The S&P 500 moved into intraday record territory again this morning before settling back a bit as earnings appear to be in focus and warning signs ignored … as the hope is inflation and the number of covid-variant cases will not worsen.
Speaking of inflation, it seems the Chairman of the Fed is not too worried right now and feels this will “moderate” over time … but try telling that to a senior on fixed income who, upon seeing the price of a steak nowadays … is probably rushing out to make an eye appointment, thinking their vision is going on them. I heard from a restaurant owner on Long Island who said she is forced to raise prices on something as simple as hamburger, due to the cost of the ground beef … and I read that some restaurants in the Baltimore/Washington area are taking crabs off the menu due to the high wholesale prices. That reminds me … I had better get to Costco today and grab a few tins of jumbo lump crabmeat … just in case I get a hankering for crab cakes in the coming days.
In case you are wondering (which you are probably not), Daily Shot reports the market has priced in a 25 bp increase in rates in December 2022. That’s a long way off. If we keep seeing prices jump the way that have been this could be moved up quite a bit … we just have to hope the Fed’s assessment that things will come down is correct.
A second concern, by the way, continues to be the virus … as Associated Press is reporting the number of cases doubled in the past three weeks. It is still small compared to last year, but the simple act of compounding (doubling every three weeks) is quite worrisome to those looking 2-3 months out. Of course, it could be an outlier or a matter of when data is reported (keeping in mind the old saying that if you torture a statistic long enough it will confess) … but it certainly is something to watch.
On a final note for today, I included information showing how much big cities around the world contribute to greenhouse gases. What is concerning here is how many of these areas are in China. We can do (and should do) all we can in the U.S. to control our own contribution but if one big country doesn’t slow things down, what we do on a local level might not help much. The funny thing about pollution is that it doesn’t stop at any border. A problem anywhere is a global one.
That’s it for today … as mentioned, I want to go to Costco before prices go up.
Then it is off to the liquor store.
I finally decided to quit drinking for good.
Now I drink for evil.
Have a great day,
Joseph G. Witthohn, CFA
Emerald Asset Management PA, LLC
610 Freedom Business Center Drive
King of Prussia, PA 19406
Direct: (610) 285-9905
cell: (856) 625-7915
… As of 11:41 AM today …
Quick Look at the News
It does not appear that the Fed will be adjusting rates any time soon as the expectation is for the high inflation seen of late to moderate (CNBC)https://www.cnbc.com/2021/07/14/powell-says-the-fed-is-still-a-ways-off-from-altering-policy-expects-inflation-to-moderate.html
... and so we might be able to move on to other concerns … such as climate change. It seems half of the world’s greenhouse gases are from 25 cities … with most of these in China (DailyMail)https://www.dailymail.co.uk/sciencetech/article-9779781/Climate-change-Just-25-mega-cities-emit-52-cent-worlds-urban-greenhouse-gases.html
… but not only is air pollution a concern … but other environment-related things such as sea level. Now there is warning that the next decade could see problems … all because of the moon (Axios)https://www.axios.com/nasa-moon-wobble-coastal-flooding-c4623977-31be-44d6-a73a-1da9107f3316.html
A troubling sign is the increase in the number of virus cases. Sure, it is small … but doubling over-and-over again would result in some big issues in a few short months (APNews)https://apnews.com/article/coronavirus-pandemic-us-cases-rising-03150d6404004711b80e9bd6ff0d410d
This is a story I need to hide from my kid. Macaroni and cheese ice cream is now a “thing” and while it sounds kind of gross I might be tempted to try it myself … just to see (USAToday)https://www.usatoday.com/story/money/food/2021/07/13/kraft-macaroni-cheese-ice-cream-van-leeuwen/7953751002/
… and remember how it was said that 60 is the new 40? Now they are saying 100 is the new 60. Hold on! Does that mean 100 is the new 40? (Entrepreneur)https://www.entrepreneur.com/article/376402