Economy:
The BLS estimated that nonfarm payrolls declined by 20.5 million in April, with the unemployment rate rising to 14.7%. Employment Situation Summary
The U-6 number increased to 22.8%. Table A-15. Alternative measures of labor underutilization
Coronavirus: Trump shrugs off the brutal jobs report, focuses on Flynn
Trump Says 20 Million Jobs Lost to COVID-19 'Will Be Back Very Soon'
No 'V'-shape return from devastating U.S. job loss, Fed policymakers say - Reuters
ADP estimated that 20,236,000 private sector jobs were lost in April. ADP National Employment Report | April 2020 The total number of job losses last month was more than double the total lost during the Near Depression. ADP private payrolls April 2020 drop by record 20.2 million
US weekly jobless claims total 3.169 million, seven-week tally hits 33.5 million (5/7/20); News Release DOL (the advanced seasonally adjusted insured unemployment rate was 15.1% for the week ending 4/25)
The BLS estimated that nonfarm payrolls declined by 20.5 million in April, with the unemployment rate rising to 14.7%. Employment Situation Summary
The U-6 number increased to 22.8%. Table A-15. Alternative measures of labor underutilization
Trump Says 20 Million Jobs Lost to COVID-19 'Will Be Back Very Soon'
No 'V'-shape return from devastating U.S. job loss, Fed policymakers say - Reuters
ADP estimated that 20,236,000 private sector jobs were lost in April. ADP National Employment Report | April 2020 The total number of job losses last month was more than double the total lost during the Near Depression. ADP private payrolls April 2020 drop by record 20.2 million
US weekly jobless claims total 3.169 million, seven-week tally hits 33.5 million (5/7/20); News Release DOL (the advanced seasonally adjusted insured unemployment rate was 15.1% for the week ending 4/25)
US services sector posts biggest contraction since 2009 as coronavirus halts economic activity The April ISM services PMI declined to 41.8 in March from 52.5 in March. This represents the first contraction in 122 months. The new orders component plunged to 32.9%, down 20 points from March's 52.9%. The employment component fell to 30%. ISM - ISM Report - April 2020 Manufacturing ISM® Report On Business®
Consumer debt hits new record of $14.3 trillion
The coronavirus economy is exposing how easy it is to fall from the middle class into poverty
Consumer debt hits new record of $14.3 trillion
The coronavirus economy is exposing how easy it is to fall from the middle class into poverty
EU's Spring 2020 Economic Forecast (the EU estimates a 7.5% decline in the 2020 European GDP and a rebound in 2021, noting, however, that the "risks surrounding this forecast are also exceptionally large and concentrated on the downside."
China reports April 2020 trade data as coronavirus outbreak eases (exports up 3.5% vs. consensus estimate of -15.7%) I mentioned in previous posts and comments that I expected Asia's economies to come back before Europe and the U.S.
China reports April 2020 trade data as coronavirus outbreak eases (exports up 3.5% vs. consensus estimate of -15.7%) I mentioned in previous posts and comments that I expected Asia's economies to come back before Europe and the U.S.
+++++++
Markets and Market Commentary:
Last week confirmed that the Stock Jocks, who are now controlling the stock market's direction (many with a contrary opinion or lacking enthusiasm), view the pandemic as a temporary interruption in U.S. GDP growth.
While stock pricing in some sectors are consistent with non-temporary damages to business enterprises, the current stock prices in other sectors are basically ignoring what has happened this year as well as the bad news that is virtually certain to occur over the next several months.
Many of the large capitalization stocks powering the surge off the March lows are technology companies. An example is Microsoft.
Other large cap companies, viewed as beneficiaries of the shutdowns, are higher now than they were in February. Examples include Amazon.com, Inc. and Netflix, Inc.
Stock prices for several large cap pharmaceutical stocks have returned to mid-February prices. An example is Amgen Inc.
The regional bank stock prices are not consistent with the Blue Sky dead ahead consensus opinion that is driving SPX and the Nasdaq up. SPDR S&P Regional Banking ETF 1 Year Chart The point is that only a few stock sectors share the bullish enthusiasm about the near future. Those sectors are important to the Stock Jocks and are capable of lifting the market provided there is not too much drag and dead weight to lift.
Jeremy Siegel: March coronavirus swoon in stocks 'definitely going to be the low'
Stocks are up against big 'resistance' and likely need actual economic improvement to overcome it (5/2/20)
Banks are facing huge credit losses as their customers suffer through the coronavirus pandemic, S&P warns - MarketWatch
Last week confirmed that the Stock Jocks, who are now controlling the stock market's direction (many with a contrary opinion or lacking enthusiasm), view the pandemic as a temporary interruption in U.S. GDP growth.
While stock pricing in some sectors are consistent with non-temporary damages to business enterprises, the current stock prices in other sectors are basically ignoring what has happened this year as well as the bad news that is virtually certain to occur over the next several months.
Many of the large capitalization stocks powering the surge off the March lows are technology companies. An example is Microsoft.
Other large cap companies, viewed as beneficiaries of the shutdowns, are higher now than they were in February. Examples include Amazon.com, Inc. and Netflix, Inc.
Stock prices for several large cap pharmaceutical stocks have returned to mid-February prices. An example is Amgen Inc.
The regional bank stock prices are not consistent with the Blue Sky dead ahead consensus opinion that is driving SPX and the Nasdaq up. SPDR S&P Regional Banking ETF 1 Year Chart The point is that only a few stock sectors share the bullish enthusiasm about the near future. Those sectors are important to the Stock Jocks and are capable of lifting the market provided there is not too much drag and dead weight to lift.
Jeremy Siegel: March coronavirus swoon in stocks 'definitely going to be the low'
Stocks are up against big 'resistance' and likely need actual economic improvement to overcome it (5/2/20)
Banks are facing huge credit losses as their customers suffer through the coronavirus pandemic, S&P warns - MarketWatch
The coming Greater Depression of the 2020s - MarketWatch (article written by the economist Nouriel Roubini who gained some notoriety after predicting in 2006 the housing price collapse, see, e.g. Q&A With Real-Estate Pessimist and NYU Economist Nouriel Roubini -- New York Magazine 9/22/2006) I would generally agree with the points that Roubini is making provided the time frame is over the next ten years. As to his points about currency debasement and de-globalization, I would view those events as causing inflationary pressures and a rise in interest rates, notwithstanding the FED's effort to control longer term rates through massive QE interventions. Near perpetual QE will be viewed by almost everyone as debt monetization and currency debasement in a few years.
GE Aviation plans to cut its global workforce by 25% this year as coronavirus hurts travel
Starbucks credit downgraded to 2 notches above 'junk' at Fitch, outlook is negative - MarketWatch; Fitch Downgrades Starbucks to 'BBB'; Outlook Negative
Tenet Healthcare (THC) earnings Q1 2020 (warns that hospital admissions started to fall sharply in mid-March as patients deferred discretionary healthcare procedures)
Disney earnings plummet-MarketWatch; Disney (DIS) Q2 2020 earnings
Norwegian Cruise Line says there's 'substantial doubt' about its ability to continue as a 'going concern'
Total Q1 earnings: Oil major's net profit falls 35% in the first quarterTotal: First Quarter 2020 Results
Suncor swings to $3.5B Q1 GAAP loss, slashes dividend and capex (NYSE:SU) | Seeking Alpha; Suncor Energy reports first quarter 2020 results
GrafTech International slashes dividend by 88% (NYSE:EAF) | Seeking Alpha; GrafTech Reports First Quarter 2020 Results
WestRock cuts dividend (NYSE:WRK) | Seeking Alpha; WestRock Reports Fiscal 2020 Second Quarter Results
Marriott Vacations provides upbeat profit outlook, but is furloughing 65% of staff and suspending dividend - MarketWatch
Covanta Cuts Dividend & Withdraws View Amid Coronavirus Woes-Zacks.com
Saratoga Investment defers dividend; shares drop 11% (NYSE:SAR) | Seeking Alpha The external manager did not defer payment of their excessively generous compensation. I thought the deferral of the common share stock dividend was just disgusting under the circumstances. SAR's external manager claimed that adjusted NII was $.61 per share. However, most of that adjusted number was taken by the external managers in an "incentive fee" of $6.862+M taken in cash during the quarter. The external manager was lucky in an investment that produced during the quarter a $31.2M gain, offset in part by a realized loss of $.9M in another investment. The net realized gain in the quarter was $30.3M. The BDC claimed a net asset value per share of $27.12 as of 2/29/20. The stock closed at $13.25 last Friday, indicating IMO that investors do not believe in the NAV per share claim (see page 18 of transcript e.g.). Saratoga Investment Corp (SAR) CEO Christian Oberbeck on Q4 2020 Results - Earnings Call Transcript | Seeking Alpha (p.2 "we are proud of our five-year record of consecutive increases in dividends."; effort made by CEO to explain dividend deferral at pages 14-15; note that external managers earn a base management fee on assets, and no firm commitment is given to whether dividends will be paid before the F/Y year ends next February)
THL Credit cuts dividend by ~52% (NASDAQ:TCRD) | Seeking Alpha; THL Credit Reports First Quarter 2020 Financial Results and Declares Dividend of $0.10 Per Share (THL Credit is a poorly managed BDC and is deservedly hated by investors; net asset value per share was reported at $5.22, down from $7.64 on 12/31/19; NII was reported at 9 cents per share, down from $.21 in the 2019 first quarter).
Independence Realty Trust Announces First Quarter 2020 Financial Results (IRT slashed its quarterly dividend from $.18 per share to $.12, 33.33% decrease)
EPR Properties falls 4.9% after suspending dividend, buyback (NYSE:EPR) | Seeking Alpha; EPR Properties Reports First Quarter 2020 Results This was inevitable for this REIT as I previously discussed. Item # 3.B. (5/2/20 Post) and Item # 2.A. (3/14/20 Post)
Starbucks credit downgraded to 2 notches above 'junk' at Fitch, outlook is negative - MarketWatch; Fitch Downgrades Starbucks to 'BBB'; Outlook Negative
Tenet Healthcare (THC) earnings Q1 2020 (warns that hospital admissions started to fall sharply in mid-March as patients deferred discretionary healthcare procedures)
Disney earnings plummet-MarketWatch; Disney (DIS) Q2 2020 earnings
Norwegian Cruise Line says there's 'substantial doubt' about its ability to continue as a 'going concern'
Total Q1 earnings: Oil major's net profit falls 35% in the first quarterTotal: First Quarter 2020 Results
Suncor swings to $3.5B Q1 GAAP loss, slashes dividend and capex (NYSE:SU) | Seeking Alpha; Suncor Energy reports first quarter 2020 results
GrafTech International slashes dividend by 88% (NYSE:EAF) | Seeking Alpha; GrafTech Reports First Quarter 2020 Results
WestRock cuts dividend (NYSE:WRK) | Seeking Alpha; WestRock Reports Fiscal 2020 Second Quarter Results
Marriott Vacations provides upbeat profit outlook, but is furloughing 65% of staff and suspending dividend - MarketWatch
Covanta Cuts Dividend & Withdraws View Amid Coronavirus Woes-Zacks.com
Saratoga Investment defers dividend; shares drop 11% (NYSE:SAR) | Seeking Alpha The external manager did not defer payment of their excessively generous compensation. I thought the deferral of the common share stock dividend was just disgusting under the circumstances. SAR's external manager claimed that adjusted NII was $.61 per share. However, most of that adjusted number was taken by the external managers in an "incentive fee" of $6.862+M taken in cash during the quarter. The external manager was lucky in an investment that produced during the quarter a $31.2M gain, offset in part by a realized loss of $.9M in another investment. The net realized gain in the quarter was $30.3M. The BDC claimed a net asset value per share of $27.12 as of 2/29/20. The stock closed at $13.25 last Friday, indicating IMO that investors do not believe in the NAV per share claim (see page 18 of transcript e.g.). Saratoga Investment Corp (SAR) CEO Christian Oberbeck on Q4 2020 Results - Earnings Call Transcript | Seeking Alpha (p.2 "we are proud of our five-year record of consecutive increases in dividends."; effort made by CEO to explain dividend deferral at pages 14-15; note that external managers earn a base management fee on assets, and no firm commitment is given to whether dividends will be paid before the F/Y year ends next February)
THL Credit cuts dividend by ~52% (NASDAQ:TCRD) | Seeking Alpha; THL Credit Reports First Quarter 2020 Financial Results and Declares Dividend of $0.10 Per Share (THL Credit is a poorly managed BDC and is deservedly hated by investors; net asset value per share was reported at $5.22, down from $7.64 on 12/31/19; NII was reported at 9 cents per share, down from $.21 in the 2019 first quarter).
Independence Realty Trust Announces First Quarter 2020 Financial Results (IRT slashed its quarterly dividend from $.18 per share to $.12, 33.33% decrease)
EPR Properties falls 4.9% after suspending dividend, buyback (NYSE:EPR) | Seeking Alpha; EPR Properties Reports First Quarter 2020 Results This was inevitable for this REIT as I previously discussed. Item # 3.B. (5/2/20 Post) and Item # 2.A. (3/14/20 Post)
Tripadvisor swings to loss, cuts 23% of workforce - MarketWatch
Invesco halves dividend to $0.155 (NYSE:IVZ) | Seeking Alpha
Invesco halves dividend to $0.155 (NYSE:IVZ) | Seeking Alpha
+++++
Trump:
As Deaths In U.S. Continue, A Look At Trump's Words On Virus-YouTube
Doctor Don's and Fox "News" Miracle Drug For Covid-19:
Hydroxychloroquine is Doctor Don's much touted "miracle cure" for Covid-19 infections.
In fairness to Doctor Don, M.D. in B.S., hydroxychloroquine has not yet been conclusively proven IMO to have no benefit when given to COVID-19 patients.
The reliable evidence so far, as noted below, is that this "miracle drug" does not have any scientifically observed benefit, and there is evidence that some patients are seriously harmed by it.
The point to keep in mind is that Donald and his Fox News sycophants were touting this drug based on no scientifically reliable trials.
Hydroxychloroquine fails to help hospitalized coronavirus patients in US funded study The results for this study, financed by the U.S. government's National Institute of Health, was published in the last Thursday in the New England Journal of Medicine.
These articles discuss the results of a study conducted by the Veterans Administration. Covid-19: VA Study Points to Increased Mortality with Hydroxychloroquine-Physician's Weekly; Hydroxychloroquine Ineffective for COVID-19, VA Study Suggests
It is a miracle that the Teflon Don pays no political price for spreading fact free B.S. Fox News Goes Radio Silent on Trump’s Coronavirus Miracle Drug-Vanity Fair; Fox News mentions of hydroxychloroquine have significantly dropped off-Media Matters for America
Fox news personalities, including Laura Ingraham, Tucker Carlson and Sean Hannity, repeatedly touted the drug, as part of their mindless defense of anything that comes out of Trump's mouth, and they lambasted scientists and other media organizations who repeatedly made fact based observations about this drug.
Fox News has promoted hydroxychloroquine nearly 300 times in a two-week period-Media Matters for America;
Why Did Fox News's Laura Ingraham Relentlessly Push Hydroxychloroquine?-GQ
Fox News Stars Trumpeted a Malaria Drug, Until They Didn’t - The New York Times
Hydroxychloroquine truther Laura Ingraham attempts to discredit promising new coronavirus treatment-Salon.com;
From Fox News, a big dose of dumb on hydroxychloroquine-The Washington Post
What Trump and Fox News hosts said about hydroxychloroquine; Tucker Carlson: Why are media pundits trying to discredit hydroxychloroquine? - YouTube
++
Donald's Political Considerations Deep Six CDC Guidelines to Protect Worker Health:
AP Exclusive: Top White House officials buried CDC report
Trump administration shelves CDC guide to reopening country: AP - MarketWatch;
AP Exclusive: US shelves detailed guide to reopening country
White House Blocks C.D.C. Guidance
The CDC was reportedly told by the Trump Administration that the guidelines would never see the light of day. That resulted in a leak of the CDC guidelines the news media. White House is reviewing detailed guidance for gradual reopening-The Washington Post (copy of guidelines linked) In responding to the AP story, a WH official claimed the guidelines were "overly specific" on how employers could protect employees, which is an acknowledgment that Trump tried to deep six them.
Trump tightens grip on coronavirus information as he pushes to restart the economy
This is just another example of political considerations overriding health recommendations made by experts.
+++
Donald Will Drain the D.C. Swamp Very Soon:
Virus Whistle-Blower Says Trump Administration Steered Contracts to Cronies
Kushner COVID-19 team prioritized PPE bids from Trump associates: NYT - Business Insider
Donald will start to drain the D.C. swamp "very soon".
He will start that process by resigning "very soon". Tracking President Trump's Unprecedented Conflicts of Interest - CREW
+++
Trump's Decision to Reopen the Economy without adequate testing and contact tracing in place:
34 days of pandemic: Inside Trump’s desperate attempts to reopen America Worth reading.
Trump says it’s safe to reopen states as governors grapple with loosening restrictions He also said that he expected deaths to hit 80,000-90,000 possibly as high as 100,000, up from his previous estimate of 65K. Trump claims Lincoln got better press treatment as he ups Covid-19 death estimate He revised his previous estimate of 65,000 when the death count was 67+K.
After much study and deep reflection, Doctor Don has concluded that testing for COVID-19 is overrated since the person may become infected after the test. Trump says tests are 'overrated,'; Trump plays down coronavirus testing as U.S. falls far short of level scientists say is needed - The Washington Post
Doofus Don's conclusion about testing is not shared by anyone who actually knows what they are talking about.
To slow down the infection rate, it is important to identify those who are asymptomatic but capable of infecting others. Those who are infected would then go into a 14 day quarantine and their known contacts would then be traced, contacted and tested. Any contact who has become infected would be isolated for 14 days and so on.
The goal is to prevent an out-of-control pandemic and to to shut down as quickly as possible emerging hot spots.
The other reasons include identifying those persons who have developed antibodies after becoming infected and may be immune to further infections. There are a variety of reasons for having that information.
Another reason for testing is to learn more about this infectious disease including its true mortality and serious illness rates as a percentage of the total number of infections.
Trump to ABC's Muir: 'It's possible there will be some' deaths as country reopens
Trump Administration Models Predict Near Doubling of Daily Death Toll by June
A mutant coronavirus has emerged, even more contagious than the original, Los Alamos National Lab study says
Trump cheers on governors even as they ignore White House coronavirus guidelines in race to reopen
Coronavirus may last 2 years, study warns. And its second wave could be worse. The second wave of the Spanish Flu was far worse than the first wave and occurred after the virus had mutated to a more dangerous form. Why the Second Wave of the 1918 Spanish Flu Was So Deadly - HISTORY
US is unprepared to protect residents from virus while states are reopening, former acting CDC director says
US lurches toward reopening despite ominous coronavirus models; COVID-19 Model IMHE
+++++
Don the Authoritarian Fires another Inspector General for Doing their Job:
Coronavirus: Trump looks to replace HHS Inspector General Christi Grimm who reported supply shortages; Trump seeks to replace HHS watchdog who reported hospital shortages | TheHill The HHS IG simply reported the results of a survey conducted by HHS. Trump blasts HHS watchdog for report on hospital shortages - POLITICO
Since the results did not please Don the Authoritarian, she had had to be replaced with someone who knows better than to report facts that Donald does not like. Trump decries IG report on hospital shortages as 'another fake dossier' | TheHill
Trump replaces Christi Grimm, HHS watchdog who found shortages in coronavirus testing, supplies at hospitals - The Washington Post
The message that Don the Authoritarian clearly sends to every federal employe is to do nothing that undermines his reality creations.
Donald has proven beyond any doubt that lying about everything works on at least one half of Americans, so it is important for Trump to fire anyone who is just doing their job publishing a routine report that rebuts Donald's reality creations.
Donald Is Incapable of Telling the Truth:
Lying all of the time and misleading the public on matters of national interest are just two of Donald's "conservative" virtues
One of the lies that Lying Don will continue to propagate repeatedly is his claim that he banned travel from China on 1/31/20. Trump imposed restrictions. Almost 40K individuals travelled from China to the U.S. after the so called "ban" went into effect. An April Filled with Repeats - FactCheck.org
Trump claims intelligence officials did not raise coronavirus until late January
Reports by news organizations claim that the intelligence agencies started to warn Donald in early January. And, Donald does not explain why he continued to downplay the pandemic throughout February after admittedly receiving a warning in late January.
As Deaths In U.S. Continue, A Look At Trump's Words On Virus-YouTube
 |
| As of 5/8/20 |
Hydroxychloroquine is Doctor Don's much touted "miracle cure" for Covid-19 infections.
In fairness to Doctor Don, M.D. in B.S., hydroxychloroquine has not yet been conclusively proven IMO to have no benefit when given to COVID-19 patients.
The reliable evidence so far, as noted below, is that this "miracle drug" does not have any scientifically observed benefit, and there is evidence that some patients are seriously harmed by it.
The point to keep in mind is that Donald and his Fox News sycophants were touting this drug based on no scientifically reliable trials.
Hydroxychloroquine fails to help hospitalized coronavirus patients in US funded study The results for this study, financed by the U.S. government's National Institute of Health, was published in the last Thursday in the New England Journal of Medicine.
These articles discuss the results of a study conducted by the Veterans Administration. Covid-19: VA Study Points to Increased Mortality with Hydroxychloroquine-Physician's Weekly; Hydroxychloroquine Ineffective for COVID-19, VA Study Suggests
It is a miracle that the Teflon Don pays no political price for spreading fact free B.S. Fox News Goes Radio Silent on Trump’s Coronavirus Miracle Drug-Vanity Fair; Fox News mentions of hydroxychloroquine have significantly dropped off-Media Matters for America
Fox news personalities, including Laura Ingraham, Tucker Carlson and Sean Hannity, repeatedly touted the drug, as part of their mindless defense of anything that comes out of Trump's mouth, and they lambasted scientists and other media organizations who repeatedly made fact based observations about this drug.
Fox News has promoted hydroxychloroquine nearly 300 times in a two-week period-Media Matters for America;
Why Did Fox News's Laura Ingraham Relentlessly Push Hydroxychloroquine?-GQ
Fox News Stars Trumpeted a Malaria Drug, Until They Didn’t - The New York Times
Hydroxychloroquine truther Laura Ingraham attempts to discredit promising new coronavirus treatment-Salon.com;
From Fox News, a big dose of dumb on hydroxychloroquine-The Washington Post
What Trump and Fox News hosts said about hydroxychloroquine; Tucker Carlson: Why are media pundits trying to discredit hydroxychloroquine? - YouTube
++
Donald's Political Considerations Deep Six CDC Guidelines to Protect Worker Health:
AP Exclusive: Top White House officials buried CDC report
Trump administration shelves CDC guide to reopening country: AP - MarketWatch;
AP Exclusive: US shelves detailed guide to reopening country
White House Blocks C.D.C. Guidance
The CDC was reportedly told by the Trump Administration that the guidelines would never see the light of day. That resulted in a leak of the CDC guidelines the news media. White House is reviewing detailed guidance for gradual reopening-The Washington Post (copy of guidelines linked) In responding to the AP story, a WH official claimed the guidelines were "overly specific" on how employers could protect employees, which is an acknowledgment that Trump tried to deep six them.
Trump tightens grip on coronavirus information as he pushes to restart the economy
This is just another example of political considerations overriding health recommendations made by experts.
+++
Donald Will Drain the D.C. Swamp Very Soon:
Virus Whistle-Blower Says Trump Administration Steered Contracts to Cronies
Kushner COVID-19 team prioritized PPE bids from Trump associates: NYT - Business Insider
Donald will start to drain the D.C. swamp "very soon".
He will start that process by resigning "very soon". Tracking President Trump's Unprecedented Conflicts of Interest - CREW
+++
Trump's Decision to Reopen the Economy without adequate testing and contact tracing in place:
34 days of pandemic: Inside Trump’s desperate attempts to reopen America Worth reading.
Trump says it’s safe to reopen states as governors grapple with loosening restrictions He also said that he expected deaths to hit 80,000-90,000 possibly as high as 100,000, up from his previous estimate of 65K. Trump claims Lincoln got better press treatment as he ups Covid-19 death estimate He revised his previous estimate of 65,000 when the death count was 67+K.
After much study and deep reflection, Doctor Don has concluded that testing for COVID-19 is overrated since the person may become infected after the test. Trump says tests are 'overrated,'; Trump plays down coronavirus testing as U.S. falls far short of level scientists say is needed - The Washington Post
Doofus Don's conclusion about testing is not shared by anyone who actually knows what they are talking about.
To slow down the infection rate, it is important to identify those who are asymptomatic but capable of infecting others. Those who are infected would then go into a 14 day quarantine and their known contacts would then be traced, contacted and tested. Any contact who has become infected would be isolated for 14 days and so on.
The goal is to prevent an out-of-control pandemic and to to shut down as quickly as possible emerging hot spots.
The other reasons include identifying those persons who have developed antibodies after becoming infected and may be immune to further infections. There are a variety of reasons for having that information.
Another reason for testing is to learn more about this infectious disease including its true mortality and serious illness rates as a percentage of the total number of infections.
Trump to ABC's Muir: 'It's possible there will be some' deaths as country reopens
Trump Administration Models Predict Near Doubling of Daily Death Toll by June
A mutant coronavirus has emerged, even more contagious than the original, Los Alamos National Lab study says
Trump cheers on governors even as they ignore White House coronavirus guidelines in race to reopen
Coronavirus may last 2 years, study warns. And its second wave could be worse. The second wave of the Spanish Flu was far worse than the first wave and occurred after the virus had mutated to a more dangerous form. Why the Second Wave of the 1918 Spanish Flu Was So Deadly - HISTORY
US is unprepared to protect residents from virus while states are reopening, former acting CDC director says
US lurches toward reopening despite ominous coronavirus models; COVID-19 Model IMHE
+++++
Don the Authoritarian Fires another Inspector General for Doing their Job:
Coronavirus: Trump looks to replace HHS Inspector General Christi Grimm who reported supply shortages; Trump seeks to replace HHS watchdog who reported hospital shortages | TheHill The HHS IG simply reported the results of a survey conducted by HHS. Trump blasts HHS watchdog for report on hospital shortages - POLITICO
Since the results did not please Don the Authoritarian, she had had to be replaced with someone who knows better than to report facts that Donald does not like. Trump decries IG report on hospital shortages as 'another fake dossier' | TheHill
Trump replaces Christi Grimm, HHS watchdog who found shortages in coronavirus testing, supplies at hospitals - The Washington Post
The message that Don the Authoritarian clearly sends to every federal employe is to do nothing that undermines his reality creations.
Donald has proven beyond any doubt that lying about everything works on at least one half of Americans, so it is important for Trump to fire anyone who is just doing their job publishing a routine report that rebuts Donald's reality creations.
Donald Is Incapable of Telling the Truth:
Lying all of the time and misleading the public on matters of national interest are just two of Donald's "conservative" virtues
One of the lies that Lying Don will continue to propagate repeatedly is his claim that he banned travel from China on 1/31/20. Trump imposed restrictions. Almost 40K individuals travelled from China to the U.S. after the so called "ban" went into effect. An April Filled with Repeats - FactCheck.org
Trump claims intelligence officials did not raise coronavirus until late January
Reports by news organizations claim that the intelligence agencies started to warn Donald in early January. And, Donald does not explain why he continued to downplay the pandemic throughout February after admittedly receiving a warning in late January.
Fact check: Trump falsely suggests he was right when he predicted 'close to zero' virus cases in February
Trump says he is in charge of work to produce a vaccine When asked by a reporter who is in charge of the vaccine operation, Trump said, “honestly, I am. I’m really in charge of it. I think probably more than anything I’m in charge.”
Who could be better than Doctor Don? Someone who was actually qualified like Dr. Rick Bright that Donald fired for doing his job.
Dr. Bright OSC Complaint_Redacted.pdf (substance of the whistleblower complaint starts at page 27 of the PDF.)
Watchdog office says ‘reasonable grounds’ to believe ouster of vaccine official was retaliatory, his lawyers say - The Washington Post Looks like another watchdog will soon be fired.
Fired scientist Rick Bright says U.S. could have done more to save lives
Don the Con claimed that the nation will be doing 5 million coronavirus tests per day "very soon". Trump says US will be able to run 5 million coronavirus tests per day 'very soon,' despite shortages across states When he made that representation to the American people, the highest number of tests in a single day was 314,182, on April 22. The COVID Tracking Project | The COVID Tracking Project John Hopkins tallied 5,795,728 total U.S. tests as of 4/28/20. Donald did not specify how he arrived at 5 million tests per day or what is meant by "very soon"; and he claimed that “if you look at the numbers, it could be that we’re getting very close.” I looked at the numbers and Donald's claim is ridiculous.
Donald's testing claim was captured on video. Later that day, the top U.S. official in charge of testing stated there was no way the nation could ever hit 5 million tests per day. Coronavirus testing chief says 'no way on Earth' US can test 5 million a day; Testing Czar Says U.S. Can't Run 5 Million Tests a Day | Time
A reporter then asked Donald about his claim that 5 million tests would be administered per day very soon. Lying Don asserted that he never made that statement, and the denial was captured on video as well. Trump backtracks after saying U.S. would "very soon" hit 5 million tests a day - CBS News; Trump: I didn’t say it. (He did, and here is the tape.) - YouTube
Donald has denied making a statement within a few seconds after making it. It does not matter to him that both the false statement and the false denial of making the statement are both caught on video.
Trump’s Response to Virus Reflects a Long Disregard for Science - The New York Times; Science Under Attack: How Trump Is Sidelining Researchers and Their Work - The New York Times
'My Fellow American': Donald Trump letter to stimulus check recipients raises objections
Larry Kudlow ‘unravels’ after CNN airs video of him saying in February that the coronavirus was ‘contained’ - MarketWatch There was no justification for Kudlow or Trump to claim then that the virus was contained. Both were unhappy with the science based remarks made by Dr. Nancy Messonnier who runs the CDC National Center for Immunization and Respiratory Diseases. C.D.C. Officials Warn of Coronavirus Outbreaks in the U.S.-The New York Times; Trump threatened to fire CDC's chief of respiratory diseases in February: report | TheHill
CDC says it expects 'community spread' of coronavirus, warns of disruption (2/25/20 article)
Larry Kudlow says on 2/25/20 US has contained the coronavirus and the economy is holding up nicely; 'Nothing to worry about' and 'it's being contained': How Trump officials downplayed the coronavirus; Kudlow breaks with CDC on coronavirus: ‘We have contained this’ - POLITICO
Trump’s New Press Secretary Kayleigh McEnany Lied In Her First Briefing after promising never to lie She also claims that Donald has never lied. Trump‘s New Press Secretary Kayleigh McEnany’s Long History of Bullshit and Lies
Donald is going to start draining the D.C. swamp "soon". Strategic National Stockpile chief Robert Kadlec focused on biodefense -- and a former client, Emergent BioSolutions, benefited - The Washington Post
+++
Donalds Claims Secret Intelligence Shows China Created Covid-19:
It is a given that China will lie and will be less than forthcoming with information about infectious diseases originating in that country. It is also a given that Trump will lie.
For those who are still grounded in reality, it is fair to conclude that China delayed reporting information that would have resulted in far fewer infections and deaths in other countries. Dr. Fauci: China delayed our understanding of COVID-19’s efficient transmissibility; Coronavirus: China delayed reporting the outbreak and the WHO is staying mum - Vox relying in part Clinical features of patients infected with 2019 novel coronavirus in Wuhan, China - The Lancet
Similar failures in China have been noted in the SARS pandemic. Transparency a key lesson learned from Sars outbreak in mainland China | South China Morning Post; As New Coronavirus Spread, China’s Old Habits Delayed Fight - The New York Times
One day after a Shanghai laboratory publicly shared the first genome sequence of COVID-19, which allowed the world to develop test kits, China shut down the lab for "rectification". Chinese laboratory that first shared coronavirus genome with world ordered to close for ‘rectification’, hindering its Covid-19 research | South China Morning Post That is a most damning fact for China.
There is general agreement in western democracies that China made it easier for the virus to become a worldwide pandemic. I would agree with that assessment.
Irrespective of China's failure to provide necessary information, I would note that conclusions about the "efficient transmissibility" were in fact deduced by U.S. experts in February, simply from the rapid infection rates among the passengers and crew of the Diamond Princess and in the numbers actually disclosed by China. Fauci admitted the US coronavirus response was delayed. Trump then retweeted a call to fire him. - Vox There is significant evidence that U.S. experts reached that conclusion no later than mid-February. Based on what I have learned about coronaviruses in general over the past two months, that conclusion was possible for infectious disease experts no later than 1/31/2019 IMO.
A lack of transparency is a different issue than the claims, being made by Donald and other republicans, that China manufactured COVID-19 or the virus came from a lab in Wuhan (not man made but released from that source). There are political reasons related to the upcoming election for those accusations.
Fauci: No scientific evidence the coronavirus was made in a Chinese lab
Donald claimed that he had seen secret evidence that China created the coronavirus in a Wuhan lab, which was so secret that he could not discuss it even though he can declassify the material. Trump says he has proof coronavirus came from Wuhan lab but is 'not allowed to tell' - Business Insider
John Roberts asked him about the report released earlier that day by the Office of the Director of National Intelligence that it agreed with the "wide scientific consensus" that the coronavirus was not "manmade or genetically modified".
This is the exchange between Roberts and Donald after Roberts referenced the ODNI statement:
Trump: "Who was that, who was that that said that?"
Roberts: "The Office of the Director of National Intelligence,"
Trump: "Yeah, but who in particular, who was the man that made that statement?"
Roberts: "It was a statement that the ODNI —" (Trump cuts him off before he can finish the statement)
Trump: "Oh, he would know that, huh?" He is referring here to Richard Grenell, the Trumpster that he recently installed as the Director of National Intelligence.
Don the Authoritarian is about to solve the problem of fact based intelligence coming from the Office of National Intelligence. He has appointed a Trumpster Congressman from Texas, John Ratcliffe, to become its Director. Radcliffe's qualifications for this job is that he will do what Donald tells him and he is a believer in conspiracy theories hatched by wingnuts. John Ratcliffe, Trump's DNI nominee, follows QAnon Twitter. That's disqualifying. Trump's Pick for Top Intelligence Chief, John Ratcliffe, Faces Lawmakers in Confirmation Hearing, Despite Once Being Considered Unqualified
Secretary of State Mike Pompeo claims China intentionally concealed coronavirus severity Pompeo claimed there was a "significant amount of evidence" that COVID-19 originated from a "laboratory in Wuhan". He then stated he had no reason to disbelieve the report prepared by Office of of the Director of National Intelligence that the "Intelligence Community also concurs with the wide scientific consensus that the COVID-19 virus was not manmade or genetically modified." Those claims are not mutually exclusive.
The primary evidence supporting the claim that the virus originated in a Wuhan lab consists of the following: (1) there is a "research" laboratory in Wuhan that handled bat viruses, a possible first source for Covid-19; (2) the lab has had some problems with safety in the past; and (3) the virus outbreak started in Wuhan. Those facts create a suspicion that some accident in the lab may have set in motion the first human transmission. But that is a best circumstantial and is contrary to the consensus view that the virus had a natural origin, probably in one or more of Wuhan's live animal food markets.
China is a breeding ground for coronaviruses in animals.
Irrespective of whether the lab got sloppy somehow or China's live meat markets conjured up the virus in the old time tested way, neither of those original causes excuse the long delay in the U.S. response, or any problems that may ensue now from reopening businesses too early.
Trump says he is in charge of work to produce a vaccine When asked by a reporter who is in charge of the vaccine operation, Trump said, “honestly, I am. I’m really in charge of it. I think probably more than anything I’m in charge.”
Who could be better than Doctor Don? Someone who was actually qualified like Dr. Rick Bright that Donald fired for doing his job.
Dr. Bright OSC Complaint_Redacted.pdf (substance of the whistleblower complaint starts at page 27 of the PDF.)
Watchdog office says ‘reasonable grounds’ to believe ouster of vaccine official was retaliatory, his lawyers say - The Washington Post Looks like another watchdog will soon be fired.
Fired scientist Rick Bright says U.S. could have done more to save lives
Don the Con claimed that the nation will be doing 5 million coronavirus tests per day "very soon". Trump says US will be able to run 5 million coronavirus tests per day 'very soon,' despite shortages across states When he made that representation to the American people, the highest number of tests in a single day was 314,182, on April 22. The COVID Tracking Project | The COVID Tracking Project John Hopkins tallied 5,795,728 total U.S. tests as of 4/28/20. Donald did not specify how he arrived at 5 million tests per day or what is meant by "very soon"; and he claimed that “if you look at the numbers, it could be that we’re getting very close.” I looked at the numbers and Donald's claim is ridiculous.
Donald's testing claim was captured on video. Later that day, the top U.S. official in charge of testing stated there was no way the nation could ever hit 5 million tests per day. Coronavirus testing chief says 'no way on Earth' US can test 5 million a day; Testing Czar Says U.S. Can't Run 5 Million Tests a Day | Time
A reporter then asked Donald about his claim that 5 million tests would be administered per day very soon. Lying Don asserted that he never made that statement, and the denial was captured on video as well. Trump backtracks after saying U.S. would "very soon" hit 5 million tests a day - CBS News; Trump: I didn’t say it. (He did, and here is the tape.) - YouTube
Donald has denied making a statement within a few seconds after making it. It does not matter to him that both the false statement and the false denial of making the statement are both caught on video.
Trump’s Response to Virus Reflects a Long Disregard for Science - The New York Times; Science Under Attack: How Trump Is Sidelining Researchers and Their Work - The New York Times
'My Fellow American': Donald Trump letter to stimulus check recipients raises objections
Larry Kudlow ‘unravels’ after CNN airs video of him saying in February that the coronavirus was ‘contained’ - MarketWatch There was no justification for Kudlow or Trump to claim then that the virus was contained. Both were unhappy with the science based remarks made by Dr. Nancy Messonnier who runs the CDC National Center for Immunization and Respiratory Diseases. C.D.C. Officials Warn of Coronavirus Outbreaks in the U.S.-The New York Times; Trump threatened to fire CDC's chief of respiratory diseases in February: report | TheHill
CDC says it expects 'community spread' of coronavirus, warns of disruption (2/25/20 article)
Larry Kudlow says on 2/25/20 US has contained the coronavirus and the economy is holding up nicely; 'Nothing to worry about' and 'it's being contained': How Trump officials downplayed the coronavirus; Kudlow breaks with CDC on coronavirus: ‘We have contained this’ - POLITICO
Trump’s New Press Secretary Kayleigh McEnany Lied In Her First Briefing after promising never to lie She also claims that Donald has never lied. Trump‘s New Press Secretary Kayleigh McEnany’s Long History of Bullshit and Lies
Donald is going to start draining the D.C. swamp "soon". Strategic National Stockpile chief Robert Kadlec focused on biodefense -- and a former client, Emergent BioSolutions, benefited - The Washington Post
+++
Donalds Claims Secret Intelligence Shows China Created Covid-19:
It is a given that China will lie and will be less than forthcoming with information about infectious diseases originating in that country. It is also a given that Trump will lie.
For those who are still grounded in reality, it is fair to conclude that China delayed reporting information that would have resulted in far fewer infections and deaths in other countries. Dr. Fauci: China delayed our understanding of COVID-19’s efficient transmissibility; Coronavirus: China delayed reporting the outbreak and the WHO is staying mum - Vox relying in part Clinical features of patients infected with 2019 novel coronavirus in Wuhan, China - The Lancet
Similar failures in China have been noted in the SARS pandemic. Transparency a key lesson learned from Sars outbreak in mainland China | South China Morning Post; As New Coronavirus Spread, China’s Old Habits Delayed Fight - The New York Times
One day after a Shanghai laboratory publicly shared the first genome sequence of COVID-19, which allowed the world to develop test kits, China shut down the lab for "rectification". Chinese laboratory that first shared coronavirus genome with world ordered to close for ‘rectification’, hindering its Covid-19 research | South China Morning Post That is a most damning fact for China.
There is general agreement in western democracies that China made it easier for the virus to become a worldwide pandemic. I would agree with that assessment.
Irrespective of China's failure to provide necessary information, I would note that conclusions about the "efficient transmissibility" were in fact deduced by U.S. experts in February, simply from the rapid infection rates among the passengers and crew of the Diamond Princess and in the numbers actually disclosed by China. Fauci admitted the US coronavirus response was delayed. Trump then retweeted a call to fire him. - Vox There is significant evidence that U.S. experts reached that conclusion no later than mid-February. Based on what I have learned about coronaviruses in general over the past two months, that conclusion was possible for infectious disease experts no later than 1/31/2019 IMO.
A lack of transparency is a different issue than the claims, being made by Donald and other republicans, that China manufactured COVID-19 or the virus came from a lab in Wuhan (not man made but released from that source). There are political reasons related to the upcoming election for those accusations.
Fauci: No scientific evidence the coronavirus was made in a Chinese lab
Donald claimed that he had seen secret evidence that China created the coronavirus in a Wuhan lab, which was so secret that he could not discuss it even though he can declassify the material. Trump says he has proof coronavirus came from Wuhan lab but is 'not allowed to tell' - Business Insider
John Roberts asked him about the report released earlier that day by the Office of the Director of National Intelligence that it agreed with the "wide scientific consensus" that the coronavirus was not "manmade or genetically modified".
This is the exchange between Roberts and Donald after Roberts referenced the ODNI statement:
Trump: "Who was that, who was that that said that?"
Roberts: "The Office of the Director of National Intelligence,"
Trump: "Yeah, but who in particular, who was the man that made that statement?"
Roberts: "It was a statement that the ODNI —" (Trump cuts him off before he can finish the statement)
Trump: "Oh, he would know that, huh?" He is referring here to Richard Grenell, the Trumpster that he recently installed as the Director of National Intelligence.
Don the Authoritarian is about to solve the problem of fact based intelligence coming from the Office of National Intelligence. He has appointed a Trumpster Congressman from Texas, John Ratcliffe, to become its Director. Radcliffe's qualifications for this job is that he will do what Donald tells him and he is a believer in conspiracy theories hatched by wingnuts. John Ratcliffe, Trump's DNI nominee, follows QAnon Twitter. That's disqualifying. Trump's Pick for Top Intelligence Chief, John Ratcliffe, Faces Lawmakers in Confirmation Hearing, Despite Once Being Considered Unqualified
Secretary of State Mike Pompeo claims China intentionally concealed coronavirus severity Pompeo claimed there was a "significant amount of evidence" that COVID-19 originated from a "laboratory in Wuhan". He then stated he had no reason to disbelieve the report prepared by Office of of the Director of National Intelligence that the "Intelligence Community also concurs with the wide scientific consensus that the COVID-19 virus was not manmade or genetically modified." Those claims are not mutually exclusive.
The primary evidence supporting the claim that the virus originated in a Wuhan lab consists of the following: (1) there is a "research" laboratory in Wuhan that handled bat viruses, a possible first source for Covid-19; (2) the lab has had some problems with safety in the past; and (3) the virus outbreak started in Wuhan. Those facts create a suspicion that some accident in the lab may have set in motion the first human transmission. But that is a best circumstantial and is contrary to the consensus view that the virus had a natural origin, probably in one or more of Wuhan's live animal food markets.
China is a breeding ground for coronaviruses in animals.
Irrespective of whether the lab got sloppy somehow or China's live meat markets conjured up the virus in the old time tested way, neither of those original causes excuse the long delay in the U.S. response, or any problems that may ensue now from reopening businesses too early.
The buck never stops on Trump's desk. In order to shift blame away from his Administration for its incompetence, Trump wants the intelligence community to manufacture a claim that China created COVID-19 on purpose. Trump Officials Are Said to Press Spies to Link Virus and Wuhan Labs ("scientists who have studied the genetics of the coronavirus say that the overwhelming probability is that it leapt from animal to human in a nonlaboratory setting, as was the case with H.I.V., Ebola and SARS..") Evidence is of course irrelevant in Trump's America and is certainly unnecessary to support an accusation.
Trump has alienated just about every government in the world. The reasons have nothing to do with the nation's national interest, but what he views as advancing his personal political interests.
15 times Trump praised China as coronavirus was spreading across the globe - POLITICO
Made in China: Trump re-election flags may get burned by his tariffs - Reuters
++
Trump: Protestors Who Stormed Michigan's Capital with Assault Rifles are Good People:
Several legislators who were present believed it was necessary to put on bullet proof vests as the Trumpsters attempted to enter the legislative chamber with their assault rifles. President Trump tweets support for Michigan Capitol protesters
Governor Whitmer had a different take: Gov. Gretchen Whitmer calls protest at Capitol 'disturbing' - YouTube
Fox host defends Michigan protesters with Confederate flags - Business Insider
Stay-at-home protests draw militias, white supremacists and anti-vaxxers - The Washington Post In Trump's America, white supremacists and nationalists are "good people".
Dr. Birx: Michigan protests ‘devastatingly worrisome’; vaccine ‘possible’ by January
++++
Sample of Trump Tweets 5/1 and 5/2:
The Fake News President continues to claim that there is no shortage of test kits.
The mayors and governors who regularly claim that Donald's claim is false are just trying to hurt him politically.
Testing Remains Scarce as Governors Weigh Reopening States - The New York Times Reporting facts is Fake News in Trump's America.
Only 39% of republicans in 6 battleground states are currently seriously concerned about COVID-19. A majority of republicans believe it is safe to go shopping (85%), dine out (70%); go to work (81%); and go to a bar (52%). States of Play: Change Research/CNBC Poll on COVID-19 This poll was taken in early May. There is a clear partisan divide in how republicans and democrats view those safety questions.
++
15 times Trump praised China as coronavirus was spreading across the globe - POLITICO
Made in China: Trump re-election flags may get burned by his tariffs - Reuters
++
Trump: Protestors Who Stormed Michigan's Capital with Assault Rifles are Good People:
Governor Whitmer had a different take: Gov. Gretchen Whitmer calls protest at Capitol 'disturbing' - YouTube
Fox host defends Michigan protesters with Confederate flags - Business Insider
Stay-at-home protests draw militias, white supremacists and anti-vaxxers - The Washington Post In Trump's America, white supremacists and nationalists are "good people".
Dr. Birx: Michigan protests ‘devastatingly worrisome’; vaccine ‘possible’ by January
++++
Sample of Trump Tweets 5/1 and 5/2:
Testing Remains Scarce as Governors Weigh Reopening States - The New York Times Reporting facts is Fake News in Trump's America.
Only 39% of republicans in 6 battleground states are currently seriously concerned about COVID-19. A majority of republicans believe it is safe to go shopping (85%), dine out (70%); go to work (81%); and go to a bar (52%). States of Play: Change Research/CNBC Poll on COVID-19 This poll was taken in early May. There is a clear partisan divide in how republicans and democrats view those safety questions.
++
Covid-19 Updates:
Covid-19 death toll: U.S. excess fatalities hit estimated 37,100 in pandemic's early days - The Washington Post One of the narrative advanced by republicans, with no supporting evidence, is that the death toll is being exaggerated in some kind of conspiracy involving state health departments, doctors nationwide and the CDC. It is far more likely, based on what is known now, that the count substantially underestimates the COVID-19 linked deaths.
Fauci warns US could 'be in for a bad fall' if coronavirus treatments don't work This warning is consistent with what he has been saying. The fall season could be significantly worse than normal for respiratory illnesses when Covid-19 infections are added to even a normal flu season.
Public Health Response to the Initiation and Spread of Pandemic COVID-19 in the United States, February 24–April 21, 2020 | MMWR
As ‘quarantine fatigue’ spreads, Fauci says second wave of coronavirus is ‘inevitable’
Public Health Response to the Initiation and Spread of Pandemic COVID-19 in the United States, February 24–April 21, 2020 | MMWR
As ‘quarantine fatigue’ spreads, Fauci says second wave of coronavirus is ‘inevitable’
Airborne Coronavirus Detected in Wuhan Hospitals
Covid-19 appears far more lethal than flu based on antibody test results - The Washington Post
At Louisiana prison, 192 out of 195 inmates test positive for COVID-19 - MarketWatch
Mapping Covid-19 in meat and food processing plants | Food and Environment Reporting Network
58 percent of workers at Tyson meat factory in Iowa test positive for coronavirus
Nearly 900 workers at a Tyson Foods plant in Indiana test positive for coronavirus
This is an excellent analysis using facts of how Laura Ingraham misled her viewers on 4/28/20: Dissecting Laura Ingraham’s attempt to gin up a mystery around coronavirus in New York-The Washington Post Of the Fake News creators at FOX, she is IMO the most skillful.
White House Press Secretary Repeats Russia Talking Point - FactCheck.org
The Trump campaign’s egregious editing of a CNN clip - The Washington Post Donald's fundamental dishonesty with inundate his campaign commercials.
+++
Texas: Park ranger pushed into lake for asking visitors to follow social-distancing guidelines - MarketWatch
Oklahoma city order requiring face mask use overturned due to violence - Business Insider
Security guard is shot and killed after telling customer to put on a face mask - CNN
Customers shot 2 McDonald's employees in Oklahoma City after being told to leave due to coronavirus restrictions - CNN
A Dollar Tree worker told a man he needed a mask, so he wiped his face on her shirt, police say - CNN
++++++
Covid-19 appears far more lethal than flu based on antibody test results - The Washington Post
At Louisiana prison, 192 out of 195 inmates test positive for COVID-19 - MarketWatch
Mapping Covid-19 in meat and food processing plants | Food and Environment Reporting Network
58 percent of workers at Tyson meat factory in Iowa test positive for coronavirus
Nearly 900 workers at a Tyson Foods plant in Indiana test positive for coronavirus
This is an excellent analysis using facts of how Laura Ingraham misled her viewers on 4/28/20: Dissecting Laura Ingraham’s attempt to gin up a mystery around coronavirus in New York-The Washington Post Of the Fake News creators at FOX, she is IMO the most skillful.
White House Press Secretary Repeats Russia Talking Point - FactCheck.org
The Trump campaign’s egregious editing of a CNN clip - The Washington Post Donald's fundamental dishonesty with inundate his campaign commercials.
+++
Texas: Park ranger pushed into lake for asking visitors to follow social-distancing guidelines - MarketWatch
Oklahoma city order requiring face mask use overturned due to violence - Business Insider
Security guard is shot and killed after telling customer to put on a face mask - CNN
Customers shot 2 McDonald's employees in Oklahoma City after being told to leave due to coronavirus restrictions - CNN
A Dollar Tree worker told a man he needed a mask, so he wiped his face on her shirt, police say - CNN
++++++
All trades are commission free except as otherwise noted:
The reasons for selling the highest cost lots first are (1) to reduce my income tax obligation resulting from a sell; (2) to generate a total return in excess of the dividend payments; (3) to increase my dividend yield on the remaining shares; (4) to take advantage of normal up and down volatility by selling the highest cost lots profitably and then by buying when the price falls below the lowest price paid in the chain; (5) to make it more likely that I will buy during a meltdown after selling higher cost shares (psychological); and (6) to mitigate risk through less at risk monetary exposure. Risk is also controlled through small odd lot trades.
I am not concerned about the dollar value of the profit provided I am in achieving the objectives set out above.
An example of this trading strategy can be found in Item # 1 below.
1. Restarted PWCDF-Bought 100 at US at $15.65; 10 at $14.37 ; 10 at $14.98 and Sold 10 at $16.31:
Purchases: 120 shares
I mentioned the 100 share purchase in a 4/8 comment.
Sold 10 Shares:
Current Position: 110 shares
Quotes:
USD Priced Shares (US pink sheet exchange): Power Corp. of Canada (PWCDF) Symbols ending in "F" denote ordinary shares of a foreign company, not an ADR, priced in USDs.
CAD Priced Shares (Toronto stock exchange): Power Corp. of Canada Stock Quote (Canada: Toronto)
In the past, I have owned both the CAD and USD priced shares. Currently, I own only 100 shares of the USD priced shares traded on the U.S. pink sheet exchange.
Profit Snapshot 10 Shares sold at US$16.31: $6.6
The 10 share sell was out of the highest cost lot purchase.
With a price surge above US$17, I will consider selling another 10 share lot.
Average Cost 110 Shares = US$15.47
5 Year Chart:
Dividend: Quarterly at C$44.75 (C$1.79 annually)
Dividend Yield: The yield will vary for owners of PWCDF based on the CAD/USD conversion rate.
If I assumed a .72 CAD/USD rate for all dividend payments at the current quarterly rate, the dividend yield would be about 8.34% before taxes (C$1.79 x. .72 = US$1.29 rounded ÷ $15.47 = 8.34%) The actual yield will rise or fall with conversion values in existence at the time of payment. At a 1 to 1 rate, the annual dividend rate for example would be US$1.79 (same as the CAD), and the dividend yield would then be 11.57% with no change in the CAD dividend rate.
Acquisition of Power Financial: This acquisition was completed earlier this year. Power Corporation of Canada | December 13, 2019 - Power Corporation and Power Financial Announce Reorganization, Simplified Corporate Structure and Refocused Strategy; February 13, 2020 - Power Corporation and Power Financial Announce Completion of Reorganization and the Determination of the Final Offer Price for the Pre-Emptive Right - Press Releases | Power Corporation of Canada
Current Organizational Chart:
Several of the companies mentioned in the organizational chart are publicly traded:
IGM Financial Inc. (Canada: Toronto); IGM Financial Inc. (website link)
Great-West Lifeco Inc (Canada: Toronto)
Pargesa Holding S.A. (Switzerland: SWX)
Groupe Bruxelles Lambert S.A. (Belgium: Euronext Brussels)
Groupe Bruxelles owns stock interests in several European based companies:
More information about Pargesa and Groupe Bruxelles: Pargesa; Home Pargesa; GBL - Investment holding
At the right price, I would like to see the company sell its 27.8% interest in Pargesa, which controls 50% of GBL, and then use the proceeds to buyback stock. I don't believe the value of the Pargesa investment is reflected in the Power Corporation stock price.
In August 2017, the Mackenzie investment unit of IGM Financial (62.1% owned) acquired a 13.9% interest in China AMC, a Beijing based asset manager, for $638M. IGM Financial Inc. Completes Acquisition of 13.9% Interest in Market-Leading China Asset Management Co., Ltd.
Another subsidiary of Power Corporation of Canada, Power Energy Corporation, acquired a 55.7% stake in Lumenpulse (high performance LED solutions), for $638M in 2017. Website: Power Energy Corporation
Another company that appears in the organizational chart is Sagard Holdings, an alternative asset manager.
When looking at all of these companies, and their values, it is important to keep in mind that the market cap of Power Corporation of Canada is currently around C$15.08B at C$20.97 according to MarketWatch.
Share Buyback: April 17, 2019 - Power Corporation Announces Final Results of Substantial Issuer Bid (" Power Corporation of Canada . . .today announced that, under the Corporation's substantial issuer bid (the "PCC Offer"), it has taken up and is purchasing for cancellation 40,909,041 of its subordinate voting shares ("Shares") at a purchase price of C$33.00 per Share representing C$1.35 billion of its subordinate voting shares.")
Last Earnings Report (12/31/20): Power Corporation Reports Fourth Quarter and 2019 Financial Results and Dividend Increase
"Net earnings attributable to common shareholders were $401 million or $0.60 per share, compared with $478 million or $0.67 per share in 2018.
Adjusted net earnings attributable to common shareholders were $591 million or $0.89 per share, compared with $460 million or $0.65 per share in 2018."
Broker Reports:
Morningstar (1/6/20): 4 stars with a FV of C$33 with no moat.
S & P (4/14/20): 3 stars with a 12 month PT of C$26
The CAD priced shares closed last Friday at C$20.97.
I do not have access to any other report.
Sell and Buy Discussions: Item # 4 Sold 100 PWCDF at $22.03 (10/5/19 Post)(profit snapshot $110.05)-Item # 1 Bought 100 PWCDF at US$20.83 (5/29/19 Post); Item # 4.A. Sold 100 PWCDF at $23.56 (7/22/17)(profit snapshot= $141.95)-Item # 3.A. Bought 100 PWDCF at $22.14 (5/28/17 Post); Item # 1. Sold 400 POW:TO at C$31.05: Update For Portfolio Positioning And Management As Of 4/29/16 - South Gent | Seeking Alpha (USD Profit = $360.45); Item # 2 Sold 100 PWCDF at $28.07 (11/22/14 Post) (profit snapshot=+$210.03)-Bought Back Power Corporation Of Canada At $25.81 Item # 5 SOLD Taxable Accounts: 100 PWCDF at $28.83 (8/2/14 Post)(profit snapshot+$138.71)-Item # 4 Bought 100 PWCDF at $27.29 (7/12/14 Post)
Victory in PWCDF trades is defined as (1) selling at profit after (2) collecting one or more quarterly dividends and (3) buying the stock back at a lower price than the previous purchase without missing more than 2 dividend payments.
As discussed above, Power Corporation acquired that shares of Power Financial that it did not own, offering Power Financial shareholders 1.05 shares of Power Corporation for each share. The shares of Power Financial popped in response to the offer which fortunately prompted me, based on subsequent PWCDF price history, to sell my Power Financial Shares. I would have been much worse off now keeping the Power Financial shares and receiving 105 Power Corporation shares.
Power Financial Trades: Item # 1A. Sold 50 POFNF at US$27.04 (1/8/2020 Post)(profit snapshot = US$299.2); Item # 1.B. Sold 50 PWF:CA at C$35.14 (1/8/20 Post)(profit snapshot C$480); Item # 2 Bought 50 POFNF at US$20.96 (8/14/19 Post); Item # 5.A. Bought 50 PWF:CA at C$25.5 (1/23/19 Post); Item # 4.A. Bought 50 PWF:CA at C$27.73 (12/23/18 Post)(profit snapshot = C$161)-Item # 2.A. Sold 50 of 100 PWF:CA at C$30.99 (3/31/19 Post)
Purchases: 120 shares
Sold 10 Shares:
Current Position: 110 shares
Quotes:
USD Priced Shares (US pink sheet exchange): Power Corp. of Canada (PWCDF) Symbols ending in "F" denote ordinary shares of a foreign company, not an ADR, priced in USDs.
CAD Priced Shares (Toronto stock exchange): Power Corp. of Canada Stock Quote (Canada: Toronto)
In the past, I have owned both the CAD and USD priced shares. Currently, I own only 100 shares of the USD priced shares traded on the U.S. pink sheet exchange.
Profit Snapshot 10 Shares sold at US$16.31: $6.6
With a price surge above US$17, I will consider selling another 10 share lot.
Average Cost 110 Shares = US$15.47
5 Year Chart:
Dividend Yield: The yield will vary for owners of PWCDF based on the CAD/USD conversion rate.
If I assumed a .72 CAD/USD rate for all dividend payments at the current quarterly rate, the dividend yield would be about 8.34% before taxes (C$1.79 x. .72 = US$1.29 rounded ÷ $15.47 = 8.34%) The actual yield will rise or fall with conversion values in existence at the time of payment. At a 1 to 1 rate, the annual dividend rate for example would be US$1.79 (same as the CAD), and the dividend yield would then be 11.57% with no change in the CAD dividend rate.
Acquisition of Power Financial: This acquisition was completed earlier this year. Power Corporation of Canada | December 13, 2019 - Power Corporation and Power Financial Announce Reorganization, Simplified Corporate Structure and Refocused Strategy; February 13, 2020 - Power Corporation and Power Financial Announce Completion of Reorganization and the Determination of the Final Offer Price for the Pre-Emptive Right - Press Releases | Power Corporation of Canada
Current Organizational Chart:
IGM Financial Inc. (Canada: Toronto); IGM Financial Inc. (website link)
Great-West Lifeco Inc (Canada: Toronto)
Pargesa Holding S.A. (Switzerland: SWX)
Groupe Bruxelles Lambert S.A. (Belgium: Euronext Brussels)
Groupe Bruxelles owns stock interests in several European based companies:
At the right price, I would like to see the company sell its 27.8% interest in Pargesa, which controls 50% of GBL, and then use the proceeds to buyback stock. I don't believe the value of the Pargesa investment is reflected in the Power Corporation stock price.
In August 2017, the Mackenzie investment unit of IGM Financial (62.1% owned) acquired a 13.9% interest in China AMC, a Beijing based asset manager, for $638M. IGM Financial Inc. Completes Acquisition of 13.9% Interest in Market-Leading China Asset Management Co., Ltd.
Another subsidiary of Power Corporation of Canada, Power Energy Corporation, acquired a 55.7% stake in Lumenpulse (high performance LED solutions), for $638M in 2017. Website: Power Energy Corporation
Another company that appears in the organizational chart is Sagard Holdings, an alternative asset manager.
When looking at all of these companies, and their values, it is important to keep in mind that the market cap of Power Corporation of Canada is currently around C$15.08B at C$20.97 according to MarketWatch.
Share Buyback: April 17, 2019 - Power Corporation Announces Final Results of Substantial Issuer Bid (" Power Corporation of Canada . . .today announced that, under the Corporation's substantial issuer bid (the "PCC Offer"), it has taken up and is purchasing for cancellation 40,909,041 of its subordinate voting shares ("Shares") at a purchase price of C$33.00 per Share representing C$1.35 billion of its subordinate voting shares.")
Last Earnings Report (12/31/20): Power Corporation Reports Fourth Quarter and 2019 Financial Results and Dividend Increase
"Net earnings attributable to common shareholders were $401 million or $0.60 per share, compared with $478 million or $0.67 per share in 2018.
Adjusted net earnings attributable to common shareholders were $591 million or $0.89 per share, compared with $460 million or $0.65 per share in 2018."
Broker Reports:
Morningstar (1/6/20): 4 stars with a FV of C$33 with no moat.
S & P (4/14/20): 3 stars with a 12 month PT of C$26
The CAD priced shares closed last Friday at C$20.97.
I do not have access to any other report.
Sell and Buy Discussions: Item # 4 Sold 100 PWCDF at $22.03 (10/5/19 Post)(profit snapshot $110.05)-Item # 1 Bought 100 PWCDF at US$20.83 (5/29/19 Post); Item # 4.A. Sold 100 PWCDF at $23.56 (7/22/17)(profit snapshot= $141.95)-Item # 3.A. Bought 100 PWDCF at $22.14 (5/28/17 Post); Item # 1. Sold 400 POW:TO at C$31.05: Update For Portfolio Positioning And Management As Of 4/29/16 - South Gent | Seeking Alpha (USD Profit = $360.45); Item # 2 Sold 100 PWCDF at $28.07 (11/22/14 Post) (profit snapshot=+$210.03)-Bought Back Power Corporation Of Canada At $25.81 Item # 5 SOLD Taxable Accounts: 100 PWCDF at $28.83 (8/2/14 Post)(profit snapshot+$138.71)-Item # 4 Bought 100 PWCDF at $27.29 (7/12/14 Post)
Victory in PWCDF trades is defined as (1) selling at profit after (2) collecting one or more quarterly dividends and (3) buying the stock back at a lower price than the previous purchase without missing more than 2 dividend payments.
As discussed above, Power Corporation acquired that shares of Power Financial that it did not own, offering Power Financial shareholders 1.05 shares of Power Corporation for each share. The shares of Power Financial popped in response to the offer which fortunately prompted me, based on subsequent PWCDF price history, to sell my Power Financial Shares. I would have been much worse off now keeping the Power Financial shares and receiving 105 Power Corporation shares.
Power Financial Trades: Item # 1A. Sold 50 POFNF at US$27.04 (1/8/2020 Post)(profit snapshot = US$299.2); Item # 1.B. Sold 50 PWF:CA at C$35.14 (1/8/20 Post)(profit snapshot C$480); Item # 2 Bought 50 POFNF at US$20.96 (8/14/19 Post); Item # 5.A. Bought 50 PWF:CA at C$25.5 (1/23/19 Post); Item # 4.A. Bought 50 PWF:CA at C$27.73 (12/23/18 Post)(profit snapshot = C$161)-Item # 2.A. Sold 50 of 100 PWF:CA at C$30.99 (3/31/19 Post)
2. Small Ball:
A. Restarted VNQ Small Ball-Bought 2 at $56.48:
Sponsor's Website: Vanguard
Expense Ratio: .12%
Last Round-Trip: Item # 2.A. Sold 10 VNQ at $84.3 (2/27/19 Post)(profit snapshot = $98.73)-Item # 1.B. Bought 5 VNQ at $71.38 (1/23/19 Post)-Item # 3.A. Bought 5 VNQ at $77.71(11/14/18 Post)
Prior Trades: Item #2.A Sold 10 VNQ at $81.08 (7/5/18 Post); Item # 1.D Sold 10 VNQ at $79.89 and 10 at $80.06 (6/14/18 Post); Item # 3 Sold at $83.36 Update For Equity REIT Basket Strategy As Of 3/21/16 - South Gent | Seeking Alpha; Item # 3 Sold 10 VNQ at $80.74 Update For Equity REIT Basket Strategy As Of 11/5/15 - South Gent | Seeking Alpha
Distributions: The fund passes through its return of capital distributions received from owned REIT stocks.
Item #2.A Sold 10 VNQ at $81.08 (7/5/18 Post)(profit snapshot = $82.15)
Item # 1.D Sold 10 VNQ at $79.89 and 10 at $80.06 (6/14/18 Post)(profit snapshot = $52.2)
Item # 3 Sold 10 at $83.36-a Roth IRA Account: Update For Equity REIT Basket Strategy As Of 3/21/16 - South Gent | Seeking Alpha (profit snapshot = $72.63)
Item # 3 Sold 10 at $80.74: Update For Equity REIT Basket Strategy As Of 11/5/15 - South Gent | Seeking Alpha (profit snapshot = $65.39) That post contains a discussion on the reasons for owning REITs.
I highlighted the prices to make a point about a channel trading for a security that is stuck in that channel. There were no capital gain distributions that would account for the price stagnation.
Trading Profits: $371.1.
I prefer to own individual REIT stocks and simply view VNQ as a trading vehicle.
B. Added 10 SCM at $7.8; 2 at $6.26; 3 at $5.3; 5 at $7.53:
Closing Price 5/8/20: SCM $7.55 +$0.29 +3.99%
Website: Stellus Capital
SEC Filings
Management: External
2019 Annual Report (risk factor summary starts at page 31 and ends at page 59)
Industry Loan Classifications as of 12/31/19:
Net Asset Value Per Share History:
12/31/19: $14.14
12/31/18: $14.09
12/31/17: $13.81
12/31/16 $13.69
12/31/15: $13.19
12/31/14: $13.94
12/31/13: $14.54
November 2012: IPO at $15 ($14.46 after underwriters discount)
Average Cost Per Share = $ 9.35
Dividend: SCM recently abandoned paying its dividend monthly. Stellus Capital Investment Corporation Announces Transition of Dividend from Monthly to Quarterly and to Report Quarterly Results and Hold Conference Call ("Moving to a quarterly dividend payment schedule will allow the Company more time to better understand the impact that the COVID-19 pandemic has on our portfolio companies' liquidity and operations.")
The now defunct monthly rate was at $.1133 per share ($1.36 annually rounded).
The change from a monthly to quarterly payment schedule action , coupled with the ongoing recession, suggest that the new quarterly rate, when it is announced, will be a dividend cut.
Last Elimination: Item # 3 Eliminated SCM - Sold 50 at $13.72 (9/21/19 Post)(noting again that I was displeased with the 2019 second quarter report)
Last Buy Discussion: Item # 2.H. Restarted SCM: Bought 10 at $11.94; 10 at $10.85; 10 at $10.4 and 10 at $8.59 (3/14/20 Post) I discussed in that report the earnings report for the Q/E 12/31/19. Stellus Capital Investment Corporation Reports Results for its Fourth Fiscal Quarter and Year Ended December 31, 2019 (note: "Since December 31, 2019, we issued 332,591 shares under the At-the-Market ("ATM") Program, for gross proceeds of $4.8 million. The average per share offering price of shares issued in the ATM Program was $14.42.")
Other Trade Discussions:
Item # 1.B. Sold 32+ SCM at $14.22-Used Commission Free Trade (2/2/19 Post)(profit snapshot = $78.09); Item # 1.A. Sold Highest Cost Lot-50 Shares at $12.63 (5/3/18 Post)(profit snapshot = $34.24); Item 2.B. Sold 100 SCM at $14.23 (2/27/17 Post)(profit snapshot=$285.96); Item # 2 Sold 100 SCM at $13.02 (1/12/17 Post)(profit snapshot= $141.96)
Goal: Total Return in excess of the dividend payments which has been accomplished so far for this BDC stock
SCM Trading Profits to Date = $543.99
Purchase Restriction: Each purchase must reduce my average cost per share. The highest cost lot will be sold when and if it becomes profitable to do as a risk mitigation measure.
I also bought 10 shares of this BDC's exchange traded bond that matures in 2022 which I discuss in Item # 7 below.
C. Restarted Small Ball "Buying Program" in MFC-Bought 10 at $10.15; 2 at $9.3; 2 at $8.9:
Quote: Manulife Financial Corp. (MFC)
Closing Price Last Friday (5/8/20): MFC $12.27 +$0.56 +4.78%
Average Cost Per Share = $9.84
5 Year Chart:
MFC Analyst Estimates
MFC - Manulife Financial Corporation (USA) Key Developments | Reuters
MFC - Manulife Financial Corporation (USA) Profile | Reuters
Information as of 5/8/20:
Last Buy Discussions: Item # 2.A. Bought 10 MFC at $16.56 (8/21/19 Post); Item # 4.C. Bought 10 MFC at $17.64 (9/30/18 Post)
Dividend: Quarterly at C$.25
Last Ex Dividend Date: 2/24/20
Next Ex Dividend: Manulife declares common share dividend
Last Earnings Report (3/31/20): This report was released on 5/6.
Discussed at Manulife Q1 hurt by lower markets, Japan business volume (NYSE:MFC) | Seeking Alpha
Largest MFC Gain: My largest realized MFC gain to date occurred when I sold 100 shares at $18.28, booking a $481.06 profit.
D. Bought 100 MFC at $11.41:
I intend to trade this lot, probably holding through the upcoming ex dividend date, with any price over $12.5 thereafter likely triggering a sell.
E. Restarted Small Ball "Buying Program" in PBA-Bought 10 at $15.72; 5 at $14.7; 1 at $13.3; 1 at $11.9 :
Closing Price 5/8/20: PBA $22.85 +$0.60 +2.70%
Website: Pembina - Home
Last Elimination: Item # 2 Sold 100 PBA at $38.69 (1/18/20)(profit snapshot= $435.78)-Item # 1 Bought 100 PBA at $34.34(12/11/19 Post)
Average Cost Per Share: $14.85
Pembina - Stock & Dividend Information
Last Ex Dividend: 4/23/20
Next Ex Dividend: On 5/7/2020, the company declared its regular monthly distribution of C$.21 per share. "For shareholders receiving their common share dividends in U.S. funds, the May 2020 cash dividend is expected to be approximately U.S. $0.1487 per share (before deduction of any applicable Canadian withholding tax) based on a currency exchange rate of 0.7080. The actual U.S. dollar dividend will depend on the Canadian/U.S. dollar exchange rate on the payment date and will be subject to applicable withholding taxes. Pembina Pipeline Corporation Declares Common Share Dividend
Recent News Releases: Pembina Announces New C$800M Unsecured Credit Facility, Declares Dividends
Pembina Pipeline Corporation's Jordan Cove LNG Project Receives Federal Approval
Pembina Pipeline Takes Action to Protect Stakeholders and Significantly Reduces 2020 Capital Spending in Response to the Recent Decline in Global Energy Prices ("$900 million to $1.1 billion overall reduction to the Company's 2020 capital spending plans." or about 40% to 50% of prior announced capital budget; about 85% 0f 2019 adjusted EBITA supported by long term fee based contracts which includes 62% from "cost of services or take-or-pay contracts" that do not depend on "volume or price risk.")
5 Year Chart:
"Pembina's common share dividend of $0.21 per share per month is more than covered by fee-based cash flows, meaning the Company is not reliant on the portion of its business with direct commodity price exposure to pay the current dividend. In 2019, Pembina's common share dividend represented only 73 percent of fee-based distributable cash flow, or an all-in dividend payout ratio of 54 percent, providing ample room between the current dividend and the cash flow being generated."
F. Bought 5 SLG at $48.41:
Website: SL Green Realty- NYC’s Largest Commercial Landlord
SLG SEC Filings
This REIT owns some prime NYC real estate. SL Green | Properties
The pandemic has negatively impacted NYC property prices and the stock.
SLG had an agreement to sell 220 East 42nd Street for total consideration of $815.0 million. On 3/24/20, SLG announced that the sell would not go forward since the buyer's financing was pulled by the banks. SEC Form 8-K The company had intended to use the net proceeds to fund its share buybacks. Since the transaction fell through, SLG suspended its share repurchase program.
I decided to buy the common shares last Friday after being unsuccessful buying the senior unsecured bond.
Since I had already planned to discuss the purchase of SLG's equity preferred stock, SLGPRI, in this post (see Item # 4.A.), I decided to go ahead and mention the buy of the common.
Dividends: Monthly at $.295 per share ($3.54 annually).
SLG recently changed its common share dividend payments from quarterly to monthly. SL Green Realty Corp. Announces Common and Preferred Stock Dividends
Last Ex Dividend: 4/29/20
SL Green Realty Corp. Announces Common Stock Dividend (4/24/20)
Dividend Yield at $48.41 = 7.31%
5 Year Chart:
5 Year Financials:
Recent News:
SL Green, National Pension Service of Korea and Hines Form Joint Venture Partnership at One Madison Avenue (5/4/20)
SL Green Announces Acquisition of 126-132 Nassau Street (3/2/20)
SL Green Announces Sale of 315 West 33rd Street and adjacent undeveloped parcel (2/18/20) This transaction closed on 3/31/20 for a gross valuation of $446.5M.
I have periodically traded the common stock.
Current Position: 5 Shares
Maximum Position: 50 Shares
Purchase Restriction: Small Ball Rule
Closing Price Last Friday: SUNS $12.13 +$0.80 +7.06%
The stock responded positively to the first quarter earnings report released after the close last Thursday.
SEC Filings
2019 Annual Report (risk factor summary starts at page 27 and ends at page 60; list of investments starts at page 92)
Management: External
Current Position: 13 shares
COVID-19 Letter to Shareholders: Solar Senior Capital Ltd. Issues Letter to Stakeholders (worth reading IMO)
5 Year Chart:
 |
| 52 week Price Performance as of 5/8/20 = -33.99% |
The dividend rate was reduced to $.10 per share effective for the next payment.
Average Cost Per Share: $9.81
Dividend Yield at Average Cost = 12.23% (at the new reduced annual rate of $1.2 per share, paid monthly at $.10, and assuming no change in that rate)
Net Asset Value per share history:
3/31/20: $14.59
12/31/19: $16.32 Form 10-K at page 67
12/31/18: $16.3 Form 10-K at p. 81
12/31/17: $16.84 "
12/31/16: $16.8 "
12/31/15: $16.33 "
12/31/14: $17.65 FORM 10-K at page 55
12/31/13: $18.04 "
12/13/12: $18.33 "
12/31/11: $18.15 "
IPO 2/2011 at $20 ($18.6 to SUNS before its expenses)
Discount to $14.59 NAV Per Share at $9.81 TC = -32.27%
Last Earnings Report (Q/E. 3/31/20):
"At March 31, 2020, net asset value (NAV) was $14.59 per share, a decline of approximately 10.6% from year end 2019 driven primarily by unrealized mark-to-market depreciation. At March 31, 2020, 100% of Solar Senior’s portfolio was performing."
Solar Senior Capital Ltd. Announces Quarter Ended March 31, 2020 Financial Results; Reports Net Investment Income of $0.35 Per Share
Last Sell Discussions: Item # 4.C. Eliminated SUNS-Sold 62+ at $17.34-Used Commission Free Trade (5/8/19 Post)(profit snapshot = $91.16)
Item # 2.B. Sold Highest Cost SUNS Lot in Fidelity Account and Item #2.C. Eliminated SUNS in Schwab Account-Sold 112+ at $16.72 (3/27/19 Post)(profit snapshots = $30.98)
Item # 2.B. Sold at $17.45 on ex-dividend date (3/1/17 Post)(profit snapshot = $117.48)- Item # 1 Bought 50 SUNS at $15.06-Update For Portfolio Management And Positioning As Of 10/16/15 - South Gent | Seeking Alpha
Item #1C. Bought 10 SUNS at $15.78, 10 at $15.68 and 10 at $15.3-Used Commission Free Trades (12/12/18 Post)(discussed 2018 third quarter report in that post);
Last Public Share Offering: 4M shares at $16.4 + greenshoe (9/16)
3. Added 100 FIE:CA at C$5.05 and 100 at C$5.47 (C$ 1 commission per trade):
Sponsor's Website: iShares Canadian Financial Monthly Income ETF
Closing Price 5/8/20: FIE.TO C$5.51 +C$0.08 +1.47%
Top 10 Holdings:
Last Buy Discussion: Item # 1 Bought 100 FIE:CA at C$6.74 (9/21/19 Post)
Dividend: Monthly at C$.04 (C$.48 annually)
Prior Round-Trips: Item # 5. Sold 300 FIE:CA at C$7.64 (11/26/17 Post)(profit snapshot = C$160); Item # 5. Sold 300 FIE:CA at C$7.64 (11/26/17 Post) (profit snapshot=C$35)(contains snapshots of prior round-trip trades= USD$391.32 for 1500 shares and USD$58.07 for 300 shares; C$166 for 200 shares); Item # 2.C. Sold 100 FIE:CA at C$7.33 (12/11/19 Post)(profit snapshot = C$3) Some of the profit snapshots are in USDs since the broker converted the CAD profit into USDs.
FIE:CA Profits Realized to Date:
USD 449.39
C$ 204
Maximum Position: 1500 Shares
Strategy: Frequent Trading in a relatively narrow price channel which recently expanded.
A. Restarted SLGPRI-Bought 10 SLGPRI at $20.75; 10 at $19:
Quote: SL Green Realty Corp. 6.5% Preferred Series I Overview
Closing Price 5/9/20: SLG-PI +$25.04 +$0.39 +1.58%
Average Cost Per Share: $19.86
Yield at Average Cost: 8.18%
Investment Category: Equity REIT Common and Preferred Stock Basket Strategy
Sub-Category:Advantages and Disadvantages of Equity REIT Cumulative Equity Preferred Stocks
Prospectus
Par Value: $25
Stopper Clause: Yes, see page S-15
Coupon: 6.5% paid on a $25 par value
Dividends: Cumulative; Quarterly at $.40625 per share (annually at $1.625)
Last Ex Dividend SLGPRI: 3/30/20
Issuer Call Option: At par at anytime
Credit Ratings: Ba1/BB
Change of Control Conversion Option: None
$815 million Manhattan office-tower deal collapses - MarketWatch SLG had a contract to sell this building but the buyer's financing was pulled on 3/24/2020.
Only Prior Round Trip: Item # 5 Sold 50 SLGPRI at $23.6 (4/3/2014 Post)-Item # 4 Bought 50 SLGPRI at $22.69 (11/6/2013 Post)
B. Added 10 MNRPRC at $20.46; 10 at $15.31; 10 at $18:
Closing Price 5/8/20: MNR-PC $24.84 +$0.10 +0.40%
This brings me up to 80 shares. The other 50 shares were bought at $23.12: Item # 3.B. Bought 50 MNRPRC at $23.12 (12/16/18 Post)
Average Cost Per Share: $21.23
Yield at $21.23 = 7.21%
Next Ex Dividend Date: 5/14/20
I may pare the highest cost lot after the ex dividend date when and if the price goes over $25.
Description: Prospectus
Issuer: Monmouth Real Estate Investment Corp. Cl A (MNR)
Issuer Website: Monmouth Real Estate Investment
Par Value: $25
Dividends: Quarterly, non-qualified and cumulative
Next Ex Dividend Date: 5/14/20
Optional Call: On or after 9/15/21
5. Short Term Investment Grade Corporates As an Alternative to Money Markets:
A. Bought 2 AON 5% SU Bonds Maturing on 9/30/2020:
Issuer: Aon PLC (AON)
AON | Aon PLC Analyst Estimates
Aon Reports Fourth Quarter and Full Year 2019 Results
Aon Reports First Quarter 2020 Results (net income was "$773 million, or $3.29 per share, compared to $659 million, or $2.70 per share, in the prior year period.")
Aon to Combine with Willis Towers Watson To Accelerate Innovation on Behalf of Clients
AON is an insurance broker.
Credit Ratings:
Bought at a Total Cost of 99.9
YTM at Total Cost = 5.039%
For a bond purchase, this is what amounts to a gift:
B. Bought 1 KeyCorp 2.9% SU Maturing on 9/15/20:
FINRA Page: Bond Detail
Issuer: KeyCorp (KEY)
KeyCorp Reports Fourth Quarter 2019 Net Income Of $439 Million, Or $.45 Per Diluted Common Share
2020 First Quarter Earnings Press Release As with other banks, KEY added a substantial amount to its loan loss reserve. The amount is not based on actual loan losses during the first quarter, but loan losses that are currently expected due to the ongoing recession.
Credit Ratings:
YTM at TC = 3.266%
Current Yield at TC = 2.9342%
6. Intermediate Term Bond Ladder Basket Strategy:
A. Bought 1 Ventas Realty L.P. 3.125% SU Maturing on 6/15/23 (barely outside 3 year period for short term bond classification):
FINRA Page: Bonds Detail (prospectus linked)
Bought at a Total Cost of 98.98 (includes $1 per bond commission)
YTM at 98.98 = 3.467%
Current Yield at TC = 3.1572%
Issuer: Operating entity for Ventas Inc. (VTR) who guarantees the notes
Last Earnings Report: SEC Filed Press Release
Credit Ratings:
7. Exchange Traded Bonds:
I discuss below the purchase of a BDC exchange traded baby bonds.
While BDC baby bonds provide a much lower yield than the common stocks, the cash interest payments made by the bonds and the return of my capital investment are "safer".
Many of the BDC exchange traded bonds are not rated by a credit agency which is the case for the one discussed below issued by Stellus Capital Investment (SCA), a mini cap BDC.
I would classify it as a junk bond.
One reason for that classification is that most of SCA's net investment income is paid out in cash to the common shareholders. There is no cash cushion.
Other reasons include the riskiness of the loans made by the BDCs; the illiquidity of those loans; and the BDCs' leverage.
A. Bought 10 SCA at $19.1:
Issuer: Stellus Capital Investment Corp. (SCM)-A BDC
Closing Price 5/8/22: SCA $21.98 +$0.95 +4.52%
SCM 2019 Annual Report
Category: Exchange Traded Baby Bonds
Security: Prospectus
Par Value: $25
Maturity Date: 9/15/22
Optional Call: At par on or after 9/15/19
Capital Structure Placement: Senior unsecured bond
Interest: Quarterly
Last Ex Interest Date:
Trades Flat
Current Yield at $19.1= 7.53%
The yield-to-maturity (YTM), which assumes the issuer will pay the par value at maturity, will be substantially higher than the current yield given the discount to par value.
A rough YTM estimate would be around 19.5% at $19.1. The YTM number is an annual total return that, once again, assumes SCM will pay off the bond at maturity and will make all interest payments. The share gain would be about 30.89% + the interest payments.
I view it as highly unlikely that this issuer will redeem prior to the maturity date.
Stellus will release its quarterly report next Monday. Stellus Capital Investment Corporation Announces Transition of Dividend from Monthly to Quarterly and to Report Quarterly Results and Hold Conference Call
B. Bought and Sold 20 NEWTI:
Quote: NEWTI | Newtek Business Services Corp. 6.25% Notes Due 2023 Overview
Issuer: Newtek Business Services Corp. (NEWT)
Prospectus
Profit Snapshot: +$14.68
For my 2 NEWTI lot purchases, I entered two 10 share limit orders below the then existing bid prices, and both filled during the day.
Ownership would have lasted longer but I was killing too many of my brain cells trying to figure out NEWT's earnings report released after the close on 5/7. Newtek Business Services Corp. Reports First Quarter 2020 Financial Results (note the net investment loss) I need to preserve as many of my remaining functioning brain cells as possible.
The brain short circuits resulting from a review of that report also resulted in selling my 5 shares of NEWT bought in early April for close to a 50% gain:
 |
| 5 shares NEWT +$24.07 |
Quote: Saratoga Investment Corp. 6.25% Notes 2025 Overview
Prospectus
Profit Snapshot: $11.29
Issuer: Saratoga Investment Corp. (SAR) Based on my discussion about this BDC above, I no longer wanted to assume the credit risk of its baby bond. One consideration in that judgment is that this baby bond does not mature until 8/31/25.
I am unlikely to buy any security issued by this company going forward.
I will look for an opportunity to sell my existing 35 share common stock position, last discussed here: Item # 2.F. (3/21/20 Post) My average total cost per share is at $17.65:
Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members.
The Governor of Tennessee did not extend a stay-at-home order past April 30. While Nashville still has one in place, I live in a neighboring county called Williamson that is the home of three AAA rated municipal bond issuers (Cities of Brentwood and Franklin and Williamson County)
ReplyDeleteI drove around today in Brentwood. It looked like a normal Saturday. If I had no knowledge of the pandemic, I would not know anything was abnormal. The shops and restaurants were open and parking lots were full.
People in restaurants were not wearing masks. Maybe they have not figured out yet how to eat when something is covering their mouth. An Old Geezer might try cramming the food through the ear canal but I am not there---yet.
Tennessee scores an F on a website that tracks social distancing.
https://unacast-2019.webflow.io/covid19/social-distancing-scoreboard
So far, the state has escaped the worst of the pandemic.
I thought that I would make a note the number of confirmed cases in Williamson County as of today. The total is reported at 441 with 10 deaths.
https://www.tn.gov/health/cedep/ncov.html
Based on what I observed today, my experiment will be to see whether the reopenings result in an infection spike.
Tennessee's Governor called the reopening an intelligent and safe one. Time will tell.
I would anticipate that any social distancing and mask wearing will tail off pretty quick.
I expect all the caution measures to wear off quickly. This "slow to open" is not consistent with past human behavior.
DeleteConstraints will only be unemployment (which is paying many more than their jobs.)
I will be ears open for info on how infections spike. The infections are not that significant. The # dead or disabled by it, are. I will keep my ears open and free from burritos, even if it means taking off my mask to eat.
FG has a technical chart that gets my attention. Short term there's a trading range. We're back near the top of it. So I will likely curtail my Monday to only long term down beaten value buys and wait for another leg to buy the tending growth, and the indices.
FG and comments mention a few stocks that seem like ideas to explore. So that's my mission.
Now that I've opened up my First Foundation account. (I've got to do the schwab one still.)
I have appeared to figure out Skype. It's better than zoom because it's unlimited, but they kill their business with impossible to find instructions and convolution. For group chats (which means video, who'd have guessed) the page has all the reasons you would want to group chat. But no link to instructions anywhere. This is microsoft's (bought by.)
I've stopped watching Chris C.'s. He fence sits and reports whatever the last week's feel was. (IN his service might be better.)
SPX is supposedly above 20 month moving average. That's bullish. But of course can change. I still have no idea how to find a chart with 20 mo mas on them.
Another sunny & cheery day in the stock market.
ReplyDeleteHard to chase here with popular stocks up over 1%, it's not a small new height to buy. But these are where the trend is.
Looked at a wide variety over the weekend. Not much is appealing, even if it's lower.
Disney rose to "kind of" land. The brand will survive. Not down at bargain prices, but hasn't rallied that much. I put in order for 1 at 107. I'd like 1 KRE too. Didn't put in yet.
Stuff with no earnings rallied like crazy in the last month. CHGG up 82%. Docu up 50+%.
Spent a lot of time on GD. Since I have LMT it's a little repetitive. It's down since early 2018. I haven't read why yet, but it had cash flow reductions. NOW it's much improved. 2019 900M, now 5000K. Debt is fine. Also not that rallied off lows. Guesses are that it's low because it's private jet segment is down. But my guess is that MORE private jets will be wanted in and after this virus event. Gapped down on recent earnings miss. So I'll watch, but didn't jump in.
Medical REITs (OHI, MPW, VTR, WELL) seem like well worth considering.
From one of the links, I have this note saved on resistance.
"""“We’re right up to the 50% price retracement at 2796,” he explained. “This 61% which is another key level is at 2939. So, altogether, this is your zone of interest where a possible failure, if this a bear market rally, might occur.”""
I had thought market had passed the 61% magic number already. But is right at it.
Land: Regional bank stocks continue to flash danger. The message being sent by KRE is simply not consistent with the one being sent by the major market averages.
DeleteRegional banks started to roll over in price in 2006, long before the major indexes topped out in October 2007. While this time may be different, the widespread weakness in that sector, with many quality regional banks down 30% to 60% from their February highs, may be the canary in the coal mine.
After selling some First Hawaiian (FHB), I have started to buy some back, but only in small lots. By small, I mean 1 or 2 shares. I bought a few today.
First Hawaiian (FHB)
$15.92 -$0.595 -3.60%
52 WEEK RANGE $14.19 - $31.25
YIELD 6.53%
EX-DIVIDEND DATE May 22, 2020
I lightened up in February.
Item # 1
A. Pared FHB-Sold 40 in Schwab Account at $29.65 and 5 at $30.81 and
B. Pared FHB-Sold 10 in Fidelity Account at $29.65 and 10 at $30.02
https://tennesseeindependent.blogspot.com/2020/02/cjref-eaf-fhb-irm-rdsb.html
This is a standard trading technique that I use. I may have to wait awhile to sell the remaining highest cost shares.
It is important to recognize that we have no control over what is happening. I can only control how I react.
The U.S. is going to reopen businesses without adequate testing and contact tracing.
The assumption in the market is that infections, serious illnesses and deaths will not spike to a level that will cause widespread business shutdowns or that some scientific breakthrough will arrive to mitigate or eliminate that risk.
The possible second wave of infections is out-of-sight, out-of-mind. The odds given to the second wave being far worse the current one is given a zero probability. The second wave of the Spanish Flu was the real killer machine.
This blue sky scenario may happen, but I do not view it as the most probable one based on what I know now and can reasonably predict based on what I know.
Consequently, it is my opinion that investors are overly optimistic about the near future, both in the duration of the recession, its depth and impact on corporate earnings, and in the speed and strength of a recovery.
Given my preservation of capital objective, I am not going to be sticking my neck out now and will simply wait for an opportunity to buy at much lower prices and/or more clarity that blue sky scenario is actually going to happen.
It may be June or even later before we know whether the reopening push is successful. As to the second wave, we may not know much until October.
I do agree with those who argue that a balance needs to be struck soon between reopening and safety. Otherwise, a continuation of shutdowns into the summer and fall months could trigger another Great Depression with widespread bank failures and bankruptcies.
We do need to figure out opening up. Of course if we had a leader and therefore had testing, this would be possible in a natural much safer way.
ReplyDeleteKRE and banks in general as possible signals - useful to think about.
I am better off if the market keeps climbing. Then I can sell out some higher shares bought too soon. That will maximize the chance of another real correction that will correct valuations. It's possible this will be the recovery phase that has happened before. (I'm not saying it will happen or will be a recovery phase.)
This NYTimes opinion piece gives info about the patterns happening with reopening. The charts in particular and rates still climbing. (Assuming the models took into account changes in testing rates.)
https://www.nytimes.com/interactive/2020/05/06/opinion/coronavirus-deaths-statistics.html?action=click&module=Opinion&pgtype=Homepage
This market would struggle on a playground... trying to use even the small slide.
ReplyDelete(Not a very involved or interesting day for me in the market. Fixing my toilet instead.)
Hi
ReplyDeleteSG
I see the fed is going to Buy up to 750 Bil of iNV grade and previous IV grade bonds; any thoughts on a trade of HYG or ANGL?
thanks
G: I bought 13 shares of ANGL today which brings me up to 20 shares. I may discuss the purchase in my next post.
DeleteI am very wary of buying junk bonds during a recession. My general opinion is that their yields do not properly compensate for their risks. And, if the recession lasts longer than the Stock Jocks currently contemplate, and stocks become more volatile with a downside bias, then junk bonds are going to crater. Concerns about credit risks expand in those scenarios and the only way to compensate for perceived and/or actual increased credit risks is to lower prices.
I bought a few ANGL shares today based on the FED's decision to include fallen angels in its bond ETF buying.
HYG will have some fallen angel bonds in its portfolio but its scope is much broader and the overall credit quality will be lower than ANGL.
HYG has a 34.63% weighting in B rated bonds and 9.92% in CCC.
Click "credit quality" tab under "Exposure Breakdowns"
https://www.ishares.com/us/products/239565/ishares-iboxx-high-yield-corporate-bond-etf
ANGL claims that it has more than 90% in BB rated:
https://www.businesswire.com/news/home/20200508005061/en/?mod=article_inline
One reason is that the new fallen angels generally go to BB+ after losing their investment grade status. And, there are a lot of them now.
The slide today was probably caused by Dr. Fauci's testimony.
ReplyDeletehttps://www.reuters.com/article/us-health-coronavirus-usa/premature-end-to-u-s-state-lockdowns-could-cause-needless-death-fauci-tells-senators-idUSKBN22O1Y7
He threw some cold water on Trump's everything is going really well spin.
S&P 500 Index 2,870.12 -60.20 -2.05%
Regional bank stocks continue to telegraph persistent and major problems in the U.S. economy.
SPDR S&P Regional Banking ETF
$33.19 -$1.79 -5.12%
https://www.marketwatch.com/investing/fund/KRE
Equity REITs performed significantly worse than SPX as well.
Vanguard Real Estate ETF
$70.54 -$3.36 -4.55%
https://www.marketwatch.com/investing/fund/vnq
U.S. treasuries gained in price and fell in yield:
iShares 7-10 Year Treasury Bond ETF
$121.59 +$0.40 +0.33%
https://www.marketwatch.com/investing/fund/ief
iShares 20+ Year Treasury Bond ETF
$164.37 +$1.67 +1.03%
https://www.marketwatch.com/investing/fund/tlt
Investment grade corporate bond ETFs rose as well.
iShares Investment Grade Corporate Bond ETF
$126.76 +$1.21 +0.96%
https://www.marketwatch.com/investing/fund/lqd
The VIX spiked higher:
CBOE Volatility Index 33.04 +5.47 +19.84%
The market is in an Unstable VIX Pattern as defined in my VIX Asset Allocation Model.
Precious metals were up. DXY declined slightly.
U.S. Dollar Index (DXY)
https://www.marketwatch.com/investing/index/dxy?mod=home-page
SPDR Gold Shares $160.04 +$0.62 +0.39%
https://www.marketwatch.com/investing/fund/gld
Karen Firestone added the bond fund as a reason investors would sell & move to bonds. Seems like an odd reason to me. Also technicals.
ReplyDeleteI'm tempted to say I was prescient. Only I don't know if this is a short term top. Like usual, when I decide it can't go down with conviction - I've spotted the top. This time though I didn't buy. So not 100% sure on my contrarian prediction (to market move.)
Maybe another brief pop and I'll be able to get more out.
It did move 2-4 - well, 5% up from where I said, and looks like it's now going to peter out a bit.
I suspect it will settle in a slightly lower trading range. That will make investors more comfortable, as we all wait to find out the data that will tell us all how the openings go.
I can now picture another leg down after that. I hadn't been able to picture it before. But that's too far out to judge which way it will break out.
The bottom will be put in when there's enough data to tell how it's going to pan out. Then there will be green shoots. Instead of the excitement of green shoot spotting that is a popular sport now.
Well, that's my guess.
I find your observation on regional bank stocks important data.
Stockcharts puts SPX as still under 200 dMA, and over 50 dMA. It looks like SPX is in a trading range.
https://stockcharts.com/h-sc/ui?s=$SPX
SL Green Realty Corp. (SLG)
ReplyDelete$ 39.93 -$1.68 -3.99%
Last Updated: May 13, 2020 at 9:53 a.m. EDT
https://www.marketwatch.com/investing/stock/slg
I discuss buying 5 SLG shares in this post. My timing was not optimal.
I have not seen any news released by SLG that would account for the rapid share price decline.
Instead, I would attribute the decline to a story about the future, created by investors, which has become a consensus opinion.
The story is that COVID-19 will fundamentally alter the demand for office space. Companies will increasingly have their employees work from home and will not renew their leases, either moving to a no office space model (except possibly for a leased access to a meeting room used occasionally) or less office space. That trend would then leave a lot of vacant space and will cause property values to go down.
As with many stories that investors tell themselves, this particular story has a factual predicate, at least in the short term. Many businesses located in Manhattan are telling their employees to work from home. The question is whether that will continue when and if COVID-19 becomes a past memory rather than a current reality.
I am adding to SLG in 1 share lots, using the small ball purchase restriction. I bought 1 share today at $40.
S&P 500 Index 2,820.00 -50.12 -1.75%
ReplyDeletePowell added to the angst which started yesterday with Dr. Fauci's testimony. Powell expressed the view that the economy may suffer permanent damage without additional stimulus.
Possibly adding to the bad FED vibe was a report that Abbott's quick test for COVID-19 has serious shortcomings.
https://www.cnbc.com/2020/05/13/abbotts-rapid-coronavirus-test-misses-positive-cases-raising-questions-nyu-study-finds.html
While Abbott disagrees, I would expect the company to claim otherwise. More independent tests of efficacy are necessary. Too many tests are being rolled out without adequate testing.
A test that is less than 90% accurate is not going to cut it IMO.
Powell and other FED members will not be using negative interest rates to combat the slowdown.
https://www.marketwatch.com/story/powell-rejects-using-negative-rates-as-a-policy-tool-2020-05-13
Donald disagrees and wants the FED to go negative. I am not sure why anyone is still paying attention to any opinion expressed by Donald.
Perhaps some reporter can ask the Duck about whether negative rates have helped Europe and Japan.
David Tepper asserted that the U.S. stock market was the second most overvalued that he had seen in his career.
https://www.cnbc.com/2020/05/13/david-tepper-says-this-is-the-second-most-overvalued-stock-market-hes-ever-seen-behind-only-99.html
Stanley Druckenmiller did not help matters by saying that the risk/reward is the worst that he has ever seen.
https://www.marketwatch.com/story/why-druckenmiller-says-the-risk-reward-of-investing-in-stocks-has-never-been-worse-2020-05-13
I have been saying much the same here. I am not willing to assume now that there will be a robust recovery in the second half, nor am I willing to pretend that was is happening now does not exist.
The Cleveland Fed President Loretta Mester sees some improvement in the second half but the recovery may be slow. She added that an "almost equally probabilistic outcome is much more dire than that.”
https://www.cnbc.com/2020/05/13/feds-mester-sees-a-recovery-or-a-much-more-dire-scenario-as-equally-possible.html
I would agree with that general assessment. The "more dire" scenarios would include those where the virus interferes with the reopening push, either by accelerating infections resulting in deaths or by coming back next Fall in a more virulent form.
CBOE Volatility Index 35.28 +2.24 +6.78%
The regional bank ETF continues to flash a message that economic conditions are not getting back to pre-pandemic levels anytime soon.
SPDR S&P Regional Banking ETF
$31.40 -$1.79 -5.39%
https://www.marketwatch.com/investing/fund/KRE
The message conveyed by bank stock prices is that loan losses will accelerate and will be substantial. And what economic scenario is consistent with that result? It would be the expected result in an economy that is weak and likely to remain weak for an extended period. It is not consistent with the blue sky scenario that everything will be just fine in a few months.
As with any message flashed by price, the underlying assumption about the future, which is causing a major bear market in bank stocks, may be wrong.
Thank you. That was helpful. I hadn't figured out what was driving the day. (Away from market, had other commitments).
DeleteSouth Gent,
ReplyDeleteGlancing at S&P500 2 year chart Tepper was right about cash back in December 2018, but the timing was either a month too late or a year too early.
http://nbr.com/2018/12/20/david-tepper-fed-is-done-supporting-stock-prices-so-cash-is-not-so-bad-as-an-investment-now/
Druckenmiller was bearish in December 2018 and bullish in January 2020.
https://www.bnnbloomberg.ca/investing/video/druckenmiller-we-are-in-a-global-bear-market~1567568
https://www.cnbc.com/video/2020/01/17/hedge-fund-manager-stanley-druckenmiller-says-hes-bullish-in-the-intermediate-term.html
Many of the money managers have their own agenda when they go for an interview. And they will change their view without advance notice.
Y2000: That was a good reminder to be cautious about money manager comments, and their agendas.
DeleteI did some light buying in the morning and bought a few shares of a double short ETF near the close.
ReplyDeleteI did not see any reason for the 800+ DJIA intraday swing. Consequently, I suspect that the down, then up swing was mostly due to program trading, short covering and other non-fundamental market dynamics.
By light buying, I am referring to scatter purchases in the 1 to 5 share range, scatter shot buys mostly in really smashed up regional bank stocks and CEFs.
I added a new exchange traded bond. I sold 2 out of 12 $1000 par value 2.95 % American Electric Power senior unsecured bonds maturing in 2022.
My 2 bonds were the only trade today, selling at 103.979. At that price, the YTM is 1.209% to the buyer before their brokerage commission.
http://finra-markets.morningstar.com/BondCenter/BondDetail.jsp?ticker=C585149&symbol=AEP3938366
That YTM is one reason why stocks find buying interest after a dip. There is nowhere else to go.
Banks started the upswing today but flattened out with the usual movers and shakers taking over in the afternoon.
SPDR S&P Regional Banking ETF
$32.40 $1.00 +3.18%
https://www.marketwatch.com/investing/fund/kre
SLG bounced around today:
SL Green Realty Corp.
$39.39 +$1.19 +3.12%
DAY RANGE $35.16 - $40.01
https://www.marketwatch.com/investing/stock/slg
With a continuation of its recent rate of descent, I though that I would be up to about 20 shares, buying in 1 or 2 share lots, when the stock hit zero. I bought 1 today at $35.5.
Fed’s balance sheet nears $7 trillion mark
https://www.marketwatch.com/story/feds-balance-sheet-nears-7-trillion-mark-2020-05-14?mod=mw_latestnews
Gold likes the idea of creating USDs measured in tons to buy up treasury debt and mortgage backed securities. Eventually, the currency is turned into confetti.
Gold Continuous Contract
$1,738.30 +$21.90 +1.28% (per ounce)
SPDR Gold Shares
$163.01 $1.43 +0.89%
https://www.marketwatch.com/investing/fund/gld
Several said 2750 is bottom of the training range.
DeleteThat fits with it being programming trading. After a few days down, short covering happens.
It went down around 5% and headed for 7%, in 3 days.
I can see why it's be a good time to buy a few shares. I didn't think of it.
This is a split market. Favorites are still flying. Can't be bought into comfortably.
Land: The M2 money supply is moving skyward as shown in this chart. About 2 trillion has been added since mid-February.
Deletehttps://fred.stlouisfed.org/series/M2
The massive FED injections of liquidity have to go somewhere since the new money is not needed in the real economy.
I feel like a toddler reading this. M2 money is the Fed's buying up everything and anything, even junk.
DeleteWhy isn't the liquidity going into the economy and getting used?
Why is the Fed buying when it's not needed. (Some is, but less than this.)?
So with that money banks (I assume get the Fed funds) need to buy stocks, and are drinking up the favorites?
Land: The new money is mostly invested rather than used in the real economy.
DeleteSee Ray Dalio's comments
https://www.linkedin.com/pulse/world-has-gone-mad-system-broken-ray-dalio/
The Fed's actions also reduce interest rates and effectively make money free after adjustments for inflation (temporarily low due to last month's collapse in energy prices now reversing) and the adjustment for the after tax cost. That makes bonds more unattractive and causes money to flow into stocks and other nonproductive assets creating wealth for those invested in those assets while penalizing those dependent on mostly credit risk free instruments like CDs, savings accounts, money market funds, treasury bills, etc.
Excess liquidity created by QE, plus ZIRP, also allows money to flow to less creditworthy businesses and permits creditworthy investors to finance debt at lower interest rates, penalizing bond owners like myself since the reinvestment options for proceeds are nil and none in an interest rate suppression scheme that flows from QE/ZIRP.
Thanks! The article helped too.
DeleteBasically, businesses aren't looking to actively expand (into this nutty environment or even in Nov 2019 when he wrote it), so the liquidity isn't flowing into heating up the economy. So it's winding up being invested in passive investments.
I don't known why it wasn't being invested in 2019 into business expansion? Why stagnate one's business?
Stocks are the only gain for divs and growth. He describes tech having a good reputation, and people's imaginations being the guide. He's basically describing something of a bubble, particularly in new technology benefiting companies. That seemed astute. I hadn't thought of it that way.
His description, and he would know, of companies so flooded with investment funds that they don't want more, is noticeable too.
That does explain the constant sense of the market being bought into, without a lot of reasoning on valuations.
The killing of bond opportunities creates such an imbalance. My excitement is a 1.75% bank account. I doubt that beats (real) inflation.
I don't know what's bothering me more... that I haven't found my way into the market with most of the rest of my funds...
ReplyDeleteOr that the intraday swings in 1 hour time slots are $2 on the SnP. On the day, $6.
Land: SPX has been in a trading range since mid-April, mostly bouncing up and down between 2800 to 2900. Really bad news about the economy has not caused a significant break in that range.
DeleteThe Stock Jocks are in a wait and see mode IMO. The issues are (1) whether the current reopening push will lead to clearly intolerable serious illnesses and deaths which causes another round of widespread shutdowns and (2) whether the virus returns next Fall in a more virulent form. If either of those events occur, then ignoring bad news is not going to be a rational option.
Donald wants the shutdowns to end and that is going to happen, though some of the blue states will likely be more cautious about reopening than the red states and will be more likely to have widespread tracing and contact tracing in place to identify emerging hot spots.
I doubt that the virus will cooperate, but we will know soon enough.
Remember that the Diamond Princess infections started after I passenger boarded the cruise ship. We have learned that any enclosed space with a lot of people, including nursing homes, meat packing plants, church gatherings, parties, and prisons, results in widespread infections.
I read earlier this week that 1 person in a choir infected 52 persons.
https://www.livescience.com/covid-19-superspreader-singing.html
As to doing something in the market, it is easy to do something when it is not important. So buying and selling a few shares of this and that is easy to do since it means nothing to my financial condition.
I am not going to do anything meaningful until I have absolute clarity on what will happen with this virus or the market plummets down like it did in March.
"wait and see mode"
DeleteThat does seem to describe it. It's not like valuations can be calculated.
"not going to do anything meaningful until have absolute clarity"
That's reassuring for having the patience that's needed here.
That fits with your situation. If you had a longer horizon (10-15 yrs) and needed growth... are there any other approaches that you'd be considering doing here?
Land: I am just disgusted with my options for cash now; and it hard for me to think about taking risks with that mind set permeating into every remaining and functioning brain cell.
DeleteThere will come a time when the market tanks and there is no recovery to pre-collapse highs and beyond. I have seen that kind of market and expect to see another one where both major asset classes fail.
The long term bear market in bonds will return. The last one lasted for about 32 years (1950 to 1982). Conditions are ripe for one given negative nominal interest rates and negative nominal rates adjusted for inflation, coupled with widespread currency debasement by central banks.
My first stock market experience was in the long term bear market starting in 1966 and lasting until the summer of 1982. The annual average total return for the S & P 500, adjusted for inflation, starting on 1/1/1966 through July 1982, was almost a -2%. That is annually with dividends reinvested. My first stock was bought around 1968.
For most investors, I would stick with low cost index funds. For U.S. stocks, that could be either SPY or VTI as the core, adding QQQ for more growth oriented stocks.
Vanguard Total Stock Market ETF (VTI)
Expense ratio 0.03%
https://investor.vanguard.com/etf/profile/VTI
I would add a VNQ in some percentage.
I would not personally fool now with bond ETFs since a minor uptick in interest rates will result in a share price loss greater than several years of dividend payments.
If I had to add one, it would be a broad bond ETF like BND.
Vanguard Total Bond Market ETF
https://www.marketwatch.com/investing/fund/bnd
Expense Ratio: 0.035%
https://investor.vanguard.com/etf/profile/BND
Another bond ETF option would be LQD or IEF.
Another option for a slither would be a healthcare ETF or mutual fund.
I would develop a reallocation strategy among asset classes.
I would without fail buy when the markets collapse.
To have funds available when that happens, and it will happen repeatedly over a person's lifespan, some money needs to be held in reserve.
So I would just keep it simple, somewhat mechanical, buying when there is blood in the streets as a cardinal rule, reinvest the dividends, never sell out of panic, and try not to beat the market with individual security selections.
"""I am just disgusted with my options for cash now"
Delete"I am not going to do anything meaningful until I have absolute clarity on what will happen with this virus or the market plummets down like it did in March. """
I was trying to ask a timing question.
For the moment, you aren't buying meaningfully. Aren't finding stocks a good haven as well as bonds.
Would you see this point, also not a good haven and not meaningful... if you have the different goals of:
Slightly longer horizon,
Need for growth?
I tend not to.
But with your experience does it produce a different gut about what to do at this time/point in the market, if you had a different portfolio need?
-----
The etf and strategy as an overall is interesting. For years I had diverse ETFs for large to small & growth to value. Once a year I'd rebalance to make them more equal. It's what I plan to do with most of my funds when I get them in.
Land: I view bond purchases now with more disdain than stock purchases. I am glad that I have no need to grow capital because I do no like the investment options now.
DeleteThere have been times when I did not have a meaningful stock position. Over time, what is meaningful to me has changed in $$ amount.
In the late 1970s, I owned one stock, a 400 share position in Duke Energy, that I bought around 1978. I did not start buying again until the summer of 1982.
Instead of owning stocks during the late 1970s, I accumulated cash and bought short term CDs that were then yielding over 10%. I then used the cash to build the house that I still live in now.
I call this process Dynamic Asset Allocation and discussed it in this 2008 post:
https://tennesseeindependent.blogspot.com/2008/12/static-v-dynamic-asset-allocation.html
I eliminated all of my stock positions in the 1998-2000 period.
In 2007, I dramatically pared my stock position, moving the proceeds into A or better rated short term corporate bonds and cash. I still owned too many stocks when the bottom fell out in 2008, but I had plenty of cash to start buying with gusto starting in February 2009 that allowed me to return to my October 2007 total portfolio value by June 2009.
When I look back, the major buying points occurred in 1974, 1982, 2002, and 2009. If I had done nothing in between, and simply bought during those years with whatever cash was laying around, I would be better off financially than I am now.
Results could be improved with God like timing which would require some selling in 1999 and 2007 and some buying in major declines like what happened in March.
One problem that I am seeing now is widespread dividend cuts and eliminations. For me, I venture into stocks to generate more income per $$ invested than I can with bonds. And, many stock sectors used by individual investors to generate income, including MREITs, equity REITs and BDCs, are the ones where widespread cuts and eliminations are occurring. Regional Banks are notorious for cutting dividends during downturns. The cuts have not started to happen yet, but will start if the blue sky scenario does not start in the third quarter.
On using mostly ETFs, I would add a few stock ETFs to the core SPY or VTI position. I prefer VTI since it includes large, mid and small caps. I mention layering QQQ onto the core U.S. stock ETF for more growth and a healthcare ETF to play a long term secular growth trend.
Maybe up to 10% of the total portfolio could be invested in individual stocks for most investors, particularly those who lack the time to research.
Some investors may want to allocate some funds to gold as an alternative to the fiat currencies.
Cash has become trash with the current yield alternative for credit risk free purchases. It is easier to allocate out of stocks when risk free investments were over 10% (e.g. 1978-1982) or generally over 5% (e.g. 1999).
https://www.bankrate.com/banking/cds/historical-cd-interest-rates/
Thank you, that certainty answers the question. Too bad the answer on equities and bonds is "good grief." Does complicate things.
DeleteThe dividend cut concept is a good reminder.
I'd jumped a few toes into individuals, in during Dec 2018 (some prior.) One conclusion is to buy individuals only when I've got a good feel for one and confidence. Not to buy just to have an individual stock. In this drop, the indices would have been just as good to play with. Especially by adding in the small caps.
With current bankruptcy and div cut risks it's even more important.
The one advantage is a strong stock for growth or > than indice DGI type divs. So I'll keep my eyes out for those.
This market is just too overvalued to be comfortable. Even if everything went back to normal today, valuations aren't smashing on the quality in covid-benefitting/surviving sectors.
I think it's also a mistake to focus only on covid. There's an election coming. Trump tariff and distraction fever. May be other factors.
The rates had flipped and economy was likely headed for a recession in a year or two. Maybe that risk is gone with this deflation of any "heating up." I don't have enough expertise to tell. But maybe not, and there may still be some underlying factors from that to pay attention to eventually. (?)
I need to add a focus on the healthcare sector too. Tech too.
--
""When I look back, the major buying points occurred in 1974, 1982, 2002, and 2009. If I had done nothing in between, and simply bought during those years with whatever cash was laying around, I would be better off financially than I am now. ""
That's intriguing. Do you mean that if you'd held cash in an interest account, and bought stocks at those points, that would have beaten the other ideas such as buying and holding and trading as seen fit?
Land: I have not run the numbers comparing a buy and hold with buying at the most opportune time.
DeleteHowever, buying the S & P 500 after a 45%+ drop (and then holding) and buying again only after another 45% drop (and then holding) would produce better returns then buying continuously when the market is in an up cycle. Just like buying last March would have been better long term than buying in early February.
I did run one total return SPX calculation for purchases in January 1973 (before the 1974) collapse and September 1974 which was near the bottom.
Sept 1974: 14526.195%
January 1973: 8822.198%
I used this calculator and ended the period as of April 30, 2020 since May data is not yet fully in.
https://dqydj.com/sp-500-return-calculator/
That would not be a hard and fast rule since too much money may be accumulating in between major cycle lows.
The general point is that buying after at least a 45% decline (1974, 2002, 2009) has worked long term except for 1929-1932 when the market continued falling before bottoming at over an 80% decline.
For buying an index during a long term bull cycle, that can work provided the investor has the ability, both psychologically and financially, to ride through the Big Nasties and has capital to invest during those inevitable dark periods.
By financially, I am referring to no need to sell stocks to pay expenses during long bear cycles, or what I generally call free from situational risks that would require selling at an inopportune time to raise capital.
One situational risk is retirement where liquidating investments to pay expenses is required and the period left to recover from a long term bear cycle is much shorter given the person's age.
There was a period when buying a 30 year treasury at the start of a long term stock market would have produced better returns.
There was a brief period when the 30 year U.S. treasury was selling at a 15% yield and that coincided with the start of the 18 year bull market in 1982. I recall doing the calculation and I would have been better off buying a 15% 30 year bond in 1981-1982 than using the money to buy the S & P 500 even with the 18 year bull market to come.
30-Year Treasury Constant Maturity Rate
https://fred.stlouisfed.org/series/DGS30
Needless to say, that option is not available now with the 30 year at 1.3%.
Ah, I see.
DeleteI think the way to think is when market is down a lot, use that as an absolute marker for buying and buy away. Without concern that there's more drop to come. Though pick solid companies. Now if I could go back to March and do that.
That's an interesting set of calculations in various scenarios.
To get divs - having cash working is a big plus. This new no-interest environment has changed what looks like a good method.
I had some 6% CDs that lasted long into the ZIRP period, not knowing that was coming. That worked out well. I didn't pile into those 15%ers as the inflation was coming down.
Land: You have to go back to around 1981 for the 15+% 3 month CDs. I kept some of the paper after the CDs matured as momentos. I may have had one or 2 near 20%. Those kind of rates allowed me to rapidly increase my savings so I could pay cash for my lot here and to build the house back in 1982 without a mortgage. The 30 year mortgage was then around 16%.
Deletehttp://www.freddiemac.com/pmms/pmms30.html
As I recall the 30 year treasury bond could have been bought with a 14% yield during 1984 even though CPI had already come down to 3% to 4% and the annual average real rate of return turned out to a 11+% over 30 years. That kind of pricing assumed that the next 30 years would be like the prior 30 which turned out to be a massively wrong prediction on inflation and interest rates.
The Canadian stock market is closed today. I participate in that market and will see whether anything can be bought tomorrow morning.
While PWCDF is trading in the U.S. stock exchange, a stock discussed in this post and the last one, the price is determined in the more liquid CAD price shares traded in Toronto with that price converted in USDs at the CAD/USD exchange rate.
So investors are guessing today how the stock will trade tomorrow in Canada and the conversion rate of CADs into USDs for the Canada traded shares.
Power Corp. of Canada
$14.14 +$ +$ 0.33 +2.39%
VOLUME: 10.9K
Last Updated: May 18, 2020 2:23 p.m. EDT
https://www.marketwatch.com/investing/stock/pwcdf
KRE is now up 10%. I could have bought it at up 4 or 6% when I posted earlier.
DeleteI had no problem with the market sinking. The Fear of MissED out is more stressful.
My move today was to sell $2000 each of SPY & IWM equivalents in my 401k.
If market breaks trading range and / or 200 dma, I'm buying a lot more. Otherwise, waiting for the next worry moment. New goal: I'm going to treat this as I would in a bull rally and buy into each dip. Not my sense of things, but when in Rome or the USA market, do what they do. (Though not what I did today.)
I made most of my buys in the 401k during this crisis, at higher than current prices. There surprising isn't too much to sell at a profit yet.
Be good to be patient and merely hold these buys for when the market does recover in a year or two. However, it's a small sell amount to give me something to do. The bet is that it will be possible to buy back lower...
Looking at the charts, it's like the market thinks this is super duper news on the vaccine front. One doctor on MSNBC said it's basically offensively misleading news. He wasn't in a financial segment. He's just saying 45 people at this phase is a long way from a meaningful vaccine. He seemed a little dark to me, so I'll take it as medium-low (medium-raw?) news.
So like the pop on Gilead's I expect the market to calm down it's excitement on this too, as they start thinking it threw.
Land: I never draw any conclusion from a Phase 1 trial. The study group is just too small and lacks diversity. The main purpose is to assess safety and whether the drug has any desired activity.
DeleteFrequently, the safety issues do not arise until a large, more diverse group is given the drug. Many drugs proved to have serious adverse effects including death only when widely prescribed after the FDA's approval (e.g. Vioxx).
Even if Moderna's vaccine Phase 1 results are duplicated in a large Phase 3 trial, we are still looking at early 2021 for mass production. In the meantime, the virus is still around, infecting and killing people.
One churchgoer recently infected as many as 180 others:
https://www.msn.com/en-us/health/health-news/churchgoer-potentially-exposed-180-others-to-covid-19/ar-BB14ga3o?li=BBnb7Kz
A few minutes before the close, I bought 1 share SDS and 1 share TWM and sold some of my highest cost lots profitably. Most of the buying was in 5 to 10 share lots earlier in the day. I mentioned PBCT and WASH in an earlier comment. Since the buying was so insignificant, the hedging was equally insignificant.
I have no idea what else the FED could do. They have basically done everything that has occurred to me and then a lot more, including becoming a business lender under Main Street Lending Program:
https://www.federalreserve.gov/monetarypolicy/mainstreetlending.htm
The FED's balance sheet is expanding rapidly. QE is in a no limit mode to buying treasuries and mortgage backed securities ZIRP is in place. Negative real rates are already here.
Monetary policy is already super aggressive and easy. And there are serious short term and long term negative effects from what they are doing now.
Over 10 trillion dollars of household wealth is tied up in savings accounts, CDs, money market funds, and similar investments. The income generated on that $10+T now provides insignificant disposable income to save or spend.
Anyone limiting their investment to short term credit risk free instruments are paying a price and will likely continue doing so for several more months.
The shares I'd sold at prior rally, or want to sell more of ... are not up to those highs yet. Garmin, LMT, INTC. Nothing is. TXN & PFE are the closest.
DeleteSo there aren't magic FED bullets I didn't know about.
By neg real rates I assume you mean returns after tax and inflation. Fed rates are still 0 to .25%? I don't understand that there's a range. I would think it'd be one number.
I have published a new post:
ReplyDeletehttps://tennesseeindependent.blogspot.com/2020/05/axpra-brg-cfg-ddt-duk-fsk-igr-irt-jri.html