Lots of interesting news this evening. Let's begin with the master of no-profit growth, Amazon.
Financial Markets and Economy
Amazon hiring more than Penney's, Walmart combined (CNBC)
Leaving one widely watched holiday hiring forecast in the dust, Amazon (AMZN) said Tuesday that it will add 25 percent more seasonal workers this year, outpacing many of its bricks-and-mortar competitors who plan to keep hiring flat.
Five Bad Reasons For The Fed To Raise Rates Now And One Good Reason Not To (The Big Picture)
A couple of days before the September 16-17 FOMC meeting, I happened to be listening to the NPR program, “On Point”, the subject of which was the appropriateness of a Fed policy interest rate increase at that time. Of the guests on the show, the principal advocate of Fed “lift-off” was a William Cohan, who had written an August 28 New York Times op-ed entitled “Show Some Spine, Federal Reserve”. As much as I disagreed with Mr. Cohan’s reasons for why the Fed should have raised its policy interest rates on September 17, reasons that I assume Mr. Cohan still would believe valid now, I was delighted to hear them. I was delighted because Mr. Cohan’s and others’ arguments in favor of immediate Fed interest rate hikes provided me with material for this commentary.
Ferrari Raises $893 Million in IPO, Pricing Shares Top of Range (Bloomberg)
Ferrari NV raised $893 million in its U.S. initial public offering, pricing the shares at the top end of the marketed range after investor demand in the supercar maker outstripped the stock available.
Bad news for some Medicare beneficiaries (CNBC)
The year 2016 will send shockwaves to some Medicare beneficiaries — roughly 7 million Americans. They're going to be paying a lot more for their monthly Medicare Part B premium.
Individuals affected will see their monthly premiums rise from about $104.90 to $159.30, and $318.60 for married couples.
Tesla shares slide 9% after Consumer Reports drops Model S recommendation (Market Watch)
Tesla Motors Inc. shares fell sharply Tuesday after Consumer Reports dropped the Model S from its list of recommended cars and gave the all-electric sedan a worse-than-average reliability score.
About 1,400 Tesla TSLA, -6.61% Model S owners responded to the magazine’s latest reliability survey, released Tuesday, reporting door-handle malfunctions, problems with drivetrains, charging equipment and touch screens, squeaks and rattles, and “full blown” replacement of electric motors, the magazine said.
Yahoo has signed a deal with Google to provide search ads (Business Insider)
Yahoo has signed a non-exclusive deal with Google to provide search ads for Yahoo's search results.
Under the deal, Google will provide the search ads and pay Yahoo an undisclosed percentage of the revenue from them.
Yum Bondholders Face Rising Leverage, Junk Status in China Split (Bloomberg)
Yum! Brands Inc.’s bondholders are feeling slighted after the fast-food company moved to separate its China business from the U.S. parent, leaving it with less revenue to service $2.65 billion of debt.
There's not much junk in the S&P 500 (Business Insider)
The junk bond market has attracted a lot of attention lately, as spreads have blown out.
What to look for in Under Armour’s earnings (Market Watch)
Athletic apparel maker Under Armour Inc. is scheduled to report third-quarter earnings before the bell on Thursday. The company seems to be having a good year with its stock up nearly 50% and the athletes it endorses enjoying major success and pushing the brand name further into the spotlight.
Carmakers Find New Fuel-Economy Hardware Causes Quality Issues (Bloomberg)
As automakers race to meet tougher government fuel-economy standards that take effect in the next decade, they are finding trouble with some of the hardware that will get them there, according to a Consumer Reports’ survey.
Hedge funds suffer biggest quarterly drop in assets since 2008: data (Business Insider)
Hedge funds suffered their biggest quarterly loss in assets since the financial crisis during the three months that ended in September, data released on Tuesday showed, putting the industry on track for its worst year since 2008.
This chart shows why you should stop bad-mouthing the economy (Market Watch)
The U.S. economy is much stronger than both the equity and bond markets give it credit for, making an easy case for the Federal Reserve to raise interest rates this year, according to Deutsche Bank’s top economist.
Sonic Rises After New Ad Strategy Helps Boost Earnings Forecast (Bloomberg)
Sonic Corp. advanced the most in nine months after raising its forecast for earnings growth, saying its advertising programs are boosting sales while new equipment in its restaurants is trimming costs.
Profit in the year through August 2016 will rise 16 percent to 20 percent on a per-share basis, the Oklahoma City-based company said Monday in a statement. That’s up from a previous forecast of 14 percent to 18 percent growth.
IBM's stock is getting pounded as the company struggles to transform itself (Business Insider)
IBM's stock is down more than 5% Tuesday, as investors digest the company's disappointing third quarter results.
IBM reported a beat on its non-GAAP earnings per share profits but missed on revenues.
Canada Marijuana Stocks Surge as Liberals Vow Legalization (Bloomberg)
Canadian marijuana stocks jumped after Justin Trudeau’s Liberal party clinched a decisive victory in the country’s election Monday, with a pledge to legalize the substance among his policy promises.
Canopy Growth Corp. increased 11 percent to C$2.43 at 10:38 a.m. in Toronto after climbing as much as 21 percent. Aphria Inc. rose 5.3 percent to C$1 and Mettrum Health Corp. gained 7.6 percent to C$1.98 after jumping 18 percent. The companies already produce marijuana for medical use, which is legal in Canada.
You’re Not Supposed to Understand the Federal Reserve (NY Times)
Imagine if aliens in a spacecraft were studying the United States from above. Their conclusion, I expect, would be that the single most important decision these inscrutable humans make each year is whether to plant corn, soybeans or wheat. No decision, year after year, transforms more square miles of American land than the choice farmers make about which crops to grow.
Weight Watchers is going parabolic again (Business Insider)
Weight Watchers shares are going parabolic again.
After rallying more than 100% on Monday, shares were up by as much as 30% in morning trading on Tuesday.
[If only Oprah Winfrey would join the Board of Governors of the Federal Reserve.]
Politics
The new game (The Economist)
A CONTINENT separates the blood-soaked battlefields of Syria from the reefs and shoals that litter the South China Sea. In their different ways, however, both places are witnessing the most significant shift in great-power relations since the collapse of the Soviet Union.
Where Hillary Clinton is leading — besides the polls (Market Watch)
Hillary Clinton widened her lead over her rivals for the Democratic presidential nomination in a new Wall Street Journal/NBC News poll. That was encouraging news for her. But another measure may be even more promising.
Canada Has a New Government, and Some Nasty Old Problems (Bloomberg)
After an election centered on Canada's economy, that's the takeaway from HSBC Bank Canada Chief Economist David Watt for Prime Minister-in-waiting Justin Trudeau. The oily tide has gone out, the economist warns, and now the nation's drivers of growth—or lack thereof—have been laid bare for all to see.
Bernie Sanders's Highly Sensible Plan to Turn Post Offices Into Banks (The Atlantic)
In an interview with Fusion’s Felix Salmon the day after last week’s Democratic debate and published Tuesday, Senator Bernie Sanders discussed the marquee features of democratic socialism he’s been tirelessly calling for during his presidential campaign: higher taxes for the wealthiest Americans, an increased minimum wage, and breaking up the biggest Wall Street banks.
Technology
Citi launches financial technology unit (Business Insider)
Citi announced the creation of a financial technology unit that will focus on making the US bank ready for a “mobile-first future,” according to an internal memo obtained by the Wall Street Journal. The move is reportedly the first step in a company-wide reorganization that will place smartphone-based banking at the forefront of Citi’s strategy, according to PYMNTS.
Health and Life Sciences
Lung cancer will ‘eat’ almost anything to survive (Futurity)
Scientists think it’s possible to starve lung cancer by blocking access to other sources of food when sugar is scarce.
The metabolism of cancer cells is very different from normal cells. Rapid proliferation means that cancer cells have increased energetic needs. This need is met using glucose (sugar) as the main source of nutrition.
Pertussis Booster In Every Pregnancy Safe For Mother And Child, Study Finds (Forbes)
The resurgence of pertussis, or whooping cough, in recent years has left doctors, researchers and public health officials scrambling to find ways to protect those most likely to die from the disease: infants under 2-3 months old who are too young to be vaccinated. The most promising strategy — giving mom a dose of the pertussis vaccine toward the end of her pregnancy — means getting a booster in every pregnancy. The booster, called Tdap, actually protects against tetanus, diphtheria and pertussis.
Mammography Use Cut Back in American Cancer Society Guidelines (Bloomberg)
The American Cancer Society changed its guidelines for early breast cancer detection, recommending that women wait until age 45 instead of 40 to start annual mammograms, then slow the pace at 55 to screenings every other year.
First Gene-Edited Dogs Reported in China (Technology Review)
An extra-muscular beagle has been created through genome engineering. Are we on our way to customizing the DNA of our pets?
Life on the Home Planet
These CIA-vetted Syrian rebel groups fighting Assad are Russia's primary targets (Business Insider)
Since 2013, the CIA has been training and equipping various moderate rebel elements in the Syrian civil war in an effort to undermine the regime of Syrian President Bashar al-Assad and force him to the negotiating table.
[If you’ve been following, this is not a surprise.]
Africa fear for deadly malaria strain (BBC)
A drug-resistant malaria parasite found in South East Asia can also infect mosquito species in Africa, a study shows.
The transmission experiments were carried out in a laboratory, but they suggest the spread of this deadly strain into the continent is possible.
Lamar Odom’s $75,000 Brothel Binge: How He Racked Up That Massive Bill (The Wrap)
The former Los Angeles Lakers star used his credit card for a five-day around-the-clock “girlfriend experience” package at the Love Ranch, per owner Dennis Hof. In addition to sex, activities included cooking, watching TV and going out to dinner, per the plan.
Doing some hooker math, there are 120 hours in 5 days, which means the hourly rate is about $625. Split between two prostitutes, that comes down to $312.50 apiece — about what you’d pay for a lawyer, except the screwing you get from a lawyer is a lot less pleasant.
[Thank yous to Pixabay for use of some images: screws, sugar, chess set, toy men from Amazon.]
