We keep getting the wrong numbers. We see West Texas Intermediate (WTI) crude oil struggling to stay above $80 a barrel and natural gas down 30% over the past 3 months. Oil below $80 a barrel still means gasoline is up 15% and natural gas is up 17% year over year. But we would all agree that these are not gigantic gains as the last 3 months have been quite subdued. Agriculture? Wheat is up 2% this year, while cotton is down 6%. Corn and soybeans are up 23% and 20% for the year, respectively, but are up 2% and 4% in the past two months. We have learned that we have had 6 straight months where existing home sales are weaker, while month-over-month contract signings are down across the country. A drop in signings usually means the buyers will not step up any further, which means the sellers will soon give up and break the price. Year-over-year pending transactions fell 37.8%, further evidence of the slowdown. We don’t know how many people own cryptocurrencies, but they’re down $2 trillion year over year. The S&P, 500, the primary method of 401k/IRA savings, is down nearly 20% year-to-date. The goods are tamed. Your savings are crushed. We know that the Consumer Price Index for November rose a surprisingly low 0.1%, a sharp drop from October’s 0.4%. We had almost no initial public offering issuance, with the number down 82% from the same time last year and only 71% of deals over $50 million. Ridiculous. At $7.7 billion, total revenue is down nearly 95% from the same period last year. . Everything seems to be going in the direction of the Federal Reserve. Except, of course, salaries. We just saw in the Wall Street Journal on Tuesday that it’s incredibly easy for people laid off from tech jobs. Seventy-nine percent secured new jobs within 3 months of starting their search. There are still billions of dollars in companies that have managed to raise a ton of money in different verticals. There was a terrific article on CNBC.com on Wednesday, by Hugh Son, about how many fintech companies are in trouble and many won’t make it out because they were based on interest rates. interest remaining lower. As weak as fintech is, I think most enterprise software companies that wanted to exploit public markets are even weaker, while those that are public are a disaster. Like so many other initial public offerings in the class of 2021. But they too can afford not to have to lay people off just yet. There is simply almost no slack in the system – and until we do, I don’t see the Fed stopping its rate hikes. Why bother? Why not walk a few more times to be sure that all the wealth creation due to the pandemic will be wiped out? It was, in many ways, artificially purchased with free money. But, if you’re part of the Fed, you know this: if you don’t erase what was won with free money, or at least do it the best you can, we won’t see much progress. to stop rising prices. The Fed knows that as long as there is no easing, there will be no decline in trade. There won’t be people staying at home all the time, which will lower the price of outings. Everything will be in place for the Fed in 2023. Of course, we must have more than one month where unemployment is above 4%. If I were the Fed, I would wait until we had 6 months of rising unemployment. The market is currently saying that 2023 will be more like 2022 than we think. I think that’s a possibility for the first few months. But if we see unemployment rise to 4%, then we’ll know the Fed will have to wait a bit to hike further, or it will just pause because that’s its best hope for a soft landing. So while we watch our portfolio and you watch yours, remember what matters: salaries. Until they are reduced, the value of high multiple ratio stocks will continue to be hammered, while the value of high multiple ratio stocks will most likely continue to fall until the Fed finishes raising the rate. Dark? No, just a recipe for being really selective because, never forget, even with rates, that high money is still going into stocks. He just doesn’t go into the same stocks – and with such weak shows, the ones he goes into, is rallying much higher than you ever thought possible. (See here for a full list of Jim Cramer’s Charitable Trust stocks.) As a CNBC Investing Club subscriber with Jim Cramer, you’ll receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, AS WELL AS OUR DISCLAIMER. NO OBLIGATION OR FIDUCIARY DUTY EXISTS, OR IS CREATED BY YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
Traders work on the floor of the New York Stock Exchange during morning trading on December 06, 2022 in New York City. The Dow Jones opened at a low this morning, continuing its downward trend, plunging more than 400 points at the stock market’s close on Monday.
Michael M. Santiago | Getty Images
We keep getting the wrong numbers.
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