I made it through the Thanksgiving holiday with little or no damage.
Black Friday provided a bit of change with in-store sales lower than last year, but online sales more than making up for the loss.
With cyber Monday this week, it appears that any rumors of a lump of coal in the stocking were a bit exaggerated.
It does appear that consumers are benefitting from discounts on prices due to large inventories.
Most of the reports I heard this weekend were on the order of holiday shoppers spending as much as last year, but maybe not getting as much back for their money.
I am not seeing that as I ventured out shopping this weekend.
I will say though that my shopping now is restricted to HEB, Home Depot, Walmart, Academy and Specs.
While not a Prime member, I do use Amazon.
The ability to order on line and have it delivered to the store is a real benefit.
With that said, you have to give it up to the fact that the equities market has recovered from the June and September lows.
Commodities prices have fallen back.
Crude is where it was a year ago and the housing slowdown has put a crimp on many base commodity prices.
You take that with the COVID situation shutting down China, one would think that inflation has to be slowing down.
The problem with that scenario is that we are still far above the Fed target of 2%.
We will probably find the Fed raising rates again in December.
The big debate will be whether it will be 75 or 50 basis points.
Moreover, many look further down the road to when the Fed will stop raising rates.
I sincerely believe they will push the Fed funds rate to 5%.
It then becomes how fast we get there.
It’s reasonable to think that taking time to let the previous rate increases impact the economy would be appropriate.
There is definitely a lag until one sees the consequences of the Fed’s actions.
What is going on in China and Europe may prove to be more important.
The winter is here and heating costs have yet to hit.
There are rail strikes in Europe and potentially here in the U.S.
These are the type of unexpected events that can severely impact our economy.
Of course you would expect a Santa Claus rally pushing through to the first part of January.
I have been working with clients taking some money off the table with the recent gains or at least getting ready to pull the trigger.
You can soften the impact of tax gains by eliminating losses in your portfolio.
Now will be the time to see which side rejoices the Holiday season - bulls or bears.
