Transcript:
Tom Vaughan:
Everybody, welcome to Wednesday, the S&P 500 was up point 1%. Today, and it was actually pretty good accomplishment considering it was down almost 1% At one point in the day and then recovered, we originally opened up down really probably based on comments that were made by President Biden, after the market closed yesterday, just talking about the Ukraine crisis, and how serious it is the fact that they weren’t really seeing troop withdrawals, those types of things. And so the market opened up negative on those on that information. And then we got the numbers for the retail sales for January, which were very, very good, up 3.8% for January. Now, the weird part about that is that can be actually a negative depending on how you look at, you know, obviously, retail sales are a big part of the economy, the more we have, you know, the more the economy can grow. At the same time, we’re in this inflationary environment, where if we have too much, you know, of the economy too hot of an economy, obviously, the Federal Reserve might have to get more aggressive to slow things down. So the market can move sideways based on that, you know, it depends on the equation you’re looking at there. Personally, I look at this as a positive, mainly because I’m really concerned about recessions. Because if you look at course, average downturn, the S&P 500 is negative 15%. Without a recession, negative 36%. With a recession, recovery time is also much longer with a recession.
So when we have three positive surprise on retail sales for a month, that just means to me that we’re farther away from recession, maybe the maybe the Federal Reserve has to do something about that. But the next big leg up in the market came because the minutes were released from the Federal Reserve meeting that happened back in January. And really, there was no talk in those minutes about or half a point increase in March, we had two other fed governors come out today and interview saying that they were leaning towards a quarter point increase. I think there’s four different fed governors now that have said in different interviews that they’re looking at a quarter point, there is one fed governor who’s done multiple interviews, talking about how he thinks we should do a half a point. And maybe another half a point before Jack July, how many seems to be the only one in that particular camp at this point in time. And so, again, I think the market is already factoring in the possibility of a half a point rate increase. If it doesn’t happen, we might see some positive movement out of the market. So the Ukraine situation, the inflation slash Federal Reserve situation and of course, earnings are the three big drivers right now in this market. And two of those were prevalent today, and really kind of created this situation. So it turned out to be a good day. I think things are okay, as far as that goes. You know, we’ll have to see how things play out and all of these different areas, but altogether, I think, you know, high retail sales number like that should be something we all look at with look forward to seeing what’s gonna happen tomorrow. Thank you very much.