MidSouth Week in Review
November 4, 2022

Weekly Update from Fund Manager Buzz Heidtke, MidSouth Investment Fund

Nov. 8, 2022 | RedChip Companies


For the week the S&P declined 3.5% on the announcement that the Fed is planning on more rate hikes in addition to the fourth of 0.75%, which was announced Wednesday.  Job vacancies jumped to 10.7 million vs. 10.3 in August.  Just about all commodity prices soared today, with copper being the biggest gainer (+8%).  The FANG stocks are getting killed.  Meta (Facebook) -75%, Amazon -53%, Netflix -67%, Alphabet (Google) -48%.  The 2-year Treasury bond yields of 4.75% is 58 basis points higher than the 10-year bond, which hasn’t happened in four decades.  Daylight savings time ends tomorrow night so set your clocks back.  Sources:  Wall Street Journal and New York Times

 

BuzzBits

 

The October Dow – was up 14.0%, its best return since 1976.  Over the past 60 years, there have been eleven times when the Dow had double digit returns in October.  Over the next 3 months the returns for the group averaged 5.6%, 10.7% over the 6 month period and 15.9% over the 12 month period – CARSON ….. After the midterm elections since 1962, the S&P climbed an average 14.4% over the 6-month period starting November 1; the average gain over the 12-month period was 15.6% - SoFi

 

Charitable Giving – Every day I walk around downtown Nashville and also give money to the homeless.  About three weeks ago one of them approached me and asked for $1, to which I replied, “Why don’t you give me a dollar” and he said, “Why?” to which  I replied, “Because you have made more money than me this year”. – Buzz

 

The Average Investor - only makes around 3% to 4% annually vs. the 11% average annual return over the past 50 years.  Why?  They buy at the top and sell at the bottom.  In the 15 years between 2006 and 2021, investors who were out of the market on the 10 best days would have seen their returns cut in half – MarketBeast

 

Jerry Lee Lewis – died last Friday at age 87.  He was the last surviving member of the Rock and Roll Hall of Fame inaugural class of 1986.  His career was stalled in the 1960s on the discovery that he had married his 13-year-old cousin when he was in his 20’s – USA TODAY

 

The Series I Bonds – reset their yield rate to 6.82%, down from the record 9.62% - Jay Kumar

 

Flu Shots – “And while the flu increases your risk for a heart attack, our research has shown that getting a flu shot is associated with significantly reduced heart attack risks, as much as 45%” – Dr. Deepak Bhatt, editor of Harvard Heart Letter

 

Home Costs – Today a $3,223 monthly mortgage buys you a $586,000 home vs. 10 months ago when the same payment bought you a $1 million home. Amidst fighting inflation in the 80s, the average rate in 1981 was 18.45%.  At that time, median property cost $70,398 vs. $454,900 today – Jay Kumar

 

The Bond Market Crash – The returns this year, have been the worst of any 12-month period in the past 219 years – Edward McQuarie, Santa Clara University

 

No Taxes Due – on long-term gains and qualified dividends if taxable income does not exceed $41,675, $55,800 for head of household filers or $83,350 on joint returns – The Kiplinger Tax Letter

 

New Car Prices – are still 33% higher than pre-pandemic prices.  In October the average new car price was $45.6k, down from $46.1k in July – The Hustle

 

Charitable Donations – made directly from a traditional IRA can save taxes.  People 70 ½ and older can transfer up to $100,000 yearly from IRAs directly to charity – The Kiplinger Tax Letter

 

Increased Costs Since 1970 - Bananas 64 cents vs. 16 cents · Levi jeans $65 vs. $7 · Box seats at Yankee Stadium $265 vs. $4 · Dozen eggs $3.16 vs. $0.61 · Medicare Part B $170 vs. $5.30 · Ford Mustang $27,470 vs. $2,822 · Median home price $440,300 vs. $24,400 · College fees $29,033 vs. $1,674 – Social Security Benefits

 

Home Price Declines – The biggest decline since May of the 50 largest cities was San Jose, CA with a 10.6% decline and five of the eight largest decliners were in California.  The biggest gainer was Miami with a 4.7% increase – Zillow Home Value Index

 

Apartment Demand – in the 3Q was the lowest since 2009.  18% of adults surveyed by UBS, said they had lived rent free with other people during the past six months vs. 11% a year ago – Wall Street Journal

 

Savings – Personal income rose 0.4% between August and September.  Personal savings plunged 8.5% during the same period and is down 28.5% from the February level – Opportunistic Trader

 

Home Buyers – who purchased homes in the year ended in June, moved a median of 50 miles from their previous residences, the highest on record vs. 15 miles in 2005.  The reason for the big change is that many employers are letting their workers work from home – Wall Street Journal

 

Great Young Dancers - https://www.instagram.com/reel/CiMeUg2K5gi/?igshid=MDJmNzVkMjY=

 

 

The material was prepared by MidSouth Investment Management LLC, and does not necessarily represent the views of the presenting party, nor their affiliates.  This information has been derived from sources believed to be accurate.  Please note – investing involves risk, and past performance is no guarantee of future results.  The publisher is not engaged in rendering legal, accounting or other professional services.  If assistance is needed, the reader is advised to engage the services of a competent professional.  This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty.  This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such.  This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested.  All economic and performance data is historical and not indicative of future results.  Market indices discussed are unmanaged.  Investors cannot invest in unmanaged indices. 




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