Strategas

Trees Don’t Grow to the Sky

Trees Don’t Grow to the Sky

When my family gathers around the holidays, we enjoy catching up on Jeopardy episodes with our two daughters. As they are both educators, it can be difficult for my wife and me to keep up, but it can also get pretty competitive. In one episode, I had the upper hand as the category was the “Magnificent Seven.” Luckily, this didn’t refer to the movies but to the seven stocks dominating the stock market. In investing circles, the term “Magnificent Seven,” or Mag-7, is well known, and I was surprised it had become recognizable enough to be a Jeopardy category. Unfortunately, while I was the first to “buzz in” and answer correctly in this category, I wasn’t as fortunate the rest of the game.

Mixed Reviews

Mixed Reviews

This week, there was a plethora of economic and company-specific news for investors to digest. Specifically, the release of first quarter U.S. GDP, reported quarterly earnings by major technology companies and the unanimous vote by Twitter’s board to approve Elon Musk’s offer to take the company private. In response to this news, the market declined 4%, with all of the weekly losses occurring Friday afternoon.

Changing Seasons

Changing Seasons

As autumn dawned this week, investors witnessed the first move by a developed market’s central bank to raise interest rates since the COVID-19 pandemic began. No, the Fed didn’t raise rates. Rather, it was Norway’s central bank that moved its short-term interest rate target off the zero bound, citing improved economic activity that no longer justifies such monetary policy accommodation.

Sign of the Times

Sign of the Times

Earlier this week, my family and I were out to dinner when we saw a sign on the front door of the restaurant that read: “Being short staffed is the new pandemic… Thank you for your patience with us.” While we are familiar with the standard “help wanted” signs, specifically in the service sectors industry, you may have noticed a recent addition to these signs: signing bonuses.

Chart-side Chats

Chart-side Chats

Last week marked the semi-sesquicentennial anniversary of Franklin Delano Roosevelt’s death which sparked many to compare our current financial markets to the Great Depression. As the stock market continues its rapid ascent for a second week and pundits start talking about the shape of the recovery, there is one lesson some overlook from the Depression era — the value of FDR’s fireside chats. During these chats, the president used simple, direct language to convey very difficult news; a format we are keeping in mind.

The Circus Is in Town

The Circus Is in Town

Our clients regularly ask about the financial impact of elections, especially as Election Day nears. We do know that, on average, the market is up 11 percent in election years, which is akin to the long-term average return. History has shown that markets (i.e., investors) dislike uncertainty. While