Doom and Gloom for 2024? (bonds, market, companies, employment)

[mathjak107]

layoffs mean earnings expectations can be beat … profits can come from increased business or cutting expenses.
corporate profits and markets have not been joined at the hip most of the time

as much as we think higher profits lead to higher stock prices it really does not work like that .

markets are based on greed ,fear and perception not the here and now .

gains and corporate profits don't flow together more ofton than not.

in the book a random walk down wall street 548 nyse issues were tracked and analyed over 5 year periods and the results were the performance had no relationship between the technical and fundemental signals and the actual stock performance ..

ned davis research took another look at the relationship and going as far back as 1927 they found when profits rose more than:

20% the s&p returned a mere 1.3% in gains

10 to 20% saw 5.8% in gains

(-10% to + 10% in profits saw a 9.3% jump in gains

(-10%) to (-25%) drop in profits saw 28.6% gains

(-25%) and lower saw a -28% drop in share price.

[Johnny Wadd]

Originally Posted by ed06288

A large number of layoffs would be a reason to sell stocks, if that were to happen.

Ironically, layoffs usually improve stock prices for that particular company. Stockholders love to hear about layoffs for the individual companies they are invested in.

[Johnny Wadd]

The biggest thing impacting stock prices is forecasts! What is a company predicting for profit (or loss). The profit itself, could be billions and billions. But that is already factored into the current price of the stock. But forecasts...even if you are profitable if you miss that forecast in your quarterly report, or some unexpected event occurs (lawsuits, etc) your stock price will tank because the price is now perceived as overvalued.

[ed06288]

Well, maybe the market would shrug layoffs off. But I'm under the impression such a thing is not priced in. Wouldn't layoffs indicate some kind of stress in the economy? That blows a hole in the soft landing narrative.

No landing puts the S&P around 5400, soft landing around 4850, and a hard landing around 3700 (or lower.) Not that I'm gonna defend those numbers to the death, but that's the situation at hand.

[GWoodle]

Originally Posted by ed06288

Well, maybe the market would shrug layoffs off. But I'm under the impression such a thing is not priced in. Wouldn't layoffs indicate some kind of stress in the economy? That blows a hole in the soft landing narrative.

No landing puts the S&P around 5400, soft landing around 4850, and a hard landing around 3700 (or lower.) Not that I'm gonna defend those numbers to the death, but that's the situation at hand.

Layoffs could indicate some stress at the company. Consider Walgreens. They may close a number of stores. They may have overbuilt store sin the past. They can consolidate workers in pharmacist position. Store clerks & others could be let go. Same deal at Walmart in Chicago, closing all 4 stores in the city. All the theft takes it's toll.

With the layoffs you have 26 weeks of unemployment insurance. The new unemployed have this time to find something else to do. Maybe they don't have Walgreen or Walmart or Target to apply to. Could be difficult to find comparable jobs. Doubt if states could extend the unemployment pay beyond the 26 weeks.

For the investor may not want to buy anything retail until the layoffs pass. This could affect anything depending on consumer spending.

[mathjak107]

we had tons of layoffs during covid and yet we still can’t fill all the jobs available.we have 55 un filled jobs on all levels at just the company i do work for .

almost every business here has help wanted signs and ads.

the problem so far is everyone of quality that wanted to work is working . most of what is out there available are low quality and not desirable as an employee…..

many can’t speak english well , or can’t pass a back ground check .

many have poor work ethics and we haven’t touched upon their work skills even

[mysticaltyger]

Originally Posted by twinkletwinkle22

Election years are good for stock markets.
https://advisor.morganstanley.com/th...on%20years.pdf

Have not found (yet) this information for bond markets in election year

In general, that's true. But 2008 was an election year and the stock market did awful. So there are always exceptions.

[BigCityDreamer]

Originally Posted by reubenray

What is up with the doom and gloom reports for 2024? I saw several headlines warning of a major market crash next year. I did not read the articles as it may terrify me being I am retired and depend on my returns.

https://www.foxbusiness.com/media/us...crash-lifetime

https://finance.yahoo.com/news/sever...aBOghAnRlBbb6x

The stock market might crash, or it might not. It could go higher just like it did in 2023.

Or it might crash one month only to turn around and rally strongly the next month.

The question is - what are you going to do to prepare for any of these scenarios?

[txfriend]

Originally Posted by ed06288

A large number of layoffs would be a reason to sell stocks, if that were to happen.

We already have a voluntary turnover between 17% to 20% annually. Much higher if the company doesn't
support a healthy work-life balance.

Involuntary turnover is less than 5%, this number should be higher to cut the deadwood.

[BPt111]

In depth on layoffs

Latest List of Layoffs Over Last 3 Months:

1. Twitch: 35% of workforce
2. Hasbro: 20% of workforce
3. Spotify USA: 17% of workforce
4. Levi's: 15% of workforce
5. Zerox: 15% of workforce
6. Qualtrics: 14% of workforce
7. Wayfair: 13% of workforce
8. Duolingo: 10% of workforce
9. Washington Post: 10% of workforce
10. eBay: 9% of workforce
11. PayPal: 9% of workforce
12. Business Insider: 8% of workforce
13. Charles Schwab: 6% of workforce
14. Macy's: 4% of workforce
15. Blackrock: 3% of workforce
16. Citigroup: 20,000 employees
17. UPS: 12,000 employees
18. Deutsche Bank: 3,500 employees
19. Pixar: 1,300 employees
20. Salesforce: 700 employees
21. American Airlines: 650 employees

TIME is laying off 15% of editorial and sales departments.

January 2024 saw a total of 82,000 layoffs, the second worst January since 2009.

Meanwhile, the US just reported that 353,000 jobs were created in January.

The finance industry alone saw ~30,000 layoffs in January 2024 alone.

While layoffs were spiking last year at this time, they were exclusively in tech.

Now, just about every industry is laying off worker

The jobs being lost are higher-paying salaried positions. Government jobs, part-time jobs, and likely jobs that are miscounted because they are posted on multiple platforms. Companies have a strategy to post jobs that they have no intention of filling to keep resumes on file. Part-time employment is counted as a boost to the economy in reports, but many individuals nationwide are juggling 2-3 jobs.


Most of these tech layoffs offer 1-2 months of extra time on the payroll plus 2-6 month severance and 3-6 month free health insurance. As tech companies are still hiring, Thea tech workers find another job in 2-6 months and they never show up on the unemployment reports.

https://x.com/kobeissiletter/status/...QbM1s43DhfrK6w