(B) I watched Blackstone Q4 quarterly webcast, titled “no clarity until 2022”, on the financial markets. That webcast was prepared by Blackstone’s Byron Wien and Joe Zidle. I enjoy listening regularly to Byron Wien’s expertise to understand the trends in capital markets.

You can look at the webcast and the slides here. As always, this webcast provides a wealth of insights about the economy.

Key takeaways:

Global:

• China is leading the recovery as the first country to have recovered to pre-COVID levels of economic activity
• Recovery is uneven in less-developed economies

US:

• Payrolls in low-wage industries remain well below pre-COVID levels
• Layoffs were concentrated in jobs without ability to telework, and a higher proportion of them are becoming permanent

Policy:

• Permanently large deficits
• Central banks operating as if there were no ceiling to the size of their balance sheets
• No yield to be found in traditional fixed income

Investing:

• Market sentiment at optimistic extreme in recent months
• S&P 500 has exceeded pre-COVID levels, driven by significant outperformance of the FANG+ stocks
• Five largest S&P 500 stocks comprise nearly a quarter of the total index market capitalization — a record high!

Note: The picture above is my dog looking at the Bay Area from the San Mateo Community College.

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