The Bipolar Economy Of 2023
Published Friday, February 3, 2023 at: 8:20 PM EST
Maybe it’s a sign of the times: The economy is bipolar. The new jobs numbers released Friday morning showed extraordinary strength in the job market and the index of leading economic indicators in January, released Thursday morning, experienced a decline for the eighth straight month, signaling a recession is coming in 2023.
Despite significant bad news in the form of yet another bad month for the LEI in January and experiencing a sharp decline of eight-tenths of 1%, the explosive number of new job figures for January make a recession unlikely.
New job formation was expected to trend lower in January. Due to the aggressive monetary tightening implemented since March 2022 by the Federal Reserve, the economy was expected to create about 200,000 new jobs. Instead, job gains in January came in at 517,000 and the unemployment rate declined to the lowest level in decades.
The Standard & Poor’s 500 stock index closed Friday at 4,136.48 down -1.04% from Thursday, and up +1.62% from a week ago. The index is up +84.88 from the March 23, 2020 Covid pandemic bear-market low. The S&P 500 remains in a bear market that began June 13, 2022. Since a low point at the end of October, stocks have cut their losses in half, closing the week -13.76% lower than its January 3, 2022, all-time high.
The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is a market-value weighted index with each stock's weight proportionate to its market value. Index returns do not include fees or expenses. Investing involves risk, including the loss of principal, and past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.
Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances. The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.
This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.
- Strong Jobs Report Caps A Week For The Record Books
- Why Stocks Rose Friday Despite A Rise In Inflation In April
- Weekly Investor Update
- The Confluence Of Bad News For Recent Retirees And Those About To Retire
- Good And Bad News This Week For Investors
- Getting There: The Economic Balancing Act Progressed In March
- Stocks Gained Friday But Closed Fractionally Lower For The Week
- Good News On Inflation But A Recession May Be Hard To Avoid
- Analysis: The First Data Since The Banking Crisis Erupted In March
- Stocks Gained 7% First Quarter And Other Good Financial News
- Despite Bank Fears And A Fed Hike, Stocks Climbed For The Week
- Bank Panic And Strong 1Q '23 Economic Growth
- Mixed Economic Signals And A Bank Failure
- Service Sector Remained Strong In February, Soothing Investors For Now
- Inflation Rose In January, Indicating Tight Monetary Policy May Continue Into 2024
- Amid Divergent Data, Here's What To Know
- Optimistic Again, Will A Fed Algorithm Be Right Again?
- The Bipolar Economy Of 2023
- On Wednesday, We’ll Know If The Federal Reserve Will End Inflation By Causing A Recession
- Technology Drove S&P 500 1.9% Higher Friday, But Look At Tech's Terrible 2022 Loss
- Here What To Know To Invest Wisely
- Prudence Requires Positioning Portfolios For An Economic Expansion
READY TO TAKE THE FIRST STEP?
Schedule your no-charge, no-obligation Introductory Phone Call.