February 2023 Investing Update

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For the month of February, the DOW lost 1430 points. That erases all gains from the previous month. Interest and dividend income was $1,603 for the month. Withdrawals for living expenses came to $1,014 for February. YTD my retirement account is up by +2.21%. The 4.2% return on treasury funds is helping to minimize stock losses. I decided to sell the 100 NRG shares that I purchased in January because the earnings report was worse than expected. I bought another 50 shares of KHC (Kraft Heinz) with the proceeds. KTB (Kontoor Brands) has increased nicely since I sold it last month. I regret that move. I guess I’m now a bit Leary of holding individual stocks too long in this market, having held PTRA and TLRY longer than I should have. Those two represent a combined loss of $6890 and are only worth $1900 at this point.

It is extremely frustrating waiting for new trends to become profitable. The transition to electric vehicles, the legalization of marijuana, the deployment of robotics, and the adoption of blockchain are taking much longer than expected. Now the next big thing is artificial intelligence. Every time I invest in one of these things, I end up giving up waiting for companies that I have invested in to make money. In an inflationary environment it is easy to find a reason to not invest. It is easier to make a negative argument because high interest rates have such a negative effect on the economy. I don’t expect this to change until interest rates reach their peak. The Fed raised the target range for the fed funds rate by 25bps to 4.5%-4.75% in its February 2023 meeting, dialing back the size of the increase for a second straight meeting but still pushing borrowing costs to the highest since 2007. Rates will need to go higher before the rate of inflation is under control. Meanwhile, the federal budget is out of control, placing government operations at risk of shutting down again, at least temporarily.

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