DHUnplugged #725: Minsky Moments

Yields important again – rising and worrisome.

Hedge Fund titans getting nervous – talking bout a Minsky Moment.

End of month – October is about to be in the books.

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Warm-Up
- Yields important again - all of a sudden
- Hedge Fund titans getting nervous - talking bout a Minsky Moment
- End of month - October is about to be in the books

Markets
- Earnings season - Tech is about to bombard us
- Gold near highs as China and India buying
- Election Direction - putting money where mouth is...
- Consumers are happier - UMICH
- NAZ 100 - ATH?

Yields - On the Move

  Yields On The Move

Auto Divergence
- GM puts out some good numbers for recent quarter.
-- GM now expects full-year adjusted EBIT of between $14 billion and $15 billion, or $10 and $10.50 a share, up from between $13 billion and $15 billion, or $9.50 and $10.50.
- This marks the third time this year that GM has updated its guidance after beating Wall Street’s top- and bottom-line expectations, led by the automaker’s North American operations.
-  Ford put out okay numbers, nothing exciting at this point - stock stuck in sideways action
- Big differential with stock performance over past year

GM/FORD YTD

GM/Ford Longer

New Threshold for Capital Gains
- Starting in 2025, single filers will qualify for the 0% long-term capital gains rate with taxable income of $48,350 or less and married couples filing jointly are eligible with $96,700 or less.
- Here is an idea  - for low basis stock - possibly gift to non-dependents that have low income and they can sell at lower capital gains rate
--- Cannot do for dependents as their unearned income above $1,300 is the threshold.

Consumer Sentiment
- October Univ. of Michigan Consumer Sentiment - Final 70.5 vs. 68.9 Briefing.com consensus; October prelim was 68.9
- Markets reacted positively last Friday on this news.
---  Trivia: The University of Michigan (UMich) stopped releasing early versions of its Consumer Sentiment Index (MCSI) in 2013 as part of an agreement with the New York Attorney General's office. The university had previously received around $1 million a year from Thomson Reuters for this information.

Hedge fund big boys
- Getting nervous - Paul Tudor Jones
- The founder and chief investment officer of Tudor Investment said he was worried that government spending could cause a big sell-off in the bond market, spiking interest rates higher.
- Debt unsustainable and people just overlooking it
- "Will we have a Minsky moment