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Presidential Election Preview Call Tomorrow

Takeaway: There are many factors weighing on the outcome of the upcoming election. Get all the facts by listening to our Presidential Election Call.

Based on the major impact U.S. policy has on global financial markets, our Macro Team, Financials Team, and Healthcare Team will join forces and dissect the most likely scenarios leading into and out of the 2012 Presidential Election.

 

 

CONFERENCE CALL DETAILS 

  • Wednesday, September 19th  
  • 11 a.m. EST
  • Participant Dialing Instructions:
    • Toll Free Number:
    • Direct Dial Number:
    • Conference Code: 324541#
  • Materials will be distributed prior to the call

Presidential Election Preview Call Tomorrow - obama romney 300x200

 

Our Global Macro research process at Hedgeye focuses on three key factors: growth, inflation, and policy.  As our Director of Research, Daryl Jones, has noted, the policy and/or perception of future policy is often the most critical factor to handicap.  In the United States, the President, and his or her party (if they control Congress) have the power to set the economic agenda and fiscal outcomes.  Moreover, they appoint the Federal Reserve Board which has increasingly-politicized control of monetary policy.

 

For additional information regarding this call or any other upcoming Hedgeye event please email .  

 

"In America, anybody can be president. That's one of the risks you take."

-Adlai E. Stevenson


Devaluing The Dollar

Takeaway: Unless central planners change, the dollar is likely to continue falling further.

Often we discuss how Ben Bernanke and the policies of the Federal Reserve have destroyed the US dollar and driven up food and fuel prices. The correlation risk involving the dollar is strong no doubt, with yesterday’s slide in oil attributed to a move in the dollar and rumors of the Strategic Petroleum Reserves opening up. But just how far has the dollar fallen in the past three months? Take a look at the chart below for your answer:

 

Devaluing The Dollar - USD 3mo


CHART DU JOUR: TAXI ME TO THE TABLES

The correlation between taxi trips and table play on the Strip

 

  • The correlation between the YoY change in taxi trips and non-baccarat table drop is 0.68 over the past 5 years
  • Since we get taxi and airport data 2-3 weeks before the state releases gaming stats and both are statistically significant variables in explaining gaming volumes, they are major inputs in our monthly projection model
  • August taxi trip data was released today and it was down 1.7%.  We don’t yet have the McCarran airport data but assuming no surprises, gaming revenues could be flat to slightly down with normal hold.

CHART DU JOUR: TAXI ME TO THE TABLES - vvv


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Hedgeye Heads to Houston: Hedgeye Energy Corporate Access Trip

Takeaway: Get an Edge in the Game, Talk to the Leaders

Hedgeye’s Director of Research, Daryl Jones, and Energy analyst, Kevin Kaiser, are traveling to the oil and gas capital of North America, Houston, TX to gain insight on the current energy environment from the leaders of top E&P and oilfield services companies.

 

Below is the current schedule, please email if you would like to be a part of this expedition or would like additional details.

 

Hedgeye Heads to Houston: Hedgeye Energy Corporate Access Trip - TX  Sch


Chinese Rebar Prices Rebound

Takeaway: Chinese rebar may have bounced but it'll be short-lived as it continues to drop in price heading into 2013.

We’ve examined the relationship between Brent crude oil and the price of Chinese rebar as the price of rebar fell nearly 50% over the last year. Though there is a significant bounce in September pricing, we believe it’s nothing but a dead cat bounce and that rebar prices will continue to fall.

 

The spot rebar price is +7% off the September 7 low, coinciding with the rip in most risk assets after the ECB announced its new bond-buying program.  That makes intuitive sense – Europe is China’s #1 export customer.  China likely has a bunch of steel it can’t get rid of or we’re not getting the entire picture.

 

 

Chinese Rebar Prices Rebound - china rebar


Industrial Indicator: NAV Losing Ground

Takeaway: $NAV's heavy discounting may not be sustainable with less efficient operations. An end to discount would help competitors, including $PCAR.

 

Trucks per Employee: NAV Losing Ground

  • Efficiency: Trucks per employee is an interesting measure of efficiency and capacity utilization.  On that measure, NAV is losing ground while PCAR is gaining.  Absolute numbers are impacted by the high percentage of smaller Class 5-7 vehicles produced by Navistar.
  • NAV Discounting Heavily: NAV’s product and regulatory issues have resulted in reduced market share, even with discounting to maintain sale volumes.  Lower sales rates relative to competitors can create negative feedback in the form of higher costs and increasing losses.  In turn, higher costs make NAV’s discounting more difficult.
  • Unsustainable: Customer perception of product quality and OEM financial stability is important for truck sales, in our view.  Navistar’s problems may not yet be over, particularly if Volvo and Daimler again sue the EPA over revised non-conformance penalties.

Industrial Indicator: NAV Losing Ground - truck per employee

 

 

Industrial Indicator: NAV Losing Ground - perf 9 18 12


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what smart investors watch to win

Hosted by Hedgeye CEO Keith McCullough at 9:00am ET, this special online broadcast offers smart investors and traders of all stripes the sharpest insights and clearest market analysis available on Wall Street.

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