The commencement of the Federal Reserve’s blackout period is underway. The Federal Open Mouth Committee is set to maintain radio silence until after the forthcoming FOMC meeting on December 12-13. The economic indicators slated for this week are poised to sway their sentiment, providing assurance that the robust labor market is undergoing a desired cooling without veering into recession territory. Furthermore, the week’s inflation metrics are anticipated to affirm a moderation trend, aligning with their expectations of economic stability. Consequently, the likelihood of the committee maintaining a status quo for the third consecutive meeting is high, prompting contemplation of a well-deserved break for the rest of the month. The financial markets, both stocks, and bonds, have already factored in our envisioned “immaculate disinflation” scenario during the preceding month, with expectations of continued Santa Claus rallies throughout December.

On the employment horizon, the week commences with the release of October’s JOLTS report on Tuesday. Indications from comparable sources suggest that job openings persisted at a high level, hovering around 9.5 million.

As we approach Friday, the spotlight shifts to November’s employment report, expected to unveil a robust gain of approximately 180,000 jobs, notably driven by the return of autoworkers following their recent strike. Despite this positive outlook, signals from continuing unemployment claims and the jobs-hard-to-get series point towards a potential uptick in the unemployment rate for November. Wage inflation, on the other hand, is likely to sustain its moderating trend during the same period.

Wednesday brings the revised report on Q3 productivity and labor costs, which has the potential to influence stock and bond prices similarly to the preliminary report from the previous month. The initial findings indicated a notable uptick in productivity at 4.7% (saar), accompanied by a 0.8% decline in unit labor costs (ULC). Expectations are that the revision may see an upward adjustment in productivity and a corresponding downward revision in ULC, given the upward revision of real GDP for Q3. The year-over-year ULC, a determinant of underlying inflation, stood at a modest 1.9% during Q3 and could see a downward revision.

During the recent New York Times DealBook Summit, Jamie Dimon, the CEO of JPMorgan Chase, voiced concerns about the economic landscape, issuing a cautionary perspective on the ongoing fight against inflation.

Dimon emphasized the unparalleled scale of government deficits and debt, suggesting that these financial challenges could persist in the foreseeable future. He pointed to essential investments required for expanding the green economy and Europe’s need to address its energy requirements as potential contributors to sustained deficits.

Additionally, Dimon underscored two significant factors potentially fueling inflation: the restructuring of global trade relations and the remilitarization of countries worldwide. According to him, these geopolitical shifts have the potential to introduce both danger and inflation into the economic landscape.

In his warning, Dimon highlighted the possibility of rising interest rates, both in the short term and the 10-year rate, which could, in turn, lead to a recession. This cautionary note aligns with his belief that various global dynamics pose risks that should not be underestimated.

When questioned about the current strength of the economy, Dimon expressed skepticism about its sustainability. He attributed the current surge in corporate profits to robust consumer spending fueled by substantial government support. Dimon cautioned that once this spending diminishes, corporate profits could experience a downturn.

Dimon’s assessment of the U.S. economic situation underscored the extensive fiscal stimulation and quantitative easing as significant contributors. He likened these measures to injecting “drugs” into the economic system, creating a temporary “sugar high.” This metaphor emphasizes the transient nature of the current economic boom, suggesting that it might not be built on sustainable, organic growth.

Why Dimon May Be Wrong:

However, it’s crucial to consider alternative perspectives that challenge Dimon’s cautious outlook. Some economists argue that the robust fiscal measures and investments in critical sectors could indeed foster sustainable growth. They posit that government support has been a necessary stimulus for economic recovery, especially during unprecedented global challenges.

Moreover, proponents of a more optimistic view contend that while risks exist, economic resilience and adaptability could mitigate potential downturns. The ongoing technological advancements, the green economy’s expansion, and the adaptability of corporations in navigating challenges may contribute to a more sustained and resilient economic recovery.

In essence, while Dimon raises valid concerns, the complexity of economic dynamics allows for diverse interpretations. Acknowledging both cautious and optimistic perspectives is essential for a comprehensive understanding of the economic landscape and effective decision-making in uncertain times.

In the vast universe of online advertising, one man has boldly gone where few entrepreneurs have gone before – Elon Musk. Love him or loathe him, there’s no denying that Musk’s approach to advertisers is as unconventional as his plans for a colony on Mars. In this blog post, we’ll explore the amusing saga of Elon Musk and his unique stance on advertisers, all while sharing a few chuckles along the way.

The Elon Musk – Adversary Relationship:

Elon Musk, the man behind Tesla, SpaceX, and a fleet of other futuristic ventures, has always been known for his unorthodox behavior on social media. From tweeting about flamethrowers to contemplating the mysteries of the universe, Musk’s Twitter feed is a digital playground that advertisers both fear and, oddly enough, desire.

Musk’s approach to advertisers can be best described as a love-hate relationship. While he may not be the biggest fan of traditional advertising methods, the allure of a Musk mention on Twitter is like winning the lottery for some advertisers. Musk’s tweets have a tendency to go viral, catapulting brands into the limelight faster than a SpaceX rocket launch.

The Advertiser’s Dilemma:

Advertisers find themselves caught in a cosmic dilemma – should they risk the unpredictable nature of Musk’s Twitterverse, or play it safe with traditional marketing strategies? It’s a question that many marketing teams have pondered as they navigate the uncharted territories of Musk’s social media presence.

Musk, however, seems to revel in his role as the disruptor-in-chief. His disdain for traditional ads has been on full display, with tweets like, “Ads are like a crappy meal you didn’t order,” leaving advertisers scratching their heads and wondering if they should be offended or amused.

A Galactic Battle of Clicks:

In Musk’s universe, the battle for clicks is nothing short of a cosmic clash. While some may argue that his approach to advertisers is a bit too avant-garde, there’s no denying the entertainment value. Musk’s Twitter feed has become a digital spectacle, with advertisers eagerly watching and waiting for the next opportunity to ride the coattails of his online antics.

But is Musk onto something, or is he just trolling the advertising industry for laughs? Only time will tell if his disdain for traditional advertising will lead to a new era of marketing innovation or if it’s simply the manifestation of a billionaire’s eccentric sense of humor.

Conclusion:

In the ever-evolving landscape of online advertising, Elon Musk stands as a polarizing figure, challenging the norms and keeping advertisers on their toes. Whether you find his approach amusing or infuriating, there’s no denying that Musk has injected a dose of unpredictability into the world of marketing.

As advertisers continue to navigate the cosmos of social media, one thing is for certain – the Elon Musk-Adversary relationship is a comedic saga that keeps us clicking, scrolling, and wondering what the eccentric entrepreneur will tweet about next. So, buckle up, fellow netizens, as we embark on this intergalactic journey of clicks, laughs, and the perpetual battle for advertising supremacy in the Muskiverse.

As the news about holiday spending is coming, we achieved a new record! Just this morning, the news reported $5.6 billion on stuff. In the evening the news reported that shoppers spent over $10 billion; 7.5% up compared to 5.4% last year and 3% to 4% expectations.

That’s great. But the question remains: how will Wall Street react to it on Monday? Remember, we are probably still in a “good news is bad news” mentality, and the investors may perceive this spending as bad news, such that the FED may keep rising interest rates because resilient customers may drive inflation up. We have to sit and wait.

Yesterday, I wrote a post with a link expressing that retailers were worried about Americans not spending enough this holiday season. Their reasoning was:
 

1. Dwindling savings
2. Increased credit card debt
3. Stubborn Inflation and high prices everywhere
4. Student loans repayment kick off

They also expressed concerns about shoppers delaying their purchases and ordering less “stuff,” as they saw in October. They predicted that the US holiday sales would rise 3% to 4% compared to 5.4% a year ago and issued “muted annual sales outlook.”
 

Well, as Mr. Scrooge says: “Bah… Humbug!”

Americans were spending like crazy again. And according to MarketWatch (subscription needed), the hottest items were “Disney Little People figurines (seriously?), and Mattel’s Uno Show ‘Em No Mercy card game (no wonder, people are poor and live paycheck to paycheck when wasting money on this, but hey, spend, so we, the investors, make money).

Shoppers spent a record $5.6 billion this season shopping online, up 5.5% compared to last year. See, retailers were worried that shoppers would spend only 3% to 4% from November to December 2023, but they spent 5.5% on Black Friday stuff only!
 

What does this tell us? That all these predictors and forecasters are usually wrong. Take their pessimistic views with a salt of the grain (big one), and invest in established good-standing companies. And when the markets sell because predictors and forecasters are freaking out, take it as an opportunity instead of running away with the herd. And if you are trading, trade the chart in front of you, not the forecasts, feelings, predictions, or guts.