The Fed maintains QE; Congress about to pass another $1 trillion stimulus bill. But there is a distinct hint of narratives changing. Eventually, the Fed will be forced to scale back stimulus because of inflation. Congress will not always have the ability to pass trillion dollar spending bills. The huge cash flows of 2020 are receding in the mirror. Narrative discussion here: https://www.lloydsintrepid.com/post/it-s-not-over-till-the-high-bmi-lady-sings-or-market-narrative-for

Last week's Service PMI and New Claims For Unemployment data weren't great. Since CNBC didn't want to discuss, let me interject. Robert Lloyd, CFA® Chief Investment Officer Lloyds Intrepid Wealth Management Lloyds Intrepid LLC is doing business as Lloyds Intrepid Wealth Management. Lloyds Intrepid LLC offers investment advisory services in the State of Texas where registered and in other jurisdictions where exempted. Registration does not imply a certain level of skill or tra

Market Narratives continue to dominate market behavior as we progress through 2021. If you are not familiar with the application of narratives to market analysis, I suggest you do a quick internet search of Nobel prize-winner Robert Shiller and his writings on the topic. In 2017, Shiller published a paper called Narrative Economics which was an effort to introduce concepts from sociology, anthropology, and epidemiology to economics. In particular, he explained how narratives

When it comes to our cars and houses, everyone carries insurance. Even for rentals, insurance is recommended and frequently paid for . When someone has an accident and they say, "Oh well, too bad I didn't have insurance," our normal response is "what is wrong with you!" This is practical risk management. My question for you is this: are you doing this same risk assessment with your savings? I am not talking about a complex strategy, just plain rebalancing. These aren't imposs

Fed Chairman Jerome Powell faces Congress with the highest inflation readings in 30 years and a Fed Funds policy rate of Zero! I don't have to tell you we have eye-popping inflation. We see it all around us. The question is what will the Fed do about it. The later they wait to fix this, the more painful the remedy will be. This will ultimately be a political decision. The President and Congress are nervously eyeing the 2022 and 2024 elections. An inflationary recession will n

ISM/PMI Services Indicators turn down unexpectedly. Remember, we are a service economy and the stimulus is starting to wear off. Stocks are trading off, but the big move is in bonds. 10 year Treasuries have fallen to 1.36%; no worries of inflation here, contrary to the narrative. While we tend to focus on the manufacturing signals for indications of growth, as a service economy we must also focus on the changes in service indicators. This slowdown in service spending contradi

You betcha! The ECB (European Central Bank) shook the foundations of the financial world this morning. "Let's include housing inflation as part of our price measure!" Here is what will happen: 1. All measures of inflation will rise dramatically (again!). 2. Central banks will say their inflation objectives have been met. 3. They will cut off Quantitative Easing and raise interest rates. What do you think that will do to markets? Just for fun, I have attached the last 30 years

The S&P 500 is up 15%/yr for the last ten years and up 18.5%/yr over the last three. Is this normal? A recent survey indicates individual investors expect 17.5% equity appreciate in excess of inflation next year. Just for fun, I've attached some valuation slides. Here is the Natixis report on investor expectations https://www.im.natixis.com/us/resources/2021-natixis-global-survey-of-individual-investors-executive-overview. My own view is that investor expectations are complet