Kolek planning to go pro
So you are saying you sold 90% of your equities? And took the cap gain hit?
Costcoxhad its earnings call after close yesterday. CEOs usually like to keep things positive at these things, even when times aren't swell, and Costco's did, too. But I thought Richard Galanti was pretty straightforward in discussing the challenges right now.Here's Galanti when asked if he was seeing any "light at the end of the tunnel" on inflation:Well, again, anecdotally, when we talked to the buyers, they’re starting to see a few examples, whether it’s something like outdoor, patio, furniture or barbecue grill where steel prices are coming down, and we’re reminded by Craig and Ron or the buyers reminded at the budget meeting when prices were going up, make sure you understand why they’re going up. Is it -- what piece of it is raw material costs? What piece of it is freight costs? And when these things come down, you better be on the phone with them calling them saying, when are going to get a reduction?And so I think in part because of our limited selection -- our limited number of SKUs and a huge volume, I think our buyers know pretty darn well a lot of the cost components of these things. And that, I think, bodes well for us. But again, at the end of the day, we are seeing -- I think it is a little light at the end of the tunnel. Certainly, container rates have come down. Container shortages have improved. The port delays have improved, all that things go into it. And as raw material prices come down -- and FX generally helps you and hurts you. When we report a foreign company’s earnings in U.S. dollars, and the currency has gone down 10%, it’s 10% less earnings that we report. But at the same token, since we’re using U.S. dollars in a lot of things, not just in the U.S. to buy different supplies and raw materials from other places, that helps you a little bit.And again, I think it’s -- could something happen tomorrow to change this? Sure. But at least we’re seeing the things going -- starting to go in the right direction. Hopefully, that bodes better for not just us, but everyone.So he's not jumping up and down and saying everything's terrific, but he's not standing on a ledge, either. I've heard this from a few other CEOs, too -- things are still not great, and they expect some difficulties ahead, but many of them are seeing positive signs.Again, I am not celebrating. But long-term, I'm hopeful. And I also know history. Things were beyond just a little rough during the Great Recession for several years, but Costco -- and the entire economy -- DID emerge from that and had a heck of a decade afterward.
82One thing I forgot to mention in my post on the current issues is the velocity of money. IMO it was one of the best ways to measure the economy and I believe the velocity has slowed in a big time way, and more importantly, in a very quick time frame. I can only speak on my own experiences, but I see our firms cashflow every day and incoming has stalled. To date, we have received under 70% of our expected incoming cash in the month of September. We will be higher by the end of the month, but nowhere near 100%. As for your post on the long term, I do not disagree that things will be brighter down the road. We may differ on when down the road happens. I believe there is going to be significant damage inflicted to many people around the world and that is what causes me concern on how long things will take. I have no idea of the % of people ill prepared for a serious downturn, but my gut says it is far more than we think it is. We avoided two possible depressions IMO, the housing bubble mess and the start of the pandemic and it was 100% avoided because our government did everything in their power to avoid it.IMO, it was avoided because they could throw everything to avoid it and they did so because they know how vulnerable overall society is to such an event. I do not think sending stimulus checks saved the day, but % interest rates and QE did. I truly believe they needed to save the day, but how many times can they do it? Again, I hope my beliefs are completely off target and my quotes are used against me in a year or two, or sooner. That being said, I do not think underestimating what a real economic mess would look like is wise.
Full employment pushing up wages. Continued supply chain issues in China as well as a record breaking heat wave.Corporate profits way up.Chip shortage. Grocery prices upFuel prices down.If the railroads strike, expect a huge spike.
HermanOur clients range in size from well funded start ups to publicly trading companies and I am seeing disturbing trends. These clients are across many segments of our economy and we are not industry or product specific and money flow is slowing quickly. For my business I believe we are in a very strong position, provided our clients pay their bills. Our A/R is at record high and past due is at record high. Our biggest clients simply are paying extremely slowly and getting slower. Much of time is spent on chasing money from companies I believe may be struggling.Would love your opinion, but I think banks are facing major write offs in the coming quarters. Thoughts?Currently at our firm, we are watching expenditures more than ever. I can take some pain personally to navigate a storm at work and doing just that. I believe the short term pain is worth the long term opportunity.
MU82 - That's exactly what I posted here the first week of September. Raw material prices have dropped significantly in the last 6 months. Gas has dropped for 2+ months now. Containers and transportation are way noticeably improved since the first of the year. There are no delays and prices have dropped a hair. I added that many companies still have high inventory of raw material that they bought at the higher price (because they had to, because of longer lead times which is also dropping) and this older inventory is getting used up and you can expect price decline as the next raw material purchase batch enters company inventory.
People getting what they voted for, and they deserve it good and hard.
Hope day cum too der census next tyme around, aina?
All age cohorts are participating in the labor market at pre-pandemic levels except for the boomers, who took the COVID market ride and retired early. That's why the labor market is so constrained. The only way to get that cohort back into the workforce is to crush their 401k's. Hence, the market is down and the Fed will continue to tighten until the market pushes the boomers back in the pool. It is what it is but personally I'm holding off putting cash to work until that happens.
Fat chance. Every empire has fallen. We probably need a reset anyways.
Stimmy checks 100% saved the day.
Most definitely. The third one was likely not needed, and the expanded child tax credit was a bit of an overkill, but the checks most definitely worked.
Yule bee singin' a different toone wen bus service takes a dump, hey?
Maybe, But did my 20 yo college student need to get $1400 checks .... NopeThe targeting mechanism needs some refinement.