Market Musings

| May 22, 2018
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The Fed Is On The Wall

I don’t know if you’ve seen this but Atlanta Fed President Raphael Bostic has just walked back some of the hawkish rhetoric from the Fed. Bloomberg quoted him last week as saying, “I have had extended conversations with my colleagues about a flattening yield curve. Regarding the curve going from flat to inversion. We are aware of it. So, it is my job to make sure that doesn’t happen.” Translation: Chill out. We aren’t fools. We aren’t going to tighten so much and so quickly that the US has a recession because of it. | ~Edward Harrison

Can ETF’s Cause A Bubble

After my post yesterday on how to properly use index funds and ETF’s, the topic of can an index be in or cause a bubble was brought forth. Based on the appended data most likely not:

  • ETF Ownership of US stocks = 7%
  • ETF Ownership of US Bonds = 2%
  • ETF Ownership of Gold < 1%

Here’s the rub, this may not be the case for certain sub-sector, such as high-yield bonds.

How Bad Was 2008?

All told, 585 unique funds made money vs. 6,013 that suffered a negative return. The vast majority of those 585 were bond funds, mainly int/short-term taxables and munis. fwiw. | Jeff Ptak of Morningstar

Chart of the Day

Say What?

Roughly 14,000 tons of sunscreen flow into coral reefs every year.

 

Stay Tuned, Disciplined & Patient! {TJM}

The Investor & Character Equation (ICE) | S + R = O

 

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