| | | | | | | Presented By Goldman Sachs | | | | Axios Markets | | By Dion Rabouin ·Dec 18, 2020 | | 😱 Heads up! This is my penultimate newsletter of 2020. Send any and all requests for what you'd like to see in my final newsletter of the year to dion@axios.com or find me on Twitter @DionRabouin. - Was this email forwarded to you? Sign up here. (Today's Smart Brevity count: 1,080 words, 4 minutes.)
🎙"Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction." | | | | | | 1 big thing: Unemployment surges as pandemic programs near expiration |  Data: U.S. Department of Labor; Chart: Andrew Witherspoon/Axios A little more than a week before the programs expire on Dec. 26, claims for pandemic-specific unemployment benefits are spiking with nearly 1 million new people receiving unemployment assistance via the temporary programs, the latest data from the Labor Department show. What's happening: As of Nov. 28, there were 14 million people receiving unemployment benefits through the PUA and Pandemic Emergency Unemployment Compensation programs, an increase of 958,000 from the previous week. - 1.4 million Americans filed unemployment claims for the first time last week, with 935,000 filing for traditional unemployment benefits and 455,000 filing claims for the Pandemic Unemployment Assistance (PUA) program.
What to watch: The White House and congressional leaders remain at odds on an approximately $900 billion coronavirus relief package that would extend the unemployment programs and it increasingly looks like the talks will drag into the weekend. The big picture: Unlike in previous weeks when the number of people receiving traditional unemployment benefits was declining and the number of Americans on long-term unemployment programs like the PEUC was rising, in the last week of November the numbers rose across the board. - The number of people receiving traditional unemployment benefits rose by 552,000.
- The number receiving PUA increased by 689,000.
- PEUC rose by 269,000.
- Extended Benefits rose by 79,000.
- In all, the number of Americans receiving unemployment benefits increased by 1.6 million.
- For the week of Nov. 28, 20.6 million Americans were receiving some kind of unemployment benefits
Make it plain: These numbers "really highlight the fragility of the labor market, particularly now as the second resurgence of the coronavirus [is] leading to further business closures and additional job losses," Lindsey Piegza, chief economist at Stifel, told CNBC. - More than 247,000 new COVID-19 infections were confirmed in the U.S. and data from the Atlantic's COVID Tracking Project showed a record 113,000 people were hospitalized with the virus.
Pay attention: The Labor Department's seasonally adjusted figures showed 885,000 initial applications for unemployment benefits, 50,000 fewer claims than the unadjusted numbers. - The Labor Department has said it agrees with a report from the Government Accountability Office that found its weekly releases "do not provide an accurate estimate of the total number of individuals actually claiming unemployment insurance."
|     | | | | | | 2. Catch up quick | | On global earnings calls between July 21 and Dec. 8, about one in eight transcripts revealed firms rethinking their real estate needs, with many on track to save millions of dollars. (Bloomberg) Coinbase announced that it had filed paperwork with the SEC for an IPO. (CNBC) New foreign investment into China is on track to set another record this year, having hit 94% of last year's record total by the end of November. (Bloomberg) An FDA advisory panel recommended the approval of Moderna's coronavirus vaccine for emergency use in a 20-0 vote with one abstention. (Axios) The U.S. Treasury is attempting to water down an executive order from President Trump barring Americans from investing in Chinese companies with suspected ties to the People's Liberation Army, unnamed sources said. (FT) | | | | | | | | 3. The dollar is close to hitting its weakest level in six years |  Data: FactSet; Chart: Axios Visuals The dollar fell sharply on Thursday against almost all of the world's major currencies, and the dollar index dropped to its lowest since April 2018. - The index, which measures the dollar against major currencies like the euro, yen and British pound, fell 0.7%, its fourth daily decline in a row and the fifth time in six sessions it has closed lower.
- It's approaching its weakest level since the dollar strengthening cycle began in 2014.
What they're saying: "The latest blow to the dollar came from the Fed, which vowed not to touch policy even if the outlook for the U.S. economy brightens as it now expects," Joe Manimbo, senior analyst at Western Union Business Solutions, told MarketWatch, adding that expectations for more government spending are also weighing on the greenback. Watch this space: Gold jumped by 1.7% to $1887.20 per troy ounce, its highest since Nov. 16, and silver gained 2.4% following a 3.8% increase on Wednesday and is now at $25.74 per troy ounce, the highest since Nov. 6. - The dollar index is down nearly 7% year to date and 13% lower since hitting its 2020 high in March.
On the other side: The Chinese yuan has gained significantly against the dollar this year and on Thursday moved to 6.53 yuan per dollar, its strongest against the dollar since June 2018. - The dollar also is trading at or near multiyear lows against major currencies including the euro, Japanese yen and Australian dollar.
- The euro rose through the psychologically important $1.22 level against the dollar early Thursday and could push through $1.25, analysts say.
| | | | | | | | A message from Goldman Sachs | | The future of the software sector | | |  | | | | Thoma Bravo's Orlando Bravo joins Goldman Sachs' Insights from Great Investors to discuss: - Why he began investing in software two decades ago.
- The resiliency of the software business model.
- Navigating the investing landscape throughout the pandemic.
Join the conversation. | | | | | | 4. BOJ to assess current programs as core inflation hits 10-year low |  Data: Investing.com; Chart: Axios Visuals The Bank of Japan extended its special support programs for businesses by six months and said it would "conduct an assessment for further effective and sustainable monetary easing" after Japan's core consumer prices fell at the fastest pace in 10 years in November. - November's core CPI decline beat out October's historic decline when consumer prices fell by what was then the fastest pace in 10 years.
By the numbers: Prices excluding fresh food fell 0.9% from a year earlier, and a larger drop in energy costs pushed the core index down further after October's 0.7% drop. - November was the fourth straight month the index has been negative.
- It was zero the two months prior and negative the two months prior to that.
- The core price index was last positive in March.
Where it stands: The BOJ plans to conduct an examination into why inflation remains far from its 2% target and is falling. - Before the meeting, BOJ governor Haruhiko Kuroda said he was not overly concerned about recent price declines because special factors including the impact of the government's discount campaigns to help the service sector are temporary and holding down inflation.
| | | | | | | | 5. IRAs now account for more than 1/3 of U.S. retirement assets |  Data: Investment Company Institute; Chart: Andrew Witherspoon/Axios There was $33.1 trillion tucked away in U.S. retirement assets at the end of the third quarter, accounting for 34% of all Americans' household financial assets, the Investment Company Institute reported this week. - Individual Retirement Accounts now make up more than one-third of all retirement accounts, as millions of Americans have rolled over their 401(k)s and other so-called defined contribution accounts into IRAs, ICI tells Axios.
What we're hearing: "Households often indicate that they rolled over assets to consolidate their retirement accumulations as they progress through their careers and into retirement," ICI senior director of retirement and investor research Sarah Holden tells Axios in an email. - "Rollovers have been a large part of the growth story for IRAs, particularly for traditional IRAs."
Of note: "Roth IRAs also have grown as some retirement savers have embraced the Roth tax treatment," Holden adds. "At year-end 2019, Roth IRAs had more than $1 trillion in assets and represented 9% of total IRA assets." | | | | | | | | A message from Goldman Sachs | | What's on the minds of some of the world's great investors? | | |  | | | | Each week, Goldman Sachs brings viewers an interview with leading private and public investors. Why it's important: Some of the world's greatest investors will provide insight on their investing philosophies and how they are approaching the new investing landscape. Explore their insights. | | | | Thanks for reading! Quote: "Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction." Why it matters: On Dec. 18, 1865, the 13th Amendment to the U.S. Constitution abolishing slavery was declared in effect by then secretary of state, William H. Seward. | | | | Axios thanks our partners for supporting our newsletters.
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