I'm sure you know it was -2.03% (approximately) in the early going, but then two of the Fed cockroaches crawled out to refute the full-point July rate hike idea.
This is more evidence of why I believe Volcker-magnitude rate hikes are implausible. Our rulers are generationally addicted to easy money.
Unfortunately, this time around, many Americans have deep pockets from saving during Covid which by the way we still have and tons of money doled out from the never ending Government printing press. If they can’t stop the spending, big interest rate hikes may be the only way to go. There is still a huge housing shortage in the US and people are still buying at inflated prices. Average rents in NYC hit an all time high over 5,000 a month I think and people are still paying it. Employers are just starting to cut back. I am still predicting big interest rate hikes down the road, unless we get into all out war. Then all bets are off. I would rather wait until the falling knife hits the ground. I will eat the first 5 percent to the upside before I buy anything substantial again
I am still predicting big interest rate hikes down the road, unless we get into all out war.
The market is expecting a terminal rate of 3.5% for the hiking cycle.
I'm betting it will be lower than that.
Sounds like you're more in the 5% area or higher. If you're correct, a lot of securities are mispriced. Seems like energy stocks would fit your thesis, and they've pulled back hard. Are you considering any long positions that would benefit from inflation?
Not at the moment. I think energy demand will slow some for now. A huge potential mess for many countries come winter. And even here too. My most recent home heating oil delivery was in the 6.50/ gallon range. I have a small older home and if those prices hold, I am looking at a bill for the year beginning in September to the following August in the range of 8,000 bucks if not more. They are waiting in the wings to spike our electric rates too. Right now mine is much less than the average home at less than 130/month. It helps having a sea breeze all of the time tThen I have to wonder what are they going to do to gouge people as the roads get loaded with electric cars. So many things to consider. We still have supply chain issues affecting the demand equation. I also expect and I hope I am wrong about this, a huge wave of credit card default and or people making minimum payments at rates even higher than now of like 30 percent. I am going out on a limb and really hope I am wrong to predict a 20-25 percent loss for most people in their portfolios for 2022. Believe me, I am not immune either. I knew I should have totally bailed in January, but only did it partially. Very hard to predict with accuracy due to the extreme international tensions and goings on as we speak.
Then I have to wonder what are they going to do to gouge people as the roads get loaded with electric cars.
They (the government) will find new methods of gouging people. They can tax charging stations. They can tax miles driven as tracked via the mandatory chip in your car.
I am going out on a limb and really hope I am wrong to predict a 20-25 percent loss for most people in their portfolios for 2022.
A balanced portfolio is already -15%, so you're predicting a further -7.5% in the second half. It's definitely possible.
Markets: +2.15%, +1.92%, +1.79%. Semis gains exceed all three. Hopefully, my sell instructions were tossed. I’ll be able to check later. Another panic sell fiasco would be crushing. Living on a prayer.
I have no idea what's going on. You wanted to sell at a low price, but now you don't want to sell at a high price?
Back to the falling knife topic, WDOFF Wesdome Gold Mines warned it will miss production estimates due to equipment problems.
Stock price plunged 20% this morning to below 7. I screwed up my alerts and didn't see the news until the final hour. I think it's a buy at 7.50, but I could have had it much lower. What to do?
Only up .37 % today. No complaints though as I have been going to more cash. The report on retail sales being up one percent is interesting. The way they figure it at one percent it’s probably just the extra money people are paying for the same goods, not really an increase in buying more things. The Fed may be content for a .75 hike instead of the one percent that Canada did. On the other hand I don’t think inflation is going down anytime soon. Just one more example, I called the dealership where I bought my new ELANTRA in 2019 as they had a nice pearl white 2022 listed on their website. I already have 77,000 miles on my car. Mostly casino trips of course. Anyway I know the sales manager and business manager there and ask them to call me back with the best price on the car. It is an entry-level car like mine and the sticker was just over 22,000. When the finance manager and business manager called back they apologized and said sorry due to market conditions we cannot sell the car for M SRP. The premium will be another three or 4000 bucks. Of course I told him thanks but no thanks. No damper on inflation from these guys.
The report on retail sales being up one percent is interesting. The way they figure it at one percent it’s probably just the extra money people are paying for the same goods, not really an increase in buying more things.
Exactly.
Stay tuned for a whole lot of lying with numbers.
Zero Hedge posted this inflation-adjusted chart from Bloomberg (which I can't confirm because Bloomberg is paywalled):
There may be some wiggle room in adjusting for inflation, but Bloomberg calculates the adjusted number as red (negative).
To clarify, I hope they deferred the sale until this afternoon after all the confounding pain they caused. I want to realize every cent of this bounce. It can’t last forever.
Gold Exclusive
My Favorites
