Markets See Looming Recession – The Fed Sees “Softish” Landing

Market volatility in spades this week!  On Tuesday, markets were all a-twitter (oops, can’t use that word!) over the large and unexpected rise in April’s retail sales (+0.8%).  That sparked a +2.0% rally in the S&P 500.  What market commentators neglected to mention was that, when adjusted for price increases, the “real” number was negative […]

When (Why) Bad News IS Good News

When (Why) Bad News IS Good News It was another volatile week in the financial markets.  While there were up days, like Friday (May 13), the trend continues to be down.  The table shows the weekly movements in the major indexes and the downdrafts from their nearby peaks.  Note that the Nasdaq and Russell 2000 […]

The Recession No One Will Discuss

As Equity Investors Rush to Exit Employment – Weaker than the Narrative The markets yawned at April’s headline Payroll Survey number (+428K) despite the media’s characterization of the report as “strong.”  That’s because, upon further analysis, the most charitable description would be, in our view, “mixed.”  In fact, “worrisome” would be our best characterization.   Here’s […]

Blame it on the Fed – Part II: Inflation

The biggest surprise of the month, a -1.4% real GDP print (preliminary) (market consensus was +1.0%) was greeted with a yawn on Thursday (April 28) because the components pushing down the GDP were not consumer spending issues.  The biggest culprit was the balance of trade (imports greater than exports) which subtracted -3.2 percentage points from […]

Why Bonds Now Belong

Jim Cramer of CNBC has a saying: “There’s always a bull market somewhere.  My job is to help you find it!”  Rule #5 of Bob Farrell’s famous 10 Rules for Investing states: “The Public Buys the Most at the Top and the Least at the Bottom.”  His Rule #9 says: “When All the Experts Agree, […]

Yields Spike as Fed Reveals its Balance Sheet Intentions.

The Economy Weakens as Consumer Frugality Begins Equity markets fell last week (April 8), but the biggest change was in fixed-income as the Fed’s minutes and continued hawkishness from Fed governors continued to put upward pressure on the yield curve.  At the week’s start, interest rates had inverted (short-term rates higher than long-term rates).  As […]