Jake Burger comes off as a happy guy. And he was extra happy Sunday.
Burger's injury-riddled pro baseball career has presented an awful lot of challenge for the former first-round pick. But finally, after years without getting to play baseball, he was back on the diamond.
There's just one thing that was bugging him.
"The first thing I said to (White Sox shortstop Tim Anderson) after my first at-bat, I looked up at the scoreboard and I was like, 'I need to get that picture changed,'" Burger said. "I’m 40 pounds down from that picture. I really want a new picture."
Indeed, Burger has become the "after" in a weight-loss ad, 40 pounds trimmer than he was when that "before" picture was taken in a past spring.
The White Sox will surely work on getting an updated shot of the svelte Burger on the Jumbotron at Camelback Ranch. It's the least they can do after all the work Burger has put in to get back on the field.
It was that very field on which Burger first tore his Achilles tendon back in 2018. Then, while rehabbing that injury, he tore it again. Along the way, he incurred another setback, with his heel. His 2018 and 2019 seasons were wiped away. Due to COVID-19, there were no games for him to play in in 2020, either.
It's been an offseason-long talking point that Andrew Vaughn, the organization's top prospect, has only played in 55 minor league games in his less than two years in the White Sox system.
Burger's played in fewer, just 51 games, despite joining the organization two years earlier.
"It was a special moment today," Burger said after Sunday's game. "I kind of broke down in tears on the way to the field for the first day (of camp). So this is just another milestone in the comeback. It feels great to be out there with the guys and just playing baseball again.
"(Being back in a game,) it kind of told me that I belonged. Those injuries are well behind me, and I’m back to playing baseball and belong there.
"There’s always going to be that self doubt if I lost anything, and I didn’t feel like I lost anything at all. I think I got stronger. Today was a huge day for me."
Evaluating Burger's spring is different from evaluating that of anyone else in White Sox camp. Though manager Tony La Russa mentioned Burger's name among the young players competing with Vaughn for the team's DH job, it seems Burger is ticketed for the minor leagues to get more reps under his belt after so much time away.
Who knows what the future holds, as the White Sox are set at Burger's position, third base, with Yoán Moncada signed to a long-term contract. Vaughn seems to be the frontrunner for the DH gig and could soon find himself a fixture of the big league lineup for years to come. José Abreu is the reigning AL MVP and not budging from that first-base spot for at least the next two years.
But rather than worry about how he fits in at the major league level, Burger is happy to even be a puzzle piece, the experience of his return to action and participation in camp far outweighing the results for the 24-year-old.
"I’m just trying to have fun and play baseball," he said with a smile. "I missed three years of that, so it’s one of those things where I’m just happy to be here.
"Trying to take in as much information as I can and have fun with the guys again. Take good at-bats. It’s as simple as that."
Last summer, after kids had been locked down in their homes for the first few months of the pandemic, the chance to escape to summer camp had them revved up like a NASCAR engine.
"By the time that we opened, kids were just like, 'If you just want me to stand under this tree for 30 minutes, I'm going to do it,'" says Sam Green, director of auxiliary programs at Baylor School.
Last year wasn't like other summers in recent memory, with a plethora of camps from which to choose. Some camps canceled their entire summer season after COVID-19 delivered a gut punch to the world. There just wasn't enough time to totally revamp everything to make sure kids were safe. Those camps fell back and spent the time between that summer and this to develop safety plans.
Others scrambled to DEFCON 4, rearranging, rescheduling, revamping, basically rethinking everything to be able to hold last year's camps — sometimes shorter and with fewer attendees — while keeping kids safe from the virus.
As this summer looms, with COVID-19 surging and no end in sight, critical lessons learned last year are lessons to be used again this year.
"We were like, 'OK, let's think of this in a non-COVID year. What does this look like? And now let's back up and think about a COVID year. What do our capacities look like? What are the cleaning requirements for that? Do we need extra staff?'" Green says.
The mantra of "safety first" may be overworked to the point of background noise these days, but officials at summer camps in the Chattanooga area say it's the foundation of everything they're doing in 2021.
Temperatures will be checked before entering day camps or when kids wake up at overnight ones. Rapid-result testing will be used to check for positive cases if a kid or counselor exhibits possible symptoms. The number of kids allowed has been reduced, making it easier to practice social distancing, which is required everywhere. Masks at camp are a no-argument reality.
At Chattanooga Theatre Centre's Summer Academy, where students learn acting, staging, costuming and other performance aspects, masks got very little pushback, says Education Director Chuck Tuttle.
"You can't tell the adults anything, but kids are great," he says. "I did have some trouble, but most of the time I just had to say, 'Put your mask back on.'"
Even with masks, St. Andrew's-Sewanee School ditched last year's entire summer camp schedule. So did the Tennessee Aquarium.
"We just had to make the decision by April to just cancel it," says Elizabeth Duncan, director of auxiliary programs and special events at St. Andrew's who handles programming for the school's camps.
Aquarium officials came to the same conclusion, says Director of Science Education Brooke B. Gorman. Hamilton County Health Department guidelines made everyone nervous about keeping attendees safe, so Aquarium representatives canceled all camps, she says.
"As we approached late spring, we felt it was important to allow parents enough time to make alternate child care plans if we were not going to be able to run camp," Gorman says. "We made the very tough decision first to cancel June camps and later to cancel July camps as well."
Camps at both St. Andrew's and the Aquarium are back this year. The Aquarium also hopes to join forces with Reflection Riding Arboretum and Nature Center, which reduced both its number of day camps and the number of kids last year. By partnering, Reflection Riding can offer outdoor camps if the number of COVID-19 cases in the Chattanooga area reaches a level too high for an indoor camp, Gorman says.
At Baylor, things are returning to "a more normal schedule," according to Green. In 2020, the school offered four weeks of camps in 16 different activities. This year, the plan is to run 10 weeks of camps, with 60 options during the day and four overnight camps, she says.
"What we offered in 2019 is kind of mirrored in 2021," she says. "We've got some more outdoor options to make sure kids are getting outside."
Sports camps to be held outdoors include baseball, cheerleading and golf. Camp Walkabout, the overnight camp canceled in 2020, is taking place, too.
"We are blessed with a 690-acre campus, so we get to put kids everywhere and have them separated. We were really lucky in that aspect when we decided to replan," says Green.
Photo Gallery
What will summer camp look like this year? We checked in with Chattanooga-area camps
Inside sports such as wrestling and volleyball are again taking place, along with enrichment camps in pottery, theater, rocketry and woodworking, among others. Whether they're inside or out, kids will stay with their own group throughout the day, and the number of students in each group is limited, Green adds.
CTC's Summer Academy takes place completely inside the theater center, Tuttle says, so social distancing is key. During lessons, students must stand in circles that have been drawn on the floor to ensure six feet of distance. Poles also are used — to measure, not poke — to make sure distancing is maintained, he says.
Despite the cooperation of students, CTC's classes have been reduced to one in the morning for fourth- through seventh-graders and one in the afternoon for eighth- through 12th-graders. Under that arrangement, lunch is canceled.
"They have to take their masks off to eat lunch, and you cannot keep them apart," Tuttle explains. "That's their downtime, and they go kind of bonkers on you. It also gave us a chance to clean everything."
For camps that embraced the trend of telecommuting, lunch, masks and social distancing were irrelevant last year.
Officials at St. Andrew's-Sewanee were hugely disappointed after they'd decided to host their first overnight camp. It would run for 17 days and attendees could pick, among other choices, mountain biking and pottery classes, making music on banjo or guitar, cooking lessons, and woodworking. It was brand-new. It was exciting. It was energizing.
Then it was March 2020, and it all went away.
"We were just getting our feet underneath ourselves. We just had to make the decision by April to just cancel it," Duncan says.
The school canceled all of its day camps, too.
A virtual camp was put together that took place through Zoom meetings for several weeks, but it just wasn't the same, she says.
"By that point, kids were just Zoomed out, right?"
This year, St. Andrew's plans to hold the new overnight camp canceled in 2020, and officials are hopeful the day camps can return as well.
Getting back to a familiar schedule is important for kids who missed camp last year and also have been squirreled away for months on end, says Gorman. So this summer, camps are bringing back the activities from 2019 and keeping the 2020 safety measures in place.
"We know that, after the past year, summer camp 2021 is likely to be a time that kids can start to feel a bit of normalcy," she says.
Even with the extra sanitation required and the reduced number of students allowed, at most camps, any price hike seems to be marginal. Overnight camps may raise prices somewhat because, compared to campers dropped off in the morning and picked up in the afternoon, expenses are higher when kids need places to sleep, food to eat and regular COVID-19 testing.
Baylor School has not raised its prices for day camps since 2018, Green says, but Camp Walkabout has increased.
"The demand for the camp and requirements it takes to run those sessions safely and effectively, evermore so now with COVID, requires a bump every now and then. In a time of COVID, we want to be mindful of our pricing and how it would affect the families that we serve," she says.
CTC has raised its Summer Academy fee $10, but Tuttle doesn't expect that to be an issue.
The price ranges at the Aquarium have gone up in some cases and down in others, Gorman says. There has always been a difference between members of the Aquarium and non-members, she notes, but there are price hikes in a few cases.
"For people who have had several kids go to camp across the years, they may see that going to a specialty camp for younger kids is more expensive than what they are used to, but that a general camp for older kids is less expensive than what they are used to. The overall range of prices is the same as previous years, though," she explains.
With its inaugural overnight camp canceled, St. Andrew's is in something of a pickle when it comes to pricing, says Duncan. "We are in — yet again — a unique situation."
Since this is the first year for the 17-day camp, there's no comparison to previous ones, so St. Andrew's is using other camps as a tool to set its prices.
"We have priced our camp to fall within the average for summer camp," Duncan says. "We did have to factor in the cost of arrival testing and potential surveillance testing during camp, which added slightly to the cost."
Registration for most camps started in January, so numbers are not too reflective of the ultimate number of parents that sign up, but Green says that so far, Baylor's sign-ups are about the same as in 2020. However, the real flood starts in mid- to late March, she says, and she expects parents are looking forward to this summer as much as the children.
"I think parents are excited to be able to send their kids somewhere safe for a couple of weeks," she says.
A: I've lived here long enough to know never say never until mid-April, but I don't see it in the foreseeable future. We are now in a very spring-like pattern.
HIGH PRESSURE THIS WEEK
The dominating force of our week will be high pressure. This stable air will allow for abundant sunshine most days, and a warming trend throughout the week.
Monday will be sunny with highs near 50º.
Tuesday will be sunny with highs in the middle 50s.
Wednesday and Thursday will be sunny with highs near 60º.
Friday will have more clouds possible as a system develops to our west. At this time we don't expect rain on Friday, or through the weekend.
Another area of high pressure will move in for the weekend, allowing for more sunshine.
LOOKING AHEAD
If you are deciding between this week or next week for outdoor activities... and you're looking for dry time... this week may be better.
A more unsettled, moist pattern may be introduced next week with more clouds and more rain or thunderstorms.
Temperatures are expected to remain above average.
This is different than the vernal equinox, which occurs on March 20.
Meteorological seasons are based on temperatures, not strictly the position of the sun.
Meteorological spring arrives Monday and while you may be itchy for warmer weather, you may wonder why this is happening weeks before the vernal equinox.
After a stretch of record-smashing cold and repeated rounds of snow in February, spring couldn't come soon enough for those impacted by crippling power and water outages in Texas and surrounding states.
It turns out, spring is already here, at least according to meteorologists.
The arrival of spring you've probably heard about before is known as the vernal equinox.
That's the moment in time when the sun's most direct rays are shining on the equator. In 2021, the vernal equinox will occur on Saturday, March 20, at 5:37 a.m. EDT. If you're an early rise on a weekend morning, you can observe that this year.
Its counterpart in fall, the autumnal equinox, and also the summer and winter solstices, all occur in late September, June and December, respectively, due to the tilt of the Earth's axis as it revolves around the sun.
This changing sun angle through the year is why we have so-called astronomical seasons.
The orientation of the Earth relative to the sun at the northern hemisphere's vernal (spring) equinox, summer solstice, autumnal equinox and winter solstice.
(NOAA/NWS)
Why do meteorologists stray from those seemingly concrete definitions?
It all has to do with temperatures.
When you examine average daily high and low temperatures through the year, you'll quickly notice a pattern.
The coldest three months of the year in the Northern Hemisphere are usually from the beginning of December through the end of February, while the warmest three months are typically from the beginning of June through the end of August.
These nice, clean, three-month buckets are known as meteorological winter and summer, respectively.
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And these clean three-month temperature buckets don't line up nearly as well with the astronomical seasons, for example late December through late March.
A generic, sample trace of average high (red) and low (blue) daily temperatures the year. The coldest three months of the year are known as meteorological winter. The hottest such three months are meteorological summer. The transition between those two are meteorological spring and fall.
(NOAA/NWS)
In fact, Alaska-based climatologist Brian Brettschneider calculated that the Dec. 1 - Feb. 28 meteorological winter is a better fit to the coldest time of year in most of the United States and Canada.
In an analysis of dozens of U.S. cities, Brettschneider found only Honolulu, Hawaii, had its coldest 90-day stretch extend deep into March.
For those that live in the northern U.S., this makes sense.
It seems a little silly when we say "winter is here" just days before Christmas, when many parts of the north have already had at least one significant snowfall or cold snap.
Meteorological spring - March 1 through May 31 - is the transition between the three coldest and three warmest months of the year.
Another advantage to meteorological seasons is the ease of calculating seasonal statistics, since every meteorological season starts on the first of the month.
A March of Increasing Daylight, Temperatures
Most of the U.S. will pick up a full hour of evening daylight when daylight saving time arrives on March 14.
Even if there wasn't daylight saving time, most areas in the northern U.S. would gain an extra 30-45 minutes of sunlight in the evening by the end of March. More southern locales would typically only pick up 15 to 30 minutes of additional evening daylight during the month, if our clocks didn't spring forward.
Sunset times on March 1 (prior to daylight saving time) and March 31 (after daylight saving time) in 2021 for various U.S. cities.
(Data: NOAA; Table: Infogram)
While March has a well-earned stormy reputation, including winter storms in the West and northern U.S., with the sun gradually shining higher in the sky, average high temperatures typically rise about 10 degrees in the Midwest, Northeast and Plains by month's end.
Daily average high temperatures on March 1 and March 31 in several U.S. cities. The largest change in temperatures during the month occur in the northern U.S., particularly the Plains and Midwest.
(Data: NOAA; Table: Infogram)
The Weather Company’s primary journalistic mission is to report on breaking weather news, the environment and the importance of science to our lives. This story does not necessarily represent the position of our parent company, IBM.
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'Meteorological Spring' Arrives Monday. Here's What That Means and Why It's Different Than the Equinox | The Weather Channel - Articles from The Weather Channel | weather.com - The Weather Channel
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Donald Trump says he has no plans to launch a new political party, telling a conservative conference in Florida that it would split the Republican vote.
In his first speech since Democrat Joe Biden became president, he also hinted that he might run for office again in 2024.
Mr Trump strongly criticised his successor, saying US policy had gone from "America first to America last".
The speech comes weeks after Mr Trump was acquitted in an impeachment trial.
His appearance at the Conservative Political Action Conference (CPAC) in Orlando on Sunday represents his continued influence over the Republican Party.
Reuters
The mood of the conference - which began on Thursday - has been extremely pro-Trump, with loyalists including Texas Senator Ted Cruz and his son Donald Trump Jr among the speakers.
The former president remains banned from social media platforms, including Facebook and Twitter, over his response to January's deadly riot at the US Capitol.
He has been living at his Mar-a-Lago Florida golf resort since leaving the White House.
What did Donald Trump say?
The 74-year-old former president was cheered by supporters when he appeared on stage at the Hyatt Regency Hotel more than an hour late. Many people in the crowd were not wearing masks.
"I stand before you today to declare that the incredible journey we began together four years ago is far from over," he said.
"We are gathered this afternoon to talk about the future - the future of our movement, the future of our party, and the future of our beloved country."
He dismissed any idea that he might start a new political party - describing rumours he would do so as "fake news".
"Wouldn't that be brilliant? Let's start a new party so we can divide our vote and never win," he joked.
"We have the Republican Party. It's going to unite and be stronger than ever before."
Despite losing November's presidential election and being deeply criticised over the January riot, reports suggest Mr Trump remains extremely popular among his voting base.
In his CPAC speech, Mr Trump repeated his false claims that he lost November's election to the Democrats because of electoral fraud and he hinted at another run in 2024, saying: "Actually you know they just lost the White House. But who knows - who knows? I may even decide to beat them for a third time, OK?"
He excoriated the new administration, criticising Mr Biden for reversing his hard line on immigration and border security.
"We all knew that the Biden administration was going to be bad but none of us even imagined how just how bad they would be and how far left they would go," he told the cheering crowd.
Trump grasps for new lines in Biden era
Donald Trump is back. After a month out of the public eye, the former president picked CPAC's friendly confines to launch his bid for political revival.
Judging from the crowd here, not much reviving - at least among conservative activists - will be necessary. Their support for Trump - through electoral defeat, through the January mob attack on the US Capitol, through all of it - never flagged.
So when Trump made his bid for continued leadership of the party - as a king-maker and, perhaps, its standard-bearer in 2024 - the crowd gave its full-throated approval.
For the ex-president's potential successors in the party, however, there was a glimmer of opportunity on Sunday. Trump's speech was lacklustre by his standards. His self-imposed exile may have taken a toll - leaving him grasping for lines that work in the Joe Biden era. And while approval of Trump's policies was sky-high in a straw poll of CPAC attendees, only just over half said they would vote for him if he ran in 2024. It's a daunting advantage, but perhaps not prohibitive.
Trump's continued influence within the party seems secure, but translating that influence into another presidential nomination - if he wants it - is no sure thing. He'll have to earn it.
Republican lawmakers remained largely loyal to Mr Trump during his time in office but 10 voted to impeach him in the House of Representatives last month and seven voted to convict him in the subsequent Senate trial. The overall tally, 57-43 in favour of his guilt, fell short of the two-thirds margin needed to convict him.
Senator Mitch McConnell, the top Republican in Congress, criticised the former president's actions after his acquittal - declaring Mr Trump "practically and morally responsible" for provoking the riot, despite personally voting against his guilt on the incitement charge.
The schism in the party has remained since, with those who have broken rank against him notably absent from the CPAC stage.
The conference, which began in 1974, is seen as the most influential gathering of US conservatives and a barometer of the Republican party's political direction.
Generation Investment, which former vice president Al Gore co-founded, bought Alibaba, Airbnb, and Equifax stock, and sold most of its stake in Aptiv in the fourth quarter.
Qilai Shen/Bloomberg
Generation Investment Management, the investment firm co-founded and chaired by former vice president Al Gore, recently made some significant changes in its U.S.-traded stock investments.
Generation initiated investments in Alibaba Group Holding (ticker: BABA) and Airbnb (ABNB) stock, bought more shares of credit-reporting firm Equifax (EFX), and sold most of its holdings in auto-parts supplier Aptiv (APTV). The firm disclosed the stock trades in a form it filed with the Securities and Exchange Commission.
Generation, which had assets under management of $30.7 billion at the end of 2020, declined to comment on the investment changes.
The firm bought 1.5 million Alibaba American depositary receipts in the fourth quarter. It hadn’t owned any ADRs of the Chinese online giant at the end of the third quarter.
Alibaba ADRs rose 9.7% in 2020, and they are up 2.2% so far this year through Friday’s close. In comparison, the S&P 500 index, a broad measure of the market, rose 16.3% last year, and is up 1.5% so far in 2021.
Airbnb stock’s IPO was in December, and priced shares at $68 each. Generation bought 200,000 shares of the online platform for property rentals.
Airbnb stock more than doubled from its IPO price by the end of 2020, and so far in 2021, it is up 40.6%.
Aribnb stock surged after reporting its first quarter as a public company. Earlier this month one analyst downgraded Airbnb stock, and wrote that he “couldn’t justify” the lofty valuation of the shares. Airbnb’s successful IPO could nudge rivals to look at ways to unlock value.
Equifax stock soared 37.6% last year, but has slid 16.1% year to date.
Equifax’s fourth-quarter report earlier this month topped expectations, and Credit Suisse analyst Kevin McVeigh wrote in a research report that the company’s reintroduction of a share-buyback plan supports a bull thesis on the shares. McVeigh rates Equifax stock at Outperform with a $215 target price. Needham analyst Mayank Tandon, who also has a $215 target price, and a Buy rating on Equifax stock, wrote that HR services unit Equifax Workforce Solutions as “a strong tailwind for growth.”
Generation bought 3.6 million more Equifax shares in the fourth quarter to lift its holdings to 5.7 million shares.
The firm slashed its investment in Aptiv by more than three-fourths, selling 5.2 million shares in the quarter to end 2020 with 1.5 million shares.
Aptiv stock soared 37.2% in 2020, and year to date it is up 15.0%.
Inside Scoop is a regular Barron’s feature covering stock transactions by corporate executives and board members—so-called insiders—as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.
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February 27, 2021 at 07:00PM
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Al Gore’s Investment Firm Bought Alibaba and Airbnb Stock. Here’s What It Sold. - Barron's
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New name, new course, same lucrative payday. Since their inception in the late 1990s, the World Golf Championships have accomplished the goal of bringing the game’s best players together on a regular basis. And they’ve done it, in part, by making it attractive for them to do so.
The 72 golfers competing at this week’s WGC-Workday Championship (the event’s fifth different title), held in 2021 at The Concession Golf Club in Bradenton, Fla. (it’s eighth different venue), were eyeing an overall prize money payout of $10.5 million. Sunday’s winner, Collin Morikawa, earned $1.82 million.
Yes, PGA Tour pros play for a lot of money a lot of the time. But if you think this isn’t an insignificant figure, consider this: Before Morikawa closed out his three-shot victory with a final-round 69, that $1.82 million amounted to more than 23 percent of his previous career earnings ($7.683 million to date in thre 24-year-old's nascent career)
For Billy Horschel, who sat two shots back of Morikawa at the start of the day and played with him in the final pairing, the $1.82 million would have been the biggest single tournament paycheck in his 13 years playing as a pro on the PGA Tour. It would have been the second biggest payday ever for Webb Simpson (who was three shots back of Morikawa to start the day), behind only the $1.9 million he made at the 2018 Players Championship (and $400,000 more than his 2012 U.S. Open payday).
Indeed, save for Brooks Koepka (T-2), Rory McIlroy (T-5, four back) and Patrick Reed (T-5), every other remaining player in the top 10 entering Sunday would have cashed his largest single prize money payout of his careers if he’d won.
Here’s the breakdown of the payouts for every golfer competing this week.
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February 28, 2021 at 08:56PM
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Here's the prize money payout for each golfer at the 2021 WGC-Workday Championship - Golf Digest
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Where are we in this bond-related selloff? Are we one-third through? Two-thirds? Or are we where we need to be to start buying?
As I have said I have studied all the rate scares we have had in the last couple of decades and this one is pretty much following the form of those where the Fed feels pressure to raise rates off a very low base.
These scares all have the following in common:
Inflation by some measures seems out of control. In this case it is lumber, which has doubled in a year; copper, which is really Chinese demand, up above $4; and oil, which is north of $60. They are visible and they are saying the Fed must act.
There are a considerable number of stocks that have been created that do best with stable rates like we have and these stocks have become toxic because they are being viewed as dangerous places as they have no real earnings or sales. These kinds of stocks need low inflation for a long-term pay-off and they aren't getting that.
The Treasury is under assault for spending too much. Here we have the huge stimulus package coming at a time when the pandemic seems to be running its course because of science. But spending is often at the heart of these scares.
We get shortfalls from the higher rates that the Fed doesn't control.
Now, before I get to each one, I want to remind you that all of this is happening in a bond-market vacuum. If you read Warren Buffett's letter this weekend you can see unbridled capitalism and how little these four points mean. They are noise to him, and I don't even think he hears it although his jarring $11 billion write-down of Precision Castparts is a reminder that no one is immune to "the moment." Buffett paid $32 billion for this excellent aircraft parts company six years ago. It was a high price at the time, too high as Buffett admits.
Still, the takeaway of Buffett's letter, as always is that if you take a long term view things will work out on balance and this time, he did not chastise anyone for trying to do it at home. Thank you.
Now let's deal with the matter at hand. There are many investors, particularly new investors, who do not get the interrelation between bonds and stocks. Too make it easy there are three intersections. First, rates going higher make for competition to stocks and some would say that already the average stock's dividend stream is threatened by the bond fixed-income stream because of the "big" move in rates. I think this is canard. Bonds are still very unattractive. Again read Buffett if you disagree. Second, interest rates, per se, are a signal of the future and the future is that we are going to have inflation and inflation is bad for stocks. Explaining why it is bad is a little like explaining why a football team is bad. It loses a lot. You lose a lot in stocks when inflation's bad. The third is the hardest: ticks up in yield trigger algorithms that drive down individual growth stocks while stabilizing cyclical stocks. The latter can't go higher because of the downward pull of S&P futures from big macro funds that want less exposure. But the cyclicals are in favor and, because of years of dormancy, there are very few of them and they don't equal even a tenth of the growth stocks out there. They can't lead.
So, where are we? I don't want to dismiss the most bullish of cases: the last ten minutes of Friday were horrendous and yet rates didn't go higher so it is possible we are further along than we think.
But I think that is too optimistic. We haven't passed the stimulus yet. The Fed hasn't been pressured for what happens when that money gets distributed and we are fully vaccinated. Only the variants, the malicious variants, can derail the vaccination plan and I think that they won't be as serious only because our scientists are one step ahead of the posse now.
So what happens then?
I think that when we have these scares no one has enough money on the sidelines to take advantage of them and your co-shareholders are your enemy. They don't want to sit tight, a la Buffett, perhaps because they are in options or because they are on margin or because they think the market is rigged or they don't understand the bond market interplay.
What they don't understand is that even though rates are low even a minuscule move versus the 13% of forty years ago or the 7-8% of so long in the 90s, means that, on a percentage basis big money get scared.
Plus, we are not yet at the moment when Jay Powell gets asked a question about what happens when everyone gets vaccinated and he says "you know what, we took rates to zero a year ago, it's time to let them go higher."
Until you hear that you have to keep some powder dry. Notice I didn't say "if you hear that." At a certain point it would be pointless to keep rates down if the economy is growing and ten million people get hired back.
So, the long answer is that this scare will not end until Powell breaks with his current view.
That means we could have some real pain ahead for some stocks.
What kind of stocks?
Five different kinds.
First, there's the companies that did well last year that might not do as well this year. You are seeing this right now, in real time, play out with Costco (COST) - Get Report and Walmart (WMT) - Get Report. I know some are gripped with the higher labor costs these companies are taking on. Others are concerned that now non-essential retailers are back these companies have to be doing worse.
I say that's why you have already had such a swift decline. Walmart is only 13 points up from where the pandemic began. Do you think it is worth less than that moment even as so much of its competition has now been destroyed? Of course not. Same with Costco. These are two amazing companies with stocks that will go higher over time because they make so much money. That's not even fathomable right now for some of the sketchy holders. So you can bet that, like a Clorox (CLX) - Get Report , these companies will see their stocks flirt with charts that would indicate that there's been no value created. We are buying them for Action Alerts PLUS because it is simply untrue that they are worth less than when the pandemic began.
So, I am saying that some stocks have already neared where they are going to go and just need one more swift leg down that might happen too fast to buy.
Then there is a second cohort, the Salesforce (CRM) - Get Report /Workday (WDAY) - Get Report group. These are companies that are beginning to really have some amazing sales at a time when it's pretty unimaginable for that to happen. These are deferred revenue businesses so most could not see the breakout both companies had versus the last few quarters. Are the selloffs absurd? Not at all. Not when rates are busting higher. The big worry here, if you use the 2015-2016 paradigm, will be when one of this cohort misses and blames the economy the way LinkedIn did back then. I don't see that happening so the declines of 30-40% are not going to happen, IMO. Which means, again, that this group is a buy when we have the swift leg down that I am expecting, when Powell is pressured too heavily and says the magic words. The stocks will bottom ahead of that, but we aren't there yet.
Third group: companies that are SUPPOSED to benefit from higher rates. I don't want you to even think for a second that they actually will. The only stocks that go up in a scare like this are pure commodity stocks like copper companies and they go up until either China, the main client, stops buying or we get more mines to open, which is happening now. The stocks that people SAY will go up will be the cyclicals and the banks but that's a canard. When rates go higher and the Fed doesn't follow banks make a little extra on your deposits but inflation will obscure that until earnings are reported. The cyclical rally will not last because too many people will worry about missed numbers because rates are going higher. These companies are crummy leaders anyway. There are too few of them.
Fourth, higher yielders. These have to come down to levels where the yields are even higher before they are less risky to own. You can watch Pepsi (PEP) - Get Report or Coke (KO) - Get Report or Pfizer (PFE) - Get Report or Merck (MRK) - Get Report and you can see what's happening. American Electric Power's (AEP) - Get Report a good pain proxy, too. You can't see it, but you know it is happening. I like this group right here because it is now starting to overcompensate. That's because there's a reshuffling toward stocks that do better when the economy opens -- only a handful -- and these stocks are the fuel for that move. Lower still, though, is the watchword, but not much lower.
Then there is the final group, the newly minted companies and the companies based on the hope of EV or alternative energy or SPACs that have found companies but the SPACs are overvalued relative to the companies -- Churchill Capital IV (CCIV) - Get Report -- Lucid Motors being front and center. I don't have any idea how low these can go. There are too many of them. They aren't followed. They are truly part of the Wall Street hype machine. Some can hold up because they have a good concept: check out Fisker(FSR) - Get Report . But it is case by case and a lot of money is still to be lost here.
I know that I am not tracing out a scenario that makes things worth buying. But I do think that the group that bottoms first will be the Salesforce high-growth with earnings sector. Why? Because every scare ends with these stocks going higher, which is why you have to pay attention to them and start buying them, actually now as they tend to anticipate everything I just wrote.
Remember, I am not trying to give you hope, just history. But history is almost never wrong. I think it won't be wrong this time either.
