Weighing the Week Ahead: Quit Fighting the Last War

There is a normal economic calendar featuring four different housing reports. With little interest in recent economic or earnings news, the punditry has been interested in history. For many it is another opportunity to sell fear. The pundits might not change focus, but investors should have a resolution:

Quit fighting the last war!

Today’s WTWA will touch on a (mostly) overlooked element of the financial crisis. The Final Thought will emphasize what we all should be thinking about.

Last Week Recap

In my last edition of WTWA I noted the preponderance of inflation-related data and suggested that the week ahead might be an inflation watch. The idea was probably OK, but the inflation results were tame. Instead, the punditry found it more interesting to look back ten years on the fall of Lehman and the financial crisis. Whatever the current relevance, that made for good reading and watching, which I might well have guessed would happen. Did it have any effect on trading or investing? More below on that question.

The Story in One Chart

I always start my personal review of the week by looking at a great chart. This week we’ll feature the futures chart from Investing.com. This is an interactive chart (if you go to the site) which provides many features. The static version still shows the overnight moves and provides a tag for each item of news.

The market gained 1.01% on the week, reversing last week. The weekly trading range was about 1.2%, still very low. I summarize actual and implied volatility each week in our Indicator Snapshot section below. Volatility remains well below the long-term average.

Personal Note

I will be taking a week off beginning next Saturday, so there will probably be no WTWA installment for the next two weeks. As I have done recently, I’ll try to do a mini-update if there is something really important.