The Fed’s “Real”ly Hurting Risk Assets

Stock markets moved sharply higher into mid-August, hoping for a shift towards an easier Fed in the fourth quarter and in 2023. Real interest rates were falling into Chairmen Powell's speech in late August. Jerome Powell's 8-minute speech at Jackson Hole on Friday, August 26th, threw cold water on that. The Fed's September 22nd FOMC release and the question-and-answer session that followed with Chairmen Powell put further upward pressure on real interest rates and downward pressure on all risk assets. There was only one winner on the day. The U.S. dollar hit a new decade high. For now, the dollar remains the world's currency of safety. Click here for more!

Turn on the financial news, and you’re bound to have heard the stories for at least 2 weeks already. The story that seasonally speaking, the month of September has been the worst month for stock returns historically speaking. Going back to 1928, the S&P500 is up only 45% of the time with a negative average return of about -1.1%. Midterm Presidential years, like we are in right now, show pretty much the same results, up less than 50% of the time with an average negative return of also -1.15% before getting into the historically seasonally stronger 4th quarter. Third quarters tend to go out on a down note and are not very promising at first glance. However, this short-term pain usually creates longer-term opportunities for investors.

If you have $500K or more and would like a partnership with a firm to help you manage your investments and financial plan as in these videos, click on this link to connect with our advisors: https://click2retire.com/3BYsB0P