199,000 NEW JOBS: The U.S. economy added another 199,000 net new jobs in December, lower than expected. The unemployment rate now stands at 3.9% (4.2% last month). Half these jobs were in leisure and hospitality which is now back to 85% of pre-pandemic levels. State and local education shed another 10,000 jobs. The Labor Force Participation Rate did not change, holding steady at 61.9%. Despite December’s slowdown, the average monthly job gain in 2021 was 537,000.
(Source: bls.gov/news.release/empsit.nr0.htm) |
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| STOCKS STUMBLE OUT OF THE GATE: After starting the week by moving up, stocks came under pressure after release of minutes from the meeting of the Federal Reserve made it clear that the Fed intends to pull back on stimulus and raise interest rates sooner and faster than previously planned because of inflation. On Friday, the disappointing jobs report put a coda on the week and stocks came down a bit more. |
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APARTMENT DEMAND AT RECORD HIGHS: Strong demand for apartments has driven the occupancy rate up to 97.5%, the highest rate in at least the last thirty years. Due to the high demand and limited availability, rents have soared, up 14.4% in 2021. Fortunately, average incomes for renters has increased significantly as well (up 11% since pre-pandemic). The amount of units being rented increased by 673,000 in 2021, and a total of 360,000 new units were completed in the year. Another 682,000 are under construction with over 400,000 expected to be completed in 2022.
(Source: realpage.com/analytics/demand-apartments-2021-smashes-previous-record-high/) |
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RATE OF GROWTH OF SERVICES SECTOR SLOWS: The Institute for Supply Management keeps an index on the services sector of the U.S. economy. If the index is above 50, it indicates that the sector is growing. In November, this index registered at 69.1%, an all-time high. In December, this index registered at 62.0%, showing continued robust growth, but at a slowing rate. This was the 19th month in a row of growth.
(Source: ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/) |
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| INFLATION IN EUROPE: The European Union’s consumer prices in December were 5% higher than a year before, a rise from 4.9% in November. Christine Lagarde, President of the European Central Bank, said it is unlikely that it will raise interest rates this year. |
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| CONTINUING TO WATCH THE DATA: U.S. deaths were back up late in the week, continuing a pattern since early November where it has bumped up and down a bit, but stayed in a fairly tight range (other than the holiday anomalies). Global deaths continue its pattern of persistent decrease since August 26. In South Africa, infections are down 65% from the recent peak, a quick up and down which seems to be a common pattern with omicron outbreaks. It does seem to have had an effect on the death rate, though, as it has increased from in the 20s per day to in the 80s. (Sources: worldometers.info/coronavirus) |
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| HOSPITALIZATIONS AND GLOBAL INFECTIONS: The number of people in U.S. hospitals who are COVID positive has jumped, up 41%. Reported infections increased in the U.S. by 32%. Global infections increased by 42%. This past week, the head of the U.S. CDC, Dr. Rochelle Walensky, stated that prior outbreaks of COVID infections have been waves, but the omicron outbreak will likely be more like an “ice pick” with a dramatic rise and fall in cases similar to South Africa and other nations that got omicron before us. “I do think in places that we are seeing this really steep incline, that we may well see also a precipitous decline,” Welensky said during her briefing. (Sources: nbcnews.com/health/health-news/omicron-cases-fall-just-quickly-rose-cdc-says-rcna11356 AND covid.cdc.gov/covid-data-tracker AND worldometers.info/coronavirus). |
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COVID CONTINUES TO DISCRIMINATE BY AGE: According to the CDC, COVID continues to be a virus that discriminates against the older. For the last full week of verified data (November 27, 2021), the weekly deaths of people by COVID or with COVID who are 75 or older is 9.39 per 100,000. For those young people between 65 and 74, the number drops more than half to 3.98 per 100,000. For people 50-64, it drops by more than half again to 1.76 per 100,000. For 40-49 it is 0.75 and for 30-39 it is 0.27. For the college aged and slightly older, 18-29, it is 0.09 per 100,000. For 12 to 17-year-olds, not one reported death, so 0.00 per 100,000. For 5-11 it is 0.01 per 100,000 and for 0-4 it is 0.03 per 100,000.
(Source: https://covid.cdc.gov/covid-data-tracker/#demographicsovertime) |
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| MEET MORE PEOPLE: I was reading one young financial planner’s blog last week, and he related a story where he surveyed a bunch of young alumni from his college. When he asked what they regret most about their college experience, he said everyone said the same thing, “I wish I had met more people.” Then the writer admitted the same thing, that he wished he had met more people, joined more activities, been in more clubs, etc. I submit that this is something we should all consider going forward even if we are not in college. To some degree or another, our relationship-building has been interrupted for two years, and we are all feeling a bit of a void as a result. As the fog lifts from this pandemic, however that happens, whether excruciatingly gradual or quick and wonderful, meet more people. |
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| HE’S HERE!!!: This week, my son and colleague Logan, experienced the happy event of his wife having a baby boy! Silas Robert MacGray entered this world 16 minutes after his parents arrived at the hospital. He’s a pretty healthy looking kid, and we are overjoyed with his arrival. |
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Our mission is to help you see the objective, find the path, and navigate past the obstacles to a more prosperous future.
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Douglas R. MacGray, J.D., C.F.P. ®
President
Stonecrop Wealth Advisors, LLC
225 Wilmington-West Chester Pike; Suite 200
Chadds Ford, PA 19317
Direct | Cell | Fax
(610) 628 4545
dmacgray@stonecropadvisors.com |
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| “I’ve learned that I must find positive outlets for anger or it will destroy me. There is a certain anger: it reaches such intensity that to express it fully would require homicidal rage–self destructive, destroy-the-world rage–and its flame burns because the world is so unjust. I have to try to find a way to channel that anger to the positive, and the highest positive is forgiveness.” Sidney Poitier
“Be kind and compassionate to one another, forgiving each other.” Ephesians 5:32 |
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SOURCES:
INFLATION IN EUROPE: wsj.com/articles/eurozone-inflation-hits-new-record-further-pressuring-ecb-11641554526
MEET MORE PEOPLE: ofdollarsanddata.com/the-most-important-decision-in-life/ |
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| (c) 2022 Douglas R. MacGray, All Rights Reserved |
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*S&P 500: This is a measure of the performance of the 500 largest companies in the United States, and it a common index to track the performance of U.S. equity markets, especially the large cap markets.
*MSCI All Country World Index X US: This is a broad measure of the performance of worldwide equity markets excluding the United States.
*Bloomberg Barclays U.S. Aggregate: This is a measure of the U.S. bond markets. |
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