Archive for the ‘Phil’s Favorites’ Category

Are Stock Buybacks Driving Wealth Inequality?

 

Are Stock Buybacks Driving Wealth Inequality?

Courtesy of 

 

 

It’s not lost on me that we’re posting this on a day where the S&P 500 trades above 3100 for the first time…

Ben Hunt joins Michael Batnick and Downtown Josh Brown at The Compound to explain what he’s so angry about – he sees wealth inequality as being driven by hijacked narratives about capitalism, stock buybacks, central banks and the managerial overclass orchestrating it all.

Follow Ben’s writing at Epsilon Theory here.





The Inevitable Finale Of The Nord Stream 2 Saga

Courtesy of Venand Meliksetian, OilPrice.com

Europe is quickly becoming one of the most important export destinations for gas exporters. Production is decreasing quickly due to political and technical developments. The next few decades are promising for exporters. Nord Stream 2 is arguably one of the most contentious projects currently under development. Denmark recently granted the last necessary permit to start construction activities in its EEZ and analysts now agree that the project’s completion is only a matter of time. In reality, the pipeline’s future was decided long before construction even started due to external factors such as Poland’s decision to diversify away from Russian gas and Western Europe’s determination to turn away from nuclear and fossil fuel production.

Safe but expensive, risky but cheap

The availability and transportation of natural gas are determined by the relative distance between consumers and the production area. A general rule of thumb is that for a distance smaller than 4,000 km or 2,500 miles pipelines are more economic while LNG is more economic for distances larger than that. Political factors, however, trump financial and technical logic. The safety of supply is valued more by countries such as Poland who opt for more expensive alternatives such as the Baltic pipeline.

Historically, the European energy market is dominated by Russia due to its proximity and massive energy reserves. Siberian gas is the most obvious choice from an economic point of view. Politics, however, are what currently dominates the natural gas industry. With that in mind, the persistent support for Nord Stream 2, NS2, by Western European countries and companies, most notably Germany, may appear strange. But a more in-depth look at energy politics in the region and domestic developments, in general, provide somewhat of an answer.

European production is decreasing dramatically, primarily due to the depletion of old gas fields. Also, political motives hamper production such as in the Netherlands where tremors, allegedly due to gas extraction, have reduced political support for the industry. Europe’s biggest single gas deposit, the Groningen field in the Netherlands, will cease operations in 2022. The closure of this gas giant was another reason to support the construction of NS2.

Poland’s


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The PhilStockWorld.com Weekly Webinar – 11-13-19

 

For LIVE access on Wednesday afternoons, join us at Phil's Stock World – click here.

 

Major Topics:

  • 00:01:24 – Coco Cay
  • 00:05:08 – Checking on the Markets
  • 00:06:28 – Money Talk Portfolio: IBM
  • 00:07:28 – China Deal and other Current Issues
  • 00:09:40 – SPX
  • 00:14:54 – Trump and Other Current Issues
  • 00:21:52 – Money Talk Portfolio Review
  • 00:31:30 – Aramco
  • 00:38:01 – BBBY
  • 00:39:04 – Trading Techniques
  • 00:44:36 – SKT
  • 00:53:07 – More Trading Techniques
  • 01:04:42 – Cont. Money Talk Portfolio Review
  • 01:07:03 – HBI
  • 01:08:26 – M
  • 01:12:16 – GOLD
  • 01:14:56 – Companies that are Overvalued
  • 01:17:09 – TSLA
  • 01:17:25 – NFLX
  • 01:18:54 – BKNG
  • 01:20:52 – STP

Phil's Weekly Trading Webinars provide a great opportunity to learn what we do at PSW. Subscribe to our YouTube channel and view past webinars here. For LIVE access to PSW's Weekly Webinars – demonstrating trading strategies in real time – click here to join us at PSW!





Companies promoting causes can be accused of ‘wokewashing’ – allying themselves only for good PR

 

Companies promoting causes can be accused of 'wokewashing' – allying themselves only for good PR

Ben & Jerry’s opened Art for Justice, which highlights the need for criminal justice reform and features art by formerly incarcerated artists. AP Images/Andy Duback

Courtesy of Kim Sheehan, University of Oregon

More consumers want companies to address societal problems, including climate change and crumbling infrastructure.

Additionally, more than half want to buy from brands that take stands on social issues.

At the same time, consumers are increasingly skeptical about these partnerships, seeing them as marketing stunts. It’s called wokewashing.

I’m a professor of brand responsibility, and my forthcoming research investigates brands and their relationships with social issues, including the importance of both allies and advocates.

Allies or advocates

In marketing terms, allies are members of a dominant social group that bring attention to important social issues.

A company can serve as an ally when it works to increase awareness about issues affecting marginalized groups.

Advocates take a more active role, working to change political, economic and social systems.

Companies can be advocates when they create campaigns to promote institutional change and provide financial support for groups engaged in creating social change.

Yoplait’s campaign to address patronizing attitudes toward moms is an example of corporate advocacy.

Another is Stella Artois’ partnership with Water.org to end the global water crisis. This partnership has already raised more than US$3 million in donations to bring almost a million people access to clean water, according to a spokesperson from Water.org.

The brand Stella Artois advocates to end the global water crisis.

Pride month

However, corporate adventures into social issues aren’t always well thought out or received.

For example, consider this year’s Pride celebrations. The number of brands participating in Pride was at an all-time high in 2019. Brands, including T-Mobile, Alaska Airlines and MasterCard, featured supportive messages and announced donations to support…
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Google Slides After Antitrust Probe Expands Into Search And Android Businesses

Courtesy of ZeroHedge

Google shares are sliding into late session after a CNBC report states 50 attorney generals are expanding their investigation into the technology company's search and Android businesses:

  • 50 ATTORNEYS GENERAL PROBING GOOGLE PREPARING TO EXPAND ANTITRUST PROBE BEYOND CO'S ADVERTISING BUSINESS – CNBC

  • 50 ATTORNEYS GENERAL INVESTIGATING GOOGLE PREPARING TO EXPAND ANTITRUST PROBE TO DIVE MORE DEEPLY INTO CO'S SEARCH & ANDROID BUSINESSES- CNBC

The investigation is being led by Texas Attorney General Ken Paxton, who has recently focused on investigating Google’s advertising business.

Several attorney generals in a recent meeting made the decision to expand the investigation into Google’s search and Android businesses, the sources said.

Google shares still ended higher on the day. 

Investors clearly think Google is too-big-to-care.

 





The Fed Has Created the Big Lie for Congress on its Repo Loans while the New York Fed Blocks Freedom of Information Requests

Courtesy of Pam Martens

Fed Chairman Jerome Powell Testifies Before the Joint Economic Committee of Congress, November 13, 2019

By Pam Martens and Russ Martens

Yesterday Federal Reserve Chairman Jerome Powell testified before the Joint Economic Committee of Congress. Only one Congressman, Kenny Marchant (R-TX), had the courage to ask Powell about the Fed’s intervention in the repo loan market beginning on September 17. Since that time the Fed has been pumping hundreds of billions of dollars each week (that the New York Fed creates electronically out of thin air) into its 24 primary dealers on Wall Street. These primary dealers are not commercial banks that might be inclined to use the funds to make loans to local businesses or to consumers to buy a house and help their local economies. No, 23 of the 24 primary dealers are stock brokerage firms and investment banks that engage in leveraged bets in the stock, bond, commodities, and derivatives markets. The 24th is a foreign bank. (See primary dealer list below.)

There is nothing in the legislation that created the Fed, the Federal Reserve Act, that allows it to be the lender-of-last-resort to the trading houses on Wall Street. The Fed’s Discount Window, which is legally allowed to make emergency or seasonal loans, is restricted by law to just deposit-taking banks – not Wall Street trading houses.

And yet, bailing out Wall Street is exactly what the Fed has been doing since September 17 of this year and what it did secretly to the tune of $29 trillion during the financial crisis from December 2007 to the middle of 2010. The Fed does have some leeway in an emergency situation but that has to be brief and defined. The Fed has announced that it’s planning to keep its current money spigot to Wall Street flowing into at least January of next year. But according to Powell’s testimony to Congress yesterday, there’s no pressing crisis on Wall Street. Powell stated that “The core of the financial sector appears resilient, with leverage low and funding risk limited relative to the levels of recent decades.”

Powell knows that it’s a fallacy to say that leverage is low on Wall Street. It’s only low if one ignores the hundreds of trillions of notional (face amount) derivatives residing at the mega Wall Street banks.


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Disney Did In 1 Day What Took HBO 4 Years: 10 Million Streaming Subscribers

Courtesy of ZeroHedge

Somewhere Netflix and Amazon video are sweating.

Disney announced today that Disney+ has reached a stunning 10 million plus subscribers just 24 hours after its launch yesterday in the U.S., Canada, and Netherlands; the figure surprised analysts who had expected a much slower rollout for Disney to reach that level, although let's just ignore that most of the new "subs" are only there thanks to one of the various free streaming offers (perhaps someone should launch WeStream).

Separately, Apptopia reported 3.2 million mobile app downloads in the first 24 hours, with an estimated 89% of mobile downloads in the U.S., 9% in Canada, and 2% in the Netherlands. In just one day, users spent 1.3 million hours watching it, Apptopia said, more than Amazon.com Inc.’s Prime Video, but far less than the 6 million hours watched on Netflix.

"Disney should silence naysayers who expressed reservations about a pivot to streaming," said Geetha Ranganathan, a media analyst for Bloomberg Intelligence. “It took HBO Now about four years to reach about 10 million streaming subscribers.”

That's just the beginning: on Nov. 19, Disney+ will launch in Australia, New Zealand, and Puerto Rico (Puerto Rico’s launch was delayed one week) and will launch in Western Europe on March 31, 2020. While the service experienced first day technical glitches, this was likely due to high consumer demand which was ahead of management’s expectations and not structural issues with the app.

At this fervent adoption rate, Disney could hit its target of 60 million to 90 million worldwide subscribers in just months, if not weeks, and certainly well before the company's original 2024 goal, according to Wedbush Securities analyst Dan Ives. This, of course is bad news for legacy streamers such as Netflix, which could see as many as 10% of its customers lured away to rival services such as Disney+ and one from Apple that launched earlier this month.

Commenting on Disney's stunning disclosure, JPM said that the steep ramp reflects a philosophy of "initial subscribers now; pricing later." Disney's willingness to debut its content-rich service at an attractive price point is leading to massive subscriber growth which will likely lead to pricing power later. To be sure, JPM noted questions arise regarding the ARPU despite


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Below-Average Bull Market

 

Below-Average Bull Market

Courtesy of 

My Chart o’ the Day comes from LPL’s Ryan Detrick, who notes that:

Many consider this bull market the greatest ever, given it has incredibly lasted more than 10 years. But in terms of magnitude, many would be surprised to hear that the 357% gain during this bull market is still beneath the record 417% gain seen during the 1990s.

This bull market also isn’t the strongest in history in terms of gains, even though it has lasted longer than any other bull market…On an annualized return basis, this bull market has gained 15.3%, which is actually weaker than the average bull market annualized gain of 18.9%.

OK, it’s a table, not a chart. But still.

Source:

Putting the Bull Market in Perspective
LPL Research – November 12th, 2019





Impeachment: Two quotes that defined the first day of public hearings

 

Impeachment: Two quotes that defined the first day of public hearings

Top U.S. diplomat in Ukraine William Taylor, left, and Foreign Service officer George Kent are sworn in before the House Intelligence Committee during the first public impeachment hearing. AP/Jim Lo Scalzo/Pool Photo

Courtesy of Kirsten Carlson, Wayne State University and Chris Edelson, American University School of Public Affairs

Editor’s note: Wednesday was the first day of public hearings in the House impeachment inquiry. Two career diplomats – William B. Taylor Jr., acting ambassador to Ukraine, and George Kent, deputy assistant secretary of state for European and Eurasian affairs – gave testimony to the House Intelligence Committee. Two scholars listened, and each picked one quote to analyze.

Kirsten Carlson, Wayne State University

“What we will witness today is a televised theatrical performance staged by the Democrats. – Rep. Devin Nunes, Republican of California

In this highly partisan era, Rep. Nunes’ words come as no surprise. Nunes was attempting to discredit the impeachment inquiry as a partisan attack on President Donald Trump.

But his emphasis on partisanship obscures a vital function of Congress in protecting the public and preserving democratic government: oversight.

Oversight is part of the U.S. Constitution’s carefully orchestrated balance of power among the three branches of government. The Constitution authorizes, if not obligates, Congress to exercise oversight over the executive branch.

The impeachment clause is one of several powers given to Congress that allow it to oversee the executive and judicial branches. Other congressional oversight powers include the power of the purse, the power to organize the executive branch, the power to make laws, the power to confirm officials and the power of investigation.

Congressional oversight exists for multiple reasons. At its most basic, oversight is the review, monitoring, and supervision of the implementation of public policy. It informs the public about how its government is performing its duties.

In short, the framers purposely divided constitutional power among government’s three branches. They allocated oversight authority to Congress to prevent any one branch from amassing too much power, abusing the public trust or generally running amok.…
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Firearm-makers may finally decide it’s in their interest to help reduce gun violence after Sandy Hook ruling

 

Firearm-makers may finally decide it's in their interest to help reduce gun violence after Sandy Hook ruling

The popularity of semiautomatic rifles increases the risk that mass shootings result in multiple deaths. AP Photo/Jae C. Hong

Courtesy of Timothy D. Lytton, Georgia State University

Mass shootings have become a routine occurrence in America.

Gun-makers have long refused to take responsibility for their role in this epidemic. That may be about to change.

The U.S. Supreme Court on Nov. 12 refused to block a lawsuit filed by the families of the Sandy Hook Elementary mass shooting victims, clearing the way for the litigation to proceed. Remington Arms, which manufactured and sold the semiautomatic rifle used in the attack, had hoped the broad immunity the industry has enjoyed for years would shield it from any liability.

The prospect of more claims from victims of mass shootings puts new pressure on the gun industry to reconsider the way it does business.

My research over the past 20 years on lawsuits against the gun industry examines how the threat of civil liability has the potential to promote safer gun designs, encourage more responsible marketing practice and reduce the risk of illegal retail sales.

The end of immunity

A 2006 law called the Protection of Lawful Commerce in Arms Act grants gun manufacturers broad immunity from civil lawsuits that arise out of the criminal misuse of a weapon.

However, this immunity does not apply where a manufacturer “knowingly violated a state or federal statute applicable to the sale or marketing” of a firearm.

The Sandy Hook families allege that Remington, by marketing certain guns to civilians, engaged in “unethical” business methods in violation of the Connecticut Unfair Trade Practices Act. Specifically, they argued Remington “marketed, advertised and promoted the Bushmaster XM15-E2S for civilians to use to carry out offensive, military-style combat missions against their perceived enemies.”

Remington asked the court to throw out the lawsuit based on the federal immunity statute, but the Connecticut Supreme Court held that a violation of the state’s unfair trade practices law qualifies as an exception…
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Zero Hedge

Pope Proposes New Sin: Thou Shalt Not Destroy The Harmony Of The Environment

Courtesy of ZeroHedge View original post here.

Authored by Mike Shedlock via MishTalk,

Pope Francis is fed up with deniers, so much so he is on the verge of declaring a new sin.

Pope Francis proposes ...



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Phil's Favorites

What is an oligarch?

 

What is an oligarch?

Boris Yeltsin shakes hands with Russia’s most powerful businessmen in Moscow. AP Photo

Courtesy of Joel Samuels, University of South Carolina

With the impeachment hearings for President Donald Trump under way, several American diplomats and ...



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The Technical Traders

When Oil Collapses Below $40 What Happens? PART III

Courtesy of Technical Traders

This, the final section of this multi-part research article, will continue our exploration of the consequences that may result from our ADL predictive modeling system’s suggestion that Oil may continue to fall to levels below $40 over the next few months. 

In Part I and ...



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Biotech

Why telling people with diabetes to use Walmart insulin can be dangerous advice

Reminder: We are available to chat with Members, comments are found below each post.

 

Why telling people with diabetes to use Walmart insulin can be dangerous advice

A vial of insulin. Prices for the drug, crucial for those with diabetes, have soared in recent years. Oleksandr Nagaiets/Shutterstock.com

Courtesy of Jeffrey Bennett, Vanderbilt University

About 7.4 million people ...



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Insider Scoop

Glass House Group Appoints Graham Farrar As President

Courtesy of Benzinga

Glass House Group, a California-based cannabis and hemp company, earlier this week appointed Graham Farrar as president.

In his new role, Graham will oversee the company’s short and long-term business strategies, budgets and operations, and report up to Glass House Group CEO Kyle Kazan.

A long-time entrepreneur and an original team member of both Sonos (NASDAQ: SONO...



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Chart School

Dow Jones cycle update and are we there yet?

Courtesy of Read the Ticker

Today the Dow and the SP500 are making new all time highs. However all long and strong bull markets end on a new all time high. Today no one knows how many new all time highs are to go, maybe 1 or 100+ more to go, who knows! So are we there yet?

readtheticker.com combine market tools from Richard Wyckoff, Jim Hurst and William Gann to understand and forecast price action. In concept terms (in order), demand and supply, market cycles, and time to price analysis. 

Cycle are excellent to understand the wider picture, after all markets do not move in a straight line and bear markets do follow bull markets. 



CHART 1: The Dow Jones Industrial average with the 900 period cycle.

A) Red Cycle:...

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Digital Currencies

Is Bitcoin a Macro Asset?

 

Is Bitcoin a Macro Asset?

Courtesy of 

As part of Coindesk’s popup podcast series centered around today’s Invest conference, I answered a few questions for Nolan Bauerly about Bitcoin from a wealth management perspective. I decided in December of 2017 that investing directly into crypto currencies was unnecessary and not a good use of a portfolio’s allocation slots. I remain in this posture today but I am openminded about how this may change in the future.

You can listen to this short exchange below:

...



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Kimble Charting Solutions

Silver Testing This Support For The First Time In 8-Years!

Courtesy of Chris Kimble

Its been a good while since Silver bulls could say that it is testing support. Well, this week that can be said! Will this support test hold? Silver Bulls sure hope so!

This chart looks at Silver Futures over the past 10-years. Silver has spent the majority of the past 8-years inside of the pink shaded falling channel, as it has created lower highs and lower lows.

Silver broke above the top of this falling channel around 90-days ago at (1). It quickly rallied over 15%, before creating a large bearish reversal pattern, around 5-weeks after the bre...



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Lee's Free Thinking

Today's Fed POMO TOMO FOMC Alphabet Soup Unspin

Courtesy of Lee Adler

But make no mistake, if the Fed wants money rates to stay down by another quarter, it will need to imagineer even more money.

That’s on top of the $281 billion it has already imagineered into existence since addressing its “one-off” repo market emergency on September 17. This came via  “Temporary” Repo Man Operations money, and $70.6 billion in Permanent Open Market Operations (POMO) money.

By my calculations that averages out to $7.4 billion per business day. That works out to a monthly pace of $155 billion or so.

If they keep this up, it will be more than enough to absorb every penny of new Treasury supply. That supply had caused the system to run out of money in mid September.  This flood of paper had been inundati...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

Learn more About Phil >>


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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>