What a week last week was. No matter how good a plan you have to protect your assets, there are times the stock market players will catch you and everyone else off guard. The FED has been raising rates since last summer to curb inflation and slow the growth of the job market. Last week the number of jobs increased higher than the FED wanted and now we can expect interest rates to continue to rise.
Higher interest rates have a killing effect on so many things in our world and until we sit back and think about it, we are like, what is the big deal? The cost to carry any balance on a credit card. The cost to finance any type of transportation, a car. The cost to buy a house. That is just for retail buyers like ourselves.
What about businesses? Well yes, it does and I think our first bank in California, Silicon Valley Bank, closed its doors Friday and people could not get their money. Higher borrowing costs and then a run on the bank cause it to become insolvent. We haven’t seen anything like this since 2007-2008 and that was ugly.
So, how do we control this as investors? You can’t! All you can do is analyze the current situation and make your best decision.
Let’s look at our charts.
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