Highlights

A few highlights from our latest notes:

This jibes with recent evidence that the consumer is slowing down:

How the Market Sees the Tariff Threat, A Slow Going Fed, and Vibrating Stocks (video)

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Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

Charts, and Thoughts, of the Day

This morning’s reaction to January’s hot CPI number speaks to the somewhat precarious spot markets find themselves in.

As I type:

Quoting Buffett and Considering Scenarios (video)

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Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

Thought and Chart of the Week: Something's Going To Give

It’s unusual to see gold, stocks and the dollar experience such positive correlation (have since last October)... Gold is catching a bid on geopolitical angst and central bank buying… Stocks are riding momentum and bullish sentiment… The dollar is up on high relative yields and geopolitical angst.

I.e., Something’s going to give:

It's Not About the Fed Right Here! (video)

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Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

The "AI Meltdown"

I was thinking this morning that if I didn't know what I think I know about markets, and my experience captured merely the past few months, I'd be convinced that whatever happens on a given day can be expected to be more-often-than-not reversed the very next.

Yesterday, for example, we watched the tech sector suffer -- what I'm sure too many investors deemed to be -- a meltdown; taking the Nasdaq 100 and the S&P 500 down with it... Interestingly, despite somewhat ugly action across our commodities exposures, we didn't feel it much, as places like consumer staples and healthcare saw sharp rallies... Our non-US exposure held up okay (relative to US tech) as well...

What Could Make For Another Leg Up In Stocks? (video)

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Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

Seeking Value in a Pricey Market, Decent Short-Term Technicals, Thoughts on Tariffs & The Thing About Stimulus 'right here' (video)

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Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

An Important Look at Conditions, at Stocks, at Yields, at the Dollar, at the Yen and Gold (video)

Dear Clients, definitely take this one in when you have a few minutes... thanks!

Once playing, click the icon in the lower right corner for full screen. Focus should occur after a few seconds; if not, click the wheel to the left of the YouTube icon to adjust:

Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

That Minsky Feel, and A Peek at Stocks, Yields, Gold, the Dollar & the Yen (video)

Once playing, click the icon in the lower right corner for full screen. Focus should occur after a few seconds; if not, click the wheel to the left of the YouTube icon to adjust:

Attention Non-Client subscribers: Nothing in this video should be construed as investment advice. The examples expressed relate to portfolio management we perform on behalf of our clients, and, again, under no circumstances are they to be considered recommendations to the viewer.

On Human Nature, on Isaac Newton, and on Today's Mixed Picture

Well, if I've learned anything over the past 40 years doing what I do, it's that, at nearly every major turning point the majority of investors, and policymakers alike, tend to assume that the future is going to unfold essentially the same as the recent past.

As, alas, BCA analyst Davil Joshi pointed out in this morning’s chat,

“The winners of the old technology are never the winners of the new technology.”

His concern being that the market continues to, in his view, mistakenly bid up the companies that are essentially the winners of yesterday’s technology, that the true long-term winners of AI have yet to be discovered. 

Per Alan Watts (on human nature):

"We are driving a car, looking at the rear-vision mirror. The environment in which you believe yourself to exist is always a past one, it isn't the one you're actually in."

And that, in reality, waves and cycles are as inevitable in economies and markets as they are in nature:

“…there is no such manifestation as half a wave. We do not find in nature crests without troughs and troughs without crests.”

And that the longer the cycle, the more the crowd loses sight of this unalterable reality:

“The slower the wave goes the more difficult it is to see that the crest and the trough are inseparable.”

I.e.,

“Trough implies crest just as crest implies trough.”

Thus, call it human nature, recency bias, what have you, it's easy for markets to ultimately do what they do best.

I.e., the old Wall Street adage: