Daily Commentary

MarketMinder’s View: Here is an interesting thing that may be coming down the pike, pending the 60-day public comment period and final rulemaking. The SEC proposed nixing a 2005 rule requiring “trading platforms to execute buy and sell orders at the best possible price. The agency on Thursday proposed the elimination of the trade-through rule, which forbids platforms from completing a trade at a price that is worse than the best available price across all U.S. exchanges, even if that means filling the order at a competing market.” Regulators believe that while the rule made sense in 2005, basically the dark ages for electronic trading relative to today, modern connectivity makes them moot—and a financial albatross for brokers, forcing them to pay through the nose for “expensive market data feeds linked to a bevy of exchanges, including overlapping ones that proliferated as a direct result of the rule.” To us, this looks procedural and shouldn’t affect the overall trade execution you get when you decide to buy or sell. Brokers already have a duty to seek best overall execution for their clients, which stretches well beyond the execution price to include liquidity, speed, mitigating the risk of trade failure and more. If the rule changes, it would essentially give brokers more flexibility to fulfill this duty rather than being hamstrung by a price mandate (and given how bid/ask spreads have narrowed, the difference may amount to a penny or less per share). Not that we are taking a stance for or against—just pointing out that this tweak, should it go through, looks highly unlikely to leave investors worse off.

MarketMinder’s View: Per the article, The World Bank has revised its forecast for 2026 global economic growth down to 2.5% from 2.9% in January, largely tied to elevated commodity prices and interruptions to trade stemming from the Iran war, which it paints as “the biggest supply shock in 50 years.” As a consequence, the body says the US will grow 2.2%, outpacing Europe and Japan, with Gulf nations Kuwait, Iraq and Qatar hardest hit—whose growth will flatline. Now, read all that text again, which is literally what the article says. Does that square with “worst hit since COVID”? This is all a lesson in “Worst Since” logic, which relies on the reader to conflate the present with the comparison, even if the language doesn’t specifically mean that. In that vein, consider: The lockdown-driven recession was an intense (but short-lived) global contraction in economic activity. That is a far cry from this forecast. Then again, even the forecast’s depiction of supply shocks is a little questionable. Consider 2021/2022. The supply chain was so disrupted you couldn’t buy toilet paper in major US cities—and others worldwide. Goods of all kinds saw shortages! Even in energy, Europe in 2022 didn’t have the infrastructure to import natural gas in volume. Now it does. Prices were orders of magnitude higher then. Oil? Yes, the Strait remains largely closed (even though reports suggest some 2 million barrels are quietly exiting via tankers today). But workarounds mean some 7 million more barrels are avoiding the Strait via pipeline. So, look, this forecast does show economic expectations are down, which is bullish. But this coverage of it is even more dour, which helps keep sentiment broadly in check (even if pockets of AI froth exist).

MarketMinder’s View: Despite recent stock market churn, gold is down again this week, with the slide through early Thursday putting it down -5.9% year-to-date, per FactSet data. This follows the year’s early, 23.7% boom through January 29. All this illustrates some core points that this article frankly misses. One, gold is volatile. Very volatile. More volatile than stocks. Hence, the big January boom. And the bear market gold is now in (it is down -23.9% from January’s record high). Two, this is all coming as war breaks out and oil prices and inflation fears surge. Gold is supposed to hedge you from that stuff, if you buy the common wisdom. You shouldn’t buy that thinking, though, because it has never been true. Hence, all the gymnastics this article goes through to try to explain why gold isn’t up given these supposedly “bullish” drivers are totally and entirely unnecessary. Accept the point: Gold is no haven. No hedge. No chaos cushion. It is a commodity with little industrial use that sways on little more than fickle sentiment. It has no place in a well-constructed portfolio, in our view.