Succinct Summation of Week’s Events 11.1.19 (plus A Take Back on Warren Buffett)

Below is the standard weekly summation that Barry Ritholtz publishes every Friday evening on his blog "The Big Picture" and that I republish every Sunday evening on my blog "MariasCap".  The positives this week are one less terrorist leader in the world, GDP and personal income rising, and payrolls coming in at a +128K instead of the expected +90K.  The negatives again revolve around the doubts that surfaced about concluding the trade war even though this summary may have been written before the Chinese new media rebuffed that story on Friday, a rebuff that sent the Dow soaring over 300 points. 


The bonus this Sunday night is going to be a little different for I am offering a take back on yesterday's post about starting an easy ETF by simply mimicking Warren Buffett's holdings as reported last week by U.S. News.  When I looked into it a little more deeply, I could not find any data supporting the claim that Buffett's portfolio was so heavily weighted with Phillips 66 stock. That should have been a red flag. No investor, certainly not one of Buffett's stature, would put all their eggs in one proverbial basket like that.  And even if you take the data at face value that Buffett owns 5.5 million shares, at Phillips stock price that is still well under 1 billion dollars, nowhere near the 600 billion reported. (Possibly it was a misprint and they meant $600 million, but even that would not be correct.) 

It's a simple lesson on not taking anything at face value and it appears that even U.S. News doesn't get all its reporting right all the time.  But that doesn't change the base theme that investing in the same portfolio isn't a good idea.  But even though Berkshire Hathaway costs 6 figures per share, there has for some time now been a "B" class stock that sells for only hundreds.  So I suppose yesterday's strategy is still useful with the minor modification of buying fractional shares in the "B" class.  Hope everyone had a great weekend. 


Succinct Summation of Week’s Events 11.1.19

November 1, 2019 4:30pm by Barry Ritholtz

Succinct Summations for the week ending November 1st, 2019

Positives:

1. One less terrorist in the world: US Special Forces kills ISIS founder and leader Abu Bakr al-Baghdadi
2. Non-farm payrolls rose 128k m/o/m, above the expected increase of 90k.
3. Real GDP came in at an inflation adjusted 1.9% for Q3, above the expected 1.7%.
4. Unemployment rate came in at 3.6%, meeting expectations.
5. Personal income rose 0.3% m/o/m, meeting expectations.
6. Pending home sales index rose 1.5%, above the expected increase of 0.7%.
7. Same store sales rose 4.5% w/o/w, above the previous increase of 4.3%.

Negatives:

1. Chinese officials cast doubts on reaching a comprehensive long-term trade deal with the U.S.
2. Layoff announcements came in at 50,275 in October, up from the previous 41,557.
3. Jobless claims rose 5k w/o/w from 213k to 218k.
4. ISM Mfg Index came in at 48.3, 1 point below the expected 49.3.
5. Wholesale inventories fell 0.3% m/o/m, below the expected 0.2% increase.
6. Consumer confidence came in at 125.9 in October, below the expected 128.8.
7. Chicago Fed National Activity Index fell by 0.45 m/o/m, below previous increase of 0.10.