In horse racing handicapping, the most astute observers of form, pace, and condition will often take an unusually poor performance by an otherwise dependable steed and "put a line through it," withdrawing a bad race from the overall past performance presentation.
That approach would probably fit well within the scope of long-term investors as it pertains to the pandemic or "covid" era from February, 2020 and - depending on the particular asset - anywhere from June, 2020 to March, 2021. Taking a "before and after" snapshot of the period in between given dates, eliminates the aberrant period in which asset values were whipsawed lower and then back higher, producing a continuity in pricing that is at once more realistic and more reliable for assessing true valuations.
While it may be futile to point this out to the horde of momentum-chasing droids that populate the current investor class since few bother to look back five years, much less five weeks, when performing due diligence, if they bother with that at all. Nonetheless, smoothing out bumps and grinds along the pathways of stocks, bonds, commodities and their varied derivatives is part of the rigor of value investing. It's why moving averages are important.
For those not desirous of a deep look at the past, it's useful to note that most five year charts now, at long last, do not cover the pandemic era at all. By December, 2020, most of the financial horrors had already been relegated to a fresh dustbin of history, though effects on the human psyche and physical health persisted longer, some even to this day. One cannot easily draw a line through personal tragedy or long term illness and death has its own black line, drawn with a permanent marker.
The passage of time and the wisdom of charts has done some of the work for investors by taking out some of the bad experience, but, five years of past performances may be suitable for a seven-year-old racehorse, it's a little short on the history of companies, especially those like Dow stocks that have been around for decades. Well, some of them, at least.
Those bearing recency bias may want to perform a similar line-out on the tariff tantrum from April through July of 2025. It was also an aberration that should not be included in 52-week high or low measurements. All assets, classes, and stocks are different, so employing sound judgement on such matters is a requirement.
Looking at more recent developments, the FOMC did what everybody expected and cut the federal funds target rate 0.25%, to 3.50-3.75%, the lowest in three years. The Fed also restarted QE, announcing that they would begin buying $40 billion worth of short-dated treasury bills immediately at Chairman Powell's press conference following the policy statement. Claiming that the purchase of short-term bills is "not QE", this latest liquidity push is not explicit in the official statements, but rather referenced in the implementation note, directing the Open Market Desk at the Federal Reserve Bank of New York to:
Increase the System Open Market Account holdings of securities through purchases of Treasury bills and, if needed, other Treasury securities with remaining maturities of 3 years or less to maintain an ample level of reserves.Roll over at auction all principal payments from the Federal Reserve's holdings of Treasury securities. Reinvest all principal payments from the Federal Reserve's holdings of agency securities into Treasury bills.
Thus, there are no reins on the NY Fed. They are free to purchase T-bills and roll over expiring bills, notes, and bonds into exclusively bills.
This indicates, as none other than "Big Short" Michael Burry opines that such a move shows that the banking sector is stressed, not "stable" as many pundits would like to reference its current condition. (Editor's Note: Oddly enough, after clicking the link to the story above, Money Daily was prompted to log into its msn account, with the message, "since you are accessing sensitive information..." How about that? Now, financial information concerning Michael Burry is now sensitive?)
The next FOMC meetings are scheduled for January 27-28 and March 17-18. The Fed made no reference toward cutting rates any further.
All of this just helped silver bump a lttle higher. With the U.S. stock markets open in half an hour, silver continues to make new all-time highs, Silver hit a high of $62.93 overnight and is holding above $62 currently. Gold is steady at $4,219, and looking to advance.
Stock futures are lower, with Dow futures right at breakeven, NASDAQ futures off 147 points and S&P futures down 25.
Oracle (ORCL) reported before the open. The stock is tanking in the pre-market, down more than 13%. Not to worry, the U.S. government owns 10% of the company. Yeah, how's that working out?
Trouble's brewing. Hurry, Santa! We've all been nice this year!
At the Close, Wednesday, December 10, 2025:
Dow: 48,057.75, +497.46 (+1.05%)
NASDAQ: 23,654.16, +77.67 (+0.33%)
S&P 500: 6,886.68, +46.17 (+0.67%)
NYSE Composite: 21,933.31, +278.52 (+1.29%)
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