This week, we’re reading articles on bond vigilantes, negative stock market coverage, why optimists are the best investors, and more!
Each week, the Stokes Family Office staff puts together a list of our favorite news and updates on all things wealth management. From financial planning, portfolio construction, tax and estate planning, retirement plan services to anything we found interesting. Enjoy this week’s curated list for your weekend reading!
ECONOMY NEWS
- Corporate Net Interest Payments at Record Low Levels Despite Fed Hikes
- Fed hikes had a limited negative impact on consumers because of locked-in low mortgage rates and a very small impact on corporates because of locked-in low interest rates and rising earnings.
- We Need to Have a Talk About “Bond Vigilantes”
- Cullen Roche says the bond vigilante narrative is overblown, although it doesn’t mean we shouldn’t worry about government spending and inflation.
- But we also shouldn’t feed into hyperbolic narratives about how the USA is on the verge of bankruptcy.
- Slow M2 Means Low CPI
- Scott Grannis links rapid M2 growth (i.e., money printing) to the big inflation problem that hit the US economy beginning in the first part of 2021.
- He has four charts showing so far, nothing out of the ordinary seems to be happening, and that implies no unpleasant inflation surprises for the foreseeable future.
MARKETS NEWS
- The Stat Explaining Why the Stock Market Gets So Much Negative Coverage
- Sam Ro writes that despite historic prices being in bull market over 80% of the time, negative stories tend to draw more audience interest than positive ones.
- But there’s another much simpler explanation for news negativity: the stock market experiences a lot of down-days.
- 3% Stock Market Returns For the Next Decade?
- Ben Carlson digs into Goldman Sachs’ research piece that posits the S&P 500 could return just 3% annualized over the next 10 years.
- He looks at rolling 10 year returns for the S&P 500 going back to 1926 finding roughly only 9% have been 3% or less.
- Optimists Are the Best Investors, Even If the Pessimists Sound Smarter
- Looking at returns and economist commentary over the last 5 years, Jim Dahle asks, “Why do optimists sound so pollyannaish while pessimists sound so smart?”
- He says time and time again, the optimists turn out to be right.
Stokes Family Office is 100% Family Owned, and has been continually operating in the New Orleans Area for over 35 years. As a family office, we are focused on family wealth, financial planning, and tax planning. We are your local experts for Gulf South wealth management. Want to hear more from our team? Check out the Lagniappe Podcast.
