From Forbes:
How New Jersey Will Double Down On Gambling If Casinos Come To New York City
If the handful of billionaires, real estate developers and gambling companies get their way and bring a Las Vegas-style casino resort to New York City, then New Jersey can expect to lose big. With Atlantic City more than two hours from Manhattan, millions in potential tax revenue will end up going to the Empire State and not the Garden State.
“A lot of money is at stake,” says Jeff Gural, the real estate and casino entrepreneur who has a 25% stake in the Meadowlands Racetrack in East Rutherford, New Jersey, just outside of Manhattan. “It doesn’t make any sense to have all this revenue going to New York.”
Gural, who also owns upstate New York casino Tioga Downs and a racino—a horse racetrack with video slots—in Vernon, was a big player in the push to bring a casino to his Meadowlands facility six years ago. Since 1977, New Jersey law only allows casinos in Atlantic City, but in 2016 a ballot measure put to voters that would have ended AC’s monopoly was overwhelmingly rejected by a margin of 77% to 23%.
Gural and his supporters spent $10 million during the effort, while the opposition spent around $30 million. Now, he says, as New York prepares to license up to three casinos in the New York City area there will be enough economic incentive to get a ballot measure in front of voters again.
“I’m waiting and biding my time to see New York get up and running and what the reaction is from the people from northern New Jersey,” he says. “I’d be very surprised if there isn’t a casino in the Meadowlands in a couple of years.”
New Jersey has a lot to lose. Despite Atlantic City’s ongoing troubles, the casinos are still relative goldmines for the state. The resort town generates nearly 20% of its tourism dollars, according to the Casino Association of New Jersey. Every year, casinos pay $500 million in wages to employees, and last year, New Jersey’s casinos, sportsbooks, internet gaming apps and racetracks paid $486 million in taxes, a 44% increase over 2020.
first
You dog…
On yesterday’s topic:
https://investors.verisresidential.com/news-events/press-releases/detail/483/veris-residential-nears-completion-of-strategic
Remember Mack-Cali, that flagship New Jersey office landlord with a portfolio in the suburbs and Jersey City?
Precovid, the company threw in the towel on NJ office to go all-in fancy apartments. Transition almost complete. Brilliant and lucky timing
Yes, we need various gambling dens to supplement the online ability to wager into oblivion. I say we legalize prostitut1on, too. We got pot stores, what are we waiting for? The tax dollars generated would be enormous!
I thought the bizarre late night/ weekend posts were a thing oh the past. I guess not.
Fewer than one quarter of Americans eligible to serve aged 17 to 24 , are eligible to serve in the US military. The remainder would not be qualified due to criminal history, drug addiction, and obesity.
3b on rates, yes, big shift in the FFR curve on last week’s CPI…75bps in December now hanging at 65% assuming Nov at 75bps is a lock….
https://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html
For our Fed watchers who want to dive into the weeds…
I recall discussing here during the Fed balance sheet expansion how it unwinds…looked at it again this weekend, these guys do some interesting summary work…two of their writeups below. High level points…
The Fed is upside down, like a bad S&L…the assets it bought are LT fixed rate, it funds itself ST. Rapidly rising rates kill their p/l. The Fed went into operating deficit on this basis at an approximate 2.7% ST rate…the Fed only had an operating deficit once before in its history, 1915, the year after it was formed….
The Fed gives excess funds (earnings over a small reserve level) to the US government to reduce the federal deficit, $50B to $100B+ annually over recent years. Many parties seem to agree that these new losses will be ‘off balance sheet’, ie. not booked into the US deficit unlike the profit. Neat trick. Take the profits, ignore the losses.
The Fed’s assets – all those trillions of bonds – on a mark to market basis are seriously underwater. Doesn’t matter, unlike other corporates the Fed sets its own accounting rules and creates an offsetting entry so as to not run these ‘change in value’ losses through its p/l. Again, another neat trick. They would, however, recognize actual losses if they sold these underwater securities though…I guess I have my answer why QT was delayed so long into the tightening process (avoid booking more losses). Probably also have the answer why it was scheduled to only begin in September (last month of the US fiscal year, to avoid a major dustup of whether they are on- or off-budget). And lastly probably also have the answer why QT has consisted mostly of letting current bonds mature rather than actually selling them (when bonds mature there are no mark-to-market losses).
What a clusterfuck. If the Fed were a commercial entity they, or the Treasury, OCC, or Congress, would have shut them down immediately as insolvent and a systemic threat. So, back to my ‘upside down national S&L on steroids’ analogy…who bails out the Fed?
https://www.aier.org/article/federal-reserve-operating-losses-and-the-federal-budget-deficit/
https://www.aier.org/article/will-federal-reserve-losses-impact-fed-shareholders-or-affect-monetary-policy/
Yeah, kind of sad…for years Fri/Sat and many Sunday nights were alone knocking around on here…for someone with a wife, kid, and presumably some person(s) who can tolerate him for a short time socially I don’t know what to say…I’d feel empathy if he weren’t such an irritating little twat.
Anyway, after recent purchases across four accounts of two very different types on two different systems I’m off to figure out what the hell I actually own…lol, not that bad but I do need to update spreadsheets to get a handle on aggregate exposures for various market moves…Let’s have a boring market day…Have fun, All…
Remember when the Fed supposedly “made money” on all their actions.
Left: If there is no mtm loss booked on maturity, then it implies an amortization of the premium. One or the other. There has to be a plug.
Convenient little black hole
Liberal fucks like Krugman piss me off with the empirically discredited Mod Mon Theory
Where the fuck are those jakasses now?
Left – Fed never needs a bailout. It’s a bail-in for everyone, like it or not.
As we all know since 2008 the Fed will the hold debt until the cows come home. Now that they are rolling off only mostly maturing debt and some t-bills at a rate off $95 billion per month, well that means they expect the PRIVATE SECTOR to absorb the need for NEW DEBT issuance an extra $1 trillion of treasuries and mortgage-backed securities a year. Only way that is going to happen is with higher rates, but how high? QT has the same effect as raising rates, so in addition to the QT how much will the Fed need to raise rates and properly contain inflation? Do they really need to go beyond where we are with an FFR target range of 3.00 – 3.25?
Estimates vary on what QT and raising rates combined equal. There is a range of opinions, most say we are now at as tight as we can go between raising rates and QT, the recession will come and end dates vary between end of next year and so on when unemployment hits 5-6%. I would expect them to continue to raise rates to go to as high as 4.5% FFR.
Even with all that by 2024 the Fed will only perhaps roll off at best 1/3 of it’s balance sheet and call it mission accomplished. Powell will retire and leave it to the next generation to deal with the debt overhang that began 14 years ago with Bernake, and with no real end in sight.
When are you folks going to learn? Don’t say Beetlejuice and you won’t conjure him up….
Juice: Good analysis, although I believe the FFR needs to get to 5 or 6 percent.
“Remember when the Fed supposedly “made money” on all their actions.”
Never believed that shit. Never trust the government.
3b – 6% is too political….recession becomes too big…assets price deflation (mostly housing) too big to stomach etc.
3b,
I’m kind of in the middle. I expect earning to start to suck this and next quarter which will be a drag on the markets. I also think once the recession is officially here (it probably is now) the negative news reporting cycle will aid the slow down. Finally, I think you won’t see the CPI start dropping significantly for another 3 months. Interest rates are probably high enough now to slow the economic growth where they currently are. Though, it will take a few more months before people squeaking by start to default. Especially with the high natty gas prices and housing prices dropping.
I expect the FED to raise two or three more times just to be sure, and this will overshoot making the recession worse than it needs to be to which they will walk back the last three increases probably in one fell swoop. Won’t matter. By then the damage will be done. That’s when there will be blood in the streets. Figure late Winter, Spring. Recession will be over by end of Summer/Fall.
Our HVAC guy is on the way over. One of our ac units condensation line is clogged. I had even poured a bottle of condensation line cleaner down it 2 weeks ago and the thing clogged over the weekend. Had to break out the wet vac and drain the overflow pan for the unit to turn back on.
Juice. We are thinking alike. You, more succinctly.
beer – re: wet vac and drain the overflow pan for the unit to turn back on.
Attic unit? You don’t have a drain line from the pan itself? Install one if it is the attic becuase if that switch fails you will have a ruined ceiling…
Ask me how I know!!! :)
Chi,
oped I wrote in 2009 that got published.
In 2009, the deficit projection is now $9 trillion. That’s a $14 trillion swing from the $5.6 trillion surplus eight years ago. We should do ourselves a favor and stop acting like any of their projections are realistic. If Vegas were taking bets, the point spread would be another $7 trillion. As far as the CBO goes, Mr. Krugman says himself,
Last week the Congressional Budget Office marked down its estimates yet again. Just two years ago, you may remember, the C.B.O. was projecting a 10-year surplus of $5.6 trillion. Now it projects a 10-year deficit of $1.8 trillion. The Congressional Budget Office operates under ground rules that force it to wear rose-colored lenses.
We are royally screwed when a $9 trillion budget deficit is the rose-colored version. Maybe we should be preparing for a $16 trillion deficit.
So, I tossed an insane number out in jest about our 10 year deficit. I was way short. MMT was always doomed from the start. What’s worse is the economic chaos that it creates along the way. JFC. I’ve been fortunate enough to navigate the waters with high efficiency. I timed my purchase price on a home, timed my refi, timed my exit from the stock market. The Average American is completely oblivious to all of these things, and is getting trashed. When we couple that with insane suicidal energy policy and shutting down economies, this is easily the most insane chain of events in the past 40 years, and it’s not over yet.
You know it’s over when Tom Brady loses his wife and loses to Mitch Trubisky in the same year.
Juice
Both are attic units. The clogged one Has drain line that connects to a sink in the upstairs bathroom. The pan has a float in it that triggers the unit to shut off when it floats to a certain height. (Didn’t work the first time this happened, but caught it early enough just needed towels to clean it up and repaint a doorframe). The other one drains to the outside of the house. That one is by the exterior wall. The clogged one is towards the middle of the attic directly above a bathroom.
Our hot water heaters are in the garage. I couldn’t believe how many houses built in this area had hot water heaters in the attic or an upstairs closet. What a mess that must make when they break, since they tend to burst the drip pan is useless most of the time. They will be 10 years old in the spring. Debating if we should replace them with tankless or tank ones next spring or summer.
Republicans Gain Edge as Voters Worry About Economy, Times/Siena Poll Finds
“I’m shifting more towards Republican because I feel like they’re more geared towards business,” said Robin Ackerman, a 37-year-old Democrat and mortgage loan officer who lives in New Castle, Delaware, and is planning to vote Republican this fall.
Ackerman said she disagreed “1,000%” with the Supreme Court’s decision to overturn Roe v. Wade and erase the national right to an abortion. “But that doesn’t really have a lot to do with my decision,” she said of her fall vote. “I’m more worried about other things.”
https://www.yahoo.com/news/republicans-gain-edge-voters-worry-114543299.html
Phoenix
Maybe he unretired Knowing that would cause her to dump him. He can play the victim.
Lib: I could see your analysis play out, though skeptical that the recession will be over as quickly in your analysis, we shall see.
Or maybe she talked him into retiring and a vasectomy- but he could only reverse one of the two.
I read a story about a guy who’s wife did this knowing this would protect her future child support money- dumped him the day after she talked him into a vasectomy telling him he would get it every night.
Juice: Perhaps too political as you note, but the only way to ensure the medicine stays down. As for deflation, I believe that’s part of what the Fed wants to accomplish. They have already deflated the stock market, real estate market is next.
If your drain line is really clogging you can attach a shop vac to the lower end of the line. Run it for a minute or two then check the shop vac to see what is in it. If it is really clogged there will be no water in the shop vac, otherwise the shop vac will fill with water and clear the clog. A plumber will cut or the line further up and clean it with a pipe cleaner or a long snake etc and then splice it back together.
If your drain line is really clogging you can attach a shop vac to the lower end of the line. Run it for a minute or two then check the shop vac to see what is in it.
Sounds like a JJ story.
What happens when you try to juice the economy too fast for too long. You lose lift.
https://youtu.be/5fpxm0D46iQ?t=11
3b -re: “medicine stays down”.
Patient has been on life support since the September 15, 2008 the “Lehman Moment” and well 14 years is a long time. Even with this massive QT they still won’t shrink the balance sheet for a decade. Reality is there is no way they can run QT and keep rates high that long. There will be various starts and stops of the printing presses but they will not be silent for too long as for you see the next crisis is only around the bend.
Only part of the population, the working stiffs, feel the side effect of the “medicine.”
Others benefit from it.
only way to ensure the medicine stays down.
HMB,
D-Link sells wifi water sensors which work great. The plug is the wifi broadcaster and the wire is a telephone wire, so you can easily extend it. I have one below my furnace and water heater. Water heaters start dripping before the leak becomes a water fall. In the case of your pans, just mount the sensor halfway up the wall of the pan. You will get a notification and an email the moment it senses water. Take 5 minutes to set up. I paid $60 for them about 10 years ago. I think they are $100 today. Maybe find some used on Ebay. They are bullet proof.
$17 on ebay.
https://www.ebay.com/itm/175216666487?mkcid=16&mkevt=1&mkrid=711-127632-2357-0&ssspo=EWC016t1Qoq&sssrc=2047675&ssuid=3MqncCUASaq&widget_ver=artemis&media=COPY
My theory is Brady went in big on crypto and has massive losses that is why he unretired.
Juice: You May be right, and maybe it can’t be fixed only managed, until it can’t be.
3B -Kicking the habit is never easy. Remember the Taper Tantrum?
How about a QT Stroke?
From Bloomberg Opinion today..
“Markets have been whipsawed in recent weeks, first by talk that a cooling labor market would allow the Federal Reserve to “pivot” away from its aggressive interest-rate hiking campaign, and then by comments from central bankers that any such move would be premature — as Thursday’s hot consumer price index report proved. Perhaps there’s a solution that would allow the Fed to continue to battle inflation while also addressing what is rapidly becoming a potential crisis in the world’s most important market — US Treasuries.
The word “crisis” is not hyperbole. Liquidity is quickly evaporating. Volatility is soaring. Once unthinkable, even demand at the government’s debt auctions is becoming a concern. Conditions are so worrisome that Treasury Secretary Janet Yellen took the unusual step Wednesday of expressing concern about a potential breakdown in trading, saying after a speech in Washington that her department is “worried about a loss of adequate liquidity” in the $23.7 trillion market for US government securities. Make no mistake, if the Treasury market seizes up, the global economy and financial system will have much bigger problems than elevated inflation.
But rather than slow, or even stop, the pace of rate increases, which would only resurrect the notion that there’s indeed a Fed “put” designed to bail out investors, the central bank could choose to slow quantitative tightening. Whereas quantitative easing, or QE, injects liquidity into the financial system through bond purchases, QT has the opposite effect. Instead of selling bonds, the Fed is allowing the $9 trillion or so of US Treasuries and mortgage securities it has accumulated on its balance sheet since the 2008 financial crisis to mature without replacing them. The amount of QT conducted by the Fed ramped up to the maximum of $95 billion per month in September from $47.4 billion.
The thing is, just like there’s no strong evidence that many years of QE had the desired effect of sparking inflation, it’s unlikely that QT will help temper inflation. What it is more likely to do – and is probably already doing – is cause havoc in the government bond market, the benchmark for all other markets that determine the cost of money for governments, companies and consumers.
A Bloomberg index shows liquidity in the Treasury market is worse now than during the early days of the pandemic and the lockdowns, when no one knew what to expect. Similarly, implied volatility as measured by the ICE BofA MOVE Index is near its highest since 2009. And in an unusual development that shows just how dysfunctional the Treasury market has become, the newest, most liquid securities, known as on-the-run notes, trade at a discount to older, tougher-to-trade off-the-run securities, according to data compiled by Bloomberg. Daily swings in interest-rate swaps have become extreme, proving further evidence of disappearing liquidity.
What should be most concerning to the Fed and the Treasury Department is deteriorating demand at US debt auctions. A key measure called the bid-to-cover ratio at the government’s offering Wednesday of $32 billion in benchmark 10-year notes was more than one standard deviation below the average for the last year, according to Bloomberg News. Demand from indirect bidders, generally seen as a proxy for foreign demand, was the lowest since March 2021, data compiled by Bloomberg show. Although the Treasury is in no jeopardy of suffering a “failed auction,” lower demand means the government is paying more to borrow.
All this is coming as Bloomberg News reports that the biggest, most powerful buyers of Treasuries – from Japanese pensions and life insurers to foreign governments and US commercial banks – are all pulling back at the same time. “We need to find a new marginal buyer of Treasuries as central banks and banks overall are exiting stage left,” Glen Capelo, who spent more than three decades on Wall Street bond-trading desks and is now a managing director at Mischler Financial, told Bloomberg News.
The US bond market, which sets the tone for debt markets worldwide, is hardly alone. The ructions in UK gilts the last two weeks laid bare the liquidity crisis bubbling in most major sovereign debt markets. From the Fed’s perspective, it’s probably hesitant to tinker with QT for fear of being seen as more concerned with bailing out Wall Street fat cats than taming inflation. But, again, QE and QT have been shown to have more of an impact on the smooth functioning of the financial system than the real economy. And it’s not like the Fed hasn’t tweaked its QT program before to address disruptions in the market’s plumbing. Recall that in 2019 the central bank halted QT and flooded the banking system with cash to arrest a large and unsettling rise in repo rates that led to undue stresses. Another option is for the Fed to use its standing repurchase facility to provide a liquidity backstop to the Treasury market, which Yellen said, “can be helpful.”
The thinking among market participants is that the Fed will keep raising rates until something “breaks.” That something increasingly looks like it may be the Treasury market, which would be the worst-case scenario on anyone’s scorecard. Time is running out for the Fed to act. “
I always thought it would be a new Civil War that would kill our treasuries. Didn’t think it would be QT.
Take 5 minutes to set up. I paid $60 for them about 10 years ago. I think they are $100 today. Maybe find some used on Ebay. They are bullet proof.
I got a couple dollar discount from NJM for homeowners for having them.
Juice: Yeah, I remember the taper tantrum, and the Fed should have shut it down back then. As for the last sentence in the article you noted , time is running out for the Fed to act, what do they want the Fed to do?
Boston University CREATES new COVID strain that has an 80% kill rate – echoing dangerous experiments feared to have started the pandemic.
More than one way to skin a cat.
3b – Powell did what he said he would do and now the chickens are coming home to roost…..
As I mentioned it could get political very quickly, as we are running 217 billion dollar deficits monthly now. The Fed has wanted the US Government to cut deficit spending for years. It’s really that simple, but Washington is addicted to massive debt spending now due to low rates.
Powell was saying so pre-pandemic and has has come back and said it again at his Jackson Hole speech in August. His words have been the federal budget deficit is still on an “‘unsustainable path” and by the Fed raising rates alone it won’t tame inflation. He is going to QT for at least another year, but as soon as the next crisis arrives all bets are off.
All done $120 to clear out the condensation line. Now the sink the line is connected too is clogged. Need to pour some green gobbler down it. Poured 1 bottle but it’s a double sink. Tons of junk have come up but I think it will be a 2 bottle job.
I’ve tried the shop vac and firing air cartridges into it last time and it didn’t work. The air cartridge gun we have isn’t powerful enough. It gets backed up because it connects to the sink. I need to put green gobble down that sink every 3 months to keep this from happening in the future.
Also found out we are not good candidates for a heat pump since we have a gas furnace.
Phonnix – A little gene splicing what could go wrong? All they did was add the newer Omicron’s spike protein to the original Wuhan Covid strain….
I am glad I got my bivalent booster, when is the next one coming out?
Lib: Maybe we will get both.
Beer- re” air cartridge gun we have isn’t powerful enough”
Water pressure from a hose works, it’s around 50 PSI, need to use with a small rubber bladder. Make sure you have someone man the valve, don’t run it too long…and have plenty of rags.
Get one at the hardware store.
https://tinyurl.com/4m4d3cx4
HMB,
Try not to use liquid plumber products. In the long run, they cause more problems than they create. Go buy a snake from home depot. You don’t need a plumber quality one. About $50. Pop off the P trap and snake away. It is really, really easy. Put a bucket under the P trap when snaking. Takes 5 minutes.
https://www.homedepot.com/p/RIDGID-Power-Spin-1-4-in-x-25-ft-Hybrid-Drain-Cleaning-Snake-Auger-Manual-or-Cordless-Drill-Operated-Tool-Only-57043/303644607?
Problem with the air or water devices is that they won’t work depending on where your vents are. More often than not, there is going to be an upstream vent or fixture, which make those devices useless.
Thanks for reminding me on the condensate drain, going to pour some dilute bleach down the vent. Had the condensate pipe clog and freeze two winters ago, come summer and AC, damaged the living room ceiling. Good thing it was close enough to a recessed light fixture to drain before it screwed up the whole damn thing.
I probably snake once every 6 months at this point. Definitely worth it.
I probably snake once every 6 months at this point. Definitely worth it.
Another JJ story? ;)
chi, agree on the MTM and expiry…this ‘accounting’ makes my head hurt…maybe that is the ‘deferred asset’…IDK.
Back when all this was getting put on again around covid and people were asking how do we unwind it I tried to figure out what would happen if the Fed just forgave every T-Note and Bond…literally, send it back to the US Treasury marked ‘repaid’ and take nothing for it…what would happen?
Wild inflation? Rapid devaluation of the dollar? Evaporation of credit for the US government?
Don’t think so…you’re not tampering with the amount of Federal Reserve Notes (currency) in circulation…you’re not reneging on payment to any third party holder of Treasurys…
All you’re doing is a book entry between two separate but affiliated entities for contracts that exist between them…there is the matter that Fed Reserve Notes (our money) must be fully collateralized but that is a lie anyway…pulled up the Fed’s financial statements for June 30 and there is $58B of capital with $8.9T of assets on top…a glance in those financial statements has the Fed showing $720B of impairment on the QE assets…
$720B of impairment against $58B of capital is deep insolvency…they can fuck with accounting all they want but they’re just looking in the mirror lying to themselves…
So why not do a good bank/bad bank with the Fed…move all the operations and the small amount of non-impaired assets over to NewCo…let the US Treasury recap Fed v2.0….at $58B of fresh capital that’s not even a rounding error, we sent how many times that to Ukraine over the last couple of months?
This seems so straightforward and super politically expedient…I must be missing something…
https://www.cnbc.com/2022/10/17/hearing-aids-are-now-available-over-the-counter-from-walgreens-cvs-and-best-buy.html
I guarantee you the next version of earbuds from Apple will be marketed with a hearing aid function. Apple’s tech will absolutely blow away anything else on the market at the price point. They already have adaptive noise cancellation and pass through. Just wait until they include AI-based voice recognition, which can pass through human voice, and eliminate any other sounds from coming through, or overpowering voice (which is beyond the ability of any current hearing aid). They’ve got the ability to do all the fancy frequency range boosting that the high end audiologists do, hell, they could probably build the hearing test right into the product.
Plenty of us Gen X’ers spent way too much time at concerts and in clubs, and are going to be customers in a few years.
Off topic:
My wife and I are finding it difficult to get fellow parents to make time outside of school for our kids to socialize.
We have parent connections, a play date here or there, we even met some parents in Europe this summer (overlapping schedules). When we run into each other it seems to be all good. You know the usual, oh we have to do this and this… yadda yadda.
Group texts about going to the park to catch the last of the warm days either go unanswered, or we have to hear from the stay at home mom of one that it was “too last minute” and she could not schedule. What? It’s a park, in town…it’s 71F outside in late October, what do you have to schedule? Play dates are being scheduled for a month out? (wtf?) We’ve gotten “don’t give up on us” in response to the n’th text message to someone we know.
We’ve made parent friends who have owned in town for close to ten years but don’t know we have multiple pools in town. Earlier this summer my wife suggested to this parent that the kids hang out at the pool which was met with a blank stare. You’re a parent, how do you not know this?
Is this a culture thing? Is it us? What do these people do after work that they are so busy? Are these kids just watching TV all afternoon and evening? It just seems like the ONLY thing parents seem to make time for is organized sports.
I was under the impression that this would warm up as kids get into school age, but this doesn’t seem to be the case. People just seem to drive to work , pickup from school come out for sports, but want to be left alone otherwise. Scheduling play dates for three weeks out? Get out of here.
I know a lot of you have older kids, but I can’t be the first to have this experience.
Lib, generally agree with you on pathway of the economy…would toss out the following though…
When ‘earnings’ are referenced I would be more specific…there are light years of difference between managements of SPX and NDX companies…I suspect the SPX companies have banked enough reserves and have enough levers, as well as the skill set to manage expectations such that they can make it through 4Q whole (ie, not down) but that is on a knife edge right now…we’ll have an idea in ten or so days most likely.
Either way, 2022 SPX earnings should be above 200 and absent a real fail in 4Q at least flat on 2021…to me, that sets 2023 up for the full brunt of the recession, and if we were to take a simple 20% down you can be looking at 180 or less…that’s bad, lol, and certainly not priced in.
That’s a good part of the reason I mentioned a while back that I had started pushing everything of mine down and out…where my yardstick months ago was ‘do I believe the index will be higher in June 2023 than now’ and I could fairly confidently answer ‘yes’ and traded that way, I’m not owning that date any longer…earliest I’m at is Dec 2023 and I’ve started legging into some positions now into 2024…
On CPI/inflation, the math (not opinion, but calculation of the CPI) said as long as month-over-month stayed at 0.3% up or less then year-over-year CPI would be less than FFR by June 2023…that is, for the first time in a while we would have positive real rates, which is the first big milestone for the Fed….again, looking like that’s gonzo so another reason to push out to end of 2023….
Don’t think we’ll have the NBER date the recession to present, employment is still too strong…but if the C+I of the C+I+G of GDP disappears in 4Q (bad retail holiday season, etc) we can be full on in a downturn in 1H2023 at which point or shortly thereafter the market starts reversing and turning up…hence, again, the EOY 2023/early 2024 horizon now, for safety…
Mike Wilson, of MS, who was always good but has been spot on with direction changes and levels has a nice piece out this morning getting some chatter. I’ll shoot it over to you.
Boomer, it’s been impossible. Nobody wants to put in the 5 minute effort. My son/daughter have 2 friends each that are reliable. But the process to getting to that point was like pulling teeth.
“It just seems like the ONLY thing parents seem to make time for is organized sports.”
Think this comment of yours might be the answer…not sure what age your guys are but once mine got ‘serious’ about organized sports (shamefully meaning around 10 years old) there really wasn’t that much free time and what did exist outside of school, homework, family, etc my guys just wanted to chill, not another scheduled activity…
Doesn’t mean they didn’t ‘socialize’ but getting them to commit to something other than on the spot was like pulling teeth…
Boomer,
Not alone at all. My 8 year old son plays soccer, basketball and have him in piano. It is a struggle to get him to take any seriously (ie he likes running and has a good ear but won’t play with discipline). He loves trains, and maybe some bey blades and legos. Fitting in is absolute struggle with many because parents now analyze if kids ‘play well’ and have ‘common interests’. If not, goodbye…or fade away quickly. We did not grow up this way. Our parents threw us into a room or a field and let us figure out friendships. I don’t know age but find what your kid likes and try to find groups that meet for that activity. Much more likely to have parent friendships that way.
Boomer,
Also, I tell my wife this ‘you never really leave high school’. First, two years (K and first, we thought big pool parties with nice food etc was sure a great way to get kids and parents to meet. We invited people from all over town. Kids that son met at library, sports, school. It worked but then we realized that many just liked our pool in summer and never heard from them in winter. Dump them quickly. Heavy sports parents/kids will play with other sports parents/kids. My son does not play hockey or baseball so completely excluded from that click at 7 years old. It is heavy around here. Concentrate on your neighborhood and kids class. We also met nice people at local branch library. Keeping it quick and convenient for everyone is paramount. Over time, you may click with some but it takes time. Also, I don’t doubt the schedule thing. Everyone I know has kids in some private class on Sat whether swimming, ninja academy, gymnastics. Lots have several activities. Everything is planned today.
Boomer,
Interesting dynamic. I feel ancient. As a kid, when summer hit, we were on a bike; exploring, creating, destroying, doing whatever in packs from sun up to sun down. During the school year, we did the same after school again until dark. Organized sports were there but not as avid as today’s generation. The difference between then and now? No laptops, no phones and six TV channels. Seven if you count PBS.
My kid was a dancer, so nearly all her playtime from K-12 was spent at dance practice. Occasionally spent some time with schoolfriends that were nearby on weekends. When dual working parents abound either the kids need to hang out with other neighborhood kids, or forget about it.
When I was a kid, kids rode their bikes sometimes several miles after school to go to friends’ houses to play. Only one kid in my elementary was killed when their bike was run over (1970s, early 80s). But parents nowadays don’t want to take that chance anymore.
Eddie,
I only had 3 channels, the fourth, PBS was fuzzy and needed an extra coat hanger to even see it.
That’s one reason I read so many books when I was young.
About the kids thing. I can’t even get my friends to hang anymore and many of them have offspring in college. So what gives. I might cancel that fishing trip. I can’t find a single taker.
Yet on our block, there are kids of all ages who still hang out. Ride bikes, play hide and seek, just chill on someone’s porch. Besides club sports, I think it’s helicopter parenting. Even at the elementary school bus stops. Every kid is there with a parent. Every single one, at every single one. Growing up, we waited by ourselves even as young as kindergarten. What gives?
Heck, people don’t even want to debate or converse anymore,
And no trouble makers in the group, right Ed? Today, my snow-plow wife analyzes the behavior of a 7 year old on playground to see if he plays nice. If not, she will gear kids away from playing with him. They all do. It is beyond nuts but good luck. I had beers with neighbor other day and I had him cracking up about water bottles today. My wife gets stressed to max if water bottle missing or not filled to brim. Hose, water fountain..wrong answer
Boomer – ” Are these kids just watching TV all afternoon and evening?”
Yes and No… For many kids it’s mostly touching glass….They all go running home from the bus and don’t really want to spend time with other kids, few venture out on their own on bicycles, perhaps it is a bit of Covid lockdown conditioning as well as their touching glass and video games addictions.
Over the last 10 years we have met families in the neighborhood, via the bus stop or our annual neighborhood party but we no longer associate with some because either the wife acts like she is a member of the cast of real housewives or the dad is a psycho with guns, and their kids do zero sports or zero anything really, no camp, no activities etc as I said touching glass or video games is all they do, and they look round balls of fat for it too.
Currently my older son is now at his friend’s school soccer game with 3-4 other friends who he knows from travel soccer or school, and he has his own practice tonight from 6:30-8:30 PM that’s three times a week. My younger son I keep in aftercare so he can play for a few hours with other kids on the school playground for a few hours for four days a week and soccer practice Friday and we have games on Saturday and Sunday. Our after school time is pretty booked solid with soccer. Only day there is nothing is really Thursday.
My older son also made allot of friends at camp, and will ride his bike to meet them even as far as four miles away. They also went on an organized trip to Fright Fest at Six flags last weekend about 12 of them.
No worries about them so far, no trouble has started yet. By 7th grade the kids I knew were all beginning to get into trouble, hopefully it stays that way….
Boomer
It’s really how things are now. I never see kids playing outside. Everything is organized sports or church based on my area. Have no clue what people are doing to be so fractured.
I watched a documentary on Johnny cash live at San Quentin. I was shocked at how articulate the inmates and guards were, even the ones who said they were poor were better spoken than most politicians you see on tv. I think the internet, podcasts, and streaming on demand is probably a big part of the isolation and poor language skills today.
Literacy.
Parenting by screen.
Lost Art of conversation.
Lib: I have my friends from the Bronx that are all for the most part in Westchester and Rockland Co s, with a few in Bergen; we get together on a regular basis. More so now since kids are all raised. My friends in town are always complaining there is nothing to do, and will get only go out somewhere if it’s like in a 2 to 3 mile basis. Anything that involves longer travel or any other kind of effort they become overwhelmed, and won’t do it. I just don’t understand it. Must be a suburban thing.
No One,
I only had 3 channels…
The Manhattan skyline was my view so the TV reception was more than adequate. :)
You’re saying that central banks are powerless?
They’re impotent. This is a shift of power that cannot be underestimated. Our whole economic system of the past 40 years was built on the assumption that the growth of credit and therefore broad money in the economy was controlled through the level of interest rates – and that central banks controlled interest rates. But now, when governments take control of private credit creation through the banking system by guaranteeing loans, central banks are pushed out of their role. There’s another way of looking at today’s loud, hawkish rhetoric by central banks: Teddy Roosevelt once said that, in terms of foreign policy, one should speak softly and carry a big stick. What does it tell you when central banks speak loudly? Perhaps that they’re not carrying a big stick anymore.
https://themarket.ch/interview/russell-napier-the-world-will-experience-a-capex-boom-ld.7606
Lol —-White House sources say Joe Biden is furious The Eagles booed his wife and plans to call Don Henley personally.
Just what America needs, goes great with all the booze and CBD use.
https://www.nj.com/business/2022/10/sugar-factory-sets-opening-date-for-new-nj-location.html
Crazy up futures. I am praying for one more up day and I’m going back to more 70 stable/30 long, in the stuff I can move without penalty.
This may be the real face ripper.
Be careful…movement is all because of a small sampling of earnings, we are really just in Day 2 of a couple weeks’ worth…Financials came in well, as did a couple names including JNJ…rubber really starts to meet the road next week…at least let’s get through this Thurs…
Look at 11/2-3, there’s 500 companies reporting, really important ones, which straddle the Fed meeting that day…and for shits and giggles we have an election the following week…
It’s nice to have up days, but not necessarily healthy the magnitude of intraday moves…sign of an indeterminate, nervous market.
https://www.barchart.com/stocks/earnings-dividends?orderBy=timeCode&orderDir=desc
I actually found the bank earning mediocre at best.
Do you know of a place where once can find out how much estimates were lowered for companies between quarters without looking it up individually?
The Saudis jack up the price of petroleum so that I pay more at the pump and then turn around to use the profits to buy American military expertise-and help create the next Bin Laden. Now I get it. I guess I should be more patriotic now.
More than 500 retired U.S. military personnel — including scores of generals and admirals — have taken lucrative jobs since 2015 working for foreign governments, mostly in countries known for human rights abuses and political repression, according to a Washington Post investigation.
In Saudi Arabia, for example, 15 retired U.S. generals and admirals have worked as paid consultants for the Defense Ministry since 2016. The ministry is led by Crown Prince Mohammed bin Salman
Found this.
https://www.pionline.com/interactive/analysts-lower-sp-500-quarterly-earnings-estimates
Would like to get more granular.
Here we go.
https://www.yardeni.com/pub/peacocksp500revisions.pdf
Can’t believe real estate is still that high.
“I actually found the bank earning mediocre at best.”
The market disagrees with you.
On earnings, yes, it does exist. I recall looking going into earnings how many companies had already guided down of the SPX, it was just under half IIRC. For life of me I have no idea right now where that was…LMK if I can find it. Something I want to refresh as well…
Billionaire investor Mark Mobius says rates will get to 9 percent. Investors expecting 5 percent FFR by early 2023.
Yup. Yardeni.
LMK if you find an interactive data site. Distinctly remember recently seeing something like 234 of 500 companies, with the ability to click through to underlying data and sort. Factset maybe. Or MacroTrends. I’ll look. But LMK if you find.
I bookmark these things, but have so damn many bookmarks now they need to be organized lol.
I’ve got 1200 bookmarks now.
LOL. I’m at a tenth of that and can’t navigate even that many…
This is not a good look… an old man doddering around with an ice cream cone, looking like a lost five year old. He’s got to pause and think about image. Or, is he so spaced out now that it doesn’t matter?
https://www.youtube.com/watch?v=llwEUH4Lnb4
Eddie, one of my best friends/colleagues is the same age as Biden, and is 1 year into Alzheimers diagnosis. This is a guy who was razor sharp his whole life, teaching until age 76, doing high level Physics calculations. It’s been heartbreaking because he’s fading quickly….He no longer answers text messages but I can call the phone and his wife will pick up for him and put him on.
as I said, once this starts, it’s never a slow decline. It’s usually one that accelerates.
Biden’s answer was actually pretty cogent. Not brilliant, but at least he didn’t misstate anything.
But yes, he appears old and feeble.
Obammy coming out now and demanding the democrats stop talking about Trump, January 6th and abort1on 24/7. That’s all the discussion has been for the duration of this current administration’s disastrous regime. The democrats have become an arrogant, elitist bunch of white wine charlatans. The republicans are now the party of the hard-working contributors.
Obama said the Democrats can be a buzz kill too!
BRT my wife’s step mom just passed away from Alzheimer’s she went from college professor to vegetable in something like 7 years while she was still in her 60’s, it spares no one regardless of how intelligent they are.
Biden’s answer makes zero sense, the policy failure is indeed global it is the WEF, Open Society, Eco-warrior policies being forced into effect at the same time as a pandemic on top of years of central bank fantasy. The reality is the pandemic constrained supply and energy shortage is a key driver of inflation, when you look at the bag of flour, piece of meat, can of food just consider a huge portion of the cost is diesel and fertilizer and other petro-chemicals. Literally everything you buy is produced using energy and transported using tons of diesel. The other issue was that the pandemic should have put people in a defensive position as “real”(tangible goods production) productivity was significantly reduced and seemingly people accelerated spending based on a mirage…. money from the government.
The war on petroleum is a problem and the biggest exacerbation of the problem is the Russia-Ukraine war, the idea that western Europe can sustain prolonged energy insecurity is untenable, Europe will collapse economically and politically which IMHO is far more significant than Ukraine’s borders. The war needs to end and I think Putin realizes he doesn’t need to have the superior military because politically the west will turn against the war and once NATO support stops Ukraine is finished.
I stand corrected. Biden’s answer was politically sound.
I’m afraid the mobility that a lot of people enjoyed, selling homes/buying homes///might be in for a real wake up call. Oy.
LOL. I’m at a tenth of that and can’t navigate even that many…
Uh oh.. that’s how it starts. 😂😂😂
Ha…put me in a chair in front of flashing lights and just let me drool on myself….feels like I do that already some days lol.
I just paid $600 for my son’s AP exams.
How am I going to be able handle paying for his college?
I told him, 4 or better or he is paying for them. He said was going to run that by Gator. Heck, anyone can sign up for an AP class. What matters is what you get on the exam.
Inflation anecdote:
I’ve had really, shockingly high prices from the following service providers (which I’ve used for years): architect, plumber, hardwood flooring installation and finishing, and tile installation. I’ve paid now in the last 1-2 months from 33% higher to 2X compared to a few months ago. On the bright side, hardwood flooring material is only up 20% from long-term prices I’ve paid for years before recent inflation.
I suppose my point is that inflation has been slapping me in the face at the grocery store, but I haven’t felt it when contracting for construction-related work. Construction materials were slapping for a while, but some of that has come down.
I say raise it 75 bps, and then 75 bps. After that, I suppose they can go to 25 bps per meeting for a long while.
NJ Transit giving 40% off two round trip tickets to NYC. Smells like desperation.
Cracks me up thinking about it. The irony. The best financial advice given on this blog was by the so called village idiot. Used to say over and over, take advantage of the free money and buy as much cheap real estate as the bank will allow you. Instead got laughed at. Now with high rates and high prices, who is the village idiot?!
You could have made so much money off that advice, being that most of you are older and could have been approved for huge loans, but instead you laughed and mocked me. Calling me an idiot that knows nothing. Can’t wait in 10 years to tell you that you should have listened and bought DNA and ETH while they were dirt cheap…
Some of you missed out on millions…I maxed out what I could afford in 2012. My wife held me back by not letting me buy more real estate. Sometimes being married holds you back.
It’s funny, you guys think my wife is the reason for my wealth…nah, she has cost me millions in lost investment opportunities that I knocked out of the park. Would have been a millionaire at 29, but she wouldn’t let me buy sirius at the bottom (.10). Instead have it in the bank losing value.
He must have missed Lib’s post on selling his home.
Lib could have been selling 2 or 3 homes…just saying.
Lib does his thing with investing, not putting him down, just pointing out he could have went this route.
Hope she still puts out pumps.
Anyone digging Bruce’s new soul music album?
I still feel as if we haven’t received real news yet. However, the further we go without a proper miss means a narrative is being written….. it just feels as if we are in a lose/lose situation. Screw the results; I just want the forecasts. Testing the wind tells me that strong news means that the interest rate hikes really haven’t changed behavior of actors in the economy (real world, not the markets). The problem is that continued solid demand creates the justification for the Fed to keep pouring it on…… as I said lose/lose
leftwing says:
October 18, 2022 at 9:16 am
Be careful…movement is all because of a small sampling of earnings, we are really just in Day 2 of a couple weeks’ worth…Financials came in well, as did a couple names including JNJ…rubber really starts to meet the road next week…at least let’s get through this Thurs…
Look at 11/2-3, there’s 500 companies reporting, really important ones, which straddle the Fed meeting that day…and for shits and giggles we have an election the following week…
It’s nice to have up days, but not necessarily healthy the magnitude of intraday moves…sign of an indeterminate, nervous market.
re: ” interest rate hikes really haven’t changed behavior of actors in the economy ”
Look to Powell’s speech about cutting deficit spending. He already said rate hikes will not stem inflation unless Washington cuts spending.
BREAKING:
“SPR inventories have fallen to their lowest since 1984 from the administration’s aggressive moves to bring pump prices of gasoline down before the election.”
Who said you cannot buy an election on the cheap?
15 Billion more barrels from the reserve, and more to come.
https://www.latimes.com/politics/story/2022-10-18/biden-to-release-15-million-barrels-from-oil-reserve-with-more-possible
Nailed it.
Read that article I shared yesterday about central banks not being in control due to covid govt bank guarantees. Changed the game. Really good article, not sure I agree with it all, but really good article.
chicagofinance says:
October 18, 2022 at 8:17 pm
I still feel as if we haven’t received real news yet. However, the further we go without a proper miss means a narrative is being written….. it just feels as if we are in a lose/lose situation. Screw the results; I just want the forecasts. Testing the wind tells me that strong news means that the interest rate hikes really haven’t changed behavior of actors in the economy (real world, not the markets). The problem is that continued solid demand creates the justification for the Fed to keep pouring it on…… as I said lose/lose
“Look to Powell’s speech about cutting deficit spending. He already said rate hikes will not stem inflation unless Washington cuts spending.”
Guys, read this article. Sharing again.
https://themarket.ch/interview/russell-napier-the-world-will-experience-a-capex-boom-ld.7606
“What if central banks don’t want to play along and try to regain control over the creation of money?
They could, but in order to do that, they would really have to go to war with their own government. This will be very hard, because the politicians in government will say they are elected to pursue these policies. They are elected to keep energy prices down, elected to fight climate change, elected to invest in defence and to reduce inequality. Arthur Burns, who was the Fed chairman during the Seventies, explained in a speech in 1979 why he lost control of inflation. There was an elected government, he said, elected to fight a war in Vietnam, elected to reduce inequality through Lyndon B. Johnson’s Great Society programs. Burns said it wasn’t his job to stop the war or the Great Society programs. These were political choices.”
“Anyone digging Bruce’s new soul music album?”
Not really. I’ve heard two tracks and I am on the fence. It is a lot better than that Wrecking Ball album that I hated.
It does leave me a little problem. I scored 4 seats for his last show in Newark next April. I made a mistake and ended up with front row tickets in the Mezzanine. I paid $500 a ticket (I was going for the $200 tickets) but resale now shows them at $1500.
I was planning on bringing my kids or some friends, but I am not sure all my kids will sit through a 4 hr show. The dude is 73 so how many more years? So do I dump all 4 and cash out. Dump 2 and have a great show with Mrs Fab or a friend. Dump them all and overpay for worse seats?
“interest rate hikes really haven’t changed behavior of actors in the economy”
Until the Fed addresses the Liquidity Lake, all this is window dressing. The banks are awash with cash. Until you get that back out of them this will not resolve. They are now making 3% on the overnight. There is no incentive for the banks to help correct this. The Fed needs to get creative and shut off or severely limit access to the overnight window and let the market fight it out. Those holding have to lend and those needing still pay market.