There was no plan to write a follow-up to yesterday's Your Worldview Matters post. But today's revelations about Ken Fisher are too on point to not bring them into the discussion.

According to this MarketWatch report, "Wealth manager Ken Fisher shocks with off-color comments, doesn’t apologize":

A well-known investor so scandalized attendees at a high-profile financial industry event with sexually offensive comments that several of them broke non-disclosure agreements they signed to attend in order to speak out.

An interesting spat unfolded Saturday on financial Twitter. It started with a tweet from Nobel Prize winner / NY Times columnist Paul Krugman, essentially arguing that national debt doesn't matter. Another financial heavyweight, Nassim Taleb (author of The Black Swan and Anti-Fragile books), responded with a series of tweets ripping that assertion apart. You can see the original tweet and the main point of Taleb's response below.

There are no changes to the DAA lineup for October. Read on for the full details.

DAA is a core portfolio strategy that is designed to help SMI readers share in some of a bull market’s gains, while minimizing (or even preventing) losses during bear markets. The strategy involves using exchange-traded funds to rotate among six asset classes, holding three at any one time.

DAA is a defensive, low-volatility strategy that nonetheless has generated impressive back-tested results when evaluated over full market cycles, demonstrating the power of "winning by not losing."

The recommended categories/ETFs for October are (in order of current momentum):

There is a new Sector Rotation fund being recommended for October. Read on for the details.

Sector Rotation is a high-risk/high-volatility strategy. While its peaks and valleys have been more extreme than SMI's other strategies, it has generated especially impressive long-term returns, as discussed in Sector Rotation is Risky, But Highly Rewarding.

Following a decade of mostly rising stock prices, last year’s fourth-quarter correction of nearly -20% reminded investors that the stock market’s rewards come with substantial risk. Given weakening economic data in recent months, it wouldn’t be surprising if some investors are thinking it might be time to scale back any new investing (or even head for the exits altogether) and wait for the next bear market to pass.

Such timing moves are intended to improve long-term returns, but as we’ve explained before, that’s rarely the result. First, as the last few years have clearly demonstrated, it’s extremely difficult to time these moves correctly. But another reason is often overlooked — timing simply isn’t as significant a factor as most investors think.

As conditions warrant, SMI’s Dynamic Asset Allocation strategy (DAA) looks beyond stocks and bonds to other asset classes, including real estate. Which raises the question: Just what are we investing in when “real estate” is one of the recommended classes? Here’s an explanation.

Why Upgrade?

SMI offers two primary investing strategies for “basic” members. They are different in philosophy, the amount of attention they require, and the rate of return expected from each. Our preferred investing strategy is called Fund Upgrading, and is based on the idea that if you are willing to regularly monitor your mutual-fund holdings and replace laggards periodically, you can improve your returns. While Upgrading is relatively low-maintenance, it does require you to check your fund holdings each month and replace funds occasionally. If you don’t wish to do this yourself, a professionally managed version of Upgrading is available.

SMI also offers an investing strategy based on index funds called Just-the-Basics (JtB). JtB requires attention only once per year. The returns expected from JtB are lower over time than what we expect (and have received) from Upgrading. JtB makes the most sense for those in 401(k) plans that lack a sufficient number of quality fund options to make successful Upgrading within the plan possible. Here are the funds and percentage allocations we recommend for our Just-the-Basics indexing strategy.

The Federal Reserve cut the Federal Funds rate yesterday by a quarter-point to a range of 1.75%-2.00%. This was the second rate cut in just seven weeks and was a bit controversial, even within the voting members of the Fed, as one of the seven voters preferred a steeper half-point cut, while another voter wanted no cut at all.

This split decision is reflective of the broader uncertainty surrounding the economy right now, as there are clear signs of slowing (both here in the US and especially abroad), but US conditions haven't yet reached the point where they are signalling anything clearly problematic.

The stock market fell initially on the rate-cut news, clearly wanting more, but perked up mid-way through Chairman Powell's press conference and ended the day mostly flat. The turnaround came when Powell said, "It's possible that we'll need to resume the organic growth of the balance sheet, earlier than we thought. That's always been a possibility and certainly is now." That was taken by some as a reference to possibly restarting Quantitative Easing — where the Fed intervenes in markets directly, adding liquidity by purchasing assets (bonds) — which has been the stock market's favorite drug over the past decade.

That said, the word "organic" in Powell's answer seems to imply allowing the Fed's balance sheet to increase gradually as the economy grows, without any dramatic QE resumption. But the market knows getting the QE conversation started is the proverbial crack in the door — the first step toward eventually getting those policies re-implemented.

President Trump got the financial world (OK, the non-financial world too!) fired up with the following early-morning tweets today: