What’s up pain and the secret to falling asleep?

Dear Reader,


Money problems, the bears are coming, investing tips (not advice), conquering pain and falling asleep quick & easy.

 
Trouble with paying for the necessities. The economy is doing great, unemployment at a two-decade low, corporate profits at record highs, but 40% of people ages 18 to 64 are facing hardships. Much of the income earned is devoted to fixed expenses like rent or healthcare. If a large, unexpected expense arises, most people simply wouldn’t be able to cover it. Almost 25% of Americans experienced food insecurity last year: didn’t know if they’d be able to eat if they were hungry. The typical worker is making less while the cost of stuff has grown with real average hourly earnings down .2% last month compared with a year before. 
 
The bears are coming out of hibernation internationally. Emerging markets have officially entered a bear market, with Argentina, Turkey, and Brazil driving the downturn. The MSCI Emerging Markets index has dropped by 12.5% since May as investors fear increased interest rates and political turmoil. Many of the 23 economies in the index have a high amount of dollar-denominated debt owed in USD. This dollar-denominated debt grows when the Feds increase interest rates because rate hikes increase the value of the USD. As a consequence, what was once a cheap debt has now become a more expensive debt, and investors are in a panic because of it. Another driver of the emerging markets panic is the political inability of the 23 small governments to manage their own currencies. Many of the governments on the list do not have a central bank that has been increasing interest rates alongside the Fed. These governments are unable to keep up with the rising value of the USD, as seen in Argentina, whose currency is now valued at 37 pesos per dollar. Despite the turmoil, we see the panic as a buying opportunity.
 
Investing in the late-cycle. High volatility, expansion in its tenth year, US inflation at its target level… here are 3 investment opportunities for investing in the late-cycle:

1. Shorter-term US corporate bonds: attractive due to the Fed rate hikes and current credit spreads. The shorter maturity makes them less sensitive to higher interest rates.
2. Gold: attractive due to its recent underperformance relative to its historical average.
3. A basket of emerging market currencies: attractive due to their underperformance with the current risks.

 
Why the school day ends 2 hours before the workday. Both parents work in 50% of married-couple families and 70% of them work from 8am until 5pm. The 8-hour workday started in the early 1900s from labor unions pressuring corporations to be more lenient on the backbreaking schedules. But, the American school day never adapted. 19th-century school reformers wanted a nationwide, standard 6 and a half hour, 5 days a week school year schedule.
 
Why some feel less pain. Mindfulness is related to being aware of the present moment without too much emotional reaction or judgment. Mindful people feel less pain. People with higher mindfulness ratings had less activation in the posterior cingulate cortex (a central neural node of the default mode network) and experienced less pain.
 
On fire. The U.S. Department of Labor released their report today, in which they supported what Jerome Powell, Chairman of the Fed, said a few weeks ago. Basically, this economy is good. Really good. Some might even say it's on fire. The unemployment rate is still at 3.9%, which is one of the lowest we've ever seen. Non-farm payroll employment increased to 201,000 this past month, which is a fancy way of saying that the U.S. economy added 201,000 jobs. This number is higher than the estimated number of 196,000. Of equal or greater importance, the wage growth is at 2.9% over the past year. However, over the same time period, inflation also grew 2.9%. This leads to a pretty stagnant level of real growth. Moreover, some think that this period of intense wage growth and inflation at the same time is a precursor to the economy burning out, which would be bad, very bad. Interestingly, Kevin Hassett, Donald Trump's lead economist, reported that wage growth is even higher than what the Labor Department is reporting, as the department's report does not include certain benefits and bonuses among other factors.
 
The military secret to falling asleep in two minutes. Relax the muscles in your face, including the tongue, jaw and the muscles around your eyes. Drop your shoulders as far down as they’ll go, followed by your upper and lower arm, one side at a time. Breathe out, relaxing your chest followed by your legs, starting from the thighs and working down. Then spend 10 seconds trying to clear your mind before thinking about one of these images:

• You’re lying in a canoe on a calm lake with nothing but a clear blue sky above you.
• You’re lying in a black velvet hammock in a pitch black room.
• Say “don’t think, don’t think, don’t think” to yourself over and over for 10 seconds. 

 
When (if mass adoption will come), how will it make way? In my opinion, there are two possible ways that blockchain can fast-track to mass adoption, and these ways are either by being a hold of value (while other currencies fail around the world) or by providing utility to the market. The main industry that people think blockchain will influence, is the financial sector. Financial Times released an article in late 2017 where they asked a dozen seasoned bankers, consultants, and analysts, how they thought blockchain could benefit the banking industry. They responded with clearings and settlements (which deals with the actual cash transaction for the security and updating the user's account), global payments, trade finance (domestic and international trade transactions), verifying identity, and loans. With this being said, Goldman Sachs is currently looking into adding a crypto-focused unit which could help with further implementation. With Goldman Sachs and other banks potentially looking into incorporating blockchain into their already working systems, it provides legitimacy to the future of uses for blockchain technology. To bring up another point, how much do you think it is costing Goldman Sachs and these other corps. to look further into blockchain? Probably isn’t cheap.
 
In the world of sports. “Believe in something. Even if it means sacrificing everything." In 2013, Colin Kaepernick and the 49ers notched an 11-4-1 record earning a spot to play the Baltimore Ravens in Super Bowl XLVII. Starting under center in the biggest football game of his life, Colin Kaepernick began his decline. Losing to Joe Flacco by a score of 34–31 handed the 49ers their first Super Bowl loss in franchise history. Next season Kaepernick went 12-4 losing to the Seahawks in the conference championship game. 2014/2015 was the end of his playing days, his team went 8-8 with Kaepernick losing his starting job before being sidelined for the final couple months with a shoulder injury. Colin Kaepernick has become bigger than football since he refused to stand up for the national anthem before a preseason game in late August 2016. Fighting for what he believes in, Kaepernick has become an icon in the fight against racial injustice and police brutality. He hasn't suited up since 2016 but now stars in Nike's new ad campaign. Staying with the NFL, week 1 of the regular season kicked off last night with the defending champion Philadelphia Eagles squaring off at home against the visiting Atlanta Falcons.



Keep Climbing,
          The Alchanati Campbell and Associates Team

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