The Long Term Investor

NOT good short term news for TESLA stock owners.

Tesla slides as logistic issues widen deliveries and production gap

https://finance.yahoo.com/news/tesla-slides-logistic-issues-widen-115842949.html

Currently down by about 9%.

 

About time we had a good day. I was nearly ALL green. TSLA screwed my on that front and also in terms of beating the SP500 today. I ended up losing to the SP500 today by 0.35%.

Not that I care.....it was a nice BIG gain today.

 

Here is the BEAUTIFUL day that we had today.

Stocks surge to kick off October and a new quarter as bond yields tumble, Dow closes up 760 points

https://www.cnbc.com/2022/10/02/stock-market-futures-open-to-close-news.html

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

"Stocks rallied Monday to start the new month and quarter, as Treasury yields eased from levels not seen in roughly a decade.

The Dow Jones Industrial Average ended the day 765.38 points, or nearly 2.7%, higher at 29,490.89. The S&P 500 rose about 2.6% to 3,678.43, after falling Friday to its lowest level since November 2020. The Nasdaq Composite advanced nearly 2.3% to end at 10,815.43.

It was the best day since June 24 for the Dow, and the S&P 500′s the best day since July 27.

Those moves came as the yield on the 10-year U.S. Treasury note rolled over to trade at around 3.65%, after topping 4% at one point last week.

“It’s pretty simple at this point, 10-year Treasury yield goes up, and equities likely remain under pressure,” Raymond James’ Tavis McCourt said. “It comes down, and equities rally.”

Wall Street is coming off a tough month, with the Dow and S&P 500 notching their biggest monthly losses since March 2020. The Dow on Friday also closed below 29,000 for the first time since November 2020.

The Dow shed 8.8% in September, while the S&P 500 and Nasdaq Composite lost 9.3% and 10.5%, respectively.

For the quarter, the Dow fell 6.66% to notch a three-quarter losing streak for the first time since the third quarter of 2015. Both the S&P and Nasdaq Composite fell 5.28% and 4.11%, respectively, to finish their third consecutive negative quarter for the first time since 2009.

The rally Monday is unsurprising considering how oversold markets have been, according to Sam Stovall, CFRA chief investment strategist.

“Because the S&P was down more than 9% in September... because the ISM was weaker than expected – ditto for construction spending – people are now surmising, hey, maybe the Fed won’t be as aggressive,” he told CNBC. “As a result, we’re seeing yields come down, we’re seeing the dollar weaken. Those factors are contributing to the move we’re seeing today.”

As the new quarter kicks off, all S&P 500 sectors sit at least 13% off their 52-week highs. Nine sectors finished the quarter in negative territory.

Investors were just starting to lose hope for a year-end rally, but Stovall said the market could still get one, noting that year-end rallies are historically stronger in midterm election years.

“We could see a rally because these fourth-quarter midterm election years are the second-best average quarter and also have the second-highest frequency of advance,” he said. “The best one is the next one, meaning the first quarter of the third year. We could be surprised with at least a near-term upward movement.”

Stocks close higher to kick off October trading

The major averages retained their gains throughout the day Monday to end their first trading day of October and of the fourth quarter of the year on a high note.

The Dow Jones Industrial Average ended the day 764.52 points, or 2.7%, higher at 29,490.03. The S&P 500 rose 2.6% to 3,678.43, after falling Friday to its lowest level since November 2020. The Nasdaq Composite advanced 2.3% to end at 10,815.44.

Utilities are among leaders on first day of new quarter, helped by falling yields, weaker natgas and deals

Utility stocks are helping to lead the broader market higher, alongside energy, materials shares Monday. The Utilities Select Sector SPDR Fund rose as much as 3.5%. NextEra — accounting for one sixth of ETF — gained 3.7%, while Southern Co. added as much as 3.4%, and Duke Energy climbed 3.2%.

Utilities carry so much debt and have such demanding refinancing needs that they often get a lift from falling bond yields. Utilities’ above-average dividend yields also face less competition when Treasury yields weaken. The 10-year Treasury yield got as low as 3.58% Monday, down from 3.83% Friday.

Meanwhile, near month Henry Hub natural gas futures are falling 4% — the only contract in the energy complex that’s weaker.

Utility investors also saw Monday deal flow: Con Ed agreed to sell its Con Edison Clean Energy Businesses to Germany’s RWE for an enterprise value of $6.8 billion, while Algonquin Power will sell stakes in U.S. and Canadian wind farms to InfraRed Capital Partners.

Finally, Credit Suisse began research coverage on five utilities Monday: Dominion Energy, Exelon and Constellation Energy were rated outperform while Alliant Energy and Edison International were rated neutral.

Con Ed is ahead 3.5%, Algonquin is rising almost 5%, Dominion is higher by 3.1% Exelon by 2.8% and Constellation by 3.8%."

MY COMMENT

Every once in a while we need a little shot in the arm. Today was it. The next step is to extend this little one day rally to the entire week.

 

Yeah....agree....Zukodany. I dont see this European bank stuff having any impact on us....other than psychological. BUT....what you never know with these sorts of BIG BANK issues is how many other banks through various investments, derivatives, partnerships, etc, etc, are tied into them......and as a result if they did happen to go under.....( I dont believe they are even close at this point).....how many other smaller banks and businesses will they drag down with them. I never discount the crazy stuff that these banks can get themselves into.

I am likewise thinking that this year is TOAST. Although.....I am open to a strong rally over the final months of the year.....if the markets decide to reward us with something for sitting through this DREARY year for the markets. I guess I am holding out hope for a post-election market bounce lasting all the way to year end. Like the elections.....I give it about a 50/50 shot.

LOL......even a little one day rally like today.....seems like a treat lately.

OK.....one in a row.....lets make it two tomorrow.

 

Carry over rally today. Can it stick? Check back in about 6.5 hours. A very STRONG move in the markets over the past 1+ days.

 

I like this article.....there is a lot of RATIONAL TRUTH in here. In some ways painful to re-live and look back in hindsight at what we did to the economy, business, investors and the country.

You weren’t supposed to see that

https://thereformedbroker.com/2022/10/02/you-werent-supposed-to-see-that/

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

"I’m going to tell you a quick story in the order in which it happened. You were there. You will be familiar with the sequence of these events. But you may not have reached the shocking conclusion that I have. At least not yet. Wait for it…

Our story begins in 2019…

It was the best of times, it was the best of times. The tail end of a decade of uninterrupted asset price appreciation for the top decile of American households who own 89% of the US stock market and 70% of all of the wealth. Not only did they ride this wave higher, they even figured out a way to have their cake and eat it too – a way to not even have to sell any of their assets to maintain the costs of a top ten-percenter lifestyle. Securities based lending. A silver bullet.

The banks were more than happy to arrange a loan against any stock, bond or building in their clients’ portfolios. And why not? This way, no one had to sell and pay taxes while the money under management remained sticky and eligible for fees forever. You could be rich, stay rich, borrow at will, never come out of pocket, never give up your piece of the pie and yet still be able to pay for whatever you wanted. Clients loved it, banks loved it, financial advisors and fund managers loved it.

It was a win-win engineered by the cleverest of the clever on Wall Street and a decade of ultra-low interest rates courtesy of the Federal Reserve and central banks around the world. Stock market volatility was minimal, taxes were low and borrowing costs were so slight they may as well have not even existed. Never before was it so easy to finance, accumulate and maintain a portfolio of real and financial assets – from private real estate to startup shares to public stocks to fixed income of every sort and stripe. The upper class was floating away on an endless river of cashflows and capital gains. Meanwhile, prices and costs in the real economy barely budged. Income and wealth inequality soared but it was hard to say the “winners” were directly hurting anyone or causing any harm to any other group. It’s just that they were noticeably pulling ahead of everyone else at faster rates. But everyone was advancing to some degree, so, whatever. Life went on.

So long as inflation remained in check, the Fed could more or less manage the stock market with occasional quarter-point rate hikes or rate cuts and a smattering of speeches here and there.


And it worked beautifully – here are the annual inflation rates (as measured by CPI) for the years leading up to this ecstatic moment in the history of American-style capitalism:

2015: .12%
2016: 1.26%
2017: 2.13%
2018: 2.44%
2019: 1.81%

The economists couldn’t believe the marvels of the disinflationary era. We had lived through decades of “the great moderation” following the peak of prices in the 1980’s but the last few years of it were truly extraordinary. It broke all of the models and core tenets of how we thought money was supposed to work. If people were willing to pay their governments interest to hold their money for them – and they were – then nothing made sense and all of our assumptions about “rational actors” in the capital markets were up for a reexamination. At one point during the summer of 2019, some $15 trillion worth of sovereign bonds, or one quarter of the overall global bond market, had negative interest rates. There was too much money sloshing around in these countries and the central banks were basically saying “go invest or spend it, we don’t need it but hopefully you do.” The bond yields in Japan, Germany, France, Sweden, the Netherlands and Switzerland were all deeply negative.

People in the know were utterly mystified by how all of this free money wasn’t causing enormous amounts of inflation in the real economy, let alone how it could actually be feeding into the disinflation being felt everywhere. They blamed tech (“Software is eating the world”), they blamed globalization, they blamed just-in-time inventory strategies, they blamed China (“They’re exporting deflation!”), they blamed millennials (“They’re not having sex! They’re not starting families and buying homes!”), they blamed indexing and ETFs (“It’s a gateway drug to communism!”) and, when all of that failed to explain the lack of inflation, they blamed the statistics themselves (“Obama! He’s hiding something. He’s in on it with the Jews and the lesbians! They’re taking over the pizza parlors in Washington D.C. for their satanic sex rituals and suppressing the inflation stats to keep Donald Trump Jr. from discovering the true location of the treasure chest Jesus Christ gave to George Washington for safekeeping in 1984!”). I wish I was kidding about that last thing, but I am not. We are surrounded by imbeciles. Social media has enabled the village idiots of every town and region to discover each other and band together in the millions. Society is actually regressing intellectually for the first time since the Dark Ages. We’ll get to that some other time.

Anyway…

Even after all these tortured economic theories were run through the financial media’s military-industrial spin cycle, deconstructed and recombined into takes on takes on takes, endlessly ricocheting off the walls of a thousand pdfs, we were no closer to having a real understanding of how a phenomenon such as this could even be possible in the first place, let alone how it could run on for as long as it did, year after year.

And then the pandemic came along a few months later and, without knowing it, we were about to run the greatest economic experiment since the Great Depression, in real-time, for all to see. Everyone got to participate in this experiment, whether they wanted to or not. Every existing person in our economy – from the CEO of the largest publicly traded company in America to the lowest paid employee of the smallest commercial farm – we would each be assigned a role to play. Every single one of us – that’s how big this experiment would be.

Most experiments start with a question. A hypothesis is then proposed to answer that question. A test of the hypothesis is devised and then carried out. It is proven true or false.

Our experiment started out with the following question: “Can we shut the economy down for a health emergency and not cause a second Great Depression?”


The answer turns out to have been “Yes, we can.”

The hypothesis was that if we print enough money so that no one falls behind on their bills, we can effectively shut down all but essential commerce for an indeterminant period of time and most people will be okay. It took a lot of money, but it basically worked.

We carried out stimulus in several ways but the most notable thing we’d done was brand new: Direct payments to regular people whose employers had permanently or temporarily asked them not to show up for work. This happened in three rounds of payments. These numbers are taken directly from the government’s pandemic oversight agency:

Round 1, March 2020: $1,200 per income tax filer, $500 per child(CARES Act)
Round 2, December 2020: $600 per income tax filer, $600 per child (Consolidated Appropriations Act)
Round 3, March 2021: $1,400 per income tax filer, $1,400 per child (American Rescue Plan Act)

To prevent companies from conducting mass layoffs of their employees, the Paycheck Protection Program or PPP was created. Beginning in late March of 2020, and continuing over the course of two rounds, a total of $792.6 billion went out to 11.5 million small and midsized businesses. Over 10 million of those loans ended up being forgiven (not repaid) or $742 billion worth. My firm borrowed money under the Paycheck Protection Program during the unprecedented uncertainty of early April 2020 and then repaid the loan in its entirety two months later in June. Almost none of the program’s borrowers saw fit to do the same. It’s possible that the 90% or so of firms who kept the money genuinely needed to. I don’t sit in judgment of people and situations I have no knowledge of so I will leave that debate for others. But the money was almost entirely kept, so we’re talking about another three quarters of a trillion dollars of stimulus remaining in the economy and never coming out.

The Coronavirus Relief Fund was created to get money to states and cities. A total of $150 billion was sent to almost 1,000 entities, from the Governor of Texas to the Treasurer of California, the Commonwealth of Kentucky to the Executive Office of the State of Wyoming.

Then there was the State and Local Fiscal Recovery Fund (or SLFRF if that’s easier to pronounce, and it isn’t). $350 billion distributed to 1,756 states, territories, cities, and counties with populations over 250,000. Bergen, New Jersey. Albuquerque, New Mexico. Tampa, Florida. Green Bay, Wisconsin. The money went everywhere and to everyone for everything.

Throw in another $186 billion through the Provider Relief Fund to support hospitals and healthcare organizations of which $134 billion was actually sent out. Then there was another $16 billion in the form of the Shuttered Venue Operators Grants – cash handouts for movie theaters, Broadway, museums, etc. The Restaurant Revitalization Fund (or RRF) was another $28.5 billion with an average grant amount of $283,000 to over 100,000 recipient restaurants. This is above and beyond whatever they got in paycheck protection, tax and rent relief, etc. They needed money to convert their dining rooms for additional spacing and plexiglass enclosures for ordering counters and hand sanitizer and masks and all sorts of other stuff that didn’t end up working at all.

In total, the Federal government created $4.3 trillion in direct economic stimulus of which $3.95 trillion was dropped onto the economy, as if by helicopter, in a period of under 18 months. There were people comparing the dollars spent on the government’s pandemic response to the spending America did on World War II. This is a silly comparison, especially when calculated as a percentage of GDP, but the point is that there are few other things you could compare it to that would even be in the same ballpark.

And while the Treasury was disbursing all of this money into the bank accounts of business owners and workers, the Federal Reserve was doing its part on a parallel track, with the bank working “hand in glove” with the federal government. Interest rates were slashed to zero and the Federal Reserve began an asset purchase program designed to re-liquify financial institutions by buying Treasury bonds and mortgage bonds from them at prevailing prices, no questions asked, to the tune of $120 billion per month, every month, for an unspecified period of time (which turned out to have been almost two full years!). This led to unprecedented liquidity in the system and plunging borrowing rates for corporations, which would eventually lead to record profit margins for the S&P 500, record stock buybacks and one of the greatest bull market rallies in history.


Between March 23rd, 2020 (the day stocks bottomed) and August 16th, 2021, the S&P 500 had doubled from 2237 to 4479. It took just 354 days, the fastest double in stock market history back to World War II. In the one year period from March 2020 through March of 2021, 0ver 95% of all S&P 500 component stocks had a positive return. In calendar 2021, over 1,000 companies came public, wiping out every initial public offering record on the books.

We used the term “unprecedented” so many times in this era, heedless of Pee-Wee Herman’s warning, that we effectively wore it out. But it was no exaggeration. Everything was unprecedented.

Trillions of dollars in cash hit people’s bank accounts while the balances in their brokerage and retirement accounts exploded higher and the value of their real estate soared. The cost of their household debt shrank and even the used cars parked in their driveway had appreciated in value. There wasn’t a lot to do so their monthly expenses declined and their savings rates rose. According to Federal Reserve data, by the end of 2021 the median American had never been in better shape. Household net worth rose to a new record in the fourth quarter of 2021, totaling $150.3 trillion which was up 3.7% or $5.7 trillion from the previous quarter, and 14.4% from the end of 2020.

And things were good.

Here’s the thing about the pandemic experiment: It worked too well.

Everyone had money. Everyone had options. There was a bull market in people forming their own LLCs and starting companies. A bull market in sitting on their asses and doing nothing too. A bull market in quitting their jobs. A bull market in whatever they felt like doing. Indulging their hobbies, accepting flexible hours, moving their residence, taking college classes while being employed, secretly having two full time employers, quitting without quitting, being paid for waking up in the morning, taking extended periods of time in between gigs, making a big career change. Whatever people wanted to do, they could do. Freedom on a previously unimaginable scale.

Young know-nothings from all walks of life were investing in digital art and SPACs, trading options on their phones, starting their own companies, selling their own weed and launching their own crypto projects. Older ordinary people found themselves accidentally wealthy overnight, their houses instantly worth 30 to 50% more almost regardless of condition or geography, the values of their 401(k)’s bursting at the seams, potential buyers for their small businesses and real estate holdings coming out of the woodwork with blank checks ready to be signed at the conclusion of a Zoom meeting. You could sell anything to anyone for any price at any time. We were minting millionaires by the minute.

Capitalism felt like it offered possibilities for everyone for the first time ever. Influencers fluent in the language of entrepreneurship and personal finance had a potential audience in the millions for their messaging. The world was ripe with possibility and people felt emboldened. They were liquid and ready to maximize their own opportunities. It was an exciting moment in time. No one was left out.

And that was the problem.

Widespread prosperity, it turns out, is incompatible with the American Dream. The only way our economy works is when there are winners and losers. If everyone’s a winner, the whole thing fails. That’s what we learned at the conclusion of our experiment. You weren’t supposed to see that. Now the genie is out of the bottle. For one brief shining moment, everyone had enough money to pay their bills and the financial freedom to choose their own way of life.

And it broke the fucking economy in half.

The authorities are panicking. Corporate chieftains are demanding that their employees return to the way things were, in-person, in-office, full time. The federal government is hiring 87,000 new IRS employees to see about all that money out there. The Federal Reserve is trying to put the toothpaste back into the tube – the fastest pace of interest rate hikes in four decades and the concurrent unwind of their massive balance sheet. Everyone is scrambling to undo the post-pandemic jubilee. It was too much wealth in too many hands. Too much flexibility for too many people. Too many options. Too much economic liberation. “Companies can’t find workers!” the media screams but what they really mean is that companies can’t find workers who will accept the pay they are currently offering. This is a problem, we are told. After decades of stagnating wages, the bottom half of American workers finally found themselves in a position of bargaining power – and the whole system is now imploding because of it. Only took a year or so.

The War on Inflation™ is the new War on Drugs. In the 1980’s they were willing to sacrifice entire cities and communities to the War on Drugs. A million brothers and sons behind bars, a million children in fatherless homes in service to some nebulous goal of a drug-free society that’s never actually existed at any time in human history. We figured out how to ferment barley to get intoxicated more than 13,000 years ago, which predates the invention of the wheel for god’s sake. The War on Drugs had less of a chance of working than Prohibition did. We went ahead and destroyed countless lives with it anyway.


Now we have a new war.

Today they’re willing to sacrifice the stock market, the bond market, housing values, anything – there’s nothing they’re not willing to do to get it all back under control. Over $10 trillion in wealth wiped out this year, a sacrifice on the part of wealthy Americans in order to ensure a return to normal. You’re hearing the term “normal” a lot these days or normalization. Normal is 2019, where the rich had unlimited options and the not-quite rich had the chance to join them someday by helping to maintain the status quo. The working poor had no options in this world but had lots of obligations. It’s just how things were. This kept the economy humming on an even keel. It was necessary. It was “normal.” It’s what the Federal Reserve is willing to crush the stock market and the real estate market in order to return to. Every time you hear a Federal Reserve official use the word “pain” they are really saying “recession” and when they say “recession”, which they are loathe to do, they are actually referring to people losing their jobs so that wage gains return to a “slower trajectory.” You are being fucked around with, assaulted with the English language and all its inherent trickery. The Greater Good requires a less good circumstance for millions of workers. Too many Chiefs, not enough Indians for the game to run smoothly.

They cannot say any of these things out loud in plain terms. But what they want, what they need, is a shittier situation for the bottom of the income distribution in order to preserve the advantages of the professional and managerial classes who ran the pre-pandemic establishment. It’s not pleasant to admit out loud. No politician or authority figure wants this included in the talking points. It’s not exactly an applause line.

We have to fight the War on Inflation, the story goes, because it is going to hurt the lower income people in our society most. Never mind that the lower income people are actually the biggest beneficiaries of the current labor shortage. Never mind the fact that, when it comes to inflation, the lowest income Americans are most affected by gas prices, which a) have already fallen and b) are completely outside of the control of the central bank anyway. So they’ll distract us with a never ending parade of bullshit lest we consider the truths unleashed in our economy last year. Look over there, Kanye West is doing something insane! And look at that! Marjorie Taylor Greene is using the N-word again! Joe Biden’s adult son just packed his own spleen into a crack pipe and smoked it! Look at Kim’s ass! Yes, you’ve seen it before, but still! And look over there, abortion rights in Alabama under siege! Trump stole the nuclear codes! New Lord of the Rings content on Amazon Prime. Game of Thrones is back. The NFL returns!

Look here, look there, look anywhere else. Just don’t look at the almost-liberated wage slaves being put back into their places. How dare you ask for more, how dare you expect more? Stock trading time is over, get back to loading these cardboard boxes.

I know we’re not supposed to admit these things about our system. We’re not supposed to say them aloud in polite company. But how can you say they aren’t true? How can you say that the reality is anything other than what you’ve just witnessed with your own eyes?

When some people have prosperity and the American Dream is still a brass ring for the masses to reach for, the system works. Everyone stays in line. When the American Dream is actually attained – by everyone all at once – the system buckles. That’s what you’re living through today. There isn’t a moment to lose. We have to hack off a couple of limbs to save the patient. Emergency surgery. Four hundred and fifty basis points of interest rate hikes in nine months. We went from trying to prevent layoffs to daring companies not to do them inside of a single calendar year. We’ll make it worse, just you wait and see. The beatings will continue until the desks are filled and the warehouses are staffed. Until everyone gets back in line. Then, and only then, when the world is normalized, can the pain come to an end.

And please, for the love of god, forget what you saw last year. You weren’t supposed to see that."

MY COMMENT

In hindsight it all seems pretty INSANE. AND.....this little economic commentary does not even get into what happened with freedom and the sudden REMOVAL of the CONSTITUTION and "your" constitutional rights......because we were in an "emergency".

AND....surprisingly....little to no politics in the above. It is actually ALL based on "CLASS" and not "politics".

 

Lets hope this holds true for this year......we could use something to boost the markets.

The Stock Market Has Risen After Every Midterm Election Since 1950

https://www.forbes.com/sites/michae...-midterm-election-since-1950/?sh=5db2697d7c48

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

"It’s easy for investors to be gloomy following a rough September in which the S&P 500 Index tumbled 9.2%. That marked the worst September showing since 2002, when the index fell by 11%.

Before you hit the panic ‘Sell Everything’ button, though, it’s worth considering at least one bullish catalyst on the horizon—voters head to the ballot box on November 8th.

The data is clear: Midterm elections are historically bullish for the stock market.

Midterm Election Cycles

Since 1950, there have been 18 midterm election cycles, and in the twelve months following each of those cycles, the stock market has had positive returns.



Source: Bloomberg

Silverlight Asset Management, LLC
PROMOTED


US stocks have consistently earned positive returns after previous midterms, and delivered average annual returns of 18.6% compared to 10.6% in all other years.


Still feeling bearish? But wait, there’s more...

If we lookout two years after previous midterm elections, the average return has been a blistering 33.7%.


Source: Bloomberg

Silverlight Asset Management, LLC
By now you may be wondering: Why are midterm elections such a bullish catalyst? Good question.

Why Stocks Tend To Rise After Midterms

Theories on the topic vary, but in my view the most compelling reason for why stocks tend to see above-average returns after midterms is because there’s a tendency for more gridlock in Washington following midterms. Investors think gridlock is good, because it means less legislative risk. And anytime there’s less macro uncertainty, it boosts investor sentiment.

Midterm elections typically bring a more divided government because the sitting President’s party rarely captures more seats in Congress. According to FiveThirtyEight, “One of the most ironclad rules in American politics is that the president’s party loses ground in midterm elections.”

America has long been a centrist country. Maybe that’s why voters routinely change their minds about how much power they want concentrated in one party’s hands.

Or, maybe the midterm swing has more to do with politicians’ tendency to overpromise on the election trail and underdeliver upon assuming office.

When my younger brother was in high school, he got to interview the oldest living American—who was 112 at the time. When he asked the gentleman if there were any consistent themes he noticed over his extraordinarily long life, his snarky response was, “All the politicians—from both parties—just tell you want you want to hear.”

Can’t argue with that.

Per RealClearPolitics, President Biden’s approval rating is currently hovering around 42%. If that sticks into November, history says it doesn’t bode well for Democrats’ chances in the House of Representatives.

“The president’s standing customarily is critical to his party’s fortunes in midterms,” according to Langer Research. “Each election has its own dynamic. But in midterm elections since 1946, when a president has had more than 50 percent job approval, his party has lost an average of 14 seats. When the president’s approval has been less than 50 percent—as Biden’s is by a considerable margin now—his party has lost an average of 37 seats.”

There is always a chance 2022 bucks the historical trend described above. After all, there is no shortage of macro concerns right now.

Inflation is obviously too high. The Federal Reserve was clearly behind the curve in taming budding inflation pressures last year, and many investors now worry the Fed is raising interest rates with reckless abandon.

In other words, earning positive returns between November 2022 and November 2023 isn’t assured.

That said, there is pervasive bearish sentiment now, and the midterm election cycle has one of the most compelling track records on Wall Street. Investors ought to consider that before abandoning solid long-term investments."

MY COMMENT

This is quite a record going back over 70 years.....no matter the political party in power. Lets HOPE that it holds this year and we see a nice year end rally all through November and December.

 

This PLUS the drop in Treasury rates could have something to do with the current rally.....although I note that mortgage rates are NOW averaging OVER 7%.

US job openings post biggest drop in nearly 2 1/2 years in August

https://finance.yahoo.com/news/u-job-openings-post-biggest-141456384.html

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

"WASHINGTON, Oct 4(Reuters) - U.S. job openings fell by the most in nearly 2-1/2 years in August, though staying at high levels as demand for labor remains fairly strong, which could keep the Federal Reserve on its aggressive monetary policy tightening path.

Job openings, a measure of labor demand, dropped 1.1 million to 10.1 million on the last day of August, the Labor Department said in its monthly Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday.

August's decline was the largest since April 2020, when the economy was reeling from the first wave of the COVID-19 pandemic. Data for July was revised lower to show 11.170 million job openings instead of 11.239 million as previously reported.

Economists polled by Reuters had forecast 10.775 million vacancies.

The Fed is trying to cool demand for labor and the overall economy to bring inflation down to its 2% target. The U.S. central bank has since March hiked its policy rate from near zero to the current range of 3.00% to 3.25%, and last month signaled more large increases were on the way this year."

MY COMMENT

This data continues to be so screwed up. AND.....not just the data.....the actual labor markets are TOTALLY screwed up. BUT still....it is good news.

 

And to piggy back on the above here is what you get.

Stock market news live updates: Stocks extend gains as investors hope for policy pivot

https://finance.yahoo.com/news/stock-market-news-live-updates-october-4-2022-111349006.html

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

U.S. stocks charged higher at the start of trading Tuesday as Wall Street maintained momentum from the previous session’s rally.

The benchmark S&P 500 surged 1.6% early into the session, while the Dow Jones Industrial Average jumped roughly 380 points, or 1.3%. The technology-heavy Nasdaq Composite was up 2.2%.

Equity markets kicked the month off on a high note Monday after an ugly September for the major averages. During the previous session, the S&P 500 soared 2.6% in its best day since July, the Dow rose 2.7% to mark its largest one-day gain since June, and the technology-heavy Nasdaq Composite gained 2.3%.

Nicholas Colas of DataTrek Research points out that the S&P 500 rarely rallies by over 2% in non-stressed market conditions, suggesting that Monday’s bounce was a sign of “fragility, not strength.” Between 2013 and 2019, for example, there were fewer than four such days in every year, while 2022 has had 14 so far.

“History strongly suggests that Monday’s 2.6% S&P rally is neither healthy nor a sign that the index has troughed,” Cola said, adding that reducing outsized volatility of the sort we have been seeing this year requires a shift by policymakers. “Markets have been trying to predict a turning point for Fed policy for months now, with as-yet little success given the ongoing strength in U.S. labor markets and still-high inflation.”

A gauge of U.S. manufacturing from the Institute for Supply Management (ISM) on Monday showed activity declined to the lowest since May 2020 – a contraction that stoked some optimism around a dovish Federal Reserve pivot. And adding to hopes central bankers may back off aggressive monetary intervention was a warning from a United Nations agency that policymakers may induce a global recession and a period of prolonged stagnation if they proceed with aggressive rate increases.

"Excessive monetary tightening could usher in a period of stagnation and economic instability," the United Nations Conference on Trade and Development (UNCTAD) said in a statement.

Bonds rallied alongside stocks on Tuesday, with Treasury yields falling for a second straight day. The benchmark U.S. 10-year note tumbled to around 3.5% after topping a 2008 high of 4% last week. The U.S. dollar index also fell lower.

On the corporate side, shares of Rivian (RIVN) rallied more than 7% after the company reiterated it was still on track to produce 25,000 electric vehicles this year, affirming its previous guidance.

Poshmark (POSH) stock jumped 13% on news the second-hand fashion retailer is set to be acquired by South Korean internet giant Naver Corp. in a deal valued at $1.2 billion.

Oil also extended Monday’s gains after a report OPEC+ is mulling a hefty production cut. West Texas Intermediate (WTI) and Brent crude oil futures each crept up roughly 1% to $84.42 and $89.83 per barrel, respectively."

MY COMMENT

YES....bond yields are down so the markets are UP. AND....here we go again......the old....."there might be a pivot" BALONEY.

NO....the FED is not going to back off. This stuff is simply delusional. They will CRASH the economy....before they find out that what they are doing will hardly work.

This is ALL financial media, big bank, stock trader.....BS. I have yet to hear ANY single regular investor talking about a FED PIVOT.

We appear to be in MAXIMUM CHAOS. Although I consider that a good thing.....when it comes to moving forward over the longer term.

 

WELL....time to sit back and let the markets run for the day. They dont need my help.....se are STILL seeing HUGE GAINS today.

We are NOW entering the DEADLY 11:00 to 12:00 East Coast time period......lunch time for ALL the professionals.

Lets ENJOY the day and the potential gains.

 

We are NOW way past the pandemic......I was sure that we would be back to "normal".....whatever that is....before now. It looks like we STILL have another 12-24 months to get over the pandemic shut-down and all the impacts on the economy. by the time we are done it appears that the impact will have been 4-5 YEARS. AND....unfortunately....little to NONE of the impact is due to the actual pandemic.....it is ALL due to what we did and how we tried to deal with it.....self-imposed confusion and pain.

 

No doubt he will turn it into a success.....he is a great leader.