Running Off Script

Actionable market insights for investors

Warm welcome to 25 new subscribers this week!

For everyone new, we share actionable market insights and portfolio updates so YOU can make better investment decisions and get an inside view at Tuttle Ventures.

I’ll be back on TV this week.

Tune in Monday, June 27th at 9:45am ET where I’ll be talking all about Nike ($NKE) earnings with Oliver Renick on TD Ameritrade Network!

Paying subscribers will get our key takeaways before the broadcast and a link to a recording of the show.

Here’s the Rundown:

• Market Weekly Roundup

• More Questions than Answers

• Portfolio Updates

• Final Word

Market Weekly Roundup

• The S&P 500 was up +3.5% this week. Health Care was the best performing sector +6.5% , while Energy was the worst-performing sector -8.4%.

• We are seeing the first echoes of household belt tightening affecting corporate

  earnings. Retail sales fell by 0.3% in May, the first month-over-month decline since December.

• Corn, Wheat, and Soybeans are all down over 20% from their highs.

• While nominal wage growth has remained positive +5%, it has not managed to

  offset higher prices, as necessities like food +10%, shelter +6%, and gas +49%

  have registered some of their largest year-over-year increases in decades.

• No new trades in the Fundamental Value Portfolio.

I especially found the sharp drawdown in Agriculture to be noteworthy:

Liz Ann Sonders @LizAnnSonders

Bloomberg Agriculture Spot Index is having its worst month (-12.3% MTD) since September 2011; before that, last time we saw monthly declines of this magnitude was during GFC

As an advisor to other advisors, the question I got the most this week was:

“Darin, what signs are you watching to indicate inflation is cooling off?”

Credit @PhilosophyPath

The short answer is I don’t know.

More Questions than Answers

We thrive in non-consensus and contrarian views.

When the market eventually accepts our early takes as the predominate narrative, we take profits from being early.

We are able to buy when it is uncomfortable at a discount while the market underappreciates financials.

Our edge is mostly derived from going against the consensus, with our highest probability weighted forecasts positioned to profit when the market finally accepts our view.

Now that Inflation is the Topic-du-Jour, anything is possible

The inflation story is running off script, in the hands of the narrative machine who will use the current situation to their advantage to progress their own agenda.

Wolf Richter of Wolf Street wrote a scathing piece called “Inflation Forecasts Aren’t Worth the Paper They’re Written on” and we tend to agree.

We believe inflation will be completely detached from fundamentals or forecasts now that the conversation is in the spotlight.

We have more questions than answers.

• Will inflation be a key storyline heading into midterm elections? If so, how could the current administration react over the next few months?

• Will US corporations respond to inflation to keep pace with wage growth?

• Is the latest bull market in oil already over?

• Will Europe head into a recession before the US?

• Why hasn’t the demand for gold increased?

These questions are now our focus for investigation and provide a framework for collecting data over the next coming weeks.

We think it is also important to leave these questions unanswered and allow us to further explore possibilities and encourage critical thinking as investors.

Portfolio Updates

Current Portfolio Holdings as of 6/26/2022: