So the Cares Act is beginning to unwind. In fact, without an act of Congress it ends July 31st. Will the economy unwind with it? As the Cares Act unwinds in just the next day or so, is the economy going to unwind with it? We know July 31st the unemployment benefit of additional $600 is expiring. Now there is an interim proposal to keep it going until a negotiated settlement has been reached. I think the Republicans would like to continue the unemployment benefit, but with just an additional $200 instead of $600. And the other issue is evictions. There's been a moratorium on evictions for all properties that are backed by a government-subsidized loan - Freddie Mac, Fannie Mae, all of those. That has actually already hit the sunset provision. Again, if they don't extend it, will there be massive evictions as well as the loss of unemployment...

Probably everybody at the airline knows now that there's a letter of agreement for voluntary pilot separation leave. It's a pretty interesting deal. Is this something that you should take? A couple of pointers about this offer. I mean, I'm not going to go through the whole thing. We'll put a link to it (see below), but the briefings that ALPA’s sent out are pretty darn good, but there are some relevant salient points. One, the pain effect, is when you bid for the package. Why is that salient? The next year it's going to be ugly. Pay cuts may actually happen, or maybe a reduction in the guarantee. And if there's a reduction in the guarantee, for example, then that brings the guarantee down to maybe 60, 61 hours if it's a 15% reduction. That kind of reduction, that's only a 10-hour spread for working versus not working. Also,...

Now the fed is looking at corporate bond purchases through exchange traded funds. Welcome the new world of yield curve control. But what does that mean for you, your portfolio and the economy at large? Yield curve control. Nice, fancy word. It's largely focused on keeping interest rates low, primarily at the long bond end. Because let's face it, we're borrowing a lot of money. And to the extent that that money being borrowed is long-term debt, it does behoove the government to keep the cost of that debt down. But not just for the government. It also affects the economy and industry at large. With low corporate rates right now, there is the question, is this even necessary? When we talked about buying corporate bonds back in April, the spread between corporate bonds and treasuries was rather large. But now that spread's fairly narrow, and that suggests the corporate...

The United States has injected over $3 trillion into the economy and it's debating even more. How will that impact inflation? Being an election year, the administration is a little bit more willing to prime the pump through November, than maybe in a more traditional year. Will this pump priming trigger inflation? Those of us who remember the 1970s know that inflation can be a scourge. It saps your purchasing power, destroys the value of a fixed income. There's reason to fear inflation. But to understand inflation we need to understand what drives inflation. As any freshman Economics student will tell you, inflation is really too many dollars chasing too few goods. But there are two saucers of inflation. One is Demand-Pull inflation. Money times velocity equals the money supply - the availability of money. What is velocity? Velocity is how many times a year the money is spent. So...

Printing money and FOMO (Fear Of Missing Out) has really boosted the market, but high unemployment and a diminished consumption cannot just be wished away. A lot has been made of the fact the market is back to where it was in early March. More relevant to me is that the prices are where it was back in late October when we had historically low unemployment and a market, sorry, an economy, firing on all eight cylinders. The market valuations, to be at the same price, are significantly higher today. What we have is the euphoric, lighter fluid effect. We're not seeing a V-shaped recovery in the economy. We are fortunate we're avoiding the "L." It appears the predicted "Nike swoosh" is what is actually happening. And yet by Labor Day GDP, will still be two-thirds of what it was pre-Covid, and unemployment will be in double digits. It would...

Brent oil is finally reaching $35. A sustainable - albeit low figure - up from a low in April of just $16 a barrel. A 21 year low. What is the future for the Energy industry? How's that going to impact both the nation and, specifically, Houston, Texas? Oil demand is picking up. In fact, when you look at the numbers it's pretty remarkable. However, these numbers are up from a very low base. OPEC and Russia's squabble finally has resulted in a truce, and from May 1st they agreed to reduce supply by about 9.7 million barrels per day. No small amount. However, at these prices, the ongoing decimation of America's shale industry may at some point in the future result in us once again being somewhat - not completely - dependent on Middle Eastern oil. That dependency in itself is a little bit concerning because the Middle East...

So Boeing CEO, David Calhoun, last week really threw the airlines under the bankruptcy speculation bus with his comments. And yet recently we have had some rays of hope. There's been a lot of bleak news for United recently. Delta, back in April, tried to issue $5 billion and got it for 7%. The United bond yield fizzled, despite raising the interest rate up to as much as 11%, and securing it with 360 - albeit older - aircraft. The market - I don't know if it was a reflection on United or reflection on the markets feeling that those, the older aircraft, probably have little or no resale value after factoring in the value of the engines. Warren Buffet at his recent presentation announced that he is heading to the hills with respect to the airlines. He has sold all of his airline investments, and is pretty much running...

There's a well-known Chinese curse: "May you live in interesting times." These are interesting times. Last weekend I listened in on Warren Buffet's shareholder meeting. For the first time ever there was no one there. It was a virtual meeting. And he made two very interesting points that I'd like to bring up. First, he talks about how there are no good deals out there. I think that's important because there's a bit of a mania in the markets right now. It's almost as if people aren't looking down the street. In fact, just today, someone close to me lost a high paying job. There's a lot of damage in the economy. There will be good deals. We just need to be very circumspect how we proceed in the next six months. We also are looking at debt not seen since the end of World War II - and yet...

Over the weekend United Airlines announced a displacement bid. Probably everybody's seen this. How will that bid affect you and what, if anything, can you do about it? Over the weekend we've heard that they're planning on displacing about 4,500 pilots; as much as 41% of the workforce. Now, we all know that the airline's going through a brutal period, but it doesn't mean that the airline's going out of business. In fact, this is kind of encouraging news because usually the "M.O." of an airline is to make its worst-case position, its worst-case scenario, available in a displacement or a furlough bid. Back in 9/11, after 9/11, I was told I'd be furloughed. That fuse actually stopped six numbers below me. Quite a few people in the end weren't. That's normal, because of the 60 day wait that they have to give both certain States and the federal government...

How does oil go negative? And what on earth does that mean for the rest of us? Well, earlier this week oil prices collapsed. Momentarily, futures hit -$40. But was that a true reflection of the market? I mean, if we look at Brent, which is another commonly traded sweet crude, their prices hit closer to 20. This does suggest that there's more going on here than just simple supply and demand. What on earth happened? Well, first there are two things. One, in Texas, just like everywhere else, it's very difficult to completely shut down an oil field. When you turn off the spigot, that pressure doesn't just dissipate It can cause damage to the field. Two, because of the collapse in demand in the United States and the fact that the rest of it must be exported, we have a scenario where no one can take the oil....