To say you needed to be strapped in or get hurled off your seat from the roller coaster ride we experienced last week is not hyperbole.
The S&P 500 looked like it would drop below 7300, only to recover within shouting distance of 7500. Earnings reports from the likes of Apple and Amazon were the bell cows for the markets.
With earnings season winding down, the theme seemed to be companies were making money, but spending at an enormous level.
Conservative future projections of earnings sent shares plummeting.
The Mag 7 produced universally positive earnings.
What I found interesting were the reports from recent laggards such as Microsoft.
The software industry was almost tossed on the junk heap on the thought that AI would eliminate the need for software.
While Microsoft bucked the trend, IBM was punished.
It seems that you can’t make generalized statements about companies in a particular category.
This was all happening at the same time that the conflict in Iran continues toward an endless cycle of conflict then negotiation.
Of interest was the possible truce between Israel and Hamas as it relates to the Gaza strip.
I am a bit skeptical, but it is sort of talk over conflict.
It does seem that each time there is a peace initiative, it only lasts and then more fighting.
Sort of like the time between rounds in a boxing match. Whatever is happening in the Middle East, crude prices have come back down to have WTI below $80 per barrel.
That is far from where we were in January with WTI in the $60 range but it doesn’t hurt my feelings. Remarkable though how long it takes for prices to come back down versus how quickly fuel prices rise.
For all the concern over inflation, I am amazed at how vibrant the economy has maintained itself.
The public seems to be moving on with their lives.
I know it must be cutting into peoples lifestyles but it is hard to detect.
GDP is still below 4% and inflation is over 3%.
I wish I could make the numbers work in my head but such math is beyond me.
It is not like there isn’t some new expansion in one sector or another announced almost every week.
That is not to say that there are not closures.
Such is the life in a free enterprise economy.
What it does tell me is that all boats float in a rising tide.
That is not to say that all is perfect for this economy. Anyone can see the problems with the national debt and underfunding of various government programs.
The political will to solve such is just not there.
It is much easier to kick the can down the road.
While I am a big believer in free enterprise and less government, I am enough old school to know you have to pay your bills.
The grim reaper will come calling one of these days.
It will be laughable to watch each side blame the other and the public will be left to pay the bill.
All I can think of is that I find it remarkable that this market can be this strong with so much to distract.
It does make you want to give credence to the market climbing the wall of worry. The lists of concerns would fill out the Dead Sea Scrolls, but here we are near all-time records.
I unfortunately cannot ignore what I see but I also have come to feel that we have more time for this market to run.
I am completely void of hope for next year but that is a lifetime away.
I know that my options-trading friends appreciate the volatility of this current market.
You can make money on either direction.
That assumes you have chosen the right side.
I can promise you that it mirrors gambling.
Only about 5% actually make real money.
It is a very tough business. So here I sit, trying to be patient and waiting for the next opportunity.
It is such a good thing for me that I like hunting, fishing and golf to distract me.
Otherwise, my impatience would have cost me significant amounts of cash. As one of my old trader friend was want to say, “The best trades are more times than not the ones you don’t make.”
