I keep hearing about this Easy Street yet can’t see to find it. People familiar with Easy Street tell me it is easy to find and on Easy Street money is made hand over fist with ease. For example, when Coronavirus broke out and the world prepared for the worse, stocks sold off which lead to my friends who frequent Easy Street to tell me, buy the dips Ross, it is just that easy. Well, they were right again and have been right for the past 11 years. With the equity markets at record highs, those that frequent Easy Street say the good times will continue to roll, I am a bit more skeptical, but why?

According to Lipper: For the week ended 02/05/2020 ExETFs - All Equity funds report net outflows totaling ($2.916) billion, with Domestic Equity funds reporting net outflows of ($3.823) billion and Non-Domestic Equity funds reporting net inflows of $0.908 billion...ExETFs - Emerging Markets Equity funds report net inflows of $0.834 billion...Net inflows are reported for All Taxable Bond funds of $6.963 billion, bringing the rate of inflows for the $3.260 trillion sector to $7.969 billion/week...International & Global Debt funds posted net outflows of ($0.523) billion...Net inflows of $4.904 billion were reported for Corp-Investment Grade funds while High Yield funds reported net outflows of ($0.784) billion...Money Market funds reported net outflows of ($8.081) billion...ExETFs - Municipal Bond funds report net inflows of $1.493 billion.       

Given the amount of money flowing out of equities, $33B in the past 5 weeks, I have no explanation why equity markets are at all-time highs other than me thinking irrational exuberance is also at an all-time high. Treasuries, specifically the 10 year, are trading near all-time lows. What will the Fed do in 2020? “There are a lot of possible scenarios. Base case, the Fed goes on hold. The next most likely scenario is slower global growth leads to an insurance cut. The third scenario is that something unexpected happens and the Fed cuts rates several times,” said Robert Tipp, chief fixed-income strategist for PGIM Fixed Income, in an interview. If the Fed cuts rates, I think that would be well received by equity markets even though the rate cut was done in order to preserve the stock market rallying in an election cycle, economic growth. The bolded text was meant as a joke and intentional.

Where do we go from here? No idea but I am looking for small companies that haven’t participated much in the rally, one of which is Foresight Autonomous Holdings (Nasdaq: FRSX). You can learn more about them here: https://www.sylvacap.com/foresight

Silver Sports Desk:

At the moment the Silver children are skiing and snowboarding. My oldest son is playing indoor flag football and is flourishing at the quarterback position. He has excellent mobility, is a very fluid mover and pinpoint accuracy and touch on his passes. It is amazing how much he has progressed over the past year in football, I am very proud of him.

Baseball season is around the corner so updates to follow once we get rolling there and I will be coaching my two older boys and their team.