top of page

WHEN WILL THE SELLOFF END? | CROUCH CONNECTION | JUNE 2022 "ADV"

  • tammycrouch
  • Jun 9, 2022
  • 4 min read



WHEN WILL THE SELLOFF END?


As you can imagine, we have been asked this question many times over the past few weeks. We do our best to read and listen to as many different viewpoints as we can, but after 30 years of focusing on financial markets, I have learned to be careful who I listen to.

BAD NEWS SELLS!


Bad news is much easier to sell, and the media are in the business to sell advertising, so you can be sure they will lean toward reporting the negative stories rather than the optimistic viewpoint. Even respected prognosticators like Morgan Stanley Chairman Jamie Dimon, who roiled the markets last week by predicting an economic “hurricane”, could have an agenda that conflicts with your retirement plans. Keep in mind that the bank’s trading department makes huge profits for the bank from volatility in the markets, so always listen skeptically.


I’ve said this before, but the market strategists I respect continue to have a cautiously positive outlook for the market for the year. Kay and I attended the RJFS National Conference two weeks ago and had the opportunity to hear presentations from some of the brightest minds in the business. Among them Larry Adam, Raymond James Chief Investment Officer, Brad Pineault, Capital Markets Strategist at Fidelity Institutional Asset Management, and Phil Orlando, Chief Equity Market Strategist at Federated Hermes.


· Larry Adam expressed optimism at the conference and reiterated in his June 3 weekly letter that “Despite the uncertainty, we believe the Federal Reserve can engineer a soft landing…” citing the health of the consumer. He continued, “the consumer has not stopped spending…consumer balance sheets have rarely been in better shape. Robust job gains, strong wage growth and a significant amount of accumulated savings continue to provide plenty of firepower to support consumption.”

· Phil Orlando highlighted the Presidential election cycle which could provide a much-needed boost. Market corrections are not unusual in the second year of a Presidential term (2022 for Biden). The average drop during a mid-term election year has been 19% (almost exactly what we have just experienced) followed by a 31% rally over the next 12 months, calling the current correction a buying opportunity.

· Brad Pineault delivered one of the most impressive presentations I have ever heard. He cited the same statistics about the mid-term election year cycle opportunity saying, “the deeper the fall the bigger the bounce”. He said the consumer balance sheet has never been stronger. With $25 Trillion in savings and $7 Trillion in home equity (which has doubled over the last two years), he believes a recession in 2022 is very unlikely, and that inflation will likely be down to about 4% by year-end, taking pressure off the Fed to slow the economy.

Eugenio Aleman, the newly named Raymond James Chief Economist echoed the positive view in his weekly letter (also June 3) saying, “We remain in the camp that the Federal reserve will be able to engineer a soft landing and will spare the economy from a recession.”


BUT WHAT ABOUT INFLATION


Again according to Phil Orlando, 61 high-profile companies have already announced layoffs or hiring freezes since February which should take pressure off of rising wages. And according to Linda Duessel, also at Federated, prices for wheat (and corn), gold, and other commodities are well off their highs, with copper, platinum and lumber down year-over-year.


Granted, to anyone who has been to the grocery or filled their car up with gasoline lately talking about falling inflation might seem preposterous, but respected J. P. Morgan global strategist Marko Kolanovic has since repeated the view that inflation has likely peaked on a year-over-year basis which, you would hope, could lead to lower food and energy prices soon.


If that happens, we believe that you would then see the beginning of a strong recovery in the market, possibly the 31% rebound that Phil Orlando suggested could be possible.


BOTTOM LINE


Repeating the recommendation in our last letter, patience has always paid off at times like this. We believe your patience with this market will pay off again. Call us if we can help with your concerns.


Sincerely,


Dave Crouch Kim Blackburn Kay O’Connell

Registered Principal Branch Operations Manager Financial Advisor

Financial Advisor




Buffet Quote:

“In my life, I try and avoid things that are stupid and evil and make me look bad in comparison to somebody else- and bitcoin does all three. In the first place, it’s stupid because it’s still likely to go to zero. It’s evil because it undermines the Federal Reserve System…and third, it makes us look foolish compared to the Communist leader in China. He was smart enough to ban bitcoin in China.”-

Warren Buffett’s partner, Charlie Munger


The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Dave Crouch and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance does not guarantee future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions


 
 
 

Comments


Featured Posts
Recent Posts
Archive
Search By Tags
Follow Us
  • Facebook Basic Square
  • Twitter Basic Square
  • Google+ Basic Square

Visit

3326 Aspen Grove Drive

Suite 602

Franklin, TN  37067

Call

T: 615-778-9842

© 2019

Aspen Grove
Asset Management

book image_edited_edited.png

  Click to Read CRS Document 

Important Disclaimers

AGP Franklin, LLC ("AGP Franklin") is a Registered Investment Advisor ("RIA"), located in the State of Tennessee. AGP Franklin provides investment advisory and related services for clients nationally. AGP Franklin will maintain all applicable registration and licenses as required by the various states in which AGP Franklin conducts business, as applicable. AGP Franklin renders individualized responses to persons in a particular state only after complying with all regulatory requirements, or pursuant to an applicable state exemption or exclusion.

 

Terms of Use

Please read these terms and conditions of use (“Terms”) carefully before using the website located at https://www.aspengroveassetmanagement.com/ https://www.strongtowerwealthmanagement.com/ (“Website”) or any of the information or services provided by AGP Franklin, LLC (collectively “AGP Franklin”, “we”, “our”, “us”) in connection with the Website. By using the Website, you acknowledge that you have read and understood these Terms and accept to be legally bound by them. If you do not accept and agree to these Terms, you are not an authorized user of the Website or any of the information or services provided by AGP Franklin in connection with the Website and should promptly terminate all use thereof. The terms “you” and “your” mean you and any entity you may represent in connection with the use of the Website. You may use your browser to download or print a copy of these Terms for your records.

 

AGP Franklin reserves the right to change, modify, add or remove portions of these Terms at any time for any reason. We suggest that you review these Terms periodically for changes. Such changes shall be effective immediately upon posting. You acknowledge that by accessing our Website after we have posted changes to these Terms, you are agreeing to these Terms as modified.

 

These Terms were last updated on January 21,2025.

 

Risk Disclosure

Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy will be profitable.

 

Asset allocation may be used in an effort to manage risk and enhance returns. It does not, however, guarantee a profit or protect against loss. Performance of the asset allocation strategies depends on the underlying investments.

 

This website is intended to provide general information about AGP Franklin and its services. It is not intended to offer or deliver investment advice in any way. Information regarding investment services are provided solely to gain an understanding of our investment philosophy, our strategies and to be able to contact us for further information.

 

Market data, articles and other content on this website are based on generally available information and are believed to be reliable. AGP Franklin does not guarantee the accuracy of the information contained in this website. The information is of a general nature and should not be construed as investment advice.

 

Please remember that it remains your responsibility to advise AGP Franklin, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.

 

AGP Franklin will provide all prospective clients with a copy of our current Form ADV, Part 2A ("Disclosure Brochure"), Form ADV Part 2B, which is the Brochure Supplement for each advisory person supporting a particular client, and the Form ADV Part 3 (Client Relationship Summary or Form CRS). You may obtain a copy of these disclosures on the SEC website at http://adviserinfo.sec.gov or you may Contact Us at (615) 778-9842 to request a free copy via .pdf or hardcopy.
 

Privacy Disclosures

AGP Franklin is committed to safeguarding the use of personal information of our Clients (also referred to as “you” and “your”) that we obtain as your Investment Advisor, as described in our Privacy Policy.

 

AGP Franklin does not collect personal non-public information through this website; however, the Advisor may collect information from you on application forms, agreements, profile or investment policy statements, and other documents received or processed in relation to services we provide. We also may collect information from other sources.

 

We do not respond to "do not track" requests because we do not track you over time or across third party websites to provide targeted advertising. We may track you across our website to help us improve our content.

 

We may use "cookies" and similar online technologies to keep, and sometimes track, information about you regarding your usage of our website. Cookies are small data files that are sent to your browser or related software from a Web server and stored on your device. Cookies help us to collect information about your usage of our website, including date and time of visits, pages viewed, amount of time spent on our sites, or general information about the device used to access the site, such as the browser used. You can refuse to store or delete cookies by configuring your web browser settings. Most browsers and mobile devices have their own settings to manage cookies. If you refuse a cookie when on our website, or if you delete cookies, you may experience some inconvenience in your use of our website, such as having to re-configure preferences.

 

When you are on this website you may have the opportunity to click-through to other websites, including websites operated by unaffiliated third parties. These sites may collect nonpublic personal Information about you. We do not control sites operated by these entities and are not responsible for the information practices of these sites. This Privacy Policy does not address the information practices of other websites. The privacy policies of websites operated third parties are located on those sites.

 

For a copy of the AGP Franklin Privacy Policy, please click here.

bottom of page