MidSouth Week in Review:
September 06, 2019

Weekly Update from Fund Manager Buzz Heidtke, MidSouth Investment Fund

Sep. 9, 2019 | RedChip Companies

The S & P rose 1.7% during the holiday shortened week.  U.S. factory activity shrank in August for the first time since January 2016, a sign that the China trade war is affecting the economy.  Manufacturing accounts for 11% of the economy.  Household debt increased for the 20th consecutive quarter.  A J.P. Morgan study of 4.9 million checking accounts found that 17% of their income is used to repay debts.  The British pound sunk to a 34-year low of $1.196 before recovering to $1.23.  The pound was trading at $1.34 in March and $1.70 in 4Q of 2014.  The Dollar Index rose to a two-year high vs. major currencies world-wide.  We got lucky that the center of hurricane Dorian didn’t hit the U.S.  A few years ago I owned Universal Insurance (UVE), a heavily concentrated Florida-based casualty insurance company, that quickly dropped 50% when it appeared a hurricane would split the state.  Fortunately for me, the storm moved westward at the last minute.





7 Reasons Why You’ll Never Be Rich – You spend more than you make · You’re not investing · You have too much debt · You don’t focus on retirement · You live paycheck to paycheck · You don’t have an emergency fund · You have a negative mindset on money.  If you believe you’ll never be rich, you won’t – Anna Baluch, personal finance writer


Gentlemen – prefer bonds – Andrew Mellon


The Big Miss – In December 2018, 10 Wall Street strategists all predicted the yield on the 10-year T-notes would increase over the next year from its 2.68% level.  This week the 10-year traded at a yearly low yield of 1.46% vs. the 2018 high yield of 3.25% - Barron’s ….. Rates on credit cards are the highest in more than 20 years:  17.14% on average as of May – The Kiplinger Letter


Health – The higher a person’s fitness level, the lower their risk of mortality, especially from cardiovascular disease and cancer.  In a recent study, the least active women averaged about 2,700 steps per day; those who averaged just 1,700 more, a difference of about a mile, were 41% less likely to die of any cause – Abby King, Stanford University ….. iPhones have a free fitness tracker that comes with the phone that measures steps taken per day – Buzz


Recession Coming? – 40% of 226 economists surveyed in July believe the U.S. will fall into a recession by the end of 2020, while the remaining believe it will begin by 2021 – National Association for Business Economics


Online Betting – now accounts for 80% of all legal wagers on games in New Jersey, which surpassed Nevada in May on sports bets.  The value of illegal bets through neighborhood bookies and off-shore sites total around $150 billion annually.  NJ sports bettors wagered $3.2 billion last year.  Tennessee is expected to soon be the first state to test an online-only sports betting system – Wall Street Journal


Ouch! – Hong Kong residential real-estate sells at $2,091 a square foot vs. $985 in Paris, $776 in London and $526 in New York.  HK residential prices have quadrupled since 2003.  The average apartment price in Hong Kong sells at more than 20x median household income – Demographia


I’ll Just Lick The Seat – The floor of a public restroom has about two million bacteria per square inch vs. a toilet seat which has about 50 per square inch – New York Times ….. The bacteria on an elevator button is 40x higher than a toilet seat – Clean Sink


Teachers – In a recent survey, Fishbowl asked those in several professions if they had student loans.  Teachers jumped to the top of the list with 65% indicating they had the loans.  The group also have the lowest percentage (21%) who have paid back their loans.  Many teachers have turned to the Fed Loan Forgiveness Program for help which requires teachers to work full-time for five consecutive years at a qualifying low income school to be eligible – Financial Advisor


Delaying Social Security – A filer who was projected to receive $2,054 at 62, would receive $2,871 by waiting until 65 and $3,706 per month by delaying until 70 to receive benefits.  A surviving spouse typically receives the spouses’ benefit which would be for those who were early claimants.  For around $750 annually, a 62-year-old could obtain a $250,000, 10-year term-life insurance policy which could help offset the financial loss incurred by the family due to the early demise of one’s spouse – Buzz ….. https://Fidelity.com/SSCalculator - When you should claim Social Security benefits.




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