranoid military has so much influence in our government, I fear it is like a tit-for-tat game. This is not good for peace.
Recently, the Doomsday Clock was in the news. The time is two minutes to mid-night. People, with these type of actions by government, the time just moved to 1 minute and 59 seconds.
P.S. This might be my last post as Google is closing the door to free speech as they claim not enough interest. Thank you Dear Readers for your loyalty even if you disagreed with me. Hopefully, some day my book will be published, Evolution of Democracy - look for it.
Before I get into that episode I saw two popular reality TV shows that foster the same ideas as my interaction story.
Survivor and Big Brother:
Are you aware of these two highly rated TV shows? Do you watch them? As a disclaimer I only watched the first season of Survivor and I turned off the TV with Big Brother after five minutes.
With that said, I offer you a new vision or one that you may have already grasped concerning the fundamentals to these shows. It is basically the same principal for both. It is this: competition for a money prize by eliminating contestants in weekly events. Sounds fair, but it isn't.
What happens in these reality shows is sick and dangerous to society as a whole. In Survivor, people are stranded on an island with only the clothes on their back. They must survive the elements and yet, still compete to win by being the last person standing.
In this phony world the physically weak, those with no leadership abilities and or, poor mental capacity ban together to vote off the island anyone who is stronger, smarter and a leader. Anyone who offers their experience, especially older contestants. They are out even before the first vote. They put a target on anyone who wins a competition or demonstrates ability. In the first episode of Survivor, an older man found all the other helpless contestants water. He made fire with his glasses and he reminded those who slept close to the water that high tide is unknown. It would be best to sleep high in a tree. He was correct on all accounts. He was the first voted off the island.
In Big Brother the contestants are confined to a house with no outside contact during the eliminating process. The person who can cook, clean up and help run the house smoothly will always be the first kicked out of the house by the lazy, inept and slower IQs.
Do you see what these TV producers are pushing? All you a low achiever. All those who don't understand how true wealth is accumulated, but has a big mouth. All of you get together and vote out or shutout the competition. Anyone can say free education for all! Free medical or basic income for all! Whatever the issue. It does not matter. What matters is how can you do it so that it is cost effective and self sustaining? That is how you make a difference!
Anyway, back to the real world. I was planning a vacation to Europe. I went online to do price comparisons. I came across the best price offered by Aeroflot. I never heard of that airline. It is a Russian carrier. I'm not prejudiced against the Russians. In fact I always wanted to see their country and meet their people. It won't happen!
After I purchased the ticket, a note flashed on my screen. In order to board the plane from New York with a stopover in Moscow and then, on to Rome, I would have to get a Visa. Dear Reader, this is no fill-out the application on the internet. You need to submit the reason for landing in Moscow and the commissioner will determine either yes or no with a possible fee to this application. Get Real!
There is no way in hell that I will submit to this procedure. It is a barrier placed by paranoid people to shutout the possible goodwill by human contact. This is the small, weak and mentally challenged keeping out the dangers of the sharing of cultures with respect for each other. Now, I do not know if the US imposes the same barriers to Russian tourists. However, since our paranoid military has so much influence in our government, I fear it is like a tit-for-tat game. This is not good for peace.
Recently, the Doomsday Clock was in the news. The time is two minutes to mid-night. People, with these type of actions by government, the time just moved to 1 minute and 59 seconds.
P.S. This might be my last post as Google is closing the door to free speech as they claim not enough interest. Thank you Dear Readers for your loyalty even if you disagreed with me. Hopefully, some day my book will be published, Evolution of Democracy - look for it.
Wednesday, January 30, 2019
Facts: Fiat Has Failed and Fed Will Stall
I begin by reminding you of the rules and regulations concerning unemployment. To register to collect unemployment benefits, a worker must have at minimum 26 consecutive weeks of work. The past few weeks 700,000 retail workers were let go, pink slip, adios amigo! They will not be counted in the weekly report. They are seasonal, Christmas help. The point shows many aspects of our economy. The BLS says unemployment claims hit a fifty year low last week, but this fact shows there are many people out there willing to work. They are just tired of part-time employment. This is only retail. How many other work fields utilize seasonal help. There are many, especially agriculture. We have a lot of unemployed people, but they are not counted because they do not fall into the Department of Labor rules and regulations.
Money Facts
How about the saga of the furloughed government workers? I bring them up because federal workers are at middle class level. All their whining and crying due to the loss of one or two paychecks and they cannot afford to live. It is a reflection of the American mentality. They cannot control spending. They do not save for a rainy day. They do not know how to manage money. Very sad, indeed. Keep in mind that they represent the middle class. What about low wage earners like the 700,000 laid of seasonal help? There are many culprits as to why our basic citizen cannot make ends meet. Look at our so-called leadership! The government has run deficits since Bill Clinton was in office. Before that, you have to go to the Kennedy administration. The problem is the government just prints more money and you and I do not have that privilege. This is not a piece that will direct you to a money guru for advice, but look at our currency itself. It is the chief reason why as a society we are losing the middle class, the American Dream and our way of life. Simple: It is fiat money.
.65 cents an hour
Yes. That figure was the minimum wage at one time. Funny thing, people got buy because our way of life was much stronger. A gallon of gas was .30 cents or less. A teenager could find summer employment and the money he SAVED was enough to cover a local college come the Fall. However, our immoral government leaders kept spending like for the military and every year that they spent more than revenues, our dollar became less in value. In fact, since the Federal Reserve started in 1913, our dollar has lost 95% of its value. That is what fiat money does to a society. Here is another fact. There has never been a government who has succeeded using fiat currency. They all end in collapse. Hey, federal workers, did you read that? Understand it? This period of work without pay will happen again and again. Start saving for those rainy days.
Anyway, the Federal Reserve has its motives in greed. This greed leads to wealth which leads to power. This is why this group of unelected private bankers are for the banking industry. Congress violated the constitution by giving away its right to manage our currency and that currency should be backed by gold. Gold keeps government from running deficits. It also protects our standard of living. Our currency no longer has this solid foundation. It is just military strength behind the economy. The cost of fiat money has to get cheaper and cheaper because the debt it has created is larger and larger.
Some Aspects
Our national deficit keeps growing. Let me show you the recent trend. It is alarming! In 2009 the US debt was 60% of GDP. In ten years that deficit has grown another 40% to 104% of everything of value that is produced in our country. Could you live by spending and owing 104% of your income?
Of course, not. This point reflects the true danger of fiat money. It is easy to print, but difficult to pay. This is why the Fed cannot raise interest rates beyond 3.5% because our nation could not service the debt without raising taxes. If you want a poster child for a government that taxes everything, look at France. The French impose a 45% tax rate and tax anything and everything in society and still, the government is in debt with no money for stimulus projects.
How about the consumer? If you combine credit cards, auto loans, and student debt, it is now up 25% in the last five years to $4 trillion. The price of products, shelter and healthcare rise faster and higher than our wages. We always need more money because the value of our currency keeps declining. In many locations people need to use 50% of their income for rent. There is no discretionary money left on the table. A recent report reveals that 42% of Americans have no savings for retirement. The list is as long as the immigration line. The money tree that once was America is barren of green leaves.
A related point to this is student loans are defaulting at higher rate than mortgage defaults in 2007 and more than all junk mortgages in 2007.
How about corporate leadership? I should say, so-called leadership. Corporate debt is $9 trillion and rising. Within those borrowings is iconic brand names like GE, IBM and AT&T. Their rated bonds are BBB and falling. The biggest evil here is derivatives. Collateral debt obligations in 2007 was $61 trillion. They are now over $120 trillion. Fiat money numbers grow exponentially and the reality will dawn on the market place that they will not be repaid. This also means a day of reckoning and possible collapse of our currency which will lead to a collapse of our economy and depression.
By the way, China is even worse than us. Their debt in 2000 was $2 trillion. Today, it is up 2000% to $40 trillion or off the charts!
Fiat money is a failure and the Fed cannot raise rates. Fiat money can only continue this game by getting cheaper even negative. When the music of manipulation stops, you better have some gold under the last seat. End the Fed!
Money Facts
How about the saga of the furloughed government workers? I bring them up because federal workers are at middle class level. All their whining and crying due to the loss of one or two paychecks and they cannot afford to live. It is a reflection of the American mentality. They cannot control spending. They do not save for a rainy day. They do not know how to manage money. Very sad, indeed. Keep in mind that they represent the middle class. What about low wage earners like the 700,000 laid of seasonal help? There are many culprits as to why our basic citizen cannot make ends meet. Look at our so-called leadership! The government has run deficits since Bill Clinton was in office. Before that, you have to go to the Kennedy administration. The problem is the government just prints more money and you and I do not have that privilege. This is not a piece that will direct you to a money guru for advice, but look at our currency itself. It is the chief reason why as a society we are losing the middle class, the American Dream and our way of life. Simple: It is fiat money.
.65 cents an hour
Yes. That figure was the minimum wage at one time. Funny thing, people got buy because our way of life was much stronger. A gallon of gas was .30 cents or less. A teenager could find summer employment and the money he SAVED was enough to cover a local college come the Fall. However, our immoral government leaders kept spending like for the military and every year that they spent more than revenues, our dollar became less in value. In fact, since the Federal Reserve started in 1913, our dollar has lost 95% of its value. That is what fiat money does to a society. Here is another fact. There has never been a government who has succeeded using fiat currency. They all end in collapse. Hey, federal workers, did you read that? Understand it? This period of work without pay will happen again and again. Start saving for those rainy days.
Anyway, the Federal Reserve has its motives in greed. This greed leads to wealth which leads to power. This is why this group of unelected private bankers are for the banking industry. Congress violated the constitution by giving away its right to manage our currency and that currency should be backed by gold. Gold keeps government from running deficits. It also protects our standard of living. Our currency no longer has this solid foundation. It is just military strength behind the economy. The cost of fiat money has to get cheaper and cheaper because the debt it has created is larger and larger.
Some Aspects
Our national deficit keeps growing. Let me show you the recent trend. It is alarming! In 2009 the US debt was 60% of GDP. In ten years that deficit has grown another 40% to 104% of everything of value that is produced in our country. Could you live by spending and owing 104% of your income?
Of course, not. This point reflects the true danger of fiat money. It is easy to print, but difficult to pay. This is why the Fed cannot raise interest rates beyond 3.5% because our nation could not service the debt without raising taxes. If you want a poster child for a government that taxes everything, look at France. The French impose a 45% tax rate and tax anything and everything in society and still, the government is in debt with no money for stimulus projects.
How about the consumer? If you combine credit cards, auto loans, and student debt, it is now up 25% in the last five years to $4 trillion. The price of products, shelter and healthcare rise faster and higher than our wages. We always need more money because the value of our currency keeps declining. In many locations people need to use 50% of their income for rent. There is no discretionary money left on the table. A recent report reveals that 42% of Americans have no savings for retirement. The list is as long as the immigration line. The money tree that once was America is barren of green leaves.
A related point to this is student loans are defaulting at higher rate than mortgage defaults in 2007 and more than all junk mortgages in 2007.
How about corporate leadership? I should say, so-called leadership. Corporate debt is $9 trillion and rising. Within those borrowings is iconic brand names like GE, IBM and AT&T. Their rated bonds are BBB and falling. The biggest evil here is derivatives. Collateral debt obligations in 2007 was $61 trillion. They are now over $120 trillion. Fiat money numbers grow exponentially and the reality will dawn on the market place that they will not be repaid. This also means a day of reckoning and possible collapse of our currency which will lead to a collapse of our economy and depression.
By the way, China is even worse than us. Their debt in 2000 was $2 trillion. Today, it is up 2000% to $40 trillion or off the charts!
Fiat money is a failure and the Fed cannot raise rates. Fiat money can only continue this game by getting cheaper even negative. When the music of manipulation stops, you better have some gold under the last seat. End the Fed!
Wednesday, January 23, 2019
Odds and Ends: January 2019
The stock market has rebounded, but it has reached the 50% Fibonacci retracement level. This is the point where everyone at Evolution of Democracy sees as a consolidation point. The tell sign has been the trading volume, which has declined with each increment upward. The market will be continually effected by news, especially dealing with the trade tensions with China and the UK Brexit in Europe. With that said, the quarterly earnings reports have begun. The banks were first up and the overall results have been to the upside.
Firm Results Outlook
*Citi Group> posted better than expected, but cost cuts were the reason. Fed dependent
*J.P. Morgan>had earnings miss, but better trading improved bottom line. upbeat
*Wells Fargo>also missed, but the buyback of shares improved bottom line. Court costs are up.
*B of A> beat on earnings and revenue. upbeat
*Goldman Sachs> solid earnings, but still has Malaysian issue. upbeat
*Morgan Stanley>profit fell below expectations. Fed dependent
Note: the 6 biggest banks pulled in $100 billion in profits in 2018.
Large Regionals
*US Bank> profit up big(10%). upbeat
*BB&T> solid quarter. upbeat
*American Express>record quarter lowered expectation
*Capital One>missed numbers Fed dependent
I will add this very important point that was reported recently. World debt is $340 trillion which is more than 3x the total of the world's GDP. Look at this another way. According to bank lending standards to qualify for a home loan mortgage, the world could not meet the standards for a home loan. We are floating on debt like the pollution floating around in a circle in the Pacific Ocean. This is not healthy and very dangerous.
Housing
Treasury secretary, Steven Mnuchin stated that he has President Trump's blessing to work out a plan to make the government mortgage companies, Fannie Mae and Freddie Mac, private concerns. I don't see it happening.
The housing market itself has shown declines in sales for 5 straight months, but looking closer reveals a more serious problem. The percentage declines for the last three months is very scary. They are -16%, -19% and -18%.
In a related report, it is noted that severe weather could cause the next housing crisis. The report uses the latest causalities in Houston and locations in California that suffered with wildfires. Houston is a strong market with a strong economy and still it suffered many foreclosures. It is too soon to evaluate California, but there point is valid. Your neighborhood could become a ghost village due to weather and calamities.
In still another related story the on-going drama around PG&E, the very large California utility. Reports are surfacing pointing to the utility for causing a few of the wildfires within the state. The stock has plunged. It is getting worse. Shareholders could be wiped out as the utility says that it will seek bankruptcy protection. Funny, your business is dying You are facing bankruptcy and that is your salvation? Only in America. Anyway, the market cap is $3.8B and the bond holders have $30 billion in notes, but the future liabilities are estimated at $40 billion. Now, there are many institutions holding these bonds and I'm sure some have protection like with derivatives. Can you see where this is going? This will cause a domino of losses and this story is just beginning. Yowza!
Auto
Ford will build an electric F-truck series model with more power than its current gas version.
Goodyear missed on earnings and declining sales continues a negative trend.
Tesla will cut workers as well as GM, but European firms are expanding in the US. I should say the South which is anti union. My southern buddies will regret that point some day.
I give credit and a shout out to Jeep which is expanding and in the Motor City. Good for them!
OIL
OPEC reported its largest monthly drop in exports. They are going to the playbook of supply and demand. They have succeeded in getting the price of oil up. Eventually, this will hit the US consumer in higher gasoline prices. At the moment, I see a consolidation of gains with Iran being a very important cog in the future price of the commodity.
To me, the above are the most important aspects to our economy and global concerns. The January barometer looks good, but the legacy behind it was wrong for 2018. I prefer the Super Bowl theory.
By the way, Happy Birthday to JFL!
Firm Results Outlook
*Citi Group> posted better than expected, but cost cuts were the reason. Fed dependent
*J.P. Morgan>had earnings miss, but better trading improved bottom line. upbeat
*Wells Fargo>also missed, but the buyback of shares improved bottom line. Court costs are up.
*B of A> beat on earnings and revenue. upbeat
*Goldman Sachs> solid earnings, but still has Malaysian issue. upbeat
*Morgan Stanley>profit fell below expectations. Fed dependent
Note: the 6 biggest banks pulled in $100 billion in profits in 2018.
Large Regionals
*US Bank> profit up big(10%). upbeat
*BB&T> solid quarter. upbeat
*American Express>record quarter lowered expectation
*Capital One>missed numbers Fed dependent
I will add this very important point that was reported recently. World debt is $340 trillion which is more than 3x the total of the world's GDP. Look at this another way. According to bank lending standards to qualify for a home loan mortgage, the world could not meet the standards for a home loan. We are floating on debt like the pollution floating around in a circle in the Pacific Ocean. This is not healthy and very dangerous.
Housing
Treasury secretary, Steven Mnuchin stated that he has President Trump's blessing to work out a plan to make the government mortgage companies, Fannie Mae and Freddie Mac, private concerns. I don't see it happening.
The housing market itself has shown declines in sales for 5 straight months, but looking closer reveals a more serious problem. The percentage declines for the last three months is very scary. They are -16%, -19% and -18%.
In a related report, it is noted that severe weather could cause the next housing crisis. The report uses the latest causalities in Houston and locations in California that suffered with wildfires. Houston is a strong market with a strong economy and still it suffered many foreclosures. It is too soon to evaluate California, but there point is valid. Your neighborhood could become a ghost village due to weather and calamities.
In still another related story the on-going drama around PG&E, the very large California utility. Reports are surfacing pointing to the utility for causing a few of the wildfires within the state. The stock has plunged. It is getting worse. Shareholders could be wiped out as the utility says that it will seek bankruptcy protection. Funny, your business is dying You are facing bankruptcy and that is your salvation? Only in America. Anyway, the market cap is $3.8B and the bond holders have $30 billion in notes, but the future liabilities are estimated at $40 billion. Now, there are many institutions holding these bonds and I'm sure some have protection like with derivatives. Can you see where this is going? This will cause a domino of losses and this story is just beginning. Yowza!
Auto
Ford will build an electric F-truck series model with more power than its current gas version.
Goodyear missed on earnings and declining sales continues a negative trend.
Tesla will cut workers as well as GM, but European firms are expanding in the US. I should say the South which is anti union. My southern buddies will regret that point some day.
I give credit and a shout out to Jeep which is expanding and in the Motor City. Good for them!
OIL
OPEC reported its largest monthly drop in exports. They are going to the playbook of supply and demand. They have succeeded in getting the price of oil up. Eventually, this will hit the US consumer in higher gasoline prices. At the moment, I see a consolidation of gains with Iran being a very important cog in the future price of the commodity.
To me, the above are the most important aspects to our economy and global concerns. The January barometer looks good, but the legacy behind it was wrong for 2018. I prefer the Super Bowl theory.
By the way, Happy Birthday to JFL!
Wednesday, January 16, 2019
Retail Gloom
The shills were out in the media just before Halloween. They were barking up retail stocks. The spiel stated that with a strong economy and low unemployment, holiday sales in retail would soar. They threw out stats and charts with some claiming a 10% rise from the previous year.
Then, came Black Friday after Thanksgiving. Foot traffic was strong, but shoppers were comparing prices to online deals. Some stores posted higher sales from a year ago, however the real season was still to come. When that weekend ended, we had...
Cyber Monday
It set a record. Reports showed that for the first time, e-commerce(103m) surpassed retail outlets(102m). The writing was on the subway walls. As noted by Sebastian, shoppers can always save on taxes by purchasing online. This is an unfair advantage over retail. Congress gave the internet a chance to grow, but it is time for it to stand on its own merits.
In addition, many retail outlets are providing extra savings on products from their own online service. This is like shooting your own foot. Nevertheless, the old saying holds, "If you can't beat them, join them."
Bottom line: Holiday sales were up 6.7% to over $715 billion. This is up 3.7% from 2017.
From any perspective the costumed barkers in October appeared to be correct in their call, but their mask cannot hide the truth.
Although total sales were up for the season, most of the gains fell to online activity. Internet sales in 2017 was $106 billion. This year they rose over $122 billion. This is what makes up the sales increase for 2018. Sadly, retail sales fell 6.7% in the week before Christmas. Foot traffic was worse. It fell 10.4% and with good weather in most of the nation.
The following stock price comparisons from prior to the holiday season and into today, reveals sales results as reflected in the valuation of the company. Please note, this is only a sample.
Firm/symbol Date of stock price Todays price
*Walmart(WMT) $105 in November $94.
*Macy's(M) $38 in November $25.
*Target(TGT) $87 in October $69.
*Kohl's(KSS) $82 in November $67.
*Bed, Bath, Beyond(BBBY) $19 in October(Note large gap, too) $15
*Best Buy(BBY) $80 in September $56.
Amazon(AMZN) $2,050 in September >had a low at $1310, now $1640.
In addition to the price action in Amazon, it is reported that they claim 55% of all online sales. This is not good for the industry as a whole.
As you can readily see the price action for all retail companies is downward. Not good. Bad news likes company and we have many retail firms announcing store closings. Leading the infamous group is Sears. The firm is in bankruptcy court. It does not look good for this iconic firm. J.C. Penny's is right behind Sears. Also giving pink slips is Chico's and Game Stop.
Then, there is warning announcements from Apple, FedEx, Samsung, and Barnes and Noble. An analyst just downgraded the Gap. With each passing day more negative news hits the airwaves. Not good. Then, least I forget, the government shutdown.
Gov't Shutdown
This effects so many aspects to our society that it makes one realize how much socialism constitutes a high percentage in our so-called free enterprise, capitalist system.
We have over 800,000 federal employees without a paycheck. This won't help retail or the economy.
Food stamps is now called SNAP and it distributes to 12% of the population who are now, hungry.
Some home loans will not be able to close. Small Business will not assist small business. How about auto loans? FAA to certify new airplanes? Contractors with ties to government projects? After you read this, other agencies will come to mind. Not good for the economy and not good to have so much of the economy attributed to government. President Trump has ordered all government workers back to work during this shutdown period. This will push gov't workers to form a union and even if that effort fails, serious backlash will rise up at some point.
Global
In Europe, Germany is warning of a slower GDP for the quarter. If the leader is weak, the chain cannot be too strong. Keep in mind that the "yellow vest" protest in France is entering its 9th week with no end in sight. What started out as a protest to losing a fuel subsidy is now being directed at the French president. This action has hurt the GPD of the EU.
In the UK their government rejected Prime Minister May's Brexit plan. She will turn to the EU, but they will definitely not help her cause. It appears that Sebastian's prediction to doing nothing is correct. It also means like I said that the powers-to-be will let you vote, but never fulfill any chance that they do not accept. Democracy in name, but oligarchy in nature.
In China, many agencies have warned with many citing the tension with the US over trade. By the way, all those possible tariffs taxes won't be good for the price of retail products or the US consumer, although I am for tariffs to protect American industry. It appears that the trade talks have not reached any new developments.
New Problem
Returns! People return items and some cash in gift cards. The problem is growing for retail with storage of returned items. In the past most of it went to auctions, but even that outlet is at capacity. Keep in mind what was once considered a sale, is now no longer a sale. It is a loss under liabilities. Not good.
All in all Sebastian's call is looking good for a dangerous period in the US economy beginning around the Ides of March.
Then, came Black Friday after Thanksgiving. Foot traffic was strong, but shoppers were comparing prices to online deals. Some stores posted higher sales from a year ago, however the real season was still to come. When that weekend ended, we had...
Cyber Monday
It set a record. Reports showed that for the first time, e-commerce(103m) surpassed retail outlets(102m). The writing was on the subway walls. As noted by Sebastian, shoppers can always save on taxes by purchasing online. This is an unfair advantage over retail. Congress gave the internet a chance to grow, but it is time for it to stand on its own merits.
In addition, many retail outlets are providing extra savings on products from their own online service. This is like shooting your own foot. Nevertheless, the old saying holds, "If you can't beat them, join them."
Bottom line: Holiday sales were up 6.7% to over $715 billion. This is up 3.7% from 2017.
From any perspective the costumed barkers in October appeared to be correct in their call, but their mask cannot hide the truth.
Although total sales were up for the season, most of the gains fell to online activity. Internet sales in 2017 was $106 billion. This year they rose over $122 billion. This is what makes up the sales increase for 2018. Sadly, retail sales fell 6.7% in the week before Christmas. Foot traffic was worse. It fell 10.4% and with good weather in most of the nation.
The following stock price comparisons from prior to the holiday season and into today, reveals sales results as reflected in the valuation of the company. Please note, this is only a sample.
Firm/symbol Date of stock price Todays price
*Walmart(WMT) $105 in November $94.
*Macy's(M) $38 in November $25.
*Target(TGT) $87 in October $69.
*Kohl's(KSS) $82 in November $67.
*Bed, Bath, Beyond(BBBY) $19 in October(Note large gap, too) $15
*Best Buy(BBY) $80 in September $56.
Amazon(AMZN) $2,050 in September >had a low at $1310, now $1640.
In addition to the price action in Amazon, it is reported that they claim 55% of all online sales. This is not good for the industry as a whole.
As you can readily see the price action for all retail companies is downward. Not good. Bad news likes company and we have many retail firms announcing store closings. Leading the infamous group is Sears. The firm is in bankruptcy court. It does not look good for this iconic firm. J.C. Penny's is right behind Sears. Also giving pink slips is Chico's and Game Stop.
Then, there is warning announcements from Apple, FedEx, Samsung, and Barnes and Noble. An analyst just downgraded the Gap. With each passing day more negative news hits the airwaves. Not good. Then, least I forget, the government shutdown.
Gov't Shutdown
This effects so many aspects to our society that it makes one realize how much socialism constitutes a high percentage in our so-called free enterprise, capitalist system.
We have over 800,000 federal employees without a paycheck. This won't help retail or the economy.
Food stamps is now called SNAP and it distributes to 12% of the population who are now, hungry.
Some home loans will not be able to close. Small Business will not assist small business. How about auto loans? FAA to certify new airplanes? Contractors with ties to government projects? After you read this, other agencies will come to mind. Not good for the economy and not good to have so much of the economy attributed to government. President Trump has ordered all government workers back to work during this shutdown period. This will push gov't workers to form a union and even if that effort fails, serious backlash will rise up at some point.
Global
In Europe, Germany is warning of a slower GDP for the quarter. If the leader is weak, the chain cannot be too strong. Keep in mind that the "yellow vest" protest in France is entering its 9th week with no end in sight. What started out as a protest to losing a fuel subsidy is now being directed at the French president. This action has hurt the GPD of the EU.
In the UK their government rejected Prime Minister May's Brexit plan. She will turn to the EU, but they will definitely not help her cause. It appears that Sebastian's prediction to doing nothing is correct. It also means like I said that the powers-to-be will let you vote, but never fulfill any chance that they do not accept. Democracy in name, but oligarchy in nature.
In China, many agencies have warned with many citing the tension with the US over trade. By the way, all those possible tariffs taxes won't be good for the price of retail products or the US consumer, although I am for tariffs to protect American industry. It appears that the trade talks have not reached any new developments.
New Problem
Returns! People return items and some cash in gift cards. The problem is growing for retail with storage of returned items. In the past most of it went to auctions, but even that outlet is at capacity. Keep in mind what was once considered a sale, is now no longer a sale. It is a loss under liabilities. Not good.
All in all Sebastian's call is looking good for a dangerous period in the US economy beginning around the Ides of March.
Wednesday, January 9, 2019
Forecast: 2019
Milton Friedman claimed that a government will revert to the norm six months after a newly elected president. They will oppose his policies if they are counter to the status quo interests. I guess Milton never met Donald Trump. President Trump has fired staff and shown antagonism for opposing parties who do not accept his views. The focal point on domestic policy is the Border Wall. The issue on trade effects global trading.
President Trump has displayed to opposing parties by shutting down the government, his determination and resolution. This is important because it tells the Chinese that he is serious and he is in it for the long haul. On the latter I hope he is sincere. Personally, I would ban trade with China because they have demonstrated ill will. They force exporting companies to reveal all their data on their products. Then, they steal ideas to develop competing products. They disrespect patents and "clone" products. They substitute cheaper ingredients in licensing agreements. They place high tariffs on items that they cannot manufacture to close off competition. All of the above and more is why the leadership of China is nothing more than thugs in international dealings.
Bottom line: The two focal points listed above will determine the outlook for 2019. With that said the market will be range bound until March. If a new trade deal is made with China, the market will get a relief rally and then, look to fundamentals. The fundamentals at this point remain strong and contrary to Sebastian, I see an up year in the economy, but I agree with him, dark clouds are forming.
First Dark Cloud:
The Fed. No one will say it because the truth will destroy the economy. The truth is that fiat money is a complete failure. The Federal Reserve could never raise interest rates close to what was once normal. Just the thought of rates approaching 3.75% sends the market down on an express elevator. All of our governments - local, state and national are suffering from debt due to easy money. The unspoken realization scares the hell out of all elected leaders. Our national debt grows at twice the level as does our economy. If we had normal interest rates our national debt would double and the global community would seek a new reserve currency. If that ever happens, our economy would implode. The hated, barbaric relic of gold kept government in check as well as the banking industry and the military. Those two joined forces for self interest to get us off the gold standard. The accumulated wealth of our great nation took a long time to use up, but it is almost empty. The killing of the middle class is the reflection of the empty vault of the nation's wealth.
Internal conflict: Jay Powell could be fired. The market will be fearful of this happening. He has already come out saying that the Fed has no preset formula to raise rates. Two months ago, he said that there would be three hikes in 2019. Then, he revised that call down to two increases. Now, he says maybe just one. He will pause for his job. Two other governors of the reserve, Kaplan and Williams stated that it is best to pause or even cut the rate. This, dear reader is further proof of the failure of fiat money. The economy is suppose to be fully recovered and even with low interest rates, it cannot get out of its own way.
Housing and other clouds
This is the most important aspect within our economy. Single family home sales are down, but multifamily housing continues to grow. This trend will continue. More and more citizens will become economic prisoners to rentals. Housing prices will return to normal growth rates of 2% to 3%. Rents will rise. In some cities rents consume 50% of tenants income. This is not sustainable for an economy. You saw the riots in France when fuel subsidies was eliminated. We will have the same type of backlash here in the US over renting and housing costs. Also, note, James Stack who called the housing recession of 2008, is on record as seeing the same bubble bursting again in housing.
Autos
Sales of autos reached 17.2 million for 2018. This is a record because the industry eclipsed 17m for four straight years. The Japanese are worried by the number four. I do not see a fifth year of over 17m sales. The market will slow, however the impact of electric vehicles will begin to have an effect. The oil industry will not see a growth year due to the emergence of electric cars. A quick thinking politician will try to get a name for himself by calling for recharging stations on interstate highways.
Banks
The shills will say that the industry will grow by double digits. They do every year. They point to the aspect that banks make money even in this low interest rate level. Banking will face the growing competition of internet banking and I see them offering similar perks to stem this competition. They have the Fed backing them up. They will maintain their status and power.
International banks are not as strong as US banks, however they are connected in this interconnected world. Derivatives could cause a global liquidity crisis to which no bank is safe. This fear only gets worse with time.
Healthcare
This is a growing field due to demographics. The concern will be Obamacare and health insurance. President Trump may make a deal with the Democrats on passing the new NAFTA deal and the Border Wall and allow Obamacare to continue. In any event prices will rise for medicine and insurance and yet, this inflationary aspect will never enter into the lingo of the Fed.
Energy
Oil prices will continue to drift lower until the end of January. If you recall, Sebastian informed you of this price action as he said to find a low price oil firm and get some shares before the OPEC oil cuts begin to raise the price of oil. I see oil returning to $60 by April. As stated above, the growth in electric vehicles will put a cap on oil prices.
Utilities
The industry is changing. More and more utility companies are dropping coal. Nuclear lobbyist are always in the mix, but everyone on this blog is against nuclear energy. The impact of solar and wind is growing and they will continue to grow. Stocks in this segment will be appealing as the Fed pauses their interest rate hikes.
Airlines
The industry will get more fliers and the firms that have forward looking fuel contracts will do the best. This could be the last good year for awhile for the industry.
Consumer Staples - Retail
They remain constant with steady growth due to population growth. The problems will be in distribution. Many retail locations will close as more malls and shopping centers fall into bankruptcy. The continued growth in ecommerce will stall as taxation of internet sales becomes law of the land. The general population will realize the importance of their local shopping centers. Amazon will see their growth rate slow.
All in all the stock market should find its footing and I believe it will have a good year even though volatile for a period of time. This will be the last year of the bull market as 2020 will be a major transitioning year for the US and our economy.
President Trump has displayed to opposing parties by shutting down the government, his determination and resolution. This is important because it tells the Chinese that he is serious and he is in it for the long haul. On the latter I hope he is sincere. Personally, I would ban trade with China because they have demonstrated ill will. They force exporting companies to reveal all their data on their products. Then, they steal ideas to develop competing products. They disrespect patents and "clone" products. They substitute cheaper ingredients in licensing agreements. They place high tariffs on items that they cannot manufacture to close off competition. All of the above and more is why the leadership of China is nothing more than thugs in international dealings.
Bottom line: The two focal points listed above will determine the outlook for 2019. With that said the market will be range bound until March. If a new trade deal is made with China, the market will get a relief rally and then, look to fundamentals. The fundamentals at this point remain strong and contrary to Sebastian, I see an up year in the economy, but I agree with him, dark clouds are forming.
First Dark Cloud:
The Fed. No one will say it because the truth will destroy the economy. The truth is that fiat money is a complete failure. The Federal Reserve could never raise interest rates close to what was once normal. Just the thought of rates approaching 3.75% sends the market down on an express elevator. All of our governments - local, state and national are suffering from debt due to easy money. The unspoken realization scares the hell out of all elected leaders. Our national debt grows at twice the level as does our economy. If we had normal interest rates our national debt would double and the global community would seek a new reserve currency. If that ever happens, our economy would implode. The hated, barbaric relic of gold kept government in check as well as the banking industry and the military. Those two joined forces for self interest to get us off the gold standard. The accumulated wealth of our great nation took a long time to use up, but it is almost empty. The killing of the middle class is the reflection of the empty vault of the nation's wealth.
Internal conflict: Jay Powell could be fired. The market will be fearful of this happening. He has already come out saying that the Fed has no preset formula to raise rates. Two months ago, he said that there would be three hikes in 2019. Then, he revised that call down to two increases. Now, he says maybe just one. He will pause for his job. Two other governors of the reserve, Kaplan and Williams stated that it is best to pause or even cut the rate. This, dear reader is further proof of the failure of fiat money. The economy is suppose to be fully recovered and even with low interest rates, it cannot get out of its own way.
Housing and other clouds
This is the most important aspect within our economy. Single family home sales are down, but multifamily housing continues to grow. This trend will continue. More and more citizens will become economic prisoners to rentals. Housing prices will return to normal growth rates of 2% to 3%. Rents will rise. In some cities rents consume 50% of tenants income. This is not sustainable for an economy. You saw the riots in France when fuel subsidies was eliminated. We will have the same type of backlash here in the US over renting and housing costs. Also, note, James Stack who called the housing recession of 2008, is on record as seeing the same bubble bursting again in housing.
Autos
Sales of autos reached 17.2 million for 2018. This is a record because the industry eclipsed 17m for four straight years. The Japanese are worried by the number four. I do not see a fifth year of over 17m sales. The market will slow, however the impact of electric vehicles will begin to have an effect. The oil industry will not see a growth year due to the emergence of electric cars. A quick thinking politician will try to get a name for himself by calling for recharging stations on interstate highways.
Banks
The shills will say that the industry will grow by double digits. They do every year. They point to the aspect that banks make money even in this low interest rate level. Banking will face the growing competition of internet banking and I see them offering similar perks to stem this competition. They have the Fed backing them up. They will maintain their status and power.
International banks are not as strong as US banks, however they are connected in this interconnected world. Derivatives could cause a global liquidity crisis to which no bank is safe. This fear only gets worse with time.
Healthcare
This is a growing field due to demographics. The concern will be Obamacare and health insurance. President Trump may make a deal with the Democrats on passing the new NAFTA deal and the Border Wall and allow Obamacare to continue. In any event prices will rise for medicine and insurance and yet, this inflationary aspect will never enter into the lingo of the Fed.
Energy
Oil prices will continue to drift lower until the end of January. If you recall, Sebastian informed you of this price action as he said to find a low price oil firm and get some shares before the OPEC oil cuts begin to raise the price of oil. I see oil returning to $60 by April. As stated above, the growth in electric vehicles will put a cap on oil prices.
Utilities
The industry is changing. More and more utility companies are dropping coal. Nuclear lobbyist are always in the mix, but everyone on this blog is against nuclear energy. The impact of solar and wind is growing and they will continue to grow. Stocks in this segment will be appealing as the Fed pauses their interest rate hikes.
Airlines
The industry will get more fliers and the firms that have forward looking fuel contracts will do the best. This could be the last good year for awhile for the industry.
Consumer Staples - Retail
They remain constant with steady growth due to population growth. The problems will be in distribution. Many retail locations will close as more malls and shopping centers fall into bankruptcy. The continued growth in ecommerce will stall as taxation of internet sales becomes law of the land. The general population will realize the importance of their local shopping centers. Amazon will see their growth rate slow.
All in all the stock market should find its footing and I believe it will have a good year even though volatile for a period of time. This will be the last year of the bull market as 2020 will be a major transitioning year for the US and our economy.
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