Dear New World Investor:
What a week! Inflation vs. the Fed, labor markets vs. the Fed, OPEC+ vs. the Fed…no wonder everyone feels like the collateral damage of a drive-by shooting, even after the best two days in the market since April 2020. Let’s dive in.
First, last Friday we learned that the personal consumption expenditures price index rose 0.3% in August after dipping 0.1% in July. In the 12 months through August, the PCE price index increased 6.2%, down from 6.4% the previous month. But excluding volatile food and energy, the Fed’s favorite way to measure inflation, the core PCE price index jumped 0.6% last month after being unchanged in July and climbed 4.9% on a year-on-year basis in August after increasing 4.7% in July.
As a result, the Fed raised its median forecast for core PCE inflation to 4.5% this year from its previous estimate of 4.3% in June. Its estimate for core inflation in 2023 was boosted to 3.1% from the previously projected 2.7% in June. That’s above their 2% target and at first glance suggests they won’t be backing off the interest rate increases any time soon.
But we know (1) the Fed isn’t very good at forecasting inflation; and, (2), the bond market disagrees. The breakeven rate on five-year US Treasury Inflation-Protected Securities (TIPS) is at 2.127%. The 10-year TIPS breakeven rate is 2.102%, indicating the market sees inflation averaging about 2.1% a year for the next decade. The rate has declined from more than 2.6% it showed five weeks ago. The US dollar five-year forward inflation-linked swap, seen by some as a better gauge of inflation expectations due to possible distortions caused by the Fed’s quantitative easing, was last at a similar 2.141%
Why is the bond market so sanguine? Because it knows the economy is slowing faster than the Fed thinks. For example, the Job Openings and Labor Turnover Survey (JOLTS) is a very sensitive indicator of the labor market. That’s because when employers get cautious, the first thing they do is stop hiring before they start firing. The latest survey showed a sharp 1.2 million drop in job openings, from 11.239 million to 10.053 million, the lowest number since June 2021. The consensus estimate was for an increase to 11.088 million. It was the second biggest JOLTS drop on record – only the COVID-19 lockdown in April 2020 was worse.
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This is exactly what Fed Chairman Powell has been looking for. On September 22 he said: “Job openings could come down significantly—and they need to—without as much of a an increase in unemployment as has happened in earlier historical episodes.” Fewer openings to take the upward pressure off wages, not necessarily fewer people employed.
Although this is the first official indicator to point unambiguously to a clear slowing in labor demand, in the last month the ADP employment change is trending down while the Challenger planned job cuts survey is rising, The nonfarm payrolls report (upper left in the graphic below) for September will be reported tomorrow, with +250,000 expected, down from +315.000 in August.
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Even though September quarter real GDP is likely to be positive, we are in a recession. It won’t be “official” until the National Bureau of Economic Research establishes the dates, but those worthies always move slowly. The US has never had two negative GDP quarters in a row, as we had in March and June, when it wasn’t later labeled a recession. 100 years of history show that recessions were always able to bring inflation down under 2% If you hit demand hard enough, you’ll get there. How long does it take to slow the Consumer Price Index from 6%-10% to under 2%? Using 1948, 1969, 1990, and 2008 as examples, anywhere between 5 and 30 months (16 months on average).
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Market Outlook
In spite of the retracement of the last two days, thanks to the Monday-Tuesday rally the S&P 500 added 2.9% since last Thursday. The Index plunged 9.3% in September, its worst September since 2008. According to FactSet, the forward price-earnings ratio for the S&P now is 15.4x, below the five-year average of 18.6x and below the 10-year average of 17.1x. The Index is down 21.4% year-to-date.
The Nasdaq Composite gained 3.1% after both the S&P and the Composite closed out their first three-quarter losing streaks since the 2008 Global Financial Crisis. It is down 29.2% for the year. Just a reminder that the Composite is still +13.6% above its pre-Covid high. The small-cap Russell 2000 soared 4.6% for the week but still is down 21.9% in 2022.
The S&P is at a historically low percentage deviation from its 200-day moving average. That doesn’t mean it has to bottom tomorrow, but it does mean stocks are relatively cheap.
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The Index has fallen below -25% for the only fourth time in the past 30 years.
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The fractal dimension may be reversing back to consolidation here, but another down week would reassert the downtrend that could last until the Santa Claus rally starting in mid- to late-December.
Top 5
Changes this week: None
Near-Term – chronological order
AAPL Apple – New iPhone preorders
OIL iPath Pure Beta Crude Oil Exchange-Traded Note – crude should rise quickly
GBTC Grayscale Bitcoin Trust – Bitcoin is coming out of one of its periodic sharp drops
INO Inovio – INO-4800 China trial results and VGX-3100 HPV Phase 3 results by yearend
META Meta – Bounce from overdone selloff
VLD Velo3D – Rapid revenue growth; low market cap
Long-Term – alphabetical order
GRPH Graphite Bio – second-generation genetic editing
NVTA Invitae – the winner-take-most of genetic testing
META Meta – a leader in the metaverse
RKLB Rocket Lab – #2 to SpaceX in space
VLD Velo3D – Return manufacturing to the US
Economy
New orders fell to a 28-month low in September.
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But the Atlanta Fed’s GDPNow model estimate for September quarter real GDP growth unexpectedly jumped to +2.7% due to strength in personal consumption expenditures and private domestic investment.
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Coming Events
All times below are ET, and most presentations and slides are archived on the companies’ websites so you can listen to them.
Friday, October 7
September payrolls – 8:30am – +250,000 expected
Tuesday, October 11
Short Interest – After the close
Wednesday, October 12
AG – First Majestic – Through 10/15 – New Orleans Investment Conference
CMPS – Compass Pathways – 8:00am – Investor Day; Phase 3 protocols
Thursday, October 13
Consumer Price Index – 8:30am – +8.0% year-over-year expected;
+0.3% month-over-month
The $20-For-$1 Stocks
Say you put $2,000 into a stock that goes from 50¢ a share to $10. The $2,000 turns into $40,000. Then you put the $40,000 into another stock that goes from 50¢ to $10. That turns the $40,000 into $800,000. You did it with two stocks, and never risked going negative more than $2,000. (Not that you won’t be mad at me if the first one works and then the second one doesn’t, taking your $40,000 to Money Heaven.)
If you can afford it – and it would not be too big a position in your portfolio – putting $2,000 into each of these 12 speculative biotechs might be a good way to start.
The market capitalizations of these recommendations are typically very low. At the same time, Initial Public Offering valuations had moved very high. We were seeing $750 million to $900 million valuations for a good preclinical/Phase 1 IPO, and even $300 million to $500 million for mediocre Phase 1s. I don’t see how investors make 5x to 10x in a reasonable, three- to four-year period if they buy at those valuations. How many biotechs have moved north of $10 billion within 5 years after pricing an IPO in the $700 million to $900 million range? Hardly any. Buying these out-of-favor, fallen, or forgotten companies that can get important products through the FDA at very low market capitalizations seems like a much better strategy to me.
Risks
Development-stage biotechs are subject to investor sentiment swings from wildly optimistic to excessively pessimistic – mostly the latter recently. After the Primary Risk for each company, I’ve added the clinical stage of their lead product, the probable time of their first FDA approval, and the probable time of their next financing.
As always, you need to think about an appropriate position size. You could buy a full position upfront and then just hold on, or buy some upfront and leave room to add more on the inevitable financings, transient clinical trial setbacks, and the like.
Compass Pathways (CMPS – $11.66) is holding their Investor Day next Wednesday. They are going to cover the design of their Phase 3 program in treatment-resistant depression, the TRD treatment landscape, their commercial strategy, digital tools, and the pipeline. In addition to management, they have doctors from UCSD, the Dell Medical School, and Duke Medical School, all of which probably will be trial sites. CMPS is a Buy under $20 for a very long-term hold to a 10x.
Primary Risk: Their drugs fail in the clinic.
Clinical stage of lead product: Phase 2
Probable time of first FDA approval: 2024
Probable time of next financing: Mid-2023
Invitae (NVTA – $2.68) will benefit from Illumina’s new genome sequencer that runs twice as fast as its current machine and can drive the cost down to $200 per. Investors don’t realize that Invitae’s value-add is their comprehensive network of experts who can read and interpret the results of sequencing, plus the easy-to-use interface for doctors and patients. Invitae can maintain their profit margins while the lower cost per sequencing means faster adoption by mainstream medicine. Buy NVTA under $10 for a first target of $50 and eventually $100+ when they become the Amazon of genetic testing.
Primary Risk: A competitor starts taking significant market share.
Clinical stage of lead product: NM
Probable time of first FDA approval: NM
Probable time of next financing: Not needed
Biotech & Digital Dominators MegaShift
There are at least four ways to make money in the stocks of these large, growing, dominant companies. You can:
* * Buy a stock and hold it
* * Buy a stock and write a call option against it
* * With a Level IV options account, write an out-of-the-money put option
* * With a Level IV options account, write an out-of-the-money put option and use part of the premium to buy an out-of-the-money call option
Corning (GLW – $31.49) presented at the Goldman Sachs Communication & Technology Conference (TRANSCRIPT HERE). Jeff Evenson, EVP & Chief Strategy Office, said: “…since 2020, we’ve invested $500 million in expanding our optical communications capacity. This has increased our ability to serve the US market alone by approximately a factor of two. Overall, we’re witnessing a massive transformation that integrates digital technology and the related connectivity into almost every aspect of our lives and we’re still in early days of this transformation. As the only large scale end-to-end supplier of passive optics, Corning is uniquely positioned to support this transition and our results demonstrate the progress.”
In the June quarter, Optical Communications increased 10% sequentially and 22% year-over-year to $1.3 billion, 36.3% of total sales. GLW is a Buy under $33 for the 5G cellular buildout, followed by the smartphone upgrade to use 5G services. My first target is $60 in 2023 .
Other Tech
Liberty Media Acquisition Corporation (LMACA – $9.95) has given up on finding a good acquisition and will return everyone’s $10 a share by the end of this year. I recommend selling the stock at $9.95 or better to redeploy the money into something with more upside.Sell LMACA .
Primary Risk: No deal is announced by 1/216/23 and we have to redeem for $10 a share.
Probable time of next financing: None needed
Rocket Lab USA (RKLB – $4.62) will have its eighth launch of the year, a company record, tomorrow, It is the 31st Electron launch and the 151st satellite into orbit. RKLB is a Buy up to $13 for my $30+ target as low earth orbit satellites and space exploration grow.
Primary Risk: A new competitor emerges.
Probable time of next financing: None needed
Inflation MegaShift
Gold ($1,720.90) rallied on the OPEC+ announcement (see below). There are lines in Vienna to buy gold and bullion dealers in London are out of gold. If I lived in the Eurozone and was getting paid in euros, I’d probably line up to buy gold, too.
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The fractal dimension showed more of the endless consolidation as gold regained the 61.8% retracement level.
Silver closed today at $20.68, but JM Bullion is buying Silver Eagles for almost $30 each. The disconnect between the paper price and the real price is almost unbelievable. The fraud in the paper markets is obvious. It gets corrected by a silver squeeze that drains the COMEX and LBMA.
Miners & Related
Paramount Gold Nevada (PZG – $0.32) filed its S-K 1300 Technical Report Summary on the Feasibility Study for its Grassy Mountain mine. S-K 1300 is a new SEC requirement for US mining projects that allows the disclosure of Mineral Reserves and Resources.
They showed Proven & Probable reserves of 380,000 ounces of gold and 554,000 ounces of silver. Measured & Indicated resources are 755,000 ounces of gold and 3.01 million ounces of silver. The mine shows a total after-tax free cash flow of $182 million with an after-tax Net Present Value at a 5% discount rate of $114 million and an internal rate of return of 22.45%. The total market capitalization of PZG today was only $15 million. PZG is a Buy under $1 for a $10 target as gold moves higher.
Primary Risk: Prices of precious metals fall due to US dollar strength.
Probable time of next financing: Second half of 2022
Sandstorm Gold (SAND – $5.22) announced record sales and revenues in the September quarter. They sold 22,600 attributable gold equivalent ounces and realized preliminary revenue of $38.9 million, compared to 15,514 attributable gold equivalent ounces and $27.6 million in revenue for the comparable period in 2021. They had cash operating margins of $1,282 per ounce.
CEO Nolan Watson did a brief video update on the business and the reasons for the recent stock sale:
SAND is a Buy under $10 for a $25 target.
Primary Risk: Prices of precious metals fall due to US dollar strength.
Cryptocurrencies
Cryptocurrencies are a diversifying asset that offer a unique opportunity to make (or lose!) a lot of money quickly. You can easily buy Bitcoin and other cryptocurrencies at Coinbase, Block, or Robinhood.
Bitcoin (BTC-USD on Yahoo – $20,052.75) regained the $20,000 level, as expected. It continues to act more like a high-beta stock than a safe haven/store of value, and that probably will continue for a while.
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The word in DC is that Treasury Secretary Yellen will resign after the midterm elections. SEC Chairman Gary Gensler wants her job. In order to get it, he needs Senator Elizabeth Warren’s approval, and in order to get that, he needs to come down hard on crypto, which Warren hates. Thus the recent $1.26 million settlement with Kim Kardashian. There may be more pressure on the alt-coins, but bitcoin is too established for him to go after.
BTC-USD, ETH-USD, GBTC and ETHE are Strong Buys.
Primary Risk: Bitcoin falls due to over-regulation or is surpassed by another cryptocurrency.
Oil – $88.96
In spite of a full-court press by the Biden Administration, yesterday OPEC+ agreed to a two million barrels a day production cut to support the price of oil. The impact on actual production will be smaller because several members are already pumping far below their official quotas, meaning they could automatically be in compliance with their new limit without having to curb production. I make it about a one million barrels real cut.
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The biggest countries that are currently producing at or near quota are shouldering most of the burden. Also, note that this schedule goes to December 2023, although they could change it at any of the monthly meetings.
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Before the announcement, Kuppy wrote: “No one knows how big the cuts will be and frankly, it doesn’t matter how large they are. Instead, the message is clear – the Fed can crash global GDP in its fight against oil, but OPEC wields a much larger stick and will cut production even faster. In fact, OPEC will DO WHATEVER IT TAKES if the Fed continues on this path. OPEC has drawn a line under the price of oil and told the Fed that it’s wasting its time. OPEC controls the price of oil and oil is the world’s Central Banker, not the Fed.”
Just hours after the OPEC + announcement, President Biden said he would release 10 million more barrels of oil from the Strategic Petroleum Reserve in November in a move to counter raising gas prices again.
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That is likely too small to dent prices at the pump for long, but it’s large enough to P.O. the people he was just begging to increase production. I think it’s a mistake to get in an oil war with OPEC, but I’m not running energy policy in the US. Oil certainly is headed over $100 and probably towards $120 in the near term. Longer term, unless there is a dramatic change in the government and Larry Fink’s attitude towards fossil fuels, my $300 target in 2026 looks good. Got OIL?
The July 2026 Crude Oil Futures (CLN26.NYM – $53.16) are a Buy the under $55 for a $200+ target.
The iPath Pure Beta Crude Oil Exchange-Traded Note (OIL – $31.68) is a Buy under $36 for an $80+ target.
At the end of last year, overall fossil fuels represented 81% of energy consumption. 10 years ago, they were at 82%. In 10 years, $3.8 trillion of investment in renewables moved fossil fuels from 82% to 81% of the overall energy consumption. Meanwhile, the numbers needed for investment in renewable energy keep going up and up. BloombergNEF’s latest estimate for attaining net-zero emissions: by 2030 is $114 trillion. That’s not going to happen. Got uranium?
Energy Fuels (UUUU – $6.81) is a Buy under $8 for a $30 target.
Primary Risk: Uranium prices fall.
* * * * *
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* * * * *
Your getting educated on silver Editor,
Michael Murphy CFA
Founding Editor
New World Investor
All Recommendations
Check out the complete Portfolio page HERE.
Buys
These are the stocks everyone needs to own because transformative events are happening over the next year or two, and I expect to hold them long-term.
$20-for-$1
Aptose Biosciences (APTO – $0.59) – Buy under $2.50, ultimate target $30
Bellerophon Therapeutics (BLPH – $1.10) – Buy under $5, first target $30, then $100
Compass Pathways (CMPS – $11.66) – Buy under $20, hold a long time for a 10x return
Graphite Bio (GRPH – $3.35) – Buy under $9, hold a long time
Inovio (INO – $1.74) – Buy under $7, hold a long time
Invitae (NVTA – $2.68) – Buy under $10, first target $50, then $100+
Medicenna (MDNA – $0.86) – Buy under $3, first target $20, then maybe $40
ScyNexis (SCYX – $2.53) – Buy under $3, target price $20, then $50
Other Biotech
TG Therapeutics (TGTX – $6.15) – Buy under $7, target price $25+
Tech Dominators
Apple Computer (AAPL – $145.43) – Buy under $150 for new iPhones
Corning (GLW – $31.49) – Buy under $33, target price $60
Gilead Sciences (GILD – $64.95) – Buy under $70, target price $100
Meta (META – $139.07) – Buy under $250, target price $400
SoftBank (SFTBY – $18.70) – Buy under $25, target price $50
Other Tech
First Trust NASDAQ Cybersecurity ETF (CIBR – $40.73) – Buy under $40; 3- to 5-year hold
Fastly (FSLY – $9.39) – Buy under $20; 2- to 5-year hold to $80+
PagerDuty (PD – $24.71) – Buy under $30; 2- to 5-year hold
QuickLogic (QUIK – $6.40) – Buy under $10, target price $40
Rocket Lab (RKLB – $4.62) – Buy under $13, target price $30+
Velo3D (VLD – $4.51) – Buy under $6, target price $50
Inflation
A Short-Sale or REO House – ($447,000) – Buy while fixed mortgage rates are low
Bag of Junk Silver – ($20.64) – hold through silver bull market
Sprott Gold Miners ETF (SGDM – $22.57) – Buy under $28, target price $50
Sprott Junior Gold Miners ETF (SGDJ – $25.69) – Buy under $39, target price $100
Sprott Physical Gold and Silver Trust (CEF – $16.39) – Buy under $18, target price $30
Global X Silver Miners ETF (SIL – $26.31) – Buy under $30, target price $50
Coeur Mining (CDE – $3.81) – Buy under $5, target price $20
First Majestic Mining (AG – $8.99) – Buy under $11, next target price $23
Paramount Gold Nevada (PZG – $0.32) – Buy under $1, first target price $10
Sandstorm Gold (SAND – $5.22) – Buy under $10, target price $25
Sprott Inc. (SII – $35.48) – Buy under $40, target price $70
Cryptocurrencies
Bitcoin (BTC-USD – $20,052.75) – Buy
Grayscale Bitcoin Trust (GBTC – $11.95) – Buy
Ethereum (ETH-USD – $1,353.74) – Buy
Grayscale Ethereum Trust (ETHE – $9.41) – Buy
International & Other Recommendations
EMQQ Emerging Markets Internet & Ecommerce ETF (EMQQ – $28.04) – Buy under $38 for a $66 target in 12 to 18 months
KraneShares Bosera MSCI China A Share Fund (KBA – $31.67) – Buy under $40 for a three- to five-year hold
Morgan Stanley China A-Shares Fund (CAF – $14.15) – Buy under $18 for a three- to five-year hold
KraneShares CSI China Internet ETF (KWEB – $25.88) – Buy under $40 for a double over the next three years
Acreage Holdings (ACRDF – $1.24) – Buy under $2 for the Canopy Growth merger
Mongolia Growth Group (MNGGF – $1.16) – Buy under $1.30; long-term hold
Energy
Crude Oil Futures – July 2026 (CLN26.NYM – $53.16) – Buy under $55; $200+ target
iPath Pure Beta Crude Oil Exchange-Traded Note (OIL – $31.68) – Buy under $36; $80+ target
Energy Fuels (UUUU – $6.81) – Buy under $8; $30 target
Holds
These are holds but not sells – yet. They could get moved back to one of the buy categories if their prices drop or outlook improves, or they could become sell recommendations in the future.
Algernon Pharmaceuticals (AGNPF – $2.54) – Hold for IPF/chronic cough trial
Akebia Biotherapeutics (AKBA – $0.33) – Hold for FDA meeting
Arch Therapeutics (ARTH – $0.04) – Hold for buyout
Sell
Liberty Media Acquisition Corporation (LMACA – $9.95)
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Print This Post
Unread, but #1
Dear Michael, Do you have the results on the following votes (ARTH):
The company filed a proxy statement for the September 29 annual meeting. There are seven items:
1. Elect four directors – vote
2. Approve a reverse stock split of not less than 1-for-100 and not greater than 1-for-200 – vote
3. Approve an increase the number of authorized shares of common stock – vote
4. Approve, on an advisory basis, the compensation of Executive Officers – vote
5. Approve, on an advisory basis, how frequently stockholders believe we should conduct an advisory vote on the compensation of our Named Executive Officers – vote
6. Approve a proposal to grant discretionary authority to adjourn the Meeting, if necessary, to solicit additional proxies – vote
7. Ratify the appointment of Baker Tilly as independent auditors – vote
Thank you and GOD Bless you!
George
P.s. my may concern is the reverse split, hopefully, they voted against it!!
So mike, it is down until December but no short suggestions or puts? You are telling your readers to just take a beating for 2 months?
Also, no mention of Biden’s brilliant move to pardon federal prisoners for possession of weed and pressuring a move to reschedule? I guess positive Biden comments aren’t part of the agenda.
If I was a newb reading your letter, I would sell everything.
If you think that’s bad, the governor of Oregon has made hard drugs (coke, herion , and others basically legal. If someone is caught with a certain amount they just get a ticket. That means drug dealers are free to do their business as long as they don’t have large amounts on their person. Unbelievable!!
I don’t think possession is bad. Not sure what your point might be. If I can drink whiskey until I pass out and die, why can’t I do that with drugs? Personal responsibility.. right?
Drug dealers are not possessing it but selling it to kids and only those who have lost innocent kids to this , will know the pain.
and selling is and will stay illegal. let infocment focus on the suppliers not the end user.
Number of lives lost to weed overdose. Zero.
Perhaps no lives lost, but have you read what long term use can cause: depression, cognitive decline, paranoia, anxiety, impotency, – suffering all those I’d rather be dead!
LOL. I would suggest you educate yourself on weed. Did I step into the 1920s here?
Yes, exactly true. My brother was drafted during that crazy Asian war . He started smoking pot (that harmless recreational drug) in Vietnam. When he was released to inactive duty he had PTST and used POT increasingly for decades. At that time pesticides were used to increase production and not only was there risk of long term issues you also tossed the dice with pesticides. I finally convinced him to stop smoking that crap but after years of use he became increasingly more paranoid, extremely depressed and finally ended his life with a shotgun to his head. So yes, POT kills and I doubt he was the only one.
Michael, any witty comeback to this story?
Oh yes. One anecdotal story negates millions of data points.
Give me a break.
Only if they stop there. Moving up toward Chinese “F” they merely lose their minds and more.
that was my point to you, I’ve worked as a drug abuse counselor, saw the long-term effects of “weed” that many want to believe don’t exist so they can toke away, suggest you read up – by the ways another LT effect is aggressive personality and aggression, so you must be a toker!
Yeah, those pot heads are so aggressive. They will trample over you to get to the twinkies.
Again, give me a break.
@Michael
R U long calls on tsla?
im 1/19/24 @ 333.33
and 6/21/24 @300
No options, adding to TSLA on weakness. Like today.
drugs suck. but decriminalizing the users works (selling is still illegal)
there area lot of benefits for the local society, it save $, reduces crime, tacks pressure off healthcare, and more people that need treatment get it because they are no longer criminals instead there considered to be sick. and we reduce the funding going to the criminals that are supplying our country.
An obviously demented President is just reading what some anonymous member/scriptwriter of his administration is passing on so it is hard to say if it was actually his decision. On the face of it, certainly a positive step towards decriminalization.
Successful leaders put good advisors around them. Very refreshing contrast to the last administration.
You mean this administrations inability to identify inflation until long after it was runaway – that was good advisement?
The FED failed to identify inflation until long after it was runaway. The FED controls interest rates, not the president.
If there is an independent FED, not just an echo.
WRONG. The Dem president and congress initiate stupid massive greenie spending, cut oil production and more which kill the economy. The Fed is forced to react to this bad behavior, like a parent of an unruly child. The child is the problem, not the parent.
In case you didn’t notice, we had an epidemic that curtailed economic activity, and is still leading to lockdowns in China. Now that the economy is bouncing back, catch-up spending and inflation was expected. All those postponed weddings, vacations, business travel, college openings, etc. etc….wouldn’t that cause prices to rise in overbooked wedding venues, hotels, airplane fares, event tickets, rental cars, gas, etc??Supply chain chaos led to increased demand for goods that couldn’t be delivered, so prices for the limited supply led to inflation, which might be temporary. Lumber, semiconductor shortages, disrupted imports from China, heard about that? Or have you only heard about your least favorite politician getting a bill passed that you despise?
In case you didn’t notice, Russia invaded Ukraine, cut supplies of gas to Europe, negatively affecting grain exports, gas and oil prices, etc., etc. Worldwide there is a problem with inflation, not just in the US, and it started before this bill was signed. Do you know how cause and effect works? First there’s cause, then there’s the effect. Not effect first, then later in time there is the cause of the earlier effect.
Do you really think passing bills to start this so-called “green” spending caused all this inflation, when inflation was already in progress before the bill was signed into law?? Actually the vast majority of this spending is in the future, so how does this affect the present, when you think the present factors don’t affect the present?? The bill included health care items, putting caps on drug prices (leading to less interest in developing drugs?), which would be deflationary not inflationary. So that part of the bill is DEflationary, yes?? Did this bill directing the IRS to go after wealthy tax evaders cause inflation? You would complain that increased taxes or tax enforcement against those innocent rich tax evaders causes deflation because rich people have to pay taxes instead of buying stuff. That would lead to a reduction in economic activity and deflation, wouldn’t it??
This is a complex mess. Blaming inflation on one factor (Joe Bi’s bill for future spending) is a political statement that’s very simplistic, if not absurd.
Price controls don’t work. Bad Republicans like Nixon also failed at wage and price controls. Prices are set by market forces, not govt edicts. For example, say Pharma prices are mandated to be cut by 50%. So the company will cut their price of a 20 mg dose by 50% to make a 10 mg dose at that reduced price. To get the proper 20 mg dose, 2x as many 10 mg pills will be used, nullifying the price control.
I learned this lesson as a 6 year old child. My grandma repackaged my chocolate bar cut in half. I wanted the full amount of chocolate, so I ate twice as many half-bars.
Many politicians of both parties toss whatever economics they learned, for political expediency in their appeal to the masses who want quick fixes. Economics 101 which you should know–lowering prices below market by edict reduces supply, as companies shift production to more profitable items. Demand outstrips supply, forcing prices back up.
Economics 201–raising taxes puts that extra money in the hands of govt. If govt spending were as efficient and productive as private sector spending, the money supply and production would be the same, resulting in price stability. But private sector spending is disciplined by the fact that they cannot print money. However, the govt puts political pressure on the Fed to print tons more money for all the grandiose spending they do with money they never had or continually ran out of, evidenced by trillions of govt debt. The govt rarely has a balanced budget, so the debt keeps skyrocketing. No private company can sustain such fiscal irresponsibility for long.
Michael your unwavering defense of this liberal administration despite the bumbling they’ve done that caused all the economic harm, on top of your Trump derangement syndrome completely dilutes and discredits your opinion on politics. Biden crawling around the globe begging terrorist countries to produce more oil when we could have (and did) energy independence domestically is pathetic to watch – not only does it harm the environment more because its dirty oil, but it also enrichens and promotes more terrorism
The real “Trump derangement syndrome” is his big lie that he didn’t lose the 2020 election, by 7 million votes in the popular count and by the same margin he called a landslide when he won it in 2016. Or is it his followers belief that he is above the law with regard to inciting insurrection and stealing govt documents and raping and otherwise assaulting women? You tell me.
Wrong. It was obvious on election night 2020 that many Trump votes were switched by internet intervention of voting machines by saboteurs in the wee hours of the next morning. The corrupted courts wouldn’t hear the evidence, making excuses that Trump lawyers lacked “standing” whatever that is supposed to mean. The liberal mainstream media hides the truth–it is not to be trusted on most things except the weather.
If you deny court corruption, look at Dem efforts to expand the number of SCOTUS justices so they can pack the court with Dems. There is little unbiased justice anymore, but in its place there are court rulings based entirely on politics. I have more respect for manual laborers and car mechanics who perform their jobs objectively. Why? Because attempts to cheat the customer are immediately apparent and the customer either sues for damages or goes elsewhere for honest treatment.
The trump votes that were “switched” was obvious to everyone except the TRUMP APPOINTED JUDGES.
You people are really something.
Most Trump supporters are just uneducated and ignorant, and don’t understand logic, science, or evidence vs opinion. There is no excuse for an MD to believe those voting machine wacko stories. Courts don’t buy it and the perpetrators of those stupid voting machine conspiracy lies are getting sued for defamation successfully. Alex Jones and his BS hate site Infowars is another good example. Lawyers are not allowed to lie in court, but lying is okay in rightwing media.
It was McConnell who packed the Court, stealing one Justice from Obama and another from Biden. As for your belief in fraudulent voting where no court (out of 60) found any… do you still wear your tin hat and nightsuit to ward off 5G?
Leader?
Michael – didn’t you say a few times with confidence that OIL prices would collapse? Any change in that prediction?
Steve, ESG did that for oil. Hopefully the DRLL ETF will succeed in fighting the far left insertion into capitalism.This market today is a verification of recession in the context, from one of the Fed this morning of rate beating for up to a year.The real answer here for the Fed is to let the rates be determined by the markets directly., absent ESG, of course.
I didn’t see this opec cut but yes, oil will collapse as a recession engulfs the globe. I am long oil short term though. Also adding TSLA shares on weakness.
If the recession is mild, the oil price will drop somewhat, but not enough to negate MM’s bullish case for oil and other commodities such as uranium. Even if the recession is severe, oil is required for all power generation so planet humans can survive.
Take a look at the 2020 oil chart. That is where we are heading.
Decisions are the fathers of results.
With no more oil allowed, there is no more Bunker C oil, also known Blacktop, to put on our roads. That means cement covered roads, resulting in destruction for remaining fragile electric cars on the roads.
Ergo, the rich will walk together with the rest of us.
I won’t go into the shortage of electricity when the sun and wind.
Nobody is saying “no more oil allowed.”
Where do you get this idea?
I really think the right wants the world to end.
Michael couldn’t agree with you more,anymore conflict that the US gets involved in..the rest of this market will crash big time,that’s only my opinion..besides the picks from the new world investor
1600 Pennsylvania Ave. Washington D.C.
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When does the reverse split go into effect at ARCH. Is it liquid enough to trade in and out of at this time? Thanks MM
A question: Is there an exchange for it to be traded upon?
Good morning, all. Very impressive news about Arch Therapeutics, You know with the symbols ARTH. with that self-assembling peptide AC5 and spin offs that just got some honors. Might just pump some interest before that approved reverse split
Arch Therapeutics’ AC5® Advanced Wound System to be Presented with Honors at 2022 Symposium on Advanced Wound Care (SAWC) Fall (yahoo.com)
OK, positive news. However, first, the AC5 variants are classified as investigational, even though they work in reality. Very few doctors and hospitals will accept the liability in dealing with an investigational product. Suppose the patient has a bad outcome for other reasons. The corrupt legal community will seize on the fact that the AC5 variants are not approved and are only legally investigational. The bad outcome won’t be blamed on other factors with the patient, but it will be easier to blame the bad outcome on the investigational AC5.
Second, docs and hospitals deal with well established companies for product support. They won’t deal with ARTH even if AC5 is a superior product. The only viable outcome for ARTH is a buyout by an established company, but at what price? 10 cents? Or a firesafe price after ARTH goes bankrupt? The big company has good business with their established products, and there is no standard of care saying that AC5 is that standard, so the big company can afford to wait as long as necessary to pick up AC5 for small pennies. TN has played this cat and mouse game and is losing and will continue to lose.
Disaster is the word. The economic data a few minutes ago gives us a major league 8.2%+. Market tanks. What will the feds do? Unless our national leaders decide to open up our energy market and production, we might as well be looking at recession and maybe deflation or whatever. The 10 year is now 4.02% Dow Jones down 510 or so Not looking good. Social security might see a 8.7% increase? HMMM Is there a pony in there somewhere? @Michael Murphy you have a real RADAR task tonight. Good luck to you and GLTA
Right. I am surprised that part B Medicare premiums will decrease for 2023. Usually insurance premiums increase as more people try to take advantage of services. I suspect that Medicare is succeeding at denying benefits for services. I see these wholesale denials every day, based on nothing except categorical slashing and ignoring letters of medical necessity.
Interesting talking point but the fact is that oil production is UP.
https://www.eia.gov/outlooks/steo/report/us_oil.php#:~:text=U.S.%20crude%20oil%20production%20in,record%20high%20set%20in%202019.
Rig count is also up.
https://ycharts.com/indicators/us_rotary_rigs#:~:text=US%20Rig%20Count%20is%20at,44.32%25%20from%20one%20year%20ago.
Maybe big oil is gouging and people are too slow to understand?
Been buying the dips on QID all year. 2022 is looking pretty good so far.
The Radar Report for 10.13.22 is posted.