Late last year I wrote a weekly update that focused on the speculative nature of the markets. In that article, I focused on the S&P 500 because I wanted to make a point, namely that owning the S&P 500 did not absolve investment advisers of their fiduciary duty. If you intentionally make the S&P 500 - or any other index [...]
Note: This update is longer than usual but I felt a comprehensive review was necessary. The Federal Reserve panicked last week and spooked investors into the worst week for stocks since the onset of COVID in March 2020. The S&P 500 is now firmly in bear market territory but that is a fraction of the pain in stocks and other [...]
Dimon says brace for U.S. economic 'hurricane' due to inflation "It's a hurricane," Dimon told a banking conference, adding that the current situation is unprecedented. "Right now, it's kind of sunny, things are doing fine. Everyone thinks the Fed can handle this. That hurricane is right out there down the road coming our way. We just don't know if it's [...]
Something very important happened last week. No, it had nothing to do with the stock market, at least not directly. There was a lot of volatility in stocks last week but in the end, the S&P 500 was down a mere 21 basis points (0.21%). Yes, growth stocks continued their march toward reality with the NASDAQ 100 down 1.25% but [...]
Well, that was an ugly week. Of the six major assets we track, only one was up last week - REITs. Large and small-cap stocks - down. General commodity indexes - down. Gold - down. Bonds - down. The early part of the week was actually pretty calm but Thursday and Friday - especially that close on the low Friday [...]
Well, that didn't last long. I wrote last week about the inversion of the 10-year/2-year term spread as the yield of the 2-year Treasury note rose above the yield of the 10-year Treasury note. Using end-of-day data, the curve inverted on Friday, April 1st, and stayed that way until....Monday, April 4th. The spread closed last Friday, April 8th at 19 [...]
Why did stocks sell off in recent months? Was it the emergence of the Omicron variant? That was a popular narrative right after Thanksgiving but that lasted less than a month before stocks decided to look past COVID make a new high right after the new year. Was the correction due to fears of the Fed raising interest rates and [...]
What do American consumers know that Jay Powell and the FOMC apparently don’t? Certainly, those voting policymakers at the Federal Reserve are going to start raising their policy rates for political reasons under pressure from politicians facing deeper and deeper economic scrutiny for every dollar higher in crude oil. The Fed, however, can’t extract any additional supplies of black gold [...]
Most Americans understandably have tunnel vision when it comes to the American CPI and what it might portend for their personal circumstances. Gasoline prices and those for anyone trying to buy a car or now rent some kind of shelter, the threat is immediate. From this palpable sense, the word “transitory” today might just seem offensive.Yet, it may prove itself [...]
Oil has easily, it appears, rebounded after having moved lower in November. It bottomed out that first big day of omicron fear on December 1 (ironically, or not, the same day the eurodollar futures curve inverted). Since a low of just over $65 (WTI), crude’s front futures price is easily back in the $80s thereby threatening to make January’s US [...]
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