Uncategorized June 16, 2021

Market Update June 16, 2021


Last week it was Deutsche Bank. This week it’s Jamie Dimon, CEO of JPMorgan. His belief is that the inflation trend that we’re currently experiencing is less than transitory and is there for hoarding cash.

His strategy is to wait for the Fed who will have to inevitably raise interest rates to combat the rising inflation. This move will cause prices for securities, treasuries and property to drop.

Jamie Dimon is so sure of this happening, he is willing to sit on a balance sheet of $500 billion in cash for this buying opportunity.

While history shows that timing the market is a fool’s errand. So what can the small investor do instead of just sitting on their cash idly?

Buying shares of an Inflation Protected Treasuries ETF, such as TIPS is a pretty safe bet. There also gold ETFs available, such as BAR, that have gold bullion as their sole holding. You can also invest in the things that drive inflation, such as energy prices. XLE is one such ETF. Having considerably outperformed the S&P500, year-to-date, it’s not hard to see why inflation is being pushed higher by commodities. This is of course in addition to the fact that 25% of ALL US dollars were created in ’20-’21.

I’ll just let that fact speak for itself… Have a great day!