+ Is inflation ebbing or escalating?
+ Are consumers flush with covid money, or have they spent it all and are now broke?
+ Are we going back to the office, for all or some?
+ Why are the big tech companies laying off thousands, when everyone else is hiring?
+ Can you make more money shorting or going long?
+ Why are high price stocks like Tesla and Nvidia flying when “value” stocks are ebbing?
+ Are short-term treasuries — six to 12 month — a good “hiding place” from the uncertainty, or will equities roar back in the second half when the Fed starts slicing (?) interest rates?
+ Do I really need all that food? Or is eating easier than thinking?
The New Yorker has a piece:
It’s O.K. to Be Confused About This Economy
Even the experts don’t really know where inflation and jobs are headed.
…In the course of the past three years, the economy has been hit by three huge shocks: the coronavirus pandemic; an energy-price spike caused by the war in Ukraine; and, most recently, the sharpest rise in Fed interest rates in forty years. In the wake of these tumultuous events, it is hardly surprising that some long-standing economic relationships appear to have broken down, leaving even the experts confounded, and pointing to a cautious policy approach as the appropriate one. …
What is the takeaway from all of this? First, beware anyone who claims to know exactly where the economy is heading. Second, have a bit of sympathy for Powell, Jefferson, and their colleagues at the Fed. Another speaker at Friday’s conference was Mervyn King, a former chair of the Bank of England. After delivering his own analysis of where the inflation surge came from and how it might be resolved, King conceded, “I wouldn’t want to give advice to any central banks about what we should do.”
The New Yorker piece is here.
My advice remains the same:
+ Keep more cash around than you usually do.
+ Hide in treasuries.
+ A modicum of stocks make sense. I’ve done well recently with Tesla, Nvidia, Meta and shorting Intel. But energy, defense and fintech/banks (which I thought were sure things) are lagging.
+ Keep an eye out for bargains in real estate, also called distress. Don’t be frustrated if you don’t find any. Banks are flush and can afford to hold their disasters a little longer.
+ Don’t buy Penn tennis balls. They’re awful.
It happened at a New York Airport
A crowded United Airlines flight was canceled. A single agent was re-booking a long line of unhappy travelers.
Suddenly, an angry passenger pushed his way to the desk. He slapped his ticket on the counter and said, “I HAVE to be on this flight and it has to be FIRST CLASS.”
The agent replied, “I’m sorry, sir. I’ll be happy to try to help you, but I’ve got to help these folks first; and then I’m sure we’ll be able to work something out.”
The passenger was unimpressed. He asked loudly, so that the passengers behind him could hear, “DO YOU HAVE ANY IDEA WHO I AM?”
Without hesitating, the agent smiled and grabbed her public address microphone. “May I have your attention, please?”, she began, her voice heard clearly throughout the terminal. “We have a passenger here at Gate 14 WHO DOES NOT KNOW WHO HE IS. If anyone can help him with his identity, please come to Gate 14”.
With the folks behind him in line laughing hysterically, the man glared at the United Airlines agent, gritted his teeth, and said, “F*** You!”
Without flinching, she smiled and said, “I’m sorry sir, you’ll have to get in line for that, too.”
Favorite cartoons
My schedule
I played tennis at 7:00 AM this morning in the California desert of the Coachella Valley. It was gorgeous. No wind. Blue sky. Mid-fifties temperatures. Perfect.
The desert is crawling with Canadians escaping their below-freezing temperatures and their lack of sun. They’re our neighbors. I wonder why the Russians couldn’t figure that out with Crimea. It was a nice place to visit.
La Quinta is shopping heaven. It’s got Traders Joes, Whole Foods, bakeries that bake their own baguettes, fish from the farms down the road and the largest collection of supermarket prepared foods.
Spectrum is providing me download Internet speed of 550 megabits per second. What’s not to like? — Harry Newton
