Social Security recipients will receive their largest raise in 40 years.
Following the CPI inflation report this morning, the Social Security Administration announced a 2022 Cost of Living Adjustment (COLA) of 5.9%.
The news may be encouraging for seniors counting on these payments to cover living expenses. But high inflation for important categories like food, shelter and energy continue to make life challenging for many.
I’ll have more to say about inflation, retirement strategies and social security. Also, make sure you’re signed up to receive my Rich Retirement Letter in your inbox! (Follow the link and use the form on the home page.)
Today’s links include information on inflation, a kickoff to earnings season, Bitcoin signals, and some big concerns for coffee drinkers (like me!)
Links for Wednesday, October 13, 2021
- MW: Social security benefits to jump 5.9% in 2022.
- Biggest “raise” in 40-years.
- The average social security beneficiary gets $1,565 a month today.
- About 1/5 of the overall population receives social security.
- CNBC: Consumer prices rise more than expected.
- CPI up 0.4% in September, up 5.4% for last year.
- Ex food & energy up 0.2% in September, 4.0% for last year.
- Shelter prices are weighted heavily – up 0.4% for month, 3.2% for year.
- Another data point showing inflation is not “transient”.
- JPM Kicks off earnings season with 24% profit hike.
- Much of the gain came from a reduction in loan loss reserves.
- Spending on Chase consumer credit cards rose 30%.
- Mortgage originations up 43%.
- MW: Small businesses frustrated by labor shortages.
- Small biz confidence dropped to 6-month low.
- Shortages of supplies and skilled labor.
- more than 50% of small businesses couldn’t fill open positions last month.
- Bitcoin – signals point to higher prices (Glassnode).
- Boost in network activity – shows new demand entering market.
- Typical coin value of transactions has increased (institutional capital flows).
- Supply held by long-term holders increasing.
- Coindesk: Bitcoin mining profitability rose last few weeks.
- MARA up about 64% last 3 months.
- Souring mood following Jamie Dimon “worthless” comments.
- Reuters: JPM’s Jamie Dimon says bitcoin is worthless.
- Dimon says cryptocurrencies will be regulated.
- This summer, JPM gave wealth management clients access to crypto funds.
- Coindesk: IMF views crypto as threat to global economy.
- Adoption of crypto as national currency carries significant risks.
- Could hamper central banks efforts to set monetary policy – destabilize economies.
- Also identified stablecoins like tether and USDC as potential threats.
- Reuters: Major coffee buyers face losses – Columbia farmers fail to deliver.
- Up to 1 million bags of Columbia coffee crop undelivered.
- Farmers renegotiating agreements as prices surge.
- Breakdown in the system for buyers who hedged for higher prices (losses on hedge but can’t buy coffee at agreed on prices).
- GMO – Classic signs of speculation – growth stocks with no earnings.
- More than half “growth stocks” have negative earnings.
- But these have dramatically outperformed in last few years.
- BBG: Semiconductor stocks at 200-day average.
- Supply chain concerns are causing chip stocks to trade lower.
- Testing the 200-day average — technical support that has held since May of last year.
- Earnings reports for big players start on Oct 20th & 21st.