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The Gift that Keeps on Giving...or NOT.

| November 20, 2023

        The consensus in news articles and elsewhere seems to be an adamancy to hype up a stock market rally. I’ve discussed the danger of falling for the narrative of soft landing for the past year, and I’m now letting the charts do the talking.

       One last thing, according to Investopedia, a rally is a period of sustained increases in the prices of stocks, bonds, or related indexes…usually involves rapid or substantial upside moves over a relatively short period of time¹. If after reviewing the chart, you somehow manage to interpret a stock market rally, post the most aggressive fiscal stimulus our Country has seen, then it would explain why the Federal Reserve has moved to a hawkish pause ², whatever that truly means.

       They have good reason to be worried. Besides a financial depression, there might be something much worse than a recession or a stock market crash, and in my opinion that would be a prolonged period of no growth.

       Why? Because growth is a function of price and value, and neither has adjusted. And the only end I see to a prolonged period of no growth is a recession. Well, isn't that a full circle...

       What I’m illustrating for you here are the S&P 500, Dow Jones Industrial Average and the Nasdaq Composite indexes, from 11/20/2021 through the time of this writing, 11/20/2023. Notice the 2-year period of negative total return, despite the much talked about rally, and even though I purposely included the Christmas gift of December of 2021, when the stock market indexes reached their peaks.

       That gift stopped giving immediately after. 

¹. Rally: Definition in Markets, How They Work, and Causes (
². Fed Stands Pat on Interest Rates: What the Experts Are Saying | Kiplinger