Where's Brando?

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Good Day and happy (?) first day of winter.

The fall semester/term grades have been posted, the committee reports reviewed, checks have been cut, holiday shopping completed, holiday parties (thankfully) are done, and now we concentrate on absolutely nothing.

I am sure at one point in our lives we had a neighborhood dog or cat that everyone on the block knew and watched out for. Our neighborhood had Brando, a tabby orange cat that began his day by playing hide and seek with the local birds, then he relaxed in the sun on a variety of front porches, and concluded his day patrolling the block occasionally rolling on the pavement scratching and stretching.

Well Brando has disappeared, no one knows where. Was it a coyote, who on the odd occasion visit the neighborhood from the nearby foothills, or perhaps he was just picked up by a cat lover, though he did have an identifying collar.

A sense of gloom has settled over this square block area, signs have been posted, his family has roamed the surrounding area, no Brando. In the grand view of life and its daily events this loss of Brando seems minor. But, it is a loss to a small area of the community where a small little cat keeps a neighborhood being a neighborhood and we miss him.

Speaking of a loss, any one look a their 401k lately? Let's survey the damage.

The S&P 500 is now at a 15-month low, and member companies have shed a combined $2.39 trillion in market cap...just this month.

The Dow has now lost more than 1,700 points in the last five sessions and sits at a 14-month low.

The tech-heavy Nasdaq flirted with bear market territory (down close to 20% from its recent high).

So what caused the headache?

Well, (as always) it was likely a mix of symptoms.

First up? The possibility of a government shutdown. House Speaker Paul Ryan said President Trump will not sign a temporary funding bill to avoid a partial government shutdown without the promise of funding for a U.S.-Mexico border wall.

The House did approve a bill complete with more than $5 billion for the wall late Thursday, but it's unlikely the measure will make it through the Senate.

Making matters worse? The market's still reeling from the Fed's decision to raise interest rates Wednesday. Fed chief Jerome Powell cited strong economic data, but that wasn't enough to keep investors from longing for the easy-money, low-interest-rate days.

Feels fitting to cap the year this way

Remember the good ol' days? When we were talking markets-at-new-highs, record-earnings?  The trade war has actually come to pass, the nearly decade-long bull market is losing steam, and global economic expansion isn't what it used to be. That's spooked investors...who've taken their worries out on growth-sensitive stocks.

MARKET WEEK - Dividends have been a silver lining for the stock market this year, but investors are grappling with whether they can keep up such a rapid pace of growth. Companies in the S&P 500 have spent nearly $421 billion on dividends through November, a record-setting sum that eclipsed last year's mark of roughly $391 billion and the full-year tally of $420 billion, according to S&P Dow Jones Indices. More than two dozen companies announced additional dividend increases so far this month, which will push the year's total even higher.

Those payouts are easing investors' burden as they navigate a challenging investment environment. The S&P 500 is on pace to fall 2.8 percent this year for its first annual loss since 2015, as concerns including a trade spat with China, Federal Reserve interest-rate increases and a sharp drop in oil prices point to the potential for an economic slowdown.

Investors will soon bid good riddance to 2018, a stressful year marked by two stock market corrections, rising interest rates, an ugly trade battle, and growing fears that a bear market lies just around the corner. Yet as U.S. stocks stumble toward what could be their first yearly loss since 2015, next year is looking rather sunny. So say the 10 market strategists Barron's consulted this month, all of whom have 2019 targets for the S&P 500 index that are higher than the benchmark's recent price level of 2600.

The Federal Reserve will conclude its final policy meeting of the year Wednesday. With traders widely expecting the central bank to raise short-term interest rates, many say the focus will be on Fed officials' comments on the economy.

Volatile markets and mixed inflation data have amplified investors' doubts about how many times the Fed can raise rates next year. Also fueling the hesitation are remarks by Chairman Jerome Powell, who said in November that rates looked like they were 'just below' neutral, a level that would neither speed nor hamper economic growth. The result: Many traders have begun pricing in a more gradual course of rate increases for 2019.

When the U.S. Federal Reserve dropped its policy rate to near zero on Dec. 16, 2008, to counter a full-scale economic crisis, it ushered in what the central bank's chairman at the time, Ben Bernanke, called 'the end of the old regime.'

A decade later, the full impact and import of that move are still not fully clear. But the Fed was never the same. The decision to move to zero ushered in wholesale changes to how the Fed works, from its building a massive balance sheet to adopting an explicit 2 percent inflation target and holding regular post-meeting press conferences. A new body of research continues to explore the likelihood that trips to the 'effective lower bound' will become common.

Microsoft is close to becoming the most valuable U.S. company for the first time since 2003, according to Dow Jones Market Data. If the software firm eclipses Apple in market value, it would knock the iPhone maker off the top spot for the first time since 2016, when Google parent Alphabet briefly topped Apple. Apple is valued at $829 billion, while Microsoft is at $817 billion and Amazon.com is at $773 billion.

Bitcoin is down more than 42% this month, on pace for its worst month on record, according to Dow Jones Market Data.

Stocks to Watch

Apple: President Trump told The Wall Street Journal that the U.S. could place tariffs on iPhones and laptop computers imported from China, depending on how trade negotiations proceed.

Bristol-Myers Squibb: The company reported that a lung-cancer treatment failed in a clinical trial.

Buckle: The fashion retailer said sales fell 4.1% in the most recent quarter, a bigger drop than Wall Street anticipated.

MTS Systems: The maker of test systems and industrial position sensors reported a larger-than-expected drop in quarterly revenue.

POTUS - Thursday was one of the most remarkable days, tucked inside one of the most remarkable weeks, capping one of the most remarkable months in modern presidential history.

Scary thought: It’s hard to find people around Trump or in Republican politics who don’t think things could get worse.

NBC News reported last night the Mueller report will drop as soon as mid-February.

Another reason this is a historic week — and what President Trump should really worry about — is that lots of different Republicans have been turning on him over different topics.

In an unusually harsh statement, Senate Majority Leader Mitch McConnell said he was "distressed" about Mattis' departure: "It is regrettable that the president must now choose a new Secretary of Defense. But I urge him to select a leader who shares Secretary Mattis's ... principles."

Sen. Ben Sasse (R-Neb.) said after the Mattis announcement: "This is a sad day for America."

A former Trump aide who asked to be described as "a Trump ally" told me that the sudden wave of criticism from the Hill over Syria and Mattis should scare the president because he would desperately need these lawmakers' support during a possible impeachment battle.

"Once Republican lawmakers start rebuking the president publicly like this over policy, it makes it easier for them to say: 'It's not just Mueller or ethics. There are other concerns.' Then it's a slippery slope."

Donald Trump may not know it yet, but his presidency is collapsing. As long as [Mattis] served the president, reluctant Republicans could point to the Pentagon and say: If Mattis supports Trump, then so do I. They can no longer do that.

What to watch: There’s a working assumption inside the White House that Trump will be impeached by the House. He would then need a rock-solid base of 34 Republican senators to refuse to remove him from office (which takes 67 votes).

So nothing matters more to Trump than keeping his base happy and loyal.

COLLEGE CHRONICLES - in remarks on Wednesday at the American Council on Education, Betsy DeVos said she wants to cut regulations on colleges to encourage them to offer credentials that will lead to well-paying jobs for students. The address was intended to set the stage for rule-making sessions next month that will focus on topics like the accreditation process, innovation in higher education, and the regulation of distance-ed programs. Some listeners pointed out that the education secretary's plans could pose problems for the association's members and for students.

Fewer international students are heading to the U.S. to study. Two years of declines in international student enrollment are sending waves of unease to U.S. schools as they face challenges amid rising competition, concerns about safety and immigration policies.

In a remarkable scene last week, Lou Anna K. Simon, the former president of Michigan State University, was arraigned on charges that she lied to the police about how much she knew of the university's investigation of Larry Nassar, the former professor convicted of sexually abusing hundreds of women. If convicted (her lawyer has called the charges baseless) Simon would join the likes of Graham Spanier, the former Penn State president, as college leaders implicated in crimes involving the endangerment of children and teenagers on their watch.

Gregory Anderson, interim vice president for instruction at Mt. San Antonio College, has been named president of Riverside City College. He had been president at Saddleback College but resigned in April after less than six months at the helm, citing "personal circumstances." Something is not right here.

HOLIDAY READING - The long-awaited break is finally here. Maybe you will actually read those stories and stacked up New Yorkers that you've been meaning to get to, or maybe not. Either way, here are Rink Rats staff-recommended reads from across the internet. First, if you think that your roommates were bad, wait until you read this story. A New York Times investigation found that Facebook gave companies like Netflix, Spotify, and Microsoft more access to users' data –– like the content of private messages –– than the company had previously reported. Listen to this fascinating podcast about the world of pyramid schemes. The Washington Post reports on why more people aren't talking about the opioid epidemic among African-Americans.

Top Five holiday movies:

1). Holiday Inn (1942)

2). Home Alone (1990)

3). White Christmas (1954)

4). Scrooge (1951)

5). Die Hard (1988)

DRIVING THE WEEK — Parts of the government shut down Friday barring a deal to kick the can into January ... Trump leaves for Mar-a-lago on Friday for a long holiday and splitting town for vacation as the government shuts down would not be a good look ...

Days until the 2019 election: 319

Days until the 2020 election: 683

GOOD READ - NYT'S MAUREEN DOWD: "Of Monuments, Arguments, Vampires and Thanksgiving: John Wayne, Brett Kavanaugh, my brothers Michael and Kevin, and me."

What to Watch This Weekend

N.B.A. The marquee matchup on Christmas Day is the Los Angeles Lakers vs. the Golden State Warriors (8 p.m. Eastern, ABC/ESPN). But if you wait until then to tune in, you will miss some of the season's stars: Giannis Antetokounmpo (Milwaukee Bucks vs. Knicks, Noon, ESPN); Russell Westbrook and James Harden (Oklahoma City Thunder vs. Houston Rockets, 3 p.m., ABC); plus, too many to name in Philadelphia 76ers vs. Boston Celtics (5:30 p.m., ABC). Then wrap up your night with Damian Lillard and Donovan Mitchell in Portland Trail Blazers vs. Utah Jazz (10:30 p.m., ESPN).

N.F.L. Have the Saints lost their mojo? After two straight mediocre games, Drew Brees & Co. will face another tough test in the suddenly-good-again Steelers (Sunday, 4:25 p.m., CBS). 

COLLEGE BASKETBALL It will seem like old times Saturday as former Big East rivals Connecticut and Villanova clash at Madison Square Garden (12:30 p.m., CBS). In the afternoon, two blue-hued blue bloods, No. 19 Kentucky and No. 9 North Carolina, face off in Chicago (5:15 p.m., CBS). Your nightcap comes from Tempe, Ariz., where top-ranked Kansas will face the Curtain of Distraction along with feisty No. 18 Arizona State (9 p.m., ESPN2).

SOCCER Settle in for a loooong holiday season of soccer, with 40 Premier League matches in 14 days. You’ll start with first-place Liverpool vs. Wolverhampton (Friday at 3 p.m., NBCSN and Universo), then watch Manchester United’s first match without Jose Mourinho (Saturday at 12:30 p.m., NBCSN) and grab a seat on the couch for a Boxing Day matchup of Leicester City vs. Manchester City (10 a.m., NBC Sports).

HOCKEY The Sabres enter Friday's game against the Capitals with more points than the defending champions, but Buffalo has lost seven of its last 10 and Washington has won seven of 10 (7 p.m., NBCSN). Games between the Rangers and the Flyers are always intense, but with both teams struggling, Sunday's matchup may not be, well, very good (7 p.m., NHL Network, MSG).

COLLEGE FOOTBALL BOWL GAMES GET IT???? - The argument against bowl games is that they are essentially meaningless exhibitions designed to make money — mostly for Disney, which not only broadcasts but straight-up owns many of them.

This argument has been sharpened by the rise of the playoff and, if that playoff expands to eight teams in the future, it'll get even sharper.

Add in the increasing normalization of top prospects skipping bowl games and you are looking at an argument that just might cut diamonds.

But, but, but: I, for one, love bowl games and think we ought to have as many of them as possible.  There's something nostalgic and fun about sitting down around the holidays and binge-watching football games between obscure teams you wouldn’t have watched otherwise."

It wouldn't be the week between Christmas and New Year's without going from zero knowledge about, say, Memphis' offense to becoming a full-fledged expert in a matter of hours.

P.S. I also thoroughly enjoy the absurdity of bowl game names and sponsors. Cracks me up. One of my favorites took place last night and another one is today.

Bad Boy Mowers Gasparilla Bowl: This bowl used to be called the "St. Petersburg Bowl presented by Beef O'Brady's," which is almost as hilarious. // Last night: USF lost to Marshall, and in doing so, became the first team to ever finish the season 7-6 after starting 7-0.

Makers Wanted Bahamas Bowl: Elk Grove Village, IL is home to the largest industrial park in the US, and they're sponsoring this bowl to bring attention to that, I guess. This game is sponsored by an industrial park! Long live bowl games. // Today: FIU vs. Toledo, 12:30 PM ET.

SWAMI’S WEEK TOP PICKS –

NFL Football Pick of the Week – Saturday 12/22 8:20 PM ET, NFL: Baltimore Ravens (8-6) vs. Los Angeles Chargers (11-3). Playoff implications abound in this battle at the Stub Hub Center, Chargers rule 24 – 17.   (Season to date 9-5)

NHL Game of the Week – Saturday 12/22: Nashville Predators (22-12-2) visit Boston Bruins (19-12-4). Another classic afternoon matinee in Boston, Bruins need a win to get back some mojo, they do 4 – 3. (Season to date 5-2)

Season to Date (57 – 35)

Next Blog: 2018 review.

Until next time, To you and yours a wonderful holiday.

Spring Arbor, Michigan

December 21, 2018

#IX-15-383

CARTOON OF THE WEEK – Peanuts, Charles Shultz

RINK RATS POLL –

Christmas Eve or New Year’s Eve?

_____ Christmas Eve

_____ New Year’s Eve

_____ Neither

QUOTE OF THE MONTH – "Good instincts tell you what to do long before your head has figured it out." - Michael Burke

Rink Rats is a blog of weekly observations, predictions and commentary. We welcome your comments and questions. Also participate in our monthly poll. Rink Rats is now viewed in Europe, Canada, South America and the United States.

Posted at Rink Rats The Blog: First Published – May 3, 2010

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