Insomniac Hedge Fund Guy

On Monday, Katy Huberty of Morgan Stanley cited channel checks and a customer intent survey as the basis for predicting the potential for iPhone sales to fall by as much as 2.9 percent over the next year, reaching a total for 2016 as low as 224 million in a “worst case scenario.” The idea of “Peak iPhone” generated clickbait headlines, but the real story is that channel checks have historically been extremely worthless at predicting Apple’s actual performance. Source: Channel-check analysts warning of Peak iPhone are priming Apple shares for monster buybacks

“in the United States at least the Fed and the forecasting community has been consistently far behind the curve in recognizing that the neutral real rates has fallen. If, as I suspect, Rachel and Smith are right there will be much less scope to raise rates in the industrial world over the next few years than the world’s central banks suppose.” Former Treasury Secretary Larry Sommers is usually thought to be the smartest guy in the room. I’d put more credence on this than Wall Street consensus or Fed member Stanley’s Fischer’s comments about rising Fed Funds rate to 3%. … Read more

Persistently low inflation has led investors to expect more of the same in coming years, but fear of superlow inflation or even deflation may be getting out of hand. Source: Beware an Inflation Scare – WSJ

Bloomberg Business delivers business and markets news, data, analysis, and video to the world, featuring stories from Businessweek and Bloomberg News. Source: Don’t Count on an Oil Rally If U.S. Crude Export Ban Is Lifted – Bloomberg Business My comment, it might not cause a rally but it might provide a floor.

Natural gas prices plunged to a 14-year low Monday, as an unusually warm winter saps demand and deals another blow to struggling energy companies. Source: Natural Gas Sinks to 14-Year Low – WSJ

Junk-Bond Selloff IntensifiesRout reaches a third consecutive trading day and shares of some asset managers tumble Source: Junk-Bond Selloff Intensifies – WSJ

A 200-year history shows that the real aberration looks like the 7.3 percent average experienced in the U.S. from 1970 to 2007. Source: Why Very Low Interest Rates May Stick Around – The New York Times

simple Source: Peter Lynch, 25 Years Later: It’s Not Just ‘Invest in What You Know’ – WSJ

Federal Reserve officials are likely to raise their benchmark short-term interest rate from near zero Wednesday, expecting to slowly ratchet it higher to above 3% in three years. Their big worry is they’ll end up right back at zero. Source: Fed Officials Worry Interest Rates Will Go Up, Only to Come Back Down – WSJ

Jeffrey Gundlach, the widely followed investor who runs DoubleLine Capital, warned Friday that crumbling credit markets could expose more fund debacles such as Third Avenue Management’s junk bond portfolio and the Federal Reserve should take note of deteriorating financial conditions. Source: Gundlach says ‘never just one cockroach’ in any kind of credit meltdown

I like this missive from JP MORGAN’s outstanding research department. “Meanwhile it would be easier to feel better about the SPX if its leadership wasn’t so thin – the “FANG” complex (FB/AMZN/NFLX/GOOG) continues to do a ton of heavy lifting (along w/stocks like MSFT, GE, and HD).  The SPX is up ~25 points in ’15 but AMZN and GOOG/GOOGL are contributing ~30 points to the index all by themselves (MSFT is adding 8 points, FB 6.8, GE 5.8, and HD 4.3).  Meanwhile, the violent daily market swings shouldn’t be considered a virtue and instead are a sign of the enormous influence non-fundamental factors continue to hold over trading.”

Yesterday was just weird.  U.S. stocks, government bonds and the dollar all tumbled Thursday, a rare occurrence that underlines markets’ vulnerability to reversals at a time of large bets on central-bank policy and concerns about uneven market liquidity.  The S&P 500 dropped an unremarkable 1.04% but the real action was elsewhere. Crowded Trades Collapse Dollar Collapse  The U.S. Dollar Index collapsed the most in one day since records were kept. From a blow out top to the day’s low was an astounding 3.48 points.  That’s an unheard of move. ECB’s Stimulus Moves Fall Short of Market Expectations, Hammering Stocks ‘I think … Read more

Apple’s iOS clinches 78.3% of U.S. mobile online shopping over Thanksgiving, 360% more than Android By Daniel Eran Dilger Friday, November 27, 2015, 06:08 pm PT (09:08 pm ET) Apple remained the dominant platform for holiday mobile shoppers as iPad and iPhone users accounted for 78.3 percent of mobile e-commerce orders over Thanksgiving Day. Buyers using any device using some form of Android contributed only 21.5 percent of online orders. Source: Apple’s iOS clinches 78.3% of U.S. mobile online shopping over Thanksgiving, 360% more than Android Another reason to believe that Apple is grossly undervalued based on the ecosystem it … Read more

Expectations are rising for the Fed to raise rates in its next meeting in December The US economy created a lot more jobs in October than economists had forecasted. This suggests that the US economy is getting stronger and, combined with upbeat comments made by the Fed after its October meeting, is causing more people to believe that there will be a rate rise in December. If that does happen, it will be the first US rate rise since 2006. Source: Fed decision: What happens when interest rates rise?

Dear future historians: Janet Yellen did not cause the late-2010s recession. If a Federal Reserve interest rate rise in December is followed in short order by an economic slowdown, the temptation will be to blame the central bank and its chair…. Source: US credit tightens ahead of Federal Reserve policy shift – FT.com

GOLDMAN: Stocks will go nowhere in 2016 Goldman Sachs is forecasting another lackluster year for the S&P 500.Year-to-date, the benchmark index has gained about 1.3%.”We forecast the S&P 500 index will tread water for a second consecutive year in 2016,” Goldman’s David Kostin wrote in the firm’s 2016 stock-market outlook on Tuesday. Source: Goldman Sachs 2016 stock market outlook – Business Insider

6 MLPs That Can Thrive Even if Oil Remains CheapBrian Watson’s OppenheimerFunds portfolios have weathered the energy storm better than most. Here are his picks.Email Print 1 Comments Order Reprints Facebook Twitter Google+smaller LargerBy AMEY STONENov. 24, 2015 6:10 a.m. ETBloomberg NewsPortfolio manager Brian Watson is a fairly humble guy. Sure, he runs some of the top performing mutual funds in his category, but he’s not bragging about it. Humility is called for: The fund is down double digits this year.Watson, head of research at OppenheimerFunds’ SteelPath division, manages funds that invest in MLPs, or master limited partnerships, which are … Read more

From Utah To China: Meet The $2.6 Billion Fund That Invests Like MissionariesLiyan Chen ,FORBES STAFF Charting the world’s largest companies and wealthiest people.FOLLOW ON FORBES (226)This story appears in the December Special 2015 issue of Forbes. SubscribeBlake Walker, Robert Gardiner and Eric Huefner, founders of Grandeur Peak.When your day job involves traversing the globe from city to city, it’s not surprising that geo-tagging selfies for Facebook FB +0.00% gets old fast. But for Robert Gardiner and the globe-trotting analysts of $2.6 billion small- and microcap asset manager Grandeur Peak Global Advisors, updating and sharing their 6,175-row spreadsheet of international companies … Read more

Some of the top financial experts warned us of recessions and crisis, while others shared their tips for finding yield. Source: 14 Predictions for 2016 From the Brightest Minds in Finance

Excellent reporting as usual by the NY Times.  Goes a long way to explaining the diverging economy of winners and losers. America’s HeartlandFeels a Chill FromCollapsing Commodity PricesIn China and other emerging markets, growth is waning and demand for the raw materialsthat drive the global economy has dried up. A thousand miles south of Granite City, Ill., a gritty steel town on the Mississippi River, West Texas oil rigs have shuddered to a halt. Seven hundred miles north, mines in the Iron Range of Minnesota have been stilled. The drilling rigs, with their deep underground pipes, once consumed much of the steel … Read more