Archive
Hot Tips
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January 22, 2025
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Netflix Earnings Rocket,
up 1 after-hours trading on Tuesday on the back of 19 million new subscribers. The streaming giant reported better-than-expected fourth-quarter results and raised its 2025 revenue forecast. For the fourth quarter, earnings of $4.27 per share topped Street estimates of $4.18. Revenue of $10.25 billion also topped the Bloomberg consensus estimate of $10.11 billion. Netflix added 18.91 million subscribers in the quarter versus an expected 9.18 million. Mad Hedge already took profits on a long going into the announcement.
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Home Insurance Costs are Soaring,
for homeowners in the most-affected regions, California and Florida. For consumers living in the 20% of zip codes with the highest expected annual losses, premiums averaged $2,321, or 82% more than those living in the 20% of lowest-risk zip codes from 2018-22. This is going to get worse before it gets better.
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Fartcoin Stage Reached in Crypto,
says hedge fund manager David Einhorn. “Other than trading and speculation, it serves no other obvious purpose and fulfills no need that is not served elsewhere,” he said. I couldn’t agree more. President Donald Trump launched $TRUMP, a meme coin built on the Solana platform. Its market cap over the weekend climbed past $14 billion. The coin at one point was down more than 20% over the past 24 hours, but it has since cut its losses to around 3%. Avoid all crypto.
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Ban Lifted on New Natural Gas Export Facilities in 4 Years,
reversing a Biden-era climate initiative. Cheniere Energy (LNG), an old Mad Hedge favorite, has risen 75% since the summer, sold off on the news. The big winner here? China, which can now buy more low-priced natural gas.
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Trump Bans Offshore Windmills,
as an alternative energy source. Shares of European windmill makers get crushed. It is now all about oil, oil, oil! Biden’s Green Initiative goes down the toilet.
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January 17, 2025
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Mad Hedge Hits New All-Time High,
up 1.51% so far in January and +753.40% since inception. 2024 came in at +75.26%, with less than half the market volatility. My Average annualized return stands at +49.91%.
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Housing Starts were up 3.0% in December,
with single-family homes up only 3%, while multifamily saw a 59% rise. It should shift away from home sales crushed by 7.2% mortgage rates. You can write off real estate in 2025.
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Industrial Production Triples,
to .9% in December from the forecast, the best in a year. Capacity Utilization rises to 77.5%. The hot economy continues. The new president is inheriting the best economy in two decades.
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EV and Hybrid Sales Reach a Record 20% of US Vehicle Sales,
in 2024, and now account for 10% of the total US fleet. And you wonder why oil prices are so low. That includes 1.9 million hybrid vehicles, including plug-in models, and 1.3 million all-electric models. Tesla continued to dominate sales of pure EVs but Cox Automotive estimated its annual sales fell and its market share dropped to about 49%.
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SpaceX Starship Blows Up, on test launch number seven.
The Federal Aviation Administration issued a warning to pilots of a “dangerous area for falling debris of rocket Starship,” according to a pilots’ notice. Looks like that Mars trip will be delayed.
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January 16, 2025
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Budget Deficit Jumps in Q4,
to $710 billion, $200 billion more than forecast. Rising interest payments and falling tax revenues are to blame. $50 trillion, here we come. Bonds hated the news, with the (TLT) breaking $85. Sell all bond rallies.
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EIA Expects Weak Oil Prices for All of 2025.
Many analysts expect an oversupplied oil market this year, after demand growth slowed sharply in 2024 in the top consuming nations: the U.S. and China. The EIA said it expects Brent crude oil prices to fall 8% to average $74 a barrel in 2025, then fall further to $66 a barrel in 2026.
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JP Morgan to Step Up Share Buybacks,
now that the latest capital requirement has been fully met. JPMorgan Chase executives said the bank would increase share buybacks so that a mounting pile of tens of billions of dollars in excess cash doesn’t grow further. Yet another reason to buy (JPM) on dips.
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Morgan Stanley Doubles Profits.
Equities were the big winner, with revenue jumping 51% in the quarter and reaching an all-time high for the full year. In the wealth business, net new assets fell just shy of estimates even as revenue topped expectations.
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Weekly Jobless Claims rise to 217,000,
up 14,000 as the spike of last week’s report fades. We’re still operating at the high end of the recent range.
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January 15, 2025
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JP Morgan Announces Record Profits,
boosted by volatility tied to the US elections in November. Trading revenue at the firm rose 21% from a year earlier, jumping to $7.05 billion. Fixed income was the star, with revenue beating analysts’ estimates, while equities-trading revenue fell short. Buy (JPM) on dips.
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Goldman Sachs Beats.
The firm’s fourth-quarter profits more than doubled to $4.1 billion, buoyed by strength in its investment bank, expansion of its asset management business, and a surprise $472 million gain from a balance sheet bet. Goldman ended 2024 as the best-performing stock among major US banks with a 48% advance. The bank is positioning itself for a long-awaited resurgence in deals after ditching major parts of a consumer foray.
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SEC Sues Elon Musk,
alleging the billionaire violated securities law by acquiring Twitter shares at “artificially low prices.” In his purchases, Musk underpaid for Twitter shares by at least $150 million, the SEC says. Musk bought Twitter in 2022 for about $44 billion, later changing the name to X. Expect this case to get lost behind the radiator next week.
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Fed Minutes are Turning Hawkish,
making an interest rate cut this month unlikely. Inflation is stubbornly above target, the economy is growing at about a 3% pace and the labor market is holding strong. Put it all together and it sounds like a perfect recipe for the Federal Reserve to raise interest rates or at least to stay put.
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Consumer Price Index Cools at 0.2%,
or 3.2% YOY, the first drop in six months. Economists see the core gauge as a better indicator of the underlying inflation trend than the overall CPI which includes often-volatile food and energy costs. The headline measure rose 0.4% from the prior month, with over 40% of the advance due to energy.
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January 14, 2025
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Tame PPI Boosts Stocks.
Data from the Labor Department showed the Producer Price Index rose 3.3% on an annual basis in December 2024, compared with the 3.4% rise expected by economists polled by Reuters. On a monthly basis, the index rose 0.2%.
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Biden Tanks Chip Stocks with New AI Rules,
which will almost certainly get undone in a week. On Monday, the Commerce Department outlined new rules that impose caps on how many advanced artificial intelligence chips can be exported to certain countries, along with additional licensing requirements for AI technology. The move prompted a low opening for stocks from which it quickly recovered.
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Amazon is Getting Ready for Another Run.
Strong earnings and continuing excitement about artificial intelligence will help Amazon stock move back into the green. The e-commerce and cloud company to beat estimates when it reports its fourth-quarter results—analysts are expecting a profit of $1.48 a share on sales of $187.3 billion, according to data from FactSet. Buy (AMZN) on dips.
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China in Talks to Sell TikTok to Elon Musk,
to avoid a court-ordered shut down in the US. TikTok's U.S. operations could either be sold through a competitive process or an arrangement by the government, the report said, suggesting that the future of the app is no longer solely in ByteDance's control.
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$4 Trillion in Asset Management Disrupted by Los Angeles Fires,
with some relocating office space and supporting staff members who have lost their homes. The LA area is home to large industry players like Capital Group, TCW Group and hedge funds Oaktree Capital and Ares Management.
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