As weeks go, this is a monster week, but Halloween notwithstanding, there is no need to be afraid. At least not yet… There is plenty of action this week with earnings announcements from Apple, Microsoft, Amazon, Google & Meta We also have a PCE report (Fed favorite) and we end the week with an all important jobs report. All of this is coming just a few days before a close, contentious election that may be contested for days/weeks/months/years into the future. However, at the end of the day, inflation is dropping, the economy is rising (slightly), major companies are making money, interest rates are stabilizing and the sun will be shining in most places. The rest of the world, on a relative basis, is nowhere near the strength of the US. This is true on both a military and economic basis.

This should not suggest that there are no concerns or worries on the horizon. There is always something that we, as humans, or, as investors, can worry about. The long-term treasury bonds (10 year) have increased 50 basis points (past month), some company somewhere will have horrific earnings, and a member of the Federal Reserve will say something to make us all think that a future Fed meeting, either post election or pre Xmas, will fall short of our anticipated 2 additional rate cuts. Also, on balance, a week from today, at least 1/2 the country and much of the outside world, will be mourning some US election result. Irrespective of whoever wins, some large percentage of the population will be upset. These are all things that investors could, potentially, worry about. But it does not change the overall landscape, that from an economics perspective, here in the US, things are proceeding just fine.

From a macro point of view, things are actually pretty good. Interest rates are currently low (historical perspective) and very likely going to get lower. Most companies are still beating earnings expectations and the Mag Seven will likely continue to show evidence that they are performing well and growing both revenues and profits. The news is even better for companies just below the Mag Seven ($10B to $100B in market cap). Lately, they have been performing even better. Oil prices have been dropping (owing to the easing of tensions in the Middle East) and the jobs report will likely show that we are still a nation hiring a bunch of government, social service and health care workers. The latter point, regarding jobs, is actually a major problem, but in the short term most investors will ignore it until well after the election. And irrespective of whoever wins November 5th, people in California, our most populous state, will likely be celebrating an LA Dodgers World Series victory.

Yes, the last week of October and first week of November will probably be the impactful week remaining in 2024. But there is no need to worry. The stock markets are enjoying a strong year and seem to have sufficient momentum to end the year on higher highs. The rest of the world cannot say the same. Other global markets are suffering or, as in the case in China, may experience a quick growth spurt of 35% in less than 1 month, only to lose 1/2 in the subsequent 10 days. Our US markets are much more stable and, at least for the foreseeable future, a better place to be. Sure, investors can fret and complain, but taking all things into consideration, as Dorothy would say in the Wizard of Oz, “there is no place like home”.