16 October 2020

1) Peloton, the exercise machine maker, has recalled pedals on 27,000 of their bikes which have caused some injuries. The 27,000 bikes were manufactured between July 2013 and May 2016. The company has received 120 reports of the pedals breaking resulting in 16 injuries to users, with 5 people requiring medical care including stitches. Peloton is one of the few companies who have benefitted from the coronavirus crisis because with people staying at home for long periods, they are purchasing home exercise machines. Their stock is up 380% a year to date, while their fitness subscribers is up 113% from a year ago.

2) The investment firm BlackRock considers China’s domestic bond market to be a good investment, offering a level of returns that may be difficult to find elsewhere in the current world economy. Economic data and continued monetary policy support, point to a sustained economic recovery, with foreign investors remaining under-invested in Chinese bonds. These investors account for only about 2% of the $16 trillion dollar market. Using diversified and resilient portfolio allows investors to avoid being exposed to risk specific for a company or sector. While there are some troubling signs, such as China Evergrande Group seeking government help in meeting its debt, looking across the whole spectrum, a fairly diversified portfolio can be built to yield a reasonable income.

3) General Motors will start operating robot cars in San Francisco without any human backups in the cars by the end of this year. The company Cruise has received a permit from California’s Department of Motor Vehicles to allow them to operate robot cars, without humans, on public highways. Other companies have gotten permits for autonomous automobile operation without humans, including Waymo, but none have set a date for autonomous ride-hailing services. Cruise will start ride-hailing service first in the surround neighborhoods, one at a time, slowly working their way into the heart of San Francisco with it’s dense traffic challenges. Progress towards fully autonomous ride-hailing services was retarded in 2018 when an Uber autonomous test car ran down a pedestrian in Temple Arizona.

4) Stock market closings for – 15 OCT 20:

Dow 28,494.20 down 19.80
Nasdaq 11,713.87 down 54.86
S&P 500 3,483.34 down 5.33

10 Year Yield: up at 0.73%

Oil: down at $40.89

24 September 2020

1) California’s annual bout of fires has just added a new dimension to the state’s history. The Creek Fire has become the state’s single most massive wildfire in history by burning 286,519 acres in Fresno and Madera counties. Ignited on September the fourth, it has so far destroyed 855 structures and damaged 71 others. There are now 50 major fires across the West coast this week, so far claiming 26 fatalities, while consuming 2.2 million acres. There are forty crews with 3,100 personnel who are fighting the fires, but only about 32% of the Creek fire blaze has been contained. No estimates yet of just how much monetary damages the state has suffered.
2) As the remnants of Sally continue moving across the southeastern United States, the first estimates are in for the damages. Sally made landfall as a category 2 storm near Gulf Shores, Alabama bringing a storm surge that caused major flooding in places like Pensacola with several feet of water. Damages are expected to cost upwards of $2 billion dollars. NOAA’s aerial imagery is being evaluated to more accurately determine the extent of flooding and damages in Florida and Alabama. Major beach erosion is also apparent too.
3) Tesla’s much touted Battery Day appears to have disappointed most of the average people, with Tesla (TSLA) stock tumbling down 8.6% in midday trading, on track for its lowest close in two weeks. Investors fear that promised new batteries will take years to fully develop and be available for automobiles. Tesla unveiled a new battery design that is 56% cheaper and more efficient for use in automobiles, which should be a big step towards the viability of fully electric cars. Additionally, the company announced a future robot car for $25,000 that will be fully autonomous, and available in the next three years. The new battery technology will enable sleeker affordable cars that can travel much longer distances on a single charge. Investors had expected announcements of two big innovations, the first one is a ‘million mile’ battery that would be good for ten years or more, as well as a cost reduction, a target specified as dollars per kilowatt-hour, which would finally drop the price of an electric vehicle below that of a gasoline car.
4) Stock market closings for – 23 SEP 20:
Dow 26,763.13 down 525.05
Nasdaq 10,632.98 down 330.65
S&P 500 3,236.92 down 78.65
10 Year Yield: up at 0.68%
Oil: up at $39.59

9 April 2020

1) The electric auto maker Tesla announced it is furloughing workers as well as cutting employee salaries as a result of the coronavirus shutdown of its facilities. Furthermore, the virus pandemic has slashed demand for cars and forced several other automakers to furlough workers. Barring any significant changes, Tesla plans to resume normal operations on May 4. Salary reductions will start on April 13 and remain in place until the end of the second quarter. Workers salaries are cut by 10%, directors by 20% and vice presidents by 30%. The company considers it has sufficient cash reserves to weather the shutdown.

2) Nuro’s driverless delivery vehicles has received another approval. California’s DMV has given a permit for Nuro to operate in specific parts of Santa Clara and San Mateo counties. While test have been permitted since 2017, a human monitor was required, but these vehicles will be fully autonomous having no humans. This is another step in the rapidly changing retail market, which is embracing wide spread automation in its sales, as robots become more involved in consumerism activities.

3) The number of deaths projected for the coronvirus has been lowered, but there are fears of a ‘second wave’ to follow. The pandemic model has scaled back its projected death toll by 26% to 60,000 however, if social distancing practices are not maintained, a second wave of infections may ensue. So far, about 400,000 coronavirus cases have been reported with roughly 13,000 deaths. But even the revised forecast suggest months of infection troubles for the United States. About 94% of the population has been ordered to stay at home.

4) Stock market closings for – 8 APR 20:

Dow 23,433.57 up 779.71
Nasdaq 8,090.90 up 203.64
S&P 500 2,749.98 up 90.57

10 Year Yield: up at 0.76%

Oil: up at $26.14