Good morning.
Another day, another inflation concern … yet stocks are trading higher so far this session. It is tough to figure out especially in light of a Bloomberg comment that market expectations on rate cuts this year have been reduced to “one” … with the odds of a cut taking place at the March meeting now “near zero.”
On top of this … as if that wasn’t enough … Donald Trump is now saying there will be “reciprocal tariffs” announced today as the game of “… we tariff you, you tariff us, how dare you …” continues. And still so far today, investors are yawning … but for how long?
By the way, I love creative headlines … and in the direction of one posted yesterday in the Wall Street Journal I give great applause as “Inflation Heats up in January, Freezing the Fed” tells so many different stories all with one simple jotting. I didn’t even need to read the article beyond the headline to know what is going on … along with the probable reaction (or non-reaction) by Jay Powell and team.
I often write about my concern over things which may appear non-economic, but upon review have a great deal of effect on all of us.
There were two items falling into this category this morning.
I didn’t include it, but the CBO put out a note on Daily Shot which shows the population of the U.S. is now projected to be lower even than what was forecasted to be just one year ago. The “replenishment rate” is around 2.1 children per female in order to keep a population steady and we are fast falling to around 75% of the number. Sorry … but I feel the government must get involved and if the reason is financial, they should produce an incentive to increase this number. If we don’t … and the day is rapidly approaching … we will all pay the price. Literally.
But does any of this matter? Maybe not.
If you haven’t heard, there is a small possibility of an asteroid hitting our planet sometime in around 7 years. While the odds given were small, what was once seen as miniscule (1-in-87) has now changed with chances increased to 1-in-43.
What if the odds double again … and once again … and then again? Well, it will be time to start to dial up the worry meter.
My grandfather was a very wise man, and he often said that he thought humanity would go the way of the dinosaur and end with a meteor striking the planet.
He was a wise man indeed … with many thoughtful views.
How I’ll always remember his last words to me … given on that sunny spring day … when he said …
“don’t shake the ladder.”
Have a great day,
Joseph G. Witthohn, CFA
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