According to a Friday report released from the Bureau of Labor Statistics, the unemployment rate jumped to 3.7% in October, while payrolls increased by 261,000.

The health-care industry saw the most substantial job growth, followed by professional services and manufacturing. The hotel industry continues to be the worst hit by labor shortages, with employment being significantly below levels recorded at the start of 2020.

For much of the year, the unemployment rate has stayed between 3.5% and 3.7%. The most current numbers show a 0.2% increase above September levels.

“The October employment report appears to be more of a mixed bag than we’ve seen previously,” Bankrate Senior Economic Analyst Mark Hamrick said. “Hiring has lagged behind the strong trends over the last few years. There’s a good chance that the unemployment rate has been at its low point for some time.”

Although payroll figures were better than projected, economists predicted that unemployment would continue at 3.5%. The Dow Jones Industrial Average rose 345 points, or 1.1%, on the news, while the S&P 500 and Nasdaq rose 1.4% and 1.6%, respectively.

The employment data came only days after the Federal Reserve hiked the target federal funds rate by 0.75% for the fourth time in a row, despite officials assuring markets that they will not impose an unduly contractionary monetary regime. Increased borrowing costs for households and companies impede economic activity. The central bank is seeking to cool inflation, which was 8.2% year on year two months ago, according to the Bureau of Labor Statistics statistics.

“The rate of hiring is anticipated to decline considerably during the coming year,” Hamrick warned. “This report will not persuade the Federal Reserve to change its stance on raising interest rates. Before the next policy-setting meeting in mid-December, it has a lot more data to consider, including inflation figures.”

President Joe Biden interpreted the job data, which comes just days before the midterm elections, as evidence that the labor market “remains robust” under his leadership, despite some signals of a hiring slowdown.

“Our biggest economic concern is inflation, and I recognize that American people are feeling pinched.  The worldwide inflation that is raging in other nations is now affecting us. I have a plan to reduce prices, particularly for health care, electricity, and other everyday expenses,” the president said in a statement. “We will do all it takes to get inflation down. However, as long as I am president, I will not accept the premise that the problem is that too many Americans are finding decent employment.”

As inflation outpaces wage growth, several economic constraints have lowered living standards. According to polls, those who trust Republicans more than Democrats in managing economic policy are focused on the economy more than any other subject, including contentious social issues like abortion or concerns about the foundation of democracy.

The Federal Reserve hiked its target federal funds rate by three-quarters of a percentage point, sending markets soaring as policymakers hinted at slowing the speed at which they tighten monetary policy.

The move comes after the Fed boosted interest rates in June, July, and September, putting the current federal funds rate between 3.75% and 4%.

“Recent indicators indicate a moderate increase in expenditure and output,” the Board of Governors of the Federal Reserve announced in a statement. “We have seen solid job growth in recent months, and the unemployment rate has stayed low. Inflation remains high, reflecting pandemic-related supply and demand imbalances, increased energy and food prices, and broader pricing pressures.”

Following the news, the Dow Jones Industrial Average increased by 300 points. The statement that policymakers “would take into consideration the cumulative tightening of monetary policy, the delays with which monetary policy influences economic activity and inflation, and economic and financial events.” 

The rate hike follows the release of the Bureau of Labor Statistics’ most recent inflation data, which indicated that the Consumer Price Index grew 8.2% year on year in September, beating experts’ expectations by 0.4%. Despite several categories of energy costs declining, a 0.8% increase in food prices and a 0.7% spike in shelter prices contributed to the headline figure.

The Federal Reserve had set a near-zero interest rate goal and purchased government bonds to bolster the economy for most of the previous two years in order to minimize the consequences of the lockdown-induced recession. Many prominent economists have recently attacked the central bank amid the return to a contractionary monetary regime, claiming that officials who were reluctant to respond to increasing price levels are now causing disproportionate harm in their effort to combat inflation.

Rising interest rates have had a particularly negative influence on the housing market, as higher mortgage rates reduce affordability. According to data from the government-backed mortgage business Freddie Mac, the 30-year fixed mortgage rate has been below 3% for much of the last two years. However, since the start of the year, the rate has increased from just over 3% to almost 7%, with a roughly 1% increase in less than a month.

Following two consecutive quarters of economic contraction, Federal Reserve officials have frequently cautioned markets that economic growth will be “basically flat” in the second half of the year, meaning that the United States has entered a technical recession.

The slowdown in demand brought about by monetary policy tightening has only been partially recognized so far. “The transmission of tighter policy is most visible in highly interest-sensitive sectors such as housing, where mortgage rates have more than doubled year to date and house price appreciation has decreased sharply in recent months and is on track to be flat soon,” Federal Reserve Vice Chair Lael Brainard said last month at a conference in Chicago. “In other sectors, transmission delays mean that current policy initiatives will have their full impact on activity in the coming months, and the impact on price setting might take longer. Demand should be supported by a synchronous fast global tightening of monetary policy.”

According to Democrats, inflation began as a blip, then became “hotter than projected, but it would decline next year.” It was sometimes Vladimir Putin’s fault, and other times inflation was beneficial. Inflation would soon be eliminated by merely spending an additional $740 billion. Most recently, if you care about inflation, you’re a Nazi. Now Biden expects us to think that if Republicans are elected, inflation will worsen.

How can anyone take Biden’s frantic shift in rhetoric seriously when he has either ignored the subject or blamed everything but his own actions for America’s economic woes? Polling in American politics can be volatile, but it’s safe to conclude that the mood of the country doesn’t at all. Over the past year, voters’ primary worries have been inflation and the economy.

With fewer than two weeks until Election Day, Biden and Democrats’ final argument seems to be that Republicans want to destroy the economy. Given that Republicans have recovered momentum and are growing their advantage in critical states and on the general election ballot, it’s no wonder that Democrats are repeating the tired Obama-era talking theme that Republicans are seeking to damage the economy for political advantage. As if that hasn’t been the case with Democrats for the last two years. To satisfy radical environmentalists, Biden has stifled American energy independence, his expenditure packages have equated to handouts to key left-wing groups, and the governmental regulatory system aims to diminish market competition to assist left-wing labor unions. What does an American taxpayer get in exchange? There will be 87,000 extra IRS agents, a student loan handout to the privileged and well-connected, and a $31 trillion national debt.

American economic outlook has only deteriorated during Biden’s presidency. Inflation remains high and stable. Gas prices continue to be stubbornly high. Mortgage and rent prices are rising. Markets have taken a blow in recent weeks, and most analysts now predict an approaching recession, yet Biden has the audacity to claim that the Republicans are the ones to really be concerned about?

What has been the unifying factor over the last two years? Washington, DC is ruled by a single Democratic party. When it comes to inflation, Democrats have no answer since they are well aware that their economic strategy simply does not work.

Consumers will face sky-high inflation throughout 2022. And, although the Federal Reserve has aggressively raised interest rates in an attempt to slow the rate of inflation, it has so far failed.

As a result, consumers have racked up huge credit card debts and raided their savings in order to stay afloat. And new data shows how much money inflation costs the average American.

A devastating blow

According to Moody’s Analytics, the average U.S. household had to spend an additional $445 in September because of inflation. Even as gas prices have fallen significantly from their peaks earlier this year, food prices, in particular, have steadily increased, putting consumers in a difficult position as the holiday season approaches.

When it comes to combating inflation, you’ll frequently hear advice such as “It’s time to start cutting back on spending.” However, the average consumer is unlikely to spend the extra $445 per month on leisure purchases. Rather, the extra spending is tied to necessities that consumers cannot afford to cut.

However, just because cutting back on spending isn’t a viable option right now doesn’t mean you’re doomed to end 2022 with a mountain of credit card bills because of inflation. If you’re inclined to take on a second job, it might be sufficient to help you get through these trying times.

Unfortunately, we could be facing many more months of hyperinflation. If you’re weary from seeing your bills – and overall debt – rise, a second job could help you make it through this extended period of difficulty and emerge unscathed.

On Tuesday, the Pacific Legal Foundation asked the Supreme Court to block the Biden administration from implementing its goal of canceling $10,000 in student debt for millions of students.

Allowing the White House to adopt the action without court scrutiny, the nonprofit legal organization claimed, would “encourage similar malfeasance from future administrations on a plethora of other problems.” The student loan cancellation proposal would also forgive up to $20,000 in student loans for Pell Grant recipients.

“The government is seeking to erase half a trillion dollars in debt without any legal foundation,” said Caleb Kruckenberg of the Pacific Legal Foundation in a press statement. “The Court should put a stop to this unlawful activity until the courts review it.”

Attempts to block the student loan cancellation policy have already been rejected by the legal system. Justice Amy Coney Barrett of the Wisconsin Supreme Court denied an emergency appeal filed by the Brown County Taxpayers Association, most likely because the plaintiffs lacked legal standing to challenge the regulation.

District Judge Henry Autrey of the Eastern District of Missouri ruled that his court lacked jurisdiction to hear a separate case filed by six Republican attorneys general, forcing the officials to seek emergency relief from the Eighth Circuit Court of Appeals. On October 21, the court ordered the White House to delay from erasing student debt, providing an administrative stay while justices review the complaint.

Many leftists have criticized Biden’s student loan proposal, claiming that he lacks the ability to erase up to $500 billion in debt without the permission of Congress. According to the Pacific Legal Foundation, the Department of Education has also neglected to release any official regulations or “any legally binding explanation” of the student debt cancellation program.

“At no time has the administration presented a convincing case that the underlying policy is legitimate,” Pacific Legal Foundation attorney Michael Poon remarked. “The administration’s practice of ‘lawmaking by press release’ is certainly unlawful.”

In a related case, the group said that President Joe Biden used the HEROES Act, a 2003 statute intended to help Iraq War veterans and their families, to justify the loan cancellation with “breathtaking informality and opacity.”

Last month, Biden stated that more than 22 million individuals had already filed for student loan relief. “My vow when I campaigned for President of the United States: if elected, I’d make the government operate and deliver for the people,” he stated at Delaware State University, a historically black college. “A straightforward application procedure maintains that promise, just as I maintain my commitment to alleviate student debt while borrowers recover from the economic crisis brought on by the once-in-a-lifetime pandemic.”

Though the president stated that “not a dollar” will assist the top 5% of earners, facts show that student debt forgiveness mostly benefits those who are prepared to make the most from their degrees, as graduate-level education is frequently required for the most lucrative jobs. According to a Brookings Institution analysis, the wealthiest 20% of households owe one-third of student debt, while the poorest 20% owe only 8%.

The last earnings season of 2022 is already underway for investors. Companies frequently complete their fiscal year with a dividend increase, which has been pretty brisk recently. Businesses of all sizes and sectors are increasing their payouts.

AbbVie (ABBV -0.10%) and Visa (V -0.70%) are two of the top lifters in their respective industries. Let’s take a deeper look at these two firms’ recent dividend hikes and why they may be appealing to investors.

1. AbbVie 

Being the creator of the world’s best-selling medication has its perks. AbbVie is the parent firm of Humira, the blockbuster medicine for rheumatoid arthritis and a slew of other ailments, with sales exceeding $20 billion last year.

With a number like that generated from just one medicine, it’s no surprise AbbVie is generous with its payout; in fact, it’s one of the stock market’s few Dividend Kings, with a five-decade run. The corporation announced a 5% dividend boost to $1.48 per share in conjunction with the release of its most recent financial report.

There is one important caveat with Humira: it is losing its patent protection (no, the business did nothing wrong; medications authorized in most major nations, including the United States, are only guaranteed limited patent exclusivity).

It tells something about AbbVie’s resilience as a firm that Humira’s patent expiration will not sink its business. Skyrizi and Rinvoq, AbbVie’s other immunology medications, brought in more than $1.7 billion in the 3rd quarter, with sales increasing by around 75% and 54% year over year. And those are only two of the many medications in the company’s extensive commercial portfolio.

AbbVie’s dividend increase takes effect with the payout planned for Feb. 15, 2023; it will be given to stockholders of record as of Jan. 13. The additional sum would yield little more than 4% at the stock’s most current closing price.

2. Visa

Although Visa’s dividend growth streak isn’t as long as AbbVie’s, and its yield is far smaller, Visa is a consistent payer and lifter. True to form, the firm announced a 20% increase in quarterly distribution to $0.45 a share towards the end of October.

The payment card behemoth has also benefited greatly from the world’s long-tail trend away from cash and toward plastic and digital transactions. Combine it with an asset-light approach (Visa does not extend credit, but rather functions as a processor of payments made with its cards) and you’ve got a winning combination for high-margin profits and growth.

Visa’s full-year fiscal 2022 results were standard for this financial sector behemoth; net revenue increased by 22% to an astounding $29.3 billion.

The decline in the use of currency is far from over. Even if the global economy stumbles in the next months, Visa should continue to rake it in – although at a slower pace. Analysts following the stock anticipate about 10% revenue growth and an 11% increase in profits per share this fiscal year.

The newly increased dividend will be paid to shareholders of record on November 11 on December 1. On the current stock price, this would result in a 0.9% yield.

Investors were thrilled to see the stock market perform so well last week, but there is still a long way to go before anybody can declare the bear market over. Furthermore, sustained momentum has been difficult to achieve. To begin the week, Wall Street appeared to be suffering from the Monday blues, with futures contracts on the Dow Jones Industrial Average (DJI -0.14%) and other key indexes down around half a percent in premarket trade.

Both XPO Logistics (XPO 4.84%) and Emerson Electric (EMR 0.40%) have a long history of helping industrial clients, but both have utilized technology to help improve their respective operations. Learn more about why their stocks rose early Monday and what the future may hold for both below.

XPO continues to expand

The transportation and logistics company presented third-quarter financial figures that provided useful information about the overall status of the economy.

The quarterly results for XPO were mixed. Total revenue fell 7% to $3.04 billion, however this was due to XPO selling off its intermodal business in the previous year. Sales were actually up 3% year on year when the intermodal category was excluded. Adjusted net income increased by more than half to $168 million, or $1.45 per share.

CEO Brad Jacobs emphasized the company’s excellent volume growth and exceptional profit margin performance in both its less-than-truckload (LTL) and truck brokerage sectors. LTL tonnage, in particular, increased every month throughout the quarter and showed sustained signs of growth in October, overcoming not just usual seasonal headwinds but also signaling continuous resilience in the broader economy.

This week, XPO will spin out its truck and transportation brokerage platform as RXO, with XPO continuing to maintain the North American LTL business. Investors are optimistic about the future for both stocks as the firm outperforms the industry.

Emerson makes a significant move

Emerson Electric shares rose marginally early Monday as investors digested the company’s newest announcement. The industrial company disclosed a partial sale of a significant business in addition to its fiscal fourth-quarter results for the period ending September 30.

Emerson’s quarterly results were strong. Sales increased 8% year on year to $5.4 billion, while adjusted profits per share increased 16% year on year to $1.53. Emerson had a strong year, with full-year sales growth of 8% and earnings of $5.25 per share matching the 16% growth rate in its bottom line. The firm witnessed notably strong profits in the Americas, whereas Europe had weaker gains, owing mostly to currency impacts.

The greater news, though, was Emerson’s decision to sell a controlling position in its Climate Technologies company to private equity firms managed by Blackstone. Climate Technologies will be valued at $14 billion in the transaction, with Emerson receiving around $9.5 billion in cash while maintaining a minority ownership in the company.

Emerson claims that by selling its refrigeration and HVAC businesses, it would be able to concentrate more on global automation. This might drive growth, but it also increases the likelihood that Emerson’s stock could see higher volatility in the future.

Cathie Wood’s ARK Invest has struggled after a fantastic 2020. ARK Innovation ETF (ARKK 3.59%) shares have fallen over 77% from their all-time highs.

While the firm’s outcomes may change, its investing approach does not. ARK Invest continues to invest in innovative growth companies, and it has grown increasingly bullish on Roku (ROKU 3.42%). As of this writing, the streaming platform is ARK’s third largest holding across all of its ETFs.

Why, you may ask? Cathie Wood and ARK Invest have set an extremely bullish price target of $605 for the firm by 2026, implying a 1,050% return from the stock’s present price of around $52.60. Is this pricing point, however, within Roku’s grasp?

Wood may be overconfident…

Many growth investors that invest in risky firms are attempting to outperform the S&P 500 index, which has returned around 11.9% each year since 1957. When investors strive to “beat the market,” many of them expect to earn merely a few percentage points extra every year. As a result, Wood’s Roku price target of $605 may be too high.

This price target forecasts a price increase of more than 1,000% in only four years, representing a compound annual growth rate of more than 84%. In other words, Wood expects Roku’s stock price will rise 84% each year (on average) over the next four years.

While outperforming the market has been done in the past, that price prediction anticipates some highly uncommon price appreciation. In comparison, Apple has returned around 518% over the last decade. While that has far outperformed the market, it is barely half of what Wood forecasts for Roku (over an even shorter period).

Not to mention the challenges that Roku will face in the future year or two. With the current state of the American economy, Roku faces two challenges.

First, customers are less inclined to spend money on luxury items such as televisions right now. Second, the hard macro climate is prompting businesses to reduce ad expenditure, which is where Roku generates most of its money. As a result, Roku revised its Q3 sales projection, predicting only a 3% year-over-year revenue increase for the period.

Not only that, but Roku’s profits have plummeted in recent quarters. Roku’s trailing-12-month free cash flow was about $200 million at the start of 2022, but it has since dropped to a burn of $5 million. The same is true for net income during the previous 12 months.

But she could be onto something.

While Cathie’s price goal may be too high, there are still reasons to be bullish about Roku in the long run. Streaming is rapidly growing in popularity, lately surpassing cable TV in terms of usage. The Trade Desk reports that 109 million households in the U.S. had connected TV streaming in 2021, a significant increase over the 68.5 million cable subscriptions during the same time period.

Streaming may be on the rise, however, advertisers have yet to adapt. Advertisers are expected to spend just 22% of their TV ad spending on streaming in 2022, whereas Americans aged 18 to 49 spent 50% of their TV time streaming in the second quarter of 2022. These rates are expected to converge in the long run as marketers see the value of advertising on streaming platforms.

Given that Roku is the most popular streaming platform in the United States, Canada, and Mexico, with over 63 million active users, the company appears to be best positioned to capitalize on this tremendous potential.