This Week On Wall Street
Tuesday, CaseShiller 20. Housing prices on the CaseShiller 20 index of 20 cities will be released at 9:00am. Consensus estimates are for a 6.5% year over year rise in real estate prices. The number could be especially important after the recent fall in existing home sales, which have declined for 4 straight months. Rising prices would mean the dip is due to tightening inventory. Falling prices would put the blame on falling demand.
Wednesday, GDP 2nd Esimate. Market expectations are for GDP to be revised down to 4%. This probably won’t move markets but it will be watched.
Thursday, Personal Consumption Expenditures Inflation Index. This one is a big deal. The market expects the Core PCE Index, the Fed’s preferred measure of inflation, to hit 2% year over year this month, the Fed’s official target. If it goes above that, we may see a jump in the commodity markets, particularly precious metals which have sold off heavily over the last 2 months.
Friday, University of Michigan 5-year inflation expectations. This number was cited by Fed Chair Jerome Powell at Friday’s Jackson Hole symposium as the justification for central banks to be more accommodative, the logic being that grounded inflation expectations keep actual inflation lower, and therefore give more policy room for a central bank to tinker with the economy. The expectation for 5-year inflation expectations, AKA metaexpectations, are for 2.5% inflation 5 years out.
Tesla Staying Public, Musk May Have SEC Woes
In a statement released on Friday night last week, Elon Musk, Tesla (NASDAQ:TSLA) CEO, confirmed the end of his plans to take the company private for $420 a share. “Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this,’” Musk wrote. And so he didn’t. Questions are being raised as to whether Musk should remain as CEO of the company or move to the side as a general visionary but let someone else with less itchy Twitter trigger fingers take the helm. Also, whether the SEC will let Musk get away with swinging the stock in both directions with his tweet about bringing the company private.
Cryptocurrency IPO Fest in Hong Kong, Bitmain, Canaan, Ebang All Invited
The world’s largest suppliers of cryptocurrency mining gear, are gearing up themselves for IPOs in Hong Kong. It’s being speculated that the reason for the IPOs now is that the founders of Bitmain, Canaan, and Ebang want to realize some of their gains from building their businesses up to this point, without risking losing it all in the event that Bitcoin (BTC-USD) or other altcoins crash, a possibility that is always in the back of everyone’s minds. The IPOs should give mainstream investors a sense of how valuable these new companies are, and could help support the prices of the major cryptocurrencies for a while, if not indefinitely.
Disney Settles With Union on $15 Minimum Wage by 2021
Disney (NYSE:DIS) after a year of contract negotiations with the Service Trades Council Union, has settled on deal that would see the minimum wage at Disney resorts rise to $15 an hour by 2021, plus offer 3% retroactive pay to workers going back to September 2017. Unite Here Local 361 President Eric Clinton perhaps a bit pompously referred to Disney as a “foe” even though he relies on Disney for his livelihood, and despite Disney acceding to union demands anyway. According to Disney, this is the “largest proposal ever offered by Walt Disney World Resort with significant pay raises.” This comes after a deal was already settled in July to give 10,000 Disney workers in Anaheim, California, an increased minimum wage of $15 by next year. Does this flexibility by Disney signal that inflation is headed higher?
Michael Cohen Maybe Didn’t Know That Trump Knew About ‘Russian Collusion’
President Donald Trump’s former lawyer Michael Cohen’s current lawyer Lanny Davis now claims that maybe Michael Cohen can’t exactly confirm that Trump knew about Russian efforts to influence the 2016 presidential election. Earlier, Davis claimed that Cohen could confirm that Trump knew about the meeting with Russian official at Trump Tower, but now says that even though that may be true, Cohen can’t confirm that Trump knew with any hard evidence. Chances of impeachment are now slightly lower than they were last week.