1. Software ETF New Highs
2. Micro Cap Stock ETF Still 21% Below Highs
3. Bonds and Gold Performance During Stock Crashes
Jack Ablin Cresset
4. Warren Buffett Deepens Association with Japan’s Capital Markets
From Dave Lutz at Jones Trading
JAPAN BUYERS– Warren Buffett’s Berkshire Hathaway has raised 281.8 billion yen ($1.9 billion) in a yen-denominated bond offer, a move analysts say lays the ground for the U.S investment company to increase its exposure to Japanese assets. The deal was the largest bond sale in the Japanese currency for the firm in five years, a term sheet reviewed by Reuters on Thursday showed. The yen, or Samurai, bond issue signals Buffett’s deepening association with Japan’s capital markets after its equity stake buys in the nation’s top five trading houses over the past four years.
Foreign investors increased their purchases of Japanese stocks in the week ended Oct. 5, as the yen weakened following Prime Minister Shigeru Ishiba’s dovish remarks, boosting appetite for local exporters. Foreigners acquired Japanese stocks worth 919.3 billion yen ($6.16 billion) on a net basis during the week, according to Finance Ministry data, in their largest weekly net purchase since April 13
5. Trump Media +50% in 5 Days
6. STAX -Schwab Activity Index-New (2019) Sentiment Index
Bespoke-Traders Much Less Enthusiastic Now Versus 2021
This week we got an update from the Schwab Trading Activity Index, also called the STAX. We initially covered this data in Tuesday’s Closer for subscribers, but we also wanted to highlight it here on Think BIG. Whereas most investor sentiment readings like the AAII survey directly ask investors how they feel about the market, indicators like the STAX are derived by measuring what retail investors are actually doing in their accounts. In September, Schwab’s Trading Activity Index fell to 47.1, which is the lowest reading since January. That drop occurred even though the stock market continued to rally to new all-time highs.
The STAX data dates back to 2019, and as shown below, the index surged in late 2020 through late 2021 during the first post-COVID bull market when Americans were flush with stimulus cash and were actively bidding up pretty much everything that traded! At the time, the STAX index saw record highs with readings above 75 in June and November 2021. November 2021 was ultimately the peak for growth stocks before the bear market of 2022.
Notably, there’s a big difference between the STAX reading now versus 2021. The stock market is currently up 60%+ off the late 2022 lows and has registered 44 all-time highs already this year. Similarly, the market was also making a new high after a new high back in 2021. During this year’s rally, though, the STAX has remained quite subdued compared to going gangbusters in 2021. This tells us that there’s less complacency, enthusiasm, and overall interest in the market right now versus 2021 levels, which is good if you’re a long-term bull.
7. One of Druckenmiller’s Buys was KMI Kinder Morgan…..Making a Run at 2014 Highs
8. Foreign Central Banks Buying Up 30 Y Treasury Auction
Zerohedge
https://www.zerohedge.com/markets/stunning-foreign-demand-strongest-30-year-auction-record
9. Where are Populations Growing?
https://www.visualcapitalist.com/mapped-top-10-countries-driving-future-population-growth
10. Everything costs -Seth’s Blog
But not all costs are the same.
There are three kinds of costs that people get confused about, but understanding them, really understanding them–in your bones–unlocks opportunity.
Opportunity cost: If you eat the cupcakes, you can’t also eat the brownies. Every time we choose to do something, we’re choosing not to do something else.
Sunk costs: If you’ve invested time or money in something (a law degree, a piece of real estate, a bag of chips) that money is gone. All you have left is what you bought, and that is a gift… a gift from your former self. You don’t have to accept the gift if it’s no longer useful to you. Using a gift still has real opportunity cost, and if it’s keeping you from doing something better, walk away.
Marginal cost: How much extra does this decision cost? For a subscriber, the marginal cost of watching one more show on Netflix is zero. The service costs the same regardless of how many shows you watch. On the other hand, the marginal cost of a tuna sandwich is equal to what it costs to replace the ingredients. It makes sense to prefer things with a lower marginal cost if everything else is similar.
I’ve never encountered a person who was fully rational in making decisions on any of these three sorts of costs. That’s okay. But let’s do it on purpose.