The Milky Way is vast: it may be one of trillions of galaxies in the universe, but it is about a thousand light years thick and stretching some 120,000 light years from end to end, holding every alien planet that our telescopes have ever spotted. To travel once around, it would take 250 million years. The Sun is based along one of its smaller arms about 26,000 light years from the turbulent core, which is packed with supermassive black holes. It has a thin, flat disk of gas and an unknown number of stars, some of which are believed to be 10 to 13 billion years old, in the middle. Near the edges, however, it appears rather sloppy, quite twisted and warped. In the financial markets these days, there is quite a lot that is warped, twisted and bubbly.

There is a form of writing going back to the 17th century known as a lipogram wherein a single letter, or a number of letters, are omitted from a work. The author’s challenge is to compose a poem, article or book without using the common letter ‘e’, for example — no easy task. In the case of this short market commentary, 889 instances of the vowel ‘e’ can be found. Imagine the difficulty involved in penning, say, a 50,000-word novel without a single use of that letter. These days we do not need to conjure up new challenges. We have plenty as it is just trying to get through a trading day without another loss, passing a gas station without seeing higher prices, coughing and wondering if we have the new COVID variant, turning on the TV without having a central banker tell us about the harsher dose of rate medicine we need to swallow for the next six months – or longer.

The Atlantic Hurricane season is upon us, having arrived late but with lethal force. It typically runs from June to November, but this year the first major hurricane did not arrive until September 20. The focus is currently on the Category 3 storm headed to Tampa Bay but the remnants of Fiona are still being felt in Puerto Rico and eastern Canada. For people already exhausted by the pandemic, weakened by inflation and battered by investment losses, hurricanes seem to symbolize the hazardous conditions we face in 2022. There are still three months left in the year, but we would all like to evacuate now.

Americans have been playing lotteries for centuries. Some of the earliest ones in the American colonies actually helped to fund the Revolutionary War. There is a lot of scratching and quick-picking going on in the financial markets of late, but very few prizes in the form of returns have been realized in 2022. After years of boom, this year is a big bust for almost every investor seeking returns. Given all the gloomy forecasts for global recession starting as soon as this year, it is hard to be positive on any market sector, although income-seeking investors holding higher yielding bonds are still happily clipping coupons.

One of the easiest ways to learn about the laws of motion is to observe Newton’s Cradle at work. The Cradle was named in honor of physicist Sir Isaac Newton, and was designed to demonstrate the principles of conservation of momentum and energy. It seems an apt device for our times. In these current days of our lives, nearly 300 years post-Newton, long-held principles are being tested in executive offices, courtrooms and voting booths.

Stories about reversals make some of the best tales. We love it when the underdog turns everything around and wins: Rocky, David versus Goliath, the 1980 men’s Olympic Hockey team, the clever con man in Trading Places. This September, while we are busy going back to school, adjusting to new work routines, celebrating holidays and enjoying the change of season, our central bank is starting to undertake one of the biggest reversals of all time. The Federal Reserve is beginning to pare down its portfolio of nearly $9 trillion, one that has grown exponentially since 2007, doubling in size since the start of the pandemic.

When asked about our favorite TV commercials, several always spring to mind. There are the ones that make us laugh, like the 1984 Wendy’s campaign when Clara lifts the bun and asks “Where’s The Beef?” or the giddy Geico camel in the 2013 Hump Day commercial. There are others that make us motivated, like the “Just Do It” slogan that became a core part of the Nike brand in 1988. Then we have the ads that touch our hearts, like the Super Bowl Coke commercial with Mean Joe Greene and the kid in the locker room or the Kodak Times of Your Life series.

British Prime Minister Margaret Thatcher once argued forcefully that “there is no real alternative” to capitalism as an economic system. Nearly 30 years later, equity traders adapted her slogan to fashion the narrative that in prevailing market conditions there is no alternative to stocks, that all other investment opportunities are worse. The acronym TINA popped into Wall Street parlance after the 2008 financial crisis. But it has not been heard much this year. Returns for the Dow are down 9% year-to date, the S&P 500 has lost 13%, the Russell 2000 has declined 15% and the Nasdaq has fallen 21%. Conventional equity funds have seen outflows for 28 consecutive weeks. So, we think a new mantra is now in order, BRANDY: Bonds Really Are Now Delivering Yield.