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Warm-Up
- Grinch Ending .... No Santa Rally
- CTP Results are IN! Close race
- Cocktails -> Cancerous now
- New rules for medical bill deadbeats

- Markets
- Poor end of year - hard hit by Grinch - killed Santa Rally
- Gym parking Lots - Resolutions for January
- Yields starting to becom a problem
- CME Fed Funds Futures --> No CUT MAN!

 

Market Update
- December

Market Update

Sector Update

January Markets
- As expected, the start of the year is typically a time when people make resolutions they hope to keep.
- In the finance world, we often hear about returning to discipline, cutting losers, adding to winners, and adhering to all the fundamental rules.
- Additionally, at this time of year, investors may consider becoming more aggressive, less aggressive, more diversified, or investing in last year's winning stocks.
- These thoughts and actions contribute to market volatility, which usually fades away within a couple of months when resolutions are forgotten
---- Much like how the parking lots at local gyms are packed every January, but plenty of spots open up by March.

Big Issue
- The big issue we need to focus on now is the continuing increase in rates as the 10-year Treasury yield has now breached a key resistance level of 4.6%, which is significant.
- There are several reasons for this move, but the simple facts are that the economy is still growing and prices are on the rise.

ISM Report - Not Helping (From Briefing.com)
- The ISM Services PMI increased to 54.1% in December (Briefing.com consensus 53.0%) from 52.1% in November. The dividing line between expansion and contraction is 50.0%, so the December reading reflects services sector activity accelerating from November.
- The key takeaway from the report is that it was a double-whammy for rate cut expectations in that the expansion in services sector activity accelerated while the prices index picked up noticeably, printing its first reading above 60.0% since January 2024.

• The Business Activity/Production Index increased to 58.2% from 53.7%.
• The New Orders Index bumped up to 54.2% from 53.7%.
• The Employment Index dipped to 51.4% from 51.5%.
• The Prices Index jumped to 64.4% from 58.2%.
• The Supplier Deliveries Index rose to 52.5% from 49.5%.
• The Backlog of Orders Index fell to 44.3% from 47.1%.

No Cuts for A While
- With prices on the rise and the economy in good shape...

CME Fed Funds

Nat Gas!
- Natural gas futures prices surged last Monday, hitting a new 52-week high following reports of a colder-than-usual temperature outlook for January.
- Natural gas February futures rose around 15% during the session after an updated outlook by The Weather Co. and Atmospheric G2 released Sunday showed that the temperature forecast for next month is expected to be colder than average in the East, specifically from Florida to Maine as well as certain parts of the Great Lakes.
- POLAR VORTEX?
- Already prices are fading....

Booze Bummer
- The U.S. surgeon general issued a new advisory warning Friday about the link between alcohol consumption and increased cancer risk, and pushed for policy changes to help reduce the number of alcohol-related cancers.
- U.S. Surgeon General Dr. Vivek Murthy said there is a "well-established" link between drinking alcohol and at least seven types of cancer, including breast, colorectum, esophagus and liver. For cancers including breast, mouth and throat cancers, increased risk may start around one or fewer drinks per day, according to his office.
- As part of the advisory, the surgeon general called for policy changes that could help reduce alcohol-related cancer. He pushed for alcohol labels to be more visible and include a warning about the increased risk of cancer, to reassess recommended limits for alcohol consumption based on the latest research and expand education to increase general awareness that alcohol consumption increases cancer risk.

Madoff $$$
- The 10th and final distribution from a fund for victims of the late Ponzi scheme king Bernie Madoff began Monday, the Department of Justice said.
- The last disbursement, of more than $131 million, is being sent to more than 23,000 victims worldwide. When it is completed, more than $4.3 billion will have been distributed by the fund to more than 40,000 victims in nearly 130 countries
- The largest portion of the fund for Madoff's victims, about $2.2 billion, came from a civil forfeiture recovery from the estate of Jeffry Picower, a now-dead Madoff investor, the DOJ said.
- Another $1.7 billion came from JPMorgan Chase as part of a deferred prosecution agreement with the DOJ in January 2014. JPMorgan Chase and its predecessor institutions had served as the primary bank through which Madoff operated his scheme, the DOJ has previously said.

Weird Reports
- Both General Motors and Ford Motor on Friday reported their best annual U.S. new vehicle sales since 2019, prior to impacts from the coronavirus pandemic and yearslong supply chain problems.
- GM reported 2024 sales of more than 2.7 million vehicles, up 4.3% from a year earlier. The automaker sold 2.9 million units in 2019.

Meanwhile
- Tesla bombs
- Tesla posted its fourth-quarter vehicle production and deliveries report on TK. Here are the key numbers:
----Total deliveries Q4 2024: 495,570
---- Total production Q4 2024: 459,445
-----Total annual deliveries 2024: 1,789,226
------Total annual production 2024: 1,773,443
- Results for the quarter represented the first annual drop in delivery numbers for Tesla, a decline from 484,507 in the fourth quarter of 2023. For the full year, deliveries fell from 1.81 million in 2023.
- Analysts had expected Tesla to report deliveries in the quarter of 504,770
- Stock dropped on the news....
--- Remember when ELON first bought Twitter and shares of Tesla tanked as concern that he was going to lose focus on the car company in favor of Twitter?
--- Could the same thing be happening now?

More Odd Car News
- Short seller Hindenburg Research on Thursday accused Carvana of a running an “accounting grift for the ages” in a bombshell report — sending shares of the used-car retailer tumbling.
- Its report — titled “Carvana: A Father-Son Accounting Grift for the Ages” — accused the Tempe, Arizona-based company of insider trading and accounting manipulation.
- “Our research uncovered $800 million in loan sales to a suspected undisclosed related party, along with details on how accounting manipulation and lax underwriting have fueled temporary reported income growth — all while insiders cash out billions in stock,” the short seller alleged.

Banks - Fighting Back
- The biggest banks are planning to sue the Federal Reserve over the annual bank stress tests
- Then, the Federal Reserve announced in a statement that it is looking to make changes to the bank stress tests and will be seeking public comment on what it calls "significant changes to improve the transparency of its bank stress tests and to reduce the volatility of resulting capital buffer requirements."
- The Fed said it made the determination to change the tests because of "the evolving legal landscape," pointing to changes in administrative laws in recent years. It didn't outline any specific changes to the framework of the annual stress tests.
- So the banks are making the rules?

Medical Bills and Reporting
- Today, the Consumer Financial Protection Bureau (CFPB) finalized a rule that will remove an estimated $49 billion in medical bills from the credit reports of about 15 million Americans.
- The CFPB’s action will ban the inclusion of medical bills on credit reports used by lenders and prohibit lenders from using medical information in their lending decisions. The rule will increase privacy protections and prevent debt collectors from using the credit reporting system to coerce people to pay bills they don’t owe.
- So, good news?

Still at it...
- Shares of Chinese tech heavyweight Tencent Holdings tumbled 5.3% in Hong Kong after the company was added to a list of "Chinese military companies" by the U.S. Department of Defense.
- Other Chinese companies added to the list included battery maker CATL, which is part of the supply chain for automakers such as Ford and Tesla.

Presidential Stuff

What????
- President-elect Trump at press conference says he is not ruling out using economic or military force to take control of Greenland or The Panama Canal
-- OH, and we are going to change the name of the Gulf of Mexico to the Gulf of America (maybe Change the Pacific Ocean to West American?)
- Indiana - change to Cowboyana?
--- In fact - almost every state is named for an Indian word or non-American reason...
--- See-> https://www.bia.gov/as-ia/opa/online-press-release/origin-names-us-states

A little trivia with the inauguration just a few days away at this point...
- Historical question: What was and who gave the shortest and longest Inaugural address?

Shortest  - George Washington's second inaugural address, delivered in 1793, is the shortest inaugural address in U.S. history, consisting of only 135 words

Longest - William Henry Harrison's 1841 inaugural address was the longest, consisting of 8,455 words.
---- Harrison died a month after his inauguration from pneumonia, which was likely caused by exposure to bad weather on Inauguration Day.

Biden Giving More Away
- President Joe Biden on Sunday signed the Social Security Fairness Act, bipartisan legislation that clears the way for teachers, firefighters, policeman and other public sector workers who also receive pension income to receive increases in their Social Security benefits.
- The benefit boost comes as the new law repeals two provisions — the Windfall Elimination Provision, or WEP, and the Government Pension Offset, or GPO — that have been in place for more than four decades.
- The WEP reduces Social Security benefits for individuals who receive pension or disability benefits from employment where Social Security payroll taxes were not withheld. As of December 2023, that provision affected about 2 million Social Security beneficiaries.

Melania
- Amazon Prime Video has exclusively licensed an upcoming documentary film for both theatrical and streaming release that will give viewers an unprecedented, behind-the-scenes look at First Lady Melania Trump," an Amazon spokesperson said Sunday.
- "Filming began in December 2024, with an anticipated release in the second half of 2025. Prime Video will be sharing more details on the project as filming progresses and release plans are finalized. We are excited to share this truly unique story with our millions of customers around the world," the spokesperson said.

Hack
- Chinese state-sponsored hackers broke into the U.S. Treasury Department earlier this month and stole documents from its workstations, according to a letter to lawmakers that was provided to Reuters on Monday.
- The hackers compromised a third-party cybersecurity service provider and were able to access unclassified documents, the letter said, calling it a "major incident."
- According to the letter, hackers "gained access to a key used by the vendor to secure a cloud-based service used to remotely provide technical support for Treasury Departmental Offices end users. With access to the stolen key, the threat actor was able override the service's security, remotely access certain Treasury DO user workstations, and access certain unclassified documents maintained by those users."
- Is this still part of that SolarWinds hack from a couple yeas back?

 

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