Humans are pattern-recognition machines. We see patterns everywhere! In fact, we’re so good at recognizing patterns that we often see them where they don’t even exist.¹

This shows up frequently anywhere there are big bodies of data. And while well-intentioned, this is one of the big behavioral mistakes we make time and again in personal finance. We look for patterns. And guess what, they absolutely exist, right up until the point where you try to invest your money based on the pattern. Then *Poof!* they vanish into thin air.
 
Investors have tried all sorts of methods to predict the stock market.
 
A great example is the research done by David J. Leinweber at Caltech.² Apparently, he figured out how to predict the stock market using just three variables:
 
1 - Butter production in the United States and Bangladesh.
2 - Sheep populations in the United States and Bangladesh.
3 - Cheese production in the United States.
 
This is amazing! Right?
 
It turns out these three variables predicted 99% of the stock market’s movement!

#TimeToStartAHedgeFund.
 
There’s only one problem: The joke’s on us.
 
In our very human pursuit of patterns, we start seeing things that aren’t really there. We think if something happened a certain way in the past, then it will surely continue into the future. We start to believe—we desperately want to believe—that this pattern will have predictive value.
 
But it doesn’t. And that’s the thing about most patterns—they don’t predict the future; they just describe the past.
 
While some of these silly data mining tricks might be interesting to talk about, they don’t actually help us.
 
Instead, the only pattern that will influence your investing success is your behavior.

• Can you break the pattern of buying high and selling low?
• Can you break the pattern of chasing after the next “big” investment?
• And perhaps most importantly, can you buy low-cost investments in a diversified portfolio based on your values and goals and trust in your financial plan?

Now that’s a pattern we can endorse.

Until next week,
 
Your Eagle Wealth Team
 

P.S. Ever heard of the Super Bowl Indicator? It’s been written about since 1978 when Leonard Koppett, a sportswriter for the New York Times, first introduced the idea. Sorry to break it to you, but it’s not a valid stock market predictor either.3

Truly Crispy Oven Baked Buffalo Wings

Superbowl Sunday is almost here, so what better recipe to share than Buffalo Wings.
 
Cook’s Illustrated came up with a secret ingredient (baking powder) to make baked chicken wings so crispy you’ll think they’re fried. Toss them with Buffalo sauce, serve with blue cheese dip and celery for a delicious snack during the game.
 

Prep: 15 minutes
Cook: 1 hour 10 minutes 
Total: 1 hour 25 minutes 
 
CRISPY BAKED WINGS

• 4 lb / 2kg chicken wings, wingettes & drumettes 
• 5 teaspoons baking powder (NOT baking soda / bi-carb soda) 
• 3/4 teaspoons kosher salt / cooking salt (not table salt, too fine)

SAUCE

• 4 tbsp (60g) unsalted butter, melted
• 1/2 cup Frank’s Original Red Hot Sauce
• 1 tbsp brown sugar
• 1/4 tsp kosher salt / cooking salt

BLUE CHEESE DIP

• 1/2 cup crumbled blue cheese, softened
• 1/2 cup sour cream
• 1/4 cup mayonnaise , preferably whole-egg
• 1 clove small garlic , minced
• 1 – 3 tbsp milk
• 2 tbsp lemon juice
• 1/2 tsp kosher salt / cooking salt
• Black pepper

TO SERVE

• Celery sticks

INSTRUCTIONS
 
CRISPY BAKED WINGS

1. Dry overnight (optional) – If you plan ahead, lay the wings on a rack on a rimmed baking tray and let them dry uncovered in the fridge overnight. Alternatively, pat them dry with paper towels.
2. Preheat the oven to 250°F/120°C (all oven types). Put one oven shelf in the lower quarter of the oven and one in the top quarter.
3. Line the tray with foil. Put a rack on the tray then spray the rack with oil.
4. Toss wings – Place the wings in a large bowl. Sprinkle over baking powder and salt. Use hands to toss well (or shake in ziplock bag) to coat wings evenly.
5. Bake 30 minutes on low temp – Place the wings skin side up on the rack (ok if snug, they shrink). Bake on the lower shelf in the oven for 30 minutes.
6. Bake 40 minutes on high – Move the tray up to the higher shelf and turn the oven up to 425°F / 220°C (all oven types). Bake for a further 40 to 50 minutes, rotating the tray halfway through. The wings do not need to be turned over. They are ready when dark golden brown and the skin is very crispy.
7. Toss in sauce – Transfer the wings into a large bowl. Pour over sauce and toss to coat. (Alternatively, serve wings plain with Buffalo Sauce for dipping).
8. Serve immediately with Blue Cheese Dip (for both wings and celery sticks dunking)!

 BUFFALO SAUCE

1. Whisk together the Sauce ingredients until the sugar is melted. Keep warm or reheat just prior to using.

 BLUE CHEESE DIP

1. Mash the blue cheese with sour cream until smooth (or to your taste).
2. Add remaining ingredients and mix well until combined, using milk to get it to the consistency you want. Store in the fridge until required. Remove from the fridge 15 minutes before serving.

Recipe compliments of Recipetineats.com
https://www.recipetineats.com/truly-crispy-oven-baked-buffalo-wings-my-wings-cookbook/#wprm-recipe-container-19914

The Week on Wall Street

Stocks pushed higher last week as investors cheered mega-cap tech corporate reports and a better-than-expected employment report.
 

Stocks At New Highs

At the beginning of the week, stocks surged, anticipating fourth-quarter corporate updates from tech companies and the Federal Reserve's two-day policy meeting; this led to the S&P 500 Index reaching a new record high on Monday.

The market remained relatively stable for the rest of the week until Wednesday, when the Federal Reserve announced its decision to maintain interest rates within the 5.25-5.50 percent target range. The Federal Open Market Committee's (FOMC) news unsettled investors, who anticipated that rates would remain unchanged but expected more specific guidance on the Fed's plan to lower interest rates.7

On Friday, the job report for January revealed the addition of 353,000 new jobs, surpassing the forecast of 185,000. This strong report did not negatively impact the markets. Instead, investors interpreted it as confirmation of a robust economy.8
 

Fed’s Mixed Signals

The Fed's decision to keep rates steady left some investors disappointed, as they had been hoping for indications of rate cuts in the coming months; this led to a decline in stock prices on Wednesday, with increased selling towards the end of the trading day.

The Wall Street Journal’s headline after the FOMC meeting on Wednesday suggested that rate cuts were possible but not expected immediately. The FOMC's policy language, released after the meeting, indicated a subtle shift from considering rate cuts to proposing they could be possible unless inflation became a concern.9

^{Source: YCharts.com, February 3, 2024. Weekly performance is measured from Monday, January 29, to Friday, February 2.
ROC 5 = the rate of change in the index for the previous 5 trading days.
TR = total return for the index, which includes any dividends as well as any other cash distributions during the period.
Treasury note yield is expressed in basis points.}
Any companies mentioned are for informational purposes only, and this should not be considered a solicitation for the purchase or sale of their securities. Any investment should be consistent with your objectives, time frame, and risk tolerance