{"id":85952,"date":"2023-11-18T03:27:19","date_gmt":"2023-11-18T08:27:19","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/10-reasons-for-investors-to-be-thankful-this-thanksgiving\/"},"modified":"2023-11-18T03:27:21","modified_gmt":"2023-11-18T08:27:21","slug":"10-reasons-for-investors-to-be-thankful-this-thanksgiving","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=85952","title":{"rendered":"10 Reasons For Investors To Be Thankful This Thanksgiving"},"content":{"rendered":"<div data-test-id=\"content-container\">\n<p><figure class=\"getty-figure\" data-type=\"getty-image\"><picture>  <\/picture><figcaption> <\/figcaption><\/figure>\n<\/p>\n<p><strong><em>By Brian Levitt, Global Market Strategist<\/em><\/strong><\/p>\n<hr>\n<p>It\u2019s the time of year to reflect on what makes us thankful. For me, it starts with life having returned to a level of normalcy. It was only a few years<span class=\"paywall-full-content invisible\"> ago that the COVID pandemic had us altering our Thanksgiving Day plans. I, for one, won\u2019t miss having to hold the family gathering outside in 40-something degree weather. It wasn\u2019t ideal, but in hindsight I was fortunate to be healthy and together with family.<\/span><\/p>\n<p class=\"paywall-full-content invisible\">As I once again return to the familiar Thanksgiving routine, I\u2019m mindful of the many challenges that the world is facing and have no intention of sugarcoating these issues. I simply want to take a moment to focus on the true spirit of the holiday and remind myself of what I\u2019m thankful for.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">In that spirit, below is a list of 10 items that investors can be thankful for this year.<\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\">1. The US economy has been resilient<\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The \u201cmost-anticipated\u201d recession on record has not occurred. Not only is the economy not in recession, but it has grown at a strong clip in 2023.<sup>1<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>2. The costs associated with Thanksgiving are falling<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Gas prices and airfares are falling, making it cheaper for Americans to travel to their friends and families this year than it was in 2022.<sup>2<\/sup> In addition, the traditional Thanksgiving meal won\u2019t cost as much as last year either. The American Farm Bureau Federation reveals that seven of the 11 featured items on the Thanksgiving menu \u2014 including turkey, stuffing, peas, and cranberries \u2014 are down from last year.<sup>3<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>3. The US inflation rate peaked over a year ago<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The inflation rate has fallen from 9.1% in June 2022 to 3.2% in the last reading.<sup>4<\/sup> Admittedly, higher prices are still challenging American households. Nonetheless, the implications for the financial markets have been significant. Historically, the broad US equity market, as represented by the S&amp;P 500 Index, has often performed well in the aftermath of a peak inflation rate, and this time has been no different.<sup>5<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>4. The Federal Reserve has likely finished raising rates<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The rate of inflation has fallen rapidly<sup>6<\/sup>, and the market\u2019s expectation for inflation has been contained within the Fed\u2019s perceived \u201ccomfort zone.\u201d This means the end of policy tightening is likely here.<sup>7<\/sup> This should be music to the ears of investors who have been taught to \u201cnot fight the Fed.\u201d<\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>5. The US job market is still strong<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The US unemployment rate has been under 4% for 1.5 years, while jobless claims remain well below the long-term average.<sup>8<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>6. Most Americans have fixed-rate mortgages<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">How is it possible for interest rates to jump by 5% in less than two years without a significant impact on American households?<sup>9<\/sup> The answer is fixed-rate home mortgages. It\u2019s estimated that 80% of Americans homeowners have fixed-rate mortgages, and most of them have interest rates below 4% or even below 3% after moving or refinancing when rates hit record lows during the pandemic.<sup>10<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>7. Investors do not appear euphoric<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">It\u2019s been said that bull markets grow in skepticism and end in euphoria. Investors do not appear euphoric, with over $22 trillion sitting in bank deposits and money market strategies.<sup>11<\/sup> There appears to be \u201cdry powder\u201d that will likely return to the credit and equity markets in the coming years.<\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>8. US corporate earnings are strong<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">S&amp;P corporate earnings climbed to $220 in the third quarter, nearly doubling since the pandemic-driven low in 2020.<sup>12<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>9. There is income to be found in fixed income<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Not that long ago, investors were clamoring to find yields of greater than 2% or 3%. Today, they\u2019re now presented with higher interest rates across the US Treasury yield curve as well as in corporate and municipal bonds.<sup>13<\/sup><\/p>\n<h2 class=\"paywall-full-content invisible no-summary-bullets\"><strong>10. The US economy has a long history of overcoming substantial challenges<\/strong><\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Through every American generation, the economy has faced its share of challenges and has come back stronger. Over time, markets reflect whether conditions are getting better or worse, and history teaches us that conditions have tended to improve over time, even if the path isn\u2019t always straight. It\u2019s why the market, as represented by the S&amp;P 500 Index, has hit a new high every 16 days since 1957 and is only a stone\u2019s throw away from a new high today.<sup>14<\/sup><\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Happy Thanksgiving. Be safe and be well.<\/p>\n<hr class=\"paywall-full-content invisible no-summary-bullets\">\n<h2 class=\"paywall-full-content invisible no-summary-bullets\">Footnotes<\/h2>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>1<\/sup>Source: US Bureau of Economic Analysis, 9\/30\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>2<\/sup>Sources: American Automobile Association, 11\/15\/23 and the US Bureau of Labor Statistics, 10\/31\/23. Based on the Daily National Average of Regular Unleaded Gasoline Prices and the Consumer Price Index Airfares.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>3<\/sup>Source: American Farm Bureau Federation, 11\/15\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>4<\/sup>Source: US Bureau of Labor Statistics, 10\/31\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>5<\/sup>US Bureau of Labor Statistics, 10\/31\/23 and Bloomberg, 10\/31\/23. Peak inflation dates are Feb. 1970, Dec. 1974, Mar. 1980, Dec. 1990, and Jul. 2008 and the statement is based on the 1-year return of the S&amp;P 500 Index following the peak in inflation. 2008 is the lone exception.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>6<\/sup>Source: US Bureau of Labor Statistics, 10\/31\/23. Based on the US Consumer Price Index.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>7<\/sup>Source: Bloomberg, 11\/15\/23. Based on the 5-year, 5-year forward inflation breakeven, a measure of expected inflation (on average) over the five-year period that begins five years, which is currently below 2.5%<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>8<\/sup>Source: US Bureau of Labor Statistics, 11\/16\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>9<\/sup>Source: Bloomberg, 11\/15\/23. Based on the 10-year US Treasury rate.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>10<\/sup>Source: Bankrate.com, 10\/31\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>11<\/sup>Source: US Federal Reserve and Investment Company Institute, 10\/31\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>12<\/sup>Source: Bloomberg and Standard &amp; Poor\u2019s, 9\/30\/23.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>13<\/sup>Source: Bloomberg, 11\/15\/23. Based on the yields to worst of the Bloomberg US Treasury Index, Bloomberg US Corporate Bond Index, and Bloomberg US Municipal Bond Index. Yield to worst is the lowest potential yield an investor can receive on a bond without the issuer actually defaulting.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><sup>14<\/sup>Source: Bloomberg, Standard &amp; Poor\u2019s, 11\/19\/20.<\/p>\n<hr class=\"paywall-full-content invisible no-summary-bullets\">\n<h4 class=\"paywall-full-content invisible no-summary-bullets\">Important information<\/h4>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Investors should consult a financial professional before making any investment decisions. This does not constitute a recommendation of any investment strategy or product for a particular investor. Investors should consult a financial professional before making any investment decisions.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">All investing involves risk, including the risk of loss.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Past performance does not guarantee future results.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Investments cannot be made directly in an index.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">In general, stock values fluctuate, sometimes widely, in response to activities specific to the company as well as general market, economic and political conditions.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Fixed-income investments are subject to credit risk of the issuer and the effects of changing interest rates. Interest rate risk refers to the risk that bond prices generally fall as interest rates rise and vice versa. An issuer may be unable to meet interest and\/or principal payments, thereby causing its instruments to decrease in value and lowering the issuer\u2019s credit rating.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">Tightening monetary policy includes actions by a central bank to curb inflation.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The yield curve plots interest rates, at a set point in time, of bonds having equal credit quality but differing maturity dates to project future interest rate changes and economic activity.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The US Consumer Price Index (CPI) measures change in consumer prices as determined by the US Bureau of Labor Statistics. Core CPI excludes food and energy prices while headline CPI includes them.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The S&amp;P 500\u00ae Index is a market-capitalization-weighted index of the 500 largest domestic US stocks. The S&amp;P 500 Total Return Index assumes that all cash distributions are reinvested.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The Bloomberg US Corporate Bond Index measures the investment grade, fixed-rate, and taxable corporate bond market. It includes USD-denominated securities publicly issued by US and non-US industrial, utility, and financial issuers.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The Bloomberg US Municipal Bond Index is a rules-based, market-value-weighted index engineered for the long-term tax-exempt bond market and includes bonds rated investment grade by at least two of the three major rating agencies (Moody\u2019s, S&amp;P, and Fitch).<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The Bloomberg US Treasury Index is an unmanaged index of public obligations of the US Treasury with remaining maturities of one year or more.<\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\">The opinions referenced above are those of the author as of <strong>Nov. 16, 2023<\/strong>. These comments should not be construed as recommendations, but as an illustration of broader themes. Forward-looking statements are not guarantees of future results. They involve risks, uncertainties and assumptions; there can be no assurance that actual results will not differ materially from expectations.<\/p>\n<hr class=\"paywall-full-content invisible no-summary-bullets\">\n<p class=\"paywall-full-content invisible no-summary-bullets\"><em><strong>Original post: 10 Reasons For Investors To Be Thankful This Thanksgiving by Invesco US<\/strong><\/em><\/p>\n<p class=\"paywall-full-content invisible no-summary-bullets\"><strong>Editor&#8217;s Note:<\/strong> The summary bullets for this article were chosen by Seeking Alpha editors.<\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/seekingalpha.com\/article\/4652842-10-reasons-for-investors-to-be-thankful-this-thanksgiving?source=feed_all_articles\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Brian Levitt, Global Market Strategist It\u2019s the time of year to reflect on what makes us thankful. For me, it starts with life having returned to a level of normalcy. It was only a few years ago that the COVID pandemic had us altering our Thanksgiving Day plans. I, for one, won\u2019t miss having [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":85953,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[236],"tags":[83],"class_list":["post-85952","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-news","tag-featured","post_format-post-format-gallery"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>10 Reasons For Investors To Be Thankful This Thanksgiving | iFintechWorld<\/title>\n<meta name=\"description\" content=\"By Brian Levitt, Global Market Strategist It\u2019s the time of year to reflect on what makes us thankful. 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