Divergence
This is the word to describe the present state of the market. The Dow's rally had little strength. It showed its weakness last Friday to which was options expiration day and it had no volume or energy. On the other hand, the NAASDAQ rose on strong volume. This is not harmony. The market is calculating too many aspects with no clear determination on any of them. The war in Ukraine? The unmentioned conflict of national currencies? Inflation? Will the Fed slow their rate hikes and pivot? Will their be an earnings season with plus surprises? Will China opening up versus COVID be a worldwide pump to global nations? What about Davos? The Chinese Lunar New Year? These and many other questions is the easy part to the equation. The hard part is the correct answers.
Where to Begin?
King Dollar is always the centerpiece. However, teck is offering the first salvo. Job cuts were sprinkled into the news last week and this. When giants like Amazon drop 18,000 people, you take notice. They are not alone. FB = 11,000, Google = 12,000, Microsoft = 10,000, Shopify = 6%, 3M = 2,500 and a host of other players in the teck field giving pink slips to another 70,000. People are losing jobs and these are better paying occupations. This is not good for the economy. By the way, the CEO of Rocket Mortgage sold a large portion of his shares at the high of his companies share price. What does he know? What does he see? Whatever your conclusion, it will not be a positive to the economy.
Meanwhile,
$King Dollar is retreating. Since it touched 114.75 last September, it has dropped straight down. It has given up 13-points. This is huge! It is in the range of its last breakout. Between now and 1 February when the Fed declares its next interest movement, the next direction of the dollar will be determined. If it rises, the market sinks. If it continues to fall, the rally will have legs. Keep in mind, the dollar effects everything from US corporate profits to commodities and ultimately, global trading. Divergence.
Speaking of Commodities,
the word from Davos is copper is in play in 2023. Elite analysts cite its many uses, supply levels and future production. Now, the good doctor is known as the bellweather of economies. If you need copper, then, you must have many strong points to your economy. This forecasts a rising stock market, but high prices is the best medicine for less demand. Divergence.
Continuing,
on commodities. Oil is showing strong resistance at $75. However, it really depends on what happens in China. If their demand is not what it use to be, oil could fall below support level. Staying in China, their lunar year begins at the end of the month. Will they run-around and visit this holiday season? Will they resume buying gold with the price at its high? Whatever will take place, usually has a quiet period in all commodities until their joyful season is over. After the first week in February, oil and gold will receive their direction. This is not divergence, but an unknown.
Real Danger...
...in the world came with the knowledge that China shot a hypersonic missle around the world. US soldiers reported seeing a UFO. People, this was this rocket. Now, Russia fired a similar missle around six months ago. Putting the two together, the world is totally unsafe. Any world location could come under fire. The arms race is resuming...This is reflected with the Doomsday Clock moving to the end of civilization by another 90-seconds. Climate change could see a point of no return, if any of us are left? Getting closer to home...
What Kind of Society...
...do we have? There are two scary reports and this stat, the US has had 40 mass shootings in 24 days. Now, the reports. The first says that 25% of ALL New England children are obese. We are raising "fat" kids. This tells me that the anti-PF group are so, so, very WRONG! Not only do we need PE, but we should declare a war on junk food just like the cigarette firms. If there is no real food in your product other than fat, these bastards must put it on the label. It should read, "No nourishment. Bad for your health." Speaking of idiots that have too much influence, kids can become more than bullies. They can become monsters. There is a place for corporal punishment in our schools. Kids have no male role models. We have too many broken homes. Until we can address this, we need some form of real punishment in schools. Detention is a joke. While on the topic of reform, consider our foster care system?
The second report says that 17% of juveniles, held in custody, were at one time in our foster care system. What does that tell you about the care in the system? We need to cut back on wasteful military spending, start taxing the rich and put that money into mental help and care.
Oh, yeah! In the battle between our two greatest cities, LA has nudged ahead of New York with the most homeless. That aspect alone tells you that government reports on unemployment is BS! The more scary point to this is the lack of affordable housing and there are 1.2 million on the border. They seek a better life. They will receive our low-level jobs to which caused our homelessness and this will cause the sad situation to get worse. Everyone cannot live in America. Afrer we address our citizens needs, then we can admit immigrants. By the way, let's pray that the idiots stop listening to the warmongers. And let's also pray that the chickens get better and lay some eggs. The cost of a dozen has become a luxury item. Peace.
