December JOLTS: Slide in Openings Signals Labor Demand Remains Weak
Summary
The December JOLTS report underscored the labor market remains in a precarious position. Job openings fell to 6.5 million and are down around 10% over the past year. The ongoing slide suggests a turnaround in hiring conditions is not yet upon us. Turnover data also suggest labor market activity remains subdued. The hiring and quit rates remained near their lowest levels in roughly a decade in December, excluding the initial months of the pandemicā¦ [end quote] - good charts here.
Stock Market Today: Nasdaq Slumps Again as Jobs Data Collides With Tech Selloff
Amazon earnings disappoint, sending shares down afterhours; bitcoin falls 13%
Investor jitters about tech stocks and the health of the U.S. labor market sent stocks lower Thursday.
The Dow industrials dropped 593 points, or 1.2%, while the S&P 500 also lost 1.2%. The Nasdaq fell 1.6%, adding to its worst two-day pullback since last Aprilās tariff turmoilā¦ [end quote]
And take a look at bitcoinā¦and gold and silver. Bond yields dropped and USD rose as investors flew to safety.
And take a look at VIX. Itās not to panic levels but the market is getting nervous as bubbles seem to be popping.
The āmungofitch 99 day ruleā says that if the market has not made a new high in 99 trading days itās likely that the party is over. Thatās because the market has a lot of noise so itās not easy to determine a genuine trend change. We are far from 99 days since the last high. The trend is still positive.
But a market that has a record amount of margin supporting a historic bubble will deflate at some point.
Personally, Iām risk averse. I never use margin, buy stocks of companies that are fairly valued (not the high-flying growth stocks) and have bonds as ballast. Iām interested in stability and preservation of capital rather than growth so my approach is tuned to my situation.
There is good evidence that this market is similar to 1999 since itās heavily weighted toward AI stocks. I avoided that trap and I plan to avoid this one, even if the wait is long.
Meanwhile interest rates are declining, the Big Beautiful Bill is raising tax refunds, and oil prices are on the low side. The prez clearly wants a strong economy. We may be in a correction but earnings seem strong. The long trend is still upward.
For believers, this is a buying opportunity. Talking heads donāt know much and are best ignored.
Iām concerned that the current administration is more concerned with power and greed than with maintaining a strong foundation for the economy. I fear the grift. Time and again this administration has shown that bribes are openly accepted, celebrated even, with each further emboldening the president. The US has the strongest economy in the world and the global reserve currency because of the stability and entrepreneurism created by a rule of law. That rule is being upended. Where does it end? Where will global capital go if the US is no longer the clear safe haven to invest and park capital? When that shift occurs, PE ratios will drop and the entire market will decline. Perhaps only stagnation instead of collapse?
A few years ago, I shifted to 80% index funds, 15% money market funds, and a handful of highly appreciated individual stocks that I didnāt want to pay the capital gains tax on. Iāll stick with that. If I go broke, the rest of the country is really in the toilet. Still, the US is careening down a dangerous path.
My portfolio seems to be making new all time highs almost daily. And I only own the big AI companies to the extent that theyāre in the index funds I hold.
Iām only about 30% index funds and 2/3rds of my portfolio is highly appreciated long-term buy and hold individual stocks Iāve owned for as long as 35 years.
Iād rather be a stockholder than somebody looking for a job.
My portfolio is simultaneously reaching new all time highs almost daily, and yet it is also consistently underperforming the indices because I also have ātoo much cashā in anticipation of a crash that refuses to happen. I am literally complaining about having too many overpriced equities and too much cash. Weird.
Right now, and for much of last year, international has outperformed US. Last year I had what amounted to a balanced portfolio (bonds around 30-40%), but with a strong tilt to Europe and abroad. VGK, VXUS, IDVO, BNDX. I out-performed the S&P 500 while having a reasonable exposure to bonds because of that.
Doing it again this year, with an even higher foreign tilt. I currently have more international equities than domestic. And currently higher YTD than the S&P500 again.
My international equities also outperformed U.S. equities last year and so far this year, and I am playing it as a long term āsell Americaā trade even though historically international outperformance has been short lived. I have been slow to move my sheltered money into international funds because I do not know how much I will lose due to any foreign tax credits that may not be protected by my sheltered accounts.
If the only thing you are concerned with is your money, and not the much broader ramifications he brought up, things that absolutely can impact your ability to make money in the future, I donāt know what to tell you.