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Uncertainty Reins
The Market Bull 2019

00:00 / 2:42

The Market Bull – December 10, 2019

The major averages close about even unable to hold their early gains as uncertainty reins with the trade war, Brexit and impeachment center stage.

With the House about to receive official articles of impeachment the process continues along the expected path with both victory and guilt claimed by the democrats and innocence, of course, by the republicans. In time I’m sure the truth will come out, I’m just glad my name isn’t Trump. The trade war particularly with the Chinese shows no sign of resolution as the Trump administration doesn’t seem to be interested in a deal prior to the election next year. Of note, Trump always long on rhetoric and short on facts, noted some 2-years ago that trade wars are easy to win and that it will be our trading partners that will pay the price. I think our farmers would beg to differ, the technology sector should soon start complaining loudly as will your average American consumer with the next round of tariffs set to hit on December 15th, primarily on 160 odd billion in consumer goods. Something that will directly impact families bottom lines. Brexit has taken to the back burner, it persists nonetheless, again with both sides claiming victory at the others expense, time will tell, it always does. Markets do not like uncertainty and there is plenty of it going into the end of the year.

Revised productivity fell .2% in the 3rd quarter a huge miss on the expected .9% gain. Unit labor costs were revised down to a 2.5% advance taking some of the sting out of the report. That said falling productivity and rising costs will not help corporate profits already under pressure from the trade war and weak demand. Rising wages compliments of the late stage expansion were fingered as the primary cause for the disappointing numbers that imply recession is near. So far, while I will readily acknowledge that there has been some softness in the incoming economic data, to date it is not very significant.

Standard and Poors 500 Index closed at: 3,132.52 down 3.44
NASDAQ finished the day: 8,616.18 down 5.64
Gold ended trading at: $1,468.20 up $.10


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