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  • July 24, 2020

    1. Weekly Jobless Rise to 1.4 Million,

      the first increase since March. It gives credence to my double-dip “W” scenario for the economy, with unemployment about to soar and mass evictions to explode. The airlines have already lost 400,000. Yesterday was the first time in ages the stock market noticed that prices can fall. Put on your hard hat. This down cycle could be worse than the last and the government is running out of money to plug the dyke.

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    2. Warren Buffet Bought $800 Million Worth of Bank of America,

      taking his total position up to near 10%. I am buying banks on dips too. The yield curve is about to steepen sharply, and they are massive beneficiaries of government subsidies through all the stimulus loans. Buy banks on dips.

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    3. Intel Gets Crushed,

      with the shares down 20%, as the pandemic forces product delays. Margins are down 53.3%, the worst since 2009. Another legacy tech bites the dust.

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    4. Disney Delays Star Wars,

      and Mulan is put off as well. (DIS) takes a dump. How many have died since Disneyland in Orlando reopened? This is going to be a really boring Christmas.

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    5. Airlines are Flying Planes Empty to Keep Pilots Current,

      and to keep the engines from rusting out. With flights down 78% from the peak, it is their only option. It would be cheaper to do it in a Cessna 172. Haven’t they heard of simulators?

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  • July 23, 2020

    1. Tesla Posts Profit in Q2,

      bringing in $6.0 billion in revenues versus $5.4 billion expected. This is when every other company was posting the worst results in history, especially auto companies. Shares are up $100 in the aftermarket. Elon announced a second $1.1 billion US factory in Austin, TX, which will build the futuristic Cybertruck. I’m on the waiting list. The pandemic affected (TSLA) like water off a duck’s back. The company took in $428 million in credits from other carmakers because of their failure to keep up on electric car production. Addition of (TSLA) to the S&P 500 is a slam dunk when all indexers will be forced to buy the shares.

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    2. Existing Home Sales Up a Blockbuster 20.7%

      in June, to a seasonally adjusted annual rate of 4.7 million. The flight to the suburbs has become a stampede. That’s three consecutive months of increases. Homes are spending less time on the market, only 24 days. Keep buying homebuilders on dips.

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    3. Chipotle’s Online Sales Triple,

      as the pandemic drives consumers to their burgeoning takeaway business. Talk about a company that had success drop in its lap. Now, if they can only keep food poisoning at bay, a past problem for (CMG).

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    4. The US Dollar is in Free Fall,

      as the coronavirus ravages the US, which Europe enjoys a full-scale recovery. The buck is down 8% from the highs, a big move in the currency markets. The more money you print, the less valuable it becomes. Keep buying the Australian dollar (FXA) and Euro (FXE) on dips. Weak leadership brings a weak currency.

       

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    5. US Deaths to Hit 300,000 by Yearend,

      says Dr. Scott Gottlieb, an epidemiologist. Hospitalizations will hit a new record in the coming months, and the government action to stem the disease has failed miserably. Looks like I’m spending another year in quarantine and my kids won’t see a school until late 2021. Read it and weep. 

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  • July 22, 2020

    1. Gold Hits New Nine-Year High,

      as widely predicted here, and it is going much higher. Silver now has gotten the bit between its teeth, rising off a massive base. The pure play here is Silver Wheaton (SLW), a play on a recovering global economy.

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    2. S&P 500 Hits New 2020 Highs,

      but most of the upside has been in two dozen tech and biotech stocks. It’s the most focused stock pickers market I have ever seen, and we picked ALL the winners.

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    3. United Burns $1.6 Billion in Q2,

      and massive layoffs loom. Large scale groundings of aircraft are the only thing saving the company here. The entire sector has become a vaccine play, which is at least a year off. Avoid airlines like the plague.

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    4. SNAP Snaps,

      with a dismal earnings report, with back-to-school canceled. They plan to make it back by eating Facebook’s lunch, the subject of a global boycott over their lax hate speech controls. In Silicon Valley, everyone is prey.

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    5. Elon Musk Scores Another $2.1 Billion Payday.

      And why not, with the stock up 110X from the lows. The problem is that he has to spend it on Mars. He can fix that. All eyes are focused on (TSLA) Q2 earnings, out after the close today.

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  • July 21, 2020

    1. Gold Ready to Hit New Highs in Weeks,

      says Citibank strategist Ed more. He sees $2,000 an ounce in five months, up 10% from here. This will be the “safe” trade in any stock market selloff. Government printing presses running wild, collapsing US dollar, and central bank buying are the usual suspects. Keep buying (GLD) on dips.

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    2. Europe Passes $857 Billion Stimulus Package,

      and some of that will be spent in the US. Stimulus anywhere in the world right now is a positive for everyone, but this is much too little too late.

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    3. Some 17,000 Southwest Staff Accept Buyouts.

      The airline that remains will be half the size of the old one, if it exists at all. Most airline support ends in September. Avoid like the plague. They bought too much of their own stock at the top, so there is nothing left to run on at the bottom.

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    4. Europe Hits Four-Month High,

      The Oxford Vaccine Moves Forward, with pharma giant AstraZeneca getting a good immune response in early human trials. We’re getting closer to a permanent fix for the economy.

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    5. The Oxford Vaccine Moves Forward,

      with pharma giant AstraZeneca getting a good immune response in early human trials. We’re getting closer to a permanent fix for the economy.

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  • July 20, 2020

    1. We Haven’t Scratched the Surface on Pain and Suffering Yet,

      says my old friend JP Morgan CEO Jamie Diamond. A second corona wave will drive unemployment to 23% by yearend, right when state and federal stimulus money runs out. His bank has added a gargantuan $15.7 billion in reserves to weather the coming storm. (JPM) does business with half of all US households in some form or another. Additional stimulus may be limited, or not come at all. Republicans are transfixed on liability limits for corporations, while the president is demanding a payroll tax cut that only benefits the employed. Democrats insist on aid for the states. There is no common ground here. The worst is yet to come. Makes stocks look kind of expensive 5% short of all-time highs.

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    2. CDC Extends “No Sail Order”

      to the end of September, as Florida Corona cases go ballistic. Opening Disneyland in Orlando doesn’t look like such a great idea now. Will Mickey get infected by his adoring fans? On another front, California is going with an online-only model for school reopening in August. Many teachers are preferring early retirement to death.

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    3. Building Permits Up 2.1% for June.

      However, single family homes jumped an eye-popping 11% as Millennials flee to the suburbs. Keep buying homebuilders on dips. They are in the sweet spot with record-low mortgage rates and a gigantic demographic tailwind.

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    4. What’s Going on in the TIPS Market?

      While the stock market is predicting a rosy “V” recovery, Treasury Inflation-Protected Securities are anticipating an “L”. TIP pricing is now discounting a fall in ten-year US Treasury yield to negative 200 basis points, down from the current 0.62%. This divergence won’t last forever.
        

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    5. Apple Maps Meta Data Show the Recovery is Stalling,

      Apple Maps Meta Data Show the Recovery is Stalling, based on user direction requests. If people are going nowhere, they are not spending. Not good for stocks.