1.

I’m approaching 60, and this by far, is the most ominous environment I have experienced. Something is brewing underneath the surface. In my opinion, I think the western worlds are losing control of their currencies due to reckless debts and entitlements. I hope I’m wrong. It seems as if the fabric of our existence has turned shaky. This applies to all our institutions. Is it all a coincidence? Why else would we need to keep poking the bear?

2.

Imagine my amazement when I saw Benjamin Graham’s The Intelligent Investor for sale at the airport bookstore? Maybe value investing is catching on again after all???

3.

For the record, The Federal Reserve rate increases do not translate into higher annuity rates. The Fed deals with overnight rates, annuities have 3-7 year investment durations. Moreover, we could be seeing the end to annuity rates going up. With rates above 3% and some approaching 4%, I would start moving risk into guarantees.

4.

I read that the “Law of Diminishing Returns” says The Fed will have stop their tightening early. Some say as early as September. 3.75% is their anticipated goal for overnight rates, but the law says otherwise. With a 2.50% overnight rate, we could see things start to break. I predict 2.75% will break the repo markets and high-yield market will terrorize the world.

5.

This might be the time to move away from volatility and to start thinking guarantees and safe insurers. Michigan consumer sentiment just hit an all-time low. Maybe that’s bullish for the short-term. I think it might be. But the “shit winds are blowing” due to leverage and high valuations in all asset classes. So if not now, then later. Risk doesn’t just disappear…