Month: June 2021

Commentary for the week ending 06/26/2021

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So we have an infrastructure deal, or do we?  I was happy at first to hear that a “normal” infrastructure deal had been struck on Thursday.  Then President Biden pulled the rug out from under us by saying it had to be tied to the progressive deal on the so-called “human infrastructure bill” (essentially a long liberal “wish list”).  Then this weekend Biden tried to walk that statement back by saying he would still sign the “normal” infrastructure bill!  More of the same from a do nothing government.  As for Biden, I am reminded of an old Buddy Hackett routine where he played a rude Chinese waiter who grows frustrated with a couple who can’t make up their mind on what to order.  He finally says “make up your f-ing mind, one from column A or two for column B!”.   read more

Commentary for week ending 06/19/2021

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Well, it looks like the Fed has finally acknowledged that inflation may be a problem.  But what did they do?  Essentially nothing.  No decrease in asset purchases and no increase in the fed funds rate.  All it did was signal that they may do so by next year (according to the “dot plots”).  Curiously, the ten year yield is still at 1.45%.  Some folks think that the market is actually two steps ahead of the fed – that is, they think that the fed will raise rates, slow down the economy and then be forced to lower rates again!  I don’t know that the market is that sophisticated.  I think it is just confused by mixed signals.  Personally, I see the fed raising rates by the end of this year (not the next) – and that the 10 year note will be yielding 2% by year end. read more

Commentary for week ending 06/12/2021

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New inflation data showed a 5% jump in consumer prices on a year-over-year basis in May.  But the market shrugged this report off, perhaps believing the Fed’s line that “inflation is transitory”.  I don’t believe that inflation will be transitory so I am less than sanguine about the short-term prospects of the stocks in the Growth portfolio.  So, I would not add to positions in the growth portfolio at this time, but I would not sell anything either (otherwise known as a “hold” recommendation!).   read more