1) President Trump’s tax cuts could be undone a little at a time. Unlikely to repel his tax cuts directly, the Democrats could slowly undo them by an ‘end-run’ with new or other tax increases. The house Democrats have a package of tax legislation to be debated Thursday which proposes changes to the estate tax which would make it apply to more people sooner and making small increases to the corporate tax rate. Also, there are proposals to raise the tax rate to 70% for those earning over a million dollars.
2) Caesars Entertainment, who’s ownership includes the famous Caesars Palace in Las Vegas, is being bought by Eldorado Resorts for about $8.5 billion dollars in cash and stock. The plan is to build up their size to compete with larger companies such as Las Vegas Sands and Wynn Resorts. Caesars Entertainment owns and operates 34 properties in nine states and three continents.
3) Shale oil producing companies are pumping lots of oil, but are making little money. The process of fracking is an expensive procedure which requires high oil prices to be viable. As oil prices have sagged over the last couple of years, the margins have narrowed, forcing shale oil companies to more tightly control their expenses, including making extensive cuts in their labor force. Many of the older wells are failing to met expectations for production and oil companies have fewer future drilling locations than they anticipated. Shale oil wells initially produce a lot of oil and gas, but quickly taper off, so more money must be spent to coax the oil out of the rock, thus narrowing the margins.
4) Stock market closings for- 24 JUN 19:
Dow 26,727.54 up 8.41 Nasdaq 8,005.70 down 26.01 S&P 500 2,945.35 down 5.11
1) Gold, which is known as a ‘panic’ investment to guard against economic collapse, is passing $1,400 an ounce for the first time since 2013. Fueled by the fears of an international economic downturn and possible military action between Iran and the U.S., coupled with the large buying of gold by China, experts say that prices could reach $1,500 to $1,600 per ounce in the next year. Gold has historically been seen as a guard against devaluation of currencies.
2) Slack, the workplace messaging software used in tech and media companies, may be breaking the grip Wall Street has on Silicon Valley. The IPO’s of tech companies have been the controlling link of Wall Street on tech companies, but Slack used direct listing of its stock instead of the traditional IPO, thus cutting Wall Street out of the equation. This means that Wall Street isn’t able to tell companies what to do in becoming a public company.
3) Automation continues to cut into the job market with these ten career fields declining because of technology. The Telemarketer jobs are down 52%, followed by File clerks down 46%, Sorters of mail at 44%, Bill collectors down 39%, Data entry 36%, Order clerks 36%, Chief executives at 35%, Production worker helpers 30%, Installation, maintenance and repair helper 30% and finally Telecommunication line installer/repairers down 30%.
4) Stock market closings for- 21 JUN 19:
Dow 26,719.13 down 34.04 Nasdaq 8,031.71 down 19.63 S&P 500 2,950.46 down 3.72
1) Boeing has landed a$24 billion dollar contract from IAG SA, the owner of British Airways, to purchase 737 MAX airliners. Rival builder Airbus has vowed to fight the agreement since they never received an RFP (Request For Proposal) for making a bid on the contract. The secret negotiations between Boeing and IAG was the bomb shell surprise coming out of the Paris air show this week. This sale comes as a major endorsement to Boeing’s 737 MAX to reestablish Boeing as a major supplier of airliners.
2) The price of crude oil shot up 5% over news that Iran has shot down a American drone aircraft, fueling additional fears of a US-Iran military confrontation. The drone was shot down by a surface to air missile while flying over international airspace of the Strait of Hormuz. This is another move by Iran to control the seaway and thus control the flow of oil in an effort to force the U.S. to abandon its crippling economic sanctions.
3) The cost of opening a major fast food franchise in terms of liquid assets can be as much as a million dollars or more. You must have $500,000 cash to open a McDonald’s, $750,000 to open a Taco Bell and $2 million dollars to open a Wendy’s. Startup costs exceed a million dollars for most major fast food chains in America, with additional monthly fees for royalties, advertising and services, which can add up to 10% of gross sales.
4) Stock market closings for- 20 JUN 19:
Dow 26,753.17 up 249.17 Nasdaq 8,051.34 up 64.02 S&P 500 2,954.18 up 27.72
1) The $800 billion dollar trucking industry is in a slowdown as retailers and manufacturers are shipping less. Freight rates have declined for the last six months with the spot market dropping 62.5% for May verses last year. Already, a few major trucking firms have gone bankrupt, with one laying off 550 employees. Even the major trucking companies FedEx, UPS and J.B. Hunt have experienced declines sparking fears of a slowdown of the economy.
2) Harley-Davidson is making good its promise to build more motorcycles outside the United States by partnering with China’s Qianjiang Motorcycle to produce smaller motorcycles. The new bike will have a 338 cubic centimeter engine verses the 601 cc engine for its domestic motorcycles. Harley-Davidson is trying to boost its overseas sales as its domestic market shrinks.
3) Expectations for future global growth and corporate profits have shrank as investor confidence continues to decline amid the trade war. Concerns of an economic slowdown further fuel fears of investors for the demise of global growth, despite America’s stock market now trading near its record high. Global profit expectations fell by the second largest amount on record. The giant retailer Walmart announced they will be laying off nearly 600 employees later this year.
4) Stock market closings for- 19 JUN 19:
Dow 26,504.00 up 38.46 Nasdaq 7,987.32 up 33.44 S&P 500 2,926.46 up 8.71
1) The pizza giant Domino’s will test pizza delivery using fully autonomous vehicles in Houston. Domino’s has been exploring this technology for the last two years with robot cars that had standby drivers for safety, but these robots will be human free. The Silicon Valley startup Nuro, who has been working with the grocery chain Kroger testing home delivery service, will provide the automobiles. Customers will be able to make orders via their smart phones, track progress of the cars, then use their smart phone to unlock the robot car to obtain their pizza.
2) Boeing Aircraft Co., the manufacture of the grounded 737 MAX, announce they have not received one single order for new airliners at the Paris air show. Their rival Airbus recorded orders and options for 123 new planes. Overall orders for this year’s Paris air show is expected to be the lowest since 2016, with emphasis on defense spending.
3) President Trump announced he will meet with China’s Xi Jinping at the G-20 summit, raising hopes of resumption of Chinese-American trade talks and a deal which will resolve the current trade war. The President says he will have extended meetings next week at the G-20 conference in Japan. News of the meeting coupled with expectations of near future cuts in the interest rates boost confidence in the markets.
4) Stock market closings for- 18 JUN 19 Stocks rally on news of US-China trade talks.
Dow 26,465.54 up 353.01 Nasdaq 7,953.88 up 108.86 S&P 500 2,917.75 up 28.08
1) Traditional retail stores, who have been suffering the ravages of e-commerce, are worried about another coming blow. The new tariffs on Chinese imports, which President Trump threatens to impost, could have a disastrous effect on retailers such as Walmart and Target. These next round of tariffs will be specific to consumer goods, which these retailers sell, and will start to force price increases and so most likely will result in decline of sales revenue.
2) While President Trump has been pressing for a cut in the interest rate, the U.S. Federal Reserve is expected to defer and leave the interest rates unchanged. However, the board may possibly lay the groundwork for a rate cut later this year. While the economic outlook has become less clear, there still isn’t sufficient indication of a slow down to warrant cutting interest rates yet.
3) The Pfizer pharmaceutical company is buying Array BioPharma for $10.6 billion dollars for a price 62% above the company’s closing price this last Friday. Pfizer will gain medical technology for new drugs to treat cancer that limit or suppress the effects of chemotherapy. The drugs target a mutation that’s found across many tumor types in those patients who carry the mutation. Two of Array BioPharma drugs have been FDA approved for use in advanced melanoma. There are other drugs which are in the development pipeline.
4) Stock market closings for- 17 JUN 19:
Dow 26,112.53 up 22.92 Nasdaq 7,845.02 up 48.37 S&P 500 2,889.67 up 2.69
1) Citizens of Hong Kong have started moving assets offshore amid fears of a China takeover. China’s demand to extradite criminal suspects to face trial in China is seen as a political move to be able to more tightly control the population politically, by eliminating dissidents and political opposition. People of money are also fearing that China will clamp down on moving money out of the reach of the Chinese government. This move is heightening the tensions of China and western nations.
2) As a result of its legal entanglements from lawsuits alleging Roundup herbicide is a carcinogen, Bayer AG plans to invest almost $6 billion dollars in developing new chemical products to combat weeds over the next decade. Roundup is a product inherited by Bayer in its takeover of Monsanto Co. last year, which has driven its stock down by 50%.
3) The trade war between China and U.S. is having unexpected results of other countries taking up the manufacturing slack. This runs the risk of China permanently losing market share to America as well as China failing to archive its goal of becoming the worlds top global manufacturing base. This decreases China’s chances of becoming a technologically advance and innovative economy. China’s loss of their once famed ‘low pay for unskilled labor’ is further increasing the flight of factories to other countries.
4) Stock market closings for- 14 JUN 19:
Dow 26,089.61 down 17.16 Nasdaq 7,796.66 down 40.47 S&P 500 2,886.98 down 4.66
Certain studies have indicated there seems to be disparities between hourly wage jobs and workers who work on the clock hourly. Certain contributions can be urban development in metropolis cities, need for more experienced workers in certain job fields, and growth in urban environments.
In a study by Urban Institute and reported by Yahoo Finance. Affordable housing is hard to come by to hourly wage workers, and gentrification in major metropolis urban areas such as NYC, San Francisco, Los Angeles, Boston, are making it harder for hourly workers to make any sort of living, the Urban Institute provides.
Housing development in major cities tend to be way more in rentals, then in smaller cities or rural areas but conflicting accounts tend to point any one direction? As in regards to the root of the problem. Noone has figured it out yet, whether it’s local politicians to the the developers themselves… Answers have not been provided to address the problem as whole. So this “everybody for themselves mentality” is dictated for survival to many who work hourly wages. -SB
Credit:Urban Institute Study: https://www.urban.org/features/too-far-jobs-spatial-mismatch-and-hourly-workers