Bob Elliott
@bobeunlimited
CIO @ Unlimited | Fmr Bridgewater IC | Described as one of the few "sane" voices on #fintwit (or is it #finsky?) | Comments are not investment advice
"Its been a good earnings season." Reminder that's not a useful statement. The question is whether its on pace to hit a 26% growth rate by 4Q.
Where is my manufacturing renaissance?!? Oh wait it's right there at 1% y/y growth if I just squint hard enough...
Big guys get that diversifying manager views is the way to better return consistency. But why pay these guys 2 & 20 (or more!) to effectively create fund of funds when you can get it at much lower fees through replication? www.bloomberg.com/news/article...
Will consumers keep their nominal spending growth at near 7% (today's retail sales print) with 3% income growth and no stimmies on the horizon? Never happened at such an extreme for more than a couple quarters in history.
Quarterly beat and drop is a sure sign of just how extreme investor expectations have become in this AI mania.
The Real Problem with US HH Demand Households stretched in 1H26 just to maintain real spending as prices surged. Any (modest) relief may come from falling gas prices is more likely to be socked away in 2H26 than spent on a new bender. bobeunlimited.substack.com/p/the-real-p...
Another exciting milestone for Unlimited! full press release here: www.globenewswire.com/news-release...
Relative to bonds, the equity run of the last decade has been more extreme than '00 and '29. h/t @thedailyshot
Anyone else get this Schwab "offer" following Fidelity's lead demanding issuers pay 15% of fees in exchange for no ticket charge & data? Has to be paid either by the investor or squeeze (already tight) issuer margins. Either way such onerous fees are a bad outcome for investors.
Very high expectations coming into this earnings season. Nice report from @sonalibasak icapital.com/insights/inv...
The most hawkish rhetoric in the minutes since 2022 this week, back when 1yr inflation swaps were >4%. Methinks the new Fed chair doth protest too much...
After all the tariff nonsense the US trade balance is pushing back toward post-covid lows once transitory factors are adjusted.
That sagging feeling across assets is the drag from supply and it's just getting started. As a reminder, financial asset prices in aggregate peaked on the 85bln Google equity issuance announcement.
Sure oil prices fell recently, but most folks don't realize just how reliant that has been on continued strategic inventory drawdowns b/c Hormuz never really fully opened. At this pace weeks away from using up this crucial source of supply
Companies are trying to juice already extraordinary consensus earnings growth expectations to keep the mania going. It's the sort of thing that typically only comes after recessions, not at an equity market peak. h/t @thedailyshot
It's about time that allocators stop thinking of these folks as "masters of the universe" with perfectly balanced factor exposure and start recognizing that while their vies have alpha, it surely ain't worth the 2&20 fees for it when similar cheaper options exist. buff.ly/aTWCt59
A big reason households were able to dissave in the first half was because of outsized refund checks. Without it, will they keep up the same nominal spending in 2H26? h/t @thedailyshot
Anyone notice data center construction growth has slowed a lot over the last year?
Another triangulation that the informal is experiencing much weaker job conditions than the payrolls numbers would suggest.
Very weak small business hiring intentions run directly counter to the view that labor markets are heating up. And these biz are 50pct of US employment. h/t @thedailyshot
Feel like Takaichi's plan is not getting nearly enough attention. If Japan can accomplish even half of this over the next decade it would provide a notable boost to GDP, not to mention beneficial second order productivity impact. h/t @thedailyshot
In order to get a reasonable IRR on 5tln in US AI-related CAPEX planned by 2030, total revenues on that capex need to get to a 3-4tln annualized run rate. 4tln in revenue / 160mln US workers = $25,000 per employee.
A pretty damning indictment of the limited real world producitivity benefit from LLM spend.
Once you include the informal workforce (measured in the HH survey, not payrolls), job growth looks far weaker than many realize.