It’s not a pretty week, even if you ignore our wintry mix of ugly weather here in New England. We’re getting more news about relatively weak retail sales this holiday season, along with persistent but declining inflation and another interest rate increase from the Federal Reserve.

As was quite clearly telegraphed in recent weeks, the pace of interest rate increases from the Fed slowed, with a 50 basis point increase this week instead of the 75 points of the past few months… but, also in line with past statements, the Fed Governors made clear that they still need to “talk inflation down” by warning us that rates will probably go significantly higher next year, and remain higher for longer, and that the risk of raising rates too much is worth taking if it means they can avoid the risk of easing off too soon and letting inflation fester.

The way I see it, inflation is being choked off, slowly, rates are coming up, more slowly now, the economy is probably slowing down a bit as a result, and investors will probably continue to overreact to each shift in the breeze for many months. Throw in some more new worries about China ,as we see the end of their “zero COVID” policy come up against their less-effective vaccination efforts, leading to the rapid transmission of the disease… which will probably mean more variants develop pretty quickly, and more waves of sickness will spread around a world that is entirely sick of dealing with this pandemic, and it seems that a “Santa Malaise” is more likely than a “Santa Rally”. Pessimism seems back in vogue again, at least for the moment, and yesterday was another “panic sell” day, after what had been a relatively positive few weeks.

So what do we do? Well, I sure don’t bet my Real Money Portfolio on how I feel about the market and the economy on any given day — that’s a recipe for disaster, emotions are fickle and I’m often wrong about the big picture. One thing we can do is focus on companies that are likely to have pretty good results regardless of the holiday season, and regardless of exactly what changes come to inflation and interest rates over the next few months. One of those is Brookfield, and it so happens that this was also a big news week ...