Do you ever “huff and puff’?  Is this question relating to breathing heavily with exhaustion, or is it expressing annoyance in an obvious or threatening way?  In life, we huff and puff when winded or short of breath, from wheezing or feeling done-in; even spent or exhausted.  Often, despite much huffing and puffing about the “bus” service, traffic, or government policy, nothing happens.  Recall the wolf in “The Three Little Pigs”?  The mother pig sent her three little ones out into the world to make their own way.  Each built their own shelter.  The wolf traveled the lane where each lived, and smelling the little pig inside, pounded on the door, “Let me in!  Let me in!”  Each pig yelled, “Not by the hair of my chinny chin chin!”  The wolf was annoyed, declaring “Then I’ll huff and I’ll puff and I’ll blow your house in!”  He blew in the straw house, the wood house, but not the brick house (where all 3 were finding refuge).  The wolf lost his frustrating endeavor after bounding up the roof and climbing down the chimney, where he fell into a huge pot of boiling water in the fireplace.  Whether weary from exhaustion or expressing annoyance, we never know when fear is going to come knocking, or pounding, on our door.

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The first quarter offered lots of “candy” (government spending) and no “spinach” (tax increases).  But that idea started changing in April with government policy shifts: the unveiling of big infrastructure spending (spread over 8 to 10 years), plus new large-dollar child spending programs; both to be funded with higher taxes – corporate and individual.  Taxes are oriented as an aggressive path to pay for massive spending.  At present, the combination of extraordinary fiscal spending and monetary stimulus is pulling forward demand, output, revenue, profitability and investment (perhaps stealing it from 2022 and maybe beyond; called a growth hole).  After such a strong start to the year, and remarkable 12 month recovery, the biggest hurdle the market faces is high expectations and crowded positioning.  At present, there appears to be a peak in positive data and eager market participation (number of stocks rising at the same time), usually found in the first third of a new bull market run.  With so much good news already priced into stocks, any bad news or “miss” could spark near-term volatility.  So let’s ask… Is this as good as it gets?

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Too much of anything can be bad.  Sometimes, it only takes a spoonful, or even less.  In July 2014, the Food & Drug Administration warned about powdered pure caffeine.  Usually added to drinks before workouts for an energy boost or to aid weight loss, or as a dietary supplement. It was also used as a study aid among college students.  In May of 2014, a high school senior in LaGrange, Ohio died, days before graduation, after consuming one teaspoon of powdered caffeine – the equivalent of drinking 25 cups of coffee or 70 cans of Red Bull.  His autopsy found more than 70 micrograms of caffeine per milliliter of blood in his system, more than 20 times that of an average coffee drinker.  The difference between a safe and lethal amount of caffeine is very small.Continue reading→