1. Commentary on Wed. Rate Cut
Tom Lee Fundstrat
If the Fed does indeed cut rates at the FOMC on Wednesday, as widely expected, the bearishly inclined are warning that this could actually be bad for stocks. They note (correctly) that historically, stocks have fallen half the time immediately after the Fed makes its first cut of a cycle. However, Head of Data Science “Tireless” Ken Xuan and his team took a deeper look historical cycles and came to a different conclusion. Examining the last 11 Fed “first cuts,” Xuan found that five of them took place with a recessionary backdrop. The other six came during a non-recessionary, “no landing” scenario such as the one in which we currently find ourselves. The difference in historic post-cut win ratios between the two categories is significant and best illustrated by our Chart of the Week.
2. Gold Miners
Gold making new highs…leveraged junior gold miners 50day crossing above 200day to upside.
3. Defensive Consumer Staples ETF Trading at 25x P/E
Looks like a tech stock chart for last 12 months.
4. Defensive Sector YTD Utilities XLU +23% vs. XLK (tech) +17%
5. Sample- The Power of Dividends
Bespoke Investment Group
Altria has increased its dividend for 54 consecutive years, making it one of the longest-running Dividend Aristocrats.
https://www.bespokepremium.com/interactive/posts/think-big-blog/altria-group-mo
6. Starlink 61% of Global Satellites
Perplexity AI
7. Foreign Direct Investments in China Go Negative
WSJ By Yoko Kubota and Liza Lin
https://www.wsj.com/world/china/western-firms-that-flocked-to-china-are-now-pulling-back-ea2f3c27
8. India 50% Internet Connectivity
9. Loan to Value of American Mortgages….Low Leverage
If people are already in a home they have a lot of equity. That’s proven in this chart which shows that the Loan-to-Value ratio for mortgages is 48%.
That’s down from 70% just over 10 years.
Source: Mike Simonsen
10. Know Thy Time: Peter Drucker’s Strategy to Become More Effective -Darius Foroux
The reason I research productivity is simple. I think that a productive life equals happy life.
Also, if you’re more productive than average people, you’ll advance faster in your career. You learn more. You do more. And eventually are rewarded more.
Now, productivity is a very generic term. Personally, I prefer to use the word effectiveness.
Because productivity doesn’t necessarily mean that you get the right things done. It just means you get a lot of stuff done. But that’s not what matters.
Effectiveness, however, refers to getting the right things done. It’s basically a polite word for “getting shit done.”
And if you want to do your job well, earn money, live a meaningful life, learn skills, you HAVE to get shit done.
Results matter the most.
You might work for 50 hours a week, but if you don’t experience any growth personally, emotionally, financially, you’re not effective.
People often ask me, “where do I begin?” To answer that question, I want to share one exercise that I use with companies and people who hire me to improve their effectiveness.
It’s an exercise that I picked up from Peter Drucker’s The Effective Executive. To me, Drucker is the first and best thinker when it comes to effectiveness for knowledge workers.
Much of the books, articles, productivity tools, and productivity apps you see these days are all in a way influenced by Drucker.
For instance, the term “deep work” (coined by Cal Newport) is currently very popular. But if you read The Effective Executive, which is written in 1967, Drucker talks about the same concept.
He says that if you want to get things done, you have to allocate large chunks of (uninterrupted) time to your work. Drucker says:
“To be effective, every knowledge worker, and especially every executive, needs to be able to dispose of time in fairly large chunks. To have small dribs and drabs of time at his disposal will not be sufficient even if the total is an impressive number of hours.”
As you can see, my appreciation for Drucker goes deep. That’s why I read much of his work, and also apply it in my life and work.
What you will find next is a simple exercise from The Effective Executive (which I modified slightly to make it easier) that you can apply to become more effective.
Step 1: Know thy time
I often hear people saying: “I don’t know what’s wrong with me. I keep procrastinating.”
My question is: “Do you know thy time?”
If you don’t measure your time, it’s tough to stop procrastination or improve your productivity. Because if you want to manage your time better, you have to know where it goes first.
Your memory is not sufficient. If I asked you what you were doing exactly one week at this time, would you have an answer? There you go.
How do you know your time? Keep an activity log.
Before I even have a real session with clients, I often ask them to keep an activity log for two weeks. An activity log is exactly what you imagine — an hour by hour record of what you’re doing throughout the day.
The specific method you use for your activity log doesn’t matter. The only thing that matters is that you want to keep a record for at least two weeks. Preferably, you want a whole month of recorded activities.
I just keep a pen and a notepad on my desk and every hour I write down the time and what I’ve done during the past hour. It’s important to keep the notebook visible, so you don’t forget.
Step 2: Identify the non-productive work
This step is actually very simple. I just have one question for you:
“Go through all the recurring activities in your log one by one. What would happen if you would stop doing them?”
If the answer is: “All hell breaks loose.” Don’t change anything.
But if your answer is: “Nothing would happen.” You’ve hit gold.
We all do activities that have ZERO return. I call those activities time-wasters.
Step 3: Eliminate the time-wasters
Boom. That’s it. Know where your time goes. Identify the critical tasks from the trivial tasks in your life. And cut the trivial, time-wasting, tasks.
“That simple?” Yes.
If you want to be a super-effective person, you regularly keep a log. You don’t have to keep a log for 365 days a year.
Instead, do two stretches of two-three weeks a year. That’s enough to keep track of your time and identify new time-wasters.
Also, the additional benefit of such a simple exercise is that it forces you to think about your daily routine.
Often, we start time-wasting activities, and they become habits. And if you don’t become aware of the pointless behavior, it’s difficult to break those bad habits.
I’ve found this exercise to be one of the most powerful things in productivity.
Start now. Your activity log probably looks something like this:
- (insert time) — Read Darius Foroux’s article about keeping a time-log and started my own time-log.
- (insert time) — Turned off my phone and got back to (whatever you were working on).
- (insert time) — Browsed the news, Facebook, Instagram. And watched YouTube videos. (Be honest with yourself. Shit happens).
- (insert time) — responded to emails.
Great. I’m happy to see that you started. Now keep going for another two weeks.
Grade inflation at American universities is out of control. The statistics speak for themselves. In 1950, the average GPA at Harvard was estimated at 2.6 out of 4. By 2003, it had risen to 3.4. Today, it stands at 3.8.
The more elite the college, the more lenient the standards. At Yale, for example, 80% of grades awarded in 2023 were As or A minuses. But the problem is also prevalent at less selective colleges. Across all four-year colleges in the U.S., the most commonly awarded grade is now an A.
Some professors and departments, especially in STEM disciplines, have managed to uphold more stringent criteria. A few advanced courses attract such a self-selecting cohort of students that virtually all of them deserve recognition for genuinely excellent work. But for the most part, the grading scheme at many institutions has effectively become useless. An A has stopped being a mark of special academic achievement.
If everyone outside hard-core engineering, math or pre-med courses can easily get an A, the whole system loses meaning. It fails to make distinctions between different levels of achievement or to motivate students to work hard on their academic pursuits. All the while, it allows students to pretend—to themselves and to others—that they are performing exceptionally well. Worse, this system creates perverse incentives. To name but one, it actively punishes those who take risks by enrolling in truly challenging courses.
All of this contributes to the strikingly poor record of American colleges in actually educating their students. As Richard Arum and Josipa Roksa showed in their 2011 book “Academically Adrift,” the time that the average full-time college student spent studying dropped by half in the five decades after 1960, falling to about a dozen hours a week. A clear majority of college students “showed no significant progress on tests of critical thinking, complex reasoning and writing,” with about half failing to make any improvements at all in their first two years of higher education.
In one of the oldest jokes about the Soviet Union, a worker says “We pretend to work, and they pretend to pay us.” To an uncomfortable degree, American universities now work in a similar fashion: Students pretend to do their work, and academics pretend to grade them. It’s high time for a radical reboot of a broken system.