A recent PunchLine Presentation packet

1. ABRAHAM GULKOWITZ
abe@gulkowitz.com
917-402-9039
2017 issue 17September 17, 2017
Storm Tracks …
Given the huge hit from natural disasters, growth in the U.S.is already proving to be dented in the near term, but the massive cleanup and rebuilding will offer
growth upside for some time. The magnitude of the disruption is evident from the petrochemical complex in the Texas region. With as much as 54% of US
ethylene capacity and 40% of US propylene capacity shut down at the peak of the storm impact, prices in vinyl, polyethylene, polypropylene, etc have lifted and
disruptions in supply/demand will continue into the fourth quarter. Over the years the U.S. petrochemical complex has become more concentrated than ever
before, and obviously that poses distinct risks. The good news is that both Texas and Florida are vibrant states. With massive space for growth, relatively low
cost of living and taxes, they remain states where populations are rising via interstate migration. That contrasts with the New Orleans region where growth
has never returned to previous peaks or some other regions around the U.S. that might be far less vulnerable to massive storms and hurricanes, but the
population drain has accelerated in recent years.
Houston important for US data sampling
The Census Bureau conducts nationally representative household
surveys used to generate important statistics such as the monthly
unemployment rate, housing characteristics, consumer expenditures,
etc. All of these surveys are based on samples of housing unit
addresses. Persons that have been displaced by Hurricane Harvey
will no longer be at those addresses when the Census interviewers
arrive or call, resulting in these households being listed as vacant.
Without going into great detail these statistical series based on these
surveys may be significantly affected even as the Census Bureau will
make every effort to account for this disruption.
Low Wage Growth Challenges Fed
Tight Labor Markets Not Producing
Faster Wage Growth
Irma, while still a major disaster, wasn’t nearly as bad as many had
feared, resulting in a massive “relief rally.”
Hurricane Irma destroyed a quarter of the homes in the Florida Keys and badly
damaged many more, federal officials said Tuesday, as millions of people in the
nation’s Southeast remained without power.
VIX Spiked and then…
Treasury yields dipped further amid
geopolitical concerns. Longer-term rates are
at the lowest level since the elections. The yield
curve continues to flatten, with the 10yr – 2yr
spread moving below 80 bps.
Southeast
Electric Utilities Are Financially and Operationally Resilient
Stocks in Brazil Hit 9-year High
Americans Get Taken for a Ride at the Pump
Grocery shares continue to
underperform amid expectations
that Amazon will shake up sector
Oil could be rebalancing
but US shale will cap prices
Prices for future oil delivery are lower than prices now,
discouraging storage, cutting supply and rebalancing markets Harvey fallout sends Asian LNG price to 7-month high
Prices for the gas climbs as US storm disrupts the supply chain
The dollar’s weakness is the rest of the world’s problem
US industrial output shrank 0.9% mom in August, following an upwardly revised 0.4%
gain in July and missing expectations of a 0.1% increase. It is the first drop since January
as Hurricane Harvey stopped oil and gas production in Texas.
Hurricane Harvey temporarily curtailed drilling, servicing, and extraction activity for oil
and natural gas. The output of utilities dropped 5.5 percent, as unseasonably mild
temperatures, particularly on the East Coast, reduced the demand for air conditioning.
RETAIL: Women's shoe retailer Aerosoles Group said it had
filed for Chapter 11 bankruptcy protection, the latest casualty
in a struggling retail industry. The company had listed assets
of $10 million to $50 million and liabilities of $100 million to
$500 million, according to its bankruptcy court filing.
Equifax bonds are tumbling as investors become concerned
about the company’s ability to survive the hacking fiasco
The weak August retail sales report reflects
the limited wherewithal Americans have to
spend more… Even Online Sales Slump
Rig Count Tumbles Most In 8 Months
Disasters in Texas and Florida

2. The PunchLine...
2
September 17, 2017
In This Issue
Headlines and data appearing in The Punch Line came from widely available publications including
national and international newspapers, trade journals, economic and industrial bulletins and news websites.
• SuperVision… (pg 6)
• A Fuller View… (pg 7)
• Households… (pg 8)
• Alternative Facts
• Consumer Perspectives (pg 10)
• Dislocation, Dislocation (pg 11)
• The Likelihood of Unlikely Events... (pg 12)
• Credit (pg 13)
• The DNA of Business… (pg 14)
• Real Estate and Construction… (pg 15)
• Select Real Estate (pg 16)
• Will Life Ever be the Same? (pg 17)
• Storm Tracks . . .
Given the huge hit from natural disasters, growth in the U.S.is already proving
to be dented in the near term, but the massive cleanup and rebuilding will
offer growth upside for some time. The magnitude of the disruption is evident
from the petrochemical complex in the Texas region. With as much as 54%
of US ethylene capacity and 40% of US propylene capacity shut down at the
peak of the storm impact, prices in vinyl, polyethylene, polypropylene, etc
have lifted and disruptions in supply/demand will continue into the fourth
quarter. Over the years the U.S. petrochemical complex has become more
concentrated than ever before, and obviously that poses distinct risks. The
good news is that both Texas and Florida are vibrant states. With massive
space for growth, relatively low cost of living and taxes, they remain states
where populations are rising via interstate migration. That contrasts with the
New Orleans region where growth has never returned to previous peaks or
some other regions around the U.S. that might be far less vulnerable to
massive storms and hurricanes, but the population drain has accelerated in
recent years. (pg 1)
• In This Issue (pg 2)
• You Can’t Handle the Truth ! (pg 3)
• The Future Ain’t… (pg 4)
• Engines of Growth
Despite a run of global statistics offering relief, confusing stress signals are still
emanating from around the globe . Uncertainties -- particularly from natural disasters,
terror and geopolitical concerns here and abroad, Brexit, dangerous issues regarding N
Korea, China, Iran and others - - continue to confound investors and contribute to
intermittent bouts of haven seeking investment moves. But let’s not forget that many of
the challenges are not fleeting, and many cannot be resolved easily or quickly… (pg 5)
Contact information:
Abraham Gulkowitz
phone: 917-402-9039 email: abe@gulkowitz.com

3. The PunchLine...
3
September 17, 2017
You Can’t Handle the Truth…
Let'sTake the “Con” out of Economics
Industrial pollution tests
Harvey clean-up operation
Economists lowered their
forecasts for U.S. economic
growth in the third quarter
by 0.8 percentage point to
2.0 percent, based on an
expected slowdown in
business activity due to
damage from Hurricanes
Harvey and Irma. "If
damages are significantly
higher — or if Florida
flooding continues to weigh on
consumer spending and
housing/investment activity
into late September and
October — we would expect
additional downside to near-
term growth," they wrote in a
research note released late…

4. The PunchLine...
4
September 17, 2017
The Future Ain’t What It Used To Be
CHINA EXPORTS
--------------
Growth YoY
--------------
JUNE 11.3%
JULY 7.2%
AUG 5.5%
The hurricane’s devastating floods hit the nation’s fifth-largest metropolitan area,
Houston-The Woodlands-Sugarland, and although the final assessment of damages
is likely months away, it is possible that Houston faces many of the challenges
Hurricane Katrina created in New Orleans. A wide swath of homes face significant
water damage that will be difficult to repair, particularly as less than 20 percent of
homeowners have flood insurance in the hardest hit areas. The remaining
homeowners will be dependent on private charities and government aid, such as
grants from FEMA and low-interest rate loans from the government. When
compared with the area affected by Hurricane Katrina, the area hit by Harvey has
more than twice as many properties with mortgages and nearly four times the
unpaid principal balance. The damages could result in a significant wave of
delinquencies as homeowners grapple with the recovery process. This will place a
strain on the local and regional housing market as a number of homeowners could
walk away from damaged homes.
Venezuela… the currency remains in freefall. It
takes a suitcase of bolivars now to buy one dollar.
China's exports grew at a slower pace in August, data
from the General Administration of Customs revealed.
Exports increased 5.5 percent year-on-year in August,
slower than July's initially estimated 7.2 percent growth.
At the same time, imports advanced 13.3 percent
annually, faster than the expected growth of 10 percent.
China retail sales, investment
growth slower in August

5. The PunchLine...
5
September 17, 2017
Engines of Growth…
US Car Sales Wheeze After Long Climb
U.S. auto industry sales continued to slump in
August amid mounting signs that American car
buyers have become more fickle following a
seven-year growth streak While General Motors
Co. and Toyota Motor Corp. notched relatively
strong gains, fueled in part by heavier discounting,
others reported lower results, with some citing lost
sales tied to Hurricane Harvey. U.S. light-vehicle
sales in August fell 1.9% from a year earlier,
according to Autodata Corp. The industry’s
annualized selling pace, a measure of how sales
are tracking for the full year, was 16.14 million
last month, below analysts’ expectations and down
from 17.22 million a year ago. The weaker
performance comes despite last month having an
extra selling day. GM’s August sales jumped
7.4% from a year earlier, totaling 275,552
vehicles, as the Detroit giant deepened discounts
on many SUV models, aiming to make room on
dealer lots for newer versions
The Outlook for Crude: Lower for Longer
Farm Incomes Seen Rising, Reversing Mulityear Slump
USDA says farm profits still only about half of 2013’s record levels
Rising profits are a relief to many farmers squeezed by the multiyear slump
in the agricultural economy. Analysts nevertheless expect a continuing grain
glut to pressure prices this year, with forecasts showing another year of
bumper U.S. corn and soybean harvests after those crops appeared to recover
from early weather troubles. Meanwhile, rising production in countries like
Brazil and Russia is adding to global stockpiles. The agency said crop
receipts will be largely steady in 2017, up 0.3% from a year earlier, with
soybean and cotton receipts rising. Crop sales volume is expected to increase
even as prices decline.
HOUSTON AREA
Half million cars damaged/destroyed
When it comes to slow pay increases, the US, of course, is not unique.
Japan’s tight labor markets, for example, have not driven the nation’s
wage growth higher
Hurricanes and Tropical Storms Disrupt Travel Across the Southeast U.S. and Caribbean
Beijing wants more people to rent. More leases and
fewer mortgages could put China’s overheated property
sector on a more sustainable footing, plus increase
economic efficiency. But the initiative is pitted against
social prejudice and commercial interests, and it might
entail an economic sting. Officials will struggle to
administer this medicine
Europe bursts out of its Brexit blues
These are unexpectedly good times for the European Union. More
than a year after Britons voted to withdraw from the organization, the
euro has hit eight-year highs against the pound, eurozone economies
have recorded improved growth and voters have rejected far-right
populists in France and the Netherlands.
Downgraded from a hurricane to a tropical storm, Irma flooded several northern Florida cities with
heavy rain and a high storm surge on Monday as it headed out of the state after cutting power to
millions and ripping roofs off homes. Irma, once ranked as one of the most powerful hurricanes
recorded in the Atlantic, hit a wide swath of Florida over the past day, first making landfall on the
Florida Keys archipelago and then coming ashore south of Naples before heading up the west coast.
A state that the big insurers fled after Andrew is
now covered by smaller companies that could
lean on their own insurance policies to pay out to
property owners.
Updating Needed…
The French private sector is struggling with high “social protection”
expenses which drive up labor costs
While Irma didn’t do that much damage to cotton
crops, the situation with Florida’s citrus groves is
entirely different
EU wants more taxes from Tech Sector
China’s crude oil production has been trending lower, which is
helping Russia and OPEC to keep supplies closer to their target

6. The PunchLine...
6
September 17, 2017
Super Vision - Select Signals
Loonie Soars After Bank
of Canada Unexpectedly
Hikes Rates by 25 bps
EU markets watchdog warns
investors of market bubble threat
Rock-bottom interest rates and political uncertainty such
as Brexit mean risks of an asset price bubble are at their
highest, a European markets watchdog said on Tuesday,
in an unusually strongly worded warning to investors.
In a report, the European Securities and Markets
Authority (ESMA) cautioned that “market and credit
risks were very high”, pointing to the threat of contagion,
or a spillover of problems to other parts of finance. It
said “valuation risk”, a reference to the price of
investments, was at the “highest levels due to financial
weakness and geopolitical uncertainty”. The warning
carries weight because the agency has deep insight into
markets across the 28-member European Union.
Although it mirrors concerns long held by some bankers,
it is in stark contrast to efforts last week by the president
of the European Central Bank, Mario Draghi, to play
down fears that markets are overheating.

7. The PunchLine...
7
September 17, 2017
A Fuller View… Data Insights
Non farm payrolls in the US increased by 156K in August,
below a downwardly revised 189K in July and a 210,000
June gain … Together these two previous figures were revised
down by 41,000. Job gains occurred in manufacturing,
construction, professional and technical services, health care, and
mining. The number of Americans over age 16 who are not in the
labor force – for whatever reason – remained stubbornly high in
August, at 94,785,000. That is partly attributed to the rising
number of retirements among Baby Boomers.

8. The PunchLine...
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September 17, 2017
Households – Brave New World
Fed member Ms. Brainard, while upbeat about the
U.S. economy and its outlook, warned that Hurricane
Harvey and its devastating impact on Texas and its
energy firms, will affect the U.S. outlook for a time.
The market for new motor vehicles has deteriorated markedly this year in
the US. Total sales of light vehicles declined 3.7% during August (-6.3% y/y)
to 16.14 million units (SAAR) from 16.77 million in July, according to the
Autodata Corporation. It was the lowest level of sales since February 2014,
off 11.1% from this past December's peak.
After a lost decade, Americans finally have begun
making real gains, according to a report released
Tuesday by the U.S. Census Bureau. The agency
released data on income, poverty, and health
insurance for 2016. The highlights include:
⁎ The median household income was $59,000, up
3.2 percent from 2015.
⁎ The poverty rate in 2016 ticked down by 0.8
percentage point to 12.7 percent. There were
40.6 million people living in poverty.
⁎ The supplemental poverty rate — a measure
developed during President Barack Obama's
administration as a better measure of poverty —
was 13.9 percent, slightly less than in 2015.
(The statistic is based on whether people have
enough money to pay for basic needs.)
⁎ The number of Americans who did not have
health insurance for the entire year was 28.1
million, or about 8.8 percent, a decline of 0.3
point from 2015.
US Retail Sales Unexpectedly
Shrank in August
CPI New cars are experiencing the
worst deflation since the Great Recession.

9. The PunchLine...
9
September 17, 2017
Alternative Facts- Careful Reading
Small Business Optimism Index increased slightly in August
Latest NFIB report showing that quality of labor
is becoming an issue for more small businesses.

10. The PunchLine...
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September 17, 2017
Consumer Perspectives

11. The PunchLine...
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September 17, 2017
Dislocation, Dislocation, Dislocation
Currency Tumult
China’s Currency Rebounds as
Economic Optimism Returns
The Canadian dollar firmed against the U.S. dollar, supported by
further gains in Canada's bond yields after the country's central bank
surprised some investors recently by raising interest rates. A string of
robust economic news pushed the Bank of Canada to hike rates for the
second time in three months, a move that helped drive the loonie
nearly 2 per cent higher last week. The July move was the Bank's first
hike in nearly seven years.
Millions who buy health insurance brace for sharp increases
Millions of people who buy individual health insurance policies and get
no financial help from the Affordable Care Act are bracing for another
year of double-digit premium increases, and their frustration is boiling
over. Some are expecting premiums for 2018 to rival a mortgage
payment. What they pay is tied to the price of coverage on the health
insurance markets created by the Obama-era law, but these consumers
get no protection from the law's tax credits, which cushion against rising
premiums. Instead they pay full freight and bear the brunt of market
problems such as high costs and diminished competition
Lumber prices jump
(concerns about supply disruptions)
U.S. Factory Orders Backpedal
UK: Given the recent unexpected jump in inflation (driven by
the pound’s weakness), the BoE is seriously considering rate
hikes in the next few months.

12. The PunchLine...
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September 17, 2017
The Likelihood of Unlikely Events
Russia said it would respond harshly to any U.S. measures designed
to hurt it, a day after the United States told Moscow to close its San
Francisco consulate and buildings in Washington and New York.
U.S., Mexico Spar on NAFTA
Both sides threaten to pull out of trade pact as
talks to renegotiate it kick off in Mexico City
DANGER: The Big Data revolution could revive the planned economy
Hurricane Irma …
“Monster" Irma Appeared as the Strongest Atlantic Hurricane on Record
Debt Ceiling Trauma… Four Wk Bills Price Rose to
Highest Yields Since Sept 2008 on Technical Default Fears
It’s ironic that Canada’s inflation has been moving
lower while Swedish inflation has been rising. And
yet the Riksbank remains extremely dovish while
the BoC moved to raise rates…
Qatar’s stock market hits the lowest level since
early 2016 as the sanctions take their toll.
South Korean CDS spread has been on the rise again
Italy is the most eurosceptic country in the Eurozone
Cyberattack on Equifax Exposes Personal Information of ? Millions
The future of the BRICS looks toxic. China and India
stepped back from a border dispute just in time for a
summit of the bloc of large emerging market
countries. That helps Chinese President Xi Jinping
keep up appearances ahead of a crucial political
reshuffle. But the unusual tensions between the two
Asian giants suggests the three-day gathering
underway could be a last hurrah. Brazil, Russia,
India, China and South Africa are united in their
opposition of a Western-led global order. So Xi’s
fresh call for an open world economy is easy for
members to get behind, amid a rising tide of
protectionism in developed markets to which exports
flow. Since starting to group together roughly a
decade ago, the BRICS have wrung concessions from
a global climate change agreement, and have
improved their position in international bodies such as
the International Monetary Fund.
Catalan vote may go ahead
despite Madrid’s opposition
Pro-independence parties are determined to hold the referendum, despite Madrid’s efforts to
prevent it The Spanish government said on Friday it had passed measures to increase control
over how Catalonia spends its money in an effort to block the regional government from using
state cash to pay for an illegal independence referendum. “These measures are to guarantee
that not one euro will go toward financing illegal acts,” Budget Minister Cristobal Montoro said
following the weekly cabinet meeting.
Stocks in Brazil Hit 9-year High
Backlash against Brazil’s corruption probe grows
Political class fights back as criticism grows of over-reach by the judiciary
Policy uncertainty curbs South African
companies' efforts to boost credit quality
Nigeria to resist cuts to its oil output, minister says
Emmanuel Kachikwu says country needs more time before
joining OPEC supply deal
Hurricane Irma may bring long-term costs for Caribbean
Unprecedented vituperation at the Arab League shows how far
relations between Doha and its neighbours have deteriorated
Storm impact on home, car, and boat markets
Opioid epidemic out of control
Yield-hungry investors are jumping
into the less liquid bond markets

13. The PunchLine...
13
September 17, 2017
Credit Matters - Know Risk
Many Excel in Strategy, Few in the Management of Risk
China’s small-loan providers have virtually halved lending as the
slowing economy turns both lenders and borrowers more wary of risk.
New loans from China’s 8,591 small-loan providers came to just
Rmb89bn ($14.5bn) in the first nine months of 2014, virtually half the
Rmb161bn level in the same period last year, according to central bank
data. Policy makers have encouraged the rise of small-loan providers
– which typically range from Rmb50,000 to Rmb5m – since a wave of
defaults on informal debt in the light manufacturing hub of Wenzhou
in 2011 sparked bankruptcies and several suicides.
Leveraged loan issuance has been brisk this year
Retail Bloodbath After Target Announces
Price Cuts On "Thousands Of Items"
Equifax Hit With $70 Billion Lawsuit After
Leaking 143 Million Social Security Numbers
US company debt sales power
ahead as borrowing costs drop
Investment-grade (IG) credit default
spreads are near multi-year low
At the same time, investment-grade corporate leverage
just hit record highs. How dangerous is this? Could
corporate credit turn into the catalyst that might end
the current economic expansion?
Qatar’s stock market keeps tumbling (19-month low)
as the blockade takes its toll. The nation’s banks are
facing significant withdrawals and higher funding
costs.
Investors lined up to buy an Austrian
government bond that won’t be repaid until
September 2117, the first public, century long
bond issued by a government in the eurozone
Retailers that already were doing well before the
hurricanes that hit Texas and Florida will do even
better, and many that were already doing poorly
will do worse.
Bitcoin is drifting lower after Beijing moved to shut China’s
exchanges and Jamie Dimon called Bitcoin 'a fraud’
One of the largest sources of Bitcoin can be found in the grasslands of Inner
Mongolia, despite Chinese skepticism over its potential for risk.
Nearly 75% of the performing high yield
market is bid over par, up from 63% at year-
end 2016, though retail continues to struggle
Is US dollar being replaced by other currencies? Actually,
in the past 7 years the dollar has increased its share of use
in global payments.
Equifax Hack Attack
Uncovers deep vulnerability in household credit system
Banks in Japan, Canada and Europe behind
on automating operations to cut costs
Credit agency Equifax traced the theft of sensitive information about 143
million Americans to a software flaw that could have been fixed well before
the burglary occurred, further undermining its credibility as the guardian of
personal data that can easily be used for identity theft. Equifax identified a
weakness in an open-source software package called Apache Struts as the
technological crack that allowed hackers to heist Social Security numbers,
birthdates, addresses and full legal names from a massive database maintained
primarily for lenders.
The International Monetary Fund says that China's
credit growth is on a "dangerous trajectory".
In a new report, the IMF says there is an increasing risk of a
"disruptive adjustment" and/or a marked slowdown in economic
growth". The agency calls for decisive action to deflate the credit
boom smoothly. Without the boom, the report suggests, China's
recent economic expansion would have been significantly slower.
Since the global financial crisis, China's economic growth has
slowed, from an average of 10% a year in the previous three decades
to a rate of 6.7% last year. The Chinese government expected a
slowdown, since the earlier double-digit rate was not sustainable
over the long term.
Severe US Retail Shock Could
Fan Out to REITs and CMBS
A hypothetical rapid rise in Amazon's U.S. apparel market
share could have significant credit implications for existing
retailers, REITs and CMBS transactions. Sharp declines in
retailer revenue and margins and accelerated store closings
would likely drive significant cash flow erosion and weaken
credit profiles for apparel-focused retailers, mall REITs and
retail-heavy CMBS deals in such a scenario.
Several U.S. high yield companies have interest
payments scheduled for Sept. 15 which, if not made
would move the default rate above the current 1.8%
mark, and includes two large retailers.
The value of marketable federal government debt
reached a new high of just over $14.5 trillion.

14. The PunchLine...
14
September 17, 2017
The DNA of Business
Reconfiguring Industries to Define Growth
Digital technology was finding its way on the factory work floor and
offices in a big, big way in a very positive, broad fashion,” Charles
Evans, president of the Federal Reserve Bank of Chicago, said in an
interview. “It makes you wonder if competition is beginning to take
place along lines that haven’t been contemplated. Competition in
many forms would adjust price margins
Globalization might help drive unemployment down at home without
affecting broader inflation trends. U.S. workers now compete with
workers from around the world. An abundance of low-wage workers
in China and other developing economies could hold down wages and
prices in the U.S. in ways that didn’t happen a decade or two ago.
Likewise, technology could be reshaping the interplay of
unemployment and inflation: Amazon.com Inc., the internet retailing
giant that uses advanced robotics to manage sophisticated warehouse
planning, plans major price cuts at Whole Foods Markets Inc., which
it recently purchased.
Kroger Braces for Amazon
Grocer needs to show it can defend its turf against online power
Kroger Co. is looking for a sales bump to show investors and analysts it can
withstand Amazon.com Inc.'s rapid advance in the grocery business.
Shares in the nation's largest supermarket by store count and sales have slid
35% this year, erasing more than $7 billion in value. Investors are watching
whether Kroger and other grocers can hold on to customers after Amazon's
takeover of Whole Foods Market Inc. The company reports second-quarter
results on Friday. Deep-discounting European chains and online grocers
are also threatening Kroger's market share. Food retail stocks are down
nearly 20% this year, according to FactSet. Kroger has been confronting
the multitude of headwinds by slashing prices on staples, adding online
ordering options and meal kits in some stores, and investing in technology
to better market to consumers. It is slowing store growth, offering voluntary
buyouts and ramping up other cost-cutting efforts to do so.
Tronc buys New York Daily News
Newspaper company Tronc Inc , which owns the Chicago Tribune
and the Los Angeles Times, said it acquired the New York Daily News
from media and property mogul Mort Zuckerman. Tronc, the
publisher of the Los Angeles Times and the Chicago Tribune, has
bought the New York Daily News. Tronc will assume control of the
paper's operations, its printing plant in Jersey City and its pension
liabilities, the New York Times said. No cash will change hands but
Tronc is assuming $30 million in pension liabilities, Reuters is
reporting. The deal gives Tronc newspapers in the biggest three media
markets, Chicago, Los Angeles and New York.
Intel has won a point in its antitrust battle with the European
Commission — and the American technology industry as a whole
may be feeling a little victorious as well. The Court of Justice of the
European Union ordered a lower court on Wednesday to re-examine
the 1.6 billion euro, or nearly $1.3 billion, fine imposed on Intel in
2009 for abuse of its dominant position in the computer chip
market. The decision is a setback for the European Union antitrust
authorities who have been investigating American tech giants like
Google and Qualcomm.
Buying Rockwell Collins for $23 billion was meant
to be a crowning achievement for United
Technologies, but it had a different effect on
the purchaser’s share price, which fell nearly 6
percent on Tuesday. What’s the problem?
Skeptics call it an expensive proposition with
few clear benefits.
Lego Hits Brick Wall as Digital Play Grows
The maker of Legos, long immune to the struggles
weighing on other toy companies, reported its first
sales drop in 13 years, betraying cracks in its strategy
to compete against a rising array of digital distractions
for children.
Toys R Us Could Seek Bankruptcy Protection to Deal With Its Crushing Debt
Nestlé Is Buying Vegan Food-Maker Sweet Earth
Another bet on healthier and environmentally-conscious foods
Why Blockchain Will Change Everything
From insurance, to airplane manufacturing, to tracking a fruit's shipment
history, blockchain is a powerful tool that is already revolutionizing business.
The next oil major?
Service firm Schlumberger's big bet on production
The world's largest oilfield services company, Schlumberger NV , is
spending billions of dollars buying stakes in its customers' oil and gas
projects - investing in the same ventures it supplies with equipment and
expertise. The new business model gives Schlumberger a say in drilling
decisions, oilfield management and even on hiring other Schlumberger
units for service contracts, the company has told investors. The expanded
operational authority saves Schlumberger from bidding for each of the
many jobs that typically require separate contracts on a large drilling project
- effectively locking out the firm's competitors.
The media landscape is undergoing a massive rewrite
on every level, from the formats that content is taking
to how it is distributed and consumed
Electric Cars Won’t Offset Diesel Sales Drop in Europe
Cord-Cutting Explodes:
22 Million U.S. Adults Likely to Cancel Cable, Satellite TV in 2017
Cable & Satellite TV Prices Spike

15. The PunchLine...
15
September 17, 2017
Real Estate and Construction Outlook
The toll of Hurricane Harvey continues to mount as residents join government
officials and insurance companies in assessing the destruction. Damage to
200,000 homes across the region as well as infrastructure and commercial
properties will create significant short-term hurdles, but Houston is uniquely
positioned for recovery.
The Dodge Momentum Index moved lower in August,
falling 2.4% to 129.1 (2000=100) from its revised July
reading of 132.2. The Momentum Index is a monthly
measure of the first (or initial) report for nonresidential
building projects in planning, which have been shown to
lead construction spending for nonresidential buildings
by a full year. The decline in August can be attributed to
an 8.7% drop in the commercial component of the
Momentum Index, while the institutional component
rose 7.3%. The commercial component has seen a steep
rise over the past year as large projects – particularly
office buildings – entered the planning cycle. The
August retreat for the commercial component brings
planning activity back to a level more consistent with a
sustainable pace of development.
In August, eight projects entered planning each with a
value of $100 million or more. For the institutional
building sector, the leading projects were the $230
million University of New Mexico hospital replacement
project in Albuquerque NM and a $218 million high
school in Aledo TX. The leading commercial building
projects were the $205 million Niagara Falls Grand
Hotel in Niagara Falls NY and a $178 million Amazon
fulfillment center in Salem OR.
China’s latest crackdown on capital outflows and
corporate leverage could come back to hammer
NYC’s commercial real-estate market, leading to an
84% drop in overseas property investment by
Chinese corporations during 2017, and another
18% in 2018, potentially resulting in a sharp decline
in prices. (Morgan Stanley )

16. The PunchLine...
16
September 17, 2017
Select Real Estate Reference Points…
An army of 50,000 restoration
workers from across the U.S. and
Canada were working on Florida’s
power grid at ENR press time on
Sept. 12, according to an Edison
Electric Institute estimate. Nearly
65% of the state’s electric
customers had lost power at the
peak of Hurricane Irma’s slam into
the southeastern U.S., including
72% of Florida Power & Light
customers and 73% of Duke
Energy’s. FPL said it had little
damage to generation plants, but it
is assessing damage after reports of
multiple tornados, said Eric Silagy,
FPL’s CEO. The 1,250-MW
Riviera Beach gas-fired plant, near
Palm Beach, had to be shut due to a
huge influx of debris being removed
from intakes. FPL says it expects
far less structural damage to the
system after spending $3 billion,
since 2006, to harden the grid
against storms. Upgrades included
putting 450 transmission lines
underground, replacing poles—
many made of concrete—to meet
strength requirements and
shortening conductor spans. “We
would be replacing tens of
thousands of poles without the
upgrades,” Silagy says. Helicopters
and drones inspecting power lines
found no structural damage.

17. The PunchLine...
17
September 17, 2017
Will Life Ever Be the Same?
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