DHUnplugged #604: Fed Engineered Recession

Fed decision imminent. Global slowdown - is now the time to cool the rate hike discussion a bit? It is the worst start of a year since..... PLUS we are now on Spotify and Amazon Music/Podcasts! Click HERE for Show Notes and Links DHUnplugged is now streaming live - with listener chat. Click on link on the right sidebar. Love the Show? Then how about a Donation? Follow John C. Dvorak on Twitter Follow Andrew Horowitz on Twitter Warm Up - Secret - Not First Time Rates Up - Markets getting crazy - Maybe it is not just the rates. (Reality Check Time?) - Fed coming out with their latest rate decision tomorrow - 1000 point days, 500 point turnarounds - the norm now? - Some earnings news.... Market Update - Mixed bag - Amazon crash, Facebook Rallies (general story this quarter) - THIS IS A FED ENGINEERED RECESSION - Worst start to a year since....   (April Awful!) - USD 20-year high against Yen Andrew's Idea for the Fed - Raise rates by 0.50% tomorrow - Instead of range (0.75 -1.00) just make it 0.75% - Stress that inflation is high alert item, BUT watching other items and how they impact economy - Tamp down hard line a touch, but continue to note inflation concerns, blended with economic concerns - Risk is to upside for markets (slightly) as many positioned for very hard line (aka priced in) Free Range No More - Organic and free-range chickens have been thrown into lockdown. - Egg-laying hens that normally have access to the outdoors can no longer roam as freely or feel the sun on their beaks as some U.S. and European farmers temporarily keep flocks inside during lethal outbreaks of bird flu, according to egg producers and industry representatives. - Free Range seems to be just a nice thing..... ------The U.S. outbreak is the second-worst in history, with more than 35 million birds wiped out this year. France has culled nearly 16 million birds in its worst outbreak ever, while infections have also hit nations including Britain, Italy and Spain Earnings of Interest - The online education company saw its shares plummet 39.2% in premarket trading after it cut its revenue outlook, saying current economic conditions are prompting consumers to prioritize "earning over learning." - Pfizer reported a first-quarter profit of $1.62 per share, 15 cents a share above estimates. Revenue topped forecasts as well. The drugmaker cut its full-year outlook due to an accounting change. Pfizer shares fell 1.3% in premarket action. - Facebook/Meta - Stock rallied hard after soothing investor's worst fears that it had become irrelevant (cutting back on spending by ~ $3 billion also helped) - LYFT - earnings okay, outlook okay - big spend - - plans to invest more in driver supply to improve service levels and in other business initiatives. (Stock down 30% A/H) - Starbucks - good report - but big investment coming to catch up to unmet demand. ----- Pulled guidance as no visibility due to China lockdowns - AMD - BIG Quarter - server business picked up and reports that they have a good outlook related to supply chain to meet guidance. (up 7% A/H) Crypto ATMs Crypto ATM Media Collapse - Vice Media, the digital media company once valued at $5.7 billion, has hired bankers to seek a sale, according to people familiar with the matter. - Paramount - sales fall - Disney + what going on - Netflix - Numbers in reverse - What is up with this? Explain - Analyst worried about bubble - huge collapse potential - "There's probably a lot more downside to go," said Suzuki, who's also a former Bank of America-Merrill Lynch market strategist. "Information technology, communication services and consumer discretionary... alone make up about half of the market cap of the S&P 500." - Yet, Suzuki is staying invested in stocks. - To weather a potential crash, Suzuki is taking a barbell approach. On one end, he likes stocks which typically benefit in an inflationary environment,