by Gary Alexander

November 22, 2022

At the start of this month (November 1, “Welcome to November, a Month to Be Thankful For”), I mentioned that there would be five Tuesdays in November, so I would write five columns of things to be thankful for – a positive look at these trying markets and life in America, ignored by the Doomsday press. In that column, I mentioned that I believe November 1 is a perfect day to buy stocks, as it is historically the start of the market’s best three months and best six months, and November is #2 historically, behind only April.

On November 8, I wrote about various End-of-the-World themes in market literature that were invariably wrong, and how I and others profited by maintaining a more positive, bullish outlook, resulting in my founding a whimsical group of ex-Doomsday writers called “Apocaholics Anonymous.” Then, last week, I covered the last 50 years since the Dow first crossed 1,000 and showed how we’ve grown richer while top 1970s worries (starvation, domestic bombings, hijackings, and the Ice Age) are now mostly forgotten.

Even in Thanksgiving week itself, I’ve seen so many “bad news” headlines that I wonder how families can gather around the table and “give thanks” for much besides their family and maybe a turkey meal, a four-day weekend, and some football games, given these horrid headlines, so I’ll bring you five upbeat stories this week and five more next week, with a specific goal of showing you the other side of the news.

#1: Forest Fires are Way Down, and the Climate is Mostly Cooler

The last few years have brought tremendous coverage to West Coast fires and endangered homes. At the start of 2022, the news media told us 2022 would be another especially destructive fire season, and they jumped on reporting the first few fires, making it sound as if the coming apocalypse had arrived. But as the season went on, I heard little about wildfires. The California news media was very quiet about what happened. Not a word was said. I wondered why! The reason is that those fires basically didn’t happen.

Most papers have ignored the good news that California wildfires are down by a whopping 86% this year, but The Wall Street Journal is the best paper for reporting good news, and they did so Friday, November 18 (“Less Damage Marks Fire Season’s End,” Page A3). The Journal revealed that only 363,403 acres burned in California this year vs. 2.6 million acres in 2021 and 2.2 million acres/year in the last 5 years.

The Journal added that “cooler than normal weather in some regions was a big reason for the reduced number of wildfires, according to firefighting officials. It delayed the start of fire season in places such as the Pacific Northwest, where mountain snow began melting two months later than expected.”

Again, silence from the rest of the news media, as it didn’t fit their warming paradigm!  At the same time, we’re reading of West New York getting “slammed with nearly 6 feet of snow, triggering road closures and flight cancellations the weekend before Thanksgiving.” Such headlines usually appear in January.

So far, 2022 is cooler than 2021, and Wired Magazine had this great headline in January 2022: “The World Was Cooler in 2021 Than 2020. That’s Not Good News” (basically because it was still pretty hot out there!) But this is “cold comfort” to the people of Europe and New England who can’t afford buying heat this winter.

#2: Tech Companies Are Laying Off Thousands (After Hiring Millions)

On November 16, ABC News (among many others) ran down a long list of tech companies that “have imposed major layoffs in 2022.” The subhead used a blunt verb: “Recession fears and rising interest rates have bludgeoned the industry.” This specific claim caught my eye: “Amazon is set to lay off about 10,000 workers, marking the largest job cuts in the company’s history” but Amazon doubled its work force from 800,000 to 1.6 million the previous two years, so cutting 10,000 from this army that has arisen so rapidly is no big deal. Some trimming was inevitable. Still, here are two sample headlines on the cuts:

Amazon’s Horrible CEO Guts Thousands

Story by Douglas A. McIntyre • Tuesday, November 15 (24/7 Wall Street)

Amazon set to lay off thousands of workers as the holidays approach

–ABC News

Here’s the truth, in perspective:

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

There are seldom headlines about specific company hirings, just layoffs, but millions of NET new jobs are added each year, and this “net” includes millions of layoffs, and many more millions of hirings. As usual, CNBC, the business channel, puts this in better perspective than ABC, the populist news channel:

“Hiring is still strong, despite economic headwinds, according to the Labor Department’s latest jobs report.” Zip Recruiter Chief Economist Julia Pollak says, “employers are adding 60% more jobs each month than prior to Covid. …Layoffs remain historically low at 1.3 million, or under 1% of the work force, and there are still nearly two job openings for every available worker. Pollak says that as of October, 2022 is the best year on record (since 2000) for having the lowest number of layoffs per month.”

–CNBC, November 10, 2022

#3: The Supply Chain is Nearly Fixed, so Shopping Shelves Will Be Full
(With Prices Falling) This Christmas

Friday’s Wall Street Journal featured a front-page story: “Supply Woes Ease, Leaving Shelves Full for Holidays.” The story begins: “After two years of disruption, supply chains are almost back to normal. That means shelves should be fully stocked and some prices actually will be lower this holiday season.”

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

The Global Supply Chain Pressure Index, compiled by the Federal Reserve Bank of New York, is falling fast (chart, above left) and may reach its pre-pandemic level in early 2023, while the Institute for Supply Management’s Supplier Deliveries Index is at its most favorable reading since 2009 with nearly 90% of panelists reporting the same or faster deliveries compared to the prior month. Last January, 109 container ships were waiting to unload outside Los Angeles harbor. Now, only six ships are waiting to unload.

Have you read any of these figures (outside of the WSJ), or seen them on your nightly news? I doubt it

#4: The Mid-Term Election Results Are Just What the Market Ordered

At first, it looked like the Red Wave was reduced to a trickle. The Republicans failed to secure the Senate and for a while it was questionable if they could win back the House. As of last weekend, Republicans have secured at least a three-seat House majority and probably will reach a seven-seat margin when all the votes are counted, and the new members are sworn in come January 3, 2023. On the surface, that result looks humbling to both Parties, and it is, but that is good. A humble politician is a rare commodity.

For the next two years, we will enjoy a return to “gridlock,” a condition the market savored for six years in the Reagan era with a Democratic Congress, 1982-88, and another six years with Bill Clinton and a Republican Congress, 1994-2000. Neither Party can wreak too much havoc with checks and balances.

The Republicans have been chastened by not winning as decisively as they had hoped, and former President Trump should be chastened for not seeing his key hand-picked candidates prevail. At the same time, President Biden’s game plan has been vetoed by a plurality of three million more Republican voters for House candidates than Democratic voters, so neither Party can claim any sort of “mandate” of victory.

The market usually soars during the third year of a Presidential cycle, and especially when the House changes hands against the President’s Party. That has only happened five times since 1950, when the S&P 500 was born – in 1954, 1994, 2006, 2010, and 2018. The following years averaged 21.7% gains.

#5: Many Food and Fuel Prices are Down Sharply in the Past Month

And finally, as you sit down to Thanksgiving dinner, give thanks for price declines in the past month

Bon Appetit…and Happy Thanksgiving!

Navellier & Associates owns Amazon.Com Inc. (AMZN) in managed accounts. Gary Alexander does not personally Amazon.Com Inc.(AMZN).

All content above represents the opinion of Gary Alexander of Navellier & Associates, Inc.

Please see important disclosures below.

Also In This Issue

Global Mail by Ivan Martchev
Watch the Bond Market

Sector Spotlight by Jason Bodner
Headlines Say One Thing – Investor Action Says Another

View Full Archive
Read Past Issues Here

About The Author

Gary Alexander

Gary Alexander has been Senior Writer at Navellier since 2009.  He edits Navellier’s weekly Marketmail and writes a weekly Growth Mail column, in which he uses market history to support the case for growth stocks.  For the previous 20 years before joining Navellier, he was Senior Executive Editor at InvestorPlace Media (formerly Phillips Publishing), where he worked with several leading investment analysts, including Louis Navellier (since 1997), helping launch Louis Navellier’s Blue Chip Growth and Global Growth newsletters.

Prior to that, Gary edited Wealth Magazine and Gold Newsletter and wrote various investment research reports for Jefferson Financial in New Orleans in the 1980s.  He began his financial newsletter career with KCI Communications in 1980, where he served as consulting editor for Personal Finance newsletter while serving as general manager of KCI’s Alexandria House book division.  Before that, he covered the economics beat for news magazines. All content of “Growth Mail” represents the opinion of Gary Alexander

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