Archive for June 2018

The Friday File: When 14 mathematicians were given fMRI scans of their brains as they viewed 60 mathematical formulas, the formula that generated the most activity in the brain area stimulated by moral, musical and visual beauty was ei pi+1=0, or Euler’s (pronounced oilers) Identity, which magically links five mathematical constants. Mathematicians and physicists have…

In 18Q1, household debt grew 3.8% Y-o-Y, down from the average growth rate of 4.5% over the previous four quarters. Overall delinquency rates fell because of better performing mortgages and student loans. However, credit-card loans 90 days late reached 8% in 18Q1, up from 7.5% in 17Q1. Worryingly, auto loan delinquencies/100,000 Initial Jobless Claims are…

2016 was the first year since at least 1790 that the white, non-Hispanic population of the US declined. The number of whites fell by 9,000 between 2015 and 2016, and by 31,000 between 2016 and 2017. Conversely, the minority population increased by 4.7 million between 2015 and 2017. Also, there are for the first time…

There is currently a record amount of share buyback activity. While many find this development troubling, it isn’t. First, buybacks really aren’t financial engineering. They total just 2% of stock market value/year, and only 25% of the largest firms that are re-purchasers have EPS as part of their executive pay plans. Second, buyback activity is…

China is the world’s #1 exporter with $2.263 trillion in 2017. Next comes (surprise) the USA, with exports of $1.547 trillion; Germany’s a close third at $1.448 trillion. In distant fourth is Japan, with $698 billion, followed by Netherlands at $652 billion. Canada is 11th at $421 billion, then Mexico at $410 billion. The top…

The Friday File: While Lebron James and Tom Brady are outstanding, Mike Trout may be the finest US athlete. YTD, Trout’s Wins Above Replacement, or victories attributable to him above the number expected from the best available replacement-level player, is 6.6. At this pace, it’ll be 14.5 by year end, ahead of Babe Ruth’s best…

In 18Q1, US household wealth increased 1% to a record $100.8 trillion, or 6.83 times disposable income, close to the peak of 6.85 set in 17Q4, and well above the pre-recession 2006 peak of 6.50. These steady increases in household wealth since early 2009 are juicing the economy less than in previous decades because average…

While May single-family starts are up 18.3% Y-o-Y and multifamily are up 25.1% Y-o-Y, those numbers are deceiving as 5/17 was, by far, the worst month for starts last year! YTD, a better way to compare volatile month-to-month data like this, starts are up a solid 11%, but below the 15% growth rate starts have…

Imposing tariffs on $50 billion in Chinese goods with one-for-one Chinese retaliation will shave one-fifteenth of a point off GDP and cost 100,000 jobs by 2019; manageable. Imposing tariffs on $450 billion, as Trump’s suggesting, would have substantive negative economic impacts, and China might retaliate by devaluing its currency — as China only imports $130…

With crude oil prices near 3-year highs, US shale producers are drilling more and turning profits. But high oil prices are hurting natural gas prices. While global demand for natural gas is projected to rise for many reasons, supply should keep up as shale oil producers unlock vast amounts of natural gas as a byproduct…