stevenkesslar

The S &P 500 is at all time highs.  I'm making money hand over fist.
Oh, and like everyone middle class, my net worth is way up.  
Here's what YCharts says:
Higher prices suck, for sure.  But wage growth has been exceeding inflation for about a year now.

 
So do I think it's gonna screw up the economy and investing that wages are growing faster than inflation?  No, I don't.  Sorry.  
If we are talking about personal investing, rather than the unchanging dirge about inflation, here's something odd.  I did think we were about to enter into a correction phase in the S & P.  It has certainly been on a roll.  One reason why, among several, is Glenn Neely, who I have mentioned before. It's all kind of voodoo Neowave theory.  But on big calls, Neely has been correct most of the time.  Like when the 2000 downturn started, and when the GFC started and the market plunged. In both times at the very beginning he said, "Get out!"
So in February he was saying, and I quote, "upside progress should be minimal to non-existent for the rest of this quarter."  He thought Feb. 12 was when the decline would start, since the S & P had the biggest one day drop since this rally started right after Halloween.  I actually closed out about half my shares in SOXL, at something like a 150 % profit.  Although the ones I bought last October and still have got up to about a 200 % profit.
Anyhoo, funny thing.  The market kept going up.  SOXL exploded.  Something about all this investment in chips and new factories that the US is leading the way on.  How did that happen, anyway?  So Neely was wrong, and he has now flipped.  He's now saying the market seems to want to keep going up.  Now he's saying "the S&P will not drop much (even if it wastes time) before beginning a new advancing phase."  Rally on!  I bought 1000 shares of SOXL back, hoping to enjoy the next ride up.
Point is, while this unwavering dirge about inflation has been going on, the stock market has been on fire.  And home prices are going up, too.  Again, average middle class net worth is higher than it has ever been.  Inflation, after it's huge jump from 3.09 % in January to 3.15 % in February, is still below the long term average.
If this is how it works when things suck, can we make it so things suck all the time?  😉

I've read like half a dozen articles suggesting that the reason Tim And Friends and Steve and Friends are showing up is that the hedge fund folks smell a commercial real estate recovery.  It makes sense.  First, as incompetent as government can be, it's a good guess the two former Treasury Secretaries have some idea what they are doing.  Second, inflation is down, and interest rates have likely peaked.  Now the question is when do rates start to come down.  Personally I think the doomsayers predicting we will have 500 regional bank closures are full of it.  The more likely scenario is a coming commercial real estate recovery that our pals at the hedge funds want in on for cheap.
I just dumped half the shares I bought in NYCB at $4 at a small profit and am just waiting to see if it goes up toward $5 before I dump the rest.  I bought some shares in a few others regional banks that have dividends of 6- 7 %.  And I will buy more when I close out NYCB completely.  Steve and Friends cut the dividend at NYCB to a penny a quarter once they took control.  It had already been cut from 17 cents a quarter to 5 cents a quarter.  Steve and Friends get hundreds of thousands of shares at $2 a share.  Which basically means they already have a 100 % profit.  So it does seem like, "We get it all.  And you get none."  I think this one was a legal bank robbery.   
I'll follow it for the next couple months.  The shareholders who owned $11 shares before the "crisis" have been posting on message boards about how Sandro DiNello, who rode the GFC foreclosure wave to fame and fortune like Steve and Friends, and who became the NYCB CEO a week or so before the "crisis" led to the vultures sweeping in, seemed to do everything he possibly could to create an environment of crisis.   We'll see.  They are NOT on the FDIC's problem bank list.  And when asked at their presser what the delinquency rates are on these supposedly toxic NYC rent-stabilized multi-family loans, they said they are low.  So it's not at all clear that the bank has real loan problems.  We'll learn soon enough.

The media has focused on the amount of assets held by Silicon Valley, First Republic, and Signature.  Which is fair.  But it still boils down to a few bank failures.  As opposed to something like 500 bank failures during the GFC.  The problems at the banks that went under a year ago had to do with interest rates, and also crypto.  So if this were a similar crisis where things were cascading out of control, like foreclosures and bank failures did continuously from 2008 to 2012 or so,, I think we would know that by now.
This is an indicator of recovery, not crisis, I think.
Hedge funds bet on U.S. real estate rebound
 

The S &P 500 is at all time highs.  I'm making money hand over fist.
Oh, and like everyone middle class, my net worth is way up.  
Here's what YCharts says:
Higher prices suck, for sure.  But wage growth has been exceeding inflation for about a year now.

 
So do I think it's gonna screw up the economy and investing that wages are growing faster than inflation?  No, I don't.  Sorry.  
If we are talking about personal investing, rather than the unchanging dirge about inflation, here's something odd.  I did think we were about to enter into a correction phase in the S & P.  It has certainly been on a roll.  One reason why, among several, is Glenn Neely, who I have mentioned before. It's all kind of voodoo Neowave theory.  But on big calls, Neely has been correct most of the time.  Like when the 2000 downturn started, and when the GFC started and the market plunged. In both times at the very beginning he said, "Get out!"
So in February he was saying, and I quote, "upside progress should be minimal to non-existent for the rest of this quarter."  He thought Feb. 12 was when the decline would start, since the S & P had the biggest one day drop since this rally started right after Halloween.  I actually closed out about half my shares in SOXL, at something like a 150 % profit.  Although the ones I bought last October and still have got up to about a 200 % profit.
Anyhoo, funny thing.  The market kept going up.  SOXL exploded.  Something about all this investment in chips and new factories that the US is leading the way on.  How did that happen, anyway?  So Neely was wrong, and he has now flipped.  He's now saying the market seems to want to keep going up.  Now he's saying "the S&P will not drop much (even if it wastes time) before beginning a new advancing phase."  Rally on!  I bought 1000 shares of SOXL back, hoping to enjoy the next ride up.
Point is, while this unwavering dirge about inflation has been going on, the stock market has been on fire.  And home prices are going up, too.  Again, average middle class net worth is higher than it has ever been.  Inflation, after it's huge jump from 3.09 % in January to 3.15 % in February, is still below the long term average.
If this is how it works when things suck, can we make it so things suck all the time?  😉

Yep.
I heavily monetized vacation properties during lockdown, leading me to buy additional homes (to rent).
Mexico City, Key West, Galveston, Port Aransas and Puerto Vallarta...  All on airbnb/vrbo.
Haven't touched my portfolio otherwise and it's rebounded from any dip.
 

No.
That's the short answer .  Now here's the diatribe.  I find this fascinating.
It's not a bad idea right now.  If I go by the Yahoo conversations of regular small investors who own the stock, they think maybe in a week after the deal is closed and the psychodrama settles down it could be worth $5.  Somebody who maybe knows what they are talking about says diluted book value is $6.  Or maybe in a year the A Team soon to be in charge will get it to $10.  Mnuchin and pals did this for a reason.  But they got in for $2 a share.  Which is a fire sale price.
Part of my thinking is that what I could buy it for over the last weeks, which averages $3.87 a share, with a 20 cent a year dividend is 5 % a year.  Not bad.  Hold on to it for a few years, and maybe double what I bought it for.  That's what Steve And Friends did on a big scale with Indymac/One West a decade ago.  But there was a press conference at NYCB on the deal at 8 Am today.  And they announced they are cutting the dividend to one cent a quarter.  So it went from 17 cents a quarter to five cents in January, and now to one cent.  How's that for deflation?  
I think what is even more clear today is that this mainly benefits hedge funds.   It helps when you are a former Treasury Secretary, or Comptroller, of course.  And that is a non-partisan investor statement.  Mnuchin's hedge fund is one color, and has a lot of Saudi and Arab wealth in it.  But there is this:
Why private equity has been involved in every recent bank deal
Turns out the PacWest acquisition last year was a $400 million deal for Warburg Pincus.  Same as Steve paid.  Warburg Pincus is run by Tim Geithner.  Name sounds familiar.  Anyone heard of him?  Something about bailouts? 
These Treasury Secretaries sure get around.  And make very powerful friends.  😉
I posted this in part because this is an absolutely fascinating investment story to me.  These people are vultures.  The Yahoo conversation board on this deal is a very fun read.  Most people are small investors like me who just take it for what it is.  Very savvy sharks who have "regulatory bullet proofing" superpowers (I loved that phrase) were allowed into the pool.  And there are a slew of comments from people who have owned the stock for years.  They feel like they were just eaten alive.  And they were.  Their share price is down like 75 % in one year, even after the "rescue."  And their dividend went from 17 cents a quarter to a penny.  Times are hard, I guess.  But if you want evidence that this is a rigged insider game, this is a textbook example. 
Now that I understand how this played out, it does feel an organized bank robbery.  Mnuchin approached the bank, whose Board Chair he has known for a long time, weeks or maybe months ago.  The $2 fire sale price was finalized yesterday when the stock stopped trading.  How convenient that someone leaked this to the WSJ.  And their reporting just happened to create enough fear and panic to get the price down to just about what Steve And Friends obviously wanted to pay.  Such swell guys!  One long-time stock holder posted about how the bank management seems like they have been systematically trying to create as much fear and panic as possible.  Okay.  But why would anyone do that?  🙄
The other reason I posted this is that I think there is good news in all of this for small investors.  If this rolling CRE loan/regional bank "crisis" is what is supposed to cause the recession that wipes out our stock market gains and our home equity, I think it is a dud.  More likely, it is a narrative that can be used by hedge funds to manufacture or at least "enhance" a crisis that doesn't really exist.  At least not yet.
Anecdotally, one analyst asked the CEO of NYCB today what their actual loan delinquency rate on rent-stabilized multi-family mortgages is.  That is what is supposedly causing the problem.  He did not gibe a specific number, but said low.  They said when you underwrite loans conservatively with 50 to 60 % loan to value ratios, the loans tend to perform.  And are performing.  Even when values go down, like they have in New York thanks to COVID and a 2019 pro-tenant law.  Maybe that was all BS from a bank struggling to survive.  But I don't think NYCB is on death's door.  Apparently, neither do Steve And Friends.  I think they are sharks in a feeding frenzy.  And there is more of this to come, as both CNBC articles I posted suggest.  And it's because the vultures and sharks think values are going up, not down.  They want in, for cheap.
The narrative about how festering CRE loans are going to infect more and more banks (this guy says it will take out 500 banks in the next few years) and take the stock market and economy down with it seems like it is mostly bullshit to me.
Here's the Fed's long term chart on all delinquency rates on all business loans by all commercial banks.  Granted, a very broad category.  But delinquencies are lower than ever.  Where's the crisis?
 
Delinquency Rates for Commercial Properties Increased in Fourth-Quarter 2023

That's not great news for banks who make CRE loans.  But if you call it a crisis, it looks like in most categories the crisis has passed.  Or is mostly declining.  It makes sense that in multi-family, there is no crisis.  Higher inflation is caused in large part by higher rents.  How does that hurt landlords of apartment buildings?  The problem with hotels that were vacant during a pandemic is obvious.  But they are not vacant today, if they survived.  The office problem is getting worse.  But it is not a crisis, it seems.  And probably never will be.
Like I said, I think this is mostly good news for small investors.  If some CRE loans go bad, and it makes a regional bank vulnerable, just call Steve And Friends.  Or Tim And Friends.  They are there to help.  They have money we don't have.  And they are always looking for fire sales.  Real, or manufactured.    😉

No.
That's the short answer .  Now here's the diatribe.  I find this fascinating.
It's not a bad idea right now.  If I go by the Yahoo conversations of regular small investors who own the stock, they think maybe in a week after the deal is closed and the psychodrama settles down it could be worth $5.  Somebody who maybe knows what they are talking about says diluted book value is $6.  Or maybe in a year the A Team soon to be in charge will get it to $10.  Mnuchin and pals did this for a reason.  But they got in for $2 a share.  Which is a fire sale price.
Part of my thinking is that what I could buy it for over the last weeks, which averages $3.87 a share, with a 20 cent a year dividend is 5 % a year.  Not bad.  Hold on to it for a few years, and maybe double what I bought it for.  That's what Steve And Friends did on a big scale with Indymac/One West a decade ago.  But there was a press conference at NYCB on the deal at 8 Am today.  And they announced they are cutting the dividend to one cent a quarter.  So it went from 17 cents a quarter to five cents in January, and now to one cent.  How's that for deflation?  
I think what is even more clear today is that this mainly benefits hedge funds.   It helps when you are a former Treasury Secretary, or Comptroller, of course.  And that is a non-partisan investor statement.  Mnuchin's hedge fund is one color, and has a lot of Saudi and Arab wealth in it.  But there is this:
Why private equity has been involved in every recent bank deal
Turns out the PacWest acquisition last year was a $400 million deal for Warburg Pincus.  Same as Steve paid.  Warburg Pincus is run by Tim Geithner.  Name sounds familiar.  Anyone heard of him?  Something about bailouts? 
These Treasury Secretaries sure get around.  And make very powerful friends.  😉
I posted this in part because this is an absolutely fascinating investment story to me.  These people are vultures.  The Yahoo conversation board on this deal is a very fun read.  Most people are small investors like me who just take it for what it is.  Very savvy sharks who have "regulatory bullet proofing" superpowers (I loved that phrase) were allowed into the pool.  And there are a slew of comments from people who have owned the stock for years.  They feel like they were just eaten alive.  And they were.  Their share price is down like 75 % in one year, even after the "rescue."  And their dividend went from 17 cents a quarter to a penny.  Times are hard, I guess.  But if you want evidence that this is a rigged insider game, this is a textbook example. 
Now that I understand how this played out, it does feel an organized bank robbery.  Mnuchin approached the bank, whose Board Chair he has known for a long time, weeks or maybe months ago.  The $2 fire sale price was finalized yesterday when the stock stopped trading.  How convenient that someone leaked this to the WSJ.  And their reporting just happened to create enough fear and panic to get the price down to just about what Steve And Friends obviously wanted to pay.  Such swell guys!  One long-time stock holder posted about how the bank management seems like they have been systematically trying to create as much fear and panic as possible.  Okay.  But why would anyone do that?  🙄
The other reason I posted this is that I think there is good news in all of this for small investors.  If this rolling CRE loan/regional bank "crisis" is what is supposed to cause the recession that wipes out our stock market gains and our home equity, I think it is a dud.  More likely, it is a narrative that can be used by hedge funds to manufacture or at least "enhance" a crisis that doesn't really exist.  At least not yet.
Anecdotally, one analyst asked the CEO of NYCB today what their actual loan delinquency rate on rent-stabilized multi-family mortgages is.  That is what is supposedly causing the problem.  He did not gibe a specific number, but said low.  They said when you underwrite loans conservatively with 50 to 60 % loan to value ratios, the loans tend to perform.  And are performing.  Even when values go down, like they have in New York thanks to COVID and a 2019 pro-tenant law.  Maybe that was all BS from a bank struggling to survive.  But I don't think NYCB is on death's door.  Apparently, neither do Steve And Friends.  I think they are sharks in a feeding frenzy.  And there is more of this to come, as both CNBC articles I posted suggest.  And it's because the vultures and sharks think values are going up, not down.  They want in, for cheap.
The narrative about how festering CRE loans are going to infect more and more banks (this guy says it will take out 500 banks in the next few years) and take the stock market and economy down with it seems like it is mostly bullshit to me.
Here's the Fed's long term chart on all delinquency rates on all business loans by all commercial banks.  Granted, a very broad category.  But delinquencies are lower than ever.  Where's the crisis?
 
Delinquency Rates for Commercial Properties Increased in Fourth-Quarter 2023

That's not great news for banks who make CRE loans.  But if you call it a crisis, it looks like in most categories the crisis has passed.  Or is mostly declining.  It makes sense that in multi-family, there is no crisis.  Higher inflation is caused in large part by higher rents.  How does that hurt landlords of apartment buildings?  The problem with hotels that were vacant during a pandemic is obvious.  But they are not vacant today, if they survived.  The office problem is getting worse.  But it is not a crisis, it seems.  And probably never will be.
Like I said, I think this is mostly good news for small investors.  If some CRE loans go bad, and it makes a regional bank vulnerable, just call Steve And Friends.  Or Tim And Friends.  They are there to help.  They have money we don't have.  And they are always looking for fire sales.  Real, or manufactured.    😉

Keith Fitz-gerald mentioned Boeing again in today's email:

 
4 – The only way Boeing recovers 
Hopes are running high that Boeing’s “back” now that is reportedly in talks to purchase Spirit, which makes the fuselages for Boeing jets. Both manufacturers have been struggling with production problems as they try to turn out Boeing’s top selling plane. (Read) 
Continue to short, avoid or keep on the putskies I suggested a while ago. BA shares are down -21.47% YTD while Airbus and Embraer have returned 9.38% and 17.55% respectively. 
$180 a share, potentially lower. 
I could see $150 without much of a stretch if this keeps up, or down as the case may be. 
MyPOV: The only way forward is a complete reset at the C-level and holding every regulator who signed off on what’s happened to date accountable. Btw, I don’t think I’m off base here; whistleblower Ed Pierson, himself a former senior Boeing manager, believes the entire 737 fleet should be grounded. (Read) 

With a backdoor IRA make sure you don't have any other IRA's before opening or you could really get dinged.   Suze Orman did a suze school podcast a few weeks ago you can find where she talks about it.
I don't really understand why they have an income limit anyway on a roth IRA seeing there isn't one for a roth 401K.   I'm fortunate enough to have a roth option for my 401K that was added two years ago, but would have loved a higher contribution limit for the IRA for those years I didn't have a roth 401K option.
If you qualify for a roth IRA, I'd put the max in you can for the match into the 401K since it's basically free month and the next $8K into a roth IRA and then go back to the 401K for additional money.   
Some companies also have the option for a roth 401K match to be taxed instead of going into a traditional account and you can avoid paying taxes on those earnings as well
 

There was an interesting bailout of New York Community Bank today.   It has a quaint smallish sounding name.  But it's the 35th largest bank in America, having merged with Flagstar and taken over some of the assets of failed Signature Bank in the last few years.
Beyond being one bank in trouble, for CNBC and Fox Business, NYCB has come to represent the (maybe) looming national problem of distressed commercial real estate.  And the distressed regional banks that hold much of the distressed CRE loans.  If you told me we are going to have a recession in the next year or two, and I have to guess why, I would go with some CRE loan contagion as my explanation.  Something like the subprime lending mess that caused the Great Recession.  Except this time involving multi-family housing and office buildings.  Instead of Ms. Middle America getting foreclosed on, or seeing half her home equity suddenly vaporized.
Anyway, what happened today suggests that distressed CRE loans will not be causing a recession anytime soon.  What they will most likely end up causing is a hugely profitable feeding frenzy for hedge funds and rich investors.  Including former Treasury Secretaries, as it turns out.
MARKETS
NYCB shares rebound after troubled regional bank announces $1 billion capital raise
On a personal level, I'll explain it this way.  I was a very highly regarded hooker for many years.  But I never would have guessed at some point I would jump in bed with Steve Mnuchin.  Today I did.  And I'm grateful.  I woke up owning 8,000 shares of NYCB.  All of which I bought in the last few weeks at what I thought were  fire sale prices averaging about $4 a share.  I'll go to bed owning 10,000 shares that cost about $3.80 a share and pay a 5 % dividend.  And will likely go up a lot in the next few years.  But at one point today I had a 40 % intraday loss.  And I figured I was going to lose everything.  Until Steve suddenly jumped in bed with me.  Or something like that.  What a guy!  And it was a threeway, too.  He even brought the former Comptroller in bed with him.  Woo hoo!
NYCB is a bit of an outlier.  Because about half of its loans are in multi-family buildings, about half of which are rent-stabilized.  So the combination of tight rent increase controls and high interest rates when landlords have to refi is not a good match.  And it will cause rising delinquencies at the banks that own these loans as they have to be refinanced at higher rates in 2024 and 2025.  That's what started the freefall for NYCB.  It was worth over $10 in January.  But only $1.70 at one point today before they stopped trading.
There probably is going to be a lot more of this in the next few years.  Especially with office buildings.  I have a hard time seeing how landlords (I am one) are being screwed by a national affordable housing crisis.  But I can see the problem with having to refi loans on multi-family buildings at high interest rates.  Which won't go away anytime soon.  The real problem, most analysts say, is the office buildings and commercial structures.  Whether those office buildings or malls ever get back to the good old days is a good question.  Like I said, if there is any recession risk out there, this is what I'd put at the top of the list.  Some kind of financial contagion.
Hedge funds bet on U.S. real estate rebound
That article was written two days ago.  What Team Mnuchin and his hedge fund buddies did today is proof of concept.  I don't think what happens at hedge funds drives the needle on whether we have a recession or not.  That said, the word "rebound" is appropriately placed in that headline.  My guess is that hedge funds and various investors (even the old dudes like Warren Buffet) will step in and make killings on distressed CRE loans.  They are raising the money to do so now.  It may not be good news for some commercial real estate owners, or some regional banks  But if you're not one of them, who cares?  You can make a good argument that the macro effect for the rest of us is economic recovery.  Not recession. Real estate rebounds don't usually cause recessions.
One final point.  For those of us who think investing is a rigged game, this is a great example.  They stopped trading on NYCB when the shares had tanked about 40 % in a  few hours.  After the Wall Street Journal reported that NYCB was seeking a capital infusion.  Meaning they were probably near death's door.   Then about an hour later this long press release shows up.  I have to imagine this deal was in the works for days or weeks.  Steve And Friends get something like half a million shares of the bank they will revive at $2.  The rest of us normal people can buy it $3.50, if we are willing to take the risk.  If you owned it last year, you're fucked.  For now at least.  Woo hoo!  Steve and Friends did this at Indymac a decade ago.  They sold that bank for double what they bought it for, and went on to be Treasury Secretary and Comptroller.  And now they are about to own half or so of the 35th largest bank in the US for $2 a share.  But that's not a rigged game, is it?   🤔
I just want to know whether it was Steve, or a friend, who leaked the story to the Wall Street Journal.  Which set up the final rollercoaster ride today.  There are people on Yahoo message boards who still think the bank will fail.  Somehow, when the former head of the OCC ends up running the bank the OCC regulates, that just seems rather unlikely.
This is what makes America, and capitalism, what it is.  Ya gotta love it.
 

There was an interesting bailout of New York Community Bank today.   It has a quaint smallish sounding name.  But it's the 35th largest bank in America, having merged with Flagstar and taken over some of the assets of failed Signature Bank in the last few years.
Beyond being one bank in trouble, for CNBC and Fox Business, NYCB has come to represent the (maybe) looming national problem of distressed commercial real estate.  And the distressed regional banks that hold much of the distressed CRE loans.  If you told me we are going to have a recession in the next year or two, and I have to guess why, I would go with some CRE loan contagion as my explanation.  Something like the subprime lending mess that caused the Great Recession.  Except this time involving multi-family housing and office buildings.  Instead of Ms. Middle America getting foreclosed on, or seeing half her home equity suddenly vaporized.
Anyway, what happened today suggests that distressed CRE loans will not be causing a recession anytime soon.  What they will most likely end up causing is a hugely profitable feeding frenzy for hedge funds and rich investors.  Including former Treasury Secretaries, as it turns out.
MARKETS
NYCB shares rebound after troubled regional bank announces $1 billion capital raise
On a personal level, I'll explain it this way.  I was a very highly regarded hooker for many years.  But I never would have guessed at some point I would jump in bed with Steve Mnuchin.  Today I did.  And I'm grateful.  I woke up owning 8,000 shares of NYCB.  All of which I bought in the last few weeks at what I thought were  fire sale prices averaging about $4 a share.  I'll go to bed owning 10,000 shares that cost about $3.80 a share and pay a 5 % dividend.  And will likely go up a lot in the next few years.  But at one point today I had a 40 % intraday loss.  And I figured I was going to lose everything.  Until Steve suddenly jumped in bed with me.  Or something like that.  What a guy!  And it was a threeway, too.  He even brought the former Comptroller in bed with him.  Woo hoo!
NYCB is a bit of an outlier.  Because about half of its loans are in multi-family buildings, about half of which are rent-stabilized.  So the combination of tight rent increase controls and high interest rates when landlords have to refi is not a good match.  And it will cause rising delinquencies at the banks that own these loans as they have to be refinanced at higher rates in 2024 and 2025.  That's what started the freefall for NYCB.  It was worth over $10 in January.  But only $1.70 at one point today before they stopped trading.
There probably is going to be a lot more of this in the next few years.  Especially with office buildings.  I have a hard time seeing how landlords (I am one) are being screwed by a national affordable housing crisis.  But I can see the problem with having to refi loans on multi-family buildings at high interest rates.  Which won't go away anytime soon.  The real problem, most analysts say, is the office buildings and commercial structures.  Whether those office buildings or malls ever get back to the good old days is a good question.  Like I said, if there is any recession risk out there, this is what I'd put at the top of the list.  Some kind of financial contagion.
Hedge funds bet on U.S. real estate rebound
That article was written two days ago.  What Team Mnuchin and his hedge fund buddies did today is proof of concept.  I don't think what happens at hedge funds drives the needle on whether we have a recession or not.  That said, the word "rebound" is appropriately placed in that headline.  My guess is that hedge funds and various investors (even the old dudes like Warren Buffet) will step in and make killings on distressed CRE loans.  They are raising the money to do so now.  It may not be good news for some commercial real estate owners, or some regional banks  But if you're not one of them, who cares?  You can make a good argument that the macro effect for the rest of us is economic recovery.  Not recession. Real estate rebounds don't usually cause recessions.
One final point.  For those of us who think investing is a rigged game, this is a great example.  They stopped trading on NYCB when the shares had tanked about 40 % in a  few hours.  After the Wall Street Journal reported that NYCB was seeking a capital infusion.  Meaning they were probably near death's door.   Then about an hour later this long press release shows up.  I have to imagine this deal was in the works for days or weeks.  Steve And Friends get something like half a million shares of the bank they will revive at $2.  The rest of us normal people can buy it $3.50, if we are willing to take the risk.  If you owned it last year, you're fucked.  For now at least.  Woo hoo!  Steve and Friends did this at Indymac a decade ago.  They sold that bank for double what they bought it for, and went on to be Treasury Secretary and Comptroller.  And now they are about to own half or so of the 35th largest bank in the US for $2 a share.  But that's not a rigged game, is it?   🤔
I just want to know whether it was Steve, or a friend, who leaked the story to the Wall Street Journal.  Which set up the final rollercoaster ride today.  There are people on Yahoo message boards who still think the bank will fail.  Somehow, when the former head of the OCC ends up running the bank the OCC regulates, that just seems rather unlikely.
This is what makes America, and capitalism, what it is.  Ya gotta love it.
 

Paying attention to PE is a good idea.  Interestingly, NVDA's PE has gown down drastically recently.  The stock has soared, but earnings have soared even more.  It actually has a lower PE than most its peers.   Its largest supplier is TSMC, based in Taiwan. 
Kevin Slater

I was curious.  So I Googled his name and "Boeing" and came up with this post from Jan. 29 in which he lays out his concerns about Boeing.  As you say, all his investment advice sounds spot on.
Buy defense stocks
GOL, one of Brazil's largest airlines, did just go bankrupt.  They were actually doing okay in terms of operating costs, given the global recovery.  But their problem was all the debt they got loaded up with during the pandemic.  Boeing is somewhat in the same ballpark, according to FT.   Fitz-Gerald sounds right in saying the pain probably is not over.
One thing I did learn is that when I read the word "bankruptcy" in print, I should believe it.  Some Brazilian financial newspaper leaked that GOL was considering filing for bankruptcy, which led to an immediate huge intraday drop.  The company issued a statement saying they were in negotiations, blah blah blah, and nothing would happen in January.  So the stock recovered to pretty much where it had been.  During that brief recovery, I sold half my shares at a small profit.   I figured I had a few weeks to sell the rest for a little more, if the recovery continued.  Then they unexpectedly filed for bankruptcy on Jan. 25.  They essentially admitted they lied about their timeline once the news leaked that bankruptcy was in fact imminent, to stay ahead of the curve.  I'm kicking myself for not selling everything.  But when I net out what I made in short term gains over several years riding that wave, I came out with only a small loss.
I like what Fitz-Gerald says about defense stocks.  I bought RTX late last year and am up about 12 % as of today. Every once in a while going back half a century Raytheon's value drops 30 to 50 %.  In this recent case, like Boeing, mostly due to their own errors.  And it is always a good time to buy, because they always recover.  Unlike GOL, which was a failed exercise in market timing, that is one I bought for the reason Fitz-Gerald said.  It is a long cycle investment with a decent dividend.
Where he sounds particularly spot on is that all tech is not the same.  And, mostly, the bigger the better:  like AAPL and MSFT, which he mentions.  It seems like this market is all tech, all the time.  I got a big cash windfall when I sold a rental home last August.  The shares of AAPL I bought then are up about 5 %.  Not bad.  The shares in FNGU and SOXL, which are 3x bullish ETFs, are both up about 75 %.  It's all the big tech names, AAPL, MSFT, NVDA.  What could possibly go wrong?
If you bought Boeing when the S & P 500 peaked in 2000, you would have done just as well as buying it or the S & P.  Both are up a little more than 3x their 2000 high.  RTX is more like 5x its 2000 value.  Microsoft, one of the big winners of the 2000 tech bubble, is now worth 7x its 2000 value.  Apple comes in at about 140x its 2000 value.  Again, it seems like all tech, all the time.
That said, at some point the tech trip is going to get very bumpy.  And when it goes bad it will feel like being on one of those Boeings when the doors blow out mid-flight.  Happily, it's easier to parachute out of tech stocks than it is a Boeing jet.  Meanwhile, enjoy the blue skies!
 

As good as Fellow Travelers is in so many ways, I'm struggling to get through the series because of all the ugliness.  I love Jonathan Bailey, both for his performance and his nerdy sex appeal, I love the whole cast really, love the script, direction, and production quality, but as someone posted previously, forget how awful McCarthy et al were to gays (as if that weren't bad enough) -- how could we be so awful to each other??
I'm almost done with Ep 5, 3 more to go, but it's been the most difficult series I've ever watched.

We can afford the spending - according to IMF data the US spending per GDP is significantly lower than other developed countries. The problem is we are not paying for the spending…we are funding it through lending, which explains the 13% of federal funding that goes towards interest in the chart above. So, if we did something sensible like …that would remove the interest charge and get rid of the loans. Win…win. 🤓

Here is a breakdown of federal spending from the US treasury. Which category would you like to cut back on?

Finally finished the last episode last night.  If the measure of great film is it makes you think and feel a lot, including lots of conflicted feelings, this was an LGBTQ masterpiece.  But also a very hard watch.  Even though both male leads are adorable eye candy.  Do they have an award for eye candy that is nevertheless painful to watch?  🤔  Matt and Johnny  deserve awards for that alone.  As well as for their subtle performances.
I ended up reading Reddit discussions of each of the last three episodes, since I was curious what others thought.  Some thought Hawk was a selfish monster who never really loved anyone.  Others thought he was madly in love, but it always came out sideways.  Pretty much everyone loved Tim.  Although several people got the memo that Hawk's actions in the 50's had a certain cruel logic to them.  Given that government and society were breathing down the necks of men who loved men.
I found the 60's and 70's episodes particularly frustrating.  The world was literally on fire.  And Nyswaner situated Tim and the supporting characters right in the middle of these freedom movements.  But most of the plot was about how Hawk and his family were trapped, and lost, in a cage of Hawk's own creation.  I kept wanting those episodes to be about Tim, and how he was changing.  That actually could make a good sequel.  But I understand why the focus was on how Hawk was stuck.  In some alternative Gay universe, this movie will win a porn award for the most horrific three way ever. 🤢
Given that none of this was in the book, it was necessary to take the movie where it wanted to go.  Which was a path to repentance and redemption for Hawk.  That was very moving, even if Hawk was not easy to love.
The film went to very emotionally searing places that the book didn't.  I think it will stand as a masterpiece and memorial to all the lives and loves that were lost due to homophobia and hate.  Including internalized homophobia, and self-hatred.  So the ending fit quite well. Hate you, Roy.  Love you, Tim. 
And I'm delighted that Matt Bomer gets to live the life the character he played never did.  That - and all the lives and love and commitment that went into making it even possible - redeems everything.

I thought this article by Fisher Investments was interesting, since so many of us are Boomers.
Putting the ‘Boom’ in Boomer Retirements
That deals more with a secular trend that will be with us for a while, as opposed to immediate recessionary pressures.  That said, I think it is another reason the economy is holding up.  These reports about how net worth went up by a third, on average, are talking about the Boomers.  Net worth went up for Gen Z, too.  But the actual number oi dollars that means is a fraction of what the Boomers got when their homes and stocks went up by a third.  And, as this report says, they are spending it.  Now.
A lot of what I read suggests that if the economy depended on Gen Z and Millennials, we probably would be in a recession.  They are the best educated generation ever.  And their average incomes and potential show it.  But they are getting the brunt of all the bad stuff right now.  Rents are up.  Food and gas prices are up.  Daycare is up.  Expanded child tax credits are gone.  College loans are coming back.  Typical of people just starting out, they have minimal net worth.  Meanwhile, Boomers own homes with no mortgages or low fixed rate mortgages, and stocks portfolios, worth in the hundreds of thousands on average.
Life is not unfair to Gen Z and Millennials.  When I was their age, and starting to buy real estate, fixed rate mortgages cost more than today's vastly inflated rates.  They will do fine, eventually.  But we can thank Baby Boomers for keeping us out of a recession.  

I thought this article by Fisher Investments was interesting, since so many of us are Boomers.
Putting the ‘Boom’ in Boomer Retirements
That deals more with a secular trend that will be with us for a while, as opposed to immediate recessionary pressures.  That said, I think it is another reason the economy is holding up.  These reports about how net worth went up by a third, on average, are talking about the Boomers.  Net worth went up for Gen Z, too.  But the actual number oi dollars that means is a fraction of what the Boomers got when their homes and stocks went up by a third.  And, as this report says, they are spending it.  Now.
A lot of what I read suggests that if the economy depended on Gen Z and Millennials, we probably would be in a recession.  They are the best educated generation ever.  And their average incomes and potential show it.  But they are getting the brunt of all the bad stuff right now.  Rents are up.  Food and gas prices are up.  Daycare is up.  Expanded child tax credits are gone.  College loans are coming back.  Typical of people just starting out, they have minimal net worth.  Meanwhile, Boomers own homes with no mortgages or low fixed rate mortgages, and stocks portfolios, worth in the hundreds of thousands on average.
Life is not unfair to Gen Z and Millennials.  When I was their age, and starting to buy real estate, fixed rate mortgages cost more than today's vastly inflated rates.  They will do fine, eventually.  But we can thank Baby Boomers for keeping us out of a recession.  

I thought this article by Fisher Investments was interesting, since so many of us are Boomers.
Putting the ‘Boom’ in Boomer Retirements
That deals more with a secular trend that will be with us for a while, as opposed to immediate recessionary pressures.  That said, I think it is another reason the economy is holding up.  These reports about how net worth went up by a third, on average, are talking about the Boomers.  Net worth went up for Gen Z, too.  But the actual number oi dollars that means is a fraction of what the Boomers got when their homes and stocks went up by a third.  And, as this report says, they are spending it.  Now.
A lot of what I read suggests that if the economy depended on Gen Z and Millennials, we probably would be in a recession.  They are the best educated generation ever.  And their average incomes and potential show it.  But they are getting the brunt of all the bad stuff right now.  Rents are up.  Food and gas prices are up.  Daycare is up.  Expanded child tax credits are gone.  College loans are coming back.  Typical of people just starting out, they have minimal net worth.  Meanwhile, Boomers own homes with no mortgages or low fixed rate mortgages, and stocks portfolios, worth in the hundreds of thousands on average.
Life is not unfair to Gen Z and Millennials.  When I was their age, and starting to buy real estate, fixed rate mortgages cost more than today's vastly inflated rates.  They will do fine, eventually.  But we can thank Baby Boomers for keeping us out of a recession.  

I agree that RTX is a solid company however it is not the same as Raytheon.   Raytheon merged with UTC which ultimately is guiding the ship IMO.
That said, RTX seems agile and their products are impressive.
I'd buy RTX before Boeing, mostly because Boeing manages on the cheap IMO. 
Driving costs down is important but has Boeing taken their eye off the ball?  

I wish Jamie Dimon would end his interviews saying "Since I'm consistently wrong with my economic predictions...who really knows?"

I agree with your nephew that COVID money was a factor.  I assumed it was  one factor why prices rose.  But yeah it makes sense the economy would hum with COVID money being spent.
I see Jamie Dimon has altered his "recession is coming, there are bad things ahead" language to "the US is driving towards a cliff due to the national debt."  I suppose that helps his image by letting go of the "recession" word.   
The US "driving off a cliff" sounds more like the great, terrible unknown.  Could be a recession, but who knows?
I wish Jamie Dimon would end his interviews that way, saying "Who really knows?",  with an exaggerated shoulder shrug.

 
 
 
 
 
 

So here is a very interesting chart from the latest report of the Conference Board on the leading economic index.  The LEI is supposed to help indicate when a recession is ahead of us.

Bad news, and good news.
Bad news is that, in oversimplified terms, whenever the blue line meets the red line on the way down, we know a recession is imminent.  So since we are under the red line,  we are either now - or about to be - in a recession.  in theory.
Good news:  In fact, does anyone notice the problem?
In 2001, 2008, and 2020, the simple idea worked.  When the LEI hit that red line, we were already in a recession in two of the three examples.  In the 9/11 recession, by the time the LEI bottomed its "V" at about -12 the recession had started.
Yet this time, we hit that red line over a year ago, in 2022.  Which is why we have heard so much about a recession coming.  For over a year.  And yet, where is it? 
Meanwhile, the LEI appears to have bottomed and is back on its way up.  The chart above slightly understates the case for optimism.  I could not cut and paste the Dec. 2023 image from the report.  So that image above is from October 2023, which I found online and could cut and paste.  The December chart shows the blue line kept rising at the end of 2023, and is now near the red line ON THE WAY UP.  Meaning perhaps the danger has passed?
Here is what the report itself says about a 2024 recession:
So we are not out of the woods yet, according to the Conference Board.  But we have heard this song before.  And what they are talking about now - two quarters of slightly negative growth - is the shortest and shallowest of recessions imaginable.  in theory.  If it actually happens.
What's interesting is that the strongest indicators for both optimism and pessimism are pretty subjective.  The most bullish indicator is that the stock market is on a tear.  The most pessimistic indicator is that public opinion about the economy is, and has been, so pessimistic.  Yet it is clear that, right now, both the stock market and public opinion about the economy are going up - not down.  So on both a leading indicator for optimism and a leading indicator for pessimism, the bulls seem to winning.
I will mention again a key fact I cited above:  when asked about their personal financial prospects in 2024, 2 in 3 Americans say they think they will be better off financially this year.  That may be telling us something, too.
I've been dissecting this with my stock geeky nephew, and we have two different theories.  Both of which are plausible.  He thinks it's all that COVID stimulus money and "forced savings" that is still not spent out.  I think it's the fact that, as I have posted repeatedly, consumer debt as a percentage of disposal income is at a relative low, not a high.  Whether you like the idea or not, consumers have a lot more credit they could take on to fuel an expanding recovery.   Maybe the stock market knows this.

 

Of recent movies that have been commented on extensively here, I think the interesting comparison is between RWRB and Saltburn.  For me, Saltburn is a celebration of cynicism and excess which, like many others, I did not like.  I loved RWRB for what I think both the book and film were meant to be:  a sweet and positive LGBTQ fairy tale. 
And mind you, it's not a Gay fairy tale.  The woman who wrote it wanted to be clear there's a B in LGBTQ.  These PC queers are insufferable, aren't they?  🙄  But I know some people didn't like the movie because it was so PC.  Perhaps being a possibly closeted homosexual (or sociopathic bisexual?) stalking a rich party boy is more interesting?  Who knows.  If I want The Talented Mr. Ripley, I can get a much better version of it.  By watching The Talented Mr. Ripley.
That said, there is no competition in one sense.  Taylor and Nick were stingy.    Yes, there was that dreamy look in Nick's eyes as he was penetrated. 

But only Jacob Elordi offered us an opportunity to lick his cum off the bathtub.  That counts for something.

Here's a third film to compare and contrast:  All Of Us Strangers.  Arguably, it is darker than Saltburn.  But only in the sense that, unlike Saltburn, it evokes real emotions about the Gay experience that anyone the age of the director or older can immediately relate to.  Like having to worry about bullies who dislike queer boys.  Or, worse, being the queer young man dying of AIDS.
Watching All Of Us Strangers, which is elegant and finely acted cinema in a way RWRB is not,  helped me realize why I really did love RWRB.  For the reasons I think the writer and director intended.  It is a positive story about the power of love.  And how we won, based on our willingness to fight for our love. 
You kind of get that from All Of Us Strangers.  You can have a really interesting debate, which director Andrew Haigh also intended, about whether and how Andrew Scott won his love at the end of the movie.  In RWRB, there was no question about who won who, and why. Like Heartstoppers, it's a wildly optimistic hug that now even The Gays acn win the love they truly want.
Happily, these days the kind of open and committed queer love portrayed in RWRB actually seems like real life, not a fairy tale.  And All Of Us Strangers feels like the true and real ghost story from the less fantastic LGBTQ past that will always haunt many of us.
The Queer Kids Are All Right. And Now They’re Making Me Better.
I'll end with that article.  I hope the hyperlink works.  It's a shared article someone posted on a different website.  It mentions RWRB, All of Us Strangers, and a lot of other recent LGBTQ movies. 
I like the author's idea that one function of these movies is that they offer a sort of "emotional reparations" for the double doses of love and support a lot of us did not necessarily get growing up.  Fellow Travelers certainly comes to mind, too, as a recent example of making wrongs right.  At least in cinema.   Of course, I understand why "reparations", even of an emotional sort, might not be a welcome idea among many.