Here We Go -- "Fed" Gets Ready To Raise Rates And The Market Is Beginning To Surge After A Lackluster Morning -- September 26, 2018

The market: I assume the market was waiting to see what the Fed would do, but the timing clearly suggests the market was waiting for a presidential tweet from the UN Security Council. More to follow.

Tesla: looking to maximize 3Q18 deliveries, Tesla is trying a number of initiatives. On a side note: in Southlake Town Center, there is a little-used, large parking lot that is inconveniently located for those shopping downtown. At the far side of this parking lot, there is a bank of eight to ten Tesla charging units. I don't see them used much during the day but at night I might see one or two units being charges; generally zero to maybe one. But if any are there, it catches my attention.There's nothing open in the area after 10:00 p.m. and even earlier in the evening, not much to offer in this particular area. Certainly people are not charging their Teslas while they go shopping. The only way I imagine these people getting to and from the charging station is by having a second driver pick them up after plugging their Tesla into the charging unit, and then driving them back when the car is charged. I suppose I could be wrong, but there is simply nothing in the area for anyone to do after parking the car while it is being re-charged. And, these are not out-of-town/cross-country drivers: they are way out of the way from the main state and interstate highways. I suppose if the range is 300 miles and they drive only 30 miles/day, then a single re-charge gives then 10 days of driving, then it makes sense. I see TSLA is up $11 today.

Nuclear plant: too big to fail. [Update: March 7, 2023 -- unit #3 has reached critical mass and soon to go "live."]

Owners of the last remaining nuclear-power plant under construction in the U.S. agreed to keep working, even as rising costs and unpredictable financial risks threaten the half-built project.

After several days of closed-door negotiations, lawsuits and intense political pressure to craft a deal, the owners agreed to finish work on the Alvin W. Vogtle Electric Generating Plant in Waynesboro, Georgia, US.

Southern Co., the project leader, came to a new deal with co-owners Oglethorpe Power Corp., the Municipal Electric Authority of Georgia and Dalton Utilities. The companies didn’t immediately disclose the new terms.

The owners have been struggling for the past couple of years after the designer and lead construction contractor, Westinghouse Electric Co., filed for bankruptcy after costs rose and the project fell years behind schedule. Earlier this year, Southern said the costs had risen again, this time by $2.2 billion. This pushed the total cost estimate above $27 billion, more than twice the original estimate. Under the terms of the partnership, all three major partners needed to vote to continue work. If any voted to stop, the project would be canceled.

The companies faced what amounted to a no-win proposition. If they walked away, they would have faced a political storm over who should pay for the massive sunk costs of the project, which wouldn’t generate any additional electricity but could require customers to pay higher electric rates. But staying meant taking on growing risk that the project’s budget would continue rising.

They faced political pressure. State officials, including Gov. Nathan Deal, urged them to continue work, citing the more than 6,000 construction jobs. The federal Department of Energy also said it would seek an accelerated repayment of loans to the project if work was halted.

Kavanaugh hearings. My hunch is that if the Kavanaugh hearings are extended into next week, the whole process has pretty much unraveled. The tea leaves suggest that the hearings will be extended. Fascinating to watch. If Kavanaugh cannot be confirmed I find it hard to believe that Trump will get a second chance.

Brexit PM and Trump: meeting. Press conference at 5:00 p.m., apparently.

The "Fed": when asked why the economy is doing so well; the questioner suggested it was the "stimulus" -- unsaid what the questioner was referring to. The Fed's first response: higher oil patches are perhaps resulting in more investment in the oil patch, and then he mentioned household and business confidence. But I found it amazing that the one sector he mentioned as a possible reason for the roaring economy: the oil patch. Posted just after the Fed's press conference, 2:36 p.m. CDT, September 26, 2018, just after announcement that the Fed has raised "the rate" by another quarter percent. The 10-year bond: 3.065% (down slightly). Most indices are slightly positive. The Dow (irrelevant) is fluctuating around "flat" -- up a little, down a little. By the way, the Fed says the rate right now is about "perfect" -- which if accurate means that the December rate rise is not a foregone conclusion.