Into The Heart Of Winter — First Bee Check

InnerCoverJanuary 24, 2015 — I finally had a chance to check on the bees this weekend as right now marks the heart of winter for the colony and the most stressful time of year.

Going into late fall / winter perp the goldenrod and asters provided adequate nectar and pollen and both hives quickly backfilled the top brood boxes. I didn’t have to do much supplemental feeding of 2-1 sugar syrup to bring them up to weight.

November 23, 2014 was the last day I had the hives open making sure they were set for overwintering here in the northeast part of the US. I overwinter in 2 deep’s typically, but this year I also left each hive with a medium super that I didn’t pull. I’m feeling pretty confident in that decision as this week we are expected to get slammed with up to 2 feet of snow in Greenwich.

It’s was such a relief to see them flying today (in the mid 40s) and even bringing in pollen. The source of the pollen, I have absolutely no idea! But it’s pretty amazing to see in January. It’s one of the small joy’s in life, peaking in the hive when weather permits and seeing the bees still hanging around — alive!

A few bees making work of the dry cane sugar

A few bees making work of the dry cane sugar, used to absorb condensation and as emergency food. 

Based on colony weight they still have a full deep left of stores and the top supers, from what I could see, had plenty of honey — just the very top 3 cell rows were uncapped.

I’m pretty happy with the cluster size, didn’t see the queen, but I didn’t expect to spot her and I didn’t pull any frames or break the propolis seals on the deeps. Most of the bees were in the middle box, not up at the top with the cane sugar. I had a GoPro set on a time-lapse and can check in on them while in NYC. I wasn’t seeing much activity until today. It’s just been too cold to fly, too rainy.

No small hive beetles either on the inner cover, which have been the absolute bane of my existence this year. No wax moths either or any varroa spotted on any of the bees up top.

Any clear day with the sun shining, and clear skies, is a great day to fly — for pilots and honeybees alike. I’m reminded of their resilience to work together as a team when each night we are well below freezing, rain, sleet, and snow.

This weekend was a glimmer of hope that beneath the outer cover, and inner cover, life is teeming and even thriving with a steady rhythmic beat of vibrating detached wing muscles keeping the cluster warm. I think they’re gonna make it.

Video of bees getting some pollen in…

I’m sure I’m not the only one ready for spring, the bees are too, which is when the cycle and race to harvest liquid gold (honey) starts all over again.

Bringing in some pollen!

Bringing in some pollen!

In comparison going into late fall was just a massive cluster, the height of aster and goldenrod honey. Overwintering much smaller with not much brood rearing. In the spring they will ramp up production and the population explodes again.

In comparison going into late fall was just a massive cluster, the height of aster and goldenrod honey. Overwintering much smaller with not much brood rearing. In the spring they will ramp up production and the population explodes again.

See ya’ll in the spring. I will definitely be doing some splits off hive 1, and hopefully get a few more hives going. Not an easy thing to manage on my limited schedule, especially in the summer and spring when M&A rages on.

* Click the pictures for larger images.

C&I Loans +$12.8B, Consumer Loans +$6.3B per Fed H-8

January 23, 2015 — Loans and leases in bank credit for commercial banks increased for yet another week by $28.3 billion to 8,005.6 billion per the latest Fed H-8 report.

Commercial and industrial loans increased by $12.8 billion up to 1,805.7 billion up from 1,792.9 billion.

  • Residential real estate loans increased by $5.6 billion to 2,027.2 the week ending Jan 14.
  • Commercial real restate loans increased by $3.4 billion to 1,606.9 up from 1,603.5 billion.

Continuing the strong trend consumer loans increased by $6.3 billion to 1,215.5 billion up from the previous week of 1,209.2 billion.

Fed funds and reverse repos declined by $5 billion. Loans to commercial banks increased by $300 million. Treasury and agency securities added $7.7 billion on the week.

All things considered another positive sign as loans continue to pick up and perhaps finally turn the corner as we all wait around on what the Fed’s gonna do.

*It’s been a busy week again but thankful for having Monday’s to look forward to. We’ll see how the Fed reacts to Draghi’s move on the ECB’s 1.1 trillion euro QE; 60 billion euros each month.

Consumer Loans +$12.5B, C&I +$8.6B per Fed H-8

January 16, 2015 — Loans and leases in bank credit for commercial banks increased by $47.6 billion to 7,986.7 billion per the latest Fed H-8 report.

Commercial and industrial loans increased $8.6 billion, from 1,785.4 billion to 1,794.0 billion.

Real estate loans declined by $7.3 billion to 3,634.6 billion. Residential real estate loans declined by $11.3 billion to 2,025.6 billion. Commercial real estate loans increased by $3.9 billion to 1,609.0 billion.

The real bright spot in the latest H-8 was an acceleration of consumer loans, standing at $1,208.1 an increase of $12.5 billion from the previous week.

Fed funds and reverse RPs with nonbanks increased by $18.8 billion to $340.9 billion. Interbank loans increased by $4.5 billion (Fed funds and reverse RPs), cash assets increased by $310.1 billion to 2,883.0 billion.

*Been a hellaciously long and busy week, yay for leaving the office Friday at 4:45 am on Saturday…. :-? tired. :-?

Life In Vicious Circles

January 6, 2015 — The world requires effort and energy. Living requires paying attention. The ability to be human, to worry, to lose our temper without our compassion; that fundamentally deep within us we can still sympathize with the pains, difficulties, struggles that come with being human when we see suffering, and things that aren’t “right” in the world. Either we are in tune with the world, the current events, or just another oblivious Kardashian-like drone.

The very fact that we are one amongst billions is a troubling notion. Ponder the immensity of the world at your own risk.

Bull market. Bear market. Greece. Greece exit. The euro zone, ECB, Fed, BOJ, BoE; on and on. Market ramping on low and pathetic volume. Market viciously selling off on large volume. Social unrest. Oil collapse 50% over 6 months.

The world as it is doesn’t seem fair. Income inequality. The endless struggle with rationalizing monetary policy. Political “uncertainty” and extrapolating every shred of news into the “bigger picture” as to what it all means.

It’s living life in vicious circles. The rat race of life. Do we ever stop and feel cheated at the rapid pace of life? Or change that we don’t like?

I lost my father to cancer two years ago and its been a struggle coping with his loss. Between the financial crisis and the past events of this decade, I’m often left thinking — why? Wanting to say something but having nothing to say. Writers block. Not any time because of work. M&A has been incredibly active — for which I’m thankful.

The late philosopher, Alan Watts, sums the haunting paradox of life beautifully. The endless need to rapidly advance, continuing to climb the corporate ladder.

Have we arrived?

In the world of $50 crude, in the world of news-cycle overload, whisperings of imminent collapse, the cycle of constant worry, evaluation, craving, the need to be “right,” to matter. When it’s all said and done, one day it will make sense.

Don’t over-think it. Easy to say but so impossibly difficult to do. If I talk all the time, tweet all the time, I don’t hear what anyone else has to say. Time. Space. Reality. Perhaps they have only trivial regard for each of us as we go on about our daily lives.

Life in these vicious circles….

Jobless Claims Fall to 291k, CPI Unchanged

November 20, 2014 — Initial claims for the week ending Nov 15, was 291,000, a decline of 2,000 from the week prior, according to the DOL. The previous week was revised up to 293,000. 4-week moving average holding steady below the 300,000 mark at 287,500.

The total number of people claiming benefits in all programs for the week ending November 1 was 2,183,590, an increase of 81,659 from the previous week. There were 3,882,383 persons claiming benefits in all programs in the comparable week in 2013.

The Consumer Price Index was unchanged in October, with the energy index falling 1.9 percent.  The gasoline index fell 3 percent in October and has fallen by 8 percent the past 3 months.


The CPI food index rose 0.1 percent. All items less food and gas increased 0.2 percent in October. Apparel declined 0.2 percent while the shelter index (housing) increased 0.2 percent in October.

Overall the report showed slight increases with the big energy decline offsetting shelter, medical, and new vehicles.

All things considered inflation remains below the Fed’s 2.0 percent target rate. Much of the data is consistent with how the FOMC views the overall macro picture. I don’t expect any big changes to policy regarding the CPI report.

Pepsi Crushes Earnings, Silences Foodie Movement

pepsi1October 9, 2014 — Pepsi posted earrings of $1.36 a share vs $1.29 a share estimates. Revenue increased to $17.2 billion up 2% from $16.9 billion the previous year. Revenue topped Wall Street expectations of $17.09 billion. Net income increased to $2.08 billion up 5% from 1.9 billion the prior year. PepsiCo also raised its full-year earnings forecast to 9%.

Revenue from PepsiCo’s North American Frito-Lay food division grew at 3% to $3.52 billion. Revenue from Frito-Lay Latin America food division increased 6% to $2.18 billion. North American beverage sales declined to $5.38 billion from $5.4 billion the previous year. EMEA beverage sales increased 11% y/y to $1.78 billion up from $1.6 billion.

“We delivered good third quarter results in the face of an ongoing challenged macroeconomic environment driven by increasing volatility in the emerging markets and continued sluggish consumer demand in developed markets,” said Chairman and CEO Indra Nooyi.

The strong results from Pepsi rebuffed calls by activist Peltz for PepsiCo to spin off its more profitable snack division from its beverage division.

Pepsi’s third quarter results put the “millennials will refuse to eat junk food and swig sodas” and the “we’re all gonna embrace the hipster fresh eating” narrative to bed. The results are indicative of individuals remaining loyal to the world’s largest snack food maker in the growing cacophony of organic-only, ‘fresh-is-the-best’ eating market narratives.

With a diversified product portfolio and core brands remaining strong, pepsi will continue to navigate the challenging global macro environment. As Chairman and CEO Nooyi noted, “PepsiCo achieved these results because our brands are strong, our product portfolio is on-trend, our geographic footprint is broad and diverse, and we are executing well in the marketplace.”

Entering The Homestretch As Q3 Ends

September 30, 2014 — As the Fed’s much maligned QE program winds down — and I fully expect the completion of said program by the end of October, — it’s important to take stock of where we stand. For me personally it’s been an extremely busy month and even busier quarter, but I’m thankful for the work. While the hours have been taxing mentally and emotionally, I remind myself there are still 9.6 million without a Monday to look forward to.

Since 2009 the bull market has caused a great deal of worry and musing, pondering, and ranting that “the market isn’t the economy” and it’s “manipulated by the Fed.” Daily arguments on blogs, news sites, and social media about why the market is up if the economy is “bad.”

Financial institution disgust and outrage remains palpable. Investment banks primary business is to be the middleman and being that often frowned upon middleman by retail investors and financial media alike undoubtably involves being burdened with conflicts of interest… it’s all market fodder in these interesting times we live in.

Some investors want to have their cake and eat it too. A “weak dollar” equates to the US Federal Reserve debasing it, crushing the purchasing power, and a black swan event will no doubt force yields higher; on the flip side a strong dollar (such as the current performance of the USD) will “crush earnings” and the economy.

That said many seeking seed funding have only known an environment where money is readily available and easy to raise. This won’t always be the case. What happens when this changes? Venture capitalist Bill Gurley says all the giddy silicon valley have taken far too much risk and blowing through cash like a profligate Kardashian.

That leaves us with the market.

The year long strong performance of equities can be attributed to liquidity — corporate buybacks, investor leverage, and the highly criticized POMO by the NY Fed desk. The question remains where we’re going – and how we are positioned – in a world which continues to show signs of destabilization, and investor panic about lift-off from zero-bound.


A run-up in stock valuations has made share repurchases less effective. Quarterly buybacks declined year-over-year (-1.1 percent) for the first time since Q3 2012 to $123.7 billion. We are in my view seeing the apex of corporate share repurchases. (Chart via FactSet)

Secondly the NY Fed desk has drastically scaled down POMO. Last September the desk was purchasing $45 billion in Treasury securities over the month to boost excess reserves in the banking system. This month the desk purchased $15 billion in Treasury’s. October 2014 the desk is scheduled to purchase $10 billion and it is widely expected by November for the Fed to stop adding securities to its portfolio — a welcomed sign by many.

The Russell 200 has experienced a “death cross” where the 50-dma crossed below its 200-dma.  The index  (RUT) has underperformed the broader markets during the quarter. Perhaps crash springs eternal? Either way rising rates and lackluster Q3 results will continue to apply pressure to valuations both SPX & RUT. Market breadth continues to deteriorate paving the way for a new trend in Q4 — stocks pulling back from ATH’s.

Inflation expectations have plunged. European core prices grew at 0.7 percent vs expectations of 0.9 percent — the Euro fell in trading. Consensus expects the first US rate hike to take place at the end of Q2 2015 — I am remaining in the camp of Q1 2016 as in my view a fed hike is not warranted at this time. We aren’t even close to a hike. As the quarter comes to an end we’ll see how earnings play out in the days and weeks ahead.

It’s my view that markets continue to be Fed-dependant, fretting over a single change in FOMC statement wording and overstating just how much monetary policy can accomplish in advanced economies in regards to creating inflation. As market participants continue to be “morally outraged” by events going on in the market and in the world like it or not this is the world we live in.

For better or for worse.