Sept 17
Separation of powers and balance of powers among the three branches of government are the bedrock of our Constitution. The New York Times by its attacks on the Supreme Court clearly wants to destroy the Constitution and create a far left dictatorship. @JamesY54939
Markets and Stocks
It does not matter whether the Fed cuts by 25 bps or 50 basis points; what matters is the outlook for economic growth and earnings. When the Fed is cutting rates and the economy is growing, invariably the market goes higher. Today, the economy is growing at 2.5% or so. Projections are for reasonable growth over the next 12 months. So, the backdrop for equities is very positive.
Inflation is falling. The Fed will be cutting. Earnings will be rising and the economy is growing. I repeat the outlook for equities is very positive.
My six month target for the S&P 500 is 6,000.
I like Micron. It plans to triple its share of the high bandwidth memory market over the next few years.
The stock is selling at 9x. I believe that it is under valued by 50% or more.
I like Apple. Next year when all the bells and whistles of AI are integrated into Apple phones, the stock should be trading closer to $300 than $200. I believe Apple is a pound the table buy right here.
ARM Holdings is a great investment for patient investors. The stock is expensive, but it is a winner.
Will Boeing file for bankruptcy or issue new equity and dilute existing shareholders?
The residential housing market and related equities should enjoy bumper profits over the next 12 months. The rate on 30 year mortgages is approaching 6% and mortgage rates should fall toward 5% in 2025.
Gold continues to soar because investors worry about the long term trajectory of the deficit.
But the gold trade is very crowded.
Micron is set to benefit from accelerating spending on AI products, including high-bandwidth memory solutions.
An escalating shipment ramp of HBM3E memory solutions could yield a strong margin picture for Micron at the end of the month.
The EPS revision trend for Micron is highly favorable ahead of the Q4'24 earnings report date on September 25, 2024.
Micron's shares trade at an attractive P/E ratio of 7.0X, well below the industry average, presenting a compelling investment opportunity ahead of earnings.
I continue to like Rolls Royce.
On September 27, the core PCE inflation rate should be consistent with the Fed’s 2% target.
@NickTimiraos Here's the full table of 15 shops that translate the CPI and PPI into the PCE:
They have core at 0.15% in August (1.8% annualized)
This would lead the 12-month rate to tick up to 2.7%
The 6-month annualized rate would fall to 2.4%
12-month headline is seen dropping to 2.3%
https://x.com/nicktimiraos/status/1835302557087842459?s=66&t=hi3LjJ8kVbN50WgSIEfnAg
Argentina, the world’s biggest exporter of processed soybean meal and oil, is set to bring in whole beans from the US for the first since 2019 as declining American prices make them the cheapest in the world.
The South American nation has purchased 88,400 metric tons of beans to be shipped during the current season, according to the US Department of Agriculture. The move comes as the harvest of a record US crop was getting underway.
“It surprised the hell out of me,” said John Baize, an independent analyst who also advises the US Soybean Export Council.
US shipments from New Orleans in October, for example, were about $395 per ton on a free-on-board basis, about $16 per ton cheaper than Argentina’s soy, according to Commodity3 data.
India offers attractive investment opportunities for long term investors, who are risk tolerant.
Over 17% of the world’s population lives in India. India is poised to become the world’s third-largest economy by 2030 (its GDP stands at $3.94 trillion and is expected to hit $10 trillion by 2035). Its economic growth has stayed around 7 percent per year for the last decade, and it promises to remain robust in the future. See Marginal Revolution.