We are gonna keep this one short in honor of Labor Day
Well, the August Blues was a real thing.
Stocks finished July super hot but then got COMPLETELY DESTROYED in August. You can thank the Fed for that. Jerome Powell at Jackson Hole was very clear that interest rates were going up as the fight against inflation continues.
Every single industry except Energy (because oil) finished the month down in a big way.
But then September came in like a Super Hero and picked the market right back up. That was until Friday when the markets acted like Superman in the presence of Kryptonite.
Could I tell you why the market is gyrating more than Shakira's hips?
NOPE
MARKET RESULTS (YTD):
Tale of the Tape
Economy
Job Market
All numbers continue to point to a strong labor market. Jobless claims for the month of August declined. Per the JOLTS report, there were 1 million new job openings added to the economy last month.
However, before we could take a victory lap. ADP showed up and decided to rain on our parade a little bit. They released private payroll numbers for August. It showed hiring slowed down in a major way. Going from 268,000 in July to 132,000 in August. The expectation was for 300,000 jobs to be added.
But then the Non-farm payroll came in on Friday and was like
The economy added 315,0000 jobs in August, the expectation was for 318,000 jobs to be added. This pleased investors because it shows the economy is not in a recession. However, this continues to give the Federal Reserve a lot of wiggle room to continue raising interest rates to fight inflation without much fear that unemployment will go up.
Interesting tidbit: Unemployment went up from 3.5% to 3.7% but to the Fed this is a good thing. The number went up not because people are losing their jobs but because more people are entering back into the labor market.
My Takeaway: Ladies and Gentlemen this is what we call, A SOFT LANDING!! If the Fed can play this right, they might just be able to raise rates and bring inflation down without causing a recession. There is still a long way to go but right now things are looking on the up and up. On a personal level, if you want a job or seek better pay, it’s not a bad time to shop around. But the Labor Market is getting tighter.
According to every retailer, holiday shopping should be starting right now. We haven’t even had Halloween yet and the Christmas decorations are already been brought out by stores. Retailers from Walmart to Target to Costco are putting out Christmas items like trees and decorations up for display.
Part of the driver for such an early holiday shopping season is retailers are still reeling from excess inventory. They want to use the holiday season to get rid of excess.
For once, I actually agree with retailers. You should definitely plan for the holidays earlier in the year, so you do not go broke. However, I do not think you need to go shopping just yet. The return policies for most of these stores will not last until January. My advice is this should be a reminder to begin saving up for the holidays but not necessarily to buy anything just yet. But the good news is this is about to be one of the biggest Sales Periods we have ever seen. Retailers are desperate to get rid of the inventory they have on hand
Stats of the Week
A baseball card sold for that amount last weekend surpassing the $9.3 million Diego Maradona's jersey sold for earlier in the year
Nostalgia is a HELL OF A DRUG!!
Sports collectibles space has gone from being worth a total of $5.4 million in 2018 to now worth over $26 billion
I swear people got too much money, I really need to be better at selling because people are willing to pay for almost anything
And what I am selling is actually worthwhile
The cost of the new Lord of Rings: Rings of Power TV show created by Amazon
It is the most expensive TV show ever made
It began streaming on Friday and well it smashed. It had 25 million viewers on the first night alone. More than House of Dragon, which had 10 million
Amazon may just have a hit on their hands
The percentage of single-family homes that were bought by Investors in February
This is one of the reasons for the surge in home prices, where people who make good money in other parts of the country (think Silicon Valley or New York) come to places like Atlanta, to buy up real estate to use as rental properties
They see it as an important part of a diversified portfolio taking away potential homes from thousands of people. Forcing those folks to be renters
Now I am not someone who says you HAVE to buy a house, but I like people to have options rather being forced into one decision
It annoys me that people who live in a community, get paid in that community, pay taxes in said community, and spend in the community. End up not being able to afford homes in the community.
Technology is also making this process much easier for more people to get in on the action.
Not gonna lie I want to play in this arena as well cause in the end if you cannot beat them join them
Looking Ahead
Short week and a boring one for the markets. Apple has an event on Wednesday, where they will show off new (kinda) iPhones, new Watches, and new headphones. But really nothing else to really pay attention to.
Sports I Care About Update
Man U is starting to make me believe again. They have now won 3 games in a row.
I swear this is the definition of a toxic relationship. They pull me back in with the high highs and then DESTROY my heart with their inevitable SUCKING!!
Someone come save me from me!!
Thank you for Rocking With ME
If you enjoy the newsletter SHARE IT.
Remember GENEROSITY > greed
God bless Each and Everyone of y’all
✌🏾
Extras
This is the section I get to dumb stuff that could not make the main newsletter. Typos will be plentiful
Per Morning Brew: “It’s only a matter of time before degrees in computer science alone surpass all humanities degrees collectively, researcher Benjamin Schmidt notes.”
Kids heard the message loud and clear. If you wanna succeed don’t do anything outside of the sciences but especially focus on Computer Science.
Is this a good or a bad thing? No idea
Delayed by Airline, You Can Get Something Back
Department of Transportation released a service dashboard to show you what airlines owe you for delaying or canceling your flight over the year
The government has more say now in airlines because they bailed them out during Covid
Missouri is allowing teachers to spank students if allowed by the parent
More interestingly, I did not realize that in the US there are 19 states where spanking with a paddle is still legal
Nuclear is the Old New Thing
After years of demonizing Nuclear Energy, the entire world finally realizes how vital nuclear is for our energy needs. It only took Russia invading Ukraine and driving up the price of oil and natural gas to wake everyone from their dream world solution of renewable energy will save the say.
Back in March, I made this podcast (link to March 10th Podcast) and spoke about the need for heavy investment in Nuclear Energy. Now, I am very biased because I work in the Utility industry and it was always obvious to us the importance of Nuclear Energy for the grid. Regularly, the company I work for had to answer questions about why we were building Nuclear Power Plants. Now those questions are beginning to change to "How can you help us build more power plants?"
So what countries have changed their stance?
UK, Czech Republic, and Poland all have plans to build new reactors in the next few years
France and Belgium are no longer going to shut down a number of their reactors and plans to build more
Germany, the biggest failures, are seen the error of their ways and will reactivate some of their old nuclear reactors
My Take: The last time we had a massive push for Nuclear Energy was in 1970s, when there was a massive oil and coal crisis. Once again, the only reason we are pushing for nuclear is because of an oil and gas crisis. We keep preparing and fighting the last war, hardly do we actually plan ahead. We should learn from bad governmental planning to always prepare for what is to come not focus on what has already happened. Think of what parts of your life that you may experience crisis and plan for it. Sometimes we do not need a concrete reason to prepare, we just need to have the wisdom to remember that LIFE SUCKS!!