Cuts aren’t happening
 

The inflation rate was 2.9 percent last month. There isn’t a chance rates will be cut. That said, the market can and does move without Fed action.

"One of Berkshire Hathaway chairman Warren Buffett’s favorite market metrics is flashing a warning sign.

The Buffett Indicator, which calculates the ratio of market cap of all U.S. publicly traded stocks to the country’s gross domestic product, is at the highest level in several decades, according to research from Kailash Capital Research. As of November 2024, the figure reached 230%, the highest on record, according to Kailash’s data. That type of market dynamic hasn’t been seen since March 2000 around the time the dot-com bubble burst. Back then, the market-to-GDP ratio had reached a record level of 175%."

From: The stock market gauge named after Warren Buffett just hit an all-time high, sending a warning worse than before the dot-com bubble burst

I try to NOT be on the wrong side of Mr. Buffet's advice.

Not after today's AI meltdown. Apple was up. If the Chinese are being honest, Apple may have access to much less expensive technology.

You are correct. I did not expect the Chinese to announce a revolutionary new AI model which requires far less power and hardware. But based on the sell off I wasn't the only one.

Apple was lucky or Tim Cook had some good inside information. Either way it should be great news for Apple if all the hype turns out to be valid.

TAX REALITY. The TAXMAN DROOLITH over YOUR MONEY. If, you go into cash, You not only pay capital gains, might be payin the lower longterm rate on the gains. As CASH the interest is taxed at the higher short term rate.

I'm not a tax advisor. Must be done properly. If, you have a retirement plan-IRA and are dealing with RMD, forced withdrawals, you can give all you are forced to withdraw or some of it to a 5013c charity and you pay no tax on what you donate.

SOMEONE pays for all that stuff when people think, the government should pay for it. Government for the people, by the people etc. The people is WE.

:mademyday:
back to within 3 points of the all time high close. .

Q4 earnings are positive overall, with the SP500 up over 10% year over year.
Interest rates are holding fairly steady, wiggling up and down. . .
January economic numbers reported in February are always a bit erratic, as there are annual restatements and have funky seasonal adjustments, making February all in all a bit more volatile and not very directional.

Valuations are high, but its a positive seasonal time of year.
AAII bullish sentiment has fallen fairly quickly, indicating fear of loss has overtaken the joy of gains. however, that's mostly a contrary indicator, so good for the moment.

Since January, we have had a political regime change, and its a bit early to figure out the market impact, and likely people won't have a good handle on it until the first quarter earnings which will reflect any tariff and operational impacts. .

So, holding current long positions is the best course until the future becomes less uncertain. It will never be certain, but the future can become less uncertain.

good luck, we need it. .

short term machine learning is forecasting some higher highs on the SP500 over the next two weeks. . then :shrug:

Looks like will finally find out if tariffs are as evil as we were taught in school growing up right before most of factories and steel mills were shut down.

The Day the U.S. TV Industry Died - IEEE Spectrum.

S&P up almost 3% since this thread started.


:icon_hungry:

Will the sell off continue Monday?

Not much of a sell-off...............average volumes.

:icon_bored:

It wasn't boring Friday.

Was wondering if the threat of 25% tariffs could be a factor. if they are implemented I hope they are phased in.

Preparing for a big selloff?

I'm sensing an above average chance of a correction coming up.

What's the average investor to do?

As Dorothy Parker said each time her doorbell or phone rang, “What fresh hell is this?”

I quote Dorothy on a regular basis these days as we are now in seriously uncharted waters, getting farther from the shore.

I am a buy and holder of stocks but also have been parking cash in a government money market fund and have been glad to see some sideline interest on that. (Yes. I know it is taxed differently from cap gains and dividends, but even so, a little return on cash has been better than nothing.)

But I gotta tellya, I now am beginning to have concerns because I do not want to look in someday to check accounts and find my MM account with its treasuries, etc., has been magically turned into Bitcoin or its ilk…….

Hyperbole? Maybe. Maybe not.

Those of us who were little kids in the days of the original “Mickey Mouse Club” on television should remember how each day of the week had a different theme. Well, my fellow boomers, every day is now “Anything Can Happen Day.”

Boomer

One of the key indicators of the current mania, is Microsoft's CEO pulling back on future CAPEX developing AGI, (Artificial General Intelligence) and cancelling some future data center contracts.

So just a warning about the frothiness of the current market at ATHs.

Just a seasonality warning:
https://x.com/WayneWhaley1136/status...18664772182070

A NEGATIVE FIRST THREE WEEKS OF FEBRUARY

The "First 3 Weeks of February" were down 0.45%. Since 1950, if the First 3 Weeks of February were negative, the following year (Feb21-Feb21) was a very normal 21-12 for an avg gain of 6.21%. But there is an interesting story behind those statistics.

In search of Bear Market Warning signals, I once requested of my computer that he scan every time span in search of those that had a statistically significant track record of forecasting a double digit down following year. It provided me with a handful worth following, one of which was the occurrence of a "Negative First 3 Weeks of February".

It turns out that all eight of the S&P, post 1950, double digit down, Feb21-Feb21 years were preceded by a Negative First 3 Weeks of February. Note, that a "Negative 1st 3 Weeks of Feb", preceded most of the three 50% Bear Markets of my lifetime, 1973-74, 2000-02 & 2008.

Billy Bull points out that in 12 of those 33, 'Negative First 3 Weeks of Feb' cases, the following year was double digit positive. So, if you are of a bullish persuasion, feel free to blow this study off as simply an aberrational product of an overly, ambitious, data mining exercise.

But if you are of the opinion that conditions are in place to give the S&P some problems in the next 12 months, the fact that all eight of the prior, post 1950, double digit down, Feb21-Feb21, years were each preceded by a "Negative First 3 Weeks of February", might give you additional reason to pause.

One of a dozen Toy (Turn Of the Year) Stories shared with my commentary subscribers this year,
waynewhaley.witterlester@gmail.com