Who the heck is Sahm Rule? 🥸

And how bad is it going to get?

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AUGUST 5, 2024       Alright, I’ll admit it… Until today, I hadn’t ever heard of the “Sahm rule.” But it’s fascinating. The Sahm rule that everyone is so up in arms about is named after former Federal Reserve economist and White House policy advisor Claudia Sahm…   She seems pleasant. So why is everyone blaming her for the market collapse today?  Well, jokes aside, it’s obviously not so simple.  See, Miss Sahm came up with a simple rule for labeling “recessions”: the initial phase of a recession has started when the three-month moving average of the U.S. unemployment rate is at least half a percentage point higher than the 12-month low.  If that rule is true, and it has been accurate historically, then we officially entered a recession on Friday when the weak jobs report dropped.  But, according to CNBC, Miss Sahm herself is not convinced. She said on Friday that: “We are not in a recession now — contrary to the historical signal from the Sahm rule — but the momentum is in that direction. A recession is not inevitable and there is substantial scope to reduce interest rates.” (It should be noted, since CNBC will not note this, that Sahm served under the Obama Administration, and therefore might have political motivations for softening the blow of her own rule in the heat of a fraught election cycle.)  In any case, whether we are or we are not in an official recession, things are pretty ugly in the markets right now:    Very little green on that screen.  So, understandably, a lot of traders are panicking right now. You might be among them. Take a deep breath, because there are a few things to consider: First, Geof Smith reminds us that the SPY is still way up year-to-date.   We have to keep things in perspective. The market is not falling to pieces, this isn’t 1929. It’s a really rough day in a market that has still been overall positive on the year. Also Graham provided some really interesting research he found today specifically regarding the Sahm rule:    He added: “I also have to think that we're getting a pretty over reaction to the jobs report, but there's definitely a lot of uncertainty in the air. I have to imagine we bounce from these levels (even if the trend turns bearish).”  A bounce higher certainly seems nice after a day like today. But here’s the thing, and remember, we talked about this last week… You can’t let one loss or one bad day in the markets overwhelm you. You just need to get back up and start swimming again. Losses can and will happen. It’s how you recover from the losses that determine whether you make it as a trader or not!  Keep your heads up, Stephen Ground Editor-in-Chief, ProsperityPub Editor’s Post Script: Have you seen Geof Smith’s “Oklahoma Trade” in action yet? If you’re worried about traditional trading and mainstream stocks in uncertain markets like these, you need to check out his unique approach to weekly income using under-the-radar assets. It’s really cool and I can’t wait to get into one of these trades myself!

AUGUST 5, 2024 Alright, I’ll admit it…   Until today, I hadn’t ever heard of the “Sahm rule.” But it’s fascinating.   The Sahm rule that everyone is so up in arms about is named after former Federal Reserve economist and White House policy advisor Claudia Sahm…   She seems pleasant. So why is everyone blaming her for the market collapse today?    Well, jokes aside, it’s obviously not so simple.    See, Miss Sahm came up with a simple rule for labeling “recessions”: the initial phase of a recession has started when the three-month moving average of the U.S. unemployment rate is at least half a percentage point higher than the 12-month low.    If that rule is true, and it has been accurate historically, then we officially entered a recession on Friday when the weak jobs report dropped.    But, according to CNBC, Miss Sahm herself is not convinced. She said on Friday that: “We are not in a recession now — contrary to the historical signal from the Sahm rule — but the momentum is in that direction. A recession is not inevitable and there is substantial scope to reduce interest rates.”   (It should be noted, since CNBC will not note this, that Sahm served under the Obama Administration, and therefore might have political motivations for softening the blow of her own rule in the heat of a fraught election cycle.)    In any case, whether we are or we are not in an official recession, things are pretty ugly in the markets right now:    Very little green on that screen.    So, understandably, a lot of traders are panicking right now. You might be among them.   Take a deep breath, because there are a few things to consider:   First, Geof Smith reminds us that the SPY is still way up year-to-date.   We have to keep things in perspective. The market is not falling to pieces, this isn’t 1929.   It’s a really rough day in a market that has still been overall positive on the year.   Also Graham provided some really interesting research he found today specifically regarding the Sahm rule:    He added: “I also have to think that we're getting a pretty over reaction to the jobs report, but there's definitely a lot of uncertainty in the air. I have to imagine we bounce from these levels (even if the trend turns bearish).”    A bounce higher certainly seems nice after a day like today.   But here’s the thing, and remember, we talked about this last week…   You can’t let one loss or one bad day in the markets overwhelm you. You just need to get back up and start swimming again.   Losses can and will happen. It’s how you recover from the losses that determine whether you make it as a trader or not!    Keep your heads up,   Stephen Ground Editor-in-Chief, ProsperityPub   Editor’s Post Script: Have you seen Geof Smith’s “Oklahoma Trade” in action yet? If you’re worried about traditional trading and mainstream stocks in uncertain markets like these, you need to check out his unique approach to weekly income using under-the-radar assets. It’s really cool and I can’t wait to get into one of these trades myself!

ABOUT US:  We believe that the opportunity for financial literacy and freedom belongs to all people, not just those who already have years of investing experience. Prosperity Pub provides an array of educational services and products that will help you navigate the markets and become a better investor. Trading is made simple through our online forum full of trading techniques to give you the best tools to kick-start your investing journey. We offer collaborative webinars and training; we love to teach. No matter the opportunity, we bring together a strong community of like-minded traders to focus on analyzing market news as it’s presented each day. DISCLAIMER: FOR INFORMATION PURPOSES ONLY. The materials presented from Prosperity Pub are for your informational purposes only. Neither Prosperity Pub nor its employees offer investment, legal or tax advice of any kind, and the analysis displayed with various tools does not constitute investment, legal or tax advice and should not be interpreted as such. Using the data and analysis contained in the materials for reasons other than the informational purposes intended is at the user’s own risk. DISCLAIMER: TRADE AT YOUR OWN RISK; TRADING INVOLVES RISK OF LOSS; SEEK PROFESSIONAL ADVICE. Prosperity Pub is not responsible for any losses that may occur from transactions effected based upon information or analysis contained in the presented. To the extent that you make use of the concepts with the presentation material, you are solely responsible for the applicable trading or investment decision. Trading activity, including options transactions, can involve the risk of loss, so use caution when entering any option transaction. You trade at your own risk, and it is recommended you consult with a financial advisor for investment, legal or tax advice relating to options transactions.  Please visit https://prosperitypub.com/terms-conditions/ for our full Terms and Conditions. Unsubscribe This email was sent to phanxuanhoa60.trade1357@blogger.com by Prosperity Pub 101 Marketside Ave, Suite 404 PMB 318, Ponte Vedra, Florida 32081, United States Prosperity Pub

ABOUT US:  We believe that the opportunity for financial literacy and freedom belongs to all people, not just those who already have years of investing experience. Prosperity Pub provides an array of educational services and products that will help you navigate the markets and become a better investor. Trading is made simple through our online forum full of trading techniques to give you the best tools to kick-start your investing journey. We offer collaborative webinars and training; we love to teach. No matter the opportunity, we bring together a strong community of like-minded traders to focus on analyzing market news as it’s presented each day. DISCLAIMER: FOR INFORMATION PURPOSES ONLY. The materials presented from Prosperity Pub are for your informational purposes only. Neither Prosperity Pub nor its employees offer investment, legal or tax advice of any kind, and the analysis displayed with various tools does not constitute investment, legal or tax advice and should not be interpreted as such. Using the data and analysis contained in the materials for reasons other than the informational purposes intended is at the user’s own risk. DISCLAIMER: TRADE AT YOUR OWN RISK; TRADING INVOLVES RISK OF LOSS; SEEK PROFESSIONAL ADVICE. Prosperity Pub is not responsible for any losses that may occur from transactions effected based upon information or analysis contained in the presented. To the extent that you make use of the concepts with the presentation material, you are solely responsible for the applicable trading or investment decision. Trading activity, including options transactions, can involve the risk of loss, so use caution when entering any option transaction. You trade at your own risk, and it is recommended you consult with a financial advisor for investment, legal or tax advice relating to options transactions.  Please visit https://prosperitypub.com/terms-conditions/ for our full Terms and Conditions.   Unsubscribe This email was sent to phanxuanhoa60.trade1357@blogger.com by Prosperity Pub 101 Marketside Ave, Suite 404 PMB 318, Ponte Vedra, Florida 32081, United States Prosperity Pub