The Long Term Investor

MEANWHILE......I sit and do nothing....as usual.

The SP500 at this MOMENT is at (-15.15%)

What has been forgotten.....very quickly.....is the recent, LONG TERM, past where we saw the SP500 gaining as follows:

2022 (-15.15%)...so far
2021 +28.71%
2020 +18.40%
2019 +31.49%
2018 ( -4.38%)
2017 +21.83%
2016 +11.96%
2015 + 1.38%
2014 +13.69%
2013 +32.39%
2012 +16.00%
2011 + 2.11%
2010 +15.06%
2009 +26.46%

The past 14 years from 2009 till 2022.....have been an amazing run for long term investors. In addition the compounding that occurred over that time span is ENORMOUS. I am NOT going to get real excited about two down years......2018 and 2022. I care about the long term gains.

 

We have pulled back some from the earlier losses......but.....beware the final hour.

Stock market live updates: Stocks pare losses, Treasury yields jump as investors face hawkish Fed

https://finance.yahoo.com/news/stock-market-news-live-updates-august-29-2022-114034238.html

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

"U.S. stocks wavered Monday but were well off session lows as Wall Street attempted to recover from Friday's sell-off.

The S&P 500 was down by just 0.1% after falling nearly 1% earlier in the trading day, while the Dow Jones Industrial Average hovered near breakeven. The tech-heavy Nasdaq Composite fell 0.4%.

Meanwhile in the bond market, the benchmark 10-year Treasury note held above 3.1%, and the 2-year Treasury yield topped 3.4%, hitting its highest level since 2007 early Monday.

The moves come after hawkish remarks by Fed Chair Jerome Powell at the central bank’s gathering in Jackson Hole last week. The Nasdaq plunged 3.9% on Friday and the S&P 500 tanked 3.3%, with both indexes logging their biggest one-day drops since June 13 on the heels of Powell's speech. The Dow erased 1,000 points during the session, or roughly 3%.

“Chair Powell’s speech was a good reminder that 2-year Treasury yields are more important to equity markets than whether the FOMC moves by 50 or 75 basis points at upcoming meetings,” DataTrek’s Nicholas Colas said in a Monday note, pointing out that U.S. large-cap stocks have been sensitive to the 2-year benchmark.

The jump in 2-year yields from 2.28% to 3.45% in mid-June was what cracked equity valuations, with the S&P hitting its June 16th low after yields peaked on June 14th at 3.45%, Colas said. And once 2-year yields leveled out near3%, the S&P 500 rallied 17% through August 16th.

The most significant risk to stocks is weakness in earnings, according to Morgan Stanley’s Mike Wilson, who indicated that while the first half of the year was dictated by Federal Reserve policy and tighter financial conditions, the second half will be determined by earnings expectations for next year.

“As a result, equity investors should be laser focused on this risk, not the Fed, particularly as we enter the seasonally weakest time of the year for earnings revisions, and inflation further eats into margins and demand,” Wilson said.

Wells Fargo Head of Global Asset Allocation Strategy Tracie McMillion asserted a similar view in an interview with Yahoo Finance Live on Friday.

“What we heard today was that growth is too strong,” McMillion said. “What that means for earnings is that we're likely going to have to see some cuts to Q3 and Q4 earnings expectations.”

The earnings season is nearing an end, but results from several headliners remain on tap for investors this week, including Best Buy (BBY), HP (HPQ), Big Lots (BIG), Chewy (CHWY), Lululemon Athletica (LULU), and Broadcom (AVGO)."

MY COMMENT

EARNINGS? What are those? The factual stuff in this little article.....ok. The opinion stuff......not so much.

In other words......now they are going to start to push the 3rd and 4th quarter earnings as the great big stock market BOGEYMAN lurking under the bed. Brother....

 

Here is another little.....FED..... story for anyone that is not aware.

Fed’s QT to Hit ‘Full Stride’ With Central Bank Shrinking $9 Trillion Portfolio

https://finance.yahoo.com/news/fed-qt-hit-full-stride-172449002.html

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

"(Bloomberg) -- The Federal Reserve’s balance-sheet unwind is set to ramp up this week, which means the central bank will finally begin unloading the Treasury bills it started amassing almost three years ago.

As part of its broader plan to reduce its $9 trillion portfolio, the Fed will boost its monthly caps for the amount of Treasuries and holdings of mortgage-backed securities that it will let mature to $60 billion and $35 billion, respectively, while using its $326 billion stash of T-bills as filler when coupons run below the monthly level. September will be the first month that bills will be redeemed since coupons will fall below the monetary authority’s new cap.

The Fed’s portfolio has $43.6 billion of Treasury coupons maturing in September, which means that officials will need to let go of $16.4 billion of bills as well. It will also need to let another $13.6 billion run off in October. These will be the largest declines for the bill portfolio until September 2023.

There’s been keen interest in the Fed’s bill holdings due to the fact that the last time the monetary authority undertook so-called quantitative tightening it didn’t own any of the securities. It’s also critical for money-market traders who have been struggling to find assets in which to invest. They’ve largely opted to park excess cash at the reverse repurchase agreement facility, and a full rundown of the Fed’s Treasury bills would’ve provided investors with a jolt of supply.

“This is the first time the Fed is allowing bills to run off their balance sheet, three years after they started buying them quickly due to a reserve shortfall,” said TD Securities strategist Gennadiy Goldberg. “QT is hitting its full stride.”

A drop in reserves below the system’s comfortable level in September 2019 helped fuel a disruptive spike in repo rates, a keystone of short-term funding markets. As a result, the Fed began buying roughly $60 billion of Treasury bills a month to beef up its reserve balances -- in addition to conducting daily repo operations.

While the central bank expected to buy bills through the second quarter of 2020, the economic turmoil brought on by the pandemic spurred a wave of fiscal and monetary stimulus, flooding the financial system with cash and ensuring reserves were more than ample. The difference is Treasury has since dialed back the amount of bill supply creating an imbalance where short-term investors are left with very few investment options beyond the Fed’s RRP.

Bill supply is finally starting to edge higher, thought it’s still not enough to satiate the demand. The expectation among Wall Street strategists is that as the path of the Fed’s interest-rate hikes slows and Treasury continues boosting the amount of T-bills it issues, it will draw those reticent investors away from the haven of the RRP and back into the market.

Still, the week-to-week and month-to-month bill holdings will have no bearing on the market supply of bills as the Treasury factored the redemptions into its quarterly borrowing plans, according to Wrightson ICAP. There are longer-term concerns because as the Fed has less securities to lend to dealers in its daily operations, it will impede their ability to cover short positions and make it more expensive to borrow in the repo market.

“From a cash-market perspective, nothing will change when the first bill runoff takes place on Thursday,” Wrightson ICAP economist Lou Crandall wrote in a note to clients Monday."

MY COMMENT

Thats big of them. Probably most people thought they were already taking care of their balance sheet.

 

A little societal data as we wait for the close.

Americans are retiring later in life versus 30 years ago

https://finance.yahoo.com/news/amer...r-ages-will-the-trend-continue-193917714.html

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

"The phrase “keep on truckin’” seems apt when it comes to when folks are retiring.

The average retirement age has crept up by four years over the past three decades, from 57 in 1991 to the current 61, according to Gallup's annual economy and personal finance survey of 1,018 adults.

Meanwhile, the Gallup researchers predict that if active workers retire when they plan to, the average retirement age will increase evenfurtherin the coming decades.

“The increase in employment among older people is one of the most important changes to the labor market over the past quarter century,” Richard Johnson, director of the Program on Retirement Policy at the Urban Institute, told Yahoo Money. “Someone ages 62 to 69 in 2019, just before the pandemic began, was 47% more likely to participate in the labor force than someone in that age group 25 years earlier. That’s an enormous gain.”

And it’s a good thing. More time earning income and socking away funds for retirement has become imperative for many people due to a dearth of savings, longer life spans, and the soaring cost of out-of-pocket health care costs even after Medicare benefits kick in.

More older workers in the labor force

From 1991 to 2022, the biggest decline in retirement came from folks in the 55-59 and 60-64 age ranges. Only 11% of 55- to 59-year-olds are retired, down from 19% in 1991, while 32% of 60- to 64-year-olds are retired now, down from 41%, according to the Gallup survey.

Those over 65 are staying on the job longer as well. More than two-thirds, or 76%, of U.S. adults aged 65 to 69 are still working, up from 70% thirty years ago. Septuagenarians are on the job, too. While 83% Americans who are aged 70 to 74 have officially retired, that’s down from 88% in 1991.

For those aged 75 and older, labor force participation is projected to rise from 8.9% in 2020 to 11.7% of that cohort by 2030, according to the Bureau of Labor Statistics. That would be a 96.5% increase between 2020 and 2030.

The recent Gallup survey also found that the age that people target for retirement has jumped, too. People anticipate they will retire at 66 today, compared with 60 in 1995, the first year that it tracked that data.

“The fundamentals that kept older people at work persist,” Johnson said. “Participation rates have increased because work incentives have increased. Work at older ages is more financially rewarding and less arduous, in general, than it used to be, and retiring early is more costly.”

Why are there more older workers?

The uptick in retirement ages has been driven by several fundamental changes.

In 1983, a gradual increase in the age for collecting full Social Security retirement benefits began to be phased in and is now complete. The full retirement age increased from 65 to 67 over a 22-year period. The incentive to keep working and delay tapping Social Security until age 70 was also added. Between full retirement age and 70, you earn delayed retirement credits, which is roughly an 8% per year annual increase. The benefit increase stops when you reach age 70.

Many jobs are also less physically demanding than they once were, making it far easier to work longer with an aging body. The decline in employer-provided retiree health insurance has pushed workers to postpone retirement until they’re eligible for Medicare at age 65.

“Hardly anyone offers retiree health benefits any more,” Alicia Munnell, director of the Center for Retirement Research at Boston College, told Yahoo Money. “Less than 20 percent of large firms – 200 or more employees – offer retiree health insurance to current workers. Smaller firms traditionally have rarely provided this benefit.”

Companies also shifted from defined benefit plans to 401(k) plans that people can continue to contribute to as long as they keep working. It also puts the onus on the worker to fund much of their own retirement, which most workers are woefully behind on.

Only about half of workers with 401(k) plans said they feel confident they’ll reach their retirement savings goals, according to the Schwab survey. The amount they believe they need to have saved for retirement: an average of $1.7 million.

There’s also long-term unemployment that can hit older workers especially hard. For instance, the percentage of jobseekers ages 55 and older who were long-term unemployed in July was 24.2%, compared with 17.2% of jobseekers ages 16 to 54, according to the Bureau of Labor Statistics. Those are people who have been searching for a job for 27 weeks or longer.

Nearly two-thirds (63%) of job seekers 45 and older are out of work for more than a year, versus only 36% of job seekers 18 to 34, according to a report from Generation, a global employment nonprofit that surveyed 3,800 employed and unemployed people and 1,404 hiring managers.

“This is important because age bias can relegate talented, skilled workers to lower-paying jobs, or multiple jobs,” Ramona Schindelheim, WorkingNation editor-in-chief, told Yahoo Money. “These 20-plus extra years should be key money-earning years, preparing them for their final retirement years. Instead, many of these same workers might have to work even longer to make up the difference.”

Why Gallup’s crystal ball could be wrong

The question is will the retirement age keep climbing? Gallup’s report said “If active workers retire when they plan to, the average retirement age will increase even further in the coming decades.”

The reasoning:Those changes and incentives to Social Security payouts authorized in the 1980s are now in play for workers hitting retirement age today. Plus, “longer life spans for U.S. adults may also be a factor in later retirement ages, with workers perhaps seeing a need to save more money, anticipating a retirement that could last as long as 30 years, particularly with the cost of living increasing,” according to the researchers.

Still, that's only a forecast.

“There are several factors that have kept workers on the job longer, but that doesn’t mean that trend will continue,” Munnell said. “The conclusion from my analysis is that a lot of the forces that have led to this increase in working to a later retirement age have sort of worked their way out.”

Munnell’s data shows that in 2021, the average retirement age for men was closer to 65, roughly three years later than in the mid-1980s and early 1990s and for women, it was 62.

“Yes, we've had this increase in the average retirement age in the U.S. since 1991,” Munnell added. “I don't think we should expect another similar increase over the next 30 years. Let’s kill that notion.”"

MY COMMENT

The youngest BABY BOOMERS are about age 58. MOST baby boomers will retire by age 70.....so we will be out of the work force in about 12 years. We will all be siting and waiting for some kid to walk on the grass.

At that point.......it will not be our problem.....the country will be mostly in the hands of the.......SCREEN PEOPLE.

 

I knew the last hour felt like trouble today. My losses were medium by the close....but nearly doubled in the last hour. Investors.....traders....are scared to hold after the close. As I said....I had a moderate/medium loss today. Not as bad as it could have been since EVERY ONE of my stocks was red today. I got beat by the SP500 by 0.62%.

An expected red day after the blood bath on Friday. I still have a BIG cushion to chip away at.....with the big gains that I made in account value during the recent BULL RUN.

 

I am off to get the shingles shot and than head off to play a show tonight. My 41 year old kid just got shingles and the facial paralysis. Fortunately with all the media coverage of Justin Bieber having the same thing.....they got it diagnosed the first day and got aggressive treatment immediately before the paralysis got bad. They are fine and fully recovered now.....but it is motivating us to get the Shingles shots.

So....this is my last post of the day. Everyone else.....keep on posting.

 

The markets have to shake off the "stupid" right now. I am convinced it is traders....doint what they do. At this point all of the long term investors are just siting. Those that freaked out and sold did so long ago. So the only thing that can drive this sort of day to day action is the professional traders.

I dont really think any professional thought that the FED was going to back off in September. But if you push that narrative and than collapse the narrative.....you can get some really good, high probability, trading action.

My account at the moment is looking just like yesterday. We simply have to let the markets digest last week.....it will take a few days to do so.

 

Sticking somewhat to the same topic.

Weekly Market Pulse: The Dog That Didn’t Bark

https://alhambrapartners.com/2022/08/28/weekly-market-pulse-the-dog-that-didnt-bark/

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

"Gregory (Scotland Yard detective): “Is there any other point to which you would wish to draw my attention?”

Sherlock Holmes: “To the curious incident of the dog in the night-time.”

Gregory: “The dog did nothing in the night-time.”

Sherlock Holmes: “That was the curious incident.”

From Silver Blaze by Arthur Conan Doyle, 1892"

"It is hard to determine sometimes what causes markets to move as they do. Take last Friday’s stock market selloff. The widely cited “reason” for the selloff was Jerome Powell’s speech at the Fed’s Jackson Hole Symposium. Frankly, I don’t think Powell said anything new, his message remarkably similar to his last post-FOMC press conference. But two passages drew attention as being sufficiently different to upset the market. First was this bit, where the keyword was supposedly “pain”:

Restoring price stability will take some time and requires using our tools forcefully to bring demand and supply into better balance. Reducing inflation is likely to require a sustained period of below-trend growth. Moreover, there will very likely be some softening of labor market conditions. While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses. These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.

Again, I don’t find any of that surprising. Anyone who thought the Fed was going to kill inflation without some impact on the real economy is not living in the real world. Now, we could have a long discussion here about how growth doesn’t cause inflation but that probably isn’t the most efficient use of our time. Suffice it to say that higher interest rates – and more importantly the reaction to those higher rates – will have an impact on growth and the labor market. The right question isn’t whether there will be some pain, but rather how much?

The second part that drew attention was this reference to the timeline:

That brings me to the third lesson, which is that we must keep at it until the job is done.

It was these two lines, according to most of the market commentators out there, that pushed the S&P 500 down 3.4% on Friday. As you might guess by now, I disagree. Vehemently. There was something significant in this speech but it had nothing to do with Powell’s vow of higher rates for longer (I guess “lower for longer” has been retired). The most significant paragraph was this one:

We are moving our policy stance purposefully to a level that will be sufficiently restrictive to return inflation to 2 percent. At our most recent meeting in July, the FOMC raised the target range for the federal funds rate to 2.25 to 2.5 percent, which is in the Summary of Economic Projection’s (SEP) range of estimates of where the federal funds rate is projected to settle in the longer run. In current circumstances, with inflation running far above 2 percent and the labor market extremely tight, estimates of longer-run neutral are not a place to stop or pause.

Remember after the last post-FOMC press conference when Mohamed El-Erian and a bunch of other Fed watchers said Powell must have misspoken when he referred to the current level of rates as “neutral”? I don’t remember if it was El-Erian but someone even characterized Powell’s neutral statement as embarrassing.

Well, if you didn’t hear him the first time, he just told you, in that paragraph above, that he didn’t misspeak, that the current policy rate is indeed what he believes to be neutral. So, when he says that the policy rate needs to rise above neutral all he’s saying is that it needs to rise from here. Based on listening to every Fed talking head all week at Jackson Hole, the consensus seems to be that rates need to rise to 3.5 – 3.75%.

That is exactly what the market is expecting by the way. We can see that through a variety of futures markets including SOFR (secured overnight financing rate; the replacement for LIBOR), Eurodollars, and Fed funds themselves. A model developed by the Atlanta Fed that uses Eurodollar futures options and SOFR swap spreads has Fed Funds peaking in March of 2023 at 3.76%. And that didn’t change before, during, or after Powell’s speech. SOFR and Eurodollar futures were basically unchanged on Friday.

By the way, another indication that the market was already expecting the “higher for longer” narrative is that the peak and subsequent inversion of SOFR and Eurodollar futures has been moving further out the calendar recently. 6 weeks ago both expected rates to peak between January and March of 2023. After the last FOMC meeting, the date of peak rates has been moving out and is now expected between March and June of 2023. And the difference between March and June is down to just about 5 basis points so if it keeps moving it will soon be moved out to between June and September. To simplify that, even if we assume that recession starts coincident with rates peaking, it is now a Q2 2023 event. That, in my opinion, is why stocks have been rising lately – the market no longer believes recession is imminent.

In fact, no matter where you look in the rates complex, Powell’s speech was a giant nothing. And so the question in my mind is, if the speech didn’t impact the bond and money markets did it really drive the DJIA down 1000 points? Well, there were other things going on Friday so let’s look somewhere else for an explanation.

The stock selloff in the morning may have been about Powell’s speech but there were two major new stories Friday that may have had a bigger impact. The first was this story by Politico that posted in the early afternoon:

Apple faces growing likelihood of DOJ antitrust suit
An antitrust lawsuit against Apple would be a dramatic escalation in the administration’s battle against the tech giants.

Politico, Friday August 26, 2022, 1:11 PM

The second news story was this one that came out around 3PM:

3M Can’t Use Bankruptcy to Halt Lawsuits Over Combat Earplugs, Judge Rules

• 3M Ruling Disrupts Company Strategy for Ending Soldiers Suits
• Unless Ruling is Overturned, 3M Faces 230,000 Jury Trials

Bloomberg, August 26, 2022, 3:00 PM

Both of those articles were unexpected and could have a large impact on corporate America. In the case of Apple, those of us old enough to remember can’t help but think back to the government’s pursuit of Microsoft in similar fashion at the turn of the century. The current administration is not exactly business-friendly but in this case, the backlash against big tech is bipartisan. The outcome could be a big deal for Apple’s bottom line and more importantly, could be a distraction for years to come.

The 3M news was also a bit of a shock. I think most people thought – after the ruling in the similar Johnson & Johnson baby powder case – that 3M’s liability would be confined to the subsidiary. So, now we have two judges in two different districts basically coming to polar opposite conclusions. It isn’t coincidence that J&J’s stock went straight down with 3M in the afternoon.

I think the potential impact on the markets from these cases is much greater than anything Jerome Powell said or might say or do. I can’t say for sure that it is why stocks sold off so hard Friday afternoon but it is a much more satisfying answer than Powell’s speech.

Don’t assume that the reasons for a market event are really what you see in the headlines. It is impossible on most days to figure out what caused investors to buy or sell. And more often than not, like the Sherlock Holmes story about the dog that didn’t bark, the answer to the mystery of why the market moved today is not the most obvious one. Sometimes the thing no one talked about is more important than the thing they talked about all day."

MY COMMENT

YEP......exactly. There was simply NOTHING new in the Powell speech that has not been the norm for at least six months now. When I see these big drops like Friday....I immediately think.....AI Trading programs......which always seem to act in unison and drive the markets down much more than is rational. BUT.....that is what these types of programs are intended to do......drive market direction and than push it to the max for the short term micro-second trading gains.

What is the real joke.....is the media playing the game of identifying.....every day......why the markets went up or down. In reality the have NO CLUE what and why the markets did what they did.

 

And to continue....this little theme.

What to Make of Powell’s Speech at Jackson Hole
Friendly reminder: Don’t read too much into central bankers’ words.

https://www.fisherinvestments.com/en-us/marketminder/what-to-make-of-powells-speech-at-jackson-hole

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

"Investors have faced many challenges this year. The latest test: After rallying over the past two months, stocks dipped this week and closed on a big down note, with many fretting about Fed Chair Jerome Powell’s keynote address at Jackson Hole, Wyoming’s big central banker symposium. Powell’s speech was just 1301 words, yet financial headlines spewed oodles of pixels trying to make sense of it all—some blaming him for Friday’s selloff. That is possible, as daily volatility can happen for any (or no apparent) reason. But looking more broadly, Powell didn’t say anything noteworthy. Most of those parsing Powell’s words make much out of very little, and we suggest investors refrain from doing the same.

Powell’s eight-minute speech focused on inflation, the Fed’s commitment to price stability (mentioned nine times!) and a historical review of past monetary policy. As the Fed head noted, “Restoring price stability will likely require maintaining a restrictive policy stance for some time,” and he concluded with this headline grabber: “We will keep at it until we are confident the job is done.” Unsurprisingly, central bank observers did their best English major impression reading into Powell’s words. His callback to past Fed Chairman Paul Volcker? Clearly this Fed will attack inflation with gusto. Acknowledgement that higher interest rates may hurt households and companies? Get ready for even more rate hikes. A commitment to not stopping prematurely when tackling inflation? Prepare for a long stretch of restrictive monetary policy.The upshot: Many believe the Fed is willing to whack the economy to tame prices, so brace for trouble now.

Yet from our reading, Powell didn’t share anything new. Rather, he reiterated long-discussed stances. Go back to March 2022, a week after the Fed hiked rates for the first time since 2018. At a speech for the National Association for Business Economics, Powell observed, “… inflation is much too high. We have the necessary tools, and we will use them to restore price stability.”[ii] He sang a similar tune to Congress in June. The Jackson Hole speech conveyed more of the same, including what will influence the Fed’s decision-making. Powell noted, “Our decision at the September meeting will depend on the totality of the incoming data and the evolving outlook. At some point, as the stance of monetary policy tightens further, it will likely become appropriate to slow the pace of increases.”[iii] (Boldface emphasis ours.) In our view, that is a version of saying monetary policy remains “data-dependent”—a squishy, ambiguous approach popularized by Fed officials years ago.

Despite little here being new, many experts can’t help themselves from extrapolating words into action (e.g., projecting the quantity and magnitude of rate hikes to come this year and next). Mostly we just found it perplexing that after pledging to stop issuing forward guidance in late July, Powell is now saying something that smells a lot like forward guidance. If Fed people can’t even keep their own pledges to stop hinting at what they will do, how on earth can the actual hints be worth a darn? This is the problem with treating central bankers’ words as a guide for future policy: They aren’t and never have been.

Consider the Fed’s 2% y/y target, established in 2012, for the headline Personal Consumption Expenditures Price Index (PCE). The Fed hit that target just three times in eight years despite all its forward guidance attempts. The central bank then updated its framework in 2020, instead aiming for “inflation that averages 2% over time,” though they never explicitly defined “average” and “over time.” In our view, the Fed ditched its specific target for a much squishier one. After all, it is much easier to achieve an objective when you can define it after the fact.

Now, to be clear, we aren’t knocking central bankers for missing their targets. We aren’t aware of anyone who can forecast the future accurately, reliably and consistently. Nor do we think monetary policy has a pre-set economic impact. The notion of a Fed pulling one lever here and pushing another lever there to manipulate economic growth and inflation rates has always been far-fetched. The economy is too decentralized for central bankers to be able to fine-tune it.

But this is why we think investors shouldn’t treat central bankers as all-mighty entities with special economic insight and power. In our view, the Fed is reacting to developments in real time just like the rest of us, without much ability to foresee the exact consequences of its actions. So don’t treat central bankers’ words as particularly special or indicative of what is to come—much less how the economy and markets will adjust. Like other humans, Fed officials can (and do) change their minds based on new information. Making investing decisions based on their latest, imperfect economic assessments could be a mistake—especially if things don’t play out exactly as projected today."

MY COMMENT

YES.....again......nothing new, nothing to see here. The breathless media reaction and the usual suspects rushing out to give interviews to bolster their ego and reputation......is simply a JOKE.

IGNORE it all.

 

Lately I have been seeing a few new.....or.....inexperienced.....investors commenting on market timing in some media sources...... outside of this board.

It is always the same thing that I have seen my whole life. The line goes....."well the markets are simple to make money, you wait till your good stocks are nicely UP and than you sell......when they drop back down, you BUY. It is that simple".

Of course I have yet to see a single investor over my 55+ years of investing......that can do this simply strategy and make extraordinary.....or even average...... returns. In fact it is RARE that anyone doing this strategy can meet the unmanaged averages or even get close. This is the simple reason that the average investor lags the SP500 by about 6-8% per year long term.

When I hear and see this sort of "stuff".....I just laugh to myself and move on. There is no need to comment or argue.....it is a waste of time.

 

I skipped the market open today to stay in bed. We did a show last night, and I knew the markets did not need my help to get open today.

I dont expect to get any today....but I will say it just to start to push the markets back away from the edge of the bear market cliff......SHOW ME THE MONEY.

 

Our labor and employment markets and data is TOTALLY screwed up right now. They have NEVER come close to recovery after the pandemic.

Job openings top 11.2 million in July, well above estimate and nearly double the available workers

https://www.cnbc.com/2022/08/30/jolts-july-2022.html

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

"Key Points

• Available job positions in July totaled 11.24 million for the month, well in excess of the 10.3 million FactSet estimate.
• That total also was nearly double the total pool of available workers, which stood at 5.67 million for the month.

There were nearly 1 million more job openings than expected in July, an inflationary sign that the U.S. labor market is still extremely tight, the Bureau of Labor Statistics reported Tuesday.

Available positions totaled 11.24 million for the month, well in excess of the 10.3 million FactSet estimate, according to the Job Openings and Labor Turnover Survey. The total was about 200,000 higher than the 11.04 million in June, a number revised up from the initially reported 10.7 million.

Federal Reserve officials watch the JOLTS numbers closely for signs of slack in hiring.

The July numbers reinforced that there is still a considerable shortage of workers for available positions, with openings outnumbering available workers by just shy of a 2-to-1 margin. That, in turn, is inflationary as employers are forced to offer higher compensation to attract workers at a time when prices are rising near their fastest pace in more than 40 years.

Hiring declined during the month, falling to 6.38 million. Quits, a closely watched metric for worker confidence, also dropped, down to 4.18 million as those leaving their jobs as a percentage of the workforce declined one-tenth of a percentage point to 2.7%, still relatively high by historical standards.

Changing jobs has proven lucrative during the Covid era, with switchers seeing an average 6.7% annual wage growth rate, well ahead of the 4.9% rate of those who have stayed in their positions, according to the Atlanta Fed.

Total separations declined slightly in July to 5.93 million, as the rate edged lower to 3.9%. Layoffs and discharges were little changed at just under 1.4 million.

The JOLTS report comes three days ahead of the closely watched August nonfarm payrolls release Friday from the BLS. The Dow Jones estimate is for growth of 318,000, but the job openings numbers add potential upside to that count as companies continue to look to hire.

Fed Chairman Jerome Powell at last month’s meeting noted an “extremely tight labor market” in his remarks about the central bank’s efforts to bring down inflation.

Powell warned that ongoing hikes likely would result in “below-trend economic growth and some softening in labor market conditions.”

“But such outcomes are likely necessary to restore price stability and to set the stage for achieving maximum employment and stable prices over the longer run,” he added.

However, signs that hiring demand remains robust indicate that the rate increases may not be slowing growth as much as the Fed has hoped.

Traders upped their bets that the Fed will enact a third consecutive three-quarter point interest rate hike at its September meeting. The probability for that move over a half-point increase was 76.5% on Tuesday morning, according to CME Group data."

MY COMMENT

Obviously we have NO CLUE what is going on in the economy right now. The FED has no clue. No doubt the above jobs data will get worse when it is revised later on down the road. We have severely disrupted the equilibrium of the economy with the ridiculous pandemic shut down.....(for two weeks?)......and now we are finding out that it is nearly impossible to re-establish what we had before.

AND....yes.....I still believe we are currently in a recession and have been for months now.

 

Agree Rayak. The 2008/2009 crisis was not caused by inflation or deflation. It was caused by IDIOTIC housing policies....from government of course......and the extremely risky derivatives and collateralized debt obligations that it all fueled.

As it all collapsed.......we were just a hair away from a world wide economic and banking collapse.

 

Another moderate/medium loss day for me again today. Not bad considering. Every position was red in my account. BUT......drum roll please......I did manage to beat the SP500 today. By.....0.02%. That is my victory for the day.