To The Moon

News and my thoughts from the last week (15Jul24)

• Bubbles pop.

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There was an assassination attempt on Trump. How would the market react on Monday?

• The jump in PPI appears to be an unwelcome development for the US economy and the fight to rein in high inflation after the BLS announced that consumer prices fell every month for the first time in four years. - CNN

• Elon Musk has said: The European Commission offered 𝕏 an illegal secret deal: if we quietly censored speech without telling anyone, they would not fine us. The other platforms accepted that deal. 𝕏 did not. - Elon Musk

• Russia's GDP grew by 5% in the first five months of this year, despite US sanctions. - BRICS News

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The growth of the S&P500 equal weighted is much lesser than the growth of the S&P500 - driven by heavyweights like The Magnificent Seven. Volatility with the S&P500 will be affected by the Mag7.

• Voting along party lines is a good basis to start. Voting as a citizen for the best of the land, over any political leaning is invaluable. America, we wish you the best. Let's have more collaboration and less sanctions.

• Elon Musk has donated to a super political action committee working to elect Donald Trump to the White House, per Bloomberg. Musk has contributed to a low-profile group called America PAC. It’s unclear how much Musk has given. - Unusual Whales

• With technologies and innovations, should we expect a deflationary impact? The cost of living continues to rise. To a citizen, the returns from AI & innovations have not helped to ease the cost of living. Is it just corporate greed?

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Annualized interest payments on US federal debt just reached an all-time high of $1.14 trillion. This is more than DOUBLE the amount of interest recorded in 2022 when the Fed started raising rates. To put this into perspective, even during the 2008 Financial Crisis, annual interest costs were ~$450 billion, or 60% lower. As a % of GDP, net interest cost this year is on track to exceed the 1980s high of 3.2%. By comparison, during World War II, net interest expense as a % of GDP was much lower, at 1.8%. The US government needs lower interest rates more than anyone. - X user, The Kobeissi Letter

• Ukrainian President Zelensky calls on NATO to drop all limits on striking Russia.

• A potential wave of strikes on the US East Coast this autumn where dockworker contract negotiations are stalling could be a “major wildcard” triggering another round of increases. - Splash247

• AMERICANS WITH ADJUSTABLE MORTGAGES COULD SOON SEE THEIR PAYMENTS SKYROCKET (Fox News) A small group of Americans who took out cheaper but riskier mortgages several years ago are about to see their monthly payments skyrocket. Since 2019, more than 1.7 million homes have been bought using adjustable rate mortgages (ARMs), which initially offer a lower, more affordable interest rate than their fixed-rate counterparts. But eventually, ARMs reset to an unknown future rate, meaning there is a high degree of uncertainty for individuals who take on these types of loans. - MSN

• Governments worldwide owe an unprecedented $91 trillion, an amount almost equal to the size of the global economy and one that will ultimately exact a heavy toll on their populations, per CNN.

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Americans' pandemic savings are gone, per Bloomberg.

• US commercial property crash is set to deepen the pain elsewhere Almost US$1 trillion of debt linked to commercial real estate will mature this year in the US - The Business Times

• “It’s time to cut rates,” said Joe Brusuelas, RSM. “Inflation is fading as the primary focus of concern. The balance of risks is slowly tipping towards higher unemployment.” Interest rate cuts can spiral inflation. - CNN

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The 3-month correlation between S&P 500 returns and the number of S&P 500 stocks advancing dropped to the LOWEST on record. It means that the number of stocks driving gains is the smallest EVER. Notably, 40% of S&P 500 stocks are down year-to-date.

A line chart that displays the U.S. office vacancy rate from Q1 2000 to Q2 2024. The vacancy rate started at 8.3% in Q1 2000, hit 17.6% in 2011, and reached a record high of 20.1% in Q2 2024.

Office vacancy rates reached a record 20.1% in the second quarter — the highest since at least 1979, when Moody's began tracking.

• Cargo ship feared sunk off Cape West coast as storms lash province A total of 18 crew members rescued but fate of vessel unclear as SA Maritime Safety Authority raises concern about pollution - Business Live (ZA)

• Saudi Aramco says combustion engines will be around for ‘very, very long time’ after Horse Powertrain investment - FT

• Artificial intelligence has been a big boon for San Francisco real estate but the vacancy rate for San Francisco office space reached a fresh record of 34.5% in the second quarter, up from 33.9% in Q1. - CNBC

@TigerStars

$S&P 500(.SPX)$