10 January 2020

1) HP’s board has rejected Xerox’s $33 billion dollar takeover bid, for the same reason as Xerox’s previous offer, that the proposal significantly undervalues HP. Xerox first moved to acquire HP in November, but was rejected because HP stock holders would lose much of their value in the company. HP is a 2015 spinoff of giant Hewlett-Packard who has a market value of $300 billion dollars that dwarfs Xerox’s value of 7.7 billion dollars.

2) Mack Trucks, the manufacturer of large commercial trucks, announced plans to layoff 305 employees, which is about 13% of their payroll. After two years of high volumes of production, marked demand has dropped so the company must adapt to the lower demand. There are expectations of the truck market in America being down 30% this next year.

3) The American consumer continues to shun the traditional big department stores. Despite the monster holiday shopping season, America’s biggest department stores still lost money. This is a trend that has been in progress for several years as typified by Sears’ decline. Department stores such as JCPenny, Kohl’s and Macy’s continue to decline with dropping sales and store closings. Consumers are now going to big box stores and the internet commerce to save money, signaling a fundamental change in American consumerism.

4) Stock market closings for – 9 SEP 20:

Dow              28,956.90    up    211.81
Nasdaq           9,203.43    up      74.18
S&P 500          3,274.70    up      21.65

10 Year Yield:    down   at    1.86%

Oil:    down   at    $59.59

2 December 2019

1) Deere & Co., the famous manufacture of green and yellow tractors, reported lower earnings blaming trade tensions and poor weather in the U.S. farm belt. Last year’s difficult growing and harvesting conditions have made farmers cautious about investing in new farm equipment. Sales of the construction and forestry division are expected to be down by 10% to 15%, while agricultural is down 5% to 10% next year.

2) Texas oil explorers say predictions of shale production isn’t reflecting the industry’s slowdown. Producers are being starved of funding, stocks have plunged and little interest in public offerings, which may cause a downturn to be more enduring. Seeking to cut costs, drillers have laid off 1,000 workers. There are predictions that U.S. oil production growth will flatten as early as 2021. There is a rapid decline of shale well production, partly a result of placing wells too close together.

3) Global manufacturing has been dragging the world economy down this last year. Weak auto sales have added to the problem, with China’s auto market the worst with a 11% decline in sales. Slow auto sales have cut production at auto plants, with Audi cutting 7,500 jobs. U.S. dealerships are struggling to clear inventory for the new year, with a 12% rise in incentive spending in November, compared to a typical 4%.

4) Stock market closings for – 29 NOV 19:

Dow         28,051.41    down    112.59
Nasdaq      8,665.47    down      39.70
S&P 500     3,140.98    down      12.65

10 Year Yield:    up   at    1.78%

Oil:    down   at    $55.42

28 October 2019

1) The telecommunications giant AT&T is making its belated entry into the streaming video business to compete with Netflix, Apple and Disney. AT&T plans to reach about 80 million subscribers globally, 50 million in the United States by 2025. HBO Max is expanding its customer base into the streaming market through AT&T wireless. AT&T also owns the satellite service DirecTV.

2) The UAW (United Auto Workers) has approved a new contract with GM (General Motors) which ends the six week strike. GM is calling back technicians to prepare the plants to resume production, with production resuming as early as Monday at some plants. The new contract gives workers a series of wage increases and a path for temporary workers to become permanent employees. Permanent workers can earn as much as $32 an hour.

3) The U.S. government has ended its 2019 fiscal year with the largest deficit since 2012. Gains in tax receipts were offset by higher spending and growing debt service payments. The budget deficit has widened to $984 billion dollars, which was 4.6% of the nation’s gross domestic product. Last years deficit was $779 billion dollars and 3.8% of the GDP. Defense, healthcare and social security programs are a major source for driving the deficit, with worries that these expenditures will not be sustainable.

4) Stock market closings for – 25 OCT 19:

Dow             26,958.06    up    152.53
Nasdaq          8,243.12    up      57.32
S&P 500         3,022.55    up      12.26

10 Year Yield:    up   at    1.80%

Oil:    up   at   $56.63

25 July 2019

1) Boeing Aircraft, the manufacture of the now grounded 737 MAX, has not ruled out further reductions or even shutting down production of its 737 MAX. Boeing had cut production of its best selling jet from 52 per month to 42, a 20% reduction. For its second quarter, Boeing has expended $1.01 billion dollars in cash as a result of the grounding, compared to the $4.3 billion dollars of free cash it had on hand last year. With deliveries on hold, Boeing isn’t receiving payments while also footing the cost of aircraft being stored waiting for re-certification.

2) With the commodity prices of coffee bottomed out and depressed incomes, coffee growers in Guatemala are facing a crisis. This crisis is made worse with threats of tariffs on Guatemala over undocumented migrants. Additional remittance fees and sanctions could spell disaster for Guatemala’s principle export if implemented, which in turn may actually exacerbate the flow of migration as small growers are forced out of business and head north.

3) The food giant Kraft Heinz, faced with a large corporate debt, has been exploring methods to pay down that debt by selling off some of its brands, so it can focus on its staple brands such as Heinz ketchup. But the sale of Maxwell House coffee, Breakstone’s sour cream and cottage cheese and Plasmon baby food, has glean lukewarm response from potential buyers. For years, the giant has been run by a ‘cost focused’ management team, but now management considers the company should be driven more by growth. The soup giant Campbell soup faced the same problems earlier this year.

4) Stock market closings for – 24 JUL 19:

Dow              27,269.97    down    79.22
Nasdaq           8,321.50          up    70.10
S&P 500          3,019.56          up    14.09

10 Year Yield:    down   at    2.05%

Oil:    up   at    $55.94

29 April 2019

1) America’s GDP (Gross Domestic Product) for the first quarter of 2019 grew to 3.2%, well above the predicted 2.5% by experts. The US growth makes the American economy the strongest in the world.

2) Exxon Mobil oil company’s profits for the first quarter fell 49% to $2.36 billion dollars. The company is spending more on oil production, while also having lower margins in their refinery business. Exxon is expanding its production in the Permian Basin of west Texas and New Mexico, causing a 42% spike in exploration and production spending.

3) The technology stocks $1 trillion dollar rally continues. The tech sector has outperformed every other industry, with monies pouring into the technology stocks.

4) 26 APR 19 Stock market closings: Again Nasdaq and S&P 500 set record highs.

Dow              26,543.33    up    81.25
Nasdaq           8,146.40    up    27.72
S&P 500          2,939.88    up    13.71

10 Year Yield:    down   at    2.50%

Oil:    down   at    $62.80

NIGERIA & SOUTH AFRICA EXIT RECESSION !!!!!!!!!!!!!!!!

By: Economic & Finance Report

Two of Africa’s biggest economies have officially exited recession.  In the second quarter of 2017, Nigeria’s economy improved by 0.55%, a large part attributed to Nigeria’s growing agri sector (agriculture); as well as Nigeria’s oil production stabilizing again.

South Africa economy grew by 2.5% also attributed by their economy’s agri sector also. Nigeria for the past 25 years had not been in a recession, so when the country contracted this past year; it took many people by surprise, while in South Africa many economic factors played into its recession, especially from the finance sector and government interference tailgaiting corruption scandals. -SB

*The National Bureau of Statistics of Nigeria & South Africa provided current  statistical data*

TEXAS REFINERIES RESTART AFTER COLOSSAL HURRICANE HARVEY!!!!!!!!!

By: Economic & Finance Report

Texas oil refineries began production of oil again Saturday Sept 3, 2017.  This is after a rocky and unstable week presented to the Texas and Louisiana region from the turbulent hurricane called Harvey. Hurricane Harvey being categorized as a Category 4 hurricane, ruined and destroyed billions and billions of dollars of infrastructure and property (residential and commercial); and distablized the southern gulf region.

The federal government has indicated that close to $200 billion will be needed to infuse in the economies; of Texas and Louisiana especially to jump start business initiatives and future business development projects in the region.

Alot of the Texas refineries had to drastically cut production because of the damage Harvey propelled. More then half of the oil refineries in the US is in the Gulf, so when Harvey hit the region, it really made a impact to oil production.

As the refineries begin to resume their productivity, many people and businesses will have to find ways to pick up and resume their lives, from the turmoil this horrible hurricane has inflicted on them. -SB

 

DISCUSSION OF NIGERIA & LIBYA CAPPING OIL PRODUCTION NOT ON TABLE, FOR NOW (OPEC)

By: Economic & Finance Report

 

OPEC has insisted that oil output from Libya and Nigeria are not on the agenda in meeting in St. Petersburg, Russia next month to discus the pact OPEC members currently made to reduce oil supply flow.

Nigeria will cap oil production if it can maintain 1.8 barrels pumping, while Libya wants to maintain 1.25 barrels of oil flow. Libya and Nigeria are currently exempt from the curbing of oil production by OPEC. -SB

IVORY COAST & GHANA PARTNER on COCOA PRODUCTION

By: Economic & Finance Report

Africa’s biggest cocoa producers Ghana, and Ivory Coast, will partner together to increase production of the cocoa bean. Both countries suffered economically because of the declining revenue of cocoa beans.

Presidents of Ghana, Nana-Akufo Addo, and Ivory Coast President, Alassane Ouattara met on Friday to discuss ways of increasing cocoa bean production and better coordinate between countries on increased development of the plant.

Both countries will be working with the African Development Bank, to find ways on capitalizing on cocoa and increasing the revenue in the sector. Ivory Coast and Ghana want to export more cocoa, which eventually helps revenues in both countries. Cocoa sales have suffered within the last several years worldwide and cocoa futures that are traded in global markets, have declined drastically as well; in daytime trading.  -SB

OPEC MAY SOON CURB OIL PRICES…….SOON TO SEE NEXT STEPS………..

opec-pic

By: Economic & Finance Report

Opec may soon be curbing oil prices, after releasing extensive amounts of oil for the past two years, without limitations. Opec is negotiating with Iran other  body members about placing a cap on production, and perhaps reducing production to what it was in the first quarter of 2016.

Saudi Arabia and Opec members have been pumping out almost 34 million barrels a day, this has led US output to increase 11% from previous. Opec is assumed to take some type of action before the end of the year, exactly what transitioning may take place; no description has been presented yet to the media.

There is some speculation that the Saudi led Opec will take on some reduction of the output, maybe before the end of the year. It makes no sense to have increased oil output, when the Saudi’s have already retained the market share, the so called “oil war crusade” with the western oil companies and distributors should be neutralized. -SB