Over the years that I’ve published my thoughts on Wall Street Insights & Indictments, one of the most valuable things I’ve received is feedback from you, my readers.
Recently, I’ve heard the calls and read the messages from many of you that have asked for some reading recommendations. It’s certainly a popular trend for many people interested in investments who want to know what Warren Buffett or Elon Musk or Bill Gates are reading, and I’d be flattered if anyone even put me at that same status of any of those giants.
So I’ve decided from now on, not just to the end of this year, but for the ongoing future, that I’d like to send out to you a special series every month of my own personal book recommendations.
What I pick could be educational, inspirational, or just plain entertaining, but in the end I want them to be useful for your success and compelling for your mindset and attitude towards a better financial future.
I admitted that I was wrong on national television. Varney called me out for predicting 6 months ago that benchmarks could be down more than 10%, but just this week we reached yet another all-time high. I’m back to being optimistic, but still cautious with the economy looking good overall. So things are rosy for now, but no one out there is talking about the one thing the Fed must do, so watch here where I explain exactly what I mean… Click here to watch!
The Federal Reserve’s policy and rate-setting committee, the Federal Open Market Committee, meets today and tomorrow for the seventh of eight regularly scheduled yearly meetings.
At the conclusion of their meeting, the committee issues a press release, generally referred to as the FOMC Statement, outlining its economic outlook, policy decisions, and targets for the federal funds rate.
The chairman of the Federal Reserve, who heads up the FOMC, by statute, holds a press conference four times a year after the FOMC meets. However, in June 2018 Fed Chairman Jerome Powell announced he would hold a press conference after every FOMC meeting in 2019.
But you don’t have to wait until tomorrow to know what’s going to happen with rates and see how the market’s going to react.
Last Monday’s Capital Wave Forecast (October 21, 2019) called for the week to be “positive, if not, then a sideways week,” which is almost exactly what we got.
Only the sideways part came first and then followed by a Friday rally.
After uneventfulness throughout the week, better than expected earnings outweighed a few heavily knocked-down stocks who missed estimates and guided lower (setting up beats in the future, no doubt), teeing up a Friday run towards all-time highs.
The S&P 500 got above its highs on an intraday basis on Friday but closed just shy of its July 26, 2019 peak of 3025.86, ending just below there at 3022.55.
The now three-week run up for the S&P should be rewarded this week with a finish above its old peak, unless of course, something spooky surprises us this Halloween.
The Dow rose .7% last week to 26,958, which is about 1.5% below its last July all-time peak.
The Nasdaq Composite rose 1.9%, a four-week-in-a-row rally, and ended only 1% from its July peak.
All the checked boxes in the “probably going higher” column I ticked off last week, I’m ticking off again.
Check off a likely good week for earnings, a likely good week in terms of political and geopolitical developments not being an impediment, and most notably, I’m double checking the narratives box this week.
That’s because the recession narrative appears to be receding, though there are lots of naysayers in the financial press and analysts still casting stones on the economy marching along at a steady pace.
The whole WeWork saga just keeps getting stranger and uglier, especially for SoftBank, Vision Fund, SoftBank’s $100 billion subsidiary investment vehicle, and Masayoshi “Masa” Son, founder, chairman and CEO of SoftBank and CEO of the Vision Fund.
SoftBank just took control of the floundering WeWork this morning with an almost $5 billion rescue package after the company’s board sought out 75 financing sources in a week, but in the end chose SoftBank’s deal over JPMorgan’s junk bond-based rescue plan.
Too bad for SoftBank, the Vision Fund, Masa Son, WeWork, its investors, and its employees, the rescue package is only a temporary lifeline.
While the markets will eventually go higher, they’re stalling due to the anti-capitalism sentiments from the political field. With Boeing (BA) and Johnson and Johnson (JNJ) becoming bigger targets to villainize capitalism, Charles Payne and I know that not all companies have these systemic issues, but it’s nothing we haven’t seen before. However, if Democratic presidential hopefuls use this fuel to the fire for new regulation, capitalism as we know it could get shot down. See where things go from here for markets, the economy, and the future of the United States… Click here to watch.
The Dow and S&P 500 both broke three-week losing streaks last week, and the Nasdaq Composite was up for the second week in a row.
We’re heading back up closer to all-time highs.
The Dow’s only 582 points or 2.12% from Olympus and the S&P’s only 1.9% from its all-time highs. On the other hand, the Nasdaq Comp, the index that’s been higher for two weeks, is 3.5% from Magicland.
So why do I say this is just a “kind of rally” with all this seemingly good news?
Clearly last week was an otherwise down week if not for the one positive lifting market on Friday: trade talks.
This was good news, until it was stripped down and re-rated by market judges.
The reason that the Dow was up more than 500 points but ended up on Friday only 242 points higher was the whole judgement thing.
The U.S. looked like it scored a victory because China agreed to purchase $40 billion to $50 billion in U.S. agricultural products, at least according to President Trump, but the time frame of any purchases wasn’t immediately clear.
Also, China agreed to open its market to international financial services, again according to Mr. Trump, potentially allowing U.S. banks and insurance companies to expand in China: no timetable there either.
China looks like it scored on account of the U.S. not moving forward on Oct. 15 with a planned increase in tariff rates to 30% from 25% on about $250 billion of Chinese goods.