Good Evening, I’ll keep this short tonight. It’s late and I’m tired. The short story…..is there a short story?? Well I’ll just have to do the best that I can. Every time you think things are normal again it’s like welcome to the age of Covid 19! I made it 22 months without so much as having a cold. Really! That’s probably a record for me, but the inevitable finally happened. I got a sore throat. So I thought to myself should I go to the doctor? It could be strep, but if I go they’ll think its Covid! The dreaded delta variant!! They’ll lock me up in segregation (SHU) and throw away the key. You transgressor, how dare you get sick. Don’t you know there’s a pandemic going on??? There’s no getting sick during a pandemic!!! So I went, after all it could be strep and I may need an antibiotic. Nurse: Where have you been what have you done? Me: I went out for my anniversary….Nurse: .Was it crowded….Me: Well it was Gatlinburg…..Nurse: Have you been vaccinated, if so have you had both shots? Me: Can I please just have my antibiotic…..Nurse: We have to test you for Covid first……Me: I promise I’m innocent , I’ve already been there done that…..Nurse: lean back your head this may irritate you or make you sneeze, some people don’t do so well with it…Me: Oh Nooo, can I please just have my antobiotic…..Nurse: We’re testing you for flu and for Strep also, after all you know it’s going around…. Me: Are you kidding me something beside Covid , now that’s a revelation….. Nurse: just wait here and we’ll come back with the results and here’s a tissue that Covid test makes peoples eyes water for some reason……Me: I wonder why? OK, I’ll wait…..Nurse: (30 minutes later) your negative for strep and the flu and we’ll let you know about the Covid test, don’t worry about that….Me: don’t worry about that?…… Nurse: Oh and by the way here’s a prescription for an antibiotic, the doctor thinks you have sinus infection….Me: Hallelujah What did I learn? Test for Covid first and ask questions later!!! All I can tell you is get sick at your own risk and if you do block off twice as much time on your calendar. So what about the market?
I can hear it now. Scott, you got out and now it’s going up? Yes, and it could continue, but I really don’t think so. The risk/ reward ratio is just simply not favorable right now. You have the above mentioned delta variant on one hand and on the other you have the Fed that’s threatening to start tapering their monthly bond purchases soon. Now that last issue is a volatile one. The last time they started to do this before the pandemic they had a rather nasty sell off better known to investors as the taper tantrum. I vowed then that if I ever heard the word taper again that I would sell and wait. Well all I can say about that is that I’m good to my word. So lets get back to this week. The market has gone up two days. Will it continue? I’m not willing to bet on it one way or the other and here’s why. Friday is the Economic Symposium in Jackson Hole Wyoming. What is that you ask:? Each year since 1978, the Federal Reserve Bank of Kansas City has sponsored a symposium on an important economic issue facing the U.S. and world economies The biggest address at this yearly event is always made by the Chairman of the Federal Reserve and is almost always a market moving event. More often than not the Fed has used this platform to make big announcements. Whether they will this year or not is anyone’s guess, but I can tell you one thing for sure. Investors will be clinging on every word that has anything to do with tapering. Now how they will react to it is a guess as well. However, given the reaction of the market to discussion of tapering in the past I wouldn’t want to be invested at that time. I certainly wouldn’t bet against some spirited selling if indeed it is mentioned. Right now the scuttlebutt is that the FED may announce some tapering in September or October. Just the mere mention of it caused the selloff last week. So you see why we are being cautious. When the dreaded T word is finally announced we will have to pay special attention to how the market reacts. While we expect the reaction to be negative it could be just the opposite of that. The Fed is pretty smart and if they can word something to keep the market happy they will. Never underestimate them. For instance if they were to announce that they would be tapering a small amount and very slowly, investors could think that’s not so bad after all and rally from there. You just don’t know. What we do know is that this talk led to a big selloff last time and we think is likely to do so again. If it does then we’ll buy in near the bottom and make a nice profit. If instead it rallies we’ll buy back in when we can and add a little to an already nice year. There’s only one scenario where we would lose in 2021 and that’s if we stayed in the market now and then it sold off strongly on a taper announcement. What was it that someone mentioned this week on the Facebook page, Better Safe Than Sorry. Yeah that’s it, but what really applies to our philosophy here is our motto “It’s not what you make that’s important. It’s what you keep!
The days trading left us with the following results: Our TSP allotment was steady in the G Fund. For comparison, the Dow added +0.09%, the Nasdaq+0.52%, and the S&P 500 +0.15%.
The days action let us with the following signals: C-Buy, S-Buy, I-Buy, F-Hold. We are currently invested at 100/G. Our allocation is now +16.6% on the year. Here are the latest posted results:
| 08/24/21 | Prior Prices | ||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 16.6499 | 21.064 | 67.3992 | 85.2241 | 39.3792 |
| $ Change | 0.0006 | -0.0354 | 0.1011 | 1.0064 | 0.1720 |
| % Change day | +0.00% | -0.17% | +0.15% | +1.20% | +0.44% |
| % Change week | +0.01% | -0.12% | +1.01% | +2.76% | +1.79% |
| % Change month | +0.08% | -0.26% | +2.18% | +0.72% | +1.37% |
| % Change year | +0.86% | -0.62% | +20.55% | +14.86% | +11.28% |
