Financial News vs. Noise
I will be at Inside ETFs from Tuesday to Thursday, so no note those days.
We are ringing the closing bell on the CBOE on 5/23 for the Brendan Wood Top Gun ETF (BWTG) in Chicago. Cocktail reception to follow. If you are going to be in Chicago and would like to come let me know.
RIP. Best investor of all time….
How Jim Simons pioneered quantitative trading and transformed Wall Street-MarketWatch
Renaissance eventually turned into a moneymaking machine. Its flagship Medallion Fund produced gains of more than $100 billion and average annual returns of 66%, before the firm’s outsize investor fees, between 1988 and 2018, according to the Wall Street Journal’s Gregory Zuckerman, who wrote the 2019 biography of Simons, “The Man Who Solved the Market.” The annual gains were 39% after those fees — beating Buffett, George Soros, Peter Lynch and other investors over that stretch, according to Zuckerman. Several years ago, the fund was limited to Simons and his colleagues.
Market’s feel a bit heavy here ahead of big inflation data this week—-PPI on Tuesday, CPI on Wednesday. The market is going to want to see cooler inflation and economic growth slowing (also a bunch of important economic releases). Powell also speaks Tuesday. So unlike last week, with not much going on, this should be an important week as far as the data goes.
Speaking of data. I wonder why the economic reports all paint the picture of a strong economy yet Biden’s polling numbers on the economy suck. I think the economy is in much worse shape than the numbers suggest.
Are Shoppers Really Pulling Back? Retail Earnings Will Offer Clues.-Barron’s
I think they are. Personal debt is through the roof as is inflation, this can’t be good. I will also be looking for signs of stagflation this week. Powell says he doesn’t see it, he is wrong a lot.
Angry shoppers are fighting back against inflation — even the wealthy ones. Companies are feeling it.-MarketWatch
Low-income consumers are especially sensitive to high prices, but A&M’s latest consumer survey found that households across the income spectrum now intend to cut back on spending. Households earning $150,000 to $200,000 reported the highest rates of planning to pare back purchases.
As much as they want to try to tell you it’s come down or it’s because of shrinkflation you know what you are paying at the grocery store or the pump. Consumer sentiment tumbles as inflation fears surge-CNBC.com
Along with the downbeat sentiment measure, the outlook for inflation across the one- and five-year horizons increased.
The one-year outlook jumped to 3.5%, up 0.3 percentage point from a month ago to the highest level since November.
When you are clueless and the data you are looking at is bad, that’s a big problem. The Fed Depends on Increasingly Questionable Data. That’s a Problem.-Barron’s
While the revisions cooled concerns that the economy is overheating, dramatic changes to reported data make it more difficult to discern economic trends overall, including those in the U.S. labor market. And the recent revisions to the jobs data are hardly the only figures that have led economists and analysts to question the credibility of government statistics.
Path of least resistance is to re test the highs, but again feels heavy and going to be data dependent.
Rates popped a bit.
Semi’s had a good day, but closed off the highs.
Gold and the miners are interesting. GDX tried to break out and failed.
Could be setting up as a double top short, but again lots of data. I did buy GDX, PAAS, and EQX on the dips yesterday.
GLD looks like it wants to test the highs.
Self defense stocks got crushed last week. I did buy the dips in SWBI and GEO.
Argentine stocks had a tough week as well. Will be looking to get back into a few on Monday. Names I am watching are CEPU, DESP, and YPF. Not a surprise the media is going after Milei. You don’t pull off the kind of transition he is trying to pull off without some pain.
Argentina’s President Pledged Fiscal Shock Therapy. So Far, He’s Delivering Economic Pain.-WSJ
Can’t help but think the next area to take advantage of in AI isn’t just buying NVDA, it’s all the ancillary things around AI. There’s Not Enough Power for America’s High-Tech Ambitions-WSJ
I think there is something here, just not quite yet. I am not a doctor, but I believe there is a ton of potential in this space. Psychedelic-Drug Stocks Trip Over a Cash Gap as Interest Rates Rise-WSJ
Can’t help but wonder if this is going to be one of “those” articles we look back on later and highlight for how awful the timing was. Wall Street Offloads Crash Insurance as Fear Fades Across Assets-Bloomberg
Appetite to hedge against a stock crash has hit a nine-year low by one measure with fear fading across the options landscape big and small, from equity to fixed income. All told, a Bank of America Corp. indicator of cross-asset stress is flashing benign signals.
Time to get hedges is when they are cheap. As stocks near record highs, a sense of complacency is returning to the options market-MarketWatch
I’m currently long VIX calls. Not quite where it was in December but at the lows of the year
Speaking of the VIX, I can’t remember the last time it mattered for the direction of stocks. Rates and semiconductors. Forget the VIX. This Matters More for the Stock Market.-Barron’s
The normally staid bond market has been on a wild ride for much of this year and last. That could provide clues for where stocks are headed.
I don’t think you can ever assume it is gone. That’s why I love buying dips. The ‘Fed Put’ Is Back, and That’s Great News for the Stock Market-Barron’s
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