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A Christmas Story
When I was growing up in Los Angeles during the fifties, the most exciting day of the year was when my dad took me to buy a Christmas tree.
With its semi-desert climate, Southern California offered pine trees that were thin and scraggly at best, and we didn’t want to chop down the view that we had.
So, the Southern Pacific Railroad made a big deal out of bringing trees down from much better endowed Oregon to supply local holiday revelers.
You had to go down to the freight yard at Union Station on Alameda Street in downtown LA to pick them up.
I remember a jolly Santa standing in a boxcar with trees piled high to the ceiling, pungent with seasonal evergreen smells, handing them out to crowds of eager, smiling buyers for a buck a piece.
Watching great lumbering steam engines as big as houses whistling and belching smoke was enthralling. We took our prize home to be decorated by seven kids hyped on adrenaline, chugging eggnog.
A half-century later, the Southern Pacific is gone, the steam engines are in museums, anyone going near a rail yard would be mugged or arrested for vagrancy, and Dad long ago passed away. Dried out trees at Target for $60 didn’t strike the right chord.
So, I bundled the kids into the SUV and drove to the Eastern shore of Lake Tahoe, on the Nevada side, a $10 US Forest Service tree-cutting permit in hand.
Deep in the forest at 8,000 feet, the kidsmade the decision about which perfect 12-footer to take home. I personally chopped it down and dragged it along the ridge, huffing and puffing all the way. I then tied it to the roof and drove us home. Lifting a 200-pound tree gets tougher every year. Thank goodness the kids are getting bigger.
I netted three trees that day, one for each home, and one for my oldest daughter. I figure I saved myself $600.
With any luck, these memories will last until the next century, long outlasting me.
Now the story really comes full circle. I was in Portland, Oregon, a few years ago, and had some free time to kill. So, I wandered across the river to the Oregon Rail Heritage Center.
What do I see but Southern Pacific engine no. 4449, the exact same locomotive I marveled at in LA 65 years ago, all decked out in its glorious orange and red paint.
It was like discovering a long-lost family member. The 435-ton, 72-year-old behemoth was recently rebuilt from the ground up by a dedicated team of similarly aged volunteers to serve as the city’s Polar Express train in 2014.
For the link to the museum, please click here.
Union Pacific still maintains in running condition some of the largest steam engines ever built, for historical and public relations purposes.
One, the “Old 844” once steamed its way over the High Sierras to San Francisco on a nostalgia tour. The 120-ton monster was built during WWII to haul heavy loads of steel, ammunition, and armaments to California ports to fight the war against Japan. The 4-8-4-class engine could pull 26 passenger cars at 100 mph.
When the engine passed, I felt the blast of heat from the boiler singe my face. No wonder people love these things! To watch the video, please click here and hit the “PLAY” arrow in the lower left-hand corner.
Please excuse the shaky picture. I shot this with one hand, while using my other hand to restrain my overexcited kids from running onto the tracks to touch the laboring beast.
Merry Christmas,
John Thomas
Long Time No See, Old Friend
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Wednesday, December 10, 2025 Salt Lake City, Utah Strategy Luncheon
Come join me for the Mad Hedge Fund Trader’s Global Strategy Luncheon, which I will be conducting high in the western desert in Salt Lake City, Utah, at the foot of the Wasatch Mountains. The event begins at 12:00 noon on Wednesday, December 10, 2025.
A three-course meal will be provided and there will be an open discussion on the crucial issues facing investors today will take place. The dress is business casual.
I’ll be giving you my up-to-date view on stocks, bonds, foreign currencies, commodities, precious metals, energy, China, and real estate. And to keep you in suspense, I’ll be throwing a few surprises out there too. Tickets are available for $276.
I’ll be arriving early and leaving late in case anyone wants to have a one-on-one discussion, or just sit around and chew the fat about the financial markets.
The event will be held in a private room at a downtown Salt Lake City restaurant, the details of which will be emailed directly to you with your confirmation.
I look forward to meeting you, and thank you for supporting my research.
To purchase tickets for this luncheon, please click here.
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Netflix Buys Warner Brothers for $72 Billion,
bringing a swift end to a dramatic bidding process that saw Paramount, Skydance, and Comcast also vying for the legacy assets. The blockbuster deal brings together the streaming giant Netflix, which has upended the media industry in recent years, and the storied Warner Bros. film studio, known for its library, including "The Wizard of Oz," the Harry Potter franchise, and the DC comics universe. It will also include the content of HBO Max, including "The Sopranos" and "Game of Thrones." (NFLX) tanked on the news.
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Elon Musk Fined $140 Million by Europe.
Elon Musk’s X social network was slapped with a lower-than-expected €120 million ($140 million) fine for violating the European Union’s controversial content-moderation law, in a move still set to raise tensions with the White House over free speech and tech regulation.
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Consumer Sentiment Improves.
The University of Michigan's Surveys of Consumers said its Consumer Sentiment Index increased to 53.3 this month from a final reading of 51.0 in November. Economists polled by Reuters had forecast the index rising to 52.
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Bonds See Worst Week in Six Months,
discounting record borrowings next year by the federal government and AI companies. Ten-year US Treasury yields hit 4.14%. The real estate recovery is forestalled once again.
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Core PCE Decelerates for the first Time Since April.
The Fed's preferred inflation gauge slowed down on an annual basis for the first time since April, BEA data for September showed. Core PCE inflation, which excludes food and energy, ran at a 2.8% annual pace in September, a deceleration from August's 2.9% rate. Monthly core inflation came in at 0.2%, in line with August’s numbers.
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Weekly Jobless Claims Drop Dramatically to 191,000,
a 3-year low. It’s most likely a statistical error, but it also coincides with the end of the government shutdown and the run-up to the Christmas selling season. Interest rates spiked up on the news. With the Bureau of Labor Statistics operating at 20% of its regular staff, the quality of the data is going to degrade.
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Layoffs Continue Unabated.
Layoffs announced by U.S. employers fell sharply in November, but hiring intentions continued to lag as they navigated an uncertain economic environment against the backdrop of tariffs on imports and slowing demand. Global outplacement firm Challenger, Gray & Christmas said on Thursday that planned job cuts declined to 71,321 last month from October. They were, however, 24% higher compared to the same period last year, and November's tally was the largest for the month since 2022.
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Snowflake Dives on Weak Forecast.
(SNOW) shares slumped 8% in premarket trading on Thursday after the cloud data analytics company forecast slower product revenue growth for the fourth quarter, partly hit by discounts offered on the large, long-term deals.
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US Dollar Down for 10th Straight Day,
as Fed interest rate cuts loom, thanks to the continuing dire jobs data. Investors have also been weighing the prospect of White House economic adviser Kevin Hassett taking over as Fed Chair after Jerome Powell’s term ends in May. Hassett is expected to push for more rate cuts.
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Costco is Coming off the Bottom,
after a dire six months. Costco’s fiscal first-quarter sales rose 8.2% to $65.98 billion, excluding membership fees, with comparable sales up 6.4%. Digitally enabled comparable sales for the quarter increased 20.5%, indicating significant e-commerce growth for Costco. November net sales reached $23.6 billion, an 8.1% year-over-year increase, with comparable foot traffic up 3.8% worldwide. Buy (COST) on dips.
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ADP Loses 32,000 Jobs in November,
almost entirely by small businesses, which are getting wiped out by tariffs. They lost 120,000 jobs. The last four out of six months have been negative. Education gained 23,000. It increases the chances of a Fed interest rate cut next week.
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Apartment Rents are Falling,
as vacancies hit record highs. It’s due to an oversupply of new units and a slowdown in demand, especially from younger renters. This has led to record-high vacancy rates and the fourth consecutive month-over-month rent decline nationally, reaching a median of $1,367 in November 2025, according to Apartment List. The steepest declines have been seen in markets with high levels of new construction, such as some cities in the Sun Belt, while other areas with more limited supply have performed better.
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US Services PMI Comes in Flat.
The Institute for Supply Management said its non-manufacturing purchasing managers index was little changed at 52.6 last month from 52.4 in October. Economists polled by Reuters had forecast the services PMI slipping to 52.1. Services employment contracts for the sixth month. New orders drop, backlog orders are weak but improving.
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Silver Hits Yet Another New High,
at an incredible $58.65 an ounce. The metal has doubled in 2025 and hit a record high on Wednesday. Supply deficits, a weaker dollar, and concern over the state of the economy have pushed the metal to all-time highs. Silver got its latest boost after ADP reported a surprise decline in private payrolls for November. Buy (SLV) on dips.
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Delta Airlines Loses $200 Million on Government Shutdown,
and the other airlines were hit as well. The airline said the earnings impact would be approximately 25 cents a share for the current quarter. In October, Delta forecast adjusted fourth-quarter earnings of $1.60 to $1.90 a share. Travel demand, however, is still healthy, and bookings are strong going into 2026, Delta reiterated in a securities filing on Wednesday ahead of an industry conference.
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