It’s an odd, yet exciting time to be alive. Technology has made communicating and accessing information extremely convenient. You’re probably reading this article in the palm of your hand just after sending a Snapchat of your plant-based vegan burger.
That wasn’t possible 20 years ago, it also wasn’t possible to daytrade high-risk options while sitting on the John. The Fed cutting interest rates and buying bonds as the market approaches all-time highs was also unheard of 20 years ago.
But, that’s exactly what’s going on. The Fed is printing money out of thin air and buying up Treasurys again. They insist it isn’t QE (quantitative easing) the unconventional monetary policy used by central banks to rescue the world’s economy back in 2008. Deny it all you want it’s essentially QE all over again.
Just this Thursday the Fed had to inject $104.15 billion into short term debt. That’s nothing to worry about, right? I mean they certainly don’t want you to make a fuss over it.
With the Federal Reserve expanding its balance sheet and cutting interest rates back to historic lows, it makes one wonder what the next economic downturn will look like. If the greatest economy in the world is too stuffed with debt that it can’t handle a minor interest rate increase, we are in some serious trouble.
But for now, life is good. Crack open a White Claw and enjoy the perks of the propped-up economy while it lasts.
A Decent Start to Earnings Season
Tech and finance industries have been under scrutiny with analysts expecting weaker earnings. That’s not what happened this week, although it is still a bit early.
Companies like JP Morgan ($JPM), Netflix ($NFLX), Chase ($CCF), Bank of America ($BAC) and Johnson & Johnson ($JNJ) all posted better-than-expected numbers this week. Some disappointing numbers came from Goldman Sachs ($GS) and an earnings miss from International Business Machines ($IBM).
Juul Has Stopped Selling Fruity Flavors
The e-cigarette giant is no longer selling fruity flavors like mango and cucumber online. The company has already stopped selling some selected flavors in stores. While kids shouldn’t be sucking on a Juul pod, most Americans seem to agree it’s unfair that adults don’t get to enjoy the different flavors.
A spokesman for Juul, Austin Finan said in a statement “We continue to review our policies and practices in advance of FDA’s flavor guidance and have not made any final decisions. The proposed ban from the Trump administration will remove all flavored pods, even mint and menthol.
Keeping up with Brexit headlines has been harder than keeping up with the U.S. and China trade headlines. But here is the latest on the situation. A new deal was agreed on by the EU and Boris Johnson on Thursday. Just after the deal was agreed upon, Johnson’s Irish allies in parliament said they could not support it. The prime minister will need to get the deal to pass the House of Commons before the deadline on October 31st.
$50 Billion Opioid Settlement
Drug distributors McKesson Corp ($MCK), AmerisourceBergen ($ABC) and generic drugmaker Teva Pharmaceuticals ($TEVA) are working to get a settlement deal done before a landmark federal trial starts on Monday. The proposed deal is said to be worth $50 billion dollars and includes a mix of free drugs and cash. The latest news states no deal was reached and the tr
The opioid crisis has taken the lives of many people, but these companies were following rules set by the FDA. Nonetheless, this is America and no one is accountable but everyone is happy to shift blame. Could alcohol manufactures be next in line to get sued for killing people? Who knows?
Wall Street Weekly Performance
S&P 500 $SPY +0.80%.
NASDAQ $QQQ +0.61%
Emerging Markets $EEM +0.66%
Long Term Treasuries $TLT -0.61%
This Week’s Top Gainers
Bionano Genomics $BNGO +286.92%
NF Energy Saving Corp $BIMI +263.64%
Datasea Inc $DTSS +160.32%
This Week’s Top Losers
Provident Bancorp $PVBC -52.49%
Ideaya Biosciences $IDYA -26.18%
Extraction Oil & Gas Inc $XOG -25.479%
MEME of the Week
What Else Is Happening
- SoftBank is working on a rescue plan for WeWork that values the company below $8 billion.
- The global economy has entered a period of “synchronized stagnation” due to weak growth and no growth in some countries according to research by Brookings Institution and the Financial Times.
- The U.S. and Chinese trade negotiators are working on the text for the “Phase 1 Trade Deal.” U.S. Treasury Secretary Steve Mnuchin stated on Wednesday, that he is prepared to travel to Beijing for more meetings if necessary.
- A tentative deal between the United Auto Workers and General Motors is being negotiated. The strike will continue against GM until an official deal is reached.
- September Video Game Sales Drop 8%. “Year-to-date spending across tracked video game hardware, software, accessories, and game cards has fallen 6% when compared to 2018, to $8.3 billion.” Stated analyst Mat Piscatella.
- The World Bank cut India’s growth projection by 20%. Citing risks in its non-bank financial sector and a cyclical downturn.