ViacomCBS (VIAC)  put out this press release after the close:

Paramount+ Reaches New Heights With Best Week Ever

The Streaming Service Adds More Than One Million New Subscribers, Breaks Acquisition and Engagement Record

NEW YORK, Nov. 17, 2021 /PRNewswire/ -- ViacomCBS Inc. (NASDAQ: VIACA, VIAC) today announced that Paramount+ experienced its most successful week ever, adding more than one million new subscribers and setting a new record for total signups since its rebrand. The service also set new records for most hours streamed and highest level of subscriber engagement. The successful week was fueled by the premiere of the family-friendly film CLIFFORD THE BIG RED DOG; the new original scripted drama MAYOR OF KINGSTOWN, from YELLOWSTONE co-creator Taylor Sheridan; live NFL ON CBS local market games; the highly anticipated CBS event ADELE ONE NIGHT ONLY; America's most-watched news program, 60 MINUTES; and Paramount+ originals SEAL TEAM, THE GAME and the second season of THE CHALLENGE: ALL STARS.

Paramount+ Logo

Contributing to the service's best week ever, CLIFFORD THE BIG RED DOG, which premiered on the service the same day it hit theaters on Wednesday, Nov. 10, set a new record as the service's most-watched original film. Paramount+ original series MAYOR OF KINGSTOWN, which debuted on Sunday, Nov. 14, was the #1 scripted original drama since the rebrand of Paramount+. In addition, Paramount+, which features live NFL ON CBS local market games, scored its second-most-streamed NFL regular-season week ever, in terms of total minutes streamed and unique viewers.

"This week we ushered in a mix of must-see originals, a blockbuster family film and top-tier sports that appealed to the whole household. This is a content strategy we will continue to lean into as we invest in scaling Paramount+," said Tom Ryan, President and Chief Executive Officer, ViacomCBS Streaming. "The remarkable levels of engagement we are seeing are a testament to the power of great storytelling on the service and the sheer breadth and depth of our content offering."

New episodes of STAR TREK: PRODIGY, THE GAME and the new season of THE CHALLENGE: ALL STARS will continue to debut exclusively on Paramount+ every Thursday, while episodes of MAYOR OF KINGSTOWN will roll out every Sunday. Upcoming originals and exclusives for Paramount+ include season four of STAR TREK: DISCOVERY premiering on Nov. 18; the SOUTH PARK: POST COVID exclusive event on Nov. 25; and new series 1883, the highly anticipated YELLOWSTONE prequel, on Dec. 19.
...

Another win for the bulls.
Breadth is awful and Ms Market had many reasons to fail -- but it held in.
Thanks for reading my Diary.
Enjoy the evening.
Be safe.

FINVIZ.com S&P sector map for the day - size represents market cap.

Rivian (RIVN) is -$30.30 on the day to $141.80.

I have sold some RIVN December $140 puts at $21.70 against a portion of my RIVN short.

Market breadth at 1 pm.

On ViacomCBS, here. 

Brokerage stocks are joining money center banks in a rollover now.

I added to the following longs this morning: (C) , (IVZ) , (VIAC) , (FGEN) , (MSOS) and (DISCK) .
__________ 

Long C, IVZ, VIAC common and calls, FGEN, MSOS, DISCK.

Short C calls, IVZ calls, VIAC puts, FGEN calls, MSOS calls, DISCK calls.

From Peter: 

Housing starts in October totaled 1.52mm at an annualized rate, 60k less than expected, the lowest since April and September was revised down by 25k to 1.53mm. Blame the single family category in particular as starts here fell to 1.039mm from 1.081mm, the weakest since July 2020 and compares with the 6 month average of just under 1.1mm. Multi family starts rose to 481k from 449k in September and 485k in August. That is about in line with the 6 month average.

With respect to permits, they were 1.65mm, 20k more than forecasted and up from 1.586mm in September. Single family starts rose 28k m/o/m to 1.069mm and that is a 5 month high so hopefully the starts figure will pick up from here in response. Multi family permits totaled 581k, vs 545k in September.

Bottom line, we know the problems with getting all the materials, land and labor that is slowing the pace of starts. The demand is certainly there for new homes but much less so when prices are 20% higher than a year ago. With rents up 16% year to date according to Apartment List, there is of course the need for more apartment supply and that is in the pipeline. Whether it's enough we'll see but developers are at least trying. Cap rates though for multi family have really compressed to the point where I'm seeing deals below 4%.

Stifel on FibroGen (FGEN)  as the company appeared at the Stifel Healthcare Conference yesterday: 

FibroGen Biopharma (FGEN, Hold, $12.58) - CEO Enrique Conterno In the wake of the Roxadustat CRL issuance for CKD anemia in the US, FGEN has refocused on its priorities of 1) prioritizing pamrevlumab, 2) maximizing Roxa x-US, 3) pushing Roxa over the finish line in the US, and 4) building an innovative pipeline. FGEN and partner AZN have remained in regulatory flux with FDA as they work to address all stated concerns necessary for resubmission.

While FGEN believes they have a reasonable pending proposal sufficient to address the contents of the CRL, the company acknowledged that getting Roxa "over the finish line" in the US will be highly dependent on whether an agreement with the FDA can be reached that specifically satisfies a broad indication.

While its US future remains unknown, Roxa is on a path towards profitability in China with potential value generation from both market (currently ~33%) and patient share (currently mid-teens%) growth. FGEN considers the China investment as its own separate opportunity with expectations for peak China sales of >$500mn viewed as even more realistic in light of Roxa's current progress. Strategic consideration to monetize China remain a possibility.

Roxa remains in clinical development in CIA and MDS, with Ph.2 WHITNEY in CIA having recently reported out positive data and enrollment in Ph.3 MATTERHORN for MDS expected to complete in 2H22/1H23. While riskbenefit in MDS differs sufficiently from CKD to consider Roxa's viability relatively independent, clinical progression in CIA will be highly contingent on FDA feedback in CKD. In the event that Roxa becomes an exclusively x-US franchise, FGEN has begun restructuring efforts to reduce expenses by approximately ~$100mn over the next 3 years and is shifting focus to development of pipeline asset pamrevlumab. Per FDA discussion, the primary endpoint in pamrevlumab's near-fully enrolled Ph.3 LAPIS trial in locally advanced unresectable pancreatic cancer has shifted to event-free survival (EFS) as a more realistic interim indicator of efficacy. The FDA appears comfortable with EFS as a predictive overall survival (OS) signal, and FGEN could possibly file for accelerated approval in the event of meaningful EFS results with positive OS trends (data as early as 2H22).

Separately, pamrevlumab has potential to become a best-in-class treatment in IPF if Ph.2 results can be replicated in the Ph.3 ZEPHYRUS-1 and ZEPHYRUS-2 trials (readout mid-2023), and the Ph.3 LELANTOS-1 and LELANTOS-2 trials in DMD have continued enrollment (readout 1H23).

dougie kass

I am back short ROKU on Moffitt downgrade.
I feel naked not being short the name.
Dougie

Banks are breaking down/rolling over - never a good market signal.

It was a few weeks ago that the Federal Reserve released its Financial Stability Report when they highlighted the financial risks that they themselves created. The ECB today is doing the exact same thing in their Financial Stability Review. "Concerns particularly relate to pockets of exuberance in credit, asset and housing markets, as well as higher debt levels in the corporate and public sectors as a legacy of the pandemic." No, I say, this is the legacy of zero interest rate policy and massive QE. The ECB, just as the Fed, RBA, RBNZ, BoC, etc... have created housing excesses with cheap money and said, "Risks of price corrections over the medium term have increased substantially amid rising estimates of house price overvalutions."

On asset prices specifically, "The markets for equity and risky assets have maintained their striking buoyancy, making them more susceptible to corrections. There have been examples of established market players exploring more novel and more exotic investments." Back to housing, "In parallel, euro area housing markets have expanded rapidly, with little indication that lending standards are tightening in response." You mean that when everyone is encouraged to do shots at a party every 5 minutes that many will get drunk with exuberance and take things to excess?

Further clinching a December Bank of England rate hike I believe, especially after yesterday's jobs data, the UK said its headline CPI rose 4.2% y/o/y in October and 3.4% at the core, both 3 tenths more than anticipated. PPI, both input and output charges, also jumped more than expected. PPI in particular is up 13% y/o/y for input charges and 8% for output. The retail price index, which feeds into the inflation linked gilts, rose 6% y/o/y. It's getting really, really hard to substantiate that a .10% benchmark interest rates is the right stance for a central bank whose sole mandate is price stability. The 2 yr gilt yield is down 2.4 bps today but after rising by 8 bps in the two prior days. The UK 10 yr breakeven is up by almost 4 bps to 4.10% and just off the highest in 25 years. The pound is higher for a 4th day, getting back what was lost after the BoE punted on a hike a few weeks ago. UK stocks by the way remain some of the cheapest in the world.

UK 10 yr INFLATION BREAKEVEN

I include a chart of the US 5 yr yield below because it quietly closed yesterday at the highest level since February 2020 at 1.26-.27%. It started the year at .35% so the market has essentially hiked rates by almost 100 bps. As the average maturity of Fed QE has been about 6 years since March 2020, they are also slowly losing a buyer.

5 yr NOTE YIELD

The MBA said mortgage apps were mixed from last week. Purchases rose 1.5% w/o/w but remain down almost 6% y/o/y. Refi's were lower by 5.1% w/o/w, are down 10 out of the last 12 weeks and 31% below last years mid November level. The uptick in mortgage rates is partly to blame but also I would assume that many who have wanted to refi with historically low mortgage rates likely already have. With respect to purchases, those that are taking on a mortgage are competing against an ever growing pool of all cash buyers, many of course are institutional investors who won't be living there themselves. Another sad unintended consequence of the Fed's monetary policy and the voracious search for yield.

As for that search for yield, if you didn't see yesterday, Calpers is upping their private equity allocation by 500 bps (with PE being a leveraged long) and added $25 billion of debt to the overall portfolio so they can leverage returns to try to achieve their 6.8% target. 

REFI's

There was some important October trade data out of Japan and Singapore today, both areas of production of some very important items that the rest of us need, particularly semi's, electronics, auto's and pharma. Japan's exports, now benefiting from a weaker yen but challenged by the same supply issues as the rest of us, rose 9.4% y/o/y, just under the estimate of up 10.3%. Imports, thanks in part to higher prices of energy that they import, jumped almost 27% but less than the forecast of 31.8%.

Singapore said its non oil exports rose 4.2% m/o/m and 17.9% y/o/y, above the estimates of up .4% and 15.1% respectively. It was both electronics and non electronic products that drove the gain, including machinery, and petrochemicals. While you wouldn't know it by looking at the US futures, most of the Asian stock markets were red overnight. I remain bullish on both Japanese and Singaporean stocks.

Consider this a thought exercise as a follow up to last week's column, "Stocks May Soon Pay the Price for Policy Miscues Currently Being Made by Yellen and Powell." 

I may not be perfectly correct, but I am probably directionally right, at a minimum.   

Shelter is 30% of the CPI.  Owner's Equivalent Rent (OER) makes up about 75% of the shelter calculation or ~23% of the total CPI.  

We moved from using the actual cost of owning a home, to rental equivalence in 1983:   

"On October 27, 1981, Commissioner Janet Norwood announced that BLS would convert the CPI for All Urban Consumers (CPI-U) to a rental equivalence measure for homeowner costs, effective with data for January 1983." (This method was revised again in 1983, 1987, and 1998 as well further pushing the reported numbers down). 

Now home prices are up 20% year over year but OER was reported to be up 3%. With mortgage rates unchanged, the cost of financing a house has not materially changed over the last 12 months, and insurance and utilities and taxes have all gone up - increased appraisals.  The difference between 20% and 3% is 17%. 23% (weight in the CPI) of 17% is 3.9%. Again there may be a good argument against calculating shelter cost this way, but this is basically how we did it in the 1970s.  

Add the 3.9% to the 6.3% reported, we are up to 10.2%.  There is your 1970's inflation. It is not too hard to find another 2%-3% on top of that for the average person either. The composition of the basket itself, hedonics, substitution, other methods of massage and statistical torture, there you go.   

Low teens inflation! 

Maybe the guys that calculate inflation today using the 1970s methodology that results in 15% are not too far off from what today's inflation would be if measured the way it was then.   

The other way to think about it is if inflation in 1970 was calculated the way it is now, the numbers then would have printed at lower rates.  It may be we erred in the direction of too high then, and too low now. Truth may be in-between. 

I lived through both, it feels the exact same now as it did then. Maybe 8%-12% then, 8%-12% now, or something of that ilk, measured apples to apples by methods that are designed to be as fair as possible as opposed to massaging the number down as much as possible.   

Do Not Mess With a Man and His Pastrami Sandwich! 

All I know is that a friend from Boston told me that a pastrami sandwich he ordered on Saturday was $23. He didn't even know the price and he ordered two. When the cashier swiped his credit card, and it indicated $46 (before tax) he asked my friend how much he wanted to tip.  My friend then said "excuse me, there must be some mistake, I didn't order the prime ribeye?"  The cashier told him that the price of pastrami doubled over the last few months. Double means up 100%.   

Do not mess with a man and his pastrami sandwich! 

Coincidentally there is this...  

On inflation: Six is Really 10 & the Causes and Symptoms are Similar to the 1970s:  

On an apples-to-apples basis, the 6% increase in the consumer price index in the past twelve months is 10%-plus in the Burns era since house prices are up nearly 20% in the past year, while owner-rents are up a mere 3%. Statistically, 2021 consumer price inflation is the highest in 30 years. Yet, when actual prices are measured, it is one of the highest inflation rates of the post-war period, matching the double-digit increases of the 1970s and early 80s. Policymakers appear to be repeating the mistakes of the 1970s, as they are ignoring the inflation side of the equation to hit their employment mandate. That old trade-off doesn't work. The longer Powell follows the Burns-policy approach of the 1970s, the risk the inflation cycle triggers a hard landing in the economy. Investors forewarned.  

Follow up to the Morgan Stanley chart below:  

Consumer confidence is telling you inflation is understated when using the misery index as a guidepost. Assuming unemployment is right (using U-6 to be conservative) then the chart suggests inflation is really 12%. 

The Misery Index is the unemployment rate plus inflation. It's 14 on the chart but consumer confidence says it should be 20. Add six to reported CPI inflation and voila, 12%! We had the same divergence in 2008-09 when oil was $150. 

The consumer knows. 

As far as the pastrami sandwich misery index goes, it should be stated that it was a Boston pastrami sandwich. New Yorkers may be thinking that is cheap! But my friend reports that the same Boston pastrami was $17 not too long ago, and it is also not so thick that you can't eat it. I checked the price of a pastrami Reuben at a New York deli yesterday - its $28 now, and another $14 for the individual portion potato latkes. They better not be charging for the apple sauce on top of that! 

Also on the topic of food and the CPI, food away from home only clocked in at up 5.3% year over year! 

Yeah, I have a bridge to sell you too. 

I also wonder if they account for the 4% kitchen admin fees that have suddenly emerged, the 2% COVID surcharge, the bread that used to be free that is now $4-$8, the smaller portion sizes, the lower quality ingredients (hedonics remember?), cocktails that are now equal per ounce as silver - I am not kidding, would love to see a chart of cocktail prices vs. metals if that is possible which I doubt - and waiting an extra 20 minutes for everything because they can't get staff? Obviously the statisticians don't, but if doing so made food appear cheaper you bet they would! 

But the Administration tells us this is not an issue, I guess they also believe a lot of economists are not really economists? 

"Americans are seeing their dollars, their paychecks stretched right now," NBC's Peter Alexander said at Monday's White House press briefing. "Why should Americans not be concerned that injected another $1.57 trillion or more would raise inflation?" "Because no economist out there is projecting that," Psaki replied.

This morning's comments (above) are a follow up to this missive on the same subject a week ago:

Stocks May Soon Pay the Price for Policy Miscues Currently Being Made by Yellen and Powell

* In 2022 the Fed will likely be forced to suddenly slam on the brakes in order to quell inflation

* The casualties will probably be demand destruction, a visible downturn in economic growth and weakness in equities

"Once again, the Fed is misreading inflation dynamics. Policymakers continue to argue that the current inflation cycle is temporary, centered in few products and industries, and will unwind as bottlenecks dissipate. Inflation cycles are not static or linear; they rotate and broaden. The next phase of the inflation cycle will be in consumer services."

- The Carson Report, Another Fed Misread: Inflation Cycles Are Not Static -They Rotate and Broaden

If inflation was measured today in the same way it was measured then - 2021 inflation would be as high as in the 1970s, see here.

As a consequence, the Federal Reserve - led by Powell who wants to be reappointed, and abetted by Treasury Secretary Yellen - is allowing inflation to accrete by continuing QE.

At the same time, fiscal policy is out of control.

Inflation Now

Using 1980 methodology - not perfect, but in the zone - inflation is close to 15% today.

Yellen, et. al, are making the bet that when inflation laps the tough comps, inflation will fall.

By that logic, if inflation was 100% now, and then was 2% next year, she would be right and everything would be fine, except for the fact that we would be broke.

Further using this logic, anytime inflation is above target, they can always say it is transitory and will come back down.

But you could say the same thing about deflation, when it is lapped, eventually inflation will return.

Also, if inflation reports up 16%, then if lapped and was down 8%, they would consider it a disaster, even though the two year average would be well north of what is considered price stability.

The Adverse Consequences Seem Baked In

Basically it is all a word salad of BS and a policy error - with all its adverse consequences - seem baked in.

It is my view that based on real interest rates monetary policy is more easy now in November, 2021 than it was in March, 2020.

Another point is that that you never recover the purchasing power. Every dollar holder is out that 6%-plus, measured year-over-year, regardless of what happens next year.

The reason the price level - always hard to measure - was more or less unchanged over multi-decade spans under the gold standard is the inflationary episodes alternated with deflationary ones. In the absence of deflation, there's no make-good, only varying rates of permanent loss.

No wonder Bitcoin is having a party!

Regardless, we do not have apples/apples compares as the methodology for calculating the CPI has changed substantially over time.

1970s inflation was not measured the same way inflation is measured now. As I understand it, the numbers in the CPI series have not been restated going backwards. Thus, we are comparing apples and oranges.

When Yellen, Powell and the others say we are not and won't experience 1970s like inflation, she is being very disingenuous. The numbers were measured differently. 15% then could be close to equivalent to 6% now, the way the calculation has changed. 6% now could be close to 15% then, or even 12% then. It is hard to know, but we are dealing with apples and oranges. The guys that try to adjust the numbers say we are in the same place now as then. If they are off by 3%, it doesn't really matter. The 6% is really 12% as opposed to the 15% they estimate. 12% is still 1970's like inflation. As is 10%, 8%, or even the 6% that just printed.

My eyeballs tell me inflation is running a fair bit hotter than what is being reported now. I think the average person would also think that based on their buying experiences today.

This is all sort of like nerd stats in baseball. The nerds tell me Jackie Bradley Jr. is a great baseball player based on contrived statistics about his fielding ability. My eyeballs tell me he sucks. His salary tells me that as well, because the guys making the actual decisions and spending the real money realize the nerd stats are contrived garbage.

Regardless, you never get it back once it happens.

It is not a victory if the CPI only grows about 2% next year. For most people (not Jeff Bezos), they have been permanently impaired by what happened this year. Real weekly earnings are reported as down -1.6% (year over year), reality is probably a fair bit worse.

Also how do you measure the cost of empty shelves?

Finally, this is interesting as well... owner's equivalent rent still has a lot of catching up to do to actual housing inflation (OER only up 2.9% versus housing prices up 20%)!

I have continued to steadily short the shares of Rivian (RIVN) over the last few trading days. I have shorted more RIVN at $177 in premarket trading early this morning. 

As stated, my plan has been to start very small and steadily scale into a somewhat larger, but still small, short on strength - something I did successfully with Tesla (TSLA) over the last month. I only have tagends left to that short. 

I make the effort of dutifully reporting my trades, and entry price, in real time. I believe my transparency is as complete as anyone on this site or elsewhere. 

I fully recognize that my views may not be shared by others and, importantly, no one should blindly adopt my views or anyone else. I have made this very clear over the last 24 years. You take responsibility for your own actions - which incorporates many factors including health, age, finances, financial obligations, balance sheet, etc. which may differ dramatically from mine. I don't run your money and I am not making investment recommendations, I just show you what, when and why I am transacting. From there, do your own homework. 

To say, as someone has in our Comments Section, that I materially effect a subscriber who might have purchased a short term rental in Rivian - because I am shorting Rivian - is an insult to our subscribers who are generally knowledgeable, understand reward vs. risk and recognize that they are the final arbiter to trading and investing decision making. 

Given the short term strength of Rivian as well as other EV manufacturers like Lucid (LCID) - I have given the shares of Rivian a very wide berth in my program of scaling into the short. This program implicitly acknowledges the popularity of these stocks by The Apes, the Redditt (wallstreetbets) crowd and others who, over brief periods of time, can muscle stocks and tend to treat stocks as a game, disregarding valuation and intrinsic value of a company. 

My short, by contrast, incorporates the notion that in the longer term, stocks are a weighing machine and not a voting machine. 

That is not to say that making money on the long side of any overvalued stock is not a pure endeavor. I admire those that can game Rivian or any stock on the long side - but that is not my game and my short's timeframe is likely more extended than their long time frame. 

My current cost basis on the short is about $152/share and my position remains quite small. 

My current plan is to short a package of EV companies and not to restrict my short position to Rivian. As I select over EV shorts I will report back in my Diary. 

In terms of size objective, I would continue to emphasize that the entire EV short package that I contemplate will remain very small,  consistent with my risk profile and discipline. 

As also mentioned frequently, shorting is an exercise for the few and shorting high octane stocks like the EV OEMs is for even fewer. 

As to why I even mention such a small short position, as a subscriber criticized this week, I try to be transparent in all my trading and investing activities - even if my target, long or short, is quite small in size. 

Remember, though I might be wrong, particularly over the near term, about the EV space, I think it is important to highlight trades/investments even though small sized that may result in larger percentage profit opportunities than "the average stock."

For me, there is always room for speculation in one's portfolio - as long as it is right sized, in both the long - (FGEN) might be an example -  and short side. 

I hope my explanation is understandable.

A terrific read from Lance Roberts.

From Marijuana Moment, here.

More on FibroGen (FGEN) , here.

Wells Fargo upgrades Boeing (BA) from neutral to overweight.

Another one from Lisa:

From Danielle DiMartino Booth: 

"While prices are boosting top-line retail sales, stubbornly high and rising prices could act as a governor on future spending through hits to consumer purchasing power."

Precisely and amen, Danielle!

• October's 1.7% MoM retail sales print was the largest since March and more than four times greater than the 0.4% long-term average; however, given these are nominal terms, deflating them using the CPI shows real retail sales remain 6% below March's post-pandemic high
• At 1.09, September's retail inventory/sales ratio hovered just above April 2021's record low 1.07 print; prior to the pandemic, this metric had never fallen below 1.3, with fiscal stimulus helping to drive a persistent supply/demand imbalance and pull forward consumer spending
• PPI retail trade inflation, though off its June peak of 12.2% YoY, remained high in October at 8.2%; as z-scores, retail inflation is rising at above-trend rates in six sectors, notably autos, furnishings, general merchandise, clothing, miscellaneous goods, and recreation goods