You can now view Hart Hodges’ Keynote Address “Kitsap in Context” by clicking the link below.
Comments from Hart relative to the recent stock market roller coaster ride:
“At the forecast breakfast I commented that I did not think the stock market could stay immune to political uncertainty or dysfunction. It just did not make sense to have the stock market historically calm given all the conflict in Washington.
I also mentioned that I was worried about interest rates. At the time I suggested, that lower yields on 10 year Treasuries would make people worry about an inverted yield curve and possible recession while higher yields would pose problems for stocks.
Looking at the last three days, I don’t think we should even try to make sense of the stock market relative to the underlying data. The jobs report was good, modest wage growth is long overdue, etc. But the market fell sharply. Many people were looking for a reason to sell because they’ve had such a good stretch and were ready to reduce their exposure to risk. Perhaps it was interest rates going up. I don’t really know the trigger. I do think the drops we saw on Friday and Monday were based on fear and uncertainty rather than any particular piece of data or new information. (Of course, emotions and sentiment matter a great deal in the stock market.)
Now we get to see if earnings come in as strong as expected, what happens to interest rates with the next round of bond offerings, etc.”