The Prudent Retiree - What's Going On Part XVI

The market has powerfully rallied since it’s very brief bear market low on March 23rd. The magnitude, duration and volatility of the market since the high of February 19th is probably unprecedented. The market fell more than 30% from it’s peak and it’s rocket ship recovery has left it down less than 6% this year. Talk about blast off.  

The late David Bowie is a rock and roll legend known as a chameleon for his many different personas. One was Ziggy Stardust, a sort of space creature. “Space Oddity” was the story of the astronaut, Major Tom. Like the market of late, he hurtled upward into space. More than 100,000 miles.  

Many believe this market has ascended too far, too fast. There is a strong sense underlying economic conditions don’t support this market rise. We still face many health issues caused by COVID-19. More than 100,000 deaths. Grinding the US economy to a halt has shuttered many businesses and brought on crushing unemployment. Sadly for Major Tom, a circuit died and he met an untimely fate. Will that happen to the market?  

We don’t know. Business is reopening. The Fed is committed to all out support. Congress will most likely soon pass another stimulus bill. All this is a boost for the market.  

We do not predict. We listen to what the market tells us and invest accordingly. Right now, the market is telling us it is going higher. That may change and so will we. Maintain current allocations, but monitor risk and be prepared for a change in direction. The overall bias is up, but expect some pullback. That is normal market behavior.  

“Can you hear me, Major Tom?”  

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Horseman Group – 3 CityPlace Drive - Suite 290 – St. Louis, MO 63141 – 314.692.7842 – www.horsemangroup.com  

Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of  future results.

Investing involves risk including loss of principal. No strategy assures success or protects against loss.