The Long Term Investor

Discussion in 'Investing' started by WXYZ, Oct 2, 2018.

  1. WXYZ

    WXYZ Well-Known Member

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    Well......I got a new high on my account today.....and....looks like the old SP500 also hit an all time high. A....bumbling and stumbling market....but we slowly move higher. The market it clearly saying....."I want to take you higher".

    S&P 500 closes at all-time high as long-term inflation jitters fade

    https://finance.yahoo.com/news/futures-hold-steady-ahead-inflation-111940251.html

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

    "Wall Street stocks ended higher on Thursday, with the S&P 500 closing above its prior record high set on May 7, as economic data appeared to support the Federal Reserve's assertion that the current wave of heightened inflation will be temporary.

    All three major U.S. stock indexes advanced, with market-leading megacap stocks putting the Nasdaq out front. But economically sensitive transports and smallcaps ended the session in negative territory.

    The Labor Department's consumer price index (CPI) data came in above consensus and added fodder to the debate over whether current price spikes could transform into long-term inflation, despite the Fed's assurances to the contrary.

    But a closer look showed that much of the price surge came from items such as commodities and airfares, and is therefore likely to be temporary.

    "Earlier this week we had extremely boring market days as we all had our eyes on the bullseye of this CPI report," said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina. "But once people looked under the surface, the majority of the higher inflation is due to the reopening, and stocks had a relief rally."

    "The market is taking it in stride as it realizes the whole economy isn't overheating," Detrick added.

    A U.S. House of Representatives committee passed a $547 billion infrastructure spending bill targeting surface transportation, adopting some of President Joe Biden's proposals as part of his broader $2.3 trillion infrastructure package.

    Still, sectors that stand to benefit from infrastructure spending ended the session lower. Industrials and transports fell by 0.5% and 0.7%, respectively.

    The Dow Jones Industrial Average rose 19.1 points, or 0.06%, to 34,466.24; the S&P 500 gained 19.63 points, or 0.47%, at 4,239.18; and the Nasdaq Composite added 108.58 points, or 0.78%, at 14,020.33.

    Among the 11 major sectors of the S&P 500, healthcare enjoyed the largest percentage gains.

    But interest rate-sensitive financials fell the most, dropping 1.1% as easing U.S. Treasury yields weighed on the sector.

    GameStop Corp, the stock most closely associated with the social media-driven "meme stock" phenomenon, dropped 27.2% after the videogame retailer said it may sell new shares.

    Other stocks that have benefited from the retail short-squeeze rally, including Clover Health Investments Corp, AMC Entertainment Holdings, Bed Bath & Beyond Inc and GEO Group, also slid, losing between 8% and 19%.

    Pfizer Inc advanced 2.2% on news that the United States would pay the drugmaker about $3.5 billion for 500 million COVID-19 vaccine doses that it intends to donate to the 100 lowest income countries.

    Advancing issues outnumbered decliners on the NYSE by a 1.25-to-1 ratio; on Nasdaq, a 1.13-to-1 ratio favored advancers.

    The S&P 500 posted 58 new 52-week highs and no new lows; the Nasdaq Composite recorded 102 new highs and 14 new lows.

    Volume on U.S. exchanges was 10.64 billion shares, compared with the 10.67 billion average over the last 20 trading days."

    MY COMMENT

    We will....probably.....continue to be in a range bound market for the near future.....with some bumps up here and there.

    The comments in this little article are some of the more FIRM comments that I have seen lately about the fact that we are......NOT....likely to have an inflation problem. My view remains the SAME......yes.....there is NO inflation.

    I will say we are not totally out of the wood yet. There is still MUCH DISRUPTION of the labor and employment markets. The one thing that I believe......."could".....not "probably will".....cause bad inflation would be a wage/price spiral. We are not seeing this at the moment...but....with the screwed up labor and employment situation....who knows how it will all sort out over time. We should be pretty well re-opened by year end.....so that will be when all this "stuff" is near an end.

    Hopefully......the recognition of reality and non-reaction to the CPI numbers....will lead the markets to a BIG RALLY tomorrow to end the week.
     
  2. WXYZ

    WXYZ Well-Known Member

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    HERE is a little MOTIVATION for the markets tomorrow.......not that SLY was the best role model for money management.



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

    Lyrics

    "Hey, hey, hey, hey
    Beat is gettin' stronger
    Music gettin' longer, too
    Music is a-flashin' me

    I want to, I want to, I want to take you higher
    I wanna take you higher
    Baby, baby, baby, light my fire
    I wanna take you higher

    Boom laka-laka-laka, Boom laka-lak-goon-ka boom
    Hey, hey, hey, hey

    Beat is nitty-gritty
    Sound is in your city, too
    Music's still flashin' me

    Don't ya, don't ya, don't, don't, don't ya wanna get higher?
    Don't ya wanna get higher?
    Baby, baby, baby, light my fire (Woo)
    I wanna take you higher

    Boom laka-laka-laka, Boom laka-lak-goon-ka boom
    Hey, hey, hey, hey
    Boom laka-laka-laka, Boom laka-lak-goon-ka boom

    Higher
    Higher
    Higher
    Higher
    Higher (Won't ya light my fire?)
    Higher (Woo, yeah)
    Higher (Wanna take you higher)
    Higher
    Hey, hey, hey, hey

    Beat is there to make you move
    Sound is there to help you groove
    Music's still flashin' me
    Take your places

    I wanna take you higher (Higher)
    Wanna take you higher
    Baby, baby, baby, light my fire (Woo)
    I wanna take you high, high, high, high, high, high, high, high

    Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom

    Wanna take you, do you wanna go
    Wanna take my fire
    Wanna take you higher

    Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom, Boom laka-laka-laka, Boom laka-lak-goon-ka boom
    (Higher)

    Don't ya wanna get higher?
    I wanna take you higher
    Hey, hey, hey, hey
    Boom laka-laka-laka, Boom laka-lak-goon-ka boom
    I wanna take you higher
    I wanna take you higher
    Boom laka-laka-laka, Boom laka-lak-goon-ka boom
    Everybody higher, higher, higher"
     
    #6162 WXYZ, Jun 10, 2021 at 11:16 PM
    Last edited: Jun 10, 2021 at 11:25 PM
    duckleberry_fin likes this.
  3. andyvds

    andyvds Active Member

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    "You know that it would be untrue
    You know that I would be a liar
    If I was to say to you
    S&P couldn't get much higher"...
     
    oldmanram and TomB16 like this.
  4. WXYZ

    WXYZ Well-Known Member

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    I dont know why the financial media has gotten the idea....lately....that inflation is BAD for stocks and investors. That has...NOT...been my experience over a lifetime of investing....45+ years.

    Look at this graph: Morning Brief

    https://finance.yahoo.com/news/stoc...d-fed-rate-hikes-morning-brief-100310094.html

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

    "Even amid Fed rate hikes, stocks usually go up

    Rampant inflation in an overheating economy is bad. And so to fight that or prevent that, the Federal Reserve is expected to tighten monetary policy via the tapering of its quantitative easing program and the hiking of its fed funds rate.

    Currently, employment is rising and the prices of goods and services are climbing. But it's hard to argue that the economy is overheating with employment still 7.6 million jobs below pre-pandemic levels. And it's hard to argue that inflation is rampant as the increase in prices largely appears to be related "transitory" factors like base effects, reopening quirks, and some unusual short-term supply chain bottlenecks.

    Nevertheless, with the consumer price index (CPI) jumping a hotter-than-expected 5.0% year-over-year in May — the biggest jump since August 2008 — it's worth exploring what tighter monetary policy could mean for investors.

    Credit Suisse's Jonathan Golub did just that earlier this week, and he found that tighter policy isn't obviously bad for stocks as investors might expect.

    "While investors might interpret the reversal of Fed policy as a bad omen, history shows that stock returns remain robust in the months leading up to and following the first rate hike," Golub said in a note to clients on Wednesday. "More specifically, over the past four rate hike cycles (’94, ’99, ’04, ’15) the S&P 500 gained 9.5% in the 12 months prior to the first hike, and 26.0% over the subsequent three years."

    [​IMG]
    Stocks tend to go up. (Credit Suisse)
    "The real damage from higher rates tends to occur later in the cycle when tighter policy flattens/inverts the curve," he added. "We are eons away from that happening."

    Now, we'll acknowledge that the average Golub computed is arguably an oversimplification and that four rate hike cycles is a pretty small sample size.

    And when you consider all the other variables in the market, you could also argue that what we're experiencing today is totally unprecedented. And so, the past won't help outline the future.

    But we can't help but appreciate the "stocks usually go up" energy emanating from Golub's chart. And to that, we'd make two points.

    First, everyone is already talking about the risk of inflation heating up. And so the downside of tighter monetary policy amid rising prices is an event that may already be priced into the market.

    Second, businesses can be very flexible in the pursuit to grow profits. This means that when they are confronted by challenges that threaten profit growth, they will make changes to their strategies or even outright overhaul their business models. This is something we learned throughout the coronavirus pandemic. Offices had employees working remotely. Restaurants ramped up their pickup and delivery options. TV personalities broadcast from their homes. And so on.

    All this speaks to the truth about the stock market. There are always major risks that'll have investors reluctant to put money in the market. And there are often unexpected shocks that'll come with big scary sell-offs. But even when things are still bad, stocks rally as investors look past the challenges and bet that consumers and businesses will figure out a way to make things better.

    In other words, it's never a given that stocks will fall."

    MY COMMENT

    I have invested through ALL the time periods on the above graph....as well as.....being continuously invested for the past 45+ years.....with the exception of January 2008 to March of 2009. Over that entire time......... my investments have done well during any time periods of........real/imagined........ inflation. In fact....I dont even remember inflation being a big....talking point issue....during any of those times. The ONLY time when inflation was a...talked about issue....in my entire lifetime was in the late 1970's to the early 1980's.

    Based on....being an actual investor.....I dont even consider that we had inflation after the early 1980's. From that time on the FED has tended to chase after.......NON-EXISTANT inflation......that did not even exist........and.....often the end result was causing a recession by raising rates when there....ACTUALLY....was no reason to do so.

    REGARDLESS......I count on the management of the businesses that I own to have the brains to deal with ANY economic issues. I ALSO count on management to have the brains to anticipate any economic issues.......and be prepared to operate and make money regardless of what is going on in the world.

    One problem with all the.....NEW ERA THINKING...that we now see in the financial media is....it is just an intentional or unintentional EXCUSE for being IGNORANT. There is no need to ACTUALLY know anything about financial history.......no need to do any research....no need to have any actual experience in what you are talking about. It is a SHAME...that....often lately we go through these......CRISES MOMENTS....with everyone worked into a TIZZY......and than later it turns out that NOTHING actually happened. Just in the short time this thread has been in existence.......there are many examples of this sort of IGNORANCE.
     
    #6164 WXYZ, Jun 11, 2021 at 8:55 AM
    Last edited: Jun 11, 2021 at 9:29 AM
    TomB16 likes this.
  5. WXYZ

    WXYZ Well-Known Member

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    Some good data that supports being a long term investor.....and.....the future for investors.

    Household net worth climbs to $136.9 trillion, thanks to big stock market gains

    https://www.cnbc.com/2021/06/10/hou...rillion-thanks-to-big-stock-market-gains.html

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

    "Key Points
    • Household net worth rose to $136.9 trillion in the first quarter, a 3.8% gain from the end of 2020.
    • The gain came amid a 7% increase in the S&P 500 that boosted equity wealth by $3.2 trillion.
    • Household debt totaled $16.9 trillion, growing at the fastest pace going back to 2006.

    The net worth of U.S. households climbed to new heights as 2021 began and the effects of the Covid-19 pandemic began to fade.

    Thanks largely to a surge in the stock market, the total balance sheet for households and nonprofits rose to $136.9 trillion in the first quarter, a 3.8% gain from the end of 2020, according to Federal Reserve data released Thursday

    Of that total, $3.2 trillion came from equity holdings, while $1 trillion was due to the continued escalation in real estate values. The S&P 500 gained 7% for the quarter as investors anticipated rising corporate earnings and accommodative fiscal and monetary policy while also placing speculative bets on so-called meme stocks.

    From a historical perspective, household net worth has nearly doubled from its level of a decade ago as the nation was still escaping the throes of the Great Recession.

    The increase left net worth as a share of disposable income at just under 700%, off the all-time high at the end of 2020 but still elevated in historical terms.

    Household debt totaled $16.9 trillion for the quarter, growing at 6.5% rate that was the fastest pace going back to 2006.


    The gain in household value came as the growth rate in total private and government debt slowed to 5.8% from 6.3% in the fourth quarter of 2020, and was much lower than in the first quarter of last year. That was when government spending pumped trillions into the economy and triggered debt growth at a 10.8% level, followed by a 25.6% increase in the second quarter.

    Federal government debt increased 6.5% in the first quarter, well below the 10.9% rate in the last three months of 2020 but still enough to push the total debt level to just below $28 trillion at the end of the quarter. State and local government debt rose at a 3.8% rate, compared with 1.6% in the previous quarter.

    After slowing considerably in the second half of 2020, business debt picked up again, rising at 4.4% pace."

    MY COMMENT

    Those that.....CHOOSE...to take charge of their future and provide for their family by saving and investing are the GUTS of the USA economy. It does NOT require a big income or high level job. It simply requires some level of sacrifice to save for the future....over immediate spending. For many people....this is achieved simply by contributing to a 401K. for others an IRA. No matter where you are in your life....or your income....some level of saving is possible. You dont have to start BIG....most people did not.....you simply have to do what you can on a regular basis. JUST DO IT......make the choice.
     
  6. WXYZ

    WXYZ Well-Known Member

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    AND....as we have seen lately......MUCH of the data and projections are.....yes....EXTREMELY POSITIVE.....contrary to the day to day commentary.

    New Retail Sales Forecast for 2021 Significantly Exceeds Earlier Prediction
    Sales now expected to top $4.44 trillion this year.

    https://www.globest.com/2021/06/11/...s-earlier-prediction/?slreturn=20210511092037

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

    "Retail sales are doing better than initially expected earlier in the year.

    The National Retail Federation has revised its annual forecast for 2021, projecting that retail sales will now grow between 10.5% and 13.5% to between $4.44 trillion to $4.56 trillion this year. In February, NRF projected that retail sales would grow 6.5%.

    By comparison, retail sales totaled $4.02 in 2020. Non-store and online channels accounted for $920 billion of purchases.

    “The initial forecast was made when there was still great uncertainty about consumer spending, vaccine distribution, virus infection rates and additional fiscal stimulus, prior to passage of the American Rescue Plan Act,” according to NRF.

    NRF expects non-store and online sales to rise between 18% and 23% to a range of $1.09 trillion to $1.13 trillion. Those numbers exclude automobile dealers, gasoline stations and restaurants.

    Helping drive sales will be GDP growth. NRF projects that to approach 7%, compared with the 4.4% and 5% forecasted earlier this year. During this quarter, the economy should hit pre-pandemic levels of output.

    We are seeing clear signs of a strong and resilient economy,” NRF Chief Economist Jack Kleinhenz said in a prepared statement. “Incoming data suggests that US economic activity continues to expand rapidly, and we have seen impressive growth. Most indicators point toward an energetic expansion over the upcoming months and through the remainder of the year.”

    Personal income has risen because of the sheer amount of both fiscal and monetary policy intervention, which has created an overabundance of purchasing power, according to Kleinhenz. With this rise in spending, he anticipates the fastest growth the US has experienced since 1984.

    The economy and consumer spending have proven to be much more resilient than initially forecasted,” NRF President and CEO Matthew Shay said in a prepared statement. “The combination of vaccine distribution, fiscal stimulus and private-sector ingenuity has put millions of Americans back to work.”

    Other sources are also showing a strengthening sales environment. The NPD Group said discretionary retail sales revenue in the US increased by 17% over the first half of the year and rose 18% over 2019 levels, suggesting that the uptick in consumer spending predicted by many experts post-pandemic is beginning to materialize.

    With the potential for a strong recovery, the stores that survived the pandemic should be prepared to grow.

    COVID forced some retailers to restructure their balance sheets. But, now, the retailers that made it to the other side have shown the resilience to stick around.

    “Now, you feel like there are fewer question marks because we’re on the other side,” John Hofmann, commercial production team leader for KeyBank told GlobeSt.com in an earlier interview. “If a retail center performed well in COVID and the retailers were strong in COVID, we feel good. We see less uncertainty in the retail sector than we did pre-COVID.”"

    MY COMMENT

    AS usual....the constant day to day NEGATIVITY...turns out to be WRONG. My prediction......even these numbers will fall short of the HISTORIC economy that we are going to see over the next 12-24 months.

    Yes....there will STILL be factors that hurt the economy......rising taxes and regulation....and other economic foolishness...plus...the NORMAL potential for black swan moments. BUT....there are normal events that we just.....DEAL WITH and MOVE ON.
     
  7. WXYZ

    WXYZ Well-Known Member

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    A simple little article...but...it does contain some truth for new investors as well as others.

    Selling Stocks on Inflation Fears? Financial Pros Wouldn’t

    https://finance.yahoo.com/news/selling-stocks-inflation-fears-financial-190347140.html

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

    "Inflation is one of those economic terms most of us know just enough about to be afraid of. We know it erodes our money over time, and that it arrives in the form of higher prices for everyday goods and services. Inflation fears can also lead to negative reactions in the stock market, such as the selloff in May. But according to experts, this may be the wrong reaction to inflation news.

    But first: What factors are driving these inflation fears? Plenty.

    “There are definitely inflationary signals, no doubt,” says Aleksandar Tomic, an economist and associate dean of strategy, innovation and technology at Boston College.

    In May, the consumer price index, which measures the average cost of goods around the country, saw a year-over-year increase of 5% — its largest jump since August 2008. This comes on the heels of April’s CPI numbers, which came in much higher than economists had predicted.

    “Everybody was thinking it would be 3.6%, which would have been significant given that we’re running around 2%,” Tomic says of April’s CPI report. “The numbers were significantly above expectations.”

    COVID-19 relief measures pumped cash into economies all over the world, Tomic says. Those relief measures gave consumers the power to buy at a time when supply was constrained by several factors, including pandemic-hobbled businesses, worker shortages and the Suez Canal blockage.

    And by May, there were even more signs of inflation. Bureau of Labor Statistics data showed job openings and the number of people quitting their jobs in April were both at their highest levels on record.

    “So there’s a lot of activity, a lot of searching for talent and a lot of confidence, which is why they’re quitting jobs,” Tomic says. “And sooner or later, the wages will start rising.”

    If April’s report started the discussion about impending inflation, it appears May’s report bolstered it even further.

    “This time, inflation is coming from all sides,” Tomic says.

    But here’s the kicker: Despite all this, long-term investors needn’t actually fear a surge in inflation — as long as they’ve set up a healthy investment portfolio.

    Why experts say you shouldn’t sell on inflation fears

    When there’s a whisper of rapid inflation, the market may react by selling. On May 12, when the Bureau of Labor Statistics released the surprisingly high consumer price index data, the S&P 500 saw its worst three-day drop in almost seven months. But why?

    The market always sells first and asks questions later,” says Tiffany Kent, a certified financial planner and portfolio manager of Wealth Engagement LLC in Atlanta.

    In this instance, she says the potential for higher inflation scared investors because when inflation rises, interest rates may rise too. And when interest rates rise, it’s possible that company profits could be negatively affected, which could cause their stock prices to drop.

    So traders decided to sell in the moment, then spend their time analyzing what it all meant later.

    Most individual investors — especially those new to the market — wouldn’t do well taking that same frenzied approach, Kent says. Unless you’re versed in the traditional ways of measuring how valuable a company is, such as analyzing its price-to-earnings ratio, you’re more or less trading on hope.

    And it’s hard to invest in or bet on a hope,” she says.

    The better option? Keep your money parked in stocks rather than selling in a panic or trying to time the market, says Matt Canine, a certified financial planner and senior wealth advisor with East Paces Group in Atlanta.

    Historically, stocks in general are the highest returning asset class and are the best hedge against inflation,” Canine says. “That’s one thing we want to impress on people. If you’re currently invested in the market, you’re probably going to be OK.”

    And if you’re a younger investor, this advice is especially pertinent, says John Pilkington, a certified financial planner and Vanguard wealth advisor executive in Charlotte, North Carolina.

    It’s possible a large uptick in inflation could drive a negative reaction in the markets, Pilkington says, but young investors have the most to gain by staying put.

    If you’re a long-term investor, stocks are still likely your best long-term response to inflation,” Pilkington says. “So I think you have to take a long view with your investment portfolio, and there’s really no group that’s better poised to do that than someone who is starting out in their 20s or 30s and putting away for retirement.”

    Whose investments could be impacted by inflation?

    Even after May's report, economists still aren’t sure if the higher prices we’ve seen this spring are a temporary blip or a sign of more sustained inflation. But if it’s the latter, Pilkington says, there’s one group (from an investment vantage point) that might be hit particularly hard: retirees on fixed incomes.

    To understand why, look at an example with bonds, a common fixed-income investment among retirees that pays the investor specified interest over time. Higher inflation means investment returns have less buying power, so the goal is for those returns to outpace inflation. If your bonds are paying 3% interest before inflation, and inflation is rising at 2%, your real return is 1%. However, if inflation is rising at 4%, you're getting a negative return, once adjusted for inflation. In other words, your money may be growing, but you're still losing buying power.

    So what’s a recent retiree to do if they sold a large portion of their stocks for any reason, perhaps converting them to inflation-sensitive bonds as part of their retirement plan, just as inflation fears ramp up?

    Kent says she’s had a lot of discussions with clients who are in that exact position. And even though she believes it may be a good option for them to get back into stocks, she says it can be hard to convince them of it. Stocks tend to be more volatile than fixed-income assets, and retirees often favor stability.

    But there are responsible ways to go about it, Kent says. Chief among them is a method that works for younger investors and retirees alike: dollar-cost averaging, in which you invest small amounts on a set schedule over a long period of time.

    “It’s a very logical approach to getting back into the market,” Kent says. “We know that we can’t time things perfectly.”

    Kent is currently recommending her clients spread their contributions out over two years if they recently sold their stocks but are getting back into the market.

    By investing small amounts over a long period rather than putting it all back in the market at once, Kent says, retirees can limit their risk due to market swings and have cash ready on the sidelines to buy in at low prices if there’s a downturn.

    The case for a financial plan

    Among financial planners, there’s a widely shared sentiment: Inflation, whether temporary or sustained, is a natural phenomenon that any good financial planner will account for.

    And according to Pilkington, it’s one of the three biggest drags on a portfolio’s performance, alongside expenses and taxes. So if you can build a portfolio that’s low-cost, tax-advantaged and highly diversified, that’s how you protect your returns from inflation, and how you keep the majority of your money over time — no matter what’s happening in the markets or
    broader economy."

    MY COMMENT

    I dont buy the inflation argument that is the....."set up"....early in the article......for the subsequent discussion. BUT...I am sure there are many many investors that are having real issues being invested in the last year or two. NOT...the people on this board....but average investors.

    Being a new.....or even an old investor......can be SCARY in light of all the constant information that is thrown out there in ALL the many media sources today. People faced with too much information or conflicting information....just shut down...and dont do anything. This.....INVESTOR PARALYSIS.....is a common problem for new or even older investors.

    My view on the best way to deal with this....simple broad Index Fund investing...using a buy and hold approach....with something like a SP500 Index fund. Take some set monthly amount and put it in every month. IGNORE all the news and other events.
     
    #6167 WXYZ, Jun 11, 2021 at 9:52 AM
    Last edited: Jun 11, 2021 at 10:05 AM
  8. WXYZ

    WXYZ Well-Known Member

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    Typical moderate open today. The averages are doing well....but not booming. Good enough for now.....we can build from here as the day goes on. OR.....not.

    Seems like a repeat of yesterday....lets pull for the day to end the same way as yesterday....for a good end to the week.

    SOMEONE....BUY SOMETHING.
     
  9. WXYZ

    WXYZ Well-Known Member

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    NVDIA is UP nicely today....about $17 at the moment. I decided to convert my recent buy (May 21, 2021) of 30 shares to leverage. So last Wednesday...June 9, 2021....I sold 26 of my 30 shares...keeping 4 shares as my profit. I put the sale proceeds back into the SP500 Index fund.....where they came from originally. I than......on the same day......bought 35 shares of Nvidia on margin.

    I will hold the margin shares....35 shares...till at least a day or two after the split. At that point I will cash in enough to pay off the margin balance and keep the balance of the shares as profit....and....long term shares. Hopefully.....assuming there is a profit. I imagine there will be....but.....there is STILL 5.5 weeks till the split. My goal is to keep at least 10 pre-split shares as profit.

    If I decide to hang onto ALL the shares.....I will pull some money out of the SP500 Index Fund....or.....my Fidelity Contra Fund to cover the margin.

    As usual....I will post whatever I happen to do.
     
  10. andyvds

    andyvds Active Member

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    This week I sold many stocks - most of them with some profits - and invested in ETF.

    40% of my stock is now ishare nasdaq100 ETF and vanguard S&P 500 ETF.
     
    WXYZ and oldmanram like this.
  11. WXYZ

    WXYZ Well-Known Member

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    Another very SOLID day today. I was in the green and got a good beat of the SP500 by 0.25%. A good end to the week.

    The averages had a good week also. All were positive for the week....except for the DOW. The SP500 has now moved ahead of the DOW for the year to date.

    DOW year to date +12.65%
    DOW for the week (-0.80%)

    SP500 year to date +13.08%
    SP500 for the week +0.41%

    NASDAQ 100 year to date +8.61%
    NASDAQ 100 for the week +1.65%

    NASDAQ year to date +9.16%
    NASDAQ for the week +1.85%

    RUSSELL year to date +18.28%
    RUSSELL for the week +2.16%

    Those are some GREAT returns for the un-managed averages for just short of 6 months.
     
  12. WXYZ

    WXYZ Well-Known Member

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    I am STILL suffering from the LAG in the tech stocks that I own for the year to date. But have made some nice headway. I had another all time account high today. My return to date is 9.3%. VERY satisfactory considering that my GOAL is to average 10% per year total return. BUT.....trailing the SP500 by 3.35% year to date. I was ahead of the SP500 earlier in the year till the BIG CAP TECH stocks decided to pull back. I will GLADLY take where I am for half way through the year at the end of this month.
     
  13. WXYZ

    WXYZ Well-Known Member

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    Here is how we ended the week.

    Stock market news live updates: S&P 500 ekes out record closing high as traders shake off inflation concerns

    https://finance.yahoo.com/news/stock-market-news-live-updates-june-11-2021-235234640.html

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

    "Stocks ended a choppy session higher, eking out a fresh record high on Friday as investors looked beyond a stronger-than-expected print on inflation.

    The S&P 500 set a new record closing high, topping its previous record level from Thursday. The Dow and Nasdaq also ended in positive territory. The 10-year yield dipped back below 1.5%.

    The Bureau of Labor Statistics reported on Thursday that its headline consumer price index rose by 5.0%, or by the most since 2008, in May. Core consumer prices, which exclude volatile food and energy prices, surged at the fastest rate since the 1990s, extending gains after an already strong April report.

    U.S. stocks reacted less negatively to the report than they had in April, however, with the S&P 500 jumping to a new record high.

    “The inflation outlook has rightfully been top of mind since last month’s blowout report,” LPL Financial Chief Market Strategist Ryan Detrick said in a note Thursday. “Under the hood, though, we think the picture is a bit more sanguine than the headlines would suggest, and still believe inflation will be relatively well-contained over the intermediate-to-long term.”

    Investors have taken into account recent commentary from Federal Reserve officials around inflation. Many have said they see price increases as only transitory jumps off last year's pandemic-depressed lows, and have telegraphed a willingness to tolerate a period of above-target – or above 2% – inflation following years of undershooting. Next week's Federal Reserve policy decision may help further reaffirm this stance, and solidify that the central bank still believes the economy has a ways to go in recovering from the pandemic before the Fed moves to adjust its pull back on its quantitative easing program or raise rates.

    "I think that investors may have had some concern that if inflation was too hot that there would be fears of Fed tightening and a real significant tightening of financial conditions and that would weigh on equities," Brian Levitt, Invesco global market strategist, told Yahoo Finance. "I would argue that it's a market that's saying, yea it's inflationary, it's not going to get out of hand. You may see some steps to normalize policy over time."

    "I think what we'll find as the year progresses is that growth is strong, there is some pricing pressure, but the Fed's going to let it run ... and cyclically, rates should move higher from here. That's not to say that rates are going to 2.5% or 3%," he added. "We're still going to be in a structurally low interest rate environment, probably for a lot of the rest of our careers if not the rest of our lives. But cyclically, I don't see why rates shouldn't move higher in an improving growth backdrop in which the Fed is telling us that they're not going to be raising short rates for a while." "

    itions of competitive threats by dominant platforms," among other measures. The legislation — which would still need to clear the Judiciary Committee, full House, Senate and President Joe Biden — comes following renewed scrutiny over the power wielded by these platforms, and whether previous mergers were completed as a move to thwart potential competitors.

    “Right now, unregulated tech monopolies have too much power over our economy," Antitrust Subcommittee Chair David Cicilline said in a statement. They are in a unique position to pick winners and losers, destroy small businesses, raise prices on consumers, and put folks out of work. Our agenda will level the playing field and ensure the wealthiest, most powerful tech monopolies play by the same rules as the rest of us.”

    MY COMMENT

    Another hard fought week. There was nothing of note this week...not even the CPI release which the markets IGNORED. We continue to add to year to date gains in stocks and funds and Indexes. Perhaps another 6 months to get past the initial part of the re-opening. This will get us past much of the lingering FEAR and DOUBT.
     
  14. WXYZ

    WXYZ Well-Known Member

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    I....SO.....agree with this little article.

    You Can’t Invest Without Trading. You Can Trade Without Investing.
    Understanding the difference between speculation and investing is essential to avoiding reckless risk

    https://www.wsj.com/articles/you-ca...g-you-can-trade-without-investing-11623426213

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

    "I’ve had it.

    The Wall Street Journal is wrong, and has remained wrong for decades, about one of the most basic distinctions in finance. And I can’t stand it anymore.

    If you buy a stock purely because it’s gone up a lot, without doing any research on it whatsoever, you are not—as the Journal and its editors bizarrely insist on calling you—an “investor.” If you buy a cryptocurrency because, hey, that sounds like fun, you aren’t an investor either.

    Whenever you buy any financial asset because you have a hunch or just for kicks, or because somebody famous is hyping the heck out of it or everybody else seems to be buying it too, you aren’t investing.

    You’re definitely a trader: someone who has just bought an asset. And you may be a speculator: someone who thinks other people will pay more for it than you did.

    Of course, some folks who buy meme stocks like GameStop Corp. GME 5.88% are investors. They read the companies’ financial statements, study the health of the underlying businesses and learn who else is betting on or against the shares. Likewise, many buyers of digital coins have put in the time and effort to understand how cryptocurrency works and how it could reshape finance.

    An investor relies on internal sources of return: earnings, income, growth in the value of assets. A speculator counts on external sources of return: primarily whether somebody else will pay more, regardless of fundamental value.

    The word investor comes from the Latin “investire,” to dress in or clothe oneself, surround or envelop. You would never wear clothes without knowing what color they are or what material they’re made of. Likewise, you can’t invest in an asset you know nothing about.

    Nevertheless, the Journal and its editors have long called almost everybody who buys just about anything an “investor.” On July 12, 1962, the Journal published a letter to the editor from Benjamin Graham, author of the classic books “Security Analysis” and “The Intelligent Investor.” That June, complained Graham, the Journal had run an article headlined “Many Small Investors Bet on Further Drops, Sell Odd Lots Short.”

    He wrote: “By what definition of ‘investment’ can one give the name ‘investors’ to small people who make bets on the stock market by selling odd lots short?” (To short an odd lot is to borrow and sell fewer than 100 shares in a wager that a stock will fall—an expensive and risky bet, then and now.)

    “If these people are investors,” asked Graham, “how should one define ‘speculation’ and ‘speculators’? Isn’t it possible that the current failure to distinguish between investment and speculation may do grave harm not only to individuals but to the whole financial community—as it did in the late 1920s?”

    Graham wasn’t a snob who thought that the markets should be the exclusive playground of the rich. He wrote “The Intelligent Investor” with the express purpose of helping less-wealthy people participate wisely in the stock market.

    In that book, after which this column is named, Graham said, “Outright speculation is neither illegal, immoral, nor (for most people) fattening to the pocketbook.”

    However, he warned, it creates three dangers: “(1) speculating when you think you are investing; (2) speculating seriously instead of as a pastime, when you lack proper knowledge and skill for it; and (3) risking more money in speculation than you can afford to lose.”

    Most investors speculate a bit every once in a while. Like a lottery ticket or an occasional visit to the racetrack or casino, a little is harmless fun. A lot isn’t.

    If you think you’re investing when you’re speculating, you’ll attribute even momentary success to skill even though luck is the likeliest explanation. That can lead you to take reckless risks.

    Take speculating too seriously, and it turns into an obsession and an addiction. You become incapable of accepting your losses or focusing on the future more than a few minutes ahead. Next thing you know, you’re throwing even more money onto the bonfire.

    I think calling traders and speculators “investors” shoves many newcomers farther down the slippery slope toward risks they shouldn’t take and losses they can’t afford. I fervently hope the Journal and its editors will finally stop using “investor” as the default term for anyone who makes a trade.

    “ ‘Investor’ has a long history in the English language as a catch-all term denoting people who commit capital with the expectation of a return, no matter how long or short, no matter how many or how few investing columns they read,” WSJ Financial Editor Charles Forelle said in response to my complaints. “Back at least to the mid-19th century, ‘invest’ has even been used to describe a wager on horses—an activity surely no less divorced from fundamental analysis than a purchase of dogecoin.”

    I hear you, Boss, but I still think you’re wrong. There’s no way the Journal would say a recreational gambler is “investing” at the racetrack just because a dictionary says we can.

    Calling novice speculators “investors” is one of the most powerful ways marketers fuel excessive trading.

    In a recent Instagram post, a former porn star who goes by the name Lana Rhoades posed in—well, mostly in—a bikini, as she held up what appears to be Graham’s “The Intelligent Investor.” According to IMDb.com, she starred in such videos as “Tushy” and “Make Me Meow.”

    In her post, which was “liked” by nearly 1.8 million people, Ms. Rhoades announced that she will be promoting a cryptocurrency called PAWGcoin.

    The currency’s website says the coin is meant for “those who pay homage to developed posteriors.” (PAWG, I’ve been reliably informed, stands for Phat Ass White Girl.)

    PAWGcoin is up roughly 900% since Ms. Rhoades began promoting it in early June, according to Poocoin.io, a website that tracks such digital currencies.

    Ms. Rhoades, who has tweeted “I also read the WSJ every morning,” couldn’t be reached for comment. PAWGcoin’s website encourages visitors to “invest now.”

    In Ms. Rhoades’s Instagram post, she is holding up an open copy of the “The Intelligent Investor,” whose cover is reversed. She appears to be reading it with her eyes closed."

    MY COMMENT

    A pet peeve of mine. The FAILURE to differentiate.....trading...speculating........investing......and gambling. ALL the BIG brokers......mine included......now use the term....."TRADING".....for investing. It drives me crazy. YES....buying a stock may be a "trade".....but....that act does not make you a "trader".

    I agree with this article and think the poor distinction between the above and failure to use TIGHT language for different types of financial behavior....is a slippery slope. I DO believe it leads people to take risk and actions that are far beyond what they understand......and....puts them at much more risk than the realize. I...ACTUALLY....believe this language choice is.....INTENTIONAL....on the part of the brokers and financial professionals.
     
    #6174 WXYZ, Jun 11, 2021 at 4:44 PM
    Last edited: Jun 11, 2021 at 9:36 PM
  15. Dax Martinez

    Dax Martinez Member

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    Wish the stock market was open 24/7 :yawn:

    I recently broke my ring finger, doctor gave me 3 weeks to heal. In the meantime I've been analyzing stocks.

    I started becoming more interested in options calls. I know its super risky. Anyways I'm a long term investor but I might use 5% of my income to take some risks I can afford.
     
  16. WXYZ

    WXYZ Well-Known Member

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    Wee have heard about the soaring lumber prices for months.....as a PROXY....for inflation. I rarely see anyone talking about the DROP in lumber futures. Here is a bit more on the....ACTUAL...current reality.

    Lumber Prices Post Biggest–Ever Weekly Drop With Buyers Balking

    https://finance.yahoo.com/news/lumber-prices-post-biggest-ever-210144368.html

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

    "Lumber futures posted their biggest-ever weekly loss, extending a tumble from all-time highs reached last month as sawmills ramp up output and buyers hold off on purchases.

    Prices in Chicago fell 18% this week, the biggest decline for most-active futures in records going back to 1986. Lumber has has now dropped almost 40% from the record high reached on May 10.

    Sawmills appear to be catching up with the rampant homebuilding demand in North America that fueled a months-long rally, bringing some relief to a market beset by supply shortages and price surges. Buyers are balking at still historically elevated prices and awaiting additional supplies, setting off a cascading sell-off, analysts said.

    “Activity yesterday was brisk to start, turned lethargic and ended quite subdued,” William Giguere, who buys and sells eastern spruce with mills for Sherwood Lumber in Massachusetts, said in a note Friday. “There was plenty of lumber available from the mills and enough ambition to sell. Missing was the sense of urgency from buyers.

    Many buyers only purchased if necessary, generally staying on the sidelines, CIBC analyst Hamir Patel said Friday, citing an assessment from Random Lengths. The closely watched trade publication reported further declines in several wood products that trade on the cash market, and pointed to an abundance of mill offerings, Patel said.

    U.S. lumber production has responded to the price rally by ramping up output by 5% over the past 12 months with another expected increase of 5%, or roughly 1 billion board feet, according to Domain Timber Advisors LLC, a subsidiary of Domain Capital Group, in Atlanta, Georgia.

    Resolute Forest Products Inc. is spending $50 million to increase its lumber production, the company said Thursday. West Fraser Timber Co., the world’s biggest producer, said recently that it’s expanding capacity at five U.S. mills, while rival Canfor Corp. has said it will invest around $160 million in a new sawmill in Louisiana.

    Above-Trend

    Still, while lumber prices may finally be pulling back from stratospheric highs, don’t look for a return to pre-pandemic levels any time soon, according to BMO Capital Markets.

    “‘Nosebleed’ prices won’t last, but strong demand, a limited supply response and a rising cost curve all point to above-trend prices for at least the next 12-24 months,” BMO analyst Mark Wilde said in a note.

    Lumber futures slid 5.6% in Chicago to $1,059.20 per 1,000 board feet on Friday. Prior to the rally that started in mid-2020, lumber futures traded mostly within the range of $200 to $600 since 1992.

    With strong U.S. home building expected to last for several years, lumber prices will likely remain above $500 per 1,000 board feet for the next five to eight years, said Scott Reaves, forest operations director at Domain Timber Advisors.

    We’re at a new normal,” Reaves said in a phone interview. “We’re going to see this sustained level of housing demand and a new normal for a pricing floor in lumber.”"

    My COMMENT

    This is how the economy works....supply, demand, and response from manufacturers to meet demand and sell products. This is the perfect example....WHY....any inflation will be transitory. As manufacturing ramps up from the pandemic and workers get back on-line.....there will be the usual, normal response to demand for products. This will IMPAIR the ability of manufacturers and retailers to ramp up pricing and gouge consumers. In the end it all BALANCES out.

    LUMBER prices ACTUALLY peaked about May 1....and.....have been drooping ever since. A classic example of the LAG in the media between REALITY and what is reported. On an anecdotal level....I STILL hear "normal" everyday people talking about the lumber prices with NO awareness of the drop in prices that has been happening since about the start of May.
     
    #6176 WXYZ, Jun 12, 2021 at 8:45 AM
    Last edited: Jun 12, 2021 at 9:17 AM
    Globetrotter likes this.
  17. WXYZ

    WXYZ Well-Known Member

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    Speaking about lumber....leads me to housing....local housing that is. My little neighborhood of 4200 homes seems to have settled into the PEAK SELLING SEASON. We now have 14 homes for sale. Four are over $1MILLION.....ten are below. The lowest priced home is $530,000.

    We are STILL seeing EXTREME activity and an EXTREME sellers market....but....the mania seems to be down by a TINY bit. In a typical week we will see about 15 homes active. As the week goes on the number will drop as low as 8 homes available and than as new homes come on the market we bounce back up to about fifteen homes again. We are seeing constant turnover due to homes selling. Prices remain STRONG but dont seem to be jumping upward as they were.....they seem to have stabilized.......at the new higher levels. Multiple and cash offers are STILL the norm.

    For those wanting to buy. I suspect that many areas of the country will see the MANIA dissipate in the Fall. Desirable areas will still be a problem for buyers....but...many local areas are going to see pricing and demand come back down to more normal levels as we go into fall and winter. the current level of activity is simply NOT sustainable in many areas that are not....PRIME DESIRABLE areas.
     
    Globetrotter likes this.
  18. WXYZ

    WXYZ Well-Known Member

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    AMAZING.....the Ten Year Treasury yield is......1.45%.

    As I type this I hear a financial "guy" on TV talking about inflation going way up for the next year and a half......perhaps.....all the way to to.......GASP.....3-4%.

    We have been in a DEFLATIONARY ENVIRONMENT for so long......12+ years......with the inflation rate WAY below what is healthy....that NORMAL inflation in the 3-4% range is now SHOCKING. GIVE ME A BREAK.....inflation in the 3-4% range is NOT abnormal and NOT dangerous. It simply will indicate a BOOMING ECONOMY. Stocks will flourish......and....earnings will be stellar. BUT....that does not mean ALL boats will be lifted. AS usual.....those that are saving and investing and working for their future will do well.
     
  19. WXYZ

    WXYZ Well-Known Member

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    I like this little article and the concept of PARENTS using the meme stock mania to teach their kids about investing.

    If GameStop has your kids interested in investing, here's what to do

    https://finance.yahoo.com/news/gamestop-kids-newly-interested-investing-174100992.html

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

    "The rise of meme stocks — shares in GameStop, AMC and a handful of other companies whose value has been driven through the roof thanks to the coordinated efforts of everyday investors — has been a mixed blessing.

    While they have shown just how easily the stock market can be manipulated, meme stocks have also made a lot of people a lot of money — in the short-term, anyway.

    But the meme stock phenomenon could have at least one long-lasting benefit: an increased interest in investing among American teenagers.

    A recent Wells Fargo survey found that 45% of teens are more interested in investing this year because of the wide-ranging attention GameStop has received since the company’s stock price exploded from $65.01 on Jan.22 to $347.51 on Jan. 27.

    You might have reservations about your children learning about investing through social media platforms like Reddit, but an early interest in financial literacy, no matter where it comes from, will serve them well throughout their lives.

    Here’s how you can help them build on what they've already learned online.

    The findings

    When asked where they get their information about finances, 57% of Wells Fargo’s teenage survey respondents said they learn about dollars and cents from their parents. But other sources of information, like school (47%), social media (35%) and online websites and articles (34%) are all having an influence.

    They’re also having more of an influence than parents are aware of. Only 12% of the parents surveyed for the study believe their kids use social media for their financial education.

    “There is a bit of a disconnection between parents’ and kids’ perceptions around financial education,” said Kathleen Malone, financial adviser with Wells Fargo Advisors in Charlotte, North Carolina. “It’s very important for families to discuss money — and for our next generation to understand how to handle their finances.”

    Assessing just how complete that understanding is is a little difficult. While 69% of teenagers said they are good with money, 49% would give their investment knowledge a grade of D or F. But there was consensus in one key area: 93% of teens agree that learning about investing now will help them be more financially stable in the future.

    So take heart, moms and dads. At least some of your kids are interested in becoming more financially literate. You can work with that.

    One way to make the stock market more relatable to young minds is by talking about it in relation to your kids’ favorite brands. Think video games, clothing and snack food.

    Some popular investing apps make this even easier by giving away free big-name stocks like Apple, Nike and Amazon.

    A teachable moment

    As a parent, allowing your kid to wander through social media for any length of time can be a nerve-wracking experience.

    But if they’re reading about markets and money, at least their interest is piqued by something that could help them for the rest of their lives. Think of this as the perfect opportunity to talk to your kids, not just about their finances, but about where they get their financial information and how to evaluate it.

    “Social media has a profound influence on our younger generations. Those generations grew up with social media and often trust many of the platforms more than their parents do,” says Mariana Martinez, family dynamics consultant with Wells Fargo’s Wealth & Investment Management group.

    It is vital to establish solid and open communication, create a shared purpose, and educate our children so that they are prepared for financial independence.”

    A lot of parents appear to be doing just that. Three in five parents surveyed by Wells Fargo say they have talked to their teenagers about handling finances. But only 32% have had much of a discussion about investing.

    It’s never too early to have that discussion, and it’s never too early for your kids to start investing their own money for their future.

    And don’t think they need a lot of money to get started. Modern technology makes it easy for you and your kids to set up a balanced portfolio and make regular, automatic contributions — even if they only invest some “spare change”, it will grow exponentially over the years.

    Start your child’s investment journey the right way

    If you’re wary of the information your child might scrape together (and potentially misinterpret) online, there's no shortage of ways to help them get their feet wet investing without being dragged feet-first into the swamp.

    Start with a financial literacy tool for kids — one that you and your children can learn from together.

    Most important, though, is that you encourage your kids' curiosity and interest in one of life's most important aspects. Earning, saving and investing money are all keys to a prosperous and rewarding life. The earlier they develop the skills, the happier they're likely to be later on."

    MY COMMENT

    A very GENERAL article.....but the main thing is....it raises a good and necessary topic for parents. Educating kids about money and investing and finances gives them critical skills going forward.
     
    Globetrotter likes this.
  20. WXYZ

    WXYZ Well-Known Member

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    This nice little article has a preview of next week.

    Fed decision, retail sales: What to know this week

    https://finance.yahoo.com/news/fed-decision-retail-sales-what-to-know-this-week-151132050.html

    "BOLD is my opinion OR what I consider inportant content)

    "One of the main focuses for investors this week will be on the Federal Reserve's June policy decision. The central bank's statement and press conference are set to help clarify the path forward for monetary policy as investors contemplate the staying power of higher inflation. A number of key economic data releases are also scheduled for this week, including May retail sales.

    The Fed's monetary policy decision and press conference from Fed Chair Jerome Powell will take place Wednesday afternoon. The focal points for investors will be around commentary about the strength of the economic recovery, and remarks that might suggest when the central bank will begin tapering its crisis-era asset purchase program. Currently, the Federal Reserve is conducting these purchases at a rate of $120 billion per month, with this quantitative easing having served as a key tool the Fed used to provide support and liquidity to the economy during the pandemic.

    Heading into the June meeting, a number of Fed officials suggested it may be time to at least begin discussing tapering. Federal Reserve Bank of Cleveland President Loretta Mester, Philadelphia Fed President Patrick Harker, and San Francisco Fed President Mary Daly have been among those saying the Fed could at least begin "talking about talking about" tapering, given signs of renewed economic activity.

    Others including Federal Reserve Bank of St. Louis President James Bullard, however, have held firm that the economy was "not quite there yet" to warrant serious discussions of policy changes. Powell, for his part, has made clear that central bankers would telegraph their intent to taper before actually beginning the process.

    Recent data have suggested the U.S. economy is inching toward the thresholds necessary to prompt the Federal Reserve to begin tapering, albeit with some distance still to go before triggering such a move.

    The May jobs report showed that more than half a million jobs came back last month and that the unemployment rate dipped to a new pandemic-era low. However, the economy is still more than 7 million jobs short of its February 2020 levels, and joblessness still remains elevated – offering the Fed justification for a still-accommodative tilt to monetary policy. The central bank has targeted reaching maximum employment and price stability, with some flexibility on the latter target to allow for a period of above-target inflation to compensate for years of undershooting.

    “The Fed needs to have flexibility. This is true in the past. And it is absolutely true right now. They are going to watch the data, watch the world unfold, and adjust,” Claudia Sahm, senior fellow at the Jain Family Institute and former Federal Reserve economist, told Yahoo Finance. “I think, at this point, markets are starting to figure out what the Fed's plan is. It's a new one. It has some risks attached to it. But they are going to bat for workers, because they have a dual mandate. And we are millions of jobs short.”

    On the other hand, rising inflation and price dynamics also make a case for tightening policy, especially if these trends prove long-lasting. Supply chain issues and difficulties finding qualified workers to fill a record number of job openings during the recovery have pushed prices higher across a range of goods for both consumers and producers. Core consumer prices, as measured by the Bureau of Labor Statistics' consumer price index excluding food and energy prices, surged by 3.8% year-on-year for the fastest rise in nearly three decades, though some of this gain came as a result of "base effects" off last year's pandemic-depressed lows.

    And inflation expectations among consumers have risen sharply compared to several months ago, with consumers expecting inflation of 4.0% next year and of 2.8% in five years, according to the University of Michigan's consumer sentiment index. The Federal Reserve, however, has so far reiterated it believes inflationary trends will be transitory and ease once year-over-year comparisons pass the worst points of the pandemic last year.

    "The Fed will likely continue to talk about 'transitory' inflation at next week’s FOMC meeting, but with doubts starting to creep in from various Fed officials we suspect the Jackson Hole Conference in late August could be very interesting," James Knightley, chief international economist at ING, wrote in a note. "This could see a shift in language that really opens the door much wider to a December QE taper announcement."

    "With the economy roaring back, jobs returning and inflation likely to remain higher for longer we continue to see the risks skewed towards an earlier interest rate rise," he added. "The Fed is still saying early 2024, but we think early 2023 is more likely and it could come even sooner."

    Retail sales

    The May retail sales report from the Commerce Department will be among the major economic data reports out next week, offering a look at how consumer spending trends have shifted with the economic recovery now well under way.

    Consensus economists expect retail sales will decline by 0.7% on a month-over-month basis. This would be the first monthly drop in retail sales since February, reflecting more moderation after an exceptionally strong 10.7% monthly rise in March. That, in turn, had been aided by the distribution of stimulus checks under Congress's last coronavirus relief package, giving many consumers a short-term boost to spending power.

    In April, retail sales came in unchanged on a month-on-month basis. Under the hood, however, some of the categories that had seen some of the strongest rebounds during the reopenings gave back some advances. Clothing and clothing accessories stories, for instance, saw sales drop 5.1% in April over March, though these sales were up by more than 700% on a year-over-year basis, when lockdowns were rampant across the U.S. A similar dynamic played out for sporting good and hobby stores, and food and beverage stores saw sales slow markedly from March.

    Other industries saw sales rise more markedly. Auto and other motor vehicle dealers posted a 3.1% increase in sales in April, and sales in that category more than doubled over last year as stay-in-place orders were lifted and mobility picked up. The Bureau of Labor Statistics' May consumer price index showed a 7.3% increase in prices for used cars and trucks, portending what could be another gain in retail sales in this category in May."

    "Economic Calendar
    • Monday: N/A

    • Tuesday: Retail sales, advanced month-over-month, May (-0.5% expected, 0.0% in April); Retail sales excluding autos and gas, month-over-month, May (0.0% expected, -0.8% in April); Empire manufacturing, June (22.0 expected, 24.3 in May); Producer Price Index, month-over-month, May (0.5% expected, 0.6% in April); Producer Price Index excluding food and energy, month-over-month, May (0.5% expected, 0.7% in April) Producer Price Index, year-over-year, May (6.2% expected, 6.2% in April); Producer Price Index excluding food and energy, year-over-year, May (4.8% expected, 4.1% in April); Capacity Utilization, May (75.1% expected, 74.6% in April); Industrial production, month-over-month, May (0.6% expected, 0.5% in April); NAHB Housing Market Index, June (83 expected, 83 in May); Total Net TIC Flows, April ($146.4 billion in March); Net long-term TIC flows, April ($262.2 billion in March)

    • Wednesday: MBA Mortgage Applications, week ended June 11 (-3.1% during prior week); Housing starts month-over-month, May (4.5% expected, -9.5% in April); Building permits, month-over-month, May (-0.2% expected, -1.3% in April); Import price index, month-over-month, May (0.8% expected, 0.7% in April); Export price index, month-over-month, May (0.7% expected, 0.8% in April); FOMC rate decision

    • Thursday: Fed Business Outlook Index, June (30.0 expected, 31.5 in May); Initial jobless claims, week ended June 12 (360,000 expected, 376,000 during prior week); Continuing claims, week ended June 5 (3.499 during prior week); Leading Index, May (1.1% expected, 1.6% in April)

    • Friday: N/A
    Earnings Calendar
    • Monday: N/A

    • Tuesday: Oracle (ORCL) after market close

    • Wednesday: The Honest Company (HNST), Lennar (LEN) after market close

    • Thursday: Kroger (KR) before market open; Adobe (ADBE) after market close

    • Friday: N/A "
    MY COMMENT

    Look like another BORING week. it is OBVIOUS that the FED.....is not going to change anything. anything else next week.......is irrelevant. It would be nice if the markets just moved on for at least 3-4 weeks after this week. The CONSTANT OBSESSION with the FED, inflation, and jobs is just a total waste to time.

    BESIDES being simply economic indicators and NOT a reflection of any particular business....the ONLY usefulness to the constant DIN over these items is just Psychological.....torture. We need to....MOVE ON....and MOVE UP.
     

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