Posted on 12/31/2022 8:11:12 AM PST by Kaiser8408a
2022 is one of the record books and not in a Tiger Woods way. Call it a year of pain.
First, the US enacted policies that drove up energy prices (goin’ green) that reverberated through the entire economy in the form of higher prices. Second, The Federal Reserve, in attempt to combat runaway inflation, started removing the excessive monetary stimulus that had been around since Fed Chair Bernanke initiated QE, the seemingly unlimited purchase of Treasury and Agency MBS securities. Janet Yellen continued the massive asset purchases and zero interest rate policies or ZIRP. Now that inflation has struck the American middle class hard, we are seeing Fed Chair Powell doing what Bernanke and Yellen wouldn’t do — remove the monetary punchbowl.
Using Robert Shiller’s on line data, US stocks and bonds have had an awful year, the worst combined year since 1871.
US equity returns have been demolished under the NEW dual mandate (goin’ green = rising prices = Fed tightening).
Let’s see how two of the most famous investment gurus did in 2022, Warren Buffet and Cathie Wood. Buffet’s Bershire Hathaway Class A equity was UP 4% in 2022, while Cathie Wood’s ARK Innovation ETF collapsed by -67% in 2022.
Here is the clinker. The US economy (as well as the global economy) seem dependent on “cheap money” from Central Banks like The Federal Reserve. So the question is … will The Fed pivot? Fed talking heads are saying no, but Fed Funds investors are saying yes to a pivot after June 2023.
Ulysses S Grant was the President the last time the combined stock and bond market was this bad.
(Excerpt) Read more at confoundedinterest.net ...
I still can’t believe your retread butt is still primping the odd little blog.
You are a tiresome old fart...
This coming year may prove interesting.
I hope the storm is greater for the Chinese.
Humblegunner is a nasty, bitter, miserable old man. His posts are nothing but vitrolic and insulting. I’m sure he is angry at God for ever being born.
What about the YoY. I don’t see it in the headline. No YoY?
Hey, I am a vitriolic old man too! I’m mad at God for being born!
Buffet, energy stocks and short-term bonds, everything is fine. Got out of tech over a year ago.
Your mom is a nasty, bitter, miserable old man.
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