6 February 2020

1) For the first time in six years, the U.S. trade deficit fell as the White House’s trade war with China curbed imports. The trade deficit dropped 1.7% to $616.8 billion dollars last year with steep decline in industrial materials and supplies, consumer goods and other goods. The trade deficit for goods with Mexico jumped to a record high of $101.8 billion dollars last year, with the European Union reaching an all time high of $177.9 billion dollars.

2) The Ford Motor Company is posting a$1.7 billion dollar loss and anticipates a weak forecast for 2020. General Motors is also reporting poor performance for 2019 and anticipates flat profits for 2020. Both Ford and GM’s troubles are in part from slaking sales in China, in particular with the economic slowdown in China from the coronavirus pandemic. The major competitor to the duet auto makers, Tesla, is suffering from the coronavirus closing of its Shanghai factory which builds its Model 3 sedans.

3) Macy’s, another major world renowned retailer, is experiencing the brick-and-mortar decline of other major traditional retailers. The chain is closing 125 of its stores, in addition to the 100 stores it has already closed, and cutting about 2,000 corporate jobs. Their strategy is to exit weaker shopping malls and focus towards opening smaller format stores in strip centers. But even with these changes, the future of Macy’s is abysmal. The company has lost market share in core categories such as apparel, as fewer shoppers take trips to malls, preferring on line shopping.

4) Stock market closings for – 5 FEB 20:

Dow                 29,290.85    up    483.22
Nasdaq             9,508.68    up      40.71
S&P 500            3,334.69    up      37.10

10 Year Yield:    up   at    1.65%

Oil:    up   at    $51.17

3 February 2020

1) Brexit, the exit of Britain from the European Union, has been confirmed by the European Parliament with a vote Wednesday, which ratified the withdrawal agreement. The vote to ratify was 621 to 49 with 13 abstentions. For the EU (European Union) the loss of Britain represents a significant defeat, a loss of size, reach, momentum and permanence akin to the U.S. losing Texas. Potentially, the EU bloc now has less clout, although the remaining 27 countries have been drawn tighter together by the debate. Now comes the negotiations of EU’s future relationship with Britain to try and maintain the single open market.

2) Delta Air Lines and American Airlines announced they are suspending service to mainland China to counter the spread of coronavirus. It is expected that United Airlines is expected to soon follow suit. American will continue service to Hong Kong. Other world air carriers have also announced suspended or reduced services to China.

3) With the decision two years ago by the Supreme Court to widely legalize sports betting, companies are rushing in to expand sports betting operations. U.S. casino operators, fantasy apps and betting grands from Europe and Australia are in a race for American customers now that the way has been cleared for betting outside of Nevada.

4) Stock market closings for – 31 JAN 20: Fears of China’s coronavirus continue to push markets down.

Dow                   28,256.03    down    603.41
Nasdaq               9,150.94     down    148.00
S&P 500              3,225.52     down       58.14

10 Year Yield:    down   at    1.52%

Oil:    down   at    $51.63

23 January 2020

1) Present Trump has renewed his threats to impose tariffs on imported cars from Europe, citing that the European Union is even more difficult to do business with than China. His comments signals he is turning his attention to renegotiating trade deals with the bloc. Automobiles have been at the center of trade tensions for the past couple of years.

2) The millennials own just 4% of American real estate by value, much less than the 32% which baby boomers owned. This comparison is with approximately the same media age of the two groups, meaning the millennials are far behind the baby boomers economically. While millennials may close that gap in the next four years, it’s unlikely they will reach 20% ownership, still far behind the baby boomers.

3) There is a rash of retail store closings after the holiday season, due to sales slump. Fashion retailer Express is closing 91 stores, Bed Bath & Beyond is closing 60 , Schurman Retail Group is closing its Papyrus and American Greeting stores for a total of 254 locations in the next four to six weeks. Express is the latest in a serious of fashion retailers to close, part of the struggle of malls to compete in the new retail arena. Last year, retailers Forever 21 filed for bankruptcy, with Charlotte Russe and Payless ShoeSource going out of business.

4) Stock market closings for – 22 JAN 20:

Dow            29,186.27    down       9.77
Nasdaq         9,383.77          up     12.96
S&P 500        3,321.75          up       0.96

10 Year Yield:       unchanged   at    1.77%

Oil:         down   at    $56.17

4 October 2019

1) MGM Resorts has reached agreement with families of victims who were killed in the October 2017 mass shooting in Las Vegas. The settlement for the 2,500 family victims will be almost $800 million dollars with the agreement that all pending litigation against MGM will be dismissed. The shooting left 58 dead while wounding hundreds of others.

2) Soon to be implemented, tariffs will make imports more expensive for Americans, such as Scotch and Irish whiskies, Parmesan cheese and French wine. The tariffs will be on $7.5 billion dollars of European imports. Further tariffs are threaten over aircraft subsidies by the European Union, coming at a time when economies have been hurt by the US-China trade war. The World Trade Organization has ruled America can impose tariffs because the European Union has failed to abide by earlier ruling of Airbus subsidies.

3) The service-sector activity in the U.S. slowed to its weakest pace in three years this September. This is another sign that the U.S. economy may be weakening where the services sector accounts for more than two thirds of economic activity. The non-manufacturing index fell to 52.6 last month, which was the lowest reading since August 2016 and far below the 55.3 expectations.

4) Stock market closings for – 3 OCT 19:

Dow                 26,201.04    up    122.42
Nasdaq              7,872.26    up      87.02
S&P 500             2,910.63    up      23.02

10 Year Yield:    down   at    1.54%

Oil:    down   at    $52.34

8 April 2019

1) The European Union has offered to extended the exit date in an effort to avoid a unplanned crash-out. Prime Minister May asked for an extension to 30 June, but the EU countered with a offer for a one year extension, which could be terminated early if an exit plan is agreed upon before the one year is up.

2) Samsung has forecast the lowest quarter profits in more than two years. The first quarter outlook looks ugly with a 15% decline from last years first quarter. The poor performance is a result of poor semiconductor sales coupled with a slowing growth in the smart phone market.

3) New jobs in March is six times that of February. The US added 196,000 new jobs, many claiming this indicates solid growth in the economy, and therefore the economy is doing just fine. But some worry about the unemployment rate holding steady, because an upturn in the unemployment rate usually signals a recession in the near future.

4) 5 APR 10 Stock market closings:

 Dow           26,424.99     up    40.36
Nasdaq        7,938.69     up    46.91
S&P 500       2,892.74     up     13.35

10 Year Yield:     down   at    2.50%

Oil:    up   at    $63.26

27 March 2019

1) British parliament voted to take control of Brexit for one day this Wednesday, to try their hand at resolving Britain’s dilemma of departing the European Union. If the division running through the British public is any indicator, then it’s rather unlikely parliament will reach any consensus on a solution.

2) Airbus of France announced a $35 billion dollar sale to China for 290 of their A320 airliners plus another 10 of their A350 wide body airliners. This is another blow to Boeing in addition to the grounding of their best seller, the 737 MAX 8, which is comparable to the A320. The grounding of the 737 MAX 8 coupled with the fallout from the US-China’s trade war is a serious impediment to Boeing. China is the world’s largest aviation market.

3) Apple sales in China has declined due to demand for domestic products. Apple products have become too expensive, so the Chinese people are turning to domestic products which now have most of the same features as Apple for much less.

4) 26 MAR 19 Stock market closings:

Dow         25,657.73      up    140.90
Nasdaq       7,691.52      up       53.98
S&P 500      2,818.46      up      20.10

10 Year Yield:     down   at    2.41%

Oil:     up   at    $60.04

7 March 2019

1) The economic balance in US trade deficient soared last year to $621 billion dollars, the highest level in ten years. Exports from the US fell 1.9% while imports rose 2.1%. The deficient with China was $419 billion dollars. The strong US economy is considered a factor in the increase of the imbalance.

2) Italy’s experiment with Universal Basic Income is having dismal results, with Italy’s poverty and unemployment rising. The intent of the program was to alleviate poverty and address it’s high unemployment, for Italy has the highest unemployment rate in Europe. Finland tried the same scheme, but scraped it’s program after two years. The European Union is taking exception to Italy’s spending habits.

3) The General Motor’s Lordstown plant is shutting down with the loss of 5,400 jobs. This shows that despite the booming job market in America, the economy is still leaving people behind. Major problem is the workers are older and lack the computer and technical knowledge to retrain for other job fields.

4) 6 MAR 19 Stock market closings:

Dow               25,673.46       down       133.17
Nasdaq            7,505.92       down         70.44
S&P 500           2,771.45       down         18.20

10 Year Yield:     down   at   2.69%

Oil:     down   at    $56.15

1 March 2019

1) Apple announced they are laying off 190 people from their self driving car division. These includes forty hardware engineers, twelve software engineers and one machine shop technician. Speculation is that Apple is pulling out of the self driving car competition. They hadn’t actually built a working self driving car, rather they have reportedly concentrated on the sensors and software organic to such systems, which means they are behind the other developers.

2) The Brexit problem for Britain deepens as considerations are being made for Britain to extend the time when it’s exits from the European Union. No time for extensions has been agreed upon yet, although the Prime Minister has stated than it cannot be more than a few weeks. This is another example of the British’s concerns for the difficulties that face Britain’s exit.

3) Twenty-first Century Fox studios has been ordered to pay actors of the hit show “Bones”, $179 million dollars in punitive damages, which it withheld from profits promised to the actors.

4) 28 FEB 19 Stock market closings:

Dow                  25,916.00    down    69.16
Nasdaq               7,532.53    down    21.98
S&P 500              2,784.49    down      7.89

10 Year Yield:    up   at    2.71%

Oil:    down   at    $57.18

26 February 2019

1) British farmers and produce workers divided over how Brexit could effect trade. Produce imports comes mostly from European Union and many of the produce workers in Britain are foreign. There are just 32 days left until Brexit automatically happens.

2) Rwanda is being courted by invertors amidst booming economic growth. The government is stable with 7% growth last year and 7.8% growth expected this next year. With the $2 billion dollars invested so far, there are now thousands of new jobs.

3) Fears of sub-prime mortgages could cause another 2007 bubble bust which then caused the 2008 economic crash world wide. Presently, 21% of those sub-prime mortgages are five years without payment because the word got out that mortgage companies were not foreclosing.

4) 25 FEB 19 Stock market closings:

Dow               26,091.95    up    60.14
Nasdaq            7,554.46    up     26.91
S&P 500            2,796.11    up      3.44

10 Year Yield:    up   at    2.67%

Oil:    down   at    $55.42

20 February 2019

1) PMI readings released for America, Japan and the Eurozone indicate a slowing down. This is a result of international tensions, with America having a one in four chance of a slowdown.

2) Honda announced it is pulling out of England, with a loss of 3,500 jobs. Honda claimed their decision wasn’t a result of Brexit, but Britain is considered to be a business friendly country and therefore a portal into the European Union, but with Brexit that will now be going away. Presently, about half the cars in Britain are Japanese models, and Honda’s withdrawal is raising fears that the other Japanese automakers will decide to also withdraw.

3) Fears deepen that the sharp rise of the yen may hurt Japan’s economy. Japan is plagued by low growth, tepid consumer purchases, fast falling of exports and an aging population, all which contribute to Japan’s economic woes.

4) 19 FEB 19     Stock market closings:

Dow                 25,891.32     up      8.07
Nasdaq             7,486.77     up    14.36
S&P 500            2,779.76     up      4.16

10 Year Yield:      down    at     2.65%

Oil:       unchanged   at    $56.09