| | | | As you can see, we have ADP employment data coming out. ISM Services. Fed minutes. Jobless claims. And employment report.
These could all cause stocks to boom or bust this week. The question will be whether or not we’re still in the “any news is good news” regime, or if we’ve transitioned to “bad news is actually bad news.”
Judging by the reports of the last few weeks, I expect the numbers to be bad across the board. There’s no reason for the government to hide the truth anymore now that Biden is about to vacate the White House.
The Fed — along with Treasury — is pulling liquidity out of the system. You can see this in the reverse repo facilities that are draining. The reverse repo market is the overnight lending backing that the Fed provides banks. It smooths inter-bank lending. Less reverse repo dinero, less lending. Less lending, less growth. Many think that the Fed can only cut or raise interest rates! They’re wrong. The Central Bank has many more tools that allow it to fiddle with economy.
But the animal spirits being what they are, optimism over Trump presidency may overwhelm Fed shenanigans. Only time will tell.
FOUR
The payment processor is one of my favorite stocks that I keep going back to. You’ve probably shopped somewhere today that uses FOUR to power their purchases.
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