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US stocks down, Social Security payouts up, Wednesday markets flounder

Written By | Oct 13, 2021
US stocks down, social security payouts up,bulls or bears, NASDAQ recovery, McClellan Oscillator, purchased money market funds, bank sweep accounts, bank sweeps

Bull and bear. Public domain image via Pixabay.

WASHINGTON – Wednesday morning trading action found the Dow Jones Industrials (DJI) still on the downslope, while other market averages continued to flounder, albeit slightly in the green zone. That makes it 3 negative days in a row thus far for the DJI. Wednesday finds America’s big 30 list of stocks down consistently as negatives continue to pile up. Just in time for Q3 earnings season reporting. The only good news today was for the growing cohort of aging Boomers. For the first time in a long time, Social Security COLA benefits for retirees gains a a big increase in benefits in 2022.

Boomers rejoice: Social Security payouts up soon. Because, inflation…

That increase in Social Security payouts takes effect beginning next year, as the AP reports.

“Millions of retirees on Social Security will get a 5.9% boost in benefits for 2022. The biggest cost-of-living adjustment in 39 years follows a burst in inflation as the economy struggles to shake off the drag of the coronavirus pandemic.

“The COLA, as it’s commonly called, amounts to $92 a month for the average retired worker, according to estimates released Wednesday by the Social Security Administration. That marks an abrupt break from a long lull in inflation that saw cost-of-living adjustments averaging just 1.65% a year over the past 10 years.

“With the increase, the estimated average Social Security payment for a retired worker will be $1,657 a month next year. A typical couple’s benefits would rise by $154 to $2,753 per month.”

Caveat: Ignore the final third of that linked AP article

It’s full of the usual pro-left, highly partisan support we’ve come to expect from the AP. This time, AP’s staffers inject opinion into another news piece. This time, they pump the alleged benefits of “Biden’s” total-destruction “stimulus” plans. But they fail to inform readers that this would quickly rob SS recipients of any benefit they might gain from the first significant COLA increase they’ve seen since, oh, about 2008.

That’s something Innovative Income Investor guru Tim McPherson is careful to note in his link to the AP article.

“Of course in many cases increases in the cost of goods and services will eat up the large increase, but some of us adjust our cost of living when prices skyrocket so it is nice to get the large increase and then leave it up to us to spend it wisely. I will say it has been a long time since I have seen this type of increase to my income.

“Of course this all assumes the government has the money (which we know they really don’t) to pay out this increased amount.”

Thanks to Tim for both the link and his comments.

Also Read: Investing pendulum swinging for Mr Market. But which way next?

US stocks down, chipmakers struggle, following the negative pattern set by September’s downward drift

In news more specifically related to Mr Market, both stocks and major averages continue to meander Wednesday afternoon, making any prediction of today’s closing number an exercise in foolishness. In general, however, chipmakers in general and chip suppliers to Apple (NASDAQ:AAPL) in specific continue to warn that a continuing undersupply of in-demand chips still threatens to hit chipmakers’ bottom lines.

Ditto big chip users like Apple, which warned this morning that it might have to shave its current iPhone sales estimates. Without a predictable supply line, even mighty Apple can’t make enough phones to keep up with demand.

If you think about it, if Tim Cook and his supply-line geniuses at Apple can’t get enough product, imagine how this will work out elsewhere in the hardware universe.

Word is that one major constraint for chipmakers continues to involve “substrate.”

I.e., the stuff that chip circuitry sits on. Likewise, the same problem dogs manufacturers of circuit boards large and small. It’s a little bit like trying to pave a new superhighway, except that you can’t obtain asphalt or cement.

At any rate, this hit numerous chip stocks once again today. Users, too. Like Apple. It’s hard to say when this situation will end, but major Apple suppliers like Broadcom (NASDAQ:AVGO) and Texas Instruments (NASDAQ:TXN) took it on the nose when the news hit.

With chip stocks expensive on a per-share basis – like everything else in tech-land – this could prove an opportunity to dip into this falling sector via one- or two-share purchases. That’s now a viable option if you’re working with a no-commission brokerage house. We already own a dozen shares of Broadcom and intend to ride them at least for now. But we may also acquire shares of Apple and Texas Instruments here and there. Like everything else in today’s investing environment, it all depends. On… whatever.

We still live in uncertain times. Investors must remain informed on all levels

We wish we could be more specific, both for the sake of our own portfolios or yours. But healthy skepticism remains the best strategy right now. Making the wrong move now could cost all of us the nice profits we made earlier this year.

The sad thing is that, with the Covid vaxx / masking nonsense continuing and with the Marxist educational establishment continuing in its effort to indoctrinate our kids, the political situation in America continues down a path of bipartisan hatred and total confusion. All of which makes it tough to make rational investing decisions.

Investors wonder these days whether even the allegedly reliable P&L numbers coming out in this and successive quarters will prove any more reliable than the CDC’s latest contradictory reports or the bafflegab routinely spewed out at us by corrupt politicians and media hacks disguised as reporters.

Meanwhile, Boomers can rejoice, at least for now, that, with their Social Security payouts up in  2022, they might finally recover a portion of the COLA they never received during the Great Recession and its aftermath. But that’s another story.

Stay tuned.

Terry Ponick

Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Senior Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17