Discover more from The Sunday Drive by Mike Allison
Sunday Drive - 07/31/2022 Edition
👋🏻 Hello friends,
Greetings from Saratoga Springs! Take it easy and enjoy this week's leisurely Sunday Drive around the internet.
The vibe of the week is Elton John's Rocket Man. My wife and I just missed getting to catch him at Gillette Stadium in Foxboro, MA this week as part of his (delayed by Covid) Farewell Tour.
This song holds a special significance for me. In 1997, I was at an AT&T meeting for investment analysts in NYC. The company unveiled a new TV commercial that featured Rocket Man and showed a man on a business trip who wanted to, but could not, get back to his family.
In a "life imitates art" moment, later that night, I called my wife to check in and say goodnight. That is when she told me about the loss of the baby. It was very early in her pregnancy, but we'd been trying to start a family for several years so it was pretty devastating for both of us. I was able to get back home to her early the next day, but I can tell you that every time I hear this song, I remember that helpless feeling and reflect on it. To paraphrase a verse from the Bible (Job 1:21) - the Lord giveth, and the Lord taketh away. What He soon gave us were two beautiful, amazing children, a girl and a boy, that would not be the wonderful young adults they are today if we had not lost our first baby.
Music has great power to help us remember important moments in our lives, and that is why it's important to me to always include a Vibe of the Week in the Sunday Drive. What songs are important in your life?
Quote of the Week
" To be wealthy, accumulate all those things that money can’t buy."
Chart of the Week
The Chart of the Week shows that over time, 20 or more years, stocks have historically always had positive returns. Adjusted for inflation, the same can't be said of bonds or treasury bills. Despite much more volatility over shorter investing periods (see the left most bars), this highlights the importance of patience, a long investment horizon, and the willingness to stay the course.
💭 Thought Bubble of the Week
This section of the Sunday Drive is intended to serve up seedling ideas which may ultimately grow into more fully developed pieces to be published on NewLanternAdvisors.com. I'd be most grateful if you'd share any thoughts, suggestions or feedback.
The S&P 500 index had a good week, up nearly 4.5%, and reminded us that volatility can also sometimes be to the upside. As Q2 earnings reporting season progresses, it appears that the economy and corporate earnings aren't falling off a cliff, at least not yet. Weakness? Yes. But not a disaster. It also seems that the slightly negative Q2 GDP numbers that were reported this week gave the market confidence that the Fed might not be as "behind the curve" in their fight against inflation as previously feared.
Time will tell if my previous speculation of a brief and shallow recession, with a more negative impact on corporate profits than employment, will pan out.
🤔 The Semantics of a Recession - Metrics aren’t what we think they are. The market/economy is not what we think it is as the pandemic-war-supply-chain-meltdown shifted how things work, and thus should really shift how we measure things. The lens through we view our world *quantitatively* is kind of… archaic.
📉 No, we're not in a recession but somehow this economy feels worse - Our economy right now is a little…different from recessions of yesteryear. Why? Well, because it feels like we’re conflating the idea of a recession (true GDP contraction, high unemployment, etc.) with our experience of relatively high (but not historically high) inflation and relative slowing after a ton of money printing and the last decade’s abnormally low interest rates.
💡 Mark your diaries: the human longevity revolution is coming - Aging populations can be a challenge, but they're a huge opportunity too. By 2030, spending by senior citizens will make up 10 percent of global GDP.
🤓 The home of the future may generate its own electricity - The "smart home" of the future may be fully or partially energy self-sufficient, equipped with a charging station that not only powers your electric vehicle, but could serve as a backup generator if the electricity goes out.
💪🏻 Metamaterials Expand Possibilities in Biomedical Engineering - Our bones – like our fingerprints – have their own unique set of identifiers, including mineral density, volume, and skeletal structure. This makes it tricky to create a one-size-fits-all approach for repairing and preventing fractures, especially for cancer patients who experience bone tumors that cause debilitating damage to their long bones and spine. But a biomedical engineer and an aerospace engineer have teamed up to explore how structural metamaterials may offer some solutions by preventing fracture before it happens.
I hope you have a relaxing weekend and a great week ahead. See you next Sunday...
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