What we’re reading (12/7)
“The November Jobs Report Is A Disaster” (New York Magazine). “U.S. employers added 245,000 jobs to their payrolls last month. Which is terrible news for the American economy. In a normal November, the addition of a nearly quarter-million new jobs would be a sign of economic strength. But 2020 is no ordinary year. The U.S. shed 22 million jobs in the first two months of the COVID-19 crisis. Friday’s jobs report leaves the country with 10.7 million fewer paid posts than it had pre-pandemic — and signals a sharp slowdown in the rate of labor market recovery. In October, the U.S. added 610,000 jobs, and economists had expected to see a 460,000 job gain last month, as holiday hiring partially offset the effects of rising COVID case rates. Officially, the true job gain was roughly half that sum — and truth is actually grimmer than the official, headline number would suggest.”
“Some Small Hedge Funds Reap Big Gains In Tough Times” (Wall Street Journal).”Hedge funds are trailing the U.S. stock market this year. Some of the smallest funds are emerging as some of the best performers, driving greater demand for these types of managers. Funds with less than $1 billion in assets are benefiting from their more manageable portfolios. They can dart in and out of holdings to protect gains or minimize losses amid the market volatility that has characterized this year. They also get more bang for their buck—making investments that require less firepower to affect their overall performance.”
“Kodak’s Stock Soars 70% After Probe Reportedly Finds No Wrongdoing In Government Loan” (CNN Business). “Kodak's stock rocketed about 70% higher in premarket trading Monday after the US government reportedly found no wrongdoing in Kodak's now-halted $765 million loan to help the company produce pharmaceutical ingredients.”
“JPMorgan Warns Of Crowded Trades Amid Markets’ ‘Clear Consensus’” (Bloomberg). “There’s strong consensus in markets right now and investors need to position to hedge against crowded trades, according to JPMorgan Chase & Co. The last time such a strong agreement on strategy existed was in late 2017 and early 2018, and that time period serves as a reminder that such a consensus view rarely plays out in its entirety, strategists led by Nikolaos Panigirtzoglou wrote in a note Friday. Global stocks reached records in January 2018 amid massive inflows, but extended positioning in risk assets became a concern and the next month the “Volmageddon” volatility spike crushed trades that many investors had viewed as a sure thing.”
“‘This is Insanity’: Start-Ups End Year In A Deal Frenzy” (New York Times). “At the onset of the pandemic, warnings of start-up doom abounded. Those largely faded after the initial shock of the coronavirus wore off. Now, as the new reality of remote work, school, shopping and socializing supercharges the adoption of tech products and services, sentiment has flipped even further — to a frenzy of deal making.”
