In this week\u2019s Steady Investor,\nwe look at three factors and provide our view on how we see them affecting the\nmarket in 2022:<\/p>\n\n\n\n
The Federal Reserve\nMakes a Big Announcement \u2013 <\/strong>The\nFederal Reserve wrapped up a two-day meeting on December 15, and with the\npost-meeting press conference came a largely surprising announcement: market\nparticipants should expect interest rate increases in 2022. Fed watchers have\nknown that this mid-December meeting would result in a quickening of the Fed\u2019s\n\u2018tapering\u2019 plans. Fed Chairman Jerome Powell had largely telegraphed the Fed\u2019s\ngoal to unwind the bond and mortgage security purchase program by next March\ninstead of next June, and this plan was confirmed Wednesday by the Fed\nannouncing a reduction of purchases by $30 billion a month instead of $15\nbillion a month. But the somewhat surprising news came when it was revealed\nthat all 18 Fed officials expected fed funds rate increases next year. And not\njust one rate increase \u2013 three. <\/em>This\npolicy pivot indicates the Fed has become more concerned with inflation than\nwith the jobs market, which continues to have more job openings than unemployed\npeople actively seeking work. The stock market welcomed the Fed news, at least\non the day of the announcement. The S&P 500 rallied over +1% for the day.1<\/sup><\/p>\n\n\n\n How Can Investors Deal With Volatility Without Eliminating It? If you and $500,000 or more to invest and want to get answers to the questions above, click on the link below to download this guide today! U.S. Consumers\nContinue to Ramp Up Purchases \u2013 <\/strong>Retail\nsales rose by 0.8% in November from the previous month, signaling that U.S.\nconsumers have thus far been unfazed by the <\/p>\n\n\n\n Omicron variant\nand continue spending strongly this holiday season. The 0.8% increase in\nNovember marked a slowdown from October\u2019s robust 1.8% rise, but indicates\nmomentum is carrying through the holiday shopping season. Some forecasters are\nwondering if consumers moved up their purchases to earlier in the season, given\nworries over inventory availability tied to supply chain issues. That makes\nDecember a key month to watch. Compared to a year ago, retail sales rose a\nstout 18.2% in November, which it should be noted is far higher than the\nyear-over-year rate of inflation (6.8%) posted over the same period.3<\/sup><\/p>\n\n\n\n U.S. Housing Market\nPowered by Millennials \u2013 <\/strong>The U.S.\nhousing market continues to appreciate at a brisk pace. According to the\nNational Association of Realtors, the median price of an existing home sold in\nOctober was approximately $354,000, which is up about 13% from a year ago and\nnearly marks a record. Home prices across the U.S. have climbed for a record\n116 straight months. Where is all the strong demand coming from? Upon analysis\nof home-purchase loan applications over the last year, the answer is clear:\nmillennials. More than half of all loan applications made in the last year were\nfor people born between 1981 and 1996, with 67% of those applications being for\nfirst-time home purchases. The Covid-19 pandemic certainly contributed as well\n\u2013 the catalyzation of remote, work-from-home capabilities spurred many\nmillennials to leave cities for bigger spaces in the suburbs. The wave is seen\nby some economists as a one-time pull forward of sales that would have\notherwise been spread out over many years, but that doesn\u2019t mean millennial\ndemand for homes is likely to abate soon \u2013 the largest cohort of millennials\njust turned 30 in 2021, which is below the median first-time homebuyer age of\n33. Prices continue to surge because this demand is not being met with enough\nsupply. According to Freddie Mac, the U.S. housing market was 3.8 million\nsingle-family homes short of what would be needed to meet demand.4<\/sup><\/p>\n\n\n\n How to Handle Market Volatility<\/strong> \u2013 Volatility will always be a normal (and\nsometimes stressful<\/em>) part of market flow, but there is no better time to\nlearn how to deal with it! <\/p>\n\n\n\n We believe the key is not to look\nfor ways to eliminate it, but to develop a mental approach to dealing with it.\nOur Volatility guide, \u201cHelping You Manage Market\nVolatility\u201d5<\/sup> will provide you with insights and tips to do just\nthat. Get answers to questions like:<\/p>\n\n\n\n If you and $500,000 or more to invest\nand want to get answers to the questions above, click on the link below to\ndownload this guide today!<\/p>\n","protected":false},"excerpt":{"rendered":" Fed signals rate rises in 2022, U.S. consumers power strong holiday sales, housing prices continue to rise<\/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-10053","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\/10053","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=10053"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10053\/revisions"}],"predecessor-version":[{"id":10238,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10053\/revisions\/10238"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=10053"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=10053"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=10053"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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<\/a><\/strong>
A common challenge that investors face is not in finding a way to eliminate volatility– but developing a mental approach to better deal with it! We are offering a free guide that will provide you with insights and tips to do just that. Get answers to questions like:<\/p>\n\n\n\n
Download Zacks Volatility Guide, \u201cHelping You Manage Market Volatility.\u201d<\/a>2<\/a><\/sup><\/strong><\/p>\n\n\n\n