Topley’s Top 10 – April 12, 2023

Daily Top Ten No Comments

1. Percentage Positive Returns by Month in Stock Market

Dorsey Wright

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

2. Growth Outperforms Value in Quarter One…”Growth” ETFs Huge Disparity in Sector Holdings

Barrons Invesco S&P 500 Pure Growth (RPG), for example, currently has 28% in energy stocks and only 14% in tech, while iShares S&P 500 Growth (IVW) has 34% in tech and just 8% in energy. Vanguard Mega Cap Growth has more than 50% in tech and less than 1% in energy, while First Trust Large Cap Growth AlphaDEX (FTC) has 16% and 19% in the two sectors, respectively.  By Evie Liu

https://www.barrons.com/articles/how-to-pick-growth-stock-funds-fc843e01?mod=past_editions

3. Bond Volatility Much Higher than Stock Volatility

4. Share Buyback ETF No New Highs Yet.

PKW got to withing 4 points of previous highs

5. S&P Dividend Growers did Make the New Highs.

SDY underperforming 2023 but made new highs in beginning of year.

www.stockcharts.com

6. Small vs. Large Bank Exposures

JP Morgan Private Bank

https://privatebank.jpmorgan.com/gl/en/insights/investing/tmt/the-ripple-effects-of-the-bank-crisis?pid=&programName=20230331-NAM-ES-INV-Top%20Market%20Takeaways&utm_source=email-pb&utm_medium=Other-NA&utm_campaign=20230331TMT&utm_content=CTA&mkt_tok=MzkyLUhLQy04NzYAAAGK13yFshRFVbOpHiqBgT_eXh-rDEngj4KiJ72NpBsgNj2KEMNaewNVhU35JTUE-rFJy469wrg8Hmqi-HPdRgWLgSnVEVtyI3Adpq3GWYOyJmQTJA

7. China New IPO Policy …1 Firms Launched Monday with 96% Average Return

China’s first batch of shares under new IPO system surge in debut

Reuters

SHANGHAI/SINGAPORE, April 10 (Reuters) – Some shares among the first batch of stocks to list under China’s registration-based initial public offering (IPO) system more than tripled in their debut on Monday despite tepidness in the broader market.

The listing of the 10 companies on the main boards in Shanghai and Shenzhen marks the full roll-out of China’s new U.S.-style IPO mechanism, designed to make public share sales more market oriented.The system has already been adopted by Shanghai’s tech-focused STAR Market, Shenzhen’s start-up board ChiNext and the Beijing Stock Exchange for smaller companies.Shenzhen CECport Technologies Co (001287.SZ), an electronic components distributor based in the southern technology hub of Shenzhen, opened up 161% on Monday, and surged by as much as 239%, after it raised 2.25 billion yuan ($327.18 million).

Under the new rules, there is no daily trading limit for the first five trading days for shares that have listed after an IPO. Previously, new stocks listed on China’s main boards could jump as much as 44% and slump no more than 36% in their debut.

However, after those five days, stocks listed on the main boards will be subject to the regular 10% daily trading limit.  Dencare Chongqing Oral Care Co (001328.SZ), an oral products maker, opened up 98% and soared by as much as 214%. The other eight companies, including Shaanxi Energy Investment Co (001286.SZ) and Both Engineering Technology Co (601133.SS), rose by between 50% and 120%.Ade Chen, the general manager of asset manager Fund Investment in Guangzhou, said the stocks surged as “their valuation and debut prices are not expensive”.

CECport Technologies’s IPO was priced at 26.8 times its earnings, below the industry-wide valuation in 2021 of 35 times earnings, according to its prospectus.Dencare’s price-to-earnings ratio for the IPO was 36.8, versus a wider industry valuation of 51.6 in 2021, its prospectus said.

Both figures indicate the companies are undervalued relative to their peers.  “Afterwards, investors will focus more on companies’ growth potential and fundamentals,” Chen said.Overall, China’s stock benchmark index (.CSI300), slipped roughly 0.3% on Monday, as investors focused on China’s drills around the Taiwan Strait and awaited more data to gauge the strength of China’s economic recovery after it dropped restrictive COVID-19 policies.The market-oriented IPO system reform is expected to speed up listings and corporate fundraising, as Beijing seeks to revive an economy ravaged by COVID restrictions.

“The changes brought about by the IPO reform are all-round and fundamental, centred by information disclosure,” Yi Huiman, the chairman of the China Securities Regulatory Commission (CSRC) said, according to a report from state media CCTV on Monday.

“The service function of the capital market to the real economy, especially technological innovation, has been greatly improved,” Yi said.

($1 = 6.8769 yuan)  https://www.reuters.com/markets/deals/chinas-first-batch-bluechips-under-new-ipo-system-surge-debut-2023-04-10/

8. Commercial Real Estate and GDP Growth

After the housing bubble burst in 2008, construction of new homes declined more than 50%, and residential investment pulled GDP growth down by 1% for three years.

With commercial real estate construction being roughly 75% the size of residential investment, and fewer skyscrapers and shopping malls being built, the bursting CRE bubble could be a drag on GDP growth of around 0.75% over the coming three years. This should be compared with a 2% potential growth rate for the US economy (according to the CBO).

In other words, with the commercial real estate bubble bursting, we are likely to enter three years with low growth, similar to what we saw after the housing bubble burst in 2008. Put differently, once the Fed starts cutting rates later this year, interest rates will likely stay low for several years, and QE is likely to come back in 2024.

Torsten Slok, Ph.D.Chief Economist, PartnerApollo Global Management

9. State Tax Revenue at Record Highs

Capital Group

https://www.capitalgroup.com/advisor/insights/articles/recession-resilience-muni-bonds-can-help-shield-portfolios.html?sfid=1988901890&cid=80963071&et_cid=80963071&cgsrc=SFMC&alias=D-btn-LP-6-A1cta-Advisor

10. Good News: Stress Is Going to Kill You

Psychology Today…But it’s going to take longer than ever.

THE BASICS

  • Stress is endemic to modern society.
  • People are convinced that stress is leading to their demise, and it’s true that stress can contribute to life-threatening illnesses.
  • Compared to 100 years ago, dying of stress-related illness in our 70s or 80s is a luxury.

Welcome to Stress on the Brain. In this blog, I’ll be writing about stress and its impacts on the way we think, the way we behave, and the way we get sick. When I first meet someone and the conversation turns to my area of research, the most common response I get is, “You should study me because I’m so stressed!” This response reflects our culture’s attitudes: Stress negatively affects the way we think. Stress negatively affects our health. Stress is going to kill us.

What I tell people in response is both good and bad news. The bad news? Stress is going to kill you. The good news? It’s probably going to take a long time.

What do I mean by this? Consider that 100 years ago, the average life expectancy in the U.S. was about 54 years. Compare that to our current life expectancy of 76 years (in 2021, the most recent year for which data are available).

What was killing people so young 100 years ago?

Among the top five causes of death in 1923 were infectious diseases such as tuberculosis and influenza. Today, by contrast, four of the top five causes of death are stress-related: heart disease, cancer, chronic respiratory diseases, and stroke. (I haven’t forgotten that over 1 million Americans recently died from another infectious disease, COVID-19, but the point remains that most of the maladies that kill us today are made worse by stress.)

Why is this good news? One hundred years ago, most deaths of American adults were due to infectious diseases occurring in their 50s. Today, by contrast, we have the luxury of dying of stress in our late 70s or even older.

Much of this difference is due to the massive successes of public health.

Clean drinking water. Centralized sanitation. Improvements in maternal and infant health programs. These programs have shifted the causes of death for most Americans from acute infections to chronic diseases. Such chronic diseases are strongly impacted by lifestyle factors such as diet and stress.

Take, for example, the number-one killer of adults, heart disease. The cardiovascular system, including the heart and blood vessels, is a particularly sensitive target of stress. The system includes a pump (the heart) and a sequence of elastic tubes (blood vessels), which are always working.

One of the primary stress responses is to increase blood flow to working muscles to outrun a predator on the proverbial savannah. Just like with any mechanical system, the cardiovascular system will eventually wear out with increased use, as when under chronic stress. Modern stress rarely necessitates running from a predator, so the increased wear and tear on our cardiovascular system is for naught. It just hastens the eventual breakdown of the system.

This doesn’t sound like good news, either. But hold on. Advances in cardiovascular medicine reduce the negative impact of the modern lifestyle on our hearts and blood vessels. The negative impact that stress can have on the cardiovascular system can be counteracted with improvements in diet, exercise, and medicine, prolonging the health of the system into our eighth or ninth decade. The impact of stress is still there, but our modern mitigation techniques allow us to maintain a healthy cardiovascular system for much longer.

If all this sounds too good to be true, you’re correct. I’m glossing over a great deal, including the threat of future pandemics, increased number of deaths of despair, and the widening income gap, all of which threaten to wipe out some of the increases in life expectancy we’ve seen over the last 100 years. My message is this: You can now survive stress for longer than ever in our species’ history. Yes, stress will kill you. Until then, stay vigilant to maintain and expand on the gains that we’ve made. Future generations may have the luxury of being stressed for even longer!

Tony W. Buchanan, Ph.D., is a professor of psychology and neuroscience at Saint Louis University.

https://www.psychologytoday.com/us/blog/stress-on-the-brain/202304/good-news-stress-is-going-to-kill-you

Topley’s Top 10 – April 11, 2023

Daily Top Ten No Comments

1. Money Flowing to International Stocks

From Dave Lutz at Jones Trading In Asia, meanwhile, almost $16bn has flowed into Chinese equities funds, encouraged by Beijing’s reopening after years of stringent coronavirus restrictions. That reopening has also helped in Europe, which is more reliant than the US on exports to China. China accounted for almost half of the $34bn inflows into emerging markets more broadly, according to EPFR

2. History of Nasdaq Bank Index Selloffs

Dragomir Kolev Lessons from prior 20%+ bank sell-offs  Over the past 40 years, the NASDAQ Bank Index declined by 20% or more in five sell-offs, as shown below. The average length of those sell-offs was 516 days, and the average peak-to-trough price drop was 47%. The duration of the current sell-off is 447 days, with a 43% decline on April 6 from the 14 January 2022 peak. History suggests that volatility may last a few more months before we reach a bottom, but that bottom is not far from current trading levels. Historically, bank stock rallies have averaged 61% in the 12 months after the bottom is reached.

https:://www.linkedin.com/in/dragomir-kolev-64588120/

3. Triple B CMBS Spreads Over Treasuries

WSJ By Sam Goldfarb  As of Wednesday, the average extra yield, or spread, above U.S. Treasurys that investors were demanding to hold CMBS with a triple-B rating—the lowest broad investment-grade tier—was 9.52 percentage points, according to an ICE BofA index. That was up from 7.6 percentage points at the end of February and approaching the 10.8 percentage point level reached in March 2020, when local authorities were issuing stay-at-home orders. The average price of the bonds has dropped to around 75 cents on the dollar from roughly 89 cents a year ago.

https://www.wsj.com/articles/investors-retreat-from-commercial-real-estate-bonds-f4bdf040

4. Credit: The Fed’s emergency facility balances continue to rise.

The emergency facility is designed to help banks meet short-term funding needs, and banks have shied away from using it in recent years.

https://dailyshotbrief.com/

5. Costco Retail Spending Indicator

Three Lower Highs in a Row.

www.stockcharts.com

6. Cumulative Layoffs Since October 2022

https://www.bloomberg.com/graphics/2023-layoff-tracker-credit-suisse-ubs-job-cuts/?sref=GGda9y2L

7. Lending Tree Credit Card Data

https://www.lendingtree.com/credit-cards/credit-card-debt-statistics/

8. New Survey Shows That Up To 47% Of U.S. Healthcare Workers Plan To Leave Their Positions By 2025

Jack Kelly  Forbes

The Covid-19 pandemic unleashed wave after wave of challenges and feelings of burnout for United States healthcare workers, and unless changes are made to the industry, nearly half plan to leave their current positions, according to a new report examining the work environment and industry’s future for clinicians.

Elsevier Health, a provider of information solutions for science, health and technology professionals, conducted its first “Clinician of the Future” global report. It revealed current pain points, predictions for the future and how the industry can come together to address gaps—including that 31% of clinicians globally, and 47% of U.S. healthcare workers, plan to leave their current role within the next two to three years.

In the new report from Elsevier Health, published two years after the Covid-19 pandemic began, thousands of doctors and nurses from across the globe revealed what is needed to fill gaps and future-proof today’s healthcare system. The comprehensive “Clinician of the Future” report was conducted in partnership with Ipsos and uncovered how undervalued doctors and nurses feel, as well as their call for urgent support, such as more skills training—especially in the effective use of health data and technology—preserving the patient-doctor relationship in a changing digital world and recruiting more healthcare professionals into the field. The multiphase research report not only understands where the healthcare system is following the Covid-19 pandemic, but where it needs to be in 10 years to ensure a future that both providers and patients deserve.

The “Clinician of the Future” report includes a quantitative global survey, qualitative interviews and roundtable discussions with nearly 3,000 practicing doctors and nurses around the world. The data helps shed light on the challenges impacting the profession today and predictions on what healthcare will look like in the next 10 years, according to those providing critical patient care

According to the report, 56% of respondents said that there has been growing empowerment amongst patients within the last 10 years, as people take charge of their health journeys. When referring to soft skills, 82% said that it’s important for them to exhibit active listening and empathy to the people they serve. Furthermore, nearly half of clinicians cite the allocated time they have with patients as an issue, as only 51% believe that the allotted time allows them to provide satisfactory care.

To ensure a positive shift moving into the future and to fill current gaps, clinicians highlight the following priority areas for greater support:

  • Clinicians predict that over the next 10 years “technology literacy” will become their most valuable capability, ranking higher than “clinical knowledge.” In fact, 56% of clinicians predict they will base most of their clinical decisions using tools that utilize artificial intelligence. However, 69% report being overwhelmed with the current volume of data and 69% predict the widespread use of digital health technologies to become an even more challenging burden in the future. As a result, 83% believe training needs to be overhauled so they can keep pace with technological advancements.
  • Clinicians predict a blended approach to healthcare with 63% saying most consultations between clinicians and patients will be remote and 49% saying most healthcare will be provided in a patient’s home instead of in a healthcare setting. While clinicians may save time and see more patients, thanks to telehealth, more than half of clinicians believe telehealth will negatively impact their ability to demonstrate empathy with patients they no longer see in person. As a result, clinicians are calling for guidance on when to use telehealth and how to transfer soft skills like empathy to the computer screen.
  • Clinicians are concerned about a global healthcare workforce shortage, with 74% predicting there will be a shortage of nurses and 68% predicting a shortage of doctors in 10 years’ time. This may be why global clinicians say a top support priority is increasing the number of healthcare workers in the coming decade. Clinicians require the support of larger, better-equipped teams and expanded multidisciplinary healthcare teams, such as data analysts, data security experts and scientists, as well as clinicians themselves.

“While we know that many nurses are leaving the profession due to burnout, we also know that the pandemic has inspired others to enter the field because of a strong desire for purposeful work,” said Marion Broome, Ruby F. Wilson professor of nursing at Duke University’s School of Nursing. “We must embrace this next wave of healthcare professionals and ensure we set them up for success. Our future as a society depends on it.”

Jack Kelly  https://www.forbes.com/sites/jackkelly/2022/04/19/new-survey-shows-that-up-to-47-of-us-healthcare-workers-plan-to-leave-their-positions-by-2025/?sh=7e6191bf395b

9. Americans Losing Faith in Government to Solve Important Problems-Pew Research

https://www.pewresearch.com.org/politic/2023/04/07/in-divided-washington-americans-have-highly-negative-views-of-both-parties-leaders/

10. Newspaper Delivery Penetration of Population 1950—120%

WSJ When Boys, Not Phones, Delivered the News

Many homes took two papers, a morning and an evening one.

By Bob Greene

I’m no stamp collector, but there is a 3-cent first class stamp, issued in 1952, that I keep in a frame on a bookshelf. The Post Office Department authorized the stamp to honor what the nation considered an essential job.

The rectangular stamp, light purple in color, depicts houses in a typical small town. Against that backdrop is an illustration of a boy with a canvas bag slung over one shoulder. The stamp’s inscription reads: “In recognition of the important service rendered their communities and their nation by America’s newspaperboys.”

I look at that stamp every time there is another news story about the declining circulation of print papers, even as digital circulation grows. Newspaperboys (and girls) were a vital part of the American landscape in the decades before the internet and cable news delivered up-to-the-second bulletins onto people’s screens. Today, print papers mostly are delivered by adults in cars. But that purple stamp celebrated the era when the speediest way of getting news to front doors was a boy on a bike.

How ingrained in the nation’s life was that boy? One proud former newspaperboy—Dwight D. Eisenhower—issued a statement from the White House in 1954 honoring the carriers “not only because they serve our daily family needs, but because they symbolize so many cherished American ideals.”

When Eisenhower mentioned “daily family needs,” he wasn’t being hyperbolic. In 1950 the penetration of American households by newspapers—a statistic measuring in how many homes a newspaper was read each day—was just above 120%. How could the number exceed 100%? Many homes subscribed to two papers—a morning and an evening one.

 

PHOTO: GETTY IMAGES

Part of newspaperboys’ regular duties was to collect by hand, each week or each month, the subscription fees from every home on their route. During World War II, they raised money for the nation’s defense by selling War Bonds and War Stamps as they made their rounds. In appreciation, the U.S. Treasury commissioned a poster featuring a G.I. in combat gear shaking the hand of a newspaperboy. “Thanks Buddy!” the poster proclaimed. “Newspaper Boys have sold over 1¼ billion war savings stamps since Pearl Harbor.”

Some states bestowed annual awards on delivery boys or girls for exemplary work. In Ohio the award was considered so prestigious that it was presented by either the governor or the chief justice of the state supreme court. In 1954 the Bowling Green Sentinel-Tribune explained to its readers that “the newspaperboy completes the job started by the reporter in far-off Asia . . . the photographer in Africa . . . the correspondent in Alaska. . . . But the job is a long way from being finished until the newspaper is in your home.”

For some of us who love this business, there is still no sweeter sound than the solid thump of a rolled-up paper hitting the front stoop. The future may be digital, but to that hardworking newspaperboy on the 3-cent stamp, with gratitude and respect across all the years: Here’s to you.

Mr. Greene’s books include “Late Edition: A Love Story.”  https://www.wsj.com/articles/when-boys-not-phones-delivered-the-news-stamp-post-office-war-bonds-media-print-circulation-cfa4e159

 

Topley’s Top 10 – April 10, 2023

Daily Top Ten No Comments

1. S&P 500 performance around the end of Fed hiking cycles – GS

Internet Bubble was only negative returns since the 1980s after Fed ends rate hike cycle

2. Q1 ETF Leaders All Technology

3. Micro-Cap Stocks Make New Lows as Large Cap Dominates Q1

4. IPO Market Chart to Watch

IPO ETF look for break above this red downtrend line on chart

 

 

5. 20-Year Treasury Bond 4th Run at New High

 www.stockcharts.com

6. Just a Reminder that 10-Year Treasury Yield Broke Downtrend Line Going Back to 1981

 www.stockcharts.com

7. U.S. Federal Government Spending vs. Inflation

@Charlie Bilello A look at federal government spending tells the story, with a 185% increase over the last 20 years, far greater than the overall rate of inflation (64%).

8. Lumber $360 Would Be New Lows….$1700 in May 2021

www.stockcharts.com

9. Billionaires Pouring Money into Fountain of Youth

EXCLUSIVE: First anti-aging pills to hit shelves in 2028, expert predicts – as Silicone Valley races to conquer death

Pills that can help a person reverse the effects of aging could be on the market in the next five years, according to an expert.

Sam Altman, 37, was revealed to have funded biotech startup Retro BioScience to the tune of $180million last month. He is the latest in a long line of Silicon Valley billionaires to throw their considerable wealth behind the science of aging.

Amazon’s Jeff Bezos is reported to have invested $3billion in life-extension startup Altos Labs. PayPal co-founder Peter Thiel invested in the Methuselah Foundation, which has the goal of making ’90 the new 50′.

 

Steele said: ‘With these billionaires, I’m sure some of them are doing it purely for personal gain — they’ve got all this money and they can’t possibly spend it in a single human lifetime.

‘But… if you’re a savvy investor, you can see that anti-aging medication is a huge business opportunity because the potential market is every living human.

‘I think it’s going to be the biggest revolution in medicine since the discovery of antibiotics — and as a savvy business person, you want to be on the leading edge of that revolution.’

While aging does not directly kill people, older people are at risk of many deadly diseases such as Alzheimer’s, heart disease and cancer.

Researchers might have found a way to teach someone’s body to refresh their old blood

Around 100,000 people die from age-related diseases every day, according to the World Health Organization.

Mr Steele says: ‘Aging is the greatest humanitarian challenge of all time.

There are ’20 to 30’ companies developing new drugs known as ‘senolytics’ which kill aging cells in the body, he explained.

In mice, these drugs cause elderly animals to become lively and healthy suddenly.

‘Many of these drugs are drugs that we already understand and use for different purposes, so we don’t have to develop new medications,’ Mr Steele said.

An example of a senolytic treatment is the combination of datasinib, used for chemotherapy, and quercetin, a molecule found in fruits and vegetables.

Used together, they remove aged ‘senescent’ cells responsible for many of the problems associated with aging.

Another potential general anti-aging drug is metformin. First approved in 1994 for type 2 diabetes, the drug has shown promise extending lifespans by improving blood vessel health.

‘Some of those companies are trying to develop new and more effective drugs that could do the same thing better,’ the author said.

‘That’s the sort of thing that’s very, very close to clinical realization. And I’d be shocked if in five years we don’t have some senolytics in the clinic.

‘It probably won’t be for aging at first. It’ll be for a specific disease – and maybe in 10 years, we’ll use it for aging.

‘These things are very, very near term.’

Jeff Bezos’s investment in Altos Labs — the biggest biotechnology company launch of all time — is a longer shot, Steele believes.

The firm specializes finding and developing cell therapies that can halt and eventually reverse the process of aging.

Mr Steele says: ‘This relies on a process called cellular reprogramming. It’s been shown to work on cells in a dish, and there’s some evidence it works in mice – but it’s an incredibly complicated piece of science.

‘It’s like science that seems to have fallen through a wormhole from the future – and even if it does work, do we have the biological applied understanding in the 2020s to turn that into a workable treatment?’

When Altos Labs was announced, Elon Musk quipped on Twitter about the Amazon mogul: ‘If it doesn’t work, he’s gonna sue death!’

 

With labs launching in America and Cambridge, the company is reputed to pay scientists poached from the world’s top universities salaries of up to a million dollars a year.

Steele says that, realistically, treatments we are likely to see in the near term will extend ‘healthspan’ by dealing with age-related diseases — delaying the onset of problems such as dementia.

Dr Cathy Slack, a biologist from the University of Aston, in the UK, agrees, telling DailyMail.com: ‘The goal is to increase the number of years of healthy lifespan rather than extending the late-life period of poor health.’

She said there are now ‘many’ published studies that show that genetic or environmental changes can extend a healthy lifespan.

She says: ‘Many of the biological systems that have been shown to play a role in healthy aging in these animal models are also present in humans and perform similar functions – so there is every reason to believe that these same processes are impacting on human aging.

‘The ultimate goal is really to try and manipulate these systems during human aging to maintain health and quality of life.’

Dr Slack believes that successful treatments are likely to be a combination of drugs and lifestyle changes – and look holistically at all the diseases that afflict people in later life.

She says: ‘Historically, we have viewed the various diseases associated with older age as distinct entities – so research tends to focus on each one rather than looking at them more holistically together as a direct consequence of biological aging.

‘We already know that there are lifestyle changes that will help to maintain multiple aspects of heath during aging.

‘Exercise, for example. But supplementation with drugs that target multiple physiological parameters of aging could have a huge impact on quality of life for older adults.’

https://www.dailymail.co.uk/sciencetech/article-11844303/First-anti-aging-pills-hit-shelves-2028-expert-predicts.html

10. The Daily Stoic Are You Showing Them How To Be A Student?

“Live as if you were to die tomorrow. Learn as if you were to live forever.”

—Mahatma Gandhi

If you think back to when you were a kid, what appeared to you to be the best part about being an adult? No more school. Our parents didn’t have to carry around heavy books or do homework. We never saw them applying to get into this school or that one. It’s sort of sad that, by and large, we show our kids that education stops. That while adulthood is isn’t always fun, one perk is that you no longer have to go to class. That graduation is a final destination.

It doesn’t have to be this way. There’s the story of Epictetus teaching one day when a student’s arrival caused a commotion in the back of the room. Who was it? Hadrian, the emperor. Hadrian’s example clearly had an impact on his successor and adopted grandson, Marcus Aurelius. Late in his reign, a friend spotted Marcus heading out, carrying a stack of books. “Where are you going?” he asked. Marcus was on his way to a lecture on Stoicism, he said, for “learning is a good thing, even for one who is growing old. I am now on my way to Sextus the philosopher to learn what I do not yet know.

If you want your kids to value learning, if you want them to never stop furthering the education you’ve been investing so much time and money and care and worry into, then we have to show them what an adult committed to lifelong learning actually looks like. We have to show them we have not graduated, we are not on summer break, we have not arrived at the final destination of education.

Wisdom, they must learn, is an endless pursuit.

 https://dailystoic.com

Topley’s Top 10 – April 06, 2023

Daily Top Ten No Comments

1. Feb and March 2023….Top 5 S&P Stocks vs. Other 495

Liz Ann Sonder Schwab

https://twitter.com/LizAnnSonders

2. Tech Shares Trading at Large Premium to the Rest of S&P

Equities: Tech shares are trading at a substantial premium to the S&P 500.

Source: The Daily Shot

3. Covid Bank Accounts Whipsaw

@JeffWeniger Wisdom Tree

https://twitter.com/JeffWeniger

4. Europe’s Mega Cap Index FEZ—About to Break to New Highs.

www.stockcharts.com

5. Gold and Silver—Gold Breaks Out to 3-Year Highs

Silver No Break Out Yet…approaching 2022 highs

6. Gold and Silver Miners.

GDX Gold Miners-no highs yet

Silver Miners well off 2021 highs

www.stockcharts.com

7. Bespoke Investment Group–Smartphones Closing in on TAM; Longer Replacement Cycles

For nearly ten years now we’ve been running our Pulse survey of 1,500 US consumers balanced to census that asks them dozens of questions related to personal finance and economic sentiment.  With nearly ten years of data, these survey results are invaluable and give us as good of a read on consumer trends as we can find.  (If you would like to learn more about our monthly Bespoke Consumer Pulse survey and the report we produce that accompanies it, you can do so here.)

Along with broader questions about things like employment, credit card payments, new home purchases, and risk tolerance, we also dive into consumer interest across things like smartphones, streaming services, social media use, and e-commerce.  In regards to smartphones, every month we ask survey takers a simple question: “Do you own a smartphone?”  Below is a chart showing the percentage of respondents that answered “yes” to that question on a monthly basis dating back to July 2014.

In the mid-2010s when we began asking the question, our survey results showed that smartphone penetration in the US was still between 75-85%.  By 2020, that number had moved up to ~90%, and since then it has steadily ticked higher to its current level of 97.2%, which hit a new all-time high this month.  At 97.2%, there’s basically no runway left when it comes to the total addressable market (TAM) of smartphones in the US.  Everyone has one at this point!

The two main competitors in the smartphone space are iPhones and Androids.  In our monthly Pulse survey, we closely track trends in this space for investors and companies that are interested in this data.

Along with there now being basically no room to expand smartphone ownership in the US, another problem for smartphone makers is that consumers are replacing them less often.  Below are the results from a question we ask survey-takers on how long they typically keep their smartphone before getting a new one.  Most respondents to this question typically keep their smartphones for 2+ years before replacing them, but this number actually started to trend lower from 2019 through mid-2021.  During that time, respondents reporting that they replace their smartphones every year or less ticked higher.  This trend shifted again in 2021, however, and since then we’ve seen a larger and larger share of respondents say that they typically keep their smartphone for 2+ years.  Longer replacement cycles mean fewer sales, which is why it’s important for a company like Apple (AAPL) to introduce meaningful new iPhone features that will get consumers to replace their existing iPhones sooner.  (Also, remember that longer-lasting batteries and more durable hardware are great for customers, but they also increase the replacement cycle.)

If you would like to check out our full Bespoke Consumer Pulse report, here’s a link that tells you how to do that.

https://www.bespokepremium.com/interactive/posts/think-big-blog/smartphones-closing-in-on-tam-longer-replacement-cycles

8. Walmart Ecommerce vs. Amazon.

Aisle meet you online

Walmart has revamped its website and app to look less like a standard online storefront, and a little more like a social media feed, with video content and big glossy images of products.
The retail giant’s e-commerce chief explained the importance of the digital refresh, saying “everyone knows that 90% of the U.S. population lives within 15 miles of a Walmart store, but the closest store to our customers is the one in their pockets”. That store is getting bigger, busier and more lucrative for Walmart every single quarter.

Walmart vs. AmazonWalmart, like almost every other company that sells anything on the internet, got a huge boost from the pandemic when consumers were forced to change their shopping habits. Domestic e-commerce sales soared 43% in 2020 alone and, while they generally cooled off a little last year, Walmart’s are still going strong.   That may even be a bit of an understatement — Walmart’s online business accounted for 13% of its total sales last year, and its growth mirrors the pattern from the kings of e-commerce themselves, Amazon. Indeed, Walmart’s US online sales are tracking on a comparable trajectory to Amazon’s, growing from ~$3bn of sales per quarter to ~$17bn of sales per quarter in a similar amount of time — Amazon’s growth period just happened to start 12 years earlier.

Walmart’s growth is obviously less novel, buying online is much more common than it used to be, but it’s impressive nonetheless considering it’s not the company’s core focus. If the slick new social-media-inspired interfaces work, the comparison with Amazon could last a little longer.

www.chartr.com

9. Top U.S. Banks by Uninsured Deposits.

https://www.visualcapitalist.com

10. Five Ways to Live with Integrity

Psychology Today Five Ways to Live with Integrity Jessica Koehler Ph.D.

1.   Self-reflection: Spend time reflecting on your values and beliefs to better understand what is important to you. By identifying your core values, you can make more informed decisions that align with your principles.

2.   Accountability: Take responsibility for your actions, both successes and failures. Own up to it when you make a mistake and learn from the experience. Demonstrating accountability increases trust and credibility with others, strengthening your integrity.

3.   Consistency: Strive to be consistent in your words and actions. Ensure that your behavior aligns with your values and principles, even when no one is watching. Consistency is critical to building a solid foundation of integrity.

4.   Honesty and transparency: Be honest and transparent in your communication with others. Share your thoughts and feelings openly and be willing to listen and consider different perspectives. Practicing honesty and transparency helps cultivate trust and fosters strong relationships.

5.   Ethical decision-making: When faced with difficult decisions, consider your choices’ ethical implications and potential consequences. Seek guidance from trusted friends, family, or mentors to determine the best action.

Impact on Future Generations

Integrity is a critical component of personal character that has far-reaching implications for individual and collective well-being. H. Jackson Brown Jr. once said, “Live so that when your children think of fairness, caring, and integrity, they think of you.” This quote is a powerful reminder of the lasting impact of our actions on future generations. By understanding and promoting the value of integrity, we strive to be role models, embodying fairness, caring, and integrity in every aspect of our lives. In doing so, we can work towards a more compassionate and resilient world where the well-being of individuals and communities is prioritized and nurtured.

https://www.psychologytoday.com/us/blog/beyond-school-walls/202304/the-integral-role-of-integrity

Topley’s Top 10 – March 31, 2023

Daily Top Ten No Comments

1. Seasonality April Strong for Stocks

From Dave Lutz at Jones Trading Bespoke notes Over the last 20 and 50 years, April has been the strongest month of the year for stocks.  Over the last 50 years, the Dow has averaged a gain of 2.09% in April with positive returns 66% of the time.  Over the last 20 years, the Dow has averaged a gain of 2.18% in April with positive returns 85% of the time

2. Money Market Flows Massive But Not as a % of S&P Market Cap….Not Large.

Liz Ann Sonders Schwab Lots of focus on fact that money market mutual fund assets (blue) have surged to new high of late, but as a % of S&P 500 market cap (orange), share is still below COVID bear market level

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

3. Another QQQ Beating Everything Chart.

This chart is QQQ vs. Low Volatility Stocks SPLV…50day thru 200day to upside

www.stockcharts.com

4. Since 2008 Banks Have Traded Inline with 10 Year Treasury….Now Massively Diverging.

Equities: Financials’ share prices have massively diverged from bond yields.

Source: Alpine Macro  https://dailyshotbrief.com/

5. CMBS Spreads the Cheapest in History vs. Comparable Corporate Bonds

GMO Research

https://www.gmo.com/americas/research-library/aaa-cmbs-loss-remote-liquid-and-cheaper-than-ig_insights/?utm_medium=email&utm_source=episerver-campaign&utm_campaign=article-subscription-push&utm_content=Insights&email=mtopley%40lansingadv.com&first_name=matthew&last_name=topley&company=Lansing+Street+Advisors

CMBS Spreads: The Basics

A CMBS spread, also referred to as a CMBS credit spread, is the difference between the interest rate of a CMBS loan and the underlying index on which the interest rate is based on. Since the vast majority of CMBS loans are based on the swap rate, spreads can usually be determined by taking the interest rate of a loan and subtracting the swap rate. Spreads compensate a lender for their risk, as well as providing for some of the profit that the lender will make as a result of the CMBS transaction. Increased spreads also mean increased profits (and risks) for CMBS investors. https://www.multifamily.loans/apartment-finance-blog/cmbs-spreads-what-you-need-to-know/ 

What Is a Commercial Mortgage-Backed Security (CMBS)?

  • CMBS are secured by mortgages on commercial properties rather than residential real estate.
  • Commercial mortgage-backed securities are in the form of bonds, and the underlying loans typically are contained within trusts.
  • The loans in a CMBS act as collateral—with principal and interest passed on to investors—in the event of default.

https://www.investopedia.com/terms/c/cmbs.asp

6. GLD Gold ETF $196 is Breakout Going Back to January 2020

GLD right at 2022 highs….2020 high $196

7. Where did Silicon Valley Transfers Go? JP Morgan

Found at Barry Ritholtz Blog The Big Picture

https://rithotlz.com/2023/03/10-thursday-am-reads-425/

8. Russia says oil sales to India soared 22-fold last year

Sales to India surged in 2022 as European buyers turned to other markets after the Ukraine war, Russian deputy PM says.

Russian oil sales to India surged more than 22-fold last year as European buyers turned to other markets following the conflict in Ukraine, Russia’s deputy prime minister has said.

“Most of our energy resources were redirected to other markets, to the markets of friendly countries,” Alexander Novak said in comments carried by Russian news agencies on Tuesday.

“If for example, we take oil supplies to India, they increased 22 times last year,” he said.

Russia shifted its oil exports to India and China last year as European Union nations sought to end their reliance on Russian energy supplies after Moscow sent troops into neighbouring Ukraine.

The EU imposed an embargo on seaborne Russian oil in December alongside a price cap on Russian crude that was agreed with the Group of Seven industrialised powers.

The shift has meant cheaper Russian energy imports for “friendly” countries, mainly China and India.

Novak said energy revenues accounted for 42 percent of Russia’s federal budget in 2022 and that the country’s energy industry was sustainable, despite the challenges faced by Western sanctions.

Novak, who is in charge of Russia’s energy sector, also noted that supplies to China were increasing as a “result of the great work that has been done in the industry”.

Russia, a major producer and key ally of the OPEC oil cartel, cut crude production by 500,000 barrels per day this month in response to the Western sanctions.

Novak announced last week that the output reduction, which amounts to 5 percent of daily production, would continue through June.

He said the move was part of a response to Western penalties targeting Russia’s oil industry that aim to limit Moscow’s ability to finance its military.

The International Energy Agency this month said Russia’s oil-export revenue sank by almost half in February compared with last year.

https://www.aljazeera.com/news/2023/3/28/russia-says-oil-sales-to-india-soared-22-fold-last-year

9. What Binge Drinking Does to the Brain, and the Gut

In young people, establishing habits that are hard to overcome.  Scott C. Anderson Psychology Today

KEY POINTS

  • Binge drinking alters the gut microbiota.
  • Changes in specific bacteria are associated with emotional and cognitive deficits.
  • Binge drinking in young people can establish lifelong habits that may be hard to overcome.

“The hard part about being a bartender is figuring out who is drunk and who is just stupid.” –Richard Braunstein

John Cryan and Ted Dinan are a pair of dynamic Irish researchers who, over the past decade, have been busily advancing the remarkable science of the gut-brain axis. They coined the term psychobiotic to refer to probiotics and prebiotics that can improve your mood. The idea that mere gut microbes could affect the lofty human brain is humbling. As Cryan puts it, “If microbes are controlling the brain, then microbes are controlling everything.”

Cryan, Dinan, and their team at APC Microbiome, based at University College Cork, recently looked at what happens to gut microbes in young binge drinkers. Once again, there was an interesting connection between gut microbes and the brain—in this case, the boozy brain.

Binge Drinking, Gut Microbiota, and Cognition

The study, appearing in The Lancet and headed by Carina Carbia, found that binge drinking among young people aged 18 to 25 had a long-term impact on their gut microbiota and their cognition. Bingeing increased inflammation and slowed reaction times. Testing showed bingers had emotional deficits and alcohol cravings that were strongly associated with their altered microbiota. Cryan says, “This study highlights the importance of the gut microbiota in regulating craving, social cognition, and emotional functioning.”

I had the wonderful opportunity to write a book with Cryan and Dinan: The Psychobiotic Revolution from National Geographic. During our collaboration, a Guinness or two may have been downed, but no bingeing. We were writing for the layperson, but our prose pales next to Ireland’s legendary hard-drinking bards. The Emerald Isle is known for outstanding literature and enthusiastic imbibing, often pursued simultaneously. Dubliners James Joyce, Oscar Wilde, Jonathan Swift, and Samuel Beckett were brilliant writers who were all known to crawl the pubs for a drop or two. Some of these pubs are famed for that literary patronage.

Irish playwright George Bernard Shaw famously declared that whiskey is liquid sunshine. Less cheerfully, he also asserted that “alcohol is the anesthesia by which we endure the operation of life.” The Irish novelist Brendan Behan, well-known for both his wit and his binges, once described himself as a drinker with a writing problem. Funny, yes; but, sadly, drinking led to his death after he collapsed at the Harbour Lights Bar in Dublin. He was only 41.

Short of killing you, binge drinking can have more subtle effects, including blunted emotional perception. The APC study found that binge drinkers had a difficult time recognizing expressions of sadness or disgust.

Alcohol Cravings

Specific microbial species were associated with impulsive behavior and cravings for alcohol. We now know that many of our cravings may be encouraged by these tiny creatures. By secreting neurotransmitters like serotonin and dopamine, they yank our reins to guide us to their favorite foods. When we binge drink, we encourage a certain class of party bacteria that tend to draw us back to the bar for another round. Some species of Alistipes, for instance, are reduced by binge drinking, while species of Veillonella are increased. You might blame Veillonella for that urge to celebrate.

The study defined binge drinking as “consumption of a large amount of alcohol within a short period of time, leading to a blood alcohol concentration of at least 0.8 g/l.” That works out to about five drinks in a single sitting, which is more common in Ireland (19 percent) than the European average (6 percent). However, averages are deceptive, and Ireland is not the booziest country in Europe. It has some stiff competition from Germany, Latvia, and the Czech Republic, among others.

Still, Ireland has a reputation for drinking, deserved or not. Tina Fey, the comedic actress (with some Irish heritage) said, “In a study, scientists report that drinking beer can be good for the liver. I’m sorry, did I say ‘scientists’? I meant Irish people.” So, perhaps an Irish study of bingeing isn’t totally inappropriate.

Drinking is a deeply entrenched part of humankind. In fact, throughout most of our history, alcohol has been a lifesaver, killing the ubiquitous pathogens in ordinary water. Louis Pasteur, eponymous for killing microbes, said that “wine is the most healthful and most hygienic of beverages.” Alcohol, produced by microbial fermentation, is a potent antiseptic. Pasteur knew that it takes a microbe to fight a microbe.

For as long as there have been guts, beneficial microbes have made a home there, and they play an important role in fending off pathogens. They are an unsung but important part of our immune system.

Our gut microbes, some of which can double in number every half hour, respond quickly to our dietary and drinking habits. As mentioned, depending on what we consume, some microbes thrive while others languish. Amazingly, the complex communities they form can alter our mood and cognition.

Long-Term Problems

These alterations can be persistent, and bingeing at a young age may set us up for lifelong behaviors that can be hard to reset. So, if you are thinking of taking an alcoholiday to visit Margaritaville, pace yourself. Your booze-loving bacteria may enjoy a binge, but the joy you find in the evening will be subtracted from the following morning. Worse yet, you may be setting yourself up for enduring behavioral problems.

Quitting is an obvious solution, but, for many, that can be tough. As Henny Youngman put it: “When I read about the evils of drinking I gave up reading.” But, like many things in life, the dose makes the poison. A recent large study of 4 million Koreans found that three glasses of alcohol or more per day was associated with an increase in rates of dementia. However, one or two glasses a day lowered dementia rates compared with those of teetotalers.

That should cheer moderate drinkers and encourage the rest of us to drink less. Binge drinking, it turns out, might not be the smartest move.

Facebook/LinkedIn image: Hananeko_Studio/Shutterstock

https://www.psychologytoday.com/us/blog/mood-by-microbe/202302/what-binge-drinking-does-to-your-gut-and-your-brain

10. Stress Management

How to Deal with Constantly Feeling Overwhelmed

by Rebecca Zucker  HBR

 

Summary.   The cognitive impact of feeling perpetually overwhelmed can range from mental slowness, forgetfulness, confusion, difficulty concentrating or thinking logically, to a racing mind or an impaired ability to problem solve. When we have too many demands on our…more

Our work lives have become increasingly demanding, presenting us with ever more complex challenges at a near-relentless pace. Add in personal or family needs, and it’s easy to feel constantly overwhelmed. In their book, Immunity to Change, Harvard professors Robert Kegan and Lisa Lahey discuss how the increase in complexity associated with modern life has left many of us feeling “in over our heads.” When this is the case, the complexity of our world has surpassed our “complexity of mind” or our ability to handle that level of complexity and be effective. This has nothing to do with how smart we are, but with how we make sense of the world and how we operate in it.

Our typical response to ever-growing workloads is to work harder and put in longer hours, rather than to step back and examine what makes us do this and find a new way of operating. I have a few clients who fit this description. When we started working together, they each had already resorted to getting up at 4 AM to do work. Sue, who works for a tech company that recently went public, is leading many simultaneous projects and is fearful she’ll miss an important email. Ajay, a senior leader at a late-stage start-up, needs the extra quiet time to try to make a dent in his ever-growing to-do list, but feels like he’s trying to dig himself out of a hole that just keeps getting deeper. Maria, a start-up co-founder, felt constantly overwhelmed as her company started to scale. While CEOs of trillion dollar companies like Apple’s Tim Cook, wake up at 3:45 AM, most of us don’t have quite this level of responsibility.

The cognitive impact of feeling perpetually overwhelmed can range from mental slowness, forgetfulness, confusion, difficulty concentrating or thinking logically, to a racing mind or an impaired ability to problem solve. When we have too many demands on our thinking over an extended period of time, cognitive fatigue can also happen, making us more prone to distractions and our thinking less agile. Any of these effects, alone, can make us less effective and leave us feeling even more overwhelmed. If you are feeling constantly overwhelmed, here are some key strategies to try:

Pinpoint the primary source of overwhelm. Ask yourself the question, “What one or two things, if taken off my plate would alleviate 80% of the stress that I feel right now?” While you may still be responsible for these items and cannot actually take them off your plate, this question can still help you identify a significant source of your stress. If it’s a big project that’s almost done, finish it. Or, if it’s the sheer size of the task or project that is overwhelming you, break it down into more manageable components, ask for additional resources or renegotiate the deadline if you are able — or all of the above.

Set boundaries on your time and workload. This can include “time boxing” the hours you spend on a task or project, leaving the office by a certain time, or saying no to specific types of work. Ajay realized he was spending a significant amount of time mediating conflicts between various team members, which was not only an unproductive use of his time, but also reinforced their behavior of escalating issues to him instead of learning to resolve these problems themselves. Saying “no” to these escalations and setting expectations that they do their best to work out these issues before coming to him, created more breathing room for him to focus on his priorities with fewer distractions.

Challenge your perfectionism. Perfectionism can lead us to make tasks or projects bigger than they need to be, which can lead to procrastination and psychological distress. As things pile up, the sense of overwhelm grows, which can then lead to more procrastination and more overwhelm. Sheryl Sandberg famously said, “Done is better than perfect.” Know when “good” is “good enough” by asking yourself, “What is the marginal benefit of spending more time on this task or project?” If the answer is very little, stop where you are and be done with it. Part of this is also recognizing that we cannot do everything perfectly. Sue was finally able to accept that sometimes an email will be overlooked, and that if it’s important enough, the other person will follow up with her.

Outsource or delegate. Ask yourself, “What is the highest and best use of my time?” Activities that don’t fall within your answer can be taught and/or delegated to others. This can include managing selected projects, delegating attending certain meetings, having a team member conduct the initial interviews for an open position, or outsourcing the cleaning of your home and meal preparation. Maria had the revelation that she should delegate the weekly Sales meeting that she had always led to — of all people — the Head of Sales! She realized she had hired this person over a year ago but was still clinging to certain responsibilities that “she had always done,” and had never fully empowered him, for fear of giving up control. In the end, she admitted all she really needed was an email update. By letting go of this one task, she freed up 52 hours a year to focus on other high-priority strategic issues.

Challenge your assumptions. If feeling overwhelmed is an ongoing struggle, it is likely that you have assumptions that are keeping you stuck in unproductive behaviors. Kegan and Lahey refer to these as “Big Assumptions.” For Sue, it was the belief that “If something falls through the cracks, I’d fail and wouldn’t be able to recover from it.” In Ajay’s case, it was his belief that “If I’m not there to help others, I won’t be needed and people will question my value.” For Maria, her assumption was “If I lose control, others will mess up, and the company will fail.” While these big assumptions felt real to each leader, these limiting beliefs were not likely 100% true and kept them stuck in old patterns that significantly contributed to their sense of overwhelm. By identifying and debunking these beliefs over time, they were able to broaden their previously contracted view of the world, which in turn allowed them to reduce their overwhelm and provided them with a greater sense of agency.

While we may all feel overwhelmed from time to time in our demanding work and personal lives, employing the above strategies can help mitigate the frequency and extent to which we feel this way.

Read more on Stress management or related topics Personal productivity and Managing yourself

  • Rebecca Zucker is an executive coach and a founding partner at Next Step Partners, a leadership development firm. Her clients have included Amazon, Clorox, Morrison Foerster, Norwest Venture Partners, The James Irvine Foundation, and high-growth technology companies like DocuSign and Dropbox. You can follow her on Twitter: @rszucker

https://hbr.org/2019/10/how-to-deal-with-constantly-feeling-overwhelmed?utm_campaign=hbr&utm_medium=social&utm_source=linkedin