Personal Finance
Like in World War II, the United States is piling on debt to confront a whole-of-society crisis, raising the question of who will foot the bill in the long term. But, unlike the post-war era, the underlying conditions for robust economic recovery today are less than favorable, placing an even greater onus on wise policymaking.
The United States today not only looks ill, but dead broke. To offset the pandemic-induced “Great Cessation,” the US Federal Reserve and Congress have marshaled staggering sums of stimulus spending out of fear that the economy would otherwise plunge to 1930s soup-kitchen levels. The 2020 federal budget deficit will be around 18% of GDP, and the US debt-to-GDP ratio will soon hurdle over the 100% mark. Such figures have not been seen since Harry Truman sent B-29s to Japan to end World War II. Full Story
- In April of 1997 Apple was near bankruptcy and shares traded as low as $0.49.
- On August 2, 2018 it became the first company to be valued at $1 trillion.
- At $467.55 a share Apple now valued at $2 trillion.
Oil prices rose to a five-month high this week on hopes that the economy is reviving. New coronavirus cases have fallen back in previously hard-hit states such as Florida and Arizona. At the same time, the U.S. shale industry is not rebounding, adding to bullish momentum on the supply side of the equation. Prices fell back in early trading on Tuesday.
Trump admin approves Alaska drilling. The Trump administration approved an oil leasing program for the Alaska National Wildlife Refuge (ANWR), opening up 19 million acres of wilderness for drilling for the first time. The Interior Department is aiming to finalize the process to make it difficult to undo if the election results in a change of administration. However, investors question the profitability of the enterprise, and several major banks, including Goldman Sachs and Wells Fargo, have ruled out financing any ANWR drilling…CLICK for complete article
With the second quarter of the 2020 reporting season mostly behind us, and with markets testing “all-time” highs, do earnings support the bullish thesis? Such is the fundamental question surrounding the debate over the record deviation between “momentum” and “growth.”
No Real Surprise
As we stated before the earnings season began, the annual “beat the estimate” game would, as always, have a high “beat rate.”
“SO EXCITED! – It’s almost Millennial Soccer season on Wall Street where companies begin to beat estimates on drastically lowered expectations.”
Why do I call it “Millennial Soccer” season? As I explained in “The Truth About Wall Street Analysis.”
Earnings season is now a ‘game’ where no one keeps score. The media cheers, and everyone gets a ‘participation trophy’ just for showing up.”
Not surprisingly, after cutting earnings estimates drastically following the first quarter, companies reported a record “beat” rate. Full Story
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