| | | Hi Bob,
....
I have seen you have excellent success numerous times using the 2cs and the CLX locating times when the market is rolling over and preparing for a decline and conversely you have spotted numerous occasions where the market was washed out and ready for rally mode..... I love your disciplined approach, as well as
your total yield strategies where you pick up a nice dividend yielding company, by getting it put to you having written a put on the stock below the market, thus enhancing your over all return... It's been a very neat
approach of accentuating the overall return on your position.
You used the approach on HCP (health care properties) last Friday....... I respect your precise accountant
styled approach to calculating effective yield and total return using that strategy...
The United States1. Let’s begin with the NFIB small business report.
• The overall sentiment index came off the highs but remains elevated.
• More firms are planning to increase inventories over the next few months.
• Small business hiring plans are at the highest level in a decade.
And labor quality remains a problem. Anecdotal evidence suggests that in some areas of the country, finding workers who can pass a drug test has been challenging. ( that is proving to be a bigger probl)em than one might think)
Skilled (and drug-free) worker shortages in construction are especially acute.
Source: John Burns Real Estate Consulting
2. US household economic optimism has worsened. Some of the declines could be related to the hurricanes.
3. US prime-age population has not increased in a decade.
Once the unemployment rate stops declining (and we are close to that level – chart below), it will become increasingly challenging to boost the speed of economic expansion. Slow productivity improvements and a stagnant labor force size will hold back the GDP growth (second chart below). The policy of tightening legal immigration makes the situation worse.
Source: BMI Research
4. As discussed previously ( #7 ere) the broad money supply growth in the United States is slowing. Does it suggest weaker inflation ahead? ( it's kind of surprising.... as it seems as liquidity is so rampant.... The hurricane have
sucked up discretionary dollars in Texas , Louisiana, Florida, Georgia and SC
Source: @DriehausCapital
5. Nomura sees the GOP succeeding in its efforts to cut US personal taxes by one trillion dollars over the next ten years (in Q1). The team, however, is skeptical about a corporate tax cut. Here is the impact of the tax legislation on the various economic metrics.
Source: Nomura Global Markets Research
6. According to a forecast from John Burns Real Estate Consulting, residential construction in the US has peaked for now. While single-family building permits are expected to climb gradually, they will be more than offset by fewer multifamily construction projects. We will have more on the topic later in the week.
Source: John Burns Real Estate Consulting
7. Renovations of vacant homes are on the rise.
Source: John Burns Real Estate Consulting
8. The hurricanes have brought forward some of the spending on building materials.
Source: John Burns Real Estate Consulting
9. The amount of equity Americans are taking out of their homes (via refinancing) is a fraction of the peak reached during the housing bubble. Nonetheless, it has been rising as home prices improve.
Source: John Burns Real Estate Consulting
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3. This chart shows some Brexit scenarios. The “hardest” Brexit (#7) could be quite damaging to the economy.
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The Eurozone1. Investors have taken quite a bit of money out of the largest Spanish equity ETF.
This Catalonia situation appears to have stabilized for now, sending Spain’s stock market higher.
2. The euro bounced on Tuesday. 1.16 proved to be nice support!!!
Here is the euro risk reversal, pointing to higher demand for EUR/USD call options (investors betting on the currency’s appreciation).
Speculative bets on the euro’s appreciation also remain elevated in the futures market.
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