Friday, June 13, 2014

Good Morning America, How Are You?

Yahoo, great shouts of celebration, I finished problem solving on my underground sprinkler system.  As I really guessed all along, it was the wiring between my controller and the valves.  I had to dig 100+ feet of trench, and bury new wire.  (Tearing up the old wiring was not an option.)  

Today, I am very sore and stiff, but every sprinkler is now working on the controller. 

The early peonies are now through, after we had very hard rains yesterday and last night.  The rains beat down the flowers, and the petals come off.  The good news is that the later peonies have not bloomed yet.  I look forward to that.

Have a great day.  Enjoy your food, wine and your family. 

Small Business Outlook

Summary: 

It is Friday the 13th, and we can expect that superstition will abound out in the set of all superstitious, whoever they are.  (When I was playing pro-baseball, the players were all very superstitious, but not about Friday the 13th that I know of.)  So?  I have no idea, but beware anyway.

1.   Equities were down all day yesterday on bad economic news, and news coming out of Iraq.  Core Retail sales match consumption of GDP, and it slipped .01% in May. (Blame it on the good weather?)  On the other hand, (as Truman would complain), April was revised upward substantially.  So, Bloomberg and others were discounting the retail sales for May.  However, the adjustment upward for April?  Is that not a ridiculous increase?  How can grownups being paid for this stuff print that revision with a clear conscience?

2.   Volume on NYSE was so low as to be ridiculous.  It was only 610 million shares on NYSE. 

3.   Oil has increased in price over the last few weeks, and yesterday was a very large move to the upside.  Since the beginning of May, Light Crude has moved from approximately 98.74 to 106.95 (yesterday's high in futures).  That is a significant move in such a short time, unless there were supply problems somewhere. 

4.   The good news (if there was any) energy (+.3%) and utilities (.3%) finished modestly higher.  Energy has YTD gains of 8.6% and utilities 10.3%. 

5.   Treasures had a strong day as money was searching for so-called safety. 

6.   In economic news before the opening, PPI-FD was released.  Bloomberg is reporting it was not so bad.  Then another analysts comes along, and the sky is falling.  Basically May missed expectations where expectations was .1% growth, prices fell to -.2% Month-over-Month.  Year-over-Year inflation was down to 2% (from last months 2.1%), and missed expectations significantly.  You can find informative charts at BLS (Bureau of Labor Statistics).  From the Federal Reserve's hopes and beliefs, this is a disappointing report.  However, the USA has been printing weak economic data for over a month (even since the beginning of the year), and the equity markets and the treasury market have ignored the news as equity markets continued to make historic highs.  Conclusion?  Data is still inconclusive, and Bloomberg's (not so bad) view is right in the context of the surge in April.

7.   China printed some good data overnight.  Industrial output rose at a 8.8% clip Y-Y.  Retail Sales increased 12.5%.  Now would not the USA love to have that number?  Did the Chinese government step up stimulus?  It appears they did, and it appears to be working.  Why would it work there and not in the USA (or Europe)?  Because China is not in debt beyond their ability to ever pay.  In fact, they can stimulate and not cost any sovereign debt just from reserves.