It is hard to keep up with anything. I wake up with a feeling of exhaustion. I do not read the news. Even though it is only February, it feels like this year has been 5 years already. Disruption and chaos seem to be part of our daily routine. While all this is happening, markets continue to be overall, pretty sanguine. Until they are not. We experienced some of that not so sanguinity on Monday...
Here we are 2 weeks into the new administration and the pace of change for what we normally expect of government is being turned upside down. Every day brings changes and uncertainty in terms of the outcome on the economy. So far markets are still sanguine. Averages have made new highs or are near new highs. With equity markets making new highs, at the same time, the bond market is having a more significant reaction...
Happy New Year! We took a couple weeks break from a very busy year to get ready for this year that will be very busy as well. It is important to recharge, renew, and be intentional about the other parts of our lives other than work because if we don’t take care of ourselves, who is going to take care of us? As far as markets are concerned 2024 was another 20% return for equity...
The week of world chaos. Head spinning events including the lack of confidence vote and resignation of the prime minister of France, the fall of the Assad regime in Syria, martial law declared in South Korea for six hours, rumblings in Eastern Europe in Georgia and Romania of Russian influence in elections and that is just in one week. What is going on and how does this affect the United States. For a very good...
The volatility of markets since the election is head spinning. After the massive gains on the day after election day 2 weeks ago, markets caught their breath and decided that the risks of uncertainty appeared greater than the opportunities. The Fed seems to be hedging its bets on continuing interest rate reductions saying that any further reductions are data dependent. Mixed into this reaction are President elect Trump's threats to fire the Federal Reserve chairman...
What a week. It was election week with a decisive electoral college and popular vote victory for Donald Trump. The country remains deeply divided despite this victory. Many of the campaign promises made by Trump have serious implications for the US economy as well and household economics. The Senate has also turned Republican but as of now the House is still undecided. If Republicans have the House, the Senate and the Presidency, it will make...
The jobs report on Friday was a bit of a shocker! Much lower number of new jobs than expected with previous months estimates reduced as well. Is the Bureau of Labor Statistics making numbers up. No!!!! Reports are always adjusted, and a more accurate indicator is looking at trends over 6 months. We recently had a GDP growth quarterly report of just under 3% and economic growth persists. Additionally, wages are increasing greater than inflation...
Goldman Sachs issued a report today in regard to the performance of the US stock market over the next 10 years. \ Their expectation is 3%! CNBC Daily Open: Concerns over high interest rates return, pressuring stocks . If you read the report, they are concerned about the historically high valuation of the current market averages. A common measure is a benchmark called the CAPE index that stands for the cyclically adjusted price earnings measurement...
October begins with uncertainty in the air. We have the election in 30 days and middle east conflicts are escalating as we speak. Again, investing based on politics and current events is even more hazardous and unreliable than investing on a regular basis. In addition, with the employment report issued on Friday, analysts and economists are more convinced that a soft landing is ahead. Markets expect two additional rate decreases before the end of the...
After all the anticipation and market discounting of the consensus view of the Fed lowering interest rates, it finally happened. Somewhat of a surprise, the first move down was a big one-50 basis points or ½%. The Fed also said they expect a couple of more moves down in the Fed funds rate before the end of the year. The total reduction for the year 1%. This is the Feds attempt for a “soft landing”...
Talk about good news and bad news and bad news and good news. We have it all and markets are reacting on a daily basis. Sell off and recovery, recovery and sell off. This week is a big one. 100% expectation that the Fed will reduce interest rates. The question is ¼ point or ½ point. Often the Fed is behind the curve with interest rates. The bond market has already priced in a reduction...
The anticipation of lower interest rates has been driving markets for the entire year. Looks like we are finally there but the fat lady has not sung yet. A September cut by the Fed has been likely confirmed by chairman Powell at the annual Jackson Hole conference as expected. Even with markets typically discounting news about 6 months in advance, this news drove a substantial rally all week peaking on Friday. This anticipated rate reduction...
