October 14, 2022
The quality of your relationships determines the quality of your life.
– Esther Perel
THOUGHTS FROM DOUG
Goods inflation is declining as services inflation is rising. Will goods inflation start rising again once a post-Covid China reopens its economy?
I sure hope we are not underestimating Russia and China’s commitment to their aspirations. And I sure hope we are not overestimating our capabilities and global influence.
If recession is coming, might the world be preparing to transition from sky-high inflation to deep-trough deflation?
Both economic expansions and economic contractions seem to feed off themselves. Three things generally turn contractions into expansions: fiscal and monetary stimulus, new products we all need but don’t have (think PCs and cell phones), and then there is war.
Inflation is a mess. Recession is around the corner, if not already here. Globalization is unraveling. A new era of war seems to have started. We’re back to a period of nuclear threats from Russia and North Korea. The UK may be imploding. Europe may follow. Mental health is collapsing. It must all be Trump’s fault.
Just another reminder: The S&P 500 Index bottomed out at 8X PE during the 1970s inflation battle. Right now, it’s a bit less than 20X. Also, a “normal” economic trough multiple is around 12X.
Did you see the recent article suggesting EV drivers were soon going to be told when they can and cannot charge their cars? Turns out, charging EVs at night—as most EV car owners do—may not be a viable option for long.
I ate at a top-rated and really fancy and expensive restaurant a few nights ago. Meh.
When AI takes over more information processing jobs, what jobs will those people have?
Is India finally about to become the next China?
Given the energy, economic and political crisis in Europe, why is it so many in the US seem to think Europe’s is the economic and political model we should follow?
THE ECONOMIC VIEW
Mortgage rates at 20-year high
Where home prices are going to fall most
Check out the map.
National debt is soaring globally
Is debt the real economic engine?
Yet interest rates are rising everywhere
Used cars are now unaffordable
Thank price and interest rate rises.
September retail sales were flat
IMF keeps cutting growth forecasts
When’s the next cut?
THE INFLATION BOGEYMAN
PPI up 8.5% in September
While September CPI was 8.2%
6.6% core inflation at 40-year high
Sticky services inflation is rising
Core inflation may not have peaked
Rents are set to keep it high.
Fed remains committed to higher rates
Costs rising faster than prices
At most US companies.
THE LABOR VIEW
Gen Z are big union supporters
Is a labor generational change coming?
Manufacturing employment is rising
The next hot job market?
US clothing makers are coming back
Are employers hoarding workers?
Because it’s so difficult to hire.
We’ve exceeded pre-pandemic job growth
Now we’re headed into recession.
Now we’re headed into recession.
THE UK IN CRISIS
The upside of UK pension crisis
They’ll get to reinvest at higher rates.
UK pensions may have a big problem
They need to raise cash fast!
Government tries to help, but…
They have until today to fix things
Here’s the new backup plan
UK needs to cut 200K government jobs
Those are voters, you know.
MEANWHILE IN EUROPE
French oil workers are striking
They want more of the spoils.
German experts propose gas subsidy
Will they eventually have to nationalize?
Germany backs joint EU debt
The end of discipline in the EU?
EU to ban forced labor products
Will Apple’s iPhone be one?
THE NEW ENERGY TRANSITION
Europe still buying Russian O&G
To the tune of about $250MM a day!
Europe has shale gas
They just won’t drill for it.
They’d rather cut Eiffel Tower lights
UK launches massive O&G leasing round
Will green thinking retreat?
PLAYING WITH FIRE
Was Danish infrastructure sabotaged?
Was a German train sabotaged?
Did Nord Stream signal a new war chapter?
A new general is leading Russia in Ukraine
Known for his “total ruthlessness.”
This war could get uglier
Belarus and Russia are deploying joint military group
Russia recruits a country to help with war.
GLOBAL
Antidepressant consumption
Is growing around the world.
Global poverty is also growing again
First pandemic, now global chaos?
Global student-teacher ratios
Students in Norway have it best.
A NEW WORLD ORDER?
Russia cozies up to the UAE
They have economic common ground.
Poland, the new NATO heavyweight
Germany and France may not be happy.
India builds its first military helicopter
More military arms makers are coming.
THE FINANCE WORLD
US banks see loan losses ahead
They’ve set aside $4B, so far.
Here comes a $500MM loan loss
The new favorite asset class.
Could it be bonds?
Is the old leveraged bond strategy dead?
Companies are pausing M&A
Waiting for recession bargains?
TECHNOLOGY
PC shipments plunge
While Meta releases its VR headset
Order it here to escape reality
Hackers are stealing home loan payments
They prey on the dumb.
Chipmakers report giant demand contraction
As Biden clamps down on exports to China
THE CRYPTO MEME
Hackers stole back crypto
That the US government had previously seized.
North Korean crypto hackers
Are financing armageddon.
Bitcoin mining surges
More tulips are coming.
THE NEXT NORMAL
Economist Nouriel Roubini’s Megathreats
Is a book you want to read but really don’t.
The Great Barrier Reef is flourishing
Wasn’t it supposed to be dying?
Young folks are leaving NYC
It’s just too darn expensive.
THE WAR ON CARBON
How green are biofuels?
Maybe not so green.
US opens new cobalt mine
Where’s the waste going?
Truss bans some solar farms in UK
So wandering sheep don’t get burned.
Rural Europe not so keen on solar either
THE CHINA SYNDROME
Here’s how we’ll know
When China is about to invade Taiwan
Biden keeps poking China in the eye
Suggesting “no possibility of reconciliation.”
China seeks to leapfrog the world
With a new quantum computer.
Covid is flaring up again in China
Is lower economic output coming?
THE WASHING-TONE
White House calls this a “decisive decade”
Competing with Russia and China.
Yet Russia is #57 globally in GDP per capita
Federal bureaucrats buy stock
In companies they regulate. Yikes!
Biden’s gig worker proposal
Calls for making them employees.
MAKING A BETTER YOU
The key to children’s health
May be family dinners together.
Breathe deeper
The benefits are great.
A scientific study has determined
That petting dogs is good for you
HOW ABOUT A BREAK
Put sleep tourism on your bucket list
Yep, you read that right.
Can you feel music?
If so, you may have lots of empathy.
NASA’s DART deviated asteroid path
Is there something they’re not telling us?
SONG OF THE WEEK
“Purple Rain”
Prince and the 1980s.
Lyrics are poetry, you know.
VIDEOS OF THE WEEK
This is crazy pants nuts!
Come on, this can’t be real!
But this was real:
The Greatest Beer Run Ever
1956 French Canadian bike race
It’s just groovy, man, groovy.
CASTING AROUND THE PODS
Tulsi Gabbard lays it all out
Why she left the Democrat party.
FROM THE HEADHUNTER’S KITCHEN
Purple tomatoes
Coming to your store soon.
The most popular grocery stores
By state
Cooler weather means soup time.
Homestyle chicken noodle
Creamy roasted cauliflower
French onion
Easy minestrone
Hungarian mushroom
Chicken tortilla
Spicy black bean
Baked potato
IN CASE YOU MISSED IT
GE Struggles With Wind Business
October 7, 2022
The Era of Super Abundance
September 30, 2022
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