Financial Review

Monday, Maybe

Sinclair Noe — September 22, 2017

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SPX + 1 = 2502
NAS + 4 = 6426
RUT + 6 = 1450
10 Y – .02 = 2.26%
OIL + .11 = 50.66
GOLD + 6.50 = 1298.10

Top Cryptocurrencies

	Name	Symbol	Price USD	Market Cap	Vol.	Total Vol. %	Price BTC	Chg. % 1D	Chg. % 7D
	Bitcoin	BTC	3,625.6	$60.47B	$1.18B	42.84%	1	+0.75%	-1.90%
	Ethereum	ETH	263.70	$25.09B	$405.81M	14.78%	0.0730023	+0.58%	3.57%
	Bitcoin Cash	BCH	410.63	$6.85B	$226.51M	8.25%	0.113792	+0.40%	-3.41%
	Ripple	XRP	0.17235	$6.61B	$34.62M	1.26%	0.00004755	-0.35%	-6.26%
	Dash	DASH	345.00	$2.61B	$69.79M	2.54%	0.0951904	+1.07%	17.61%
	Litecoin	LTC	47.230	$2.52B	$216.55M	7.89%	0.0130959	-1.21%	-5.23%
	NEM	XEM	0.20813	$1.89B	$2.88M	0.10%	0.00005792	+1.80%	-3.43%
	IOTA	MIOTA	0.51489	$1.43B	$8.98M	0.33%	0.00014143	+1.96%	3.79%
	Monero	XMR	87.75	$1.33B	$27.17M	0.99%	0.0242851	+0.29%	-13.39%
	Ethereum Classic	ETC	10.2433	$981.34M	$29.54M	1.08%	0.00282523	+0.42%	-3.95%

Is that true? Is it possible that the Dow Industrial Average went down for two consecutive sessions? It has been about a month since we have had back to back loses on the Dow. For the week, the Dow rose 0.4%, the S&P rose 0.1%, and the Nasdaq fell 0.3%.

Sen. John McCain announced today in a statement that he cannot “in good conscience” vote for the GOP’s latest plan to overhaul Obamacare, likely ending Republicans’ latest effort to repeal and replace the Affordable Care Act.

McCain wrote: “I believe we could do better working together, Republicans and Democrats, and have not yet really tried. Nor could I support it without knowing how much it will cost, how it will (affect) insurance premiums, and how many people will be helped or hurt by it. Without a full CBO score, which won’t be available by the end of the month, we won’t have reliable answers to any of those questions.”

McCain’s “no” vote means it is likely Republicans won’t be able to repeal and replace Obamacare before September 30, as Sen. Rand Paul of Kentucky said he would not back Graham-Cassidy and Sen. Susan Collins of Maine has said she is leaning “no” on the proposal. But there are still questions as to where Alaska Sen. Lisa Murkowski now.

Bottom line, 3 no votes kills the Graham-Cassidy bill but it won’t really die – not yet. Republicans can now write and pass another budget for fiscal 2018 that uses the same reconciliation procedure for health care legislation.

The trick would be combining it with a major tax overhaul, since the GOP is aiming to use reconciliation for that as well. Senate Finance Committee Chairman Orrin Hatch said today there’s “a chance” of combining the two efforts in a 2018 budget resolution.

McCain torpedoed the last GOP bill in July, returning to the Senate after being diagnosed with brain cancer only to cast a surprising and dramatic 50th vote against a limited-repeal of Obamacare offered by Majority Leader Mitch McConnell. But until today, he was officially undecided on the Graham-Cassidy proposal, apparently torn between his disgust for the party’s rushed, partisan legislative process and his famously close friendship with Graham, its most vocal salesman.

McCain acknowledged that his friendship with Graham put him in a difficult spot. “I take no pleasure in announcing my opposition. Far from it,” he said. “The bill’s authors are my dear friends, and I think the world of them. I know they are acting consistently with their beliefs and sense of what is best for the country. So am I.”

After the announcement, Graham tweeted: “My friendship with @SenJohnMcCain is not based on how he votes but respect for how he’s lived his life and the person he is.” Absolutely correct.

The latest repeal and replace defeat deepens doubt surrounding the GOP’s ability to get healthy on tax reform. The Senate’s late-July rejection of the initial push to repeal and replace Obamacare gave Republicans a chance to cut their losses. Congress could have begun a limited bipartisan effort to stabilize insurance marketplaces – which have grown in popularity during this year’s repeal battle — while the GOP moved on to the tax debate that unites the party more.

The much-anticipated tax plan crafted by the Trump administration and Republican congressional leadership is expected to be unveiled Wednesday, and that could provide positive momentum for stocks in the final week of the quarter. The S&P 500 is up 3.3 percent for the quarter so far. The Dow is up more than 4.6 percent for the quarter. The Nasdaq is up 4.7 percent for the quarter.

From what we have learned about the Graham-Cassidy bill, it wasn’t any better than earlier repeal efforts, and maybe worse. The ACA has plenty of problems but those problems would not be corrected by Graham-Cassidy. It probably didn’t help that all 50 Medicaid directors – that is every state – opposed the GOP’s latest health care bill, and a Brookings report indicated at least 21 million would lose insurance.

Have you heard that the world will end tomorrow? I am not making this up, someone else is. The Armageddon rumors sparked when a Christian numerologist called David Meade suggested Nibiru would plough into our planet on September 23. It’s all over the inter-webs.

Meade says Arizona is a good place to survive the collision. I don’t really know why that is. But I think, if there was a mystery planet headed for a collision with Earth, we might have seen it by now. So, will the world end tomorrow? Computer says… no.

But the People’s Democratic Republic of Korea might just blow up a hydrogen bomb in the Pacific Ocean. On Tuesday, during his speech at the United Nations, President Trump said his government would “totally destroy North Korea” if necessary to defend the United States or its allies.

On Friday, Kim Jong Un responded, saying North Korea “will consider with seriousness exercising of a corresponding, highest level of hard-line countermeasure in history.” The North Korean leader didn’t elaborate on the nature of this countermeasure, but his foreign minister provided a hint: North Korea might test a hydrogen bomb in the Pacific Ocean.

Atomic weapons are typically tested underground. An explosion on or above water would have nasty repercussions. More than 60 years after the United States tested a series of atomic bombs near Bikini Atoll in the Marshall Islands, the island remains “unlivable”.

There are signs that Mexico and Canada are increasingly less worried by the idea of the North American Free Trade Agreement (NAFTA) falling apart. Mexico’s foreign minister Luis Videgaray says “Mexico is much bigger than NAFTA,” arguing that an average 3% increase in tariffs that he thinks would come if NAFTA ended wouldn’t stop trade with the US. With negotiations among the US, Mexico, and Canada due to resume this weekend, he went further: “If NAFTA goes away…it’s not the end of the world.”

Shares of Sprint gained about 6% and T-Mobile gained about 1%, after Reuters said the companies are close to agreeing to tentative terms on a merger. Japan’s Softbank Group, Sprint’s majority shareholder, will own 40% to 50% of the combined entity. T-Mobile parent Deutsche Telekom will own a majority stake.

Apple launched its new line of smartphones and watches, and turned in their worst weekly performance for the week of a major product launch since the original iPhone was released back in 2007, following less-than-stellar product reviews.

There has been a tendency for Apple to slip after a product launch – buy the hype and sell the reality – but this week was particularly bad as Apple dropped 5%. That’s a loss of $50 billion dollars in market cap – Still, many investors are looking at it as a chance to buy.

On Tuesday, shares barely managed a gain after ho-hum iPhone 8 reviews. On Wednesday, shares dropped 1.7% after a few prominent Apple Watch Series 3 reviews complained about spotty connectivity, an issue Apple acknowledged it was seeking to solve. Thursday’s 1.7% decline followed an announcement that Google is spending $1.1 billion on a cooperation agreement with smartphone manufacturer HTC to produce the Pixel smartphone.

The FAANG companies – Facebook, Apple, Amazon.com, Netflix and Google holding company Alphabet have been able to put up stellar growth numbers for quite some time, without competing very much with each other. That’s starting to change.

Consider the case of Oracle, which announced fairly solid growth in its cloud business but offered up weak guidance – shares were slammed. It looks like Oracle might not have a big slice of the Cloud Pie. That leaves Amazon and Google, and maybe Microsoft to slug it out.

Google is investing in smartphones to battle it out with Apple. Facebook has been vying with Google over ad clicks. Amazon and Google are fighting over which device will power your home – Alexa or Google assistant. And how will you watch TV in the future? On YouTube, Apple TV, Amazon Instant video, or Netflix, which now comes complimentary with a subscription on T-Mobile.

The most amazing thing of all is that it has taken us the better part of two decades to arrive at a moment when tech companies actually see themselves as competitors. It will be very interesting to see how this new-found competition plays out because the future of the FAANGs is going to tell us a lot about the future of Wall Street, considering the FAANGs represent over $3 trillion in market capitalization — roughly 13% of the entire S&P 500.

London is one of Uber’s largest and most lucrative markets, with 40,000 drivers and 3.5 million people who use the app once every 90 days. But that number may soon be reduced to zero. The city’s regulator, Transport for London, said it denied the license because Uber’s “approach and conduct demonstrate a lack of corporate responsibility.”

Its license will expire on Sept. 30, although the company has 21 days to appeal—which it intends to do—and can carry on operating during the appeal process. The move is a win for taxis, but maybe not so much for customers.

The federal government told election officials in 21 states, including Arizona, that hackers targeted their systems last year, although in most cases the systems were not breached.

The government told The Associated Press last year that more than 20 states were targeted by hackers believed to be Russian agents before the 2016 elections. But for many states, the calls Friday from the Department of Homeland Security were the first official confirmation of whether their states were on the list.

Financial Review

Get Out Now

Sinclair Noe — August 29, 2017

Podcast: Play in new window | Download (Duration: 13:15 — 7.6MB)

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DOW + 56 = 21,865
SPX + 2 = 2446
NAS + 18 = 6301
RUT + 2 = 1384
10 Y – .02 = 2.14%
OIL – .11 = 46.33
GOLD – .90 = 1309.60

Top Cryptocurrencies

	Name	Symbol	Market Cap	Vol.	Total Vol. %	Price USD	Price BTC	Chg. % 1D	Chg. % 7D
	Bitcoin	BTC	$75.55B	$2.47B	39.17%	$4,570.05	1	4.16%	11.44%
	Ethereum	ETH	$34.80B	$1.23B	19.50%	$368.92	0.0804136	6.04%	16.67%
	Bitcoin Cash	BCH	$9.19B	$378.75M	6.00%	$555.00	0.120972	-6.85%	-18.03%
	Ripple	XRP	$8.36B	$263.40M	4.18%	$0.22	0.00004749	-0.95%	-14.85%
	Litecoin	LTC	$3.31B	$289.75M	4.59%	$62.90	0.013705	0.71%	34.86%
	Dash	DASH	$2.71B	$47.44M	0.75%	$359.73	0.0783784	-0.03%	23.92%
	NEM	XEM	$2.55B	$7.86M	0.12%	$0.28	0.00006186	1.07%	14.68%
	IOTA	MIOTA	$2.27B	$28.66M	0.45%	$0.82	0.00017765	-5.96%	-4.43%
	Monero	XMR	$2.00B	$173.82M	2.76%	$133.00	0.0289786	-6.70%	48.45%
	NEO	NEO	$1.70B	$169.91M	2.69%	$34.06	0.00742472	-10.70%	-4.74%

A pair of 70-year-old reservoir dams that protect downtown Houston and a levee in a suburban subdivision began overflowing Tuesday, adding to the rising floodwaters from Harvey. The dams did not break, but they are overflowing, meaning the flooding is just getting worse.

Brazoria County authorities posted a message on Twitter – “GET OUT NOW!!!” (all caps – 3 exclamation points).

A weather station southeast of Houston reported 49.32 inches of rain as of Tuesday morning. Already 14 sites in Houston have recorded more than 40 inches of rain and 36 different locations have recorded more than 3 feet. Harvey now officially holds the US record for most total rainfall from a tropical system, and it hasn’t left the area yet.

Rivers around Houston crested last night and today, several areas are reporting water 25 feet above flood level. At least 14 people are reportedly dead in the Houston area, including a family of six who are thought to have drowned in a van and a police officer who drowned in his patrol car. Many folks have lost touch. Undoubtedly, the death count will rise.

The phase of immediate recovery, still unfolding in Houston, includes search-and-rescue and providing temporary shelters. The latest estimates are that more than 30,000 will need temporary shelter.

Immediately after a large-scale disaster, infrastructure known to engineers as “lifeline systems” – power, transit and communications – must be restored. In Houston, as many as 100,000 are without power, and all service was suspended on the local public transit system. Major roadways are underwater and will remain impassable for several weeks to several months.

Also among the near-term challenges are securing critical facilities and bringing them back online, including fire and police stations, hospitals, nursing homes and schools. Water and sewer systems and debris clearance are next on the list. Something as simple as trash collection has stopped for the past 5 days.

Early estimates suggest the financial damage has already run into tens of billions of dollars, and one forecaster has predicted the final bill could be as high as $100 billion. Trump is visiting Texas today and he said the cost of recovery from Harvey – the first natural disaster during his presidency – would be “very expensive” but pledged that “the federal government stands ready, willing and able to support that effort”.

Trump also made some impromptu remarks, saying “We love you, you are special, we are here to take care of you. It’s going well…What a crowd, what a turn out.”

So, the ripples from Harvey will hit the economy in several ways, including higher gas prices at the pump, higher commodity prices for building supplies – also look for construction labor to focus on the Houston area, meaning localized shortages, and higher insurance rates, and then consider the mortgage backed securities for residential and commercial, and the overall economic slowdown means the Federal Reserve will likely take a more dovish position on removing accommodation.

The markets started today’s trading in negative territory on news that North Korea had fired a missile that crossed over Japan. South Korea responds by having four F-15K jet fighters conduct bomb-dropping drills. Japan asks the United Nations Security Council to hold an emergency meeting. Kim Jong Un doesn’t seem to be backing down. This morning, Trump repeated the Washington cliché that “all options are on the table”, a warning that’s been issued time and again for more than a decade.

Kim, “smart cookie” that he is, has probably acquired enough evidence at this point to realize that the U.S. is unlikely to take military action to stop him as long as he has literal guns to the heads of 25 million people in Seoul. But if nothing explodes, Wall Street rolls merrily along.

Today the Dow Industrials opened down 134 points, then slowly and surely turned positive, marking a 200 point intraday swing from low to high. Many investors sought safe haven plays, pushing gold higher and pushing yields on ten-year Treasury notes to the lowest levels of the year. The bond market is certainly sending a clear signal that it expects the pace of Fed rate increases to slow dramatically.

Just two months ago, derivatives were showing that traders expected the target federal funds rate to rise to 2 percent over the next three years. Now, they see a rate of 1.6 percent, implying a little more than one boost from the current range of 1 percent to 1.25 percent.

It’s also notable that even though yields on benchmark 10-year Treasuries dropped to their lowest level of the year, touching 2.08 percent. About 75 percent of the respondents to JPMorgan’s widely followed weekly client survey say they are neutral on the bond market. That implies they anticipate no big changes in current conditions for the foreseeable future, which is a remarkable referendum on an economy that many expect to gather strength.

As the dollar declined to two-and-a-half-year lows, companies that do a lot of business outside the U.S. climbed. A weaker dollar boosts their sales and helps their profits when they are converted back into dollars. The dollar has weakened in part because a lot of economies in other regions are getting stronger, which boosts their currencies. The dollar is down almost 10 percent in 2017, at its lowest point in more than a year and the euro is at two-year highs.

Apple hit another record high today. The new iPhone launch is about 2 weeks away, maybe. While Apple has not confirmed a new iPhone will launch this year nor invited media to an event, it is expected to do something on September 12. Whatever happens, the tech rally isn’t dead yet.

Meanwhile, Apple and professional services company Accenture said they will team up to help businesses build better applications for iOS, the operating system that powers Apple’s iPhone and iPad.

The S&P/Case-Shiller 20-city index rose a seasonally adjusted 5.7% in the three-month period ending in June, compared with a year ago, the same rate of change as in May. The national index rose 5.8%, compared with a year ago, up from a 5.7% annual increase in May. Demand remains strong and inventories are tight. The Phoenix market for existing home sales is right in line with the national numbers. Phoenix prices were up 0.8% in the June period, and up 5.8% over the past 12 months.

The Conference Board’s consumer confidence index rose to 122.9 in August, up from a revised 120 in the prior month. The index hit a 16-year high of 124.9 in March. Consumers are feeling better given rising home prices, a healthy job market and stocks close to record highs. This bodes well for consumer spending in the third quarter. The present situation index, a measure of current conditions, jumped to a cycle high of 151.2 in August from 145.4.

The future expectations index rose marginally to 104 from 103. We feel good about things right now but we are not optimistic about the future. The gap between current conditions and future expectations is the widest since 2008. The growing divergence likely reflects the perception that the best days of the recovery are behind us, and that there is not much of a chance of further substantial improvement on the horizon. Still, both measures are elevated enough that consumers don’t appear concerned about an economic downturn.

Freeport–McMoRan announced that it was signing over 51% ownership interest in the Grasberg mine to the Indonesian government. Grasberg is one of the most valuable chunks of land in the world, the world’s largest gold mine and second-largest copper mine. The deal essentially rewrites an arrangement that began in 1972, when a Freeport predecessor began mining operations there under an agreement with a military dictatorship.

In exchange, the Indonesian government agreed to extend Freeport’s permit to export copper from the mine. That gives Freeport a measure of certainty as it makes plans to invest $20 billion to expand the mine and shift much of the work underground.

The Department of Justice is considering whether Uber violated laws involving the bribery of foreign officials. The DOJ is examining allegations that Uber may have violated the Foreign Corrupt Practices Act. The law makes it illegal for individuals and organizations to pay foreign government officials to obtain or retain business. It’s not clear exactly what incidents or countries the DOJ is looking at, or when the alleged violations may have occurred.

Airplane-equipment giant United Technologies is closing in on a more than $20 billion buyout of competitor Rockwell Collins.  Discussions are reportedly ongoing, but negotiations have focused on a deal price of less than $140 per share for Rockwell. The company was trading up about 2% to $130 per share late today morning, giving it a market cap of $21.7 billion.

Warren Buffett’s Berkshire Hathaway has become Bank of America’s largest shareholder by exercising its right to acquire 700 million shares at a steep discount, more than tripling an investment it made six years ago. Berkshire is now the largest shareholder in the second- and third-largest U.S. banks, with stakes of roughly 6.6 percent in Bank of America and 10 percent in Wells Fargo.

Berkshire exercised warrants to acquire its shares for roughly $7.14 each, well below their closing price of $23.58. To pay for the shares, Berkshire swapped $5 billion of Bank of America preferred stock it had bought in August 2011. Its new common shares are worth roughly $16.5 billion, giving Berkshire a roughly $11.5 billion profit.

Financial Review

Monday, Monday

Sinclair Noe — June 12, 2017

Podcast: Play in new window | Download (Duration: 13:15 — 7.6MB)

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DOW – 36 = 21,235
SPX – 2 = 2429
NAS – 32 = 6175
RUT – 2 = 1419
10 Y + .01 = 2.21%
OIL + .17 = 46.00
GOLD – .90 = 1266.50
BITCOIN + 0.39% = 2720.80
ETHEREUM + 16.83% = 398.58

The Dow Industrials fell from record highs, with an inside trading session that does not look like a reversal, not yet anyway. The Nasdaq Composite confirmed its sharp downturn on Friday. Really, it was just five mega-tech stocks that accounted for 75% of the Nasdaq’s drop.

Apple, Microsoft and Goggle parent Alphabet account for nearly 30 percent of the index’s weighting, and their outsize impact has driven the gauge lower even though the bulk of the stocks are doing fine. What has sparked the so-called tech wreck isn’t exactly clear, but Goldman Sachs issued a report last Friday entitled, “Is FANG Mispriced?”

More important is whether this is a short-term correction or the sign of something more ominous. One or two days down does not make a trend, but a trend can start with a couple of down days. At this point, most analysts see this as a pause after a very strong and fast rally in the mega-tech names.

The good news is that money is not leaving stocks, just rotating to different sectors. On a net basis, investors sent $1.9 billion to ETFs focused on U.S. equities Friday, five times the money sent to fixed income. While tech ETFs experienced withdrawals of about $510 million (and the Fang stocks lost $126 billion in market cap), financials had inflows of almost $1 billion and energy took in $120 million.

Tomorrow will kick off a busy week for economic data – we’ll get the latest producer price index, which is expected to be flat. Wednesday morning brings the consumer price index and retail sales data. Wednesday afternoon brings a statement from the Federal Reserve on monetary policy.

A federal funds rate increase is widely expected, so the more market-sensitive elements of the Fed’s meeting will relate to signals regarding future policy action — either the path for the rates going forward or plans regarding a reduction in the central bank’s $4.5 trillion balance sheet.

The British pound sterling continued falling today, marking its worst two-day decline since October. Last week’s election saw Prime minister Theresa May’s Tories falling short of a majority in Parliament. While the Tories are expected to cobble a slim coalition, May will now govern from a position of weakness.

Some of May’s most senior ministers are plotting to soften her approach to leaving the bloc, potentially keeping the country in the single-market and customs union. By contrast, hardline Brexit supporters are determined to force through the prime minister’s plans for a clean break.

Treasury Secretary Steven Mnuchin  had previously set an August deadline for the federal government to avoid a default. Mnuchin said he still prefers that Congress increase the government’s authority to borrow before lawmakers leave on a five-week break in August. However, he said he is “comfortable” that the Treasury Department can meet the government’s financial obligations through the start of September.

The 9th US Circuit Court of Appeals panel unanimously upheld an earlier decision by a federal judge in Hawaii to block the government from enforcing Trump’s executive order for a “travel ban” that would restrict refugees and people from six predominantly Muslim countries from entering the US. The Supreme Court asked two groups challenging the travel ban to file legal papers by Monday. Once it receives the briefs it sought, the court could act at any time.

Attorney General Jeff Sessions will testify publicly to a Senate panel tomorrow. It had been unclear whether Sessions would testify in an open or closed setting. Sessions is likely to face tough questioning from Senate Intelligence Committee members over his dealings with Russian officials during the campaign and whether he had a role in the firing of former FBI Director James Comey, who testified last week before the same panel.

Along with testifying before the Senate Intelligence Committee this week, Attorney General Jeff Sessions can expect a subpoena from lawyers for a former Maricopa county Sheriff Joe Arpaio. Arpaio is presently being prosecuted by the U.S. Justice Department for allegedly violating a federal judge’s order to cease immigration enforcement. Arpaio’s trial is scheduled to begin June 26.

Sessions could challenge the subpoena to testify. The defense attorneys hope to use Sessions to underscore the irony of Arpaio being prosecuted by the very entity that is using the threat of pulling federal funds to get cities to do essentially what their client is accused of doing.

The case will be before Judge Susan Bolton, the very one who upheld SB 1070, the Arizona state law that requires cops to act on a “reasonable suspicion” that someone they have detained is in the country illegally. As it now stands, the outcome will be decided solely by Bolton, not by a jury.

Puerto Rico voted overwhelmingly in favor of statehood on Sunday in a referendum that begins the steps toward sending representatives to Washington, DC. It was a landslide, with 97 percent voting for statehood, though turnout was only about 23 percent.

Puerto Rico previously voted in favor of becoming a state in 2012, but statehood opponents said the voter turnout was not high enough to accurately reflect will of the Puerto Rican people. Some fear that they will make the same case this time around.

The Supreme Court cut the time it will take for copycat versions of biologic drugs to get to market. In a unanimous ruling, the justices overturned a lower court’s decision that had prevented Swiss pharmaceutical company Novartis from selling its copycat version of Amgen’s Neupogen until six months after the US Food and Drug Administration approved it.

The decision has major implications for the pharmaceutical industry because it will dictate how long brand-name makers of biologic drugs can keep near-copies, called biosimilars, off the market. Even the six months at issue in the case can mean hundreds of millions of dollars in sales. Health insurers expect biosimilars to be cheaper than original brands, like generics, saving consumers billions of dollars each year.

In a separate case, the Supreme Court ruled in favor of Microsoft in its bid to fend off class action claims by Xbox 360 owners who said the videogame console gouges discs because of a design defect. In an 8-0 ruling, the court overturned a 2015 decision by the 9th US Circuit Court of Appeals that allowed console owners to appeal the dismissal of their class action lawsuit by a federal judge in Seattle in 2012.

Typically, parties cannot appeal a class certification ruling until the entire case has reached a conclusion. But the 9th Circuit allowed the console owners to voluntarily dismiss their lawsuit so they could immediately appeal the denial of a class certification. The court ruled such a move was not permitted because a voluntary dismissal of a lawsuit is not a final decision and thus cannot be appealed.

Jeffrey Immelt is stepping down as chairman and chief executive of General Electric. Amid mounting pressure from activist investor Trian Fund Management for operational changes, GE said Immelt will be replaced by John Flannery, a 30-year company veteran who oversaw a jump in profits at the health-care unit.

Of all companies that remain in the Dow Jones Industrial Average since Sept. 7, 2001, when Jeffrey Immelt took over as chief executive officer of GE. GE’s stock has been by far the worst performer, and one of only two that have declined. GE’s stock has plunged 29.6% since Immelt took control through Friday.

Meanwhile, GE won US antitrust approval to merge its oil and gas business with Baker Hughes to form a new publicly traded company. GE and Baker Hughes announced the deal in October, months after Halliburton’s effort to buy Baker Hughes collapsed under pressure from the Justice Department.

Under the agreement, GE will combine Baker Hughes with its oil and gas business, creating a company with $23 billion in annual revenue, the companies said. GE will pay existing Baker Hughes shareholders $7.4 billion for a special dividend.

Meanwhile, another CEO with a rocky tenure — Travis Kalanick of Uber — may be taking a leave of absence. Uber’s board of directors met Sunday to mull over how to reverse the ride-hail company’s slow-motion implosion. Board members voted to unanimously adopt all the recommendations from a recent investigation into Uber’s culture of pervasive sexism and harassment.

They also discussed the fate of two of the company’s top executives, CEO Travis Kalanick and senior vice president of business Emil Michael. Michael is out. We’ll learn Kalanick fate tomorrow, maybe.

Time for today’s edition of Retail Armageddon, featuring Gymboree. The children’s clothing retailer announced it was seeking Chapter 11 bankruptcy protection. Gymboree has been in discussions with lenders since the beginning of the year as it grapples with a heavy debt load, much of which stems from Bain Capital’s $1.8 billion leveraged buyout of the retailer in 2010.

In conjunction with the filing, the company said it secured commitments for up to $308 million in additional financing. Public filings show Gymboree has more than $1 billion in outstanding debt, of which about $872 million is due in less than a year.

The U.S. Air Force has temporarily canceled flying operations of Lockheed Martin’s F-35 jets at Luke Air Force base in Arizona. The move comes after a series of five incidents in which pilots experienced hypoxia-like symptoms – in other words, they weren’t getting enough oxygen. Since May 2, pilots of five F-35A Lightning II aircraft assigned to the air force base have reported physiological incidents while flying

Financial Review

More Records

Sinclair Noe — May 15, 2017

Podcast: Play in new window | Download (Duration: 13:15 — 7.6MB)

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DOW + 85 = 20,981
SPX + 11 = 2402 (record)
NAS + 28 = 6149 (record)
RUT + 11 = 1393
10 Y + .01 = 2.34%
OIL + .98 = 48.82
GOLD + 2.70 = 1231.40

The S&P 500 and the Nasdaq hit record highs today. Profits from S&P 500 companies surged by 14.9% during the first quarter, the fastest rate since 2011, per CFRA Research. That’s a far cry from the earnings decline of nearly 7% experienced at the start of 2015.

Roughly three-quarters of the 450 or so S&P 500 companies that have reported results this season have beaten profit expectations, the highest rate since 2010. The S&P 500’s price-to-earnings ratio of 17.5 remains well above the 10-year average of 14, but below the 13-year highs experienced earlier in the year. The energy, tech, financials and materials sectors –  enjoyed stellar growth of 20% or more during the first quarter.

On Friday, a major piece of malware hit the web, and throughout the weekend infected hundreds of thousands of computers around the globe. The software, called WannaCry 2.0, is what’s known as ransomware. A type of malware that burrows into your computer, ransomware encrypts the files on your machine, keeping you from being able to access them. The malware’s creator then asks that you to pay a fee to unlock your data.

The first round of the WannaCry 2.0 attack seems to have passed. But chances are the creator, or some other hacker, will re-purpose the malware and send it back into the wild again. Ransomware doesn’t just pop up on your computer by magic.

You must download it. And while you could swear up and down that you’d never be tricked into downloading malware, cybercriminals get plenty of people to do just that. Beyond that, make sure your system is up to date, back up your files, don’t stay connected to the cloud or unnecessarily connected to the internet. And finally, never pay the ransom.

Major oil-producing nations have struggled of late to bolster oil prices, as inventories piled up and crimped the potential for demand. Prices dipped below $44 a barrel this month, their lowest level in more than a year.

For years, Saudi Arabia and other nations in OPEC were often able to easily prop up prices. But their clout has ebbed as new players like American shale producers came into the market and the growth in demand for oil slowed. Saudi Arabia and Russia said an agreement to cut oil production should be extended by 9 months.

Production cuts agreed by OPEC and other major producers are set to expire at the end of June. But both Saudi Arabia and Russia said they would work to convince other countries to extend the cuts until the end of March 2018.

Oil hit its highest in more than three weeks. The oil majors, Exxon and Chevron moved higher. We aren’t really seeing a significant correlation between oil prices and the broader market, but the move in oil stocks helped give a boost to an otherwise quiet market.

The 13 members of the Organization of the Petroleum Exporting Countries are due to meet on May 25 to discuss the extension. That does not mean it is a done deal. There is disagreement among the ranks. Iran and Iraq do not want to reduce their production. The Saudis will not make cuts on their own. In the short term, large amounts of crude remain unsold and in storage.

Saudi Arabia and Iran have been selling some of those stores, blunting the impact of the cuts. In the longer term, the Saudis may be making the situation easier for US shale producers by agreeing to rein in output for such a long time.

Saudi Arabia is planning to cement ties with President Trump by investing $40 billion in US infrastructure development. The kingdom’s sovereign wealth fund is set to announce the plans which may be unveiled next week to coincide with Trump’s visit to the kingdom. Trump will be making his first foreign trip since taking office on 19 May, visiting Saudi Arabia and Jerusalem then heading to Europe.

The program would potentially be worth $200 billion in direct and indirect investment in the next four years.  Trump has said he intends to push for $1 trillion in US infrastructure investments over the next decade, with $200 billion coming from taxpayers and the rest from the private sector.

The National Association of Home Builders and Wells Fargo said on Monday their index of builder confidence in newly built, single-family homes climbed to 70 points from 68 in April. NAHB said the report shows that builders’ optimism in the housing market is solidifying, even as they deal with higher building material costs and shortages of lots and labor.

Builder confidence is a reasonably good predictor of housing starts, the process of breaking ground on a home. Housing starts have run at about a 1.2 million pace for the past several months. Total starts and single-family only are about 64% of their long-run averages.

Also, the New York Federal Reserve said its barometer on business activity in New York state unexpectedly fell in May, putting it into negative territory for the first time since October.

Thermo Fisher Scientific has agreed to acquire Patheon for $35 a share, or $7.2 billion including $2 billion of net debt. Thermo Fisher is involved in research and laboratory services; they make electron microscopes and DNA sequencing machines. Patheon offers development and manufacturing services to biopharmaceutical companies; they make the drugs and chemicals. Patheon shares jumped 34% on the news.

Moody’s will buy Dutch business intelligence company Bureau van Dijk for $3.2 billion. Moody’s said the deal, which is expected to close late in the third quarter, will be funded through cash held offshore and new debt financing.

Amazon.com went public exactly 20 years ago as an unprofitable online bookstore that was just three years old. If you had invested $1,000 in Amazon, and held it, you would now hold about $638,000 worth of stock. Admittedly, it did not look like a good investment 20 years ago, and price has been on a roller-coaster.

And if you are wondering which sector Amazon will crush next, consider furniture and appliances. Amazon plans to build at least four massive warehouses focused on handling the bulky items that trucking companies sometimes call ugly freight and parcel carriers see gumming up their operations. Furniture is one of the fastest-growing segments of online retail, growing 18% in 2015, second only to groceries, and some 15% of the $70 billion US furniture market has moved online.

Players are struggling to get the market right, however. Delivering couches and dining sets is more complicated and expensive than handling conventional parcels, and that may provide a fresh challenge to Amazon’s budding self-controlled logistics network.

Sears Holdings’ CEO Eddie Lampert vowed to fight back against suppliers trying to take advantage of his company, saying that “dire predictions” about the retailer’s future have hurt its position with vendors. Lampert says Sears has been working with suppliers to ensure that their level of credit risk is “both affordable and appropriate,” but some vendors have tried to capitalize on its situation.

Driverless car maker Waymo—owned by Google’s parent company Alphabet—has shown “compelling evidence” that its “former star engineer” stole more than 14,000 confidential files. A federal judge said in a ruling made public today, that engineer, Anthony Levandowski, joined Uber last summer to lead its self-driving car efforts and he is now barred from working on “lidar” technology for Uber.

It also instructs Uber to return the “pilfered” files by May 31 at noon. Waymo sued Uber in February, alleging theft of trade secrets and its in-house lidar, the technology that allows a self-driving vehicle to “see.” It later upped the ante and said Uber colluded with Levandowski to steal proprietary information.

Meanwhile, in a separate announcement, Waymo, the self-driving car unit that operates under Google’s parent company, has signed a deal with the ride-hailing start-up Lyft. Lyft is the arch-rival of Uber, and Alphabet-Google is ticked off at Uber right now, so a Waymo-Lyft deal is a union formed out of shared loathing for Uber.

The deal calls for the companies to work together to bring autonomous vehicle technology into the mainstream through pilot projects and product development efforts. The deal was confirmed by Lyft and Waymo.

The City of Philadelphia has sued Wells Fargo, accusing the largest US mortgage lender of intentionally steering minority borrowers into higher-cost home loans than it offered white borrowers.

In a complaint filed in Philadelphia federal court, Philadelphia faulted Wells Fargo’s “long history” of “redlining” in Philadelphia, and said the bank’s practices reflected a “total breakdown of appropriate internal controls” like its recent creation over unauthorized customer accounts. The city alleges that Wells Fargo pushed minorities into riskier loans with higher rates, even in cases where the borrowers had credit profiles that would have qualified them for lower-rate loans.

The complaint charges that the problem has been ongoing since 2004 and is a violation of the Fair Housing Act, and comes in the wake of an important Supreme Court decision on the legislation. On May 1, the high court ruled that Miami could sue Bank of America for predatory lending practices that increased segregation.

Philadelphia City Council recently voted to change handlers of its $2 billion payroll account, switching from Wells Fargo to Citizens Bank.

Financial Review

No Small Feat

Sinclair Noe — March 27, 2017

Podcast: Play in new window | Download (Duration: 13:16 — 7.6MB)

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DOW – 45 = 20,550
SPX – 2 = 2341
NAS + 11 = 5840
RUT + 2 = 1357
10 Y – .03 = 2.37%
OIL – .12 = 47.85
GOLD + 10.90 = 1254.80

Stocks pared losses, and recovered from session lows; enough to push the Nasdaq into positive territory; enough to turn a 184-point loss on the Dow into just a 45-point loss at the close.

The Dow Jones industrial average is now down for 8 straight sessions – the longest losing streak since August 2011; you may recall that the instigation for that loss was concern about the credit worthiness of some of the largest economies in Europe.

Additionally, the only other times since 1990 that we have seen 8 down days for the Dow were in October 2008 and September 2001. Prior to 1990, it happened three times in the 1980s and much more frequently in the 1960s and 1970s. Still, the current losing streak only saw the Dow drop 400 points or 1.9%.

The overall trend is still up and the recent weakness doesn’t look like anything more than the markets taking a pause after a sharp and fast run-up, but it bears watching.

After a week that began with the FBI disclosing that it’s investigating President Donald Trump’s campaign team for possibly colluding with Russia to tilt the 2016 election, and ended with a failure to rustle up enough votes to repeal the Affordable Care Act, the president is moving on. The administration plans to take a lead role in crafting major legislation to cut taxes with an eye toward meeting an August target date.

Getting a broad tax bill passed by Congress and on Trump’s desk for signature into law looks to be no easy feat, especially after intra-party differences last week torpedoed the healthcare legislation he had backed. And before tax reform, there is the issue of passing a budget, and dealing with the pending national debt ceiling. Analysts at Bank of America Merrill Lynch said in a research note that a tax bill, “if passed at all, could be a very watered-down version of current proposals.”

It’s tough all over. US states are reducing their tax revenue forecasts due to concerns over a projected slump in economic growth, low oil prices, possible federal tax cuts and other factors. The Rockefeller Institute of Government, the public policy research arm of the State University of New York, said while the revised forecasts varied, states generally anticipate continued sluggish growth for their two biggest revenue sources: income and sales taxes. That will squeeze already-tight state budgets.

For fiscal 2017, which in most states began on July 1, the median income tax growth rate slipped to 3.6 percent from 4 percent, while the rate for sales taxes fell to 3.1 percent from 4.2 percent. In fiscal 2018, states forecasted slight increases over fiscal 2017 with the median growth rate for income taxes at 4.1 percent and sales taxes at 3.5 percent.

Jared Kushner, Trump’s 36-year-old son-in-law, will oversee a new “SWAT team”. Its goal is to reinvent the federal government. The entire federal government. Trump has already tasked Kushner with bringing peace to the Middle East, plus several other significant domestic and foreign policy assignments.

Kushner’s new Office of American Innovation will reportedly showcase several corporate titans, including Apple’s Tim Cook and Microsoft’s Bill Gates, to “modernize the technology and data infrastructure of every federal department and agency.” So, good luck with all that.

And in his spare time, Kushner has been called to testify before a Senate committee investigating whether Russia tried to interfere in the election. Earlier today, a Russian bank under US economic sanctions over Russia’s incursion into Ukraine disclosed that its executives had met Jared Kushner during the 2016 election campaign.

The Trump administration is attempting to crack down on sanctuary cities, announcing that local governments will have to certify they aren’t impeding communication between their police and federal immigration authorities in order to continue receiving Justice Department grants. Attorney General Jeff Sessions said that in one week, about 200 states and localities refused to honor federal requests to turn over undocumented immigrants. He didn’t specify the time period.

Sessions reiterated a policy announced in an executive order Trump signed in his first week in office. That document authorized the Attorney General and Secretary of Homeland Security to withhold federal grants from sanctuary cities that don’t help the US government deport immigrants. Sessions said the federal government could also “claw back” grants to jurisdictions refusing to work with the federal government, in addition to refusing to approve new grants.

Chicago Federal Reserve President Charles Evans says inflation looks “well on its way” to reaching US economic objectives. Yet many uncertainties remain, particularly with the latest failure of the GOP’s proposal to repeal and replace Obamacare. At a speech in Madrid, Spain, Evans said he still worries long-term inflation expectations are running below the Fed’s 2 percent inflation objective.

Evans said he doesn’t have confidence there will be four rate increases in 2017, and three increases are “plausible,” but two rate hikes are “also possible.” This week, eleven speeches are scheduled to take place from nine of the Federal Reserve’s Open Market Committee’s twelve members. Fed Chair Janet Yellen will hold her keynote speech to a conference in D.C. on Thursday morning.

It’s a busy week for competition authorities in Brussels. The $140 billion merger between Dow Chemical and Dupont is expected to win Euro Union approval, while a veto is anticipated for the €29 billion-euro tie-up of LSE and Deutsche Boerse. Antitrust officials are also expected to bless a second agrichemical megamerger – ChemChina’s purchase of Syngenta – next week.

A joint committee of ministers from OPEC and non-OPEC oil producers meeting over the weekend has agreed to review whether a global pact to limit supplies should be extended by six months. Nothing concrete just yet; but they will look revisit production cuts in April.

OPEC and 11 other leading producers including Russia agreed in December to cut their combined output by almost 1.8 million barrels per day in the first half of the year. The original deal was to last six months, with the possibility of a six-month extension. The meeting of energy ministers found generally good compliance with the production cuts so far, although there is little to indicate that it has eased the global oil glut.

Last week, Credit Suisse downgraded the retail sector, saying the outlook had become bleaker than it had anticipated in large part because of events in Washington and through discussion of “whether we think the risks of the border adjustment provision in the House corporate tax reform proposal are fully reflected in apparel and retailing stocks”. Other analysts have shown similar pessimism.

In the past several months, Macy’s has announced it will close 63 stores; Sears, 150; The Limited, 250; Guess, 60; American Apparel, 104; Abercrombie & Fitch, 60; JCPenney, up to 140. The cost in jobs is stark, with Macy’s saying it expects to see 10,000 workers laid off, including 6,200 managers, or 17% of executives.

A recent Synchrony Financial report entitled The Future of Retail predicted that instant gratification coupled with a higher degree of tech-driven personalization would drive consumer behavior and retail industry through to 2030. The report said that the future of bricks-and-mortar will center on authentic brand experiences: more than half of consumers polled said they looked forward to an amalgam of in-store and entertainment experiences.

If you were looking for top performing stocks of the past decade, you would expect to hear about the FANG stocks, Facebook, Apple, Amazon, Netflix, and Google. Don’t forget Domino’s; the pizza company is up some 2,200% in the past decade. Not as good as Netflix, but better than the others.

Bill Gross, who was fired from Pimco four decades after he co-founded the investment firm, has settled his lawsuit against the company for just over $81 million. Gross sued Pimco in 2015, claiming his dismissal from the company was a breach of contract, and a breach of covenant of good faith and fair dealing. Gross said at the time that he suffered damages in excess of $200 million.

A lawyer representing the Pimco co-founder filed a request in California state court to dismiss the fund manager’s suit over his 2014 departure from the company. All proceeds from the settlement will go to charity — to the Sue and Bill Gross foundation.

UPS’s legal fight with New York has gone up in smoke. A federal judge said United Parcel Service ignored “red flags” that its brown trucks were being used to transport millions of untaxed cigarettes from Indian reservations. A similar suit is also pending against UPS rival FedEx.

The US district judge ruled that UPS failed to comply with a 2005 deal it struck with the state to fix the problem without going to court. She said she’d decide on damages later. The state seeks more than $800 million in damages for lost tax revenue.

Following a high-impact crash in Tempe, Arizona, Friday night, Uber suspended its self-driving car program. The accident occurred when the driver of a second vehicle “failed to yield” to the Uber car while making a turn. After checking things out, Uber said it is putting self-driving cars back on the road for passengers to hail in Tempe

NFL owners approved the Oakland Raiders’ move to Las Vegas at the league meetings. Raiders were not satisfied with Oakland’s proposals for a new stadium, and Las Vegas stepped up with $750 million in public money. Bank of America also is giving Raiders owner Mark Davis a $650 million loan. The Raiders likely will play two or three more years in the Bay Area before their $1.7 billion stadium near the Las Vegas strip is ready.

Financial Review

Happy Day

Sinclair Noe — March 20, 2017

Podcast: Play in new window | Download (Duration: 13:15 — 7.6MB)

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DOW – 8 = 20,905
SPX – 4 = 2373
NAS + 0.53 = 5901
RUT – 7 = 1384
10 Y – .03 = 2.47%
OIL – .55 = 48,23
GOLD + 5.10 = 1234.90

The directors of the FBI and NSA appeared before a rare open congressional intelligence committee hearing today.

FBI Director James Comey confirmed the FBI is investigating Russia’s interference in the US election and investigating possible links between the Trump campaign and the Russian government. Comey said the FBI has “no information” to support President Trump’s allegation that Barack Obama wiretapped him.

NSA chief, Admiral Mike Rogers, weighed in as well, saying that he had no knowledge of anyone asking the British or any other ally to wiretap Trump. That seemed to refute another claim made by the White House.

Confirmation hearings for Trump’s Supreme Court nominee kicked off today. Trump nominated Neil Gorsuch, 49, to replace conservative Justice Antonin Scalia, who died in February 2016.

Meanwhile, Wall Street also braced for a contentious House vote on the GOP health care bill slated for Thursday. The bill’s passage is considered a first step toward enacting tax reform, but it has faced criticism from both sides of the aisle.

The Trump administration appealed Friday a temporary restraining order against its revised travel ban policy. The reworked executive order (which halts the issuance of visas to six majority-Muslim countries for 90 days and suspends the refugee resettlement program for 120 days) was set to go into effect on March 16, but federal judges and Hawaii and Maryland blocked it from going forward.

The Justice Department filed an appeal in the Maryland case, which will take that fight to the Fourth Circuit, based in Richmond, Va. Meanwhile, a federal judge in Hawaii declined a request from the Justice Department to narrow the injunction. That ruling clears the way for the Trump administration to appeal the judge’s initial decision to the 9th Circuit Court of Appeals.

Bill Gates met with Donald Trump today.  An agenda wasn’t released, but a statement from the Gates Foundation said it has “a long history of working with officials” on issues like domestic education and global health and development. Gates and Trump also met in December to discuss innovation.

On March 16, the Gates Foundation said that it was “deeply troubled” by the president’s 2018 budget request, released that morning. The proposal included deep cuts to both the EPA and non-military overseas aid. The next day, Gates responded with an article on the Gates Notes blog, “How Foreign Aid Helps Americans.”

The meeting of the Group of 20 in Germany over the weekend featured an apparent win for the US after the communique produced by the talks omitted warnings about protectionism. One thing that was repeated was the pledge to overhaul bank-capital rules, with the statement urging the Basel Committee on Banking Supervision to finalize the Basel III reforms.

Away from the G-20, German Chancellor Angela Merkel joined Japanese Prime Minister Shinzo Abe in calling for a concerted effort to defend free trade.

Nine months after Britain voted to leave the European Union, Prime Minister Theresa May is planning to open divorce proceedings on March 29.  May will trigger Article 50 of the Lisbon Treaty, the EU’s guiding document, which details how a country leaves the bloc. It’s never been activated and is only about 260 words long. It gives the departing country up to two years to negotiate “its future relationship with the Union.” If May has her way, the actual split will occur around April 2019.

Greece missed another deadline for unlocking bailout funds today, edging closer to a repeat of the 2015 drama that pushed Europe’s most indebted nation to the edge of economic collapse. Prime Minister Alexis Tsipras had promised the latest bailout’s long delayed review would be completed by March 20, but many see that reaching an agreement even in April is now considered a long shot.

Deutsche Bank will issue 687 million new shares at a 35 percent discount to Friday’s closing price — to raise €8-billion-euros of fresh capital. In its annual report published today the bank said it expected revenue to remain broadly unchanged this year, while revealing that the bonus pool was slashed to €500-million-euros in 2016.

Britain’s Vodafone Group and Idea Cellular agreed to merge their Indian operations in a $23 billion deal. The combined entity would have almost 400 million customers, accounting for 35% of the market share.

Albertsons, the grocery-chain operator backed by Cerberus Capital Management, has held preliminary talks to merge with Sprouts Farmers Market. Bloomberg reports the discussions, which took place in recent weeks, are at an early stage and may not lead to a deal. The talks have involved a plan to take organic grocer Sprouts private and add it to Albertsons’ portfolio, which includes the Safeway store brand.

Unilever is preparing a $7.4 billion sale of some of its food brands, British newspapers reported on Saturday. The British-Dutch company is planning to sell Flora margarine and Stork butter brands. Unilever rebuffed a surprise $143 billion takeover offer from Kraft Heinz last month, saying the bid undervalued the company.

Pressure is growing on Twitter CEO Jack Dorsey to step down, per the Sunday Times, after a report from the University of Southern California and the University of Indiana alleged that up to 48 million of its accounts – equal to 15% of its users – were robots not people (that’s nearly twice the company’s own estimate).

The number of executive departures from Uber is growing. President Jeff Jones is quitting the company, citing “incompatibility with leadership,” while Brian McClendon, a VP responsible for the company’s mapping program, is leaving to return to his home town in Kansas. Uber has been recently plagued by allegations of sexual harassment and the combative behavior of CEO Travis Kalanick.

Bullish bets on West Texas Intermediate crude prices fell by a record amount in the week ending March 14, with wagers on further price falls doubling. Energy lender Arab Petroleum Investment Corp. sees oil prices remaining below $60 a barrel for the rest of the year.

Bank of America Merrill Lynch has published a giant list of asset class returns for the year so far. Here’s a quick rundown. Looking at global asset classes, the Pacific Rim, excluding Japan is up 9.6%, matched by Emerging Market equities, Industrial metals up 7.6%, US equites (7.2%), global equities (up 6.7%) And Euro stocks (up 4.9%).

By country; Russia’s stock market is the laggard this year after being one of the best performers in the world in 2016. India is the leader, year-to-date, up 14.5%, followed by South Korea (up 13.3%) and Brazil (up 12.8%). China and Hong Kong round out the Top Five. Russia is down 9%.

By sector, Biotech is the leader (up 11.9%), followed by information technology (up 11.6%), healthcare (up 9.3%), banks (up 7%), with consumer discretionary and financials both up 6%.

The strongest currencies against the US dollar are the Mexican peso, which took a hit following the US election in November, but has gained 7.8% against the dollar since the start of the year; followed by the South African rand, and the Australian dollar.

Natural gas prices have tumbled amid unseasonably warm weather, which implies weaker demand for heating. The US had its second-warmest February ever on record, per to the National Centers for Environmental Information.

Crude oil is also a big loser, likely to the dismay of the Organization of Petroleum Exporting Countries. The top gainers among commodities include iron ore (up 15.3%), lead (up 12%), aluminum (up 11.1%) and cotton (up 10.5%). Nat gas is down 20% and WTI crude is down 9%.

Or, if you want to keep it simple, Apple hit a record high today, and it is up about 23% from the start of the year. Of course, you still must decide if you want to run with the bulls or buy the dips.

Italy is ranked the healthiest country on Earth in the Bloomberg Global Health Index of 163 countries. A baby born in Italy can expect to live to be an octogenarian.

Even though economic growth in Italy has stagnated for decades, and almost 40 percent of its youngsters are out of jobs and it’s saddled with one of the world’s highest debt loads relative to the size of its economy; Italians are in way better shape than Americans, Canadians and Brits, who all suffer from higher blood pressure and cholesterol and poorer mental health.

Italy also has “an excess of doctors.” Then there is the diet, rich in vegetables and drizzled with extra virgin olive oil. Each country in the index was graded based on variables such as life expectancy, causes of death and health risks ranging from high blood pressure and tobacco use to malnutrition and the availability of clean water.

Iceland, Switzerland, Singapore and Australia rounded out the top five most-healthy countries in the index. The U.S. placed No. 34 with a health grade of 73.05 out of 100. It’s ranking for prevalence of overweight people is 67.3 — tipping the scale as one of the world’s heaviest nations.

Norway is now the world’s happiest country, per the 2017 World Happiness Report. The Central African Republic was the least happy of 155 countries. The report was prepared by the Sustainable Development Solutions Network, an international panel of social scientists convened by the United Nations.

Researchers used a scale of zero to 10, covering six areas: gross domestic product per capita, life expectancy, support from relatives or friends, charitable giving, freedom to make life choices, and perceived levels of government and corporate corruption. Norway and several other Nordic countries dominated the top of the list.

America’s rank on the happiness scale is falling.

Even as the country pulled off an economic turnaround, with increases in income and unemployment falling to historic lows, Americans are becoming less happy. When it comes to happiness, the US ranked 19th among the 34 countries in the Organization for Economic Cooperation & Development in 2016, down from third among 24 countries on a similar measure in 2007.

And today is the first day of Spring. Enjoy.