DHUnplugged #715: Eco Confab Week
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Jackson Hole ECO Confab (this week)

Live Nation is in trouble

Icahn get a slap on the wrist

Gold – ripping – where to next?

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Warm Up

• Jackson Hole ECO Confab (this week)
• Live Nation is in trouble
• Icahn get a slap on the wrist
• Gold - ripping - where to next?
• Price Controls - 3rd Rail?

**Market Update **- Nearing all-time highs again - Buy the Dips!

• Yields under 4% on 10-Year - Yen still in control
• Back to Overbought again - still thinking not out of the woods
• Lowe's and Home Depot Outlook - POOR (But stocks are up)

Jackson Hole

• Aristocrats line up to speak
• Big doings as often a platform for Fed and other central bankers to make policy adjustments
• Powell scheduled to speak at 10am Friday --- With all of the latest data and market push - what will he do??
• Before that - Wednesday we will see the July FOMC minutes

GOLDDDDDDDD

• Gold hit all-time high last Friday ($2,509.65) !!!!NOW $2,563!!!!!
• WHY? Discussion ranges from Fed Reserve, Election, Middle East, India Buying....
• Gold has been a better GOLD then Bitcoin - just saying...

Monopoly - Finally!

• Ten Additional States Join Justice Department’s Suit Against Live Nation-Ticketmaster for Monopolizing Markets Across the Live Concert Industry
• Today, the Attorneys General of Indiana, Iowa, Kansas, Louisiana, Mississippi, Nebraska, New Mexico, South Dakota, Utah and Vermont joined a civil antitrust lawsuit filed by the Justice Department, 29 other states and the District of Columbia against Live Nation-Ticketmaster for monopolization and other unlawful conduct in violation of Sections 1 and 2 of the Sherman Act.
• Stock does not seem to care - or believe anything adverse will happen

AMD buys ZT Systems

• $4.9 Billion
• What is ZT Systems? The company engages in full rack deployment -- a block filled with servers, storage, switches, etc. -- for hyperscale data centers. ZT also commands a data center infrastructure manufacturing business, for which AMD announced it would seek out a strategic partner to offload this part of the company.
• Clearly the company does not have a CHIP or infrastructure  ready for a major AI play at this time.

Carl Ichan - Hand Slap

• Carl Icahn and his publicly traded company Icahn Enterprises settled with the SEC over allegedly failing to disclose billions worth in stock-backed borrowing.
• Icahn and IELP will pay a combined $2 million in fines, without admitting or denying wrongdoing, over the failure to disclose as much as $5 billion in margin loans that were backed by Icahn’s stake in the company.
• Icahn, a well-known activist investor, had been facing pressure from another activist short seller in 2023. (Hindenburg which is still short the shares)

Circle K 11?

• Canada's Alimentation Couche-Tard (Circle K) has sounded out Japan's Seven & i (7-Eleven) about a potential takeover, the two companies said on Monday, making the 7-Eleven owner the largest-ever Japanese target of a foreign buyout.
• While the value of the offer has not been disclosed, the bid is the latest example of the growing interest in Japanese companies by Western investors, who have been drawn by the country's push for better governance.
• News of the deal sent shares of Seven & i surging by almost 23% in Tokyo

Chicken and the Egg

• Chicken prices are going up
• Perdue Foods is recalling more than 167,000 pounds of frozen chicken nuggets and tenders after some customers reported finding metal wire embedded in the products.
• According to Perdue and the U.S. Agriculture Department’s Food Safety and Inspection Service, the recall covers select lots of three products: Perdue Breaded Chicken Tenders, Butcher Box Organic Chicken Breast Nuggets and Perdue Simply Smart Organics Breaded Chicken Breast Nuggets.
• May be contaminated with a foreign material after receiving an unspecified number of customer complaints.
• But egg prices (unrelated to above) are going up again - prices up 50%  from the recent low in September 2023 ($2 per dozen to $3 per dozen) --- Blaming on bird flu....
• Jan 2023 high of $4.83 - so down 50% from high

And Yet...

• Retail Sales: Advanced retail sales accelerated 1% on the month, much better than the 0.3% estimate.
• Excluding auto-related items, sales increased 0.4%, also better than the 0.1% forecast.

Hack Alert!?

• 2.9 billion people may have had Social Security numbers, other financial data compromised.
• If true, reports suggest all Americans may have had valuable personal information compromised — including full names, current and past addresses, Social Security numbers and information on parents, siblings and other relatives.
• The alleged April 2024 breach occurred when a background check company doing business as National Public Data, owned by Jerico Pictures Inc., failed to properly safeguard information it scraped, the lawsuit states. The company provides instant search access to billions of records.
• How did they SCRAPE all this info?

Back to Bonds

• Speculators raised their net short bets on five-year Treasuries to the largest on record in the latest week, while bearish bets on 10-year Treasury futures were the largest since January, according to data by the Commodity Futures Trading Commission on Friday.
• Treasury yields have rebounded from more than one-year lows reached in August, when concerns mounted that the U.S. economy is rapidly weakening and due to a stock market rout caused in part by the unwind of popular dollar/yen carry trades.
• Better economic data this week and hotter-than-expected shelter inflation in July has also reduced expectations that the Federal Reserve will cut interest rates by 50 basis points at its September meeting, with a 25 basis point cut now seen as more likely.

More on Weakening Demand

• Lowe's cuts full-year outlook as it expects home improvement sales to weaken
• Lowe's on Tuesday cut its full-year forecast, as the home improvement retailer's quarterly sales declined and it said it expects spending on do-it-yourself projects to weaken.
• The company said it now expects total sales of between $82.7 to $83.2 billion for the full year, compared with the $84 billion to $85 billion that it previously expected.
• It said it expects comparable sales to fall by 3.5% to 4%, compared to its prior forecast of a decline of 2% to 3%. It anticipates adjusted earnings per share will be approximately $11.70 to $11.90, compared with the prior outlook of between $12 and $12.30.
• Very similar to Home Depot
• Investors are really not discouraged though

Price Controls

• WTF are they talking about?
• Price controls are government-mandated minimum or maximum prices set for specific goods and services. Price controls are put in place to manage the affordability of goods and services on the market. Minimums are called price floors while maximums are called price ceilings. -We already have price controls with rent, labor wages and medicine costs - what else they talking about ???? ---- Are they thinking of setting up the Price Gouging Board?
• Good politics, bad for free markets

Higher Corporate Taxes

• Harris is now pushing higher corporate taxes (really just rolling back the Trump tax cuts )
• If enacted, the policy would raise hundreds of billions of dollars, as the nonpartisan Congressional Budget Office has projected that 1 percentage point increases in the corporate rate corresponds to about $100 billion over a decade.

More good news....

• Eli Lilly's highly popular weight loss drug reduced the risk of developing Type 2 diabetes by 94% in obese or overweight adults with pre-diabetes compared to a placebo, according to initial results from a long-term study released today.
• The late-stage trial on tirzepatide, the active ingredient in the company's weight loss injection Zepbound and diabetes drug Mounjaro, also found that patients experienced sustained weight loss over the roughly three-year treatment period. Adults on the highest weekly dose of the drug saw a 22.9% decrease in body weight on average after 176 weeks, compared to 2.1% for those who received a placebo.
• Glucose monitoring companies are trading lower today: TNDM -6%, PODD -5.8%, DXCM -5.2%

 

Tesla News

• The European Union on Tuesday said a planned tariff on Tesla vehicles being imported from China would be cut to 9% from 20.8%.
• Trump is talking cabinet position fro Elon - but also about killing EV tax credits

AI Scare

• Trump campaign seems to be in the hot-seat over the Taylor Swift AI images posted on social media showing support for Trump by Swift
• In the "old" days didn't we look at these as "photoshop'd"  - - What is the difference -- is it just a media scare practice against AI

Disney - WOW

• Disney has reversed course on a wrongful death lawsuit brought by the widower of a woman who died after eating at a resort restaurant, saying the matter can now proceed to court.
• Previously, Walt Disney Parks and Resorts had argued in court documents that the widower’s Disney+ streaming service contract means he cannot sue for the alleged wrongful death of his wife.
• In the lawsuit, plaintiff Jeffrey Piccolo alleged that his late wife, Kanokporn Tangsuan, suffered a fatal allergic reaction from a meal she ate at a park restaurant in 2023. But Disney tried to get the lawsuit tossed by asking the court to move the dispute to arbitration, meaning the case would not go before a jury or otherwise continue in court.

 

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