The Weekly Scan September 12, 2022

Welcome to the Weekly Scan. Here’s what we’re following for the week of September 12, 2022. Plus, our Certified Financial Planner™ Lauren Anastasio gives advice on how to respond to the news.

Lauren’s take on the markets: Despite historically being the worst month of the year for market performance (also dubbed “The September Effect”), this September has shown promise–all three major indexes ended up about 2% last week. For those following The Stash Way^® and focusing on the long term, you’ll be pleased to hear that the long-term impact to portfolios was minor, even when past Septembers resulted in negative returns. 

August heat. In August, the U.S. added 315,000 jobs, well below the 526,000 added in July, according to the Department of Labor. Still, the number of new jobs beat out expectations. Meanwhile, the unemployment rate increased to 3.7% from 3.5%, month over month. The labor participation rate also increased by 0.3 percentage points to 62.4%. Professional and business services, along with  the healthcare industry, experienced the biggest increases in job openings. 

• Lauren’s take: Job numbers give us insight into the economy. August numbers were strong enough to alleviate fears of a recession, but not so powerful to imply that the Fed’s rate hike efforts are not helping combat inflation. 

CNN

Apple wants you to try 5G. Apple held its annual event last week, where it revealed its latest iPhone model. The iPhone 14 is the third version of the smartphone with 5G technology, which reportedly improves the download time. Apple added safety features, such as sensors, that can detect car crashes and contact authorities. Although many expected Apple to increase prices for the iPhone, the company is maintaining the same price for the base and high-end versions of the phone, and is reducing the price of the iPhone Mini. In 2021, the revenue from the iPhone increased 39% and is predicted to increase another 6.7% this year. 

• Lauren’s take: Apple’s decision to keep prices consistent for the new model, and even lower for the mini, could be just one of many consumer-friendly moves. Retailers are hyper aware of how budget-conscious Americans have become after months of high inflation and will likely be creative as they compete for the dollars consumers are still spending during this time. 

Wall Street Journal

Another car company joins the electric race. Jeep announced that it’s planning to release four new all-electric SUVs in North America by 2025. The carmaker also said it expects half of U.S. sales and all European sales to be from all-electric cars by 2030. As part of this plan, Jeep will make an electric car similar to the Wrangler (called the Recon), and one similar to the Grand Wagoneer (known as S). Those cars are expected to go into production in 2024. Jeep had previously been focused on hybrid vehicles, but this latest plan indicates Jeep’s—and the car industry’s—growing interest in electric vehicles. 

• Lauren’s take: More manufacturers in the EV space are great for anyone hoping to make the switch in the next few years. More manufacturers in the space means a wider variety of EV models at more affordable price points, increasing accessibility for the masses, and lowering ownership costs. It’s a win-win. 

CNBC

It’s showtime. London-based movie theater chain Cineworld, which owns Regal Cinemas in the U.S., filed for Chapter 11 bankruptcy in the states last week. Cineworld is the second-largest movie chain in the world, behind AMC. In its filing, Cineworld reported $8.9 billion in debt at the end of 2021, including $4 billion that originated from lease liabilities. The company reportedly took on some of that debt during the pandemic to  survive lockdowns that prevented people from going to theaters. The company plans to restructure, and has $1.94 billion in debtor-in-possession financing to keep things running. 

• Lauren’s take: Bankruptcy is certainly not a word that inspires confidence, but it will help investors to remember that many large companies emerge from bankruptcy and  can become profitable again. Marvel Entertainment, Six Flags, and Texaco are just three examples of companies that filed Chapter 11 and came out successful on the other side.  

New York Times