What a Market

The most concerning area of the market is whats going on in credit.

In 40 years I've never seen this type of action. That includes 1987, 2000, and 2008. You can cut the fear with a knife.

This is where an investment advisor comes in to play. He/She should be adding money to the market in here, not panicking out like December of 2018. We've bought the Dow Jones ETF (DIA) to accomplish 2 things. 1) exposure to the market, and 2) yield is indicated at 3.67%.

The most concerning area of the market is whats going on in credit. The 10yr yield has imploded to 92.5 basis points, and the High Yield market is seized up (we never owned either High Yield or Emerging Market Debt). By seized up I mean that spreads which I think were as tight as the high 300s have now blown out to over 700, and no issuers are able to bring financings to market.

The Feds move was forced by the action of the bond market, and will basically reset floating rate debt lower, but the risk is unchanged.

Howard Marks from Oaktree described the market in his latest memo as going from very overvalued to overvalued, fairly valued or inexpensive. Not sure what that all means, but I think selectively you should put money to work at these new lower levels.

Again consult with a financial planner near you to discuss your feelings about your money. I've found in times like this our clients think through clearly, but that comes from our help in designing a portfolio that they understand.

Any questions please call me at 561-847-3596

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