Archive for June 2018

The Friday File: While 32 teams are competing in the 21st World Cup in Russia, only a handful have a winning chance. Brazil and Germany are favorites with 5:1 odds each. France and Spain follow at about 6:1, then Argentina and Belgium at 10:1. With the USA out, I’m rooting for a winner from the…

Many retail stores are shrinking their footprint or declaring bankruptcy. In part, it’s because online sales have been rising by an astonishing 17%/year for two decades and are now 9% of all retail sales. Moreover, there are 24 square feet of retail space/person in the US; tops in the world. Canada has 17, followed by…

That the Fed raised short-term rates by one quarter percentage point earlier today wasn’t surprising. What was somewhat unexpected was that the Fed now expects to raise rates four times this year, not three. But what set the markets into a slight tizzy was the hawkish tone of the post-meeting statement, suggesting that relatively soon…

While the CPI rose by a solid 0.2% in May, it rose by a strong 2.8% over the past 12 months, the fastest rise in Y-o-Y CPI inflation since 2/12 when it rose 2.9%. Core CPI, which excludes volatile food and energy and is thus a better inflation measure, rose 2.2% over the past year,…

Spending on Social Security recipients will exceed revenues this year for the first time since 1982. Worse, the SS trust fund, which holds $3 trillion, will be empty by 2034, after which recipients will receive 75% of scheduled benefits absent programmatic changes. Medicare’s insurance fund will be depleted in 2026, after which 91% of costs…

The Friday File: While beer sales will rise with temperatures, how much your sudsy relief costs will greatly depending upon beer excise taxes. In Wyoming, they are just $0.02/gallon, lowest in the USA, followed by Missouri and Wisconsin at $0.06/gallon. By contrast, try not to choke on your brew in Tennessee, where taxes are a…

The rise in merger and acquisition activity that is pushing up share prices should allow 2018 to equal or surpass the M&A record high of 2007. This will saddle US firms with not only record debt levels, but debt of deteriorating quality. Add to that recently loosened banking regulations and normal late cycle overexuberance, and…

When the Great Recession ended, there were 14.6 million unemployed job seekers in the US, but just 2.2 million job openings. The seekers/openings ratio was a dismal 6.6. Today, there are just 6.3 million job seekers and an all-time high of 6.7 million openings. There are now more job openings than job seekers. The ratio…

If Trump wants to fight over trade, he should consistently impose tariffs and never use quotas. With tariffs, the artificially higher price results in increased revenues to the US Treasury. With quotas, the higher prices benefit foreign manufacturers. Also, never suggest tariffs or quotas are potentially in the works; that just encourages domestic firms to…

May’s employment numbers were excellent. The unemployment rate fell to 3.8%, a level last seen in 4/00! The unemployment rate for African Americans declined to 5.9%, the lowest level since record keeping began in 1/72, and the unemployment rate for women was 3.6%, its lowest since 1953! Lastly, the unemployment rate for those with less…