US labor market softens (18-year cycle)

Softly, softly...

US nonfarm payrolls increased by +150,000 in October, rather less than expected, and the preceding months were also revised down by a combined -101,000.

The participation rate ticked down, and the unemployment rate also rose to 3.9 per cent.

Source: BLS

Average hourly earnings increased by only +0.2 per cent, to be +4.1 per cent higher over the year.

Hardly a disaster, but suggests that the interest rate hikes have gone more than far enough, the way things are trending.

The first interest rate cut in the US is priced in for June, while rates are also looking peaky in Canada, the Eurozone, the UK, and New Zealand. 

Bond yields down sharply, stock futures UP!

---

This morning I interviewed Catherine Cashmore from Land Cycle Investor (a 75-minute live interview as part of my coaching program) and increasingly it seems many of these figures are lining up with her previous forecasts. 

In particular - as she previously predicted - after the anticipated mid-cycle slowdown, Aussie real estate is going into the boom phase of the cycle between now and 2026 (perhaps 2027 for Perth) due to a chronic dwelling shortage - while stocks will likely enjoy the steady decline in interest rates through late 2024 and 2025. 

Source: Fat Tail, Land Cycle Investor

I've been sceptical of some the implied timings of the 18-year cycle in the past, but when you dig into it there are some fascinating trends (so many of which seem to keep coming true).

Following on from Catherine's analysis, I'd be wary of buying into some of the more overheated regional property markets over the next year or two.

---

Foreign buyers are back, according to NAB's survey, which makes sense given record immigration and all-time low rental vacancy rates:

Source: NAB

---

P.S. Whenever you’re ready…here are 4 ways I can help you manage your own money and go next level wealth:

1. Boom or Bust in 2023 – 20 minute online workshop for investors

Register for my next free online training - Boom or Bust? How to change your investment plan for 2023 - book in here

You also download a free copy of my e-book The Only 6 Ways to Become Wealthy here.

2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is one of Australia's biggest business podcasts.

And our enormously popular Low Rates High Returns Show is also available on Spotify.

3. Subscribe for my free daily blog

Subscribe for my free daily blog with well over 3.4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm active daily and have over 13,000 followers. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here.