Wednesday , October 27 2021
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Tag Archives: Alhambra Portfolios

Weekly Market Pulse: I Have Questions

The wise man is one who knows what he does not know. – Lao Tzu or Socrates or neither   It ain’t what you don’t know that gets you in trouble. It’s what you know for sure that just ain’t so. – Mark Twain or Josh Billings or Artemus Ward or none of the above   Stocks are at all-time highs, credit spreads are as narrow as they’ve ever been, and someone just paid $24 million for some cartoons of apes:   LONDON, Sept 9 (Reuters) – A...

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Weekly Market Pulse: Windshield Investing

The economic slowdown we’ve been writing about for months officially arrived last Friday in the form of a particularly weak employment report. The number of new jobs created last month – or at least the WAG the BLS makes at such things on a monthly basis – was a mere 235,000 or roughly a cool half-million less than expected by economists who insist on trying to guess this random number on a monthly basis. There was hand wringing and pearl clutching all over the financial...

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Weekly Market Pulse: The Illusion of Control

Jerome Powell delivered his long anticipated speech at Jackson Hole last week. Well actually, I have no idea if he was actually in Jackson Hole since the speech was delivered electronically, another victim of the delta variant. The virus itself rated barely a mention in Mr. Powell’s remarks and I think that is probably as it should be. There has been some economic impact from the recent virus surge but nothing like previous versions. COVID may not be over, but we are learning to live...

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Weekly Market Pulse: All or Nothing Investing

This week marks a change in our economic environment or at least our perception of it. Last year, post-COVID onset, we characterized the environment as one marked by a falling dollar and improving growth. To be exact, that is the environment the markets reflected; interest rates were rising, the yield curve was steepening and the dollar was falling. That changed somewhat at the beginning of the year when the dollar stopped falling and we shifted to a neutral dollar stance. Then, in the...

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Weekly Market Pulse: Happy Anniversary!

Today is the 50th anniversary of the “Nixon shock”, the day President Richard Nixon closed the gold window and ended the post-WWII Bretton Woods currency agreement. That agreement, largely a product of John Maynard Keynes, pegged the dollar to gold and most other currencies to the dollar. It wasn’t a true gold standard as only other countries that were party to the agreement could demand gold in exchange for their dollars, but it was at least a standard of some kind. Nixon...

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Weekly Market Pulse: Trading Places

They’re out there panicking right now. I can feel it. They’re out there. They’re panicking. Look at them. – Eddie Murphy as Billy Ray Valentine in Trading Places I thought of that scene the other day when a good friend in the investment business told me that investors today are panicking into the market rather than out as they were last spring. I have to say, I find it hard to disagree with him but I think there are specific parts of the market where panic is more...

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Weekly Market Pulse: Buy The Dip, If You Can

If you were waiting for a correction in stock prices to put some money to work, you got your chance last week. The Dow Jones Industrial Average was down nearly 1000 points at the low Monday and closed down 725, a loss of a little over 2%. The S&P 500 did a little better but closed down 1.5%. It looked like the beginning of a beautiful correction, one for which we were way overdue. The reason everyone gave for the selloff was fear of the Delta variant, of which new cases and...

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Weekly Market Pulse: As Clear As Mud

Is there anyone left out there who doesn’t know the rate of economic growth is slowing? The 10-year Treasury yield has fallen 45 basis points since peaking in mid-March. 10-year TIPS yields have fallen by the same amount and now reside below -1% again. Copper prices peaked a little later (early May), fell 16% at the recent low, and are still down nearly 12% from the highs. Crude oil has recently joined in, falling 7% from its recent high. Energy stocks are in a full-blown correction,...

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Weekly Market Pulse: Contrasts & Contradictions

Six months ago, the US was still reporting 226K new cases of COVID a day, a rate that would peak in the first half of January at over 300k. Daily deaths also peaked in those first two weeks of the new year at over 4000. The economy was still struggling to recover, most restaurants surviving on takeout traffic, and no one was even talking about going back to the office. The S&P 500 was nearly 600 points lower and the 10-year Treasury was yielding less than 1%. The 2-year note was about...

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Weekly Market Pulse: Who’s The Boss?

I told you last week that there were strange things going on in the labor market but I had no idea how much of an understatement that really was. Much of last week’s economic focus was on the inflation report but I think the JOLTS report may turn out to be more significant. Inflation was indeed pretty hot year over year but that wasn’t unexpected. It wasn’t all about base effects either, as our Jeff Snider pointed out. The bond market reaction to the CPI report was not as...

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