Joseph G. Witthohn, CFA
VP of Product Development Emerald Asset Management

Good morning.

Stocks are bouncing between positive and negative territory this morning as investors and analysts alike absorb news that does not appear to give any firm indication of what lies ahead.

The Fed appears to be tightening its policies a bit as the guessing game continues as to when a rate increase will actually take place.  On top of this, stock volatility picked up recently and CNBC reports that Deutsche Bank Chief Market Strategist, Binky Chadha, is calling for a deep stock market correction.  But not everyone shares this view.  

There are certain issues that are of concern right now in addition to the Fed.  This includes supplier problems … which is a main reason why Costco (article below) is putting limits on the purchase of certain items … and inflation remains a concern of most.

Why inflation?  Well two main components drive inflation … supply and demand … and either one on its own is powerful enough, at times, to move prices.  We may soon see the effects of both … as supply (already mentioned) is tight in some areas … and demand may pick up quite a bit, due to the household strength and a buoyant employment forecast.

Daily Shot (using data from Macrobond and ING) is reporting that “household balance sheets have never been stronger.” And there is one other item that adds to the demand argument … as emergency unemployment benefits are expected to soon expire and Goldman Sachs expects that this will “significantly boost payroll this year.”

There is also one other item that will hit the headlines over the next few weeks … the national debt ceiling … and we are about to have a great view from the stands as we watch the annual dance.  Every year seems to be the same … as the party in power spends … and asks for the budget to be raised.  The minority party shouts in horror as to how this will negatively affect the national debt and speak volumes about the ramifications.  Then … at some future time … the roles are reversed … the minority becomes the majority … the present worriers become the spenders and we wait until the next time the fiscal year nears its close so we can start the movie over again.

That’s about it for today.  Writing will be spotty next week as I have some industry things taking up a bunch of my time.   I don’t like days when I don’t write anything as – after 14 years or so of doing this – it has become part of my daily routine.

In fact, I ran into an old flame on the street yesterday who said she reads my stuff … but I quickly remembered that I was mad at her.

We had plans to meet up at a gym once … and I was stood up. She never showed.

That’s when I knew we weren’t going to work out.

Have a great day,

Joseph G. Witthohn, CFA
Vice President
Emerald Asset Management PA, LLC
610 Freedom Business Center Drive
King of Prussia, PA 19406
Direct: (610) 285-9905
cell: (856) 625-7915


As of 11:58 AM today …

Quick Look at the News

    Comments are closed.

    Professionals Login

    Please fill out the form to log in to
    our Emerald professionals area.

    Not a member? Sign Up Now