M Notes: Tue, 5-26

LAST WEEK:  

Markets:  There’s a new sworn-in Fed Chair, and Markets were solidly up last week.  

S&P roller coaster last week:  Down a touch, Down, Up a lot, Up, and Up.  

Fed Balance Sheet:  $6.714 Trillion.  Down $15 Billion last week. 

Fed Chair:   Confirmed by a 54-45 Senate vote, Kevin Warsh was sworn in last Friday afternoon as the new Fed Chair.  That action removed Jerome Powell as the interim leader.  But Powell has decided to stay on as a Fed Governor, which he can do until January 31, 2028.   Powell has implied he will be quiet and take the high road.  Maybe.   If Powell stays on until after November 3rd (the Midterms), this won’t be about “clearing his name”.  Although Powell will probably deny it, it could be seen as an attempting to control the Fed, even though he’s no longer the Fed Chair.   And although Powell’s a registered Republican, this could be about trying to hurt Trump (it’s fairly obvious they don’t like each other) in the Midterms.   

Fed Minutes:   While a few voting members wanted to see the Fed’s interest rate move downward, some other members expressed being open to the possibility of raising rates.  

Housing:  Starts were down -2.8% in April, but were up +4.6% Y/Y. 

Metals:  Gold finished the week at $4,510.  Silver finished the week at $76.

National Debt:  $39.291 Trillion.  

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THIS WEEK:

Focus of the week:  Inflation.  The Personal Consumption & Expenditures index (the PCE) gets updated on Thursday morning.  

Calendar:  Holiday (Mon); Durable Goods Orders, GDP, New Homes Sales, and the PCE (Thu).  

Earnings:  some of the companies reporting this week:  Corning, Johnson & Johnson, TMobile, and Union Pacific. 

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* 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.