Senior Managing Editor of The Freeport Society
My name is Teresa. It’s a pleasure to meet you.
Charles likes to call me his “South African editorial mercenary, with a lethal pen”… so you could think of me as his “handler.” In all seriousness, though… as the Senior Managing Editor around here, my team and I keep Charles and The Freeport Society on task and on track. And starting today, we’ll be bringing you The Freeport Navigator Weekly Roundup.
But, this will be more than just a look back at the chaos we survive each week. We’ll also be looking forward to the following week so you can properly prepare.
So without further ado, let’s get cracking…
Mark Zuckerberg shocked literally everyone when, on Wednesday, he apologized to parents at the U.S. Senate child safety hearing.
When I asked Charles what he thought about this, he replied:
Facebook should be grilled… The jerks have ruined the country, and their product is legitimately dangerous for children. But the people grilling him are the same people who use his platform to cynically spread lies, damned lies, and (fake) statistics.
(Ahem… I might have cleaned up the language some to make it family friendly.)
Facebook – Meta Platforms Inc. (META) – wasn’t done with us, though.
The company shocked Wall Street on Thursday by announcing it would start paying a regular quarterly dividend.
That only led Charles to expand on his disdain for Meta (and to offer an olive branch):
I blame them for the fall of human civilization and consider their products infinitely more destructive than cigarettes, drugs, alcohol, or even fully automatic firearms sold to actual infants.
Social media has reduced the human race to a cesspool of narcissistic trolls and made all of our lives materially worse. I will not apologize for saying I hate Meta.
That said… I will also absolutely give credit where it’s due and congratulate Zuckerberg and company for growing up, putting on their big-boy pants, and declaring that first dividend.
It’s a sign of maturity for the company and a visible sign of putting the shareholders first.
Dividends are about far more than income. They’re about making a better kind of company, and the vast majority of the quality companies I follow in The Freeport Investor – what I like to call the “Rich Man’s Currency” – regularly pay and raise their dividends.
Not to allow rival Zuckerberg all the attention, Elon Musk had his time in the limelight this week as well.
Not only did a judge rescind his $55.8 billion compensation package, but he is also moving his Tesla Inc. (TSLA) incorporation out of California and Delaware… places where some of the giants of American capitalism have long called home.
Musk is perhaps one of this century’s greatest innovators – a symbol of the exponential progress that made this country the envy of the world… despite being extremely divisive and threatening to go to Zuckerberg’s house to fight him, man to man.
The two states he is abandoning have become the epitome of anti-innovation. Unfortunately, more states are stumbling down that same path. That’s why it’s so important that we band together as a society – The Freeport Society.
Finally, the Federal Reserve wrapped up its meeting this week and opted to keep interest rates unchanged at a range of 5.25% to 5.5%. Everyone expected this. Yet investors pitched a hissy fit. Likely, it’s because of this little nugget from the Fed’s statement: “The Committee does not expect it will be appropriate to reduce the target range for the federal funds rate until it has gained greater confidence that inflation is moving sustainably toward 2 percent.”
Charles has said it many times: Inflation is stickier than most people – including the members of the Fed – realize because of where it is. Costs of material goods might not be rising as fast anymore, but costs of services are still increasing.
Accordingly, our Freeport Investor model portfolio currently holds three positions right now specifically to counter the effects of inflation. Our Freeport Society friend, Louis Navellier, explains why this is so important, and what Charles looks for when finding the best investments for these crazy times, in this special presentation.
Now, let’s recap what Charles covered this week here in The Freeport Navigator…
The leading maker of electric vehicles is having a hard time of late. How did everyone’s favorite company run by everyone’s favorite tech visionary/comic-book villain fall from grace? Let’s take a look…
In 1974 the federal government mandated that 55 miles per hour was the maximum speed on all interstate highways. That was the wrong response. Capital markets knew and did better. Now, the government is interfering again…
Here’s the least shocking news you’ll hear this week. According to recent data from a respected stock market research platform, the folks in Washington aren’t keeping their hands out of the cookie jar. What IS a little bit shocking is that there seems to be little to no outcry about all this.
Looking Ahead
Next week looks to be a week of celebrations, what with next Saturday being the Lunar New Year and Sunday being Super Bowl 2024.
Do investors have any cause for exuberance?
We’ll see the consumer credit report next Wednesday and initial jobless claims on Friday. So maybe investors will have something to make them happy.
However, Fed Governor Christopher Waller recently complained that the data they’re so dependent on is pretty useless. They make decisions on numbers released, only to have those numbers revised three months later, often significantly.
This means you should take yesterday’s blowout jobs report with a grain of salt. Next Friday’s initial jobless claims as well.
We’re shocked it’s taken so long for anyone at the Fed to realize how useless the stats are. As Charles pointed out earlier, there are “lies, damn lies, and statistics.”
But the one thing Charles is watching closely next week is the U.S. Treasury.
It will hold its largest-ever bond auctions over the next three months, one of which will be a 5-year, $70 billion auction in April. All of this is an effort to plug the budget deficit because, as Charles puts it, “the drunken whoremongering sailors can’t stop spending money they don’t have.”
That’s it for this week.
Your “mercenary” in the pursuit of life, liberty, and freedom.