Market Analysis Market analysts use facts to justify their outlook for future performance. There are many facts at their disposal and selecting only the facts that confirm their outlook is part of the game. Generally, my advice is to tune out those analysts because their track record is spotty at best. I viewed a webinar on one firm’s outlook for the rest of 2021, mostly because I earned 1 hour of CE (Continuing Education credits...
Market Update It’s official; the shortest recession in US history has been officially declared- 2 months! It was also one of the steepest. Does anyone remember the fear, paralysis and unknown of a public health emergency? The recovery in asset values has also set records. Stock prices, housing values, price and wages increased as well as record low interest rates. Makes your head turn for sure. This week, the Delta variant caused great concern in...
Earlier in my career I worked in health care. The Foundation for Shared Medical Decision-Making was my employer. They created video programs to assist patients who had been diagnosed with certain conditions for which the patient had decision options for treatment. The goal was to actively involve the patient in the decision making process because research said that the more actively involved the patient is in the decision making in regard to treatment, the more...
At the most recent G-7 conference finance ministers agreed on a minimum corporate tax rate of 15%. There are actually 2 pieces to the proposal: one piece taxes corporations in line with the country they operate in by taxing profits over 15%, and the second establishes a minimum corporate tax rate among the G-7 of 15%. The details are far from being worked out and, of course, the devil is in the details. What impact...
In the News Two major issues in the news this week and they are related. The collapse of the Florida shoreline condo building and a tentative agreement on an infrastructure bill by a group of Democratic and Republican Senators and the Biden administration. With the unclear source of the collapse but much speculation, there is a significant possibility that construction that was up to code in 1980 did not consider the impact of climate change...
The Federal Reserve made its decision to keep short term interest rates at their current levels. The statement also shortened the time to expect an increase in short term rates. The Fed states that inflation is transitory as the economy returns from the pandemic induced recession. Sure enough, market reaction was a sell-off resulting in the worst performance of the major averages this year. The one day drop last Friday shook markets. The impact on...
As we began this week’s newsletter we were awaiting the dissemination of the results from the Federal Reserve June meeting. As usual, economic data is mixed in many regards and depending on what you want to conclude about asset values. Inflation, the latest area of investor concern, seems to have stabilized, with mortgage rates headed lower this week along with otherwise stable interest rates that have fallen further this month. Concern in regard to inflation...
JoBeth and I took our first post-Covid-19 airplane flight this past week. We visited my children in Taos, NM, and stopped in Santa Fe, NM for a couple of nights. There was a distinct contrast in mask and social distancing between San Francisco and New Mexico. NM has a high vaccination rate but compliance with public health measures was notably less stringent than SF. It was a bit shocking to us and we still made...
Decision-making, especially when faced with too many decisions, can present a challenge in any environment. During the Pandemic, most aspects of life have been turned upside down including general decision making. Upside down means what was formerly up is down and vice versa. It was easier to decide to practice social distance, mask-wearing, and washing hands. Harder decisions seemed to be revealed on the back end, such as whether to return to an in-person office...
Tax day happened Monday, May 17th officially marking the close to the calendar year 2020. What a year! Inflation or not inflation. Try buying a used car and notice that the shortage of supply and steady demand combined are pushing prices to record levels. Look at rental car prices and you will see a similar trend. It is possible to find both sides of this story in the same issue of the same newspaper on...
Stock market behavior and the divergent performance between the Dow Jones Industrial Average and the NASDAQ market index. It has not been uncommon for the correlation between the two to be -1 or to move in the opposite direction. The NASDAQ consists of mostly technology, biotech, and other "growth" stocks whereas the DJ industrial average consists of manufacturing, industrial, energy, consumer non-durables, pharmaceutical companies, or more in the "value" silo. As the economy revs up...
Bipartisanship has been a stated and restated goal for President Biden. This past week, Republicans have offered a package focusing on traditional infrastructure projects and finances the improvement with fees on users like an increased gas tax hike. Biden will be meeting with Republicans to see if there is any room to work. Is it possible to pass a bipartisan traditional infrastructure plan and then a subsequently expanded infrastructure plan focused on human infrastructure to...
