Volatility!

Many indicators that the Bull and his partners follow are signaling the likelihood of increased volatility in the next few months. It bears mention that historically, August through October, have often been volatile in the stock market. At present, money flows are weak, speculation is rife, and some government support for the economy is rolling off.

As the Bull has written many times, it is doubtful that any downturn will be too serious. The economy is doing well, much better than expected at this point, and there is tremendous liquidity in the system. However, markets have bouts of anxiety laced with fear. The Delta variant of the corona virus is causing concern.

Last week’s blog discussed just this with the conclusion that we might be closer to herd immunity in the U.S. than popularly believed or entirely understood. We shall see, but the underlying business momentum should more than carry us through. In recent earnings reports, corporate performance has been far better than expected. Almost 88% of the companies reporting are meeting or exceeding expectations. Businesses along with individuals are flush with cash. In fact, these measures are at record levels and is potential buying power on any sustained decline.  Remember, volatility and downturns are buying opportunities. We are prepared; stay steady my friends.