The Morning Call--T'is the season to be jolly

The Morning Call

12/12/17

The Market

         

    Technical

            The indices (DJIA 24386, S&P 2659) had a good day, though volume was flat and breadth was mixed.  The bottom line remains that both of the Averages continue to trade above their 100 and 200 day moving averages and are in uptrends across all time frames---with the assumption being that stock prices are going higher.

           

The VIX (9.3) fell 2 ½ %, closing below the lower boundary of its long term trading range for a second day, below its 100 and 200 day moving averages (both resistance).  It is again nearing its July low (8.8) 

            https://www.seeitmarket.com/has-global-stock-market-volatility-bottomed-17571/

The long Treasury was down fractionally, ending above its 100 and 200 day moving averages and the lower boundaries of a very short term uptrend, its short term trading range and long term uptrend.   So bond investors still don’t appear to be concerned about a Fed rate hike later this week.

The dollar was unchanged, above its 100 day moving average (now support), right on the upper boundary of a very short term downtrend but below its 200 day moving average (now resistance).

            Gold was down ½ %, continuing its poor performance.  It is below its 100 and 200 day moving averages and reset its short term trend from up to a trading range.  GLD investors are apparently more concerned about a rate rise than the bond guys. 

            http://www.zerohedge.com/news/2017-12-12/bitcoin-really-stealing-demand-gold-here-goldmans-answer

Bottom line: long term, the indices remain strong viz a viz their moving averages and uptrends across all timeframes. Short term, they are above the resistance level marked by their August highs, meaning that there is no resistance between current price levels and the upper boundaries of the Averages long term uptrends. The technical assumption has to be that stocks are going higher.  If you own enough cash to sleep at night, lay back and enjoy it.

           

Trading in UUP, GLD and TLT are back out of sync with themselves (sluggish economy, weak interest rates) and with the VIX and stocks.  I remain confused and uncomfortable with the overall technical picture.

                       

    Fundamental

       Headlines

            Yesterday was quiet on most fronts: no economic data in the US or abroad.  Investors spent the day (1) getting jiggy with bitcoin, (2) anticipating a grand exit by Yellen on Wednesday and (3) ignoring more accusations of sexual harassment by Trump.  No wonder stocks were up.

            I have linked below to a number of articles on relevant issues: bit coin, Brexit, a slowdown in volume of containerized shipping.

            This from two big supporters of tax reform (medium):

            https://nypost.com/2017/12/08/republicans-tax-plan-takes-a-quirky-swipe-at-the-little-guys/

            Bottom line: animal spirits are high partly as a function of the seasonal bias and partly in anticipation of upbeat news on tax reform and infrastructure spending.  The question is, assuming the successful passage of both, what will be the impact on corporate earnings and how those earnings are valued?  In my opinion, the most optimistic investment scenario possible is more than adequately reflected at current price levels.  Be careful.

            http://www.zerohedge.com/news/2017-12-11/exit-problem

       Investing for Survival

   

            Three unexpected retirement costs.

            https://www.usatoday.com/story/money/personalfinance/retirement/2017/12/08/3-unexpected-retirement-costs-can-shake-up-your-finances/936462001/

    News on Stocks in Our Portfolios

 

           

Economics

   This Week’s Data

            The November small business optimism index came in at 107.5 versus expectations of 104.4.

            http://www.calculatedriskblog.com/2017/12/nfib-small-business-optimism-index-near.html

            November PPI was up 0.4% versus estimates of up 0.3%; ex food and energy, it was up 0.3% versus forecasts of up 0.2%.

   Other

            Is softness in the global containerized shipping market a warning sign? (medium):

            http://www.zerohedge.com/news/2017-12-11/warning-worlds-biggest-shipping-line-outlook-world-trade

            The math of unwinding the Fed’s balance sheet (medium):

            http://www.zerohedge.com/news/2017-12-11/abracadabra-uncovering-feds-magnificent-fraud

            Some analysis of the Brexit ‘break through’ (medium):

            https://www.nakedcapitalism.com/2017/12/david-davis-points-out-brexit-breakthrough-isnt-binding-as-draft-european-council-statement-tightens-the-screws.html

            China’s plan to combat US tax reform (medium):

            http://www.zerohedge.com/news/2017-12-11/%E2%80%9Cwe%E2%80%99ll-have-tough-battles-china-unveils-plan-combat-trump-tax-reform

            Is the World Trade Organization worth effective? (medium):

            http://www.zerohedge.com/news/2017-12-11/wto-useless-trade-useful-state

            Today’s bitcoin entries:

            https://www.pragcap.com/elasticity-money-feature-not-bug/

            http://www.zerohedge.com/news/2017-12-11/coinbase-breaks-buys-sells-temporarily-disabled

                http://www.zerohedge.com/news/2017-12-11/its-mania-phase-securities-regulator-warns-mortgages-are-being-taken-out-buy-bitcoin

Politics

  Domestic

  International War Against Radical Islam

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

Monday Morning Chartology

The Morning Call

12/11/17

The Market

         

    Technical

            Here is even a longer term chart than I presented last week; but the point is the same.  The S&P is on a sizz.  The assumption has to be that the upward momentum will continue, though clearly it is nearing a powerful resistance at the upper boundary of its long term uptrend.

            Despite some volatility, the long Treasury continues to move to the upside.  It remains above both moving averages and the lower boundaries of a very short term uptrend, a short term trading range and a long term uptrend.  In other words, the weak long term rates or safety trade is holding in the face of the FOMC meeting this week in which it is expected to raise rates.

            http://www.zerohedge.com/news/2017-12-10/bank-america-weve-seen-movie-it-ends-recession

            The dollar is now above its 100 day moving average and is on the cusp of challenging its short term downtrend.  If successful, it would point to a stronger economy/higher interest rates or a safety trade.

            GLD had a punk week, resetting its short term uptrend to a trading range and reverting its 100 day moving average to resistance.  That tends to indicate higher interest rates and/or a retreat from a safety trade.

            While equity prices rose last week, the VIX was pounded to greater extent than commensurate with the stock price advance.  Indeed, the VIX is closing in on another challenge of its July lows.  Something seems off.

            Bottom line: the disparate performance of the indicators keeps me very uneasy with the technical picture given the seeming inconsistency of the thinking/rationale of investors in various markets.

    Fundamental

       Headlines

The data last week was pretty evenly matched; although the primary indicators were a solid plus.  The call is a plus.   Score: in the last 113 weeks, thirty-six were positive, fifty-six negative and twenty neutral.  However, as I noted last week, the recent trend has been upbeat which I attribute to the Trump regulatory agenda, the increasing growth in the EU economy and a rising level of consumer and business sentiment as congress continues to make progress on the tax bill.

            Overseas, there was not many stats out of the EU while those from China were mixed and the Japanese continues its positive trend.  That really doesn’t change the global economic picture: EU a plus, China a negative, Japan attempting to demonstrate some consistent growth.

            IMF stress test of Chinese banks reveals serious shortage of equity capital (medium):

            http://www.zerohedge.com/news/2017-12-07/imf-stress-test-finds-280-billion-black-hole-chinese-banks-capital

            The ruling class kept us busy last week.

(1)   the senate passed its version of tax reform.  The GOP is now driving to the hoop for passage of a tax bill.  I suspect the odds are for success; though at the moment, the terms of the bill are still up for question as political process evolves.

Whatever the details, it still appears that

[a] corporations will get the lion’s share of tax reductions---which {i} I don’t believe is fair and {ii} they are receiving this largess on the thesis that they will spend the extra cash from tax savings on investment and creating jobs.   There is only one thing wrong with that notion---corporations already have a lot of free cash flow and have to date used it buyback stock and grow their dividends.  While they have every right to spend their money as they see fit, I fail to see how lowering their tax rate, thereby increasing their cash flow will alter their decision on how to spend cash.

[b] the legislation will still add $1.5 trillion to the national debt.  I have beat this horse to death; but the bottom line is that at the US current level of debt, adding another $1.5 trillion will be do more to hinder economic growth than increase it.

That said, the big unknown is the psychological effect a tax bill, however, flawed, will have on corporate investment decisions.  To be sure, we witnessed a brief surge in economic activity immediately following the Donald’s election, only to peter out with the realization that one man wasn’t going to change how business got done in DC.  Will this time be different?  Certainly, an initial spurt in economic activity is easy to imagine.  The question is, is it sustainable?  That is probably the biggest issue impacting the economy in 2018.

(2)   Congress managed to extent the spending authority of the government by another two weeks.  While that is not exactly a moment for jubilation, it does indicate that the GOP and dems can reach some kind of agreement in order to avoid a government shutdown.  True, the same problem will again come to a head shortly; but with all the negotiations occurring on multiple fronts, hopefully, our governing class can come up with a compromise that keeps the government open.

On the other hand, keeping the government in business at a negative run rate [deficit] at a time of unsustainable national debt isn’t exactly a victory to cheer about.

(3)   the Donald has already started talking about an infrastructure bill.  We have no idea what his proposal will contain, but here is what I am watching for: [a] how big will it be.  Early rumors have it a $200 billion; and that is relatively modest, [b]what projects will it entail?  More Obama ‘shovel ready’ imaginary spending or real ventures that improve America and produce jobs?

One other piece of overseas news worth mentioning: the EU and UK inched closer to agreement on Brexit.  This is good news and lessens any risks that would be associated with any economic disruptions that could result from a contentious breakup.

            http://www.zerohedge.com/news/2017-12-08/uk-and-eu-reach-agreement-taking-brexit-talks-next-phase-irish-border-questions-ling

Bottom line: the economic data continues to improve; and I upgraded our 2018 growth forecast to reflect that.  To be sure, it wasn’t wildly optimistic but it did portray an economy emerging from a near year long bout with stagnation.  Further, it may be given an additional boost depending on the outcome of the tax bill and Trump’s infrastructure spending plans.  At the moment, I am not all that hopeful regarding the former and I simply don’t know enough to have any opinion of the latter. 

That said, I think that the big unknown is not what the terms of the aforementioned legislation may be but how businesses and consumers react to it.  So far, everybody is jiggy.  However, the rubber has yet to meet the road.

            http://www.zerohedge.com/news/2017-12-10/no-risk-recession

            Earnings may not matter but dividends do (as in the present value of future cash flows):

            http://blog.knowledgeleaderscapital.com/?p=13778

       Investing for Survival

   

            The death of equities, redux

            http://awealthofcommonsense.com/2017/12/a-death-of-equities-redux/

    News on Stocks in Our Portfolios

 

           

Economics

   This Week’s Data

           

   Other

            The latest thoughts from Bill Gross (medium):

            http://www.zerohedge.com/news/2017-12-07/bill-gross-financial-system-we-know-it-can-be-risk

                A pentagon audit---it is about time, if they really do it (medium):

            http://www.zerohedge.com/news/2017-12-10/pentagon-undergo-first-ever-audit-after-decades-sloppy-accounting-and-missing-trilli

               

                Stockman on employment and wages/income (medium):

            http://www.zerohedge.com/news/2017-12-09/david-stockman-lashes-out-mainstream-medias-peak-fantasy-time

               
            Since bitcoin is now on everyone’s lips with few understanding it, I am going to start making regular entries of the subject.  Here is the original paper done by the developer of bitcoin.  Don’t worry, it is not that technical:

            https://bitcoin.org/bitcoin.pdf

Today’s entries:

http://www.zerohedge.com/news/2017-12-10/cboe-website-crashes-futures-trading-begins-bitcoin-price-squeezed-10-higher

            http://www.zerohedge.com/news/2017-12-08/bitcoin-has-whale-problem-1000-investors-control-nearly-half-market

Politics

  Domestic

  International War Against Radical Islam

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

The Morning Call

The Morning Call

12/5/17

My diagnosis has gone from viral infection to pneumonia.  I am confined to bed.  Back when I can

The Market

         

    Technical

            The indices (DJIA 24290, S&P 2639) had another schizophrenic day, opening up big in initial trading but giving much of that gain for the remainder of the day including a negative close for the S&P.  Volume was up; breadth mixed.  The bottom line remains that both of the Averages continue to trade above their 100 and 200 day moving averages and are in uptrends across all time frames---with the assumption being that stock prices are going higher.

           

The VIX (11.7) was up another 2 ¾%, closing above the lower boundary of its long term trading range, above its 200 day moving average (reverting to support) and above its 100 day moving average (now support). 

            http://www.zerohedge.com/news/2017-12-04/vix-options-volume-hits-record-high-equity-correlation-flashes-red

The long Treasury was up, ending above it 100 and 200 day moving averages and the lower boundaries of a very short term uptrend, its short term trading range and long term uptrend.  

https://ftalphaville.ft.com/2017/12/04/2196387/dont-worry-about-the-flattening-just-yet/

The dollar rose, finishing right on its 100 day moving averages (now support) and the upper boundary of a very short term downtrend but within a short term downtrend and below its 200 day moving average (now resistance).

            Gold was off, closing below its 100 day moving average---continuing its see saw pattern around this moving average.  It remained above its 200 moving average (now support) and in a short term uptrend. 

Bottom line: long term, the indices remain strong viz a viz their moving averages and uptrends across all timeframes. Short term, they are above the resistance level marked by their August highs, meaning that there is no resistance between current price levels and the upper boundaries of the Averages long term uptrends. The technical assumption has to be that stocks are going higher.  If you own enough cash to sleep at night, lay back and enjoy it.

           

Trading in UUP, GLD and TLT are back out of sync with themselves (sluggish economy, weak interest rates) and with the VIX and stocks.  I remain confused and uncomfortable with the overall technical picture.

           

    Fundamental

       Headlines

            One US datapoint yesterday: October factory orders were down less than expected.  Nothing overseas.

            Investor focus was on the tax bill getting passed.

            More feedback on the senate’s piece of s**t tax bill.

            http://thereformedbroker.com/2017/12/02/forgotten-again/

            And Ed Yardini on the corporate tax cut (medium):

            http://blog.yardeni.com/2017/11/corporate-taxes-facts-vs-fiction.html

            But a government shutdown (12/8 drop dead date) is now starting to draw attention (medium):

            http://www.zerohedge.com/news/2017-12-04/schumer-pelosi-will-meet-trump-negotiate-government-funding-one-day-deadline

            Bottom line: the good news is that the economy is improving.  The bad news, however, is that the negative consequences of an inefficient tax bill and yet another hike in the national debt will, in my opinion, more than offset of the benefits of the current upturn in cyclical growth.

            Update on valuations (medium):

            https://www.advisorperspectives.com/dshort/updates/2017/12/04/the-q-ratio-and-market-valuation-november-update

            https://www.advisorperspectives.com/dshort/updates/2017/12/04/is-the-stock-market-cheap

                https://www.advisorperspectives.com/dshort/updates/2017/12/04/regression-to-trend-another-look-at-long-term-market-performance

       Investing for Survival

   

            Notes from an unwelcome future.

            http://alephblog.com/2017/11/28/notes-from-an-unwelcome-future-part-1/

    News on Stocks in Our Portfolios

 

           

Economics

   This Week’s Data

            October factory orders fell 0.1% versus estimates of -0.4%.

   Other

            Government debt now surpasses household debt (medium):

            http://www.zerohedge.com/news/2017-12-04/first-time-modern-history-us-government-debt-will-surpass-household-debt

Politics

  Domestic

  International War Against Radical Islam

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

Monday Morning Chartology

The Morning Call

12/4/17

The Market

         

    Technical

            I thought that I would put in a longer term S&P chart just to provide some perspective on the duration and order of magnitude of the current run.  Of course, it really doesn’t change the bottom line.  The indices are in uptrends across all technical factors.  The presumption has to be that this continues.

The long Treasury shook off the Wednesday/Thursday weakness, closing back above its 100 day moving average and the lower boundary of a very short term uptrend.  It continues to trade above its 200 day moving average and the lower boundaries of its short term trading range and its long term uptrend.  In other words, whatever doubts bond investors may have had about a weak economy/lower interest rate seems to have been assuaged but not the need for a safety trade.

            The dollar remains in negative trends viz a viz all our technical indicators, suggesting questions about an improving economy and the need for a safety trade.  (just the opposite of TLT).

            GLD continues to hold its short term uptrend; though it also seems unable to escape the gravitational pull of its 100 day moving average.  Of course, that moving average is trending up albeit at a slow pace; so I have to assume the trend will remain up with a leisurely bias, giving weak support to a weak economy/need for safety trade.

            The VIX once again couldn’t hold below the lower boundary of it long term trading range.  Meaning once it gets there, there are enough investors that believe that it is not properly reflecting the potential risks in the Market.  At the least, it will serve to slow the rate of advance in equity prices.

            http://www.zerohedge.com/news/2017-12-03/alan-fournier-pensions-funds-are-shorting-vol-because-theyre-starved-yield

   Fundamental

       Headlines

            There was a lot of data released last week and while it was not overwhelmingly positive or negative, in sum it was weighed to the upbeat side. Further, the primary indicators were almost positive.  So the call is easy.  Score: in the last 112 weeks, thirty-five were positive, fifty-six negative and twenty neutral.  More important, this continues the recent trend of roughly two months during which the economy is on a clear path to improvement.  I attribute this to multiple sources: the Trump regulatory agenda, the increasing growth in the EU economy and a rising level of consumer and business sentiment as congress continues to make progress on the tax bill.

            As you know, I don’t have a lot of positive things to say about the latter; and I haven’t changed my opinion one bit.  But as long as the electorate/investors consider this a plus and that translates into economic decisions that increase the level of economic activity, it is a positive, at least in the short term

            Early Saturday morning, the senate passed its tax bill.  Here is what’s in it:

            http://www.zerohedge.com/news/2017-12-03/heres-whats-it-goldman-explains-all-you-need-know-about-current-state-tax-reform

            And here is David Stockman’s analysis (medium):

            http://www.zerohedge.com/news/2017-12-01/stockman-debt-taxes-growth-and-gop-con-job

            Bottom line: at long last, the economy seems to be improving---not returning to it historical secular growth rate---but improving.  Hopefully that will provide a base for the middle class, when the investor class realizes that it owns assets that are so grossly overvalued, no amount of economic growth is going to get the net present value of future cash flows remotely close to current prices.  Be sure that you have enough cash to sleep at night.

       Investing for Survival

   

            Six things that you are told about retirement.

            https://www.usatoday.com/story/money/personalfinance/retirement/2017/11/26/top-6-things-no-one-tells-you-about-retiring/107865338

/                      

    News on Stocks in Our Portfolios

 

           

Economics

   This Week’s Data

   Other

Politics

  Domestic

  International War Against Radical Islam

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

The Morning Call__Which group of morons are you going to believe?

The Morning Call

12/1/17

Fellow fun lovers. I am down with a nasty viral infection; so today will short and sweet and nothing tomorrow.  Hopefully I am back on track Monday.

The Market

         

    Technical

            The technical picture became a bit more confused yesterday.  Certainly not for the stock crowd though breadth continues to be weaker than the pin actin suggests.  The Treasury and GLD drifted lower (stronger economy/higher rates), while the dollar did the same (weaker economy/ lower rates).  Bottom line: the indices are technically strong and point to higher prices/stronger economy/higher rates.  Other indicators not so much so. 

            Overseas, the November Chinese manufacturing and nonmanufacturing PMI were ahead of forecasts while the final November EU manufacturing PMI was also higher than anticipated.

            Of course, at the top of everyone’s list is the senate tax reform bill.  However, there has been selective interpretation of related news events.  For instance, Senator John McCain said that he would support the bill.  The fans went wild, stock prices spiking. 

Then the senate’s joint committee on taxation, issued a report that said the proposed tax cuts would only generate $458 billion in increased revenue.  In other words, the $1.4 trillion in tax cuts would result in net addition to the deficit of $1 trillion.  Don’t get me wrong, I don’t have any more faith that one group of eggheads with their model are any more likely to be right than another group of eggheads with their model that said the tax cut would pay for themselves.   But that is the point, we are dependent on the outcome of a standoff between two groups of morons.   Well, needless to say that report did comport with the ‘everything is awesome’ narrative.  So investors took sides, decided that the senate committee was the bigger group of morons and therefore should be ignored.

            Here is where we are at this moment (medium):

            https://www.reuters.com/article/us-usa-tax/senate-grapples-with-tax-cut-plans-impact-on-u-s-deficit-idUSKBN1DV4K2

                Bottom line:  there is nothing in this senate to commend itself to taxpayers or investors.  We are now in the dreamweaver phase of the market, which can last longer than most rationale people would never expect.  Just be sure you have built your cash reserves.

    Fundamental

       Headlines

            Yesterday’s US data were upbeat: the November Chicago PMI and weekly jobless claims were better than expected; October personal income was above estimate, while personal spending and the PCE price indicator were in line

       Investing for Survival

   

            Busy dying.

            http://researchpuzzle.com/blog/2017/11/27/busy-dying/

    News on Stocks in Our Portfolios

 

           

Economics

   This Week’s Data

   Other

Politics

  Domestic

  International War Against Radical Islam

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

The Morning Call--The tax bill is junk legislation

The Morning Call

11/30/17

The Market

         

    Technical

            The indices (DJIA 23940, S&P 2626) had another mixed day (Dow up, S&P down, though not by much).  Volume was up and breadth improved.  The bottom line remains that both of the Averages continue to trade above their 100 and 200 day moving averages and are in uptrends across all time frames---with the assumption being that stock prices are going higher.

           

The VIX (10.7) was up another 6 ½%, closing above the lower boundary of its long term trading range, above its 200 day moving average (now resistance; if it remains there through the close next Monday, it will revert to support) and below its 100 day moving average (now resistance). 

The long Treasury spiked 1% on heavy volume, ending below the lower boundary of its newly developing very short term uptrend, right on its 100 day moving average (now support), above its 200 day moving average (now support) and above the lower boundaries of its short term trading range and long term uptrend.   This is the first crack since late October in the bond guys’ weak economy, tighter Fed narrative.

The dollar was down one cent, finishing below its 100 and 200 day moving averages (now resistance) and solidly within a short term downtrend and within a developing very short term downtrend---no crack here.

            Gold was off ½ %, though it remained above its 100 day moving average for the third day, above its 200 moving average (now support) and in a short term uptrend.  GLD moved in sync with TLT.

            http://www.zerohedge.com/news/2017-11-29/gold-slammed-massive-volume-key-technical-support-gdp-beat

Bottom line: hasn’t changed---long term, the indices remain strong viz a viz their moving averages and uptrends across all timeframes. Short term, they are above the resistance level marked by their August highs, meaning that there is no resistance between current price levels and the upper boundaries of the Averages long term uptrends. The technical assumption has to be that stocks are going higher.  If you own enough cash to sleep at night, lay back and enjoy it.

           

Trading in UUP, GLD and TLT are back out of sync with themselves (sluggish economy, weak interest rates) and with the VIX and stocks.  I remain confused and uncomfortable with the overall technical picture.

           

            This is not normal (short):

            http://theirrelevantinvestor.com/2017/11/28/this-is-not-normal/

    Fundamental

       Headlines

            Yesterday’s economic data continued its winning way.  Revised third quarter GDP was reported up 3.3% which was in line but an improvement from the prior reading; corporate profits also came in above its previous report, October pending home sales were above estimates and while weekly mortgage applications declined, the more important purchase applications were up.  Overseas, nothing.

           

            ***overnight, the November Chinese manufacturing and non-manufacturing PMI’s were ahead of estimates; November EU inflation was below.

            Yellen testified before congress for the last time, leaving a body of work that will surely be quoted often in the future.  Her tenor during the question and answer session did not change materially from that in her prepared remarks (which I linked to yesterday).

            The Fed released its latest Beige Book.  It was not quite as buoyant in tone as I had expected.  Still it pictured progress (medium):

            http://www.zerohedge.com/news/2017-11-29/best-beige-book-anecdotes-its-no-longer-possible-build-starter-home-under-200k-cleve

            The senate continues to work to put together a tax proposal that is better characterized by junk legislation than anything that addresses a simpler, fairer or economically stimulative reform.

            This comment on the senate bill from a lion in our industry---Jack Vogel (short and today’s must read):

                http://thereformedbroker.com/2017/11/29/a-moral-abomination-saint-jack-weighs-in-on-tax-proposal/

            The bottom line: I believe that the unwind of the gross mispricing and misallocation of assets will not end well.  I just don’t know what the trigger event is.  The GOP tax circle jerk is worse than nothing except for its political implications.  In my opinion, it will not lead to economic growth; but it will lead to higher debt and an additional constraint on the economy; it will lead to more stock buybacks and increased dividends none of which will create jobs or raise tax revenues.  When the electorate figures this all out, there will likely be hell by the GOP.

       Investing for Survival

   

            Expert judgment.

            http://awealthofcommonsense.com/2017/11/expert-judgment-or-lack-thereof/

    News on Stocks in Our Portfolios

 

           

Donaldson (NYSE:DCI): Q1 EPS of $0.46 beats by $0.04.

Revenue of $644.8M (+16.6% Y/Y) beats by $44.73M.

Microsoft (NASDAQ:MSFT) declares $0.42/share quarterly dividend, in line with previous.

Economics

   This Week’s Data

            October pending home sales rose 3.5% versus expectations of up 1.0%.

            http://www.calculatedriskblog.com/2017/11/nar-pending-home-sales-index-increase.html

            Weekly jobless claims fell 2,000 versus estimates of being flat.

                https://www.advisorperspectives.com/dshort/updates/2017/11/30/weekly-unemployment-claims-down-2k

            October personal income rose 0.4% versus forecasts of +0.3%; personal spending was up 0.3%, in line; the PCE price indicator was up 0.2%, also in line.

   Other

            The latest from Jeffery Snider (medium):

            http://www.alhambrapartners.com/2017/11/22/durable-goods-only-about-halfway-to-real-reflation/

            The latest on Brexit (medium):

            https://www.nakedcapitalism.com/2017/11/theresa-may-capitulates-brexit-settlement-agrees-pay-full-liabilities-will-brexit-ultras.html

            US rejects China’s ‘market economy; status (medium):

            http://www.zerohedge.com/news/2017-11-30/us-fights-chinas-market-economy-status-threatens-future-wto

Politics

  Domestic

  International

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