July 26, 2022
GM, Walmart, Unilever
- Earning misses, increased prices, slowdown in investment
bellwethers for the economy and all three are showing signs of recession.
GM posted a 40 per cent year-on-year drop in second-quarter income to $1.7bn, from $2.8bn in the same quarter last year. GM had previously revised down its revenue outlook for the second quarter after it was unable to deliver 95,000 vehicles because of a shortage of chips. (FT)
Even Raytheon (which has been selling Javelin and Stingers in bulk to the USA recently) is being hit by supply crunch. Raytheon recently got a $662mn contract for 1,300 missiles, before declaring that supply chains are drying up and increasing prices.
- Unilever raises prices 11% as it grapples with "unprecedented" costs
Roubini (depressed investor extraordinaire) says this is all not going to go well and says calls for mild recession are “totally delusional”. Which is fun to report.
Shallow Recession Calls Are ‘Totally Delusional,’ Roubini Warns
- A reason Roubini cites is historically high debt ratios
- This time it ‘could be worse than ‘70s,’ economist says (BN)
IMF World Economic Outlook
You can watch it live or read about it later.
Major point:
The baseline forecast is for growth to slow from 6.1 percent last year to 3.2 percent in 2022, 0.4 percentage point lower than in the April 2022 World Economic Outlook. (IMF)
Everyone thinks the economy is doing more poorly than it was in April, so maybe you don't really care what the IMF thinks. The reason that you should care is because it's numbers affect thinking about central bank rates.
Here is what the market thinks they will be:
UK Tories
- Tories are more racist than sexist.
- UK voters are more "we hate Thatcher" than racist.
Sure, that's a glib and unsophisticated analysis, but so are most Tories.
Regular voters thought they both did poorly:
Tory members just don't like Sunak. Sure, who can blame them. But, they do like Truss which makes them more than a little off.
Polls suggest Truss is the favourite among Tory activists; more than 150,000 party members will start receiving ballot papers next week and a new leader will be named on September 5.(FT)
Strikes await the winner, but not as many as there used to be:
Monkeypox
- New study out on MonkeyPox. Pretty definitive about what needs to be done and the threat that it faces.
- If you are male and have sex with men, it is a very good idea to get this vaccine.
- Supplies are low of the vaccine, which is partly the reason for the targeted roll-out.
The vaccine is JYNNEOS (aka: Imvamune)
Administered as two subcutaneous injections four weeks apart. The immune response takes 2 weeks after the second dose for maximal effect.
The Pharma companies note on effectiveness has caused public health officials to express concern about the lack of efficacy data for one dose of JYNNEOS in the current expanded outbreak, especially because it requires two doses 28 days apart.
One dose versus two doses effectiveness at stopping infection: 77.6% and 90.0% two weeks after doses given.
- 77.6% is not high enough for public health, but seems a tonne better than nothing.
- After two doses survival against a weaponized small pox attack is broadly better.
- It is recommended that IMVAMUNE not be given within 4 weeks of an mRNA vaccine for COVID-19.
See previous posts on why this entire thing deserves a poster of how we did not learn anything from COVID-19.
Capital and income
Ever wonder if we are still in capitalism where the rich get money while doing no work:
