Trump Addresses UN General Assembly
Bloomberg and other outlets this morning have analysis of President Trump’s debut speech in front of the United Nations General Assembly.
Highlights include claiming the United Nations is too tied up in “bureaucracy and process.”
Trump also said he was “prepared to take further action” regarding the ongoing political crisis in Venezuela.
Regarding North Korea, Trump said, “The United States has great strength and patience, but if it is forced to defend itself or its allies, we will have no choice but to totally destroy North Korea.”
Politico, The New York Times, CNN and others report Trump also favors a military parade down Pennsylvania Avenue in Washington, D.C. on July 4th.
Trump was impressed with a French display of military strength on Bastille Day upon visiting French President Emmanuel Macron in July.
Everything above is short to medium-term bullish for defense stocks, defense tech, and all the pick and shovel plays that benefit from military spending.
In other news…
It’s Almost Too Easy for Amazon
Toys ‘R’ Us filed for bankruptcy yesterday, eyeball deep in $5 billion of debt.
$444 million in debt was due in 2018, according to MarketWatch. The company says it has secured $3 billion to continue operations.
Downsize, restructure, go bankrupt. The result is the same for slow-moving legacy retail no matter how you go about it.
The endgame looks like Sears. A 5-year chart:
In fairness, it’s not just the “Amazon Effect” driving some retailers out of business.
Reuters reports this morning that a complicated real estate sale-leaseback gambit Toys ‘R’ Us undertook in recent months failed due to “accounting issues.”
$5 billion in debt will do that.
The writing’s on the wall for legacy big-box, big footprint retail. How America does business is changing before our eyes.
In other news, Hurricane Maria makes landfall in Puerto Rico this morning. The Washington Post reports Maria’s the first Category 4 storm to make landfall in Puerto Rico since 1932.
Market Rundown for Wednesday, September 20
S&P 500 futures are flat this morning at 2,505. Oil has broken through $50, sitting at $50.08.
Gold’s up over $7 at $1,317.
At 2 p.m. Eastern today, the Federal Reserve rate decision hits the airwaves, followed by commentary from Fed Chair Janet Yellen at 2:30 p.m.
The read is rates stay at 1.00% – 1.25% until at least December.
But, today’s also the day some expect the Fed to begin “unwinding” its $4.5 trillion balance sheet full of Treasurys and mortgage backed securities.
The experts call it a “technical adjustment” unlikely to have any market effect. We’ll see.
Existing home sales data comes first today, at 10:00 a.m.
Talk to you again on Friday.
For the Rundown,