Reflections on 9/11, stocks stall as we wait for CPI, Kammy takes the win

• Today is a day of remembrance – it has been 23 yrs.

• Stocks stalled ahead of the debate and ahead of today’s CPI.

• Tech and Real Estate Rallied, while the Big Banks got Whacked.

• Bond yields continue to fall – have they bottomed out yet?

• Kamala takes this one and challenges Donny to Round 2.

• Try the Apple Cinnamon Pork Chops.

Today is September 11th…. (9/11) and 23 years ago – the US was attacked by a group of terrorists that stunned the world.  NYC, Washington, DC and Shanksville, PA all suffered at the hands of these terrorists – the country came to a standstill as the depth of this attack became clearer and clearer…...  I had an office on the 55th floor of Tower 2 and only by the grace of God am I here to talk about it….  Below is my story, my recollection of that day – God Bless our armed forces, our veterans, all of the families that lost loved ones and the United States of America.

Ok – so stocks stalled a bit yesterday, The Dow lost 100 pts, the S&P added 20, the Nasdaq surged by 140, the Russell lost 5, the Transports gave up 30 while the equal weighted S&P gained 70. 

Hear are the links to my appearances on Yahoo Finance and Fox Business

Tech and Real Estate continued to push higher while Financials (think the Big Banks – JPM, GS, C, BAC) and Energy took it on the chin. Oil sold off by 4%  - It’s the (lack of) demand China story again along with Hurricane Francine that is hitting the Gulf of Mexico hard….It has now broken last week’s low – taking us one step closer to testing the lows of September ’22 and March – June ’23 – when oil traded as low as $64.50….

ORCL +10% helped to light the tech sector on fire - as cloud bookings surge and CEO Larry Ellison sees $100 billion AI boom powered by nuclear energy…. saying that the ‘current boom will last for years, and not end soon’…. and that help push tech higher…. Real Estate got a nudge as well on the idea that rates are coming down and that should help real estate do better…Remember – Real Estate is the underperformer for the year…..up 1.5% ytd…..so you could imagine that as the big rotation continues that this sector is ripe for investment dollars.

Now the big banks are getting hammered because estimates are apparently too high going into the end of the qtr.….  JPM CEO Jamie Dimon – telling investors that NII (Net Interest Income) is expected to come in less than the street is estimating, because interest rates are coming down…. But guess what?  That is NOT a surprise, of course NII will be softer if rates come down….so why was anyone surprised?  Here’s the skinny -  David Pinto – JPM President told analysts that they are being ‘too optimistic’ in projecting next year’s NII….So he is doing what he is supposed to do – GUIDING them to a more reasonable place….better that he did it now vs. on earnings day….so Yes, the stock took a hit – 5% - but it would have been down much more had he said nothing and then announced on October 11th.

All while – US regulators are making ‘sweeping changes’ to the Bank- Capital Rules proposal that would cut the expected impact to big lenders by 50% and exempt small banks from the bulk of the measure. – but it was the ‘negative’ news that spread across the sector….no surprise there either…. what did you think was going to happen?  Remember – when the tone is negative – it is easy to accentuate the negatives and forget about the positives.

And then the markets are weighing the risks of the Presidential election – considering last night was supposed to be the one and only Presidential debate that we will see before voters take to the voting box, but apparently – Kamala challenged Donny to another debate in October.

Not sure about you, but I did not hear either side clarifying anything…. their tax proposals, tariff projections, spending plans, energy policy, border policy, healthcare policy, national security policy….   In any event – the main street media is fawning over Kamala…. something no one should be surprised at. 

Bonds gained sending yields plunging……… the TLT rose by 0.7% while the TLH gained 0.6%.  The 2 yr. is now yielding 3.56% - down 29% off the April high while the 10 yr. is yielding 3.61% - down 23% off the April high – And this has translated into big gains for the bond market – the TLT rebounded by 15% and is now up 1.83% ytd while the TLH  gained back 14% leaving it up 2.56% ytd –  Now today is the 5th  day of being un-inverted - and still no recession…. oh boy, the anticipation is killing me. 

Gold is closed at $2542 last night and this morning is up $10 at $2552 as it awaits today’s CPI report…. It has managed to remain in the $2500/$2550 trading range for weeks now as it digests the data and positions itself for any reaction after 8:30 this morning.  My sense is that today’s report will not move the needle or change the narrative at all for the FED.  Rates are coming down by 25 bps next week and then I would expect Gold to test $2500 as a result…think – buy the rumor/sell the news event.

The VIX – Fear Index – is up by 2% this morning at 19.46…. which makes some sense considering that US futures are a lower.  

This morning at 5 am - futures are a bit weaker…. Dow futures -190, S&P’s -23, the Nasdaq is down 100 while the Russell is down 15.  Last night’s performance – in my opinion – has sealed the deal for the Democrats – and that is what the market is telling us…. Get ready for higher taxes, open borders, and more censorship IF they sweep Congress.  What we can only hope for now is a split congress – Republicans in the Senate while the Democrats retake the House and that should keep a lid on most of the fringe policies on both sides.  

European markets are mixed to lower…

The S&P closed at 5495 up 25 pts…and it feels like the tone is negative today – so we will continue to thrash around – my sense is that the path of least resistance is lower as we move into the end of the qtr. 

Long term investors need to remain focused and balanced. Building a strong, well diversified portfolio takes time and commitment

Apple/cinnamon pork chops 

Here is an interesting and easy recipe that will change the way you think about Pork Chops....easy to make, pleasing to the eye, and delicious.... It takes no more than 25 mins to prepare and serve and is a very popular pork recipe.

You will need:  4 chops - on or off the bone (your choice - I prefer on the bone), butter, brown sugar, cinnamon, nutmeg, s&p, apples and crushed pecans (maybe like 3 tblspn) ....

In a bowl - add 3 tbls of brown sugar, dash of nutmeg, about 1 tsp of cinnamon. - set aside.

 Peel and slice the apples into thin slices - set aside.

Season chops with s&p.  In a sauté pan - heat some butter and add chops and brown on each side for about 4 mins - depending on thickness....

When the chops are done - remove and place in a warm oven –

Using the same pan - add a dollop of butter and then the apples, pecans and brown sugar mix to the pan - cook until tender.  This creates a delicious "apple sauce” -  

Do not overcook the apples as they will turn to mush.... When done - present the chop on a warmed plate and dress with the apple/brown sugar mixture.... I would accompany with a baked sweet potato sliced open with a dab of butter and a large mixed green salad.  Enjoy with a nice Chianti..