A Very Tight U.S. Labor\nMarket \u2013 <\/strong>Inflation pressures and the pandemic have many Americans feeling\nas though the economy is not headed in the right direction. But economic fundamentals\npaint a different picture, which is why there seems to be a \u2018disconnect\u2019\nbetween stock market performance and people\u2019s general views on the economy. One\ncase-in-point of an underappreciated, strong economic fundamental: the jobs\nmarket. In the U.S., the number of job openings far exceeds the number of\nunemployed people. According to ZipRecruiter, there are approximately 11\nmillion available jobs in the U.S. versus 6.9 million unemployed people\nactively looking for work (see chart below). Such a strong labor market largely\ngives workers leverage \u2013 the ability to quit a job and seek a better-paying\none, the ability to negotiate higher wages and sign-on bonuses, and the\npossibility of securing better benefits. Indeed, a recent survey by the\nConference Board found that U.S. companies are setting aside an average of 3.9%\nof total payroll for wage increases in 2022, which is the highest percentage\nrecorded since 2008. The survey also reported that companies are planning to\nlift salary ranges, both of which should put U.S. households on a path to\nincrease saving and spending in the new year \u2013 particularly if inflationary\npressures ease. Below, a chart showing the number of job openings (blue line)\ncompared to unemployed workers (red line).1<\/sup><\/p>\n\n\n\n ______________________________________________________________________________________________<\/sup><\/p>\n\n\n\n Why Should You Avoid Market Timing in a Volatile Market?<\/a><\/strong> ______________________________________________________________________________________________<\/sup><\/p>\n\n\n\n The Federal Reserve\nPivots \u2013 <\/strong>About a month ago, the Federal Reserve communicated plans to very\ngradually wind down the monthly bond and mortgage security purchases by $15\nbillion per month, effectively ending the QE program by June 2022. By the end\nof November, however, those plans had been scrapped \u2013 the Federal Reserve,\nresponding to longer and higher-than-expected inflationary pressures, decided\nto pivot. We will know more details about the change of plans after the\nmid-December meeting, but all signs point to unwinding QE on a faster\ntimetable, ending the program by March 2022 instead of June. Also, the Fed\ncould potentially move forward the timeline of raising interest rates, which\nsome investors fear could be an ominous sign for the economic expansion and\nbull market. In a Mitch on the Markets <\/em>column\nthis week, Mitch Zacks weighs in: \u201cIn my view, the Federal Reserve\u2019s shifting\nmessage and policy is in response to a good\nproblem. <\/em>In the words of New York Fed President John Williams, the U.S.\neconomy is \u2019roaring back,\u2019 and supply\/demand imbalances are putting pressure on\nprices. Demand is above pre-pandemic levels, and supply can\u2019t keep up. I don\u2019t\nsee this as a permanent problem.\u201d He added that: \u201ccorporate earnings and economic\ngrowth matter more than the Fed, and I do not think a slight shift in the Fed\u2019s messaging and\npolicy will affect either in the coming year.\u201d4<\/sup><\/p>\n\n\n\n Will Omicron Wreak\nHavoc on Southeast Asia Manufacturing? <\/strong>The surge of the Delta variant\ncreated problems for Southeast Asia manufacturing hubs, like Vietnam, Malaysia,\nand Thailand. We covered some of these factory shutdowns in this space and\nadded that these closures were a key part in creating bottlenecks in the supply\nchain that still exist today. Fortunately, some of the key players in the\nregion \u2013 Thailand and Vietnam specifically \u2013 have shifted away from aggressive\npandemic measures like full shutdowns, instead opting for less restrictive\nmeasures that allow the economy to continue producing. These moves have been\nhelped along by rising vaccination rates, which are likely to continue trending\nhigher as more vaccine supply becomes available.5<\/sup><\/p>\n\n\n\n Should You Time to Market? <\/strong>It can be easy to get swept into the negative headlines that saturate the news. When emotions are running high, many investors fall into the trap of trying to buy \u201cat just the right time,\u201d or selling stocks out of fear. Instead, we recommend focusing on the long-term view and sticking to your course. 11 million U.S. job openings vs. 6.9 million unemployed, Fed likely to accelerate taper, assessing Omicron effects on Asian labor <\/p>\n","protected":false},"author":3,"featured_media":7426,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71,73],"tags":[],"class_list":["post-10033","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-private-client-group","category-steady-investors-week"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10033","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=10033"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10033\/revisions"}],"predecessor-version":[{"id":10243,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10033\/revisions\/10243"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=10033"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=10033"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=10033"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"https:\/\/zacksim.com\/blog\/wp-content\/uploads\/2022\/02\/2_pic1-1024x395.png\")
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Investors often fall into the trap of trying to buy \u201cat just the right time,\u201d or selling stocks in a volatile market when emotions are running high.
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Studies show that the average investor is a poor market timer. In many cases, investors allow emotions and media noise to get the best of them, selling in and out of the market at the wrong times.
Our guide, \u201cHow Market Timing Can Affect Your Retirement Plan3<\/sup>\u201d seeks to explain these behavioral traps and offers potential solutions. If you have $500,000 or more to invest and want to learn how you may be able to avoid these mistakes today, click on the link below to get your free copy:
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Download Zacks Guide, \u201cHow Market Timing Can Affect Your Retirement Plan.\u201d<\/a><\/strong><\/p>\n\n\n\n
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But before making any big decisions, check out our guide, \u201cHow Market Timing Can Affect Your Retirement Plan.\u201d6<\/sup>
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This guide seeks to explain emotional and behavioral traps that investors can fall prey to and offers potential solutions to common mistakes that many self-managed investors make.
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If you have $500,000 or more to invest and want to learn how you may be able to avoid these mistakes today, get your free copy by clicking on the link below:<\/p>\n","protected":false},"excerpt":{"rendered":"