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  • Cautious Optimism
    Plus January 2024 Market Report

    John Gorlow | Feb 15, 2024
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    Following the broad-based Q4 stock rally, investors entered 2024 with both hope and caution. Trading was choppy, but by the end of January, the S&P 500 Index notched several new highs and a third consecutive monthly gain. For the first month of the year, at least, confidence in the strength of the U.S. economy outweighed concerns about monetary policy. Whether that confidence will remain intact is uncertain.

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  • 2023 Wasn’t What We Expected. 2024 Won’t Be Either. Plus Q4 Market Report

    John Gorlow | Jan 17, 2024
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    Perhaps the most predictable thing about 2023 was that most market predictions would be wrong. Many pundits foresaw a recession, a stalled economy, stubbornly high inflation, job layoffs and more. Instead, the U.S. economy proved to be remarkably resilient, rewarding investors with a stunning stock rally in the final two months of the year. Markets were lifted by a raft of good news, including inflation falling faster than expected, strong U.S. economic output, and a healthy labor market. Driving the year-end surge was the belief that central banks are done with interest rate hikes and will soon begin rate cuts. How that story unfolds remains to be seen.

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  • Soaring Markets Challenge the Fed
    Plus November Market Report

    John Gorlow | Dec 08, 2023
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    Investors celebrated a blockbuster November as markets posted their biggest monthly gains in more than a year. The news was superb, as bonds posted their best monthly performance in nearly 40 years and the S&P 500 index returned a whopping 9.13%. For many, it felt like the stars aligned and their dream-scenario was coming true as robust growth, diminishing inflation, and slowing job growth pointed to a gentle landing and an end to rate hikes. But like the morning after a blow-out party, there may be a price to pay for all that enthusiasm.

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  • Hope Blooms on Inflation News
    Plus October Market Review

    John Gorlow | Nov 20, 2023
    JohnGorlow_26593

    Holiday jubilation came early to Wall Street last week as positive news about inflation led to a third straight winning week. The overall Consumer Price Index for October dropped to 3.2% annually from 3.7% the previous month—and from a peak, in this business cycle, of 9.1% in June 2022.

    At the same time, core inflation, which excludes fuel and food prices, fell to 4% in October, the smallest increase since September 2021. Bond prices rallied sharply, as the yield on the 10-year Treasury dipped to 4.43%. A few weeks ago, it was above 5%, its highest since 2007.

    Investors’ hopes for a Fed pivot towards lower short-term interest rates fueled the benchmark S&P 500 to rise sharply, climbing nearly 10% from its October lows, and propelled year-to-date returns on the bellwether index to more than 19%.

    Time to pop open the champagne? Depends on what data you’re digesting. On the one hand, soft jobs data, slowing inflation, and a resilient economy are rekindling hopes for an economic soft-landing, which seemed nearly impossible a year ago. On the other hand, a more troubling downturn could be on the way. Some analysts predict large ripple effects from rising commercial property market foreclosures and a coming wave of corporate bankruptcies. Mounting debt-refinancing issues face even the most powerful private equity firms, and could lead to deeper problems for investors.

    What we’re seeing now is great news, to be sure, but it doesn’t mean we’re out of the woods yet. Even Fed Chair Jerome Powell acknowledges this. All of which is to say, hope is warranted, but maybe not too much. Keep that champagne on ice.

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  • The Crux Of The Matter
    Plus Third-Quarter Market Review

    John Gorlow | Oct 20, 2023
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    Mixed messages rattled the U.S. bond market last week. First came hints from some Fed officials that further rate hikes may not be needed. Investors cheered the news and bonds rallied. But by mid-week, hot inflation data threw cold water on investors’ hopes and the bond rally turned into a sell-off as bond yields rose. By the end of the week, global concerns about the expanding Middle East conflict caused bond prices to rebound as investors searched for a safe haven. But the ping-pong game wasn’t over yet.


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  • An Antidote to Gloom
    Plus August Market Report

    John Gorlow | Sep 19, 2023
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    Here we are, nearly three-quarters of the way through 2023, and the markets continue to defy the pessimists and pundits who predicted a recession, a tanking economy, and big job losses as a result of the Fed’s aggressive series of rate hikes. None of that has happened as of mid-September. Of course, it still could.


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  • It’s Time for Investors to Act (and Save Money)
    Plus July Market Report

    John Gorlow | Aug 15, 2023
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    It’s hot, and getting hotter. July 2023 was the hottest month on record, capping the eight hottest years on record globally. If you were among the millions of Americans at the boiling point, suffering from severe weather, disruptive blackouts, or skyrocketing energy bills, you may wonder what can be done. Here’s a viable alternative to inaction: You can strengthen your own economic resiliency and make your home a haven of efficiency. No matter what side of the political aisle you’re on, there’s an investment case to be made for choosing energy self-reliance. And now is the time to do it.


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  • Markets Bloom on Cooling Inflation
    Plus June Market Report

    John Gorlow | Jul 21, 2023
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    When June inflation data was released last week, you could almost imagine Fed Chair Jay Powell shouting like quarterback Patrick Mahomes after marching his team to a touchdown with no-look passes and fifty-yard bombs. “This is what I do! this is what I do!" Whether the Fed is unusually skilled or just lucky, investors cheered the indisputably good news: a year-over-year dip in inflation from 9 percent to just under 3 percent. While those who ridiculed Powell’s earlier “transitory inflation” comments have fallen mostly silent, it’s true that the last mile of inflation may be the hardest to tackle. Investment bankers and hedge fund managers caught in defensive positions have some explaining to do, but continue to warn, “Just wait, this won’t last.” Perhaps they’re right.

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  • Does AI Know What Markets Know?
    Plus May Market Report

    John Gorlow | Jun 16, 2023
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    If you need a reminder that markets don’t behave according to predictions, look to the first five months of 2023. A string of U.S. banks went under, and a debt ceiling fight threatened to undermine the financial credibility of the United States. A wave of interest rate hikes failed to stamp out inflation, leaving a smoldering fire ready to reignite. Dire warnings about corporate earnings filled the airwaves. And yet the S&P 500 gained about 14 percent through mid-June, mostly on the back of risky tech assets. Let’s unpack the issues, then take a look at May markets.


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  • A Dangerous Impasse, Debt Ceiling Standoff
    Plus April Market Review

    John Gorlow | May 18, 2023
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    With the clock ticking, the U.S. government could default on its debt obligations within the next four to six weeks. Unlike most catastrophes, this one is predictable and preventable. A default would wreak havoc on global markets and deeply undermine the reputation of the U.S. as a haven for investors. Many believe it would tip the country into recession. Let’s look at what the markets are saying about the scene now unfolding in the U.S. Congress.


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