8 September 2020

1) About two-thirds of the restaurants in New York are expected to permanently close by the end of this year. Restaurants in New York State are not allowed to do indoor dining, only takeout and outdoor dining is permitted. Therefore, a major portion of New York restaurants are unable to meet their revenue requirements without the indoor dinning. Surveys indicated that 64% of restaurant owners are likely to close by the end of this year, and about 55% to shut down before November, which amounts to a collapse of the restaurant industry in New York State. A group of 100 restaurant owners are banning together to launch a class action lawsuit to open up indoor dining.

2) In August, the American economy added 1.37 million jobs, which was above the 1.32 million forecasted by economist. The big winners were the Government and Retail trade, with the 2020 censes accounting for much of the government’s increase in jobs, but like the censes itself, those jobs will be temporary. The job increase in retail is a result of retail stores opening back up, and so those jobs should remain, baring losses from stores closing from failure. With the growing signs that the U.S. economy is improving and jobs are coming back, there is less pressure on Congress to pass a new fiscal stimulus package. The unemployment rate has fallen below 10% to 8.4%, but is still a long way from the 3.5% before the pandemic.

3) The hopes of a comfortable retirement are continually dimming for the youth of America because of a number of reasons. The increase life span after retirement means more money is needed to cover retirement. Retired people are still subject to economic downfalls such as the Great Recession of 08 that robbed workers of earning power. The age of private pensions is gone, with workers now expected to provide all their own retirement out of their own pockets. This goes hand and hand with Social Security’s money reserves dropping as more retirees take their pension. Interest rates are low, making saving for retirement unproductive while the stock market is risky, plus people are reaching retirement with more debt and therefore requiring more money to sustain themselves. The average American needs to have three quarters of a million dollars to retire and be able to maintain their standard of living.

4) Stock market closings for – 4 SEP 20:

Dow 28,133.31 down 159.42
Nasdaq 11,313.13 down 144.97
S&P 500 3,426.96 down 28.10

10 Year Yield: up at 0.72%

Oil: down at $39.51

For- 7 SEP 20:

Dow 28,133.31 down 159.42
Nasdaq 11,313.13 down 144.97
S&P 500 3,426.96 down 28.10

10 Year Yield: up at 0.72%

Oil: down at $39.15

13 November 2019

1) An FAA (Federal Aviation Administration) official states that Southwest Airlines should ground 49 of its airliners that had repairs failing to meet legal standards. The official claims there is a high likelihood of a violation of a regulation, order or standard, so the FAA must take immediate action to revoke the certification of the planes. Aircraft in questions is the Boeing 737 NG which were previously owned by foreign carriers, saying inspections should be speeded up, but fall short of grounding the aircraft.

2) Dean Foods, America’s largest milk producer, is filing for bankruptcy. The 94 year old company has struggled in recent years because Americans are drinking less cows milk. In 2019, sales are down 7%, while for the first half of the year, profits are down 14%, with Dean’s stock dropping 80% in a year. The company is straddled with debt and is unable to fully fund its pensions.

3) The retail giant Walmart is experiencing internal strife over its e-commerce operation with the corporate culture of traditional marketing. Apparently, Walmart’s management doesn’t have a real understanding of the complex technology of e-commerce. The impact of Walmart’s plunge into online retailing has reduced Walmart’s already thin profit margins, which are at historic lows. Some high profile acquisitions and other strategic moves have cratered and talented executives on both sides have departed.

4) Stock market closings for – 12 NOV 19:

Dow               27,691.49    unchanged    
Nasdaq            8,486.09      up    21.81
S&P 500           3,091.84      up      4.83

10 Year Yield:    down   at    1.91%

Oil:    up   at    $56.78

8 October 2019

1) GE (General Electric) announced they will freeze pensions for about 20,000 salaried U.S. employees in order to help the ailing conglomerate cut debt and reduce its retirement fund by $8 billion dollars. Presently, the company has $105.8 billion dollar debt. Their pension plans are among it biggest liabilities and is underfunded by about $27 billion dollars. This move will not effect present retirees who are collecting their pensions.

2) Twenty-one days into the strike, the UAW (United Auto Workers) and GM (General Motors) contract talks have taken a turn for the worse. The snag is product commitments for U.S. factories for new vehicles, engines, transmissions and other items represented by the union. GM is losing $80 million dollars a day, while striking workers are earning about one fifth their regular pay as $260 a month strike benefits.

3) The U.S. railroads slump is getting worse from the slowdown as manufacturing threatens U.S. economy. Trucking is also feeling a slowdown with less than truckload cargos decreasing, although long haul trucking seems to be holding up. Truck rates have dropped, which is pulling some freight business away from trains.

4) Stock market closings for – 7 OCT 19:

Dow                26,478.02    down    95.70
Nasdaq             7,956.29    down    26.18
S&P 500            2,938.79    down     13.22

10 Year Yield:    up   at    1.55%

Oil:    down   at    $52.80

ONTARIO TEACHERS PENSION MAKE UPBEAT WAGER ON MEXICO’S INFRASTRUCTURE!!!!!

infrastructure pic

By: Economic & Finance Report

Canada Pension Plan Investment Board along with Ontario Teachers Pension Plan have teamed up in investing capital in IDEAL, a Latin American infrastructure/building conglomerate.  The partnership combined exceeds 1.35 billion. It said to be one of the biggest projects in Mexico as far as infrastructure and road development. Billionaire investor Carlos Slim own a major stake in the company.

The partnership seems to be beneficial for both parties as IDEAL was seeking funding and the pension funds were seeking to invest their funds in projects that would have logistical impact in Latin America and in Canada. IDEAL trades on the Mexican stock market, and has offices all over Latin America as expands its business and structural model in Mexico and the rest of Latin America. -SB