Well, the markets were all over the place last week. One day, they were up 2%. The next they were down 3%. Things were all over the place last week. There is only one word to describe everything that is happening right now and that is
There are just so many unknowns moving into the future. Here are a few questions investors are trying to figure out, according to Kyla
what will the Fed do? What’s going on with the debt ceiling? What will the Omicron do? What will OPEC+ do? What will the yield curve do? What will supply chains do? What will energy prices do (looking at you, nat gas)?
And the answer to all of these questions is a massive
But when we zoom out, the returns for the entire year has been quite nice:
So as much as people are panicking in the streets. Readers of this newsletter should be chilling!
Tale of The Tape
Seems the Christmas spirit is really starting to flow as we bring the year to a close. Corporations are actually trying to be nice this year. Layoffs fell to the lowest level in over 28 years in November. After hitting crazy highs last year, employers announced 303,000 job cuts. Which was 86% less than this same point last year. Most layoffs in the month of November were due to vaccine mandates, according to business coaching firm Challenger, Gray & Christmas. But I think it is LESS corporations feeling the holiday spirit and MORE the labor market forcing employers to hold on for dear life
A Christmas Miracle!
On Thursday night, Congress agreed to pass a temp bill that will fund the government through February. Once again averting a government shutdown but did we really avert it? Or just kick the ball down the road and have to do this song and dance all over again in February?
This is why no one thinks the government can do anything. But I will take it cause a lot of people depend on that government paycheck.
Another Christmas Miracle!
Your gas prices might be coming down. OPEC+ met last week and agreed to give more oil to the world.
The Cartel that controls basically every drop of oil that flows in the world met on Thursday and agreed to increase the amount of oil being produced. Which was a huge sigh of relief for the entire world as we have been going through an energy crisis. However, they left the meeting open to making changes as necessary due to the new Omicron variant.
Essentially, they want to throttle down production if Omicron becomes worse and causes less travel. They DO NOT want oil to go back negative like it did last year. After oil hit a high of $85/barrel in October, it has steadily been coming back to Earth and now sits around $70/barrel.
The Miracles Ran Out-ish
Economist took a swing and well they missed BIG once again on jobs expectations for the month of November. After feeling really good about the job gains of October, it was expected that the economy would add another 550,000 jobs in November.
Well, that def did not happen.
The economy only added 210,000 new jobs but the unemployment rate dropped from 4.6% to 4.2%. So what the heck is happening. When you dig deeper into the report it is actually not nearly as bad as portrayed by the GLOOMY DOOMSDAY headlines that Media is touting. You know the saying “Numbers Never Lie” but they do not tell the whole story.
Well, that is the case in this situation. There are two surveys that are carried out by economists to get a good picture of the labor market. One is a survey of employers. The second is a survey of employees. Per the employees' survey, 1.13 million jobs were added in the month of November which makes a lot of sense as businesses increased headcount in preparation for the holiday season.
So why the disconnect?
I am no expert on this so I'mma give it up to Kyla to explain:
“One of the weirdest reports I have ever seen,” said Danny Dayan, chief investment officer at Dwd Partners. (ahhhhh)
There is a bit of a conundrum here!! Job growth flatlined (the smallest gain in 2021), but households are employed more?? 4.2% unemployment is solid, but what is actually going on?
The establishment survey suggests employment rose just 0.1% in November, with payrolls increasing only 210k versus the revised 546k October gain
But the household survey suggests employment surged by 0.7% (+1.1 million)!
A miss on headline numbers BUT Wage growth is absolutely flying because you have to attract people somehow right??
So we have to wait for the revisions to really figure out whats going on.
Looking Ahead
My favorite Economic Indicator gets released next week Friday.
“The Consumer Sentiment Index”
It has been falling for the last few months but I am kinda expecting it to rebound for the month of December. Mainly because it’s the holiday season and people are with their family and buying gifts and spending money on services. But I could be very wrong. Inflation is still going strong and people do not like paying higher prices for things.
Apart from that, expect more DOOMSDAY headlines. But in reality, things will not be as bad.
On Friday, the November Consumer Price Index (CPI), better knownt to the everyday person as Inflation rate for the month of November, will be released at roughly 8:30 AM Eastern Time (why I put all those specifics, we will never know). This will play a big role to the actions the fed will take in their December 14th FOMC meeting.
Companies reporting next week, AN ABSOLUTE
Totally Unnecessary Man U Update
They actually won a game! I am just as shocked as you are. Is this the beginning of things turning around?
NOPE, not getting my hopes up.
Ronaldo scored his 800th goal which is just simply AMAZING!!
Before I start believing again in Man U, I will need to see them not just survive games but actually thrive and dominate in matches.
Thank you for reading
I hope you all have A WONDERFUL week. I will see you back here on Wednesday for another post. In the meantime, Go subscribe to Rambling Mind Podcast for mid-week stock market updates. You can also catch me on TikTok, Instagram, and YouTube every day.
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God bless Each and Everyone of y’all
✌🏾
-Kelechi