The Long Term Investor

I can not read this report....because I do not subscribe to the NYT. But.....from the headline I know what it is all about. THIS is exactly the reason that many people are better off to simply invest in a large.....passive.....index fund. One of the best is the SP500 Index. It is nearly impossible for any of the financial advisors and funds to beat this average over the long term. Most dont even beat it consistently over the short term. A good lesson to remember if you are considering hiring someone to "manage" your money.

Mutual Funds That Consistently Beat the Market? Not One of 2,132.
https://www.nytimes.com/2022/12/02/business/stock-market-index-funds.html

"No actively managed stock or bond funds outperformed the market convincingly and regularly over the last five years. Index funds have generally been better.

It’s very hard to beat the stock or bond markets with any regularity.

Each year, some investors manage to do it, of course, but can they do it consistently? A new study of actively managed mutual funds by S&P Dow Jones Indices asked that question and came up with a startling result.

It found that not a single mutual fund — not one — managed to beat its benchmark in either the U.S. stock or bond markets regularly and convincingly over the last five years. These results are even worse than those of 2014 and 2015, when I last examined this subject closely."

MY COMMENT

NO.....I dont even need to see the rest of the article. This has been the norm for a very long time. The MYTH of the great money manager that can make you rich.

There are other good reason to use a financial advisor......the best is if you need someone to be a firewall between you and your emotions and your bad investing habits. BUT......in all probability.....they will NOT beat the general averages for the long term.

Once in a very rare while there are exceptions. One was Peter Lynch and his Magellan Fund. My mom and I rode that fund for a long time till he retired. After he left.......I moved over to the Fidelity Contra Fund......which has generally kept even or slightly ahead of the SP500. Lynch was smart and retired at an early age with a great record. He was smart enough to go out while on top.

 

I did a brief post about Costco last night. I have owned that company a long time and we were shoppers in one of their first stores in the Seattle area. An amazing company......that for the life of the company has had GREAT MANAGEMENT.

Look at all the big cap amazing TECH companies and other companies in the ten stocks that I own. YET......it is COSTCO that is my leader in capital gains and has the LARGEST GAIN of any stock that I own over the years.

Meet Yahoo Finance's 2022 Company of the Year: Costco

https://finance.yahoo.com/news/meet-yahoo-finances-2022-company-of-the-year-costco-050135263.html

(BOLD is my opinion OR what I consider important content)

"In a year of rampant inflation—not seen since the early 1980s—Costco (COST) was a warm hug to millions of loyal members by keeping prices for everything from food to gasoline as low as possible, just as rivals were aggressively jacking up prices.

It also provided a warm hug to its fans on Wall Street, producing stellar results from sizable same-store sales increases to its stock price, which got the best of the S&P 500 (^GSPC) index. Not to mention its sales of $222.7 billion in the fiscal year ended October, up a whopping 16 percent.

For that and more—including Costco's continued status as one of the nation's best employers—we named the Issaquah, Washington–based warehouse behemoth our 2022 Company of the Year.

If there were one company that could say rising prices weren't a negative, it was Costco. The Great Inflationary Outbreak of 2022 placed Costco's 842 worldwide stores squarely under the spotlight, offering up yet another opportunity for the 39-year-old retailer to showcase, to investors and members, its low-price leadership chops.

Consider CephasSund from Los Angeles, California.The Costco cardholder, who loves organic products, says he shopped at conventional grocery stores prior to 2022, but skyrocketing prices put a hard stop on many of those excursions. "When organic produce at the grocery stores is almost double what it cost at Costco, you (can) see where the savings quickly added up," Sund said.

Sund and other customers we talked to said pretty much the same thing: Costco is a trusted retailer who had their backs throughout a challenging economic year. (That ought to tell you something.)

How? As the cost of items like toothpaste and eggs soared, Costco in most cases was the last to raise prices at its cavernous 146,000-square-foot stores, explained Jefferies retail analyst Corey Tarlowe. "The company is very strict on price, and I think that is evident through its steadfast commitment to its $1.50 hot dog and soda combo, competitive gas prices, and $4.99 rotisserie chickens," Tarlowe explained.

Case in point: As gas prices spiked to more than $5.00 a gallon in the summer, Costco saw lines at its hundreds of U.S. gas stations stretch out onto highways. Why? The company stayed true to its DNA as a wholesaler and kept gas prices at the lowest levels in town. Tarlowe says Costco's gas prices have typically been $0.25-$1.00 a gallon cheaper than the next closest competitor. (GasBuddy, a fuel station app, said Costco was the cheapest fuel station nationwide for the fifth year in a row.

Costco held the line in other ways, too.

As Walmart-owned Sam's Club jacked up membership prices by $5-$10 in September, Costco held firm. Execs said it wasn't the right time to tax consumers dealing with runaway inflation. (Sam's did undercut Costco's hot dog/drink combo by 12 cents. You can't win them all.)

All of those warm embraces of customers was just Costco being Costco, long-time CEO Craig Jelinek told Yahoo Finance in an exclusive interview inside a new club opening in Lake Stevens, Washington.

"I think first of all, we've been very fortunate. We've got great employees, and every company is only as good as everybody around them," said Jelinek, who has been with the company since nearly the time of its founding in 1984 by Jeffrey Brotman and Jim Sinegal. "We've persevered and, we're very pleased that we've been able to get merchandise and continue to create value for our members and grow our membership base and drive sales."

This isn't a surprise to the retailer's long-time followers on Wall Street.

Goldman Sachs' Kate McShane, for instance, has covered Costco for years. The company's focus on low prices and stellar operational execution is etched in the fabric of the retailer and has served the company well for years in good times and bad, she explained. The "get it done" mindset harkens back to the company's co-founders Jim Sinegal and Jeffrey Brotman, who created a no frills atmosphere that put the member at the center.

"They're definitely one of the best run, best-in-class retailers," McShane said. "We've not necessarily been that surprised Costco has been gaining market share as a result of some of the macroeconomic dynamics."

Experts like McShane believe Costco has gained market share notably in food throughout the pandemic, primarily from selling high quality private label products under its popular Kirkland Signature brand.

Here are some Company of the Year worthy (and Wall Street-pleasing) highlights from the past year:

Costco's same-store sales have out-performed conventional competitors

Costco's U.S. same-store sales for the nine-weeks ended October 30 increased by 10%. By comparison, third-quarter same-store sales for discounters Walmart (WMT) U.S. and Target (TGT) rose by a far slower 8.2% and 2.7%, respectively. Stacked up against its pure play warehouse rivals, Costco's recent sales growth trends are more in line. East Coast warehouse club rival BJ's Wholesale (BJ) saw third-quarter same-store sales increase by 9.7%. Same-store sales at Walmart's Sam's Club, increased 10% in the third quarter. But given that Costco is much bigger than the likes of Sam's, which has sales of about $59 billion, those same-store sales figures are impressive.

Costco had a bang-up year within its key operating metrics

For the fiscal year-ended Aug. 28, Costco posted a 14.4% overall same-store sales increase; a 93% renewal rate for U.S. members; the addition of 7.3 million members; and a slight increase in net profit margins (a win in the hyper inflationary environment). Meanwhile, total cash clocked in at $11.1 billion, representing a hearty 34% of current assets.

Despite 12-months of rock solid financial performance, the stock is down 13% this year, as of Dec. 2, but that still beats the S&P 500 by a couple percentage points. Not bad in a year where bear markets reigned supreme.

"We're really the extreme value proposition," Costco's 30-plus year CFO Richard Galanti told Yahoo Finance of the warehouse chain's financial success in a year of of eye-popping inflation.

But like any other retailer, there are always uncertainties lurking.

Analysts contend Costco's often relatively "expensive" price-to-earnings multiple — reflective of its years of steady and strong financials — requires the company to be perfect operationally at every turn.

"The valuation on Costco, I can I can tell you, does give some people some angst because they are at such a big premium to the market. They're at such a big premium to Walmart and other big box retailers that some people don't totally understand why or they can't really bridge the gap between them," Goldman's McShane said.

Costco didn't have a perfect November, as same-store sales growth cooled versus October, the company reported on Nov. 30. Investors promptly punished the often teflon stock on the view 2023 would bring further sales slowdowns.

Another wild card for 2023 is membership fees.Costco could raise them after years of holding the line, much to the disappointment of Wall Street. That would, of course, increase revenues and profits, but could also turn off some loyal, still inflation-weary, customers.

Costco's last membership fee increase kicked in on June 1, 2017. The warehouse club took its Gold Star membership (the entry level Costco membership) fee up $5 to $60 and executive membership (offers 2% rewards on qualified purchases and other perks) fees increased by $10 to $120.

"You're likely to hear something about this in the next (earnings) call in maybe six to 12 months, I think, and it'll probably be pretty likely that we'll hear something about it at least upcoming on the next earnings call," said Jefferies analyst Tarlowe. He estimates that a membership fee increase could boost Costco's earnings growth by a "mid-single digit percentage" rate. A Costco bull, he doesn't believe such a hike is priced into the retailer's already relatively expensive stock.

Costco's CFO Galanti said the retailer isn't ready to raise the cost of its membership, but it will be something it clearly outlines to Wall Street when and if the time comes. Growth will also be driven by opening 20 to 25 new warehouses a year and the existing business drivers, Galanti added.

In the meantime, Jelinek is paying careful attention to consumer spending this holiday season amid the mixed economic backdrop. Jelinek says he is pleased with the trends in the business to kick off the holiday shopping season, but does see a few warning flags that amount to uncertainties headed into 2023.

"You know, a little bit. A little bit," Jelinek replied when asked if he sees a recession forming in the U.S. "Our jewelry business has slowed down. If you look at the really high-end television sets, they've slowed down. I think right now people are very, very value conscious. They're always value conscious, but I think more so now than ever."

What the 70-year-old Jelinek may see forming, however, is a well-deserved retirement sometime within the next couple of years. In February, Costco promoted Ron Vachris to president and COO. He also joined Jelinek and Galanti on Costco's board of directors.

Vachris, 56, has similar merchant DNA to Jelinek and Costco's founders. He began his retail career at the age of 16 at Price Club, which merged with Costco in 1993. Yahoo Finance briefly chatted with Vachris inside the Washington store opening — he was in true merchant form, walking aisles and chatting with members.

Jelinek played any potential retirement announcement close to the vest.

"Let's put it this way. He's [Ron] president. And we'll let it go at that," Jelinek said when asked about succession, adding he plans to be CEO "for a while."

Costco's faithful members and employees surely would be OK with that timeline."

MY COMMENT

This is an AMAZING company for one simple reason......GREAT long term MANAGEMENT. Much of their success is their CEO who has been with the company from the very beginning.

This is a company that grows managers in-house and sticks to what has worked for them since their founding in 1984. They are a marketing and service genius. They never lose track of serving their members and their initial business concept.

They will lose some of their long term executives over the next 5-10 years. Lets hope they promote managers that have learned the Costco culture and simple lessons of success.

HERE.....is the simple secret of the success of this company:

"The company's focus on low prices and stellar operational execution is etched in the fabric of the retailer and has served the company well for years in good times and bad, she explained. The "get it done" mindset harkens back to the company's co-founders Jim Sinegal and Jeffrey Brotman, who created a no frills atmosphere that put the member at the center."

AMAZING......."put the customer at the center".....NOT the CEO or other executives.

 

NO substance to the markets today.....just negative drift.....based on NOTHING of business substance.

Stocks fall ahead of more economic data

https://finance.yahoo.com/news/stock-market-news-live-updates-december-5-125408828.html

(BOLD is my opinion OR what I consider important content)

"U.S. stocks sunk Monday ahead of another wave of economic data out this week.

The S&P 500 (^GSPC) moved lower by 0.9% in early morning trading, while the Dow Jones Industrial Average (^DJI) down by 0.8%, or 270 points. The technology-heavy Nasdaq Composite (^IXIC) fell by 0.9%.

Stocks finished mixed on Friday as investors digested hotter-than-expected jobs data. The strong job gains and robust wage growth are the opposite of what the Federal Reserve would like to see in its battle against inflation. Friday’s figures showed demand for workers remains out of balance with supply, signaling to Fed policymakers to either take rates higher than previously anticipated or them higher for longer in restrictive territory.

The narrative from U.S. central bank officials, now in their pre-meeting blackout period, has suggested they would downshift to a half-point hike at their Dec. 13-14 meeting, after four consecutive 75 basis-point increases. Investors are now wondering how much longer will the central bank continue to hold its tightening campaign, how high the federal funds rate will end up, and how long it will stay there.

“It's fascinating that at the moment the market is focusing squarely on the very strong likelihood that we'll ratchet down to 'only' a 50bps hike next week and extrapolating that level of dovishness rather than focus on any risks that the terminal rate could end up being nearer say 6% than 5%,” Jim Reid and colleagues at Deutsche Bank wrote in an early morning note Monday.

Leading the economic calendar for the week are new readings on the producer price index (PPI) — which measures prices paid for goods and services before they reach consumers and consumer sentiment. On Monday, the ISM Manufacturing Index expanded faster in November 56.5 compared to estimates of 53.5, which is above October’s reading of 54.4. In a separate report, the Purchasing Managers’ Index (PMI) is 46.2 in November, down from the October reading of 47.8. New business activity fell at the sharpest rate since May 2020.

Meanwhile, another batch of third-quarter earnings figures will be out, finishing off the reporting season.

The yield on the benchmark 10-year Treasury note moved back up past 3.5%, while oil prices traded higher, with crude futures at $81.64 per barrel. On Sunday, OPEC+, or the Organization of the Petroleum Exporting Countries and its allies, including Russia, stayed the course on production cuts. October’s decision was confirmed at a meeting on Dec. 4, ahead of the implementation of a $60 price cap on Russian-origin crude oil negotiated by the EU, the G7, and Australia.

Tesla (TSLA) shares sank nearly 5% in the early trade after Bloomberg reported that the company plans to cut production at its Shanghai factory, the latest sign of weak demand in China.

Overseas, Asian equities jumped on Monday after local Chinese authorities downgraded some of their strict COVID policies after public protests last week led to a major shift in Beijing’s commitment to its zero-COVID policy.

Elsewhere, in crypto world, Sam Bankman-Fried said he will testify before the House Financial Services Committee after he finishes "learning and reviewing what happened" in the collapse of FTX, the crypto exchange he founded."

MY COMMENT

YES.....another day in the 2022 market. A market that is based on.......NOTHING......but short term drama and economic data.

If I had to guess how it all will play out between now and the end of the year I would say more of the same......NOTHING. I always HOPE for a year end rally.......and I am HOPING for one this year. BUT....if I had to bet real money on it.....I would say it is not likely. We will "probably" see the markets end the year with more of the same "stuff" that we have lived through for the past six months.

BUT......as a long term focused investor:

I continue to be fully invested for the long term as usual.

 

ONWARD and UPWARD.

 

You know as a person that has 55+ years of INSTITUTIONAL MEMORY of the markets and investing.......one thing is sure......nothing stays the same in society. We have seen the rise of TABLOID JOURNALISM across all media sources....even sports.

NOW....over the past 5-10 years we have seen the same thing ENGULF the financial media. We are now at the point where it is all about sensationalism and opinion. Usually from sources and writers......that have ZERO understanding of actual business......because they are too young and do not have any real investing or business experience.

THUS.....we now have the day to day markets totally distorted as a result and totally disconnected from......actual....business and company reality. EARNINGS don't matter anymore. The very nice third quarter earnings dont matter. The split government doesn't matter. It is all about the day to day drama that can be ginned up.

That is the REALITY of the current markets today......and.....for most of this year. For investors......get used to it......that is the NEW reality and the NEW normal for the short to medium term markets. In the ancient, old days......way back 15 or more years ago.....the markets were not driven like they are now by the day to day FLUFF and the HYPE of every economic release. Business results actually mattered. We actually had investors that called themselves......FUNDAMENTAL INVESTORS. When was the last time you heard anyone talk about business fundamentals as their basis for investing in a specific company? Those days are long gone.

BUT.......long term......that is STILL the name of the game. Not for most people......but for the few......that STILL have some semblance of investing knowledge and recognition of reality. The OLD STUFF.......fortunately for those few that understand business.......and.....unfortunately for the majority that dont.......is still what matters LONG TERM. Pick GREAT companies to invest in and......bingo......make GREAT profits.

Today is the perfect example of a NOTHING day in the modern markets where you see stock of......great companies.....getting hammered for no reason. You cant fight against it......you just have to accept it......as the new reality of being an investor. LONG TERM.....it is all good.....short to medium term........ it is all a big mess.

It takes GUTS to go against the grain and NOT be a trader or speculator. BUT.....over time YOU will come out ahead of all your friends and family members that dont live in the real world. It is so simple.....buy the BEST companies in the world......American BIG CAP COMPANIES.....and for as long as they exercise and execute the business model and style that made them great.......go along for the ride.

The hard part......knowing when to cut a company lose and move on. It is usually pretty obvious in hind sight.......it is when management deviates from what made the company great to begin with and gets all caught up in BS and EGO. It is when the CEO becomes the center of attention....rather than running the business and serving the two groups that are the TRUE basis of the company.......the customers and the long term shareholders.

 

HERE is the perfect example of the......."MEDIA".....turning GREAT NEWS into bad news.

Tesla denies report of China production cut as deliveries hit new monthly record

https://finance.yahoo.com/news/tesl...iveries-hit-new-monthly-record-161317345.html

(BOLD is the GREAT NEWS.........the rest about cuts, etc, is the media OPINION)

"For Tesla (TSLA) in China, there's a bit of good news and some potential bad news.

According to Tesla China through news agency Xinhua, the automaker delivered 100,291 EVs from its Giga Shanghai factory in November — an all-time record and the first time it's topped 100,000 deliveries.

The figure represents a 40% rise month-over-month from October and a nearly 90% increase from a year ago. This follows month-by-month increases at Giga Shanghai after Tesla performed upgrades at the factory increase to production.

However, it seems the upgrades may have been too productive, at least in the short term for Tesla. Reports from both Bloomberg and Reuters suggest Tesla will now cut production at Giga Shanghai, a possible sign demand is falling in the region.

Tesla is said to make cuts in production as early as this week, with reductions estimated at around 20% from full capacity. Giga Shanghai was running at full capacity in both October and November.

Bloomberg reports the decision to cut production was made “after the automaker evaluated its near-term performance in the domestic market, one of the people said, adding that there’s flexibility to increase output if demand increases.”

Tesla is denying the reports of a production cut in Shanghai, however. In a statement to Reuters, Tesla said media reports claiming Giga Shanghai would cut December output were "untrue."

That being said, any potential cuts in production come after the automaker decreased prices for its cars in China earlier in October and also increased insurance incentives in order to boost supply.

In addition, competition is heating up in China’s EV market, the world’s largest. BYD, backed by Warren Buffett, posted nearly 230K deliveries last month, with nearly 114K EVs and 116K hybrids.

From a pure output point of view, Gigafactory Shanghai is extremely productive, delivering more than 650,000 vehicles so far this year easily topping last year's total of 484,130, according to the China Passenger Car Association (CPCA). The CPCA said Giga Shanghai's annual sales could possibly hit 750K units in 2022.

Even if Tesla cuts production by 20%, the factory would be producing around 80K units a month, meaning it could theoretically reach nearly 1 million vehicles produced, making it the most productive EV factory in the world."

MY COMMENT

Sounds like GREAT news and a great future projection to me. BUT.......the media is after ELON right now.....so there is no good news in the pipeline for TESLA.

A perfect example of the TRUTH being ignored for the drama of speculation and media opinion. We all know.....the TRUTH.....especially in business, is rarely a SEXY media topic.

So......as usual.....the default mode for any good, long term, investor is........IGNORE AND HOLD ON.

 

DANG......I lost the account gain that I got last week in ONE DAY. BUT.....I am still way off my low of the year that I hit about four times.....before bouncing back up.

I am also seeing a nice little trend for me lately. On the days that the markets are down BIG like today......I am mostly sticking with the SP500. Earlier in the year when there would be a big down day......I would be much worse than the SP500. Perhaps this is telling me that the BIG CAP TECH and other stocks that I have in my account are done with the outsized losses and are just mirroring the general market averages.

In any event......I had a perfect day today......every stock down. I got beat by the SP500 by 0.03%.

 

I am going to......BEAT A DEAD HORSE. No I dont care about the politics of this. I find it very important for two reasons. First....this stuff was part of the IDIOTIC two year shut down of the economy......at least the small business economy since EVERY big business somehow managed to NOT have to close down. Second.......this stuff shows the FOOLISH TRUST that people have in government and government bureaucrats. As a LIBERTARIAN.......I say......anyone that believes the government (either party to be fair)........on any important issue is a FOOL.

AND.....for those that want to drag in politics to discredit this sort of article......here is the background of the writer:

Nicholas Wade was science editor of the New York Times from 1990 to 1996 and is author of three books on recent human evolution: Before the Dawn, The Faith Instinct, and A Troublesome Inheritance.

Proximal Orchestrations
Newly released emails cast more doubt than ever on the official story of Covid-19 as a naturally occurring virus.

https://www.city-journal.org/emails-cast-more-doubt-on-the-official-covid-story

(BOLD is my opinion OR what I consider important content)

The scientists who assured the world that the Covid-19 virus could not have been engineered in a laboratory based their pivotal decision on a single piece of flawed evidence. Their discussion of the scientific facts was interspersed with frequent speculation about the public impact of their findings. Theirs was no open minded search for the truth; one scientist expressed his determination from the start to disprove the possibility of a lab leak. In the rush to publish their predetermined conclusion, they ignored a critical viral feature that points to manipulation.

These departures from customary scientific procedure are evident from a new batch of emails released to Jimmy Tobias, a freelance writer, after litigation to block the National Institutes of Health (NIH) from making extensive redactions. The emails were exchanged principally between Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases (NIAID), a branch of the NIH, and Jeremy Farrar, director of the Wellcome Trust, a large medical research foundation in London. Other participants were Francis Collins, then director of the NIH, Patrick Vallance, Chief Scientist to the British government, and two groups of virologists, one largely U.S.-based and the other from Europe.

The new emails date from the first nine days of February 2020. They record the participants’ discussions of how to frame a report discrediting the idea that the Covid virus, SARS-CoV2, could have escaped from a lab. Just such a proposal had been outlined by the American virologists in a January 31 email to Fauci. Strangely, two of the American group soon began to lead the charge against their own proposal. Their efforts led to preparation of an article, overseen by Farrar, Fauci, and Collins, in which the American virologists reversed themselves entirely, declaring it impossible that the virus could have been engineered. The article, known as the Proximal Origins paper, was posted in near-final form as soon as February 17. It was published in the journal Nature Medicine on March 17, 2020, and proved widely influential in promoting the view that SARS-CoV2 had evolved naturally.

The emails begin with vigorous statements by the American virologists explaining their initial view that the virus had indeed been concocted in a laboratory. Mike Farzan of Scripps said that he was “bothered by the furin site” and had “a hard time explaining that as an event outside the lab.” The SARS-CoV2 genome, some 30,000 nucleotide units in length, contains a 12-nucleotide insert, known as a furin cleavage site, which greatly enhances its infectivity. Closely related viruses frequently exchange genetic material, so it would be easy to see SARS-CoV2’s furin cleavage site as having a natural origin if any other viruses in its group possessed one. But none does. Hence Farzan’s perplexity and his inference that the furin site must have been engineered into the virus.

The same point worried Bob Garry, a virologist at Tulane University. “I really can’t think of a plausible natural scenario . . . where you insert exactly 4 amino acids 12 nucleotides . . . I just can’t figure out how this gets accomplished in nature,” he wrote.

But the European virologists present on a February 1 teleconference convened by Farrar were dismissive of the lab-leak hypothesis, as if they had been invited to rebut the foolish presumptions of their American colleagues. They included Christian Drosten of Germany and Ron Fouchier, a Dutch virologist who raised alarms in 2011, when he created an air-transmissible strain of a killer flu virus, funded by the NIAID. Both virologists argued strongly that a natural origin of the Covid virus was more likely. Collins in one email complained to Farrar that “the arguments from Ron Fouchier and Christian Drosten are presented with more forcefulness than necessary,” though he was nonetheless coming around to their view.

The most surprising interventions in the discussion came from the other two members of the group, besides Farzan and Garry, who had warned Fauci of the virus’s artificial nature—Kristian Andersen of Scripps and Edward Holmes of the University of Sydney. Almost overnight, their view shifted from concluding the virus was manufactured to arguing that this could not possibly be the case. On February 8, Andersen told the others that “Our main work over the last couple of weeks has been focused on trying to disprove any type of lab theory.” So much for any open-minded inquiry into the virus’s origins.

Andersen went on to complain that so far, the scientific evidence wasn’t conclusive enough to say whether the virus acquired its distinctive features through natural selection—whether in humans or an intermediary animal host—or by serial passage, but that he was “very hopeful that the viruses from pangolins will help provide the missing pieces.” Serial passage refers to a laboratory manipulation in which a virus is forced to adapt to new conditions by continually passing it from one medium, whether a cell culture or lab animal, to another.

Holmes, too, argued against the lab-leak thesis, so much so that Collins said the possibility of serial passage should still be kept in mind. “I’d be interested in the proposal of accidental lab passage in animals (which ones?),” he wrote on February 4 to Farrar and Fauci. He doubtless meant that the virus could have been put in serial passage between animals and then escaped in some accident.

“?? Serial passage in ACE-2 transgenic mice,” Fauci replied. Fauci was suggesting that SARS-CoV2 could have acquired its surprisingly strong affinity for the ACE2 protein that studs the surface of human lung cells if it had been grown in mice genetically engineered to carry this human protein on their lung cells. Such mice stand in for human volunteers in testing whether a genetically engineered virus can infect people. The Wuhan Institute of Virology possessed a colony of ACE2-carrying mice.

“Exactly!” Farrar replied to Fauci’s suggestion.

Collins clearly found it astonishing that such a dangerous experiment would be done in low safety conditions.

“Surely that wouldn’t be done in a BSL-2 lab?” he asked Farrar.

“Wild West . . . ,” was Farrar’s response.

The Wuhan researchers did indeed manipulate viruses and cell cultures in BSL-2 labs, the second-lowest of the four designated safety levels, and hardly more stringent than the conditions in a dentist’s office. For infecting transgenic mice with engineered viruses, they used BSL-3 conditions, which are substantially safer, though insufficient to have prevented four escapes of the SARS1 virus from a lab in Beijing in 2004.

Fauci by this time knew that his agency was funding the Wuhan Institute of Virology to manipulate coronaviruses. It is unclear how much of this he had told Collins. A possible interpretation of the emails is that they reflect a process stage-managed by Farrar and Fauci to accomplish two ends. One was to supply evidence to explain why the American virologists were recanting their initial conclusion about SARS-CoV2 being lab-made. The other was to persuade the two senior officials, Collins and Vallance, that there was nothing to see here, just a little misunderstanding that could safely be put to rest.

What single piece of evidence could best support the idea that SARS-CoV2 had moved naturally from bats to an intermediary animal host and then to people just as did its predecessor, the SARS1 virus that caused the 2002 epidemic? Obviously, a coronavirus that was currently infecting some animal population and possessed a genome sequence extremely similar to that of SARS-CoV2. A virus that differed by less than 1 percent would be a plausible ancestor, strongly implying that SARS-CoV2 had emerged from nature. And Farrar had just such a surprise to pull out of his hat at the right moment.

“Reports coming out overnight that Chinese group have pangolin viruses that are 99% similar,” Farrar emailed the others on February 7. “This would be a crucially important finding and if true could be the ‘missing link’ and explain a natural evolutionary link,” he explained. It would indeed. If true.

It wasn’t. But Collins and Vallance lapped up the exciting news. “Has the actual sequence of the pangolin coronavirus isolate been released?” Collins replied, the same day. “That will be VERY interesting. Does it have the furin cleavage site?”

The next day Vallance, the U.K.’s chief scientist, replied with advice “to make sure that the sequence data from the pangolins is included” in the paper under preparation.

Both Farrar and Holmes have close connections with Chinese health officials. Could they have asked their Chinese colleagues for any data helpful to the cause? Whether or not there was any such coordination, the Chinese needed no encouragement to help discredit the idea of lab leak.

“The strain isolated from pangolin is 99% similar to the new coronavirus strain,” a perfectly timed press release from the South China Agriculture University reported on February 7, just as Farrar had predicted.

The pangolin data were highly uncertain and preliminary. But why subject it to zealous scrutiny when it supported the conclusion everyone now wanted? “Personally, with the pangolin virus possessing 6/6 key items in the receptor binding domain, I am in favour of the natural evolution theory,” Holmes wrote in an email of February 8.

On that basis, further discussion seemed unnecessary. The draft of the Proximal Origins paper was wrapped up and posted online ten days later. The colossal embarrassment of discovering that Chinese researchers funded by the NIAID had unleashed the deadly Covid epidemic on the world was averted. What was not to like?

Nothing except that the pangolin data that had driven the whole process were a gigantic red herring. Far from being 99 percent similar to SARS-CoV2, the coronavirus found in pangolins was in fact even less similar than RaTG13, a coronavirus sequence the Chinese had already published. The virus contained no furin cleavage site, so had no relevance to the principal anomaly in the SARS-CoV2 sequence. The pangolin data were not new, as Farrar had implied to Collins and Vallance, but had been made available on the website virological.org on January 23. And for all the weight placed on them by the email participants, the pangolin data had many inconsistencies. One of the preprints based on them was never published in a journal. The other was posted by the Chinese on February 20, only after the text of Proximal Origins was in near-final form. This was the unverified data used to dismiss the quite substantial evidence already available in favor of the lab-leak hypothesis. And all the email participants just went along with it.

As for the Proximal Origins paper, it was submitted to Nature, which rejected it, apparently for the hilarious reason that the European virologists were not given sufficient credit for their part in disabusing the American virologists of their belief in the lab-leak thesis. The manuscript was then passed down to Nature Medicine, a subsidiary journal.

One other point is worth noting before addressing the central mystery of the new emails. Inside the anomaly of the furin cleavage site is another puzzle, also highly indicative of an engineered virus. The genetic code is universal but also loose enough to allow for spelling preferences that differ from one organism to another. So coronaviruses prefer one set of spellings and humans another. Six of the 12 nucleotides in the furin cleavage site, the sequence CGG-CGG, represent the human-preferred spelling. Indeed, this sequence, when in correct frame, is unknown in coronaviruses, raising the clear possibility that it came from a lab kit, not from nature.

Strangely, this salient point is not even discussed in the emails or the Proximal Origins paper. Could Andersen and Holmes, both expert virologists, really have failed to notice it? Perhaps, because by February 4 Andersen was already calling the lab leak a “crackpot” theory, and as early as February 2 he may have been focused on disproving the lab-leak hypothesis, as he states in the emails, not on looking for pertinent evidence.

This brings us to the over-riding puzzle of the email record. What exactly happened on February 1 to make Andersen and Holmes change their minds 180 degrees? It was not scientific evidence, because no new evidence is cited in the emails on that date. So it’s reasonable to consider other possible sources of persuasion.

Go back to the January 31st email in which Andersen tells Fauci that if you “look really closely at all the sequences” of SARS2 and related bat viruses, you can see “that some of the features (potentially) look engineered.” Hence, he wrote, he and his three colleagues, Holmes, Farzan, and Garry, “all find the genome inconsistent with expectations from evolutionary theory,” meaning it wasn’t made in nature.

This would be a stunning discovery, if true, and one that its authors doubtless intended to publish as soon as possible, even though it would trigger a political maelstrom. Andersen surely expected praise for this sensational insight and that Fauci would give helpful advice about presenting the discovery to the public.

But would the NIH leadership indeed have been overjoyed to see the mother of all public inquiries into the possibility of a link between its support of research at Wuhan and the outbreak of the pandemic? Quick action would be needed to avert any such disaster. Instead of appreciation, Andersen finds himself the very next day on a teleconference with Fauci, Collins, and senior British medical officials, being confronted by a bunch of European gain-of-function virologists baying for his blood. To Andersen’s dismay, it seems that Fauci is not so pleased. Collins, too, is seriously unhappy, fretting in an email the next day that “the voices of conspiracy will quickly dominate, doing great potential harm to science and international harmony.”

Evidently, Andersen has gotten the wrong answer. Right scientifically, maybe, but oh, so erroneous politically.

Being wrong was no trivial matter for Andersen’s group. Fauci, Collins, and Farrar between them control a huge chunk of the money available for virology research. What serious prospects could there be for Andersen’s future career if he should persist, despite heavy hints, in doing “great potential harm to science and international harmony?” As to the likelihood of NIH delight in his group’s landmark discovery that SARS-CoV2 bore the fingerprints of human design, the scales that day fell from his eyes.

“I see that road to Damascus conversion occurring during the February 1 teleconference,” Richard Ebright, a molecular biologist at Rutgers University who has long criticized gain-of-function virology research, said in an interview. “They felt they had found something really important and their funding agency would be proud of it too, but on the teleconference they learned the opposite. They felt Fauci would really want to know, but it’s the last thing he wanted to know.”

Telling the truth had landed them in deep ordure. “They were so concerned they had damaged their fundability that the only way they could retrieve it was to suborn science on behalf of their paymaster,” Ebright avers.

The Proximal Origins paper was the recantation of the dangerous conclusion they had outlined in their January 31st email. Only when this palinode is safely in press does Andersen receive the praise he had at first expected, though for the opposite reason. “Nice job on the paper,” Fauci writes him on March 8. And what a pleasant surprise: on May 21, Andersen’s lab, with Garry as a subcontractor, was awarded a grant of almost $1.9 million from Fauci’s agency.

“Our analyses clearly show,” wrote the authors of Proximal Origins, “that SARS-CoV-2 is not a laboratory construct or a purposefully manipulated virus.” For the following two years, this aggressively stated conclusion in a high-visibility journal became accepted wisdom throughout the world. The new emails give no reason for confidence that its authors believed a word of it."

MY COMMENT

One thing is clear......this issue is not settled or proven. We will probably NEVER know the truth at this point. Perhaps some time in history it will be clear but not for many years.

Dont even get me started on how and why the......"vaccines"......dont seem to work and contrary to any other vaccine in our lives we need to take this one every 2-6 months.

Unfortunately we are now seeing the same sort of nonsense in science, medicine, and all other aspects of society that we see every day in the now TABLOID MEDIA.

Do I care.......well no. I am always proactive in terms of medicine and science. I dont really accept or believe anything unless I can verify it based on actual research. Fortunately......as a result of a former life.....I am a pretty good medical literature researcher.

I did actually find this article on a.....financial site.

Same as the investing world......TRUST NOTHING and NO ONE.

 

The hind-sight markets today.

S&P 500, Nasdaq post worst day in month after strong data fuels worry about Fed rate hikes

https://finance.yahoo.com/m/098bf459-5776-39cc-ba9a-e83ff2325e77/s-p-500-nasdaq-post-worst.html

and

Stocks smoked as oil, tech stocks lead markets lower

https://finance.yahoo.com/news/stock-market-news-live-updates-december-5-125408828.html

 

My current view is that we have now seen the end of the recession. Whether we will see another one in 2023 is up in the air with the FED being constantly undercut by the government on their happy spending and stimulus spree.

At this point I dont see recession as much of an issue. The big issue is how long does the FED continue to raise rates and how long they hold them high. My guess........1-2 years of continued inflation and little to no impact from the impotent actions of the FED.....in the face to other government actions.

Does this mean stocks will not go up......NOPE. The markets are NOT the economy and sooner or later investors are simply......not going to give a damn.

 

Here is another company to add to the list of job cuts. I say BRAVO.....the perfect way to drive up business productivity.

PepsiCo plans to cut hundreds of corporate jobs, report says

https://www.cnbc.com/2022/12/05/pepsico-plans-to-cut-hundreds-of-jobs.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• PepsiCo is eliminating hundreds of corporate jobs in North America, according to the Wall Street Journal.
• The company’s beverage unit is expected to be hit harder by the cuts, according to the Journal.
• In November, Coca-Cola said it would restructure its North American business through a voluntary separation program that included buyouts.

PepsiCo is eliminating hundreds of corporate jobs in North America, according to the Wall Street Journal.

The layoffs will affect employees of its food and beverage businesses in Chicago; Plano, Texas and Purchase, New York, the Journal reported, citing people familiar with the matter and a company memo. PepsiCo’s portfolio includes Gatorade drinks, Frito-Lay snacks and Quaker Oats foods.

The company’s beverage unit is expected to be hit harder by the cuts because the snacks unit already shrank its workforce through a voluntary retirement program, according to the Journal.

The company did not immediately respond to a request for comment from CNBC.

Pepsi employed 309,000 people worldwide as of Dec. 25, with more than 40% of those jobs located in the U.S., according to a company regulatory filing.

In October, PepsiCo hiked its full-year revenue forecast after higher prices boosted its sales. However, some of its business units, including Frito-Lay North America, reported shrinking volume, a sign that consumers were cutting back their snacking to better manage their budgets.

In recent months, companies in the tech and media sectors have been laying off workers to trim costs as economic uncertainty pressures their businesses. Several food and beverage companies have also cut jobs, including Beyond Meat, Impossible Foods and PepsiCo’s main rival Coca-Cola. In November, Coke said it would restructure its North American business through a voluntary separation program that included buyouts."

MY COMMENT

Wave bye-bye to those good paying corporate jobs. Once they are gone they will NOT come back. People are being pushed out of high paying jobs into lower paying service jobs. Fortunately the retirement of the baby boomers might help people to be able to keep a good job.

Since this news release emphasizes that the jobs are "North American jobs"......I will read between the lines that many of these jobs will end up being done by foreign contract workers.

 

Well Zukodany......it depends on what you are calling......."going against the grain". He is certainly going against what the media is pushing. BUT....is he in fact actually going with what the majority of Americans would say or agree with if it was them? I suspect that if you polled everyone at least 60-70% would agree with him and NOT the media line.

At least that is my........hope.

 

As usual......for the benefit of any new readers.

I have no plans to sell anything or do anything. As a long term....fully invested all the time investor......I will do nothing in response to the current short term events and environment.

AS USUAL.........HERE is my current PORTFOLIO MODEL.

I am once again posting my PORTFOLIO MODEL. My initial criteria to start the process to consider a business are.......BIG CAP, AMERICAN, DIVIDEND PAYING, GREAT MANAGEMENT, ICONIC PRODUCT, WORLD WIDE LEADER IN THEIR FIELD, LONG TERM HORIZON, etc, etc, etc.

PORTFOLIO MODEL

"Here is my "PORTFOLIO MODEL" for all accounts managed which is the basis for MUCH of my discussion in this thread. I am re-posting this since I often talk in this thread about my portfolio model. My custom in the past on this sort of thread was to re-post my portfolio model every once in a while since I will tend to talk about it once in a while. I "manage" six portfolios for various family including a trust. ALL are set up in this fashion. If I was starting this portfolio today, lets say with $200,000. I would put half the money into the stock side of the portfolio, with an equal amount going into each stock. The other half of the money would go into the fund side of the portfolio, with an equal amount going into each fund. As is my long time custom, I would than let the portfolio run as it wished with NO re-balancing, in other words, I would let the winners run. Over the LONG TERM of investing in this style (at least in my actual portfolios), the stock side seems to reach and settle in at about 59% of the total portfolio and the fund side at about 41% of the total portfolio over time. That is a GOOD THING since it tells me that my stock picks are generally beating the funds over the longer term. AND....since the funds in the account generally meet or beat the SP500, that is a VERY good thing.

As mentioned in a post in this thread, I include the funds in the portfolio as a counter-balance to my investing BIAS and stock picking BIAS and to add a top active management fund that often beats the SP500 (Fidelity Contra Fund) and a SP500 Index Fund to get broad exposure to the best 500 companies in AMERICAN business and economy. The funds also give me broad diversification as a counter-balance to my very concentrated 10 stock portfolio. At the same time the funds double and triple up on my individual stock holdings............that I consider the BEST individual businesses in the WORLD.

STOCKS:

Alphabet Inc
Amazon
Apple
Costco
Home Depot
Honeywell
Microsoft
Nike
Nvidia
Tesla

MUTUAL FUNDS:

SP500 Index Fund
Fidelity Contra Fund

CAUTION: This is a moderate aggressive to aggressive portfolio on the stock side with the small concentration of stocks and the mix of stocks that I hold and with the concentration of big name tech stocks. Especially for my age group. (72). So for anyone considering this sort of portfolio, be careful and consider your risk tolerance and where you are in your life and financial needs. I am able to do this sort of portfolio since my stock market account is NOT needed for my retirement income AND I have a fairly HIGH RISK TOLERANCE. In addition I am a fully invested, all the time, LONG TERM investor. (LONG TERM meaning many years, 5, 10, 20, years or more)"

MY COMMENT

This portfolio is HIGHLY CONCENTRATED on the big cap side of things. OBVIOUSLY between the funds and my ten stock holdings there is MUCH doubling and tripling up on the stocks. THAT is INTENTIONAL. I strongly subscribe to the view of Buffett and some others that TOO MUCH diversification kills returns. I do NOT believe in the current diversification FAD that most people seem to now follow.......or think they are following. I DO NOT do bonds and think the current level of bonds held by younger investors.....those under age 50.....is extremely foolish.I DO NOT do market timing or Technical Analysis.

#13075

 

Nothing interesting in the markets today.......so.....here is a little article with some good content for long term investing.

Weekly Market Pulse: Follow The Delphic Maxims

https://alhambrapartners.com/2022/12/04/weekly-market-pulse-follow-the-delphic-maxims/

(BOLD is my opinion OR what I consider important content)

"Know Thyself is the first of three Delphic maxims that were inscribed at the Temple at Delphi. The aphorism is most often associated with Socrates who, according to Plato’s dialogues, said, among many other wise things, “to know thyself is the beginning of wisdom”. But it was only the first of the three maxims and an investor needs to know all three. “Nothing to excess” and “certainty brings insanity” are the other two and are just as important as the one everyone remembers.

An investor must know him or herself because we humans are full of biases that affect our decision-making process. Some people will interpret every bit of news in a negative light while others see the silver lining in every dark cloud. I have been accused of the latter at times and I take that criticism seriously. It is hard to “know thyself” and I try to guard against my optimistic bias whenever I make decisions. But I am far from perfect so I just assume that there is a decent chance I’ll be wrong about any decision I make.

That doesn’t mean I don’t act on my views; it just means that I endeavor to quickly correct any mistake I do make. I learned a long time ago that in investing, slugging percentage is much more important than batting average. You can be wrong a lot – even more than half the time – and still make a good return if you make a lot when you are right and lose a little when you are wrong.

An investor also needs to be careful to do “nothing to excess”. I have written about this before, referring to how some investors think investing is an all-or-nothing exercise. If they believe something is going to happen – recession, inflation, dollar devaluation – they want to invest all or a substantial portion of their assets to benefit from their “vision”. I have said many times, that we don’t practice this “all or nothing” investing and if you expect us, for instance, to sell all our stocks and buy long-term Treasuries because the yield curve has inverted, you’re going to be disappointed. Humility is, by far, the most important character trait of a good investor.

“Nothing to excess” leads to the third maxim; “certainty leads to insanity”. One thing I am absolutely certain about when it comes to investing is that there are no certainties. Things that have never happened before happen all the time in markets and things that have always worked in the past often just stop working for seemingly no reason. Although, usually the reason is that everyone is doing the thing that has always worked rendering it no longer valid. My favorite example of this is the Dogs of the Dow, which worked for years – until everyone started using it in the 90s – and started working again after everyone abandoned it. Wall Street is really good at doing things to excess.

A good investor knows his own biases (know thyself), diversifies his portfolio (nothing to excess), and readily and quickly admits his mistakes (certainty leads to insanity). The first and third things are hard but the second one is completely in your control and pretty easy. Diversification is the only free lunch on Wall Street and millions of investors ignore it in favor of fancy, expensive dinners hosted by false oracles who tempt them with certainty.

I write about these pearls of wisdom today because I think we need them more today than ever before. Investors have convinced themselves that there is certainty today about the economy, that today’s conditions are so obvious that they warrant an extreme position. That one thing is, obviously, recession. The yield curves have inverted and therefore recession is inevitable, unavoidable. Because of this, they are doing the easy thing, sitting in cash – and at least getting paid for a change from the last decade – and waiting for the all-clear.

I am again reminded of the Keynesian beauty contest view of the markets. I’ve written about this before but to remind you of the concept here’s the Wikipedia entry:

Keynes described the action of rational agents in a market using an analogy based on a fictional newspaper contest, in which entrants are asked to choose the six most attractive faces from a hundred photographs. Those who picked the most popular faces are then eligible for a prize.

A naïve strategy would be to choose the face that, in the opinion of the entrant, is the most handsome. A more sophisticated contest entrant, wishing to maximize the chances of winning a prize, would think about what the majority perception of attractiveness is, and then make a selection based on some inference from their knowledge of public perceptions. This can be carried one step further to take into account the fact that other entrants would each have their own opinion of what public perceptions are. Thus the strategy can be extended to the next order and the next and so on, at each level attempting to predict the eventual outcome of the process based on the reasoning of other rational agents.

“It is not a case of choosing those [faces] that, to the best of one’s judgment, are really the prettiest, nor even those that average opinion genuinely thinks the prettiest. We have reached the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees.” (Keynes, General Theory of Employment, Interest and Money, 1936).

Today, everyone knows the yield curve is inverted and that recession always follows yield curve inversions. Those investors who have convinced themselves that recession is inevitable have taken actions to protect themselves from what they know is coming. They’ve sold stocks and bought long-term bonds because in recessions, stocks fall and bonds rise.

The question is whether by doing so, they have created the very condition that causes them to fear recession. In fact, many of them anticipated the yield curve inversion – they could see it flattening – and took action well in advance of the actual event. But in doing so, did they cause the yield curve inversion they feared? The persistent inflow of capital to long-term government bond funds could certainly be interpreted that way. In addition, by selling early and pushing the stock market into a bear market, they may have influenced other investors to follow their lead. And as the yield curves continue to invert across more and more maturities, investors who haven’t acted yet feel an urgency to join the crowd in anticipating the recession that has defied the bears’ predictions by refusing to arrive.

If that is true – and I’m not certain it is – then who are the people buying stocks over the last two months? Those are the second-degree thinkers in Keynes beauty contest. The second-degree thinkers believe that if everyone believes recession is coming and they’ve already acted on that belief, there is no one left to sell and the market can – and has – found a bottom. So they have been buying despite their own knowledge of yield curve inversions.

Then there are the third-degree thinkers. They were quietly buying over the summer, acting with the second-degree thinkers but they’ve stopped now. Why? Because they know that a lot of people know what the second-degree thinkers know and have acted on it already – they’ve bought stocks. The third-degree thinker believes the second-degree thinkers have nearly exhausted their buying power and that it is prudent to wait for more information. The third degree is uncertain about the economic outlook, trying to guard against excessive optimism, not making any big bets, and is still holding some cash. We are the third degree."

MY COMMENT

Some of the above I do not agree with.....but......the simple basic concepts in this little article are critical to good investing results. One SURE WAY to avoid all the issues that kill returns is simple long term investing. Of course, that assumes that realistic and rational stocks and funds are owned.

 

Here is the markets.....so far....today. NOPE.....not anywhere near a Santa rally.

Stocks flat after Monday's market rout

https://finance.yahoo.com/news/stoc...flat-after-mondays-market-rout-143438066.html

(BOLD is my opinion OR what I consider important content)

"U.S. stocks were little changed Tuesday morning as Wall Street continued a sluggish start to the week, as investors digest new readings on October's trade balance and await results from the Georgia Senate runoff election.

The S&P 500 (^GSPC), the Dow Jones Industrial Average (^DJI) and the technology-heavy Nasdaq Composite (^IXIC) were unchanged in early market trading.

Wall Street looked to recover from a rout on Monday, as stocks sunk while investors digested the first releases in a week full of economic data. The S&P is set for its sixth down day in the last seven trading sessions, according to Bespoke Investment Group. Data readings pointing to continued resilience in different pockets of the economy have prompted intense market fixation around the risk that the Federal Reserve will continue to raise interest rates throughout the next year.

Fed officials, including Chair Jerome Powell, have largely suggested the central bank will downshift to a half-point move at their meeting next week after four consecutive 75 basis-point increases. But the employment report on Friday showed strong job gains and robust wage growth, the opposite of what the Federal Reserve would like to see in its battle against inflation.

A smaller increase would indicate a new phase for the central bank’s tightening campaign, but elevated wage pressures could lead to more officials raising their benchmark federal funds above 5% next year, which is currently anticipated by Wall Street.

“In light of the various releases, expectations of the Fed terminal rate priced for May 2023 moved up by 9.5 basis points on the day to 5.01%, crossing the 5% threshold again,” Jim Reid and colleagues at Deutsche Bank wrote in an early morning note Tuesday.

“That’s a noticeable shift from where it was just before Friday’s jobs report, when it hit a low of 4.83%, and means that most of the moves lower after Chair Powell’s Wednesday speech have now reversed,” he added.

Officials will get another read on inflation on December 13, the first day of the Fed's two-day policy meeting, when the Labor Department releases the Consumer Price Index for November.

December has gotten off to a rockier start in the markets as investors “unwind of consensus macro positions this year, which has ensued since the cool CPI print mid-November,” according to Mike Gormley, Equity Institutional Sales at JPMorgan.

In commodity markets, oil prices continued to trade lower Tuesday, with crude futures at $75.83 per barrel. Oil's recent tumble has come even amid recent moves by OPEC and its Russian-led allies to stay the course on production cuts and as China officials have tentatively eased COVID restrictions that have eroded consumption from the world’s largest importer.

In bond markets, the yield on the U.S. 10-year Treasury note edged higher at 3.57% on Tuesday. The dollar also ticked down slightly.

In corporate news, PepsiCo (PEP) plans to eliminate hundreds of jobs at the headquarters of its North American snacks and beverages divisions, The Wall Street Journal reported. The move follows other companies, including Walmart and Ford, that have trimmed jobs of white-collar workers amid economic uncertainty.

Separately, GitLab (GTLB) shares rose nearly 12% after the company posted third-quarter earnings that beat Wall Street expectations and raised forecast revenue in 2023.

And on the politics front, Georgia voters are casting ballots Tuesday in another runoff race that will determine if Democratic Sen. Raphael Warnock can stiff-arm Republican challenger Herschel Walker. Though Democrats have already clinched control of the Senate, both parties have poured heavy resources into the race.

“Senate seats only come up every 6 years with just a third of the chamber elected each time, a victory for either side would make it easier for them to gain control in the 2024 and 2026 elections as well, since that Georgia seat wouldn’t be up for election again until 2028,” Reid and colleagues at Deutsche Bank wrote in a note.

Meanwhile, President Joe Biden will visit TSMC's Arizona plant on Tuesday as the Taiwanese chipmaker said it would triple its planned investments there to $40 billion. Joining Biden in his visit will be Apple CEO Tim Cook, TSMC founder Morris Chang, the head of chipmaker Micron Technology Inc. Sanjay Mehrotra, and NVIDIA founder and CEO Jensen Huang, and among others, the White House said."

MY COMMENT

LOL......this is how ridiculous the markets have now become......at least if the info in this little article is true. So....supposedly today the markets are down due to the Georgia election and readings on Octobers Trade Balance.

Give me a break......I dont think you could find one investor in a million that knows or cares anything about the October Trade Balance readings.......I know I dont.

In reality it is just the same old, same old, market day. We are caught up in a GROUNDHOG DAY market year. Nothing matters if it is good news. The markets are just looking to be negative and that is what the DEFAULT is at the moment.

Yes.....somewhere out there in the future there is a BULL MARKET waiting to happen. It is just a matter of time. One day we will move on and this little time will be forgotten.

 

I dont see a single word in the financial media about the Christmas shopping season. That REALLY is the issue that is the most critical for business at the moment.......right? I also dont see a word in the media sources that i scan about the real estate markets.....the second most important issue at the moment.

I have not been out there shopping so I have no idea how it is going on a local level. I do know that our neighborhood EXPLODED with Christmas decorations in the yards right after Thanksgiving. Way more than normal and way earlier than normal. At least here in my local area people are going all out for the Holiday this year

 

You just have to love the IRS.

IRS warns Americans over $600 threshold to report Venmo, PayPal payments

https://nypost.com/2022/11/25/irs-w...00-threshold-to-report-venmo-paypal-payments/

(BOLD is my opinion OR what I consider important content)

"The Internal Revenue Service is reminding tax filers to prepare to report transactions of at least $600 that are made through so-called “third-party” facilitators such as Venmo and PayPal.

The agency on Tuesday posted an explainer warning American business owners earning $600 or more per year on payments that are received through apps such as Cash App, Venmo, and PayPal that they will receive a tax form known as Form 1099-K.

The IRS is interested in obtaining data pertaining to transactions involving part-time work, side gigs, and selling goods, according to the agency.

The rule does not apply to noncommercial payments like reimbursing someone for food or rent or other one-off transactions such as selling an old piece of furniture, according to accountants.

Before this year, the threshold for filing a Form 1099-K report was at least 200 transactions totaling an aggregate of at least $20,000.

When Congress passed the American Rescue Plan Act of 2021, it included a provision that reduced the reporting threshold to a single transaction over $600.

The Biden administration hopes that by reducing the threshold, the measure will crack down on Americans evading taxes by not reporting the full extent of their gross income.

The proposal was offered as a way to help pay for a $3.5 trillion social spending bill that would invest in climate programs, child care and education.

Tommy Lucas, an Orlando, Fla.-based certified financial planner, told CNBC that filers must include any sum that is reported on Form 1099-K as part of their business income.

Failure to do so could trigger an audit since the IRS obtains a copy of Form 1099-K directly from the third-party payment facilitator."

But the provision has been met with pushback from sites like Etsy and eBay, who joined with smaller retailers to create the “Coalition for 1099-K Fairness,” which they say is aimed at protecting “casual online sellers and microbusinesses from unfair tax and privacy burdens.”

Earlier this year, President Joe Biden signed into law the Inflation Reduction Act, which includes a provision that will lead to the hiring of 87,000 additional IRS agents.

The nonpartisan watchdog Joint Committee on Taxation said it anticipates that between 78% and 90% of the estimated $200 billion that the IRS will collect as a result of the bolstered workforce will come from small businesses.

President Biden and the Democratic Party have insisted that Americans earning less than $400,000 annually would not have to pay a cent more in taxes.

But the Joint Committee on Taxation disputes this, saying that between 4% and 9% of the money collected will come from businesses that earn above $500,000 a year."

MY COMMENT

I really dont care on a personal level. The only 1099 that I get is for my band income and I have gotten that one for years.

This will be a big issue for many people in the cash economy.

The good news.....the IRS is totally incompetent. This will flood them with more and more data and reports which they will be totally unable to handle or process. I remember a few months ago media coverage about the IRS trashing tens of millions of business reporting forms because they could not handle all the paper work.

This will of course be a HUGE burden for small business.