Archive for January 2018

While Bitcoin and other crypto-currencies are the rage for some, for others it’s Swiss National Bank shares! Shares are up 320% since 1/31/16 to 5,480 francs ($5,866). Sure, they print their own money, but private shareholders have limited voting rights, the dividend is fixed by law at 15 francs, yielding a paltry return of 0.3%,…

The US has a relatively large $500 billion/year trade deficit, 2.5% of GDP. While tariffs on solar panels and washing machines may slightly boost US manufacturing activity, they may also encourage trade retaliation. Think of China buying planes from Airbus, not Boeing. The only ways to reduce a trade deficit are via boosting savings or…

Inflation-adjusted GDP in 17Q4 grew at a realistic annualized rate of 2.6% after growing at slightly over 3% in 17Q3 and 17Q2. In 2017, GDP grew by 2.3%. While not sizzling growth, it’s pretty good given that this recovery will, in a few months, become the second longest ever. Better yet, due to tax cuts,…

The Friday File: America is clearly aging. The most popular beer in the US in 2017 was Bud Light with a 15.4% market share, down sharply from 16.2% a year earlier. Number two was Coors Light with a 7.6% market share, down from 7.9% in 2016, followed by Miller Light at 6.3%, down from 6.4%…

On the plus side, existing home sales in 2017 hit 5.51 million, their highest level since 6.478 million in 2006. But, existing sales are up trivially from 5.45 million in 2016, and 5.25 million in 2015. Why? A complete lack of inventory. It’s declined for 31 consecutive months Y-o-Y, and at the current sales pace…

2017 was the best year ever for US intermodal (shipping container) loads. Originations were 14.01 million containers and trailers, 2.2% above 2015’s previous record of 13.71 million units. Similarly, truck tonnage grew 7.2% and is also at a record high. By contrast, rail carloads, which specifically exclude intermodal traffic, remain in the doldrums, roughly 20%…

The Fed enters 2018 with no clear plan for raising rates. At the last Fed meeting in December, 6 officials expected two rate hikes or less in 2018, 6 expected three hikes and 4 expected four or more rate increases. More inflation will beget more hikes but how much inflation increases is the great unknown.…

The prime-age population, those persons 25 through 54, number 125 million, of which 100 million are in the labor force. They comprise 63% of the labor force. Since 2000, about 17 million net new jobs have been created. And, all of them have come from the ranks of those aged 55 and older! During this…

The Friday File: 1/3/18 was the last time a US passenger airline flew the iconic Boeing 747. It first flew on 2/9/69, and though designed for up to 660, the Israelis modified it to carry 1,087, service must have been spotty. It gets five gallons/mile and can travel 11,000 miles. It initially listed for $24…

In another sign the labor market is tightening, average overtime in October and November was 4.5 hours/week, tops since mid-2014; up substantially from 4.2 during the first five months of 2017. Back in 2014, OT was elevated out of a fear the economic recovery would stall. Now, there simply aren’t enough people to hire. For…