27 January 2021

1) There are growing fears that the long running bull market is about to crumble and collapse. The biggest sign is there are fewer stocks helping to drag benchmarks toward fresh records. When the underlying momentum wanes then we see weaknesses developing under the surface, which is what’s happening now. Fewer stocks are managing to end above their short-term moving averages even as indexes show record closing highs and yet fewer than 45% of their stocks managed to close above their 10-day moving averages.

2) China is working to overtake America by leading the global recovery from the pandemic thereby becoming more influential on the world stage than ever before. And China just might have the momentum and confidence to pull it off. As the world’s second largest economy shrugs off much of the Covid-19 pandemic this last year, China’s economy continues growing while the world crashes into recession. This could mean China’s GDP will exceed the United States later this decade, which will be years earlier than expected. China has outpaced the United States in attracting foreign direct investment for the first time, signing a trade agreement with the European Union giving European companies greater access to China’s1.4 billion consumers. Furthermore, China’s starts the new year without one of its most aggressive political adversaries, the former President Trump. China has sent help to other countries and in the process left many third world countries deeply in debt to China, claiming they are injecting more momentum into growth. But a host of geopolitical challenges, including the clashes over Hong Kong and alleged human rights abuses in China’s Xinjiang region, taking control of islands in the South China Sea and threats to Taiwan have all exacerbated tensions with the West and may stymie efforts to foster multilateral cooperation. These actions are unacceptable to the democratic nations, who are pulling away from China despite its attractiveness as a market.

3) There are fears that Biden’s executive order will aggravate America’s food crisis, by signing an executive order that addresses America’s most pressing economic needs. This order includes measures to blunt the meteoric rise in food insecurity during the pandemic. The order calls on the U.S. Department of Agriculture (USDA) to expand three key food assistance programs, which are the Pandemic Electronic Benefits Transfer (P-EBT), SNAP, and the Thrifty Food Plan.

4) Stock market closings for – 26 JAN 21:
Dow 30,937.04 down by 22.96
Nasdaq 13,626.06 down by 9.93
S&P 500 3,849.62 down by 5.74
10 Year Yield: unchanged at 1.04%
Oil: down at $52.75

23 November 20

1) When Joe Biden takes the presidential oath of office next year, he will need to address the question of his son and brother’s business arrangements with entities of foreign governments. A five-page report, with 65 pages of evidence, confirms the connections between the Biden family and the communist Chinese government, as well as the links between Hunter Biden’s business associates and the Russian government. Bidens’ global web of “consulting” and influence-mongering has created some unsavory question about conflicts of interest. Even if every past, present, or future business arrangement by Hunter and Jim Biden is technically legal, which is still an open question, plenty of difficulties can arise from financial pressure to do the bidding of those adversaries. To maintain public trust in his new administration’s diplomacy, the new president must force his son and brother to divest from many aspects of Biden family business.

2) Earlier this year, Australia was among the first countries to call for an official investigation into the coronavirus origins. China responded angrily which accusations that Australia’s highly irresponsible acts could disrupt international cooperation in fighting the pandemic. In recent months, China has imposed trade tariffs on Australia, targeted Australian journalists, and issued angry missives regarding Australia’s dealings with other regional powers. Chinese diplomats have distributed a document to Australian media listing Beijing’s grievances with Australia. These include unfairly blocking Chinese investment, spreading disinformation about China’s coronavirus response, falsely accusing Beijing of hacking, and engaging in incessant wanton interference in Xinjiang, Taiwan and Hong Kong. Yet while there may be legitimate concerns about China in a number of countries, such as the role of telecoms manufacturer Huawei in 5G networks, Australia has become more hawkish than most, but Australia could look foolish if Biden opens up partnerships with China on climate and pandemic management leaving Australia standing alone.

3) As Congress breaks for Thanksgiving, 12 million Americans may lose their jobless benefits on December 26 unless Congress can agree on a new stimulus deal in the next few weeks. More than half of the 21 million people currently collecting unemployment benefits can be effected. If lawmakers head home for Thanksgiving soon, it is even less likely they will reach a deal before they break for the year in December. As they do, millions of Americans could potentially lose their own residences when the nationwide eviction moratorium also expires at the end of the year. Tens of millions more cannot afford enough food to eat. Additionally, long-term unemployment is on the rise with the share of jobless workers out of work for 27 weeks or more, shot up from 19.1% to 32.5% in October, because there are simply not enough jobs being created to support all of the workers running out of aid before the end of 2020.

4) Stock market closings for – 20 NOV 20:

Dow 29,263.48 down by 219.75
Nasdaq 11,854.97 down by 49.74
S&P 500 3,557.54 down by 24.33

10 Year Yield: down at 0.83%

Oil: up at $42.47

17 November 2020

1) Because of the worldwide pandemic, Asia has been vastly overstocked with oil distillates this year. In response, China’s biggest refiner is eyeing a creative strategy to ease the persistent diesel glut by using brand new supertankers usually reserved for crude oil. While supertankers are built to transport dirty fuels such as crude oil, they can carry cleaner products like gasoline and diesel on their maiden voyage. Therefore, China’s largest oil refiner has hired a newly-built very large crude carrier to load low-sulfur diesel in Asia for delivery to Europe. China intends to charter brand new vessels on a regular basis to transport more diesel to Europe, thereby clearing out bloated fuel stockpiles in Asia. Oil prices settle lower after a surprise climb in U.S. crude supplies.

2) An adults-only luxury resort in the Maldives is offering guests (two people max) a year’s worth of unlimited stays in 2021 for $30,000. Called the “Unlimited Stays in Paradise” package, which includes an over water bungalow, free breakfast services, discounts on dining experiences at the resort and spa services. The 5-star adult-only resort has multiple restaurants and private dining experiences, an option for private movie screenings, a spa, and offers fun excursions. Since the start of the coronavirus pandemic, many destinations, Bermuda and Barbados for instance, are taking advantage of people wanting to opt-out of quarantining in their homes for an isolated vacation overseas. Three Hawaiian islands, Maui, Kauai, and the Big Island, considered allowing tourists to vacation in a Resort Bubble, which will allow visitors to safely roam.

3) China’s Ruler Xi Jinping has halted Ant’s record-breaking $37 billion IPO after the company’s boss Jack Ma snubbed government leaders. Jack Ma, Ant’s founder, criticized Chinese government leaders, when a week before the Chinese fintech was set to go public, Ma made incendiary comments that didn’t go down well with the president or other government officials. This is another example of how President Xi deals with any threat to his authority, such as Hong Kong, including a low tolerance for big private businesses that accumulate wealth and power. Ma also criticized the regulators who enforce a set of international banking rules as an old people’s club. The fintech had already secured over $3 trillion in orders from individual investors across its dual listings in Hong Kong and Shanghai.

4) Stock market closings for – 16 NOV 20:
Dow 29,950.44 up by 470.63
Nasdaq 11,924.13 up by 94.84
S&P 500 3,626.91 up by 41.76
10 Year Yield: up at 0.91%
Oil: up at $41.47

16 November 2020

1) Experts predict the growth of jobs will slow during a Biden presidency, simply because the easy gains are almost gone. So the easy part of job recovery will be history by the time President-elect Joe Biden moves into the White House, leaving a particularly difficult environment for an administration seeking to right the economy. The job growth rate has decline every month since June, and this will be even worst with the resurgence of the coronavirus putting economic growth into reverse. One cause of this is companies who laid off workers at the start of the pandemic, have since gone out of business, leaving nothing for laid-off workers to return to. Over a million workers are still being laid off or fired each month, with about 3.7 million additional workers who have quit working or looking for work entirely since February. Furthermore, it takes longer for skilled workers to return to work simply because there are few jobs available to choose from.

2) Massachusetts was one of the hardest hit states by the virus last spring, and this summer was seen as a model for infection control, but now, the number of Covid-19 cases are climbing once again with confirmed deaths surpassing 10,000. So Massachusetts is having to return to restrictions approaching another shutdown. And Massachusetts isn’t the only state seeing a strong resurgence in the coronavirus. California becomes the second state to top one million cases, with Texas closely following, who hit the grim milestone earlier this week. Just five states account for about one third of new cases. Nationwide, the pandemic has killed more than 240,000 forcing states to impose measures as cases surge. Many officials attribute raising number of cases to complacency in travel and social settings such as bars and house parties.

3) Canada welcomes Hong Kong refugees amid China crackdown by easing immigration requirements for them. Canada plans to target young, educated Hong Kongers. Their plan includes the creation of a new three-year open work permit for recent graduates and shortening eligibility for permanent residency to one year. This comes at a low point in Canada-China relations, after the 2018 arrest of a top Huawei Technologies Co. Ltd. executive. Hong Kongers already in Canada will now be eligible to apply for permanent residency sooner, provided they meet language and education requirements and have worked for a year in Canada.

4) Stock market closings for – 13 NOV 20:

Dow 29,479.81 up by 399.64
Nasdaq 11,829.29 up by 119.70
S&P 500 3,585.15 up by 48.14

10 Year Yield: up at 0.89%

Oil: down at $40.12

13 November 2020

1) Joe Biden will immediately face several major problems and hard decisions upon assuming the Presidency. 1) Containment of the coronavirus that has killed close to a quarter-million Americans and shows no signs of abating. 2) Addressing the nation’s bitter political divide as the divide deepens with no apparent end. 3) Regrowing a devastated economy with millions out of work and no real relief in sight. 4) The threat of growing civil unrest and open conflict as people are pushed further out of the social economic system by technology. 5) China’s growing aggressiveness, both domestically and internationally, coupled with China’s goal to be the dominate world power by 2050, making China a tender box for world conflict. 6) Russia and Iran’s trouble making in world activities, especially in the middle east, also could mean serious military conflict problems for America and the West.

2) In September, NTT announced its plan to buy out the remaining shares in NTT Docomo, in a potentially record-breaking deal. NTT currently holds 66 percent of NTT Docomo’s shares, and its chief executive argues the buy would enhance competitiveness and growth. But 28 Japanese telecom companies, including rivals SoftBank Corp and KDDI, have sent a joint letter to the communications minister protesting the purchase. Their fears of making Docomo a wholly owned company will create a powerful force that dominates the market, so they’re challenging the $40 billion dollar NTT takeover bid. The takeover of the country’s biggest mobile carrier would prevent fair competition, therefore the opposition wants to set up measures to protect an environment of fair competition and ensure compliance and implementation. With the sale, NTT may be able to push down prices quickly, forcing competitors to follow suit.

3) China’s repression of its peoples has taken another step forward with Hong Kong’s opposition lawmakers expected to formally tender resignations in protest of the oustings of four fellow supporters of pro-democracy. Their dramatic departure removes dissent in Hong Kong.
The Chinese parliament passed a resolution allowing Hong Kong authorities to expel legislators deemed a threat to national security or for not holding allegiance to Hong Kong, and without having to go through the courts. The fate of the opposition in Hong Kong has been in doubt since the government postponed September’s legislative elections by a year, in a move which critics have said was aimed at killing the pro-democracy camp’s momentum.

4) Stock market closings for – 12 NOV 20:
Dow 29,080.17 down by 317.46
Nasdaq 11,709.59 down by 76.84
S&P 500 3,537.01 down by 35.65
10 Year Yield: down at 0.88%
Oil: down at $40.92

29 October 2020

1) One major factor in the spread of Covid-19 virus, is the portability of societies, the degree which people are moving about and interacting with each other with ease. This is a major cause of the spread of infectious disease. Now with the surge of coronavirus in Europe, Germany and France, they are planning to restrict movement of people for at least a month, coming close to the stringent lockdowns of the spring as European leaders seek to rein in a resurgent pandemic outbreak. Spain, Italy, the U.K., Greece and Portugal reported record numbers of new cases on Wednesday. Asia, Singapore and Hong Kong could start a planned ‘travel bubble’ as soon as next month. This also means restrictions of travel for migrant workers, which in turn means restricting their ability to make money, where much is sent back home to families to support their subsistence.

2) Boeing Aircraft company, a major manufacture of airliners, will cut 7,000 more jobs amid the pandemic, almost doubling its planned job cuts. The coronavirus pandemic has prolonged the grounding of Boeing’s 737 Max jet, thus dimming prospects for financial recovery. Executives are abandoning their forecast that Boeing will stop burning cash next year and so they are now forced to eliminate an additional 7,000 jobs. That will bring the expected losses from layoffs, retirements and attrition to 30,000 people, or 19% of the pre-pandemic workforce, by the end of 2021.

3) Taiwan’s microcircuit manufacture United Microelectronics Corp. has pledged its assistance to the U.S. in a high-profile trade-secrets prosecution of Chinese chipmaker Fujian Jinhua Integrated Circuit Co. UMC has pleaded guilty Wednesday in federal court as part of a deal with U.S. prosecutors. Prosecutors agreed to drop serious charges of economic espionage and conspiracy for theft of proprietary information from Idaho-based Micron Technology Inc. UMC instead admitted to trade-secret theft and agreed to pay a $60 million dollar fine. Prosecutors haven’t publicly detailed the cooperation they are seeking from UMC against Fujian

4) Stock market closings for – 28 OCT 20:
Dow 26,519.95 down 943.24
Nasdaq 11,004.87 down 426.48
S&P 500 3,271.03 down 119.65

10 Year Yield: unchanged at 0.78%

Oil: down at $37.69

9 September 2020

1) It’s not just American businesses who are feeling the effects of the Covid-19 crisis from reduced sales, American charities are also suffering a major drop in revenues for the same reason. With the recession straining household budgets, people are less able to contribute resulting in charities losing billions of dollars since this spring. Furthermore, traditional money raising methods such a concerts, festivals and galas have been canceled or scaled back to a fraction of their previous size. Many charities are now working to make the holiday season productive to make up shortfalls in revenue.

2) The repressiveness of the Hong Kong police was further exposed when police chased down and tackled a 12 year old girl in a shopping mall. Video footage of several police officers pinning the hapless girl down on the floor went viral worldwide with a public outcry over the excess use of force against political dissenters. The incident touched off angry shouts from onlookers. The police tactics are being criticized as an indiscriminate treatment of children who are not taking part in protest. The girl complained she felt targeted because of her age, that being young has become a crime in Hong Kong, further increasing concerns that the regime is targeting their young for repression.

3) The markets continue their decline after a five week winning streak as investors begin to worry about stretched valuations. The decline is being lead by the technology stocks, which has met a heavy decline for the tech-heavy Nasdaq. Remarks by President Donald Trump to decouple the U.S. economy from China further added to the market’s jitters. The high flying technology company Tesla has suffered it worst one day loss since March with an 18% drop in the price of its stock.

4) Stock market closings for – 8 SEP 20:

Dow 27,500.89 down 632.42
Nasdaq 10,847.69 down 465.44
S&P 500 3,331.84 down 95.12

10 Year Yield: down at 0.68%

Oil: oil down $36.62

1 July 2020

1) The credit worthiness of automakers has been lowered by Moody’s Investors Service, downgrading about $130 billion dollars in global automakers’ debt. Nine out of 22 global car makers have had their ratings lowered. General Motors Co. has a Baa3 rating for unsecured notes, the lowest investment grade rating and has a negative outlook. Ford Motor Co.’s senior unsecured debt is rated at Ba2, which it two notches below investment grade and also has a negative outlook. Thirteen of the automakers were not downgraded because of their better operating profiles and liquidity, but 75% have a negative outlook. World automakers were having troubles before the pandemic, but now are facing more declining auto sales and low prospects for near term improvement.

2) China has adopted a national security law that allows Beijing to override Hong Kong’s judicial system. The intent of China is to strangle and suppress political opponents in Hong Kong and subjugate the freedom of its citizens. This is another example of the re-emergence of Red China as a totalitarian state, and therefore represents a threat to surrounding nations. It strips the territory of autonomy promised under the handover agreement with Britain, with possible retaliation from America. The move by China has resulted in visa restrictions on officials from both sides, and a threat of future retaliation measures coming.

3) Fears of another virus pandemic have surface with the discovery of a new swine flu virus in Chinese pigs. The new strain, called G4 H1N1 has many of the same characteristics of H1N1 that caused the 2009 global pandemic, and can bind to, infect and replicated in tissue cells located in human airways. While not an immediate threat, the virus bears watching, but on top of the Covid-19 pandemic, the problem of controlling either outbreaks would be multiplied, especially with the now overstretched health care and hospital systems.

4) Stock market closings for – 30 JUN 20:

Dow 25,812.88 up 217.08
Nasdaq 10,058.76 up 184.61
S&P 500 3,100.29 up 47.05

10 Year Yield: up at 0.65%

Oil: up at $39.86

2 June 2020

1) Experts say it could take as much as a decade for America’s economy to fully recover from the coronavirus and the subsequent massive shutdown of businesses. Presently, it’s expected that the GDP (Gross Domestic Product) will decrease about 3% from 2020 to 2030 or about $7.9 trillion dollars. It’s expected that the measures to counter the virus, the business closures and social distancing measures, will reduce consumer spending, which in turn will cool the economy. With 41 million people now unemployed, more layoffs are expected for the next week with an unemployment rate of 19.6%. Furthermore, it’s expected that the coronavirus will cost the economic about $7.9 trillion dollars.

2) The reopening of America from the lockdown was going to be difficult enough, but now the growing violence of protest is threatening to hamper that recovery. Stores in the protest areas are closing for the protection of its employees such as CVS and Target, with doubts mounting if some of the stores will ever reopen. Mayor Lightfood of Chicago said the continuing violence is making the city reconsider the opening of Chicago’s businesses. Also, the wireless carriers T-Mobile has closed Metro and Sprint stores over the same consideration of possible violence.

3) China has stopped some imports of U.S. farm products such as soybeans and pork meat. This is the latest sign that the January phase one trade deal between the world’s two largest economies is unraveling. The halts come after President Trump’s criticism of China’s efforts to bring Hong Kong under the firm control of the communist. The president is threatening to strip Hong Kong of some of it’s special privileges, which in turn would make Hong Kong less valuable economically to China. Further aggravating U.S. and Chinese relations is the charges that China shares some responsibility for the Convid-19 pandemic.

4) Stock market closings for – 1 JUN 20:

Dow 25,475.02 up 91.91
Nasdaq 9,552.05 up 62.18
S&P 500 3,055.73 up 11.42

10 Year Yield: up at 0.66%

Oil: up at $35.56

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