YWR: Killer Charts
Disclosure: Personal Views Only. Not investment recommendations.
We’ll cover why the S&P 500 was over earning in 2021-2022, but now seeing the negative catch up from costs. We’ll look at two non-AI companies making more money than they know what to do with at P/E’s of 5. Finally, the potentially interesting set up for copper and two opportunities in Africa.
The Cost Catch-Up
Companies benefited from inflation on the revenue side in 2021 and 2022, but are now seeing the cost side catch up.
It might be temporary, but wages are now exceeding inflation.
We’ve seen this yield curve chart before, but given the strong market performance since October, combined with negative S&P 500 earnings revisions, and still high valuations (20x P/E on S&P) it now looks more ominous.
