It IS too easy.....but....most people have no idea. Even if they read about this or see information....they dont accept it.....and end up making things way more complex than they need to be. Good old genetic based human behavior at work.
MORE good news for investors. Key Fed inflation gauge rose 2.8% annually in February, as expected https://www.cnbc.com/2024/03/29/pce...rose-2point8percent-annually-as-expected.html (BOLD is my opinion OR what I consider important content) "Key Points The personal consumption expenditures price index excluding food and energy increased 2.8% on a 12-month basis and was up 0.3% from a month ago, matching estimates. Core PCE was up 0.3% for the month and 2.5% at the 12-month rate, compared to estimates for 0.4% and 2.5%. Consumer spending shot up 0.8% on the month, well ahead of the 0.5% estimate. Personal income increased 0.3%, slightly softer than the 0.4% estimate. Inflation rose in line with expectations in February, likely keeping the Federal Reserve on hold before it can start considering interest rate cuts, according to a measure the central bank considers its more important barometer. The personal consumption expenditures price index excluding food and energy increased 2.8% on a 12-month basis and was up 0.3% from a month ago, the Commerce Department reported Friday. Both numbers matched the Dow Jones estimates. Including volatile food and energy costs, the headline PCE reading showed a 0.3% increase for the month and 2.5% at the 12-month rate, compared to estimates for 0.4% and 2.5%. Both the stock and bond markets were closed in observance of the Good Friday holiday. While the Fed looks at both measures when making policy, it considers core to be a better gauge of long-term inflation pressures. The Fed targets 2% annual inflation; core PCE inflation hasn’t been below that level in three years. “Nothing really super surprising. Obviously not the numbers the Fed wants to see, but I don’t think this is going to catch anybody off guard when they come back to work on Monday,” Victoria Greene, chief investment officer at G Squared Private Wealth, told CNBC. “I think everybody is going to pivot to labor pretty quickly and say well maybe if we see some weakness and cracks over here, this little stickiness in inflation and PCE isn’t going to matter as much.” Rising energy costs helped push up the headline reading, with a 2.3% increase. The food index edged up 0.1%. Inflation pressures came more from the goods side, which rose 0.5%, compared to the 0.3% increase for services. That countered the trend over the past year, during which services rose 3.8% while goods actually fell by 0.2%. Other upward pressure came from international travel services, air transportation, and financial services and insurance. On the goods side, the motor vehicles and parts category was the biggest contributor. Along with the inflation increase, consumer spending shot up 0.8% on the month, well ahead of the 0.5% estimate, possibly indicating additional inflation pressures. Personal income increased 0.3%, slightly softer than the 0.4% estimate. The release comes a little more than a week after the central bank again held its benchmark short-term borrowing rate steady and indicated it still has not seen enough progress on inflation to consider cutting. In their quarterly update of rate projections, members of the Federal Open Market Committee again pointed to three quarter-percentage point cuts this year and in 2025. Markets expect the Fed to remain on hold again when it releases its decision on May 1, then begin cutting at the June 11-12 meeting. Market pricing is in line with FOMC projections for three cuts, according to the CME Group’s FedWatch measure of futures market action." MY COMMENT Even though no one will say it......this is a GREAT report. It shows that the economy is operating in the GOLDEN ZONE. Inflation is perfectly in the normal range, consumers are active, and there is still some wage growth. The economy is EXACTLY where it should be. A perfect storm for earnings and business going forward.
On another question......why did I buy SMCI? A couple of reasons: 1. NVDA simply got too big in my portfolio. I dont want a single stock to be 30% to 50% of the total....even though I am a ride the wave person. So I took profits in the form of $50,000. Of course within a week or two NVDA was right back where it had been in terms of percentage of portfolio. 2. I put those funds into SMCI as a way to stay in a business that is intimately involved in the current AI BOOM......and....is part of the NVDA "family". I consider SMCI part of the NVDA......AI INFRASTRUCTURE. 3. I also like the fact that SMCI has participated in MASSIVE gains over the past year or two as part of that AI INFRASTRUCTURE......and I like their financial and fundamental prospects to continue to participate regardless of whether it is NVDA or some other company that is producing the chips going forward. 4. At $50,000 it is a small position. Being a very small position I was willing to make an aggressive semi-speculative buy......of a company that has good prospects to be a business leader in their market niche for a long time. 5. I believe the stock....SMCI....is a split candidate over the next 0-12 months as is NVDA. AND.....I AM NOT recommending that anyone else buy SMCI. I will evaluate this little experiment in a year or two and see it it is worth continuing.
A little weekend real estate update. I agree completely with this view. It mirrors my view which I have expressed many times on here over the past six months. Once rates drop to about 6% in the mortgage markets....house values in superior markets will be off to the races. Mortgages between about 5% to 6% will kick off an epic housing battle as buyers flood into the markets and fight for homes in a low inventory environment. Shark Tank' star Barbara Corcoran reveals when housing prices ‘will go through the roof’ When the Fed lowers rates, people ‘come out and buy,’ says The Corcoran Group founder https://www.foxbusiness.com/real-es...-corcoran-reveals-housing-prices-through-roof
YOUR guess is as good as theirs.....probably better. Stocks just had their best first quarter in 5 years — here's where strategists think the market is headed https://finance.yahoo.com/news/stoc...sts-think-the-market-is-headed-113742174.html MY GUESS......year end SP500.....5700.
The week to come. March jobs report kicks off new quarter: What to know this week https://finance.yahoo.com/news/marc...quarter-what-to-know-this-week-121817778.html (BOLD is my opinion OR what I consider important content) "Stocks closed out a stellar first quarter last week. This week's jobs report will help determine if the momentum will continue. The S&P 500 (^GSPC) rose more than 10% in the first three months of the year, its best start to a year since 2019. Meanwhile the Nasdaq Composite (^IXIC) popped over 9% and the Dow Jones Industrial Average (^DJI) gained about 5.5% in the period. Updates on the labor market will highlight the first trading week of the new quarter. Fresh readings on job openings, and wage data will preface the biggestheadline of the week: The March jobs report, which is due out Friday morning. Updates on activity in the services and manufacturing parts of the economy are also on the economic calendar. On the corporate side, results of a pivotal shareholder vote in Disney's proxy battle with activist investor Nelson Peltz are expected on Wednesday, assuming the two sides don't reach a deal beforehand. Labor market report card The Fed's preferred inflation gauge, the Personal Consumption Expenditures (PCE) excluding energy and food, increased 0.3% month-over-month in February. At a San Francisco Federal Reserve conference, Fed chair Jerome Powell called the reading "more along the lines of what we want to see" and said that the job market and the economy are strong right now. "That means that we don't need to be in a hurry to cut," he said. In the week ahead, focus will shift to whether that characterization of the economy holds up. With the Fed committed to holding rates higher until it sees that confidence, all eyes have turned to the labor market where continued resilient data has economists hopeful inflation can fall to 2% without the economy slipping into recession. The March jobs report is expected to show 216,000 nonfarm payroll jobs were added to the US economy last month with unemploymentfalling to 3.8%, according to data from Bloomberg. In February, the US economy added 275,000 jobs while the unemployment rate hit 3.9%. And, largely, economists don't expect there to be any signs of cracks in the strong labor market story. "For Friday's employment report, we're expecting that the jobs numbers will carry on with the strong momentum of the last few months," Jefferies economics team, led by Thomas Simons, wrote in a research note on Thursday. "The revisions have been extreme lately, and the composition of payrolls has been less encouraging than it was throughout 2023, but we have not seen enough evidence in the peripheral labor market data to make a case that job growth is going to fall off a cliff." A battle to watch The fate of Disney's (DIS) board will be determined this week following activist investor Nelson Peltz's months-long battle for a boardroom shakeup. On Wednesday, investors will know if he won. The results of the shareholder vote are expected to be announced at the entertainment giant's annual stockholders meeting. As Yahoo Finance's Alexandra Canal reports, it's a critical moment for Disney as the company navigates consumers' shift away from traditional cable packages into mostly unprofitable streaming services. The company also faces succession questions with CEO Bob Iger's contract set to expire at the end of 2026. Peltz is seeking board seats for himself and former Disney CFO Jay Rasulo. Peltz's hedge fund Trian Fund Management beneficially owns $3 billion of common stock in Disney. The rally may need 'digestion' Last week, we noted how some signs of investor sentiment are showing there may be more room for risk to flow into the market. But other indicators are flashing that the market's rip higher may be due for a break. In a research note on Thursday, Citi's equity strategy team noted the Levkovich Index, which uses 11 different inputs to measure investor sentiment, has entered "euphoria" for the first time during this bull market run. Citi US equity strategist Scott Chronert wrote in a note to clients that the index triggered euphoria after increases in margin debt and short activity in markets, among other factors, pushed the reading higher. Typically, this trigger aligns with a lower probability ofabove average returns, per Chronert. But he warned the index was "not designed to be a short-term timing tool. "A catalyst may still be needed to slow gains," Chronert wrote. "Exhaustion may not be enough." Chronert told Yahoo Finance that the index is showing sentiment has become far more constructive over recent months amid the rally, and a period of "digestion" for markets could be expected soon. "You have to acknowledge that you're kind of chasing sentiment," Chronert said. "There is a clear FOMO, fear of missing out, dynamic going on, that we've seen in the flows data. And we're just trying to be a little bit more balanced in how aggressive to be right now." He added: "It doesn't mean the big story is over. It just it just means that you have to respect that it does take some time from the fundamentals to grow into the price action."" MY COMMENT Personally I dont see any indication of......euphoria.....at all. I see the opposite. I have rarely seen such negative and skittish sentiment and market action in the middle of a roaring bull market before. It is like everyone is cowering in the corner waiting for some big monster to jump out. I see the markets as afraid of their own shadow right now. AND.....of course.....we still have MASSIVE money sitting on the sidelines in the form of........$6TRILLION dollars. We are in a market that is.......schizophrenic. It is the psychosis of the short term versus the reality of the long term. Investors are either short term traders or foolish market timers.....or......they are long term buy and hold. There is nothing in-between. I attribute much this to the younger investors thinking that the way to invest is market timing and trading. Of course the institutions and big boy banks are more than willing to use this and news headlines to push their micro -second.....news headline driven....AI program trading. As to the jobs report.....you can try to hype that as some major economic news but it is NOT. It is a big fat nothing-burger. In addition, you cant trust those numbers in the slightest.....no doubt they will be revised significantly in the near future.....as usual. So in other words......investor skittishness will continue. The slightest rumor or little meaningless event will send people running for cover.....for a day or two. Of course this is IDIOCY. AND.....there is really NOTHING going on in the coming week. Market direction and bias continues to be to the UP side......but.....with the skittishness on the part of short term people and institutions that micro-trade on the headlines......there is some continued possibility of a little period of consolidation to continue. Either way I will take it. What choice do i have anyway......as a long term fully invested, all the time, long term investor.
A nice little.....normal.....open today. Now lets see if the markets and long term investors can withstand the relentless short term attacks that happen all day long every day as the media fear-mongers for clicks. After the past 2-3 weeks of consolidation and market skittishness....we are due for a nice little bump up as the bull market continues to move forward. Will it happen this week? Who knows......but it will happen. We are now in the forth month of 2024 and looking good. In the old days......April was a very good month for investors as IRA holders made their contributions by the April 15 deadline. This little market bump does not happen anymore since the 401K has now totally eclipsed the IRA and the April 15 deadline does not apply much anymore as a result.
It took us over two years for the economy to recover from all the pandemic distortions and disruptions. BUT....we are rolling along now. Remember all the talk of a recession a year or two ago? US manufacturing sector grows for the first time in 1-1/2 years https://finance.yahoo.com/news/us-manufacturing-sector-grows-first-140339501.html (BOLD is my opinion OR what I consider important content) "WASHINGTON (Reuters) - U.S. manufacturing grew for the first time in 1-1/2 years in March as production rebounded sharply and new orders increased, but employment at factories remained subdued and prices for inputs pushed higher. The Institute for Supply Management (ISM) said on Monday that its manufacturing PMI increased to 50.3 last month, the highest and first reading above 50 since September 2022, from 47.8 in February. The rebound ended 16 straight months of contraction in manufacturing, which accounts for 10.4% of the economy. That was the longest such stretch since the period from August 2000 to January 2002. A PMI reading above 50 indicates growth in the manufacturing sector. The ISM and other factory surveys had grossly overstated the weakness in manufacturing, which has been constrained by higher borrowing costs. Government data on Thursday showed manufacturing output rising at a 0.9% annualized rate in the fourth quarter. It grew 1.6% in 2023 compared to 0.8% in 2022. Economists polled by Reuters had forecast the PMI rising to 48.5. Though consumer spending has shifted to services, demand for goods remains supported. The ISM survey's forward-looking new orders sub-index increased to 51.4 last month from 49.2 in February. Output at factories rebounded, with the production sub-index surging to 54.6 from 48.4 in the prior month. There was no sign of supply chain constraints from attacks on international shipping in the Red Sea by Yemen's Houthi militants. The survey's measure of supplier deliveries slipped to 49.9 from 50.1 in the prior month, with a reading below 50 indicating faster deliveries. Nonetheless, inflation at the factory gate picked up. The survey's measure of prices paid by manufacturers rose to 55.8 from 52.5 in February. Factory employment continued to contract, though at a moderate pace. The survey's measure of manufacturing employment increased to 47.4 from 45.9 in February. This measure has, however, not been useful in predicting manufacturing payrolls in the government's closely watched employment report." MY COMMENT GOOD NEWS for the economy and in my view earnings going forward. We are in the GOLDEN ZONE of the economy right now and will be for some time to come. As to employment in the manufacturing sector.......contracting....of course. Employers will do anything they can to avoid having to hire more employees by using tech, robotics, and AI to do the job. You cant blame them........machines and tech are much more productive and dont come with all the high cost government mandates and regulations that are attached to human workers.
As to the above and replacing employees with tech and AI. A 15-year problem that has plagued corporate America is finally turning around https://finance.yahoo.com/news/a-15...rica-is-finally-turning-around-141822989.html (BOLD is my opinion OR what I consider important content) "American workers are becoming more productive. Recent analysis from Bank of America showed the average revenue per worker for companies in the S&P 500 hit an all-time high in Februaryafter 15 years of no gains. This is one of several signs that labor productivity is rebounding after slumping in 2022. Some on Wall Street think the developments in labor productivity could help the stock market survive stickier-than-expected inflation that has emerged as a concern in recent weeks. "If productivity goes higher, then [companies] are able to cut costs, improve margins, things like that," Bank of America US and Canada equity strategist Ohsung Kwon told Yahoo Finance. "That's why companies are so focused on improving productivity. There's a lot of macro headwinds happening. So they are trying to find ways to improve productivity and sort of offset those headwinds." The headwinds Kwon references include the risk the Federal Reserve holds off on cutting interest rates as inflation's path downward continues to prove bumpier than initially hoped. Two separate reports released this week showed inflation was hotter than economists expected in February. And annual wage growth during the month was higher than what economists have said the Fed wants to see to feel confident inflation is moving down to its 2% target. The research team at Carson Group argues an increase in productivity could offset these concerns, though. "With productivity soaring like it is and will hopefully continue like it can, you don't have to worry about inflation coming back, you really don't," Carson Group chief market strategist Ryan Detrick told Yahoo Finance. Detrick's colleague Sonu Varghese explained that persistent wage growth can usually cause an inflation problem if consumers have more money to spend on goods. Demand for goods would rise as workers make more money, therefore pushing prices higher. This paradigm shifts, though, if productivity picks up. In that instance, the economy could sustain higher wages because companies would also be producing more goods. If both the demand and supply of goods pick up, then prices can remain stable. Varghese highlighted two different instances where wage growth surged. In the 1970s, wage growth picked up, but productivity didn't, leading to a decade-long battle with persistent inflation. In the 1990s, wage growth gains were met with a productivity boom and subsequently led to a prosperous stretch for both US economic growth and stock market gains. As productivity picks up, it increases the overall trajectory of the US economic growth, Renaissance Macro head of economic research Neil Dutta told Yahoo Finance. That's welcome news for stocks. Companies can choose to use their increased financial gains from productivity in a variety of ways. One would be to keep boosting wages to lure in more workers. But recent shifts in the labor market show that likely won't be the case. The labor market has shown some signs of softening, and the large pay bumps needed to lure workers into the post-lockdown job market have eased. The quits rate, a sign of confidence among workers, hit its lowest level since August 2020 in January. This would indicate that companies would take their additional revenues from increased productivity and use them to boost margins. Higher margins are usually a tailwind for future company earnings, which would in theory lift equities. All of this comes without a mention of artificial intelligence, which has been lauded as a potential productivity booster. "AI is kind of like the cherry on the top," Kwon said. "AI obviously is going to be a huge productivity enhancer. I don't know when that's going to happen. But we do think that is going to happen and be a huge boost to productivity as well." MY COMMENT MORE good news for business.....and for investors. BUT....NOT good news for workers. I suspect that virtually ALL of this gain is due to two factors: 1. The continued bringing in of blue collar and white collar foreign workers at lower wages. BINGO....greater productivity......as a result of lower wages and the FACT that these workers tend to be contract workers and that frees the company from paying for benefits, Social Security, retirement, etc, etc, etc at the higher rate that would apply to actual company employees. 2. The invasion of AI and TECH into the workplace. Less human workers and more machines.....is equal to greater productivity. These two factors are great news for investors and no doubt are a long term trend that will only increase gong forward. As to workers....especially AMERICAN workers.....BUMMER.
That is about it for any sort of financial news today. Fine with me. The less the better. I would be happy if the financial news was nothing more than fundamental economic and business data. BUT......those days are long gone. AND as to the markets......the DOW and SP500 are now in the red. The NASDAQ is hanging in there with a small......0.13% gain for the day. Meaningless....of course.....when it comes to long term investing.
Here is the real reason for the short term....meaningless.....market action that we are seeing today. The Ten Year Yield is up to 4.327% now. Treasury Yields Extend Climb After Strong ISM Factory Gauges https://finance.yahoo.com/news/treasury-yields-extend-climb-strong-143616691.html
What really counts.....EARNINGS. It seems like they just ended....but....here we go again. The BIG BANKS will kick it all off as usual when they start to report about the second week of April. Earnings will start to hit it hard about the week of April 22. It is anticipated that META, GOOGL, MSFT, AMZN, and many others will report that week. AAPL and SMCI are expected to report the week of April 29. PLTR the week of May 13 and also HD. NVDA is expected around May 22......and....COST around May 30. Of course right now all these dates are tentative. CUE.....all the negative.....so called....."experts".
A very small loss for me today....even with five of nine stocks up. Up were.....GOOGL, SMCI, MSFT, AMZN, and NVDA. The two stocks that killed me today were COST and HD.....both had a very poor day today. The one saving grace......I beat the SP500 today by 0.04%. A waste of a perfectly good day today.
I like this little article. Weekly Market Pulse: Don’t Just Do Something, Sit There https://alhambrapartners.com/2024/0...se-dont-just-do-something-sit-there/?src=news (BOLD is my opinion OR what I consider important content) "The first quarter of 2024 is in the books and the US economy and markets continue to defy expectations, which coming into this year were that growth and inflation would both moderate and the Fed would be able (or forced, depending on how much things slowed) to cut interest rates 0.25% as many as six times this year. In fact, at the beginning of this year there was a better than 50% chance the first cut would come in the month we just ended. That, of course, didn’t happen because while real growth and inflation both likely slowed in the first quarter (we don’t have all the data yet), it wasn’t enough to get the Fed too excited. The consensus opinion in the last two years has been that a recession was/is just around the corner and it has been nothing if not consistent – and wrong. And it still is. In markets, the narrative all year has been about how the market is only going up because of the “magnificent seven” and most stocks were not participating in the rally. That turned out to be dead wrong too. Of the magnificent seven, 4 outperformed the S&P 500 while 3 underperformed, with two of them – Apple and Tesla – actually losing money for the quarter. The NASDAQ 100 also underperformed the S&P 500. Magnificent Seven The best performing sectors in the quarter were decidedly not technology but they were magnificent for those who owned them. Energy stocks were the leaders as oil prices rose strongly in the quarter, lower crude oil demand being another consensus opinion taken out behind the woodshed during the first three months of the year. Financials and industrials outperformed as household names like Berkshire Hathaway, JP Morgan, Bank of America, Wells Fargo, American Express, GE, and Caterpillar* all outperformed the S&P 500 and most of the magnificent seven to boot. Digging down to the industry level, homebuilders had another good quarter and insurance stocks handily beat the market. Other asset classes also produced solid gains. Gold and commodities both rose while small and mid-cap stocks also had solid quarters. About the only losers were bonds and REITs, both down in a rising rate environment. Even so, the losses were minimal as the rise in rates was modest. Asset Class Returns As we enter the second quarter, the outlook for investors is highly reliant on the evolution of the economy for the balance of the year. We watch bond markets for clues about future real growth and inflation. Both the 10-year nominal Treasury yield and the 10-year TIPS yield moved higher in the quarter which means that nominal and real growth expectations both rose during the quarter. Nominal rates rose more though so it was really inflation expectations that rose the most. 10-year breakeven inflation moved up 16 basis points during the quarter and is now at 2.32%. Real growth appears to be rising at about trend as indicated by the CFNAI released last week. The monthly reading rose to 0.05, barely above trend which is represented as 0 in this series. The 3-month average actually fell slightly but at -0.18 shows an economy growing slightly below trend. The current Atlanta Fed GDPNow has Q1 growth at 2.3%, which is a step down from the 4.9% and 3.4% of the last two quarters but still right around the long-term trend of 2%. Inflation expectations have risen somewhat because the rate of decline appears to have stalled a bit during Q1. We got the February reading on the PCE price index (the Fed’s preferred measure) last week and while the February readings were about as expected, January’s reading was revised higher. Part of the reason prices aren’t falling as rapidly as they were is the rise in gas prices (futures up nearly 30% in Q1) but the rest of the inflation narrative is basically wrong. The perception is that food and gas prices are causing inflation which not only gets the causation backwards but is mostly wrong. Inflation has been driven since last year by the rise in services prices which are up 3.8% over the last year. Goods prices are down 0.2% year-over-year. Much of that is from durable goods (things that last at least 3 years) which are down 2% over the same time frame, but non-durables (which includes food and energy) are only up 0.8%. PCE prices ex-food and energy are up 2.8% year-over-year, which is still higher than the Fed would like. PCE prices ex-food and energy PCE Goods prices PCE Durable Goods prices You’ll notice that durable goods prices have been falling since the mid-90s so a return to negative territory is just a return to the normal state of affairs. This trend is long established and likely a function of increasingly free trade after the signing of the first NAFTA. If you want to know the consequences of imposing ever more trade barriers, here is a partial answer. To the degree that goods are not able to avoid or evade the tariffs, prices will rise. But the key to that line of thinking is the avoid/evasion part. We know that China and other countries take action to minimize the impact of the tariffs including moving production to (or routing products through) countries not subject to the tariff. That’s one reason our imports from Mexico and other countries not named China are rising so rapidly. And by the way, China is, right now, ramping up production of goods in an attempt to fill the hole in their economy left by their imploding home building industry. I’d venture to say that goods prices aren’t going to suddenly become a problem. Services inflation is being driven by housing costs which rose 7.6% in 2023. Housing, as reflected in these price indexes, lags the real world and we know that rents have at least stopped rising in most places; in some areas, rents are actually falling. While it takes some time for this to be reflected in the inflation data, it does appear quite likely that services inflation will continue to moderate. We know, for instance, that the inventory of existing homes for sale is finally rising which should help to ease pressure that has kept home prices rising. The Case-Shiller home price index for January, released last week, showed prices falling by 0.1% month-to-month and up 6.6% year-over-year. New home prices are actually down over the last year. The price of the median new home is down from $496,800 in October of 2022 to $400,500 in February of this year. Have house prices peaked? Maybe. The consensus about the economy now is that it will still slow and the Fed will be able to cut rates at least twice and there is some probability of up to four cuts. I suppose if inflation continues to come down, two cuts might make sense but frankly, I’m not sure the Fed needs or wants to do anything. The current 10-year Treasury rate is about average since 1990 and that includes the period of exceptionally low rates after 2008. This is normal and there is no reason to believe the economy can’t function with normal interest rates. It takes time for people to adjust but they are doing so, even in the housing market, where existing home sales are up 12% over the last three months (through February) and new home sales are up nearly 9%. There are some early signs that the economy is starting to re-accelerate as production picks up to replenish inventories that have been flatlining for over a year. Personal consumption expenditures, reported last Friday, rose more than expected and the majority of that was due to services, but goods rose too so maybe the nascent recovery in production will catch. If it does and we get better real growth along with a further moderation of services inflation, that would be about as good as it gets for investors. I wouldn’t be shocked by such an outcome but then I’m rarely shocked by anything that happens in the economy or markets. What’s happened since the beginning of the year isn’t what was expected. The Fed may not need or want to cut rates but that isn’t bad news. The market’s climb wasn’t concentrated in a few stocks and that isn’t bad news either. Nothing went the way the majority expected and yet the diversified investor did just fine. My advice is to keep calm, make no sudden moves, and enjoy it. MY COMMENT The above sounds about accurate to me. Especially the part about interest rates being in the........"NORMAL".....zone. It is INSANE how the media and others attempt to make it sound like what we are seeing now is some sort of high interest rates that are an issue. BUT.......I guess IGNORANCE of history and reality creates the.....new reality.
I like this little article. Housing's outsized role in the Fed's inflation problem: Morning Brief https://finance.yahoo.com/news/hous...nflation-problem-morning-brief-100031015.html (BOLD is my opinion OR what I consider important content) "The Federal Reserve's inflation story is all about housing. Right now, the gap between the Fed's preferred inflation measure and the most popular inflation measure is a full percentage point. But how the two series account for the cost of shelter yields a 1.5 percentage point gap between them — a difference that's offset by other components to its current gap at the bottom of the ledger. In a new report out Monday, the economics team at Wells Fargo led by Sarah House and Aubrey George explored the gap between two closely watched measures of inflation — core CPI and core PCE. Last Friday, while markets were closed for Good Friday, new data showed the "core" Personal Consumption Expenditures (PCE) price index — which excludes food and energy — rose 2.8% over the prior year in February. Earlier in March, the "core" Consumer Price Index (CPI) reading showed prices were up 3.8% over last year in February. The Fed targets 2% inflation and focuses on the core PCE measure. Wells Fargo notes the spread between these two series typically stands at around 0.3%. The yawning gap between the two series — one of which makes the Fed appear very far away from its goal and another that puts the central bank on track to meet this goal — is of particular interest to investors looking to nail down the timing of the Fed's move to cut rates. And the current issue is about weight rather than measurement. In the CPI, housing costs are about 43% of the core measure. For PCE, housing costs are 17.5% of the core measure. As of February, CPI housing costs were up 5.9% year over year. PCE housing costs were up 5.8% year over year. As Yahoo Finance's Dani Romero reported last month, the lagging impact of lower market rents and the frequency with which the BLS collects this data have, in part, kept shelter costs elevated and inflation high. And as we noted last month, Fed Chair Jerome Powell has been clear in asserting the Fed is not "targeting housing price inflation, the cost of housing, or any of those things." Which means the Fed will just have to wait it out. On Friday, Powell said the February PCE report was "not as low as most of the good readings we got in the second half of last year, but it's definitely more along the lines of what we want to see." The team at Wells Fargo said the gap between CPI and PCE "does not appear to be a major source of consternation among Fed officials." Still, the firm notes this spread "could make the FOMC's job of returning PCE inflation to 2% a little harder on the margin." But as with most things in life, the longer it takes the Fed to reach its inflation goal, the more likely it is a surprise emerges to upset these best-laid plans. Monday served as another example, as strong manufacturing data showed prices paid — a measure of input inflation for manufacturers — reached nearly a two-year high. In response, the odds for a June rate cut fell back below 50%. Suggesting maybe the Fed's inflation problem isn't only a housing problem after all." MY COMMENT We need to look at "general" inflation.......and.....take into account specific individual components that may be distorting the general figure. Oil and housing are the culprits. REALITY.....inflation right now is in the NORMAL range.
Interest rate freak-out today. So the markets are a total waste of time. Every stock down for me right now. Short term INSANITY....as usual. Dow sinks nearly 400 points, yields rise to 2024 highs https://finance.yahoo.com/news/stoc...ints-yields-rise-to-2024-highs-133258500.html
What we are seeing today and recently with interest rates and the markets is simply meaningless BS. There is absolutely ZERO rational or fundamental reason for the BIG CAP GROWTH stocks to be tied to rates in any way. BUT....that is the short term reality....even if it has ZERO connection to any reality. So....it is time for the next few days to sit and do nothing. This is simply the markets looking for an excuse to freak-out while awaiting earnings. NOTHING....has changed with the FED or POWELL.....all of this is simply the experts and traders....creating an irrational impact on the short term rates. it is a market....HISSY FIT. I WANT MY RATE CUTS AND I AM GOING TO STOMP MY FEET AND HAVE A FIT. Of course NONE of these people have any clue when or if rate cuts are going to happen. NO....nothing has changed in the slightest. MORONS at work.
I am sure the short term bond traders just LOVE the bond trading markets over the past couple of weeks. They just love to push all the stuff we are seeing in the news lately.....legally.....to jazz up their trading. BUT.....in spite of all the BS lately....here is what the FED has to say. Fed’s Mester and Daly expect three rate cuts this year https://finance.yahoo.com/news/feds-mester-and-daly-expect-three-rate-cuts-this-year-161204891.html
