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00:19Good morning. Welcome to the Myers Report Fast 15. It is Friday, August 21st, 2026.
00:27Don Day, our weather guru, will explain why the Midwest is getting flooded and Hawaii is getting hurricanes.
00:35And the stock markets, they are exchanging. Joining our chief economist, Bob Janetsky, today in figuring out what is happening,
00:44we have Carlos Legaspi.
00:46Carlos is a board member of the Myers Report, and even more important, he is the owner of Precise Investments,
00:55a broker-dealer with offices in the U.S., Mexico, and nine South American countries.
01:03He knows the market. Don, why is the Midwest getting so flooded and when will it stop?
01:10Well, it's called the Ring of Fire. It's a phenomenon that we tend to see every summer to some extent
01:16where you get a big high-pressure system over the Southern Plains.
01:21And going back to school, air moves clockwise around a high.
01:26And so that clockwise motion brings moisture up from the Gulf and circulates it right across the Midwest in Corn
01:34Belt.
01:34And this pattern can be persistent. And all you need with that moisture is daytime heating, and you're going to
01:41fire up thunderstorms.
01:42So you basically don't have a storm. You don't have a front.
01:46You just have a very persistent airflow that can last multiple days in a row.
01:52And if you're going to bring Gulf moisture into the Midwest.
01:55Don, how long are conditions like that likely to last?
02:00Well, it can go a couple of weeks. It can be a very stagnant pattern.
02:06Now, it's kind of peaked last week, but to some extent it's still going to continue here for another week
02:11or so.
02:12But it tends to form in mid to late summer where the pattern does get stagnant.
02:19And so if you go back and look at some of the big flooding years in the Midwest, you'll see
02:23a similar setup to what we've seen this summer.
02:25So there's the worst is over, but there's probably more coming.
02:30It's just a little bit shifted more south and west.
02:33So it's not time for us to build the ark.
02:36Not time to build the ark.
02:38But, you know, some people will say we needed more water in the Missouri and Mississippi basins anyway.
02:44And there's some areas of the south that are missing the rain.
02:48So rain is a good thing, generally speaking.
02:52Well, in northwest Indiana, I was starting to see some animals, Mark, walk in pairs.
02:58By the way, Hawaii is getting its second hurricane in a matter of days.
03:03A couple of quick questions.
03:05First off, what's the difference between a hurricane and a typhoon?
03:08No difference.
03:09It's just they're named typhoons in the western Pacific.
03:12That's just kind of a cultural regional thing, but they're the exact same thing.
03:16Okay. Are hurricanes normal for Hawaii?
03:19It wouldn't seem so.
03:20Not frequent.
03:20I mean, Hawaii tends to be in a position, latitude, longitude-wise, that tends to mostly miss them.
03:28However, during El Nino years, they're more susceptible to being hit by tropical storms and hurricanes.
03:35Now, it may not become a hurricane, but it does look like Tropical Storm Moak.
03:39It'll be called M-O-K-E.
03:41It is going to be forming this weekend.
03:44And instead of going through and near the islands like last week's Hurricane Lala, this one looks like it will
03:51clip the big island, possibly with some more rain.
03:54But I tell you, it's only August.
03:57September, October could still bring hurricanes.
04:00So Hawaii is not out of the woods by any means for this to happen again.
04:04John, you mentioned El Nino.
04:07Could you remind us what does that mean for the fall and winter?
04:11What it means for the fall and winter for the U.S. is a wet fall, a cool wet fall
04:16for the south, very wet conditions for the south, winter and spring.
04:20But the northern tier of the United States, including your neck of the woods, Bob, can actually have a milder,
04:27drier winter in an El Nino.
04:30So that's what we should be looking for for Bob.
04:34For Bob, yeah.
04:36And when we get into next month, we can talk about the forecast a little specifically.
04:42But El Nino tends to, in North America, be directed to the southern and southwest and southeastern United States.
04:48But there's impacts elsewhere.
04:50Certainly there's big impacts in Central and South America as well.
04:54The Atlantic, Don, seems to be pretty quiet this year.
04:58Is it going to continue that way?
05:00Overall, yes.
05:01I mean, we continue to see some formation of systems off the coast of Africa that could end up being
05:06tropical storms or hurricanes.
05:08But it's only second half of August.
05:11So there's plenty of time left.
05:13But El Ninos tend to suppress Atlantic hurricanes.
05:16So we will see a decrease in the number of hurricanes in the Atlantic this year.
05:21OK, that's good news.
05:23Carlos, the Iran deal appears to be dead.
05:26Stocks have taken some hits lately.
05:29And gold and silver are up.
05:31Do you think the markets are in trouble?
05:36It's no, but I think it's I think it was a little bit over euphoric in the course of the
05:44summer and having a small correction.
05:49I don't take markets in July and August too seriously because it's relatively illiquid.
05:56I'll be more curious to see what happens after Labor Day once like decision makers come back, becomes volumes, become
06:03bigger and see if it picks up the trend up or or if it's going to, you know, correct a
06:13little bit more.
06:14So, well, are there what are the seasonal factors that might impact the markets?
06:19I mean, are people leaving town?
06:21Does that impact the markets?
06:23Oh, yeah.
06:23The summer is it's it's it's seasonally.
06:26It's always been thinner markets and for bigger swings in both directions.
06:32So it's I lower volumes means higher volatility.
06:38Exactly, because there are not that many buyers, not that many sellers.
06:41So you see bigger swings.
06:43Do you see any particular market sectors that might be facing significant risks?
06:51Well, the the biggest thing happening in the markets right now is it's around interest rates and in the bond
06:59market.
07:01We had a pretty poor 30 year treasury auction that took the yield on the 30 year to highs, 20
07:10year highs.
07:12And which is, you know, concerning at the same time that we in the US announced that we crossed 40
07:20trillion dollars in debt for the first time ever.
07:24And the interest rates, they've gone up, but they don't seem to have gone up dramatically.
07:33Well, it's well, the 30 year treasury where, you know, we kind of touch five, five 30, which is, you
07:41know, 20 year high.
07:42Right. And and even though it's not as relevant as a 10 year, it's concerning enough that the Treasury Department
07:48came in and announced a purchase program that that two days ago brought down significantly the yield of 30 year.
08:05So it's it kind of puts it at odds with the Fed because it's like a bubble.
08:13The yield curve is like the money used to purchase 30 year bonds has to come from somewhere.
08:19It comes from short term debt issuance.
08:22So it's that puts pressure on the short term interest rates, which is more in the purview of the Fed.
08:30So the odds of a hike of Fed Fed funds went up.
08:38So so you think that's kind of and that's what put spook the market.
08:42Yeah.
08:45Bob, you both question for you and Carlos both.
08:48Do you guys think, Bob, do you think the U.S. economy is fundamentally sound?
08:53I do. I do.
08:56Fundamentally sound going through, obviously, a rough period with respect to the inflation concerns.
09:03I mean, we were of the opinion that Iran would buckle and that that problem would get resolved sooner than
09:13it has.
09:13And so long as it drags on, the expectations for inflation and inflation staying up longer will also continue to
09:24drag on.
09:24And that's hit the bond markets.
09:26I agree with Carlos that, you know, these rates are higher than I would have hoped for, higher than I
09:33would have expected.
09:34We're going to see a mortgage rate right now based on where things are of seven percent.
09:39And that psychologically is kind of harmful.
09:43The homebuilders are significantly affected by this.
09:51Carlos, do you agree with Bob that the economy is fundamentally sound?
09:55Yes. And that's some of the voices that are advocating for higher interest rates or an interest rate hike is
10:04saying, if we're going to be facing higher inflation, the time to raise the rates is now that the economy
10:11is healthy enough to handle an interest rate hike and not wait until the economy weakens.
10:18And then you take that toll away.
10:21Yeah, I agree with Carlos.
10:23And, you know, I would just say that the argument that we need higher short term interest rates may or
10:31may not be true.
10:32But I would not want the Fed to artificially pick interest rates up from this particular point in time.
10:40I think the economy is still vulnerable.
10:43But when you want to fight inflation, you want to look at what the cause of inflation is.
10:49Generally speaking, in normal times, the cause of inflation is the Fed has gone overboard and pumped too much money
10:56into the economy.
10:56I don't see that as the main ingredient of sending inflation higher.
11:01I see it's higher because of the conditions in Iran, because of the lack of immediate reduction and the lack
11:11of oil flowing through the world.
11:14And these are things that monetary policy is really not designed to correct.
11:19So I don't see that the Fed can do nothing but harm by trying to force short term interest rates
11:26up.
11:26Now, having said that, the Fed, by setting short term interest rates, already distorts the market.
11:33So I would certainly like to see what I think the new Fed chairman would like to see.
11:39And that is rely a little more on market conditions.
11:42And if the market conditions are that short term rates would be higher, let them go higher.
11:48And so far, I don't see the Fed taking a lot of action to artificially put rates where they are
11:54today.
11:54So I think we're in a pretty good condition, all things considered, with respect to monetary policy.
12:03Carlos, where do you see the economy going and the markets between now and the election?
12:10Well, it's like normally my experience, the seasonality points to higher markets.
12:20It tends to be that if the market, the indices are up between January and September, then active managers start
12:32getting fear of missing out and they start buying again.
12:35So it's kind of like it completes the trend of the first nine months.
12:40So if the first nine months is positive, the last three months are positive.
12:43If it's down the first nine months, it will continue to go down.
12:48Right now, the markets are up.
12:50And so that bodes well for between now and the end of the year.
12:55So we'll see when the market liquefies after Labor Day.
13:01One thing that I expect is higher volatility all the way to the end of the year.
13:05So it's very event driven, especially in Middle East events.
13:09So it's a trader's market.
13:13And the divergence between active and passive management is also happening.
13:20So you're going to see greater divergence and some funds doing great and some funds losing their shirts.
13:27So it's interesting.
13:30It would seem that the Iran situation is going to seem to be completely intractable and unsolvable until it's not
13:39so that the change will be rather quick.
13:42If the change were to happen suddenly between now and the election, Bob, how quickly do you think the markets
13:50would react?
13:50I think it would react very quickly.
13:52And I think that that is the key factor.
13:54You've put it right up front and that's it.
13:58We don't know how long this Iran thing is going to continue in the current state.
14:05It's my judgment, but it's been my judgment all along that the people in Iran who are in control have
14:13a weak hand.
14:14And now it's a weak hand.
14:17And so what they're willing to do is they're willing to see their country get hurt economically, not just now,
14:24but from long into the future.
14:27But why would anyone do that?
14:29Well, they do that because I think they're afraid that if they were to give in, that they basically would
14:35lose themselves, their positions, their lives.
14:38And so they feel they can't give in.
14:40So that's the intractable thing that's holding this up.
14:45But the more Iran's economy suffers, I think the more likely it is that we'll come to a positive conclusion
14:53here.
14:54But the longer it lasts, that's going to have way on interest rates, inflation, and way on stock prices.
15:01It's very interesting where the technical position is in the market today.
15:05We just at yesterday's close, the S&P 500 dropped right down to a key support area, the 21-day
15:14moving average.
15:16And what we would like to see technically is that the index should stay above that.
15:21This morning, we've had some positive moves in the market, but those would have to continue before I'm convinced that
15:29the short-term market is going to be good.
15:31My short-term stock market model, which is based strictly on momentum, it doesn't assume we know anything about the
15:39future, but it suggests we know something about the near term relative to the pressures one direction or another.
15:46It still is bullish.
15:48It still is on a bullish reading and suggests that the odds are about 70% that in the next
15:54two weeks we'll have a higher market as opposed to 30% odds that the market will be down over
16:00the next two weeks.
16:01Okay, thanks, Bob.
16:03Our question for the week, well, there's actually two questions.
16:07The first question is, is there anybody on this panel that does not know who Sophie Cunningham is?
16:16Don?
16:16Well, I know who she is.
16:18Carlos?
16:19I don't.
16:21Really?
16:23Okay.
16:25Bob?
16:26That shows you the significance of this, but I know who she is.
16:31You do or you don't?
16:32I do.
16:34Carlos, Sophie Cunningham is the center of a battle in the WNBA as to whether or not they're going to
16:43let men compete with women.
16:45And there's also the racial component in that they seem to be giving grief to white players.
16:52So my question was, what impression do you think Sophie?
16:55And by the way, Sophie Cunningham is quite attractive.
16:58So the question is, what is the impression that you think that Sophie Cunningham is making?
17:05Don?
17:05Well, I think the WNBA is missing a giant opportunity with Sophie Cunningham because she's brought a lot of attention
17:17to the WNBA and also could bring a lot of fans.
17:21But they appear to be going to a smaller, more radical fan base than a much larger, broader one.
17:28So it's their loss.
17:31Bob?
17:33What the heck is the question here?
17:37What impression is Sophie Cunningham making?
17:40She's making a very fine impression for those who agree, as I do, that there should only be women playing
17:47in women's sports, if this is women's sports.
17:50And she's making a very bad impression for all those who think otherwise.
17:55Well, from my perspective, she is tall, she is hot, she is impactful, she's a great basketball player, and she
18:04can throw a punch and take one.
18:06On that note, have a good week, stay safe, be well, and God bless America.
18:14On that note, have a good week, stay safe, be well, and God bless America.
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