Truvestments

“In the end, how your investments behave is far less important than how you behave.”

~Benjamin Graham

Good Morning,

After doing this for going on 40 years I get concerned that I may become boring.  After all, the lessons learned over those decades are not all new.  Very often, they are the same lesson – repeating in a never-ending process, never to be “learned.”

Interestingly, last year – as the haze of COVID and its related shutdowns was still very thick, the markets “topped” on September 2nd – spending until early November meandering back and forth in a “frustrating” trade range.  It was the season as they say.

Impatient investors squirmed with each headline – certain that soon the floor would drop out.  Waiting for the future to clear was, well, shall we say, expensive.  This year, if one noted, the market also “topped” on September 2nd – and has spent the last many weeks chopping through a very frustrating trade range.  This is not something wrong.

Good Morning,

The season of data releases spins up to a much higher speed this week as over 200 companies will report in each of the next three weeks, with 73 S&P companies hitting the headlines this week alone.

Even as the pace quickens, the increases are steadily improving as well – just as suspected in your previous notes.  Expected year over year increases in both revenues and earnings continue their steady expansion.  Having already picked up more than two full percentage points in the boxed data below since earnings began last week, we suspect more is ahead

Good Morning,

What’s missing?  Armageddon.

Sure, recent weeks of price action is unwelcome, sloppy and unpleasant to watch.  Live through it we must, however.  Why?

It is not about what’s now – it is about what’s next.

Out of the Gate

The Q3 earnings season has been chattered about for weeks.  “No way it performs well” the experts say.  “Can’t compete with Q2, no way.” they shout from the rooftops as they rain down concerns, risk and monsters streaming toward us.  Of course it cannot compete!

It is not supposed to and espousing some negative is present because of that simply suggests the speaker does not understand what is unfolding.

“Beware the investment activity that produces applause; the great moves are usually greeted by yawns.”

~Warren Buffett

Good Morning,

Still can’t find the screwdriver in my office.  I am going to tape it to the wall the next time I put my hands on it.  Keeps it easy to get to so I can quickly loosen the screws on the window and get out to the ledge.  Then, there is the jumping part.

(Alarm sounding on fancy Apple iWatch). Oh, wait, I was dreaming.

Ok, I jest.

What a roller-coaster, huh?  I know this will not be greeted with pleasantries – but this is all good.  As covered for months now, trade ranges are a complex animal – and they are designed to do precisely what this one has done – make everyone upset.

The point?  In the near-term, markets make you feel like you are in the jungle hunting your prey.  How far in the jungle?  While there is never a guarantee, the data are falling into place and we are setting the stage for the final battle.

The title today says it all – Closing in on the end of this months long process.

People who succeed in the stock market also accept periodic losses, setbacks, and unexpected occurrences.

Calamitous drops do not scare them out of the game.

– Peter Lynch

Good Morning,

Geez I sure hope someone got the license plate of that truck.  Good riddance to September as a whole.  It delivered just as described in late summer – providing “the worst monthly result since March 2020” according to the financial news channels.  All sorts of terrible headlines are likely to follow as the demons of October’s past haunt the investor.

Today’s quote above is rather timely.

A lot of people with high IQs are terrible investors because they’ve got terrible temperaments.

You need to keep raw, irrational emotion under control.”

— Charlie Munger

Good Morning,

What a week.  The “pre-earnings” roller-coaster continues.  The chatter and the growing problems are becoming incessant.  The louder the noise, the less likely the topic is set to be a real issue.  The real issues of concern are the ones that come out of left field when no one expects them.

“Fear incites human action far more urgently than does the impressive weight of historical evidence.”

-Jeremy Siegel

Good Morning,

Well, this week we have witnessed yet another lesson about speed and fear.  The manic-depressive process of the last many years continues.  A myriad of deep-seeded doubts remain – smoldering just under the surface.  As summer came to a close, we suggested “If you think anyone is too bullish, just give me a couple weeks of red ink and we will see the bulls disappear…”

When an investor focuses on short-term investments, he or she is observing the variability of the portfolio, not the returns –

in short, being fooled by randomness.  

-Nassim Nicholas Taleb

Good Morning,

It was late 2003 and we were just pulling into McDonald’s in Orlando.  We had landed earlier and grabbed a rental car for the week.   It was to be the first trip for Max to visit all the Orlando Theme parks.  Disney, the water parks, Sea World – the whole library, LOL.  Max was fresh off seeing Finding Nemo – 12 times I think – and we were on a hunt to, well, “find Nemo, Dad…”

I was in the middle of parking the car and my cell phone rang.  I finished parking and grabbed the call just before it went to VM.  I said, “Hello…”, and then there was that pause and some static – the same pause you get when you know it is a call from overseas.

“If I’d only followed CNBC’s advice, I’d have a million dollars today.

Provided I’d started with a hundred million dollars.”

~Jon Stewart

Good Morning,

Ahh yes, this one will leave a mark.  Don’t fret, I wrote down the license number of the truck that will hit the market this morning on the open.  The title implies that things will get a good jolt this morning.  If there was any sense of remaining summer haze, that will be all but eliminated when you get the smelling salts boost after what looks like about a 700-point “adjustments on the DOW this morning.

With the weak open today – here and across the globe – we have officially “entered” the price bands covered last week in a couple of your charts.  Mind you these are just technical targets.  Those ranges drawn were not intended to imply a given but should provide a real battle for good and evil.