Retracements are one of the most interesting features of stock market performance. You will see a big decline (like from Sept. 2) when people come to their senses. Then you get often-times manic, insane rallies – like the one we have been in this week.
It’s the stuff of Elliott Wave 2 bounces – sometimes.
If that’s what we’re now in, the rally should come to an end shortly, but in the meantime, a lot of “bear meat” is being served to the Bull Run. Where can we go next?
That yellow circled are in the middle is what leads us to think the run could be in the late-mature phase now. But, like the old Greenspan saying went (going from memory here): “Markets can remain irrational longer than most people can remain solvent.” Or, words to that effect.
Based on market action, we wouldn’t be surprised in the H.6 money stocks confessional after the close today, to see the money supply jumping.
The Facts Showing Up?
Not that facts matter much to people. Especially in Irrational Markets. Still, the new Challenger Job Cuts report is sobering: Up 186% compared with September of last year:
“Job cuts announced by U.S.-based employers jumped to 118,804 in September, up 2.6% from August’s total of 115,762, according to a monthly report released Thursday by global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc. September’s total is 186% higher than the 41,557 job cuts announced in September 2019.
Last month’s job cuts bring the yearly total so far to 2,082,262, up 348% from the 464,869 cuts at this time last year. The current year-to-date total already surpasses the record highest annual total – 1,956,876 cuts announced in 2001 – by 125,386 cuts. Challenger began tracking job cut announcements in January 1993.
“We are setting new records for job cuts even though things have improved since the earliest days of the pandemic,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc. “These are uncertain times for everyone, as many states are experiencing an uptick in the number of COVID-19 cases. It is clear we still have a long way to go before many industries can return to normal.”
The Weekly Jobs Data
Also just out from the Labor Department is the weekly claims filings and change to unemployment rates: (something to hang the hopium on…)
“In the week ending September 26, the advance figure for seasonally adjusted initial claims was 837,000, a decrease of 36,000 from the previous week’s revised level. The previous week’s level was revised up by 3,000 from 870,000 to 873,000. The 4-week moving average was 867,250, a decrease of 11,750 from the previous week’s revised average. The previous week’s average was revised up by 750 from 878,250 to 879,000.
I think one of the reasons the market is still (stupidly) pressing on toward a possible 1.618 Fibonacci bounce is that the ADP number was good Wednesday, and the horrible debate (The American Train Wreck, Moderated) allows everyone to claim victory. Not realizing we’re all losers in this.
As if the Drool Day debate wasn’t enough of a joke, we have this morning’s personal income report from the Labor Commissariat. Says – in a remarkable moment of clarity – that personal incomes are going south…
“Personal income decreased $543.5 billion (2.7 percent) in August according to estimates released today by the Bureau of Economic Analysis (tables 3 and 5). Disposable personal income (DPI) decreased $570.9 billion (3.2 percent) and personal consumption expenditures (PCE) increased $141.1 billion (1.0 percent).
Real DPI decreased 3.5 percent in August and Real PCE increased 0.7 percent (tables 5 and 7). The PCE price index increased 0.3 percent. Excluding food and energy, the PCE price index increased 0.3 percent..
A person able to pass a drug test might wonder “How can markets rise when crap like this is hitting the fan – jobs falling and dueling idiots for the WH?” Well, yeah: The Data IS running sucko, Bucko:
Hell if we know why crack-driven markets would go up……just toke it up... and laugh along with us.
Speaking comic relief: Here goes the Washington Post again with more apologist crap for the DC-Do-Nothings in The Finance 202: Economic relief talks face do-or-die moment…
There’s no excuse for all this fiddle-farting around (Nasty and Shifty aside). It’s just the House would rather punish the victims (we tax chattel) rather than allow funds to hit prior to the Electile Dysfunction. Re-dicking-fuculous.
We have been mentioning the increasing odds of West Coast earthquake action increasing for almost a year, now. Reason? There was some very good research done a while back (several years) that linked the long-term bottom in Sun cycles with changes in the seismic activity levels. Not unexpected: Things big bigger when hot, smaller when cold, generally. Nothing new there.
But, while we have been waiting to see if the Golden State falls in the ocean,; cast your eyes now on the overnight quake picture out west: Swarm of more than 80 small earthquakes rattle Southern California; no damage or injuries reported.
No, this is not to say we expect this to result in SoCal becoming a big-ass island any time soon. BUT, we have sailed the Strait of Juan de Fuca and the Haro Straight up into B.C. often enough to realize that little “island forming” incidents (that caused Vancouver Island, for example) are not unheard of around the eastern Pacific Rim.
Trust you also remember that the elevation of the Salton Sea south of Palm Springs is -226.4 feet, right? Deep water port in waiting – just need the seismic ditch-digger to come along.
OK, What Really Matters?
You mean besides a kill-switch called the STFU-Button for “debates”? Well…
DEMANDS for do-overs are incredibly popular these days. So we notice stories like how an “Ohio killer alleging racism-tainted jury seeks new trial.”
Also in Courthouse buzz today we see where Court OK’s $800M settlement from MGM Resorts to 2017 Las Vegas Strip shooting victims. Pencils out to about $181,000 each for 4,400 claimants…
And last, but not least: Trump signs spending bill to keep the government open until Dec. 11. Well, that’s too bad. We ought to have at least kept funding for congress on hold until they do something right.
Oh…wait! They’d never get paid…(Say, maybe not a bad idea there…hmmm)
Write when you get rich,