Joseph G. Witthohn, CFA
VP of Product Development Emerald Asset Management

Good morning.

A 500-point gain in the Dow yesterday was certainly a welcomed sight … especially with the thoughts (and wounds) of October fresh in our minds. But what will the future hold … with a “split” Congress and all? One view – provided in the first article below – is that this will actually be good for business … as it forces government decisions to be made “less badly.”

One thing that might help some businesses is lower transportation cost … assuming (and yes, it is always an assumption) that gas prices will drop with what could be a decline in oil prices. And why might oil prices decline? Not only does there appear to … once again … be present oversupply … but Daily Shot is reporting that capacity is improving in the Permian pipeline which, understandably, could result in even more supply coming into play.

We also have the employment situation … though while unemployment continues to be low … it is taking some employers quite a bit of time to fill open positions. In this regard, University of Chicago Booth School provided a graph to the Wall Street Journal earlier this week showing a marked increase in the average number of working days taken to fill vacant job positions. The article also points out that some firms are being forced to adjust their strategies due to “difficulty filling high-skilled jobs.” I’ll tell you something. It seems to me this would certainly be a great time to be a robot designer.

The final comment I have today deals with the last item included below … an interesting thought that deserves some consideration perhaps. A candidate for president in 2020 feels it would be a smart move to give everyone between the ages of 16-64 … with no strings attached … a monthly check of $1,000! The first concern I had, of course, was how it would be financed … but the claim is it would be covered by a VAT (Value Added Tax) and, at the same time, increase GDP substantially. Of course, I immediately ran to my calculator and figured the “give away” (based on 2010 census data) was $2.76 Trillion which … if this plan did not work … has the chance of crushing our economy.

But at least some people are thinking about ways to improve upon poverty here in the U.S. … which even in “boom” times … seems ridiculously high.

And if you ask why I am so concerned about further increases our debt? I just saw a report that the “cost” of this Federal Debt burden is now at $550 Billion a year!

Maybe now that the election is over we can focus on improving this … but then again … maybe not.

After all … there is a 2020 election right around the corner … and voters love receiving a free lunch … although … deep down … I think we all understand the eventual price that will be paid.

Have a great day,

Joseph G. Witthohn, CFA
Vice President
Emerald Asset Management PA, LLC
610 Freedom Business Center Drive
King of Prussia, PA 19406
Direct: (610) 285-9905
wit@teamemerald.com

… as of 11:31 AM today …

Quick Look at the News

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