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It’s all about earnings & interest rates.

February 04, 2022

Remember, the only choice is optimism, the pessimists never get it right.

No problem can be solved until it is reduced to some simple form. The changing of a vague difficulty into a specific, concrete form is a very essential element in thinking." ...J. P. Morgan

Last week, I wrote about the long history of the S&P 500. It showed that, in spite of historically major declines, the S&P 500 continues to reward patient investors. Last week was no exception. After 3 or 4 losing days, all the major indices posted gains for the week.

The major financial institutions began the earnings season with strong results. While some of the issues we face are big boulders blocking our view, the free market will continue to adjust and help solve these problems, if left to their own devices. The fly in the ointment is policy change, (Read that as higher taxes and more regulations.)

The supply chain is one such problem and it is leading to some empty shelves and could lead many of us to a somewhat disappointing Christmas. Eventually, economic demand will inspire "a specific, concrete form" on how to move forward. When that happens, solutions will be found and the world will continue to exist. The attached article, "Supply Chain Issues" is an excellent read about what the problems are and what the corrections going forward might look like.

I want to add a footnote to J. P. Morgan's quote. At the present time, there is no way Washington DC can be reduced into a specific form. There is no doubt we are in a recovery and continue to work out the kinks. Who knows what may come out of Washington and how it might affect the economy? Where's J. P. Morgan when you need him?

Always, should you have any questions or wish to meet with or talk with me, please don't hesitate to email, or call.

Link to article…