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

18 November 2020

1) Crude oil prices and energy stocks aren’t the only things that have fallen during this oil downturn, land prices with potential oil shale have also plummeted. The average price of U.S. oil shale acreage has fallen by more than 70 percent in two years, falling from $17,000 per acre in 2018 to $5,000 per acre in 2020. The value of oil and gas assets has plunged because of the coronavirus pandemic sending crude oil demand down globally, consequently most energy companies are slashing their costs instead of purchasing new land for oil and gas drilling. Oil and gas companies are forced to sell assets to make up money lost on deals.

2) On January the first of next year, President Trump’s pause on student loan payments for 33 million Americans is set to expire, just three weeks before President-elect Joe Biden is slated to take over. The Education Department is warning borrowers this week that their monthly payments will resume. For the incoming president, the economic and administrative mess could take months to untangle, consuming the early days of his Education Department. The student loan system was not designed to start and stop at any time for 30 million borrowers. This became apparent in March when loan payments were suspending and problems for borrowers quickly arose. This is just one facet of the economic problems facing the new president in just a few months, that not only must be addressed, but addressed correcting if problems are not to get worst.

3) The United States has surpassed 11 million coronavirus cases , that’s 1 million new infections in just one week, or 2 million since the beginning of the month. Consequently, hospitals are reaching a breaking point trying to treat nearly 70,000 Covid-19 patients. Medical workers are tired . . . mentally, physically and emotionally exhausted. The stress is being felt around the nation, with the virus spreading like wildfire and the medical system having no backup. If you act early, you can save lives, but if you don’t, you’ll be swamped by a tsunami of this virus. But a Covid-19 vaccine may be in the making with Moderna announcing it has developed a vaccine that’s nearly 95% effective, capable of preventing severe illness, and it could start giving vaccinations to high-risk patients and health care workers as soon as December. A week before, drugmaker, Pfizer announced that its human trials suggest its coronavirus vaccine is more than 90% effective.

4) Stock market closings for – 17 NOV 20:

Dow 29,783.35 down 167.09
Nasdaq 11,899.34 down 24.79
S&P 500 3,609.53 down 17.38

10 Year Yield: down at 0.87%

Oil: down at $41.40

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

10 November 2020

1) The United States became the first nation to surpass 10 million coronavirus infections since the worldwide pandemic started. This is the feared third wave of the Covid-19 virus now surging across the nation. America has reported about a million cases in the past 10 days, the highest rate of infections since the first reporting, while worldwide, coronavirus cases now exceeds 50 million. In the United States the daily average of new deaths account for 1 in every 11 deaths worldwide. The Midwest remains the hardest-hit region based on the most cases per capital with the top five worst-affected states being North Dakota, South Dakota, Wisconsin, Iowa and Nebraska.

2) With Joe Biden now expected to enter the Oval Office, the American workplace is going to look much different. Biden has four decades of union leaders behind him, making him potentially the most labor-friendly president of the U.S., who won the endorsement of almost every major union in the country. Labor reform is a fundamental part of his administration with at least one union leader to be named to his Cabinet. As the coronavirus pandemic continues to drive permanent job losses and compromise worker safety, the case for structural change may be stronger than ever. A sharp turn from the Trump White House on labor policy is expected with the Democrats to reverse the present labor policies. Worker safety enforcement, progressive labor policy with a federal minimum wage of $15 per hour, boost manufacturing via trade, and a more labor-friendly National Labor Relations Board are just some of the areas for major changes to be made. Bill Clinton and Barack Obama push through a wide range of policies, only to have their plans overtaken by other agenda items like health care. But the most important factor being overlooked is AI (Artificial Intelligence) experts are predicting that up to 50% of American jobs will disappear in the next 15 to 25 years. Also, any time you raise the cost of labor, then those jobs will be replaced by automation.

3) Japan moves to reduce its fossil fuel emissions, with Japan being the fifth largest polluter, by using hydrogen fuel for its energy needs. Hydrogen offers the greatest potential to decarbonize industries like steel, cement and heavy duty transport, to achieve net-zero emissions.

4) Stock market closings for – 9 NOV 20: The Dow surged to 1,500 points on news of an effective Covid-19 vaccine trials by Pfizer with early results showing at 90% effectiveness. The Dow was briefly over 30,000.

Dow 29,157.97 up by 834.57
Nasdaq 11,713.78 down by 181.45
S&P 500 3,550.50 up at 41.06

10 Year Yield: up at 0.96%

Oil: up at $39.84

9 November 2020

1) Missouri, in what some are calling the lawsuit heard round the world, is suing China, to hold the global heavyweight responsible for the losses of life and commerce from the COVID-19, which originated in Wuhan, China. Other states are also filing class action suits in U.S. federal courts, but Beijing is aware that sovereign nations, including the U.S., have wide immunity from such claims. Experts warn that a potential decoupling of the world’s largest economies, the United States and China, is causing further concern. Even before the pandemic, there were concerns as China took dramatic steps in recent decades to grow its reach in the world. China is part of massive shifts in the balance of global powers, with some countries reasserting themselves and others finding it difficult to keep up with technological advancements and reap their economic rewards.

2) The giant ExxonMobil has low debt, high yield, and commitment to its dividend. Chevron is like ExxonMobile having a relatively low leverage (in the industry), and long histories of annual dividend increases behind them. But then the pandemic upended the supply/demand dynamics of the oil industry which sent company’s shares tumbling. This has brought the two oil companies dividends into question, and therefore the desirability of the stock as an investment. Major foreign oil companies are facing the same dilemma. Royal Dutch Shell and BP (British Petroleum) have both said they plan to also cut their dividends because of the shift. The dividends can be supported as long as the average oil price sticks around the $40 level.

3) US government has seized a $1 billion dollars in bitcoin as the cryptocurrency rockets past $15,000 per coin, the highest value since January 2018. The organization Silk Road was the most notorious online criminal marketplace of its day, until its founder was prosecuted in 2015 leaving a billion-dollar question of where did all the money go? It remained in the digital wallet for many years before a unit within the Internal Revenue Service, that tracks digital currencies, noticed 54 new transactions from the wallet, prompting the seizure of currency. Analysts noted the movement of more than 69,000 bitcoins in a single transaction from a digital wallet tied to Silk Road founder Ross Ulbricht, which held the fourth-highest bitcoin balance of any in the world. But the Silk Road founder is serving two consecutive life sentences in a maximum-security federal prison, which prompted the government to seized the money, however, the government must prove its case before it can keep the forfeited assets.

4) Stock market closings for – 6 NOV 20:

Dow 28,323.40 down by 66.78
Nasdaq 11,895.23 up by 4.30
S&P 500 3,509.44 down by 1.01

10 Year Yield: up at 0.82%

Oil: down at $37.49

6 November 2020

1) This year’s elections are revealing some interesting things about the new young voters and the society they want. Voters are backing legalized drugs, higher wages and voting restrictions. In Oregon, they have eliminated all criminal penalties for possession of hard drugs. Four other states legalized recreational marijuana. Voters continue to support higher wages with minimum wage settings in states, with Florida raising their minimum to $15 an hour. Abortion encountered more restrictions on the state level. Several states adopted measures, including constitutional amendments, to limit voting rights to U.S. citizens only.

2) The White House task force is warning that new cases of Covid-19 are increasing ‘exponentially’ despite President Trump’s claims that the pandemic would vanish on November 4. Rising case numbers, hospitalizations, and deaths nationwide are causing the task force to sound dire warnings. Recommendations are 1) Do not gather without a mask with individuals living outside of your household, 2) Always wear a mask in public places and, 3) Stop gatherings beyond immediate household until number of cases and positive tests have decrease significantly. The task force is warning states and universities/colleges of the risks during the up coming holiday season and the increase risk of spreading of the virus. States with the highest number of new cases per 100,000 are North Dakota followed by South Dakota, Wisconsin, Montana, Wyoming, Iowa, Alaska, Nebraska, Utah, and Idaho. Vermont remains the state with the lowest number of new cases.

3) Renowned investor Warren Buffett’s (Berkshire Hathaway CEO) favorite market indicator nears record high, signaling stocks are overvalued and riskier than ever for investing. His indicator takes the total market capitalization of a country’s stocks and divides it by quarterly GDP in order to compare the stock market’s valuation to the size of the economy. Currently that’s 168% which signals a record disconnect between asset prices and the economy, and a warning to investors to exercise a great deal of caution towards equities as an asset class. The stock market has never been as expensive as it is today, and not only does this mean that forward returns will likely be exceptionally poor, it means that downside risk has also never been greater than it is today. This indicator also soared before the dot-com bubble burst and surged in the months leading up to the 2008 financial crisis.

4) Stock market closings for – 5 NOV 20:

Dow 28,390.18 up by 542.52
Nasdaq 11,890.93 up by 300.15
S&P 500 3,510.45 up by 67.01

10 Year Yield: up at 0.78%

Oil: down at $38.51

5 November 2020

1) Even with the election stagnated, waiting on the counting of votes to find the winner, the markets were already climbing despite the final results could be days away. The Dow Jones industrial average whipsawed overnight, despite the uncertainty which usually depresses the markets. Nevertheless, the Dow climbed to a peak of over 700 points, with the Standard & Poor’s 500 index and Nasdaq also surging upward. The state of the Senate is also in doubt with neither side having a solid majority, another source of uncertainty. Voter turnout is expected to be the highest in more than a century. Experts expect volatile markets for the coming days, and maybe weeks until the election results are finalized. While bonds have dropped in their yield as expected, oil continues to gain in price. Even the foreign markets are showing an upward trend.

2) China’s new therapy for Alzheimer’s begins a much-anticipated U.S. study, the latest effort in the multibillion-dollar search for an effective treatment for the incurable disease. The drug made by Shanghai Green Valley Pharmaceutical Co. plans a $600 million dollar global Phase III trial. The U.S. Food and Drug Administration gave its approval in April to study whether the drug can produce lasting cognitive improvement among patients in the mild and moderate stage of the debilitating neurodegenerative disorder. The trial will have 2,046 people across China, the U.S. and Europe, the first 600 expected to start in the next six months. The first patients will begin taking the drug in four weeks.

3) Nearly 140 million votes have been cast in the 2020 elections, the most ever in a US presidential election, exceeding 2016’s record of 137.1 million. About 100 million people have voted ahead of Election Day, or about 73.4% of the total votes cast nationwide in 2016. The increased number of early votes is a result of heightened public-health concerns of coronavirus pandemic with in-person voting on Election Day. Several states have taken measures to expand early voting and access to mail-in ballots.

4) Stock market closings for – 4 NOV 20:

Dow 27,847.66 up by 367.63
Nasdaq 11,590.78 up by 430.21
S&P 500 3,443.44 up by 74.28

10 Year Yield: down at 0.77%

Oil: up at $39.11

4 November 2020

1) The peak oil production could come in 2028 due to pandemic, a result of the economic fallout from the COVID-19 pandemic, which suppresses oil demand to such a degree that it will accelerate society’s transition from the fossil fuel. Some analysts predict oil demand will peak at 102 million barrels per day in 2028, two years earlier than predicted before the virus struck. The slow recovery will permanently affect global oil demand levels, lockdowns will stunt economic recovery in the short-term and long-term, while the pandemic will leave a legacy of behavioral changes that will also affect oil use. Right now, global oil demand is averaging about 89.3 million barrels per day, a 10 percent decline from last year, which experts say won’t rebound to those levels until 2023. Despite possible economic fallout governments in Europe and Asia, they are not backing off their clean energy goals. Electric vehicle sales are expected to reach 14 percent of total global car sales by 2025, and reaching 80 percent by mid-century.

2) Norwegian Cruise Line gives up on 2020 with Royal Caribbean, Carnival, and Norwegian Cruise Line Holdings suspended all cruises through the end of November. Resuming cruises have each company installing labs for COVID-19 testing at sea, then put through costly cruising simulations, and then following a number of additional regulations. So getting back to business by next month isn’t feasible anymore, therefore Norwegian Cruise Line became the first of the three giant operators to officially cancel the remainder of its 2020 voyages. Normally, December sailings are lucrative as people seek to leave cold weather behind during the holiday season. The cruise lines may not be able to hold out that long. To survive, companies need protocols that allows them to return to sailing safely, even if there’s a less than ideal experience for customers as well as the companies’ bottom lines. Consumers are already starting to lose faith in this once aspirational mode of leisure travel.

3) This last week, more than 61,000 children in the U.S. were diagnosed with Covid-19, the highest number than any other week. The true number of children with Covid-19 is higher because the illness tends to be mild in kids and because they may not always be tested. A 13-year-old boy has died over the weekend from Covid-19 infection, less than two weeks after he last attended class.

4) Stock market closings for – 3 NOV 20:

Dow 27,480.03 up by 554.98
Nasdaq 11,160.57 up by 202.96
S&P 500 3,369.02 up by 58.78

10 Year Yield: up at 0.88%

Oil: up at $38.15

3 November 2020

1) With the pandemic, working at home became the sudden norm, but now companies are starting to think ‘remote work’ isn’t that great after all. Companies are finding that projects take longer, collaboration is harder, and the training of new workers is a struggle. While many companies thought remote working would be the future, giving many cost savings, they now say this is not going to be sustainable. Some companies had even decided to give up their physical office spaces entirely, which would be a big savings in operating cost. The early productivity gains that companies witnessed with remote work has peaked and leveled off. Few companies expect remote work to go away in the near term, though the evolving thinking among many CEOs reflects a significant shift from the early days of the pandemic.

2) As oil prices continue to tumble, there are world wide concerns about oil and its effect on economies. Global oil inventories fell at a rate of about 2 million barrels a day in September and October, and that trend will probably continue, as demand unexpectedly fell from the lockdown measures. The European Union is accelerating the transition away from fossil fuels, one of its members still sees its own small oil industry continuing for a decade or more.

3) From the start, all electric automobiles have been plagued by their high cost, but now Ford motor company says they have an affordable $20,000 electric car in the mix. This gives a cost on price parity with traditional vehicles using an internal-combustion engine. Ford is returning to its roots with cars for the common working man, having costs for buyers that will range between $20,000 to $70,000 avoiding the sky-high price tags of other electric cars. Ford is expecting future EVs to account for over 10% of the company’s revenue in the future. The Ford Mustang Mach-E was introduce this year, while the electric F-150 EV pickup is set for a debut in 2022. Ford expects to offer a full lineup of electric commercial vehicles in the future, but a $20,000 EV could be just the ticket to get battery-powered cars into the mainstream.

4) Stock market closings for – 2 NOV 20:
Dow 26,925.05 up by 423.45
Nasdaq 10,957.61 up by 46.02
S&P 500 3,310.24 up by 40.28
10 Year Yield: down at 0.85%
Oil: up at $37.09

2 November 2020

1) America’s economy is expanding at a record pace after a historic decline from the Covid-19 crisis. The economy grew at an unprecedented 7.4% pace from the second to the third quarter, which on an annualized basis, would be a growth rate of 33.1%. This would be the highest annualized growth rate on record. While this is undoubtedly positive, it comes with lots of caveats, for the U.S. economy is still in a deep hole with the gross domestic product still about 3.5% below the level recorded in the fourth quarter of 2019. Second, the economy is slowing. Third, there are about 11 million fewer people on payrolls than before the pandemic hit, plus layoffs persist. Finally, the report is a political football with politicians framing the numbers to best serve their individual’s objectives.

2) Cruise ships can begin a phased return to operations starting Nov. 1 under new health protocols. There has been 74 recommendations made for a potential safe return to cruising, including a new focus on “air management”, lower ship capacities, shorter sailing times, required testing and masks, and enhanced cleaning and medical staff on voyages. There are four phases to return to cruising, beginning with cruise ships establishing coronavirus testing of all crew. Phase 2 will be simulated voyages to test the ability to mitigate Covid-19 on cruise ships. Phase 3 is certification by the CDC, and the final phase is a return to passenger voyages.

3) One question this fall is America’s energy future of whether, and to what extent, we should transition from reliable fossil fuels, such as oil and natural gas, to more intermittent sources of energy such as wind and solar power. But arbitrarily halting oil and natural gas development would do serious harm to our economy, and thereby jeopardize post-pandemic recovery. Businesses need reliable, low-cost energy to reopen and return to normal operations, and presently fossil fuels currently accounts for 80 percent of overall American energy production. At the start of this year, the oil and gas industry was responsible for 12.3 million American jobs, while also generating $1.6 trillion dollars in federal and state tax revenue. So if the oil and gas revenue dries up, major public services will be reduced or even cut. The simple fact is that the United States cannot continue on the path of recovery without a thriving oil and natural gas industry because it supports jobs, lowers energy costs for families and businesses, and strengthens our energy and national security.

4) Stock market closings for – 30 OCT 20:

Dow 26,659.11 up 139.16
Nasdaq 11,185.59 up 180.73
S&P 500 3,310.11 up 39.08

10 Year Yield: up at 0.84%

Oil: unchanged at $36.10