Topley’s Top Ten – November 7, 2019

Author

Matt Topley
November 07, 2019

1.100 Year Bond +20%

The Bubble Is Deflating for 100-YearBonds

That valuation still seems bubblicious; a 1% yield on a bond isanalogous to a stock with a price/earnings multiple of 100. With a high P/Estock, you’re betting on big growth down the road. A bond returns only facevalue at maturity, assuming it’s paid off as promised.

The drop in Austria’s century bond’s price to 168 from 210 stillqualifies as a bona fide bear-market decline of 20%. Brigden’s price target isfor a further fall, to 143.50. Such price swings typically are associated withtech stocks, not stodgy government bonds.

None of the negative bond yields (still totaling $12.8 trillion)would be possible without European Central Bank policies, Brigden points out.“The ECB brought European yields down by two policies; quantitative easing (apseudo fiscal policy) and negative rates (punishing thrift to boost assetprices).” Those policies may be reaching their limits, however.

Not only is the ECB close to running out of bonds to buy, in thecase of German and Dutch debt, he writes, but other European monetaryauthorities are beginning to question the usefulness of negative policyrates, notably Sweden’s Riksbank. Anarticle published earlier this year bythe Federal Reserve Bank of San Francisco also questioned the effectiveness ofthe Bank of Japan’s negative interest rates.

Write to Randall W. Forsyth at [email protected]

2.Quants vs. Market

3.Aramco 52 Years Worth of Gas Reserves.

Life of proved reserves:

Source:@WSJ; Read full article

4.Bear Market Perspective.

Wells Fargo

5.Seasonally Strong Stock Market Season Kicks In.

Nasdaq Dorsey Wright  www.dorseywright.com

6.European Companies Deriving Bulk of Revenue from Outside Region.

7.Two U.S. Equity Groups That Have Not Seen New Highs.

Transports have not confirmed Dow new highs.

Small Cap stocks below highs

8..Nearly half of SF families are financially insecure, despite high median income

By Madeline Wells, SFGATE

 Published 10:40 am PST, Wednesday, November 6, 2019

Despite themedian household income in San Francisco County being $112,376, more than halfof all San Francisco families do not have at least $2,000 in savings, accordingto a report releasedby the nonprofit Urban Institute Wednesday.

That means47% are financially insecure, leaving them at higher risk of eviction andunpaid bills. Financially insecure households are 14 times more likely to beevicted — which can lead to homelessness — and three times more likely to missa housing or utility payment, according to the Urban Institute.

Basically,the cost of living in San Francisco is so high that even making $37,099 morethan the statewide average income (according to the 2018 census)isn’t enough to keep you from struggling.

Theorganization’s estimates were based on 2014 census data and put into apredictive model for 10 different U.S. cities, including Los Angeles, New YorkCity and Chicago. San Francisco was the only Bay Area city included in thestudy. To compare, 61% of both Los Angeles and New York families were found tobe financially insecure, despite the fact that the median income of both citiesis substantially lower than that of San Francisco’s.

However, SanFrancisco fared better with a different measure of financial health: creditscores. Only 13% of San Franciscans have subprime credit scores, which signifythe estimated risk of delinquency on a debt or line of credit. This is belowthe national average of 28%.

MadelineWells is an SFGATE digital reporter. Email: [email protected] |Twitter: @madwells22

9. Soaring Homelessness Forces San Fran To Issue Record Housing Debt

PreliminaryPIT estimates show in 2019 a 43% jump in the homeless population in AlamedaCounties, 31% in Santa Clara, and 17% in San Francisco from 2017 to 2019.

Totalhomeless populations in the Bay Area will likely increase through the early2020s as wealth inequality expands. If the bill is approved, the build time forthese new structures could take several years. 

UnderProposition A, funds will be allocated to these five areas (list providedby Bloomberg): 

  • $220 million for extremely low- and low-income people

  • $150 million to repair and rebuild public housing developments

  • $150 million to acquire and construct housing for seniors

  • $60 million to acquire and rehabilitate affordable rental housingto prevent the loss of such housing and to assist middle-income city residentsand workers to secure permanent housing

  • $20 million to support affordable housing for educators andemployees of the San Francisco Unified School District and City College of SanFrancisco

Zero Hedge

10.8 Life Lessons I’ve Learned From Traveling the World With My Family

By Michael Blankenship | November 1,2019 | 0 

My wife, 2-year-olddaughter and I have been traveling the world for over a year now. When mostpeople find this out, they look surprised and try to figure out which questionto ask first: Why? Are you rich? How? With a little girl?

Sometimes, we opt for theeasy answer: vacation. The alternative usually leads to a long conversationabout why we’ve done what we’ve done, and trying to convince them that we’renot completely nuts. 

The fact is, we did itbecause… well, we wanted to! The truth isn’t a whole lot more complicated thanthat.

We’ve been to 11 differentcountries in 13 months, and my remote work is what pays the bills. Alongthe way, I’ve learned a lot about fear, fortune, discipline, myself and myinner fire. Here are eight lessons, in particular, that stand out:

1. It’s only ever as scary as youmake it. 

Before our one-year stint,my wife and I had never traveled further than a five-day cruise to Mexico. Forthe most part, we stayed within our hometown in Oregon, venturing out to nearbystates for a vacation every few months. 

It wasn’t until we took anunexpected trip to Australia that we discovered our passion for traveling anddesperately wanted to do more of it. But, of course, selling our house?Traveling the world? Terrifying. 

Until we did it. Then itwasn’t scary at all. The only fear I’ve experienced related to traveling overthe last year was right before we actually left. Once we arrived in Italy—ourfirst destination—I was caught up in the thrill of conquering my fear and doingsomething I’d never done before. Fear took a back seat to my inner fireand excitement. 

“We suffer more inimagination than reality.”

Seneca

2. One day of misery is worth anentire month of thrilling experience. 

People often ask us (witha shocked expression on their face), “How do you travel with a kid?”

And part of me wants tosay, “Umm. Well, we get on a plane. And when we do, we make sure that our childis with us.” Ha!

But I get what they’resaying. Traveling with a kid is difficult—no question about it. But isn’t oneday (or rather, one eight-hour flight) of misery worth an entire month or yearof thrilling experience? We think so. 

3. Pain is a great motivator tochange your life. 

When we sold our house andleft for our adventure, it wasn’t entirely because we justwanted to. We didn’t wake up and think, “Hey! Wanna travel?”

No. The primary motivator was intense frustrationwith our hometown, summer smoke from Oregon fires and a discontent with seeingthe same dang thing every day. We were sick of it. And that frustration droveus to make the best decision of our lives (so far!). If you harness your pain,it can be a great motivator to finally change your life for thebetter.  

4. You’re more capable than yougive yourself credit for. 

I know. Selling our house,traveling the world and living in a different Airbnb every month, working forclients in U.S. time zones, raising our daughter at the same time… It all seemsa little risky, right? 

What if something goeswrong while we’re in another country? What if little Andie (my daughter) getssick? What if an Airbnb host bails on us? What if no one speaks English? Whatif, what if, what if…

In Italy, an Airbnb hosttried to charge us $500 for damage that we didn’t cause. In Croatia, ourdaughter got a terrible virus. And on a rocky boat ride to a Greek island,Andie started a vomit chain reaction (ya know—the smell). 

But we figured it out. Welived through all of it. And we look back at those moments now and laugh. Weare more capable than we originally thought we would be. When you have tofigure it out, you just do. 

Courtesy of Michael Blankenship

5. One powerful decisionpermeates every part of your life. 

One of the most amazingthings about our decision to travel is the impact it has had on the rest of ourlives. I have a much better relationship with my wife and my daughter, wealways have something to look forward to—and three months into traveling, I quitmy job and went full time as a freelancer. Suddenly, thatdecision was a lot less scary, too!

When you make one powerfuldecision, there’s no stopping it; that decision will impact every other part ofyour life and set off a chain reaction that helps you make other importantdecisions. 

6. In the end, we’re all thesame. 

All humans are thesame. We have so much in common.

I’ve realized this moreand more as we’ve traveled from country to country. Sure, there’s differentcultures and different ways of communicating, but at the end of the day, we’reall just people who are trying to find a little bit of happiness. 

There’s somethingcomforting about that, don’t you think? 

7. Teamwork makes the dreamwork. 

There is an absolute 0%chance that I would be able to do all of this without my wife. She is theplanner, the budgeter and the motivator.

Without her, I wouldn’t beglobetrotting and I wouldn’t be living the life of my dreams. There’s noreason for you to do it alone, either (whatever it is). Find apartner who complements you, team up, and do something awesome. 

8. Persistent change keeps youpresent. 

When you’re traveling theworld, moving to a new country every month, there’s not much time to settleinto a routine. Every month, I have to find a new place to work, we have tohunt down a grocery store and figure out public transportation. 

That might seemoverwhelming, but it’s actually a lot of fun—it’s one of our favorite things todo when we get to a new country. Because when you’re busy figuring things outand solving problems, you feel alive, your life has meaning. And bouncing fromplace to place leaves no time for being sedentary orunsatisfied.