MARKET EXAMINATION OF THE U.S.

STOCK MARKET FOR JUNE OF 2023


To family, friends, & partners,

It is within my current belief that, as a whole, the U.S. Equity

Markets are trading at a current premium with respect to fair value.

The S&P 500 P/E Ratio is ~24, which is considerably high compared to

past averages. Speculation is running rampant, and the market is in a

volatile state. Bank failures and inflation can also explain this volatile

state. With the Fed expecting to increase the Fed Fund Rate two more

times by the end of 2023, we will see a higher cost of capital for

business. The higher cost of capital should decrease corporate earnings

in the short term before the natural rate of profit comes back into effect.

Also, we are still seeing an inverted yield curve for U.S. Treasury Rates.

This metric shows that the bond market has a negative outlook long

term. I currently think the bond market is more rational than the

common equity market.

Currently, our capital has been primarily allocated into a single

equity. I am a strong advocate for not diversifying one’s portfolio. Anti-

diversifying practices are especially recommended when equities are

overbought, and their prices have been bid up to unfavorable levels. I

will speak about this decision and my investment in more depth at a

later date.

I am not in the business of trying to predict economic data, and I

advocate that time in the market is better than trying to time the

market. I do hope that we see a decrease in asset prices to reasonable

levels in the near term for buying opportunities. Still, as of now, I will

be sitting patiently waiting for another favorable investment to appear.

We will all be looking forward to that day.

Best Regards,


Nick Whitener