Early voting for the May 5, 2018 Salado ISD bond election will begin this coming Monday, April 23.
[Read more…] about Answers to questions about the Salado ISD Bond
Early voting for the May 5, 2018 Salado ISD bond election will begin this coming Monday, April 23.
[Read more…] about Answers to questions about the Salado ISD Bond
Once again, Mark Zuckerberg is sorry.
The founder of Facebook, who has apologized for privacy breaches throughout much of his company’s existence, is back at it, on a much larger stage than ever before.
The Markets
The U.S. stock market, represented by the S&P 500 Stock Index (SPX), turned in a respectable 1.99 percent gain for the week, closing at 2656.30. That still leaves it down 0.65 percent year-to-date, but up an impressive 14.06 percent from this time last year. Early in the week and again on Friday the SPX dipped on trade-war tweets, but in the end, it was solid earnings reports from financial companies that saved the day (week). Another upbeat item was the rise in oil prices, which translates into higher expected earnings for energy companies.
U.S. Crude oil futures for May delivery hit $67.39, up 8.6 percent for the week as tensions escalated in the Middle East. Gold rose 0.84 percent for the week and is up 3 percent for one year at $1,348.60. The 10-year U.S. Treasury note resumed its slow rise to close at 2.825 percent in the mid-range of recent yields. As a side note, Bitcoin, the wunderkind of speculators at the end of last year as it rose to nearly $20,000 was down into the $6-7 thousand range for the week, having lost nearly 70 percent year to date.
The Economy
One of the indicators that an economy is rapidly growing and may be reaching its limits can be seen in the transportation industry. Currently, just about all the long-haul 18-wheelers that are available are filled and their drivers are pushing the legal limits of time behind the wheel. Trucking companies ordered 139,900 heavy-duty trucks in the first quarter, nearly double the number from last year according to analyst group FTR. The group also reported that trucking companies are seeing a substantial number of orders above that which they can carry and are starting to charge premium fees in some cases.
In the first quarter, the number of truckloads of freight ready to move rose 27 percent while the number of rigs available rose only 14 percent. The negative to this good news is that increased transportation costs tend to get passed along creating higher prices, which creates inflationary pressures. While the rigs are in short supply, the drivers are already at 100 percent utilization, up from 85 percent three months ago. To get more drivers, higher wages will be required. The economy has hit its first bottleneck. It is in the bottlenecks where inflationary forces are brewed.
That bottleneck contributed to a rise in core inflation to a 2.9 percent annualized rate in the first quarter as measured by the Consumer Price Index (CPI). The Federal Reserve’s favorite measure, the Personal Consumption Expenditures Index (PCE) is now running at an annual rate of about 2.5 percent. Since the Fed has a target inflation rate of 2 percent, interest rates are likely headed up to slow the economy. Meanwhile, producer prices rose at a 3.6 percent annualized rate in March after increasing 3 percent from this time last year; another indicator of building inflationary pressure.
In an odd twist of events, as we reported last week, the aluminum tariffs targeted at China actually reduced the price of aluminum, but aluminum prices then jumped about 25 percent and alumina, the raw material, rose 30 percent as the administration imposed trade sanctions on Rusal, the Russian company that supplies about 7 percent of the world’s aluminum and alumina.
The Congressional Budget Office (CBO) announced that the federal deficit will hit at least $1 trillion dollars starting in 2020. The forecast included a warning that the interest payments on that debt will exceed the Defense budget by 2023 and become larger than all federal discretionary spending by 2025. The CBO also predicted that the U.S. economy would likely grow 3.3 percent for 2018 but then decline to 2.4 percent in 2019 and average 1.7 percent in 2023 and later. It appears more and more that the 2017 tax cut bill will boost economic growth in 2018 while generating a rise in inflation, at the expense of higher debt and a slower economy in the follow-on years.
The bottom line continues to be that the economy is in excellent shape with corporate earnings on track to continued growth. In the short term, the wild card remains trade tariffs. If the President’s announced tariffs and China’s counter-tariffs go into effect, those earnings estimates will need to be recalculated and with them the potential market gains. Longer-term, the combination of increased federal spending and revenue reductions may take us into a slump in late 2019 and for 2020. Stay tuned.
The Salado Rotary Club is a strong supporter of our school district. The Rotary Club provides scholarships for our graduating seniors.
[Read more…] about Salado Rotary Club supports Salado students
In February 2017, four teachers from Salado Intermediate School (Corey Baird, Colleen Gilchrest, Darcy Madsen, and Laura Tomlin) attended the Space Exploration Educators Conference (SEEC) at Johnson Space Center in Houston. They learned of an opportunity through ARISS, Amateur Radio on the International Space Station, in which students could have a live question and answer session with an astronaut aboard the ISS. A proposal, including a technical and education plan, was submitted in April 2017. By mid-June, ARISS announced that the Salado Intermediate School (SIS) was one of thirteen organizations in the United States that would make contact with the International Space Station in the spring of 2018.
[Read more…] about Students learn about stars, will talk to Space Station
President Donald Trump’s pick for CIA director is about to experience a good Borking.
No one doubts her professionalism, and she’s been endorsed by Obama intelligence officials. Yet Gina Haspel’s long career at the agency, including extensive work undercover in the field, is getting blotted out by her reported involvement in the CIA’s black-site interrogation program, which has become a warrant to say anything about her.
The Markets
The U.S. stock market, as represented by the S&P 500 Stock Index (SPX) closed out the week at 2588.26, marking the worst weekly decline since January 2016, down 5.95 percent for the week. From its high on January 26, the SPX is now down 9.91 percent, putting it within less than a tenth of a percent of the commonly-held definition of a “correction.” Shares of manufacturers, steelmakers, and aluminum producers led the decline with Century Aluminum down 19 percent for the week. United States Steel was down 13 percent and Caterpillar down another 5.6 percent.
Next Thursday, April 5, is the final day to register in order to be eligible to vote in the May 5 Salado ISD bond election.
The website to register is www.votetexas.gov/register-to-vote/
This week I am providing a few facts regarding our school district’s academics, finances, and growth.
[Read more…] about Some facts about Salado ISD academics, finances and growth
Our new agricultural science/FFA teachers, Kaleigh and Dean Black, are doing an outstanding job this year.
The Markets
The S&P 500 Stock Index closed out the week at 2572.01, down 1.24% from last week. It remains up 2.93% year-to-date, on track toward another double-digit year despite the week’s less than stellar performance. The big “if” and the reason for the weekly decline remains the fear of a global trade war following the sudden firing of what Wall Street considered the two voices of economic reason in the Trump administration. There is a pervasive concern that if the verbal jabs turn into a real trade war, the U.S. economy will suffer, prematurely ending the nine-year bull market.