To The Moon

News and my thoughts from last week (09Dec24)

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67 $SPX companies have issued negative EPS guidance for Q4 2024, which is above the 5-year average of 56 and above the 10-year average of 62 - X user FactSet

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FOMO (Fear of missing out) can be a crippling emotion that can drive us to buying too late & selling too early. Emotional management is key to long-term success. I have exited some of my positions as weakening fundamentals or overvaluation provide opportunities to take profits & stop losses. Let us take stock of our 2024 lessons, adding refinement and better controls to our investing strategy for 2025.

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The Conference Board Leading Economic Index® (LEI) for the US declined by 0.4% in October 2024 to 99.5 (2016=100), following a 0.3% decline in September (revised up from a 0.5% decline). Over the six-month period between April and October 2024, the LEI fell by 2.2%, slightly more than its 2.0% decline over the previous six-month period (October 2023 to April 2024). - CBO

• November 2024 Logistics Manager’s Index Report® LMI® at 58.4 Growth is INCREASING AT AN INCREASING RATE for: Inventory Costs, Warehousing Capacity, Warehousing Prices, Transportation Capacity, and Transportation Utilization. Growth is INCREASING AT A DECREASING RATE for: Inventory Levels, Warehousing Utilization and Transportation Prices. - the LMI

• The dual threats of tariff hikes and port strikes continue to buttress ocean freight rates through what is historically a post-peak trough. - Freightwaves. 

  How supply chain benefits from the different challenges.

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US-based firms announced 57,727 job cuts in November, the third-highest number since the 2008 FINANCIAL CRISIS. Year-to-date there have been 722,566 job cuts, the largest amount since 2009 (Financial Crisis), excluding the 2020 Crisis. - X user Global Markets Investor

• OPEC+ WILL INCREASE OIL OUTPUT UNTIL SEPTEMBER 2026 - IFX. X user Financial Juice

• If our investments are causing us sleepless nights, let us consider reducing our portfolio. To gain wealth in exchange for health is never a good deal. Money - we can always make it if we are in good health. I am not sure about vice versa. I prefer to take long-term positions so that I can go on and enjoy this “limited” life that I have. Let us find the investing strategy that works well for us. keep well and avoid leverage.

• Be thankful for the profits that we took. It is hard to buy at the bottom & sell at the peak. Profits need to be realized. The market seems overvalued and let us remember to take some profits off the table. Personally, I have exited 75% of my crypto.

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Mag 7 just reached its lowest volume in years. The last time we had similar conditions, it was very close to a significant top. - X user Guilherme Tavares

• S&P500 is a better reflection of some top MNCs. This index is not a reflection of the US economy. Unless debts can trend in a different direction, hedging should be considered. Don't leverage.

• In November, $176.5 million across nine loans were resolved with $100.0 million in losses total, carrying an average loss severity of 56.67% for the month. This was an increase in loan loss volume from October where losses totaled $47.3 million. - Trepp

• E-commerce to drive air cargo industry expansion through 2043 - Yahoo Finance

• Egyptian authorities are scrambling to salvage the VSG Glory, a cargo ship that began sinking after being stranded for 10 days at the Red Sea - Reuters. What are the financial & ecological impacts? - Reuters

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• OIL major Exxon Mobil Corp. is considering a sale of its gas stations in Singapore, which could raise about US$1 billion, according to people familiar with the matter. - Business Times

• China told the U.S. to find its own gallium, germanium, and antimony, slapping a ban on these high-tech minerals used in chips, batteries, and even military gadgets. The move? Payback for U.S. export controls on Chinese chip-making tech. The U.S. depends on China for over half its supply of these minerals, and with prices already soaring—antimony’s hit $25,000 per ton—this ban might sting. Hope those chip factories find a Plan B fast. China calls it “protecting its rights.” Critics call it “trade war 2.0.” Either way, the tech world just got a whole lot more expensive. Source: AP

• Banks that issue credit cards used by millions of consumers raised interest rates and introduced new fees over the past year in response to an impending regulation that most experts now believe will never take effect. - CNBC

• CHINA’S TRAINS SURPASS PLANES' SPEED WHILE THE US KILLS ITS POTENTIAL WITH USELESS REGULATIONS China's next-gen maglev trains, capable of reaching 1,000 km/h, aim to outpace aeroplanes using magnetic levitation in near-vacuum tubes. Powered by 5G for seamless communication, these high-speed marvels showcase China's leap in transportation technology. While Beijing pushes the limits of innovation, U.S. progress remains bogged down by regulatory overhead. Will the U.S. reform its systems to compete, or risk falling behind in the face of other countries’ relentless advancements?

• In 2024, Berkshire Hathaway, Buffett's investment behemoth, is set to rake in $776 million in Coca-Cola dividends alone.

From X user The Kobeissi Letter

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The number of hires as a % of total employment fell to 3.3% in November, the lowest level since 2020. Over the last 3 years, the hiring rate has declined by 1.3 percentage points, the biggest decline on record. In effect, the hiring rate has been below the pre-pandemic average of 3.8% for 14 straight months. This also puts the hiring rate significantly below the 2001 recession levels. Outside of the pandemic, we are now seeing the biggest drop in the hiring rate since 2008. The US labor market is freezing.

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How bad the US debt crisis has become? US net interest payments on national debt hit a $1.12 TRILLION annual rate in Q3 2024, a new record. This is TWICE the amount seen in 2021, according to the Bureau of Economic Analysis data. As a result, interest as a % of government revenue hit 18%, the highest in 30+ years. Interest expense now exceeds government spending on R&D, infrastructure, and education COMBINED. Meanwhile, the national debt reached $35.95 TRILLION this week, a new all-time high. Something must change here.

The authorities need to be both effective and efficient. Let us consider sustainability as part of the equation. The future generation would be forced to carry the weight of debt. This is fiscal mismanagement.

@TigerStars

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