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If You're Confused, It Means You're Paying Attention

Updated: Aug 31, 2023

Happy Market Update!

Well, it’s that time again…Fed week! So much conflicting information. You think you get tired of seeing the chaos I write about? Imagine having to dig through it all. Yes, I can see that the S&P shows a Bull market from October. What does that mean? We are 20% or greater from the lows in October. But when you move out on the charts, it still looks ugly. What’s that mean? I don’t know. I just work here.


I had a whole other paragraph written, but decided to delete it after the Fed’s announcement, which was followed by the Q&A portion. I mean, wow. Let’s just get right to it.


The Fed did pause. What does that mean? Your credit card rate won’t go up! (Unless you missed a payment…I can’t help you with that.) Normally we might be celebrating. But that is not what is happening. Why? Because while they paused, they also increased their projections. Currently, the majority of voting Fed members imply that we will see another 2 quarter point hikes this year. So why…pause? (He was clear this was not a skip). One of the journalists asked him why not just rip off the band aid. His answer? As you get closer to the destination, you usually slow down. What? I don’t remember any time on a long journey I was like, I’m almost there…I just really take longer to get there. He still thinks a recession is avoidable with a “soft landing”. That might tie into the narrative the “bull market” is seeing. Time will tell. (P.S. a few members wanted 3 more hikes).

But the bond market and stock market have been all over the place for the past hour. The good news? It’s looking like they would cut 100 basis points next year. So we go up another 50, and then down 100. So down 50 from here by the end of 2024. How’s that credit card debt looking now? I hope you can make it through their slow drive.


How about banks? He doesn’t have an answer regarding the banking issue from this spring. Think in terms of politicians. To me? This means…

But why do you read this? You read this for the chaos and excitement! And I’m fresh all out of excitement…

Here’s what the SP& 500 has done today. (SPY is the ETF or exchange traded fund that follows the S&P index). This is today’s minute by minute chart.

Since I am in the business of debt, let’s check out the US Treasury’s data on where our interest payment lands in our total outlays. First, notice how the outlays are greater than the receipts. How would you sleep at night if your house was in that order? Second, the income security is the interest in the outlays. It’s the 5th highest amount paid. It’s almost more than defense spending…and over the years, I’ve heard a lot of people talk about how defense spending is out of control. But crickets on the interest payment.

How’s sentiment? Improving from the bottom. But, when we are this low…and even higher on the chart, recessions come. So I’m sticking with…no soft landing coming.

But Tim, jobs are great! Lots of jobs. Yes, I can’t argue. But, you know me, here’s my counter. The lowest wage jobs are the ones growing. Look at the other jobs. Yikes. That’s because, in my opinion, a lot of these jobs are second and third jobs to deal with inflation…and they don’t pay much. From Blackrock:


10yr: I’m looking at the 2 angular yellow lines. The upward trend one starts in Dec 2021, and the lower trend one starts in October. As you can see, it’s coming into a triangle peak. We are watching for this to breakout one way or the other. Hold on to your hats! I’m locking.

MBS: Still moving sideways. Now lower in that move. Not a good sign for interest rates. How high can those go? Ask a Boomer. They know. Yikes.

So this is just a snip-it of what it looks like in my head. I mean, it’s messy in there. It’s not good…and great at the same time. I’ve not been bored in this career, and I don’t expect that to change. Thank goodness DC is a mess. It gives me something to write about. So what’s up? What’s down? What’s going on? We will know when we read all the books written about this time in the future. Maybe that’s what I’ll do. I’ll put all these newsletters in one book and sell it to my son. He’ll buy it because he feels bad for me…with money I give him. Hey, I most likely won’t be writing this newsletter next week. After this chaos, I need a break. But what if I get bored being away from markets? I’ll probably see you next week…



Tim Lindsey

President/Sr. Loan Officer

Bear Mortgage Inc.

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