Thirty-eight out of the last 44, or 0.864, sounds like an incredible if not impossible hitting streak. The only problem is that, much to my chagrin, there is no baseball being played these days, no daily box scores, no intel on how my Phillies would be doing 25 games into the 2020 season under new skipper Joe Girardi. If I were to guess how things would have gone up to now, I'd have them at 15-10. Hope springs eternal.
Thirty-eight out of the last 44 is the number of times that the S&P 500 Index has closed up or down at least 1% since Feb. 21. The volatility has calmed a bit over the past couple weeks. However, during the first 32 days of this run, there were nine days that the index closed up or down at least 5%, with the last occurrence on April 6, when it was up 7%. During that entire 44-day run, the S&P 500 is down 16% but is well off its low of March 23, when it was down 34% since the Feb. 21 beginning of the volatile run.
It has been a pretty remarkable recovery given that the country is all but shut down economically, which leads me to believe the volatility is not over. Maybe I'm getting ahead of myself, but I am concerned about the longer-term implications of the current open checkbook of government spending, with a national debt that already has ballooned to just under $25 trillion, and how that will affect us in the years ahead. I know it may not be politically correct to mention that notion at this point, but it should be discussed; neither political party seems to care about the issue any longer.
This shutdown was forced on us. Anyone who has lost their job because they are locked out bears no responsibility and should get help, but the notion of giving checks to those individuals or businesses that don't or won't need them should be questioned. There should have been some means testing. I get that it would be too hard to implement quickly, and there's a lot at stake so it had to be done quickly. However, we will all pay later.
On another note, I've received some queries about my version of Benjamin Graham's "Stocks for the Defensive Investor" and why I don't include retailers. Indeed, that is my own personal bias, not Graham's, that came a few years back when a significant number of beaten-down retailers seemingly were meeting the screen criteria. I simply did not trust the data in terms of how backward-looking it can be (always a consideration when using fundamental data), especially in a struggling, compromised sector.
In case you are wondering, though, if I did include retailers there would be just two that would make the cut, namely Shoe Carnival (SCVL) , and Foot Locker (FL) . That likely will change once there's another quarter of fundamental data in the books, however.