The Long Term Investor

A topic in this thread a bit lately.

The Risk in Being Bearish Now

https://www.fisherinvestments.com/en-us/insights/market-commentary/the-risk-in-being-bearish-now

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

"Waiting for confirmation of a bear market’s end can be costly.

After another nice day Thursday, US and global stocks have both retraced more than half their total declines as of last October’s low. The last time stocks retraced half their decline from January 2022’s highs, it preceded another leg down to a new low, so obviously these kind of “technical” indicators don’t necessarily mean all that much. It also helps explain why good cheer doesn’t abound. Many are skeptical of the rally for a wide array of reasons, from lofty valuations to alleged disconnects between economic reality and markets. Some argue this is a good exit point to take advantage of higher CD rates—or at least that it is too early to enter stocks. We think this ignores a very simple point: Over a year on from stocks’ last high, the risks of being bearish are likely greater than the risks of being bullish.

Averages aren’t predictive, and they are made up of extremes, but consider: Excluding 2022, whose official length and magnitude aren’t certain yet, S&P 500 bear markets since WWII averaged -34% declines in price terms over 15 months. Some were longer. Others were shorter and shallower. Friday will mark 13 months from the S&P 500’s prior peak, and Saturday will mark that anniversary for the MSCI World Index. Based on this history, the baseline probability of the bear market lasting much longer doesn’t appear high.

We realize this doesn’t exclude the possibility of another drop to new lows. We also realize that prospect is scary for many. But the final throes of a bear market, while sharp and painful, are typically short-lived. The V-shaped rebound that usually follows tends to erase them quite quickly, making that last -15% or so drop a distant memory. Remember 2009: That March 9, the day the bear market that accompanied the Global Financial Crisis hit its low, the S&P 500 closed down -24.6% on the year.[ii] The MSCI World was down -24.8%.[iii] But then came the rebound. Over the full year, including that early plunge, the S&P 500 rose 26.5%.[iv] The MSCI World did even better, 30.0%.[v] The recovery more than erased the late plunge.

In our view, the risks of missing the early rebound are greater than those of enduring the final plunge. Even missing the first 15% of a bull market can be a great setback, as you don’t just miss 15%. You miss the compound growth on that 15% over the entire bull market. Consider the growth of a $100,000 investment for two hypothetical investors. Jane has perfect timing and invested her $100,000 in the S&P 500 at market close on March 9, 2009. Jim chose to wait for an all-clear signal and jumped in at market close that March 17, when stocks were up 15% from the low.[vi] When the market closed on February 19, 2020, the day the S&P 500 peaked ahead of COVID lockdowns, Jane had a cumulative 528.9% return, bringing her investment to $628,881.20.[vii] Jim’s return was 446.4%, leaving him with $546,419.30.[viii] Waiting a mere eight days would have cost our hypothetical friend tens of thousands of dollars in missed returns.

This isn’t to say pinpointing the low is possible—it isn’t. But the effort to do so is myopic—and that is the point. And the long-term impact of missing even some of an early bull market can be a very costly decision, potentially much costlier than enduring a decline that stocks quickly retrace. Stocks’ long-term returns include all bear markets along the way, with compound growth in good times wiping away the bad. This is the chief reason stocks are such a valuable vehicle for longer-term growth. The early recovery is the payoff for discipline in tough times. A decline turns into a loss only if you sell. If you grit your teeth and stick it out for the rebound, the next bull market eventually offsets it and then some, keeping you on the path to long-term market-like returns"

MY COMMENT

Of course I like this little article especially the summary that is the last paragraph......since this is the path that I have followed for decades...my entire investing lifetime. I am a fully invested person......ALL the time. I am willing to take the hit of the various corrections and bear markets....NORMAL market behavior.....in return for capturing and compounding ALL the gains as they happen.

I dont have to be right or wrong about the markets......all I have to do is have guts. That requires that I have my portfolio structured in a way that fits my risk tolerance and allows me to sit in the markets and not get panicked out by various short term events and market conditions.

 

The short sellers are out in force today. I can see it in the news which is UNIFORMLY NEGATIVE as to the short term. This was set up last week with the media once again dragging out the old story line about investors being confident that the FED was done raising rates. Actually......nothing but media BS.....I dont see anyone that has a financial brain thinking that thee FED is done with rate increases. It is OBVIOUS that the FED will raise rates another 2-3 times by 0.25%.

Stock market news live updates: Stocks fall as investors ponder Fed's rate path

https://finance.yahoo.com/news/stock-market-news-live-updates-february-6-2023-111713832.html

Stock market is basically going nowhere for the rest of the year: Goldman Sachs

https://finance.yahoo.com/news/stock-market-goldman-sachs-going-nowhere-2023-outlook-111317727.html

Why the red hot stock market is ripe for a cooldown: Morning Brief

https://finance.yahoo.com/news/why-...e-for-a-cooldown-morning-brief-100814238.html

MY COMMENT

This is just a small sample of the coordinated attack that is happening today on the markets....by the short sellers and the financial media being manipulated by the big boys....who make HUGE trading profits over the short term....at least in some quarters.. I could post many more.....but....these are Front page.....top of the fold...articles that are out there today.

Personally I would NEVER believe anything that I see coming out of Wall Street insiders and the BIG Wall Street investment and trading banks. They do not put this stuff out there as a public service.

 

So to continue.

Why the red hot stock market is ripe for a cooldown: Morning Brief

https://finance.yahoo.com/news/why-...e-for-a-cooldown-morning-brief-100814238.html

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

"My happy and positive self badly wants to like how the market has been acting thus far in 2023.

The S&P 500 is up 7.7% this year and the Nasdaq Composite has gained a robust 14.7% in the year's first five weeks.

But full stop, I think you are seeing a classic case of FOMO (fear of missing out) infiltrating these markets.

What is everyone fearful of? Missing out on the precise moment when the Fed says it will pause interest rate hikes.

This is a market pricing in the end of rate hikes for this cycle — and dare I say pricing in rate cuts at some point later in 2023. And this FOMO has built on itself since the middle of January.

But allow me to be the voice of reason for a brief moment.

Corporate fundamentals just don't appear to warrant this upward thrust in the markets.

Per FactSet data, 70% of S&P 500 companies have reported a positive EPS surprise for the fourth quarter — below the five-year average of 77%. S&P 500 companies are beating EPS estimates for the fourth quarter by 0.6% in aggregate, shy of the five-year average of 8.6%.

Fourth quarter earnings are tracking down about 5.3%. Yes, down!

Last week, we saw an Apple earnings miss, another stinky quarter from Amazon, and a lame quarter from Alphabet thanks to ad weakness at YouTube. Meta's quarter was poor quality, too, and earnings badly missed, but the market loved deep cuts to the company's expense guidance for 2023.

Besides the raw numbers, the commentary from corporate executives has hardly been rah-rah. Those aforementioned tech companies continue to signal slowing demand to the extent they are searching for fresh expense offsets.

Starbucks CFO Rachel Ruggeri told me on Yahoo Finance Live on Friday they aren't seeing the disinflation talked up by Fed Chair Jerome Powell last week, but still-rising costs.

"If we look at market pricing so far this year, it's not even pricing in a soft landing. It's pricing in takeoff. It's pricing inflation to come down. It's pricing growth to avoid a recession altogether. It's also pricing in central banks cutting rates starting mid this year. So that is really markets are priced for perfection," BlackRock global chief investment strategist Wei Li said on Yahoo Finance Live.

"And in the near term, beyond FOMO and chasing momentum, it's hard to see a fundamental reason for stocks to keep pushing higher."

Wei Li is spot on.

The market is growing more dangerous by the day. I am not trying to scare the hell out of you, but rather present the clear-headed take. Do with that what you wish.

Happy Trading!

MY COMMENT

Keep in mind that what I "bold" is either "my opinion"......or......what I see as important content. Much of the "bold" content above is not my opinion.

The final comment on this little article....."happy trading"....says it all. It is from a "trading" mentality. something I have no interest in participating in as a long term investor. It is a classic little article......quote one or two people that agree with you......and....include a few statistics that really do not support what you are trying to say.

i actually REALLY LIKE the one statistic in this little article:

"Per FactSet data, 70% of S&P 500 companies have reported a positive EPS surprise for the fourth quarter — below the five-year average of 77%. S&P 500 companies are beating EPS estimates for the fourth quarter by 0.6% in aggregate, shy of the five-year average of 8.6%."

The article tries to use this as a negative.....but....the reality is that this is a very positive data point. Remember a few weeks ago this same type of quote was at 66% positive EPS.....a few days ago it was at 69% positive EPS. Now.....the earnings are at 70% positive EPS. The trend is UP and better than expected earnings are driving the percentage of positive EPS reports higher.

As to the 77% figure....we will end up closer to that figure by the time earnings are over. Earnings are much better than expected by the experts......and.....the amount of the aggregate beat compared to the average is meaningless. What matters is that earnings are handily beating expectations.

 

HERE is the market events and happenings for this week.
Rally in focus, Powell speaks, more earnings pour in: What to know this week

https://finance.yahoo.com/news/stoc...rome-powell-corporate-earnings-174132508.html

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

"The recent stock market rally, and whether momentum can hold up into February, will be the main focus of the week ahead while investors continue to parse through a torrent of corporate financial results.

Wall Street faces a lean economic calendar in the coming days but a hefty docket of earnings, with companies including Walt Disney (DIS), Robinhood (HOOD), Uber (UBER), and Pinterest (PINS) among headliners set to report figures for the fourth quarter.

While few government data releases are on tap in this first full week of February, on the economic front, remarks by Federal Reserve Chair Jerome Powell will be a highlight of the week. Powell is scheduled to be interviewed by billionaire Carlyle Group founder David Rubenstein at the Economic Club of Washington, D.C. on Tuesday.

U.S. stocks dropped Friday after a stunning January jobs report showed payrolls grew by more than half a million last month, dampening prospects for an imminent pause by the Fed on its rate-hiking campaign — a key factor propelling January's rally.

The U.S. economy added 517,000 jobs last month, blowing out economist expectations for a reading of 188,000, while the unemployment rate fell to 3.4% — the lowest since 1969.

Despite Friday's losses, the S&P 500 and Nasdaq Composite closed the week higher, advancing 1.6% and 3.3% respectively. The Dow failed to eke out a weekly gain, ending the past five trading days down 0.2%.

Equity markets have been on a winning streak to start 2023, with optimism fueled by a recent slowdown in the Federal Reserve's downshift to smaller rate hikes and markets pricing in rate cuts this year. For the year, the S&P 500 is up 7.7% as of Friday's close, the Nasdaq 14.7%, and the Dow 2.4%.

Many strategists have expressed doubts about the current rally. Last week at the iConnections Global Alts Conference in Miami, Morgan Stanley's top equity analyst Mike Wilson — a prominent stock market bear — attributed recent gains to the January Effect, a market theory that implies securities' prices increase in the month of January more than in any other month after a year-end sell-off for tax purposes.

On Wednesday, the U.S. central bank lifted its benchmark policy rate by another 25 basis points, its eighth hike of the current tightening cycle, while signaling "ongoing increases in the target range." Despite that hint, markets cheered a suggestion by Chair Powell that signs of "disinflation" were present in the economy.

"Powell embraced the recent disinflation to a greater degree than we were expecting," economists at Bank of America led by Michael Gapen said in a note published Friday. "Financial markets took a clear dovish signal from Powell's press conference, with the S&P 500 rallying by nearly 2.4% from the start of the press conference, and the 2-year yield falling by around 14 basis points."

"Looking ahead, the key question for markets is whether Powell's dovishness was intentional or accidental," the team at BofA said, adding that Powell may strike a more hawkish tone during his appearance at the Economic Club this week. "We think the Fed's embrace of disinflation is genuine and it was always going to be difficult for Powell to send a hawkish message after decelerating the pace of hikes for the second time in as many meetings."

On the earnings side, profits continue to be subpar into the midpoint of the season. The share of S&P 500 companies reporting positive earnings surprises remained flat over the past week, but the magnitude of upside earnings surprises decreased, largely driven by disappointing results from megacap technology giants, according to FactSet Research.

"As a result, the earnings decline for the fourth quarter is larger today compared to the end of last week and compared to the end of the quarter," FactSet's senior earnings analyst John Butters notes. "If the index reports an actual decline in earnings for Q4 2022, it will mark the first year-over-year decline in earnings reported by the index since Q3 2020.

In the coming week, Disney results will be the big event of the earnings calendar.

For Disney, it will be the first time reporting since the return of Bob Iger as chief executive after former CEO Bob Chapek was ousted.

Sophie Lund-Yates, equity analyst at Hargreaves Lansdown notes the pressure is on for Iger to prove he has the right ideas to stimulate growth.

"This is especially true in the streaming business, where excessive spending and long-term demand concerns are front of mind," Lund-Yates said in a note. "For now, consumer spending is holding up better than feared in some areas, so we have faith Disney+ will come good on subscriber additions, especially after Netflix’s better-than-expected quarter, despite tough economic conditions."

"In theme parks, we expect to hear about positive momentum as China reopens and travel continues to normalize," Lund-Yates added. "This will have a strong read-across for profits.""

MY COMMENT

In other words......nothing is happening this week. Powell will talk....yet again......and will say the same things he has been saying for the past six months. Earnings will continue. A BIG YAWN of a week.....at least for long term investors. For short term traders....it will be a week of frantic attack on the markets gains by the trading community.

The usual....... nattering nabobs of negativism........(thank you Spiro Agnew)......above......Morgan Stanley and Bank America.

 

Of course.....we open negative today and have trended further to the down side. It has been decreed by the gods of Wall Street......the traders and AI Quants with their self fulfilling computer trading systems.

Fortunately over the longer term......the actual fundamental business results are what matters as shown by the ACTUAL DATA.

So....as usual.....I sit today and do nothing. This stuff makes me smile.....as usual. I love observing and watching human behavior.

 

I like this little article.

Hedge funds caught in bigger squeeze than 2021 meme stock frenzy - Goldman Sachs note

https://finance.yahoo.com/news/hedge-funds-caught-bigger-squeeze-133434194.html

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

"LONDON/NEW YORK (Reuters) -Hedge funds betting against stocks globally abandoned those trades last week at the fastest pace since 2015, surpassing the speed of their exodus from the meme stock frenzy two years ago, according to a Goldman Sachs research note.

The latest short squeeze, implying that stock prices rose so much that bearish bets become too expensive to hold, saw hedge funds caught out by a sharp rally in equities on Feb. 2 after the U.S. Federal Reserve slowed the pace of interest rate hikes and markets anticipated that rates would peak soon.

According to the Goldman note, seen by Reuters, the speed at which hedge funds exited bearish positions surpassed that seen in January 2021 when retail traders worked in concert to push shortsellers out of stocks such as videogame retailer Gamestop and movie theatre operator AMC Entertainment Holdings.

The 2021 buying frenzy of so-called meme stocks started on social media site Reddit, and at-home traders used retail trading platforms such as Robinhood to lift the price of heavily shorted stocks such as Gamestop. This forced many shortsellers out of positions and in some cases, funds restructured and returned money to their investors.

After a volatile two years, however, AMC and GME are now trading above their price levels of Jan. 15, 2021 just before the meme stock frenzy began.

Last week's short-squeeze followed a post-Fed rally. The tech-heavy Nasdaq surged 3.25% on Thursday - its biggest one-day jump in over two months - led by over 20% surges in orthodontic company Align Technology and Facebook parent company Meta Platforms.

That came just a day before a sharp selloff on Friday when stronger-than-expected U.S. jobs data sparked a selloff in world stocks.

Despite the massive short covering, hedge fund managers do not seem to be more upbeat about markets. "Positioning isn't 'high' and it doesn't seem like many investors are bullish, per se," JPMorgan's Positioning Intelligence said in a note reviewed by Reuters, adding it has also seen hedge funds adding some shorts in highly shorted stocks.

World stocks were last down 0.7% with Friday's strong U.S. jobs report renewing concerns that the Fed may have to remain aggressive in its monetary tightening to tame inflation.

Still, the main stock indexes remain up through Friday, led by Nasdaq, which was up by around 14% since the start of this year. Goldman Sachs that fundamental long-short hedge funds posted a gain of 3.79% in January, driven by their market exposure. Systematic long-short funds, which use algorithmic trading, were down 0.50%.

The largest short positions held by hedge funds were in industrials and information technology companies, the Goldman note said. It added that hedge funds also exited many long positions in Asian developing markets and Chinese equities last week.

Resurgent risk appetite among some investors has also fuelled rallies in the shares of so-called meme stocks since the start of this year, though many analysts are sceptical the recent moves will last."

MY COMMENT

Just a little bit about the short sellers and the other insiders. At least this little article shows that the worlds greatest traders with massive computing power and mathematical power are NOT.......prescient. They do not KNOW the future....even the short term future......in spite of all the things they do to legally manipulate the markets.

YES......we are in a new year and a new market......but....we are going to see plenty of times this year when the markets are DOWN. It is going to be a very erratic year. What will count is where we end up on December 31 when it is all over and in the history books.

 

Be careful boys and girls....it is dangerous out there.

‘Phishing-as-a-service’ kits are driving an uptick in theft: What you can learn from one business owner’s story

https://www.cnbc.com/2023/02/06/phi...ptick-in-theft-one-business-owners-story.html

"Key Points

• Small business owner Cody Mullenaux fell victim to cybercriminals who used sophisticated technology to convince him they were from the Chase fraud department and stole more than $120,000 in wire transfer scam.
• The criminals also tricked a Chase employee by successfully impersonating Mullenaux when they called to authorize the fraudulent wire transfers.
• Cybersecurity experts warn of uptick in sophisticated multiprong attacks using “phishing-as-a-service” kits. They predict the threat will only get worse this year.
• Scammers exploited regulatory loopholes resulting in Chase not being responsible to reimburse Mullenaux’s stolen funds."

AND

Criminals use Telegram to recruit ‘walkers’ as America’s big banks see an 84% increase in check fraud

https://www.cnbc.com/2023/02/06/cri...see-an-84percent-increase-in-check-fraud.html

"Key Points

• Check fraud, one of the oldest crimes in finance, is being supercharged by popular messaging platforms like Telegram, according to a cybersecurity expert.
• Banks saw an 84% increase in check fraud in 2022, according to the Financial Crimes Enforcement Network, a unit of the U.S. Treasury Department.
• A bank experts says security gaps in the USPS postal system coupled with a lack of prosecution in check fraud cases has allowed this crime to run rampant."

MY COMMENT

Some interesting detail in these articles for those that are interested. Unfortunately we now live in a world where you can not believe anything to do with money or any account. I get emails nearly every day that are some form of scam. We also get the usual scam and semi-scam phone calls on our land line....most of which we dont answer.

When I have to do a wire transfer......I verify to the extreme. I monitor bank accounts and credit card accounts daily. Over the past year I have had to cancel two different cards due to fraud. I was lucky to catch both on the first day.

In the past we had some check fraud. I was touring with the band.....and believe that someone in a motel stole one of my checks or at least the check account info. I found out it had happened when we suddenly had a number of checks....five to seven checks......all made out to Victoria's Secret....adding up to nearly $5,000. NO......my wife does not shop at Victoria's Secret.

These were actual paper checks that were used to buy merchandise in the store. It made me realize how incompetent the banks are with checks......since....these checks looked nothing like my checks, had the wrong address, were check numbers that had been previously used months in the past, and had a signature that looked nothing like mine. I did get the funds back.....with no BS from the bank.

My (facetious) question to my wife was......"ok, where is the $5,000 worth of sexy stuff from Victoria's Secret"......."why am I not seeing any of it.....what are you doing with it"?

 

ACTUALLY.......it is a good thing I am the one that handles the money....since it was my name on those fake checks. I would have come back from that tour to divorce papers....if my wife had seen that I was writing checks to Victoria's Secret for $5,000.

 

Emmett.....we have not done anything yet about the dishwasher. We are not real motivated since we eat out every day.

 

Looks like there is still some hope for today.....as the markets have significantly improved even though they are all still in the red.

Big jump in the Ten Year Treasury yield today....no doubt.....a big factor today in the morning going for the markets.

 

Sounds like a good role for you Emmett.......58-80 years old. Dont you dare say....."homeless"......if you want that part.

 

I have been busy today......no, not with the markets. I am in the very early stages of trying to get an American Impressionistic Art exhibition going with a museum. I suggested the Exhibition topic about 2 months ago to one museum and got shot down right away.

The second museum I tried.....actually my first choice.......has now moved to the point of wanting to meet with me and another person that I brought on board.......to discuss timing, fundraising, content, and other details. I am hopeful that there is now a little bit of momentum since one of the meeting participants will be the Museum CEO/President.........as well as museum Curators and staff.

Of course.....I have two paintings that I would like to see in this Exhibition if it happens.

 

As to the market today....which I did not watch through the day. I t ended much better than it started. I was still in the RED today....by a mild amount. I lost out to the SP500 by 0.12% today.

I did nicely have three stocks up today......TSLA, HON, and COST. It helps on a losing day to make some money in "about" 30% of my ten stocks.

 

This is coming.....it is just a question of when for each particular type of job.

Warn your children: Robots and AI are coming for their careers

https://thehill.com/opinion/technol...n-robots-and-ai-are-coming-for-their-careers/

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

"For five years or so, I have been running around as a pale imitation of Paul Revere, yelling, “The robots are coming! The robots are coming!” At schools, social settings, with family and friends, or even to complete strangers with whom I fell into conversations, I have uttered the same warning: “It’s critical that you or your children identify a career — now — that won’t be taken over by robots and artificial intelligence.”

My particular midnight ride started well before the pandemic reared its ugly head. But the pandemic may have planted a seed in the minds of certain CEOs that human beings are the weakest link on their chain to profit and prosperity.

When the first “Terminator” movie was released — eerily enough, in 1984 — the world was introduced to Cyberdyne Systems and its “Skynet” artificial superintelligence system, which not only gained self-awareness but realized it could do everything infinitely faster and better than its human creators.

Well, ever since that movie got people asking, “What if,” the fictional theme — and warnings about AI — have been morphing into reality.

The latest example of a technology poised to replace a human workforce is ChatGPT, the chatbot auto-generative system created by Open AI for online customer care. It is a pre-trained generative chat, which makes use of natural language processing, or NLP. The source of its data is textbooks, websites and various articles, which it uses to model its own language for responding to human interaction. Uh-oh.

It’s certainly not a stretch to believe that any number of CEOs might think, “Interesting… A self-teaching artificial intelligence system that won’t call in sick, doesn’t need to be fed or to take bathroom breaks, does not require health care, but can and will work 24/7/365.”

Not shockingly, it has been reported that Microsoft, which is laying off 10,000 people, announced a “multiyear, multibillion-dollar investment” in this revolutionary technology, which apparently is growing smarter by the day.

Pengcheng Shi, an associate dean in the Department of Computing and Information Sciences at Rochester Institute of Technology, warned in an interview with the New York Post: “AI is replacing the white-collar workers. I don’t think anyone can stop that. This is not ‘crying wolf.’ The wolf is at the door.”

Is ChatGPT coming for certain jobs in journalism, finance, software design, higher education and other fields that it can conquer? More and more people are starting to worry that it might be. Technology news outlet CNET acknowledged that it used ChatGPT to write more than 70 articles during a three-month “experiment with AI.” If a “still-learning” ChatGPT can write 70 articles, how soon before a more “educated” ChatGPT can replace human writers and pump out all the articles?

Sam Altman, CEO of OpenAI, has said his generative AI chatbot is still in its development stage, providing the world with “an early demo of what’s possible” in the future. “Soon,” he explained, “you will be able to have helpful assistants that talk to you, answer questions and give advice. Later, you can have something that goes off and does tasks for you. Eventually, you can have something that goes off and discovers new knowledge for you.”

Really? How many humans in America and around the world do those jobs now? And it’s not just white-collar jobs that may be at risk. What might become of humans who drive trucks, taxis, buses and delivery vehicles if researchers continue to perfect the field of self-driving vehicles? The same question goes for pilots — as in the UPS or FedEx partner airline agreement to purchase 20 pilotless cargo planes; or for ship captains, train engineers, and a multitude of other professions.

Science is making exponential advancements in the field of robotics and artificial intelligence. Surely, sooner or later, these advancements will impact most careers. The companies that produce or utilize such advancements might not be the sinister fictional Cyberdyne Systems, but if you don’t believe that these “amazing advancements in robotics and AI” don’t have the potential to eliminate hundreds of thousands of jobs in the near future, you may be the one who is living in a fantasy world.

So, while you can, sit down with your children and map out which career fields likely will be the least impacted by these evolutionary wonders. A disruptive fictional future could become a reality much sooner than we think. But then, AI already knows that."

MY COMMENT

In the future it is......US....that will be the drone. Sounds like we are headed toward the classic Science Fiction Movie theme where you have the Elites living in their luxury enclaves.......the few human bureaucrats that serve them......and the rest of the population....perhaps 80%.....living a day to day existence trying to eke out a basic substance living.

Humans that are kids right now and in for a very interesting 60-90 years of life ahead of them.

At my age.....not my problem.....sorry.

 

OMG.....is there anyone in the world that does not see the FED rate hike path?

Stock market news live updates: Stocks start week lower as investors ponder Fed's rate path

https://finance.yahoo.com/news/stock-market-news-live-updates-february-6-2023-111713832.html

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

"U.S. stocks fell Monday as investors faced another medley of earnings and evaluated the outlook for interest rates following January's blowout jobs report.

The S&P 500 (^GSPC) closed down 0.6%, while the Dow Jones Industrial Average (^DJI) edged a modest 40 points, or 0.1%, lower. The technology-heavy Nasdaq Composite (^IXIC) declined 1%.

Dell Technologies (DELL) said Monday it would eliminate about 6,650 jobs, or roughly 5% of its global workforce, making it the latest in a wave of technology companies to announce layoffs. Shares fell 3% on Monday.

In a memo to employees, co-Chief Operating Officer Jeff Clarke said the company is grappling with market conditions that "continue to erode with an uncertain future."

Elsewhere in stock moves, Bed Bath & Beyond (BBBY) shares spiked as much as 115%, rising above $6.50 as a recent rally in the meme stock gains momentum.

In other pockets of the market, the U.S. dollar edged higher for a third consecutive day after surging 1% following Friday's jobs report.

Oil prices rose, with West Texas Intermediate (WTI) crude up 1.4% to $74.40 per barrel.

The moves Monday come after stocks dropped in the previous trading session but closed higher for the week. Despite Friday's declines, equity markets have been on an uptrend this year. In 2023 to date, the S&P 500 is up 7.7% as of Friday's close, the Nasdaq 14.7% after rising for five straight weeks, and the Dow 2.4%.

Whether this momentum can be sustained will be a big focus of the week ahead, especially after the government's monthly jobs report showed payrolls rose by 517,000 last month. For investors, this dampened prospects the Federal Reserve may pause raising interest rates this year, an expectation that has fueled this year's rally.

"Job creation in January was eye-popping and contrary to the market narrative earlier in the week of the Fed not only pausing but reversing course and lowering interest rates later this year," BMO Wealth Management’s chief investment strategist Yung-Yu Ma said in a note. "Unless this labor market strength turns out to be a one-month blip, the hawks on the Fed are likely to dig in and keep rates higher for longer."

Investors will get more insight into the U.S. central bank's reaction to recent jobs data when Fed Chair Jerome Powell speaks at the Economic Club of Washington, D.C., on Tuesday.

"Looking ahead, the key question for markets is whether Powell's dovishness was intentional or accidental," the team at BofA said, adding that Powell may strike a more hawkish tone during his appearance this week. "We think the Fed's embrace of disinflation is genuine and it was always going to be difficult for Powell to send a hawkish message after decelerating the pace of hikes for the second time in as many meetings."

Meanwhile, even as the earnings season slows, Wall Street will have a docket of financials to parse through this week. Among names set to be most closely watched are Walt Disney (DIS), Uber Technologies (UBER), PayPal (PYPL), and PepsiCo (PEP).

The share of S&P 500 companies reporting positive earnings surprises remained flat over the past week, but the magnitude of upside earnings surprises decreased, largely driven by disappointing results from megacap technology giants, according to FactSet Research.

"As a result, the earnings decline for the fourth quarter is larger today compared to the end of last week and compared to the end of the quarter," FactSet's senior earnings analyst John Butters notes. "If the index reports an actual decline in earnings for Q4 2022, it will mark the first year-over-year decline in earnings reported by the index since Q3 2020.""

MY COMMENT

Just absolutely....RIDICULOUS. I have not seen ANY market indication of the FED lowering rates later this year. EVERYTHING I have seen from the FED is that rates will NOT be reduced this year after they top out in 2-3 months. This statement is detached from reality:

"Job creation in January was eye-popping and contrary to the market narrative earlier in the week of the Fed not only pausing but reversing course and lowering interest rates later this year."

So....if this is now driving the markets.....which I strongly doubt.....it is just temporary insanity. My view is it is trader talk setting up a straw man in the media and than crushing that straw man for their short term trading profits.