In the Pixar classic Finding Nemo, the characters Dory and Marlin were hovering over a trench, the black unknown below, and they had just lost their last hope of finding Marlin’s son, Nemo.
Just Keep Swimming ... Just Keep Swimming
Soundproof Markets
All eyes were fixated across several facets of policy this week: the U.S. military withdrawal and civilian evacuation in Afghanistan, the much-anticipated bargaining in Congress to pass the budget resolution and lastly Fed Chair Powell’s comments regarding the plans for removing the extraordinary accommodation put in place during the pandemic-induced recession.
The Song Remains the Same
Recent uncertainty due to the COVID Delta variant as well as concerns over the Federal Reserve tapering has resulted in a “risk off” market.
Synchronicity
With global governments and central banks providing liquidity at an unprecedented pace, you would expect global growth to be growing synchronously. But, as has been the case from the beginning of the pandemic, the virus and the multitude of government responses to combat the virus have varied from country to country.
Housing Bubble 2.0?
The residential housing market can be characterized as frenzied in many parts of the country, which begs the question — is it in a bubble?
Are We There Yet?
“Are we there yet?” is a familiar back seat refrain that often occurs during long, summertime road trips involving bored children and their beleaguered parents. As we transition through our second COVID-affected summer, this frustration is also felt by investors and other market participants who long for some return to “normal.” Surely, we must all be there by now, right?
Breakthrough Earnings
A week that began with the sharpest pullback in equities since last fall concluded in remarkable fashion, as investor concerns about the economic repercussions of rising COVID-19 infections gave way to an increasingly constructive second quarter earnings season.
A Quick Look Under the Hood
The S&P 500 is up over 15% this year and up almost 35% over the last 12 months. This week, the Dow Jones Industrial Average eclipsed 35,000 — another “round number milestone.”
What’s the Deal with Interest Rates?
As investors, it’s important to have a view of the world and what you think the economy is going to do in the coming months and years. This informs all investment decisions from which stocks to purchase to which asset classes to over-or-underweight.
Sign of the Times
Earlier this week, my family and I were out to dinner when we saw a sign on the front door of the restaurant that read: “Being short staffed is the new pandemic… Thank you for your patience with us.” While we are familiar with the standard “help wanted” signs, specifically in the service sectors industry, you may have noticed a recent addition to these signs: signing bonuses.
Summertime Blues
The Dog Days of Summer are here! In addition to the record heat waves expected to bombard the West Coast this weekend, we also await what typically occurs around this same time: equity market volatility and below average returns.
Exit Strategy
A year ago, Federal Reserve Chair Jerome Powell famously said, “We’re not even thinking about thinking about raising rates.” At this week’s Federal Open Market Committee (FOMC) meeting the Fed took its first tangible steps to lay the groundwork for a gradual removal of the stimulus measures enacted last year.
Hot Off The Press
Inflation, fast becoming the most dominant market and economic theme of 2021, has media and market commentators fixated on the topic, this blog included. In fact, this will be our fourth entry covering inflation in the past five weeks. While we apologize for “beating a dead horse,” we would be remiss if we did not provide our readers with further clarification on the subject.
Signs!
“Signs, Signs everywhere there are [help wanted] Signs,” is how the song goes. It’s the first Friday of the month, and that means the monthly payroll report is released by the Bureau of Labor & Statistics.
Easing Into Summer
A quiet week on Wall Street feels like just what the doctor ordered ahead of the long Memorial Day weekend. Stocks remain well bid and within striking distance of new highs ahead of what will be a busier week of economic data.
An Inflation Fixation
Both the financial and popular press have been inundated with headlines on inflation. Last week’s higher than expected Consumer Price Index (CPI) report added fuel to this fire. Given the elevated inflation measures reported the last two months, two questions rise to the fore: 1) Is the inflation we are all seeing temporary or long-lasting, and 2) How and over what timeframe will the Federal Reserve address it.
It Finally Happened...
Last year, when our economy began to emerge from the recession and to reopen, so too did concerns of inflation, even though it was below the Federal Reserve’s target interest rate of 2 percent.
The Writing on the Wall
“Tell me where earnings are going, and I’ll tell you where the markets are going” is common phrase you’ve heard from us over the years.
Inflection Points
Earlier this month in an interview with 60 Minutes, Federal Reserve Chair Jerome Powell indicated he believed the U.S. economy “seems to be at an inflection point” due to widespread vaccinations and previously enacted stimulus measures. He added his expectation that the economy would begin to grow “much more quickly” and that the pace of job creation would accelerate.
Error of the Estimates
First quarter earnings season shifted into high gear this week, transitioning from the big banks to blue chip companies ranging from Procter & Gamble and Johnson & Johnson to Intel and AT&T.