The Long Term Investor

I believe this survey is one of the most irrelevant pieces of data in the entire business world. BUT....here it is.

U.S. consumer sentiment falls in early March as inflation worries mount

https://finance.yahoo.com/news/u-consumer-sentiment-falls-early-152359480.html

(BOLD is my opinion OR what I consider important content)

"WASHINGTON (Reuters) - U.S. consumer sentiment fell more than expected in early March as gasoline prices surged to a record high in the aftermath of Russia's war against Ukraine, a survey showed on Friday.

The University of Michigan said its preliminary consumer sentiment index dropped to 59.7 in the first half of this month from a final reading of 62.8 in February.

Economists polled by Reuters had forecast the index falling to 61.4. Following Russia's invasion of Ukraine on Feb. 24, crude oil prices jumped more than 30%, with global benchmark Brent hitting a 2008 high at $139 a barrel, before retreating to trade around $110 a barrel on Friday.

U.S. gasoline prices are averaging a record $4.331 per gallon compared with $3.48 a month ago, AAA data showed.

Further increases are likely after President Joe Biden on Tuesday banned imports of Russian oil into the United States, as part of a wide ranging tough sanctions against Moscow.

The University of Michigan survey's gauge of current economic conditions slipped to a reading of 67.8 from 68.2 in February. Its measure of consumer expectations declined to 54.4 from 59.4 in February.

The survey's one-year inflation expectations jumped to 5.4%, the highest since 1981, from 4.9% in February. Its five-year inflation was steady at 3.0%.

The government reported on Thursday that consumer prices recorded their largest annual increase in 40 years in February."

MY COMMENT

Pretty irrelevant stuff......but it is in the headlines today. A totally hindsight survey that is not a surprise to anyone that has even the most basic understanding of what is happening in the USA and in the world right now. I dout that this little survey and all the other mentioned in this article....have any predictive value for investors.

 

Interesting.

Investors pour into Cathie Wood’s ARKK despite losses

https://finance.yahoo.com/news/inve...ds-arkk-despite-funds-downturn-194542894.html

(BOLD is my opinion OR what I consider important content)

"Even as Ark Invest’s flagship ETF trades at a mere fraction of its highest share price, famed portfolio manager Cathie Wood has never backed down on optimism around her strategy — and it appears Wood isn’t the only believer.

The Ark Innovation Fund (ARKK) has notched four straight weeks of inflows totaling $850 million, despite the fund being down more than 35% year-to-date, according to Bloomberg data.

Wood, whose trenchant stock selections made her a star on Wall Street after ARKK returned 150% in 2020, saw a change of fate last year when the fund nearly halved as speculative tech names — the kind of picks that comprise Ark's investment lineup — came under pressure over concerns the Federal Reserve would raise interest rates.

Bloomberg Intelligence senior ETF analyst Eric Balchunas, who pointed out recent investments make the fund the 22nd largest receiver of inflows in the past month, told ETFtrends.com the rush of investors is partially attributed to dip-buyers purchasing the vehicle at a discount, and partially because of Wood’s unrelenting conviction.

“You can depend on Cathie Wood’s stock picks,” he said. “Even people who don’t admire her stock picks are finding it appealing to buy her basket of ARK stocks at this price,” adding that the money manager was smart to stick to her guns.
Despite mounting pressure on Ark Investment Management, Wood has stayed the course and promised investors lofty returns, even making a move to expand her bets in disruptive innovation to private markets in filing with the SEC last month to launch a new investment vehicle.

“Given our expectations for growth in these new technologies, I think we’re going to see some spectacular returns,” Wood said on Monday in an interview with CNBC.

ARKK was up more than 5% in intraday trading on March 9 as of 1:38 p.m. ET.

The fund has seen some relief since being pummeled at the start of the year but remains more than 60% down from its February 2021 high.

In a recent note, Datatek Research likened ARKK’s trajectory to the 1990s dot com bubble, pointing out the fund’s direction has broadly tracked the Nasdaq’s 2000, early 2001 path.

“Speculative tech names have been under intense pressure for an entire year and that’s likely to continue over the coming weeks,” the firm said in a note last month. “ARKK’s latest one-year performance from its peak has generally followed the same downward path as the Nasdaq in the early 2000s, the best analog to overvalued tech stocks deflating.”"

MY COMMENT

This fund and the inflow is probably a good indicator of investor confidence. BUT.....that does not mean that I am recommending this particular fund. As noted is it down by 60% from it's 2021 high. My issue with the fund is the erratic and short term oriented nature of their buying and selling.......at least that is how I see what they do.

BUT....this is fun to watch and will be very interesting to see how they do over the next few years. I do LIKE the fact that investors are buying NOT selling in this time of market weakness.

 

WOW.....the number of homes for sale has SKYROCKETED in my little area of 4200 homes. We now have 10......YES TEN.....active listings for sale.

The BAD NEWS........they are all a million or above with the lowest being $1MILLION and the highest being $3MILLION. SO.....not much that is affordable for most people that want to come into this family oriented neighborhood with our great schools.

There are many homes in my area that should be in the $650,000 to $900,000 range but unfortunately few of them are coming on the market. Seems like owners are either afraid to sell since they would have a hard time finding another house and/or they are waiting for more gains to the value of their house.

I can see the day coming soon.......in about 3-5 years......where there is no house in this area below $1MILLION. I like it from a money and home ownership standpoint....but....dont like it from a neighborhood standpoint. It will change the character of the area. But what can you do.....time moves on.

 

Yeah....it is showing WEAKNESS going to the close. Not surprising.....no one that is any sort of trader, investment bank, hedge fund or speculator......wants to hold through a weekend. Too much potential for nasty news items especially in Ukraine.

 

I find this very typical......these days.

First-time buyers skip starter houses and go straight for bigger homes

https://finance.yahoo.com/news/first-time-buyers-skip-starter-houses-190450740.html

(BOLD is my opinion OR what I consider important content)

"Shaun Martin and his wife, Jennifer, have been house-hunting in the Denver market for nearly a year now, but they don’t want to buy just any house for the coveted title of homeowners. They want their dream house and they’re bypassing the fixer-upper home in their quest to find exactly what they want.

“We want a house that’s in move-in ready condition," said the 43-year old investor who flips homes for a living. "Good pipes, good electrical, good bones, all brand new."

Problem is, the Martins have unexpected company — and lots of it.

“More millennials are skipping starter homes and going for turnkey properties,” said Olivia Mariani, vice president of marketing for Curbio, a home improvement company for the real estate industry.

Millennials, which are the fastest-growing segment of homebuyers accounting for 37% of the overall housing market, don’t want to take on renovation projects or deal with contractors, Mariani said.

“If they see unusable kitchens or bathrooms, they’re going to take a pass," she said.

Just ask Katie Schenk. She and her fiancé, Jonathan, recently bought a newly-constructed townhouse in Howard County, Md. “We didn’t want to buy something we’d have to dump money into to fix up or repair,” said the 25-year old brand marketing manager.

At 2,500 square feet, their three-bedroom, two-and-half bath townhouse is also nearly twice the size of a traditional starter home.

“We both work from home and there’s no end to that in sight so we needed the space. He gets the whole main floor and I get the whole upstairs,” Schenk said. “There’s also outdoor space for our dog who likes to run around and play when he gets hyper.”

Schenk wanted a home that would both suit their current lifestyle and meet their future needs as they plan to stay put for at least 10 years. That’s well beyond the typical three to seven years that previous generations stayed in starter homes before taking profits from the sale and investing in something more substantial and permanent.

Dee Olateru is also thinking long term.

She recently put a deposit down on a brand new three-bedroom, two-and-a-half bath townhouse — which even boasts a two-and-a half-car garage — in Minneapolis, Minn. She plans to move into this model home this summer, once the construction is complete.

“It suits my immediate needs and is a place I can grow into if I have a family,” said the 36-year old single consultant. “It’s a much nicer place than I would have expected for my first home."

At nearly $500,000, it’s also nearly twice the price Olateru envisioned paying for a first home, but with a solid job and steady income in an incredibly strong labor market, she isn’t concerned about stretching her budget.

“I’m not going to be house poor," she said.

Rick Sharga, executive vice president of RealtyTrac, a real estate information company, said millennials are in a unique position.

“Young adults are able to leapfrog normal homebuying patterns even with prices going up due to a combination of low interest rates, low down payments, and hoards of cash," he said. "Keep in mind that during the pandemic, over 50% of young adults were living at home with their parents, not paying rent, and not making student loan payments, so they were able to save money for down payments on more expensive properties.”

Does this mean that the starter home is officially a thing of the past? Not necessarily, said Sharga.

“I think that once inventory comes back to market, we’ll see the return to more traditional home buying patterns," he said. “But I’ve never seen this kind of activity in the 25 years I’ve been in the industry.""

MY COMMENT

Probably not a bad thing if they actually do plan to live there for 10 years or more. OR......if the have no ability to visualize and design upgrades. If I was in this group my first factor in home buying would be.....location, location, location. But.......I have the ability to design and visualize upgrades to bathrooms and kitchens. A lot of young people just have not gained those skills yet in their lives.

Speaking of projects....all of ours are now done. Every one turned out great. It seems that lately.....unintentionally.....we have been putting money into our house and not the markets. We have now put about $60,000 into improvements in our house.....mostly in the......laundry room, kitchen, and a couple of bathrooms. At this point that is probably a better use for those funds than the markets. We are doing......EXTREMELY...... high end improvements that will greatly increase the value of our house........and......since they are quality all the way.....should stand the test of time.

 

A more typical day today than yesterday......all holdings in the red. At least it was only a moderate/medium loss. As usual on these types of days....I got beat by the SP500 by 0.50%. I continue to stay in about the middle of the little trading range I am currently stuck in.

TGIF......nice to have yet another week in the can. We can move on from here. Some day we are going to hit a positive week and than a positive month. I dont think any of the Indexes have been positive this year.

 

I see that NONE of the averages are in BEAR MARKET mode as we end the week. Look at those losses for the week....a brutal week.......especially for the guts of the market that reside in the NASDAQ and SP500.

Dow year to date (-9.34%)
DOW for the week (-1.99%)

SP500 year to date (-11.79%)
SP500 for the week (-2.88%)

NASDAQ 100 year to date (-18.49%)
NASDAQ 100 for the week (-3.87%)

NASDAQ year to date (-1.90%)
NASDAQ for the week (-3.53%)

RUSSELL year to date (-11.83%)
RUSSELL for the week (-1.06%)

We are quickly heading toward the end of the 1st Quarter.....which will no doubt end up firmly to the negative.

 

At least tomorrow might take away some of the market pain from this week. We will be bidding on two paintings in different auctions tomorrow. Neither is a high end item...but both will be good buys....well below market value.....if we get them for what we are going to bid. Both of the auctions are small regional auctions.....but that does not matter now with the internet. It is very difficult to find "sleepers" anymore.

As an added bonus......I get to play a show tomorrow night. Luckily it is inside since the temperatures are going to be freezing. I will get in about 3AM.

 

I have noticed that in the past with your SP500 numbers.

I get all my weekly and year to date figures from the CNN MONEY site. Here is a link for the SP500.....for example.

https://money.cnn.com/data/markets/sandp

 

This site seems to agree with my number for the SP500 YTD

https://www.slickcharts.com/sp500/returns/ytd

so does this one

https://www.marketwatch.com/investing/index/spx

so does this one

https://www.cnbc.com/quotes/.SPX