Moving Day
Posted on Sunday, August 1st, 2021
We moved our daughter – again. It seems like she moves once a week. This was it though. As she was homeless and moved between apartments it made for a seemingly endless process. We moved her in this morning. We arrived home exhausted. I have to say it was also a bit sad. This will be her last apartment in college and then off into the workforce. Where will she go? Athens? Raleigh? Chicago? Who knows? But you can’t help get that feeling that the little bird is leaving the nest permanently soon. I must admit I am feeling a bit old this week.
For a week marked on the calendar for some time as a potentially busy week it was a bit of a snoozer. There were stellar earnings reports but the market was expecting those and sent shares of many of those companies lower. Federal Reserve Chair Powell spoke mid week and the market passed on it’s usually fireworks in response. It seems as though most market participants are at the beach.
July marked the 6th straight month of increases for the S&P 500. The market has now gone 185 days without a 5% decline. That is one of the longest periods without a 5% decline in the last 100 years.
While there has not been a 5% decline in market averages there have been a stealth correction going on underneath the surface. According to JC Parets at All Star Charts the average drawdown from its highs for a stock in the S&P 500 is 8% while the average stock in the NASDAQ is down 18%. How can this be? The largest of the large cap stocks are holdings up the averages. According to JC he is not waiting for the correction. The correction is already happening.
The next six weeks may be critical. August and September are the worst one two punch on the calendar and we expect market returns to mimic prior years. However, our indicators are still just on yellow alert.
I think we aspire less to foresee the future and more to be a great contingency planner… you can respond very fast to what’s happening because you thought through all the possibilities, – Lloyd Blankfein
A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty. – Winston Churchill
To learn more about us and Blackthorn Asset Management LLC visit our website at www.BlackthornAsset.com .
Disclosure: This blog is informational and is not a recommendation to buy or sell anything. If you are thinking about investing consider the risk. Everyone’s financial situation is different. Consult your financial advisor.