$AAPL price per share in 2003 - $0.25
$AAPL dividend per share today - $0.82

Crazy to think that your Apple DIVIDEND this year could buy 3+ shares less than 20 years ago.

Thursday Macros

Powell Biden Push Equities to New Highs...But Bonds Slump...Trend Start?

Powell tried to talk the bond market down yesterday and got the 10 year back from 1.65 to 1.61 at the close... He gave his old "not thinking about not thinking about" raising rates or tapering... While we agree that no rate rises this year, the Fed will start to think about tapering between the June meeting and Jackson Hole... It is coming, and no matter how many times Powell uses the word transitory, there is nothing transitory about the soaring inflation that is already here and worsening supply chain disruptions. In the latest "American Shipper" everything on the Trans Pacific is sold out for the month of May... And Powell did even say that the supply chain issues may take more than a year to resolve itself... That is not transitory...

Rates... We believe the trend for higher rates is starting... Japan was closed overnight, but will be open tonight... As Europe opened the 10 year gave back all the gains from the Powell presser going to 1.65 low of yesterday. Next mild support is 1.68, the auction stop on the last 10 year, then 1.75 and off to the races... Month end duration extensions will slow it down, as will re-allocations from stocks to bonds, but we think the vigilantes will use these buyers as a source to reenter shorts... The shorts pretty much covered in the last three weeks as 10 years went from 1.75 to 1.52...5 years should break .90 on the way to 1% then potentially get to 1.25... But we do not want to get ahead of ourselves

Equities may be steamy from a value perspective, but will continue to "melt up" in the face of another 4 trillion stimulus bill... We know that Biden will be forced to cut it back and reduce the tax impact... Everyone affected will start to change their trading patterns to trade stocks in tax advantaged accounts... No way the tax increases, whatever the levels, will generate the amount of revenue expected... But the soaring economy will... Nonetheless , lots more treasuries to be issued to fund these programs....

The Fed is now outcome based...meaning they can quickly fall behind the curve... Powell still claims that the Fed has the tools to curtail inflation higher than 2.5%...he won't or will be too slow to act... He wants employment to soar... He wants maximum optionality...we are ok with that, but the risk is that the Fed gets behind and markets go into a "taper tantrum"... Technically the bearish skew of risks could not be clearer for treasuries... So be careful of managing your duration risk... As for credit spreads, they will continue to be tight as long as the equity "melt up" continues... But even that will reverse at some point in the not too distant future... Lots of numbers today...

KIA said:

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Let's talk earnings for idiots...

I choose to make trades on every stock that beats earnings yet tanks the next day. What am I missing and what other things should I be looking for?

Example... TSLA, APPL, GOOGL (amongst others) all had earnings this week. I choose to take a flyer on TSLA. They beat earnings, and stock price goes down and I lose money. AAPL and GOOGL do the opposite, and of course I didn't play it and many of you have fruit in your face (congrats!). This isn't the first time I go red on earnings, so just wondering what I am doing wrong.

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What you've been seeing is the market in it's most primal state.

Retail: "Holy crap, great results, this is gonna be great for the stock. WTF, IT'S TANKING!?!?"

Institutions: "There's the results we were anticipating, time to sell into this strength as we've been in this for awhile now and there isn't much juice left in that fruit for a bit"

When the market is weary as it's been recently (despite ATH's everywhere) selling into strength is the theme. That's why you see great results get met with selloffs. It's the nature of the animal. When the value is there again after the sales are complete they'll get back in.

With the possibility of needing a new roof after last night I may need to take some off the table in near future to replenish the emergency fund

ehrmantraut said:

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$AAPL price per share in 2003 - $0.25
$AAPL dividend per share today - $0.82

Crazy to think that your Apple DIVIDEND this year could buy 3+ shares less than 20 years ago.

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Oh how I wish I would have backed up the truck at $0.25 share. What a story that would be.

Sounds like the definition of inflation

CATERPILLAR EXEC SAYS COSTS MAY INCREASE BECAUSE OF SUPPLY CHAIN ISSUES - CONF CALL

— *Walter Bloomberg (@DeItaone) April 29, 2021

zwhag2010 said:

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With the possibility of needing a new roof after last night I may need to take some off the table in near future to replenish the emergency fund

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Ugh, sorry to hear that.

My F150 is about to lose the water pump so I get to do that project tonight. But self service saves me about $400..........YOLO TIME.

McInnis 03 said:

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CLOV $11.20+
PLTR $24+
QQQ $342+

DIAMONDS FOR EVERYONE.

Oh, and just for fun, GVSI $.03+ lolz

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CLOV going to have another rocket day. Love it!

Cost-Push inflation.

Reality is our Federal Govt has engineered a vicious cycle of Stagflation now with MMT or "the rule of infinity"... it was certainly done by design as no sane adult that cares about a free and prosperous society would willingly implement what we've implemented.

I see people cheering a potential 6% increase of GDP. The details matter. First, it's not hard coming off a lockdown. Second, Xiden has spent 10% of our GDP in his first 100 days. I know some of you weren't math majors, but that's not good. When you couple this nuking of our future purchasing power with a policy that fosters higher unemployment (no will to work), you get Stagflation.

Mostly Foggy Recollection said:

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Cost-Push inflation.

Reality is our Federal Govt has engineered a vicious cycle of Stagflation now with MMT or "the rule of infinity"... it was certainly done by design as no sane adult that cares about a free and prosperous society would willingly implement what we've implemented.

I see people cheering a potential 6% increase of GDP. The details matter. First, it's not hard coming off a lockdown. Second, Xiden has spent 10% of our GDP in his first 100 days. I know some of you weren't math majors, but that's not good. When you couple this nuking of our future purchasing power with a policy that fosters higher unemployment (no will to work), you get Stagflation.

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My wife and I originally wanted to start building a house back in January, but the bids came back a little higher than we wanted to borrow money for. We decided to really buckle down on our spending and wait a year. My math said we would be able to build the house we wanted in a year's time without having to borrow more money than we budgeted for.

Fast forward 4 months, and the freaking costs are going up significantly faster than we are saving. We were bid $150/sq. ft. in January. The same plans would run $190/sq. ft. now.