A few random observations, charts and factoids to provide some context on what is going on in the world.
G-7 Leaders Are Unloved
If you need confirmation that people around the world are confused and unsettled about what is going on around them look at this comparison of approval ratings of the leaders of the various G-7 countries.
All of these leaders met in Japan earlier this week.
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| Source: https://www.nytimes.com/2023/05/20/world/asia/g7-leaders-biden.html |
What I find incredible is that Biden actually has the second highest approval rating in the group.
It is also sobering that in all of these "democratic" societies that not one of the leaders currently has the approval of a majority of the citizens.
Doesn't it raise the question as to what they are all agreeing to do on behalf of their people?
Apple and Nvidia
The market capitalization of Apple has reached $2.75 trillion.
It is the most valuable corporation in the world.
Apple now represents 7.4% of the entire S&P 500 index.
Even more interesting is that the value of Apple is greater than the market cap of the entire Russell 2000 index (small cap stocks).
This is despite the fact that Apple's revenues are only 16% of those of the Russell 2000 companies.
However, Apple's net income is over 80% higher than all of the profits of the Russell 2000.
Apples's market cap is about 7 times the size of its annual revenue (price/sales ratio).
On the other hand, Nvidia, which had a blow out earnings report this week, propelled by its work involving artificial intelligence, saw its market value increase by $200 billion just yesterday.
How big a move is that ONE DAY increase?
It is bigger than the TOTAL MARKET VALUE of 472 of the 500 companies in the S&P 500 index.
That means that Nvidia now has a current price/sales ratio of of almost 35----five times that of Apple.
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| Credit: https://companiesmarketcap.com/nvidia/ps-ratio/ |
Nvidia's earnings from AI may ultimately justify that stratospheric stock price. However, that is extremely unlikely. Stocks like Amazon and Tesla once had similar price to sales ratios but there are many, many more companies that could not grow revenues and profits fast enough to meet the expectations of their stock price long term.
Whenever I see something like this unfold in the stock market I consider the words of former Sun Microsystems CEO Scott McNealy who provided this sage advice over 20 years ago when talking about the challenge of meeting the expectations of stock prices in the tech sector gone wild in the 2000 dot.com craze.
This interview came after many of those high flyers came back to earth, including his own company, which had a price/sales ratio of around 10 at the peak of the market.
At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don’t need any transparency. You don’t need any footnotes. What were you thinking?’— Scott McNealy, Business Week, 2002
Will we be saying the same thing to Nvidia shareholders a few years hence?
What were you thinking?
Florida, Texas, California and New York
Florida finished with a record $22 billion budget surplus for its 2022 fiscal year.
Texas is projecting a $33 billion surplus for its 2023 fiscal year.
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| Source: https://www.texastribune.org/2023/03/13/texas-budget-surplus/ |
Neither have state income taxes.
On the other hand, California is looking at a $32 billion deficit in the current fiscal year
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| Source: https://www.bloomberg.com/news/articles/2023-05-12/california-s-newsom-releases-revised-224-1-budget-proposal-for-next-fiscal-year |
The state of New York reported a modest surplus for its recent fiscal year ending March 31.
However, personal income tax collections fell by nearly 17% compared to the previous year.
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| Credit: https://twitter.com/BarbarianCap/status/1661886908534751232 |
California has a top personal income tax rate of 13.3% and New York tops out at 10.9%
In New York State, 46% of the personal income tax comes from the top 1% of earners.
In California, the top 1% are carrying over 47% of the total burden.
Then there is this.
When people move they also take their money with them.
It makes you wonder who is going to be left to pay the bills in Los Angeles, San Francisco and New York?
LGBT By Generation
Is it something in our food, water or air?
Did climate change cause this?
Has biology evolved this much within just a few years when we saw nothing like this for thousands of years?
What would explain this massive difference in how people identify by generation?
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| Source: https://news.gallup.com/poll/389792/lgbt-identification-ticks-up.aspx |
Interestingly, a lot of this change has only been true with young women.
in 2008, 93% of 18-29 old women identified as heterosexual.
In 2022, only 65% did.
However, the sexual orientation of young males has not changed much.
In 2008, 97% of 18-29 men said they were straight. That number was 94% in 2022.
All of this might explain this chart.
Is this another reason for men to identify as women?
Your odds might actually be better in finding someone to partner up identifying as a woman?
You also have this working for you in the athletic realm.
You can be a 14-15 year old high school freshman or sophomore male track star who nobody has ever heard of.
Or you can be the "women's" world record holder in almost any event you can think of.
These boys are not even close to being fully developed males either.
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| 14-15 year old boys high school track records vs. women's world records Source: https://twitter.com/monitoringbias/status/1656722279907065861/photo/1 |
How exactly is the LGBT agenda advancing the female (and human) species on this planet?
It is hard for this woman to comprehend.
Can anyone make sense of any of this?
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