Someone told me that she generally appreciates what I say in these periodic emails because I tend to not over-bombard with writings and I tend to keep it relevant.  As it would be, those ARE my two goals in keeping in touch this way.  Opinions always my own, of course, unless quoted. . .just fyi.

 The old saying is that, in August, Wall Street traders head for the Hamptons and it’s usually a low-volume, somewhat boring month.  In this age of remote work and electronic access, I’m not so sure that’s quite the case as in days of old, but I do think much of Wall Street checks out for a few weeks and will check back in after Labor Day, which can have a tendency to get interesting.

 There is no doubt a high level of uncertainty in the markets, the economy, and in our world thanks to some global happenings and the rise of the Delta variant.   But uncertainty does not necessarily mean negativity.  Second quarter earnings releases through July were strong and solid.  They displayed a healthy recovery taking place. The job market has headed back toward pre-Covid levels.   Spending has resumed.  Some market fundamentals remain strong.

Much of the time, the bond market and the stock market are roughly aligned. When the economy and the stock market are doing well, interest rates typically are holding steady or rising with the growth ……  Both stock and bond markets are generally known to be looking ahead, at any given time.

However, the bond market tends to be historically a more telling indicator of market health because it does not have quite the investor emotion of the stock market.  The bond market has recently given reason for questioning things.  Instead of interest rates continuing to rise as they did in the first quarter, they have rather dramatically turned back toward the lows.   And margin rates for investors (borrowing on securities) is back to high levels, it has been reported.  We are also hearing, as expected, that sometime soon that the Fed is going to cease the active bond-buying SUPPORT action that it began when Covid struck.

I have said a number of times that I don’t really predict the stock market over shorter time frames.  But I do assess the risk. We have returned to levels where I think the risk is fairly high and while some indicators look strong, others are showing reason for caution.  I feel like I say this somewhat some regularity, but it will be interesting to see what happens over the next few weeks.

Prayers for the difficult situation in Afghanistan, as well as those in Haiti affected by the earthquake. There are many that are hurting and struggling during this time as we witness a relatively strong stock market.  As well, still many are affected in some way by Covid.  I remain sensitive and prayerful about all of this during this time.  As well, Fall is my favorite time of year and I see it quickly approaching, so I am in a good mood. . . but I suppose I am generally in a good mood in life, regardless.  I hope things are very WELL on your respective “fronts”.

And it remains a pleasure and a privilege to be serving the financial advisory roles that I serve for you. We continue to give it attention and we take it seriously. Thanks for the continued trust.  As always, I look forward to being in touch.

Key