Another week on the roller coaster.
We had a big Thursday up followed by a down Friday.
What we do have this week are more earnings reports after last week’s financial sector produced fairly strong reports. Some of the consumer companies like Procter & Gamble announce this week to see if you and I are still out there spending our dollars.
We get the tech sector with Netflix and Tesla.
I just have to believe that while there is inflation, the consumer has yet to shut off demand.
That brings me to the debate as to what the Federal Reserve has to do to stop inflation.
There is a significant number of analysts who just don’t want to feel the pain.
Their thoughts are that we should sit and wait.
In case you forgot, that was what the Fed did summer before last using the term transitory.
What the real debate is centered on is how hard the landing will be.
Will we get bumped around, or will the landing gear get crushed?
My theory is that the Fed waited too late and they will drive the plane into the ground harder rather than softer.
The next question will be how long will the economy be slowed.
I wish I had a formula that could give me an estimate, but I only have the gut reaction that this will not be that long.
The length and consequence is of course factored by how much pain each of us suffers.
As in the thought that it is a depression if I lose my job or just an inconvenience of higher prices.
I do know though that a friend of mine that operates two restaurants told me that the cost of tomatoes is twice today what it was six months ago and that hasn’t come through the pipeline yet.
Maybe that will be the incentive to get us all to diet this spring since we can’t afford to eat.
You do have to appreciate how much support the market gets when the Standard & Poor’s 500-stock index moves below 3600.
We have had significant moves back north.
Last week was a technical move assisted by significant short covering by market bears.
It is really difficult to find a trend or to determine a bottom.
It has, however, got my attention and my interest list is growing.
Probably an excellent sign that it will only go much lower.
I told a friend lately that you can’t participate if you don’t get on the train, but you can limit how far you go.
