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school year

METRO photo

By Michael E. Russell

Michael E. Russell

What we do know is that often, history repeats itself. We tell our children that they need to learn from their mistakes.  However, we never seem to follow our own advice. So where are we?

Trying to get a handle on how to manage our investments is proving to be difficult at best. The stock market is following every comment by Federal Reserve Chairman Jerome Powell, hoping for a guiding light. 

This past Friday, stocks dropped after a strong opening despite a solid August payroll report. The report showed solid job growth, increasing labor force participation and slowing hourly wage increases. Perhaps this shows that inflation may have peaked. The report was positive enough to unlikely change monetary policy. In spite of this the S & P 500 Index still fell 1.1% with the Nasdaq Composite down 1.3%. This capped an awful August in which the S&P 500 fell more than 4%. That followed July’s 9% gain, the market’s most solid month in more than two years.

Okay folks, the lesson for today is which month to believe. Is this the start of a new bull market or is it a bear market rally?

Let’s talk about a sector of the market that is extremely perplexing. Social media is probably the most influential innovation of the 21st century. Think about this. In 2022, if an event does not appear on a social feed, it never really happened! Most of Wall Street has been blind-sided by social media’s troubles. With every passing year, digital advertising is near a point where the market is saturated.

Case in point: Facebook. This stock, under its new name Meta, traded at $175 during 2017. This past Friday, it closed at $160. Over the past five years it traded as high as $380. As we have learned this past year, market realities eventually trump technology.  (Note:  trump with a small ‘t’).

I have not spoken about Crypto in a few weeks, so here are some thoughts. If Bitcoin is crypto’s answer to gold, Ethereum is the closest thing it has to its own internet.  For example, any person who wants to mint a new token or spend $150,000 on a Bored Ape non-fungible token, or NFT, probably uses the Ethereum network.

As of today, more than $3 billion in transaction volume flows through Ethereum daily. About $60 billion in crypto assets sit on its blockchain through third-party apps.  Other than Bitcoin, there is no network that is more critical to crypto’s infrastructure going forward.

A stock I have owned, Nvidia, has been a casualty of a slowdown in hardware purchases. Recently, on the company’s last earnings call, it was stated that the stock has suffered from a slowdown in gaming and other core areas. It was also stated it could not predict how reduced crypto mining might hit demand for its products. 

All of this new technology is growing way too fast for me. I am still having trouble learning all of the features on my iPhone. 

With school classes resuming and the holidays fast approaching, here are thoughts on some retailing stocks. Target (tgt) looks to be a cheaper stock based on its P/E ratio than Walmart (wmt). There is a potential for 20% upside from its Friday close of $164.  It trades at less than 16X earnings, while Walmart trades at 22X earnings — a 33% discount. 

On the interest rate front, it looks like Chairman Powell will be calling for two more rate increases of 50 to 75 basis points each. Banks will be charging more for car, personal, business and mortgage loans, while paying little if any interest on your savings accounts. Hmm, not fair!!

Just a thought …With the President’s new plan on school loan forgiveness, would it not be a good idea to convert your 30-year mortgage to a school loan? Probably not legal, also just kidding! On a closing note, I just cannot wait for the IRS to put the 87,000 new inspectors to work. Have a great September.

Michael E. Russell retired after 40 years working for various Wall Street firms. All recommendations being made here are not guaranteed and may incur a loss of principal. The opinions and investment recommendations expressed in the column are the author’s own. TBR News Media does not endorse any specific investment advice and urges investors to consult with their financial advisor. 

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Rocky Point High School. File photo by Desirée Keegan

The Rocky Point school district is battening down the hatches and shoring up its defenses with money from its ongoing capital bond project.

The newly renovated music room in the high school. Photo from Rocky Point

The district has finished phase 2 of its list of projects set after passing a 2016 bond proposal. Much of the work has already been completed, including replacing the aging ceiling and lighting in much of the district’s four school buildings.

“What we did weren’t things that are exciting like adding on a new wing, new classrooms or a new gymnasium, they were basic things to keep serving the students,” Superintendent Michael Ring said.

In 2016 Rocky Point residents voted to let the district borrow $16 million for upgrades and repairs. The first half of the project, amounting to roughly $7 million, was completed in summer 2017. Parts of the second half of the plan, costing approximately $9 million, were completed before the start of the school year Sept. 4, according to the district.

In 2017, residents also approved with a 600 to 312 vote to release $3.4 million in capital reserve funds to work in tandem with the bond projects. That money was used to renovate the district’s music classrooms as well as finishing resealing of the middle school’s exterior brickwork to prevent water penetration. There are also plans for a future reconfiguration of the roadways on middle and high school property. Work is ongoing to refurbish the turf on the high school’s lower field, but Ring said weather has delayed the project. He said it should be completed within the next few weeks.

Renovated locker rooms at Rocky Point High School. Photo from Rocky Point

Last year’s bond work included new boilers and renovated bathrooms at the Joseph A. Edgar Elementary School, as well as adding air conditioning to the high school auditorium. Summer 2018 construction, overseen by Huntington Station-based Park East Construction Corp., provided renovations to the high school’s boys and girls locker rooms and bathrooms. An Americans With Disabilities Act-compliant lift for the high school gym stage was also installed. Along with the work at the high school, the Frank J. Carasiti Elementary School cafeteria had new air conditioning installed.

Ring said the most substantial improvement to district buildings during the past summer was the installation of new LED lighting fixtures throughout the high school and JAE elementary. The new lighting should be more energy efficient, he said, while giving the school the opportunity to replace aging ceiling tiles in places that had not been addressed for close to 50 years, since the high school was constructed.

Work to renovate the middle school’s lighting system will take place during the year after school hours. FJC elementary has had its lighting replaced in the building’s corridors, and the rest of the building’s lighting will be updated in summer 2019.

These lighting fixtures include new “daylight harvesting technology” that will dim the lights depending upon the amount of natural light that enters the room, which Ring said should save on electrical costs. The new lights also have occupancy sensors that will shut off all lights if there is nobody in the room.

“That’s so you don’t see that effect you see when you’re driving down the road and the whole building is lit up, even if it’s 8 o’clock at night,” Ring said.

Newly installed LED hallway lighting at Frank J. Carasiti Elementary School. Photo from Rocky Point

As part of the bond project, the district is also looking to beef up security at its buildings. The district added unarmed security guards to school buildings for the start of the new school year. Rocky Point is also looking to implement a new door access system to reject unwanted intruders as well as “door-ajar systems” that will notify the school if a door is being propped open from the inside.

The district also wants to improve its security camera capabilities by adding more camera coverage as well as installing new facial recognition and license plate reading technology. Ring said those projects are currently on hold awaiting New York State approval. If approved, the district will immediately put proposals out for bid so construction of those security additions can begin before the end of the 2018-19 school year, according to the superintendent.

Ring said he happy with the results of the bond work so far, even as it became stressful to finish ongoing projects before students returned for the start of classes.

“It’s always a relief when it’s done because it’s always a stressful time,” Ring said. “When you look at the end of June and things are getting pulled apart, then hoping and praying they get put back together for September. Hopefully next year’s project will come along, and the same thing will happen.”