Category Archives: Thematic Signals

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Thematic Signals highlights confirming data points and items to watch for our list of investing themes. Whether it’s a news item, video clip, or company commentary, we’ve included this full list of items literally “ripped from the headlines.”

First disappointing May auto sales, now Jamie Dimon sounds the alarm on auto loans 

First disappointing May auto sales, now Jamie Dimon sounds the alarm on auto loans 

While some see a booming auto market, there are reasons to be concerned as subprime loan volumes mount. Yes, those two dirty words are once again back in vogue, kicking up memories of the housing crisis and giving rise to thought the automotive market could be over inflated at best and at worst preparing for a pop. Following May sales declines at  Ford, GM, Volkswagen of America, Honda, Toyota and Nissan, Dimon’s comments are likely to question the vector and velocity of the domestic automotive market in the coming quarters.

 

Auto-loan balances surpassed $1 trillion in the first quarter, a record, growing 11% from the year-earlier period, according to credit reporting firm Experian. That is fueled by the growth in car sales in recent years as well as loosening underwriting standards that also have made it easier for subprime borrowers to get financing.

The volume of car loans held by subprime consumers increased by 11%, outpacing the 9% increase for prime customers, according to Experian.

“Auto is clearly a little stretched, in my opinion,” the JPMorgan Chase CEO said Thursday morning, speaking at the AllianceBernstein Strategic Decisions Conference in New York. “Someone is going to get hurt. … We don’t do much of that.”

Source: Jamie Dimon just sounded the alarm on auto loans

More Americans Plan to Retire After 70 

More Americans Plan to Retire After 70 

While most acknowledge that people are living longer, one area that people are only coming around to realizing is living longer means either having to save more for their golden year or working later in life. As the data shows, however, it’s looking more and more like people will have to retire later (if at all) given the financial shortfall. Contending with this potential financial shortfall and overcoming it is a part of our Aging of the Population investing theme.

Employees in the U.S. are more pessimistic about whether their generation will be “much worse off in retirement” compared with their parents’ generation. In America, 76 percent agreed or strongly agreed with that statement. Globally, 66 percent agreed.

Source: More Americans Plan to Retire After 70 – Bloomberg

As the OECD cuts U.S. economic forecast again, it calls on the debt rattled U.S. to step up spending

As the OECD cuts U.S. economic forecast again, it calls on the debt rattled U.S. to step up spending

As we’ve learned, shovel ready projects are like unicorns – they sound great, but few have ever seen them. With the US National Debt hovering at $19.3 trillion and Gross Debt to GDP at 105.2% per USDebtClock.org (the scariest page on the Internet), the OECD’s call “government in the US to step up spending is bound to ignite a powder keg as the 2016 presidential election moves into high gear.

The U.S. economy will expand 1.8% this year, down from 2.4% last year, the OECD said. The forecast is down from 2.5% in November and 2% in an interim report in February.

The world economy is forecast to expand 3% in 2016, the same as in the earlier forecasts. Slower growth in the U.S. will be offset by slightly stronger performances in Europe and Japan, the OECD said.

Now it is up to governments in the U.S. and elsewhere to increase spending to jolt the global economy out of a “low-growth trap.”

Source: OECD lowers U.S. economic forecast, implores world policymakers to ‘act now’ to boost growth – LA Times

Is SodaStream Offering You To Make The Tang of  Beer At Home?  $SODA

Is SodaStream Offering You To Make The Tang of  Beer At Home?  $SODA

Maybe it’s just us, but this potential Guilty Pleasure opportunity lost us at “adding Blondie concentrate.” Sure some may want to drink the Kool-Aid or Tang of beer, but we’re thinking if you’re going to reach for a cold one the last thing you want is some beer concentrate at the bottom of your glass. For now, we doubt other Guilty Pleasure companies like Anheuser Busch Inbev SA (BUD), Molson Coors (TAP) or Craft Brew Alliance (BREW) will have much to worry about.

The Beer Bar only makes one beer so far, a light beverage called “Blondie,” which contains 4.5% alcohol by volume and has “a smooth authentic taste, and a hop filled aroma,” SodaStream says.

The system works by adding Blondie concentrate to sparkling water, resulting in about three liters of beer per one liter of Blondie concentrate.

Source: SodaStream Wants You To Make Your Own Beer At Home – Consumerist

The air-leasing sector may soon face harder times | The Economist

The air-leasing sector may soon face harder times | The Economist

Part of our Scarce Resources thematic, the reduction in spending by airlines on planes, as well as a reduction in fuel costs is a good thing for bottom lines of these titans of the skies. Of course, there is another side to that coin as well . . . if companies aren’t leasing planes, then leasing companies aren’t buying planes . . .and manufacturers aren’t selling them.

When oil prices were high, airlines were desperate to replace gas-guzzling planes with new, fuel-efficient ones. Given the daunting commercial outlook, many preferred to lease their new jets, leaving the leasing firms to stump up the capital required to buy planes. Leasing firms are now responsible for about 40% of the big planemakers’ sales.

Source: The air-leasing sector may soon face harder times | The Economist

Champagne bubbles: reflect more than just the quality of the bubbly

Champagne bubbles: reflect more than just the quality of the bubbly

Talking about “markets” and “bubbles” is always a dangerous thing, but when it comes to these bubbles, it can be fun, particularly as it reflects part of our Affordable Luxury thematic . . .

Treated as a barometer of global consumer confidence, Champagne sales are a good indicator of whether shoppers are buying luxury or premium goods, and also whether they feel flush enough to invest in global equities or housing.

 . . . After eight years of post-crisis adjustments, it appears “demand for premium goods and services is finally getting back to the pre-crisis ‘normal’ . . . ”

Source: BBC – Capital – Why we’re drinking more Champagne than ever before

American Death Rate Rises for First Time in a Decade 

American Death Rate Rises for First Time in a Decade 

A data point that conflicts clearly conflicts  our Aging of the Population investing theme – not a bad thing per se it just means double checking other data and seeing if this is an aberration or the start of something.

“It’s an uptick in mortality and that doesn’t usually happen, so it’s significant,” said Robert Anderson, the chief of mortality statistics at the National Center for Health Statistics, part of the Centers for Disease Control and Prevention. “But the question is, what does it mean? We really need more data to know.”

“We are not accustomed to seeing death rates increase on a national scale,” said Andrew Fenelon, a researcher at the C.D.C. who did not work on the paper. “We’ve seen increases in mortality for some groups, but it is quite rare to see it for the whole population.”

Source: American Death Rate Rises for First Time in a Decade – The New York Times

Potential Good News for Investors as Jose Cuervo Contemplates IPO 

Potential Good News for Investors as Jose Cuervo Contemplates IPO 

Nothing wrong with there being one more Guilty Pleasure investing candidate in the market… subject to due diligence of course!

According to Bloomberg, the world’s largest tequila producer wants to raise as much as $1 billion in an initial public offering slated for the third quarter.

Source: Jose Cuervo IPO – Business Insider

With May @MarkitEconomics manufacturing PMI for #Japan @ 40 month low @AbeShinzo plans more stimulus

With May @MarkitEconomics manufacturing PMI for #Japan @ 40 month low @AbeShinzo plans more stimulus

Despite all the central bank intervention to date, Japan’s manufacturing economy continues to contract.  May MarkitEconomics manufacturing PMI for Japan came in at a 40 month low with falling output and orders, which of course means Abe Shinzo sees it as a call to further stimulate the Japanese economy… sounds like more of the same (more debt, low to no growth) to us. 

Japan will delay its planned sales tax hike for a second time, Japan’s Prime Minister Shinzo Abe announced Wednesday, while also detailing a new stimulus package for the economy this fall.

Source: Japan Prime Minister Shinzo Abe plans large stimulus package this fall

Recently confirmed Myspace hack could be the largest yet, dwarfing @LinkedIn and @Tumblr breaches $HACK @SophosLabs @Time

Recently confirmed Myspace hack could be the largest yet, dwarfing @LinkedIn and @Tumblr breaches $HACK @SophosLabs @Time

While the myspace data breach may data back a few years, it’s size (roughly 427 million passwords!) serves as a reminder that not every breach/attack is immediately detected let alone thwarted. This serves as a harsh reminder on the ever evolving need for cyber security that fuels our Safety & Security investing theme.

Time, Inc. didn’t confirm how many user accounts were included in this data set, but a report from LeakedSource.com says that there are over 360 million accounts involved. Each record contains an email address, a password, and in some cases, a second password. As some accounts have multiple passwords, that means there are over 427 million total passwords available for sale.Despite the fact that this data breach dates back several years, the size of the data set in question makes it notable. Security researchers at Sophos say that this could be the largest data breach of all time, easily topping the whopping 117 million LinkedIn emails and passwords that recently surfaced online from a 2012 hack.

Source: Recently confirmed Myspace hack could be the largest yet | TechCrunch