Posts Tagged ‘farros’

I know what you are going to think, “just take all guns away and that will stop high school gun violence.”

That’s not what I’m going to say.

Information is the key.

Certainly the community can chime in more… maybe someone heard something or saw something on social media?  I’ve always said “people on the front lines” (whether employees or students) know the most about what’s really going on.

But how do parents fit into this?  In fact, how does a parent with a troubled child know when to ask for help… or even when to turn their child into the authorities?

Most likely a parent in this situation already has their hands full just dealing with a difficult child… imagine how gut-wrenching it would be to make the leap from acknowledging your child is not only difficult but potentially a killer!

Stigma aside, I’m not sure how many parents would be so quick to make that leap… especially in this day & age where violent video games are not just standard fare but celebrated. In other words, what really is normal these days?

What I think we may need — what I think the entire country may need — is some kind of standardized “Child Assessment Test”…

… i.e., some kind of simple, multiple choice test that a parent can honestly fill out and in return get an honest, professional, and *anonymous* psychological appraisal of a child’s mental health as it relates to the potential for mass violence and such.

Having such an assessment might give a parent confidence that they are not acting alone, which would be a tremendous burden lifted.

A website could be setup with a conversational FAQ that could help answer frequently asked questions about the surveys, designed to further advise a parent whether they should seek more immediate guidance to prevent a dangerous situation to others or even the child themself.

Maybe there’s already such a thing?  If not, I think we may be reaching the point where it’s needed.

P.S.  Taking guns away from crazy people — whether student or adult — is a good thing to do, too!

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For some reason, I thought shale was invincible… that is, a technology-enabled, found source of additional oil for many decades into the future.

But I just read a ZeroHedge piece — The Shale ‘Miracle’ & The Reality-Optional World Of Bizarro Finance — and apparently shale isn’t going to be the grand savior after all.

The two original big shale plays, the Bakken in North Dakota and the Eagle Ford in south Texas, have now apparently peaked and the baton has passed to the Permian Basin in west Texas. If the first two bonanzas were characteristic of shale, we can look forward not very far into the future when the Permian also craps out. There are only so many “sweet spots” in these plays.

The unfortunate part of the story is that the shale oil miracle only made this country more delusional at a moment in history when we really can’t afford to believe in fairy tales.

Let’s not give up on renewables quite yet!

 

Last week was quite a ride on Wall Street.  Unbelievably, the Dow traveled 22,253 points in one week — approaching 1x its own index value — I’d say that’s the definition of a wild ride!

Dow Travels 22,253 Points

Everyone is speculating about the trigger.

Other than the obvious reason — which is healthy markets aren’t supposed to go up 100% of the time like we have — two factors seem to have kicked things off.

One had to do with a short squeeze on an ETN (Exchange Traded Note) that tracks the inverse of volatility.  The issue itself was rather harmless in that it did not directly affect underlying securities like some ETFs (Exchange Traded Fund) can.  What wasn’t harmless, though, was it is a leveraged asset… which meant when the pendulum swung, it caused a pretty big short squeeze… which meant that people probably had to sell other assets — like stocks — to cover.  So, ultimately, it’s plausible that these did have some affect in the market last week… selling pressure is, after all, selling pressure.

The other — which people consider the bigger culprit — was a reported surge in hourly earnings reported in last Friday’s (2/2/18) jobs report.  While that signals a healthy economy, which of course is good for the stock market, it also signaled that interest rates might start rising… which, ironically enough, is actually historically good for the stock market, too, at least during the initial rising phase.

But, in last week’s case, people got flat out freaked out.  Hence, the wild ride.

But, it appears that no one asked why hourly earnings surged.  From ZeroHedge:

Well, not so fast, because as a closer look at the data reveals, the only reason why average hourly earnings rose, is because the total weekly hours worked posted a relatively steep decline, dropping from 34.5 in December to 34.3 in January, a 2.9% drop from the 34.4 last January.

What economists (and Wall Street analysts!) should care about is actual earnings power… and average weekly earnings actually declined from December to January.

Seems like no one wanted to let facts get in the way of a good panic.

 

P.S.  Investor sentiment is always the biggest wild card in the deck.  But, weekends are good circuit breakers in that regard.  More and more folks are coming to the conclusion that a lot of what is underpinning the market is still intact.  Readers of my blog know I track the price of oil… and oil has not only been behaving, but has been declining… which I believe bodes well for spending… which bodes well for corporate profits… which bodes well for the market.

I’m a big Jimmy G. fan… as is everyone in the Bay Area.

However, I can remember being a big Colin Kaepernick fan as well… as it seemed everyone was in the Bay Area, too.

And why not?  Kaep ran wild against the mighty Packers in a playoff game.  He — single-handedly — was reinventing the quarterback position.  He brought us to Conference Championships and even the first Super Bowl in many years… came within a whisper of winning it, too.

I even remember a friend posing the ultimate question:  “Would you rather have Aaron Rodgers or Kaep leading your team into the future?”  I remember at the time it feeling very much like a toss up.  Rodgers already had one MVP under his belt (and would get another in 2014), but we were all punch-drunk with the p-o-t-e-n-t-i-a-l.

So, when everyone asks, “what could possibly go wrong with making Jimmy G. the highest-paid football player in the league after only starting seven games?!” it’s hard not to think we were all feeling just as giddy about Kaep at one point…

… a feeling that seemed to go away as fast as it came.

P.S.  With that said, I want to say for the record that I was one of the fans at this year’s incredible Niners-Titans game screaming, “Let Jimmy kick!  Let Jimmy play D!  Let Jimmy coach!”  Certainly seems like he can do anything he puts his mind to on a football field.  :)

I remember the first Gulf War back in 1991.  The entire world was freaked out, including — especially — the financial markets.

Yet, the day we attacked, the Dow had one of its best days ever.

I remember hearing the phrase, “flight to quality.”  That is, when the going gets scary, the smart move to safe and trustworthy investments.

On that January 18th day back in 1991, it was IBM that people flocked to… IBM being, back then, the most important tech company on the planet.

Over the last few days, it’s been AAPL.

I think this puts a lot of the nitpicking criticisms of AAPL in appropriate perspective:  When the going is tough, the tough don’t hesitate to flock to Apple.

Lots of downgrades for Apple over the last few weeks.  The stock was spooked from a $180 level just two weeks ago to around $166 today.

It has nothing to do with the holiday quarter that Apple is going to report on tomorrow after the market’s close… that, people believe, will come in at record levels.

No, it has to do with how the iPhone X is selling this quarter.  Channel checks with suppliers indicate Apple is slashing its expectations of iPhone X sales this quarter… by as much as half

… which certainly seems like a huge let down given that the iPhone X is supposed to be the flagship product and the first iPhone to crack the $1,000 price barrier.

But… come on, people… did you really think a $1,000 iPhone X should sell in consumer numbers?  It’s not supposed to be a volume leader… rather, it’s supposed to be something exclusive and, quite frankly, unattainable for many.

That’s the whole point… to have a high-end iPhone entrant that (1) makes the device/technology more desirable, and (2) contributes in some way to an even higher overall iPhone family “ASP” or Average Selling Price (which is already the highest in the industry).

My guess is — since there are no negative reports on the iPhone 8 — that it’s not only selling well, but making up for any short-fall from the iPhone X… after all, if they’re not buying an iPhone X, they’re buying one of the other not-so-cheap models.

Additionally, don’t be surprised if some of Apple’s “smaller” businesses — like cloud & other services — make meaningful contributions, too.  Even the analysts that have raised flags on the iPhone X agree that last quarter should be pretty spectacular for the company.

And, finally, I always have to throw in the irrationality of the market:  Apple, one of the most stellar tech companies in the world according to any measure (even growth), has a P/E of 14.2 forward earnings… while the average company in the S&P 500 has 18.6.  If you’re looking at tech leaders, Google has a forward P/E of 28… and Amazon has — wait for it — 168.  Go figure.

AAPL has been beaten down so much by negative sentiment in the last few weeks that I think we might have a nice setup for a pop after earnings tomorrow.

At least, that’s what the contrarian in me thinks.

Don’t get me wrong, I love what Bitcoin/Blockchain is doing — disintermediating the financial system (and more!) — which is completely cool.

However, wasn’t so long ago that an upstart named Visa grew to dominate another “cashless” payment mechanism.

Today Visa has about a $260 billion market capitalization and over $18 billion in revenues.

Today Bitcoin has about a $260 billion market capitalization and I believe about $0 in revenues.

If that doesn’t feel like “dotcom explosion 2.0,” I don’t know what does.

As for Bitcoin making money, apparently transaction fees — something that used to be near-zero and a major competitive advantage for Bitcoin — are now trending around $10-$20 per transaction.  Apparently not a major competitive advantage any longer.

Seems to me Bitcoin/Blockchain has an extra long ways to go before it stands toe-to-toe with Visa.