Some thoughts on the big picture that will probably trigger some of you…and a very simple conclusion – July 28, 2023
This is Dan Fitzpatrick and your Chart of the Day. We had a pretty nice reversal ( NYSEARCA: SPY ) after yesterday’s afternoon selloff.
The PCE came in today, it was a little bit better than people expected and so the market recovered. I don’t think the Fed knows squat about much at all. And I think that they are using last-century tactics to manage this century’s problems.
There are two aspects of what’s happening, and that is, the cost of money, which is what the Fed is dealing with, and there is also the amount of money. And then you have got Janet Yellen, probably one of the more incompetents that has ever run the Fed.
She screwed up the interest rate part of it with the whole, inflation is a transitory thing and later said, “Well, I think I was in good company feeling that way”, which got me thinking, wait a minute honey, I thought you were supposed to be the one that everybody else was agreeing with. So why are you saying, “I was in good company?” You were the company.
So she screwed the pooch on that for years. Now she is over in Treasury, where it is like, well, wait a minute, now that I screwed monetary policy, now I can go in and get the other half of the equation and screw up how much money we’re putting in.
What are we at, 32 trillion and counting? Tens of trillions here, tens of trillions there, pretty soon it kind of becomes a situation where we are probably not going to be able to climb our way out of that. So that is where we are. We’ve got Powell doing what he’s doing, and not much good about that. But hey, we are coming in for a soft landing at 32 trillion dollars.
But don’t worry about it because Janet Yellen is over there giving to Zelenskyy and the oligarchs over there. And then also, of course, talking about using monetary policy to combat climate change. So the adults are at the helm, we can feel really good about that.
And so what we have now on this is, we’ve actually got a situation where the market has finally shrugged its shoulders and going, we don’t really care about it anything, it is all good. So what we have got to be doing is, we have got to be sticking around with the all good portion of things. And that is what is happening right now.
You look at the S&P ( NYSEARCA: SPY ), it’s moving higher. Certainly, you look at the NASDAQ, and that is really moving higher. We are very, very close, I’m just looking at the QQQs ( NASDAQ: QQQ ) here, we’re like 6.5 percent away from an all-time high.
And the wheels have come off the wagon when it comes to monetary policy, and certainly fiscal policy, Congress never met a dollar that it didn’t want to print and then spend, so we’ve got big trouble that way.
This is my suggestion to you, it is kind of like, make money while there is money to be made. Or put another way, it is every man for himself, and I think there’s a lot of money to be made in the market by just staying long. That’s really what I am saying right now, just stay long in the market.
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