Journalists are reporting on the constant chaos, but they are not featuring the Congresspeople who are speaking up. Here are a few; there are many more.
The stock market is always going to have corrections. For me to say that we’re going to get a correction isn’t me pretending to say I am Nostradamus. Corrections happen all the time.
We humans like a narrative, a story we can relate to, because it helps us make sense of things, and that makes us feel more comfortable. The fact that the stock market was up about 19% over the previous four months, based on very little improving fundamentals, set us up for a tumble.
My concern is that the Fed will begin to gain comfort in the functioning of short-term interest rates, then decide to reduce the balance sheet just before a shock coincides with less liquidity and super-high stock valuations.
The U.S. produces about 13 million barrels per day and consumes 21 million, so higher oil prices could depress economic growth. But I’m not worried about that yet.
Not that we can ever rely on one indicator, but those historical instances of outperformance suggest that we haven’t yet seen too much of a good thing.
Where the economy might go from here is another conversation, but we do know that defaults on existing debt are relatively tame, meaning that consumers are not yet feeling overwhelmed.
If they do cut rates this afternoon, I’m growing convinced that the Fed will be one-and-done, and there will be an extended pause before we see any new action.
Dalton -- Last Thursday, July 18, the yield curve (the spread between yields on 10-year and three-month U.S. Treasuries) turned un-inverted for the first...
