Is the childcare center your children or grandchildren attend short-staffed? Notable Number 3 in this week’s Weekly Market Review (WMR) highlights the labor shortage issue almost all industries are experiencing. It’s a head scratching phenomenon where there are more jobs available than there are people seeking jobs. A good problem vs. too many people seeking too few jobs, but a problem nonetheless for employers and companies struggling to be adequately staffed. Many of the employed are feeling the struggle in a different way; trying to do their job and sharing responsibilities for those unfilled jobs and the duties and tasks that go with them.
The 2nd paragraph of the WMR details how current Federal Reserve Chairman, Jerome Powell, and former Fed Chair, Janet Yellen, who now serves as the Treasury Secretary, admitted how wrong their estimates and calculations were on how the US economy and US consumer would rebound from COVID. I guess it’s easy to admit you were wrong when things go better than you thought. The end result though is inflation which is driven by both the labor shortage mentioned above and the supply chain issues. These origins point back to the early days of COVID when the world stopped going to work for a while.
Most investors despise weeks like last week where the market whipsaws up and down. For many, there is an emotional rollercoaster of ups and downs that parallel the highs and lows they see in their investment account balances. However, for a smaller number of investors, the higher volatility days are welcomed. The dips, mostly the result of the Omicron variant discovered last week, present buying opportunities for buyers ready with cash. Also for options traders selling calls or puts, the wilder market drives the price of these options higher allowing them to collect more premium. Then there are the short sellers who make money when the rest of us are losing money when the markets turn south. It’s easy and tempting to lose your courage or forget your plan when the markets get choppy, but a big part of my job is to make sure your plan is adequately balanced before we experience the choppy markets. If we have done a good job on the front end designing the plan and portfolio, sticking with the plan during stressful times is a much easier task.
As always, we hope you enjoy the Weekly Market Review and find it both informative and interesting. Have a good Week!
Trevor N. Coe, CFP®