30 July 2019

1) The once high flying German Deutsche Bank has run aground rapidly slashing jobs and losing a ton of money. Stock for Germany’s biggest lender is trading at a near all time low. This is a result of poor management and failing to fully clean up its crisis era balance sheet. The banks restructuring efforts have fell short coupled with countless legal black eyes that have all contributed to the bank’s financial woes.

2) The pharmaceutical companies Pfizer and Mylan have announced they are combining to create a global powerhouse in the low price drug market. Pfizer will gain most control of the company with 57% ownership, with Mylan shareholders owning the rest. Both companies lost exclusive manufacture rights from patent expirations, that were big money makers for the companies. Mylan, is the manufacturer of the emergency treatment for allergic reactions, the EpiPen. Mylan has recently been in the news for raising the price of EpiPens by 400%.

3) J.C. Penney, the 117 year old department store chain, is at risk of being de-listed from the New York Stock Exchange. To counter its downward spiral, the company has hired advisers to explore debt restructuring. Penney has $4 billion dollars in debt coming due in the next few years, while its revenues are increasingly being lost to sales on the internet and niche brands. Revenue has fallen over the last three years. The retail giant Sears has suffered similar troubles.

4) Stock market closings for – 29 JUL 19:

Dow                 27,221.35        up   28.90
Nasdaq               8,293.33   down   36.88
S&P 500              3,020.97   down     4.89

10 Year Yield:    down   at    2.06%

Oil:    up   at    $57.13

14 May 2019

1) China has countered U.S. tariffs imposed last Friday with tariffs on $60 billion dollars of U.S. imports to China. About 10 to 15% of America’s import revenues come from China, and while the trade war is high stakes and risky, it’s the only real tool America has to deal with China, because China ignores the world trade organization rulings.

2) Fears are increasing that China may not buy as many U.S. treasury notes as she has in the past, which would force America to increase the prime interest rate. There are even fears that China might not buy any bonds at all, or even start selling off bonds she now holds in retaliation for the tariffs. It’s reported that China is also buying up gold.

3) Boeing aircraft is fearful of being a target for tariff reprisals, who holds substantial orders from China. Apple, who gets 20% of its revenues from China, and Caterpillar are also facing business downturns if China places tariffs on imports of their products.

4) 13 MAY 19 Stock market closings: China’s tariffs announcement turns markets downward.

Dow               25,324.99    down    617.38
Nasdaq            7,647.02    down    269.92
S&P 500           2,811.87    down      69.53

10 Year Yield:     down   at    2.41%

Oil:     down   at    $60.97

8 March 2019

1) Family Dollar store is shutting down 400 of its stores while planning to open another 1,000 stores. Sales continue to drop as the corporation experiments on pricing-product mix to revitalize its revenues.

2) Amazon announced it is closing all of its 87 ‘pop-up’ stores. The pop-up store is actually a kiosk placed in major retail stores that allow people to try out some Amazon products and services. Amazon is exploring other strategies of expanding into the consumer market.

3) Analyst have worried that hiring would slow as the pool of unemployed people shrank, but it turns out that millions of people who had dropped out of the job market and therefore were not being counted as unemployed anymore, are returning to the job market.

4) 7 MAR 19 Stock market closings:

Dow              25,473.23      down      200.23
Nasdaq           7,421.46      down        84.46
S&P 500           2,748.93     down        22.52

10 Year Yield:     down   at    2.64%

Oil:    down   at    $56.44

23 February 2019

1) The worlds largest container shipper, Danish international shipping company Maersk who’s business activities is an indicator of international trade, indicates a trade slowdown. Their revenues are down which is a strong indicator of a global economic slowdown.

2) Twelve empty supertankers are idle because of US domestic oil production is up. US light oil is ideal for gasoline production, but there is not enough supertankers in the Atlantic to export American oil. American oil production is expected to continue rising.

3) Deutsche Bank AG will lose $1.6 billion dollars over the next decade from complex municipal bond investments. The bank paid $140 million dollars for derivatives called credit-default swaps, which was central to the financial collapse of 2008.

4) 21 FEB 19 Stock market closings:

Dow             25,901.13     down     53.31
Nasdaq          7,482.72     down       6.35
S&P 500         2,780.49     down       4.21

10 Year Yield:    up   at    2.70%

Oil:    down   at    $56.84

14 February 2019

1) Criticism continues to mount against the proposed ‘New Green Deal’, in particular the soaring cost it would entail. Although the plan has not been fleshed out enough to do accurate cost analysis, some objectives would need huge expenditures, just when the national debt has topped $22 trillion dollars, making the plan’s future doubtful. The recent massive failure of California’s high speed train and it’s cancellation is another stumbling block to the New Green Deal because it proposes a system of similar high speed trains to replace airliners.

2) The Ford Motor Company announced the recall of 1.5 million of their F150 pickups, which were manufactured from 2011 to 2013. Their six speed transmission has a software problem where it can suddenly down shift to first gear. This could cause loss of control and therefore crashes.

3) Fears are mounting over the $22 trillion dollar American public debt, which is mounting faster than the economy is growing, making it unsustainable. In addition to excess spending by the government, the growing numbers of ‘baby boomers’ retiring leaves not only increased spending obligations for the government, but less revenues coming in, while the younger people are making less monies and therefore paying in less thereby lowering revenues further.

4) 13 FEB 19 Stock market closings:

Dow            25,543.27   up   117.51
Nasdaq         7,420.38   up       5.76
S&P 500        2,753.03   up       8.30

10 Year Yield:    up   at    2.71%

Oil:    up   at    $53.95