Shorts and the Market

 In a nutshell, you buy when you think a firm's stock will rise and you sell when you feel that it will decline. This is the battle between the Bulls and Bears. This is the market. The history of price action within the market shows a bias toward buying. Even with the facts pointing to this conclusion, the pro-buyers has pushed for regulations against short sellers. You could only short a stock after an uptick. This is rigging! C'mon! In a down market, sellers would look to the most overpriced, overvalued company. However, the firm was probably declining with the market. You could not place your order because there was never an uptick. Anyway, that rule is no longer in place. Nevertheless, there are still limitations. If you decide to place a short sale with your broker, he must have shares to short. The only way that is available to the brokerage is margin shares. You may want to short a company, but you cannot purchase any shares. Story of life!

New Problem

If someone can build something, someone can find a weak link. In the past, the market has experienced heavy buying and selling. Generally, the market rises in steps like a staircase. It declines like an elevator. This has caused the market to put in place "circuit breakers." This is especially present in commodity trading. The market sets limits in daily action in the pits. In the exchanges, a pause may be put in place. This should have happened in the past two weeks. It is similar to what happened in the Capitol on January 6th. The Capitol Police knew of the dangers, but they did not take action. There inaction led to the results. The SEC did not take action. Big hedge funds and brokerage firms took heavy losses due to not utilizing the circuit breakers. The extreme number of orders overloaded the trading platforms. Margin calls were not able to be put in place due to settlement times. By the time the order was settled, the stock reversed its position. Now, we will hear a lot of whining. The problem is passing out the cheese. Biden won't help because he has his focus on the stimulus bill. This could be left to the bureaucrats. This means, rigging!

Economic Evangelist

wrote that he sees structural problems in our economy. This can only be fixed with quality jobs. If Biden gets his $15 minimum raise request granted, the relief will only be temporary. The market could resume its uptrend, but inflation will kill the wage gains. Quality jobs with a living wage is the only true answer for our deficit filled economy. So far, our Evangelist has been spot on! We see further declines in the market. At present, the commodities are indicating higher prices are coming. This is a diversion. However, not everything goes up in an up market and visa-versa. Keep an eye on Mosaic (MOS), X (US STEEL), and Dr. Copper. The market has a tendency to rotate into sectors on the way up and down. Chips have led this market up and they may lead it down. The market generally pauses after volatility like in the past month. It will digest and consolidate. The real conviction will be the action in King Dollar. We see it falling. If you want to live dangerously and you want to hop on the bandwagon of short sellers, this is the top ten.

*Ligand Pharmaceuticals 62%, Bed, Bath and Beyond 61%, Fubo TV 58%, Macerich 52%, AMC 52%, Pubmatic 51%, Tanger Factory Outlet 50%, Clovis 40%, Esperion 39%, and I Robot 37%.  

So, what is the "Short Squeeze?"

You think a stock is overvalued? You believe it should decline. You find that many investors agree with you as short interest in the shares is high. You place your position. Suddenly, high volume comes into the stock pushing it higher. Every uptick is money down the drain. You buy to cover, which in fact, pushes the stock higher. Other investors feel the pain and heat. They buy to cover and the stock rises again. The cycle will end, but one cannot remain solvent or convinced to ride out the story.  You have become a victim of the short squeeze. 

The most heavily shorted stock by dollar value is Tesla. 

Falling off a cliff...

So far, total losses by short sellers after one month in our new year is $71 billion. They had some wins, valued at $16 billion. The bottom line is $54 billion in the negative side of the ledger according to Ortex. The Russell 3000 has 68 stocks with 25% shorts according to Fact Set. The ten largest shorts are:

*GameStop, AMC, Bed, Bath and Beyond, National Beverage Co, I Robot, Pet Med Express, Macy's, Beyond Meat, Plug Power, Door Dash Inc, and Moderna. We said last week and we will repeat it here, this is a dangerous market! We still believe that after tomorrow and the "window dressing" period ends, the correction begins.

Odds and Ends: January 2021

- "Government is not the solution. Government is the problem." 

- Ronald Reagan 

- "Doing the same thing over and over again and seeking a new outcome is insanity."

- Albert Einstein 

This is where we are in 2021. President Biden believes government and its money, resources and power will solve any crisis, especially economic. The only thing that this thinking has provided is increasing debt, a lower standard of living and a devalued currency. This president is not alone. Every president after FDR has turned to this playbook when the economy turned south. There are two exceptions. President Eisenhower sought to balance the government. His term had a short recession, but the economy recovered on its own. We paid down our debt and the dollar had strong purchasing power. President Kennedy had stable prices in his abbreviated time. He, too, also had a balanced budget in one of his three years. His tax cut plan, enacted by Johnson took the economy to prosperity. One could argue about many other factors during every administration from climate to civil rights, but we are addressing the economy in this part of our work.

Stock Market says...

that the Biden administration is trying to be all things to all things. He won't make any waves. His cabinet reflects this: old cronies and lifelong bureaucrats. There will not be a "breakup" of big technology. Google is leading the charge higher and it is taking the market with it. The market is also saying that China will be our trading partner despite not fulfilling its agreed terms with the deal it signed with President Trump. China will renegotiate. Biden will claim a new, better deal. What he will get is the same old same old policy from China. Albert "E" should have dipped his toe in politics because his comment is "right on!" Of course, I am using it as a reflection to bureaucratic answers for the economy. Big Pharma will ride the virus to record earnings. Big Oil has hit a roadblock, but when prices rise, the restrictions will fade. Small business and large businesses are getting "free" money. Relief checks are coming. Evictions and foreclosures are on pause. No one looks ahead to when this ends or the money is spent? Alternative energy should benefit, but our Congress is a group of puppets. They will tow the party line and both parties are bought and paid for. They are in some unseen, rich assholes pocket. This is why real change is slow. It is not gridlock, but a democracy that does the bidding of the super rich and not the people. Like we said in our last piece, a stimulus economy is not an economic economy. 

What we see...

a rude awakening! Our Economic Evangelist wrote that the continual unemployment will soon factor into the markets equation. He said that the holiday hires would be dropped by the end of January. Here are the numbers so far: December 31st. = 787,000 claims; January 6th. = 803,000; January 14th. = 965,000; January 21st. = 900,000 claims. Total = 3,455.000. This is reality! When you combine the labor picture with the pandemic, it gets ugly, fast. Even if we could maintain one million vaccinations per day, it will take a year to cover the nation. Keep in mind that we have not reached this average and now, we have new strains from mutations to worry about along with bottlenecks in production and distribution. Then, there is this. Consider the stock. GameStop (GME)? It was $5 back in September. Rumors of bankruptcy circulated. It closed last Friday at $65.01. It was up 51% for the day. It has 141% shorts. NOTE: On Monday, it rocketed again to $159. Then, BOOM! fell to $78. On Tuesday, it flew up to $147. This is a dangerous market. 

Continuing, does Tesla (TSLA) make any money? How about Shopify (SHOP)? How about Bitcoin? Enough said!

Last Agreement...with Russia?

Time is up. The nuclear pact to curtail nuclear proliferation. Biden, in seeking to please all, will try to extend the pact. This is a good thing, but what about North Korea, China, India, Pakistan, Israel and Iran?

Flying Taxi?

It could be coming and soon. A new German startup, Lilium is developing an all-electric transport. It already has two European hubs and Orlando, Florida in the US. They will have competition from Volocopter. This firm is seeking to build an all-electric taxi. Have a good week. Peace. 

Stimulus Economy

-"C'mon, kid! Give me a break? I'm giving you the first one free!"

No, this is not some second rate crime show dialogue. Because within it, in plain sight, is a truth. One of today's problems, is deeper discussion. One could conclude on face value that there is no free lunch. Can't argue with that conclusion. Dig deeper. What is the offer? If it is marijuana, only a very small percentage of recipients will be negatively effected. This opens another argument - gateway to drugs. This is absolutely true. The odds are that almost anyone consuming other classifications of drugs, will be effected negatively. Dear Reader, this is not Evolution preaching. We used the above as a metaphor. It is only in relationship to the thinking of the new Biden administration. Here at Evolution, we see it as the same old same old.

If I asked you, what is the fastest growing sector in America? What would you say?

Rising Sector

POVERTY! There are 39.5 million Americans that live below the poverty level. Breaking down that number finds that there are over 12 million kids. This bodes poorly for the future US economy and innovation. Teachers feel the pain of the situation. However, in their empathy, they offer ideas that center around failure. They tell their students that if you feel that you can't make it, seek help. The helpline is government assistance. This is not teaching, but developing dependency. I'm all for the free lunch program and after school activities, but consider where this has gone. Kids learn to game the system for free wireless, free phones, free Obamacare, free food assistance, free rental assistance, utility assistance, even homeowner relief. The trails ends for now at government contracting. They don't learn how these helplines are paid for. They don't learn self-reliance. The founding fathers could not relate to today's government and what is happening in our schools.

How did this begin?

This is the central question. It happened piece-meal. The cold war that had fighting was in Korea. The close proximity of Japan resulted in Japan receiving an abundance of aid. This recharged their economy. Japan exported toys to the US. Then, they took advantage of the foolish, greedy idea of US car executives - planned obsolescence. US manufacturers thought that by planning the breakdown of parts, we could sell more, maybe even more cars? The Marshall Plan for Europe acted the same way. Once, the European economies returned, they sought to expand their market. They did. They dumped steel, and boatloads of their stuff on our shore. This began US deficits. Then, US producers who were always fighting unions, found a new technique to combat workers. Move the plant! Northern factories went south to non-unions states. Blacks were the first group in society to feel the pain. It would expand to all. Americans, with their resiliency and self-reliance developed the service economy. The pay was poor, but it paid the bills. Maybe something better will emerge. It didn't. Producers got Congress to outsource their business without ramifications like tariffs. This is what is killing the US economy, our standard of living and our future. Government responded in a piece-meal fashion. The band-aid was stimulus. Stimulus is medicine to get by. It has a time limit. When the cash is spent, it is expired! The root cause of our economic problems lies in the fact that Congress has not protected the general welfare. Any import should be taxed by tariffs. Any US imports should be taxed too. The tax should be high enough to protect a similar US producing concern. All foreign nations use protectionism, especially with state sponsored entities. This is where it began. This is what we need to address. Government assistance is not an economic economy!

2 Other Fears...

Like I stated above and we have seen in the past, stimulus is a band-aid. The fear that I now feel is the "give me and I want" people will use the present mood to push their small minded ideas. The first, is cancelling student loan debt. The figure is past one trillion. The proponents argue that the economy is being held back from growing because the ex-students have too much debt to purchase a car or a home. They are living at home and not starting families of their own. This is a half truth. Why? Let's look at  education loans. Students used this money for more than tuition. It was room and board. Many bought a car with the money. It became there life-style. I resent giving them an out from their debt. The choice like many before them was to delay self-gratification. Don't take free money. Get a job! If you have no other options, enter the military and utilize the GI Bill. Plan ahead! Take responsibility for your actions. I'm against anyone who is for cancelling student debt.

The other fear is related to the first. One could argue that the depreciating value of our currency and the decline in our standard of living could be traced to the Federal Reserve. Education cost many times more today than when I went to college. Inflation is the culprit. By the way, education has its own inflation. It is not just tuition, room and board. It is in degrees. At one time a college diploma could get you a leg up for a job. Then, the stakes were upped to a "Master Degree." Now, it is a PH-D. Anyway, the Federal Reserve is looking to expand their power. In doing so, they will destroy our democracy. Thomas Jefferson would lead the charge against these tyrannical, greedy idiots. They will seek to end cash as in a "cashless society." Idiots in Sweden are already changing their society to one where no one will accept cash for payment. This ends financial freedom. Future stimulus will be a credit card. The Fed does not want you to use cash. This is their first step and they already have a grab on our society. Use your smartphone at the checkout. Don't see money. Don't budget money. Don't understand the value of money. Don't use money! I say, "Give me Liberty or give me death!" End the Fed!

GOLD: It's Next Direction

The election is over except for the crying. When Trump won in 2016, the Democrats cried for four years. They did nothing for America. They are a disgrace to JFKs, Profiles In Courage.

Now, we face four years of Republicans crying. They never read JFKs work. They only read profit and loss statements. The only truth about the party is their initials, GOP - Guardians of Privilege.

This is America. When the people cry for real change, they get labels like Populism. There is little change. This reality has a label. It is called Gridlock. As the dust clears, we will be able to see the tears of the losers. We will be able to see the tears of joy for the winners. We will never get to see the tears of pain by citizens who are suffering due to the pandemic, loss of work and all the repercussions of the two issues. As the lingering effects of the last stimulus fades and new data shows the increase in bankruptcies, a call to end bipartisanship will emerge. This will be nothing more than someone seeking to imprint their name on the national scene. Politicians are already looking at 2022. They have no interest other than ego. Maybe because Congress consists of millionaires and not real people with first hand knowledge of what life is really like in America. This is why I call for a new third political party for the people, the Liberty Party.

Nevertheless, whatever happens from impeachment to stimulus, it will effect the stock market, our economy and currency. The market is fooling themselves under the eye of greed. Reality will hit the market and them like a car skidding on ice at an on coming truck.

I have already provided you with insights to our dollar. My calls have been correct and the dollar will fall into a new range of 86 to 92. This devaluation will be good for gold. In addition, the stimulus talk will only cause more dollars to be printed which is also a positive for gold. By the way, this is the year of the white metal (read silver) according to the Chinese zodiac. Biden will push for another $1400 to make the original talk of $2,000 a reality. The dollar will not only be hit by stimulus, but medical costs for vaccines, for other stimulus like infrastructure and projects for reelection by politicians, especially Republicans. They will sell their vote in private to democrats for legislation. After last weeks disgrace by Trump's followers, people will forget that the "Donald" even advocated the $2,000 check. 

The real important aspect will be the timing of whatever comes forth as stimulus. The Democrats will seek impeachment again. They want to put the nail in the coffin on Trump. The Republican politicians will be looking at 2022. They will do nothing for America unless they can spin some positives for themselves. They want Biden and the Democrats to fail. It is like the Eagles song, Lying Eyes. 

If the stimulus talk is pushed back until after the inaugural, the timing will be too late. The whole event will drag out until spring. By that time, we, at Evolution see a "M" economy. The pattern is already appearing. The first leg down was last March. Then, we had a quick recovery after the lockdown. The present second wave is casting doubts about the recovery. The election results will raise hopes. Reality will cause everything to crash. This completes the pattern. How long it lasts can only be told as it happens. 

Bonds...

are saying that a good stimulus plan is fading fast. Price levels suggest that inflation is awakening. The real trendline will appear by the end of January. By that time the number of bankruptcies will be alarming. Unemployment has fallen to 6.7%. It will probably drop even further due to the holiday season hiring. When the layoffs start hitting over 750,000 each week by the end of January, the trendline will have its new direction. In addition, so will the price of gold.

Gold Trendline...

had been in correction mode since 7th of August when gold hit its new all-time high of $2062.50. It found a resistance bottom at $1850. Last week this down, trendline was broken. Last Friday, it surged upward on strong volume to $1951.70. Gold got confirmation with GDX. GDX rose from the corrective low of $36 to close at $41.42. Yes, they whacked god again last week, but when the knowledge and reality of spending and taxes and more spending hits the news, gold will soar. Gold is forming a "W" pattern.

2cd. Opinion

There are other ways to look at gold. One can see the miners are rising. This is harmony in the sector. There are the historical references like the price of one ounce of gold to the Dow Jones price. When the ratio is one, gold is fairly priced. Given this aspect, the price of gold has a long ways to go. Then, you can view charts with inflation adjusted price? Then, you can look at the relative evaluation of gold to the price of gold miners? You can relate the price of gold to the Federal Reserve balance sheet? You can also see how the ETFs in gold will raise the price of the miners when the gold price rises. By the way, the ETFs have more gold under their portfolio than ever before. All of these are check marks for certain people. These are stat guys. They are like football bettors who want to know how a team does on grass as opposed to artificial turf. I like some of their studies, but our Economic Evangelist is more practical. He uses this study.

!965 Ford Mustang...

sold for $1995. The price of gold that year was $35.12. Keep in mind the price of gold was suppressed until Nixon's move to drop the gold standard in 1971. The Dow Jones was at 969 in 1965. You could also buy a Hershey candy bar for .05 cents. Today, that candy bar costs more than one dollar. Inflation caused a 20x price increase. Inflation shows the effects of devaluation. Devaluation's chief cause is by excessive printing. Stimulus is printing. Our model uses the previous high of gold. This was in 1980. It reached $850. A new 1980 Ford Mustang cost $5338. So, if we use that price when gold was free to trade on the market and divide it into the cost of a 2021 model, inflation points to 5x. If we multiply $850 by 5x (times), we get a price for gold. It is $4250. I don't think fiat governments will let that happen. They will use all their power to intervene. However, they cannot stop gold completely. Continue the exercise.

A new 2021 Ford Mustang can be purchased for $26,900. However, a top line version costs over $74,000. How about those numbers for the value of the dollar that is destroyed by inflation. Inflation also acts positive for gold. Gold never really loses its value. By using this example. we expect gold to rise to a minimum of $2650. and as high as $3700.  

As stated in previous pieces, we like four gold miners along with gold or silver coins. One in the group can be replaced by a fellow miner in Australia. Newcrest Gold is good, but Kirkland Lake Gold (KL) could be better. We also like Barrick Gold (GOLD), Wheaton Precious Metals (WPM), and Argonaut Gold (ARNGF). Dear Reader, at least, American readers, if you make out well with gold, buy an American car. Maybe the electric Mustang? It is beautiful. Peace.

2021 Forecast

 "A point is reached where the trend is reversed and becomes self-reinforcing in the opposite direction."

- George Soros

What Georgie boy is talking about is what people perceive to be true. The stock market's truth is that central banks and in the US, the Federal Reserve will have the market's back. Back in the day, when you had unemployment offices, people could see immediately the state of the economy. In fact, they even found themselves on the line. Today, computers help mask the state of the economy. However people get their information today, the one central theme is central banks will keep interest rates low to help housing, business and consumers. They will also buy bonds from the market. It does not matter whether the issuing firms are worthy of purchase. By the way, a similar report says that 19% of loans are not being paid, but the firms have continued to exist due to the last government stimulus.  This is a market condition tell. We, at Evolution have been adding the pluses and minuses of our present economy. This is what we see...

December's Claims:

Dec 4th. = 712,000, Dec 10th. = 835,000, Dec 16tn. = 751,000, Dec 23th. = 803,000 and Dec 31st. = 787,000. This equals about an average of 780,000 unemployment claims per week. I remind you that during the Christmas selling season, retail, as well as, all delivery and warehouse companies hire seasonal help. To have 3.88 million file for claims during this season is a tell. The post Christmas time is also busy with returns. This will end around the time President-Elect Biden has his inaugural. If we are right, we expect a huge spike in unemployment claims around that time. Biden will push for a new stimulus program. Politicians forget the truth of science, "For every action, there is an equal reaction." Stimulus is money printing. Every dollar that is printed lowers the value of the currency. One can see this very clearly in the recent rally in commodities. When the dollar declines, prices rise, especially in commodities. If you recall in past pieces, we posted a report by the St. Louis Fed in the 1980s. It stated the lag time for new money to circulate is around 12-months. The Fed knows this. They will let inflation ride with the gamble that they can control the narrative until the spike in inflation abates. This would indicate that inflation will appear, but for how long will be the point of contention. There is a new debate about this effect and report. Harry Dent says the Fed's money printing is an attempt to fight deflation. Harry is a leader in forecasting an economy based on demographics. He has a simple truth and it leads to a dual tell. The first is that we are in agreement in the economies outlook and even the timeline, but for different reasons.

2cd. Opinion

Harry Dent's theory is a reflection of the birth to grave cycle. When babies are born, diapers are selling. Teenagers drink soda and eat chips. When one reaches twenty or so, cars are flying off the lots.  By the time thirty hits the calendar, people look to purchase their first home. This ignites the real estate cycle. As time moves along, some get second cars and vacation homes as well as insurance. The last years might include some travel, but liquidation appears. This is where we are in his cycle theory. One no longer needs a second or vacation home. Medical concerns begin to rise until the call comes to the funeral parlor. According to Dent, our demographics point is the call to the morgue. We are not selling diapers, sodas, cars, real estate, whatever. The lack of buying will cause overpriced products to die in store. The overvalued stock market will crash by 40% in late April says Dent.  

Our View

We, at Evolution use a hybrid of fundamentals as well as charts. The charts are at highs, however there is a huge gap with high volume last March. This needs to be tested. This is the first point. The next is a fundamental point. It is the retail catastrophe due to the internet. The mall is dying by a thousand cuts. The last stimulus has prevented many firms from declaring bankruptcy. The airline industry has lost over $35 billion in 2020. Millions of renters were saved by the moratorium on evictions as well as homeowners with foreclosure. The stock market is at highs, but the market has many deceptions. The Dow is manipulated as well as the S&P 500. For example Tesla is added. Apple gets an oversized percentage of the theory. In the meantime, there is no longer 5,000 firms listed. Where did they go? Some have merged, but most are out of business due to imports. I know that I have bounced around with details, but getting back to stimulus and the consumer. When someone has a job and spends in their region, this is the movement or velocity of money. The better the economy, the higher the rate. Today, the Fed's low interest rates barely moves the velocity of money. Consumers need money for basics like food and shelter. The rate of velocity is minimal. This is a serious flaw in our economy. This is another tell.  

Oil

This is the most important commodity. When people stay home, they do not need their vehicle. Gas stations sell less gasoline. Stores sell less product. Keep in mind that plastics use a lot of oil. When oil declines in price, airlines save money on fuel. This is good unless no one is flying and no one is flying due to the pandemic. The market sees hope in the vaccine. They look beyond the day-to-day problems like the low rollout of vaccinations. In addition, they will give the new administration a honeymoon period. The virus will cut short the expectation period. Biden's picks are all old cronies. You cannot go back in time. Government needs new thinking and direction. The Democrats won't help and the Republicans won't help the democrats. Gridlock won't help Americans. The outlook is bleak. Back to oil, it acted like the canary in the coal mine. It points to a shrinking economy. We have more oil than we need. The whole industry is being challenged by climate matters and electric cars. Not good as the industry offers high wages to an economy suffering from the loss of middle-class jobs. Another tell.

CORVID-19

The virus news seems to get worse and worse. It will be over soon. It is always darkest before dawn. The market keeps a positive look in this respect. However, it fails to see the real effects to Main Street. We lost almost four million jobs in December which is usually a job creating time. The downturn in jobs that the end of January brings will begin to enter the psyche of the market. This point will grow with every bad news revelation. The point of reversal that Soros talked about will enter into the equation. The Ides of March will assassinate many a portfolio. The crash will follow. 

Odds and Ends: December 2020

 Time keeps on moving...no one foresaw the financial setbacks of this year. The market keeps moving in an uptrend despite all the dangers. Since March, unemployment claims have averaged over 900,000 every week. If not for Payroll Protection Program (PPP), free government loans and forbearance edicts, the economy would be at a standstill and homelessness would be rampant.

One reason why at Evolution, we feel the market keeps hitting new highs is due to cannibalism. When enough shorts appear, bigger funds attack their position by buying. The fear factor is the same whether $100 or $100 million. The old saying is true, "The market can behave irrationally longer than you can remain solvent."

Over 5,000 Pages...an counting...

The would be, could be, new stimulus bill hit a political snag. President Trump has begun his 2024 campaign by demanding citizens receive $2,000 each under the bill. President-elect Biden made his response commercial that he will use for his campaign. It gives him an excuse if his first term fails. He blames Trump for a weak vaccination rollout, passage of stimulus and an overall poor economy. The bill is over 5,000 pages. Dear Reader, can you read a boring, legal document that is that long in less than five days? This is another example of what is wrong with our government. This bill like almost every act, allows pork barrel. A bought off member of Congress puts in pork with this known point: I won't vote in agreement unless you add my addition. This is why the defense bill will pass because too much money influences our weak minded politicians. We will never have peace until we rid ourselves of the warmongers. They waste lives and resources. We could those riches to build a better nation In a related aspect, we had a peek at the previous bill. It had the old...

3 - Martini Lunch...

in it. It provided tax free money for the PPP, this would give small business a negative tax rate to which the IRS says is illegal. The "Double-Dip" a.k.a. George Costanza of Steinfeld fame is the way that I dip my chip, "I dip. I bite and then, I dip again." It also allows firms to endanger workers without the fear of a lawsuit. My eyes are getting stressed from working on my computer/screen. Is there anything in the bill about that?

Apple 

is finally getting smart about their product. They have sent a redirection in the company. Now, they will build their own chips, modems, etc. In this way, they can prevent copy-cat products by competitors. This will put a crimp in stealing intellectual property unless they continue to make their products in China. Not all the news on Apple is positive. They lost their lawsuit versus Corellium over the "Virtual I-phone."😢 😡.

In a related aspect, Video Curl says Nvidia and AMD will not be able to meet demand until the 2cd. quarter of 2021.   

New Radar

by using light. Company called Luminar is advancing the technology and system.

Nuclear Fusion...might not only be possible, but it could be coming which adds another long-term problem for oil firms. In a related aspect, watch uranium mining firms. They are popping. Why, you ask? The US Senate Committee has approved a bipartisan bill aimed at establishing a US national reserve of uranium.

Fed Report...

by the St. Louis Fed back in the 1980s stated that it takes at least 12-quarters in lag time to reflect changes in money policy in the money supply. With all the printing and probably, more to come, M-2 points to gold rising to $2400 in 2021. In a related aspect...

New Data...

on housing points to serious problems within the industry. Home owners have been hanging on and many with the help of the forbearance rules. This ends in March 2021. In addition, the moratorium on evictions as 11.4 million households owe over $6,000 each. Collectively, this amounts to $70 billion. Moody's Analytics estimates that any new stimulus will not reach these people in time. Not good.  Many have not made payments with these protections. However, the payments can be ballooned along with fees. To me, this spells another foreclosure problem. Just like the crisis in 2008 which led to less home ownership and more rentals, this will push the US into a rental nation. The growing list of consumers with bad credit won't help our economy. The data points to the rule of real estate: location, location, location. The following five are already showing signs of strain.

*Miami = 12% of all loans are delinquent. *New York = 11% of all loans are delinquent. *Las Vegas = 10% of all loans are delinquent. *Houston = 10% of all loans are delinquent. * Chicago = 8% arrears.

As time moves to the new year, maybe we can find some solace in the Chinese Horoscope.  I felt a negative vibe at this time last year when 2020 was called the Year of the Rat. This was suppose to be good under the Chinese predicable history. At that time I reminded readers that a rat is never good in US culture. Next year is the Year of the White Metal OX or Bull. No wonder the stock market is rising as it always looks ahead. The Ox is hard working and resilient. These are good American traits. Let's hope for the best and keep in mind, the white metal is silver. We, at Evolution like that.     

Truth in Comedy - Where are you, Bud and Lou?

I could talk about the many triangle patterns in the charts. They are generally a continuation pattern. This fits our forecast that seasonality will prevail in the marketplace until January. I could mention that we see the worst possible outcome for retail, especially small businesses. All those onloaded shipping containers will eventually be unloaded. The problem is timing. When retail receives the merchandise, the Christmas buying season will be over. There is also the return aspect for all companies, whether online or brick and mortar. In both cases, seasonal layoffs will result in dissatisfied consumers. Many firms will lose money due to inflation, labor shortages and product shortages. Our call for a market correction in January is looking better and better. So, let us hope that we are wrong and enjoy each other while we can. However, our nation needs someone to challenge both political parties and their "yes-men" who run our government agencies. The following replay is an example of what I mean. Enjoy...

As promised, a Christmas present to you. It is from the 1930s. The comic genius of Abbott and Costello was true then as it is today. Politicians came up with this lie for many reasons. You might want to forgive them under one aspect in that it is skewed for the positive. Today, it is out and out corruption to hide the fact that the best jobs along with their wages in our economy have been outsourced to foreign lands. Politicians are bought! Producers are free in our free society, but government should be looking out for the welfare of the nation. Tariffs should have been the standard reply for any outsourced product. It didn't happen because politicians are weak, bought off, spineless souls who have no conscious. This is what is wrong with our democracy. Now, forgive my rant and enjoy this truthful, comic genius.

Costello: I want to talk about the unemployment rate in America.

Abbott: Good subject. Terrible Times. It is 7.8%.

Costello: That many people are out of work?

Abbott: No, that's 14.7%.

Costello: You just said 7.8%.

Abbott: 7.8% unemployed.

Costello: Right - 7.8% out of work.

Abbott: No, that's 14.7%.

Costello: WAIT A MINUTE! Is it 7.8% or 14.7%?

Abbott: 7.8% are unemployed. 14.7% are out of work.

Costello: If you are out of work, you are unemployed.

Abbott: No. Government said you can't count the "Out of Work" as the unemployed. You have to look for work to be unemployed.

Costello: BUT THEY ARE ALL OUT OF WORK!!!

Abbott: No, you miss the point.

Costello: What point?

Abbott: Someone who doesn't look for work can't be counted with those who look for work. It wouldn't be fair.

Costello: To whom?

Abbott: The unemployed.

Costello: BUT ALL of them are out of work.

Abbott: No, the unemployed are actively looking for work. Those who are out of work gave up looking, and if you give up looking, you are no longer in the ranks of the unemployed.

Costello: So, if you're off the unemployment roles that counts as less unemployment?

Abbott: Unemployment would go down. Absolutely! 

Costello: The unemployment just goes down because you don't look for work? 

Abbott: Absolutely, it goes down. That's how it gets to 7.8%. Otherwise, it would be 14.7%.

Costello: Wait! I got a question for you. That means there are two ways to bring down the unemployment number.

Abbott: Two ways is correct.

Costello: Unemployment can go down if someone gets a job? 

Abbott: Correct.

Costello: And it can also go down if you stop looking for a job?

Abbott: Bingo.

Costello: So, there are two ways to bring unemployment down, and the easier of the two, is to have people stop looking for work.

Abbott: Now, you're thinking like an Economist.

Costello: I don't even know what the hell I just said.

Abbott: Now, you're thinking like a Politician.

You can clearly see that nothing has really changed since the Great Depression. At one time you could argue that the Democrats were for the working people, but that is no longer true. It is why I suggest that we need a new third political party that is for the people. The "LIBERTY PARTY" would promote the general welfare and end all foreign entanglements. 

The next short piece reveals many problems in America today, but within it is hope, just like the Christ-child offers hope at Christmas time. Jacob Blake, a black man, was stopped by police with his three children in the car. The stop became a tragedy as Blake was shots even times in the back. A riot followed. His mother, Julia Jackson said, "Her son would not be happy with the damage to the community or by the actions of its residence." She continues by saying that she is praying for healing. She goes on to say, "We are the United States, but we are losing our ability to be united. A house against each other cannot stand!" She is praying for the police, the community and the nation. She ends in tears by saying, "America is great when we behave greatly."

She is a reflection of love and this is God's gift to us at Christmas. MERRY CHRISTMAS, PEACE.