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Higgins Capital Management, Inc.

Stocks Freefall, The Fed ? and Fun Slippers


The Economy:  Today's US stock market plunged on fears of a trade war with China and higher interest rates.  The Dow closed down 3.15%, the S&P 500 closed down 3.29% and the Nasdaq closed down 4.08%.  This is the biggest drop since February.  Right now, you can earn 2.14% on a 1 month Treasury bill. As interest rates move higher, they compete with investors' money.

Food for ThoughtWith the sell-off today, several talking heads noted the absence of any comment from the Federal Reserve Chairman Powell.  With a new head at the Fed and dynamics shifting with U.S. stocks and bonds, I wanted to share Ray's commentary for his Food For thought today because I think it important to consider the "what ifs" vs. the status quo...

"It's said that history doesn't repeat but it does rhyme. So in the pendulum swing of liberal-conservative-liberal-conservative it may pay to entertain the notion that conservative is on the ascendant. If that's the case, it may pay to entertain the notion that Central Bank manipulation of financial markets is on the wane. If Central Bank manipulation is on the wane, is it possible that the days of TBTF banks are over? After all, the sacred cow status TBTF Banks are the creations of bankers feeding at the trough of taxpayer bailouts for decades. If conservatism is ascendant, is it conceivable that the Trump Administration would stop the bailouts and let the markets decide the fate of the TBTF banks? Do you wanna be right or do you wanna make money? That's the age old question."

Mixing Business with Pleasure: As I flip through magazines, I found The Phoebe Slippers in an article in House Beautiful, 50 Ways to Max Your Relax.  The Floral Jacquard caught my eye, but there are a lot of fun choices for $140.00.  They're available at Birdies Slippers.