In today’s Steady Investor, we are taking a deeper dive into key factors that we believe are impacting the market and what’s to come this year, such as:
December Inflation Data Ticks Slightly Higher – The U.S. Labor Department reported this week that a closely watched inflation gauge, the Consumer Price Index (CPI), rose 3.4% in December from a year earlier, a slight acceleration from November’s 3.1% print. On a monthly basis, prices rose 0.3% month-over-month which was also higher than November’s 0.1% month-over-month gain. Digging into the data, consumers were seen paying more for rent, property and casualty insurance, and services like dentist visits. On the flip side, Americans saw lower prices for goods like furniture, toys, and sporting equipment. The divergence in prices between goods and services has been a fairly consistent theme over the past year, as supply chain pressures have fully eased and as labor shortages and high demand put pressure on services. We’ve written many times before in this space that rent data happens on a lag, and that its contribution to headline inflation should wane in the coming months. The Fed likely acknowledges this feature of the data, and few expect that they will change their policy stance as a result of this latest CPI data. The central bank is still projecting 75 basis points of rate cuts throughout 2024. Americans are also expecting inflation pressures to ease this year. According to a Federal Reserve Bank of New York survey, consumers are anticipating 3% inflation this year, which is the lowest level since January 2021.1
8 of the Biggest Financial Mistakes You Should Avoid
We believe there are eight common mistakes that many investors make when planning for retirement. In our guide, 8 Retirement Mistakes to Avoid, we discuss the most common investing pitfalls that, in our view, can foil your retirement plans. This guide will dive into these common mistakes, such as:
If you have $500,000 or more to invest and want to learn more, click on the link below to get your free copy:
Learn About the 8 Retirement Mistakes to Avoid!2
America’s Quiet Oil Boom – The headline news on oil over the past few months has been largely centered on Saudi Arabia and OPEC+’s ongoing stance on production cuts. Many oil traders have worried that ongoing geopolitical tensions with two wars, combined with less OPEC production, would put sharply upward pressure on prices. That largely hasn’t happened. One key reason that does not get much press coverage is record U.S. production. In the week ended January 5, field production of crude oil in the U.S. reached 13.2 million barrels a day, which is just a hair below the record 13.3 million barrels a day reached in December. U.S. oil production has been bolstered by productivity gains tied to technological advances, not necessarily a surge in investment and employment in the industry. Much of the U.S.’s oil is hitting global markets, with tankers carrying record amounts of crude oil to Europe and the U.K. Ship-tracking firm Kpler said that the EU and the U.K. imported some 2.3 million barrels a day in December, nearly double what they imported before Russia invaded Ukraine.3
Bitcoin ETFs Approved, But Investors Should Remain Cautious – In something of a landmark decision, the U.S. Securities and Exchange Commission voted 3-2 on Wednesday to approve the issuance of ETFs investing in Bitcoin. There are currently 11 applications among various brokerages to issue Bitcoin ETFs, which will give investors the ability to buy ETFs much like they would stock and bond ETFs, in a brokerage account or even in IRA and other retirement accounts. Previously, investors had to buy and sell Bitcoin on cryptocurrency exchanges with sizable transaction fees, or perhaps do so in an encrypted wallet with complex features. The SEC makes clear that the decision to allow Bitcoin ETFs is not an endorsement of Bitcoin as an asset class, and in fact, the SEC Chairman, Gary Gensler, has repeatedly emphasized the risk, uncertainty, and proliferation of fraud in the cryptocurrency space. In our view, investors should proceed with a great deal of caution. Risk assets should be valued on their ability to generate free cash flow and earnings, which Bitcoin does not do.4
Working on Your Retirement Plan? Here Are 8 Mistakes to Avoid – While we can’t predict or control the future of the market, it is possible to stay focused on actions that can help guide your future investments. There are common mistakes and habits that we believe can help some investors succeed while others fail. Don’t fall prey to common investing mistakes.
To help you understand some of these mistakes and how to avoid them, we have created the guide, 8 Retirement Mistakes to Avoid.5
In this guide, we provide our thoughts on what we believe are 8 of the biggest retirement mistakes investors should avoid. If you have $500,000 or more to invest and want to learn more, click on the link below:
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