Wednesday Reading List

Here’s the inflation breakdown for January 2024 — in one chart by CNBC

The stock market reacted poorly to yesterday’s inflation report. The details: CPI rose .3% in January and 3.1% on a 12 month basis. Economists had expected .2% and 2.9%, and core CPI (ex volatile food and energy prices) was also up more than forecasted. Shelter was the biggest culprit. It’s expected that shelter will cool off and inflation will continue to move in the right direction, and it’s positive that workers’ hourly pay is growing faster than inflation since May.

Cash-Flush Buyers Dip Into Distressed Commercial Real Estate by The Wall Street Journal

Distressed investors are finally getting into the commercial real estate market after delays brought on by sellers unwilling to mark-down prices enough helped by lenders offering loan extensions and modifications. However, that’s changing and lenders are getting tougher due to high interest rates. This activity will be painful for some, but also provide stability to the commercial real estate market.

The Holy Sale of Investing by Of Dollars and Data

Nick got an early copy of Tony Robbins latest investing book and let’s just say he wasn’t impressed. If you’re considering following Robbins investment advice, it’s a must read as the book is basically a sales pitch for a very high cost fund according to Nick.

Recession worries recede 🌊 by TKer

Some recession calls are being reversed, but concerns still exist around debt levels and delinquencies. The numbers there are worse, but that’s coming off great numbers during the economy’s hottest periods of expansion. Cooling off is expected, and so far inflation is easing without forcing the economy into recession.

Indices Acting Active: Index Decisions May Be More Active than You Think by Dimensional Fund Advisors

I’ve written about this before around the time Tesla was added to the S&P 500 index after a huge run in its performance. Your passive index fund isn’t really a passive investment at all as index providers are actively managing what fits into their indices and how to rebalance. You need to understand these decisions and how they could impact your portfolio.

ICYMI: Tracking My Spending – Periodically tracking your spending is important for many reasons, but some of the best tools are no longer available. Here’s how I did it instead and what I learned.

Wintery Mix Hits Markets in January by Heritage Financial

Markets were mixed in January, with U.S. large cap equities leading the way while non-U.S. equities and fixed income produced lackluster returns. Market sentiment shifted and optimism on the potential for a soft-landing grew. Expectations for a Federal Reserve rate cut early in 2024 shifted significantly over the course of the month. Economic data has delivered above expectations of late, but potential headwinds remain and preparing for rather than predicting a downturn, we believe, is the prudent approach.