Buffett's advice for beating inflation: 'Be exceptionally good at something' [Video]

For Mother's Day weekend it seemed appropriate to conjure the spirit of the Oracle of Omaha for advice on beating inflation, advice a mother would be likely to give.  Truly, these are not just words of wisdom for beating inflation but for successful investing and, for that matter, success in general.  Enjoy -- and enjoy this beautiful weekend.  

Wall Street ends down on fears inflation will force tougher Fed tightening

Volatility was the order of the day as the Dow kept swinging back and forth between near 500 point losses and then touching near break-even three times during the session to finally close 98 points down.  Yesterday’s huge rout did not encourage bargain hunters just yet but, just like yesterday, fears of a ¾% June rate hike to calm inflation spurred on the sellers and, like yesterday, this was all despite Powell insisting that would not happen.  So it was a second day of emotions and fear ruling the market despite strong fundamentals and a glowing jobs report that saw nearly 40,000 additional jobs than expected.  Next week we get the CPI inflation report.  Perhaps that will calm things down.  Volume remains above average at nearly 13.5 billion. 

Wall Street tumbles as investors fret over bigger Fed rate hikes

Will this market ever behave rationally again? Yesterday’s huge rally was a clear indication that investors were excited about the ½ point rate hike in the battle against inflation.  Today we find out that may have been an impulse buy and that when they took overnight to think about it, the thought that dominated was – will it really work?  And it was doubts about that which triggered today’s massive sell off with investors now convinced that June will bring another hike, this time .75%.  This was despite the fact that Powell was both specific and emphatic yesterday in stressing this would not happen. As today’s expert put it, “Investors aren’t looking at fundamentals. This is more of a sentiment issue.”  In other words, the sell off is rooted in fear rather than reason.  Which brings us back to the original question – will this market ever behave rationally again?  Perhaps as has happened many times before, cooler heads will prevail tomorrow, conclude everyone dramatically overreacted today, and there’ll be another big rally.  Volume was quite high at over 13.4 billion. 

Wall Street closes with sharp gains after Fed's interest rate hike

All three indexes were straddling pretty close to break-even all day long until about 2:30 p.m. when suddenly everything went crazy and the market zoomed way up in the final hour.  After having its worst days in two years in recent sessions, today it was the best day in two years with all the indexes up triple digits, the Dow over 932 points. It was likely around 2:30 that the Fed made the announcement making the ½ point rate hike official and validating there would likely be more coming before year end.  And I guess investors decided they really wanted that hike to tame inflation as that last hour saw the biggest spree in a long time, volume considerably above average at just under 13.5 billion.  This was despite less hiring and a loss of momentum in the services sector. As always, the hike benefited bank stocks which jumped 3.5% and 2 year Treasuries soared to their highest yields in 3-1/2 years. 

Wall Street ends higher after choppy session ahead of Fed

Dow down as much as 150 in early session and then up as much as 300 points later before dropping into the red again in late afternoon and then recovering to a 67 point gain at close and near break-even for the other indexes.  It’s a virtual certainty that the Fed will announce a ½% rate hike on Wednesday. Yesterday the experts were saying that the Fed actions have already been priced into the market.  Today they are saying, “The number one driver of all volatility has been the Fed hawkish rhetoric” so Wednesday’s update “is a major catalyst.” Doesn’t sound like they really think it’s priced in.  Tuesday we saw extreme volatility ahead of the announcement. Who now knows what Wednesday’s announcement will bring even though it’s been widely expected for some time. Volume was very close to average at 11.3 billion.  

Wall Street up before Fed meet as tech buying punctuates volatile trade

All the indexes down, way down, as late as 3 pm, the Dow down more than 500 points. Then in the final hour everything rebounded for all three indexes to close in the black. Or as today’s expert put it, “Someone who likes to look for long-term opportunities, this is the land of opportunity right now” as the megacap tech names “which stand to remain key parts of the economy for years to come, as being ‘on sale.’”  Many of the names that got beaten down last week – Facebook, Nvidia, Microsoft, Amazon, Apple – all climbed on Monday between 2 and 5%.  The even better news is that all the fears over the Fed’s upcoming rate hikes are by consensus all priced into the market already. So declines are being used as buying opportunities.  Volume was considerably above average at 13.2 billion. 

4 Growth Stocks, 4 Value Stocks to Buy

As the battle between growth and value rages on, here are the latest and greatest picks from both sectors from this week's U.S. News Invested.  As always, there is a great deal more detail on each stock that can be had by clicking on the link below.  Hope everyone had a great weekend.