Market Insights: Last Week in Review with Rusty Vanneman, CFA, CMT, Vol. 85

Last week was another tough one in the markets. While the Federal Reserve raised short-term rates another 75 basis points as expected, their expectations for more interest rate hikes were a bit of a surprise to many market participants (Federal Reserve, Sept. 2022). Concerns over potential economic weakness are also growing (AAII, Sept. 2022).

  • In sum, investor sentiment this past week (at least according to AAII) reached its highest levels of bearish investors since March 2009 (which, by the way was days before the stock market began its epic bull market) (AAII, Sept. 2022).

It has been anticipated (or at least talked about) by many market observers that the stock market would eventually go back and test its June price lows (CNBC, Sept. 2022). Well, we’re back there now (CNBC, Sept. 2022). If we do indeed get a test and bounce off those lows, this might be a great time to tax-loss-harvest in taxable accounts.

BeSpoke Investments reported last week:

  • The S&P 500 last Friday closed just above the worst levels of the year, marking a 23.7% decline from the post-COVID highs (BeSpoke, Sept. 2022).
  • The large cap index is still 9% above where it was pre-COVID, sitting on 3% annualized gains since February of 2020 (BeSpoke, Sept. 2022).

Last week’s losses pushed even the quarter-to-date returns for the stock markets into the red (Morningstar, Sept. 2022). No places to hide last week except the US Dollar, as bonds and commodities also both lost ground (Morningstar, Sept. 2022).

For the year, the asset classes with gains are Commodities and Cash (Morningstar, Sept. 2022). Within equities, the two sectors with gains are Energy and Utilities (Morningstar, Sept. 2022).

Deeper Dive

Last week Ten-year Treasury yields finished at 3.70% (up another 25 basis points over the last week); the highest yield last week was 3.77% (Yahoo! Finance, Sept. 2022).

It’s been a terrible year for bonds: According to Bespoke Investments, 2022 has easily been the worst year for 10-year Treasuries in decades (Bespoke, Sept. 2022).

Despite how much yields have moved higher this year, according to Bloomberg’s John Authers, this week’s interest rates are still the lowest (when adjusted for inflation) they’ve been since 1975 (Bloomberg, Sept. 2022). How does that get resolved? Inflation rates could drop (very likely) or interest rates need to keep rising (very likely at least for shorter maturities) or both.

For those who want a handy-dandy chart to see the Treasury yield curve (i.e., what the yield is for each maturity), here you go: US Treasury Yield Curve (Sept. 2022).

  • Note that the yield curve has a normal slope (where one sees higher interest rates for longer maturities) up until three years, where it “inverts” (US Treasury Yield Curve, Sept. 2022). An inverted curve is not normal and is often a leading indicator of possible economic weakness (US Treasury Yield Curve, Sept. 2022).

Here’s something doing well this year thanks to higher interest rates: the US Dollar. It keeps hitting new highs, according to Bloomberg’s New Territory chart from Sept. 25, 2022.

Staying on the dollar, here is some Monday morning commentary from Old Mission on Sept. 26, 2022: “The British pound dropped to a record low on Monday against the US dollar. At one point it was down 4% to $1.0382, it is now around $1.08 as of 8:00am ET. The euro is also trading at a record low versus the dollar. A combination of US rate hikes and massive tax cuts in the UK have sent the foreign currency market into freefall, with so much of it transacted versus the strong US dollar.”

Key economic data last week included two reports that surprised to the upside:

  • Existing Home Sales: Existing home sales declined in August, but also did beat the consensus Sales are down nearly 20% versus a year ago and fell for the seventh month in a row, posting the longest streak of declines since 2007. However, as First Trust notes, the decline in August was also the smallest so far in 2022 at just 0.4% and while it’s too early to be certain, sales look like they may be beginning to stabilize (First Trust, Sept. 2022).
  • Housing Starts: Housing starts increased over 12% in August easily beating the consensus expectations (First Trust, Sept. 2022).

The big items on this week’s economic calendar at Calculated Risk:

  • The key reports this week are August New Home sales, the third estimate of Q2 GDP, Personal Income and Outlays for August, and Case-Shiller house prices for July (Calculated Risk, Sept. 2022).
  • Regarding the Case-Shiller Report, it is still expected that home prices are up by 17% year-over-year. In my opinion, that’s a big reason why investors aren’t more nervous yet – their home prices have stabilized their net worth (Calculated Risk, Sept. 2022).

The trend isn’t our friend here, but the Atlanta Fed’s GDPNow‘s estimate for real (“after-inflation”) GDP growth (which uses actual economic data for inputs) decreased again last week by nearly another 0.2%. The Q3 2022 GDP estimate is now at +0.3% as of September 20, 2022 (GDPNow).

Earlier, we mentioned how bearish sentiment spiked last week. According to this research from Sentiment Trader in a Sept. 22 Twitter post: “This week joins just 4 others in 35 years with more than 60% of respondents being despondent in the AAII survey. One-year returns after the others: +22.4%, +31.5%, +7.4%, +56.9%.”

Speaking of sentiment, who is selling? Well, given positioning and many advisor/client conversations, it doesn’t seem many people are. That said, look who is: Millennials (ChartStorm, Sept. 2022).

Perhaps the mindset to take in this environment is to be “Cautiously Pessimistic” per my monthly commentary for September and, in turn, continue to aggressively diversify portfolios and consider the increased use of active and tactical strategies.

Crypto Corner – Grant Engelbart, CFA, CAIA, Brinker Capital Sr. Portfolio Manager

  • Crypto prices were mixed over the last week – Bitcoin and Ethereum both fell 3%, but other coins such as Solana, Dogecoin, Avalanche, and Uniswap all rose between 3-6%. Ripple (XRP) is higher by 37% on the week as indications point towards a settlement being reached with the SEC soon. Ripple has been in a legal dispute for years and banned from most U.S. exchanges. (Arcane Research, Sept. 2022)
  • According to sources, a bill is being prepared in the U.S. House Financial Services committee to regulate stablecoins, an area generally welcomed for regulation. The CEO of Kraken, one of the largest and early crypto exchanges, is stepping down. Exchange FTX is looking to raise $1 billion at a $32 billion valuation, more than twice that of publicly traded Coinbase. The company Volmex Labs launched volatility indices on Bitcoin and Ethereum inspired by the VIX Index. (, Sept. 2022)
  • No ETF related news or launches this week. (CoinMarketCap, Sept. 2022)

Additional Resources

“I don’t count my sit-ups. I only start counting when it starts hurting. When I feel pain, that’s when I start counting, because that’s when it really counts.” Muhammad Ali (GoodReads, Sept. 2022)

Last week’s Orion’s The Weighing Machine podcast was with Lori Hardwick, who is a C-Suite/FinTech Advisor, Strategic Growth Business Advisor, Speaker, Private Equity Investor, and Board Director on multiple boards past and present, including Orion’s. Thanks for listening. On this week’s podcast, if you want to hear one of the most energetic and enjoyable people in the industry to be around, check out Billy Oliverio, EVP and Chief Marketing Officer at United Planners Financial Services. We’ve had a lot of fun interviews on The Weighing Machine, but this definitely makes the short list of being one of the most fun.

Speaking of podcasts, how about this one: Dr Daniel Crosby with Morgan Housel? Say no more. Standard Deviations Podcast: Guest Morgan Housel on The Psychology of Money from September 15, 2022.

For the soccer/football fans, there is some Wall Street research on who will win the 2022 World Cup in a September 20, 2022 Liberum article. The World Cup will be played late this year.

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Thanks for reading and have a great week! As always, please let us know what we can do better at or Invest well and be well.



Orion Portfolio Solutions, LLC, a registered investment advisor, is an affiliated company of Brinker Capital Investments, LLC, a registered investment advisor, through their parent company, Orion Advisor Solutions, Inc.

The CFA is a globally respected, graduate-level investment credential established in 1962 and awarded by CFA Institute — the largest global association of investment professionals. To learn more about the CFA charter, visit

The CMT Program demonstrates mastery of a core body of knowledge of investment risk in portfolio management. The Chartered Market Technician® (CMT) designation marks the highest education within the discipline and is the preeminent designation for practitioners of technical analysis worldwide. To learn more about the CMT, visit

The CAIA® is the globally-recognized credential for professionals managing, analyzing, distributing, or regulating alternative investments. To learn more about the CAIA, visit

About Rusty Vanneman, CFA, CMT
Rusty Vanneman serves as the Chief Investment Strategist for Orion Advisor Solutions. An industry veteran with more than 30 years of investment experience, Rusty creates relevant market- and platform-related content that supports deeper, more engaging conversations with advisors and investors, educating key internal and external audiences on Orion Portfolio Solutions’ strategies and resources to help deliver favorable investor outcomes, and helps identify new investment offerings to meet growing marketplace demand. Rusty is a host of Orion’s The Weighing Machine podcast and authored the book “Higher Calling: A Guide to Helping Investors Achieve Their Goals.” Rusty has also managed multiple mutual funds and hedge funds during his career and was named one of the Top 10 Portfolio Managers to Watch by Money Management Executive in 2017. Prior to Orion’s acquisition of Brinker Capital in 2020, Rusty was the Chief Investment Officer for Orion Advisor Solutions and prior to that was the President and Chief Investment Officer of CLS Investments. Before joining Orion in 2012, Rusty served as the Chief Investment Officer and Managing Director for a multi-billion-dollar registered investment advisor (Kobren Insight Management) in the greater Boston area. His 11-year tenure at the RIA included a five-year span when the firm was owned by E*TRADE Financial where he also served as the Senior Market Strategist for E*TRADE Capital. Prior, Rusty was a Senior Analyst at Fidelity Management and Research (FMR Co) in Boston. Additional work experience includes Thomson Reuters, General Electric, and as a cattle ranch hand in the Nebraska Sand Hills. Rusty received his Bachelor of Science in Management from Babson College in Wellesley, Massachusetts, where he graduated with high distinction. He holds the Chartered Financial Analyst (CFA®) designation and is a member of the CFA Institute. He is also a Chartered Market Technician® (CMT) and is a member of the Market Technician’s Association (MTA).