The Morning Call--Ready for 4200?

The Morning Call

 

4/18/23

 

The Market

         

    Technical

 

            Monday in the charts.

            https://www.zerohedge.com/markets/shorts-steamrolled-late-day-squeeze-sends-stocks-session-high-vix-plummets

 

Ready for 4200?

https://www.zerohedge.com/the-market-ear/spx-ready-4200-attack

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

March housing starts fell 0.8% versus forecasts of -1.3%; March building permits declined 8.8% versus -6.0%.

                          https://www.zerohedge.com/personal-finance/single-family-building-permits-jump-renter-nation-fades

 

                          The April housing index came in at 45 versus predictions of 44.

                          https://www.advisorperspectives.com/dshort/updates/2023/04/17/nahb-housing-market-index-builders-remain-cautiously-optimistic

                                                             

                        International

                                

  The February UK unemployment rate was 3.8% versus   consensus of 3.7%; February (3month YoY) average earnings were up 6.6% versus 6.2%.

 

  Q1 YoY Chinese GDP grew 4.5% versus estimates of 4.0%; March YoY industrial production was up 3.9% versus 4.0%; March YoY retail sales were up 10.6% versus 7.4%; March YoY fixed asset investment was up 5.2% versus +5.7%.

  https://www.zerohedge.com/markets/recovery-track-china-economy-rebounds-strongly-45-gdp-jump-q1

 

  The April EU economic sentiment index was 6.4 versus expectations of 13.0; the April German economic sentiment index was 4.1 versus 15.3.

 

                        Other

 

              Update on the weekly macro indicators.

              https://econbrowser.com/archives/2023/04/weekly-macro-indicators-through-april-8

 

              More on de-dollarization.

              https://www.zerohedge.com/economics/ooh-lula-la-brazil-wants-dedollarize-too

 

The Fed

 

  The Fed is bankrupt.

  https://www.aier.org/article/the-fed-is-bankrupt/

 

              The yield curve is saying that there is little upside to another rate hike.

              https://www.zerohedge.com/markets/you-cant-fight-curve-rates-curve-saying-theres-little-upside-another-fed-hike

 

            Fiscal Policy

 

The US budget deficit is soaring again.  Keep in mind the Reinhard/Rogoff studies that indicated that a debt to GDP ratio over approximately 90% negatively impacts economic growth.  The US is now at 120%.

https://www.zerohedge.com/economics/us-budget-deficit-quietly-soaring-again-and-its-about-get-much-worse-heres-why

 

            Recession

 

              Recession odds jump as the Fed crushes consumers.

              https://www.advisorperspectives.com/commentaries/2023/04/17/recession-odds-jump-as-the-fed-crushes-consumers

 

            The Banking System

 

              Forget more banking regulation.  Just let moral hazard do its work.

              https://www.realclearmarkets.com/articles/2023/04/17/investors_may_fly_to_cash_but_the_economy_cannot_893953.html

 

Geopolitics

 

  Game theory analysis of China blockading Taiwan.

  https://twitter.com/dalperovitch/status/1646934049036836884?s=61&t=nKYsNuoIWmAiTKUo2TkVqg

 

    Bottom line

 

            Buffett looking overseas.

            https://www.wealthmanagement.com/equities/buffett-shows-investors-how-broaden-their-horizons

 

    News on Stocks in Our Portfolios

 

Johnson & Johnson press release (NYSE:JNJ): Q1 Non-GAAP EPS of $2.68 beats by $0.18.

Revenue of $24.7B (+5.6% Y/Y) beats by $1.09B.

 

Johnson & Johnson (NYSE:JNJ) declares $1.19/share quarterly dividend, 5.3% increase from prior dividend of $1.13.

 

What I am reading today

 

            Tuesday morning humor.

            https://www.powerlineblog.com/archives/2023/04/this-buds-not-for-you.php

 

 

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