Apparently, no matter how often Fed week comes, I still get excited about it. We will see and hear the Federal Reserve Open Market Committee report on Wednesday afternoon, and for the first time in a long time, we don’t have clear guidance about what is going to happen to interest rates. 90% of traders expect a rate cut, but as of the last Fed meeting, there was still disagreement among Fed Governors.
Due to the governmental shutdown lasting into November, there is very little employment and inflation data available that covers that month. We got no November jobs report on Friday, and the Personal Consumption Expenditures Price Index (PCE) showed inflation at 2.8% annualized – for September. There will apparently be no PCE for October and November. Lack of data is hindering the Fed’s ability to reach a consensus on what to do about interest rates.
Stock prices rose last week, leaving the major stock indices near record highs. Fears of an AI bubble have calmed, while anticipation of an interest-rate cut from the Fed buoyed investors.
Prices for bonds also rose, albeit slightly, bringing the yield on the ten-year Treasury Note up to 4.139%. (Bond prices and yields move in opposite directions.) Some of this movement is in sympathy with Japan, whose central bank is expected to raise interest rates when it meets next week. Japan, whose economy has been in the doldrums for decades, is finally seeing signs of life necessitating a rate hike to bring down inflation. The U.S. would also be raising interest rates if inflation were the Fed’s only mandate, but it is also responsible for keeping full employment, and the answers to these two issues are the opposite of one another. Inflation needs rate hikes, while unemployment needs rate cuts. Traders are betting that a weakening jobs market will trump inflation.
According to payroll giant ADP, there were 32,000 jobs lost in the private sector in November. We at least have this private data, while government data is missing. Small companies of fewer than 50 employees lost 120,000 jobs, while larger companies were hiring. Overall, there have been an estimated 1.1 million layoffs this year so far.
The odds of getting hired right now are 0.4%, based on the average number of applicants per job opening last quarter. (Business Insider). Maybe these job seekers should apply to Harvard instead? Its acceptance rate is 3.6%.
This (not the Harvard thing, but before that) may explain why although Nvidia stock is up 35% in 2025, it is being beaten by Dollar Tree and Dollar General, whose stocks rose 55% and 65% this year so far, respectively.
The shield that contains the nuclear fallout from Chernobyl was apparently damaged by a Russian drone strike in February – according to Ukraine. And in a related story, one of the reactors at the Three Mile Island nuclear power plant is being restarted, to provide electricity to Microsoft data centers. It is a reactor that was not damaged by the nuclear accident but was subsequently shut down anyway. According to the Wall Street Journal, local residents are split between those who fear another breach and meltdown, and those who are excited for new jobs.
For the week ending on December 5th, the Standard & Poor’s 500 finished at 6,870, the Nasdaq Composite Index at 23,578, and the Dow Jones Industrials at 47,954. The yield on the ten-year Treasury rose slightly to 4.139%. U.S. crude oil cost $59.54 per barrel, as the average price of gasoline fell to $3.00 for the first time in four years. N.Y. gold cost $4,198.00 per ounce, and one Euro was worth $1.16.
Elizabeth E. Cook
Partner, Diastole Wealth Management
News and information presented here was gathered from sources believed, but not guaranteed, to be reliable, including (but not limited to) Barron’s, The Wall Street Journal, USA Today, Yahoo Finance, Bloomberg, CNBC, Axios, Business Insider, The AP, 1440 Digest, Reuters, the Bureau of Labor Statistics, Morning Brew, The Hustle, CNN, and Interesting Engineering. If you have questions, please call Diastole at 203.458.5220, or write to me, Liz Cook, at ecook@dwinvest.com.
If you thought origami was just for pretty pastel paper cranes, you need to learn that it is one of the cutting-edge tools in a modern engineer’s or mathematician’s toolbox. Case in point: 14-year-old Miles Wu of New York has been folding origami forms for six years and just won a $25,000 prize for a creation of Miura-ori origami with can hold up to 10,000 times its own weight. He thinks that his folded masterpiece has practical uses for disaster recovery efforts. “A problem with current deployable structures and emergency structures is, for example, tents are sometimes strong, sometimes they can compact really small, and sometimes they’re easily deployable, but almost never are they all three,” Wu said. “I found that Miura-ori was really strong, light, and folds down really compactly.” I bet HE gets into Harvard.