05-MAY 28-2021

Good old office settingGood morning.
Jobless claims have dropped to a 14-month low.  Based on the latest numbers, initial jobless claims came in at 406,000 against an expectation of 425,000.  About 16 million Americans are still receiving some sort of benefits.  However, many states are ending additional unemployment benefits of $300 per week on top of state levels.  The labor market will continue to trend back to normal, but will still take some time.
Until then, a number of distortions exist.  Average state and expanded federal benefits came out to over $600 per week, or the equivalent of a $15 per hour minimum wage.  With most states at $10 or less, it’s clear that higher wages for lower-level work will be the norm to entice workers back.  For higher wage workers, it means higher costs for the goods produced by lower-wage workers.
This is a phenomenon known as “wage push” inflation, and it was a driver of the higher inflation rates of the 1960s and 1970s.  Its return in 2021 could bode poorly for economic growth.

Now here’s the rest of the news:

Will Inflation Pass or Will It Last? –Reuters Staff,Reuters
If the Fed sticks to its guns in the face of a blowout CPI spike, the dollar could lurch lower still.  That will fuel the commodity rally and boost stocks.  But watch for this… [Read Here]

“Faith is taking the first step even when you don’t see the whole staircase.” –MLK

May 28, 2020

No Magic Here2Good morning.  “Daddy doesn’t know any magic tricks.”
“Daddy knows accounting tricks.”  We’re at an interesting juncture where investors are moving away from the trades that have been working well since the March lows and gravitating to more undervalued parts of the market.
One area that has underperformed is financials.  Banks and other financial companies have seen significant buying activity this week and is an indication of rotation to less loved companies as the economy is reopening.

Now here’s the rest of the news:

crew of NASA astronauts will soon be launched into space!#1.  At 4:33 p.m. yesterday, a crew of NASA astronauts would-have-been launched into space.  According to one insider, this event points to an even bigger story…  Starting today, one that will unlock several trillion-dollar opportunities.
Most individual investors aren’t paying attention to this trend, despite the fact that there are already over 150 space-related stocks you can invest in today.
See, the average investor wrongly assumes that making money in space takes decades.  But  one space stock already nearly tripled investor’s money — in just 2 months.
But this is only the beginning!!!

#2.  “Which way is the stock market headed next?”  — Of course, there is no way of knowing the answer to that question.  [I’m not here to speculate!]

#3.  “If I could only buy one mutual fund right now, which one would it be?”  — People need jobs, and the federal budget cannot afford any more handouts without getting something back in return.  If I’m right about that, then the simplest way to profit is buying shares of the SPDR S&P Global Infra-structure ETF (GII).  This fund is comprised of utilities (46%), industries (36%), and energy companies (18%).

May 28, 2019

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