Final Week Of The Year

Good Morning Everyone!

Except Southwest Airlines, which canceled 2,500 flights yesterday and lost track of everyone's bags.

Their stock is down nearly 5% pre-market.

Prices as of 4 pm EST, 12/23/22; % YTD

MARKET UPDATE

4 trading days left in 2022

• Global stocks worst annual performance since 2008:

China lifts inbound travel restrictions

• Quarantine requirements to end January 8

• Ends nearly 3 years of zero-Covid policy

• Cases still high - winter outbreaks

Crude 79.9 +0.75%

• 3-week high on China easing

• Extreme weather in US → supply disruptions

  • Weather forecast to improve this week…rally killer?

4.4% = consumer 1-year inflation expectations (UMich)

• Lowest since June 2021

• Five-year expectations 2.9%

• Inflation uncertainty remains too high for comfort:

2.4% = Personal savings rate

• Consumers still have some pandemic cushion

+5.5% = PCE YoY

• +0.1% in November

• Lowest since July

• Sticky services:

-2.1% = Durable Goods Orders in November

• Biggest drop since April 2020 (Covid)

  • -0.6% expected

• Business investments rose unexpectedly

+5.8% = New home sales in November

• Another surprise jump

  • -4.7% expected

• Homebuyers took advantage of dip in mortgage rates

• However…different story when accounting for cancellations:

• Also different story YoY…9 straight months of annual declines:

Southwest Airlines (NYSE: LUV)

• Extreme weather

• +2,600 flights canceled yesterday (80% of flights)

• LUV responsible for nearly 3/4 of US cancellations

  • Airlines have canceled 17k US flights since Wednesday

• More cancelations ahead

Earnings

• None

CRYPTO UPDATE

Weather affects crypo: Bitcoin (CRYPTO: BTC) hash rate suffers big drop

• Fell 38% over the weekend as miners powered off (aka curtailment)

• Winter storm = high electricity costs

• Curtailment way for miners to help electricity grid

Bitcoin miners will need to be meteorologist nowdays as well.
Severe winter weather in North America impacted the biggest mining pool Foundry with approx 20 EH being switched off.
Another confirmation that bitcoin's geographical diversification is vital! pic.twitter.com/snk36JX0w1

— Denis Rusinovich (@DenisRusinovich) December 25, 2022

Mark Cuban doubles down on Bitcoin 

• Wants prices to drop further to buy more

• Says gold bugs are “dumb as f***”