The market was off again today as the Dow dipped another 204 points and closed at 21,844. Gold was the benefactor, as it gained almost 13 points.
Much of the news is naturally about North Korea, and it appears that investors are taking this opportunity to merely evaluate their portfolios and readjust their risk exposure in the market as opposed to fully selling-off. An article in USA Today provided some perspective on how the markets react to actual war, let alone the talk of war, illustrating how during war the market tends to recover relatively quickly. For example, after both the attacks on Pearl Harbor and during September 11th, the markets recovered within a month after their initial decline. And then the market experienced no decline during the ensuing responses of the dropping of atomic bombs on Tokyo and the invasion of Iraq. As one CNBC pundit said, if the markets really thought nuclear war was imminent, “the Dow would be down like everything, instead of 0.6%”.
Economic data reported that inflation is still on pace for about 2% this year, which suggests that the Fed shouldn’t be increasing interest rates any time soon. July jobs reports showed that initial unemployment claims grew by 3,000, but continuing claims, or people leaving unemployment, declined by 16,000. It would also seem that the job numbers will continue to improve through August partially as a result of the hiring surge of Amazon Jobs Day.
Today is Day 1 of “Wild Bill” at the Philmont Scout Ranch in New Mexico. As expected, our fearless Scout Leader is fully prepared. Last week there was a trip to the local nutritional store for protein supplements after he reviewed Philmont’s menu and discovered that he’ll be eating instant oatmeal for a week. As a result, it’s expected that these supplements will increase Bill’s stamina during hikes, and his ability to win any scout home run derbies.