7am Saturday is a weekly email I send at 7am every Saturday where I share brief and relevant thoughts on money or investing. Enter your email address below to subscribe:
October 26, 2019
Good morning! In case you missed it take a look at the U.S. stock market! The S&P 500 briefly passed it’s all time high yesterday during intraday trading but closed just 0.11% away from a new high. I call it close enough. Cheers! 🍻
Markets & Economy
Today, I’m going to do something a little different. Instead of writing an update on the market or economy I’m going to point you to a video I recently recorded for clients and friends of the firm.
Our investment team regularly monitors the markets and economy and tracks a list of pros, cons, and unknowns:
📺 Watch my 13-minute update on the market & economy. – I know there isn’t much detail with the items on the above list, but in the video I explain the items in bold. Here’s a list of topics I cover:
- An update of stock market performance for the year
- Which sectors have been leading and lagging the US stock market
- Our thoughts on the current economic expansion (which is the longest in US history)
- A look at the long-term trend of the stock market and where we think we are headed from here
- An update on dividend yields
- Why we think the probability of a recession in the near future is low
- The impact of the trade war with China
- How tariffs have impacted the manufacturing (hint: it’s at the lowest level we’ve seen since 2009)
- An update on the Federal Reserve and what we expect for interest rates the rest of this year
- Some thoughts on the 2020 election and what you should focus on as an investor
- Stats on market performance during October, November, December (historically the best quarter of the year)
If you have specific questions about any of these topics just hit reply and I’d be happy to answer them.
The Good Stuff
🐦 Someone I’m following on Twitter – If you’re on Twitter you will want to follow Jessica Hinks (@JessicaHinks2). Jessica is an Associate Wealth Advisor on our team and she’s launching something exciting this coming week. Follow her on Twitter so you don’t miss it. (Don’t worry…if you’re not on Twitter I will share more next week.😉)
🚗 Fact I’m pondering – Tesla overtakes GM as the most valuable U.S. automaker:
Tesla (TSLA) announced earnings on Wednesday and surprised investors by delivering on CEO Elon Musk’s promise of a profit during the third quarter. TSLA’s market capitalizaton is near $57 billion while GM is around $52 billion.
Some highlights from TSLA’s quarterly report:
- TSLA also announced a record 97,000 deliveries during the quarter. The company is expecting total deliveries to exceed 360,000 this year.
- The new gigafactory in Shanghai is complete (built in just 10 months) and production of the Model 3 in China has begun.
- Model Y is expected to launch by the summer of 2020.
- Limited production of the Tesla Semi will also begin in 2020.
- A location announcement for the European Gigafactory is coming soon with production planned for 2021.
My take: in spite of the skeptics TSLA continues to do some big things and they are leading the way in changing the auto industry (electric vehicles + autonomous driving). Full self driving capability is just moments away. Musk has made mention that they will release this feature to some customers yet this year. The cars will drive themselves from point A to point B, but for now drivers must still stay engaged and be ready to take control.
Consider this: During Q3, TSLA registered one accident for every 4.34 million miles driven in which drivers had Autopilot engaged. This compares to the national average of one accident for every 0.5 million miles based on NHTSA’s most recent US data. As scary as it may seem to many autonomous driving will make the roads safer. And that’s something I can get excited about with a teenage driver in the house!
🔖 A blog post worth bookmarking – I really enjoyed re-reading this post from Ben Carlson, Different Ways to be Rich in 2019. It’s a great reminder that being “rich” is more about relationships, happiness, and freedom and less about how much money we have in the bank.
❓Really Good Question (RGC) of the week – What’s the book that has taught you the most about yourself and/or most materially changed the way that you live?
I’m always building a list of good books I want to read. The challenge is there are more books I want to read than I currently have time for. But, I’m curious. How would you answer this question? I’d love to hear from you so I can filter my “want to read” list. Hit reply and let me know.
🏐 Volleyball update – The Liberty-Benton Eagles are District Champions! The Eagles won two more tournament games this past week bringing this season’s record to 24-2. On Thursday they beat Coldwater to win the District and move on to Regionals where they will have to win two more matches to make it to State. Here’s a pic of the District Champs:
🏈 Buckeye fans: Okay Buckeye fans, the game we’ve been waiting for is here! #3 Ohio State takes on #13 Wisconsin today at noon. Here’s the pregame hype video.
Make it a great day,
↩️ PS – If anytime you get an email from me and you want to share a comment or ask a question, simply hit ‘reply.’ I read every email, and try my best to respond.
📧 PPS – Thank you for all the feedback on these emails. I’ve had an overwhelming amount of positive replies to my new weekly email. If you’re finding these emails helpful, please forward them to your friends. Or, you can always direct them to 7amSaturday.com to sign up.