It's there if you look…

In 1837, Charles borrowed $1,000 ($25,000 today) from his dad, and with school pal John, he started his shop in New York City. After three days, sales were only $4.38, leaving doubts about their startup. Then, two years later, he married John's sister and built a family. He had six kids. He had also been building his business, evolving to jewelry of the highest order. Tiffany & Co. (TIF) still exists today.

His daughter Annie in turn had a daughter. Alfreda married Hiram Bingham III, who explored Machu Picchu and brought it worldwide attention in 1911. Their son Hiram Bingham IV was Vice-Consul serving in Marseilles, France, during WWII. In 1939, his job was to issue visas for passage to the United States. The Vichy government signed an armistice with Germany after France's fall. The U.S. was not yet in the war and wanted good relations with the Vichy government. Therefore, the U.S. State Department discouraged visas and showed little compassion for refugees. 

Jacques was born in Vienna, Austria, in 1920. Nazi Germany annexed the country in the Anschluss on March 13, 1938. He was only 17 when he was arrested for being Jewish. However, he was crafty and escaped a Swiss workcamp. He headed to Italy and then France through Ventimiglia. He was arrested in Nice days later and imprisoned at Camp des Milles at Aix-en-Provence. He spent nearly a year in the French-Jewish work camp.

Then he was brought to Hiram Bingham IV's office. He was skin and bones, living on 500 calories per day, in shackles, and hadn't bathed in a month. Bingham was outraged and ordered his cuffs removed, a bath, and some clothes. Bigham gave him a visa for a ship that sailed that day to America on March 30, 1940.

Bingham defied authority, freely issuing visas. He was suddenly yanked from his post, but not before he saved 2,300 Jews from certain death: Camp des Milles prisoners were usually bound for Dachau – a death camp. 

Jacques would have ended up there. Instead, he made it to America. He slept on Central Park benches for a few weeks. Speaking no English, he became a dishwasher, learning Yiddish from Puerto Ricans in the Jewish deli kitchen. He joined the army, married a beauty, had five kids, and crushed the American dream. He had the biggest house on the block and bought himself a Rolls-Royce in 1980. He got a special license plate: GEMACHT. That means "made it" in German, his native tongue.

Jacques Bodner was my grandfather. He died in 2007, but like him, his car was a classic. It was eventually sold to an enthusiast in France who read the original bill of sale tracing it back to Jacques. He hunted down my father, eager to learn more about the car. The story blew him away. So, he took the car right back to its roots: Camp des Milles. He parked it right up front, and gave it the proverbial finger.

I knew I was the grandson of a Holocaust survivor. But it turns out my story goes far deeper – woven with Tiffany's, Machu Picchu, and a life-saving rebel diplomat now honored in museums. It's there if you look. And sometimes the hidden stuff is the most important stuff.

At face value, the market showed strength last week. Then Trump tweet bombed a trade war retaliation against China's retaliation. Friday was ugly. But digging deeper, volumes were thin early in the week when the market rallied and spiked on Friday's sell-off. This echoes my earlier sentiment that the selling was not yet over.

Still, selling wasn't even close to mid-August levels, and the S&P 500 sits at a 2,850 support level:

One-month chart showing the performance of the S&P 500 Index
Yahoo Finance

Selling was heavier in discretionary, materials, and energy. Buying was in utilities, as seen below. But keep in mind, two weeks ago, we saw big selling everywhere, especially energy. That typically marks near-term bottoms, which it did. Compare last week's big money buying and selling to the week ending Aug. 9:

Week ending Aug. 23

Table showing unusual institutional (UI) signals by sector through Aug. 23

Week ending Aug. 9

Table showing unusual institutional (UI) signals by sector through Aug. 9

A few things you need to know:

  • The big-money buying index is at 48.8% but falling. That means that selling is outweighing buying. When it falls below 45%, it usually means look out below.
Chart showing the performance and MAP-IT Ratio for the Russell 2000 Index 
  • However, should the market fall, it will be a buying opportunity. I have continually discussed why the United States is the oasis in global markets. Growing sales and earnings, low rates, and best-in-show remain the reasons.
  • This is summer volatility with low liquidity and low participants. I told you it would be bumpy.

Expect trade rhetoric to continue and for volatility to persist a bit. September is also a volatile time. Last year was one exception, and markets tend to rally into the end of the year. We still have a while to go.

Remember, things may look one way, but that doesn't mean they'll turn out that way. Bingham was asked why he did what he did, and he answered: "My boss said: 'The Germans are going to win the war. Why should we do anything to offend them?' And he didn't want to give any visas to these Jewish people. So, in a way, I had to do as much as I could."

That's how I write to you today. Always do what you can in all endeavors.

The Bottom Line

We (Mapsignals) continue to be bullish on U.S. equities in the long term, and we see any pullback as a buying opportunity. Weak markets can offer sales on stocks if an investor is patient. 

Disclosure: The author holds no positions in any stocks mentioned at the time of publication.

Investment Research Disclaimer