The Federal Open Market Committee meets this week, so we first take a quick look at the latest inflation data and guess whether the members vote for an interest rate cut anytime soon. But more interesting will be a discussion that asks if the price of gold now follows tech stocks. I think the data will surprise you.

2024 is a presidential election year, which means some very familiar economic topics are forefront in the news. Three big topics usually debated are inflation, rising Federal debt and the insolvency of Social Security. The Social Security Administration has estimated that the Social Security Trust Fund will be depleted in 2033. Does this mean Social Security will be bankrupt or in default?

We’ll take a look at that and what rising U.S. Treasury yields may be telling us in that regard. Finally, I’ll share some advice on how to plan for the next stock market correction. We may be headed toward one in the near future, so it’s best to plan for it now.

Today’s newsletter is intended to provide a basic understanding of cryptocurrencies; my explanations and examples are by no means exhaustive as this is a complex subject. In the interest of full disclosure, I am what is known as a crypto skeptic, meaning I do not believe that there is long term viability for cryptocurrencies.

The Federal Reserve has two mandates: achieving maximum employment and keeping prices stable. It does this by controlling the money supply and raising or lowering interest rates. The Fed’s fight against inflation has been a common topic in financial news for several months, but not as much coverage has been given to the job market. The economy as a whole has remained robust in this high inflation environment, which has kept unemployment comparatively low.

I thought it might be interesting to look at a little-known recession indicator the Fed uses that is entirely based on unemployment numbers. It’s called the Sahm Rule and we’ll take a look today at whether it is signaling recession.

But before we start on that discussion, let’s take a quick look at the Personal Consumption Expenditures index as reported last week and if it has caused Jerome Powell to change his narrative regarding upcoming interest rate cuts by the Fed.

I hope you aren’t getting nervous by all the chatter about the “Market” at an all-time high. When I started in this business after retiring from the U.S. Army way back in July 1994, the market indexes were a bit lower. The Dow Jones was at 3,764.50, the S&P 500 was at 458.26, and the Nasdaq Composite was at 722.16.

I have learned that the solution to all-time highs was more all-time highs. There have been a few bear markets along the way, but here we are today. I also learned that what the market was doing on any given day didn’t matter unless I needed my money at the time for income or some major expense.