In today\u2019s Steady Investor, we look at key factors that we\nbelieve are currently impacting the market and what could be next for the\nmarkets such as:<\/p>\n\n\n\n
Inflation\nKeeps Going Up \u2013 <\/strong>The\nbiggest news to hit the tape this week was the sizable increase in U.S.\ninflation. According to the Labor Department, the consumer price index \u2013 which\nroughly measures what consumers spend on a basket of goods and services \u2013\nsoared by 6.2% in October from the previous year. This level of price increase\nmarks a 30-year high and follows five straight months where inflation has\ntopped 5%. The question of inflation in 2021 has never been about whether <\/em>prices\nwould go up \u2013 it’s been about how much <\/em>and for how long. <\/em>So far,\nthe answers to the latter seem to be that inflation is going up more than expected\nand for longer than expected, though the Federal Reserve continues to lean into\nthe notion that inflation is \u2018transitory,\u2019 largely a product of temporary\nsupply chain issues being met with record consumer demand. Inflation is not\nuniquely a U.S. problem \u2013 nations around the world are seeing increased\nconsumer demand as the pandemic risk fades, and supply chains simply have not\nbeen able to keep up. In theory, once supply chains \u2018catch up\u2019 to meet demand\nand inventory needs, the price pressures should fade. The question is, what is\nthe actual timeline for supply chains being fixed? If the answer is a few\nmonths, it would ultimately make the current spike in inflation less worrisome.\nIf it\u2019s longer, the Federal Reserve may need to step in sooner \u2013 and more\naggressively than originally planned \u2013 to raise interest rates, which could\npotentially start the clock at the end of this profit cycle.1<\/sup><\/p>\n\n\n\n _____________________________________________________________________________<\/p>\n\n\n\n Trading Your Retirement Could Be Hazardous to Your Financial Health\u2026Here\u2019s Why!<\/a><\/strong><\/p>\n\n\n\n It\u2019s no secret that many investors let their emotions and fear drive their investments. Even if you\u2019re a seasoned investor, trying to self-direct your retirement investments leads to extremely high risk \u2013 not because you aren\u2019t competent, but because you are human. Instead of letting your emotions take control, it is essential to focus on the long-term outlook and the hard data.<\/p>\n\n\n\n If you\nhave $500,000 or more to invest, get our free guide, \u201cWhy Trading Your\nOwn Retirement Can Be Hazardous to Your Financial Health\u201d<\/em><\/strong>\u2014it offers\nsome compelling reasons\u2014backed by facts and research\u2014why trading your\nretirement assets can be hazardous to your financial health.<\/p>\n\n\n\n Download Your Copy of \u201cWhy Trading Your Own Retirement Can Be Hazardous to Your Financial Health.\u201d<\/a>2<\/a><\/sup><\/strong><\/p>\n\n\n\n _____________________________________________________________________________<\/p>\n\n\n\n Producer\nPrices Also Jumped, in the U.S. and<\/em> China \u2013 <\/strong>An equally important, but far less\nacknowledged, gauge of inflation is producer prices, as measured by the producer-price\nindex (PPI). A good way to understand the PPI is in relation to the consumer\nprice index, or the CPI. The CPI measures the change in prices from the\nconsumer\u2019s point of view, while the PPI measures the change in prices from the\nbusiness\u2019s point of view. In a sign inflation is currently broad-based, the\nU.S. PPI also soared in October, recording its biggest increase on record at\n8.6%. It\u2019s not a forgone conclusion that higher business prices translate into\nhigher consumer prices, as in some cases the businesses will absorb higher\ncosts (which tends to squeeze profit margins). Understanding the full effect of\nincreases in the PPI is best observed in analyzing corporate earnings, and\ncorporate earnings calls and estimates. China is also experiencing higher\nproducer prices, with factory gate prices soaring by 13.5% from a year earlier,\nfollowing a 10.7% rise in September. That\u2019s the fastest pace of increase in 26\nyears, which could trickle as a factor driving global inflation.3<\/sup><\/p>\n\n\n\n The\nU.K. also Experiences a Soft Patch \u2013 <\/strong>Figures\nreleased this week released by the U.K. Office for National Statistics showed\nthe U.K. also hitting a soft patch this summer, no doubt driven by surging\nDelta cases and slowdowns in Europe and the U.S. The U.K. reported a Q3 GDP\nincrease of 1.3% compared to 2020, which was a notable deceleration from the\n5.5% GDP growth pace set in Q2. Supply chain bottlenecks and a somewhat messy\ntransition out of the European Union have contributed to headwinds, but the\nU.K. also has an issue the U.S. doesn\u2019t — the prospect of weaker consumer\nspending.4<\/sup><\/p>\n\n\n\n Protect\nYour Retirement<\/strong> \u2013 It\u2019s\ncommon for investors to make knee-jerk decisions instead of focusing on their\nlong-term goals. If you are managing your own retirement assets, this could be\njeopardizing your financial security. Trading for short-term profits and\ninvesting for long-term goals are two very different things. <\/p>\n\n\n\n