M Notes: Mon, 8-25

LAST WEEK:

Markets:  Fed Chair Jerome Powell signaled a change in policy might be in the works at the Fed’s Jackson Hole Symposium.  Markets responded positively.  

S&P roller coaster last week:  Down, Down, Down, Down, and Up significantly.  

Fed Balance Sheet:  $6.618 Trillion. 

Fed:   Jackson Hole:  The focus of this Meeting is always the breakfast Keynote the Fed Chair gives on Friday morning.  I listened to the speech as Jerome Powell was giving it.  It had a lot of filler in it:  discussion of past actions and the reasons for those actions, the Fed’s dual mandate, etc.  But there were a couple of phrases that were important:   “The balance of risks appears to be shifting…  (which) may warrant adjusting our policy stance.”   Mind you, Powell did not say they would lower their interest rate at their September meeting, but it appears it’s now possible.  

Fed Minutes:   In their July meeting, the FOMC participants expressed concerns to both parts of their dual mandate (Inflation & Employment).  While they made no changes to their interest rate, the vote was not unanimous.  While it’s rare to have more than one dissenting vote, this time there were two (10-2).  

Housing:  Starts were up +5.2% in July and were up +12.9% Y/Y.   Existing Home Sales were up +2.0% in July and were up +0.8% Y/Y.  

Jobless claims:  The weekly number came in at 235,000.  The four-week average came in at 226,000.

National Debt:  $37.276 Trillion.  (It’s going up about $28-30 Billion/week.)

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THIS WEEK:

Focus of the week:  Inflation.   The Federal Reserve’s key Inflation metric is the Personal Consumption & Expenditures index.  It get updated the end of each month (this Friday).  Expectations are for the Y/Y number to remain at +2.6%. 

Calendar:   New Home Sales (Mon); Durable Goods Orders (Tue);  GDP, Jobless Claims (Thu); and the PCE (Fri).

Earnings:  This current Earnings Season is winding down.  Some of the companies reporting this week are:  Dell, NVIDIA, and the Royal Bank of Canada.

* The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.    The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks.  The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System.  Yahoo! Finance, the Wall Street Journal, Investor’s Business Daily and Barron’s are several of the sources used for financial information. 

* The National Debt figure comes from usdebtclock.org.   

* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.  Consult your financial professional before making any investment decision.  You cannot invest directly in an index.   Past performance does not guarantee future results. No strategy can assure a profit or protect against a loss.  Investments in the securities markets involve risk, such as loss of your principal.