September 2021, Chicken Little Portfolio Performance

The Wolf is Still Coming

Chicken Little believes the wolf is merely delayed. 13 years ago, before 'the' financial crisis, US Federal debt was $10 trillion. Today, the US debt is $28 trillion. The Federal Reserve has monetized $7.5 trillion of this sum. So $18 trillion of cumulative deficits financed, in significant part, by printing money.  'The' real crisis lies ahead. 

In the end, the Wolf ate the Sheep

Is the Wolf coming soon?
Chicken Little has begun shorting stocks, betting that the wolf may arrive soon. The all-time high on the Dow Jones Industrial Average was hit on August 16, 2021 at a level of 35,625. If the wolf comes, the Dow may not hit this level again for decades. 

September 2021 performance
The Dow Jones Industrial Average lost 4.17% in September for a year-to-date gain of 12.02%. Chicken Little cowered his way to 0.34%  for a year-to-date return of 7.21%. 

Sept 2021YTD 2021
Chicken Little0.34%7.21%
Dow Jones Industrials-4.17%12.02%

September 2021 was a bad month for most assets. US stocks, non-US stocks, gold and long-term treasury bonds all lost 3-4% in September. Bitcoin was flat in September, but continues to leads all major asset classes in returns over any recent time frame.

AssetSymbolSept 2021YTD 2021
Dow Jones IndustrialsDIA-4.17%12.02%
Non-US StocksEFA-3.22%8.43%
Emerging Market StocksEEM-3.86%-2.03%
US Long-Term BondsTLT-2.88%-7.55%

October 2021 Portfolio Position
Chicken Little has a short position in US stocks (See Chicken Little sells stocks). The 34% of the portfolio short looks like a huge position, and in some way it is massive. That said, the position will be covered if the Dow makes a new high. Because the Dow's high is only about 3% away for the short sale price, the total risk of the trade is about 1% of the portfolio (3% * 34%). 

Previous month's report                 Subsequent Month's report

Chicken LittleDow Jones Industrials
2021 (through Sept)7.21%12.02%
2015 (April through Dec)-2.49%-0.27%
since inception (3/31/15)27.91%117.71%

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