Last week, bond-rating agency Fitch Ratings downgraded the rating of the United States to AA+. One has to wonder about the timing of the downgrade. Why now? Where was the downgrade of banks before Silicon Valley failed? The problem with rating agencies is and always has been that they view the world through the rear-view mirror.
It has been a strange year in the market. The headlines all seem good with the most-followed broad stock market indices all headed up, but as I always say, it is what is happening underneath the surface that tells the real story. Spoiler alert: Those headline numbers have been skewed by a very small handful of stocks…
If one listens to the financial media pundits, then she would probably believe that there is always some legitimate reason for market behavior and that the market is always logical and correct. Unfortunately, that is nonsense. It is always frustrating when the market disconnects from reality, but this is precisely when opportunities are created.
The real world remains a much better place than Wall Street wants to admit. This isn’t helping stocks at the moment, but it is what matters long term. It might help Mr. Powell if he read Proverbs 17:28 before having another press conference: “Even fools are thought wise if they keep silent, and discerning if they hold their tongues.”
Our view that investors are better off in a traditional retirement plan than in a Roth was in the minority. Secure Act 2.0 should put an end to any doubt. However, the Roth is not without some benefits. Let’s take a look at the details and the drivers.
