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The Best of What They Read and I Said Week Ending 4/7/2019

Short excerpts from articles I found interesting.  I may not agree with the author and the following material is not intended as investment advice

U.S. Global Investors - Investor Alert – April 5, 2019 – Frank Holmes 

  • “…The major market indices finished up this week. The Dow Jones Industrial Average gained 1.91 percent. The S&P 500 Stock Index rose 2.04, while the Nasdaq Composite climbed 2.71 percent. The Russell 2000 small capitalization index gained 2.77 percent this week.”

  • “…Oil in New York is set for the longest weekly winning streak since November 2017, as crises from Venezuela to Libya threatened supplies and optimism over the U.S.-China trade talks boosted the outlook for demand, writes Bloomberg. WTI was up 3.3 percent this week and is poised for a fifth weekly advance. On Monday Saudi Arabia’s giant oil company, Aramco, finally opened its books and revealed that it generated over $111 billion in net income in 2018. This makes it likely the world’s most profitable company.”

  • “…U.S.-China trade talks remain ongoing and tariffs remain delayed in implementation; a collapse of the former or the commencement of the latter remain a collective threat until resolution one way or the other amid the dispute. This week there were promising signs—a new consensus, if you will—but it ain’t over ‘till it’s over.”

  • “…On Monday, bitcoin advanced to the highest level of 2019, writes Bloomberg, rising as much as 1.6 percent to $4,135.60. Then on Tuesday morning, the digital currency surged even higher, rising as much as 20 percent and trading above $5,000 for the first time since last November. According to MarketWatch, the market value of all cryptocurrencies rose more than $15 billion in less than 90 minutes on Tuesday.”

Barron’s – April 5, 2019 – This Bull Market Has No Expiration Date – Ben Levison and Nicholas Jasinski

  •  “…Dubravko Lakos-Bujas, J.P. Morgan:  In previous cycles, central banks steadily tightened monetary conditions through a recovery, then eased once a recession appeared. For the past decade, though, central banks around the world have kept policy accommodative. They’ve been able to do so because inflation has remained under control despite low interest rates, Lakos-Bujas says.   “The fact that we’re not seeing really significant inflation pressure—it remains positive but tame—suggests that there’s no reason for central-bank policy to rush,” he says.  

  • “But they’ve done more than just keep rates low. Central banks have put their balance sheets to work like never before, with large-scale asset purchases injecting liquidity into economies around the world…“This is not a normal cycle just left to itself to run. It is continually fiddled with by these central-bank injections,” he says.”

  • “…Another mini-cycle ended in the fourth quarter of 2018, when the Fed pivoted to a dovish stance and China began fiscal stimulus. That brings us to the start of 2019, when a fourth cycle might have begun. “We have these little mini-cycles that are continuously occurring, and they seem to coincide with central-bank policy,” Lakos-Bujas says.  He sees the S&P 500 going to 3000 this year, as investors steadily become willing to take on more risk and overhangs like the U.S.-China trade dispute are resolved.”

The Kiplinger Letter – April 5, 2019 – And finally, here’s what Joe is interested in this morning

  •  “…The House will soon allow banks to service the legal marijuana industry after heavy lobbying by both business and local governments, pressuring the Senate. Similar proposals haven’t fared well in the Senate, but the odds are better this year. Although most states allow at least medical marijuana, pot is still illegal nationally. Banks and credit unions can be federally prosecuted for working with the industry. Backers see the bill as the first step toward federal decriminalization of pot.”

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