Daily Research Updates
Morning Briefings
Expert market analysis delivered every morning. Stay informed with comprehensive research and data-driven insights.
Earnings-Led Meltup!
Check out the accompanying pdf and chart collection. (1) S&P 500 forward earnings go from lagging to leading the market. (2) Forward revenues, earnings, and profit margin all at record highs. (3) S&P 500 operating earnings up 47% during Q1. (4) No sign that rising costs are squeezing profit margins. (5) Solid productivity pop during Q1. (6) An update on sausage making in Washington. (7) There’s still some hope that checks and balances will rein in progressives’ wish list.
More Tapering Talk
Check out the accompanying pdf and chart collection. (1) How many is “a number” of participants? (2) Tapering sooner rather than later? (3) Two hawks and three doves. (4) More states are cutting jobless benefits. (5) Plenty of job openings. (6) Camps and schools are reopening. (7) Will Powell pivot again? (8) Fed’s word games. (9) Bond market conundrum 2.0. (10) Few signs of tapering tantrum in the bond market or in stock market forward P/Es. (11) Valuation multiples down for Mag-5 and overseas stocks.
Not That ’70s Show
Check out the accompanying pdf and chart collection. (1) Inflation was so 1970s! (2) Comparing the 2020s to the 1970s. (3) Wages soared while productivity crashed during the Great Inflation. (4) This time, productivity may be making a comeback. (5) The risk is a wage-price spiral. (6) Dopamine demand shock plus policy stimulus shock boosting inflation now. (7) No shortage of shortages. (8) Buddy, can you spare a house? (9) Rent inflation could make a comeback. (10) US provides the world’s economy with a shot in the arm. (11) Brief world tour. (12) Movie review: “Godfather of Harlem” (+ + +).
Tapering, Housing & Batteries
Check out the accompanying pdf and chart collection. (1) Fed’s April minutes never say “tapering” but imply it’s coming. (2) Elevated valuations get a shout-out. (3) Rate hiking could start before mid-2022. (4) Everyone has a housing tale. (5) After a long run, housing stocks pull back. (6) High lumber and steel and copper prices … oh my! (7) Rising construction industry wages add to pressure. (8) Homeowners across the country enjoy double-digit price increases. (9) Watching inventories and mortgage rates. (10) Solid-state electric vehicle batteries could be a game changer. (11) Checking out Harvard, Toyota, QuantumScape, and Solid Power.
Over-the-Top Earnings
Check out the accompanying pdf and chart collection. (1) Are inflationary booms good for profits? (2) Winners and losers in an inflationary boom. (3) Nominal GDP and business sales confirm inflationary boom. (4) Bullish for S&P 500 revenues. (5) Q1 earnings rose twice as fast as expected. (6) S&P 500 forward earnings is flying. (7) Forward profit margin sets another record high despite rising costs. (8) What’s behind the Baby Bust? (9) Unmarried Millennials. (10) Freaked out by the pandemic and climate change. (11) Too many singles, not enough babies.
The Technology Imperative
Check out the accompanying pdf and chart collection. (1) Technology rules the business world. (2) We are all in the cloud now. (3) Tech still accounts for a quarter of S&P 500’s market cap and a fifth of its earnings. (4) Tech is more powerful, more useful, and cheaper than ever. (5) S&P 500 excluding Tech and excluding the Mag-5. (6) A few examples of low-tech companies using high-tech to boost profit margins. (7) The proof is in the profit margins and spending on tech. (8) A word of caution. (9) Value’s turn to outperform for a while. (10) Cryptocurrencies: nothing to fear but government bans. (11) Tulips and dotcoms..
Inflationary Boom or What Else?
Check out the accompanying pdf and chart collection. (1) Reagan & Volcker versus Biden & Powell. (2) Different spins on the inflationary boom from pessimists and optimists. (3) Tech-led productivity is the only way out of this mess. (4) Too many college graduates. (5) The meaning of post-pandemic life. (6) Fear of shortages versus fear of inflation. (7) Business cycle on fast track. (8) Base-effect inflation should diminish in coming months, but rent inflation could rebound. (9) Two conflicting measures of medical care services inflation. (10) Inflation remains subdued according to Cleveland Fed’s median CPI. (11) Movie review: “The Woman in the Window” (+).
CPI, Retailing & 2022
Check out the accompanying pdf and chart collection. (1) CPI jump mostly about, but not solely, a base effect. (2) Used cars and home-related goods get pricier. (3) Amazon and Tesla dragging down the Consumer Discretionary sector’s ytd returns. (4) Most other Consumer Discretionary industries are having a good year. (5) Taking a look at 2022 S&P 500 earnings. (6) Industrials, Consumer Discretionary, and Energy seen having fastest earnings growth next year. (7) Boom in Materials ends if analysts are right. (8) Looking at Elon Musk’s other companies. (9) Monkeys playing Pong telepathically. (10) Boring underground to relieve traffic.
On the Margin
Check out the accompanying pdf and chart collection. (1) Is it time for a correction or just more rotation? (2) Technical indicators show too much bullishness. (3) Selling on awesome earnings news. (4) Getting tipsy about inflation. (5) Small business owners raising prices like its 1981. (6) An unprecedented V-shaped economic and earnings recovery. (7) A first-quarter earnings season for the record books. (8) Upward revisions galore. (9) No sign that rising costs are squeezing margins so far. (10) Early-cycle productivity “pop.” (11) Broadening bull.
The Opera Ain’t Over Until Papi Sings
Check out the accompanying pdf and chart collection. (1) The DarkSide is holding America up for ransom. (2) Ransomware gangs don’t take cash or checks. Bitcoin accepted here. (3) Are cryptocurrencies similar to viruses? (4) Will governments ban them? (5) Yellen’s senior moment. (6) Before tightening, Powell wants to see crowds gathering, jobless benefits run out, and schools reopen. (7) Powell’s dashboard: no green light for tapering yet. (8) The Fed issues a hedgy note on financial stability risk. (9) Powell and Brainard: He said, she said.
Bad & Good Inflation News
Check out the accompanying pdf and chart collection. (1) Tales of two employment surveys. (2) How many workers are actually unemployed? (3) Our Earned Income Proxy jumped to new record high in April. (4) Strange employment readings for different industries. (5) It pays to stay home rather than to go to work. (6) Biden seeks to build on legacy of progressive presidents. (7) The anti-Reagan. (8) Input costs continue to soar, and shortages are a big problem. (9) Productivity usually pops during recoveries and is doing it again. (10) Labor costs actually fell during Q1. (11) Profit margins still recovering despite cost pressures. (12) What are wages up to? (13) Movie review: “The Serpent” (+ + +).
Talkative Yellen, Chip Shortage, and Bad Drought
(1) The Fairy Godmother causes mini taper tantrum. (2) Boom times at semiconductor companies. (3) Shortages may end just-in-time purchasing. (4) New capacity may take years—not quarters—to build. (5) Temperatures are heating up out West. (6) Tech companies creating gadgets and apps to help with drought. (7) Farming moves indoors and goes vertical. (8) Solar panels coexist with crops.
Crushing Earnings
Check out the accompanying pdf and chart collection. (1) Earnings on a hot streak. (2) A remarkable earnings hook. (3) Earnings now expected to be up 30% this year. (4) Analysts predicting record-high profit margin. (5) Forward earnings rising in record-high territory. (6) Earnings surprises are widespread. (7) Insanely stimulative policies driving earnings charge. (8) Raising our revenues, earnings, and profit margin forecasts. (9) Just-in-time inventory shortages. (10) A whiff of stagflation in latest M-PMI. (11) The shortage of workers is structural.
JRB & FDR
Check out the accompanying pdf and chart collection. (1) The end of prohibition. (2) FDR, LBJ, and JRB expand the social welfare state. (3) Lots of plans to Build Back Better. (4) The anti-Reagan is pro-unions. (5) Reversing PATCO. (6) Raising wages by decree. (7) Amazon cares about its workers, so they don’t care to unionize. (8) $15 is becoming the new $10 for hourly pay. (9) Trickle-down wage increases from Amazon and Walmart. (10) Will Biden restart the wage-price spiral? (11) Wage inflation measures remain subdued, but not for long. (12) Is a refundable child tax credit the start of a universal basic income?
Taxing Matters
Check out the accompanying pdf and chart collection. (1) Third round of relief checks. (2) Record increase to record high in personal income. (3) Personal saving at record high. (4) Plenty of liquidity available to push real GDP to record highs over rest of 2021. (5) Why raising tax rates may not raise tax revenues. (6) Economic growth is the best driver of tax revenues. (7) Tax expenditures are a sinkhole of exemptions and deductions. (8) Taxing capital gains. (9) The One Percent is paying more than 40% of federal income taxes. Isn’t that enough? (10) Trump’s tax cut benefitted people who probably hired more people with their tax windfalls. (11) Movie review: “Quo Vadis, Aida?” (+ + +).
Hubris Goeth Before a Fall
Check out the accompanying pdf and chart collection. (1) Off-base inflation assumptions. (2) Fiscal and monetary policies sending demand well above supply. (3) Not-so-transient inflation may force Fed action. (4) Beware taper tantrums. (5) China’s latest misdeeds. (6) Tesla bows to Chinese government’s pressure. (7) Companies opting out of China. (8) Chinese censors cancel director’s Oscar win. (9) China’s Orwellian campaign goes global. (10) World leaders waking up. (11) From jeans to genes. (12) A look at the picks and shovels in genomics.
Profitable Corporations
Check out the accompanying pdf and chart collection. (1) Great fundamentals for S&P 500. (2) Earnings jumped about 50% during H2-2020, with revenues up about 15% and margin up 30%. (3) Impressive and surprisingly widespread rebound in profit margin. (4) Rising costs weigh on profit margins of users but boost margins of suppliers. (5) Analysts continue to raise their earnings estimates for this year. (6) Biden corporate tax hike likely to take a bite next year. (7) Floating on a sea of liquidity. (8) Capital markets wide open. (9) Government’s visible lending hand averted widespread bankruptcies. (10) SPACs’ shell game may be over now that there is a new sheriff at the SEC.
Inflation: The Japanese Model
Check out the accompanying pdf and chart collection. (1) Something very Zen about Japan. (2) Japan’s population is shrinking and aging rapidly. (3) Japanese government debt at 220% of GDP. (4) Flat nominal GDP for 24 years. (5) Prolonged period of deflation. (6) Japan has been doing MMT for at least a decade. (7) Used car prices soaring. (8) Missing chips. (9) Soaring home prices could soon boost rents. (10) PPI inflation rates heating up some more in US and Asia. (11) CPI inflation rates remain subdued in US, Eurozone, and Asia. (12) Extreme alternative inflation scenarios: Japan now vs Germany from 1921-23.
New World Disorder
Check out the accompanying pdf and chart collection. (1) Head-spinning stuff. (2) A chat with a Canadian surgeon in a pool in Florida. (3) India’s disaster. (4) Three red-hot US regional business surveys. (5) Home prices are on fire. (6) A shortage of blue-collar workers. (7) Prices-paid and prices-received indexes continued to soar in April. (8) Speed bumps for SPACs, cryptocurrencies, and stock prices. (9) Outperforming investment styles underperforming recently. (10) Bad actors: Putin and Xi. (11) Bond Vigilantes taking a siesta. (12) Movie review: “I Care a Lot” (+ +).
Banks and DApps
(1) Crosscurrents in banking. (2) Banks’ deposits are up, and borrowing is down. (3) Companies don’t need bank loans. (4) Banks holding lots of Treasuries and cash. (5) Net interest margins feeling the squeeze. (6) Released reserves save the day. (7) Introducing dApps. (8) Bitcoin may dominate payments, but Ethereum dominates dApps. (9) Keeping an eye on the Binance Smart Chain.
Stimulus Shock
(1) Cookies and politicians. (2) Addicted to sugar. (3) Beef, pork, and mystery meat in pandemic relief acts. (4) Handy crib sheet to keep fiscal spending score. (5) Running out of workers to “Build, Back, Better.” (6) Employers need workers who can spare some time to work for a living. (7) Small business owners have lots of job openings. (8) Tight labor markets likely to boost wages. (9) Small business owners raising prices and expect to continue doing so. (10) Earnings enjoying the sugar high. (11) Mag-5 plus Tesla dominate their S&P 500 sectors.
For Whom the Bull Tolls
(1) Happy vs sad theme songs. (2) Old stock market adages. (3) Waiting for the next panic attack. (4) The relevance of Ernest Hemingway. (5) Contrarians say the sun also sets. (6) Too much bullish sentiment? (7) MMT + TINA = MAMU. (8) Margin debt again. (9) Into the weeds of Biden’s proposal to increase corporate tax revenues. (10) GILTI as sin. (11) A tax even Europeans don’t like.
The Off-the-Charts Economy
(1) Relief checks fuel retail buying spree. (2) GDPNow tracking at 8.3% for Q1. (3) Lots of record highs in major retail sales categories. (4) Gasoline usage almost fully recovered. (5) Housing-related retail sales booming. (6) Business sales are bullish for S&P 500 revenues. (7) Lean inventories set stage for even more economic strength in coming months. (8) NY and Philly business survey are on fire. (9) Tug of war in the bond market: Shoguns vs Vigilantes. (10) The Fed’s talking heads can’t stop talking. (11) More backward-looking forward guidance. (12) Movie review: “The Courier” (+ +).
China Trouble
(1) Waking up to China’s hostile agenda. (2) China’s military might is on show on the South China Sea and near Taiwan’s airspace. (3) Hong Kong is officially under China’s thumb. (4) CEOs learn to bite their tongues to do business in China. (5) Foreign CEOs may soon find they need to pick sides. (6) Hackers and spies and lies—oh, my! (7) Chinese stocks had a great 2020, but tough start to 2021. (8) A digital yuan could push US pols and regulators to get moving on a digital dollar.
Government Gone Wild
(1) Off-the-charts fiscal policies. (2) Nonstop handouts. (3) Swelling outlays swell federal budget deficit. (4) Treasury spending on Income Security soars. (5) Government spends mostly on redistributing income now. (6) Shrinking the tax base isn’t a good way to increase tax receipts. (7) MMT tells politicians it’s alright to spend more until inflation makes a comeback. (8) Helicopter Ben was wrong about the delivery aircraft. (9) Lots of government social benefits to persons. (10) An update on the Magnificent Five.