Daily Research Updates
Morning Briefings
Expert market analysis delivered every morning. Stay informed with comprehensive research and data-driven insights.
Is Everybody Happy?
(1) Remembering Ted Lewis’ catchphrases. (2) Consumer confidence highest since 2004. (3) Five Fed district business surveys pointing higher. (4) Eurozone confidence index points to faster real GDP growth. (5) Flash M-PMIs are hot. (6) Go Global beating Stay Home. (7) In perfect harmony. (8) Real hourly wage at record high. (9) Proprietors’ income is strong, and as important as corporate profits to jobs growth. (10) Comprehensive measures of standard of living have been rising to record highs for quite some time.
Everything’s Just Rosy
(1) Everything is just swell too. (2) Cyclicals confirming global boom with performance and earnings growth. (3) An earnings-led meltup isn’t a meltup. It’s a bull market. (4) Capital spending rises to record high. (5) Spending on manufacturing structures is weak, but industrial equipment spending is at a record high. (6) Spending on IT equipment and software continues to soar into record-high territory. (7) Caterpillar operating on all cylinders, while Union Pacific is chugging along, and GE is sputtering. (8) Movie review: “The Foreigner” (+ +).
Birth Dearth
(1) P&G not sure why sales are weak. (2) Bringing up fewer babies. (3) Fewer diapers and less shampoo. (4) Pulp nonfiction. (5) Abe wants Japanese to have more babies. (6) Abe also wants to beef up military. (7) Another sales tax hike is on the way. (8) Better Japanese GDP growth led by exports. (9) Inflation remains MIA. (10) In Japan, 75 is the new 65. (11) Will daycare revive Japan?
Fearless
(1) Where have all the black swans gone? (2) Trump’s white swan. (3) Hurricanes depressed Q3 results. (4) Q4 earnings estimates showing double-digit growth. (5) Analysts upbeat about 2018 and 2019 revenues and earnings. (6) On the lookout for gray swans. (7) Reprise of 1987? (8) Fed regime change. (9) When all QEs terminate, will stocks fall? (10) Black swans sighted in the South China Sea.
Halloween Is Coming
(1) Gee, the year is almost over! (2) September and October haven’t been scary this year. (3) Will Republicans deliver tricks or treats? (4) Nothing to fear but nothing from the Republicans on tax reform. (5) Market says: The correct question is “What if tax reforms happens?” (6) The way is cleared for the bulls. (7) Best tax code money can buy. (8) Supply-siders offer self-financing tax cuts. (9) Ratio of federal government revenues to GDP is very procyclical in a flat trend. (10) Government spending relative to GDP is countercyclical, with an upward bias since the Great Society entitlements extravaganza. (11) Two Fed districts are really hot this month.
From Seinfeld to Sinatra
(1) The last stock market correction until the next one. (2) Seinfeld market goes from flat (nothing happening) to new highs on nothing bad happening. (3) Investors to bull: Fly us to the moon. (4) Four times more bulls than bears. (5) S&P 500 sectors: Widespread bull market momentum in 200-dmas. (6) Leading the charge this year are IT, Industrials, Financials, and Materials. (7) Fed head tossup: winning whether it’s heads or tails. (8) Republicans scrambling to get tax reform done. (9) American demographics: The Fifties are so over. (10) Movie review: “Blade Runner” (+).
Path of Least Resistance
(1) Climb every mountain. (2) Stock prices rising day after day as forward earnings rises week after week. (3) Drug prices are too d%$!m high, but CPI drug inflation rate has come down a lot. (4) Public health concern. (5) FDA approving drugs at faster pace. (6) Amazon’s Rx. (7) Government struggling to manage health care.
Yellen Sees Rational Exuberance
(1) Group of 30 gabfest. (2) Yellen says valuations are normal in New Normal. (3) Yellen channeling Greenspan on valuation question. (4) Back to the ’90s: Long-term expected earnings growth estimates going up again led by Tech. (5) Trump’s election seems to have boosted LTEG on expectations of deregulation and tax cuts. (6) Meet John Taylor, who might be next Fed chair. (7) Taylor says rules beat discretion, which is prone to chaos. (8) Rules may not rule without some discretion if Taylor rules. (9) For Fed watchers: Anybody but Taylor, please!
Addictions
(1) Global monetary conditions remain bullish. (2) Forward consensus expected revenues growth rates up from a year ago. (3) China is world’s biggest debt abuser. (4) China’s “social financing” at record high, led by bank loans and supplemented with lots of shadowy money. (5) China’s M2 growing fast too. (6) Ben Bernanke has some advice for the Fed. (7) What if central banks really don’t control inflation at all? (8) Then their efforts to boost it will fail, and they will inflate asset prices trying to do so.
Bitdollars
(1) Global economy lifting all boats. (2) Consensus earnings expectations rising around the world. (3) Another happy canary chirping in Malaysia. (4) China’s imports and exports showing solid y/y gains. (5) US retail sales and CPI lift GDPNow to 2.7% for Q3. (6) Fed officials obsessed with solving the “lowflation” puzzle. (7) Fed’s doves cooing more loudly. (8) True confession by ex-Fed governor: Inflation model is broken. (9) Bernanke calls on Fed to overshoot inflation target. (10) Brainard voices by-the-way concerns about asset price melt-ups. (11) Melissa explains central bank backed cryptocurrencies. (12) Get ready for bitdollars.
2018 Is Coming
(1) Q3 earnings cut by hurricanes and by analysts doing what comes naturally. (2) Industry analysts expecting solid revenues growth in 2018, with higher profit margins also boosting earnings. (3) Catalonians want to secede from Spain. (4) Companies ready to say adios. (5) Spanish economic indicators are muy bueno across the board. (6) Spanish stocks remain relatively cheap despite separatist issue.
Blue Skies for Blue Angels
(1) Is low unemployment bad for stock returns? (2) An eternal disclaimer. (3) Might booming labor market with low inflation remain bullish for stocks? (4) Guess what? Unemployment always bottoms before recessions and bear markets. (5) MAPE showing stocks still fairly valued. (6) Nirvana continues for now. (7) Blue Angels flying into the wild blue yonder.
On a Winning Streak
(1) Germany and South Korea chirping a happy song. (2) South Korean exports soaring. (3) German new orders at record high. (4) Five reasons why the global economy is booming. (5) German domestic orders for consumer goods confirming that mass migration is boosting growth. (6) Go Global beating Stay Home in dollars more than in local currencies. (7) Will winning streak last for Emerging Markets?
FOMO & MAMU
(1) Deep in the heart of Texas. (2) From fiscal cliff to anxiety fatigue. (3) Nothing to fear but nothing to fear. (4) Mother of All Melt-Ups if Fear Of Missing Out takes hold. (5) It’s still Nirvana now, but raising odds of Melt-Up then Meltdown scenarios. (6) Templeton’s four seasons of a bull market. (7) No corrections during fourth (euphoria) phase so far. (8) Extreme greed readings. (9) Are SmallCaps frothy?
Gushing Over Global Growth
(1) Five reasons why global growth is so good. (2) Global Growth Barometer has a sunny disposition. (3) On the margin, global oil demand is rising a bit faster than supplies. (4) Three geopolitical hot spots for oil. (5) US frackers should be ordering more rigs soon. (6) Electric cars are heading our way. (7) Lots of big gains underneath surface of this year’s bull market. (8) Aerospace & Defense flying too high?
Morning Briefing 2017-10-04
A of this Morning Briefing is also available. (1) Crib sheet for unwritten plan. (2) Campaign promises vs. White House “framework.” (3) Hit to revenues offset by implicit elimination of state & local tax deduction. (4) There’s a new fourth tax rate to keep tax reform progressive. (5) Pass-throughs should still get a big windfall. (6) Corporate tax rate: 15% has been raised to non-negotiable 20%. (7) Mnuchin says it will pay for itself. (8) Repatriation story just got more complicated. (9) Border tax is dead.
Thanks a Trillion!
(1) Several explanations for why the global economy is doing so well. (2) Central bankers remain on easing streak. (3) Benefit of lower oil prices flowing through now. (4) Immigration usually boosts growth. (5) Big positive wealth effect from global bull market in stocks. (6) Trillions here and there adding up to serious money. (7) Happy canaries in S. Korean coal mines. (8) Eurozone economic sentiment auguring better growth. (9) US M-PMI and key components all above 60.0. (10) Forward revenues and earnings rebounding smartly overseas.
Thanks a Million!
(1) While Buffett’s ratio is sounding the alarm, Buffett is sounding bullish. (2) Shorting America has been a loser’s game. (3) We can all be millionaires in 100 years. (4) CAGR is the 8th wonder of the world, though less so after inflation. (5) Adjusted for inflation, DJIA provides 3% CAGR, a bit less than S&P 500’s real earnings yield. (6) Beware the front-cover curse. (7) Trump’s tax plan revives animal spirits in the stock market, especially among SmallCaps. (8) Hard to find devils in Trump plan without any details. (9) Both fundamentals and technicals are bullish for stocks. (10) Movie review: “American Made” (+ + +).
Good Rotations
(1) Remember risk-off/risk-on? (2) Follow the changing leaders. (3) Vertical integration creating more competition in semiconductor space. (4) Everybody wants to make designer chips. (5) GPUs for AR, VR, and AI. (6) Law of supply and demand pushing up some wages. (7) Fresh air in Beijing during mid-October. (8) China’s strong man will get five more years in office, guaranteed. (9) China’s economy continues to roll along thanks to lots of debt, which might be restructured into equities.
Keep On Trucking
(1) The Fed cops. (2) What’s the speed limit? (3) The 2% stall speed is the cruising speed. (4) Private-sector GDP cruising along at 3%. (5) Productivity and working-age population cruising at crawl speed. (6) Underwhelming potential. (7) Truck traffic is barreling down the highway. (8) West Coast ports reporting record activity. (9) Intermodel railcar loadings chugging along. (10) Railcar loadings of motor vehicles continue to weaken. (11) The eternal chancellor wins again. Now what?
Inflation Mystery Solved
(1) Janet in Wonderland. (2) There’s no Phillips curve on the other side of the looking glass. (3) BIS chief economist Claudio Borio’s speech affirms my 40 years of work on disinflation. (4) Fed’s top economist says that inflation is a mystery. (5) Borio tells central bankers to stop targeting inflation. (6) Inflation isn’t just a monetary phenomenon. (7) Real forces related to globalization, technology, and demography can drive inflation too. (8) Global slack matters. (9) Technology disrupts pricing power. (10) What if the neutral real interest rate does not exist? (11) Dog barking at a mirror. (12) Bottom line: Raise interest rates to stop borrowing binges, stock market melt-ups, and a debt trap.
Bulls Flying With Doves
(1) Hyperbole for our times. (2) A bull for all seasons. (3) Serious money. (4) Slicing and dicing valuation some more. (5) Stocks overvalued based on ratios of market cap to GNP and to sales. (6) Stocks fairly valued based on inflation-adjusted earnings yields using S&P and NIPA data. (7) Tobin’s q isn’t bearish so far. (8) Yellen’s fashion statement. (9) Yellen lets it slip: She is (probably) leaving. (10) Fed on course of gradual monetary normalization with or without Yellen. (11) Movie review: “Viceroy’s House” (+ + +).
Chips & Bricks
(1) Here’s to you, Mrs. Robinson. (2) Semi whisper. (3) There’s a GPU for that. (4) Nvidia is winning the games. (5) The brain behind AI. (6) The chip behind the wheel. (7) Beyond beds, baths, and toys. (7) Do you want a side of mortar with that online order?
A Trillion Here, A Trillion There
(1) Dirksen’s “real money” was in billions. Now it’s trillions. (2) Policy-making trillionaires remain bullish for asset prices. (3) Less bang per buck, euro, yen, and yuan. (4) China’s monetary extravaganza. (5) US government redistributing lots of money. (6) Three central bank amigos on major liquidity binge. (7) Stocks on central bank high. (8) Bye-bye, buybacks? (9) The corporate finance buyback model favors more buybacks. (10) Bond borrowing binge continues. (11) More upside for stock valuations based on corporate bond yield.
On the Margins
(1) Contrary to the bearish script. (2) Still waiting for the first part of the boom-bust cycle. (3) S&P 500 profit margin at record high. (4) NIPA profit margin is down, but a long way from reverting to the mean. (5) The Trauma of 2008 explains a lot. (6) Containing costs remains a top priority. (7) Disruptive technologies posing existential threats. (8) Forward profit margins of S&P 500 and its 11 sectors all exceed S&P 400/600 comparable series. (9) It’s good to be big. (10). It’s good to have a global business.