The bias is to the downside, which is fine. In fact, volatility is slightly ahead of the norm, but even so, triple-digit moves still unnerve people. Nevertheless, there was not a lot of panic in the market, but there was enough to trip sell programs that did not need a lot of assistance to begin with. Absent were the buyers who have the benefit of waiting it out to get a read on the Fed and on earnings, which will soon be in full swing.
The key support number is last Thursday’s low of 16,680 followed by 16,530:
Earnings season has begun with a whimper from a couple of companies that are without a clue. Yum Brands, a perennial knucklehead, and The Container Store, boasts about a business model that puts shareholders last! Profit-seeking businesses, including those that have fought for survival, along with Alcoa will be a topic of discussion on my show.
This year, the biggest challenge of the bull market is long overdue. It is the part of investing that will shakeout investors that are late to the party or the investors that have improperly balanced portfolios. The good news is that hedge funds are sucking wind, and they have one last chance to get this right… they had better be buyers. I am looking for the right signal, and I am not afraid, just a little disheartened by White House’s ineptitude at new heights.
A Hot Christmas in the Wage-Less Recovery?
The economy and jobs should go hand and hand. Yet, the sluggish jobs recovery does not seem to be stopping economist and businesses from predicting a huge Christmas season for retailers. The thing is, wages are flat and most jobs created are only part-time. Full- time employment has a long way to go before returning to its peak. It is down 2.6 million from its peak, making this even more alarming because the working age population has increased by 15.5 million. Three million permanently unemployed and part-time workers are feeling the squeeze more and more from ObamaCare. In fact, Wal-Mart is feeling the squeeze as well. Recently, Wal-Mart announced it would drop insurance for 30,000 part- time workers, as cost have already eclipsed $500 million; the company budgeted for $330 million.
Yesterday, the National Retail Federation issued guidance for this holiday shopping season and it is huge. Sales are expected to be higher by 4.1%, well above the ten-year average of 2.9%, up to $616 billion and should create 800,000 jobs.
Where Are the Skills?
Of course, retail jobs for the holiday season are easier to fill than some of the other jobs evolving these days. The JOLTs report on job openings and labor turnover is at a 13- year high, but quits held steady. This is not a great sign of confidence among workers.
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