A brief summary of JP (FED) comments for those that missed it or who may be interested. Draw your own conclusions. “We are prepared to do more if greater monetary policy restraint is warranted,” “A decision on a pause was not made today,” "Inflation remains well above our longer run goal of 2 percent," “Wage increases have been moving down, and that’s a good sign. Down to more sustainable levels, I think the case of avoiding a recession is in my view more likely than that of having a recession,” “There are no promises in this, but it just seems to me that it’s possible that we can continue to have a cooling in the labor market labor market without the big increases in unemployment that have gone with many prior episodes." “We on the committee have a view that inflation is going to come down not so quickly, “It will take some time, and in that world, if that forecast is broadly right, it would not be appropriate to cut rates and we won’t cut rates.” We’re going to need data to accumulate on that, [that’s] not an assessment that we’ve made that would mean we’ve reached that point,” he said. “I think it’s not possible to say that with confidence now.” (In reference to the funds rate being restrictive enough)
It appeared the markets lost momentum when he mentioned the part about not seeing cuts. I agree with W, folks are delusional if they thought cuts were anywhere near term. My general feeling (not that it matters), FED did as expected, they are leaving the door open on what "data" looks like going forward, and they slammed the door on any cuts in the foreseeable future. A day in the life of investing.....just remember it is only a day and tomorrow it maybe something else. Short term stuff can make great conversation, but long term makes comfortable retirements....
The markets and the people that drive the short term markets are.......so predictable. Stocks slide after Fed announces 0.25% rate hike: Stock market news today https://finance.yahoo.com/news/stock-market-news-today-live-updates-may-3-115856193.html "U.S. stocks fell on Wednesday after the Federal Reserve hinted at a potential pause to its rate-hiking campaign in June but indicated rate cuts were unlikely."....... "Stocks ticked up on the initial news but lost steam when Powell commented on the prospect of cutting rates."....... MY COMMENT HELLO McFLY........(as I knock on the head of the person that thinks there were going to be rate cuts this year).....repeat after me.......there will be no rate cuts this year,......there will be no rate cuts this year,......there will be no rate cuts this year, etc, etc, etc. In fact we will NOT get anywhere close to a 2% inflation rate......which is a good thing....since that would be borderline DEFLATION. AND.....my view is with what is out there at this moment....there will NOT be a recession either. AND.....JUST FOR GOOD MEASURE.....earnings next time WILL NOT suck, either. Although all the so called experts will predict dire earnings......for about the 10th quarter in a row now.
A mild to moderate loss for me today in my ten stocks. Seven were down.....after the FED freak out......and three were UP. The UP companies were AMZN, GOOGL, and TSLA. I did however get in a beat on the SP500 today in the amount of......0.20%. Better than a poke in the eye with a sharp stick. All in all a fairly mild and boring FED DAY. Now we move on to the APPLE earnings tomorrow. Those earnings....along with a reality check on the FED......could give us good potential for a couple of nice days in the markets to end the week.
Looks like we start the day with a topic we have seen before. Regional Banks. I guess we are going to do these one at a time now. It would not surprise me to see some of these end the same way at this point. They have some similarities for sure. Whether it works out that way, time will tell. The media is having a field day with it as expected.
Yes a combination of the MEDIA and the SHORT SELLERS......having a field day. Of course the short sellers are out in force providing information to their buddies in the media and egging the media on to drive their narrative and money making. Banks and financial companies are one of the areas of business that I NEVER invest in. They are way too erratic from quarter to quarter and year to year. This "stuff" makes my daily reading easier since I just skip over all the banking stories. Just short term drama and NOISE. I cant get real excited about any of it.....but....that is just me.
As to the FED..... The Fed Hikes Again, But the Thrill Is Gone https://www.fisherinvestments.com/e...ry/the-fed-hikes-again-but-the-thrill-is-gone (BOLD is my opinion OR what I consider important content) "Hike and pause or no, a broader look at the recent past shows the Fed likely isn’t a threat to stocks’ climb. Shocking no one, the Fed hiked its benchmark rate by another 25 basis points (0.25 percentage point) today, bringing the fed-funds target range to 5.0% – 5.25%. The world had largely already penciled that in, which may be why a slight tweak to the Fed’s statement grabbed most attention, fueling suspicion that it is done for now. As always, we wouldn’t read into it. But whether the Fed is done or keeps hiking, we doubt it means much for stocks. In past statements, the Federal Open Market Committee (FOMC, the cadre that makes monetary decisions) has included this language: “The Committee anticipates that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time. In determining the extent of future increases in the target range, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.” This time, the first of those two sentences was gone, while the second returned with some slight modifications. Even though it referenced the potential for future tightening, the absence of the “some additional policy firming may be appropriate …” bit is ratcheting up expectations that the era of rate hikes is over. Maybe it is. Back in the 2004 – 2006 tightening cycle, 5.25% was the peak fed-funds rate. In his post-meeting presser, Fed head Jerome Powell also acknowledged that the tighter credit conditions following the failures of Silicon Valley Bank, Signature Bank and now First Republic had done some of the FOMC’s work for them. “We won’t have to raise rates quite as high as we would have if this had not happened.” But also, it is entirely possible they keep going. Powell reiterated the Fed’s time-honored mantra that decisions are data-dependent. The statement stressed that point, too. Who knows how the 11 FOMC members will interpret the data arriving between now and June’s meeting. Or even what data they exactly emphasize or disregard, and what they think said data should do. Or how that will all evolve by July’s meeting and beyond. The Reserve Bank of Australia just hiked again after pausing in April. Anything is possible, and you can’t predict it in advance. Whether or not the Fed has more rate hikes to go, we see good reason to believe stocks won’t much mind. As Exhibit 1 shows, they have risen alongside rate hikes for over half a year now—even with the yield curve inverted. The S&P 500 may be down since rate hikes began in March 2022, but only by -3.7%, and they are up since the first 75 basis-point hike last June. Another hike or two wouldn’t much change overall banking conditions, considering that even with their recent increase, most deposit rates remain well below fed-funds. Movement on that front seems tied more to overall market conditions than what the Fed does. Exhibit 1: Rate Hikes Don’t Have Pre-Set Market Impact Source: FactSet and Federal Reserve, as of 5/3/2023. S&P 500 total return index, 12/31/2022 – 5/2/2023. This is true outside America as well. The Bank of England was the first major central bank to start hiking rates on December 16, 2021. Since then, the MSCI UK Investible Market Index (IMI) is up 18.6% in dollars and 8.8% in pounds.[ii] The European Central Bank was late to the party, starting on July 21, 2022. MSCI’s eurozone index is up 25.0% in dollars and 16.1% in euros since then.[iii] The investing world is stuck in the perception that rate hikes fueled last year’s bear market, and they probably did contribute to the deep pessimism that weighed on markets (along with inflation, oil prices and a host of others). Perhaps the fact the early hikes came as part of a giant Fed and central bank U-turn on inflation added to their surprise. But returns since last summer arguably tell a different story, one of stocks’ resilience and ability to get over widespread fears. It is time more investors started noticing." MY COMMENT YEP......we have been in a rising market for about 10 months now. It seems that the FED actions during those ten months did not really have much impact on a rising stock market. The FED is a psychological drag on the markets at times........but as we have seen from the earnings.....there does not seem to be much real world impact on business results. When investors and the financial media quit obsessing over the FED.....their power to move the markets will end. In any event we are now either DONE with rate hikes or will simply see one more hike in June. So we are either DONE now or will be in about a month from now. I consider that GREAT NEWS for investors and the markets.
HERE is the markets.....so far.....today. Stock slip as regional banks tank https://finance.yahoo.com/news/stoc...s-tank-stock-market-news-today-115208499.html (BOLD is my opinion OR what I consider important content) "Stock slipped Thursday morning as markets digested the latest interest rate hike from the Federal Reserve and more pressure on the regional banking sector ahead of a highly anticipated earnings release from Apple (AAPL). The S&P 500 (^GSPC) fell 0.24%, while the Dow Jones Industrial Average (^DJI) lost 65 points, or 0.19%. The technology-heavy Nasdaq Composite (^IXIC) was down 0.37%. Shares of regional bank PacWest (PACW) tumbled 42% at the market open before being halted for volatility after Bloomberg reported the company has been “weighing a range of strategic options.” Other regional banks followed PacWest lower, with Western Alliance (WAL) falling as much as 15% while Zions (ZION) slipped nearly 5%. The moves downward began just hours after Federal Reserve Chair Jerome Powell said JPMorgan’s purchase of First Republic on Monday was “an important step toward drawing a line under that period of severe stress." The stock declines underscore a disconnect between gloomy investor sentiment surrounding regional banks and the optimism that the crisis is over expressed by big names in Washington and on Wall Street. On Wednesday, Powell and the Fed raised interest rates to their highest levels since 2007, continuing an aggressive rate hike path that has contributed to the credit stress in the financial system. In his subsequent press conference, Powell's remarks indicated what some economists described as a “hawkish pause,” likely in June. “Should regional bank stress stabilize, labor markets stay tight, and inflation stay elevated, a rate hike in June could become appropriate,” BofA U.S. Economist Michael Gapen wrote in a note Wednesday. Shares of First Horizon (FHN) also slumped 38% at the open, its largest drop since September 2008, as Toronto Dominion Bank (TD) and First Horizon called off their potential merger due to regulatory hurdles. Shares of TD rose more than 2% on the news. More corporate earnings are set to flow in on Thursday. Fifty-one S&P 500 companies, accounting for 12% of the index’s market cap, are scheduled to report earnings, per Evercore ISI. Paramount Global (PARA) stock sank more than 20% as the company reported weaker-than-expected quarterly results and announced a dividend cut. The company reported a direct-to-consumer loss of $511 million in the first quarter compared to a loss of $456 million in the prior year period. Peloton (PTON) shares also traded lower, falling roughly 15%, as the company warned hardware sales are likely to decline next quarter. Meanwhile, Shopify (SHOP) stock rose more than 20% after selling its logistics business to Flexport. Apple, Shopify (SHOP), Block (SQ), Coinbase (COIN), DraftKings (DKNG), and Lyft (LYFT) are set to report after the market close. Oil futures were near the flatline on Thursday after falling nearly 10% over the last five days. West Texas Intermediate (CL=F) and Brent (BZ=F) rose slightly in early trading. Brent Crude prices sat just under $73 a barrel. On the economic front, weekly initial jobless claims exceeded expectations. The report said 242,000 jobless claims were filed, an increase of 12,000 from the week prior. Economists surveyed by Bloomberg had been expecting 240,000 claims. The April Jobs report is expected to provide a further look at the labor market on Friday." MY COMMENT The ONLY event of the day today is the APPLE earnings. They are the last of the traditional big cap tech companies to report. SORRY......I dont care at all about the bank story. When was the last time anyone walked into a bank lobby? When was the last time you even wrote a check? When was the last time you walked into a bank to talk about a loan? I am not even sure all the little and regional banks even have any relevance anymore.Banks come and go. The current short seller driven crises will not make any difference to the economy or anything else. it is just NOISE.......loud short term NOISE. The vast majority of the American public will not be impacted in the slightest.....no matter how many regional or local banks are driven out of business. It will end up being nothing more than a rearranging of the chairs in the banking industry.
I like this little article. Loews CEO James Tisch uses a famous Warren Buffett quote to explain the banking fiasco - and warns more lenders may get into trouble. https://finance.yahoo.com/news/loews-ceo-james-tisch-uses-200349600.html (BOLD is my opinion OR what I consider important content) "Loews CEO James Tisch employed one of Warren Buffett's favorite maxims to describe what happened during the recent banking fiasco. He also praised regulators for acting swiftly to stop the bank failures from escalating into a financial crisis, but warned there could still be more collapses to come. "As Warren Buffett says, 'When the tide goes out, you see who was swimming without a bathing suit,'" Tisch said. He spoke during his insurance, natural-gas logistics, and hotel company's earnings call this week, according to a transcript provided by AlphaSense/Sentieo. Buffett — the billionaire investor who runs Berkshire Hathaway — was asked about the banking debacle during a recent interview and replied with a twist to his famous saying. "We actually ran into a nudist colony here, in terms of banks all over doing that sort of thing," Buffett said. Silicon Valley Bank and Signature Bank ran into trouble earlier this year because they had an unusually large percentage of uninsured deposits, and invested heavily in long-dated bonds that slumped in price as interest rates climbed over the past year or so. Their customers grew worried about the safety of their money and withdrew it in droves, forcing the Federal Deposit Insurance Corp. to seize both lenders and guarantee all of their deposits. First Republic also saw more than $100 billion of deposit outflows in the first quarter, and was acquired by JPMorgan this week. The bank turmoil in early March was a "calamity" that raised the terrifying prospect of a sweeping run on American banks, Tisch said. If authorities hadn't intervened, they risked a "full-fledged banking catastrophe" and a "massive, uncontrolled bank scare" with huge repercussions, he continued. "It would have been the equivalent of a neutron bomb hitting the economy," he said. "The best way to stop a bank run — as well as a brush fire and a riot — is not to let it get started in the first place." However, Tisch warned of more trouble ahead. Regulators still haven't guaranteed bank deposits beyond the FDIC's $250,000 limit, he noted, meaning smaller lenders remain at a competitive disadvantage to peers that are "too big to fail." "I wouldn't be surprised if other flare-ups appear in the coming months," he said. In response to inflation hitting a 40-year high last year, the Fed has hiked interest rates from nearly zero to about 5% within the past 14 months. Those increases have allowed banks to charge more interest on loans. But they've also eroded the value of their bond portfolios, boosted the risk of default in their loan books, and hit asset prices in key sectors they lend to including commercial real estate. Higher rates also encourage saving over spending, and increase borrowing costs for consumers and businesses more broadly, raising the risk of an economic slowdown or recession. There are already signs the economy is slowing, Tisch said. He also emphasized that rate hikes have a delayed impact, and flagged the risk of a credit crunch if lenders balk at making loans given their deteriorating finances and the risk of further bank runs. As a result, Tisch called on the Fed to halt its rate hikes for three months. A prolonged pause would give the central bank time to assess a slew of economic data, and properly gauge the threat posed by inflation." MY COMMENT When it comes to business I am extremely CLINICAL. If you deserve to go out of business.....that is your problem. If you do not anticipate conditions years into the future and manage your business properly.........well, you are going to go out of business. It is a waste of money and effort to try to prop-up a bad or failing business. Banks that can not survive the current conditions.....should simply not be in business. The strong survive....the weak fail. In banking we probably have way too many regional and local banks....anyway. I am sorry.....but I have no sympathy or positivity for banks. I also DO NOT accept that what is going on right now is a......"CRISES". It is certainly a MEDIA FRENZY......it is certainly a short sellers dream. BUT.....as an investor.......it is not something that I care about.
I will admit that my opinions about the banks is colored by my BIAS. When I was in business I funded my business with personal assets for my entire 22 years as a business owner. Early on when I tried to work with a local or regional bank for business purposes.......it was a total joke. They were impossible to work with. So I just avoided them all-together. It was obvious that the banks that I had contact with over the years were poorly managed and incompetent. Many of the local banks in my area were in business to try to build up the number of their branches and assets in order to sell out to one of the big banks and create a big windfall for the initial investors. I knew a number of bank investors that made their money starting new banks and building them up to sell.
You know......as a long term investor I simply keep my focus totally on the long term. The short term economy, markets, and business are interesting and I discuss them daily on here.....but.....that is just a distraction from what is really important to me.....long term investing results. The most important thing I can do as an investor is.....mentally and emotionally...... SCREEN OUT all the short term BS. If you think all the short term.....drama, fear mongering, blather, doom & gloom, etc, etc, etc.....is bad now....just wait. Ten or twenty years from now it will be MUCH WORSE. Enjoy the daily Soap Opera.....but NEVER lose your long term focus.
As I just was logging in to my accounts....I expected that I might have a perfect ten stocks DOWN today. But no.....I did have three that were bucking the trend and were UP....AMZN, MSFT, and TSLA.
I have three shows coming up over the next three days. Than on Sunday we will do our little 700 mile road trip to "X" city where we will spend three days touring out from there to various locations. Next Thursday we will do the 700 mile drive back. We will than have Friday off and will do a show on Saturday. All in........we will cover about 2000 miles. I have to pack and get my stuff ready tomorrow. SO.......no guarantees how much I will post over the next three days. I also anticipate that I will NOT be posting over Monday through Thursday next week. Of course....my account will NOT miss me. It will simply soldier on by itself with no help needed from me....as usual. As to this thread......it will be in the good hands of Smokie, Zukodany, Emmett, and all the rest of you intrepid investors for the time that I am out of touch. MAKE ME SOME MONEY....while I am gone next week.
Of course I agree. Obviously, there is a market out there for all of the noise and such, otherwise it wouldn't be so prevalent. Creating a simple plan one can stick with and manage is relatively easy to do and profitable in the long run. One has to commit to it though and remain disciplined. A little bit of personal management and oversight, then just let it work for you. The day to day stuff is but a pebble dropped in a vast ocean over a long term plan.
Looks like the Ten Year Treasury yield is still down in the dumps......3.352%. This yield is pretty amazing with the FED having just completed TEN rate hikes in the past year. That average yield has been higher than the current rate for about 40 of the last 54 years......basically about every year going back before 2010.
This is an interesting little story. Exclusive-U.S. officials assessing possible 'manipulation' on banking shares - source https://finance.yahoo.com/news/exclusive-u-officials-assessing-possible-181840774.html (BOLD is my opinion OR what I consider important content) "NEW YORK (Reuters) -U.S. federal and state officials are assessing the possibility of "market manipulation" behind big moves in banking share prices in recent days, a source familiar with the matter said on Thursday, as the White House vowed to monitor "short-selling pressures on healthy banks." Shares of regional banks resumed their slide this week after the collapse of First Republic Bank, the third U.S. mid-sized lender to fail in two months. Short sellers raked in $378.9 million in paper profits on Thursday alone from betting against certain regional banks, according to analytics firm Ortex. Increased short-selling activity and volatility in shares have drawn increasing scrutiny by federal and state officials and regulators in recent days, given strong fundamentals in the sector and sufficient capital levels, said the source, who was not authorized to speak publicly. "State and federal regulators and officials are increasingly attentive to the possibility of market manipulation regarding banking equities," the source said. Whit House press secretary Karine Jean-Pierre said the Biden administration was closely watching on the situation. "The administration is going to closely monitor the market developments, including the short-selling pressures on healthy banks. I would have to refer you to the SEC on any possible actions," Jean-Pierre told a White House briefing. U.S. Securities and Exchange Commission Chair Gary Gensler on Thursday said the agency would go after any form of misconduct that might threaten investors or markets. "As I’ve said, in times of increased volatility and uncertainty, the SEC is particularly focused on identifying and prosecuting any form of misconduct that might threaten investors, capital formation, or the markets more broadly,” he said in a written statement. PacWest Bancorp shares slumped more than 40% on Thursday, dragging down other regional lenders, after the Los Angeles-based bank said it was in talks about strategic options. Western Alliance Bancorp denied a report from the Financial Times that said it was exploring a potential sale, and said it was exploring legal options. The report had sent the lender's shares down as much as 60% before they pared losses to trade about 35% lower. Share price swings did not reflect the fact that many regional banks outperformed on first quarter earnings and had sound fundamentals, including stable deposits, sufficient capital, and decreased uninsured deposits, the source said. "This week we have seen that regional banks remain well- capitalized," the source said. Short selling, in which investors sell borrowed securities and aim to buy these back at a lower price to pocket the difference, is not illegal and considered part of a healthy market. But manipulating stock prices, which the SEC has defined as the 'intentional or willful conduct designed to deceive or defraud investors by controlling or artificially affecting" stock prices, is. The increased short-selling activity has triggered some calls for a temporary ban, but an SEC official told Reuters on Wednesday the agency was "not currently contemplating" such a move. The SEC first warned investors in March, during a previous period of high market volatility surrounding the collapse of Silicon Valley Bank and Signature Bank, that it was carefully monitoring market stability and would prosecute any form of misconduct. MY COMMENT Very vague.....but if true....I would not be surprised. I am sure there are all sorts of insider rumors being floated to allies in the press.
As to APPLE: Apple reports ‘better than expected’ quarter driven by iPhone sales https://www.cnbc.com/2023/05/04/apple-aapl-earnings-report-q2-2023.html (BOLD is my opinion OR what I consider important content) "Key Points Apple reported second-fiscal quarter earnings on Thursday that beat Wall Street’s soft expectations for sales and revenue, driven by stronger-than-anticipated iPhones sales. However, Apple’s overall sales fell for the second quarter in a row. “It was quite a good quarter from an iPhone point of view, particularly relative to the market when you look at the market stats,” Cook told CNBC’s Steve Kovach. Apple reported second-fiscal quarter earnings on Thursday that beat Wall Street’s soft expectations for sales and revenue, driven by stronger-than-anticipated iPhones sales. Apple CEO Tim Cook told CNBC that the quarter was “better than we expected.” However, Apple’s overall sales fell for the second quarter in a row. Here’s how the company did versus Wall Street expectations per Refinitiv consensus expectations: EPS: $1.52 vs. $1.43 expected Revenue: $94.84 billion vs. $92.96 billion expected Gross margin: 44.3% vs. 44.1% expected Apple reported $24.16 billion in net income during the quarter versus $25.01 billion last year. Here’s how Apple’s individual product lines did versus StreetAccount consensus expectations: iPhone revenue: $51.33 billion vs. $48.84 billion expected Mac revenue: $7.17 billion vs. $7.80 billion expected iPad revenue: $6.67 billion vs. $6.69 billion expected Other Products revenue: $8.76 billion vs. $8.43 billion expected Services revenue: $20.91 billion vs. $20.97 billion expected Apple didn’t provide formal guidance, continuing its practice that dates back to 2020 and the start of the Covid-19 pandemic. Management typically provides some data points on a call with analysts. The highlight of Apple’s report was iPhone sales, which grew from the year-ago quarter even as the broader smartphone industry contracted nearly 15% during the same time, according to an IDC estimate. IPhone revenue grew 2% during the quarter, suggesting that parts shortages and supply chain issues that had hampered the product for the last few years, including an iPhone factory shutdown late last year, had finally abated. “It was quite a good quarter from an iPhone point of view, particularly relative to the market when you look at the market stats,” Cook told CNBC’s Steve Kovach. Apple’s Mac and iPad businesses didn’t fare as well. The company warned last quarter that both business segments would decline, partially due to parts shortages, but they decreased more than expectations. Apple’s Mac business fell more than 31% to just over $7.17 billion. But it’s a difficult comparison versus the same time last year when Apple was still benefiting from the end of a pandemic boom in PC sales and a shift to its own chips that offer longer laptop battery life. “There’s really two reasons for that,” Cook said. “One is the macro situation in general. And the other is where we’re still comparing to the very difficult compare of the M1 MacBook Pro 14 and 16-inch from the year-ago quarter.” Revenue from iPads declined nearly 13% to $6.67 billion. Apple’s Services business includes monthly subscriptions, revenue from Apple’s App Store, warranties, and search licensing revenue from companies like Google. Apple reported $20.9 billion in services revenue, a 5.45% annual increase, showing that the company’s most highest-margin line of business continues to grow. Apple’s wearables division, including Apple Watch and headphones such as AirPods, dropped 1% during the quarter, beating analyst expectations. Last fall, Apple released a more expensive Apple Watch, called Ultra. Apple’s greater China business, which includes Taiwan and Hong Kong in addition to the mainland, reported $17.81 billion in sales, down from last year’s $18.34 billion. Analysts had hoped that China’s demand for electronics would rise this year as the company exits out of Covid-era lockdowns and other restrictions. While sales shrunk in most regions that Apple monitors, they grew in its Asia Pacific region, which includes India. Cook visited India last month to open Apple stores and meet with politicians. “The switcher and first-time buyer metrics look very good there for India,” Cook said. Apple uses the term “switcher” to refer to first-time iPhone buyers who previously had Android devices. As expected, Apple’s board authorized $90 billion in share repurchases and dividends. Apple said it paid $23 billion in buybacks and dividends in the March quarter. Apple also raised its dividend 4% to 24 cents per share. Cook also said that Apple was not planning layoffs like those that other big tech companies have started over the past year. “I view that as a last resort and, so, mass layoffs is not something that we’re talking about at this moment,” Cook said." MY COMMENT YES......a BEAT. Although there is some ammunition here for the doom and gloomers to use to drive the stock down tomorrow if they choose. Much of the opinion.....so called "news".....that I have seen today has been pushing the negative scenario. WRONG AGAIN.......BUMMER for them.
@WXYZ You were right once again. You have been a great help to me. I have to salute you for this truly public service you do here. Many thanks W!
In case anyone gives a hoot about more numbers or another report. A short piece of it below. Jobs report: April job reports shocks with 253,000 jobs created, unemployment falls (Yahoo Finance) Here are the key numbers from the report compared to estimates from Bloomberg: Nonfarm payrolls: +253,000 vs. +185,000 expected Unemployment rate: 3.4% vs. 3.6% expected Average hourly earnings, month-on-month: +0.5% vs. +0.3% expected Average hourly earnings, year-on-year: +4.4% vs. +4.2% expected Average weekly hours worked: 34.4 vs. 34.4 expected
Another little article that I like. A Less-Obvious Lesson in Widespread Deposit Worries https://www.fisherinvestments.com/e...sobvious-lesson-in-widespread-deposit-worries (BOLD is my opinion OR what I consider important content) "They could be a call to reconsider how much cash you carry in your asset mix. With regional banks back in the spotlight this week after First Republic’s FDIC-brokered sale, bank health is once again top of mind. Yesterday, a Gallup poll revealed nearly half of Americans are worried about the safety of their bank deposits. This is a very curious snapshot of sentiment, considering the FDIC’s report on potential deposit insurance reform, released Monday, revealed a whopping 99% of US bank deposits are under its normal $250,000 insurance limit. So clearly there is a disconnect between sentiment and reality if only about 1 out of 100 bank deposits are uninsured while nearly half of Americans think their savings are vulnerable.[ii] Perhaps that is because people aren’t aware of FDIC insurance caps or how that program works. Whatever the reason, it seems pretty clear people are concerned about protecting their large deposits. And if you have more than $250,000 stashed away, perhaps that is important. But we also think that should raise a question: Why have so much cash stashed away in the first place? In our view, that can be a long-term drag on returns, making the current bank saga a call to reconsider whether your asset mix really matches your goals. For most people, $250,000 is an awful lot of money to keep in the bank. For those who are close to buying a house and need their down payment to be liquid, we get it (although we might suggest money market funds are a better place to park it). For businesses that need cash to make payroll, sure. But beyond that, we think most people carrying over $250,000 in cash might benefit from taking a hard look at their goals and needs and whether they are positioned optimally to reach them. Everyone’s situation is different, but if you will allow some generalizations, a cash cushion’s primary purpose is to cover near-term and potential emergency expenses. It is probably wise to have about 3 to 12 months’ worth of spending needs available on demand as a guard against job loss, unexpected home maintenance needs or—if you are relying on your investment portfolio to support cash flows—stock market volatility, so that you reduce the likelihood of selling during a down market. So whatever you pay for your mortgage or rent plus food, utilities, gas, tuition and other essentials, multiply the total by however many months of buffer you need, and squirrel it away. If you are retired and collect Social Security or have other pension income, deduct it. But for investors whose time horizons, goals and needs are commensurate with equity-like returns, cash holdings exceeding that mark—that aren’t earmarked for a big near-term expense—could be excessive. That is true whether your deposit balances top FDIC limits or not. If that is you, ask yourself why you are holding this much cash. In the wake of a disappointing 2022, we think quite a few folks do so thinking they will keep some “dry powder” to put to work in the stock market when conditions look better. But here is the thing: Early bull markets, which the rally since October increasingly looks like to us, basically never look like sanguine times to invest, as we discussed earlier this week. Said differently, there isn’t ever an all-clear signal trumpeting “New Bull Market!” when they begin. So, in the absence of a material reason to be bearish—in our view, a major negative shock few consider—equity investors should default to being bullish. So if your goal is to achieve market-like returns over time and stocks are in a bull market, we think the best time to invest will almost always be “now.” Short-term volatility is impossible to time, and waiting for the perfect entry point usually means sitting on the sidelines while stocks rise. Not only do you miss those returns in real time, but you miss the opportunity for them to compound over your entire time horizon. That snowball effect can add up. The biggest risk those with outsized deposit balances face today isn’t bank failures—there are ways to mitigate that, as we showed a few weeks back. Rather, the risk is limiting your return potential and making it harder to reach your goals. So if you find yourself worrying about the safety of large, uninsured bank deposits, by all means, do whatever homework you think necessary on that front to get your ducks in a row. But also think carefully and objectively about whether your cash is working against your long-term goals by limiting your total return potential. And that is true whether your deposits top $250,000 or not." MY COMMENT This disconnect shows the FALLACY of sentiment based indicators. They often reflect irrational behavior and/or thinking. These types of polls.....often sensationalized in the media.....are meaningless. With the current 24/7.........rampant media coverage of everything.......and the internet.....this sort of indicator as somehow being meaningful for investors......is simply a bad JOKE on anyone that considers this sort of BALONEY as an investor.
