Wealth and Asset Management for You

In a classic case of “the market knows more than you,” the recent strength in growth stocks and weakness in interest rates led to a whopper of a reporting week…

August 12, 2022 – Finally, some significant movement with respect to inflation data that is clearly turning the corner and quickly. This is but one month’s worth of declines, but forward indicators continue to point towards inflation having peaked. After a 20%+ Nasdaq bounce in just two months, how much meat is left on the bone?Read More

Stocks gave up ground yesterday in a quiet session in front of today’s scheduled CPI report. Some of the more speculative NASDAQ stocks that had experienced sharp rebounds since the…

August 10, 2022 – This morning’s headline CPI numbers were lower than expected igniting a rally, but shelter costs continue to rise strongly. Last Friday’s employment report shows wages rising well over 5% annualized. The Fed still has a lot of work to do. It’s encouraging that inflation forces may be starting to ebb, but one favorable CPI report isn’t going to change the Fed’s strategy, at least not for now.Read More

Stocks were volatile with little change last week after a super strong July. Friday’s surprisingly strong employment elicited greater reaction in the bond market than the stock market. Good employment…

August 8, 2022 – The Deficit Reduction bill does absolutely nothing to reduce inflation, at least not over the next few years. What it does do is institute a wealth tax by taxing stock repurchases made with funds that have already been taxed at least once. A 1% tax on repurchases may sound inconsequential, but don’t believe Congress will stop at 1% once the first tax is implemented. It’s a tax consumers and shareholders never see directly, therefore the most palatable to Congress, But not to shareholders.Read More

Stocks consolidated yesterday and for much of this week. Following a 14% bounce higher in the S&P and a 17% pop in the growthier Nasdaq over a 5-week period, this…

August 5, 2022 – As markets consolidate a massive spike off June lows, we reassess what the future holds. Bearish news in June was followed by incremental positives in July. Earnings are still advancing, inflation is peaking, and valuations have normalized. The Fed and inflation remain wild cards but the worst is likely behind us unless incoming data is much worse than expected. Jobs take center stage this morning.Read More

Stocks fell more than 1% as global tensions rose coinciding with Speaker Pelosi’s visit to Taiwan. So far, the Chinese response has been measured but that could change at any…

August 3, 2022 – Markets fell in fear of Chinese retaliation to Speaker Pelosi’s trip to Taiwan, but reactions to political surprises tend to be short-lived. The focus quickly should return to the economy and inflation. While Fed officials try to speak in a more hawkish tone, their crystal balls are rarely clearer than that of the average investor. The path of economic decline (if any) and inflation will dictate how the market goes from here. The good news is that inflation has peaked allowing the Fed to take some pressure off the brakes in coming months. When it stops, markets will celebrate. In fact, they should start to celebrate before the Fed Funds rate peaks.Read More

Stocks rose again Friday capping the strongest month for equities since April 2020 as the country was in Covid-19 lockdown. Coincidentally, June was the worst month this year, just as…

August 1, 2022 – The worst month of the year (June) was followed by the best month in two years. What changed? Market reaction to generally mediocre earnings reports suggests markets had caught up with a decelerating economic picture. Furthermore, markets now see the Fed decelerating its pace of future interest rate increases with cuts beginning next year. That may prove right, but can the Fed succeed with unemployment below 4%? We will learn that answer over the coming months.Read More

Another Fed meeting yielded another aggressive bounce for stocks on Wednesday, following a slew of earnings reports that helped recoup recent losses. Chairman Powell and the team recognize that a…

July 29, 2022 – While the Fed follows their script dictated by market conditions, Chairman Powell offered hope that rate hikes going forward won’t be as strong as the 200bps implemented in the past three months. Markets extended their rally following his speech and followed through yesterday. With the Fed not meeting until September, earnings take center stage.Read More

Stocks fell across the board yesterday as fears of recession rose. Bond yields fell. Today marks the conclusion of the Fed’s FOMC two-day July meeting. Anything but a 75-basis point…

July 27, 2022 – The FOMC meeting today will tack on another 75 basis points to the Fed Funds rate. Starting in July, it is clear that inflation is starting to ebb, but we don’t yet know how far or how fast. The pace will guide Fed policy going forward. It will take a hawkish stance today, still aiming to bring Fed Funds to 3% or higher by the end of this year. Markets are starting to look to next year. Might growth reaccelerate in 2023? It’s much too early to call. This week’s earnings reports suggest that much of the impact of economic deceleration is already priced into stocks.Read More

A sloppy Friday followed three strong sessions last week. Interest rates fell. Stocks were impacted by weak earnings from Snap and a poor revenue report from Twitter that raised fears…

July 25, 2022 – Weak growth from Snap and Twitter reminded us on Friday that there is still downside during this earnings season, but as we enter the biggest week for reports, futures point up again this morning. Wednesday’s FOMC meeting will most likely reinforce the Fed’s intent to get rates up to 3%+ quickly. Whether that will be enough to slow the economy to the point where inflation expectations can be grounded below 3% is still open to debate.Read More