Americans Face Eviction, Equities Hit New Highs While Dividends Get Slashed, and the Fed Thinks Long Term

November 25, 2020 | FIRESIDE CHARTS

Happy early Thanksgiving Fireside Charts readers! While we’re grateful for our families, our jobs, and our homes this Thanksgiving, we’re reminded that many are not so lucky—particularly in 2020—and are facing struggles that are likely to worsen in the coming months. A wave of foreclosures and evictions is approaching, many are being pushed out of the workforce, and small businesses are wading further into debt to stay afloat. And the market may have hit new highs recently—the Dow crossed the 30,000 milestone for the first time ever yesterday—sending sentiment soaring, but dividend suspensions and decreases have also spiked this year, surpassing 2008 levels. Could we be due for a pullback? The Fed meanwhile has focused much of its attention on purchasing longer-term treasuries this year, but how will inflation come into play? Finally, the manufacturing sector looks to be holding up well both here and abroad, and growth is accelerating here in the U.S. Will the trend continue into the winter?

Have a happy, safe, and healthy Thanksgiving, and we’ll see you back here on Monday.

1. The new administration has many tough tasks to face in the transition. Again, millions of new homeless families will not help anyone nor anything…

Source: U.S. Census Bureau, Household Pulse Survey, from 11/24/20

2. Similar to after the Great Recession, many Boomers who lost their jobs are not willing/unable to find a new one and they are simply leaving the workforce…

Source: The Daily Shot, from 11/25/20

3. A nasty pandemic-related reality….

Source: The Daily Shot, from 11/25/20

4. As companies and analysts alike get a better handle on earnings post-pandemic shutdown, the earnings picture continues to improve…

Source: Goldman Sachs Investment Research, from 11/25/20

5. Many sentiment indicators, including CNN’s here, are showing that the market is due for a pullback from extreme bullishness…

Source: The Daily Shot, from 11/25/20

6. Not only is Ecommerce and cloud-based tech soaring due to expanding business lines and sales, their stocks have seen record inflows this year…

Source: BofA Global Investment Strategy, from 11/24/20

7. A great chart that puts into perspective the magnitude of the recent value rally versus the potential. Is this a new trend or just a transient mini rally?

Source: The Daily Shot, from 11/25/20

8. Not only are bond yields at “ultra-low” levels, pandemic-related dividend cuts have lowered stock yields as well…

Source: S&P Dow Jones Indices, through 11/12/20

9. Yes, in the short run this will help flatten the curve, but in the long run, locking in low rates for 30 years will help the government retire the surge in debt as it gets inflated away…