True to form, September was not kind to stock markets. The S&P 500 slumped 9.34% for September, final figures show, with the index posting a six-session and three-week losing streak in the month. It was the worst month since the beginning of the COVID correction in March of 2020. And thanks to rate hikes that are increasing at a record pace, financial stuff is starting to break – on the Sunday Reads.
As Kyle had offered on MoneySense, September is historically the worst month for stocks. Late September stuck to the script.
A cluster of storms
Things could get bad …
Or not. Once again, we don’t know the future. But we should always be prepared for the market and the economy to deliver something “entirely different”. That has been a constant theme on this blog. Readers are prepared. At least they’ve been warned. But it is certainly time to stick to the investment plan. Market corrections and recessions are all normal and expected events for the long term investor.
And remember, risk can bring opportunity. Last week I asked (I added more content to this post during the week) …
What stocks and ETFs are you buying? The stock and REIT sale continued this past week.
Rates went from too low to too high, too fast?
Rates were held too low for too long (free money) and that creates a false economy and misalllocation of capital. The global financial system is trying to get real, and for now reality sucks. But again, risk and stress can create opportunity.
Credit Suisse might provide a Great Financial Crisis Lehman moment.
Whatever it takes to fix what’s broken
The Bank of England had to return to “whatever it takes” to avert a pension crisis. MacroAlf’s sources turned out to be correct.
Deutsche Bank is also looking to make the stuff-is-breaking headlines. Stay tuned. But please stay invested if you have the risk tolerance.
More Sunday Reads
On My Own Advisor Mark points to research that suggests that young folks don’t have to save for retirement. We know that the earlier you start the better. But finding the money to invest can be a challenge. You may have other priorities such as reducing debt and saving for a home. If you can’t invest in the early working years, no worrries (perhaps) you can play portfolio catch up in retirement – I did.
And on stocktrades.ca, Dan has a look at the best Canadian banks to buy in the Fall of 2022. I think most would agree with Dan’s top 4. I would add that the banks have certainly moved into good value territory.
Bob at Tawcan offers his August dividend update. Once again, Bob is a prolific saver and he invests on a regular schedule. Those are two amazing attributes. Of course we have to also be aware of the costs of concentrating (exclusively) on the dividend in the accumulation stage and in the retirment stage.
Sell stocks to not sell your self short
Please have a read of …
Living off of the dividends? Why sell yourself short?
Rob at Passive Canadian Income sold out of his “HELOC stocks” – at a profit. That was a good move if Rob was not comfortable with the leverage.
I will highlight two very good posts on Findependence Hub.
Sa’ad Rana from BMO takes a look at the Nasdad 100 that offers exposure to the modern economy. That wonderful growth-oriented index has trounced the S&P 500 in recent decades.
That index is now in freefall thanks to the rising rate environment. The Nasdaq 100 played the lead role in the lost decade for U.S. stocks. That said, things do not appear to be as overvalued today, compared to the dot com crash era of the late 1990’s and heading into the early 2000’s. The Nasdaq 100 is an incredible group of forward-thinking (and largely growth-oriented) companies. You might simply add to an index ETF on a regular schedule. Once again, we don’t know how low prices might go.
More on modern tontines
Jonathan Chevreau also took a deeper look at the modern tontines.
The pension-like products and annuities might become very popular with retirees. In 2021 I took a look at the Purpose Longevity Pension Fund.
Also on the retirement front, we have – Imposter syndrome and retirement from FiPhysician.
We swoop in on the Dividend Hawk to see the stock stories and the blog posts of the week.
There’s an incredible compilation of reads and podcasts on Banker on Wheels. That includes listening in with Stanley Druckenmiller.
From the No. 1 investor in the world
On Banker … “Stanley Druckenmiller, the #1 investor in the world. I know, that’s a big claim! But get this: during his 30 years managing money for investors, he had an average annual return of 31%. And he NEVER had a down year. So if you’re even a little interested in finance, you’re going to learn a lot from Stan – including some really practical investment advice and his take on the future of our economy”
Druckenmiller offers that he has never been more humbled. He can’t see a fat pitch, he can’t figure it out. It’s the biggest asset bubble he has ever seen in his career. And he’s more than nervous.
More, in video form.
Post update. On waiting for the Canadian real estate market to break. Prices held up in August.
The real estate affordability battle in Canada.
Thanks for reading. We’ll see you in the comment section.
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Hmm, panic selling by leveraged dividend investors seems to me to signal a (short term) bottom in the markets in the coming weeks…
Retail investors have not broke (puked up)yet. But they might.