Markets are mixed this last day of July, but there is little for investors to complain about … at least as far as stocks are concerned, as there is a chance we will see our 4th monthly gain in a row.
Still, there is a bit of worry about the weeks ahead as a stimulus battle is going on in Washington and people seem to be starting to wonder just who is going to end up paying for any generosity. But it is not only stimulus payments on the minds of some … as a growing number of Americans are questioning the government’s future financial ability to support Social Security … as the pandemic has certainly affected payments into the system … and could be forcing many to be withdrawing funds sooner than was anticipated pre-virus.
Not only have inflows into Social Security been affected, but state and local governments depend on taxes … both sales taxes and gasoline. And with savings rates increasing substantially of late, and commuting cut down quite a bit … a lessening in tax dollars collected puts a strain on budgets for this year and next. Obviously, a cut in some services could be in the cards.
The GDP number reported yesterday was … in a word … terrible … and news headlines were fast to announce it was the worst in history. Well … this morning Daily Shot supplied a chart created by Deutsche Bank Research that shows there were four quarters in which the decline was actually worse (1921, 1932 twice, and 1946).
Speaking of Daily Shot … today is the last day they provide their free newsletter to Wall Street Journal subscribers. If you want to continue, a subscription ($100/year) is required. I made sure to sign up as I find their daily commentary to be invaluable.
For those who are wondering, there will not be a charge to receive my own daily note. It is free (but keep in mind you get what you pay for) though I tell people the information I provide is priceless … as I’ve always lived by the motto:
“If you don’t toot your own horn, you’ll go through life with an untooted horn.”
On a final note, I will admit there is a bit of concern that we will have another shutdown … which is why both the stimulus and virus cases (and deaths) are being watched so closely.
I just went back-to-school shopping for my kid. Do you know what I bought him? Clothes … for both of us … which is easy since his classroom is right next to my kitchen.
It seems that the first day of school, he and I will be wearing the same thing.
Have a great weekend,
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 11:51 AM today …
Quick Look at the News
There is a battle going on in Congress over the next stimulus and with decision makers starting to leave for the weekend, it doesn't seem that any resolution will happen soon (CNBC)https://www.cnbc.com/2020/07/30/coronavirus-stimulus-updates-relief-bill-talks-continue.html
... and it is not only on Capitol Hill where questions of affordability are raised. Some on Main Street worry about Covid fiscal effects ... and wonder if Social Security will be reduced (CNBC)https://www.cnbc.com/2020/07/30/more-worry-about-social-security-running-out-of-money-amid-covid-19.html
Yes, the virus disrupted so many things ... and one more food place is suffering. California Pizza Kitchen filed for bankruptcy protection ... as lack of indoor dining is hurting (TheDailyBeast)https://www.thedailybeast.com/california-pizza-kitchen-files-for-bankruptcy-caused-by-coronavirus-shutdowns
... but there are more things to worry about than the pandemic ... as the headline-grabbing situation with climate change and sea level rise has not gone away (Gizmodo)https://earther.gizmodo.com/sea-level-rise-alone-threatens-to-crush-the-global-econ-1844557915
We see all different types of masks ... from the basic to the pretty fabric ... and even, recently, the neck gaiter. Neck gaiters ... simply pull them up ... but are they effective? Yep (USAToday)https://www.usatoday.com/story/tech/reviewedcom/2020/07/30/neck-gaiters-vs-face-masks-they-effective/5544515002/
As the number of cases continue to rise ... how do Americans feel about sending their kids back to school? It seems they are not very comfortable at all (USAToday)https://www.usatoday.com/story/news/politics/2020/07/31/covid-19-survey-fewer-americans-favor-sending-kids-back-school/5547243002/
... and what is interesting is that new things are being tried in education ... to make sure the kids get what they need. And once the virus is gone ... some things might remain in place (Time)https://time.com/5870132/schools-coronavirus/