Baltic
Dry Index. 1817 -72 Brent Crude 83.52
Spot
Gold 2380 US
2 Year Yield 4.78 +0.05
Sell
in May, go away, don’t come back till Labor Day.
Wall Street adage.
Though that old Wall Street adage hasn't
been operative since “Bubbles” Greenspan ushered in the era of Wall Street
bailouts by the US central bank, the current stock casinos bubbles reaching new
highs, as everyone front runs the one way street of US and other central bank interest rates cut, make
that old Wall Street adage especially attractive this year.
I mean, in the stock casinos, what could possibly go wrong? Plus there’s another couple of percent to grab out the stock casino bubbles, right?
Dow closes lower
Thursday after briefly topping 40,000 for first time: Live updates
UPDATED THU, MAY 16 2024 4:49 PM EDT
The Dow Jones Industrial Average closed
slightly lower Thursday after briefly jumping above 40,000 for the first time.
At its high of the day, the
blue-chip average reached 40,051.05, the culmination of a bull market that
began in October 2022. The index had neared the 40,000 mark earlier this year
before a slight April pullback on worries about high interest rates knocked it
back down. The rally was rekindled in May on the back of strong earnings and
some soft inflation readings.
Ultimately, the 30-stock Dow
ended the day down 38.62 points, or 0.1%, closing at 39,869.38. The S&P 500 fell
0.21%, closing at 5,297.10. The Nasdaq Composite finished
the day lower by 0.26%, ending at 16,698.32.
During the session, the broader market index
also climbed to a new record after closing above the 5,300 level for the first
time ever on Wednesday, while the tech-heavy Nasdaq hit an all-time high. The
Dow has climbed nearly 6% in 2024, while the Nasdaq and S&P 500 are up 11%
each.
“This achievement is a testament
to the powers of capital formation, innovation, profit growth and economic
resilience,” said John Lynch, chief investment officer at Comerica Wealth
Management. “The recent technical momentum and fundamental strengths, including
earnings and interest rates, suggest further near-term gains.”
It was Walmart that
led the Dow’s charge above 40,000 as the world’s biggest retailer popped nearly
7% on strong fiscal
first-quarter results. Walmart is now up 21% in 2024.
More
Stock market news for May 16, 2024: Dow 40,000 (cnbc.com)
Asia-Pacific
markets mostly fall as investors assess key economic data from China
UPDATED FRI, MAY 17 2024 12:40 AM EDT
Asia-Pacific markets mostly fell Friday, as
investors assessed key China data to gauge the state of the world’s
second-largest economy.
Data
from China showed retail
sales rose by 2.3% in April from a year earlier. The reading
was less than the 3.8% increase forecast by a Reuters poll, and slower than the
3.1% pace reported in March.
Mainland
China’s CSI 300 index fell 0.20% after the data.
Investors
also assessed data from Singapore, which showed non-oil domestic exports in
April declined by 9.3%, slower than the preceding month.
Japan’s Nikkei 225 slid
0.36%, while the broad-based Topix reversed early declines to add 0.26%.
South
Korea’s Kospi was
down 0.93% after the country’s unemployment rate remained unchanged at 2.8% in
April, while the small-cap Kosdaq dropped 1.58%.
In
Australia, the S&P/ASX 200 fell
0.71%.
Hong
Kong’s Hang Seng index gained
0.29%.
Overnight in
the U.S., the Dow Jones
Industrial Average closed
slightly lower, after briefly jumping above 40,000 for the first time.
The
blue-chip index hit a high of 40,051.05. It had neared the 40,000 mark earlier
this year before a slight April pullback on worries over high interest rates.
During
the session, the S&P 500 also
climbed to a new record after closing above the 5,300 level for the first time
ever on Wednesday. The tech-heavy Nasdaq also hit an all-time high.
The
30-stock Dow ended the day down 0.1% at 39,869.38. The S&P 500 fell
0.21%, while the Nasdaq Composite finished
the day 0.26% lower.
Asia markets: China
retail sales, unemployment, industrial production (cnbc.com)
Dow futures are
little changed after blue-chip average touches 40,000 for first time: Live
updates
UPDATED FRI, MAY 17 2024 8:07 PM EDT
Futures
tied to the Dow Jones Industrial Average traded
near flat Thursday night, after the preceding session brought much fanfare,
with the blue-chip average briefly touching the key 40,000 milestone for the
first time.
Futures connected to the 30-stock
index added just 8 points. S&P 500
futures and Nasdaq 100 futures also
both traded near their flatlines.
While it was a modestly
down day for the three major averages, there was no shortage of
excitement among market participants. The Dow reached
an intraday high of 40,051.05, above the psychologically important 40,000
level, before pulling back to end the day down 0.1%.
“The Dow’s remarkable rise has
exceeded many expectations, including my own, but our perspective remains
unchanged,” said Todd Morgan, chairman at Bel Air Investment Advisors. “Through
wars, recessions, elections, impeachments, financial crises and on and on,
investing for the long term in high-quality stocks is the key to building
wealth.”
The broad S&P 500 retreated
about 0.2% on Thursday after breaking above the closely watched 5,300 level for
the first time a day prior. Meanwhile, the Nasdaq Composite finished
Thursday’s session down nearly 0.3% after also reaching an all-time high.
These milestones come amid hopes
that rates have peaked, according to Thomas Martin, senior portfolio manager at
Globalt Investments. Continued optimism around artificial intelligence and
corporate earnings growth also helped push the market into these uncharted
waters, he added.
Despite the weak end to
Thursday’s session, the indexes are on track to end the week with gains. The
Nasdaq Composite is leading the way with a 2.2% advance, followed by the
S&P 500′s 1.4% rise. The Dow is tracking to close the week 0.9% higher.
More
Stock
market today: Live updates (cnbc.com)
Affluent
consumers are creating a ‘bubble’ at Walmart, warns retailer’s former U.S. CEO
Bill Simon
Higher-income consumers may be creating a frothy
situation at Walmart.
Even though affluent shoppers
helped drive the retailer’s latest beat on quarterly results, former Walmart
U.S. CEO Bill Simon warns they’ll be hard to keep.
“The Walmart experience is better
than it used to be, but it’s still not a premium experience. Walmart is built
on convenience, cost and assortment. Not on service,” he told CNBC’s “Fast Money” on Thursday.
“As the economic challenges abate ... service will become more important than
convenience and price. And, we’ll see a shift back of some of the consumers.
That’s the bubble.”
His warning comes with Walmart
stock hitting all-time highs going back to August 1972, when it began
trading on the New York Stock Exchange. Shares surged almost 7%
on Thursday after the discount retailer’s fiscal
first-quarter adjusted earnings and revenue beat estimates. Walmart
reported high-income consumers helped drive profits particularly in its grocery
business.
“The challenge is that the tail
winds that have come from food inflation that have pushed Walmart along will
reverse eventually,” said Simon, who sits on the boards of Darden Restaurants and Hanesbrands
Last October on “Fast Money,” Simon
warned bargains were losing their magic because consumers
were starting to buckle for the first time in a decade. His
call at the time applied to lower-income consumers.
Now, Simon contends higher-income
consumers going to Walmart isn’t good news for the broader economy.
“When money is tight, people react
— even high-end consumers react,” he said.
Despite his bubble warning, Simon
thinks Walmart is a “great investment” over the next 12 months.
“As long as there’s inflation and
those tail winds that come from particularly from food inflation, more traffic
will come to the Walmart store,” said Simon.
More
Walmart
bubble due to high-income grocery spending, warns Bill Simon (cnbc.com)
In other real world news.
China consumption
slows as retail sales and investment data disappoint
BEIJING — China
reported data Friday that pointed to slower growth on the consumer side while
industrial activity remained robust.
Retail sales rose by
2.3% in April from a year ago, the National Bureau of Statistics said. That was
less than the 3.8% increase forecast by a Reuters poll, and slower than the
3.1% pace reported in March.
Industrial production
rose by 6.7% in April from a year ago, beating expectations for 5.5% growth.
That was also a marked pickup from 4.5% in March.
But fixed asset
investment rose by 4.2% for the first four months of the year, lower than the
4.6% expected increase.
Real estate
investment steepened its pace of decline, and was down 9.8%
year-on-year for the first four months of 2024.
Infrastructure and
manufacturing investment during that time both slowed their pace slightly from
the level reported as of March.
The urban
unemployment rate in April was 5%. The bureau has previously said it would
publish the breakdown by age in the days following the overall data release.
Retail sales grew by
6.8% year-on-year during a recent holiday period from April 29 to May 3,
according to China’s Ministry of Commerce.
The ministry said
retail sales of home appliances rose by 7.9% during that time, while that of
automobiles climbed by 4.8%, boosted by nationwide trade-in incentives.
“Major indicators of
industry, exports, employment and prices improved overall, with new driving
forces maintain[ing] rapid growth,” the bureau said.
Some consumers who
are uncertain about their future income and other aspects will remain cautious
about spending, said Bruce Pang at JLL.
More
China
economy: April retail sales, industrial production, investment data (cnbc.com)
Finally, in more of, so you really,
really, really want to own an EV. Volvo’s EV sales are collapsing.
With other EV manufacturers
desperately cutting EV prices as sales collapse and EV inventory piles up, Volvo
is paying the price of not joining in the price cutting war.
Tesla gets sued for a fiery EV
crash.
Volvo’s US EV Sales Crater 69% In Q1
Can
Volvo achieve its goal of going all-electric in 2030?
May 14, 2024 at 16:33
Volvo has ambitious plans to
transition to all-electric vehicles by 2030, aiming for EVs to make up half of
its global sales by 2025. However, 2024 has proven to be an abysmal year for
its electric models in the States, with sales plummeting by a whopping 69
percent through April.
In the first four months of
2024, the automaker sold just 1,298 EVs to American
buyers versus
4,138 the same period last year. This figure stands in contrast to the
simultaneous 55 percent increase in sales of its plug-in hybrid models,
totaling 10,124 units, and a 15 percent rise in overall sales from 36,094 in Q1
2023 to 41,555 in Q1 2024.
---- Currently, American
shoppers have a limited selection of fully electric vehicles at Volvo dealerships: the XC40 Recharge
and the C40 Recharge. Both are small crossovers that have garnered critical
praise. However, they come with starting prices of $52,450 and $53,600,
respectively before incentives.
That’s
significantly more than the Tesla Model Y,
which can be had from $44,990 this week, before any incentives. The American EV
has had its price changed more times that we can remember in recent months,
often dropping to lower levels, something the Swedish automaker has refused to
do.
The
company’s refusal to engage in a price war has left dealers in the U.S. feeling frustrated.
They’re grappling with the challenge of selling these expensive compact
crossovers at a time when MSRPs are a significant concern for shoppers. On the
other hand, this means that Volvo maintains a 16 percent gross margin on each
example it sells.
More
Volvo’s US EV Sales Crater 69% In Q1 | Carscoops
Wife of Tesla recruiter who was 3x drink-drive limit
when autopilot car crashed in fireball sues company
May
12, 2024
The widow of a man who died
after his Tesla veered off the road and crashed into a tree while
he was using its partially automated driving system is suing the carmaker,
claiming its marketing of the technology is dangerously misleading.
The Autopilot system
prevented Hans Von Ohain from being able to keep his Model 3 Tesla on a Colorado road in 2022, according to the lawsuit filed by
Nora Bass in state court on May 3. Von Ohain died after the car hit a tree and
burst into flames, but a passenger was able to escape, the suit says.
Von Ohain
was intoxicated at the time of the crash, according to a Colorado State Patrol
report. He was three times the legal limit according to analysis of his
blood-alcohol level in the autopsy report, according to the Denver Post.
The Associated Press sent an
email to Tesla's communications department seeking comment on Friday.
Tesla offers two partially
automated systems, Autopilot and a more sophisticated “Full Self Driving,” but
the company says neither can drive itself, despite their names.
The lawsuit, which was also
filed on behalf of the only child of Von Ohain and Bass, alleges that Tesla,
facing financial pressures, released its Autopilot system before it was ready
to be used in the real world. It also claims the company has had a “reckless
disregard for consumer safety and truth," citing a 2016 promotional video.
More
Global Inflation/Stagflation/Recession Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Biden's big political problem: Inflation is now up nearly 20% since he took office
May 16, 2024
Inflation cooled slightly in April,
but even the slower price increases revealed this week still added to a tally
that is perhaps the Biden campaign's most intractable economic challenge in the
2024 campaign season.
Prices as measured by the
seasonally-adjusted Consumer Price Index (CPI) are now up over 19.4% in the
three-plus years since Biden took office.
Cumulative inflation has been a GOP focus for months, and that continued Wednesday as new data showed the
tally inching ever closer to a psychologically significant milestone of 20%.
The Trump
campaign didn't even wait for the threshold to be crossed Wednesday, with a
statement from the campaign press secretary flatly stating "overall prices
are up 20%."
Trump himself, as he is tends
to do, exaggerated the numbers further and largely beyond recognition. In
a video response to
the inflation report, he said without offering any evidence that inflation
"takes away 30 to 50 percent of every dollar you have."
President Biden himself
reacted to the latest report with a statement calling
costs his top economic priority while acknowledging that "even though
we've made progress we have a lot more to do."
For comparison's sake, prices rose
just under 7.8% during the 4 years of Donald Trump's presidency.
Economists often note that the
differences between inflation in the two eras are due to a range of factors far
beyond the Oval Office occupant.
More
Biden's
big political problem: Inflation is now up nearly 20% since he took office
(msn.com)
US Credit Card Debts Rise, More Americans Become Delinquent: NY Fed
The
share of maxed-out credit card users is rising along with debt default rates.
5/16/2024 Updated: 5/16/2024
Credit card
debts and delinquency rates among Americans increased in the first quarter of
2024, with newly delinquent individuals having a high median credit card
utilization rate of 90 percent.
Household credit card debt in the United
States rose by $129 billion over the past year, reaching $1.15 trillion as of
Q1 2024, according to the latest data from the Federal Reserve Bank of New York. In Q1
2023, the share of credit card debt that was 90 days or more delinquent was
4.57 percent.
This jumped to 6.86 percent in Q1, 2024. The rate of credit card debts transitioning into
“serious delinquency continued to rise across all age groups,” said Joelle Scally, the regional economic principal within the household and public policy research division at the New York Fed.
“An
increasing number of borrowers missed credit card payments, revealing worsening
financial distress among some households.”
In a May 14 post to Liberty Street Economics, New York Fed
economists noted that a key factor “strongly correlated” to future defaults is
the high utilization rate of credit cards. The aggregate credit card
utilization rate was roughly 23 percent in the first quarter.
However, this varied based on users. Fifty-two percent of borrowers “were using less than 20 percent of their available credit in the first quarter, while 18 percent of borrowers were using at least 90 percent of their available credit.”
Borrowers who
were “current” on their cards had a median utilization rate of only 13 percent.
Those who became newly delinquent this year had a median utilization rate of 90
percent.
“This makes
sense, since using practically all of your available credit could indicate a
tight cash-flow situation,” according to the report, which noted that credit
card utilization is a key input in credit scores used to determine the
probability of defaulting in the future.
More
US
Credit Card Debts Rise, More Americans Become Delinquent: NY Fed | The Epoch
Times
Covid-19 Corner
This section will continue until it becomes unneeded.
AstraZeneca's
COVID Vaccine Linked To Another Blood Clotting Disorder
May 16, 2024
Things seem to be going from bad to worse
for AstraZeneca as a
new study has claimed that its COVID-19 vaccine raises the risk of
vaccine-induced immune thrombocytopenia and thrombosis (VITT) - a rare but
fatal blood clotting disorder. The study, conducted by researchers at Flinders
University in Australia, found the presence of PF4 antibodies, which were
previously red-flagged by scientists from Canada, North America, Germany, and
Italy in 2023.
"An unusually dangerous
blood autoantibody directed against a protein termed platelet factor 4 (or
PF4)" was identified as the reason for VITT.
They found
that the PF4 antibodies in both adenovirus infection-associated VITT
and classic adenoviral vector VITT share identical molecular
fingerprints or signatures. "Indeed, the pathways of lethal antibody
production in these disorders must be virtually identical and have similar
genetic risk factors," said Professor Tom Gordon from Flinders.
The researcher noted that the
"findings have important clinical implications, as lessons learned from
VITT are applicable to rare cases of blood clotting after adenovirus
(a common cold) infections, as well as having implications for vaccine
development".
The findings come close on
the heels of AstraZeneca admitting in a UK court that its COVID vaccine
"can, in very rare cases, cause TTS".
More
AstraZeneca's COVID Vaccine Linked To Another Blood
Clotting Disorder (msn.com)
Technology
Update.
With events happening fast in the
development of solar power and graphene, among other things, I’ve added this
section. Updates as they get reported.
The H Stands For Hype
The
New York Times calls hydrogen a “renewable energy source” and other silliness
about using an element that’s “a thermodynamic obscenity”
MAY 09, 2024
The Sun is mainly made of
hydrogen. But there is nothing new under
the Sun, and that includes hydrogen.
That Old Testament
reference — “what has been will be done again; there is nothing new under the
sun” — is appropriate here because the hype about hydrogen seems nearly as old
as the Bible itself.
On June 10, 1975,
during the 94th Congress, the House of Representatives held the first of two
“investigative hearings on the subject of hydrogen — its production,
utilization, and potential effects on our energy economy of the future.” The
hearing was chaired by Mike McCormack, a Democrat from Washington state, who claimed hydrogen
“has
the potential of playing the same kind of role in our energy system as
electricity does today.”
In 1996, the Chicago
Sun-Times declared “The first steps toward what proponents call the
hydrogen economy are being taken.” In 2003, Jeremy Rifkin, an “economic
and social theorist,” published The
Hydrogen Economy: The Creation of the Worldwide Energy Web and the
Redistribution of Power on Earth. In that book, Rifkin claimed that
“Globalization represents the end stage of the fossil-fuel era.” Turning
“toward hydrogen is a promissory note for a safer world,” he averred.
---- Presentism helps explain why, on April 30, the New
York Times published a piece headlined, “Hydrogen
Offers Germany a Chance to Take a Lead in Green Energy,” which ignores the long history of hydrogen’s failure
to live up to the forecasts. But blaming presentism can’t account for the
vapidity of the article, which hinges on this nut graf:
The concept of hydrogen
as a renewable energy source has been around for years, but only
within the past decade has the idea of its potential to replace fossil fuels to
power heavy industry taken off, leading to increased investment and advances in
the technology. (Emphasis added.)
The idea of hydrogen
may (or may not) be taking off, but hydrogen is not a “source” of energy, it’s
an energy carrier. Calling hydrogen an energy “source” is like calling Stormy
Daniels an “actress.”
Hydrogen is abundant in
the universe. But it’s not a source of energy. Instead, like electricity and
gasoline, it must be manufactured. The most common ways are by splitting water
through electrolysis, or via steam-methane
reforming, which uses high-pressure
steam to produce hydrogen from methane.
There are other
forehead-slapping statements in the Times article written by
Stanley Reed and Melissa Eddy, who traveled to the German city of Duisburg to
visit a factory that makes electrolyzers. “If adopted widely,” they wrote, “the
devices could help clean up heavy industry such as steel-making, in Germany and
elsewhere.” Well, yes, if “adopted widely.” But despite decades of frothy
predictions from Rifkin and others, electrolyzers haven’t been adopted widely
because making and using hydrogen on a large scale is — as my friend, Steve
Brick, puts it — “a thermodynamic obscenity.”
Reed and Eddy ignore the energy intensity of making hydrogen,
only offering that by using “electricity to split water” the electrolyzer
“produces hydrogen, a carbon-free gas that could help power mills like the one
in Duisburg.” That’s true. But how much electricity is needed? And where the
heck is German industry, which is already
being hammered by expensive gas and power, going to get the juice? At what cost? Those questions are
not addressed.
To be clear, lots of other media outlets are hyping hydrogen.
And the hype is surging because of fat government subsidies.
---- Regardless of tax credits and subsidies, making and
using hydrogen is a high-entropy, high-cost process. As a friend in the oil
refining business told me last year, “If you like $6-per-gallon gasoline,
you’re gonna love $14-to-$20-per-gallon hydrogen.”
As for Brick’s “thermodynamic obscenity” line, the numbers —
which I’ll examine in a moment — are easy to understand. Hydrogen is insanely
expensive, in energy terms, to manufacture. It takes about three units of
energy, in the form of electricity, to produce two units of hydrogen energy. In
other words, the hydrogen economy requires scads of electricity (a high quality
form of energy) to make a tiny molecule that’s hard to handle, difficult to
store, and expensive to use.
More
The H Stands For Hype - Robert Bryce (substack.com)
Next, our
latest new section, the world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
Another
weekend and a late Spring, easy pickings, free money, weekend in the northern
hemisphere stock casinos. Have a great weekend everyone.
One of
the most helpful things that anybody can learn is to give up trying to catch
the last eight – or the first. These two are the most expensive eights in the
world. They have costs stock traders, in the aggregate, enough millions of
dollars to build a concrete highway across the continent.
Jesse Livermore
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