Joe’s economy still healthy: GDP expands +2.9%

Hmm ...

 

^^
Exactly

 

Another good market day on the news.
Think the market has gotten out over its skis a bit, this was actually a trap I posted about a while back. Lowering inflation was going to give the markets a false sense of security when the underlying cause could be a slowing economy, which will hurt stocks short term when it comes to pass. And the more we tick up the bigger that fall will be.

 

All the more reason to keep raising rates.

 

China really reopening is also a factor.
They will increase demand for energy which will raise the global prices and be a factor with inflation.

Unlikely the Ukraine situation changes much.

Those two issues will have the biggest effects.
There are many jobs still open and tech is layoff but will those people go get get tech jobs or be forced into lower wage jobs?

Also people who have had student loans on hold will need to start paying them again. I’m sure many didn’t stop(if they were smart).

Lots of variables to contend with in the coming months

 

The falling is over. We’ll do a lot of starts and stops but history suggests a 10-15% market return o; the back of 22’. I do think the nazzy is a little rich as it’s jumped on the prospects of a stop in rate hikes. It’s not likely we get an actual cut until 2024. A soft landing is the most likely outcome at this point.

 

Agreed. Gonna be a great buying oppt here soon between recession and debt ceiling clownery.

 

We will see. Here’s an article that talks about the almost record dispersion in predictions among experts. The numbers used in this article show we are already above the average final price for the year. The median from Moody’s says we are less than 2 percent from the number already. But there are definitely bullish predictions there too.
2023 Wall Street Forecasts For The S&P 500: Huge Dispersion

The issue is that we are in completely uncharted waters given the pandemic, the great resignation, savings rates, inflation, the almost record interest rate rise, government spending where it was etc.
I would day my opinion is just that, anyone who is right will be lucky more than prescient, when even the people who get paid big money to know have wildly different opinions.

 

FYI
Falling Mortgage Rates Bring Some Home Buyers Back to Market
Jerome Powell may actually be achieving a "soft landing" i.e. disinflation with no recession.

 

January Jobs Report: Pace of U.S. Hiring Expected to Slow Again

 

Stock futures sink after shockingly strong jobs report

 

What a country!

 

I mean - it's easy to roll our eyes at the fed pounding us for this good news, but it's not all good news.

It's obviously great that theres such a demand for labor and it's great news for those 517K people and their families, but setting aside the inflationary impact of continued wage increase - it's clear we have a labor problem.

 

And there is a solution. It's increasing legal immigration. Unfortunately nativism including limiting immigration has become a core value of one of the two major political parties.
This was from 2020.
Trump Cuts Legal Immigrants By Half And He’s Not Done Yet

 

It’s a good one to have. Labor participation was also up along with the blowout #. The initial market reaction was a sharp sell off but we’ve reversed all that in spite of weak reports from big tech last night. The market likes the macro story being set up for 2023.

 

That number will get rounded down.
But if I had to guess on “why the surge”…
It’s hiring managers assuming al their open positions are going to be pulled as a cost cutting measure and racing to fill them before they do.

 

I think the markets will calm down about this because the wage growth slowed a bit despite the massive amount of new jobs added. So the Fed really has no path to argue that this is a sign of massive inflation because people's wages didn't go up at a fast rate, just a lot more of them are working than previously were.