Daily Research Updates
Morning Briefings
Expert market analysis delivered every morning. Stay informed with comprehensive research and data-driven insights.
Alpha, Beta, and Delta
Check out the accompanying pdf and chart collection. (1) Dovish comments from a Fed hawk. (2) FDA gives seal of approval to Pfizer vaccine. (3) Dr. G says Delta has peaked. (4) Mandating vaccinations. (5) From risk-on/risk-off to Delta-on/Delta-off. (6) A Productivity Portfolio for all seasons. (7) Is inflation coming or going? (8) The base effect should start wearing off soon. (9) Persistent shortage of new autos could continue to boost their prices. (10) Soaring home prices putting upward pressure on rent inflation. (11) How much longer will healthcare inflation remain subdued? (12) Inflationary pressures persist in price surveys.
Double, Double Toil & Trouble
Check out the accompanying pdf and chart collection. (1) A very short history of S&P 500 doublings and 12 months after. (2) Likely to take a while for next doubling. (3) The arithmetic of getting to 5000 and then 10,000. (4) DJIA 70,000 in our future? (5) Pikes Peak of earnings growth. (6) Forward revenues, earnings, and profit margins all at record highs for S&P 500/400/600. (7) SMidCaps underperforming LargeCaps even though the former’s fundamentals are better. (8) Peaking economic growth confirmed by LEI, flash PMIs, and two regional business surveys.
Red Flag
Check out the accompanying pdf and chart collection. (1) Hurricane season is here. (2) Stormy season ahead for stock market too. (3) Rooting for consolidation of 100% gain in S&P 500. (4) Three peaks—in economic growth, earnings growth, and policy stimulus. (5) Geopolitical risks rising. (6) Signs of a top in commodity prices and a bottom in the dollar. (7) Real retail sales are unreal in China. (8) President-for-life Xi needs more babies. (9) The world’s largest nursing home. (10) China uses America’s Afghanistan disaster to warn Taiwan. (11) Movie review: “Stillwater” (-).
Retail, Earnings & Carbon
Check out the accompanying pdf and chart collection. (1) Consumers spending differently now. (2) Sweatpants are out, notebooks and pencils are in. (3) Target beats analysts’ target. (4) Lowe’s CEO still upbeat on housing. (5) TJX customers back to bargain shopping. (6) Analysts defy Delta and raise earnings forecasts. (7) Hoping carbon-capture technology can save the world. (8) The oil giants enter the carbon-capture game. (9) Gathering carbon from the air, chimneys, and tailpipes. (10) Turning captured CO2 back into fuel.
Searching for Peak Inflation
Check out the accompanying pdf and chart collection. (1) Any pent-up demand left? (2) Business sales soared to new record high during June. (3) Restocking of depleted inventories should boost economic growth. (4) Factories are humming. (5) PCED inflation currently around 3.0%-4.0% should settle back down to 2.0%-2.5% later this year. (6) Should the Fed’s inflation target be raised from 2.0% to 3.0%? (7) Base effect having less effect on boosting inflation now. (8) Demand shock and supply shortages still boosting some prices. (9) Lots of inflationary pressures still in PPI, commodity prices, and prices-received indexes.
Reviewing Valuation
Check out the accompanying pdf and chart collection. (1) Fed moving from outcome-based to outlook-based policymaking? (2) Brainard explains the difference between reactive and preemptive. (3) Clarida’s whacky outcomes speech. (4) Powell’s three conditions for rate hiking. (5) But, starting tapering and completing it comes first. (6) Falling behind the inflation curve. (7) Very wide spread between valuations of LargeCaps and SMidCaps. (8) Same can be said of Growth-vs-Value spread. (9) Mag-5 continues to dominate investment styles. (10) Investing in Value in US isn’t much more expensive than doing so overseas.
A Long & Winding Road
Check out the accompanying pdf and chart collection. (1) Delta depresses consumer sentiment. (2) Fourth wave of the pandemic. (3) Dr. Gottlieb’s relatively reassuring outlook. (4) CCI is a better measure of consumer confidence than CSI. (5) Dopamine is the best drug for cabin fever. (6) YRI’s Earned Income Proxy at another record high. (7) Any pent-up demand left? (8) Mixed metaphor: Schumer claims to have crossed the finish line, but Pelosi has moved the goal post. (9) Are there enough workers and shovel-ready projects to get new infrastructure spending started? (10) Now, the hard part. (11) Movie review: “Mudland” (+ + +).
Consumers, Valuation & mRNA
Check out the accompanying pdf and chart collection. (1) Just as the party got started…Covid’s back. (2) This wave may pass faster than the previous three. (3) Consumers have jobs and money to spare. (4) Southwest sees a Covid impact, but Wendy’s and Sysco say all’s good. (5) Strong earnings knocking most forward P/Es down. (6) Tech multiples rise slightly. (7) Surging oil and commodity prices send Energy and Materials forward P/Es falling. (8) Hoping mRNA can cure everything. (9) Moderna and BioNTech make much more than just Covid vaccines. (10) Personalized cancer cures may be in our future.
Speed Bumps & Headwinds
Check out the accompanying pdf and chart collection. (1) A great leading indicator. (2) A business-cycle recovery on steroids and speed, but now what? (3) From tailwinds to headwinds. (4) The pandemic: It’s all Greek to me. (5) Slowdown ahead. Will it be normal or abnormal? (6) Parts shortages set the stage for more pent-up demand. (7) Small business owners can’t get enough help. (8) Liquidity growth is peaking too. (9) More tapering talk. (10) Productivity growth peak is a few years away and likely twice as fast as now. (11) “Substantial further progress” has been made. (12) Open for business with a record 10.1 million job openings.
Voluntary Self-Extinction Of the Human Race
Check out the accompanying pdf and chart collection. (1) Stop breeding, says VHEMT. (2) Cost-benefit analysis of having kids. (3) Ag revolution caused migration from farms to cities. (4) Urbanization has depressed fertility rates. (5) Pandemic and climate change are also depressing births. (6) The most alarming UN report on climate change yet. (7) Fahrenheit 3.6. (8) MMT might actually make sense for increasingly geriatric nations. (9) Japan as a role model for for human self-extinction. (10) The world according to Garp: fertility, population, and urbanization. (11) China’s three-child policy. (12) US demographic trends should boost productivity.
Man of La Mancha
Check out the accompanying pdf and chart collection. (1) Buenos dias. (2) Finding relief in Spain from cabin fever at home. (3) The Running of the Bulls has been canceled in Pamplona, but not on Wall Street. (4) Soaring earnings continue to drive the stampede of the charging bulls. (5) SMidCaps are very cheap relative to LargeCaps. (6) Supply constraints weighing on M-PMI. (7) Lots of unfilled orders to keep economy growing. (8) Memo to Powell: Substantial progress in the labor market. (9) No sign yet that inflation rebound is transitory. (10) Wage inflation stampeding in two industries. (11) Movie review: “The Titans That Built America” (+ + +).
Semis, Travel & Digital Dollars
Check out the accompanying pdf and chart collection. (1) Semiconductor shortages still plaguing auto companies. (2) Imbalance of semi supply and demand may drag into 2022. (3) SIA reports positive worldwide sales in June. (4) Semi companies forecast to grow earnings in 2022 even after a blowout 2021. (5) Delta puts everyone on high alert. (6) Drivers clogging the roads. (7) Hotel occupancy has recovered, but not fully. (8) Expect to use a digital yuan at the Winter Olympics. (9) EU and Japan already testing digital currency. (10) Fed still studying digital dollar.
There Is No Place Like Home
Check out the accompanying pdf and chart collection. (1) Hot in Atlanta. (2) Housing market is a mess. (3) Best cure for high home prices. (4) Would-be homebuyers bummed out and priced out. (5) New and existing home sales cool off. (6) Double-digit gains in home prices. (7) Housing inventories bottoming? (8) Falling vacancies for rental housing pushing up rents. (9) Evictions set to cause more turmoil in rental markets. (10) Homebuilding is in fits and starts. (11) Permits down sharply. (12) Materials costs and labor availability remain troublesome for homebuilders. (13) Assessing the outlook for S&P 500 Homebuilding.
Income & Wealth in America
Check out the accompanying pdf and chart collection. (1) A forthcoming exposé of corporate profits. (2) In summary: Profits beat the alternatives. (3) Profits drive widespread prosperity, which always entails some inequality. (4) Income mobility offsets income inequality. (5) America has evolved into a nation of proprietors. (6) Pass-through business owners personally account for at least 25% of employment! (7) Number of taxpayers in lowest income bracket has been declining. (8) Tax return data show upward income mobility. (9) Wealth inequality increases during periods of prosperity too. (10) The wealthy tend to be heavily invested in equities, which appreciate most during good times. (11) Real estate and pension entitlements more equitably distributed. (12) Adding Social Security as a retirement asset reduces wealth inequality significantly.
S&P 5000!
Check out the accompanying pdf and chart collection. (1) S&P 500 earnings still outpacing expectations. (2) Our target for S&P 500 is 5000 by year-end 2022. (3) Betting on continuation of elevated forward P/E. (4) Tech-related companies should continue to boost productivity and profit margins, and to prop up valuation too. (5) A bullish spin on US-China Cold War. (6) Industry analysts expect earnings winners in 2022 to be in S&P 500 Industrials, Consumer Discretionary, and Energy sectors. (7) 2023 earnings laggards expected to be Financials and Materials. (8) Normal forward P/E converging with normalized forward P/E. (9) Reversal of fortune for banks as loan loss reserves get back to normal. (10) Joe knocked down Tesla’s LTEG earlier this year. (11) Joe explains why LTEG is so high again.
The Fed, US Growth, China, and Cryptos
Check out the accompanying pdf and chart collection. (1) Fed in no rush to tighten. (2) Comparing June and July FOMC statements. (3) 2020’s recession was the shortest ever. (4) Solid gains in latest durable goods orders, consumer confidence, and Q2 earnings. (5) China changing the rules and spooking investors. (6) China’s VIEs: What exactly do US investors own? (7) China’s new nuclear missile base and military flights near Taiwan are alarming. (8) China’s laundry list of domestic headaches. (9) Senator Warren puts crypto on notice. (10) Spring Labs solves defi’s know-your-customer dilemma. (11) Is bitcoin in Amazon’s future?
European Tour
Check out the accompanying pdf and chart collection. (1) UK as a test case of virus variant vs vaccine. (2) Freedom vs mandates. (3) Economic Sentiment Indicator soaring in Eurozone. (4) Flash PMI highest in 21 years in Eurozone. (5) ECB following the Fed’s lead on inflation targeting. (6) Like the Fed, ECB in no rush to tighten. (7) Better never than late? EU finally ready to provide pandemic fiscal stimulus. (8) EMU MSCI has been lagging US MSCI since last year’s bottom. (9) US outpacing EMU in forward revenues and earnings race.
Hot Metals
Check out the accompanying pdf and chart collection. (1) Commodity price indexes at or near record highs. (2) Metals prices are mostly still red hot. (3) Easy money can explain high commodity prices and low bond yields. (4) Rising commodity prices tend to boost S&P 500 revenues and earnings. (5) Earnings Confidence Index is making a comeback. (6) Regional business surveys still finding strong growth and plenty of inflationary pressures. (7) More upside in leading indicators. (8) LEI/CEI ratio tracks S&P 500 profit margin.
Longest Bull Market On Record
Check out the accompanying pdf and chart collection. (1) S&P 500 immune to Delta variant of Covid? (2) Pace of vaccinations likely to quicken as Delta makes the evening news. (3) Fed policy not immune to Delta. (4) Comparing the current meltup to the 1999 ascent. (5) Earnings meltup has been leading stock prices higher since last spring. (6) S&P 500 forward P/E still stuck at 22.0. (7) Analysts’ consensus long-term earnings growth expectations are broadly insanely high. (8) The Mag-5 continues to set the fashion trend for all the major investment styles. (9) Amazingly wide spread between forward P/Es of S&P 500 LargeCaps and S&P 400/600 SMidCaps. (10) Movie review: “The Mosquito Coast” (+).
Transports, Tech & Fintech
Check out the accompanying pdf and chart collection. (1) Surging imports signal continued strong US economic recovery. (2) Demand is outstripping J.B. Hunt’s capacity. (3) Supply chain in knots. (4) Delays at the ports and on the rails. (5) Truck drivers in demand and getting higher wages. (6) Tech’s wide margins may attract regulatory scrutiny. (7) Traditional banks face growing fintech competition. (8) Square enters small business lending, and Robinhood goes public. (9) Defi uses no bankers, only blockchain. (10) The Wild West of banking.
Taking Stock
Check out the accompanying pdf and chart collection. (1) A weak panic attack over the past week. (2) A fourth Delta-led wave of the pandemic would boost vaccination pace. (3) Oil price dropped on Monday on OPEC+ deal to supply more oil, not on weak demand. (4) US petroleum usage back at 2019 record high. (5) Financials have more earnings power stashed in loan loss reserves. (6) Economic reopening fundamentals remain bullish. (7) Industrial production of technology hardware still soaring in record-high territory. (8) Industrials have record orders. (9) Record highs for S&P 500 forward revenues, earnings, and profit margin. (10) Bond yield is influencing stock market investment styles. (11) The jobless benefits vs jobs debate. (12) Kids just got more affordable.
Bond Conundrum Explained
Check out the accompanying pdf and chart collection. (1) A year of bond-market conundrums. (2) An old stock-market adage applies to the bond market now too. (3) Bond yields fall despite four months of higher-than-expected CPI inflation. (4) Powell’s four pandemic-related reasons not to rush to tighten. (5) The next inflationary shock likely to be in wages. (6) A few bearish indicators for bonds. (7) Fed’s bullish impact on bonds amplified by flood of deposits commercial banks forced to invest in bonds. (8) OPEC+ deal greases bond yields’ slippery slope. (9) Powell vs Greenspan conundrums.
Depersonalization-Derealization Disorder
Check out the accompanying pdf and chart collection. (1) A distressing disorder about dealing with reality. (2) Pandemic of the unvaccinated. (3) Did Euro 2020 spread Delta? (4) UK opens up as Covid outlook turns “quite scary.” (5) Plenty of stimulus left in M2 and order backlogs. (6) Restaurant sales at record high. (7) NY and Philly business surveys show inflationary boom continuing in July. (8) Fed is suppressing bond market’s opinion. (9) S&P 500 Growth boosted by drop in bond yield. (10) Is China preparing an invasion of Taiwan and a preemptive nuclear attack on Japan?
Peak Earnings Growth & Biden’s Competition Plan
Check out the accompanying pdf and chart collection. (1) Q2 marks peak earnings growth for current cycle. (2) M-PMI dips in June, but still signals earnings growth ahead. (3) As earnings growth slows, so may stock gains. (4) Federal agencies get Biden’s marching orders on boosting business competition. (5) Tech, healthcare, agriculture, and transportation industries are among those targeted. (6) Stocks shrug off threat of increased regulations. (7) Meet the progressive lawyers with their fingerprints on Biden’s plans. (8) Small electric airplanes taking flight.
Inflationary Boom Continues
Check out the accompanying pdf and chart collection. (1) Fed’s wish to overshoot inflation target has come true. (2) The temporary base-effect-and-bottleneck theory of inflation (BEABTI) is getting harder to believe. (3) CPI got hotter in June. (4) Base and baseless effects. (5) Are inflationary expectations well anchored? (6) More small businesses passing higher costs to higher selling prices. (7) ECB adopts FAITH. (8) Tapering will follow substantial progress. (9) Handicapping odds of Biden’s tax plans.