Down goes the Dow

Headline PCE and CPI inflation now have a 2 handle, on a quarterly basis. A 2 handle. These inflation rates have to start coming down soon. Unless inflation resurges. That's bullish.

(although have to say that core inflation is not budging and that's a counter-argument)

Along the same lines, Powell finished his segment of the presentation, and he noted that the GDP growth was significant in recent quarters and is expected to slow in the coming year. Powell also noted that the rate of inflation has been deceptive somewhat, referring to some "head fakes". He remains cautious but also said the inflation rate has yet to fall to their target rate level and they won't hesitate to raise rates in the future if necessary to bring it into range.

"Semiconductors inventory is at its highest levels since 2001."
- JPMorgan

False.

At all times when providing Financial Advice to a Client, a CFP® professional must act as a fiduciary, and therefore, act in the best interests of the Client.

ol' gente might find this amusing.

Refers to an off-the-cuff comment from powell yesterday

“In short, taking commissions (or loads or transaction-based fees or any of the other names they are called) is mutually exclusive with being a true fiduciary.”

How long did it take you to find an opinion piece?

By the way, Bernie Madoff was a “fiduciary.”

This is written for the normal posters here. In my years in the business, if you were acting with discretion in client accounts, that is buying and selling investments without consulting the client for permission, you were required to successfully completed Series 7, 65, and 66 exams. Such discretionary accounts are charged a fee based on assets under management, and typically 1-2%. An advisor could charge a commission that is cheaper over the short to long term that would be of significantly greater benefit to the client than a fee based account. That commission based account would be in the client’s best interest, and thus meet the fiduciary standard. On the other hand, a fee based financial advisor, could rarely make changes to client accounts, charge excessive fees, use underlying more expensive investments with additional layers of fees, and therefore not meet the fiduciary standard.

To meet regulatory standards of discretionary accounts there are best practices of disclosure, advice, monitoring, and supervision. At larger wire houses this is handled by a compliance department, at smaller firm the rigor and vigor of monitoring standards of behavior may be lacking. Even at larger firms the profit motive of larger fees can drive an advisor to take more risk to justify the fee. As Ken Fisher advertises “when you do better, we do better.”

As is typical, The Troll is more about spinning a narrative, than facts or how the process works in practice. In financial services like other areas of society, standards of behavior are varied, and with money involved, you can run into some of the worst characters. Fortunately it is a highly regulated business, but the fiduciary standard is just what it is. A fee for advice platform does not insure a fiduciary standard, nor does a commission charge eliminate or negate the obligation to act with a fiduciary standard.

Very nice and informative post, Igy. I am rereading it for the third time.

My only quibble since I am a bit of a stickler and relates to your last sentence ...

Assure means to promise

Ensure means to guarantee

Insure means to protect against a contingency.

Again, nice post.

“ensure” would be my intention

LOL. I was listening to the broadcast rather than watching the video, and I heard that comment, which cracked me up big time. But I wasn't sure if it was Powell that said it or someone else. I told my wife the story and she swore up and down that it must have been someone else, Powell is always so professional.

Thx, The story just got even better!

“This is the widest alligator jaws ever observed: Nasdaq breadth at all time lows, while a few Nasdaq companies keep pushing the Index higher.”

—Zerohedge

I would think this is indicative of an early stage of a rally, and later stage would be to branch out to the laggards. Anyway, isn't it time ZeroEdge got with the program and figured out that's the way this market has worked (and prospered) for like almost a generation now?

The post from Zerohedge is a statement of fact, and one can interpret the ramifications of that information as they wish.

getting 'facts' from Zerohedge is like getting 'facts' from politicians...yeah maybe it's true but maybe it's not...and in any case the 'facts' will be clearly shaded to their point of view without any nuance.

Oh come on, leave it at the door.

Look at the chart they are refering to:

There were two major points of divergence, the first being back in early 2021 (pandemic rebound) and these last few months. Other than that, the trend for adv./decliners is similar to the Nasdaq index as a whole.

Think about it. Those two times of divergence both follow a big downturn, and the divergence emerges on the rebound. Simply put, downturns warrant a big buying opportunity, and that is to buy the market leaders, first and foremost. It's the big opportunity to buy the high PE stocks at a slightly reduced price.

EDIT: the exact timing of the first divergence (mid -2021) seems to correspond to the emergence of the extremely high inflation in countries throughout the world. Somehow that punished stock prices of the index in general more than the market leaders.