In his Daily Market Notes report to investors, while commenting on the strong stock market performance, Louis Navellier wrote:
Q2 2021 hedge fund letters, conferences and more
Strong Stock Market Performance In August
The stock market has been surprisingly strong this August since it exploded to the upside last Friday during option expiration day. Bespoke Investment Group documented on Wednesday that the S&P 500 (SPY) in the past year surged 79.8% during which gains occurred more often on trading days with “below average volume” than on trading days with “above average volume.” That means when volume got light, the market meandered higher. This may explain why the stock market has done so well in August, which is a light month for trading volume.
The short term impacts of events unfolding at the Kabul airport, including the tragic death of U.S. service members, will be to reduce the liquidity in the market. The longer term economic and diplomatic impacts cannot be predicted at this time. Nearer term however, the difficulties in Afghanistan will bolster the perception of U.S. markets as a source of safety in a chaotic world.
No Tax Hike?
One question that I get a lot is if taxes are going to go up because the new spending bills cleared the House. The Biden administration doesn't have the influence it once did with the Congress, and the Senate is not going to approve what the House has passed, so taxes should not be a concern now. The one thing I do want to remind you is that the US economy is growing faster than other economies in Europe, even China, right now.
While the US is an oasis, we do have all these interesting cross-currents going on. The dollar has gained 3.9% against the Euro this year because our interest rates are higher. The European Central Bank is increasing their quantitative easing while the Fed wants to eventually start tapering or curtailing the quantitative easing. I don't expect that to happen in the next year, but the Fed hasn't officially announced it. What happens when things are uncertain is that Treasury bond yields fall. And as bond yields fall, everybody realizes what a bargain the stock market is.
World Facts
The six most surveilled cities in the world are: Taiyuan, Wixu, London, Indore, Changsha and Beijing. In London there are 73 cameras per 1,000 people. New York and Los Angeles have seven and almost nine cameras per 1,000 people. Source: Statista.
