If you’re wondering who won the first debate look no further than to those who’ve been displaced to a country home, or are stuck in the city. The recovery matters to them like never before, and they want the Trump economy back. Good news, it’s happening in a big way, and just in time. My father-in-law, Dick Young writes of America's current economic situation: Since America has begun reducing the severity of its COVID-19-shutdown, the country has seen an incredible economic rebound. The tax and regulatory reforms put in place before the shutdown set the stage for rapid recovery. Today, … [Read more...]
Archives for September 2020
Cracks Form in Fed’s Unprecedented Rate Policy
Cracks could be forming among Federal Reserve officials as some begin to question the feasibility of the Fed's "lower for longer" rate policy. Nick Timiraos reports for The Wall Street Journal: Federal Reserve promises to hold interest rates very low for a long time could pose a dilemma once the pandemic is over: how to deal with the risk of asset bubbles. Those concerns flared when Dallas Fed President Robert Kaplan dissented from the central bank’s Sept. 16 decision to spell out those promises. The Fed committed to hold short-term rates near zero until inflation reaches 2% and is likely … [Read more...]
Consumer Confidence Soars as Economy Reopens
As President Trump and governors like Ron DeSantis and Kristi Noem work to reopen America's economy, consumers are responding with growing enthusiasm. In the Wall Street Journal, Gwynn Guilford reports on September's highest increase in the Conference Board's index of consumer confidence in 17 years. Guilford writes: Consumers are growing more optimistic about the state of the U.S. economy, according to September surveys, as the labor market continued to gradually improve and a summer coronavirus surge receded in parts of the country. The Conference Board, a private research group, said … [Read more...]
Vanguard Proving Why It’s Too Big, Yet Again
Just when you think Vanguard might see the light and get back to its roots, it shows once again why it has become too big and is just like any other money-sucking behemoth--like BlackRock. Vanguard has proven this with the introduction of its own ESG investments program. In my series “You Invest, They Win,” I prove that you are not necessarily front and center, as you most certainly should be when it comes to how your money is invested. This is especially true with the new, hot, investment flavor-of-the-month, ESG. What is an ESG? It’s a marketing tool hoping to get you to feel good about … [Read more...]
New York Just Keeps Getting Worse: 40% Jump in Bankruptcies on the Way
New York City has taken 2020 hard. It's been one of the areas hardest hit by COVID-19, and has seen an unnerving spike in crime and violence. In response the city has been shut down, and many people have fled for greener pastures. Those left behind are now facing bankruptcies and closures. Bloomberg's Josh Saul and Henry Goldman report: (Bloomberg) -- The pandemic has battered New York City businesses, with almost 6,000 closures, a jump of about 40% in bankruptcy filings across the region and shuttered storefronts in the business districts of all five boroughs. It’s going to get … [Read more...]
Once Desolate Country Towns Now Overrun by People Trying to Escape the City
Small towns across America are dealing with something they haven't seen in a long time, population increases. For decades the United States have been urbanizing, as young people left their home towns in search of better opportunities in the nation's cities. Now, a mix of COVID-19 and riots and looting have driven them from the cities. They fled with their families to small country towns, seaside summer homes, and cabins in the mountains. In the Boston Globe, Vermont locals explain how they feel about the new influx of former city-dwellers who have turned up, filling their schools, roads, … [Read more...]
New Deal Creates one of the Largest Independent U.S. Shale Producers
A new deal between Devon Energy and WPX Energy will create one of America's largest independent shale producers. The deal is worth $2.56 billion, and was spurred on by investor interest in consolidation in the Permian Basin's shale oil industry. Rachel Adams-Heard and David Wethe report for Bloomberg, writing: The transaction, which includes a deal premium of about 2.6%, will see Devon shareholders own approximately 57 percent of the combined entity, the companies said Monday in a statement. Shares of Devon and WPX rose, indicating investor enthusiasm for the deal. The plunge in oil prices … [Read more...]
Stock Market Investing for a Secure Retirement
Here’s why I don’t follow the meaningless price or market capitalization stock market averages, especially the likes of the Dow and S&P 500. The S&P 500 Index: only 50 of the biggest cap names account for more than 50% of the total S&P500 Index. The Dow 30: only 10 of the highest priced stocks account for more than 50% of the total Dow Jones Industrial Average. No thanks to index investing in either the Dow or the S&P. Dick Young's Investment Rules Why savvy investors saving for a long and comfortable retirement should always follow RCY’s guide in crafting balanced … [Read more...]
October RAGE Gauge: Stocks Down Over 33% Thrice this Century
With stocks down more than 33% three times now this century, it’s clear that investors have a short-term memory problem—forgetting how bad they felt in March 2001/2008/2020—which is why my RAGE Gauge continues to signal my highest risk level. The new normal we’re living with is a manmade China virus and manmade chaos created by blue state government. Schools are a mess as lawyers lick their chops, ready to pounce with class-action suits, and parents seethe because they want their kids in the classroom where they belong. Anecdotally, at my son’s school, a positive test (kid feels fine) means … [Read more...]
Regulators Zoom in on Blank Check Firms (SPACS)
Special-purpose acquisition companies (SPACS), also known as blank check firms, have become a bit of a fad lately. The excitement around SPACS has drawn the attention of the SEC, which is giving them some new scrutiny. Dave Michaels and Alexander Osipovich report for The Wall Street Journal: Blank-check companies that have raised tens of billions of dollars to acquire hot startups are under the microscope at the Securities and Exchange Commission. Such companies, also called special-purpose acquisition companies, or SPACs, are shell-like entities that go public in order to raise cash for … [Read more...]
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