500 points here … and 500 points there … and pretty soon you’re talking about a real bear market..
- FOMC meetings usually cover 2 days. This month’s begins today, Tuesday. Tomorrow afternoon (Wednesday) they will issue their “statement” which will be followed by a press conference by Jerome Powell. Often, it’s the press conference that moves markets.
- Roughly quoting Randall Forsyth this week: “Watch what the Fed says, not what it does.” Meaning: They probably won’t raise rates at this meeting, but what they say about future QE or rate hikes will be the real news.
- Just browsing today’s WSJ, the economy has slowed significantly this year - largely attributed to covid.
- The wild market swings are not a positive sign. I wouldn’t be surprised to see a 1,000 - 2,000 point one-day selloff in the Dow some day this week or next. ((I’m not psychic - just looking at patterns and, like everyone else, trying to draw some inferences.)

I would wager: market over-valued; political & geopolitical concerns; lingering supply chain woes w/ Omnicron, rotation out of growth, Bitcoin nervousness. Quant trading alogorithms.
Maybe, just maybe, folks are also worried about having COVID in rear-view mirror (as odd as that sounds). But that's a maybe.

+1 To which I would add typically-jittery index-based retail investors of ETFs and/or OEFs that can amplify market moves in individual stocks both on the up or downside. Especially those who "got into" investing (er, "trading") during the pandemic and probably don't know what they're doing.

I or someone may have posted it earlier, but now the reorganization is complete.
David included some information in the January 2022 commentary.
https://www.mutualfundobserver.com/2022/1/

+1
Actually my previous post pertained more to bear markets than run-of-the mill corrections. I’m not attuned to the finer points, except bears tend to last longer - usually measured in years. That’s why many keep the cash reserve.
If the early morning numbers hold up or get worse, we’d probably be in correction territory in most
markets. Calling it a bear would be premature.
Qtr 1 of 2020 was somewhat unique. Huge 15-25% selloff across many asset classes in 2 or 3 months. WTH that was, I’m not sure.

“A consortium of U.S.-based creditors to Mexican multimedia conglomerate TV Azteca S.A.B. de C.V. has threatened to take action to seize its assets in Mexico and abroad after the company skipped a year’s worth of interest payments and is on the cusp of forgoing another in February … Mexico City-based TV Azteca is the second largest producer of Spanish-language television programming in the world …
“TV Azteca has been in arrears on its debts for almost an entire year, after it skipped a $16.5 million interest payment on a $400 million dollar-denominated bond due in 2024 last February and hasn’t sent creditors any money they are owed since. The company also opted not to pay another $16.5 million interest payment that came due in August, according to two people with knowledge of the matter.
“The company’s largest U.S.-based creditors, including Fidelity Investments Inc., Contrarian Capital Management LLC and Cyrus Capital Partners LP, met with a representative for TV Azteca at Fidelity’s headquarters in Boston on Wednesday to discuss a plan that would repay the bondholders in full plus accrued interest over time, one of the people said. TV Azteca has yet to decide if it will accept the offer.”
(Excerpted from)
“Pro Bankruptcy Distress”
By Alexander Saeedy
The Wall Street Journal
January 24, 2022

“Rising bond yields, particularly on inflation-protected Treasurys, are viewed as close indicators of borrowing costs for businesses and consumers.“
Investors pay close attention to yields on TIPS because they offer an important gauge of financial conditions, indicating whether borrowing costs for businesses and consumers are rising or falling when stripping out the effects of expected inflation.
“Often referred to as real yields, yields on TIPS have been deeply negative since the early days of the Covid-19 pandemic, helping to fuel outsize stock-market gains by pushing investors into riskier assets in search of better returns. Even today they remain below zero, meaning holders are guaranteed to lose money on an inflation-adjusted basis if they hold the bonds to maturity. Yet they have climbed even more this year than yields on ordinary Treasurys—a sign of higher borrowing costs for businesses, better forward-looking returns on bonds, and a return to more normal growth and inflation as the Federal Reserve starts tightening monetary policy …”
Also (Same Article):
“Donald Ellenberger, a senior fixed-income portfolio manager at Federated Hermes, is among those responsible for surging real yields. Starting in the early days of the Covid-19 pandemic, he was a major buyer of TIPS, steadily increasing them from 4% of his multisector bond portfolio in March 2020 to 7% by November of that year. Mr. Ellenberger’s concern at the time was that historic fiscal and monetary stimulus would lead to a surge in inflation—a fear that proved prescient as TIPS rallied and the consumer-price index soared… By the end of last year, though, the Fed had shifted course, promising to accelerate a wind-down of its bond-buying program and start raising interest rates … In response, Mr. Ellenberger and his team slashed their TIPS holdings from 7% to 1%.”
(Excerpts from)
“Tech Rout Fueled by Bond-Market Turn”
By Sam Goldfarb
The Wall Street Journal
January 24, 2022
In a separate article, the same issue of the WSJ noted that municipal bonds are also seeing outsized losses of late.

https://www.sec.gov/Archives/edgar/data/889366/000119312522015835/d266872d497.htm
(See link for table of reorganizations)

Hi @Old_Joe
The below link is for Google Finance and a decent overview. The graphic is linked at 1d (today, Jan. 24, close). You may select/click other time periods to the right. ALSO, other data regarding ASML is at this page, to the right and scrolling down usually provides other news.
This link is active, so one may place whatever symbol/ticker in place of ASML at the top of the page for a search.

ASML Google Finance view

VIX also had a huge reversal but remains high - a VIX of 29.90 still projects daily volatility of +/- 1.6% (high). What was interesting was the muted SKEW (EOD value), i.e. the traders weren't rushing to buy puts. This relatively high VIX and relatively subdued SKEW combo may mean that the SP500 may try to form a base here. Stock futures are now negative this evening.
https://stockcharts.com/h-sc/ui?s=$VIX&p=D&yr=1&mn=0&dy=0&id=p14688267036
https://www.cmegroup.com/

To answer the question posed in the title, historically every 18-24 months.

Still peckin’ away at VTI. Bought at 214 - closed at 222.24. Not too shabby for an afternoon! Sheesh this markets crazy!

@davfor, thanks for sharing your view. I too have made sizable changes throughout 2021 in order to lower the risk from multiple fronts: interest rate hike (inflation) and potential war (Ukraine and other conflicts). Will be patient just like previous severe drawdowns.

Reconstitution changes (purchases) will be made 3/21/2022 this year. However, my notes show the date the index constituents selections are made is done in Feb of each year. I cannot find the exact date in the Index Methodology document. Does anybody know when the index is finalized? If my notes are right..... it would be possible for valuations to change between Feb and March given volatility we are seeing.

Filled limit order on ASML. Have placed another at 625.

+1 Go for it!
I’ll try to change my DKNG order from “day” to “GTC” as it has rebounded substantially from this morning’s $17.50 level. Won’t break my heart if it never gets that low. A little bit of that one goes a long way (200 octane). :)
FWIW. Wood’s ARKK partially refloated itself today. Was down over 9% this morning. It’s actually in the green as I write.

It seemed like a good day to add to a basket of quality companies with SCHD. Also added to UTF on a pullback, currently at a discount with a 7.19% divi.

added to GGSOX on 1/19- Believe it was -12% @ that time.
GP's latest GPGEX - Will add to that when it hits -10% & it's work on that drop.
Sold MAINX a short time ago & then it started a + move !
No serious dips yet, Derf
PS I'll sell either
VMVAX or VSIAX
if they drop to
<25% profit level.
That should stop
the downturn !!

Just picked up a few additional shares of WPM at $39
Order in for DKNG at $17 - about $.50 below current price (own some @ average price around $20.)
IMHO - Too early to take a serious dip, but may be some targeted opportunities if your time horizon is more than a few months.
Indexes as I write: DJI -800 points 32,436 / NASDAQ -500 13,280 S&P -130 4264

Apologies @derf............your thread has drifted a bit.
@davidrmoran
I'm not able to access the NYT article. What is the Kudlow reference to/for SDS?
From a generational (age group) knowledge/view, my first thought when I see the letters, SDS, is: Students for a Democratic Society (radical political organization of the 1960s).
They held their first meeting in 1960 on the University of Michigan campus at Ann Arbor.
--- The Weatherman Group (formed in 1969)
The Weatherman Group was an anti-war and anti-government group within the Students for a Democratic Society that became popular in the 1960s for speaking out against America's role in the Vietnam War. The group was mainly made up of affluent college students.
Free Dictionary terms for SDS
Thanks,
Catch

If you have any business income, Amex offers a business checking account that currently pays 1.1%.

I just checked at M* the valuation of top 10 components of ARKK portfolio. Two companies are rated four stars (Twilio & Zoom), one company is rated five star (Teladoc), and one company is rated two stars (Tesla). All other companies are rated 3 stars. The higher the star rating the more undervalued a company is. Assuming M* valuation work can be relied upon and assuming the market pays attention to M* work, it appears ARKK may currently be in the range of fair value. But given market's mood always swings too far from the median, another 15% drop in ARKK from today's close price would put it at $64.50, which I think is a good entry point.

We might reach $65 this week as many of the three star and 2 star stocks get re-rated to higher stars. Tesla has to move from 2 star to 3-4 star sometime during the current swoon.