DHUnplugged #619: Dire Warnings

Up, Up and Away. When everyone thinks there is more downside, this happens.

China economics are weak and probably getting weaker.

Peter Schiff and others warn about what will come next...

Dire predictions and buoyant markets - with a side of short squeeze.

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Warm Up

- ESG Finally Getting a Probe

- Big Week for Retail (Earnings)

- Peloton - Restructuring and  changing prices again

- Can't keep this market down - well, at least for a while..

Market Update

- Fed continues to press for higher rates

- China issues a surprise rate cut (minor)

- The Bear Bounce? New Rally - Lows are In?

- China's Pain is Oil's Pain

- OH - The Squeeze is On! - But Still seeing Dire Warnings about what is to come...

- Musk comes Tweets he is buying.. At 8:01PM

COMING UP THIS WEEK ON TDI Podcast - Peter Schiff

Big Calls

- Peter Schiff doesn’t think the Fed can beat the current inflationary pressure America is dealing with today. “Not only can’t the Fed win a fight against inflation without causing a recession, it can’t do so without causing a far worse financial crisis than the one we had in 2008,”

- “Worse still, a war against inflation can’t be won if there are any bailouts or stimulus to ease the pain,”

Where to begin this week?https://www.dhunplugged.com/wp-content/uploads/2022/08/CAPE_20220816.jpg

Now this is interesting - Market Valuation...

CAPE RATIO

The SQUEEEEEZE

- Here we go again - low-quality, High Short-interest stocks getting the love

- BBBY up 200% past couple weeks, 65% TODAY!

- Party City up 27% TODAY

- FUBOTV, Blue Apron, My Size, ThredUp, Cruise Lines (after secondary offerings), GameStop on the move too....

- What does this mean?

Markets

- So many overbought readings

- Multi-Month Highs

- Valuations?

- What is the great spirit that is moving things - why so bullish all of a sudden?

ELON!

- 8:01PM (After hours markets closed)

- - "Also, I’m buying Manchester United ur welcome"

--- Is he serious? News reports are unclear - no one knows for sure what this is all about

Earnings

- Home Depot - beats (significantly lowered expectations - low bar)

---- Earnings Growth 8% YoY, Revenue 6.5%

------Higher product prices drove average spending per transaction up more than 9%, even as customer transactions at its stores dropped 3%, helping the company record its highest ever quarterly sales and earnings.

- Walmart - same story as Home Depot (management did not downgrade any further this time)

---- Earnings - slightly lower than 1-year ago, revenue growth 8.4%

- Shoppers are shopping, looks like they are buying less higher priced products is the story

WMT Beat Lowered Earnings Estimates

WMT Estimates

Housing - Stinks

- The National Association of Home Builders/Wells Fargo Housing Market Index dropped 6 points to 49 this month, its eighth straight monthly decline.

- The index has not been in negative territory since a very brief plunge at the start of the Covid pandemic. Before that, it hadn't been negative since June 2014.

- Regionally, on a three-month moving average, builder confidence in the Northeast fell 9 points to 56, and dropped 3 points in the Midwest to 49. In the South it fell 7 points to 63, and in the West, where home prices are highest, it declined 11 points to 51.

- The biggest hurdle for buyers right now is affordability

Peleton

- Peloton Interactive Inc said on Friday it would cut jobs, shut stores and raise prices on its exercise equipment including treadmills and top-end bikes as it undertakes a company-wide revamp to shore up its revenue and improve cash flow.

- Shifting final mile delivery to third-party logistics provi...