• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Bruce Kamich
    • Doug Kass
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • TheStreet Smarts
  1. Home
  2. / Markets

Crypto, Election, Inflation and the Fed: There's a Lot for Investors to Decipher

Here's how I'd be playing things right now.
By PETER TCHIR
Nov 14, 2022 | 12:15 PM EST
Stocks quotes in this article: QQQ, SPY, IWM

After last week's strong rally into the close, there are a few competing issues to deal with this week.

The Election

There remains a chance that we won't get a divided government. That would likely send stocks and bonds lower. It isn't the base case, but this remains something to keep an eye on.

The Fed

The Fed is likely to try and sound tough on inflation. In fact, that happened overnight as Federal Reserve Governor Christopher Waller addressed the central bank's hawkishness and commented on stock valuations.

The only thing I have to say on this subject is there are four weeks of data, and everywhere I'm looking, I'm seeing weakness in the consumer products segment (sale after sale after sale). The rent is artificially inflated in CPI (check out Zillow or other "live" measures of rent and we are nowhere close to the 33-year highs the BLS comes up with).

Jobs are now the Fed's strongest reason to stay so hawkish, but we might (finally) see cracks there.

Crypto

There continues to be a shakeout in "altcoins" and tokens. The crypto community has been very "loose" with terms like "exchange," when they really mean custodian. It seems, from what I've read, that once again, go-mingling (or using customer funds) was an issue.

If you insist on holding crypto of any type:

  • Ensure that if you hold it somewhere, they provide transparency and have a strong reputation (I'd lean towards being domiciled in the U.S.)
  • I'd likely use more than one provider for any meaningful position.
  • Unless you intend to trade actively, reduce cash balances to the minimum. There are, without a doubt, safer places to hold cash. There may be some transfer costs to weigh, but I'd be cautious here.

Finally, this wealth destruction, the spending that companies like FTX could do (tech, ads, etc.), are going to hit the economy. Disruptive stocks, great fuel for the economy, no longer have access to cash at what they consider attractive valuations, so there will be some serious headwinds to the economy.

Bottom Line

I like the "everything" rally to continue here as seasonality will give this a boost. My fear, however, is too much weak data spreads to stocks, but we think we can trade both stocks and bonds from the long side here.

I want no exposure to energy right now (for first time in a long time) and would mix long positions across tech (Invesco QQQ Trust (QQQ) ) large-caps (SPDR S&P 500 ETF Trust (SPY) ) and small-caps (iShares Russell 2000 ETF (IWM) ) just to catch some potential outperformance in one over the other, where I don't have a strong opinion.

I believe adding some muni closed-end funds makes sense here too.

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.
TAGS: Economic Data | Economy | ETFs | Federal Reserve | Investing | Markets | Bitcoin | Municipal Bonds | Politics | Small Cap | Stocks | Trading | U.S. Equity | Cryptocurrency

More from Markets

How to Trade China's E-commerce PDD Holdings Now

Bruce Kamich
Mar 20, 2023 1:17 PM EDT

Previously know as Pinduoduo, weak consumer spending has plagued the stock.

The Fed Is Playing With Fire: To Raise or Not to Raise?

Maleeha Bengali
Mar 20, 2023 11:30 AM EDT

Control, or at least the illusion of control, is everything to the central bank now.

Several Predictions About What to Expect in the Second Quarter

Bret Jensen
Mar 20, 2023 11:15 AM EDT

The most likely scenario playing out in Q2? Lower entry points will be available for the prudent and patient.

Where to Trade Now? Consider Berkshire and the Warren Buffett Way

Stephen Guilfoyle
Mar 20, 2023 10:45 AM EDT

It's a place where one can maintain some exposure to the financials while letting Buffett and his team diversify the investment for you.

It Makes Sense to Buy -- Very Selectively

Guy Ortmann
Mar 20, 2023 10:38 AM EDT

Buying gets more aggressive on each subsequent market decline.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 10:28 AM EDT JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    There are exceptions to conventional trading wisdo...
  • 05:43 PM EDT CHRIS VERSACE

    Latest AAP Podcast

    I'm joined by Real Money contributor Peter Tchir a...
  • 08:20 AM EDT PETER TCHIR

    Pre-CPI Thoughts

    I believe the risk to CPI is "asymmetric." It ...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2023 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login