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’The Best of What They Said and I Read’ week ending 11/19/17

Short excerpts from articles I found interesting.

I may not agree with the author and the following material is not intended as investment advice.

The Wall Street Journal – November 18 – 19, 2017 – Bitcoin Roars Back To Nearly $8,000 – Steven Russolillo

  • “The price of bitcoin surged Friday to a record near $8,000, erasing the sharp pullback last weekend in a stretch that is volatile even by the digital currency’s standards.  After slumping more than 25% over four days, bitcoin roared back this week, jumping to its highest level of $7,998 on Friday morning in Asia before retreating slightly, according to research site CoinDesk.  The digital currency has risen more than 700% this year ahead of a hotly anticipated launch of bitcoin futures, which could draw more institutional investors into the small yet growing market.”
  • “Price swings are common in the cryptocurrency markets.  Bitcoin has had five separate declines this year of more than 20% off recent highs.  Still, the latest action stands out for what some market watchers described as unusual activity involving bitcoin and an alternative version of the digital currency called Bitcoin Cash, which has quickly grown in popularity…”

 

Barron’s – November 18, 2017 – The Market’s Journey:  Don’t Stop Believing – by Ben Levisohn

  • “If the market were a watch, we would say it could take a licking and keep on ticking. If it were a prizefighter, we’d say it knew how to ride a punch. But it’s a market, and that simply means investors are willing to take chances again and again and buy the dips.”
  • “You wouldn’t know it by looking at the major indexes, which finished mixed on the week. The Dow Jones Industrial Average dropped 63.97 points, or 0.3%, to 23,358.24 last week, while the Standard & Poor’s 500 index dipped 0.1% to 2578.85. The Nasdaq Composite rose 0.5% to 6782.79.  The final tally, however, doesn’t do justice to the beatings the market took at the open early in the week. The Dow traded down nearly 80 points on Monday, 170 points on Tuesday, and 170 points on Wednesday, but each time the blue-chip benchmark finished off its lows. That was followed by the Dow’s 187-point rally on Thursday, as everyone bought the dips.”
  • “…The S&P 500 has now gone 62 weeks without a drop of 2% or more, the longest such streak since 1965. And it isn’t as if there haven’t been reasons to sell, from the narrowing difference between short-term and longer-term Treasuries—known as a flattening yield curve—to tax-reform hiccups in Washington and a selloff in high-yield bonds that briefly caused investors to wonder if the credit market was acting as an early warning signal.”

 

The Kiplinger Letter – November 17, 2017

  • “…Here’s a switch for U.S. manufacturing:  Production is returning to American shops after a long period in which firms offshored jobs and assembly lines to cheaper areas such as China.  What’s driving the new “reshoring” trend?  Advanced manufacturing technologies that make it more cost-effective or more convenient to operate stateside than in far-flung places overseas.  Automation is boosting U.S. productivity, allowing firms to do more with fewer employees.  That cuts labor costs, despite the higher pay that American workers earn. One maker of trash bins that used to employ 80 Chinese factory workers shifted production to a highly automated U.S. factory.  Now it needs fewer than 10 folks for the same output.”
  • “Production quality is on the rise. New robots, automated laser cutting machines, 3-D printers and the like yield more-uniform, reliable components and better assembly than what many manufacturers could count on in distant, low-cost Asian factories.  Another advantage for U.S. manufacturers:  They can retool faster, ramping production levels up or down on short notice if a particular product is selling better or worse than expected. That leaves companies at less risk of coming up short or being overstocked. Chinese factories, by contrast, tend to require long lead times and typically produce items only in bulk quantities.”

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