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The Best of What They Said & I Read Week Ending 6/16/2019

Short excerpts from articles I found interesting.  I may not agree with the author and the following material is not intended as investment advice


The Wall Street Journal – June 14, 2019 - What Yogi Berra Would Have Said About This Bull Market – Jason Zweig

  • “It’s late in the market cycle…This bull market for U.S. stocks is by far the longest on record, and only a lunatic would think it can last indefinitely…The S&P 500 hasn’t fallen by at least 20% from a previous high since March 2009. As commonly defined, this bull market is nearly 3,750 days old, the longest in the S&P 500’s more-than-90-year history. That’s twice as long as the average bull market, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. Since 2009, stocks have more than quintupled, counting dividends.  Stocks will stop going up. You can be as sure of that as you are that the sun will set in the west. Unlike today’s sunset, however, you can’t know exactly—or even approximately—when the bull market will end.”
  • “…After 10 bullish years in stocks, some younger investors have no memory of losing serious amounts of money. That could make them think it can’t happen. Saying “this time is different” is easier when you compare it to a previous time you didn’t live through yourself.  As Fred Schwed Jr. wrote in his book “Where Are the Customers’ Yachts?” in 1940: “There are certain things that cannot be adequately explained to a virgin either by words or pictures. Nor can any description that I might offer here even approximate what it feels like to lose a real chunk of money that you used to own.”

Barron’s – June 14, 2019 – The Dow Gains Again as a Decision Looms for the Federal Reserve – Ben Levisohn

  • “…After last week’s rally, the S&P 500 is up 4.9% in June and just 2% away from its record close. Still, there was one thing the S&P 500 couldn’t do—close above 2900, a level that has been identified as resistance by technical analysts, despite two attempts early in the week. From there, it was awfully quiet.”
  • “And for good reason—two of them, actually. First, there’s the meeting of the Federal Open Market Committee this coming Tuesday and Wednesday. Investors will be watching closely for signs that their hopes for a Federal Reserve interest-rate cut at the July meeting will be met. “I’m anticipating a change in the language, but no action taken,” says Carmel Wellso, director of research at Janus Henderson.  As soon as the meeting is finished, the market will turn its attention to the gathering of the G20 nations in Japan on June 28 and 29, when Trump and President Xi Jinping of China may meet, and may—or may not—reach a deal to end the trade war between the two countries.”

U.S. Global Investors - Investor Alert – June 14, 2019 – Frank Holmes 

  • “…Billionaire investor Paul Tudor Jones, founder of and hedge fund manager at Tudor Investment Corp., said in a Bloomberg interview this week that geopolitical disruptions have made gold his favorite trade in the next 12 to 24 months.  The yellow metal “has everything going for it,” he said, adding that if it can reach $1,400 an ounce, it will push to $1,700 “rather quickly.”   The biggest catalyst for such a move, Jones believes, is the ongoing U.S.-China trade war and the broader implication of shrinking global trade. After 75 years of globalization and free trade, we’re seeing a return to the use of tariffs and other protectionist policies.”
  • “Remember, it was the 1930 Smoot-Hawley tariff “that helped send the U.S. and world economy into a decade-long depression,” according to a 2015 article by now-National Economic Council Director Larry Kudlow and former Federal Reserve Board of Governors nominee Stephen Moore. Just last month, global manufacturers contracted for the first time since 2012 due in large part to trade tensions. World trade volume has also sunk the most since the financial crisis.”
  • “The major market indices finished up this week. The Dow Jones Industrial Average gained 0.41 percent. The S&P 500 Stock Index rose 0.48 percent, while the Nasdaq Composite climbed 0.70 percent. The Russell 2000 small capitalization index gained 0.53 percent this week…The 10-year Treasury bond yield remained flat, closing at 2.085 percent.”
  • “…Uber, MasterCard, Visa and other big companies have reportedly signed on to Facebook's blockchain efforts. The Silicon Valley tech giant is expected to formally announce what it has been building next week…Raytheon and United Technologies announced a deal to form a $120 billion aerospace and defense giant.”

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