The Morning Call--How much longer can the Chinese zero Covid policy go on?

The Morning Call

 

5/17/22

 

 

The Market

         

    Technical

 

            Monday in the charts.

            https://www.zerohedge.com/markets/growth-scare-sparks-stock-chaos-bonds-bullion-jump-bitcoin-buck-dump

 

            The strong dollar is causing economic problems for the rest of the world.

            https://www.advisorperspectives.com/articles/2022/05/16/dollars-strength-pushes-world-economy-deeper-into-slowdown

 

            Can we be close to a trough?

            https://www.zerohedge.com/the-market-ear/beenhuge

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

April retail sales grew 0.9%, in line; ex autos, they were up 0.1% versus -0.2%.

 

                        International

 

The March UK unemployment rate was 3.7% versus projections of 3.8%; March average earnings rose 7.0% versus +5.4%.

 

The first estimate of Q2 EU GDP growth was +0.3% versus consensus of +0.2%

 

 

                        Other

 

                          May survey of professional forecasters.

                          https://econbrowser.com/archives/2022/05/survey-of-professional-forecasters-may-survey-results-in-perspective

 

                          Goldman sees a slowdown in consumer spending.

                          https://finance.yahoo.com/news/goldman-sachs-economist-slowdown-consumer-spending-151957462.html

 

                          Update on four high frequency economic indicators.

                          https://www.calculatedriskblog.com/2022/05/four-high-frequency-indicators-for_16.html

 

                          Housing inventory up 1.5% YoY.

                          https://www.calculatedriskblog.com/2022/05/housing-inventory-may-16th-update.html

 

            The Fed

 

              Too late for a soft landing.

              https://www.zerohedge.com/economics/lacalle-powells-soft-landing-impossible

 

              The Fed isn’t going to blow up anything.

              https://www.zerohedge.com/markets/fed-fuct

 

            Inflation

 

              Wheat prices up 6% following India’s export ban.

              https://www.ft.com/content/226f3f09-33ff-40c8-b439-08a36c515aba

 

            Geopolitics

 

              On Russian strategy in Ukraine.

              https://www.zerohedge.com/geopolitical/escobar-death-thousand-cuts-where-wests-ukraine-strategy

 

            China

 

              How much longer can China’s zero Covid policy go on?

              https://www.bloomberg.com/news/articles/2022-05-16/china-s-economy-contracts-sharply-as-covid-zero-curbs-output?srnd=premium&sref=loFkkPMQ

 

     Bottom line

 

            Lessons from the 2022 tech collapse.

            https://www.morningstar.com/articles/1094252/lessons-from-2022s-tech-stock-collapse

 

            Your worst enemy as an investor.

            https://www.evidenceinvestor.com/your-chief-problem-and-worst-enemy-as-an-investor/

 

            More on valuations.

            https://www.linkedin.com/feed/hashtag/?keywords=stockmarket

 

            Debt levels haven’t shrunk.

            https://www.zerohedge.com/markets/debt-piles-havent-shrunk-socgen-warns-bear-market-will-lead-fresh-corp-leverage-concerns

 

    News on Stocks in Our Portfolios

 

Home Depot press release (NYSE:HD): Q1 GAAP EPS of $4.09 beats by $0.39.

Revenue of $38.91B (+3.8% Y/Y) beats by $2.13B.

 

What I am reading today

 

           

                        Infant formula and price controls.

            https://marginalrevolution.com/marginalrevolution/2022/05/infant-formula-price-controls-and-the-misallocation-of-resources.html

 

The image of the Milky Way’s Black Hole.

https://www.quantamagazine.org/black-hole-image-reveals-sagittarius-a-20220512/

 

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.