If we know that bad times are temporary and progress is undefeated, why is it so hard to stay invested when stocks fall? I buy the argument that there are some evolutionary things going on in our genetic makeup. Better to run first and ask questions later. But if we put that to the side…...
The rise in inflation and the Fed’s reaction to it has been a real headwind for valuations this year. However, it’s also been a tailwind for earnings. Now, we are on the other side of that mountain, and operating leverage is rolling over likely more than the consensus expects. Be careful what you wish for…Inflation…...
While investors, traders and all market participants await the latest Consumer Price Index (CPI), due out this Wednesday, here are some interesting thoughts and analysis from around the web. The above tweet from the Kobeissi Letter Twitter account is typical of the account holders bearish sentiment that pervades many investors. We strongly encourage avoiding such…
Macro Strategy—Powell On A Mission: U.S. policymakers responded to the pandemic shutdowns with the most aggressive fiscal and monetary stimulus in over 75 years (Exhibit 1). As a result, monetary policy since the pandemic is most like that of the years right after World War II (WWII). Strong M2 money-supply growth in the mid-1940s was…...
Is the market solidifying a bottom with a new uptrend having commenced since late June? Today’s conversation offers several indicators and historic technical guide posts that suggest investors should be looking to increase equity market exposure in the coming weeks and months if the historic probabilities repeat, if not rhyme. To watch the corresponding video…
Research Report Excerpt #1 That’s right. This past trading week was strong, but it wasn’t “uber” strong, as the kids say! In late May, the S&P 500 had a weekly gain of greater than 6%, as outlined below: From May 20th to May 27th, the market rallied greater than 6%. One step forward, but unfortunately that…
So this just happened: The S&P 500 gained 3.9% from the day of the Fed hike through the following trading day. That is officially the best rally after a Fed hike going back to 1970 (Bloomberg data). Not only that, the S&P 500 kept going on Friday, finishing the week up 4.26 percent. The benchmark…...
“Waiting helps you as an investor and a lot of people just can’t stand to wait. If you didn’t get the deferred-gratification gene, you’ve got to work very hard to overcome that.” ~Charlie Munger Side Note on Fed: I can’t see FOMC members appreciating the market’s reaction to their message, outlook and July rate hike.…...
Key talking points Aggregate retail inventories have been steadily improving as demand for goods moderates and supply chain bottlenecks ease. The retail inventory to sales ratio has ticked up from the Oct 2021 trough, yet it is still below the 2011-2019 average. That said, the story varies across sectors. At one extreme, general merchandise stores…...
Research Report Excerpt #1 Over my career, I have experienced 7 market shocks, including the bursting of the technology bubble, the global financial crisis, and now COVID-19. I mention these events only to highlight the fact that market disruptions are a fact of life. It’s just a matter of time before the train goes off…
