In this week\u2019s Steady Investor, we cover news and special\nevents that we believe could impact the future of the market, such as:<\/p>\n\n\n\n
The Federal Reserve\nNow Poised to Raise Rates in March \u2013 <\/strong>Last week we noted that trading in\ninterest rate futures indicates a70% probability that the Fed would increase\nthe fed funds rate at or before their March meeting. The likelihood has risen\nsince. In testimony given to Congress this week as part of his confirmation\nhearing for a second term, Federal Reserve Chairman Jerome Powell referred to inflation\nas a \u201csevere threat\u201d to the economic rebound. This characterization is of\ncourse a long way from the \u201ctransitory\u201d designation that existed just three\nmonths ago. As part of his testimony, Chairman Powell said the Fed is preparing\nto raise interest rates and that the economy no longer needed extraordinary\naccommodation, signaling that the central bank may also begin to trim its\napproximately $9 trillion balance sheet soon after it commences rate increases.\nIn the previous rate hike cycle that began in 2015, the Fed waited years before\nshrinking down its balance sheet.1<\/sup><\/sup><\/p>\n\n\n\n _________________________________________________________________________<\/p>\n\n\n\n Handling Volatility \u2013 What You Should Do!<\/a><\/strong><\/p>\n\n\n\n Volatility often results in emotional decision-making\u2014like\nwhen investors believe that selling out of stocks is the best route to avoid\nfurther losses. The real challenge is not finding a way to eliminate\nvolatility\u2014it is developing a mental approach to dealing with it. Our guide, \u201cHelping\nYou Manage Market Volatility,\u201d will provide you with insights and tips to do\njust that. Get answers to questions like:<\/p>\n\n\n\n If you have $500,000 or more to invest and want to get\nanswers to the questions above, click on the link below to download this guide today!<\/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 _________________________________________________________________________<\/p>\n\n\n\n Are Supply Chain\nProblems Getting Worse or Better? <\/strong>Services and manufacturing PMIs remain firmly in expansion\nterritory, but the Institute of Supply Management said manufacturing activity\nfell from 61.1 in November to 58.7 in December. This data may be good news for\nsupply chains. The reason is that the decline in factory activity was largely\ninfluenced by the \u2018supplier delivery times\u2019 component of the index. In normal\ntimes, falling supplier delivery times imply that demand is waning. In the\ncurrent environment, however, it implies that bottlenecks are clearing. That\u2019s\na sign supply chain problems may have peaked, but there are other indicators\nthat issues could get slightly worse yet. The first is China. Because of\nChina\u2019s zero-tolerance policy for Covid-19, major manufacturers across the\ncountry are shuttering factories and ordering workers to stay home. Government\nofficials are also rolling out mass testing and locking down cities, which is\ncrimping production and resulting in labor shortages. In the corporate realm,\ncompanies like Samsung, Nike, and Volkswagen have already reported production\nissues. Here in the U.S., the surge of Omicron cases is also becoming a\nheadwind to the supply chain \u2013 about 800 Southern California dockworkers, or\n10% of the workforce, have called in sick, which compromises the ability to\nclear the backlog of approximately 100 ships waiting to be unloaded.3<\/sup><\/p>\n\n\n\n For All the\nChallenges of the Past Two Years, Households are in Better Shape \u2013 <\/strong>In the very early days of the pandemic, many feared the worst with\nregards to the economy and personal finances. The unemployment rate quickly\nsoared past 20%, and no one truly knew when economic activity would recover.\nTwo years later, we now know the worst economic fears were avoided, and for\nmany Americans, personal finances are in even better shape than they were\nbefore the pandemic. According to the Census Bureau, the first two rounds of\nstimulus payments lifted close to 12 million Americans out of poverty. Stimulus\npayments, child tax credits, expanded unemployment benefits, healthcare\nsubsidies, and suspended student loan payments combined to help Americans pay\ndown debt and sock away $2.7 trillion in extra savings. Wealthier households fared\neven better, given a historically strong housing and stock market. Families in\nthe top 10% of income had stashed some $1.5 trillion in extra savings as of Q3\n2021, which was more than all other income groups combined. Rising inflation\nhas placed a check on how far these extra savings will ultimately go, but\nrising wages are in effect pushing back. All told, for many American\nhouseholds, they are better off financially today than ever before \u2013 one of a\nfew reasons to be optimistic in 2022, in our view.4<\/sup><\/sup><\/p>\n\n\n\n Navigating Through\nMarket Volatility – <\/strong>One challenge investors will face,\nespecially with continued negative impacts from Covid-19, is market volatility!\nEven though it\u2019s a normal part of the market flow, there are ways to eliminate\nit. <\/p>\n\n\n\n In our guide, \u201cHelping You Manage\nMarket Volatility,\u201d5 <\/sup>we provide you with insights and tips to do\njust that. Get answers to questions like:<\/p>\n\n\n\n If you have $500,000 or more to invest\nand want to get answers to the questions above, click on the link below to download\nthis guide today!<\/p>\n","protected":false},"excerpt":{"rendered":" Federal Reserve to rase rates in March, good and bad news for supply chain, American households in better shape than pre-pandemic<\/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-10109","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\/10109","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=10109"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10109\/revisions"}],"predecessor-version":[{"id":10217,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10109\/revisions\/10217"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=10109"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=10109"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=10109"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}