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The Morning Call--The Higher The Rise, The Bigger The Fall

Jan. 07, 2021 9:20 AM ETCVS, MSM
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Value, Growth At A Reasonable Price, Dividend Investing

Seeking Alpha Analyst Since 2010

Steve Cook received his education in investments from Harvard, where he earned an MBA, New York University, where he did post graduate work in economics and financial analysis and the CFA Institute, where he earned the Chartered Financial Analysts designation in 1973. His 46 years of investment experience includes institutional portfolio management at Scudder. Stevens and Clark and Bear Stearns, managing a risk arbitrage hedge fund and an investment banking boutique specializing in funding second stage private companies. Through his involvement with Investing for Survival and Seeking Alpha, Steve hopes that his experience can help other investors build their wealth while avoiding tough lessons that he learned the hard way.

The Morning Call


The Market


Wednesday in the charts.

Big-Tech & Bonds Battered But Bitcoin Bid On 'Blue Wave', Gold Pumped'n'Dumped

Will the dollar weakness continue?

Is A Weak US Dollar A Key Macro Theme For 2021?

The dollar’s technical picture may be changing.

Shhh the dollar is up...and shorts are at decade extremes

Global economy braces for $13 trillion in debt maturities.

World's Top Economies Brace For $13 Trillion Debt Maturity Vortex



The Economy


Weekly jobless claims rose 787,000 versus expectations of 800,000.

Jobless Claims Improved Last Week Thanks To 'Odd' Plunge In Illinois

November factory orders rose 1.0% versus projections of +0.7%.

The December final services PMI was reported at 54.8 versus estimates of 55.3; the composite PMI was 55.3 versus 55.7.

December light vehicle sales came in at 16.3 million versus November’s figure of 15.5 million.

December Vehicles Sales increased to 16.27 Million SAAR; Annual Sales off 14.7%


November German factory orders rose 2.3% versus consensus of -1.2%.

November EU retail sales fell 6.1% versus predictions of -3.4%.

December EU consumer confidence was reported at 45.5 versus 45.6 in November; German consumer confidence was 47.1 versus 45.6; UK consumer confidence was 54.6 versus 55.0.

Saxo Chart Of The Week : OECD Private Sector Confidence

December EU economic sentiment was 90.4 versus forecasts of 90.0; industrial sentiment was -7.2 versus -8.1; services sentiment was -17.4 versus -15.0.

The December EU construction PMI was 45.5 versus 45.6 in November; the German construction PMI was 47.1 versus 45.6; the UK construction PMI was 54.5 versus 55.0.


For the economic optimists.

Better Times Ahead: What to Expect of the Economy in 2021 - Worth

Saudi Arabia cuts oil production to allow Russia to increase its own.

Saudi Arabia Will Cut Its Oil Production, Allowing Russia's to Grow

Heavy truck sales down 5% YoY.

U.S. Heavy Truck Sales down 5% Year-over-year in December

The Fed

The Fed released the minutes of its latest FOMC meeting yesterday. The tone was more upbeat on the economy than its predecessors, though the Fed left rates and QE unchanged, and, indeed, suggested that neither would change until well into 2021 or even 2022. So, QEInfinity will continue.

FOMC Minutes Show Fed Discussing 2013-Like Taper To Bond-Purchases

Here is some additional commentary.

Morgan Stanley: The FOMC Has Begun To Envision How It Will Taper QE

Bottom line. We are in a delicate balancing act right now. Valuations continue to push into the stratosphere. On the other hand, the Fed continues to pump liquidity into the markets. Plus, fiscal policy appears to be headed into a more expansionary phase. As this author points out, it is impossible to know when investor sentiment will begin to factor in price; so, equities can reach even higher valuations But that will only increase the magnitude of the ensuing mean reversion in price. At the moment, I am 50% invested; most of my holdings are in low P/E, high yielding stocks, along with some gold. Caution.

Waiting for the Last Dance


One of The Great Bubbles of Financial History - The Irrelevant Investor

Update on valuations.

Is the Market Still Overvalued?

‘Cash on the sidelines’ is hogwash.

Investors are waiting for 'cash on the sidelines' to juice the stock market - this is why that idea is hogwash

Contrarian tilts for your portfolio.

Contrarian Tilts for Your Portfolio

The case against value stocks.

The Case Against Value Stocks - Part II - Validea's Guru Investor Blog

News on Stocks in Our Portfolios

MSC Industrial Direct (NYSE:MSM): Q1 Non-GAAP EPS of $1.10 beats by $0.01; GAAP EPS of $0.69 misses by $0.36.

Revenue of $771.9M (-6.3% Y/Y) in-line.

CVS Health (NYSE:CVS) declares $0.50/share quarterly dividend, in line with previous.

What I am reading today

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Analyst's Disclosure: I am/we are long cvs, MSM.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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