While some employers are rehiring and the total number of people receiving unemployment benefits has ticked down, weekly new claims have yet to fall below 1 million since the onset of the pandemic. And as VIX futures climb on election nerves and news that the DOJ is seeking to weaken legal immunity for tech giants like Facebook and Google, tech remains positive month-to-date—even after recent losses. Finally, as yields creep ever lower to hit multi-century lows, junk bond sales have gone through the roof and set new records. Will investors get crushed by an approaching wave of corporate defaults that’s projected to surpass 2009?
1. New unemployment claims remain well over 1 million/week. As some jobs return, the Covid crisis is claiming others…
![us total unemployment](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-New-unemployment-claims-remain.png)
Source: The Daily Shot, from 9/25/20
2. Markets like to climb “a wall of worry” but they do not like uncertainty. Mega-tech anti-trust and possible removal of legal immunity are weighing on the markets. The risk is showing up in the futures market:
![VIX futures](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Markets-like-to-climb.png)
Source: The Daily Shot, from 9/24/20
3. Despite the FAANG+ stocks taking it on the chin this month, tech is still the only positive sector month to date…
![FAANG](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Despite-the-FAANG.png)
Source: The Daily Shot, from 9/24/20
4. Stocks are not the only asset class to correct this month. In times of duress, all risk assets tend to correlate towards 1…they do the same thing at the same time.
![risk asset trwend](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Stocks-are-not-the-only-asset-class-to-correct-this-month.png)
Source: The Daily Shot, from 9/25/20
5. We were wondering…
![inflastion and gold](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-We-were-wondering....png)
Source: The Daily Shot, from 9/25/20
6. Most investors and advisors have only known a secular decline in interest rates. That game is over! What will you do now?
![10 year yeild](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Most-investors-and-advisors.png)
Source: Deutsche Bank Research, from 9/25/20
7. Are inflation expectations showing up in TIPS purchases?
![record inflation](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Are-inflation-expectations.png)
Source: Bloomberg, LP 2020 Arbor Research & Trading, from 9/24/20
8. Is the desperate search for yield leading the lambs to slaughter?
![unk deluge](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Is-the-desperate-search.png)
Source: The Daily Shot, from 9/25/20
9. Why junk bonds may be in trouble…
![coporate defaults](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Why-junk-bonds-may-be-in-trouble....png)
Source: The Daily Shot, from 9/25/20
10. How will the second Covid wave effect Europe’s manufacturing recovery and expansion?
![Markit eurozone](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-How-will-the-second-Covid-wave-effect-Europe.png)
Source: The Daily Shot, from 9/23/20
11. Another great print here at home…with the same concern as Europe…
![US Markit](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Another-great-print-here-at-home....png)
Source: The Daily Shot, from 9/25/20
12. But is the renewed Covid increase in the heartland beginning to show in the regional Fed data?
![KC Fed Manufacturing](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Is-the-renewed-Covid-increase.png)
Source: The Daily Shot, from 9/25/20
13. The markets like power-sharing for it gives a balance of power. There will likely be a reaction if the House, Senate and White House are all controlled by one party
![biden capital gain](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-The-markets-like-power-sharing.png)
Source: The Daily Shot, from 9/24/20
14. Please forget politics…EVERYONE in Washington needs to focus on balancing the budget.
![Bided spending](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-Please-forget-politics...png)
Source: University of Pennsylvania, Goldman Sachs Global Investment Research, from 9/24/20
15. One issue Covid has helped alleviate:
![](https://blog.investbcm.com/wp-content/uploads/2020/09/9.25-One-issue-Covid-has-helped-alleviate.png)
Source: The Daily Shot, from 9/24/20