What we’re reading (8/29)
“How The Stock Market Can Ride An Economic ‘Hat Trick’ To New Highs Through Year-End, Even As The Threat Of A Correction Mounts, According To One Wall Street Chief Strategist” (Business Insider). “[I]f COVID-19 cases peak sooner than later, economic growth should begin to improve and force investor expectations higher, according to the note. Further, a weaker US dollar and further inflation could produce another bump higher for commodity prices. A rebound in economic surprises, a weakening US dollar, and rising commodity prices represents the trifecta of an economic hat trick that could power stock prices higher, according to [Leuthold Group strategist Jim] Paulsen.”
“Fed Faces New Challenge Spelling Out Employment Goals” (Wall Street Journal). “Assessing maximum employment, often described as the unemployment rate consistent with stable inflation, will be a delicate task for the Fed because officials concluded, in retrospect, that they overestimated it during the previous expansion and possibly raised interest rates too soon. Their deliberations figure to be more difficult now because of how the Covid-19 pandemic has upended normal economic activity—for example, by making it harder to determine how many people who left the labor force last year will return.”
“Wood You Look At That: Lumber Is Cheap Again” (Fortune). “What's going on? As lumber prices reached record levels this spring, many DIYers and builders simply stopped buying. At the same time, sawmills were upping production in order to cash in on the record prices. That, of course, was a prefect recipe for a correction. But now with prices still freefalling, buyers have little reason to jump back in. Thus that's why we've shifted all the way from a wood shortage to an oversupply. In a matter of three months, lumber has gone from exorbitant to relatively affordable levels.”
“OnlyFans And The Myth Of Owning Your Hustle” (Vanity Fair). “When OnlyFans, a social platform with over 130 million users, announced what essentially was a change in the company’s content guidelines last week, the backlash was swift…what OnlyFans’ betrayal of sex workers—followed by that abrupt reversal—[…] makes apparent is the central mythology undergirding the rising class of creator-driven platforms at large: the flawed belief that you, the creator, are ever the one in the driver’s seat.”
“Niall Ferguson On Why The End Of America’s Empire Won’t Be Peaceful” (The Economist). “[I]t is all too easy to see a sequence of events unfolding that could lead to another unnecessary war, most probably over Taiwan, which Mr Xi covets and which America is (ambiguously) committed to defend against invasion—a commitment that increasingly lacks credibility as the balance of military power shifts in East Asia. (The growing vulnerability of American aircraft carriers to Chinese anti-ship ballistic missiles such as the DF-21D is just one problem to which the Pentagon lacks a good solution.) If American deterrence fails and China gambles on a coup de main, the United States will face the grim choice between fighting a long, hard war—as Britain did in 1914 and 1939—or folding, as happened over Suez in 1956.”
