Commentary by Allen B. Lang, Senior Portfolio Manager
LET’S TALK INTEREST RATES and or Congress
The Fed lowered rates 1/4% on July 31st. Why? Good question. Fed Chairman Powell said it was to keep rates easy so the economy would continue to prosper. WHAT!!!!!
As I have repeatedly said, the lowering of interest rates, WHEN THEY ARE ALREADY LOW, gives us a bad sign. I believe the Fed is telling us that things on the horizon really don’t look that good.
I’m not certain. I like low interest rates, IF, corporations borrow for expansion, mergers and/or acquisitions to enhance their product lines, create more jobs. But, if things are running smoothly, why lower rates???
There is too much political infighting and not enough bills coming out of Congress for infrastructure, which I believe is one of the most important items on the agenda. ALSO, Health Care, which is running rampant with drug costs and care.
It seems that our Congress men and women are too concerned trying to “knock off” each other, and not paying any attention to their constituents. I really can’t wait to hear excuses next year why each couldn’t get things done. Term limits IS the answer. It will force legislators to get in and work from day one to get things done for their communities and their state.
As for the markets, August and the first half of September is typically the vacation time for Wall Street. Don’t look for anything major to happen unless there is major events worldwide that causes either panic or euphoria. In any event pick and choose investments wisely, especially within your risk tolerances. Income-oriented securities would probably not be a bad idea.
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