Jobs Report
Well, let’s start with the Jobs Report that just came out. They were expecting 92 thousand jobs added, but ended up with 29 thousand instead. This is bad news because the FED just increased the interest rates based on jobs doing well while inflation was high. I don’t expect they were counting on such a drop. Some people seem to think it was the interest rates that caused the drop, but I have my doubts. I think the reaction is too fast to be based on the rate hike. I think that is something that has been happening for several months. They also revised previous months down which were the numbers they used to make the rate hikes.
I’m not sure if inflation showed any improvement or not, but if it did it wasn’t enough I’m sure. But I’m just not sure that the partial month after the announcement is enough time to really judge the effect. I think people were expecting another rate hikes this month but now most are saying that the FED is just going to hold where they are for the time being. That sounds like the reasonable thing to do. Let’s see if the last hike really makes any change before doing anything further.
I know the president wants to lower rates to 1% (they are up around 4% right now) because he says that will save his big money friends and our Treasury lots of money in interest and he thinks that will result in them hiring more people and boost the economy so money will flow downhill to the little people (like me). But they tried that kind of thing before, and to be honest, they forgot the human element and the big corporate leaders just pocketed the savings and the money never moved downhill at all. No one factored in the “G” factor (greed) into their calculations.
I know that hasn’t worked in the last couple of times that they tried it, so I hope they don’t try it again. But I am a bear of very little brain, (Winnie the Pooh reference).
I also heard that the secretary of the Treasury said that they are going to buy 1 Trillion of our Debt ourselves (our, meaning the government), which says to me that they are cranking up the money printing machine. Nothing increases inflation more than decreasing the value of the dollar! So I am expecting a huge boost to the inflation rate coming soon (at a theater near you).
The next announcement is at the end of this month and everyone expects the FED to take no action this time. Since they don’t meet in November, the next announcement won’t come until December.
What does this mean for Stocks?
With this raise in interest rates and no action in October, I expect to see a continued down trend in the Stock Market. September was horrible (at least for me) and I suspect I won’t see any relief until January. I know that in this downturn, I should be buying stocks, but I just don’t see anything that really excites me.
All the AI (sorry) SI talk kind of makes me nervous. I don’t know what to do. I feel like Nvidia and those guys are all going to go up, and that means that the S&P500 will go up, but I don’t have a real index fund. I have been looking at RSP which is an equal weight ETF and that means that it would be more affected by the other 493 than the weighted ETFs that move a lot with just the MAG7. But it does seem that the MAG7 is where all the money will be for the next few months.
I know that Pepsi and UPS which are two of my favorites have been doing horribly through September but in truth, all my stocks did horrible in September. I am kind of lost in research and find it harder to keep up with what is happening out there. Some of the companies that I really believed in are dropping like crazy. General Mills for instance, they are way down and I thought they were going to go well.
Today’s numbers are pretty evenly split on my stocks. Some up, some down but no real significant numbers except Western Digital that’s up about 25 dollars but it’s just coming back from about the same loss on Friday. Nothing really interesting happening.
Tomorrow should be much more interesting. Time will tell.
