— There is mounting evidence that the current bump in inflation is just the beginning of a longer-term trend toward higher prices. — Higher labor costs, insourcing to secure our supply chain and exogenous pressures on raw materials will be the main culprits. — The media will have a field day since this supposed bad…
Tapering isn’t Tightening and Delta dissected
— The media wants you to believe that the tapering of quantitative easing is a big deal with a potential bad outcome (“if it bleeds, it leads”) … the exact opposite is the case. — Covid Delta as a weapon of mass economic destruction … another media obsession … is this round two? — Why the facts on the ground would…
A fact that is not completely factual: The market sets record highs!
— Record market highs we are experiencing relate more to capitalization weighted indices than strength in the average stock composing those indices — Tear apart the numbers and the results show we have been in a significant downturn in the simple average stock since February 2021 — “Aren’t you worried? The market just keeps going up and up!”…
What’s bugging’ this market? Record highs and no celebrations
— A series of new all-time index highs but no popping of corks — A flight to safety goes on under the surface–a 1.25% yield on the 10-year Treasury July 7, couple with a ‘risk off’ 7% drop in the Russell 2K since July 1 — Are we headed for an economic slow-down or recession? This question…
“The bond market agrees with the Federal Reserve — inflation is temporary” Huh!
— “Inflation has peaked.” — “The rate of growth has peaked at home and abroad, as well.” — “Investors of all stripes, foreign and domestic, are offsetting their exposure to equities by purchasing high quality Treasuries to provide ballast in their portfolios.” — “The spread of the Covid delta variant may slow global growth if…
The Stock Market: Dazed and Confused to The Max
— Two key historic characteristics of the stock market: It works to confuse and confound the maximum number of people most of the time while providing excellent long-term returns. — So-called “hawkish” commentary by the Fed is credited with sending stocks into a tailspin while, strangely enough, buyers showed up for the US Treasury 10-year which’…
Fed OMC day: Usually a good day be a stock buyer!
— Market history of the past 11 years confirms this assertion. — It is a gift given to us by the media … tales “full of sound and fury, signifying nothing.” –Today’s report was par for the course, causing a knee-jerk 382 point drop in the Dow followed by a barrage of inane, Powell parsing commentary….
Green Energy Throws Fossil Fuel a Life Line!
–The world goes green. Is that bad for conventional energy producers? –Game plan for a gravy train collapse –Supply response vs. higher prices may be different this time –As convoluted as this might seem green may be good for fossil fuel producers for some time to come. No Question: the world is going green Climate…
Taper Myths–Don’t let Them cost you money!
–The Fed can’t taper Quantitative Easing without really hurting the market. –Tapering of QE will signal a shift by the Fed to tighter monetary policy –Tapering will signal the end an era of Fed ease and the onset of higher inflation and interest rates, the market’s eventual downfall. –The “Worst” case and what happened to stocks,…
Leaping to the Wrong Conclusion
Leaping to the wrong conclusion is a daily event the stock market. Friday’s Jobs report provided a quintessential example. A retreat to the covid 19 playbook provides a comedy of errors ending in new all-time highs for both the Dow Jones Industrials and S&P 500 with the Nasdaq composite, up on the day but down…