MARCH 28, 2020. Spring is sneaking in as our attention is splintered.
We’re petting the cat and peeling thunder and pouring rain won’t stop that.. We’re now under the gun and if that hasn’t rocked your socks then you’re ready for that chaise lounge helium trip up to the stratosphere. Remember that guy in California and his helium balloon lawn chair? He got a call from the FAA. What’s next when both the light and the air grow thin?
Light and air in market terms mean the essentials and the giants: phone, power, and those near a trillion. The smart and savvy warned us earlier that tech would be autopsied in all this. It was. Yet, the Stay-at-Home ecosystem means more of the bigs–more band width, for more remote working, more gaming, streaming, online shopping. Hum, who does all that?
China brewed this virus and it’s now demonstrating this expanding tech truth pushing up behind. We need more not only from VZ, T, and UPS, but also from GOOG, AMZN, and MSFT. That leads us right back to thinking big. When the economic storm boils you wanna bunk with the bigs. That’s why we’re having a “Brain Pill. Two Minutes. MSFT v. GOOG.”
MARCH 18, 2020. Centennial storms happen more frequently now. Thus the “once in 100 years” line is wholly meaningless. Canned goods are still good, and still canned. Katrina was tragic and also an apt analogy to our market, and now our economy.
The Ka Ka’s sharply hit the props when TV waves bow beneath the weight of canned policy verbiage from Capitol Hill and your closed library. That’s why Reed Hastings built Netflix.
Meanwhile, financial facilitation and relief thinking is said to be coursing on Capitol Hill. We’ll see. Much of what the Fed actually does exists below the media line. Only financial professionals even understand the repo market and Fed actions that maintain liquidity.
The fed’s doing those things. Yet banks and REITs are disastrous.
The Fed’s for real, but not alone. Being informed is essential, but bathing in “we’re making sure” isn’t. We’re watching closely yet shuffling in a dose of “the Hunker.”
MARCH 16, 2020. Markets go down, and they go back up. Today is neither the first, nor the last, time it feels like we’re all about to take a “DIRTNAP.”Read more
MARCH 11, 2020. Back in 1957 Toyota landed at a derelict Rambler dealership deep in Hollywood. Nobody noticed. “Made in Japan” meant junk. Detroit owned American driving, and had since the beginning. During the mid-80’s the Japanese auto invasion reached critical mass. Buyers had noticed the quality difference. Detroit was caught lame, dopey, and bloated. The junk rolling off their production lines looked good, to them. Buyer felt otherwise.
Meanwhile, Japan’s spiritual egalitarian management style was producing a lean and reliable product line. Fuel economy mattered as well, and those quality-packed offerings carved up the U.S. auto market like a Samurai sword.
And it was business as usual for Detroit. Ford and Gm have habitually leaned backward rather than toward a transformative future. During the Yom Kippur War in 1973 OPEC hit an oil addicted west with an oil embargo. Gas lines wrapped around the block as motorists physically pushed eight cylinder boats toward busy pumps.
Oil trouble sent Detroit halfheartedly toward EV thinking. The obstacles were huge. Did they keep thinking long-term? No. The second oil again flowed they jettisoned the entire EV concept and packed their shaky prototypes into the crusher. They didn’t even leave an EV pilot light sparking. Now Tesla’s all over their backs.
The marvels of Detroit are many, including their repeated myopic refusal to tool for any future beyond next year. Detroit is a come from behind operator. That’s why Ford’s now an “F BOMB.”
MARCH 9, 2020. The Saudis want to cut production but Russia won’t play. So the Saudis cut the price of their crude and that wave’s rocking equities.
A million things move markets and some roil them. Either way we play our game plan. Today’s no different. Know that “Breathe. Today’s the Plain Leading Toward Distant Peaks.”
MARCH 7, 2020. Visions are power. Back in 1969 the Saturn 5 boosted the Apollo Program into our collective imagination. That summer cars were personal and SRBs tumbled in silent grace back to Earth. The vision above bloomed for all to see on the bright side of the moon. Vision turned reality.
Space X lands solid rocket boosters upright on the launch pad. That’s different. The sea doesn’t need them. That’s the power of vision. Elon has an EV vision. Musk is a legitimate visionary, and a charismatic lightening rod. Tesla, his EV car company is on the lie detector presently, seeking a true valuation. None exists–not really. The market simply spins one up by the day. Think spinning Twister dial.
Investors believe in Elon’s visions, and Tesla’s future. They cling to Musk’s future with their dollars. That’s nice, and tradeable. Now Tesla is a legitimate phenomenon, busy making a believer of the wider market. It’s not luck when you only build 365 thousand cars annually, yet sport a market cap larger than Ford and GM combined. Riding the wild vision, “Windows Down. Tesla.”
FEBRUARY 28, 2020. Fear is a feeling rather than a circumstance. Investing money calls for a longer-term perspective, and only those who show up will win. The game’s not over. Thursday was the largest single point drop in market history. But that was yesterday. What now?Read more