The Leyendecker View: The GameStop War is Raging«Back


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The Leyendecker View: January 29, 2021


If you want to do a good deed, do it now. 
The time will pass, and you will not have the chance again. 
Leo Tolstoy in A Calendar of Wisdom

 
SOMETHING NEW…FOR YOUR MEMORY
 
According to my calculation from the Bureau of Labor Statistics data, in January of 1980 we had 2.64 service-providing jobs for every one goods-producing job. In 1990, we had 3.61 service-providing jobs for every one goods-producing job. And just prior to the pandemic lockdowns, we had 6.16 service-providing jobs for every one goods-producing job. According to the Federal Reserve Bank of St. Louis, in 1980 total public debt as a percent of GDP equaled about 31%. Today, total public debt as a percent of GDP is about 125% and growing rapidly. The US now has a debt level that rivals Italy’s. 
 
So, how is the transition from a goods-producing to a service-providing economy working out in this country? Goodie good? Whatcha think?
 
GOOD READER INPUT
 
An astute reader, Mark Wargo, lobbed over a question: “What was the ratio of service-providing jobs to one goods-producing job when the US last had a balanced budget?” 
 
The federal budget was last balanced or in surplus in 1998, 1999, 2000 and 2001. The ratio of service-providing jobs to one goods-producing job during those years was 4.18, 4.28, 4.35 and 4.53 respectively. For those old enough to remember, during this period of time pretty much every PC and cell phone (and a whole lot of other stuff) was manufactured in the US. 
 
This likely isn’t the sort of “math” a PhD in economics would do—way too simple for a dissertation. But then maybe that’s why our economic policy seems to keep missing it. How about we have a goal of moving the current ratio of 6.16 service-providing workers for every one goods-producing worker down to 4.3 or even 4.5? Baby steps, or would this lead to the destruction of Starbucks?
 
THE ECONOMIC VIEW

Metro home prices rise in every market
As existing-home sales hit 14-year record
While apartment owners face a rent squeeze
 
States are lifting restrictions
California lifts stay-at-home orders
Let’s hope mutant strains don’t show up.

US economy shrank in 2020
Duh…
 
Biden signs order to buy American
Devil will be in the details—and execution.
 
LABOR VIEW
 
Jobs grow in the South
While rest of the US struggles
 
COVID job losses
Four times as many as the 2009 global financial crisis.
 
The future of work
According to McKinsey.
 
MEANWHILE IN EUROPE
 
Vaccine shortages hit E.U.
Late 2021 recovery isn’t baked in.
 
Eurozone PMI in contraction
New virus strain could wallop them more.
 
Parliament condemns China over HK crackdown
Are these just empty words to save face?
 
THE GLOBE
                         
Economic sentiment declining since December
In many parts of the world.
 
Unrest in Russia
Protests in support of Putin opposition leader.
 
Iran must return to nuclear deal
Before Biden administration will. 
 
Xi wows them with Davos virtual speech
While he sends warplanes near Taiwan
 
THE FINANCE WORLD
                
Hedge funds getting torched
The GameStop war is raging, where next?
It’s rage against traditional Wall Street
 
An open letter to CNBC and hedge funds
From a GameStop investor. WOW!!!
We’re in a “meme stock” bubble
 
Goldman unsure about SPACs
Last year’s froth is only getting frothier.
 
CORONANEWS
 
South African strain has hit the U.S.
In South Carolina.
While one vaccine is far less effective on it
 
The AstraZeneca cluster
EU not happy with shortfall.
Germany says not for over 65 crowd
 
Moderna vaccine less potent
But still protective against virus variant.
 
TECHNOLOGY
 
Tech execs suggest bifurcation with China
Bipartisan support growing.
 
Tesla has first full year of profitability
But global competition is coming on fast.
 
Tech giants ramp up lobbying spend
In order to keep their billions and zillions.
 
THE WAR ON CARBON
 
EIA forecasts less gas and more coal this year
For power generation.
 
Who believes in the climate emergency?
Almost exclusively the developed world.
 
Cobalt prices soaring with EV surge
Is traditional mining carbon friendly?
 
THE CHINA SYNDROME
                        
Independence means war
China throws down the gauntlet to Taiwan.
 
US carrier group enters South China Sea
Same day as China strike group entered area.
 
China not living up to its trade agreement
Woefully short on their commitment.
 
THE NEXT NORMAL
 
How nothingness became what we wanted
We’re bombarded with too much of too much.
 
Only liars speak openly
The speech police are turning us into liars.
 
The blue wave’s green goal
Will it waste money, or transform our world?
 
MAKING A BETTER YOU
                         
Negotiating your next job
Put salary at the back of the line.
 
How to be a genius
Why not give it a try?
 
Go for a regular walk
You’ll add years to your life. 
 
HOW ABOUT A BREAK
 
Drug reverses mental decline
Lost cognitive ability may not be permanent.
 
How meditation can help the world
And not just you.
 
Pets rule these days
Animal shelters running out.
 
MINDCATION VIDEOS OF THE WEEK
 
Skateboarding with director Werner Herzog
An old guy gets the failure it takes to get good.
 
The Sundance Film Festival
Buy tickets, watch virtually.
 
The UK explained
Untangling the country of countries.
 
FROM THE HEADHUNTER’S KITCHEN
 
It’s still winter…more comfort food please!
 
Perfect roast chicken
The French way.
 
Perfect mashed potatoes
There’s not much more comforting.
 
Apple Whiskey Pandowdy
Pie like no other pie.
 
Best way to wash cast iron
 
THOUGHTS FROM DOUG
 
The only thing certain in the world today seems to be uncertainty.  
 
It’s starting to feel like virus mutations are going to outpace the vaccines.
 
Is Davos where the global elite go to organize our future prosperity, or is it where they go to organize their own future prosperity?
 
If you haven’t watched The Queens Gambit, then you may be missing a glimpse into the future of fashion. The 60s may be the next fashion fad. (It’s a great show, too!)
 
Generally, when there is a lot of talk about a stock market bubble, it’s not yet reached the bursting point. That point tends to come when everyone has decided we’re in a new paradigm. But then as they say in the investing world…past results are no guarantee of future performance.
 
What country around the world wants to be compared to “the land of opportunity”? How can other countries best that benchmark? Maybe this is why the world seems to want the US to stumble…as often as possible. That is, of course until the day they need us to save them from some bad actor.
 
IN CASE YOU MISSED IT
 
The Leyendecker View: Visualizing 150 Years of US Labor
January 22, 2021
 
The Leyendecker View: PE Grabs the Cash
January 15, 2021
 


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