The Weekly Update 7/12/2024

Asymmetrical Times

In the first chart below notice as a country, we now have the largest ever balance in money market funds!  Over $6 trillion! And that does not include over $20 trillion additional in Certificates of Deposit, Timed deposits, Checking Accounts and Cash held bank accounts.

In my 43 years at this desk, I have never seen record cash and record high market valuations for Corporate America as measured by the S&P 500 at the same time.  Ever!  Indeed, the opposite is more normal.

Normal would-be seeing cash values dropping as the money moves to investments.  But when you see hordes of cash outside of the all-time high valuations it tells you one thing!  “Fear” is the word of the year! 

You can see it in this second chart below.

Per this Bull / Bear Sentiment chart dated 7-3-2024 almost 60% of investors are not positive on the investment outlook (Bullish).  By the way, this is the same level as October 2023.

Not only is this something I have never seen, it is also Super positive for investors! 

For long term investors a “Fear” based outlook is a contrarian indicator.  Once we see these fearful folks turn more positive, say post-election (just because it is over) those trillions could start to flow to where it will be treated better than a few percentage points at the bank.

At the WSG, we are well allocated for this and have our well thought out Investment Selection Matrix™, investment menu working in our collective TWSG family’s asset allocations

I’m interested in your thoughts, comments, and observations.  Feel welcome to call, email, or stop by the office and say Hi.

Respectfully,

James O. Lunney, CFP®

CERTIFIED FINANCIAL PLANNER™ Professional  

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All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested in directly. The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. Stock investing includes risks, including fluctuating prices and loss of principal.

Asset allocation does not ensure a profit or protect against a loss.  Value investments can perform differently from the market as a whole.  They can remain undervalued by the market for long periods of time.