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Now *that’s* good news: another blockbuster real retail sales report

  – by New Deal democratYesterday I wrote that the financial and production sides of the economy still looked very positive, and that today’s retail…

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This article was originally published by Bondad Blog

 

 – by New Deal democrat

Yesterday I wrote that the financial and production sides of the economy still looked very positive, and that today’s retail sales number would be especially important.

Well, they were very positive, clocking in at up 1.7% month over month in October. Even after inflation, “real” retail sales were up 0.7%. September was unrevised. Although real retail sales are down -2.2% from their April peak, they are +13.5% higher than they were just before the pandemic hit, and 4.9% higher than January of this year:

In September I wrote that ”while the recent decline from April is consistent with a slowing economy ahead, if sales stabilize here I don’t see this as a harbinger of an actual downturn.” That still looks correct, particularly as real retail sales are up over 2% since then, and 9.5% higher YoY. 

How extreme is that? The below graph subtracts 9.5% YoY growth from retail sales from 1948 through 2019:


With the exception of 2 months in 1983 and 1984, real retail sales haven’t been this strong since the early 1970s! That’s the last time the US had such a worker-favorable economy.

This also explains a great part of the supply chain bottleneck, since it is incapable of handling such a sudden jump in consumer demand. Here’s a graph I came across a couple of weeks ago showing activity at the two big California port facilities:

In other words, even though the ports are processing record volumes, they *still* can’t keep up with the increased import demand.

Now let’s turn to employment, because real retail sales are also a good short leading indicator for jobs.

As I have written many times over the past 10+ years, real retail sales YoY/2 has a good record of leading jobs YoY with a lead time of about 3 to 6 months. That’s because demand for goods and services leads for the need to hire employees to fill that demand.  The exceptions have been right after the 2001 and 2008 recessions, when it took jobs longer to catch up, as shown in the graph below, which takes us up to February 2020:


Now here is the same graph since just before the onset of the pandemic. Note the scale is much larger due to the huge downturn during the lockdowns and the comparisons one year later:


Last month I argued that, despite the lackluster initial jobs reports for August and September, this “argues that we can expect jobs reports in the next few months to average out about even with those from one year ago, which averaged about 500,000 per month.”

Well, two weeks ago those months were revised well higher, and October came in at 581,000 jobs added – which means that job growth indeed has continued to average about 500,000 per month. And should continue to do so in the next few months.

Economics

Jim Quinn: Fear Of Our Escalating Power Is Leading Elites To Increasingly Reckless Directives

Jim Quinn: Fear Of Our Escalating Power Is Leading Elites To Increasingly Reckless Directives

Authored by Jim Quinn via The Burning Platform…

Jim Quinn: Fear Of Our Escalating Power Is Leading Elites To Increasingly Reckless Directives

Authored by Jim Quinn via The Burning Platform blog,

The Wall Was Too High, As You Can See

Hey you, out there in the cold
Getting lonely, getting old
Can you feel me?
Hey you, standing in the aisles
With itchy feet and fading smiles
Can you feel me?
Hey you, don’t help them to bury the light
Don’t give in without a fight

Pink Floyd – Hey You

I wrote an article in December 2012, a week after the Newtown school shooting, called Hey You. My interpretation of this classic Pink Floyd song was related to how our culture has created generations of alienated and isolated people, allowing Big Pharma to peddle their pharmaceutical concoctions to the masses as the “easy” solution to living “normally” in a profoundly abnormal society. My contention was these mass shootings by young men (Newtown, Columbine, Aurora, Virginia Tech, Tucson) were caused by the Big Pharma psychotropic drugs prescribed to all these young killers by sick industry peddlers (aka physicians).

The hugely profitable Big Pharma solution to alienation, isolation and depression is drugs that turn a percentage of those afflicted into psychotic killers. The article’s premise was how our techno-narcissistic society, encouraged and enabled by our totalitarian overlords through mind manipulation, drugs, public education indoctrination, and propaganda, has purposely created the alienation, isolation, and hopelessness to further their goals of power, control, and wealth.

When it comes to dystopian literature, there is always a clash between Huxley’s softer totalitarianism versus Orwell’s boot on your face tyranny when assessing how our governments enforce their dictates upon their subjects. The Wall certainly has an Orwellian bent, as it explores the issues of abandonment, isolation, alienation, authoritarianism, the brutality of war, a tyrannical conformist educational system, and the walls individuals and society build to protect themselves from having to confront reality and deal with the consequences of their actions.

Once alienated from society, having built a wall between yourself and the outside world, attempting to reengage with society can be almost impossible, as the wall becomes too high, and no one can hear your pleas. Sometimes, there is no escape.

The opening lyrics are haunting to me. I have felt like I’ve been out in the cold since the outset of this pandemic of herd madness in March 2020. I’ve gotten older and feel older. While family, friends, and coworkers have been drawn into this vortex of falsity, I feel like I am standing alone behind walls constructed by the government, the media, and society in general. It’s lonely when you chose to make a stand against the lies being peddled 24/7 by corrupt politicians, fake news pundits, faux medical “experts” bought off by Big Pharma, mega-corporations, and Hollywood propagandists playing their parts. These demonic forces have tried to bury the light of truth under an avalanche of lies.

I’m unsure of their true purpose, but I am sure it will not be beneficial to me, my family or the honest hard-working people trying to survive this dystopian nightmare. Most days it feels like the evil forces arrayed against me and other lovers of liberty and freedom have the upper hand and cannot be defeated. I do feel isolated and alienated from the majority, as they have been psychologically manipulated to obey their masters, as their double vaccine dose, now requires a booster after six months, and will require annual boosters for eternity. They will unquestioningly submit, without ever using their critical thinking skills to grasp these are not real vaccines and do not work. I will not give in to their mass psychosis.

Since I was relating the song to the Big Pharma drug induced mass shootings, my 2012 article gravitated towards Huxley’s view of totalitarianism, as he believed our overlords would use pharmaceuticals, conditioning, and mind control to achieve their evil means.

“A really efficient totalitarian state would be one in which the all-powerful executive of political bosses and their army of managers control a population of slaves who do not have to be coerced, because they love their servitude.” – Aldous Huxley – Brave New World

“And always, everywhere, there would be the yelling or quietly authoritative hypnotists; and in the train of the ruling suggestion givers, always everywhere, the tribes of buffoons and hucksters, the professional liars, the purveyors of entertaining irrelevances. Conditioned from the cradle, unceasingly distracted, mesmerized systematically, their uniformed victims would go on obediently marching and countermarching, go on, always and everywhere, killing and dying with the perfect docility of trained poodles.” –  Aldous Huxley

My dire view of our future was just as grim nine years ago as it is today. My belief was the alienation and isolation created by our sprawling, automobile dependent, technology obsessed, government controlled, debt financed society had spread like a cancerous tumor, slowly killing our country. As with most of my early articles I gravitated towards our dire fiscal situation and how it was surely unsustainable. My example was:

Since 1979, Total Credit Market Debt in the United States has risen from $4.3 trillion to $55.3 trillion, a 1,286% increase in 33 years.

It had gone up $51 trillion in 33 years. Well guess what? It now stands at $85 trillion, up another $30 trillion in 9 years, with no deceleration in sight. Since I wrote that 2012 article, the national debt went from $16 trillion to $29 trillion (up 81%), GDP went from $16 trillion to $23 trillion (up 44%), the Dow went from 13,000 to 36,000 (up 177%), and consumer debt went from $2.9 trillion to $4.4 trillion (up 52%).

As usual, the plebs went further into debt, while their overlords saw their trillions in stock holdings almost triple in nine years. I thought the debt growth was unsustainable, but the Fed said hold my beer. Their debt creation orgy accelerates by the minute, with real inflation (as opposed to the fake BLS bullshit) running in excess of 10% hitting average Americans, while the Wall Street oligarchs get richer by the second. Even using the BLS bullshit inflation figures, the USD has lost 17% of its purchasing power since 2012, again screwing the little guy.

The USD has lost 96.4% of its purchasing power since the creation of the Federal Reserve in 1913. So much for meeting their “mandate” of stable prices. Do you get it yet? The Fed’s job is to enrich their owners (bankers & billionaire oligarchs) while enslaving you in debt and making sure your meager wages buy less and less each year. This is where the “You Will Own Nothing and Be Happy” slogan begins to make sense.

The Build Back Better slogan, created by Schwab and his Davos co-conspirators, really refers to building a better wall around the plebs so they remain isolated, alienated and under control. Roger Waters has explained the song Hey You was also an exhortation to make connections with people, help each other, and overcome the alienation and isolation created by those pulling the strings of our societal dystopia.

When I heard the song on the radio the other day, my take on the lyrics is now colored by the last two years of this engineered, weaponized, marketed Covid pandemic. The alienation and isolation have not been a choice of individuals, but a mandate from our authoritarian overlords. The wall is being built by those who want to destroy our existing structural paradigm and replace it with something they consider better, but which will be far worse for liberty and freedom minded individuals.

A more Orwellian dystopia is being ushered in by Soros, Gates, Schwab and their chief lieutenants Biden, Pelosi, Fauci, Powell, along with the other highly paid apparatchiks in government, media, medical industrial complex, and military industrial complex.

We were already in the death throes of the most dysfunctional, decadent, delusional, debt engendered era in the long history of mankind. Their debt saturated “solutions” from 2008 through 2019 reflected an air of desperation. Those in power realized their stranglehold on the narrative was slipping away and were in danger of seeing a sudden decline in their wealth and control over the masses.

Rather than accept their slightly less profitable fate like normal human beings, these psychopaths have doubled down by using a relatively non-serious flu for anyone under 85 years old and not morbidly obese, to try and implement a new world order, where they continue to reap all the benefits and the masses incur the pain, suffering and death. The diabolical aspects of this evil undertaking are almost too outrageous to believe. They have redoubled their propaganda endeavors in order to convince the ignorant masses to willingly love their servitude.

But it was only fantasy
The wall was too high
As you can see
No matter how he tried
He could not break free
And the worms ate into his brain

Pink Floyd – Hey You

In today’s circumstances those lyrics reflect this fantasy/nightmare of Covid being used as the justification to destroy our economic system, drive hundreds of thousands of small businesses into bankruptcy, locking people in their homes for months, mandating useless masks as a dehumanization and fear tactic, mandating the injection of an experimental gene therapy into our bodies as a requirement to make a living, and using a bottomless supply of lies and media propaganda to convince an already dumbed down populace to beg for increased levels of servitude to those who haven’t been right about one thing since this scamdemic was launched.

As others have noted, this hasn’t been a pandemic, it’s been an IQ test. And as a society we’ve scored low enough to be put on the short bus to the school for the slow-witted. The global oligarchs began constructing our wall, but millions of willing collaborator Karens and Todds are gleefully adding bricks to that wall.

I’ve been flabbergasted since the outset of this propagandized and highly marketed fearfest, over a strain of the annual flu, by the lack of critical thinking skills exhibited by average Americans and their inability to understand simple mathematical risk calculations when they are told blatant lies by the likes of Fauci, Walensky and a plethora of Big Pharma bribed “medical experts” paraded on the boob tube every day. They have let feelings, emotions, and false narratives guide their actions, rather than facts, data, and scientific proof.

Everyone has the freedom to verify what they are being told and calculate for themselves the 99.7% overall survival rate and 99.999995% survival rate for those under 25 years old. But they have been psychologically compelled to not question the State or embrace their Constitutional freedom to dissent and not comply. They unquestioningly inject their children with these drugs when unequivocal evidence shows a much higher risk from the jab than from Covid. Huxley realized decades ago a weak-minded populace could be easily manipulated. We have now reached peak complicity, compliance and cowering to the national State and those pulling the strings of our government.

“This concern with the basic condition of freedom — the absence of physical constraint — is unquestionably necessary but is not all that is necessary. It is perfectly possible for a man to be out of prison and yet not free — to be under no physical constraint and yet to be a psychological captive, compelled to think, feel and act as the representatives of the national State, or of some private interest within the nation, want him to think, feel and act.” –  Aldous Huxley

Huxley was not a big fan of technological “progress” as he just saw it as a more efficient means of going backwards. Those who believe technology is the answer to all of our problems are either insanely myopic or profiting from this fallacy. Technology has certainly contributed to allowing corporations to generate profits through efficiencies, marketing, logistics, and replacing human beings with computers and robots.

Technology has also made it very efficient for the State to utilize propaganda, fear, and social indoctrination through electronic media to control the population and manipulate the narrative to suit their diabolic purposes. For the few who dissent from their commands, technology is used to sensor, de-platform, restrain, monitor, and destroy their lives, if necessary.

Modern technology has a dual purpose, as an entertainment aphrodisiac, and an electronic boot stomping on your face forever. They want you distracted, amused, and consumed by trivialities, while they execute their wealth pillaging scheme and slowly build a technological wall which grows ever higher and impossible to escape. Consumption, diversion, and obedience is all they asked.

Societal stability, in the eyes of the sociopath unseen rulers behind the curtain, is based upon state designed happiness, social indoctrination disguised as public education, endless war, fear-based propaganda, and the use of pharmaceuticals to alleviate dissent and wrong thinking. Normalcy, traditional families, community standards, hard work, thrift, self-responsibility, neighborly connections, faith, and self-governing are all antithetical to the societal breakdown required to implement the Great Reset. Therefore, these values are banned in the world we inhabit today.

The best laid plans of the ruling class began to go awry in late 2019, as the gears of the financial system began to grind and fracture. The never-ending Trump coup was floundering under the weight of lies. Their wealth, power, and control were going to take a major hit. So, they decided to pull it. They had laid the groundwork for decades, creating generations trained to value material possessions, require instant gratification, shun critical thinking, let feelings guide their actions, believe debt acquired possessions constituted wealth, trust politicians are working in their best interests, and do whatever those deemed “experts” by the corporate media tell them to do.

They have created tens of millions of mentally ill sheep who only appear normal because they fit in to this profoundly abnormal society, where they forfeited the thinking and decision making for their lives to people like Gates, Soros, Biden, Fauci and Zuckerberg, who despise them. Because of their government created neurosis and cowardly compliance, we are all victims, and the wall we must scale to escape gets higher by the day.

“The real hopeless victims of mental illness are to be found among those who appear to be most normal. Many of them are normal because they are so well adjusted to our mode of existence, because their human voice has been silenced so early in their lives that they do not even struggle or suffer or develop symptoms as the neurotic does. They are normal not in what may be called the absolute sense of the word; they are normal only in relation to a profoundly abnormal society. Their perfect adjustment to that abnormal society is a measure of their mental sickness. These millions of abnormally normal people, living without fuss in a society to which, if they were fully human beings, they ought not to be adjusted.” –  Aldous Huxley

The walls erected within Roger Waters’ lyrics were figurative, referring to the isolation and alienation from society chosen by an individual (himself). My interpretation, based on what myself and many others are experiencing today, is more literal, with the isolation and alienation being created by government and their mentally ill, willfully ignorant advocates of lockdowns, masking, jabs, mandates, passports, quarantine camps, and coercion to command compliance.

This entire pandemic scheme has been designed as a divide and conquer undertaking, with the purpose of implementing their Great Reset plan to own everything while the plebs own nothing and happily do as they are told. For those of us not willing to go along with their plan, they have alternate arrangements in store. We are in the midst of this struggle for the future of our country and the world.

The Party has told you to reject unequivocal facts during this entire engineered psychological operation. They convinced the vast majority of the population to be terrorized by a virus with a 99.7% survival rate that only kills the very old and the very obese. They said it didn’t come from the Wuhan lab and wasn’t funded by Fauci. They convinced the masses masks worked when they knew they didn’t.

They said a fifteen-day lockdown would slow the spread and end the pandemic. They said their vaccines would immunize you from catching Covid before they changed the definition of vaccines and told you it was always supposed to just reduce the symptoms. They have convinced a couple hundred million people to participate in an experiment as guinea pigs for an unproven untested gene therapy.

They continue to proclaim vaccines work, even though they don’t, and of course get your booster, also because they don’t work. They refuse to acknowledge natural immunity to be far more effective and long-lasting than their jabs. No money to be made from natural immunity. They have censored and de-platformed anyone who showed proof ivermectin and hydroxychloroquine worked better than the vaccines.

No money in subscribing either safe and effective treatment. They deny the vaccines have caused millions of adverse reactions and tens of thousands of deaths. They have instructed you to reject all of this evidence of their deceit and demonic designs to abscond with your wealth, freedoms, and liberties.

As we enter Biden’s dark winter, you can sense the desperation of the Party/Deep State/Oligarchy as they employ more coercive and destructive tactics to force the non-compliant to obey and do as they are told. They are attempting to isolate and alienate those who refuse to submit to their clearly unlawful vaccine mandates by excluding them from society and threatening their livelihoods.

The threats and intimidation have succeeded with a significant portion of the holdouts, but tens of millions are refusing to bend the knee. Many feel alone in their resistance to these totalitarian measures, as those in control of the narrative have painted a picture of only a small minority of conspiracy theorists rejecting their Great Reset authoritarian blueprint. The wall seems too high for many.

The truth be told, their blueprint is growing stale, as they desperately attempt to strike fear into the masses with their latest variant of the month. The truth is they fear our opposition. They fear we will inspire more people to resist. They fear we will band together. They fear the truth, which is the backbone for our resistance. They fear we are heavily armed. They fear us realizing we are actually the majority. They fear they are starting to lose.

Their fear of our escalating power is leading them to make increasingly reckless and drastic pronouncements and demands. The push back to their directives is gaining in intensity. They believe they can make the wall high enough to deter those who could foil their Great Reset scheme. The odds are in their favor because they control the politicians, media, corporations, and the minds of the indoctrinated sheep, but don’t tell me there’s no hope at all. We have truth, the Constitution, the 2nd Amendment, and millions of liberty-minded truculent partisans who will not bend to their will. We have no choice but to fight, using any means at our disposal. We realize we must stand together, because divided we will fall.

Hey you, out there on the road

Always doing what you’re told

Can you help me?

Hey you, out there beyond the wall

Breaking bottles in the hall

Can you help me?

Hey you, don’t tell me there’s no hope at all

Together we stand, divided we fall

Pink Floyd – Hey You

*  *  *

The corrupt establishment will do anything to suppress sites like the Burning Platform from revealing the truth. The corporate media does this by demonetizing sites like mine by blackballing the site from advertising revenue. If you get value from this site, please keep it running with a donation.

Tyler Durden
Sun, 11/28/2021 – 23:30


Author: Tyler Durden

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Economics

Weekly Market Pulse: This Again??!!

Here we go again. Or maybe, more accurately here we go still. COVID has reared its ugly head again, this time in the form of a new variant called Omicron….

Here we go again. Or maybe, more accurately here we go still. COVID has reared its ugly head again, this time in the form of a new variant called Omicron. The name surprised some folks because the next letter in the Greek alphabet was Nu but the WHO thought that sounded too much like “new” so they skipped that one as Greek speakers are generally confined to Greece these days. And the next letter was “Xi” which the WHO said was a common last name and that their policy required “avoiding causing offense to any cultural, social, national, regional, professional, or ethnic groups.” Well, goodness no, wouldn’t want to offend anyone, certainly not the most famous man with the last name of Xi. What I’m trying to figure out is if I actually slept through epsilon, zeta, eta, iota, kappa, lambda and mu or if WHO thought those might offend someone too, like maybe some fraternity or sorority. They sure didn’t seem to mind offending Animal House fans by naming the last one Delta. Maybe they were worried about offending nerds (Lamda, Lamda, Lamda). Ah, WHO cares?

About the only thing we know for sure is that last Friday’s selloff didn’t have anything to do with the name because that happened while the WHO was deep into research on the Greek alphabet and who it might offend. We were having a nice pleasant Thanksgiving week, eating turkey and ham and yams, watching football – if that’s what you call what the Lions play – and just generally enjoying a couple of days away from the market when WHAM! Here comes Mu or Nu or Xi or Omega or whatever and the market tanks like it hasn’t done since all the way back in February. Worst week since, um, well, last month. The S&P 500 was down 2.2% last week which, in normal times, would be barely worth a mention. But in today’s speculative market, that qualifies as a correction and Twitter is all atwitter this evening about the rebound everyone expects tomorrow.

We don’t know anything about this new variant yet and so there is no way to judge the impact. Yes, some countries are closing borders but they can be opened just as quickly. I have said since the onset of this pandemic that we better learn how to live with this thing because it isn’t going away. And unless Omicron turns out to be an extremely deadly version of COVID, my guess is that people are just going to go on with their lives; COVID exhaustion has set in. So, whatever the state of the economy was prior to the arrival of the big O, that’s what it is now too no matter the WHO’s permanent state of panic.

The global economy is still recovering from the COVID shock – the shutdowns and the response. The first two quarters of this year were a big rebound as the vaccines were rolled out. Last quarter was a bummer with the emergence of the delta variant (or at least that was the accepted wisdom). And this quarter so far is looking like a pretty good rebound from that slowdown. The Chicago Fed National Activity index rebounded in October to 0.76, a big improvement from -0.18 in September. The 3 month average is now 0.21, showing growth as just a bit above trend. Until the new variant news hit Friday, markets were starting to confirm the improvement in the economy. Both nominal and real rates were up on the week – for a change – and the economic data was almost uniformly positive. But rates were down hard on Friday and finished the week in the red. We’ll see if that lasts this week.

When it comes to economic and market data I try not to react too much to any one report. I learned a long time ago that the first pass on economic data is really just a guess and revisions can change your entire view of the economy. And this week we got reason number bajillion why that is true. Last month we got a report on goods trade that showed a large drop in exports. A lot of pixels were expended in explaining why that was a big warning sign about the global economy. But the drop was confined to one category of goods called “industrial supplies” and I warned that we didn’t know what caused it. Well, since then we discovered that the biggest drop was in “non-monetary gold” which means essentially nothing to the global economy. I don’t know why it dropped that month but it rebounded this month and the entire drop has now been wiped away. There were some other weak items in that category as well – crude oil and petroleum products – but none of it was that surprising or important to the global economy. The point is that one shouldn’t make any rash judgments about the markets or the economy based on one report.

And the same applies to the latest virus news, whatever it might be. The emergence of the Omicron variant could be negative – or not. It may evade the vaccines – or not. It may be deadly – or have mild symptoms with low hospitalization and death rates. We just don’t know. I do believe, based on my own reading about coronaviruses, that COVID-19 will eventually mutate into something our immune systems can handle. It could become like the flu or even better like the common cold (which is actually a bunch of viruses). That is, after all, what coronaviruses do (not all viruses obviously). They evolve and mutate to a form that allows it and its host to survive. How long that takes is anyone’s guess but if history is a guide it doesn’t happen quickly. You could be talking years before we reach that point. In the meantime, we need to do the best we can and live with it. Because it isn’t going away. Still.


 

As I said above, the economic data released last week was almost uniformly positive. New and existing home sales rebounded although both are still down year over year. Durable goods were lower for the second straight month but ex-transportation orders were up a solid 0.5%, the eight consecutive monthly gain. Core capital goods were also higher again, up 0.6% for the sixth consecutive gain.

Personal income and consumption were both up in October as wages and salaries continue to move up. Incomes fell off some after the end of the extended unemployment benefits but that is rapidly fading in the rear view mirror. Consumption remains well above the pre-COVID trend and shows little sign of abating. And by the way, that is true of real, inflation adjusted consumption too. Incomes are still struggling a bit after inflation and taxes are taken into account; real disposable income was down 0.3% last month and 0.9% year over year.

Despite that we continue to classify the current environment as one of falling growth. That is primarily due to real rates which are still near their lows of this cycle at -1.07% for the 10 year TIPS. The nominal 10 year at 1.48% is still quite a bit below the peak last spring of about 1.75%. Lastly, the yield curve continues to flatten although it is still a long way from flat or inverted. The dollar is also still in an uptrend, hitting its highest level since June 2020 last week before pulling back on Friday. While we might see some near term weakness the short term trend is obviously up.

 

We get more housing data this week in the form of pending home sales which will give us a better idea of how the market is right now.

Jobless claims should be interesting this week. Last week’s report dropped under 200k. The last time initial weekly claims were that low the summer of love was just ending (September 1969 for all you youngsters out there). It seems like a possible seasonal adjustment mistake but maybe not. The trend should put this week’s number up around 250k.

We get payrolls this week and that is often a market moving event. It is backward looking and subject to huge revisions but for some reason people still pay attention so we will too, at least for this week.

Finally, we get the ISM reports this week.

Stocks were down across the board last week while bonds were mostly higher (in the chart below is shows the 3-7 Year Treasury index as down for the week but that is wrong for some reason; the ETF for the index was up on the week.) Corporate bonds, high grade and junk, were down last week as spreads have widened every so slightly. Junk spreads are still very tight historically so just something to keep an eye on at this point.

Commodities also took a beating last week as crude oil dropped below $70. Blame it on omicron I guess but it was due for a pullback in any case. The commodity line below is the GSCI index which we sold months ago. Our preferred index right now is the BCOM which was down about half as much as the GSCI last week. In any case, commodities are still the best performing asset of the ones we track and own in our portfolios.

In a strong dollar year it isn’t surprising to see foreign markets lagging. Global ex-US stocks are up just about 5% this year while EM, Asia ex-Japan and China are all down YTD. Japan is clinging to a small gain. It is hard to fathom the gap in performance between US and international markets over the last decade. Just truly stunning and the reversal, when it comes, will likely be just as spectacular. But we aren’t there yet.

Value outperformed last week but it wasn’t anything to write home about.

With everyone expecting the market to rebound tomorrow I wouldn’t be surprised at all to see us take another leg down. A lot of Friday may have been nothing more than a convenient excuse to take profits in a wildly overvalued market. A 2% down day hasn’t changed that. About the only thing that would is a certified bear market but with the economy at least okay for now, that doesn’t seem likely. So, what do we do to our portfolios? Nothing is the usually the best answer to that and this is no exception. Our portfolios continue to be defensive with a larger than normal allocation to cash. That’s what the current environment of falling growth and rising dollar calls for. Maybe omicron will be the catalyst for the long overdue correction of at least 10%. With margin debt as high as it is, it probably wouldn’t take much more to really accelerate the selling, forced or otherwise. And 10% is nothing, a normal market fluctuation that comes, on average, about every 19 months. This is the 20th month since the bottom of the COVID bear. Just sayin’.

Joe Calhoun









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Economics

Dow Jones, the S&P 500, and Nasdaq Price Forecast After Black Friday Sell-Off

Wall Street’s three main indexes ended sharply lower on Friday as news of a new COVID variant worried investors around the world…

Wall Street’s three main indexes ended sharply lower on Friday as news of a new COVID variant worried investors around the world.

The World Health Organization (WHO) on Friday designated a new COVID-19 variant detected in South Africa, and a lot of people didn’t want to hold risk assets on Monday morning or are afraid of what that could look like Monday morning.

Markets are reacting negatively because it is unknown at this point to what degree the vaccines will be effective against the new strain and would it initiate new lockdowns around the world. David Kotok, chairman and chief investment officer at Cumberland Advisors, added:

All policy issues, meaning monetary policy, business trajectories, GDP growth estimates, leisure, and hospitality recovery, the list goes on, are on hold. The new strain may complicate the outlook for how aggressively the Federal Reserve normalizes monetary policy to fight inflation.

The new Omicron coronavirus is detected in Britain, Italy, Netherlands, Germany, Israel, Belgium, Botswana, Denmark, Hong Kong, and Australia for now.

Britain has already imposed travel restrictions on southern Africa, while the European Commission is considering suspending travel from countries where the new variant has been identified.

The upcoming week will be busy, and investors will pay attention to Fed Chair Jerome Powell and U.S. Treasury Secretary Janet Yellen’s appearance before Congress to discuss the government’s COVID response on November 30.

S&P 500 down -2.3% on Friday

 S&P 500 (SPX ) weakened by -2.3% on Friday and closed the week at 4,594 points.

Data source: tradingview.com

If the price falls below 4,500 points, it would be a strong “sell” signal, and we have the open way to 4,300 or even 4,200 points.

The upside potential remains limited for the week ahead, but if the price jumps above 4,650 points, the next target could be around 4,700 points.

DJIA down -2.5% on Friday

The Dow Jones Industrial Average (DJIA) weakened -2.5% on Friday and closed the week below 35,000 points.

Data source: tradingview.com

The Dow Jones Industrial Average remains under pressure as news of a new COVID variant worried investors worldwide.

The current support level stands at 34,500 points, and if the price falls below this level, the next target could be around 34,000 points.

Nasdaq Composite down -2.2% on Friday

Nasdaq Composite (COMP) has lost -2.2% on Friday and closed the week at 15,491 points.

Data source: tradingview.com

The strong support level stands at 15,000 points, and if the price falls below this level, it could be a sign of a much larger drop.

Summary

Wall Street’s three main indexes ended sharply lower on Friday after the news that the World Health Organization designated a new COVID-19 variant detected in South Africa. All policy issues go on hold currently, and investors will pay attention to the government’s COVID response on November 30.

The post Dow Jones, the S&P 500, and Nasdaq price forecast after sell-off on Friday appeared first on Invezz.

Author: Stanko Iliev

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