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Weekly Market Pulse: Trading Places

Joseph Calhoun profile picture
Joseph Calhoun


  • Stocks are expensive, and people aren’t buying because they want to but rather because they feel like they have to. When people say they are panicking into “the market”, what they really mean is they are panicking out of bank deposits or other safe assets.
  • This panicky behavior probably explains some of the recent demand for bonds as well. There has been a general sense of disbelief about bond yields in recent months, as the 10-year yield dropped from 1.75% to the current 1.24%.
  • The economic slowdown is obvious in the recent economic releases, but most of them are still positive.

Cartons of financial investment products in a shopping cart.
William_Potter/iStock via Getty Images

They’re out there panicking right now. I can feel it. They’re out there. They’re panicking. Look at them.

- Eddie Murphy as Billy Ray Valentine in Trading Places

I thought of that scene the

This article was written by

Joseph Calhoun profile picture
Joe has worked in the financial services industry since 1992 in various capacities, including Operations Manager, Compliance Manager, Registered Representative and Portfolio Manager. From 1997 to 2006, when he founded Alhambra Investment Management, Mr. Calhoun was a Director of Investments at Oppenheimer & Co. Mr. Calhoun holds the Series 63 (Uniform Securities Agent State Law) and 65 (Uniform Investment Advisor Law) securities licenses. He has previously taken and passed the Series 7 (General Securities Representative) and Series 9/10 (General Securities Sales Supervisor) securities exams. Joe proudly served in the U.S. Navy’s nuclear submarine service for 8 years (1983-1990) and was awarded several commendations including the Navy Achievement Medal in 1987. He studied engineering at the University of South Carolina and is a graduate of the U.S. Navy’s Nuclear Propulsion School. He founded Alhambra Investment Management as a registered investment advisory to address the needs of the individual investor. His market commentaries are widely read and published at various online outlets. He has appeared on Larry Kudlow’s program on CNBC and various radio programs. He is also an editor of the website RealClearMarkets.com.

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Comments (2)

Joe; As always thanks for your great perspective.
153972 profile picture
"Make no mistake, stocks are expensive, and people aren’t buying because they want to but rather because they feel like they have to. But I don’t think they are panicking into “stocks”. When my friend says they are panicking into “the market”, what he really means is they are panicking out of bank deposits or other safe assets."

The FED has done their job. Those that were sunbathing are now jumping into the pool because the lifeguard (FED) will save them from drowning.

"I’m not sure that is exactly the result the Fed wanted, but it is certainly the one they’ve achieved."

I don't know either but when the FED has had four QEs and repos when Treasury interest rates spike due to lack of trusted collateral it doesn't take a CPA graduate from Stanford to figure out that asset price inflation would be the result.
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