Stocks remain in a holding pattern this morning as we are one week away from the start of the most important Fed week ever. Okay, that is tongue-in-cheek … as it seems to be how every upcoming Fed meeting is broadcast.

There is one bit of good news as inflation seems to be coming down (or at least the rampant growth is slowing) and there is now talk that it could soon fall below the Fed target of 2%.  But here is where things get interesting as in one scenario, there is “disinflation” … where inflation is still positive but drops … and then there is “deflation” … where there is an actual decline in prices.

While we may cheer for deflation … for, after all, who doesn’t want lower prices … we shouldn’t cheer too much because economic ramifications are typically not good and the expected result would be a sharp rise in unemployment as companies clamor to maintain (or regain) profitability.

Data out this morning shows Americans are still borrowing like mad and Bloomberg reports consumer debt in July grew the most in two years.  A concerning thing is when you look at Daily Shot Letter data you see pure credit card use (by dollar amount) is at its highest level in almost 20 years … even when inflation is fully taken into consideration.

The new Apple Airpod is coming out in a few weeks and I think I will be a buyer.  Why?  I have looked all over and can’t find my “old” set.  The new version supposedly has much improved background noise cancelling and can be used as a hearing aid … which might become more important as I age.

Yes, aging is of concern.  I’ve written in the past that my mom has dementia and spending time with her every couple of days, it is quite upsetting to see how this has progressed.  It is no longer the case where someone who is relatively healthy doesn’t remember you at all, but has become one where … on top of the mental disappearance … there are physical issues where verbal ability is gone, among many other things.  Friends and I talk about the “what ifs” … and every one agrees they never want to get like that. I am afraid we’ll see more cases among people we are close to as our society ages.

Just know that if I owe you money, I’m not welching … it’s just that I’ve conveniently forgotten.

That will wrap it up for today.

My friend called from Florida and told me a hurricane is coming … and for that reason he keeps bacon in his fridge, which he calls “hurricane bacon.”

He figures that when the storm hits, he’ll put the bacon in his pocket so if he gets buried in a pile of rubble, the search dogs will find him first.

Bacon has so many great uses.

Have a great day,

Joseph G. Witthohn, CFA

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