NEUTRAL … Rating of 5 (0 - 4 is bearish, 5 is neutral, 6 - 10 is bullish). I didn't like the Monday morning price action, but the afternoon was as expected. Be very conservative here. I could shift 1 mark in either direction next week - watching market action closely - could go either way.
ECONOMICS … Increases in many of our key economic series have fallen off to lower levels than experienced in the past three months. That is somewhat expected - the pace of recovery is typically rapid in the beginning, then slows to a more normal pace. Here is the important point --- current levels of increases are better than typical monthly increases experienced over in 2018 and 2019. Consequently, the interpretation here is that the economy is still moving along very well.
STIMULUS … There is no question that recent lack of approval of a third stimulus bill is having a negative effect on the market. Late Monday, the news channels announced that further progress has been made. A new stimulus package would most likely move stock prices up and keep Wall Street from having a little temper tantrum.
MONEY LAUNDERING … A US FinCEN report circulated by Buzz Feed Monday stated that over the last 20 years, senior banking figures at major banks knowingly allowed $2T in criminal money laundering – $1.3T from Deutsche Bank (Germany), and $500B from JP Morgan Chase (US). Also cited were Bank of New York Mellon (US), Standard Chartered (UK), HSBC (US) and others. This includes criminals, drug kingpins, and terrorists, etc. Many of the transactions were linked to British banks and British offshore territories. The banks say that these transactions “happened a long time ago” and everything was cleaned up post 9-1-1, they have taken robust actions to clean things up, etc. <<It may be old news, but it’s still shocking; the EU is putting forth new laws to deal with this.>>
MARKETS … Monday afternoon stock price performance (closing at -510 versus a morning low of -940) to me is indicative of late afternoon professional money manager buying activity, i.e., this displays their confidence in the market.
If you are not a current client, please allow me the opportunity to serve you. For more information, visit http://www.defensiveadvisor.com
Opinions voiced in this post are for general information only and are not intended to provide specific advice or recommendations for any individual, without complete knowledge of that individual’s total financial profile. No strategy assures success or protects against loss. Past performance does not guarantee future results.