MidSouth Week in Review
September 1, 2023

Weekly Update from Fund Manager Buzz Heidtke, MidSouth Investment Fund

For the week the S&P was up 2.4% but was down 1.8% for the month of August.  U.S. mortgage apps dropped to the lowest level since 1995.  The U.S. bankruptcy filings rose to 285 vs. 198 last year.  Dollar General dropped 19% yesterday on bad earnings and increasing theft by their customers.  Consumer spending rose 0.8% in July.  The month of September is the worst performing month of the year, possibly because the weather is changing from warm to cooler.  The stock market will be closed on Monday in observance of the Labor Day holiday.  Sources:  Wall Street Journal and New York Times

S&P 500 Companies – Nearly 80% reported profits that were better than Wall Steet analysts had forecast in the 2Q – Axios

Learning to Spell – When I was 16 I was late for school one morning so I forged a letter by mom saying, “Please excuse Lyman for being late this mourning because he was ill”.  An hour after I got to school, the principals office called me in to come to the office.  There the principal asked me to spell morning to which I replied mourning.  He then asked if I wrote the letter.  I said yes and asked how he knew.  He replied “You had better learn how to spell morning next time.  After a good paddling, I worked on my spelling – Buzz

Returns – Over the past 40 years the S&P has returned an average of about 11% annually vs. a 7% per year return from the bond market – Robert Carlson

Walking – Studies have found that 8,000 steps lead to a lower risk of dying from heart disease or any cause.  Adults who walked 8,000 steps about four miles, over one or two days a week were 14.9% less likely to die vs. adults who walked less – Piedmont Healthcare

Mortgage Rates – could peak in the 4Q, if the Fed halts rate hikes by then.  Mortgage rates aren’t likely to slip below 6% until the 2Q of 2024 – Kiplinger Letter

U.S. Commercial-Property Prices – fell 16% since peaking March 2022.  A lack of credits hurts the value of real estate – Green Street

CEO Survey – 23% were born outside the U.S.  81% are male, 69% are between 35 and 64, 84% are married, 76% are White, 10% are Asian and 3% are Black.  91% have at least a college degree – INC.

New Single Family Homes – sold at an annualized rate of $714,000 in July, up 4.4% from June’s pace.  The median sales price of homes was $436,700, up 4.8% vs. June – U. S. Census Bureau

Short-Dated Treasury Yields – hit the highest level since pre-2008.  The recent auction of the two-year Treasury notes offered a yield of as high as 5.02%, the highest since 2006.  The five-year debt was offered at 4.40%, the highest yield since 2007 – Bloomberg

Home Owners Insurance – 12% of homeowners don’t purchase home owners’ insurance.  About half of them have annual household income of less than $40,000 – Insurance Information Institute ….. Home owners insurance is $6,000 annually in Florida and is going higher vs. $1,700 everywhere else.

Company Buybacks – Companies that are buying back their own stock are often good investments.  Look for ones that have paid steady or increased dividends for five years, whose debt level is no more than 30% of total capitalization and whose market capitalization exceeds $100 million.  Stocks that meet these standards have outperformed the market by more than 25% since 1982 – Hugh Lamar, M.D. Sass Investors Services

Home Renting – With the exception of Detroit, Philadelphia, Cleveland and Houston, renting cost less than buying.  Renting costs about 25% less – Redfin.com

1952 Cost of Living – New House $9,075 · Average Income $3,850 per year · New Car $1,754 · Average Rent $80 per month · Tuition to Harvard University $600 per year · Movie Ticket $0.70 each · Gasoline $0.20 per gallon · Postage Stamp $0.03 each.

Elvis - https://www.instagram.com/reel/Cv_5Upogyla/?igshid=NjZiM2M3MzIxNA==

Sunday Oldies - https://www.instagram.com/reel/Cv6dRx5uLRD/?igshid=NjZiM2M3MzIxNA==

The Biscuit Eaters - https://www.instagram.com/reel/Cu2ZALoxdrg/?igshid=NjZiM2M3MzIxNA==

The Fifty States in Rhyme - https://www.instagram.com/reel/Cuorda-uRur/?igshid=NjZiM2M3MzIxNA==

Guys Dancing - https://www.instagram.com/reel/CwCcgXSpJRH/?igshid=NjZiM2M3MzIxNA==

The material was prepared by MidSouth Investment Management LLC, and does not necessarily represent the views of the presenting party, nor their affiliates.  This information has been derived from sources believed to be accurate.  Please note – investing involves risk, and past performance is no guarantee of future results.  The publisher is not engaged in rendering legal, accounting or other professional services.  If assistance is needed, the reader is advised to engage the services of a competent professional.  This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty.  This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such.  This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested.  All economic and performance data is historical and not indicative of future results.  Market indices discussed are unmanaged.  Investors cannot invest in unmanaged indices.