To The Moon

News and my thoughts from last week (11Nov24)

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• Spending within our means is basic prudence. It's not just about what is accomplished but how it is managed.

• What we need is a realistic mix of news so that we can best navigate and take advantage of the different opportunities presented.

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The average American household spends $270 a week on Groceries - X user Visual Capitalist

• Supply chain has always benefited from global crisis.

• Coming to first principal, we must be ready to change on my when a different set of key information is presented. Thank you The All in Podcast and Chamath

• Container ships continue to line up outside Canada’s busiest import gateway as carriers wait for a lockout of union longshore employees to end. - FreightWaves

• The mortgage rate has risen by nearly 1% since September, even after two Federal Reserve cuts to its benchmark interest rate totalling 0.75%, including a 25 basis point cut announced Thursday. - CNBC

• The Biden administration is planning to rush the last of over $6 billion remaining in Ukraine security assistance out the door by Inauguration Day, per POLITICO

• the loudest does not always represent the majority.

• Chevron is embarking on a cost reduction initiative, targeting $2bn–3bn in structural cost savings by the end of 2026. - Yahoo Finance

From X user The Kobeissi Letter

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US personal interest payments hit $556 BILLION in September, the second-largest in history. Since 2022, Americans' interest costs have DOUBLED. Personal interest as a percentage of disposable personal income is now at 2.5%, near the highest since the 2008 Financial Crisis. This metric is also materially higher than the 2.0% seen in the 1970s when interest rates were almost twice as much as the current 4.75%-5.00% range. All while the total household debt sits at a record $17.8 TRILLION. Consumers are drowning in interest expense.

Is this sustainable? When will the floor give way?

SUMMARY OF FED DECISION (11/7/24): 1. Fed cuts interest rates by 25 bps in 2nd cut of 2024 2. Vote for 25 basis point rate cut was unanimous 3. Fed says risks to goals remain "roughly in balance" 4. Labor market conditions have "generally eased" 5. Fed removes "gaining confidence" on inflation moving to 2% 6. Fed will continue to reduce its balance sheet We expect another 25 basis point rate cut in December.

$10T worth of treasuries would need to be refinanced by 2025. Unless the government intends to inflate their way out of the debt, what options do they have despite the stubborn inflation seen in recent core PCE figure? Between the rock and a hard place?

@TigerStars

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