Daily Research Updates
Morning Briefings
Expert market analysis delivered every morning. Stay informed with comprehensive research and data-driven insights.
Consumers, Earnings, And Proteins
(1) Falling Covid-19 cases inspire dreams of hitting the mall. (2) Uncle Sam boosts personal income. (3) Consumers deleveraged a little, saved a little, and spent a lot. (4) Deferred rent, mortgage, and student loan payments help too. (5) Home retailers face tough comps this year. (6) Clothing retailers will have easier comparisons if we have occasions to dress up in 2021. (7) Burning our sweatpants. (8) Are positive forward earnings revisions slowing? (9) Scientists hoping proteins are the key to curing cancer, Parkinson’s, and Alzheimer’s.
Morning Briefing 2021-02-24
(1) Fink’s “Dear CEO” letter. (2) Building a Green New Capitalism (GNC). (3) An existential crisis. (4) FOE’s and WEF’s agendas are on the same page. (5) Stakeholders matter more than shareholders. (6) Davos men and women working together for the common good. (7) The goal of the Great Reset is carbon-free and inclusive capitalism. (8) Lots of global movers and shakers are on board. (9) Fink’s warning: “Companies, ignore stakeholders at their peril.” (10) What’s your ESG score? (11) From FASB to SASB. (12) Bloomberg is on the case. (13) Central banks going green.
On the Road to Reflation
(1) Unprecedented policy stimulus boosting cost pressures. (2) Bond Vigilantes getting set to ambush policymakers on the road to inflation. (3) Yellen and Powell say they have “tools” to fight inflation. (4) Powell sees “transient” inflation coming this spring. (5) Williams say stock market valuations are fine and dandy. (6) Three regional price surveys showing more inflation in the pipeline. (7) Copper leading commodity price rally. (8) Copper tracks inflationary expectations proxy. (9) Extraordinary growth in monetary aggregates. (10) S&P 500 winners and losers if inflation makes a comeback.
Getting Hotter
(1) Some like it hot. (2) The risk is overheating a hot economy. (3) Acting big means bigger deficits and lots more debt. (4) Yellen once worried about deficits. (5) Yellen aims to get back to full employment by next year. (6) Powell and Yellen say jobless rate is more like 10% now. (7) FOMC would welcome an inflation warm-up. (8) January’s latest economic indicators are hot. (9) Housing-related industries are booming. (10) Running out of housing inventory. (11) Are Bond Vigilantes getting set to ambush policymakers on the road to inflation? (12) Movie review: “Judas and the Black Messiah” (+ + +).
Have Shot, Will Travel
(1) Disney wishes on a star, vaccines for all by April. (2) Carnival’s customers booking for 2H-2021. (3) S&P 500 Biotech underperforms, but smaller biotech names are on fire. (4) All biotech ETFs are not alike. (5) Outperformers boosted by acquisitions and hot IPO market. (6) Nuclear energy reimagined: smaller, cheaper, safer. (7) Bill Gates-backed TerraPower and X-energy win DOE contest to build SMRs (small modular reactors).
‘V’ for Victory?
(1) The third wave of the pandemic has crested. (2) From a plague to a pest. (3) Stock market isn’t disconnected from economy and earnings. (4) Earnings likely to be flat y/y during Q4. (5) Expecting a 25% increase in 2021 earnings over 2020. (6) Forward revenues and earnings almost back to pre-pandemic levels. (7) Impressive rebound in profit margin. (8) Hot commodity prices confirming V-shaped global recovery. (9) Solid recoveries in global PMIs and leading indicators. (10) Global bull market in stocks driven by upbeat fundamentals. (11) US Growth stocks are highly valued. (12) US Value stocks have about the same forward P/E as overseas stocks.
Good vs Bad Endings
(1) Zooming worries. (2) A trillion dollars here, a trillion there. (3) Mission accomplished, so far. (4) Nasdaq partying like it’s 1999 once again? (5) Home prices are also having a party. (6) Cost pressures mounting but not showing up in CPI, yet. (7) Pandemic has boosted some prices and depressed other prices. (8) Expect a post-pandemic reversal of pricing power. (9) Rent inflation continues to fall, and has lower to go. (10) The Fed keeps resuscitating Zombies, while trying to bury the Vigilantes. (11) Blue Angels for the government’s net interest. (12) Movie review: “Promising Young Woman” (+ + +).
Onshoring & Charging
(1) Optimism about S&P 500 Q1 earnings growth on the rise. (2) S&P 500 Energy & Real Estate sectors enjoy the biggest Q1 upward earnings estimate revisions. (3) Only Utilities’ and Industrials’ estimates get cut. (4) Shortages of masks and semis highlight importance of domestic supply chains. (5) Taiwan Semi building in Arizona, while Samsung scouts for a location. (6) “Green” technology companies building new manufacturing capacity too. (7) Many capital goods orders on the rise. (8) Norway, world’s EV leader, tries wirelessly charging taxi batteries. (9) Nio swapping batteries in China. (10) UK ponders how to charge cars parked on the street.
Help Wanted
(1) Summers trashes Biden’s winter plan. (2) Providing disincentive to work. (3) Not enough workers with the right skills? (4) Private-sector wages and salaries at record high. (5) Our Earned Income Proxy was strong in January. (6) Wages rising at faster pace. (7) Payroll tax receipts at record high. (8) Small businesses are hiring, but can’t find qualified workers. (9) Job postings back to pre-pandemic level. (10) Ratio of unemployment to job openings drops. (11) Quits jump reflecting labor force dropouts rather than job switchers. (12) Biden’s plan is too stimulating. (13) An update on the major central bankers.
The Government Is Here To Help
(1) Yellen is more powerful than ever. (2) Can Yellen fend off the Bond Vigilantes? (3) A wildly ambitious agenda to solve four crises. (4) A meeting of regulators to discuss stock market volatility. (5) Yellen predicts full employment next year if Biden plan is passed. (6) A student of inflation and how to squelch it. (7) Professor Summers says it’s too much, and could bring back inflation. (8) Why work? (9) Expected inflation rising along with commodity prices. (10) Fed buying lots of notes and bonds.
Earnings Season’s Greetings
Check out the accompanying pdf and chart collection. (1) Positive revenues and earnings surprises. (2) Tweaking our earnings forecasts. (3) Still targeting 4800 for S&P 500 by year-end 2022. (4) More fiscal stimulus will boost earnings this year. (5) Corporate tax hike likely to pare earnings next year. (6) Profit margins have been remarkably resilient. (7) Another quarterly earnings hook. (8) The meltup risk again. (9) Bullish PMIs. (10) Personal income gets a boost despite weak employment. (11) T-Fed’s digital printing presses are on overdrive. (12) Inflationary pressures building below the calm surface of consumer prices. (13) Bond Vigilantes may be coming back from the dead. (14) Movie review: “The Little Things” (+ +).
Chips Shortage
Check out the accompanying pdf and chart collection. (1) Semiconductor sales and stocks booming. (2) Auto manufacturers searching for chips. (3) Introducing gallium nitride. (4) NXP forecasts strong Q1. (5) Cloud computing driving chip demand too. (6) Chinese focused on developing home-grown chips. (7) US tech giants want to develop semis in house too. (8) Watching the US and Chinese 5G rollout race. (9) Abu Dhabi can claim best 5G download speeds in the world. (10) China’s in the lead, but it’s still early days.
Watching Inflation: More Signs of Trouble?
Check out the accompanying pdf and chart collection. (1) Inflation is up for discussion. (2) Inflation’s eeny, meeny, miny, moe. (3) The tug of war between the 4Ds and MMT. (4) Regional prices-paid and prices-received indexes are hot. (5) M-PMI prices-paid index also heating up. (6) In recent years, not much correlation between the CPI and the dollar, commodity prices, import prices, intermediate PPI, or survey measures of prices paid and received. (7) Barely any inflation in the Eurozone, Japan, and China. (8) IMF advises policymakers to err on easing side. (9) Earnings seasons now and then.
Funny Money
Check out the accompanying pdf and chart collection. (1) Something is off. (2) Yellen and Lagarde warn about dark side of cryptocurrencies and favor regulation. (3) Is a stablecoin driving the volatility in bitcoin? (4) Waiting for the AG’s report. (5) Citadel is playing both sides of the Street. (6) The third wave of the pandemic is cresting. (7) A third wave of checks is coming. (8) High-frequency economic indicators remain high. (9) Consumers are sitting on a pile of liquid assets, as reflected in MZM and M2. (10) Business spending booming. (11) Construction booming.
Gamesters vs the Dynamic Duo
Check out the accompanying pdf and chart collection. (1) Gamesters: The new kids on the Street. (2) Shorts get roasted in game of chicken. (3) Robin Hood vs the sheriff of Nottingham. (4) Don’t fight the T-Fed duo in the Game of Thrones. (5) Powell prioritizes “broad-based and inclusive” maximum employment over both inflation and financial stability mandates. (6) A narrow definition of macroprudential policy jurisdiction. (7) Powell claims recent valuation-multiple spikes weren’t caused by Fed. (8) Much too soon to think about thinking about tapering. (9) The income-equality mandate: Minding the gaps. (10) T-Fed’s BFFs. (11) Unasked question. (12) Yellen wants to rebuild the economy. (13) Four crises and Rahm’s Rule. (14) Movie review: “The White Tiger” (+ +).
Faster 5G Rollout & Faster-Charging Batteries
Check out the accompanying pdf and chart collection. (1) 5G and EV: two races to watch. (2) T-Mobile leads the 5G rollout, leaving Verizon and AT&T playing catch-up. (3) T-Mobile has the broadest nationwide coverage, the best 4Q subscriber growth, and much better share price performance over the past year than its two rivals. (4) 5G opens the door to technological marvels galore. (5) A look at S&P 500 P/E inflation over the past year. (6) Foreign EV automakers may see greener pastures in the US after Biden’s initiatives. (7) The winner of the EV race may be the manufacturer with the longest-running, fastest-charging battery. (8) Innovation is super-charging EV battery evolution.
Morning Briefing 2021-01-27
Check out the accompanying pdf. (1) Victory over the virus may not require full herd immunity. (2) Widespread immunity of just the herd’s most essential and vulnerable equates to 230 million doses of vaccine, half as much as required for full herd immunity. (3) Looking at vaccine supply/distribution/administration logistics, we estimate the virus could go from plague to pest by summer 2021. (4) We think investors are right to assume that Biden’s strategic goals to fight the virus can be met. (5) But much still could go wrong to derail the optimism. (6) Virus mutations might represent the biggest threat.
Act Big
Check out the accompanying pdf and chart collection. (1) Yellen talks softly and carries a big act. (2) Government continues to spew out checks. (3) American Rescue Plan is fourth congressional pandemic response. (4) Bernie Sanders is all for reconciliation if Republicans won’t reconcile. (5) Rahm’s Rule again. (6) The Mag-5 underperforming despite their new record-high market cap. (7) Market breadth has improved thanks to vaccines. (8) V-shaped recovery in forward revenues, earnings, and margins. (9) In January, US PMIs remained remarkably robust. (10) Pandemic is mutating. (11) Stock market valuation multiples in outer space.
The Checks Are in the Mail
Check out the accompanying pdf and chart collection. (1) The Economist’s rocketship dodges the front-cover curse. (2) Samuelson’s mistake. (3) From lots of liquidity to tons of it. (4) The Fed is pumping away. (5) CARES Acts I-III add up to $3.6 trillion in rocket fuel. (6) Biden’s Acts IV and V would add another $4 trillion, give or take. (7) First round of rescue checks fueled rocketship recovery from lockdown recession last year. (8) Latest round of checks is half as much, but GDP is almost back to pre-pandemic level. (9) It may be time to start worrying about inflation, or at least monitoring it more closely. (10) Movie review: “News of the World” (+).
Covid’s First & Last Anniversary
Check out the accompanying pdf and chart collection. (1) Approaching Covid-19 anniversary. (2) Can businesses that grew because of Covid-19 maintain the momentum? (3) A look at Logitech, Peloton, and Netflix earnings and conference calls. (4) BofA works to keep the fintechs at bay. (5) Liquidity piling up at commercial banks, with deposits up 21.6% y/y. (6) Banks stashing cash in Treasuries. (7) Electricity generation getting a little bit greener every year. (8) Natural gas consumption expected to fall. (9) Welcome Tesla to the Magnificent Five.
Substantial Further Progress Ahead?
Check out the accompanying pdf and chart collection. (1) Yellen wants US government to “act big.” Seriously. (2) Act II of CARES Act could be as stimulative as Act I. (3) Full economic recovery from pandemic recession one year later. (4) Another (bigger) round of government checks with fewer social-distancing restrictions. (5) No double dip so far in credit and debit card shopping or in gasoline usage. (6) Higher inflation and bond yields as the year progresses. (7) Five new voters on FOMC with consensus views. (8) The Fed’s new mantra: “substantial further progress.” (9) The Fed’s new FAITH. (10) Free advice to Powell & Co.: Beware of what you wish for.
MMT on Steroids & Speed
Check out the accompanying pdf and chart collection. (1) Powell says it again: Not thinking about raising rates. (2) Powell impressed by recovery. (3) Rosengren endorses Biden plan. (4) Fed and banks financed most of 2020 federal budget deficit. (5) Yields stay low despite soaring commodity prices. (6) New record high in real GDP coming this year. (7) Economy getting Blue Wave booster shot. (8) Upward revision in December retail sales likely. (9) Yellen & Powell: MMT-BFFs. (10) Tech boosts capital spending. (11) The Blue Wave and the budget reconciliation process. (12) Movie review: “The Flight Attendant” (+ +).
Financials on the Move
Check out the accompanying pdf and chart collection. (1) Optimism rising about Financials earnings. (2) Steeper yield curve and booming markets kick 2021 off right. (3) Bank buybacks look ready to resume. (4) Loan loss reserves low with government help. (5) Beware fintech competition and higher taxes and regulations from Democrats. (6) Technology lets us do just about everything from the couch. (7) Keeping an eye on software as a service, artificial intelligence, and quantum computers. (8) Elon is our hero. (9) Robots on the rise and medical miracles.
Not in Kansas Anymore
Check out the accompanying pdf and chart collection. (1) Dorothy and Stephanie. (2) The power of myths. (3) Surreality. (4) The sky is the limit for T-Fed in MMT world. (5) Ease on down the yellow brick road to socialism. (6) The central bank wizards. (7) Free money for all. (8) Are the Bond Vigilantes making a comeback? (9) Yield-curve targeting coming? (10) Bitcoin: the official currency of Oz. (11) Managing money in Oz. (12) More style rotation in 2021. (13) Tesla is in outer space.
Will Blue Wave Increase Or Decrease Earnings?
Check out the accompanying pdf and chart collection. (1) Valuations vs mutating virus. (2) Retail sales stalled late last year. (3) Our proxy for wages and salaries continued to recover in December as government benefits declined. (4) Here comes another round of pandemic support checks to lift consumer spending. (5) Unbelievable: Real GDP has almost fully recovered. (6) Santa delivered bullish PMIs. (7) Signaling solid revenues recovery this year. (8) We are more positive on revenues than the analysts. They are more positive on profit margins than we are. (9) Buybacks should make a comeback this year unless they are drowned by the Blue Wave tsunami.