The Morning Call--Nobody knows what is happening

The Morning Call

 

8/25/23

 

The Market

         

    Technical

 

            Thursday in the charts.

            https://www.zerohedge.com/markets/stocks-plunge-nvidia-closes-barely-green-markets-sell-news

               

            S&P head and shoulders?

            https://www.zerohedge.com/the-market-ear/spx-and-hs

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

The August Kansas City Fed manufacturing index came in at 12 versus forecasts of -15.

 

                        International

 

The final Q2 German GDP growth rate was 0%, in line; the August business climate index was 85.7 versus 86.7; the August current conditions index was 89 versus 90.

 

The August YoY Japanese CPI was 2.9% versus estimates of 3.2%; YoY core CPI was 2.8% versus 2.9%.

 

                        Other

                       

                          LA port inbound traffic went down sharply in July.

                          https://www.calculatedriskblog.com/2023/08/la-port-inbound-traffic-down-sharply.html

 

            The Fed

 

              Macro illusions.

              https://marginalrevolution.com/marginalrevolution/2023/08/macro-illusions-which-ones-are-you-suffering-under.html

 

                  M2 continues to shrink.

              http://scottgrannis.blogspot.com/2023/08/the-most-important-variable-that-wont.html

               

              Nobody knows what is happening.

    https://www.reuters.com/business/fed-coming-up-snake-eyes-its-battle-with-spend-happy-consumers-2023-08-24/?utm_campaign=What%20I%20Am%20Reading&utm_medium=email&_hsmi=271585583&_hsenc=p2ANqtz-93P5s1OjOVygEyCi07kQySIGbKvsoFzvMrV28_b2bVoq4bTUjswx7OJYz-qV-bhEQmyfz-p0fsC4svtgYyaisngHNc9Q&utm_content=271585583&utm_source=hs_email

 

             Part 2.

   https://www.wsj.com/articles/return-of-high-interest-rates-central-banking-federal-reserve-u-s-economy-290da4d0?mod=hp_opin_pos_6&utm_campaign=What%20I%20Am%20Reading&utm_medium=email&_hsmi=271585583&_hsenc=p2ANqtz-_sK896LwBTAuWJV-6a12-5eW9naGI2R3TZJyVRnIFWaOZRRajcBszcpd5hZelP3uqxwHbqoyAvuJR1-xKhmBcj_pTZhg&utm_content=271585583&utm_source=hs_email#cxrecs_s

 

             Part 3.

             https://www.axios.com/2023/08/24/recession-indicator-us-economy-downturn

 

 

           Fiscal Policy

 

             FEMA officials enjoy $1000/night accommodations in Maui as fire victims suffer.

             https://pjmedia.com/news-and-politics/catherinesalgado/2023/08/23/fema-officials-enjoy-luxury-hotels-as-displaced-maui-residents-need-aid-n1721414

 

            Recession

 

              The latest Q3 GDP nowcast.

              https://econbrowser.com/archives/2023/08/q3-gdpnow-at-5-9-saar

 

            China

 

              China’s crisis of confidence in six charts.

  https://www.wsj.com/world/china/chinas-crisis-of-confidence-in-six-charts-8fd36f9f?mod=hp_lead_pos3&utm_campaign=What%20I%20Am%20Reading&utm_medium=email&_hsmi=271585583&_hsenc=p2ANqtz-_X7N7-HGDib5S52bwfY6A6zQ4D3_BSsAOwCdRVPBUXEvhmImOKJQpq5HVXmx_2qF9oqOo-R0ckMvSEmYS_G3AyO7w9-A&utm_content=271585583&utm_source=hs_email

 

     Bottom line

 

I have argued frequently in these pages that two of the negative consequences of the irresponsible management of monetary and fiscal policies was the misallocation and mispricing of assets and acting as an accelerant to income inequality---of which stock buybacks are part and parcel.   This author addresses that issue.  While he espouses some leftist ideologies in his comments and analysis, he nonetheless makes some very good points and a decent case for the need to reform the tax code to reduce the financial incentive for corporate executives to personally benefit from stock buybacks.

            https://www.nakedcapitalism.com/2023/08/the-scourge-of-corporate-financialization-income-inequity-employment-instability-productive-fragility.html

 

    News on Stocks in Our Portfolios

 

Altria (NYSE:MO) declares $0.98/share quarterly dividend, 4.3% increase from prior dividend of $0.94.

What I am reading today

 

            There is a way to get healthier without going to the gym.

            https://www.npr.org/sections/health-shots/2023/07/22/1189303227/neat-fitness-non-exercise-activity-thermogenesis

 

 

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