Strong Rally to Close Week

imageToday begins to look like an interesting day to think about getting back into the long side of the market.

Not that we will actually be so silly as to do that; the tools over on the www.peoplenomics.com side of the house are not giving us a green light yet and I invented those tools to keep our personal finances out of the ditch since I am one of those people who tends to fall in love with positions.

Still, we have to look at some of the factors that could lead to rational exuberance – and one of them slapped my yesterday on a drive through Jacksonville, TX.

The price of gas at one of the off-brands on the main drag through town was selling Regular for $1.499 per gallon.    

The Triple A National Fuel Gauge Report shows $1.813 nationally this morning against year-ago prices at $2.044.

Since it seems like most of the cars being sold are getting reasonable mileage, it gets me to wondering whether car travel might be poised to make a recovery this year.

While it’s a bit early for thinking about driving vacations this year with the weather still kind of Itchy and Scratchy for a while yet, it is something to think about when the boss isn’t around.

There is a technical problem:  Even with a strong rally today, the market will not have really gone anywhere this week.  Remember that last Friday’s S&P close was 1,906.90.  So the markets need to “put on some beans” today just to get back to break-even.

Even so, the Futures are kinda pointing this way.  Some reasons?

Well in the Pacific, Japan and China were both up over 2 1/2%.  In Europe, France and Germany were coming up on 3/4% increases, but the Brits were up 1.25% already.

If that kind of EUphoria carries West, that would pump the Dow up 200 and something by the close.  And more important, that would breath live back into the S&P and pop a gain of 20-something for the week.  Any port in a storm.

Still, there’s a long ways to the close and being in cash means we can focus on the important part of life:  Trying to figure out who we pissed off in some previous lifetime to end up on this planet for this time around.

And trying to figure out what really matters besides health, heart, and pocketbook.

GDP’ing All Over Ourselves

Hot off the press release:

Real gross domestic product — the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes — increased at an annual rate of 0.7 percent in the fourth quarter of 2015, according to the “advance” estimate released by the Bureau of Economic Analysis.

In the third quarter, real GDP increased 2.0 percent. The Bureau emphasized that the fourth-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see the box on page 4 and “Comparisons of Revisions to GDP” on page 5). The “second” estimate for the fourth quarter, based on more complete data, will be released on February 26, 2016.

The increase in real GDP in the fourth quarter primarily reflected positive contributions from personal consumption expenditures (PCE), residential fixed investment, and federal government spending that were partly offset by negative contributions from private inventory investment, exports, and nonresidential fixed investment.

Imports, which are a subtraction in the calculation of GDP, increased. The deceleration in real GDP in the fourth quarter primarily reflected a deceleration in PCE and downturns in nonresidential fixed investment, in exports, and in state and local government spending that were partly offset by a smaller decrease in private inventory investment, a deceleration in imports, and an acceleration in federal government spending.

I HATE the way BEA writes their press releases.  It’s all self-referential percentages.  You have to really go looking for the number which is the only part that matters.  The rest is soft-shoe and bullshit; heavy on the latter.

If you read long enough, you eventually get to:

Current-dollar GDP — the market value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production — increased 1.5 percent, or $68.1 billion, in the fourth quarter to a level of $18,128.2 billion.

Which could be stated as current GDP is running $18.128 trillion.

Somewhere in here I quote the new H.6 Money Stocks from the Fed and note that in the past 12-months, money at M2 is up 4.7% so GDP isn’t keeping up with the supply of paper and ink to keep pretending we’re profitable.

But then (worse) some dog-ion-the-manger reporter (like, oh, me) will come along and compare that to the Public Debt to the Penny.  Which this morning is $18.963 trillion, So yes, with projected increases in the national debt for the balance of the year, we are happily (and insanely) going down the same road as Greece.

Which is why tomorrow’s Peoplenomics report will focus on the evolution of a Second Depression Handbook.

Eventually, you’ll need it.

Post data, the futures were up only a hundred or so.  Maybe there are some rational people left on the Street, after all. 

But don’t hold your breath.

What Are You Worth?

You see where China is setting up a Social Credit system?  It will rate citizens on how I trustworthy they are.

Be a good little lapdog and don’t think outside the corporate/party lines too far and we’ll let you live…

I’d hate Amazon to rate me based on my reading list and purchase history.  This seems to be the direction, though.  Isn’t it enough I pay promptly?

But it’s the social engineering enforcement side of the PTB.  Question climate change or government policy and you’ll get whacked on the peschewzelwhacker.

Politics:  As Usual

Seems we have a choice of what to believe happened last night.

The NY Times figures that Trump failed to upstage the GOP regulars debate.

On the other hand, here’s a report that last night was no fun for Ted Cruz. GOP insiders- It was a rough night for Ted Cruz.

Who Hacked the IDF?

Well, us, for one as word spreads that US, British spies hacked Israeli air force: reports citing Snowden.

Pandemic Department

Zika virus continues to ramp up into an international pandemic.

Post Oregon

FBI says video shows slain Oregon occupier reach for jacket pocket reports Reuters.

Madness on Bordering Files

Obama administration placed children with human traffickers, report says.  Worst of all, the “ownership” of the kids wasn’t established properly, so a trafficker could claim “Oh, that’s my child” and be off with them.

Die-hard open border fans aren’t going to want me pointing out this was NOT a partisan report, either.  It was an internal HHS investigation.

Wait!  Isn’t there an Executive Order covering this kind of thing?

Did You Know?

That 10 corporations control about half of all online news content?

There Goes the Barbershop

Yet another iconic American place is under attack as mobile continues to grow in the wake of Uber and Lyft.  Here comes a national mobile hair-cutting product:  Interesting news release caught my eye:

NEW YORK, Jan. 28, 2016 /PRNewswire/ — After a year of providing exceptional on-demand handsomeness to busy, professional men in New York City, Shortcut, the preeminent mobile barber service, is releasing an optimized app to begin bringing its grooming services nationwide.

Initially launched in late 2014, Shortcut completely overhauled its product to include more sophisticated design and personalization functions to create an even more fluid experience for consumers and barbers alike.

I have to wonder how soon before other icons of American life fall under the tires.  Got an app yet that can bring me hardware and lumber on command?

If we can do it with pizza and haircuts, why not 2-by-4’s?

Me?  I’m thinking about getting into the mobile BBQ grill business, myself. $30 bucks for a grill and one hour of cooking on it.  Tips would be of BBQ’ed whatever…and let’s see how IRS would want those braised tri-tip tips reported.

Further thinking:

Comments

Strong Rally to Close Week — 15 Comments

  1. Mobile is just today’s version of community. As a kid, we had the only set of real windmill well maintenance tools. We often loaned our pipe cutters and threaders etc. to neighbors. No money exchanged hands.

    And there used to be city parks with bbq’s and picnic tables where people gathered, replaced by millions of decks and bbq’s as people’s social circles grow smaller. I remember having annual picnics with more than a hundred adults and kids in attendance. Hispanics and other second worlders still do this. the Valentine Nebraska sale barn Still has their annual bbq before the first sale of the season, and used to feed several hundred people. Beef, beans and potato salad. Every church loaned their tables and chairs. My parents usually knew 3/4 of the attendees on a first name basis.

    One time we had a family emergency that involved the family car, during a gathering. One of my neighbors handed my dad his keys and said, we’ll hitch a ride home with somebody. That’s what life is supposed to be about in America. It wasn’t about money.

  2. In China, the words for “credit card” translate to “reputation card”.

    You need to understand the culture….

  3. a few days ago (?)you said something about increased quake activity….

    plus a 6+ in Alaska,

    http://www.sfgate.com/bayarea/article/Pair-of-earthquakes-5-0-and-4-9-magnitude-6794120.php

    Just watched a TED talk about how our internet searches are reined in by Google, etc. I’ve noticed it and miss the old wild electronic frontier already. Literally, 2 different people entering the same search term will get completely different results (and you thought they kept their hands out of the ‘cookie’ jar).

  4. One problem with tracking GDP is where do we track “grey and black markets”. How does GDP track gambling, stock trading and all that big money flowing around? With standard GDP tracking and if more and more people start to use cash and barter among their friends and neighbors, I have to wonder if we can even trust anyone with their GDP estimates (which is all they area anyway).

    Everyone should try to determine what a sustainable, steady state economy looks like. Check out Brian Czech’s book Supply Shock. Also his web organization of CASSE dt ORG. We have to do “fine” by holding the line and not relying on economic growth as our only path.

  5. Survival it’s not really about how much money you got course it helps sometimes but survival is about being as close as you can to the things that are around you and understanding how they work same thing goes for the stock market if you do that you have to get as close as you can and understand that but if you’re in the country or if you’re out back somewhere or another planet you need to understand and get it a connection going with that particular thing so that you can survive and you know most people say what how do I make that connection so will you have slowed down Slow down your mental processes and your physical processes and it’ll come to you if it’s like being a kid where your imagination hasn’t been restricted like when you’re an adult use your imagination and you will survive of course that is different from being out in a forest or jungle but if you were trained in a forest or jungle you could survive course there’s always casualties but the secret to success is knowing where you are and moving forward with the knowledge that you have or you can just do like I do disco way out there on the all these different limbs on the tree in st. Wanna try to slam or that one you know anyway if you do like I do you’ll find out all kinds of stuff that normal people that work 9 to 5 do not know

      • ./..yheah, Bryce; some,notg all,us’n,has…er…noticed!???

        (gave the splckr da wkend off)

  6. When I added onto my house, Home Depot took orders over the phone and delivered anything for $90 on a flatbed. Less for small orders. The flatbed shows up with an all terrain three wheeled forklift that hauls pretty much anything the hundred plus yards off the main road, even over unpaved terrain, and plops it down gently. Pallets of cinder blocks, 24 foot structural beams, Hardie board, pallets of Sheetrock, etc. straight to my job site. Lowe’s probably does the same. I did both phone and in person orders, combined, and a semi trailer carries a lot of stuff. They also deliver and haul away appliances. The loader on your tractor is less than half the power of their forklift, so be aware you may not be able to move really heavy pallets with it, even with a fork. And if they pick the lumber, buy premium or some will be deplorably crooked. They also will do cuts to order, which is 50 cents a cut. On plywood it is way easier to order the cuts a day in advance and they have a vey nice saw jig, plus trained cutters who work at night. Half a dollar for a straight 8 foot cut on plywood is my kind of bargain.

  7. The bedrock bond market is on it’s downward spiral. With all indicators in the red, the stock market seems to be on one last kamikaze moon-shot. Is it BOJ or Hillary inspired?

  8. CDC says we have a pandemic with the Zika virus. Thirty-one people who returned from South America have it. How does the new math correlate 31 people with 316 million inhabitants in this country? If you can’t keep the people scared what do you have…

  9. Illegal end-of-the-month “tape painting” which may carry over to the first couple of days in Feb. then it’s back to the inward spiral.

  10. Kuroda – Japan going to negative interest rates – ultimately here, and then BAM your blow-off top as everyone removes their cash from the banks.The worst possible thing they could do. Let’s see if it sticks or he reverses.