The monthly jobs report gives us a good chance to think through where we are in the recovery—and what effect the most recent developments have had. With the next report coming this Friday, what should we be looking for?

The celebrated “rainbow nation” of South Africa was recently rocked by the worst violence since the nation achieved democracy and ended apartheid in 1994. Many lost their lives, the economy was hit at a time when it was already reeling under the effects of the pandemic, and its capital markets grew nervous.

Today’s post is from Peter Roberto, investment research analyst on our Investment Management and Research team.

Today’s post is from Sarah Hargreaves, an investment management analyst on our Investment Management and Research team.

As stewards of more than $12 billion in client capital (as of July 25, 2021), our job on the Investment Management team at Commonwealth requires a great deal of risk assessment—and there are many risks that require evaluation. But too often in our industry, the talking heads focus on the short-term ones like interest rate moves and market pullbacks. Most investors, however, have long time horizons. So, what we should be considering as an industry are the longer-term risks that match up with our clients’ goal horizons. One of those risks? Climate change.

For some reason, I have been getting another round of questions about the end of the world. The dollar is collapsing, the IMF is devaluing the U.S. currency, the deficit and debt are blowing up, inflation is rising, and so forth. These end-of-the-world worries usually happen every couple of years, driven by some outside anxiety, which is, at the moment, COVID.

Yesterday, we talked about whether the labor market would balance in the short term. We also discussed whether there were enough people outside the labor force who might move back in, with higher wages and other inducements, to provide enough bodies to not only fill the current vacancies but also provide enough of a cushion to prevent further dislocations in the future. Although it is close, so far the numbers suggest there are enough people out there to do that. In the next year or so, jobs and employees should move back into a rough equilibrium.

A couple of weeks ago, we left off our discussion on the labor market with the conclusion that the labor market shifts were real and reflected underlying changes in both the demographics and demand for jobs. Knowing that, however, doesn’t tell us what is likely to happen in the future. So, let’s think through the factors that will determine just that.

Yesterday was an interesting day. Yes, the headline declines in the stock market made it interesting, and that news is certainly part of it. Still, that kind of volatility is normal. We haven’t seen it for a while, but if you look back, it’s no big deal. In fact, markets are ticking back up again.

Australia has been one of the biggest beneficiaries of China’s growth in the past several decades. China’s infrastructure spending after the last two crises—the great financial crisis and the more recent COVID-19 pandemic—created a demand for resources that was largely fulfilled by Australia. Indeed, this demand helped alleviate some of the pain for the Australian economy.