Jobs Come Roaring Back, ISM Services PMI Hits New Record, and the Spike in the Global Money Supply
April 7, 2021 | FIRESIDE CHARTS
U.S. job openings blew past expectations and surged to a two-year high in February as the job openings rate hits its highest level on record. As competition for employees heats up though—even in the battered hospitality industry—is wage inflation far behind? After a slower recovery than we saw from manufacturing, the services PMI is also at a record high in yet more evidence of the strengthening recovery. Meanwhile, the broad money supply—fueled largely by unprecedented stimulus efforts—surged to new heights in the Covid-era and is now flashing reminders of other periods of high inflation. And are investors falling victim to “diworsification” during periods of market strife?
1. As those industries most affected by Covid begin to reopen, they join the rest of the economy’s stimulated surge and together have created more job openings than ever before:
Source: The Daily Shot, from 4/7/21
2. With such a large demand for workers, it makes sense that wage inflation is a real possibility:
Source: The Daily Shot, from 4/7/21
3. Joining the manufacturing surge, the services PMI hit a new record as the economy—still absent many Covid factor industries—is firing on all cylinders…
Source: The Daily Shot, from 4/6/21
4. Has the fix-up-your-home/home office trend run its course?
Source: The Daily Shot, from 4/6/21
5. Has the ecommerce thrust come at the expense of future sales (like tech/telephony in the late 1990s), or have we really undergone a permanent sea change?
Source: The Daily Shot, from 4/6/21
6. This chart is critical. Deficit spending does matter! Our government has begun to compete with private enterprise for capital and the ever-increasing debt to stimulate the economy is similar to pushing on a string…
Source: The Daily Shot, from 4/6/21
7. Will the surge in the global money supply spur inflation?
Source: The Daily Shot, from 4/6/21
8. The FED, in its attempt to ward off a recession or worse, has provided enough money supply to match other inflationary periods including both World Wars:
Source: The Daily Shot, from 4/7/21
9. Diversification or “Diworsification”? Equity correlations rise during periods of market strife, which strips away much of the benefits of diversification:
Source: The Daily Shot, from 4/7/21
10. China also saw a rebound in their services PMI which may start to help our trade deficit…
Source: The Daily Shot, from 4/6/21
11. Covid has its own plans. As we race to vaccinate against another wave here at home, many countries including Brazil and India (below) are suffering mightily…
Source: JHU CSSE, as of 4/6/21
12. Since herd immunity requires ~75% of a population to be inoculated (the % varies), this is encouraging!
Source: The Daily Shot, from 4/6/21
13. While China has been magnanimous in exporting their vaccines, unfortunately there is growing evidence they do not work (or work well) against the new variants. With over 100,000 new cases a day, should India be exporting at all?
Source: Statista, from 4/6/21
Disclosure: The charts and infographics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are they a recommendation to take any action. Individual securities mentioned may be held in client accounts. Past performance is no guarantee of future results.