1) Markets continue to rise as President Trump delays the actual implementation of auto tariffs. Reportedly, the tariffs are to be delayed for up to six months. Other news helped push the markets up, such as Boeing expects to have its 737 MAX software fix released soon.
2) Monet’s ‘Meules’ is now the most expensive painting ever sold at auction. The painting sold for $110.7 million dollars after an eight minute bidding war at Sotheby’s in New York. This is a crushing return on investment, which was bought for $2.56 million dollars in 1986, giving a return on investment of 4,300%.
3) Prior to the new tariffs, China’s economy was slowing down, showing the fragility of the world’s second largest economy. China’s industrial output, retail sales and investment have slowed more than economist expected. With the faltering of credit coupled with slowing consumption at home, combining with a weaker global economy translates into China running out of steady growth right when it’s most needed.
4) 15 MAY 19 Stock market closings:
Dow 25,648.02 up 115.97 Nasdaq 7,822.15 up 87.65 S&P 500 2,850.96 up 16.55
1) Tensions increase in U.S. – China trade war with increasing fears that the war could be long and painful. In response to China’s new tariffs on $60 billion dollars President Trump is threatening to impose additional tariffs on $300 billion dollars worth of imports. While just a couple of weeks ago, it seemed that China and America were close to reaching an agreement, now it seems both sides have dug in their heels.
2) One military contractor is reportedly making 9,400% profit on a replacement part, a half-inch drive pin. This part should have cost $46 but the government is being charged $4,361 each. Legislation is being considered that would give contracting officers the power to demand data that would back-up billings.
3) Tensions are increasing in the middle east with Saudi Arabia claims of a terrorist drone attacks on pipeline pumping stations. The reports caused a surged in oil prices with fears of possible oil shortages if attacks on Saudi’s oil production continue.
4) 14 MAY 19 Stock market closings:
Dow 25,532.05 up 207.06 Nasdaq 7,734.49 up 87.47 S&P 500 2,834.41 up 22.54
1) Trump’s tariffs went into effect today, at first driving the markets down, but then they recovered to all close high. Trumps statement that talks with China will continue pushed the markets up, while also leaving open the possibility that the tariffs may be soon removed. The tariffs went from 10% to 25% on $200 billion dollars of Chinese imports.
2) With the new tariffs on China, there are concerns for the U.S. economy and that the threat of an increased trade war between China and U.S. will cause a drop in both China’s and American’s GDP (Gross Domestic Product). Declines in GDP is not expected to be limited to America and China, but the global GDP could also suffer too.
3) The apparent contraction of consumerism continues with more than 6,200 stores to close this year. For the last couple of years, the retail industry has been rocked by the number of store closures. The list of retailers include such big names as Payless ShoeSource, Family Dollar, Gap, Victoria’s Secret, Office Depot and OfficeMax, Kmart, CVS, Pier 1 Imports, Bed and Bath, Lowe’s, JC Penny’s and even Walmart.
4) 10 MAY 19 Stock market closings:
Dow 25,942.37 up 114.01 Nasdaq 7,916.94 up 6.35 S&P 500 2,881.40 up 10.68
1) An experiment in four cities is giving four hundred mothers $4,000 dollars per year to test the effects that an infusion of money has on children. The study hopes to answer questions, for children in low income families, about the development of a child’s well being, how their brains work and their behavior.
2) China has promised retaliation if promised tariffs are imposed after mid-night this Thursday. President Trump is tweeting optimism over the coming deal with China, in contrast to China’s threats to retaliate for imposing any tariffs, leaving markets jittery over what may happen.
3) The Public Service Loan Forgiveness program is for relieving people of massive student loan obligations in exchange for working in professions of public service such as teaching, nursing or public-interest law. However the program is in disarray with more than 73,000 people having applied for debt forgiveness. The applicants are frustrated by the poorly written legislation, mismanagement by contractors to process application for forgiveness, and general apathy.
4) 8 MAY 19 Stock market closings:
Dow 25,967.33 up 2.24 Nasdaq 7,943.32 down 20.44 S&P 500 2,879.42 down 4.63
1) Tomato prices could raise 40% from U.S. withdrawing from trade pact with Mexico, called the Tomato Suspension Agreement which expires this Tuesday. This will trigger duties of more than 17% on tomatoes coming from Mexico. Tomatoes from Mexico are selling below domestic production cost.
2) The Dow Jones slid down 648 points, before rising to 473 points on closing, over news that America will impose higher tariffs on Chinese goods late this week. The Nasdaq and S&P 500 also experienced similar significant drops over fears of a full blown trade war with a down turn in global growth and a drop in China’s GDP.
3) Analyst say that a breakdown in the semiconductor field is a warning sign that a trade war with China is coming. This industry is more sensitive to U.S. – Chinese trade tensions. Watch the Philadelphia Semiconductors SOX index, for if the index falls below about the 1,430 level, that indicates trouble.
4) 7 MAY 19 Stock market closings:
Dow 25,965.09 down 473.39 Nasdaq 7,963.76 down 159.53 S&P 500 2,884.05 down 48.42
1) Reports are that China and the U.S. are nearing the conclusion of talks to overhaul their economic relationships. Talks are nearing a point where they will produce a deal or end with no agreement. These talks have been in progress for months and have included tariffs from both sides, and in the process have upset world markets. The biggest obstacle is agreeing on how to enforce an agreement.
2) This March, U.S. consumer spending has increased the most in nine years, driven by purchases of motor vehicles. However, fears of inflation remain mute, giving support to a stronger economic growth in the second quarter.
3) Corporate economists consider there will be slower U.S. growth in the future. They fear the tariffs recently imposed are a drag on growth. Still, they consider the economy will continue to expand, just not at a fast rate.
4) 29 APR 19 Stock market closings:
Dow 26,554.39 up 11.06 Nasdaq 8,161.85 up 15.45 S&P 500 2,943.03 up 3.15
1) The Green New Deal is bringing out proposals for financing the single payer health care proposals. There is a big problem with providing enough health care people such as doctors and nurses to care for the increase numbers of people. Suggestions for finance is an overhaul of present payroll tax combining social security, unemployment and medicare into one flat tax for all of a person’s income. However, apparently there has been no modeling of this strategy to determine its viability.
2) President Trump proposes to drop the preferential trade treatment for India. Presently, there are $5.6 billion dollars worth of Indian goods imported each year into America duty free, while India is imposing high tariffs on US goods imported into India.
3) As Brexit nears, British people and companies are stockpiling goods at an increasing rate, fearful of shortages if a ‘no-deal’ exit occurs. Both business and households are fearful of shortages especially food items first, then things like toilet paper and medicine.
4) 5 MAR 19 Stock market closings:
Dow 25,806.63 down 13.02 Nasdaq 7,576.36 down 1.21 S&P 500 2,789.65 down 3.16
1) The question of ‘monopoly’ for the large tech companies is starting to come to light as a results of congressional questions about the power and influence of such companies as Amazon, Facebook and Google.
2) There are four major retailers on ‘death watch’ for 2019, and they are Barns & Noble, Kmart, JC Penny and Sears. This is particularly important concerning the viability of a consumer based economy.
3) There are talks circulating around Washington of easing the tariffs on China. However, there has been little progress in negotiations, in particular issues of intellectual property.
4) 17 JAN 19 Stock market closings:
Dow 24,370.10 up 162.94 Nasdaq 7,084.46 up 49.77 S&P 500 2,635.96 up 19.86
China is still aiming to produce institutional reforms, among their “trade disputes” with the United States. China is seeking to reform trading and international business practices with the international business community, so they can be apart of a transparent open global economy.
Talks among U.S. and Chinese officials did not amount to any agreement last month (August 2018), but talks seem to be ongoing while many experts believe nothing may come to fruition from the trade talks.
The United States believes it is gaining on the trade war against China, as Chinese economy contracts and their financial markets slow down. -SB