Better late than never, right? I’ve spent the better part of four days on the lacrosse field and those of you with children can attest to the long days of games and travel. I have heard this many times, but I know I will miss these days once they have passed, and it will be here before I know it. I will cherish this time with my boys while they last.
The financial markets appeared to calm a bit more this week, as Federal Reserve Chairman Powell spent two days appearing before both the House and Senate. He articulated the need to remain aggressive on the Federal Reserve’s stance of being proactive (although I think we can consider them a bit reactive now) in bringing down the inflationary fears that have been stoking market volatility. Of course, as is usual with these types of discussions, a large amount of time was spent finger pointing in both directions across the aisle. The showboating by those in the positions of power never ceases to amaze me. The intended goals by raising interest rates at the pace with which the Federal Reserve is moving is twofold. Bringing down costs while not completely stopping the growth in our country is challenging. The hope is to create a “soft landing” and not tip is into a recession. However, those recessionary concerns remain in the 50/50 range from what we have been reading and watching. Our financial markets seem to have welcomed these headlines as we saw less turmoil this past week than we have in the last month and closed out Friday’s session on a strong note.
President Biden called on Congress to suspend the federal gas tax for 90 days in a recent speech. Currently, the Federal tax sits at 18 cents for regular gasoline and 24 cents for diesel. He also called on States to temporarily suspend their taxes as well. Recall that many states, including Maryland, did this for a brief period and the suspension was well received. A move like this on a much broader scale would indeed provide some relief, especially for those dependent on gasoline in their work and daily lives. Not to mention the impact this would have on holiday travel. While the numbers themselves might not seem that drastic, this would directly help our collective wallets in some manner. While this might be a temporary fix, it could help “buy” some time to let the broader energy markets settle. Perhaps we could even see the end of a war over that time? Wouldn’t that be something.
The week ahead:
We get several pieces of housing data this week, in addition to consumer sentiment (confidence), a NATO summit, Federal Reserve members speaking, real GDP data, and several manufacturing reports. Enough bullet points that will drive many headlines for certain. We are also closing out the second quarter and have reached the mid-point of 2022. A lot to consume, analyze and digest. This year is moving forward quickly and I for one am hoping for a much improved second half.
Have a good week!