Wednesday, February 28, 2018

Short riffs

--- Democrats are already talking about how they will win the mid-terms... Steny Hoyer... way too soon, making same mistake again... if the marginal voters in the U.S. are now open or closet hard right, nothing is certain.

---Georgia and Delta---outside of Atlanta and Athens, the state is just as illiberal and intolerant as panhandle Florida, Alabama, and Mississipi.  Delta is stuck although new slots can be rejected.  Stay away Amazon.

---Goodbye Hope Hicks... you tried to claim the ridiculous executive privilege on most things but the "white lies" comment could not be tolerated by the boss, after all he has done for you.

---Corporate tax cuts not spent on buybacks and one time bonuses, or investment spending, will obviously be spent on technology... leading to a one or two years boost in productivity at best, but after that more job losses.  Not just industry but the service economy has miles to go with increased automation.

---Trump talking about Billy Graham was nauseating on all counts.

Saturday, February 17, 2018

Facebook photo assault

The photos being found and the iphone handy, Facebook is under attack, from here.  Joining Facebook in 2009 at the encouragement of a friend, it was not a natural affinity.  It was only sporadically used for many years, with occasional spurts of activity when financial markets were interesting or politics became especially newsworthy.  Photos attached to articles forwarded were regularly there, but rarely anything personal.  My "friends" list was and remains small by almost any comparison, because many of my friends are not Facebook users, never bit.

There are a variety of "friends".  A few are silent, some infrequent, there are the regulars, then the active, and finally the high intensity.  The "high intensity" are just unequivocally posting, at times multiple times daily.  There are four major ones here that come to mind --- two are driven by political opinions, one by a form of inside joke humor as he banters with close friends, and one by joke telling and extreme right antics that occasionally border on ugly.  Over time some "friends" have been deleted, aka unfriended, and that has likely happened to me at times as well, don't know as don't keep track.

The origin of these species is around three quarters hometown related.  They may live elsewhere but Danville was where they started.  Same here, first 18 years there.  Otherwise there are a few, meaning from one to four, from other places lived and worked --- college in D.C., Louisville, college in Arizona, and my job in Manhattan.  Add a few random special others and that's it.

It now feels like a comfortable place to post a few photos as they surface from albums, drawers, and files.  At times there is a self-conscious feeling, bordering on not wanting to get too personal.  Well, not really bordering, as some things remain unsaid.  How long this lasts is unknown.

Tuesday, February 13, 2018

Where have all the diners gone...

In 1980's Manhattan, diners were ubiquitous, block after block.  Almost everyone had a regular.  "My" diner was on the southwest corner of 2nd Avenue and 50th Street.  It was about 30 steps from my apartment on 50th, just two buildings east of 2nd Avenue.  The diner was mainly for breakfast, occasionally for lunch.  It was a loser move to eat dinner at this completely standard place with absolutely nothing unique and inedible cole slaw, as was the norm at the time in the mostly Greek owned diners.

There was another diner nearby on the east side of 2nd Avenue between 49th and 48th Streets.  This place was unusual.  The cooks were southern black men and the owner was a friendly quirky sort of white guy who always seemed to be there from 5am open to 8pm close.  They served grits with eggs, almost unheard of in the city, not the standard clumpy tasteless hash browns of the usual places. They had fresh fried seafood at lunch and dinner.  Real hamburgers that had taste. The cole slaw was good as was the potato salad.  But this being Manhattan, it was a block and a half away and only frequented when the crawl before coffee was served seemed manageable.  Dinner there at times was an affordable treat but not even beer was available.

Today, those types of diners have largely disappeared.  They have been replaced by more upscale eateries and stores.  If you happen to be at the Met on 5th at 84th and want to grab something quick at a diner while walking to midtown now, there of course will not be anything on 5th, never was, nothing on Madison, once had a few places, nothing on Lexington until you hit a dinosaur a block or two below 72nd, and  3rd Avenue, once lined with diners, has just a few over the 25 blocks.

Today on Facebook, I am posting a picture of "my" diner in 1980.  Why?  Since getting a new iphone two months ago the simplicity of posting photos has made me somewhat deranged.  An infrequent FB poster has gone almost regular.  Events here had already led me to the photo archives and that work is producing results.  There are now faces and not just opinions.

Monday, February 12, 2018

NYT baseball obits

The New York Times does an exceptional job writing obituaries of famous baseball players.  Someone there must remember baseball cards from those halcyon days of the sport in the 1950's and 1960's.  Today there was one for Wally Moon, St. Louis Cardinals and L.A. Dodgers from 1954 to 1965.  His "moon shots" at the first L.A. stadium were famous at the time, just high pop ups straight down the left field line from a lefty.  The stadium was built for his late swings.  Moon's Topps cards were not that easy to get but not so difficult either.  They were perfect trading cards.

Last week there was the obit for Oscar Gamble, famous after the card frenzy days but still a notable player.  The remembrance was more about his hair than his game.  Gene Michael's, a few months ago, was about his managerial career of course, not his time as a shortstop.  He was a focused baseball man every day of his aware life.

This nostalgia type reading about deaths can be refreshing in the morning with coffee.  That sentence does not sound right.  Is that from some film.

Sunday, February 11, 2018

What Monday brings --- opportunity to add or trim

Like many who watch the stock market, looking ahead at the coming week is a time to reflect.  All of the usual has been said by pundits regarding the drastic volatility of the last two weeks.  Is it a normal correction or a major reset, and all of that talk.  Most of the talkers are even afraid to make any projection at all, seeming pleased to show that they remember what volatility means after the last year or so.

Individual investor decisions are guided by individual needs.  How astute an observation?  For most it would seem that it is not a time to be aggressive on the buy side except in special situations.  Anyone who has never found an entry point into Google could watch now.  The problem with pruning a long term portfolio is that often the taxable gains can be substantial.  Yet stocks in the portfolio purchased in the recent past that have modest gains by definition were bought for what were intended to be solid reasons with a dose of intuition that has at times worked well.  Cut back on the new ones with little tax impact or cut back on the old ones with substantial tax impact.  The classic advice is to never make investment portfolio decisions based on tax.  That may often be good advice for institutions but for individuals following "never" is not always right.

The easiest way to cut back here is on index positions, pro-rata extended market, total market, and S&P funds.   Finger will held up outside the door tomorrow to see which way the wind blows.

This downturn is NOT over, no matter what happens tomorrow or in the coming week.  Reasons for a further decline are multi-faceted, from politics and governance, to usual and legal trader games now that there is volatility, and the existing overlay of global events.  The overriding reason is valuation.  The math mostly still works now on the ROE and cost of capital components, but longevity of returns due to Trumpian uncertainties is an overhanging question.  The benefit of the tax bill is done for investment analysis purposes, already factored in.

That's the "thinking out loud" for today --- not so compelling but it is a process.  That process is expected to begin tomorrow.  It may be bumpy.

Saturday, February 10, 2018

WSJ Review --- February 10-11

It has been said here before that the Wall Street Journal Review section on weekends is surprisingly well balanced and interesting.  They may not have the most distinguished writers or reviewers but the books and topics reviewed are well chosen. This week's issue is packed with reading entertainment, and the following are just a few highlights.

A review of "The Rub of Time", an anthology of Martin Amis essays from the 1990's and beyond(being read in pieces here now), is titled "Famous Amis".  That's worth the price of admission.  While there is not total agreement here with all of the self centered reviewer's commentary, that's fine. The effort is made and the book will attract knowing readers if not newbies.
On the same page is Sam Sacks' "Fiction Chronicle".  On the smart, cute, ugly, stupid spectrum, at times Sacks come in as cute and stupid, but at least his reviews are short and give a hint as to whether the books could be of interest.

There's a review titled "Existentialists and Expatriates" that comments on "Left Bank", a book about the famous writers, artists, and expats around the Blvd. St.Germain area in the 1930's to 1950's.  The book, writer, and reviewer are not familiar, but it does seem like something of interest.  The photo of Simone de Beauvoir at Deux-Magots works.  There's an article about a famous Matthew Brady photo of Abraham Lincoln and his son reading a book.  That was new here.  Lincoln was concerned that the book as prop might be mistaken for a Bible and the pose regarded as "a species of false pretense".  Times have changed since Honest Abe.

That's a sample.

Friday, February 09, 2018

White House chaos

It is clear that Stone Age chief of staff John Kelly knew about Rob Porter's inability to get a security clearance and the reason why.  It is also highly likely that, following rules of hierarchy, he told Trump about this two months ago and, in clipped military language, it was dismissed as an issue.  Porter's fealty to Trump was unquestioned, crossing off the most important criteria.  That Porter was efficient and from Trump central casting made this an easy call.  Decision made.  Next.

When information about wife beating became public, the White House speakers praised Porter's work, saying that his resignation was regrettable but understandable. They noted that his departure date was to be determined.  Then photos showed up and they panicked.  Sarah Huckabee Sanders apparently revealed that there is some limit to her well honed lying.  Her male assistant was front and center yesterday.  Ivanka Trump, having been moved from her center stage role by Kelly in recent months, was opportunistically appalled by the photos.  Porter's bags are now immediately being packed.  The story will continue...

Wednesday, February 07, 2018

Trump wants huge military parade

Trump claims that he wants to emulate France and the impressive military parade that he viewed when there. That was on Bastille Day and the parade is an annual tradition in that country.  The truly massive parades of this type are in China, Russia, and North Korea.  They happen periodically but not on a set day each year.  One could say they are at the whims of their dictators.  Yes, I know that there is some pretense of an electoral process in China and Russia, but they are led by all powerful leaders.  North Korea's gulag approach to the family run business makes no attempt to be anything but what they are, other than promoting some strange spiritually ordained power.

What Trump wants is dictator classic.  It fits his style.  Anyone who questions this parade can be labeled as not supporting the troops and being unpatriotic.  An event of the type that Trump wants will be incredibly expensive and divert funds, resources, and attention from military preparedness to create pomp for the Presidential ego.  It seems obvious that such an event would lead to demonstrations by those Americans who do not support this cost and more importantly do not support the showmanship of preparing for war.  The United States has historically been reticent to sink to this level, maintaining the quaint notion that it is not necessary.  It is not part of tradition.  America's strength does not need to be proven.  That's the thought process.

In addition to demonstrations, such an event could be a magnet for aggressive and disruptive protesters, and even lone wolf or small cell terrorists.  The United States has avoided these types of incidents for the most part.  Why provide the target?  If something happened, how could Trump use it to harden his power?  He admires autocrats around the world.  He has a limited understanding of history.  From this opinionated perspective, underestimating the damage Trump can do would a mistake.  He is dangerous, and unfit to be President.  But he is and has the power.

The military parade prospect is unsettling.

Tuesday, February 06, 2018

Gowdy joins Comey in the Trump doghouse?

Representative Trey Gowdy recently announced that he would not seek reelection to his Republican House seat.  He is now standing up to the Trump crowd, and staying focused on the Russian election interference investigation rather than caving in to the compliant Nunes' released memo on the investigation.  If Gowdy's approach to the Benghazi hearings is any guide, he will not let go easily.

This is interesting.  A casual observer, as well as serious ones, could observe that the Gowdy led Benghazi hearings and Comey's on again off again investigation of Clinton e-mails were two key elements of Hillary Clinton's defeat and of course Trump's election.  In many ways, one led to the other.  In his awkward way, Comey continued with the Russia investigation in a non-linear but determined way, and Trump fired him for that specific reason.  One could surmise that the South Carolina Republican Gowdy now feels free to continue pursuing the investigation without undue political pressure. Trump can't fire a congressman.  He can't ruin a retiring ones chance for reelection.

South Carolina's politics can be quirky.  From Strom Thurmond to Lee Atwater, enlightened minds are not the first thought.  Still, there is a strain of state individuality that exists. They cannot be easily grouped with Georgia, Alabama, and Mississippi.  The often quotable Senator Lindsey Graham uses humor to charm or cut, Senator Tim Scott is a right wing African American far to the right of Graham, among Representatives there's "you lie" Joe Wilson and the South American adventurer Mark Sanford.  They don't shy from the stage.

Now Gowdy has it, on a national level.  Could he do something important?

Friday, February 02, 2018

Financial markets wake up --- decline today

This was not a surprise.  It was an overdude due day, misspelling meant, am I loo loo loosing it,yeah mo mo money.  Days like this always jar investors because of their unpredictability and their precipitous nature.  In hindsight, this is minor and some would say necessary.  Hindsight... on October 19,1987 the Dow fell by 508 points, or 23%.  That was huge.  Today the market fell 665 points, or 2.5%.

The decline today did accelerate in the last hour.  Remember watching for those margin calls after 3pm in 2008 and 2009.  We just saw a touch of that.  Energy stocks, bank stocks, and mid-caps
 were hit hard for the most part. Small caps were mostly ignored. Among major technology stocks, Google and Apple were whacked while Netflix and Amazon rose. This is not simple.  High flyer Visa took a big step back and closely followed volatility king Freeport McMoran dropped 8%.  The questionable Sprint bet here was up 5%.  Vaunted BKB fell 3.75%, almost twice the Dow drop. Go figure.

This was a broad sell-off.  One earlier headline read, "Wall Street drops due to robust jobs data".  That's the "good news is bad news scenario" of potentially rising interests leading to inflation and a higher required rate of return for stocks. The so-called "elephant in the room" is a dysfunctional government.  Wall Street wants to ignore that and enjoy the tax cuts.  If there is a domino to fall on that issue it will be much larger and persistent, aka domino effect.  That is not expected yet.  "Yet" is opinion here but not acted on in any meaningful way yet.  How many times can that word be used in one paragraph.

More opinion ---  this was absolutely necessary.  A rising market is not guaranteed even in a stable economy.  Backtracking a bit more and setting a new base would be ideal.  For that to happen more fear is necessary, but please not too much.  No sleep disruption.  That's already taken care of.