Market Moves- October 2021


  • Concerns about the possibility that we have true inflation and not “transitional” inflation due to Covid threw the stock markets into a tailspin in September.

  • The Fed indicated that it will probably raise interest rates in 2022.

  • Supply chain disruptions continue to hurt the consumer and numerous industries. Shipping containers are hard to find, factories are closing in Asia due to Covid, and there are continued labor shortages. The retail industry could be in big trouble and unable to fill the shelves for the Christmas peak buying season.

  • With the strong possibility that the giant Chinese property developer Evergrande will default on over $300 billion in debt, and a smaller rival, Fantasia missing a bond repayment deadline, China could be in for a large real estate decline which could trigger additional financial chaos.

  • The Covid variant resurgence is creating additional hospitalizations and fear of another economic slowdown, but there has been good news from Merck and Ridgeback regarding a pill therapy that could significantly reduce the risk of death and hospitalizations by 50%.

  • The unemployment rate continues to fall.

  • As of September 30, 2021, The House of Representatives has enough votes to pass the stopgap funding bill that will keep the government running until Dec. 3. The Senate already passed the measure, so the bill then heads to President Biden's desk for his signature. Still to be addressed is the debt ceiling. As of Tuesday, Treasury Secretary Janet Yellen estimated that the Treasury will exhaust its extraordinary measures on about Oct. 18 if Congress doesn't raise or suspend the debt limit.

Actions we have taken:

  • We have sold 100% of our position in Caterpillar and reduced other positions to raise more cash. We are adding to our commodity position.


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