On a scale of 1 to 10, how hopeful are you feeling about 2023?

We’ve seen A TON of headlines talking about recessions, layoffs, and market fears over the past few weeks.  And what we should be doing to stave off the worst.  It’s prudent to plan ahead and reef the sails before the storm strikes.

But are we going overboard?  Are we being TOO negative?

It's a normal human reaction to try to foresee and prepare for the worst.  But that can sometimes lead us to act as though the worst-case scenario is a foregone conclusion.

What if we're not making enough room for good things to happen?

While the risk of a recession next year is real, it's not a given — it’s one of many predictions.

The Wall Street Journal survey of economists puts the risk of a recession within 12 months at 63%.¹  On the other hand, Goldman Sachs puts the probability of a 2023 recession at just 35%.²

No one knows what will happen for certain, but it doesn't look like a recession is just around the corner.

Recent layoffs are getting big headlines, but they aren’t widespread.³

In fact, there's still a chance that we could avoid a recession or experience only a mild downturn. 

Especially if inflation has truly peaked.  (Fingers crossed!)

There are likely to be stormy waters ahead, especially for employees affected by layoffs, but as we enter the final weeks of the year, we want to highlight some signs of hope:

Hopeful sign #1: The latest data shows that the U.S. economy grew nearly 2.9% in the third quarter.⁴

Hopeful sign #2: Economists think the economy will grow again in the fourth quarter as well.

Hopeful sign #3: The Fed might slow down the pace of interest rate hikes soon.⁵

It’s true, we're still in challenging conditions as we approach 2023.   More volatility is very likely in store for us.  But let's make room for optimism and positivity.

Good things are in store as well.

Before we go, here’s a few more bits of good news from 2022:

• We learned that U.S. child poverty plummeted 80% between 1993 and 2021.⁶
• Scientists discovered a way to help identify babies at risk for sudden infant death syndrome.⁷
• Voters elected the first Gen Z member of Congress.⁸
• A record number of sea turtles laid nests on the Georgia coast.⁹

What other wonderful things happened this year?  What good news do you have to share with us?

Optimistically,
Your Eagle Wealth Team

If you’re planning on purchasing healthcare through the Health Insurance Marketplace, keep an eye on the open enrollment deadlines. 

The 2023 Open Enrollment Period runs from November 1, 2022, through January 15, 2023.  But if you need coverage to start by January 1^st, 2023, the deadline to enroll is this Thursday, December 15^th.   

Here’s a checklist of items to gather to complete your application.  (Hint: You’ll need your estimated modified adjusted growth income for 2023). 

Please give us a call if you have questions.  We’re happy to help.

Toys for Tots Box at Eagle Wealth

The Eagle Wealth Marine Toys for Tots box is starting to fill up, but we still need your help!  This national organization distributes toys to less fortunate children during the holiday season, spreading hope and joy to others. 
 
We’ll match every toy donated, so please join us in the fun!  Drop by our office with a (new and unwrapped) toy.  We’ll collect gifts until December 21st.
 
Click here for more information about the program.
 
P.S.  If you live outside of Central Oregon you can still participate.  Let us know if you make a donation locally and we'll put another toy in the box.

The Week on Wall Street

Recession fears and concerns that the Fed may consider a longer rate-hike cycle sent stocks lower for the week.

The Dow Jones Industrial Average dropped 2.77%, while the Standard & Poor’s 500 fell 3.37%. The Nasdaq Composite index lost 3.99% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, dipped 1.09%.^1,2,3

Stocks Slide

Stocks were under pressure much of the week due to resurgent recession fears and concerns that Fed rate hikes may go higher for longer than current expectations. There was some good news last week on the economic front and out of China, which started to loosen COVID restrictions. But it was a week where good news was considered bad news, as any signs of economic resilience stoked worries of a longer rate-hike cycle.

Higher continuing jobless claims signaled economic softness, triggering a Thursday rally. But stock prices were under pressure Friday following a disappointing Producer Price Index (PPI) number.

Producer Inflation Disappoints

The Labor Department reported that the PPI rose 0.3% in November and 7.4% from a year ago. Though wholesale prices inflation rose at the slowest 12-month pace since May 2021, they exceeded market expectations. Price pressures were felt most in the services sector, where costs rose 0.4% after a 0.1% increase the month before. Goods inflation eased to a rise of 0.1%, a sharp drop from its October gain of 0.6%.⁴

Though the PPI number dented the optimism around cooling inflation, November’s PPI report represented an improvement from its 11.7% peak in March.⁵