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Good morning:.

It is usually the equity market … stocks … that get the most attention as fixed income just seems so boring by comparison.  But not today.

Long-dated bonds have had a yield problem of late … affecting everything from corporate loans to home mortgages … and hope that the Fed will soon do its best to reduce rates has all but vanished … as inflation remained far above the Fed target.

So with yields at an uncomfortable level, the U.S. Treasury stepped in and purchased a substantial amount of U.S. debt, driving prices up (and yields down).  But this intervention has had less effect than envisioned … as the yield on a 30-year bond is only slightly under where it was at the time the announcement was made.

Not helping, of course, is oil … which rose after the President announced “economic D-Day” … targeting Iran … hoping this would be painful enough to bring the Iranians back to the negotiating table. But so far, an inflation rate in that country of around 89% (according to CNBC) didn’t result in anything concrete, leaving many to wonder just what it will take to accomplish the U.S. goals.

Meanwhile, our own gas price jumped to $4.10, far above where it stood at the start of the “skirmish” … so we have our own issues to deal with.

Also getting a lot of attention this morning (finally!) is the national debt, as the number just crossed the $40 trillion mark.  Realizing it only hit $30 trillion as recently as 2022, I assume we will be talking about it reaching $50 trillion shortly after the next administration comes in … no doubt following announced (and fictional) campaign promises that they will be working hard to lower the debt.

You know I play golf on occasion and struggled for so long to break 100 … which I happily do now on occasion.  One reason for the high score … other than limited talent … is I am a real stickler for the rules … including “hit it where it lies” as … let’s face it … moving a ball during a round can greatly lower a score … and I just won’t do it.

I thought of this yesterday as my ball sat above a mostly buried tree limb and I decided not to move it as the green was within distance of a long iron … and I looked to legitimately reward a good tee shot.   Hitting down on the ball, instead of the green it quickly found the middle of my face and I had blood spurting for quite a while out of a nose I thought for a brief moment was broken.

So if we ever play together … I am announcing in advance that I am moving my ball.

By the way, markets are down at the moment as there is growing concern that the situation with Iran will continue for quite some time … and it is past the point where we can look to start over as if the war didn’t happen

… making us all realize there are certain rules stocks follow … just like in golf …

… and the market takes no mulligans.

Have a great day,

Joseph G. Witthohn, CFA

Have any questions? Please contact info@teamemerald.com

New and want to subscribe to Wit & Wisdom? Subscribe here   A Look At The News | August 20, 2026 As of 11:10 AM today … The claim is the rise in our nation’s debt … now over $40 trillion … came “faster than anyone expected.” Really? Who?  Certainly not anyone who has been paying attention (CBSNews) https://www.cbsnews.com/news/national-debt-tops-40-trillion-doubles/   Bond yields recently jumped in anticipation of a continued rise in inflation, but the Treasury Department made some purchases in the attempt to change its course (PBS) https://www.pbs.org/newshour/economy/an-alarmed-bond-market-gets-the-trump-administration-to-act-again   … and the President is again trying to dictate to the Fed how to handle rates and calls for a rate cut … which most economist feel just won’t happen any time soon (CNBC) https://www.cnbc.com/2026/08/19/trump-bemoans-fed-interest-rate-policy-says-us-should-be-paying-much-less.html   Is the U.S. and Canada friends again?  Probably not, but at least there seems to be some sort of agreement that will delay the start of a trade/tariff war … for now (NPR) https://www.npr.org/2026/08/19/g-s1-139156/trump-canada-tariffs   Europe has been having quite a problem with gas prices and with winter approaching … and inventories low … prices this winter can prove to be quite chilling (EuroNews) https://www.euronews.com/business/2026/08/20/europes-gas-prices-have-doubled-with-the-worst-yet-to-come   The onslaught of Amazon trucks on our roads might slow to some degree as the company forecasts explosive growth in drone deliveries (CNBC) https://www.cnbc.com/2026/08/19/amazon-plans-drone-expansion-as-top-exec-projects-1-million-deliveries.html   The statements above are supplied for educational purposes only. The statements depict the viewpoints and opinion of the author and are not necessarily the views of Emerald Asset Management or its affiliates. The information described herein is taken from sources which are believed to be reliable, but the accuracy and completeness of such information is not guaranteed by us. Emerald Asset Management PA, LLC | 717-556-8900 | 3175 Oregon Pike, Leola, PA 17540 Want to change how you receive these emails? You can unsubscribe from this list. ———————————————————————————- The statements above are supplied for educational purposes only. The statements depict the viewpoints and opinion of the author and are not necessarily the views of Emerald Asset Management or its affiliates. The information described herein is taken from sources which are believed to be reliable, but the accuracy and completeness of such information is not guaranteed by us.