Baby Step: US-China Trade Deal...

7-7 Market Highlights (December 8 – December 14, 2019) 

A first step into an uncharted territory is scary and confusing. Yet, there is an unparalleled excitement, suspicion, optimism, and apprehension as the US-China vacillate into taking that first trade step. Let’s hope that the first step instills confidence and resolution for the mutual and global benefit. The Phase One trade deal is about to be signed. Will it be OK? Will Xi change his mind again, or Trump levy tariff regardless? China needs this accord a lot more than America according to all the economic indicators and political predicaments. Meanwhile, the USA is treading into an unprecedented economic expansion in 50 years…   

12/13/2019: DOW-28,135; S&P500-3,168; NASDAQ-8,734; Gold-$1,480.30; Oil-$59.78;  US 10-Year: 1.824% 

Here are the highlights of the 50th week of 2019:  

1. Trade Deal? China and US reach phase one trade deal that includes some tariff relief and agriculture purchases. The two sides will work through the legal process and move to sign it as quickly as possible. Some details of the partial accord, which the world’s two largest economies will now move toward signing as they aim to rein in a boiling trade war, appeared murky. As Chinese officials briefed reporters on the details of the agreement Friday morning, President Trump also announced terms of what he called an “amazing deal.” The U.S. plans to scrap tariffs on Chinese goods in phases, a priority for Beijing, Vice Commerce Minister Wang Shouwen said. However, Wang did not detail when exactly the U.S. would roll back duties. Trump later said his administration would cancel its next round of tariffs on Chinese goods set to take effect Sunday. In tweets, he added that the White House would leave 25% tariffs on $250 billion in imports in place while cutting existing duties on another $120 billion in products to 7.5%.

2. Tariff 100% on EU Products?     US weighing 100% tariffs on more EU products including whiskies and Cognac, according to documents as the fallout of its high-profile dispute with Airbus. The U.S. has long argued that subsidies to Airbus hurt American aircraft giant Boeing and that the EU’s efforts to comply with prior WTO rulings against the subsidies aren’t enough to even the playing field. The Office of the United States Trade Representative on Thursday published a list of additional European goods it is now considering for the tariffs. Due to the EU’s failure to curb the subsidies, “the United States is initiating a process to assess increasing the tariff rates and subjecting additional EU products to the tariffs,” it added at the time. Though Trump has seen some success with his protectionist tactics — notably in a new NAFTA agreement with Canada and Mexico — they’ve also angered economic partners around the globe. The deadline for public comments on the USTR’s new tariffs is Jan. 13.

3. Rate Unchanged.   Max employment and price stability are on target according to FOMC Chair J. Powell. And “Unch” is a good sign of stabilizing economic environment…  As widely expected, the US Federal Reserve today announced that it would leave key short-term interest rates unchanged. As a result, the federal funds rate remains in a target range of 1.50%–1.75%. In recent weeks, Fed committee members have hinted that, after three cuts this year, rates may now be at an appropriate level for the Fed’s objectives of supporting the labor market and keeping inflation in line. The Fed’s decision to stand pat comes amid historically low unemployment, mild inflation, and continued (though moderating) economic growth.

4. Amazon, Most Important 2020s Company…           Amazon revenue in its core business, e-commerce, has increased sevenfold from an already massive base of $34.2 billion. Yet Amazon still has only 40% of the overall e-commerce market in the U.S., according to eMarketer, and far less worldwide, leaving plenty more upside. Over the last decade, Amazon has become one of the most powerful, respected and feared companies in tech and beyond. It got there by actually doing what other companies say they do: focusing relentlessly on customers and being willing to experiment, fail and learn. These habits will help Amazon conquer the 2020s, but as its power grows, so will the criticism.   

5. Millennials, 86% Overspent on Holiday Gifts.            This the season to shop, and a new holiday survey from American Express, it found that 86% of millennials (23 to 38) spent more money during the holidays last year than they planned to. Of those who overspent, about one in five (21%) went over budget by approximately $500 or more. Electronics (69%) were the most common gift that caused millennials to overspend, compared to children’s toys (57%), clothes (53%), jewelry (38%), food or drinks (33%) and other gifts (4%). Perhaps, consider these easy ways to curb your spending this year: 1) Make a budget, 2) Redeem credit card rewards, 3) Look for deals, 4) Avoid unnecessary purchases, and If you have a habit of buying things you don’t really need try to avoid split-second purchases. “Wait 24 hours before clicking ‘check out’ to give yourself a cooling off period,” says Lapin. “Put the item you’re looking at in your shopping cart, but don’t check out right away. After 24 hours do you still want it that bad?  Often, you’re more ‘meh’ about it the next day.”

6. The Fastest-Growing US Job Pays $136,000/Year.         The #1 job, Artificial Intelligence specialist: Average annual growth rate since 2015: 74%, Average pay: $136,000 per year. And, the fastest growing jobs are in San Francisco Bay Area, New York, Boston, Seattle, Los Angeles. Top industries hiring for this role: Computer software, internet, information technology and services, higher education, consumer electronics. According to LinkedIn’s emerging jobs list are within the technology, engineering and data science spaces.  The rest of the top paying and expanding jobs are, according to LinkedIn’s 2020 Emerging Jobs Report:   15. Product owner, 14. JavaScript developer, 13. Cloud engineer, 12. Chief revenue officer, 11. Back end developer, 10. Cybersecurity specialist, 9. Behavioral health technician, 8. Data engineer, 7. Sales development representative, 6. Customer success specialist, 5. Site reliability engineer, 4. Full stack engineer, 3. Data scientist, 2. Robotics engineer. Full article: https://www.cnbc.com/2019/12/11/linkedin-emerging-jobs-report-2020-fastest-growing-us-job-pays-136k.html    

7. A 102-Year Old’s First Album.        Alan R. Tripp is 102 years old, and he shows us how to live a long, productive. He published a first album. Well, so goes the chorus of “I Just Can’t Remember Your Name,” on the 10-track album, “Senior Song Book”. The lyrics are a humorous nod to a common pain point about aging. After all, the song’s writer, Alan R. Tripp, is 102. Well, Japanese longevity expert, Dr. Shigeaki Hinohara, who lived to be 105, also said the key to a long, happy life was to stay active. Stay active, productive… “For me, retirement is a fate worse than death,” she said to Money in 2018 after her book release. After her book release. “I’ve seen so many people, especially in a place like Palm Beach, who worked so hard in their lives, and they come down here cold turkey, and then one day wake up and they realize how vacuous their lives are now.” So, plan to be busy, productive, live a happy life into your 100s.

These are my researches and analysis of the highlights of the week. Perhaps you should take a closer look at them, do additional research and analysis if these are interesting to you. This “7–7 Market Highlights” is presented for general knowledge, the resource for management, and perhaps as a tool for career development, and building wealth. As always, “Stay Curious” and “Think for Yourself” and you decide on your own terms. 

Mahalo. I welcome your thoughtful comments, “like” notes, and “share” of this publication. 

~ S. Vincent Shin

    www.dhirubhai.net/in/vshin

References and Image credits to Bloomberg News, The Wall Street Journals, Getty image, AP Photo, Reuters, CNBC..., and special thanks to Image & Visual Consultant @U.Y. All references, news, and images are from open source and public domain.