Afternoon podcast 9-16-26

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Welcome to the afternoon Rob Black Show podcast, a guaranteed human podcast, which can also be heard on AM 1220 KDOW weekdays at 5 p.m. and on 860 AM The Answer weeknights at 11 p.m. The views and opinions expressed in the program are not necessarily those of this radio station or its sponsors and should not be construed as legal tax or investment advice. You should always consult the appropriate advisor before making any financial decision, all rights reserved.

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Now, new focus on wealth, new focus on wealth. Get a new focus on personal finance, wealth management, Wall Street and the economy. Now, Rob Black.

Rob Black (0:43)

Forgive the stock market. It's not having a very good month of September so far. The S&P 500 is down 45 basis points a day. It was in the green. It was in the green. It was again in the green. Then the Fed raised interest rates a quarter of a percentage point. The Dow is kind of in the green, going sideways. And then the Fed this morning raised interest rates, and the Dow fell 631 buckaroos, close at 51,461. The Nasdaq basically flat for the day, but it was getting green all day long. And the final hour went into the red, and then rallied right back up to finish basically down three points, just a skidgen. Russell 2000 down four tenths of a percent. Gold down 80 basis points, the 42.97 an ounce. Bitcoin up one fifth of one percent to $76,017 per ounce. Crude oil down three and a half percent to 102 after having a big move in the month of September.

Taking a look at the treasury bonds, which have become a very big story recently. Why put your money in stocks when you could put them in bonds and earn?

In a note, in the case of a ten year, 5.01, so it closed above 5 Ouch. You hurt me. Ten year bond. My cash kind of wants to sit in cash and get rained at 5% on. I get it. 30 year note, sits at 5.35%. I have enough cash now to last me till the day I die. I could put it in and get 5.35%, but the downside is what if inflation goes up to 6% or 7% and I lose, but historically, it's between 2% and 4%, so then I would win with no risk almost or little to no risk. Except for the fact that as we issue more debt in the United States, the cost goes higher and higher, or it should. Some people like Trump will say, well, no, we're a great economy. It should be given to us almost free. I think that's loco in the cocoa, but you get the idea. Take a look at some individual winners and losers today. Apple was up one. Alphabet was down two thirds of one percent, not much. Meta was up three up one half of one percent. Citi called them, hey, they could get a positive surprise in the next 90 days. So they added them to their surprise upside watch list over the next 90 days. Yes, they strangely have one of those.

So the hawkish fed hike erases early market gains. It's expected that once they do one rate hike, they're probably going to do two or three. Otherwise, they would just pass on this one to wait for the data and maybe done 50 basis points. I can argue they probably should have done 50 basis points. I think Jeffrey Gunnlack called it. He was on CNBC as he's on CNBC after every Fed meeting, and he says they should have done what's called stun and done.

Wow, that's a play on the term one and done, referring to the belief that some that Fed may only do one or two hikes instead of embarking on a tightening cycle. Gunnlack is one of those prominent bond investors that a half point hike would have provided the market with a truing up to the Fed fund rates. Gunnlack said that he worries that the inflation problem facing the United States may not be fully respected. He says, I would have done 50 basis points and seen what the data shows me.

He has previously advocated for larger rate hikes than the Fed has to implement it. He said the two-year treasury leads the Fed, a hypothesis that the federal, that the investor said was proven correct today. Gunnlack said he wasn't surprised to see stocks take a leg down late in the afternoon.

He said, I thought the content was pretty thin. Later, adding that Central Bank Chief was opaque. It's like a company that's having trouble that wants to hire consultants. The consultants always want to figure out what people at the company really want to hear, and then they tell them what they really want to hear. That's what we feel like the Fed did today. But there was some strength today. AMD showed their muscles up 1.6 percent, Intel up 4 percent. Reuters reported today that Intel supported a relationship with SK Hynex, which I believe they sold the memory unit to SK Hynex back in 2020