Morning News: December 30, 2022
Posted by Eddy Elfenbein on December 30th, 2022 at 7:04 am

Euro Brings Closure for Croatia Almost 30 Years After War

The Year the Long Stock Market Rally Ended

After $18 Trillion Rout, Global Stocks Face More Hurdles in 2023

Biden Signs Government Funding Bill, Preventing Shutdown

Retiring Fed President Challenged the Consensus Inside Central Bank

Mortgage Rates in the US Rise for First Time in Seven Weeks

Tax Credits for Electric Vehicles Are About to Get Confusing

Deal-Making Thrived in 2022, Then Hit a Road Bump

The 2022 Good Tech Awards

As Infrastructure Windfall Approaches, Transit Agencies Grapple With How to Spend It

Large Pay Gains Outpace State Minimum-Wage Boosts for Many Workers

Small Businesses Find Some Relief From Hiring Woes

It Takes an Iron Will to Create a Fitness Empire Out of Kettlebells

Hershey Sued Over Chocolate Containing Heavy Metals

Southwest’s Silver Lining: Memories of Gaffes Fade Fast

Tesla Stock Is Headed for Its Biggest-Ever Annual Decline

Bahamas Seized $3.5 Billion FTX Assets on Custody Concerns

Roman Abramovich’s Very Bad Year of Losses, Forced Sales and Moored Superyachts

Be sure to follow me on Twitter.

Morning News: December 29, 2022
Posted by Eddy Elfenbein on December 29th, 2022 at 7:09 am

Japan Insurers to Continue Russia Shipping Coverage

Europe Taps Tech’s Power-Hungry Data Centers to Heat Homes

After a Bumpy Year, Renewable Energy Looks Poised for Boom Times

Oil Falls as China COVID Spike Dampens Demand Outlook

Exxon Sues EU in Move to Block New Windfall Tax on Oil Companies

Euro Zone Business Lending Growth Slows Sharply in November

The Stephanomics Guide to the Global Economy in 2023

The Numbers in the News

Wall Street’s Top Stars Got Blindsided by 2022 Market Collapse

The Most Interesting Success and Failure of 2022

What ‘Get Into a Fistfight’ and Bosses’ Other New Year’s Resolutions Mean for You

As Silicon Valley Retrenches, a Tech Talent Shift Accelerates

Inflation Takes Biggest Bite From Middle-Income Households

Consumers Change Food-Delivery Habits

Tesla’s Worst-Ever Year Brings $17 Billion Windfall for Shorts

Southwest’s Woes No Longer ‘Weather-Driven,’ Transportation Secretary Says

How Southwest Airlines Melted Down

18% of Families Pile on Debt to Finance Trip to Disney, Study Shows

Be sure to follow me on Twitter.

Morning News: December 28, 2022
Posted by Eddy Elfenbein on December 28th, 2022 at 7:05 am

China’s $1.3 Trillion Housing Crackdown Leaves Few Winners

Hong Kong Ends Last Covid Curbs in Bid to Revive Finance Hub

Hong Kong November Home Prices Ease to More than 5-Year Low

Five Scenarios That Threaten More Strife for Global Markets

The Bull-and-Bear Case for 2023

Crypto Exchange Kraken to Stop Operations in Japan

Solana Tumbles Again, Bringing Crypto Token’s 2022 Plunge to 94%

Sam Bankman-Fried’s Power Was Contingent on Belief

How the World’s Biggest Wealth Gainer Added $40 Billion in 2022

Treasury Department Outlines Rules for New Corporate Taxes

Holiday-Related Debt Soars 24% to an Eight-Year-High of $1,549

Google Employees Brace for a Cost-Cutting Drive as Anxiety Mounts

With New EVs Arriving, Brand Loyalty Goes Out the Window

The World Just Doesn’t Have Enough Planes as Travel Roars Back

Southwest’s Debacle, Which Stranded Thousands, to Be Felt for Days

AMC CEO Adam Aron, who Earns $19 Million, Asks for Salary Freeze in 2023 as Shares Plunge

Mickey’s Copyright Adventure: Early Disney Creation Will Soon Be Public Property

Misleading Ads Fueled Rapid Growth of Online Mental Health Companies

Be sure to follow me on Twitter.

CWS Market Review – December 27, 2022
Posted by Eddy Elfenbein on December 27th, 2022 at 7:24 pm

Ladies and Gentlemen,

Drumroll please.

I give you our 2023 Buy List.

Abbott Laboratories (ABT)
AFLAC (AFL)
AmerisourceBergen (ABC)
Broadridge Financial (BR)
Carrier Global (CARR)
Celanese (CE)
Danaher (DHR)
FactSet Research (FDS)
FICO (FICO)
Fiserv (FISV)
HEICO (HEI)
Hershey (HSY)
Intercontinental Exchange (ICE)
Intuit (INTU)
Middleby (MIDD)
Miller Industries (MLR)
Moody’s (MCO)
Otis Worldwide (OTIS)
Polaris (PII)
Science Applications International (SAIC)
Silgan (SLGN)
Stepan (SCL)
Stryker (SYK)
Thermo Fisher Scientific (TMO)
Trex (TREX)

The five new buys are:

AmerisourceBergen (ABC)
Celanese (CE)
Intuit (INTU)
Middleby (MIDD)
Polaris (PII)

The five sells are:

Church & Dwight (CHD)
Reynolds Consumer Products (REYN)
Ross Stores (ROST)
Sherwin-Williams (SHW)
Zoetis (ZTS)

This is our 18th annual Buy List. The new Buy List won’t go into effect until the start of trading on Tuesday, January 3. The 25 stocks will be equally weighted based on the closing price as of December 30.

Here’s the performance of our ETF versus the S&P 500 ETF over the last few months.

Our ETF is based on the Buy List but it’s not always a perfect match.

I’ll have more to say about the new buys in upcoming issues, but I’ll share some thoughts with you.

I’ve wanted to add AmerisourceBergen for some time. I came close last year but decided to cut it at the last minute. That was a mistake. The company is a major drug wholesaler. AmerisourceBergen was formed 20 years ago through the merger of Bergen Brunswig and AmeriSource. They also have units offering consulting services and veterinary supply.

Part of the reason I shied away from ABC in previous years is due to the legal liabilities surrounding ABC’s role in the opioid crisis. I won’t go into its culpability, but the outlook has cleared up to some extent.

Celanese is the world’s leading maker of acetic acid. That’s one of those things that few people even think about, but it’s used in dozens of applications. Celanese is also the world’s leading maker of vinyl acetate. That’s a key ingredient in furniture glue. They make 25% of the world’s supply.

Earlier this year, Celanese agreed to buy the Mobility and Materials division from DuPont for $11 billion in cash. The stock currently yields 2.7%.

I like Intuit a lot. They’re the folks behind TurboTax, QuickBooks, Credit Karma and Mailchimp. It’s a great business. To be frank, we’re adding it at a higher price than I’d prefer.

But today’s elevated price comes after a year in which the shares were clobbered. Intuit is down about 40% YTD. Even if we’re not getting in at a discount, at least we’re getting it a lot less than where it was. With a market value of more than $100 billion, Intuit is by far the largest of the new additions.

Middleby returns to our Buy List after a one-year hiatus. The company is a major supplier of kitchen equipment for restaurants and hotels. The stock did not have a good year in 2022 (-30%), but the business has rebounded quite well. I like this company.

Originally, Polaris made snowmobiles. They still do today, but they also make all sorts of off-road vehicles, those crazy “slingshot” cars, plus snowmobiles, power boats, pontoon boats and lots of other stuff. They also do a nice business in selling apparel. Polaris has increased its dividend every year for the last 27 years.

Coming up with the sells each year is hard, because you can’t help getting attached to some stocks. Ross Stores was on our Buy List for 10 years. It made 325% for us which is about double the gain of the S&P 500. Church & Dwight was on for five years, and Sherwin-Williams was on for six years. Most of our sells this year lowered guidance at some point in 2022.

Church & Dwight was particularly difficult to let go, but I think I made the right call. Perhaps I’ll add it back in the future like I’m doing with Middleby.

I decided to keep Heico, but it’s a pricey stock. It’s tempting to take profits and move on, but I’m willing to let it run for now. The recent earnings report helped convince me to keep it.

I was strongly considering adding Nike this year, but the stock shot up after its recent earnings report. Some other companies that I was considering were Trane Technologies, 3M, CDW Corporation and Dollar General.

AFLAC and Fiserv have been on all 18 Buy Lists. Also note that sometime in Q4 of 2023, Danaher will spin off its Environmental & Applied Solutions segment into its own company. The new company will be composed of Danaher’s Water Quality and Product Identification businesses. Until the company gets a name, it will be known as EAS.

That’s it. The Buy List is locked and sealed, and I can’t make any changes for an entire year. I announce our changes before they go into effect just so no one can claim that I’m playing games with our track record.

That’s all for now. The stock market will be closed on Monday, January 2. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: December 27, 2022
Posted by Eddy Elfenbein on December 27th, 2022 at 7:08 am

Putin Can’t Count on the Global Oil Market

Japan’s Nakao Sees Smoother Path for Kuroda’s Successor with BOJ Policy Shift

Chinese Public Shows Mixed Emotions About Covid Zero Ending

Amazon Packages Burn in India, Last Stop in Broken Recycling System

U.S. Finance Faces ESG Backlash, More to Come in 2023

Wall Street’s Big Banks Score $1 Trillion of Profit in a Decade

The Money Party is Over

Drug Prices Reach New High—in the Millions

Chip Inventories Swell as Consumers Buy Fewer Gadgets

‘Most Pro-Union President’ Runs Into Doubts in Labor Ranks

Retirees Are One Reason the Fed Has Given Up on a Big Worker Rebound

Laid Off Tech Workers Quickly Find New Jobs

What Would It Take to Turn More Offices Into Housing?

Getting Creative With Vacant Office Space: Storage, Gym, Film Set

Is A.I. the Future of Test Prep?

Southwest Airlines CEO Says More Cancellations Ahead as Airline Tries to Recover

Apple Japan Hit with $98 Million in Back Taxes

In the Bahamas, a Lingering Sympathy for Sam Bankman-Fried

Be sure to follow me on Twitter.

Morning News: December 26, 2022
Posted by Eddy Elfenbein on December 26th, 2022 at 7:04 am

Five Charts That Capture the State of Global Energy in 2022

Britain’s Soaring Energy Costs Strain Crisis Responders

Germany’s Energy Crisis Is a Cue to Chop Wood and Stock Up

Russia May Raise Crude Oil Exports if EU Ban Cuts Refining

Rising Power Prices in Europe Are Making EV Ownership More Expensive

In Nord Stream Mystery, Baltic Seabed Provides a Nearly Ideal Crime Scene

Why the Price of Plastic Is Crashing After a Record Surge

BOJ Kuroda Dismisses Near-Term Chance of Exiting Easy Policy

World Economy Is Headed for a Recession in 2023, Researcher Says

The Boundless Fatuity Informing the Simple-Minded Word ‘Recession’

Musk Warns Against Margin Debt on Risk of Market ‘Mass Panic’

Are You ‘Extremely Hardcore’ or Not? How Elon Musk Is Dividing Silicon Valley’s Elite

Reasons for Optimism in 2023

Why 2023 Will Be Like 1967’s ‘Summer of Love’ for the Stock Market

Housing Slump Set to Give Fed an Inflation-Fighting Assist

Baking Supplies Cost a Lot More This Year. So Did Flying. But That Flat-Screen TV Got Cheaper.

Restaurant Staffers Are Returning to Work After Covid Flight

When a Taylor Swift Concert Means Getting Your First Credit Card

Be sure to follow me on Twitter.

Merry Christmas!
Posted by Eddy Elfenbein on December 24th, 2022 at 9:21 am

I wanted to take this opportunity to wish everyone a Merry Christmas and a happy, healthy and profitable new year.

This has been an incredible year for us. The Buy List has soundly beaten the overall market. The newsletter is popular and our Twitter following is growing.

In September, our ETF turned six years old. I want to thank all our shareholders for their trust and confidence in me.

I also want to thank my tireless editor, Marcia Robertson. She also posts the invaluable morning news links. I also want to acknowledge some of my fellow financial bloggers: Barry Ritholtz, Josh Brown, Cullen Roche, Morgan Housel, Michael Batnick, Howard Lindzon, Ben Carlson, Tadas Viskanta and many, many others for their continued support.

I’d also like to thank the people who follow and interact with me each day on Twitter.

Most of all, I want to thank all of my readers for your continued support.

Let’s hope 2023 brings us more success!

Morning News: December 23, 2022
Posted by Eddy Elfenbein on December 23rd, 2022 at 7:04 am

Ukraine’s Parallel War on Corruption to Unlock Door to West

Japan’s Consumer Inflation Hits Fresh 40-Year High

Egg Prices Surge to Records as Bird Flu Hits Poultry Flocks

As Cases Explode, China’s Low Covid Death Toll Convinces No One

China’s Future Isn’t What It Used to Be

France Desperately Needs Workers, but the Fixes Could Anger Left and Right

Why America’s Economy Remains Surprisingly Strong – But You Don’t Realize It

It’s Boom Times for Santa

For Many Wall Street Bankers, This Year’s Bonus Season Is a Bust

Why New Year’s Eve Revelers Will Find Fewer Places to Party in Times Square

BlackRock’s Pitch for Socially Conscious Investing Antagonizes All Sides

YouTube Paying Roughly $2 Billion a Year for NFL Sunday Ticket

Elon Musk Says He Will Not Sell More Tesla Stock for About Two Years

Meta Agrees to Pay $725 Million Over Cambridge Analytica Scandal

SBF’s $250 Million Bail Is One of the Largest in US History. It Doesn’t Mean He Has That Much

Bankman-Fried’s ‘Epic’ Legal Battle

Top Executive for Financier Greg Lindberg Pleads Guilty to Charges Related to Insurance Fraud

Be sure to follow me on Twitter.

Morning News: December 22, 2022
Posted by Eddy Elfenbein on December 22nd, 2022 at 7:04 am

Without a Covid Narrative, China’s Censors Are Not Sure What to Do

Zelenskiy Wins Applause, Aid in Half-Day Dash Through Washington

Investors Trapped in Russian Bonds Find Saviors in Kazakh Buyers

How Changing Diets Leave Us Exposed to War, Extreme Weather and Market Turbulence

Oil Prices Rise, Extending Rally, After Decline in U.S. Inventories

Japanese Homeowners Face An Unfamiliar Headache: Higher Mortgages

Home Sales Dropped 7.7% in November

Biden and Congress Still Haven’t Made Inflation Central in Budget Matters

Fed’s Balance Sheet Drawdown Could Sunset Next Year

Bankman-Fried Associates Flip as FTX Co-Founder Arrives in NYC

All The Ways That Crypto Broke in 2022

A New Chat Bot Is a ‘Code Red’ for Google’s Search Business

Microsoft Gambles on ‘Nice Guy’ Strategy to Close Activision Megadeal

Tesla Dangles $7,500 Discount in Rare Move to Boost Deliveries

Elon Musk’s Distraction Is Just One of Tesla’s Problems

The End of Netflix Password Sharing Is Nigh

Sports and Fashion Won Big Together This Year

What Will Happen in 2023: All the Latest Predictions for Next Year

Be sure to follow me on Twitter.

Morning News: December 21, 2022
Posted by Eddy Elfenbein on December 21st, 2022 at 7:02 am

Russia and Iran Are Building a Trade Route That Defies Sanctions

Italy Backs Levy on Payments Firms, Banks If They Do Not Cut Fees for Retailers

Japan Bends to Global Forces Pushing Up Interest Rates

S&P 500 Facing a Historical Warning Sign After This Year’s Slump

Big Changes to 401(k) Retirement Plans Move Ahead in Congress

Jamie Dimon Is More Crucial Than Ever to the Bank He’s Run for 17 Years

High Commodity Prices Feed a Boom in the U.S. Farm Belt

Many Hospitals Get Big Drug Discounts. That Doesn’t Mean Markdowns for Patients.

3M to Stop Making, Discontinue Use of ‘Forever Chemicals’

Bans on TikTok Gain Momentum in Washington and States

Elon Musk Plans to Step Down as Twitter Head After Casting Doubt on Poll

Musk Says Cost-Cutting Averted $3 Billion Twitter Shortfall

Meta is Building Virtual World Open to App Makers, CEO Tells Antitrust Court

Core Scientific Files for Bankruptcy. Crypto Miners Are at Rock Bottom.

Nike: Huge Q2 Earnings Beat

Google’s YouTube in Talks for Rights to NFL Sunday Ticket

Phoenix Suns, Mercury Valued at $4 Billion in Record NBA Deal

Wells Fargo to Pay $3.7 Billion Over Consumer Banking Violations

Be sure to follow me on Twitter.