MidSouth Week in Review:
March 12, 2018

Weekly Update from Fund Manager Buzz Heidtke, MidSouth Investment Fund

Today the bull market hit its 9^th year anniversary.  The NASDAQ, led by the big cap tech stocks,  made a new high today after Trump announced on Thursday, launching global tariffs on steel and aluminum while announcing more aggressive pressures to come, especially on China.  Canada and Mexico are exempt from the tariff changes for  now.  Household net worth rose to a record $98,746.  Household savings rates declined to 3.7% from 6.0% in 2016 and 7.2% in 2015.  The Russell 2000 small cap index rose 4% for the week, benefiting from the trade policy change, tax reform and a good jobs report.  The unemployment rate hit 4%, its lowest level since 2000.

BuzzBits

Home Prices – rose 5.4% in 2017.  Going forward, the new tax law may tap the brakes on home price growth, because it limits some state tax deductions.  Moody’s Analytics predicts that by 2019, home prices nationally will be 3.7% lower – Kiplinger Letter ….. Real-estate agents say this could be one of the weakest spring selling seasons in recent years.  The culprits: rising mortgage rates, a new tax law that reduces the incentives for homeownership and a growing weariness among first-time buyers being priced out of the market, all of which are expected to dampen demand for homes this year – Wall Street Journal

The $40 Million Mistake – Atlanta-based Delta Air elected to eliminate offering discounted tickets to NRA members, causing the state of Georgia to kill a $40 million tax break for the airline.  It was later discovered that only 13 passengers had ever bought a ticket with an NRA discount – USA TODAY ….. Google searches for NRA membership surged 4900% since the week before the Florida school shooting – Daily Mail

Self Sufficiency – The International Energy Agency has reported that U.S. crude production is projected to hit a record 12.1 million barrels a day in 2023 as a result of surging shale.  Output at this level would make the U.S. the world’s largest oil producing nation while also doubling American export capacity.  Further, this would mean 80% of the world’s demand growth for the next 3 years would be covered by U.S. shale, diminishing OPEC’s influence on the international oil trade – McAlinden Research Partners

Only at the Oscars – A female winner got to the stage and thanked her wife for her support followed by her male business partner who then thanked his husband for his support.

Smart Financial Planning – Trump’s chief economic advisor Gary Cohn and former Goldman Sachs president resigned Wednesday.  By taking the government job, Cohn was forced to sell as much as $240 million of his Goldman Sachs stock during the January 2017 to March 2017 period, at around $240 a share, just before the stock tanked to around $180 a share.  Also, a special break available to rich people picked to join the government, lets them cash out and defer their capital gains ….well possibly forever.  All they have to do is sell their stock to avoid conflicts of interest and then invest the proceeds in diversified funds - Buzz

Dreamers – In a recent study of 600 Millennials and GenX investors with over $100,000 to invest, almost a third (29%) of the Millennials expect their financial advisors to offer gifts or other favors in exchange for their business.  Some popular options includes meals, tickets to sporting events, sponsored social events and happy hours – Wealth Management

The Apple Scam – In early fall, I and many others mysteriously started seeing the battery life on our iPhones quickly dissipate each day.  Shortly thereafter, Apple introduced their iPhone X and 8, causing many users to upgrade their phones.  After being accused of introducing software that purposely reduced battery life to encourage purchase of the new phones, the company offered to replace batteries on the older phones for only $29.  Bingo!  The old phones with replaced batteries are now likely to go two days without a recharge.  The iPhone X lost 41% of its value, according to deduttr.com, in the first month after launch and 44% by February – Buzz ….. Smartphone sales declined for the first time in 2017, due to slumping sales in China – Wall Street Journal

Amazon – announced they are offering a 54% discount on their Prime membership to Medicaid recipients.  The lower income customers will receive the service for $5.99 or $7 less than the new regular month fee of $12.99 – Recode 

buzz@msifund.com

This material was prepared by MidSouth Investment Management LLC, and does not necessarily represent the views of the presenting party, nor their affiliates.  This information has been derived from sources believed to be accurate.  Please note – investing involves risk, and past performance is no guarantee of future results.  The publisher is not engaged in rendering legal, accounting or other professional services.  If assistance is needed, the reader is advised to engage the services of a competent professional.  This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty.  This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such.  This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested.  All economic and performance data is historical and not indicative of future results.  Market indices discussed are unmanaged.  Investors cannot invest in unmanaged indices. 

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