- Education is simply the soul of a society as it passes from one generation to another.
- G.K. Chesterton
Legacy
One good thing about society is books keep knowledge and experience for all to grow. The flipside is all the wrong people are doing the reading to gain advantage. In the stock market we are fortunate that the Japanese people have passed along the tool of candlestick charting. We use it everyday. Since the market has been in a correction mode, the question about a bear market surfaces.
Ground Hog...
...was right. We are getting six more weeks of winter, but the weather does change as well as everything else. The previous bullish energy in the market is waning. The market is still around its highs, but with less conviction as seen with volume. There are more down days which is a sign of change. It bears watching (did you like the pun?). The up and down breadth is turning down even though as mentioned, the market remains around the highs. Finally, under "Dow Theory" the indexes are not in harmony which is an indicator of change. The three indicate that a possible bear market is coming, but there is no conviction at the moment. There are many gaps that are being filled. We advise caution for now.
Economy
With all the news about tariffs, we did some digging as in metals. What we find is the truth. It is hardly heard in America. Trump is correct to place tariffs to bring manufacturing back. However, we disagree with his approach. It is only tokenism. It will only add to inflation and not achieve the target - US production.
A nation needs to be self-sufficient or as close to that goal as possible. Hats off to Japan and Germany who have little resources, but they are still a force in manufacturing. This helps their economy and standard of living. Both of those nations have a bretter standard of living than the US. Think about that?! We have natural resources, a population greater than the combined totals of those two nations, a much larger land space then the two combined and yet, we do not come close to them in manufacturing, standard of living and education. This is not only sad, but mind boggeling. Here is some facts that pertain to real strength in an economy.
Top 10 in Aluminium (tariff news)
Number one is China. India is next and then, Russia. Number 10 is Malaysia. Among the list is Norway, Canada and the United Arab Emerite as well as Bahrain. BAHRAIN!!! It has a popuation of 1.47 million. Brooklyn, New York has more people. The US is not in the top 10. This is why we are declining with homelessness and loss of hope. These are high paying jobs that makes a middle class. It gives social mobility. It develops hope. The Democrats and Republicans are both guilty. This is why we need unions and repeal the Taft-Hartley Act.
Top 10 Steelmakers
Quess who is number one? That's right, China. All the BS about the US being the top economy is just that, BS! The rest are: India, Japan and number four is us. Continuing: Russia, Turkey, Germany, Brazil and Iran.
Top 10 Copper
Chile grabs the gold. The rest: Peru, Democratic Republic of the Congo, China and we are number five. Continuing: Russia, Indonesia, Australia, Zambia and Mexico. Copper is needed in almost everything. It is why the metal is referred to as Dr. Copper.
Lithium
We include it because it is important today and even more important, tomorrow. Chile gets another gold. China, again and then, Argentina. The US is not on the list, but every list contains China. China also earns the most PH/Ds in education for engineers and mining. We are falling behind, badly.
I will add the most important product for any nation, auto production. It is connected to so many sectors of an economy: the interior, tires, transportation, electronics and technology. Japan and Germany dominate the list with GM at number 10. The EV market is being ruined by over capacity by China. Although by market capitalization, Tesla is the number one company in the world. We do not put much value in these type of stats. We classify this as a "Marketing Stat." Production and sales are what we believe counts and being number 10 is unacceptable in our book. Start tariffs at 50% and go up from there. Put more money in education to trade schools and maybe in four years, we can grab the top three spots in every category. Peace.
