September Stock Markets Suck, But They Don’t Have To
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Sarcastically speaking, it’s a bit humorous how the recession vibes from early August have almost disappeared by the end of the month. That’s how all of this works, in case you didn’t know. A recession is coming, it’s ever-closer with each passing week and month, but that doesn’t mean it arrives every month. What we generally experience is the natural repetition of “growth scares”. These growth scares that occur during an economic expansion cycle are normal; they are to be expected, but also largely ignored unless accompanied by an exogenous shock. It’s why I (Seth Golden) wrote this soliloquy on August 1st (screenshot below), recognizing the probability that the fears surrounding the economy would likely manifest in downward prices for the stock market. As an investor, if knowing these probabilities for stock prices, was there anything to do; maybe sell stocks ahead of the declines under consideration?
“Highest PPI/CPI/PCE in 10-years, ends with longest government shutdown in history, 4 rate hikes, passive QT, Retail Sales -1% (December), highest layoff rate since 2010… no recession next 12 months. Do you really think it’s even as soft as 2018? I’ll take the under!”