A rare week with no conferences or business meetings to attend leaves lots of white space on my calendar. I am bereft of live events but news items still feed my sarcasm.
Another meaningless debt limit will come and go in October with absolutely no effect on federal spending decisions. Anyone who thought the national debt stopped growing took their eyes off the ball. The drama next month will allow the Republican-controlled House to posture against Obamacare while doing absolutely nothing about it. The ceiling will rise and deficit spending will continue. Only forced selling of Treasuries by central banks is going to stop this circus.
Durable goods orders are in a surprise freefall. The only people truly surprised were those who thought QE could conjure real prosperity out of thin air. The weak yen and euro make exports from those areas temporarily more competitive. Expect more competitive devaluation here to make US exports look better.
JPMorgan Chase messed over the wrong Russian-American billionaire. I had previously thought that wealth managers only sought to stick it to their low-rung clients just to extract as much revenue as they could before those accounts departed to a discount broker. Now I see that even premium wealth managers will allow billionaires' portfolios to slide out of specified tolerances if it gets them more revenue. I still think JPM has nothing to worry about from other court cases. It's a SIFI and those other litigants are small fries with no high-powered connections.
Facebook's valuation continues its march into insanity. I have to LOL at the 180 P/E. Here's the simple math. Net income would have to be 9x larger for FB to have a P/E comparable to other tech companies. The market is pricing in a ramp-up in earnings that even Amazon hasn't produced after a decade. I'm still pricing in the inability of Facebook to make it happen in mobile, which implies a P/E collapse to about 20. That further implies a true valuation of $4.59/share, or just about the five bucks I've always pegged for an FB share. I'll believe Facebook has conquered mobile when its percentage of revenue from mobile ads equals the worldwide percentage of Web users who predominantly use mobile for Web access.
Nothing in the news today made me angry enough to use profanity in my home office. That's just as rare as having no business events on my calendar.
Full disclosure: No positions in any companies mentioned at this time.
Another meaningless debt limit will come and go in October with absolutely no effect on federal spending decisions. Anyone who thought the national debt stopped growing took their eyes off the ball. The drama next month will allow the Republican-controlled House to posture against Obamacare while doing absolutely nothing about it. The ceiling will rise and deficit spending will continue. Only forced selling of Treasuries by central banks is going to stop this circus.
Durable goods orders are in a surprise freefall. The only people truly surprised were those who thought QE could conjure real prosperity out of thin air. The weak yen and euro make exports from those areas temporarily more competitive. Expect more competitive devaluation here to make US exports look better.
JPMorgan Chase messed over the wrong Russian-American billionaire. I had previously thought that wealth managers only sought to stick it to their low-rung clients just to extract as much revenue as they could before those accounts departed to a discount broker. Now I see that even premium wealth managers will allow billionaires' portfolios to slide out of specified tolerances if it gets them more revenue. I still think JPM has nothing to worry about from other court cases. It's a SIFI and those other litigants are small fries with no high-powered connections.
Facebook's valuation continues its march into insanity. I have to LOL at the 180 P/E. Here's the simple math. Net income would have to be 9x larger for FB to have a P/E comparable to other tech companies. The market is pricing in a ramp-up in earnings that even Amazon hasn't produced after a decade. I'm still pricing in the inability of Facebook to make it happen in mobile, which implies a P/E collapse to about 20. That further implies a true valuation of $4.59/share, or just about the five bucks I've always pegged for an FB share. I'll believe Facebook has conquered mobile when its percentage of revenue from mobile ads equals the worldwide percentage of Web users who predominantly use mobile for Web access.
Nothing in the news today made me angry enough to use profanity in my home office. That's just as rare as having no business events on my calendar.
Full disclosure: No positions in any companies mentioned at this time.
