TOPLEY’S TOP 10 November 05, 2024

1. Update on Market Timers

https://www.marketwatch.com/story/the-bear-market-is-coming-and-its-going-to-be-painful-3380e5fa?cx_testId=22&cx_testVariant=cx_1&cx_artPos=0&mod=home-page-cx#cxrecs_s


2. Election Day Stock History


3. Europe-Two Decades Sideways

MarketEar Blog


4. Why? Americans Work Harder.


5. Gold Not Trading As Inflation Hedge


6. 5 Years U.S. National Debt +56%…Gold Trading as Debt Hedge.

@Charlie Bilello


7. NVDA Added to Dow Jones…History of Stock Performance After Being Added.


8. China Demographics -Not Good.


9. Electoral Colleges Votes by State

Visual Capitalist

https://www.visualcapitalist.com/mapped-electoral-college-votes-by-state-for-2024-election


10. Why Grit and Willpower Fail and What to Do Instead -Psychology Today

Exploring the merits of healthy hedonism when it comes to wellness-Mike Rucker Ph.D.
Key points

  • Treat exercise as a fun activity rather than a chore to foster consistency and enjoyment in wellness routines.
  • Shifting from restrictive diets to a positive relationship with food supports lasting health and satisfaction.
  • Over-quantifying wellness can harm enjoyment; too much tracking risks turning joy into obligation.
  • Enjoying wellness activities, aka “healthy hedonism,” is crucial for sustaining positive health behaviors.

Too often, aspirations in the pursuit of wellness are misguided. The advice takes on a perfectionistic angle, pushing individuals to believe that rigid standards are what is required to move the needle when it comes to improving health.

Recently, my medical provider just pushed out a newsletter advocating the 75 Hard program, an ultra-rigid self-improvement protocol with such a high bar that a quick Google search makes it clear it sets most participants up for failure. In my provider’s defense, their newsletters are put together well and generally well-researched. However, this particular one (I presume) was meant to be more inspirational in nature.
Still, I felt compelled as a behavioral scientist to let them know that research indicates that wellness regimens that require this unforgiving level of adherence have a poor track record of long-term success. On the contrary, these types of programs come with the risk of actually harming both physiological and psychological well-being. Instead, what is emerging as one of the most useful components of any health intervention is enjoying the journey. Engaging in something you at least derive some pleasure from—sometimes referred to as healthy hedonism—appears to be a stronger predictor of sustained wellness behavior when compared to most other factors.

It Starts With Finding What Works for You
When it comes to exercise, one size does not fit all. The good news is that the wellness landscape has significantly evolved over the past few decades to offer a diverse selection of approaches to fitness and movement, which means there is a high likelihood that there is a type of exercise or wellness practice that fits your preferences and lifestyle.
As someone whose livelihood depends on helping health club operators design the optimal customer experience, it is not surprising I caught some flack when I wrote in my book The Fun Habit, “If you hate the gym, don’t go! It’s not for everybody. Instead, pick a physical activity with no commute, like bodyweight exercises in your own home or a nature hike in a nearby park.” But the assertion wasn’t meant to cause controversy. On the contrary, it was to highlight the fact that when people don’t find fun in what they’re doing, they tend to fail.
When we start our health journey by honoring our unique preferences, we are able to redefine wellness as a source of joy. When we stack the deck in our favor by scheduling activities we are drawn to that are also helpful in supporting a healthy lifestyle, we don’t need to rely on willpower to push through and keep going when it comes to fitness. Instead, we turn exercise into something “we get to do” rather than something “we have to do.”

The Joy of Cooking
Healthy hedonism isn’t just about fitness; it is also about embracing the enjoyment of food without the guilt often attached to indulgence. Weight loss programs that are restrictive are well-known to have a low success rate, yet this fact has done little to slow down the popularity of fad dieting. When we are able to move away from the idea of a “diet” and instead cultivate a healthier relationship with eating—free from restrictive diets and shame cycles—we generally have better long-term results. Learning to cook with nutrition-dense whole foods, appreciating the flavors and colors of nutritious meals, as well as the experience of eating well-crafted dishes, mitigates the hazards of processed foods and mindless eating.

Prioritizing Experience Over Metrics
With so many health apps at our fingertips, it’s easy to reduce our wellness to numbers. I am a strong advocate of digital health, and when designed well, the right contextually relevant piece of consumer health technology can have a substantial positive impact on one’s health. However, I am also an opponent of overly quantifying health because of its negative impact on healthy hedonism.
Dr. Jordan Etkin, a researcher from Duke University, has looked into this extensively. Her research highlights some of the unintended negative consequences of overfocusing on health metrics served up by technology, which can erode the inherent fun from an activity we once found enjoyable. For instance, while activity trackers might initially increase the frequency we partake in an activity because they focus our attention on the amount we are doing (such as walking or reading), this redirection of attention runs the risk of simultaneously reducing how much we intrinsically enjoy those activities. Over time, the result is that we are no longer drawn to the activity we once enjoyed, so we abandon it.
Unfortunately, this phenomenon transcends physical activity into other areas of wellness. For instance, the popular meditation app Waking Up, created by Sam Harris, removed the prominence of its quantitative features when Sam recognized they were creating what he referred to as “spiritual materialism”—bringing the user’s focus outward instead of inward (where an inward focus is the app’s goal).

Healthy Hedonism at Its Best
Across all domains, prioritizing presence allows us to savor our experience and connect with what we enjoy, whether it’s a workout, meal, or mindfulness session. In doing so, healthy hedonism steers our focus away from outcomes that are often ephemeral if they are too goal-oriented and instead keeps our focus on finding the joy in what we do and what we experience, nurturing a rewarding relationship with wellness—a basket of fun habits where the result is a long-term sustainable strategy toward maintaining our well-being.

https://www.psychologytoday.com/us/blog/the-science-of-fun/202411/why-grit-and-willpower-fail-and-what-to-do-instead

TOPLEY’S TOP 10 November 04, 2024

1. Seasonality During Election Year

From Dave Lutz Jones Trading AlamanacTrader notes November-January is the top 3-month period for DJIA and S&P 500 in all years and election years. In all years since 1950 DJIA is up 4.3% on average, up 71.6% of the time. S&P averages 4.4%, up 73.0% of the time. In election years, DJIA is up on average 4.3%, up 72.2% of the time while S&P is up on average 4.0%, up 72.2% of the time.


2. Bond Market Sell Off Good for Stocks?

MarketEar Blog

https://themarketear.com/newsfeed


3. Best Election Year Run Since 1924

Bespoke Investors While yesterday ended up being the worst Halloween trading day since 2011, the S&P 500 still ended the month with a year-to-date gain of 19.6%.  That’s good enough for 2024 to be the best Election Year through October since 1936!

https://www.bespokepremium.com/interactive/posts/think-big-blog/bespokes-morning-lineup-11-1-24


4. Estee Lauder 7-Year 26% CAGR Wiped Out

Koylin shows, Estée Lauder has an incredible 10Y chart. The first seven years had a 26% CAGR, followed by three years of a (-44%) CAGR, and now the 10-year total return is close to dropping below 0%.-Zach Goldberg Jefferies


5. Mutual Fund Cash Levels at Historical Low Levels

From the Daily Chartbook Blog


6. Summary of 10-Year Yield Action

Nasdaq Dorsey Wright -10-year yields comprised of inflation expectations and real rates
You can think of it as the sum of:
+ 10-year inflation expectations (what markets think annual inflation will average over the next 10 years)
+ 10-year real rate (a proxy for expected real economic growth)
And the +60bps increase in the 10-year Treasury yield (chart below, black line) is driven by both the inflation (orange line) and real (green line) components.

Inflation expectations increasing on stronger economy, geopolitical tensions, and government spending
10-year inflation expectations are up +20bps (orange line) to 2.3%. There are a few reasons why:
+ Rising geopolitical tensions, which could increase energy inflation
+ With analysts projecting both Presidential candidates will increase government spending (especially in red wave/blue wave outcomes), expectations are rising that increased government demand will boost inflation
+ A stronger economy (next section) sees increased demand, adding to inflation
 Real rates rising on a stronger economy and Fed rate cuts reducing recession odds
10-year real rates are up +40bps (green line) to 1.95%. Again, for multiple reasons:
+ The Fed’s pivot to rate cuts reduced the risk of recession, meaning higher average economic growth over the next 10 years
+ Stronger-than-expected economic data over the last couple months (+254k jobs in September, Services PMI up to 17-month high, better consumer spending, etc) further reduced recession odds
+ Expectations of increased government spending (previous section) will add to economic growth

https://www.nasdaq.com/solutions/nasdaq-dorsey-wright


7. Sticker Shock on New Car Prices

Bloomberg By Keith Naughton –Sticker shock is increasingly scaring off many would-be buyers. A recent survey by automotive researcher Edmunds.com found that almost half of American car shoppers expect to pay $35,000 or less for a new car. That makes sense because the average trade-in is six years old, which means those buyers last purchased a new car back when the average price was in the mid-30s. When they return to the showroom and discover they’ll have to pay almost $50,000, they’re walking away. The Edmunds survey found that 73% of consumers are holding off on buying a new car because of the cost.

https://www.bloomberg.com/news/articles/2024-11-04/soaring-2024-new-car-prices-turn-more-buyers-toward-used-vehicles?srnd=homepage-americas&sref=GGda9y2L


8. Job Openings Slowing Down

https://dailyshotbrief.com


9. Private Equity Shifts to Operational Efficiency of Portfolio Companies

Pitchbook Madeline Shi
The PE industry is placing a greater emphasis on enhancing the value of portfolio companies by improving their operations—or at least, that’s the message many GPs are trying to convey to their LPs, industry participants tell me.

The concept of value creation has taken on new importance as high interest rates and a tepid exit environment have forced many firms to reinvent the strategies they use to generate returns.

“Many of them in the past were doing great by just doing ‘buy low, sell high,’ having the right strategy for portfolio companies, placing the right management and using financial leverage,” said Romain
Bégramian, a managing partner at Paris-based advisory firm GP-Score. “But now they’re eager to improve operational value creation, or at least they are saying that to their investors.”

The strategy was spotlighted on Apollo‘s investor day in October, when the private equity titan lauded its ability to capture excess return in its PE investments through operational improvements at portfolio companies. That came in stark contrast to the broader PE industry’s strategy for the last decade which, by and large, leaned most often on multiple expansion and topline growth for returns.

David Sambur, the co-head of equity at Apollo, quipped: “What is the purpose of investing in private equity if it’s just levered beta on steroids?”
As I reported this week in “Mid-market deals fare best in boosting profitability,” the ability to grow margins tends to set the best PE investments apart.

A difficult market for selling assets has also prompted GPs to pay more attention to operational matters—crafting ways to improve cash flow, widen margins and formulate detailed plans for long-term strategic growth.

But improving portfolio companies this way is no small feat. It is an intricate undertaking that impacts various aspects of a company, including its operations, technology and people.

Operational value creation could involve any number of projects, such as optimizing a legacy IT system or reducing surplus raw materials accumulated during the COVID-19 pandemic. It could mean an exciting endeavor to implement cutting-edge technology—AI, for example—or involve making a tough decision to cut long-tenured employees.

https://pitchbook.com/news/articles/pe-playbook-zeroes-in-on-value-creation?utm_medium=newsletter&utm_source=weekend_pitch&utm_campaign=PE_news&utm_content=feature&utm_term&sourceType=NEWSLETTER


10. Farnam Street Thoughts

Tiny Thoughts
*
Attention isn’t free. It’s the most valuable thing you spend.
**
Flashy gets attention. Boring gets results.
While most chase the views, the greats obsess over the basics.
***
Don’t curse the obstacle; find a way around it.
Elite special forces don’t complain about defenses—they adapt their tactics or create new ones. When a primary route is compromised, they don’t waste time lamenting. They quickly shift to another approach. Elite athletes don’t complain about defenses—they find the gap or create one.
Face the obstacle. Find the gap. Or make one.

Insights
*
Agatha Christie on love:
“It is a curious thought, but it is only when you see people looking ridiculous that you realize just how much you love them.”
**
Alexander Graham Bell on looking for the opportunity:
“When one door closes, another opens; but we often look so long and so regretfully upon the closed door that we do not see the ones which open for us.”
***
Sam Altman on avoiding regrets:
“If you think you’re going to regret not doing something, you should probably do it. Regret is the worst, and most people regret far more things they didn’t do than things they did do.”
https://fs.blog/

TOPLEY’S TOP 10 November 01, 2024

1. FANG+ ETF Did Not Make New Highs


2. MAG 7 ETF Reversed Right at Previous Highs


3. SMCI Hit $114 in March 2024…$29 Last..Down -75% from Highs

 


4. Blast from Covid Past Charts…PTON +46%

PTON +46% year to date…50 day thru 200 day to upside.


5. Blast from Covid Past …Carvana +400% Year to Date

50 week about to cross above 200 week to upside.


6. ASML Continues Correction…-40% from Highs

ASML Closes below 200 week moving average on long-term chart.


7. Car Sales in Europe

Dave Lutz at Jones Trading TIT FOR TAT China has told its automakers to halt big investment in European countries that support extra tariffs on Chinese-built electric vehicles (EVs), two people briefed about the matter said, a move likely to further divide Europe. The new European Union tariffs of up to 45.3 per cent came into effect on Oct 30 after a year-long anti-subsidy investigation into EV imports from China that divided the bloc and prompted retaliation from Beijing.

The move by the Chinese authorities to suspend some investment in Europe would suggest that the government, keen to avoid a sharp fall in EV exports to the key market, is seeking leverage in talks with the EU over an alternative to tariffs.


8. Alphabet Cash Flow Breakdown


9. Ukraine and Chinese Nationals 400k Encounters at Border

https://www.linkedin.com/in/ericfinnigan1/


10. 7 Steps to Design the Life You Want

TOPLEY’S TOP 10 October 30, 2024

1. Crypto Flows 2024 Triple 2021

Crypto asset flows. “Digital asset inflows reached US$901m last week, pushing year-to-date inflows to US$27bn, nearly triple the 2021 record.”

CoinShares


2. 17-Year Low in Credit Spreads


3. Tight Spreads Have Been Followed by Below Average Equity Returns

@Charlie Bilello  
Is this a good thing to see? Not exactly. In the past, very tight spreads have been followed by below-average equity and credit market returns over the next five years.


 

4. IBIT New All-Time High


5. Coinbase All-Time High Stock Price was $429

Perplexity


6. Retail Gas Prices Trend Down-Y Charts

https://ycharts.com/indicators/us_gas_price


7. Yale Endowment Models Falters as VC Distributions Slow

Pitchbook Jessica Hamlin
Yale University‘s endowment reported one of the weakest annual investment performances in the Ivy League.  The endowment saw a 5.7% investment return for the fiscal year ending June 30, 2024, as a lack of exits in its private market investments continues to batter the portfolio’s one-year returns. Yale’s FY return places it second from the bottom of performance at the Ivy League institutions that have reported so far this year, landing just above Princeton’s 3.9% gain.
After riding the highs of private market dealmaking and valuations and returning a record 40.2% on its investments in 2021, the endowment has since—along with its peers—endured nearly three years of minimal distributions from its private market managers. In the 2022 and 2023 fiscal years, the now $47 billion endowment returned 1.8% and 0.8%, respectively.
The endowment’s one-year return placed it behind peers like Columbia and Harvard Universities, which saw 11.5% and 9.6% gains for FY 2024, respectively.
In VC, initial public offerings and large M&A transactions have been scarce during this period. In Q3 2024, VC fund distributions to LPs hit a rate nearly as low as the state of returns during the global financial crisis, according to the

 Q3 2024 PitchBook-NVCA Venture Monitor. https://pitchbook.com/news/articles/yale-university-endowment-exit-drought?utm_medium=newsletter&utm_source=daily_pitch&sourceType=NEWSLETTER


8. Cash Out Re-Fi’s Go Negative…Pent Up Demand When Rates Move Lower

WSJ By Ryan Dezember  
More homeowners are borrowing against the rising value of their properties, suggesting that the worst of the remodeling slump has passed.
Analysts and building-products executives are forecasting lower interest rates will fuel a rebound next year in spending on new kitchens, bathrooms and decks, reviving a reliable source of economic activity and stock-market gains.

https://www.wsj.com/economy/housing/home-renovation-loans-2025-858e386d


9. Podcasts Keep Growing -Chartr


 

10. The Stages of Well-Being

TOPLEY’S TOP 10 October 29, 2024

1. 2022 Once a Generation Experience?  Stock and Bonds Both Down Teens


2. Seasonality Favorable


3. S&P Has Not Had Two Down Days in a Row for 30 Sessions

The chart -Marketwatch 
Investor buy-the-dip mentality has been on show of late. The chart from Jason Goepfert at Sentimentrader shows how the S&P 500 has not had two down days in a row for 30 sessions. When the stock benchmark has the temerity to register a negative day investors push it up the next.  “This is one of the longest streaks in its history, with the Nasdaq not far behind,” says Goepfert. Similar streaks of buy-the-dip activity preceded gains over the next 6-12 months almost without fail, he notes.

Source: Sentimentrader
https://www.marketwatch.com/story/theres-a-generational-opportunity-for-investors-in-this-sector-says-jpmorgan-a82c6c5d?mod=home-page


4. Tesla Forward P/E 81x vs. NVDA 35x

Tesla hitting resistance in chart


5. Peak Earnings Week

Dave Lutz Jones Trading
-This is arguably “Peak Earnings Week”
 with 34% of IWM’s Market Cap, 31% of SPY’s and 30% of QQQs reporting


6. DJT Media Now +185% in One Month


7. Sales of Existing Homes Back to Early 1990’s Levels…Inventory Moving Back to 2016 Levels

Wolf Street Blog

https://wolfstreet.com/2024/10/23/demand-destruction-for-existing-homes-sales-in-2024-to-plunge-below-4-million-homes-lowest-since-1995-as-supply-spikes/


8. Manufacturing Reshoring -Breaks Down to Sub-Sectors

From Barry Ritholtz Blog
The US manufacturing construction boom is massive

Source: @Joseph_Politano


9. Poor sleep in early midlife years could mean higher dementia risk: Study

by Anna Kutz

  • Study compared baseline sleep data with MRI scans taken years later
  • Having more ‘poor sleep characteristics’ linked to dementia development
  • Daytime sleepiness, early morning wakeups are two characteristics

(NewsNation) — Those tossing and turning throughout their early midlife years may be more susceptible to dementia as they age, researchers found.
The new study, published Wednesday in the journal Neurology, analyzed 589 people’s brain scans for a connection between sleep quality in people in their 40s and their brain age later in life.
Researchers found a “dose-response relationship” between the two factors, with those who reported more poor sleep characteristics at 40 showing an advanced brain age in MRIs obtained 15 years later.
Poor sleep characteristics include:

  • Bad sleep quality
  • Difficulty initiating sleep
  • Difficulty maintaining sleep
  • Early morning awakening
  • Daytime sleepiness

Patients who reported two or three characteristics had a brain age that was 1.6 years older than people who only reported one characteristic, which made up roughly 70% of the pool.
However, those with more than three characteristics — around 8% — showed a brain age 2.6 years older than their counterparts.
When will the next COVID, flu surge start? Experts weigh in 
“Sleep problems have been linked in previous research to poor thinking and memory skills later in life, putting people at higher risk for dementia,” study author Dr. Clémence Cavaillès told MedPage Today. “Our study which used brain scans to determine participants’ brain age, suggests that poor sleep is linked to nearly three years of additional brain aging as early as middle age.”
“Advanced brain aging is associated with cognitive decline and Alzheimer’s-related atrophy patterns,” Cavaillès added. “Therefore, poor sleep may be an important target for early interventions aimed at preventing neurocognitive decline, even before amyloid and tau accumulation begins.”
The researchers used CARDIA, a long-term federal study of cardiovascular disease, to obtain baseline data. As the characteristics were self-reported, study leads acknowledged that some people’s sleep data could have been misreported.

Tags  https://thehill.com/homenews/4956431-poor-sleep-dementia-risk/


10. Emotional Intelligence