States Begin to Drop Orders For Masks in Public Settings

 Nine states outlined plans this week to roll back requirements that people wear masks at indoor venues—including businesses and, in some cases, schools—as Covid-19 case numbers decline and pressure to return to normal life rises.

Officials in New York, Illinois, Massachusetts and Rhode Island said Wednesday that rules requiring masks or proof of vaccinations intended to curb the spread of the Covid-19 pandemic would end by March. Earlier in the week, California, Oregon, New Jersey, Connecticut and Delaware officials made public similar rollbacks.

All of those states voted for President Biden in the 2020 election and are now not following recommendations from the federal Centers for Disease Control and Prevention, after previously hewing to guidance to continue requiring face covering indoors and in schools.

“The Covid clouds are parting,” New York Gov. Kathy Hochul, a Democrat, said after announcing requirements to wear masks in restaurants and offices would lapse on Thursday.

Federal public-health officials said Wednesday that they are considering changes, but continue to recommend mask-wearing in public indoor settings in much of the country.

Why 7% Inflation Today Is Far Different Than in 1982

 Consumer price inflation in December, at 7%, was last this high in the summer of 1982. That’s about all the two periods have in common.

Today, the inflation rate is on the rise. Back then, it was falling. It had peaked at 14.8% in 1980, while Jimmy Carter was still president and the Iranian revolution had pushed up oil prices. Core inflation that year reached 13.6%.

Upon becoming Federal Reserve chairman in 1979, Paul Volcker set out to crush inflation with tight monetary policy. In combination with credit controls, that effort pushed the U.S. into a brief recession in 1980. Then, as the Fed’s benchmark interest rate reached 19% in 1981, a much deeper recession began. By the summer of 1982, inflation and interest rates were both falling sharply. Four decades of generally low-single-digit inflation would follow.

“We have had dramatic success in getting the inflation rate down,” one Fed official observed that August. But Mr. Volcker had other problems to contend with: His high interest rates had pushed Mexico into default, touching off the Latin American debt crisis, and unemployment would climb to a post-World War II high of 10.8% that fall.

Unemployment took out that record in the early months of the Covid-19 pandemic in 2020. Since then, it has been falling rapidly as the economy roars back thanks to vaccines, fewer restrictions on mobility and ample fiscal and monetary stimulus. In December, unemployment sank to 3.9%, closing in on the 50-year low of 3.5% set just before the pandemic.

Monetary policy then and now couldn’t be more different. Back in 1982, the Fed was still targeting the money supply, causing interest rates to fluctuate unpredictably. Today, it largely ignores the money supply, which expanded dramatically as the Fed bought bonds to hold down long-term interest rates. Its main policy target, the federal-funds rate, is close to zero.

Rather than 1982, two previous episodes when inflation reached 7% might hold more useful lessons for today. The first was in 1946. The end of the war had unleashed pent-up demand for consumer goods, and price controls had lapsed. Inflation reached nearly 20% in 1947 before falling all the way back. Today, consumption patterns have similarly been distorted and supply chains disrupted by the pandemic.

The Federal Reserve is expected to take a very big step toward its first rate hike

 The Federal Reserve is expected to announce a dramatic policy shift Wednesday that will clear the way for a first interest rate hike next year.

Markets are anticipating the Fed will speed up the wind-down of its bond buying program, changing the end date to March from June.

That would free the central bank to start raising interest rates from zero, and Fed officials are expected to release a new forecast showing two to three interest rate hikes in 2022 and another three to four in 2023. Previously, there had been no consensus for a rate hike in 2022, though half of the Fed officials expected at least one.

At the end of its two-day meeting Wednesday afternoon, the central bank should also acknowledge that inflation is no longer the “transitory” or temporary problem officials had thought it was, and that rising prices could be a bigger threat to the economy. The consumer price index rose 6.8% in November, and it could be hot again in December.

“I think getting out of the easing business is very much overdue,” said Rick Rieder, chief investment officer of global fixed income at BlackRock.

The Fed put its quantitative easing program in place to combat the effects of the pandemic in early 2020, and it also slashed its fed funds target rate back to zero.

Stocks making the biggest moves premarket - GME AMC BYND TSLA

 GameStop (GME) – The videogame retailer – one of the so-called “meme” stocks – lost another 3.1% in the premarket following a nearly 14% tumble yesterday to its lowest close since March. GameStop had seen its stock slide last week after reporting a wider quarterly loss.

AMC Entertainment (AMC) – The movie theater operator’s stock slid 6% in premarket trading, after extending a losing streak to 3 days with a more than 15% plummet Monday. Last week, CEO Adam Aron sold all his holdings in AMC while CFO Sean Goodman sold the bulk of his AMC stock.

Beyond Meat (BYND) – The maker of plant-based meat substitutes saw its stock jump 4.8% in premarket action, putting it in a position to break a 3-day losing streak. Piper Sandler upgraded the stock to “neutral” from “underweight,” saying a nationwide launch at McDonald’s (MCD) could happen within less than 3 months.

Tesla (TSLA) – Tesla shares slid 1.5% in premarket trading after CEO Elon Musk sold more of his holdings to cover tax bills generated by the exercising of stock options. Tesla has dropped more than 20% from its all-time high and its overall market value has fallen back under the $1 trillion mark.

China set to tighten foreign funding rules for tech companies

 

• China's crackdown on its technology sector looks set to continue following nearly a year of unwieldly regulatory efforts. It all began in November 2020, when Jack Ma's Ant Group was forced to cancel what would have been the world's largest IPO. Regulatory efforts then turned to data security and protection - with large fines imposed on Alibaba (NYSE:BABA) and food-delivery giant Meituan (OTCPK:MPNGY) - and culminated in a New York Stock Exchange delisting announcement last week by DiDi Global (NYSE:DIDI).
• The latest: China is said to be drawing up a blacklist that will make it harder for new technology companies to raise foreign funding and list overseas, FT reports. The blacklist could be published as early as this month, and would include startups that use a so-called variable interest entity structure, which are controlled by a company by means other than a majority of voting rights. VIEs have been used for decades by Chinese tech groups, such as Alibaba (BABA) and Tencent (OTCPK:TCEHY), to circumvent foreign investment restrictions and raise funds internationally.
• Prompting the decision is the Chinese Communist Party's move away from the proliferation of the private sector, to a more state-owned enterprise economy (or at least having more involvement and control of the business environment). Compared to prior decades, the new economic order is more concerned about the control of data and flows of capital vs. economic liberalization and reforms. The CCP is also fearful that foreign investment could lead to "disorderly capital expansion," which means that foreign interests influence what goes on inside China.

Do Hedge Funds Love The Boeing Company (BA)?

According to Insider Monkey's hedge fund database, Ken Griffin's Citadel Investment Group has the largest call position in The Boeing Company (NYSE:BA), worth close to $1.9354 billion, corresponding to 0.4% of its total 13F portfolio. The second most bullish fund manager is Renaissance Technologies, which holds a $329.6 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Remaining peers with similar optimism consist of D. E. Shaw's D E Shaw, Israel Englander's Millennium Management and Phill Gross and Robert Atchinson's Adage Capital Management. In terms of the portfolio weights assigned to each position Symmetry Peak Management allocated the biggest weight to The Boeing Company (NYSE:BA), around 8.17% of its 13F portfolio. Heard Capital is also relatively very bullish on the stock, dishing out 5 percent of its 13F equity portfolio to BA.

Visa launches crypto consulting services in push for mainstream adoption

 

• Visa said Wednesday it is launching an advisory practice to help clients navigate the world of cryptocurrencies.
• The payments processor hopes it can help further mainstream adoption of bitcoin and other digital currencies.
• Visa and its rival Mastercard see crypto as a key growth opportunity as they expand beyond card payments.

Boeing says P-E firm orders 30 additional 737 MAX jets

 

• Boeing (BA +2.2%) pops in early trading after saying 777 Partners placed an order for 30 additional 737 MAX jets, nearly doubling the P-E firm's original order.
• The new order lifts 777's commercial aircraft portfolio to 68 737 MAX aircraft, which are valued at $3.7B at list prices.
• "We have long been confident in the economics of the 737 MAX family but we are especially excited about the 737-8-200 variant which represents the bulk of our additional orders," says Josh Wander, managing partner of 777 Partners.
• The news extends yesterday's nearly 4% gain for Boeing, which surged alongside travel related stocks on early signs that the COVID-19 omicron variant may cause milder symptoms than previous strains.

Dow futures jump more than 300 points, continuing rebound as investors reassess omicron risk

 Stock futures jumped early morning Tuesday after a rebound from a rollercoaster week as investors grew less fearful of the potential impact from the new omicron coronavirus variant.

Futures on the Dow Jones Industrial Average rose 358 points, or 1%. S&P 500 futures rose 1.3% and Nasdaq 100 futures were up 1.7%.

Chipmaker stocks were the early winners, with Intel leaping 8.4% and NVIDIA up 3.7%, following news that Intel was planning to take its self-driving car unit, Mobileye, public in mid-2022.

Casino stocks also were hot, as Las Vegas Sands rose 3.4%, while cruise lines also gained on the enthusiasm that omicron may pose less of a threat than feared. Carnival and Norwegian Cruise Line Holdings jumped about 3.5% each.

Apply for Options Upgrade in TD

 1. In TD Web Login, search for "request Options Approval or Upgrade"

2. Look for Apply for Options page. It should be under My Profile -> General --> Apply for Options

3. Check current Options level, It should be at the highest level (Advanced)

4. During the application, 
4.1 In Investment Objectives, select growth and speculation
4.2 In Years of Experience, select 10+

5. Submit the application

6. It may take 3-5 business days for approval.