The Good Shephard and Shifting Pastures

One for Paul, One for Silas, One for to make, my heart rejoice,
Can’t you hear, my lambs a calling? Oh, Good Shepherd, feed my sheep

Traditional American Hymn

I select my theme from a piece so important to me that I consider it among a chosen few (Cat Stevens’ “Longer Boats” and the Dead’s “Uncle John’s Band” come to mind) that are not so much songs, but prayers.

Though “Good Shephard” has materialized, musically, in many forms, dating back to the early 19th Century, for most of us (me included), only one comes to mind – Jorma Kaukonen’s now-copyrighted arrangement on the Jefferson Airplane’s “Volunteers” LP, which Jorma has continued to perform, night in and night out, long past the Airplane’s consignment to the junk metal heap, through his continued Hot Tuna work, and as a solo artist.

It is rendered timely because, as I read this past week, Jorma has shuttered his iconic Fur Peace Ranch, nestled as it is in Northeast Ohio, has sold off the property, and is fixin’ for another round of truckin’ his blues away.

But more about Fur Peace in a bit.

Because they’s droppin’ like flies. Again. Last week featured the passage of two of our irreplaceable cultural icons: Willie Mays and Donald Sutherland. Both shared a common characteristic: everyone loved and respected them. Everyone.

I will keep my tributes brief. Mays was almost indisputably the outstanding player of his era, and maybe the best of all time. In terms of the latter, I might shade towards Babe, if for no other reason than that he was on his way to a Hall of Fame career as a pitcher before he ever entered a daily starting lineup. But, in comparing the two, it bears remembering that Mays ended his career a skinny 55 dingers short of breaking Ruth’s long held record of 714, notwithstanding that his early career was interrupted by a two- year military stint during the Korean War. Might he have gone yard at least 55 times in those two forsaken seasons and thereby broken maybe the most iconic record in sports? Sure seems possible.

Then there’s Sutherland. So. Much. Magic. But I will always think about him – first and foremost – as Oddball in the magnificent “Kelly’s Heroes”: a leather-helmeted, anachronistic hippie, temporally teleported into the front lines of WWII Europe, fully twenty years before being a hippie was even a thing.

But now, back to Fur Peace. Which, until this past week, was a Jorma-managed guitar instruction camp for old geezer hackers such as myself. There, for a very modest fee, one could spend a long weekend sleeping in bunkbeds, showering communally, choking down mac and cheese, and joining in multi-dozen hacker jams of songs such as “Death Don’t Have No Mercy”.

All taught by Jorma. And, occasionally by other luminaries such as his running mate Jack Casady, Larry Carlton, and other top tier shredders.

I always wanted to go, but my family never let me. And now, of course, it’s too late.

But Jorma is 84, and, as far as I’m concerned, he can (and should) do what he wants. The good shepherd is thus shifting pastures, and here’s hoping they are greener ones.

Investors are routinely forced to do the same, to find new fertile grounds for their ovine financial flock. But the question is: whither, across the financial landscape, should they roam? Short-term, the answer is unclear. We’re in the doldrums of the last week of Q2. School’s out. The 4th is just ahead of us. Market data flows have slowed to barely a trickle.

All of which has made for thin gruel in terms of investment opportunity. Case and point: Friday marked the once-vaunted options “Triple Witch” (or, if you will “Quadruple Witch”) wherein a quaint $5.5 Trillion of puts and calls linked to American equity indices expired into oblivion. Time was that such action would, at minimum, draw the attention of the investment community. But not this year. It was a complete snoozer. The sound that you heard, if any at all, resembled nothing so much as 39 acoustic guitars slamming their way through some incoherent 12-bar blues (set of course in the key of A), somewhere in Northeast Ohio.

Not that I wish to complain. The Gallant 500 is up something like 38% over the last 8 months, and if it does nothing but continue this trend, we’ll all have cause for celebration.

But I ask again, in the short term, whither should we point our hooves? To NVDA, which for a brief time last week, sported a greater capitalization than either the French or the British equity complexes? Yawn. So does AAPL and MSFT. And they been around quite a while.

NVDA backed off a bit on Friday and is now worth less than not only AAPL and MSFT, but also than the equity complexes of the Brits and the frogs. Its losses on Friday were greater than the market capitalization of all but thirty publicly traded companies.

Such are the wages and humiliations of life at the top.

Trump debates Biden this coming Thursday, and that should be quite a show. I doubt, however, it will move markets in any sustained manner. First principals suggest that the former’s drawing of a second three-card inside straight in November is the more bullish scenario. But allow me to offer some premature risk management advice: if this indeed comes to pass, I’d think twice of loading the boat and expecting similar outcomes to those of late 2016.

In any event, I anticipate that the next couple of weeks will be an authentic slumber-fest. However, I do believe the action picks up in the third quarter. The data flows should be interesting to say the least. The Fed may tip its hand, and, in foreshadow of this dynamic, consider that while the futures market has upped the probability of a late July rate cut to 10%, the Atlanta Fed’s Q2 GDP predictions are a Milton Friedman, slow growth wet dream:

However this plays out, undoubtedly, some Gloomy Gus types will, shoulder to the wheel, and try to test this extended rally. And they might succeed in breaking it. Or not.

Domestic politics, including our two quadrennial conventions, should be interesting. Geopolitics, with Bibi possibly addressing Congress, should be interesting. There’s earnings, Inflation, GDP, the FOMC, AND the Olympics, to anticipate.

And who knows? Markets may, for nonce, be bi-directional.

But, for now, the tape ain’t got no mercy in this land. It remains a tough go for market hackers, and even for those with pretensions to trading competence. And the associated timing is unfortunate, with Friday being the cutoff date against which we must measure first half performance.

Seeing as how there’s not much doing in the markets and given my anticipated pickup in the action post- Independence Day, there might be worse times to take a little breather.

But if you simply can’t forsake the action, you may want to take a glimpse at the Mexican Avocado market: which has gone parabolic this month, and quadrupled this year:

Not gonna lie: 850 Pesos is a big nut to pay for 9 kilos of that admittedly luscious fleshy fruit. And as your risk manager, I can’t authorize you to trade these bad boys. The market is controlled by cartels, they routinely burn down the fields. U.S. inspectors often find it easier to examine Iranian nuclear facilities than they do the agricultural fields of Michoacan.

To top it all off, Mexico has a new left leaning government, of which I am skeptical, even if it is overseen, somehow, by a newly elected Jewish woman (which I applaud).

So, if you must dive in here, you’re on our own. As for my part, I’ll stick to consumption, perhaps cutting back for budgetary reasons, and reminding myself to be thankful that at least it’s not Super Bowl season.

Thus, in winding up, we’re looking at zombie conditions across the non-avocado portion of the capital markets. And I’d like nothing better than to pack y’all off to the Fur Peace ranch, for some 12-bar, communal shower sonic dissonance. But it’s closed.

It saddens me indeed that I never got there. But I did get to meet Jorma once, and have the following visual evidence to verify this outrageous brag:

For those keeping score, that’s me on the left, placing Jorma on the starboard side of this image.

It was a long time ago. In a far away place, and I will go so far as to offer the opinion that we have both have aged magnificently.

And we both keep playing. And I advise you to do the same.

And though death don’t have no mercy in this land, we can keep the faith that somewhere in the great beyond, Willie is lording over the pastures of a heavenly Center Field, and Oddball is drinkin’ some wine, eatin’ some cheese and catching some rays in the rubble of a village in occupied France.

And that the Good Shephard can indeed hear our lambs a’calling, and will, as always in the past, feed our sheep.

TIMSHEL

Posted in Weeklies.