I will admit that I was feeling a bit ill the last few days. Using a home kit, I tested negative … but quickly realized the cause for my discomfort was not Covid at all. Instead, I felt this way every time I looked at my portfolio.
I did, however, take comfort in one historical item pointed out by Ben Carlson, CFA of Ritholtz Wealth Management. It seems that in the last 94 years (which happens to be a long time), there were 59 instances where we had a “double-digit correction.” In 58% of those occurrences, the market finished higher for the year … and 39% of the time actually ended up with double-digit returns! Of course, I am not saying either of these things will happen this year … but one thing you can imagine is that during each downturn, some investors convinced themselves the sky is falling … not accepting that the sun would eventually reappear.
And I need such comforting stories … as more are sounding alarms.
Regarding this, Dan Suzuki of Richard Bernstein Advisors gives his view (in the second story below) that the drop in many stocks – especially tech – is far from over. Pouring salt in the wound, CNBC is reporting Paul Tudor Jones as saying the he can’t think of a worse financial environment for stocks or bonds right now … and Bill Dudley, former president of the NY Reserve Bank, feels the ability of the Fed to combat inflation without bringing on a recession is “very, very unlikely.” Yikes!
Hold on one second! We have other educated voices, such as JP Morgan Chase, where strategists (according to Bloomberg Canada) are forecasting a market rebound based on upcoming “better-than-feared” earnings … which could overcome the extreme weakness in investor sentiment … with a positive result for investors.
Stay tuned! But keep the aspirin within reach.
That about wraps it up for today … as I will be busy this afternoon.
Someone stole my phone yesterday.
And I am looking for iWitnesses.
Have a great day,
Joseph G. Witthohn, CFA
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 11:00 AM today …
The Fed has quite a few people feeling … um … uncomfortable … which is not a good thing for investors as we are in the middle of “decision week.” (CNBC)
… and confidence in both the Fed … and the markets … is important for sustainability … while some warnings of certain stock being very much overvalued are certainly not comforting (CNBC)
Okay … we have recently been introduced to oat milk, almond milk and even milk derived from peas … but lab-grown human milk? This doesn’t strike me as something I’d like to try (CNN)
You’ve had an interview and now it is time to wait for a decision … but do something so you won’t get lost in the sea of candidates. Write a thank you note. At once (ZDNet)
While most of the population are either vaccinated or have already caught the virus, the possibility remains of another surge. Ugh (CNN)
Much has been written about youngsters feeling immortal and more easily open to risky behaviors, but some feel all of humanity are ignoring risks to our own existence (Space)
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.