• Pandemic Pricing

    For the nine months ending 3/20, 14% of all homes purchased were priced at $500,000 or more. Between 4/20 and 6/20, that percentage jumped to 25%! Relatedly, since the start of Covid-19 home buyer median income is $110,800 compared to $94,400 for pre-pandemic purchasers. Not surprisingly, the … [Read More...]

  • Election Elucidation

    This is the 59th US presidential election. The first and only one to be held in an odd numbered year saw George Washington defeat John Adams in 1789. Adams, Jefferson, and Madison followed. Those were candidates! The Adams’ were the first couple to live in the White House. President George H.W. Bush … [Read More...]

  • Overwhelming Outlays

    The FY2020 (10/1/19-9/30/20) budget deficit of $3.1 trillion more than tripled from $984 billion in FY2019. As a share of GDP, the deficit rose from 4.6% to 15.2%, the largest since 1945. Revenues totaled $3.4 trillion, down just 1% from a year earlier, as revenues from Oct-March rose 6% due to … [Read More...]

  • Safety Seats

    Since 1977, and especially since the mid-1990s, states have steadily raised the age for which a child must sit in a car safety seat. These laws have saved 60 lives/year. So few because seatbelts are as safe as child car seats for children over two. These laws have, however, reduced births by … [Read More...]

  • Carbon Contraction

    In 2013, Exxon’s market capitalization was $415 billion, and it was the most valuable firm in the world. Today, it’s worth $180 billion. In 2008, energy comprised 13.3% of the S&P 500, today, it’s 2.5%. Recently, the Dow Jones Industrial Average bid adieu to Exxon, the longest tenured firm in … [Read More...]

Nov
06

Risqué Ratings

The Friday File: Since 1968, the Motion Picture Association of America has rated movies. Studios seek movie ratings because major theaters will generally not show unrated films. In 1984, the PG-13 rating began. Since then, very few G or (dreaded) NC-17 rated films have been released. PG-13 movies … [Read more...]

Nov
05

Emptying Enrollments

Overall undergraduate populations shrank 4% this fall, compared to just 1.1% last year, and freshman counts declined by a whopping 16.1%, compared to 0.4% in 2019. Overall male enrollment slid 6.4%, and 18.1% for freshmen, while total female enrollment fell just 2.2%, 14.6% for first year women. … [Read more...]

Nov
04

Bewildering Ballots

Despite a lack of clarity about who the election winners will be, we can be certain that large fiscal stimulus is a loser. Market hopes of unified government leading to trillions in aid have been largely dashed as divided government is again most likely. Even if one party sweeps both ends of … [Read more...]

Nov
03

Election Elucidation

This is the 59th US presidential election. The first and only one to be held in an odd numbered year saw George Washington defeat John Adams in 1789. Adams, Jefferson, and Madison followed. Those were candidates! The Adams’ were the first couple to live in the White House. President George H.W. Bush … [Read more...]

Nov
02

Market Moves

Since 1860, a Republican has occupied the White House for 95 years, a Democrat 65. The annualized S&P 500 return during the 65 Democratic years of control was 8.4%, 8.3% when the President was a Republican, a statistically insignificant difference. From 1929-2019 one party controlled both ends … [Read more...]

Oct
30

Halloween Hijinks

The Friday File: The percentage of US adults planning to wear a Halloween costume this year is 25%, down from 31% last year. By generation, 46% of Gen Z’ers will dress up, compared to 50% last year. Among Millennials, 43% will get outfitted, down from 50% in 2019. For Gen X’ers, 23% will be … [Read more...]

Oct
29

Great Growth

After declining by a record 9%, or 31.4% if annualized in 20Q2, 20Q3 GDP has come in at a simply stunning 7.4%, or 33.1% if annualized! At this point, the US economy is 3.5% smaller than it was on 12/31/19, and about 4% smaller than it was in mid-March before the onset of Covid-19. While 4% seems … [Read more...]

Oct
28

Income Inequality

Conceptual illustration, the rich and the poor. AI and EPS editable files included. Over long periods of time, I suspect income inequality will systematically worsen. When first entering the labor force, workers generally know little and get paid poorly. However, labor productivity of educated, … [Read more...]

Oct
27

Pleasant Profits

In 12Q1, corporate profits surged and hit $1.88 trillion. Real corporate profits have never been higher since, despite recently lower tax rates. It’s because of the business cycle. Early in the cycle, when unemployment is high, wages stagnate and capital captures increases in worker productivity, … [Read more...]

Oct
26

Peak Production

September new home sales came in at a seasonally-adjusted annual rate of 959,000. While slightly below street expectations, starts are amazingly up 16.9% YTD. But Y-o-Y growth is declining, inventory is up slightly to 3.6 months from August all-time low of 3.4, and sales are 3.5% lower than last … [Read more...]