The top of the financial news today.....but....does anyone care? I dont. US wholesale prices picked up in February in sign that inflation pressures remain elevated https://finance.yahoo.com/news/us-wholesale-prices-picked-february-124217277.html (BOLD is my opinion OR what I consider important content) "WASHINGTON (AP) — Wholesale prices in the United States accelerated again in February, the latest sign that inflation pressures in the economy remain elevated and might not cool in the coming months as fast as the Federal Reserve or the Biden administration would like. The Labor Department said Thursday that its producer price index — which tracks inflation before it reaches consumers — rose 0.6% from January to February, up from a 0.3% rise the previous month. Measured year over year, producer prices rose by 1.6% in February, the most since last September. The figures could present a challenge for the Fed, which is counting on cooling inflation as it considers when to cut its benchmark interest rate, now at a 23-year high. The Fed raised rates 11 times in 2022 and 2023 to fight high inflation. A rate cut by the Fed could boost the economy and financial markets because it would likely ease borrowing costs over time for mortgages, auto loans and business lending. Higher wholesale gas prices, which jumped 6.8% just from January to February, drove much of last month's increase. Wholesale grocery costs also posted a large gain, rising 1%. Yet even excluding the volatile food and energy categories, underlying inflation was still higher than expected in February. Core wholesale prices rose 0.3%, down from a 0.5% jump the previous month. Compared with a year ago, core prices climbed 2%, the same as the previous month. Core inflation, which tends to provide a better sign of where inflation may be headed, is watched particularly closely. Persistently elevated inflation could become a threat to Biden's re-election bid, which is being bedeviled by Americans' generally gloomy view of the economy. Consumer inflation has plummeted from a peak of 9.1% in 2022 to 3.2%. Yet many Americans are exasperated that average prices remain about 20% higher than they were before the pandemic erupted four years ago. Thursday’s data follows a report earlier this week on the government’s most closely watched inflation measure, the consumer price index. The CPI rose by a sharp 0.4% from January to February, a faster pace than is consistent with the Fed’s 2% inflation target. Compared with a year earlier, prices rose 3.2%, up from a 3.1% increase rise the previous month. The CPI report, which marked the second straight pickup in consumer prices, illustrated why Fed officials have signaled a cautious approach toward implementing rate cuts. After meeting in January, the officials said in a statement that they needed “greater confidence” that inflation was steadily falling to their 2% target level. Since then, several of the Fed’s policymakers have said they think inflation will keep easing. In December, the policymakers had signaled they would reduce their rate three times this year. On Wednesday, the officials will issue new quarterly projections that could either maintain or revise that forecast. Last week, Fed Chair Jerome Powell signaled to Congress that the central bank was “not far” from starting rate cuts. Most economists and Wall Street investors have said they expect the first cut to occur in June. Solid spending and hiring so far this year show that the economy has stayed healthy despite the Fed’s aggressive series of rate hikes in 2022 and 2023. Last month, employers added a solid 275,000 jobs, the government reported. And though the unemployment rose by two-tenths to a still-low 3.9%, it has remained below 4% for more than two years -- the longest such stretch since the 1960s." MY COMMENT If you DISREGARD al the slicing and dicing of this data in all the various articles....there is ONLY one bit of data that matters......at least to me: "Core wholesale prices rose 0.3%, down from a 0.5% jump the previous month. Compared with a year ago, core prices climbed 2%, the same as the previous month. Core inflation, which tends to provide a better sign of where inflation may be headed, is watched particularly closely." The REALITY......we are in a very healthy economy and inflation is right in line with historic norms. Everyday people are still feeling the CRUNCH....because of gas prices and food.....but the broad measures are perfectly in line with where they should be.
in other news… automatic gear shift euphoria is dead as well… long live STICK lol I don’t see a future with gas operating cars, and I don’t say it for political reasons, which seems to be the main bias today AGAINST electric vehicles. It’s just because of one reason - savings. we own an ev (Tesla) for 8 years now and I can tell you that between gas savings and MECHANICAL work savings (there is none. As in NONE). We’ve EASILY saved $20k It’s actually funny, because the government here in the USA DOES NOT help you with saving when you actually buy an EV like they PRETEND to say. That’s why when we pay for our EV registration they charge us almost $500 because WE DO NOT USE A GAS OPERATING VEHICLE and do not pay taxes on gas like everyone else. SUCH BULLSHIT Yeah, sometime you know what the government does by walking the walk instead of what they promise us in the media
EV is the future. No doubt. But this new hydrogen engine from Toyota is going to put all EV builders out of business. They have a very compelling PowerPoint.
I like this little article. Long-Term Recency Bias https://awealthofcommonsense.com/2024/03/long-term-recency-bias/ (BOLD is my opinion OR what I consider important content) "Market cycles operate on numerous time horizons. Short-term trends which are often impacted by momentum and emotions. Intermediate-term trends which are more impacted by some combination of flows, themes and fundamentals. And long-term trends which are impacted mainly by fundamentals. The hard part about investing is it’s difficult to know in real-time if you’re experiencing secular or cyclical markets. Strategies can remain out of favor for quite some time. Some of them stop working altogether. One of the hardest questions to answer as a diversified investor is this: Am I being disciplined by sticking to my long-term approach or am I being irrational because the world has changed for good? Cliff Asness talked about this idea in a recent interview with the Financial Times: The problem is you have no other choice; no one knows the future. So you allocate what you think is the right amount of risk to things, because the secret is the whole stock market is just as susceptible. Maybe the most interesting example is US versus non-US developed markets. Famously, the US has crushed everyone [in the past 15 years]. During the 15 years prior to that it was: why invest in the US? It tells you something that the stories can change so much. The US was cheaper than the world in 1990. Now the US is far more expensive than the world. Almost all of the US’s victory was from richening. You can argue if it’s justified, but you tend not to get a repeat — another 30-year relative tripling of the valuation ratio. I tell any US investor with some international diversification: you’re doing the right thing. It’s just the timescales these things work on. This chart from JP Morgan shows what Asness is talking about with U.S. stocks vs. international stocks: Some of these cycles have been relatively short. The most recent one was very long. The crazy thing is no one really saw this coming. It seems obvious in hindsight but coming out of the Great Financial Crisis few people were pounding the table on America. I sat through a lot of pitches on emerging markets, BRICs (China specifically) and commodities in the early 2010s. No one was predicting we would see multiple trillion dollar market cap tech companies emerge as the most dominant stocks we’ve ever seen. The reason for this is simple — performance. From 2000-2007, emerging market stocks were up well over 200% in total (15.3% per year). The Chinese stock market was up a similar amount. Commodities went nuts too just before the financial crisis kicked into high gear: A basket of commodities was up nearly 100% from 2007 through the summer of 2008. Tech stocks, on the other hand, were in the midst of a mammoth crash. The Nasdaq 100 fell more than 80% after the dot-com bubble popped: It would remain underwater for 15 years. The Nasdaq 100 has been crushing it for well over a decade now. It’s up almost 800% in total since the start of 2012. That’s annual returns of close to 20% per year. If you invested in the Qs you’ve basically been Warren Buffett for more than a decade now. But the returns before this cycle were dreadful. From the inception of the Nasdaq 100 ETF (QQQ) in early-1999 through the end of 2011, the fund was up a total of 14.3%. That’s 1% per year for 13 years. Interestingly enough, if we mash these two diametrically opposed cycles together you basically get the long-term average return of the stock market since the inception of this ETF: The current cycle has lasted for more than 10 years. The previous cycle also lasted for 10+ years. One was incredible for investors. The other was a swift kick to the private parts. Both cycles have been extreme but sometimes that just happens in the markets. You don’t get the good without the bad. Asness is right that U.S. stocks haven’t always been the darlings they are today. The Credit Suisse Global Investment Yearbook has a great chart that shows the evolution of global equity markets since the turn of the 20th century by country weights: The U.S. stock market was relatively small in 1900. By the 1950s, 1960s and 1970s we had the dominant position globally. But Japan gave us a run for our money in the 1980s. By 1990, Japan made up nearly 50% of global equity markets, while U.S. stocks were down to roughly one-third of the total. Despite the healthy bull market in the 1980s, U.S. stocks badly lagged the rest of the world for two decades. These were the total (and annual) returns from 1970-1989 for foreign developed (MSCI EAFE) and U.S. stocks (S&P 500): Foreign stocks: +1,934% (+16.3%) U.S. stocks: +790% (11.6%) In the 1990s, U.S. stocks played catch-up in a big way. In the 2000s, international stocks regained the lead. Since the start of the 2010s, U.S. stocks have sprinted ahead yet again. My point here is these cycles are normal. You can go through periods of underperformance for 10+ years and have no idea if or when your strategy will come back into favor. You can go through periods of outperformance for 10+ years and have no idea if or when your strategy will go out of favor. The problem with these types of cycles is it’s impossible to avoid recency bias because it feels as though these trends will persist indefinitely into the future. America is dominating the rest of the world right now in terms of economic and financial market performance. I’m not willing to bet against America in the long run. But Japan was dominating the rest of the world in the 1980s. China was dominating the rest of the world in the 2000s The UK was dominating the rest of the world coming into the 1900s. Maybe the U.S. stock market is just plain better. Maybe tech stocks will outperform forever. Sometimes it’s different. But I’m not willing to go all-in on that bet. I still think international diversification is a prudent form of risk management. Today’s winners will become tomorrow’s laggards at some point. I just don’t know when and I don’t know why." MY COMMENT NO......I am not going to buy Chinese companies. AND.....no.....I am not going to invest in NON-AMERICAN companies. Of course I am an "international investor". Every company that I own does business across the world and is the dominant market leader in their business across the world. If you invest in the best of the best.....in business....you will be just fine. There is no need to swing for the fences if you are a long term investor. Simply bet on the proven winners for as long as they remain the winners. You can do this through INDEX investing or you can do this by owning some individual stocks.
So, I've been a fan of EV for years. I have gone to EV meets (when they were rare, to see the cars). I've owned a few related stocks, over the years. I have looked at oil as legacy fuel for a decade, although I have owned oil related companies recently and would buy again. I think a lot of people consider me to be an environmentalist. For 20 years, until six months ago, I drove VW diesels. I do a ton of highway driving and they suited our needs extremely well. I sold the vW diesel wagon 6 months ago and now drive a truck 100% of the tine.. I have a one ton diesel and a half ton gas. Now, I think people consider me a right wing, anti environment, extremist.
A nice day so far for the mainstream old school TECH GIANTS today.....at least....outside the chip companies. Plenty of time left in the day for things to change.......so basically a meaningless comment.
How crazy is it that in 2024, a DIVERSIFIED portfolio means that you can be exclusively invested in Nasdaq companies, where NVDA and TESLA will be down, and APPL & GOOG will be up. I remember when I was a young buck, waaaaay way back in 2020 where if major nasdaq companies would be down they will take the entire sector with them
you and I are extreme right wing fundamentalists. The only difference is that in addition to that, I’m also a third reich supporter because I drive a Tesla
This is a smart move by HD. Home Depot will open four distribution centers as it looks to home pros to drive sales growth https://www.cnbc.com/2024/03/14/hom...bution-centers-in-home-professional-push.html (BOLD is my opinion OR what I consider important content) "Key Points Home Depot is building four new distribution centers to cater to home professionals. The pro customers make up about half of Home Depot’s business and are critical to its growth strategy. Home Depot revenue fell in 2023 and it projected another lackluster year of sales. Home Depot said Thursday that it will open four new distribution centers as it chases more sales from remodelers, contractors and other home professionals. The new distribution centers are expected to open in the first half of the year in Detroit, Los Angeles, San Antonio and Toronto. The facilities make room for the bulky size, wider variety and larger orders of products that pros need, such as lumber, shingles and insulation, which then can be delivered directly to a job site. Each facility averages approximately 500,000 square feet — about five times the size of the average Home Depot store. The expansion of the distribution centers is part of a years-long company strategy to attract pros who handle bigger and more extensive projects, such as a major renovation or kitchen remodel. Home Depot has opened 14 similar distribution hubs to serve pros in major metropolitan areas, starting with the first that it opened in Dallas in 2020. Home Depot draws roughly half of its total sales from pros and the other half from do-it-yourself customers, such as homeowners tackling a painting project. Yet winning more of pros’ business has become critical as Home Depot tries to return to growth and navigates a higher interest rate environment that has slowed housing turnover and chilled demand for home improvement projects. Home Depot’s sales declined by 3% in the last fiscal year as customers took on fewer projects after the pandemic. The company said it expects total sales to grow about 1% this fiscal year, including the lift from an additional week. It anticipates comparable sales, which takes out the impact of store openings and closures, to fall about 1%, not including the extra week. Beating those lackluster expectations could depend on pro customers, who are usually steadier and bigger spenders compared to DIY customers, said Chip Devine, Home Depot’s senior vice president of outside sales, who oversees the company’s pro business. They also need more specialized salespeople and services, which means they’re less likely to jump between retailers or switch to a competitor. “We interact with them five times a week,” he told CNBC. “That relationship over time, you become a partner to their business, and that is easier than capturing the elusive consumer.” Plus, he said, pros that handle more complex projects have historically used Home Depot like a convenience store where they buy just a few items. That gives Home Depot a lot of room to grow as it adds capabilities to handle pros’ entire orders, he said. On the other hand, do-it-yourself customers have become a tougher sell. They have made fewer discretionary purchases and tackled smaller home projects in recent quarters. Big-ticket transactions, or those with a price tag of over $1,000, fell by nearly 7% in the fourth quarter compared with the year-ago period, the company said on its earnings call last month. Home Depot is changing other aspects of its business to support pros who handle complex and pricey projects. It is piloting a program that offers trade credit to pros, which means that Home Depot underwrites a large order and does not charge the pro customer until it is delivered — a standard that’s common in the industry, Devine said. The retailer also expanded its dedicated sales force for pros. And it has added digital and personalized features for pros, such as tools that help manage complicated orders and a loyalty program that offers perks. In a CNBC interview, CEO Ted Decker describedbuilding up the pro business as one of three key priorities for the year, along with building new stores and creating a more seamless experience for customers. He said Home Depot is trying to bring to the pro business what it once did to DIY — turn itself into a one-stop shop. “Before Home Depot came along, a consumer doing a project was running to all these different stores,” he said. “You’ve got a hardware store. You’ve got a paint store. You’ve got a flooring store. The pro’s doing the same thing.”" MY COMMENT Sounds like smart marketing to me. It has been happening for a good length of time now. I have noticed over the past 10-15 years that the number of contractors and construction people at our local Home Depot stores has significantly increased. Where else are they going to go? The old time lumber yards and other outlets that served the contractors are quickly disappearing. Why not go after that business....if you can at the same time maintain your focus on your retail customer base. It is free money....since the infrastructure of stores is already in place.
Way to go NASA.....a hugely successful launch today. Oh wait a minute......NASA does not exist anymore.....as a country we have no ability to launch anything. It is ALL....ELON MUSK. SpaceX success! Elon's $3bn rocket performs its first successful test flight in orbit - as Musk moves one step closer to sending NASA astronauts back to the moon https://www.dailymail.co.uk/science...eventually-carrying-NASA-astronauts-moon.html The progress that MUSK has made in just three test launches with this record breaking rocket is amazing.
Today is OLD SCHOOL....big cap tech day in the markets. Looking at my accounts and those that I manage.......some are actually in the green and some are in the red. The difference......the number of shares they each have in....NVDA, PLTR, and SMCI. All the account have the same basic stocks and funds....but they all vary sightly in the amount of each holding...primarily due to the length of time each account has been in existence. Even though the averages went from a green open to red.....the stocks that are UP in my accounts and the stocks that are DOWN remain the same. Those that are UP: MICROSOFT CORP ALPHABET INC. CLASS A APPLE INC AMAZON.COM INC COSTCO WHOLESALE CO So even though we just had a little market freak out.....nothing much has changed in any of my accounts today from the open.
In other news, I successfully filed my taxes yesterday. Talk about inflation, the IRS is NOT getting much from us this year as our utilities, construction work, supplies and maintenance expenses SKYROCKETED last year to the tune of 20-30% higher than normal. In addition to that we spent 50-60k towards professional and legal fees in relation to our Ohio location which we weren’t able to write off as an expense since the business is not yet operational. So yea, last year we didn’t manage to save much, but we did manage to make a killing in our stock portfolio, which in a way gave our savings a tremendous boost
Good thing you have your stock portfolio. It all helps to balance out. The life of a business person in the middle of expansion....bleeding money. No one in government or politics notices what you are going through right now. You are on your own. BUT.....in a few years when it starts to pay off.....they will all be there with their hand out claiming that....."you did not build that".
Looks like the REAL ESTATE market in our little area is RED HOT. Lots of pending homes.....many of them above $1MILLION. Of course the market below $1MILLION is doing well also. I am even seeing homes come on the market and sell in just a day or two. The lowest priced home in our little area.....$650,000. Just 26 homes for sale out of 4200 homes in this area. The highest priced home....just under $10MILLION. For this time of the year our inventory is extremely low. A continuation of the trend in recent years. When we see rates drop some into the 5-6% range. The market is gong to EXPLODE. I have no doubt we will see prices quickly go up and we will be back into multiple offers.
Another outstanding Alex Karp interview yesterday. Favorite line, when asked about how does he feel about crushing the short sellers: “We will lead their coke dealers to their homes after they can’t pay their bills”
I've been in Portugal couple of years ago. We went in February and it was too hot for me, came back home with sunburns. But nice country, beautiful language.
