Drawdowns in Recessions
American Express AXP
-85% (2009)
-61% (2001)
-50% (2020)
-12% (current)*
*Friday, AXP equity was 12% off an all-time high. Tiffany (the Blue Box), LVMH Moet Hennessy Louis Vuitton LVMH is at an all-time high.
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Lawrence McDonald
@Convertbond
Father of two, Former Head of Macro Strategy Soc Gen, NY Times Bestselling Author, Long-time Contributor, founder of the
Lawrence McDonald’s Tweets
Capital One COF charge-offs and delinquencies are surging while AMEX is cashing in on the high-end - wealthy consumer - speaks to the two economies inside the USA. Also, see LVMH vs BIG, See UAL vs JBLU - LUV.
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S&P 500 companies so far —— reporting a Y/Y earnings decline for Q4 2022 (-5.0%) for the first time since Q3 2020 (-5.7%).
Via
*ex Energy -10%?
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This is some “bear market” — S&P value index on all time highs.
Two Years
SVX Value: +26%
MGK Growth: -7%
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thebeartrapsreport.com/blog/
Tesla $TSLA nearly 60% off the lows, here’s the important backstory - important read if you missed it.
#JanuaryEffect
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High Beta in 2023
Tesla TSLA +44%
Innovation ARKK +30%
Rare Earth REMX +26%
Lunacy MEME +26%
China KWEB +19%
Semis SMH +18%
IPO +17%
Uranium URNM +16%
Software CLOU +13%
Gold GDX +13%
Home Bld ITB +12%
Biotechs XBI +8%
Cannabis MSOS -8%
vs
DJIA +2%
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Long @CathieDWood and @elonmusk vs. short the grossly overcrowded - hide out - “safe place” industrials…
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Nasdaq 100 is up 11.28% YTD
Best January´s of all time
1999: 15.8%
1997: 12.2%
2001: 10.7%
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What´s going on here?
Big Lots operates nearly 1,430 stores across the US, BIG Rewards Program, which includes approximately 22,000,000 active members. Housing impact, the middle-class consumer is in some pain.
*LVMH strong earnings.
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Off the Recent Lows
LVMH +52% all-time high
BIG +18%
*Ultra high net worth retail at all-time highs vs BIG Lots 78% off the highs, large drawdown. The little guy - gal is hurting. Inequality ALERT.
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Wage pressures at places like Walmart, gasoline up 30% in 30 days, copper names 40% off the lows. Inflation not going away any time soon.
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Thoughts on why the #FederaReserve should hike rates by 50 basis points next week as opposed to the 25 bps widely expected in #markets based on the #Fed signals of the last few weeks.
bloomberg.com/opinion/articl
#economy #centralbanks #econtwitter @opinion
@markets @economics
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LVMH 4Q FASHION & LEATHER ORGANIC SALES +10%, EST. +9.05%
*High end - wealthy consumers are doing just fine. The Big Lots, little guy / gal crowd is another story entirely.
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TSLA +50% off the lows, a nice start to the year vs. 2% for the Dow Jones Industrials.
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St. Louis Fed research: U.S. fiscal stimulus contributed to excess inflation of about 2.6 percentage points domestically
It also was associated with 2.3 percentage points in excess inflation in Canada and 0.6 percentage points in the United Kingdom files.stlouisfed.org/files/htdocs/p
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Do people get the joke? - A “soft landing” nearly guarantees far higher inflation sustainability, and keeps the Fed (call) in play. In 2019, Walmart (2.3 million employees) raised its base wage to $11, the “power of labor” is a large factor - S&P 500 profit margins.
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Walmart is raising wages for its U.S. hourly workers to $14 an hour starting next month, from $12 currently. Its rivals, including Amazon, Target and Costco, all still pay more. wsj.com/articles/walma
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Gratitude...
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Replying to @aunnie
"A Colossal Failure of Common Sense - The Inside Story of the Collapse of Lehman Brothers" by Lawrence McDonald & "Watch that Rat Hole - Witness the REIT Revolution" by Kenneth Campbell" 
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Over the last year, if all you did was buy stocks when the put-call ratio was this low (sub .78), what are your returns 30-90 days out?
- up 10%+36.3%
- flat17.3%
- -10%22.2%
- -20%+24.3%
510 votesFinal results
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Txx revs lost vs. gained vs. fixed costs in states in the question, beware muni credit risk?
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Official
Latest @uscensusbureau data show that New York, Illinois, and Hawaii saw largest loss of population from 2021 to 2022; South Carolina, Idaho, and Florida saw largest inflows (all %s controlled for population size)
@DataArbor @TaxFoundation
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SPOTIFY TECHNOLOGY SA SHARES UP 3.8% PREMARKET AFTER CO TO CUT 6% WORKFORCE
Layoffs up - shares up…
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India - One billion human beings, with no air conditioning.
China - One billion human beings, with no automobile.
*as we export jobs out of the USA, raise the standard of living globally - oil, gas consumption explodes higher. Carbon neutral 2090.
#itsjustMATH
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weforum.org/agenda/2023/01
Here comes the Davos crowd - #WEF2023 is selling the nuclear power solution. After years of criticism and restraint- they are finally doing the math. The road to the green meadow is a uranium yellow. Ask —
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Every cycle...
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35 FACTS NOT LIKELY FOUND ON ARKK YET UNRELEASED 12/31/2022 FACTSHEET
1. Loss from 2/12/2021 Peak: -80.1%
2. CNBC Appearances Since 2/12/2021 Peak: 23
3. Cumulative NET Assets Raised Since 10/31/2014 Launch: $17.1 Billion ($14.5B in 2020 and 2021)
4. Assets at 12/31/2022: $6.0B
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Off the Q3 / Q4 Lows
BASF Chemicals +58%
GLEN Glencore +46%
SX7E Euro Banks +45%
EWG Germany +43%
EWI Italy +41%
GREK Greece +39%
EWP Spain +39%
EWQ France +38%
*Narratives on the lows - "Recession" - "War" - "Gas-mageddon" vs. a USD (global wrecking ball) -11% off the highs.
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After all the talk about the catastrophic impact on the Eurozone from the energy crisis, and sky-high prices for energy imports, it is interesting that the Eurozone current account already bounced back into SURPLUS in the latest official data...
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Off the lows
GOOGL +17%
MSFT +12%
AMZN +17%
META +16%
CRM +14%
*Big tech progressives cashing in on layoffs, how convenient - won´t see this story in NY Times Monday I suspect.
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Google: 12000
Microsoft: 10000
Amazon: 18000
Meta: 11000
Twitter: 4000
Salesforce: 8000
200,000+ laid off in tech since the beginning of 2022. And for no reason other than "everyone else is doing it".
Tech workers need a union.
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2023
ETHE Ethereum +80%
MSTR Levered Bitcoin +70%
BTC Bitcoin +33%
ARKK Innovation +17%
MEME Memes +16%
TSLA Tesla +8%
DIA Dow Industrials +1%
VIX -8%
*Dear Jay Powell, equity options volume is exploding higher, you softened the policy path and re-juiced the junkies.
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Official
Owners’ equivalent rent (OER) portion of CPI continued to soar in December, +7.5% y/y
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What´s going on here?
*Value vs. growth. SCI operates approximately 1,470 funeral homes and over 485 cemeteries in about 45 US states, eight Canadian provinces, the DC, and Puerto Rico.
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Rio Tinto RIO and Teck Resources TECK are up 50 to 70% off the "China Property Crisis" - China Lockdown lows. Oil names XLE are 70 to 100% off the "Omircon" - "Delta Variant" lows - if all you did was buy the media-juiced fear narratives, outstanding returns.
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"China’s economy will rebound strongly this spring and summer after the Lunar New Year, but a lengthy, multiyear U.S.-style consumer frenzy might not be in the offing,
I agree. The rebound will probably not last more than 6-9 months.
wsj.com/articles/chine via @WSJ
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Bitcoin is +40% off the lows with VIX off -12% on the year...
*VIX -23% off the December highs.
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“Next time someone tells you they are long Bitcoin, grab them by the shoulders, look them in the eye and say - "no you are not, you are short the VIX." - @Convertbond
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Off the Recent Lows
Iron Ore +48%
Silver +38%
Copper +35%
Uranium +32%
Aluminum +25%
Corn +20%
Gold +19%
Sugar +14%
Oil +16%
Coal +8%
Wheat +2%
*On Oct 21, 2022 - the Fed softened the path forward with a leak to the WSJ, this is how you nearly guarantee sustained inflation.
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Replying to
I am super pro Ukraine, but relentless escalation is very risky for Ukraine and the world
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Nearly 90% of all Wall St. “strategists” and “economists” have never sat in a professional risk taking seat.
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"Are you long because you like it, or do you like it because you're long."
Junk Bond trading legend, Larry McCarthy
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FED'S WALLER: IF WE ARE WRONG THIS YEAR, IT WILL BE MUCH EASIER TO CUT RATES. :) Gold - Bloomberg
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Split Congress and bonds...
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Bank of America (BAC) CEO Brian Moynihan
Oct 2022 - "The American consumer is resilient,"
Jan 2023 - "Consumer remains resilient"
*Party City, Bed Bath, and Beyond already filed.
*TUESDAY MORNING IS SAID TO NEAR POSSIBLE BANKRUPTCY FILING
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Bankrupt Genesis Owes Its Top 50 Creditors $3.4 Billion
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Tech appears to be going through its very own post-GFC moment.
The austerity isn’t going away anytime soon. After years of excess, 4% rates bite.
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GOOGLE'S ALPHABET PLANNING TO CUT ROUGHLY 12,000 JOBS GLOBALLY
Street "Research" Ratings on GOOGL
Buys: 47
Holds: 4
Sells: 0
*Bottom NOT in until the "Sells" and "Holds" are half the pie.
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Cost of Default protection on the USA, debt ceiling drama Act #1 in Washington.
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"Soft landings" have NEVER killed inflation, not in the history of mankind. If a soft landing is your base case for higher stocks, the Fed has to do a lot more. But THEY told me "Don´t fight the Fed" on the way up, now the Fed doesn´t matter? Narratives are very convenient.
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