Part of this drop just doesn’t make sense to me. I don’t see the average investor struggling (yet), to justify a panic sell off like we’ve witnessed. Non of this makes sense to me. In a way the covid drop didn’t make sense to me either, but then it ricochet right back to new highs. This is just simply… staggering
With this kind of erratic market and our obvious downward movement for the last several months, I try to look at it in simple terms. I like to read some of the data and evaluate what I see with my own eyes, but I don't over think it. This downturn, correction, bear market, recession, "crash" or whatever we may end up labeling it was going to visit us at some point. Rather down the road or right now at the present time. I look at it this way...it is part of the market cycle as far back as we want to look. Sure, these things have happened at different times and for different reasons. Some of it due to government incompetence, some of it to wars, bad monetary policies, and the list could go on and on. It is normal...even if it is for logical, dumb, or foreseeable reasons. My point is it happens historically. Secondly, if we are reinvesting dividends or making some contributions during these times we are getting more shares of our companies at a cheaper price and expanding our portfolio's at a better price point. As I do this, all along time is passing and I am accumulating. Eventually this thing turns around and away we go to set new highs down the road. More time passes and the compounding interest begins to build and it just keeps building over time. It is during that time my long term investing plan rewards me and usually in a big, big way over the long haul. I like to cuss and discuss the markets, economy, and our policy makers and the how and why things are happening. However, I remain focused on my long term plan by simply using those two bits above in this post. I realize that is a simple way of breaking it down, but it has kept me focused and realistic for a long time now. Maybe it will help somebody else passing through.
It is looking like a tough day ahead. Worst first half of the year in 52 years being reported. Futures already down quite a bit. We are certainly going to be tested from here on out looks like.
Agree Smokie. But...you and I know that this is just part of the NORMAL market process. What is happening is at least.......rational......when you look at the handful of factors that have been beat to death in this thread.....that are the cause of this drop. Now the FACT that what is happening is rational considering the events and factors that are impacting stocks and the economy.....does not......mean that the amount of the drop in some particular stock is rational. I believe there are many BIG CAP stocks that have been driven down much more than is rational. But....that is what happens in a bear market. It is a process and a function of time. No matter how much you want to push it forward or rush it......it just takes time to get to the end.
Yes to that. We and most here have pointed out the main causes behind it for sure. Time and patience...Time and patience.
As usual.....here is the reality for investors that have the ability to deal with this market. My guidance for this bear market https://www.riskhedge.com/outplacement/my-guidance-for-this-bear-market1/rcm (BOLD is my opinion OR what I consider important content) "US stocks are in a bear market… The S&P 500 has fallen around 20% from its record high in January. The tech-heavy Nasdaq is down nearly 30% this year. The American Association of Individual Investors survey shows there are more stock market “bears” today than at any time since the ‘08 meltdown. If you’re feeling nervous or confused… If you’re wondering what to do with your money today… This RiskHedge Report is for you. Today, I’ll show you what a bear market ultimately means for your money, and why it’s presenting a buying opportunity for long-term investors. Let’s dive in. What does a bear market mean for your money? We’ve had 25 bear markets since 1929. They typically last a little over one year, during which US stocks drop 33%, on average. The S&P has fallen more than 20% since peaking in January. If this is an “average” bear market, stocks will likely continue sliding a bit further. It’s tempting to sell everything when you read this. Why wouldn’t you get out of the market if we have further to fall? Problem is… there’s no such thing as an average bear market. Some sell-offs trudge along for years, others only last a few months. Nobody can predict what’s going to happen next. You could dump your entire portfolio tomorrow, only to see stocks rip higher. And then you have a real problem: when to jump back in. It’s extremely difficult to time markets. Most professional money managers can’t even do it. I don’t know how long this downturn will last, but here’s what I do know… Time in the market beats timing the market. The S&P 500 has averaged a 9.9% return since 1990. In other words, investors who bought and held the index banked roughly 10% per year. Guess what happened to those returns if you tried to time the market and missed the five best days each year? Instead of making 10% per year… you lost 4%. Here’s the catch… the best days happen in the worst markets. The four strongest days ever for US stocks all happened during the Great Depression. The next two best days took place during the 2008 financial crisis. And more than half of the S&P 500’s biggest “up” days in the last 20 years occurred inside a bear market. A year from today, stocks will likely be higher… Bear markets are scary for investors. It’s not fun watching a sea of red stock tickers every day. It can feel like the selling will never stop. Using 90 years of market data as a guide, stocks likely have further to fall. But for long-term investors, this isn’t the time to sell. It’s the time to buy. As famed value investor Shelby Davis once said: “You make most of your money in a bear market, you just don’t realize it at the time.” Investors are more bearish than at any other time since the ‘08 crisis. According to the latest Bank of America fund managers survey, portfolio managers are sitting on their highest cash positions since 9/11. Folks are panic selling, driving down stock prices and valuations. If you plan to be in the markets over the next few years, you want to be buying this panic, not selling it. Buying stocks during downturns has proven to be a winning strategy. The S&P fell 15%+ on 26 occasions since 1957. Stocks were higher a year later 92% of the time. They gained 20%, on average, in that following year. That’s a great track record. The evidence is clear. Investors who embrace panic and buy during sell-offs reap the rewards. Many individual stocks have been taken to the woodshed and may be close to bottoming. Some of the world’s best businesses are on sale today. Take Amazon for example. It’s in the midst of its sharpest drawdown since 2006. The stock is trading where it was in September 2018… despite Amazon’s business being twice as large. Meta (Facebook) and Google are selling for their cheapest valuations in history. In fact, when measured by free cash flow, they’re now trading at a lower valuation than Coca-Cola, a 120-year-old soda maker that barely grows. That’s never happened before… Computer chip stocks—my slam-dunk investment of the decade—are now as cheap as most of them have ever been. There was a lot of froth in the market that needed to be washed out. In November, Rivian, an electric truck maker with only $1 million in sales, was valued at $150 billion. We’ve swung from one extreme to the other. Many of the world’s best businesses got clobbered. Some are cheaper than they’ve ever been. This is a great opportunity to buy shares of businesses you believe in. The greatest investor of all time agrees. For years, Warren Buffett complained stock valuations were too high. That led him to sit on a record $150 billion cash pile. Now Buffett is putting money to work. He bought $50 billion worth of stock last quarter, the most money he’s invested since just after the ‘08 meltdown. Buffett is taking advantage of this downturn to buy great businesses at big discounts. And that’s what I’m doing." MY COMMENT It is not easy and it is not fun. Human emotions come out in force when money and life savings are involved. BUT.....as I said above it is a process and in the end....other than deciding to simply sell out.....you dont have any real control over what the markets are doing.....especially over the short term. I am not saying that everything will necessarily resolve according to some "average" or "statistic". Every bear market is different. We are in a prefect storm of conditions right now causing this one and I do believe that it will last till year end minimum......and.....worst case......till the next election in 2024. There are NO GUARANTEES in investing. The best you can do is skew the PROBABILITIES in your favor by being a long term investor.
Knowledge is power for an investor. Many investors have NEVER gone through a very nasty bear market. The best they can do with their lack of personal experience is look for information that can give them some bit of a REALITY CHECK of what to expect and how it all happens. 7 Things Investors Should Know About a Bear Market The S&P 500 has officially dipped into bear market territory. https://money.usnews.com/investing/articles/things-investors-should-know-about-a-bear-market (BOLD is my opinion OR what i consider important content) "Earlier this month, the S&P 500 officially entered bear market territory. A bear market is an extended period of prolonged price declines in the stock market. It is typically defined as a decline of at least 20% from recent highs for stock market indexes such as the S&P 500, the Dow Jones Industrial Average or the Nasdaq composite. The S&P 500 hit an all-time high of 4,818 early this year, but concerns over persistently high inflation, aggressive Federal Reserve interest rate hikes and the prospect of a U.S. economic recession had the S&P 500 trading back down around 3,911 in late June. Bear markets are relatively common in the history of the U.S. stock market, often accompanying U.S. economic recessions. Bear markets can be extremely scary for investors who are watching their portfolios seemingly evaporate on a daily basis. However, they have historically been no cause for panic for long-term investors with diversified portfolios of high-quality stocks and the discipline to weather the storm. Bear markets are a natural part of the U.S. economic cycle, and they can even serve as excellent opportunities for investors who understand the long-term relationship between stock prices and the fundamental performance of the underlying companies. Here are seven things investors should know about bear markets: Bear markets are excellent buying opportunities. Bear markets typically don't last long. The S&P 500 has averaged a 29.8% decline during bear markets. Bear markets associated with recessions are much worse. Bear markets are part of healthy market cycles. Beware the bear market rally. Stocks will rebound before the economy. Bear Markets Are Excellent Buying Opportunities Historically, bear markets have provided investors with excellent opportunities to buy high-quality stocks at a discounted valuation. When the entire stock market falls, even most high-quality stocks are dragged down with it. Assuming the overall market eventually recovers, this downdraft in stock valuations provides investors with periodic opportunities to scoop up shares of some of the best stocks in the market at a cheap price relative to their longer-term earnings and cash flow outlooks. In fact, Ryan Detrick, chief market strategist for LPL Financial, says buying stocks on the day the S&P 500 transitions to a bear market has historically generated relatively good one-year returns. Since 1950, the S&P 500 has averaged a nearly 15% return in the 12 months after it entered bear market territory, according to LPL. Of course, past performance is no guarantee of future returns, and Detrick says there are a handful of exceptions to the rule. The S&P 500 generated a negative return in the year following the beginning of the 1973 recession, the dot-com bubble in 2000 and the global financial crisis in 2008. "The good news is we don't see an economy like that over the next year, so the likelihood of higher prices (maybe significantly higher) is quite strong, in our view," Detrick says. Bear Markets Typically Don't Last Long Another thing investors should remember to keep bear markets in perspective is that they haven't historically lasted very long. In fact, the average S&P 500 bear market since 1950 has lasted just 11 months, according to LPL Financial. Given that bear markets begin at the peak of the previous bull market, the current bear market technically began back in January. “At more than five months old, it is already older than six other bear markets going back nearly 40 years," Detrick says. In fact, the only bear markets since 1982 that have lasted longer than the current one are the dot-com bubble and the 2008 financial crisis. The bear market during the initial weeks of the U.S. COVID-19 pandemic in 2020 lasted a little over a month. While all the financial media headlines about an S&P 500 bear market may have come in the past couple of weeks, Detrick says there's a real possibility that the worst of the bear market may already be in the rear-view mirror. When the financial media declares an official bear market, it can understandably be scary for investors because of the prospect of additional losses. However, a 20% loss is already a significant decline. From a historical perspective, the S&P 500 typically has limited additional downside once it hits the 20% mark. The S&P 500 Has Averaged a 29.8% Decline During Bear Markets It may feel like the sky is falling and your portfolio is going to zero during a bear market. However, since 1950, the average bear market decline is only 29.8% from previous highs, according to LPL Financial. Crunching the numbers on the 2022 situation based on historical averages may be a reassuring exercise for investors. Applying the 29.8% peak-to-trough historical bear market average for the S&P 500 to the current situation, the current bear market would bring the S&P 500 down to around 3,382 before the market finds a bottom. From current levels, that 3,382 bottom would represent only about 13.5% additional downside. Compared to the average historical 12-month return for the S&P 500 once it enters bear market territory (14.8%), some investors may see that 13.5% potential downside as a risk worth taking to buy the dip. Bear Markets Associated With Recessions Are Much Worse LPL Financial breaks down its analysis of previous S&P 500 bear markets into two categories: bear markets associated with economic recessions and bear markets not associated with economic recessions. Since 1950, there have been eight S&P 500 bear markets that were not associated with a U.S. economic recession. Those eight bear markets that didn't coincide with a recession produced an average peak-to-trough S&P 500 decline of just 23.8%. An economic recession is defined as two consecutive quarters of negative U.S. gross domestic product growth. The U.S. reported a surprise 1.4% decline in GDP in the first quarter of 2022. Assuming the U.S. avoids a recession and the historical trends hold, there may be very little additional downside for the S&P 500 in its current bear market. Unfortunately, there are historical exceptions as well. In 1987, the S&P 500 experienced a 33.5% pullback during a bear market that was not associated with a U.S. recession. Fortunately, Detrick is not anticipating a U.S. recession in 2022. "Yes, 1987 is in there, but most of the other times stocks bottomed near where we are now, suggesting potentially limited pain from current levels," he says. Bear Markets Are Part of Healthy Market Cycles Bear markets may be scary, but it's important to understand that the U.S. stock market is cyclical in nature. There's nothing inherently wrong with a downturn in the economy or the stock market. In fact, bull markets and bear markets have historically been regular occurrences throughout the history of the S&P 500. Stocks are subject to a phenomenon known as the investor sentiment cycle. Since 1975, the rolling annual 30-year return of the S&P 500 has always stayed between around 8% and 13.6%. That return has been remarkably consistent over the long term. However, as most investors have experienced, there have been plenty of wild swings in the S&P 500 over one- or two-year periods. These short- and medium-term swings in stock prices and valuations are part of the investor sentiment cycle. Stock prices are driven by supply and demand, and the demand element of that equation has a major psychological component. "Be fearful when others are greedy and greedy when others are fearful," investing guru Warren Buffett once famously said. During bear market cycles, it's natural to feel fearful, desperate and pessimistic. The difficult part about navigating a bear market is that the best thing to do historically during these troughs in the investor sentiment cycle is to buy stocks, not sell. Beware the Bear Market Rally It may be a good idea for investors to buy the dip in high-quality stocks during a bear market and hold on for the long term, but shorter-term traders should beware a phenomenon known as the bear market rally. A bear market rally is a sharp, short-term rally in stock prices within a bear market. Bear market rallies are also sometimes called dead cat bounces, sucker rallies or bull traps. Price action in financial markets is rarely perfectly smooth, and market dynamics trigger periodic retracements during both bull and bear markets. The key to successfully navigating this noise is understanding these periodic bear market rallies are often short-lived. John Lynch, chief investment officer for Comerica Wealth Management, says S&P 500 bear market rallies are common, large and fleeting. He points to a study by Strategas Research Partners referencing data since 1950 that indicates the average bear market rally sees gains of approximately 15% and lasts about two months. Traders too eager to declare the bear market bottom are running the risk of falling victim to a bear market rally. Stocks Will Rebound Before the Economy The stock market is a leading economic indicator, meaning stocks will recover before U.S. economic data does. Assuming the U.S. avoids a recession, stock prices will likely be dictated by market expectations related to economic data associated with inflation and interest rates. In May, the Labor Department's consumer price index was up 8.6% from a year earlier, the highest inflation reading since 1981. In response, the Federal Open Market Committee raised interest rates by 0.75 percentage point in June, its largest interest rate hike in 28 years. Inflation is enemy No. 1 for the Federal Reserve at this point, and interest rates are likely still headed significantly higher from current levels. However, investors shouldn't wait for the economy to improve to start buying stocks. The stock market is a leading market indicator because stock prices reflect aggregate expectations for the future rather than current economic conditions. It may take a long time for the Fed to get inflation under control and back in line with its 2% target, but the S&P 500 will likely begin to rebound as soon as investors start to see light at the end of the inflation tunnel." MY COMMENT I have no doubt that this bear market WILL be combined with a recession. I believe we have been in a recession for at least a month or two now. I also believe that the economy.....especially the small business side of the economy.....is much worse than people know. I have NO illusions that we are going to simply pop out of this bear market in just a month or two. My view......we are looking at another 6-12 months minimum.......2 years maximum. I also believe we have another 10-20% to the down side of the markets before we hit the ultimate bottom. BUT......in spite of my view......I continue to be fully invested for the long term as usual.
Here is the economic data that no one will care about. US jobless claims total 231,000 last week https://finance.yahoo.com/news/jobless-claims-june-30-2022-123546658.html (BOLD is my opinion OR what I consider important content) "Initial jobless claims ticked down last week, but were marginally higher than forecast, as investors continue to assess the labor market for potential signs of a slowdown. First-time filings for unemployment insurance in the U.S. totaled 231,000 for the week ended June 25, falling slightly from the prior week's upwardly revised 233,000, the Department of Labor said Thursday. Economists surveyed by Bloomberg had expected the latest reading to come in at 230,000. The 4-week moving average, which smooths out some weekly volatility in the data, was 231,750, an increase of 7,250 from the previous week's revised average, per the Labor Department. Claims filed last week held near a five-month high but continue to show the labor market remains hot, even as tighter monetary conditions and persistent inflation raise worries that unemployment may spike. Even after increases in the number of Americans filing for unemployment insurance in recent weeks, claims remain only slightly above pre-pandemic levels. Filings for unemployment insurance averaged about 218,000 per week throughout 2019. The latest weekly employment report comes ahead of a busy week for labor market data after the July 4th holiday weekend, with the Labor Department's key monthly jobs report for June due out next Friday. Employment levels have so far remained a bright spot in the U.S. economy as worries of a recession mount among strategists. The Bureau of Economic Analysis reported Wednesday that the U.S. economy shrank at an annualized pace of 1.6% in the first quarter, reflecting a deeper contraction than previously reported. Moreover, Americans have been grappling with a surge in the cost of gas, food, and shelter, with consumer prices climbing 8.6% last month, the fastest rate since 1981. Still, many economists have projected that unemployment will continue to hold below 4.0%. Last month, the economy created 390,000 news jobs and the unemployment rate came in at 3.6%. "Defensive leadership indicates a recession is looming, yet we find this difficult to reconcile for 2022 given full employment in the U.S," Comerica Wealth Management Chief Investment Officer John Lynch said in a recent report. "Full employment in the U.S. should prove a strong buffer against rising recessionary risks."" MY COMMENT I dont trust any of this sort of eonomic data at the moment. The economy is extremely disrupted from the shut down and will continue to be very difficult to read going forward.
My view of the very short term.....the markets today.....the early big losses are suspect in my view. I dont believe there is any real basis for the drop we are seeing today. I believe it is all short term trading driven by the BIG BOY traders. I would not be surprised to see the drops that we are seeing right now....lessen significantly....by the close. Of course over the short term......a day....no one knows anything. It is simply a crap shoot.
I think this is a good sign......not that anyone else will. Fed’s preferred inflation measure rose 4.7% in May, around multi-decade highs https://www.msn.com/en-us/money/mar...ulti-decade-highs/ar-AAZ244N?fromMaestro=true (BOLD is my opinion OR what I consider important content) "Inflation held at stubbornly high levels in May, though the monthly increased was slightly less than expected, according to a Commerce Department gauge closely watched by the Federal Reserve. Core personal consumption expenditures prices rose 4.7% from a year ago, 0.2 percentage points less than the previous month but still around levels last seen in the 1980s. Wall Street had been looking for a reading around 4.8%. On monthly basis, the measure, which excludes volatile food and energy prices, increased 0.3%, slightly less than the 0.4% Dow Jones estimate. Headline inflation, however, shot higher, rising 0.6% for the month, much faster than the 0.2% gain in April. That kept year-over-year inflation at 6.3%, the same as in April and down slightly from March's 6.6%, which was the highest reading since January 1982. In addition, the report reflected pressures on consumer spending, which accounts for nearly 70% of all economic activity in the U.S. While personal income rose 0.5% in May, ahead of the 0.4% estimate, income after taxes and other charges, or disposable personal income, declined 0.1%. Spending adjusted for inflation fell 0.4%, a sharp drop from the 0.3% gain in April. The personal saving rate edged higher, rising to 5.4%, up 0.2 percentage points from the previous month. Fed officials are watching the data closely as they seek to control runaway inflation. Central bank policymakers generally watch core inflation more closely because they believe monetary policy is less effective at controlling the ups and downs of gas and grocery prices. However, Fed Chairman Jerome Powell has said in recent days that he also is watching headline numbers closely as well as gas prices average about $4.86 a gallon. The consumer price index, which measures a broad range of goods and services and is more closely watched by the public, rose 8.6% in May, its highest level since late 1981." MY COMMENT I think these numbers show some progress. AND....I think we will see progress over the next 6-12 months as we slog through recession.
I am not sure this little article is telling us anything that we dont already know. But......whatever. Tech stocks are having their worst year ever. Here's what history says happens next: Morning Brief https://finance.yahoo.com/news/morning-brief-tech-stocks-first-half-2022-100037356.html (BOLD is my opinion OR what I consider important content) "The Nasdaq (^IXIC) and Russell 2000 (^RUT) are having their worst year ever. The Dow Jones Industrial Average (^DJI) is off to its worst start since 1962. And you'd have to travel back to 1970 for a worse first and second quarter in the S&P 500 (^GSPC). Investors wondering what happens the rest of the year when markets are down big through June won't find much comfort in mixed data. Nor much comfort in the finding that all roads for stock investors tend to lead back to the Federal Reserve. Let's start with the Nasdaq, which is down a record 29% so far this year, and has lost 10% in the first half of a year 8 times. Looking at the table below, the average return in the second half was a loss of 5.8% with a median loss of 8.7%. Not much for investors to get excited about. Notably, the worst return prior to 2022 was twenty years ago in 2002, as the busted tech bubble bear market entered its second year. The Nasdaq lost an additional 8.7% into the end of 2002, for a total loss of 32%. With the economy recovering from recession, the Fed introduced another round of cuts toward the end of 2002 — taking rates down to 1.25% for the first time since 1961 — and stocks finally found their footing. The tech index, however, would not return to its prior record high until 2015. Looking at the Dow's performance we see few modern parallels — 3 of the Dow's worst 4 years ever took place before the US entered World War II. Through Wednesday's close, the Dow is on pace for its 5th-worst year on record. Like the Nasdaq, however, we find the Global Financial Crisis front and center among the worst years endured by stock market investors. The Dow lost 14.4% in the first six months of 2008, only to drop another 22.7% over the balance of the year as the global economy teetered on the brink of collapse. That same year, the Nasdaq was down 13.6% through the end of June. The failure of Lehman Brothers opened the floodgates in September of that year, and the tech index got whacked for an additional 31% loss, losing some 40.5% by the time the year was up. As investors may recall, the market finally turned around when the Fed announced its to-that-point unprecedented quantitative easing program in March 2009. The theme for investors, as ever, is that the market moves with the Fed. But there's nuance in this view. Exactly how long it takes stocks to recover bear market losses tends to depend on where we are within a secular — or decades-long — timeframe. After prolonged secular bull markets — such as the two-decade bull of the 1980s and 1990s — a secular bear market tends to follow. These are periods where old market paradigms give way to new ones amid violent portfolio adjustment. From 2000-2009, for instance, a secular bear market saddled investors with a "lost decade." Eventually, this period gave way to the second tech boom we're currently watching unwind. And similar to the early 2000s, a rapidly changing macro environment is resulting in violent portfolio rotations across asset classes — it is no coincidence that a traditional 60/40 portfolio is having its worst year since 1970. The 1970s, of course, are the last period in US economic history known for persistently high inflation, which the late Paul Volcker famously broke as Fed chair with aggressive rate hikes in the early '80s. The oil embargo of 1973 kicked off a nasty, two-year bear market in the Nasdaq, during which the index would eventually shed half its value. The same year, the Dow endured a 16% decline. Of course, this era might fell all too familiar to investors today. Soaring energy prices have been a feature of what appears to be a new era of persistently high inflation, ending what's been a 40-year decline in interest rates. If we take the Fed at its word — that the central bank is singularly dedicated to fighting inflation — we shouldn't expect Powell & Co. to deliver relief to investors anytime soon. But if the Fed does pivot, as markets are eventually pricing in for 2023, we could see an "echo bubble" down the road. And maybe this is something for investors to get excited about." MY COMMENT This drop....so far.....does not feel anywhere as dismal as the dot-com crash in 2000 to 2002 or the near world wide economic collapse of 2008/2009. BUT.......this bear market recession is going to get worse before it gets better. I know there are many, many, investors that have no knowledge or experience with the dot-com crash......as well as a significant number of investors that were not around for the 2008/2009 crash. So for these investors....the current event......will be the WORST investing event of their lives. Get used to it......as I said above....this is part of the NORMAL market process.
I am amazed (sarcasm)......that we are not hearing anything from the stock speculators that captured the news in 2021. Seems like a lifetime ago.
On a different economy note, I have commented/posted a few times about the ongoing ineffective and detrimental policy decisions related to our energy sector. Well, this administration got a BIG slap across the face today regarding the rogue tactics being used by the EPA to dramatically and politically change our energy. This is an example of their mindset on how they are going about trying to implement changes. I will not dive deep into the details on this specific incident, but they are using this agency (EPA) in ways that are purely politically driven to accomplish this agenda at ANY cost. Well, they got hammered and taken to the woodshed today. This is a big win against the over reaching policies continually being pursued. Supreme Court curbs EPA authority to regulate fossil fuels The U.S. Supreme Court handed down a highly anticipated opinion on Thursday that curbed the U.S. Environmental Protection Agency (EPA)’s power to regulate fossil fuels. The decision in West Virginia v. Environmental Protection Agency is expected to prove consequential for both U.S. and global ambitions to reduce carbon emissions. In a 6-3 vote, siding with Republican-led state and coal companies, a majority of the court’s justices held that the EPA lacks broad authority, absent explicit authority from Congress, to cap fossil fuel emissions from the country’s existing power plants. "There is little reason to think Congress assigned such decisions to the Agency," Chief Justice Roberts wrote in the majority opinion, joined by justices Thomas, Alito, Gorsuch, Kavanaugh, and Barrett, later adding: "We also find it 'highly unlikely that Congress would leave' to 'agency discretion' the decision of how much coal-based generation there should be over the coming decades." The court’s holding is a victory for the state of West Virginia, the country’s second-largest coal-producing state, which sued the EPA along with 17 other states that joined the litigation — Alabama, Alaska, Arkansas, Georgia, Indiana, Kansas, Louisiana, Missouri, Montana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota, Texas, Utah, and Wyoming, and Mississippi Governor Tate Reeves. The ruling is in part a preemptive instruction for the EPA because the agency currently lacks rules that regulate power plants. Prior administrations under Presidents Barack Obama and Donald Trump respectfully expanded and contracted the EPA's authority. Under the Obama-era Clean Power Plan, energy producers were required to shift away from fossil fuels to more sustainable sources such as wind and power. Those rules were relaxed under the Trump-era Affordable Clean Energy Rule, which an appellate court vacated, finding its requirements "arbitrary and capricious." The decision is expected to frustrate the Biden administration's goal to slash U.S. greenhouse gas emissions up to 52% by 2030 and decarbonize the country’s electric grid by 2035. Behind China, the U.S. is the world’s second-largest contributor to carbon emissions. Alexis Keenan is a legal reporter for Yahoo Finance.
The only thing that correlates with the dot com bubble, is the investment in nothing at the time and today. Now let me reflect on that before Cajun is gonna come here and kick my a$$, no, I don’t mean crypto.. I mean ANYTHING that was tremendously overvalued beyond reason. That’s your non profit generating tech stock sweethearts, spacs, meme stocks and yes, crypto….. I actually think that the spending (not calling this investing) on NOTHING is staggering at similar proportions to pre dot com bubble levels. you just had different motivational aspects. Back then it was mainly giant venture capital money, and this time it was the young investor which was handed free fake money. To staggering amounts. The amount of money that has left the market since the beginning of this current decline has topped that of the big depression and that’s saying a lot. Maybe that’s why some (most?) investors here question as to why there’s such a huge sell off? It’s easy to understand it this way… if you were given free money and you now lost it, the sell of doesn’t really hurt your pocket since it’s not your money to begin with. Just an observation
Well I'm going to look at another house this evening. This one appears to have good potential. Today I see a good number of houses pop up for sale and I expect to see more tomorrow before the long weekend. I believe house prices will level off once the supply catches up to the demand but this isn't going to happen quickly or soon. I would imagine we are a year out before they start to plateau. All speculation.
I was in the RED today.....by a moderate amount. I also got beat by the SP500 by 0.14% for the day. At least the day did not end up nearly as bad as it looked like with the start that we saw this morning. My account was held up.....somewhat.....by my green stocks today....Honeywell, Home Depot, and Costco. I notice that poor Amazon is right on the edge of going negative in stock price for the 3 year time period. As of the close today it is +5.75% for the past three years. I expect it will go negative some time over the next week or two and than will begin to cut into the next milestone.....the 5 year time span.
Not a good thing to make history.....in the markets. S&P 500 posts worst first half since 1970, Nasdaq falls more than 1% to end the quarter https://www.cnbc.com/2022/06/29/stock-market-futures-open-to-close-news.html (BOLD is my opinion OR what I consider important content) "Stocks fell on Thursday, as the S&P 500 capped its worst first half in more than 50 years. The Dow Jones Industrial Average shed 253.88 points, or 0.8%, to 30,775.43. The S&P 500 slid nearly 0.9% to 3,785.38, and the Nasdaq Composite pulled back by 1.3% to 11,028.74. Thursday marked the final day of the second quarter. The Dow and S&P 500 posted their worst quarter since the first quarter of 2020 when Covid lockdowns sent stocks tumbling. The tech-heavy Nasdaq Composite is down 22.4% for the second quarter, its worst stretch since 2008. The S&P 500 posted its worst first half of the year since 1970, hurt by worries about surging inflation and Federal Reserve rate hikes, as well as Russia’s ongoing war on Ukraine and Covid-19 lockdowns in China. “We had the unprecedented pandemic that shut the world down and the unprecedented response, both fiscal and monetary,” Stephanie Lang, chief investment officer at Homrich Berg, told CNBC. “It created the perfect storm with regard to surging demand and supply chain disruptions, and now there’s inflation that we haven’t seen in decades and a Fed that was caught off guard.” “Now the market is forced to adjust to this new reality where the Fed is trying to play catch up and slow growth,” she added. The major U.S. indexes are down significantly since the start of 2022 The Dow is down more than 15%, the S&P 500 is down more than 20% and the Nasdaq is down almost 30%. A surge in bond yields earlier in the year and historically pricey equity valuations sent tech stocks tumbling first, as investors rotated out of growth-oriented areas of the market. Rising rates make future profits, like those promised by growth companies, less attractive. The tech-heavy Nasdaq has been hit especially hard this year. The index is now more than 31% below its Nov. 22 all-time high. Some of the largest technology companies have registered sizeable declines this year, with Netflix down 71%. Apple and Alphabet have lost roughly 23% and 24.8%, respectively, while Facebook-parent Meta has slid 52%. On Thursday, Universal Health Services fell 6.1% and helped lead the market lower after it issued second-quarter earnings and revenue guidance below expectations, citing lower patient volumes. Shares of HCA Healthcare lost 4.3%. Abiomed and Viatris were lower by more than 3%. Pharmacy stock Walgreens Boots Alliance was the biggest decliner in the Dow, down 7.2% after the company reiterated its full-year forecast of adjusted per-share earnings growth in the low single digits. Cruise stocks continued to drag, after Morgan Stanley cut its price target on Carnival roughly in half Wednesday and said it could potentially go to zero. Carnival shares were down more than 2% Thursday. Royal Caribbean and Norwegian Cruise Line each fell more than 3%. Home retail stocks were down, too. High-end furniture chain RH saw shares drop about 10.6% after it issued a profit warning for the full year. Wayfair and Williams-Sonoma fell roughly 9.6% and 4.4%, respectively. Inflation and the economy The core personal consumption expenditures price index, the Fed’s preferred inflation measure, rose 4.7% in May, the Commerce Department reported Thursday. That’s 0.2 percentage points less than the month before, but still around levels last seen in the 1980s. The index was expected to show a year-over-year increase of 4.8% for May, according to Dow Jones. The Chicago PMI, which tracks business activity in the region, came in at 56 in June, slightly below a StreetAccount estimate of 58.3. The Federal Reserve has taken aggressive action to try and bring down rampant inflation, which has surged to a 40-year high. Federal Reserve Bank of Cleveland President Loretta Mester told CNBC Wednesday that she supports a 75 basis point hike at the central bank’s upcoming July meeting if current economic conditions persist. Earlier in June, the Fed raised its benchmark interest rate by three-quarters of a percentage point, the largest increase since 1994. Some Wall Street watchers are worried that too-aggressive action will tip the economy into a recession. “We do not believe the stock market has bottomed yet and we see further downside ahead. Investors should be holding elevated levels of cash right now,” said George Ball, chairman of Sanders Morris Harris. “We see the S&P 500 bottoming at around 3,100, as the Federal Reserve’s aggressive, but necessary inflation-fighting measures are likely to depress corporate earnings and push stocks lower.” Courtney Garcia, senior wealth advisor at Payne Capital Management, said even if inflation is peaking, it’s going to stick around for a while longer but that there are still good opportunities for investors in this environment. “The markets are going to price in the recession before the recession actually happens and that’s what you need to focus on as an investor,” she told CNBC’s “Power Lunch” Thursday. “When you have a period like now where the markets are down more than 15% in the first half of the year, which has happened a couple times in history, they tend to have a really good second half of the year by an average of about 24%.” However, Lang said that in this current downturn, the Fed is less likely to step in with easy policy to help limit big losses in equities — which has been known since the days of former Fed Chair Alan Greenspan as “the Fed put” — than it has been in the past. “Inflation is going to persist for a while, so it’s our expectation that the Fed will stay full steam ahead and you won’t have that Fed put that we’ve seen in every other big sell-off in the last decade plus,” she said." MY COMMENT Thank God....the writer of this little article spared us by not mentioning that the NASDAQ just had its WORST first half EVER. Talk about understatement: "Some Wall Street watchers are worried that too-aggressive action will tip the economy into a recession." Market direction......continues......to be negative.
I know many on here have been SPOILED by the past 13 years of market gains......and.....the last few years of EXTREME mortgage rates. Welcome to the real world. Today’s mortgage rates are still relatively low — here’s why you may want to apply for one sooner than later Today’s 30-year mortgage rate still beats the long-term average of just under 8%. https://www.cnbc.com/select/mortgage-rates-today-still-relatively-low/ (BOLD is my opinion OR what I consider important content) "It’s no secret that the homebuying market looks a lot different than it did over the last two years. For one, continually increasing mortgage rates are making the process even less affordable and average home prices are still near all-time highs. Average rates for the ever-popular 30-year fixed-rate mortgage have been floating around the 5% mark since April this year — the first time in over a decade — with the most recent weekly average rate clocking in at 5.81% at the time of this writing. When comparing all this to 2020 and 2021, rates have certainly gone up. However, putting today’s 30-year rate in context with how the average rate has trended over the last few decades shows us that it’s still relatively low — and relatively affordable. According to Freddie Mac data going back to 1971, the long-term average for 30-year mortgage rates is just under 8%, with the record-high average reaching a whopping 16.64% in 1981. All in all, in context, today’s 30-year 5.81% rate still falls below the historical average rate. What to keep in mind when looking at mortgage rates The 5.81% rate we see today — not so short of the average 6.28% rate we just saw in early June, a record-high since 2008 — might sound the alarm for many homebuyers. After all, these rates show a significant jump from the record-lows we saw in 2020 and 2021. The lowest average 30-year rate was just last year when rates tumbled to an average of 2.96% and even fell as low as 2.65% in Jan. 2021. Of course it’s critical to remind ourselves that the onslaught of the pandemic provided a unique and exceptional circumstance for the housing market. The Federal Reserve’s target rate dropped to near zero to stimulate the economy and made borrowing money cheaper across the board, including mortgages. But as the economy rebounds, inflation rises and the Federal Reserve continues monetary tightening, we can see mortgage rates going back up — and they’re predicted to climb even higher this year. If you’re looking to buy a new home, now is likely the better time to lock in a lower rate compared to what you may be able to get in the future." MY COMMENT YEP......forget about it......those low rates for mortgage money are long gone.
THIS.....is a BIG ISSUE going forward for investors and the country. America’s MBAs Are the Latest Skeptics of Capitalism The foundation of the US economic system no longer gets automatic approval at the nation’s elite business schools. https://www.bloomberg.com/opinion/a...e-the-latest-skeptics-of-capitalism#xj4y7vzkg (BOLD is my opinion OR what I consider important content) "You might expect to find skeptics of capitalism in sociology or anthropology departments – and let’s be honest, capitalism doesn’t have as many fans lately. But you would think that the basis of our great American economic system could at least count on the approval of business students. As one recent MBA graduate put it, earning an MBA should be “the purest expression of capitalism.” The mission of a business school is to train capitalists – people who own and run businesses. And yet, recently, the former dean of Columbia Business School, Glenn Hubbard, wrote that his students were skeptical of capitalism. In 2019, Harvard Business School dean Nitin Nohria said his biggest challenge was a lack of faith in capitalism. Several economists who teach in business and economics departments have told me that they are experiencing a similar setback in their courses. It could be the changing profile of the average student. Business schools are increasingly accepting women and international students from leftist countries. The top business schools were once populated by people who worked in finance and consulting, but now the student body includes people from less traditional backgrounds who have worked in nonprofits and government. A professor described the change: “There were always students who came here to change the world. Ten years ago, they hoped to achieve this by earning a lot of money and then becoming a philanthropist. Now they come from the NGO [non-governmental organization] world and want to bring those ideals to big business. Harvard MBA data suggests that many applicants still have backgrounds in finance, consulting and private equity compared to 10 years ago. A professor told me that he sees the biggest change in students coming from the consulting industry. Their attitudes may reflect the evolution of this sector. Traditionally, management consulting firms made no apologies for having the goal of helping companies become more profitable. Now, they help companies to implement a capitalism of stakeholders, where profits are sometimes secondary. Young MBA candidates have spent years simmering in an environment where enthusiasm for unbridled capitalism is no longer good business. And some board-bred MBAs genuinely believe that another path isn’t just possible, it’s better. Harvard Business School offers a course called “Reimagining Capitalism,” taught by an accounting professor. I spoke to a self-proclaimed capitalism skeptic who is preparing to attend Harvard Business School after starting his career in consulting and then working in finance. He says his disillusion comes from seeing how capitalism has become (or has always been) about getting as much market power as possible. He doesn’t support socialism – and I haven’t found an MBA that does. But few call themselves capitalists either. A student told me that even students who embrace capitalism are reluctant to admit it because of the political implications. At the very least, skeptics of capitalism are concerned about inequality. I was struck by all the talk of market power and inequality, but without any discussion of the trade-offs that might come from system change. For example, more equality could also mean less growth and higher taxes. A professor told me that when he brought up this point, some students think less growth can be a good thing. They believe that growth necessarily degrades the environment. An MBA candidate pointed to high drug prices as a failure of American capitalism. When I asked him if he thought that might be the price of innovation, he said he thought it would be better to have less pharmaceutical innovation if it saved people from medical bankruptcy. The other thing that struck me was students seeing the capitalist economy as inherently zero-sum. If someone gets rich, someone else must be poorer. If there is more growth, it must be bad for the planet. I was taught something very different: that everyone enjoys growing prosperity, even if some grow more than others. Elon Musk and Jeff Bezos got super rich, but they also built things that made us all better. And that sustainable growth comes from productivity gains, so we get more output using fewer resources and productivity also includes greener and better technology. But the students I spoke with equated success at Musk’s level with less competition and more corruption. The difference in our outlook can also come from a different life experience. I’m old enough to remember the Cold War. Young people may have less enthusiasm for capitalism because their memories are dominated by 9/11, the financial crisis and Occupy Wall Street. A skeptic told me he had never heard a good, credible defense of capitalism. Perhaps today’s MBA students are simply much more idealistic than average. Inequalities have worsened during their lifetime. But it is still remarkable that they care so much about it. An MBA from a good school is a golden ticket to the top 5%. Surveys show that the average American, who likely earns significantly less, does not see inequality as their top concern. But maybe they also act like good capitalists. Rejecting capitalism can be a good career decision for them. Today there are more and more high-paying jobs to define and implement actor models in consulting firms and financial companies. Also, if you are in such a position and you can say that your value is not limited to increasing your company’s results, your job performance is more difficult to assess. Although the economy is not zero-sum, MBA graduates may believe it is because that is how the economy they live in works. There are so many elite jobs in top companies and government. Finance no longer offers the same huge salaries to people in the middle of the pack. MBAs may be for the top 5%, but reaching the top 1% or 2% is much more difficult and more ruthlessly competitive. A professor told me that his students were shocked that earning $500,000 a year puts them in the top 1%. They think it takes a lot more. Perhaps that is why capitalism is so prevalent in the top 10 MBA programs and on the East and West coasts, without necessarily infecting students around the world. I asked a Texas A&M economics professor if his students were skeptical of capitalism, “No,” he replied. “This is Texas after all. If anything, I have to convince them that sometimes regulation is warranted." MY COMMENT This should be a big concern to anyone that invests in businesses through stock ownership. The level of REALITY seen by those in these programs is slipping away quickly. Add to this the HUGE growth of the NGO business over the last 10 years. I constantly hear college graduates say they want to work for an NGO. Ten years ago no one talked about any NGO. This ZERO-SUM thinking is IDIOCY. Nothing more than a thinly disguised excuse for Socialism and/or communism. I pity poor corporate management trying to hire from these schools.......this "stuff" is extreme and dangerous to the culture and social fabric of our system. In the end it will be a significant threat to democracy itself.
