Author: Christopher Lewis

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International Finance Forum Releases Global Finance and Development Report 2021

International Finance Forum Releases Global Finance and Development Report 2021

GUANGZHOU, China, Dec. 3, 2021 /PRNewswire/ — International Finance Forum (IFF) today released the Global Finance and Development Report 2021 (GFDR) and Global Green Finance Development Index (GGFDI) along with country rankings.

“This is the first year that IFF is releasing the GFDR report and it will be released annually during IFF global meeting in the future,” introduced Zhuang Juzhong, chief economist of IFF and a former deputy chief economist of the Asian Development Bank. “The report aims to provide an annual assessment of global economic trends and prospects, financial development and innovation, and address long-term challenges and policy issues based on cross-country data, and eventually, promote international discussion and cooperation,” added Zhuang.

The GFDR consists of three chapters:

Chapter 1: Global economic outlook, risks and policy priorities. This chapter provides the latest updates on the COVID-19 pandemic and recent global economic development, and assesses the economic outlook, risks, and policy priorities. It encourages the global community to work together to speed up the vaccination rollout and eliminate vaccine inequality, ensure a smooth monetary policy transition, end trade tensions, promote green recovery, and support low-income countries.

Chapter 2: Global green finance development index and country rankings. This chapter focuses on recent global developments of green finance and launches GGFDI with country rankings. Jointly developed by IFF and the Central University of Finance and Economics in China, GGFDI applies a quantitative measure of progress in developing green finance at the country level and focuses on three areas: policy and strategy, product and market, and international cooperation. The GGFDI also provides rankings in green finance development of the world’s 55 largest economies as of the end of 2020.

Chapter 3: Roadmap to global carbon neutrality and China’s actions. This chapter reviews and assesses the measures on transformation of global energy systems and industrial sectors, and policy measures required to achieve the 2°C and 1.5°C climate targets set by the Paris Agreement. It also summarizes China’s technical solutions and policy options for achieving dual carbon goals.

With the launch of GFDR and GGFDI, IFF is encouraging more global discussions on policies needed to end the pandemic, reduce risks to the global economic recovery, promote green investment, fight against climate change, and make development more inclusive and sustainable.

For the full report, please visit: http://iff.org.cn/uploads/2021GAM/GFAD-report20211202.pdf

SOURCE International Finance Forum (IFF)

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Finance jobs: All your options

Finance jobs: All your options

Finance jobs can offer practical experience, in a diverse set of roles, for graduates with strong financial and analytical skill sets. Graduates may apply their industry knowledge and explore a broad range of finance careers. 

From accountants and economic analysts to other fulfilling career options, such as investment bankers and portfolio managers, the opportunities are limitless.

What’s it like to work in a finance job?

Personal finance, corporate finance, and government finance are widely recognized as the three finance subfields. Other subfields include investments, money and credit markets, and financial management. 

Graduates and working professionals can pursue careers in corporate financial management, securities analysis, and commercial lending, along with several other financial career institutions. Finance professionals typically interact with attorneys, accountants, and insurance agents. In the right work setting, both introverts and extroverts can enjoy rewarding financial jobs and long-term careers. 

Finance job seekers may seek remote opportunities as financial analysts, financial advisors, accountants, and other offsite career opportunities. Industry professionals may work between 50 and 70 hours per week. Investment bankers may log as many as 70 to 100 weekly hours. Long hours can contribute to burnout. 

Salaries range from $61,000 to $137.000 plus. Finance professionals are driven by a lively, exciting, and challenging workplace with advancement opportunities and unlimited career opportunities around the world.

Finance career options

The finance industry is ever-growing for those who possess a finance degree and strong analytical and accounting skills. Explore your finance career options below and check out the best online finance master’s programs.

Accountant

Minimum degree level required: Bachelor’s

Salary expectations: $73,560

Good fit for individuals who: 

  • Are organized professionals
  • Are skilled at working with numbers
  • Possess strong analytical skills
  • Like collaborating with diverse clientele
  • Are current with accounting trends

Accountants assemble, examine, validate, and organize financial documents. They also monitor the organization’s cash inflow and expenditures and ensure the legalities of financial transactions. Accountants operate with integrity, comply with accounting control procedures, and resolve accounting discrepancies.

Actuary

Minimum degree level required: Bachelor’s

Salary expectations: $111,030

Good fit for individuals who: 

  • Are detailed-oriented professionals
  • Are organized and self-motivated
  • Possess strong project management skills
  • Possess advanced statistical analysis and database manipulation training

Actuaries investigate financial outcomes and risk. They also apply financial theory alongside math and statistical data to examine the uncertainty of events and reduce their organization’s risk. Actuaries assist top executives with preparation for risk management, strategic solutions, and company-wide growth.

Budget analyst

Minimum degree level required: Bachelor’s

Salary expectations: $78,970 

Good fit for individuals who: 

  • Possess advanced mathematical and analytical skills
  • Have strong knowledge of economic trends
  • Are well-versed in financial markets and banking
  • Are experienced in resource allocation 

Budget analysts prepare income statements, balance sheets, and cash flow statements. Additionally, budget analysts review the organization’s accounting documents, expenditures, and revenue. Budget analysts oversee payouts, resolve accounting issues, and generate regulatory reports.

Chief financial officer

Minimum degree level required: Bachelor’s 

Salary expectations: $137,390

Good fit for individuals who: 

  • Are results-oriented professionals 
  • Possess leadership and team-building skills
  • Have excellent communication skills
  • Have cash management, financial accounting, and corporate finance competencies

The chief financial officer (CFO) is the organization’s top-ranking finance executive, balancing expenditures and revenue, monitoring financial planning and analysis, and overseeing the company’s overall fiscal health. Additionally, CFOs manage cash flow along with the organization’s assets, mergers, and funding.

Corporate finance manager

Minimum degree level required: Bachelor’s

Salary expectations: $93,714

Good fit for individuals who: 

  • Have management consultative experience
  • Possess communication and organizational skills
  • Are proficient in math
  • Possess solid technical skills

Corporate finance managers identify the organization’s financial resources, evaluate and forecast financial earnings and risks, and offer investment recommendations. They also guide leadership on achieving targets, generating capital, and preparing legal records.

Credit analyst

Minimum degree level required: Bachelor’s

Salary expectations: $86,170

Good fit for individuals who:

  • Can communicate effectively with colleagues, superiors, and subordinates
  • Enjoy collecting and processing data
  • Like programming and writing software
  • Can evaluate information
  • Enjoy gathering information from resources

Credit analysts evaluate prospective borrowers’ eligibility for loan approval and repayment. They also evaluate credit data and financial records and generate reports for credit risk. Credit analysts validate financial and credit operations and collect debt for past due balances.

Economic analyst

Minimum degree level required: Bachelor’s

Salary expectations: $61,322

Good fit for individuals who: 

  • Are organized
  • Possess analytical thinking and problem-solving skills
  • Have programming expertise
  • Possess statistical and database software experience

Economic analysts study economic trends and develop forecasts about the economy. Additionally, economic analysts use their math and programming knowledge to gather financial data and predict financial outcomes. Economic analysts perform microeconomic analyses and determine the best times to invest the organization’s assets.

Financial analyst

Minimum degree level required: Bachelor’s

Salary expectations: $83,660

Good fit for individuals who: 

  • Are analytical and strategic thinkers
  • Have excellent presentation skills
  • Are technologically proficient
  • Are detail-oriented

Financial analysts research business and economic trends, analyze financial records, and define the organization’s value. Financial analysts also explore the organization’s financial projections, weigh the leadership team’s capacity, and propose assortments of investments.

Financial examiner

Minimum degree level required: Bachelor’s

Salary expectations: $81,430

Good fit for individuals who: 

  • Possess strong analytical skills
  • Are detail-oriented
  • Are proficient in math, economics, and accounting 
  • Have experience with compliance software 

Financial examiners evaluate the organization’s profits and losses along with their assets, equity, and liabilities. Additionally, financial examiners guarantee compliance with governing laws for financial institutions and form guidelines that abide by the most improved and latest regulations. Financial examiners generate reports of the organization’s safety and soundness.

Financial manager

Minimum degree level required: Bachelor’s

Salary expectations: $134,180

Good fit for individuals who: 

  • Are proficient in math 
  • Possess strategic and analytical skills
  • Have strong oral and written communication skills
  • Have commercial awareness
  • Possess problem-solving skills 

Financial managers monitor assets of large-scale and small-scale organizations. Additionally, financial managers and their team members manage accounting processes and prepare fiscal reports, cash flow statements, and profit and loss forecasts. Financial managers adhere to laws and regulations and assist employees with understanding the organization’s reports.

Financial planner

Minimum degree level required: Bachelor’s

Salary expectations: $64,993

Good fit for individuals who: 

  • Are knowledgeable about personal finance
  • Have budgeting and investment experience
  • Possess analytical skills
  • Have debt management experience

Financial planners assist clients with investing, retirement savings, and maintaining wealth. These professionals also develop and monitor financial programs for employee benefit packages. Financial planners may specialize in niche areas such as estate planning, risk management, and tax planning.

Insurance agent

Minimum degree level required: Bachelor’s

Salary expectations: $52,180

Good fit for individuals who:

  • Possess strong customer service skills
  • Have sales and marketing experience
  • Possess solid math and critical thinking skills
  • Are knowledgeable about legal codes and laws 

Insurance agents market health, long-term care, life, and property and casualty insurance along with several other insurance types. They also review insurance policies, personalize insurance plans, and maintain policy renewals with new and existing clients.

Investment banker

Minimum degree level required: Bachelor’s

Salary expectations: $101,237

Good fit for individuals who: 

  • Possess analytical and numerical skills
  • Have interpersonal Skills
  • Are well-versed in financial markets
  • Have a background in investment trading 

Investment bankers raise capital for an organization’s expansion and improvement efforts. Investment bankers also negotiate mergers, arrange bond offerings, and organize confidential placement of bonds. Investment bankers crunch numbers and effectively communicate with financial institutions.

Loan officer

Minimum degree level required: Bachelor’s

Salary expectations: $63,960

Good fit for individuals who: 

  • Are data-driven and organized
  • Are accountable and responsive
  • Possess excellent communication skills
  • Welcome and encourage questions

Loan officers communicate with applicants to assess their needs for loans. Additionally, loan officers discuss loan options and terms, respond to applicants’ questions, and review financial documentation. Loan officers approve or deny applications, examine loan agreements, and adhere to federal and state regulations.

Management analyst

Minimum degree level required: Bachelor’s

Salary expectations: $87,660

Good fit for individuals who: 

  • Are accounting professionals
  • Have auditing experience
  • Possess analytical and communication skills
  • Have a background in computer systems analysis

Management analysts evaluate financial records such as profits, costs, and employment reports. These professionals also propose organizational changes, methods, and systems. Management analysts interview staff and administer in-person observations to assess the organization’s needs.

Personal finance advisor

Minimum degree level required: Bachelor’s

Salary expectations: $89,330

Good fit for individuals who: 

  • Have a background in accounting and economics 
  • Possess math and analytical skills
  • Are good at public speaking 
  • Have sales experience

Personal finance advisors communicate with clients and ascertain their income, costs, and insurance coverage while assessing their financial goals and risk tolerance. Additionally, personal finance advisors develop financial plans, oversee clients’ portfolios, and provide cash management and investment planning strategies.

Portfolio manager

Minimum degree level required: Bachelor’s 

Salary expectations: $89.286

Good fit for individuals who: 

  • Are leadership Professionals
  • Are goal-oriented
  • Possess analytical and quantitative skills
  • Exhibit initiative 

Portfolio managers invest mutual, closed-end funds or exchange traded holdings. They also institute investment plans and monitor daily portfolio trading. Portfolio managers develop investment strategies and determine best times for purchasing and selling assets.

Quantitative analyst

Minimum degree level required: Bachelor’s

Salary expectations: $83,660

Good fit for individuals who: 

  • Are economics and accounting professionals
  • Possess statistical and complex problem-solving skills
  • Have expertise in computers and electronics 
  • Are good critical thinkers

Quantitative analysts apply math techniques to assist organizations with business and financial decisions. Quantitative analysts also determine lucrative investment opportunities and minimize risk. Quantitative analysts evaluate cost effectiveness and benefits of the organization’s developments, products, and services.

Risk specialist

Minimum degree level required: Bachelor’s

Salary expectations: $83,660

Good fit for individuals who: 

  • Possess analytical or scientific software skills
  • Have financial analysis and word processing software skills
  • Are good problem-solvers and project managers
  • Pay attention to details

Risk specialists investigate potential risks that could reduce cash flow and increase the organization’s insurance rates. They also develop strategic plans to lessen the organization’s losses. Risk specialists examine financial records, design risk assessment models, and institute contingency plans.

Trader

Minimum degree level required: Bachelor’s

Salary expectations: $131,000

Good fit for individuals who: 

  • Are analytical professionals
  • Are excellent at product sales
  • Enjoy working with financial data
  • Are detail-oriented
  • Possess solid customer service skills

Traders purchase and sell securities such as stocks and profits to generate revenue. These professionals may work for large-scale investment management firms, banks, or exchanges. Traders are typically hired by hedge funds or partnerships investing in stocks, currencies, and other investment options. 

Venture capitalist

Minimum degree level required: Bachelor’s

Salary expectations: $192,525

Good fit for individuals who: 

  • Are detail-oriented
  • Have excellent decision-making skills 
  • Are excellent notetakers
  • Have experience in the financial sector
  • Are proficient in locating new profit opportunities

Venture capitalists supply investments at various stages of the venture process. These professionals are also private equity investors that allocate capital to organizations with strong potential to generate large financial gains. Venture capitalists provide capital for startup companies and small businesses seeking to expand their products and services.

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A check on insurance policy can help home based businesses make sure they’re covered

A check on insurance policy can help home based businesses make sure they’re covered

When Ana Maria Moreno decided to leave her career in social work to start a home-based business last year, she found herself facing a daunting to-do list that included everything from logo design to marketing strategy to customer outreach.

The Calgary woman — who runs her business out of her own kitchen, making and selling empanadas and other traditional foods from her native Colombia — acknowledges checking her insurance policy was the farthest thing from her mind.

“I didn’t think about it. I had all these people telling me I need to advertise, I need a logo, I should work on a trademark. It was a lot,” Mereno said. “I was just busy cooking food. I definitely didn’t think of everything.”

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Working from home for the foreseeable future? It could impact your home insurance

There are thousands of home-based businesses in Canada, running the gamut from hair salons to consulting firms to daycares — many run by first-time business owners.

Experts say new business owners should be aware that the typical home insurance policy offers only a small coverage limit for books, tools and instruments necessary for a business or profession. But it’s easy for entrepreneurs to get so caught up in the day-to-day demands of their new enterprise that they never even think about insurance, said Patricia Sheridan, Toronto-based director at insurance brokerage Burns & Wilcox.


“We see it a lot. I think a lot of the time it just does not occur to them,” Sheridan said.

“It’s typically not the first thing on people’s minds when they’re starting up a business.”

Not every home-based business operator will require specialized insurance coverage. Depending on the type of business, home-based business operators may or may not require a separate business insurance policy or an extension to their existing homeowners’ policy.

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‘I am concerned.’ B.C. wildfires could lead to higher home insurance rates

But it’s worth a phone call to find ask, Sheridan said. The last thing any business operator wants is to find out too late that their homeowners’ policy doesn’t allow for their specific type of business activity on the premises.

“The implications are that if they don’t have any other coverage for their business, and they think they’re just covered under their homeowners’ policy, their homeowners’ policy might cancel them if they find out about it,” Sheridan said. “Or if there is a claim they might not cover it.”


Anne Marie Thomas, director of consumer and industry relations with the Insurance Bureau of Canada, said individual business insurance needs vary widely.

“If you’re a one-person operation knitting tuques for babies, then the liability risk for the business is minimal. It’s you and some knitting needles and some wool,” she said. “But if you’re having a business where you’re having clients coming in and out of your home, that’s an increased liability risk for the insurance company.”

One scenario that should be considered by every home-based business operator include the possibility of a client falling and injuring themselves walking up the steps to the home. Another is the risk of being sued because of a problem with a product or service provided by the business. Personal liability on a home insurance policy wouldn’t cover these situations, but commercial liability insurance would.

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Omicron and travel: What new restrictions mean for refunds and insurance

Some home-based entrepreneurs may also have thousands of dollars worth of products or inventory sitting in their basement. That’s worth talking to your insurance company about, Thomas said.

Any business that involves building or manufacturing something within the confines of a home could also present liability concerns, Thomas added.

“To go to an extreme, if you’re building firecrackers in your home, that’s something where an insurance company is probably going to say, ‘I don’t think so,’” she said.

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The CPP earnings cap is increasing at the fastest rate in 30 years. Why and what it means

Every business and every insurance policy is unique, so that’s why it’s important for new entrepreneurs to talk to their brokers and be up-front about their specific situation and needs.

Thomas recommends home-based business operators touch base with their insurance representatives as soon as the business is launched, and that they keep in touch regularly as the business grows and evolves. Having a comprehensive risk management plan in place doesn’t have to be a complicated process, and can provide necessary peace of mind, she said.

“With insurance, it’s better to have it and not need it, then to need it and not have it,” she said.

© 2021 The Canadian Press

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Tensions Grow Over Ukraine With the Trading of Threats | Business News

Tensions Grow Over Ukraine With the Trading of Threats | Business News

By ELLEN KNICKMEYER and VLADIMIR ISACHENKOV, Associated Press

WASHINGTON (AP) — U.S. Secretary of State Antony Blinken met face-to-face with his Russian counterpart on Thursday to demand Russia pull back troops from the border with Ukraine, as tensions and suspicions grow in a confrontation over Ukraine’s increasingly close ties with NATO and the West.

Russia on one side and Ukraine, the U.S. and its NATO allies on the other traded fresh accusations and threats. The West, fearing that Moscow could invade Ukraine, threatened the Kremlin with the toughest sanctions yet if it launches an attack. Russia, seeing new U.S. and European support for Ukraine’s military, sternly warned that any presence of NATO troops and weapons on Ukrainian soil represents a “red line.”

Fears that Russia would invade its neighbor or seek to undermine the government of Ukrainian President Volodymyr Zelenskyy have dominated Blinken’s travels this week to meet with European allies.

Blinken and Russian Foreign Minister Sergey Lavrov met Thursday on the sidelines of a ministerial meeting of the Organization for Security and Cooperation in Europe in Stockholm, Sweden.

Political Cartoons on World Leaders

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“The United States and our allies and partners are deeply concerned by evidence that Russia has made plans for significant aggressive moves against Ukraine, including efforts to destabilize Ukraine from within and large-scale military operations,” Blinken told reporters.

During his meeting with Blinken, Lavrov charged that the West was “playing with fire” by denying Russia a say in any further NATO expansion into countries of the former Soviet Union. Zelenskyy has pushed for Ukraine to join the alliance, which holds out the promise of membership but hasn’t set a a timeline.

“I want to make it crystal clear: Turning our neighbors into a bridgehead for confrontation with Russia, the deployment of NATO forces in the regions strategically important for our security, is categorically unacceptable,” Lavrov said he told the OSCE meeting.

The United States and its European allies have struggled to warn Russia off any military action and reaffirm support for Ukraine without moving so forcefully as to give Russian President Vladimir Putin a pretext to invade.

American officials and their allies acknowledge the uncertainties, including whether Putin is prepared to invade Ukraine or is maneuvering to bring President Joe Biden into one-on-one talks on security concessions.

Putin said Wednesday that Moscow would seek Western guarantees precluding any further NATO expansion and deployment of its weapons near Russia’s borders. Lavrov followed up on Putin’s call for a new security arrangement, stating that reaching an agreement on a set of “long-term and legally binding security guarantees is imperative to prevent sliding into a confrontational scenario.”

Alexander Vershbow, a former U.S. ambassador to Russia and former deputy secretary general of NATO, said he sees little or no prospect of the U.S. or NATO providing Putin with such guarantees. “He’s simply not going to get” an agreement to rule out further NATO expansion, Vershbow told The Associated Press.

Vershbow also ruled out the U.S. or NATO agreeing to halt the kind of military assistance they have been providing to Ukraine since 2014, including arms, training and intelligence sharing.

Russia and Ukraine have remained locked in a tense tug-of-war since Russia annexed Ukraine’s Crimean Peninsula in 2014 following the ouster of the country’s Kremlin-friendly president and threw its weight behind a separatist insurgency in eastern Ukraine, which has killed more than 14,000.

Vershbow said Russia would not have an easy time if it chose to invade Ukraine, whose military is better equipped and more capable than it was in 2014. “It would be very costly for the Russians in terms of casualties,” he said.

Ukraine and the U.S. estimate that Russia has at least 90,000 troops on its border with Ukraine, while Russia charged this week that Ukraine has amassed about 125,000 troops, or about half its military, near the rebel-controlled areas in the east.

Addressing the OSCE meeting, Blinken urged Russia “to respect Ukraine’s sovereignty and territorial integrity to de-escalate, reverse the recent troop buildup” and “return forces to normal peaceful positions.”

The Kremlin has voiced concern that Ukraine may use force to reclaim control of the rebel east. And adding to the tensions, the head of a Russian-allied, self-proclaimed separatist republic in the east appeared on Russian state television to say that he could turn to Moscow for military assistance if the region faced a Ukrainian attack.

Ukrainian officials have denied an intention to reclaim the rebel regions by force.

Blinken sought Thursday to pre-empt Russian claims that Ukraine was threatening Russian interests. “Ukraine is in no way posing a threat to Russia or seeking a confrontation that would justify a Russian military intervention,” the American secretary of state insisted.

Blinken also met separately with Ukrainian Foreign Minister Dmytro Kuleba. Kuleba tweeted afterward that Ukraine and the United States “are closely working together on developing a comprehensive deterrence package, including severe economic sanctions, to demotivate Russia from further aggressive moves.”

John Herbst, a former U.S. ambassador to Ukraine, said Thursday that Putin appeared to be “testing Ukraine. He’s testing the West.”

Herbst, in a discussion at the Atlantic Council think tank, argued the Biden administration’s response has been strong so far, leaving Putin “hoping now simply to get some sort of concession either from Ukraine or perhaps from the United States.”

“Putin is definitely as serious as he could be” in the standoff, countered Ukraine analyst Hanna Shelest.

Isachenkov reported from Moscow. Robert Burns in Washington, Jan M. Olsen in Copenhagen, Denmark, and Yuras Karmanau in Kyiv, Ukraine, contributed to this report.

Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Library grant to bolster personal finance collections | News

Library grant to bolster personal finance collections | News

The Haywood County Public Library plans to expand its personal finance collections following the receipt of a grant from the FINRA Investor Education Foundation (FINRA Foundation).

The additional resources will help ensure that residents have the information they need when making critical money decisions as they repair, rebuild and clean up.

“When disaster strikes, the community comes together,” said Library Director Kathy Vossler. “The Haywood County Public Library provides residents with unbiased information to guide financial choices that will have lasting impact.”

Filing claims, accessing government resources, managing lump-sum payments from insurance companies and meeting immediate expenses when income might be disrupted — these are just a few of the money challenges that residents in disaster areas must navigate.

FINRA Foundation President Gerri Walsh noted, “Many of us lack experience with these decisions. Nonetheless, we have to get it right the first time around or face long-term financial consequences. Fortunately, the Library has information that can help.”

The expanded personal finance collections at the HCPL are made possible by a $5,000 grant from the FINRA Foundation. For nearly 15 years, the FINRA Foundation has provided funding, staff training and programs to build the capacity of public libraries to address the financial education needs of people nationwide. Much of this has been accomplished in partnership with the American Library Association through a program known as Smart investing@your library®.

It is estimated that consumer financial fraud costs Americans more than $50 billion a year, according to FINRA Foundation research. Financial fraud is especially prevalent following major natural disasters. Since it was established in 2005, the National Center for Disaster Fraud, which is part of the U.S. Department of Justice, has logged more than 220,000 disaster-related complaints from all 50 states. Financial fraud makes tough times all the more difficult for people recovering from the trauma inflicted by disasters.

Walsh observed, “Recovery follows disaster, but the path to recovery can be smooth or very bumpy. And financial fraud can be one of the biggest potholes along that road. The Haywood County Public Library has information to help people avoid the financial potholes and bring the route to recovery into sharper focus.” As a result of the grant, the Library is adding both print and digital materials to all branch collections.

The FINRA Foundation supports innovative research and educational projects that give Americans the knowledge, skills, and tools to make sound financial decisions throughout life. For more information about FINRA Foundation initiatives, visit finrafoundation.org.

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4 things to cheer as Omicron makes its dramatic entrance: Morning Brief

4 things to cheer as Omicron makes its dramatic entrance: Morning Brief

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Thursday, December 2, 2021

‘The economic impact of COVID seems to be diminishing’

The Omicron variant of COVID-19 made its first domestic appearance on Wednesday, with one recorded case, a person who had traveled to South Africa and mildly symptomatic, being found in California. The news was enough to send stocks into a tailspin — again — and stoke new fears about efforts to contain the virus’ spread (i.e. mandates, restrictions and, perchance, more lockdowns).

“What a difference a week makes. A week ago stocks were at all-time highs and the economy was strong. Now all we have are uncertainties and questions,” explained LPL Financial Chief Market Strategist Ryan Detrick.

“As of now we’re optimistic that stocks will sidestep the new variant worries, but we recommend investors buckle up their seatbelts, as the end of 2021 could be a bumpy one.”

Since the new mutation made its inauspicious debut, the market has recorded more days in the red than otherwise, even though economic data like November ADP private payrolls data continue to defy gravity.

“The mapping from the virus to the lockdown to the macro world has been diminishing,” S&P Global Ratings chief economist Paul Gruenwald told Yahoo Finance Live on Wednesday. “That doesn’t mean we can’t get a shock. Omicron is gonna be a new shock… the good news is the economic impact of COVID seems to be diminishing.”

Still, it can’t be denied that growth remains firmly in an uptrend. And in the spirit of the season, the Morning Brief thinks it’s a worthwhile exercise to point out the myriad ways in which the U.S. economy, despite all odds, is very much firing on all cylinders.

Jobs are more than plentiful. The ADP data showed private sector employment jumped by 534,000 last month, better than most Wall Street estimates, while the employment component of the ISM’s manufacturing gauge showed job creation is still on a tear. That sets the stage for Thursday’s jobless data, which last week set a 52-year trough, and Friday’s all-important jobs report.

Wages are still going up — which means consumers are still willing to spend, spend — and spend some more. COVID-19 has put a damper on consumer sentiment, but that mood isn’t being reflected in high-frequency data. In fact, it’s making people more willing to ring up purchases on credit cards, as Yahoo Finance’s personal finance chief Janna Herron wrote on Wednesday — and a point the Morning Brief also made recently. It also provides us with a reminder that the inflationary pressures we’re experiencing are (for lack of a better phrase) a high-class problem created via a combination of implacable demand from rising pay and pent-up spending from 2020’s COVID-19 lockdowns.

Fourth quarter growth is tracking higher after a Q3 letdown. With consumer spending robust and manufacturing and construction figures also surprising to the upside, ING Chief International Economist James Knightly is expecting a Q4 growth print of at least 6{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}. “Inflation is likely to record a similar reading, meaning the case for swifter Fed policy tightening is strong. Omicron permitting,” he wrote.

Oil is cratering. Whatever Omicron brings next, one critical element of soaring inflation — energy prices — has suddenly turned disinflationary with crude tumbling nearly $20 from a multiyear high set in October to under $65 per barrel. In fact, you could almost make the case that oil price action suggests crude is getting way oversold, as Yahoo Finance’s Brian Sozzi reported on Wednesday, citing a Goldman Sachs analysis. Yet another high-class problem to have.

By Javier E. David, editor at Yahoo Finance. Follow him at @Teflongeek

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