I dont see anything coming out of Jackson Hole....especially after the events of yesterday. I DO think we are on track for tapering toward the end of this year or early next year. I EXPECT that the impact will be......NOTHING....other than a week or two of erratic market reaction before the markets settle right back in as though NOTHING happened. Powell: Reversing Fed stimulus too early could be 'particularly harmful' https://finance.yahoo.com/news/powe...-could-be-particularly-harmful-140005760.html (BOLD is my opinion OR what I consider important content) "Federal Reserve Chairman Jerome Powell said Friday that the U.S. economic recovery appears to be making progress, but warned that the central bank needs to be careful not to tighten its policy before enough Americans can return to work. “Today, with substantial slack remaining in the labor market and the pandemic continuing, such a mistake could be particularly harmful,” said Powell in remarks delivered at the central bank’s Jackson Hole Economic Symposium. Powell’s warning hints at a more cautious approach to pulling back on its policy, as some members of the policy-setting Federal Open Market Committee start to call for slowing its asset purchase program — now. Still, the Fed chairman emphasized that the spread of the Delta variant presents a “near-term risk” to economic growth, but said he remained optimistic about the economic recovery. Powell specifically called attention to the labor market, where 6 million people remain out of work compared to pre-pandemic levels. Hiring firms have been scrambling to find workers, with a record 10.1 million job openings recorded in June. He added that the vaccination campaign, schools reopening, and the expiry of extra unemployment insurance will eventually restore a chunk of those unemployed. “These favorable conditions for job seekers should help the economy cover the considerable remaining ground to reach maximum employment,” Powell said, pointing to wage gains among some corners of the labor market. But the Fed chairman acknowledged rising inflation, which he described as a “cause for concern.” Data from the Bureau of Economic Analysis showed prices (measured in the Personal Consumption Expenditures Index) rising by 4.2% on a year-over-year basis, a pace not seen in over 30 years. Powell said he continues to expect high inflation to be “transitory,” expecting factors like unusually high used car prices to come down soon. “Policy can and should look through temporary swings in inflation,” Powell said at the conference, which was moved to a virtual format this year due to high COVID-19 case levels in Jackson Hole, Wyoming. Time to taper? Powell’s commentary comes as the FOMC debates whether or not to begin slowing the pace of its asset purchases. Since the depths of the pandemic, the Fed has been buying about $120 billion a month in U.S. Treasuries and agency mortgage-backed securities to stimulate demand in the economy. The test for the Fed to start tapering that so-called quantitative easing program has been “substantial further progress” on its dual mandate goals of maximum employment and price stability. Powell said high inflation readings hit that mark on its price stability mandate. But on employment, Powell said there has been “clear progress,” but suggested he may want to see more data before declaring the labor market ready to handle a Fed taper. “If the economy evolved broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year,” Powell said, adding that the Delta variant remains a risk. The Fed will receive another employment report, covering the month of August, next Friday. That will be the last employment print before the central bank’s next policy-setting announcement scheduled for Sept. 22. On interest rate hikes, the Fed chairman emphasized that the timing of any interest rate hikes are not to be linked to the timing of taper, noting that the Fed still has “much ground to cover” before wanting to raise rates from near-zero. “We have articulated a different and substantially more stringent test [for liftoff],” Powell said Friday. Powell said the economy has shown “more progress” since the Fed’s last policy-setting meeting in July, where the Fed held interest rates at near-zero." MY COMMENT YES....very BLAND comments by Powell. NOTHING is going to happen....which is as it should be. We are facing the end to unemployment benefits in about a month. that is going to be a MAJOR event for the employment situation. It is going to take many months for it to all sort out......and....there will be a good time period...at least till the end of the year....to see how the employment situation works out. Looks to me like we are going to see a time period of about 6-12 months for interest rates to start being raised. Good.....psychological.......news for the markets going forward over the short term. As to inflation....it is kind of refreshing to see it around 4%. In the old days that used to be part of the.......NORMAL RANGE. I think it is STILL part of the normal range....regardless.....of how people want to view it.
A GOOD open today....and after the Powell comments......the averages are kicking up their heals. HERE is the economic news that no one will care about. US consumer spending slows to 0.3% gain in July https://abcnews.go.com/US/wireStory/us-consumer-spending-slows-03-gain-july-79677659 (BOLD is my opinion OR what I consider important content) "WASHINGTON -- Growth in U.S. consumer spending slowed in July to a modest increase of 0.3% while inflation over the past 12 months hit its fastest pace in three decades. Last month's spending fell sharply from a 1.1% rise in June, the Commerce Department reported Friday. It was the clearest signal yet that the surge in the delta variant of the coronavirus was is an impact on consumer spending, the driving force in the economy. Consumer prices over the past 12 months have risen 4.2%, the biggest 12-month gain since a 4.5% increase for the 12 months ending in January 1991. The price index tied to consumer spending is the price gauge preferred by the Federal Reserve. The 4.2% increase over the past year is well above the Fed's annual inflation target of 2% but so far Fed officials view the jump in inflation as transitory and have not changed their easy-money policies in the belief that rising infections could become a threat to future growth. Incomes, which provide the fuel for future spending, rose a solid 1.1% in July reflecting in part the strong job gains seen that month. The government reported Thursday that the overall economy as measured by the gross domestic product, rose by a solid 6.6% in the April-June quarter. While economists have trimmed their forecasts for growth in the current quarter based on the virus resurgence, analysts still believe if COVID-19 cases recede in the final four months of 2021, this year the country will experience its strongest growth since the mid-1980s. “We believe cooler consumer spending growth is more likely than consumers retrenching and the economy going into reverse,” said Lydia Boussour, lead U.S. economist at Oxford Economics. The pandemic crushed spending on services like travel and restaurants, though Americans continued to spend money on goods as they held up at home. There is some evidence that the spread of the delta variant may again be cooling spending on services, which had begun to rebound as more people became vaccinated. Southwest Airlines is reducing flights for the rest of the year because infections starting to cut into the demand for plane tickets. The airline said Thursday it would cut its September schedule by 27 flights a day and trim 162 flights a day, or 4.5% of its schedule, from early October through Nov. 4. The 4.2% rise in overall U.S. inflation over the past 12 months was up from a 4% gain for the 12 months ending in June. Core inflation, which excludes energy and food, was up 3.6% for the 12 months ending in June, also the fastest increase since 1991. The 1.1% rise in incomes was the best showing since a 21% surge in March when the government was disbursing economic support payments from the $1.9 trillion rescue plan that President Joe Biden pushed through Congress. The increase in July reflected strong hiring and the initial payments from the expanded Child Care Tax Credit. With incomes outpacing spending, the personal saving rate rose sharply to 9.6% of after-tax incomes in July. Economists estimate that the excess savings of households now totals around $2.5 trillion, giving consumers plenty of spare cash to keep spending. For July, the spending gain reflected a 1% rise in spending on services which includes everything from restaurant meals to utility bills. Spending on durable goods such as autos fell a sharp 2.3% while spending on nondurable goods such as clothing was down 0.4%." MY COMMENT A good report for investors. The economy is not too hot and not too cold. As usual....I will say that this ERRATIC economic data.....is EXACTLY what you would expect for trying to re-open the worlds largest economy.
No one talks about the treasury yields anymore. MOVE ON....nothing to see here. We continue to see the ten year yield generally siting near.......100 YEAR LOWS. Yet another continuing positive indicator for investors. Treasury yields head lower as Fed’s Powell reveals support for tapering https://www.marketwatch.com/story/l...jackson-hole-speech-11630063568?siteid=yhoof2 (BOLD is my opinion OR what I consider important content) "Yields for U.S. government debt slipped on Friday, as Federal Reserve Chairman Jerome Powell revealed that he supports a 2021 start to taper bond purchases although he was careful not to discuss when the Fed might formally announce such a move. Meanwhile, bond investors appeared for now to look past the U.S. PCE inflation rate, which hit a 30-year high in July as the country confronted major shortages. What yields are doing The 10-year Treasury note TMUBMUSD10Y, 1.332% yields around 1.331%, versus 1.342% on Thursday at 3 p.m. Eastern Time. The 30-year Treasury bond rate TMUBMUSD30Y, 1.939% was at 1.921%, compared with 1.940% a day ago. The 2-year Treasury note TMUBMUSD10Y, 1.332% was yielding 0.231%, versus 0.237% on Thursday. What’s driving the market? In a closely watched Jackson Hole speech, Powell revealed on Friday that he was one of the majority of Fed officials who believe the central bank can “taper” or slow the pace of its bond purchases this year. The Fed chairman said “at the FOMC’s recent July meeting, I was of the view, as were most participants, that if the economy evolved broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year.” Meanwhile, he was careful not to discuss when the Fed might formally announce the taper. On Friday, at least two more Fed officials joined the chorus of voices in favor of tapering soon. In an interview with CNBC, Philadelphia Fed President Patrick Harker said he didn’t think the $120 billion per month of asset purchases were “doing a whole lot right now.” Cleveland Federal Reserve Bank President Loretta Mester, also speaking to the network, said she would be comfortable with the central bank laying out its taper plans in September, and winding down purchases by mid-2022. A third policy maker, Atlanta Fed President Raphael Bostic, told CNBC that the U.S. economy is “very close” to the substantial progress benchmark needed to start tapering its asset purchases, but “a lot depends on what happens in the next couple of months.” Minutes of the Fed’s July 27-28 meeting showed that most of the 19 top Fed officials said that they thought it would be appropriate to start reducing monthly asset purchases this year. The Fed next meets Sept. 21-22. The Jackson Hole event, which normally is a gathering of monetary policy makers near the Grand Teton mountain range in Jackson Hole, Wyo., has become a place where significant policy shifts are relayed to the public, with last year’s focus on the Fed’s strategy move to allow its annual inflation target of 2% to overshoot as it combats any weakness in the labor market. Until the past few days, U.S. government bond yields had been steadily drifting higher in recent weeks, with the 10-year at around its highest since Aug. 12, but remaining at historically low levels, while investors face the prospect of the eventual end of an accommodative stance by the Fed. Data released on Friday showed that the PCE inflation rate hit a 30-year high in July, as the U.S. confronted major shortages. The so-called PCE price index climbed 0.4% in July, government figures show. It was the fifth big increase in a row. Meanwhile, the rate of inflation in the 12 months ended in July edged up to 4.2% from 4%, biggest increase since the first Gulf War in 1991. Meanwhile, consumer spending slowed last month — rising by a modest 0.3% that matched the estimate of economists polled by The Wall Street Journal. Americans spent money at a slower pace as delta nipped at the economy, but households are still flush with savings. And personal income jumped 1.1% in July, more than the 0.3% rise that was expected. What analysts are saying “We now expect a formal announcement of tapering to come in November, with tapering to start in December (slightly earlier than we previously anticipated),” analysts at UniCredit wrote in a Friday note, ahead of Powell’s remarks." MY COMMENT I can NOT even begin to imagine locking up ten year money........and..... ESPECIALLY 30 year money at the current rates. Perhaps if you were in the EU or other places in the world that are.....STILL....seeing DEFLATIONARY rates that are negative. Stocks and funds are the ONLY game in town here in the old USA.
Same for me Zukodany....I just looked. Looks like you are seeing some nice gains lately. That is just the REALITY of this market.....and....the normal market. Individual portfolios come and go through the year....some people are up and others are down. BUT....over the longer term most people do just fine. We ALL have times during any year when we LAG. You already know that as a business person and collector. The main thing is to have a plan and stick with your plan....have confidence in what you own for the reasons that you bought it to begin with. I am personally seeing new all time highs nearly every day or two lately. It is nice.......but will it stick...that is the question. I see it as building up a CUSHION for the next little correction or time of weakness. It is a race to the end of the year. Once we hit year end the result is....IN THE BOOKS.....part of the historical record......and....I move on to the new year starting at "0". Basically at this time....with four months to go in the year......the averages are WAY ABOVE their historical gains. The SP500 is at basically +20% year to date over ONLY 8 months. We are all set up for a great year this year. I can see the SP500 ending the year at about +25% on the high side......on the low side....about +12%. Either number represents a very nice year if we can end up in that range. A DEFINITE PROBABILITY.
My little....LOCAL....real estate market is in back to school mode. The kids started school a few weeks ago and the market has slowed now that we are heading toward the Fall season. BUT...."slowed" is a relative term.....it is STILL a very hot sellers market. The difference is that the CRAZY INSANITY has now slowed some. There are a good number....about 10 homes on the market in the $600,000 to $850,000 range.....that is the low end of the market. So...buyers have a choice of homes compared to a few months ago. We currently have 23 homes ACTIVELY for sale out of 4200 homes. The LOWEST priced home is $610,000.....the highest is just under $2,000,000. Prices are....NOT....dropping from the peak. Of the 23 homes for sale.....4....are in the ONLY area of the neighborhood that is still under construction...about 85 homes. They are EXTREMELY overpriced for the lot size and quality of construction. BUT....If you want new construction in this area.....this is what you get.
ANOTHER....really nice day today.....and.....as usual another all time personal account high. I was GREEN today of course.....and...got a beat on the SP500 by 0.10%. I am happy to take what the market gave me today.
I KNEW that we were having a good week....in the markets, but.....I did not know it was this good. REALLY solid gains in the averages for the week. DOW year to date +15.84% DOW for the week +0.96% SP500 year to date +20.06% SP500 for the week +1.52% NASDAQ 100 year to date +19.74% NASDAQ 100 for the week +2.26% NASDAQ year to date +17.39% NASDAQ for the week +2.82% RUSSELL year to date +15.31% RUSSELL for the week +5.05% The averages ALL continue to be bunched together year to date. this year has been a very BROAD BASED RALLY. Good for everyone. Lets continue this trend next week.
THIS is a BIG reason for the great recent returns. U.S. corporate profits soar in second quarter; economic growth raised https://www.reuters.com/business/us...htly-higher-weekly-jobless-claims-2021-08-26/ (BOLD is my opinion OR what I consider important content) "WASHINGTON, Aug 26 (Reuters) - U.S. corporate profits surged to a fresh record high in the second quarter, boosted by robust demand and higher prices, suggesting that an anticipated slowdown in economic growth this quarter because of soaring COVID-19 cases could be temporary." MY COMMENT We are seeing historic growth and profits this earnings season. HERE is a very good prediction for the rest of the year. Lets hope this comes to pass.....it will mean a potential for a +30% year in the SP500. U.S. corporate earnings season expected to lift S&P 500 by another 8% through end of year: Wells Fargo https://www.theglobeandmail.com/inv...-season-expected-to-lift-sp-500-by-another-8/ (BOLD is my opinion OR what I consider important content) "A stellar U.S. corporate earnings season is expected to lift the S&P 500 by another 8 per cent through the end of the year, analysts at Wells Fargo said on Tuesday, implying a near 28-per-cent jump for the benchmark equities index in 2021. In raising his price target for the index to 4,825 points, Wells Fargo analyst Christopher Harvey said S&P 500 firms had so far seen their earnings-per-share forecasts raised by 21 per cent “and the trend shows no sign of abating.” With the second-quarter U.S. reporting season nearly completed, Refinitiv data shows that about 87 per cent of S&P 500 companies have beaten analysts’ profit expectations, the highest on record. The stunning rebound in corporate profits and a loose monetary policy by the Federal Reserve have helped Wall Street’s main indexes hit new highs following the coronavirus-driven crash last year. The S&P 500 has more than doubled since its pandemic lows in March, 2020, although gains have recently been capped by fears the Fed could begin to taper its massive stimulus program sooner than expected. The index is up about 19 per cent so far this year. “If and when the Fed does finally utter the T-word [taper], we would expect the market to take a step back,” Mr. Harvey said in the note to clients. All eyes are on the Fed’s annual Jackson Hole symposium this week. UBS analysts also raised their S&P 500 targets for end-2021 to 4,600 from 4,500 and introduced an end-2022 target of 5,000 in a note published on Sunday. Over the past 31 years, there have been nine instances where the S&P 500 rallied 10 per cent in the first eight months of the year followed by an average 8.4-per-cent climb over the final four months, Wells Fargo analysts said. August and September have been the two weakest months of the year for equities over the past decade, they said." MY COMMENT We are NOT seeing any weakness in August this year.....and....I seriously doubt that September will be any different. I think we are in for a very nice continuation of the market march to new highs through the month of September. I dont see any mews of any sort that is going to change the re-opening market BOOM. It will be nice to STOP the unemployment DRAG in September. From that point on we will be FREE of all the pandemic economic BS.....eviction moratorium, pay for not working, etc, etc, etc.....and the economy can adjust back to normal month by month. It will be time for people to get back to work and grow up.
I have been rushing around all day like a MANIAC. I am rushing now to leave for a show. I have the car packed and will be going out the door in 30 minutes. You guys put up some interesting stuff for me to read when I get back tonight about 1:00AM.
I have no axe to grind but neither do I have any interesting content. Mostly, I am looking at my portfolio in disbelief and trying not to giggle.
BOOM , and there off !!! up about .36% at the open by the time POWELL was done speaking UP 1.01% 1:00 PM eastern UP 1.25% 3:00 PM UP 1.33% 3:30 PM UP 1.40% Close UP 1.33% UP 2.8% for the week WooHoo !! Daddy's shopping for a new pair of shoes !! or in my case Boots & Sperrys Just my .02 worth, Or "Unsolicited Advice" If you haven't refied all your various mortgages (and maybe take some cash out as well !) , might be last call on the insane rates we've enjoyed the last year. Suze Orman might not approve (of cash-out refi's), but it worked for me in getting down payment cash for additional properties. Psst, Psst Hey Guys the boss is gone !!!! Why do I have that same feeling as when the teacher would leave the 7th grade classroom ? Hey Tom , I hear you !
Up to new highs yesterday, 14.95% gain on my stock account which isn't bad for my 1st year. IRA also at new high so it was a good week overall. Part of my investment strategy (ira) I mostly leave alone , thinking as a true long termer. My stock account I'm more medium term and right now I have only 2 positions, MU and VOO. G
Yup this past week felt “Februarish”… literally my entire portfolio was green solid. Not even one bad seed in the whole batch of 22. Of course I ditched some of those earlier this month, but I was looking at those stocks out of curiosity and they were up as well. Overall the market feels very positive right now and I think that IF this will be going on for a good week or 2 more that I may pull out some cash from BIG winners. But let me not count my chicken just yet! Anyone else here checks their portfolio/analyze charts on a tablet? I just got a new iPad a couple of months ago and I use yahoo finances and Simply Wall st now as my preferred apps. I’m kicking myself in the head for not doing this any sooner… especially with chart and financial analyzing, simplywall st displays on the tablet are INSANE. I get to run through hundreds of companies in a matter of minutes and the flaws stick out immediately graphically. would be interesting to hear from others as to what their weapon of choice is and why Enjoy your weekend guys
Hey OldmanR we got a pair of Lucchese boots this year and we became instant fans. Love the brand and the history behind the company
It should be ANOTHER great week.......next week. I dont see anything going on that is likely to be any sort of market mover coming up. The FED has basically given us the.....short term....green light. Interest rates are STABLE. Earnings are mostly in the bag and came in at HISTORIC levels. Seems to me like a good week to add another 1-2% to the general averages. We ARE.....in the month of August......one of the "bad months". We are about to enter September......another "bad month". And We are STILL in the......"sell in May"....time period. Unfortunately for those that like to follow and invest according to SUPERSTITION......it has been GREAT TIME to be invested in these time periods this year. September should continue the UP TREND. I continue to be fully invested for the long term as usual.
Speaking about September. Opinion: Why you should think twice before betting that stocks will have a rough September https://www.marketwatch.com/story/w...e-a-rough-september-11630011533?siteid=yhoof2 (BOLD is my opinion OR what I consider important content) "Even though September is by far the worst month of the calendar for the U.S. stock market, you shouldn’t bet that this seasonal pattern will continue. That’s because I know of no plausible explanation for why September should be bad for equities. Without the existence of such an explanation, there is a high probability that the pattern is merely a fluke of the data. Of course, just because I don’t know of such an explanation doesn’t mean none exists. But I have my doubts. Despite asking for many Augusts now for your most plausible theories, I have yet to see any that withstand statistical scrutiny. In this column I want to focus on the two explanations that have been most often suggested for the “September effect.” The first is a supposed “seasonal behavioral bias” that, as Investopedia puts it, leads “investors to make portfolio changes to cash in at summer’s end.” The problem with this theory is that, if true, you’d expect that stock markets in the southern hemisphere would experience a pattern that is staggered by six months relative to what we see in the U.S. But I could find no such pattern. Consider South Africa, where summer lasts from December through March. When ranked according to average return, April is the second-best month of the calendar for the South African stock market (as judged by the FTSE South Africa Index since 1988, per FactSet). March is the third-best month. Or take Australia, where the summer season is considered to last from December through February. According to my analysis of Australian stock market data from the Organization for Economic Cooperation and Development, reflecting data back to 1960, February and March are no worse than the other months of the calendar, on average. To be sure, these other countries’ experiences don’t prove that there is no seasonal behavioral bias at the end of the summer. But to argue that one still exists, you have to argue that this bias exists only among U.S. investors. That is a different, and more difficult, argument to make. You should be skeptical. Mutual fund tax year The other widely proposed theory to explain the stock market’s poor September performance is that mutual funds’ tax year ends on Oct. 31. According to the theory, fund managers anticipate that deadline by starting to dump their losing positions in September. This theory is easily tested because beginning in 1986, all mutual funds were required to have the same tax year. Prior to then, mutual funds were free to choose any tax-year end. If the Oct. 31 tax year were the cause of the stock market’s poor September performance, we would expect this seasonal bias to have become more pronounced after 1986. But that is not the case. Prior to 1986, the Dow Jones Industrial Average’s DJIA, +0.69% return in non-September months on average was 1.8 percentage points better than in September. The comparable spread after 1986 is 1.7 percentage points. So the shift to a universal tax-year-end on Oct. 31 had no apparent effect on the magnitude of the September effect. Of course, the failure of these two hypotheses doesn’t mean a plausible explanation for the September effect won’t someday be found. But until then, my recommendation is not to bet that the pattern is real. Stock market lore is filled with correlations that are statistically significant but have no real-world significance. Needless to say, the stock market may still lose ground next month. My point is that, if it does, it won’t be because it’s September." MY COMMENT OBVIOUSLY.......I NEVER invest according to superstition. This sort of "stuff" has no basis in fact. Even if it did...there is NO reason for any long term investor to follow this sort of short term "stuff". Even if true...I would simply hold through the "bad month" and continue after with no change. The ABSOLUTE worst thing any long term...or for that matter any investor......can do is to jump in and out of the markets trying to time short term events....whether true or not.
Wanted to ask everyone here how have they been doing financially in regards to spending. I think it will be interesting to hear. I had to have a chat with my wife about tapering down with her spending. Particularly groceries. We have almost doubled our groceries spendings this past year as we have reached 1500/mo on groceries. And we live in Ohio! Last year at this time in NY we barely got to 800. And it’s not like groceries prices have increased THAT much. So I was wondering if anyone else here that’s engaged in monthly budgeting has found out a similar increase in spending with their spouse or even on their own
Hello fellow long term investors! I have been a long term reader but this is my first 'contribution'. Thank you everyone for you contributions and sharing of investing knowledge, good, bad and indifferent. As many others have found the buy and hold strategy has served me much better than the 'trading' method. I am in my mid 30's, so I'm one of the younger guys here and have a couple decades to take advantage of that magical compounding interest that we have all come to love. I have a little different investment setup than most people. The 401k is heavily contributed to and is S&P 500 based and my personal trading account is higher risk but has done very well for me. My intention is to start transitioning money into VGT and VOO to reduce volatility but for the time being I'm going to let the winners run. I know a 400% return since Jan 1, 2018 isn't normal but I still see alot of upside on tech and chips. Who knows, I can't time the market and I can't tell the future! Current Mix: AMD NVDA VGT CHWY I know Tom and WXYZ are looking at that and shaking their heads.... sorry!
