Wealth Watch: Inflation and Interest Rates and Supply Chain Issues, Oh My!

Wealth Watch: Inflation and Interest Rates and Supply Chain Issues, Oh My!

February 15, 2022
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From the desk of Vance Howard:

22-2-15-Buyline

The HCM-BuyLine® is still negative, and the intermediate-term trend is still down. We are sitting on a reasonable amount of cash and 1–3-month T-Bills. The market appears to be stabilizing after a very nasty selloff with the news of Russia pulling back troops from Ukraine. There are still a lot of negatives facing the market this year, with inflation at a 40-year high and interest rates moving up. Bonds are in a clear downtrend, and it looks like this is just the beginning of the pain for bond holders. This goes without saying but expect volatility the first half of 2022. From a chart pattern it looks like we are setting high highs and higher lows on a short-term basis, and this is encouraging.

22-2-15-TLT-iShares

Similarly, wait times for truck drivers are starting to improve in Newark, Miami, Houston, and Savannah. On the other hand, California is not. Could this be due to excessive restrictions?
22-2-15-SPY-SPDR-S&P-500
If this data is correct, it could signal that supply chain tightness is easing. COVID-19 protocols are contributing to tightness, so as COVID-19 eases, inflationary pressures cool. At least this is the hope, now let’s see how it pans out. Finally, we do not see the Fed rising rates .50bp in March; .25bp makes more sense in our opinion.

Vance Howard

This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice. Howard Capital Management, Inc. may maintain long or short positions in the financial instruments referred to and may transact in them as principal or agent. Unless stated specifically otherwise, this is not a recommendation, offer or solicitation to buy or sell and any prices or quotations contained herein are indicative only. To the extent permitted by law, Howard Capital Management, Inc. does not accept any liability arising from the use of this communication. Howard Capital Management is an SEC-registered investment advisor which only does business where it is properly registered or is otherwise exempt from registration. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the advisor has attained a particular level of skill or ability. Past performance is no guarantee of future results.HCM-011222.01

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