Stocks are moving higher, attempting to price in both a \u201csoft\u201d economic landing,<\/strong> as well as the belief our Fed will let-up on the rate throttle<\/strong>.\u00a0 Many are now starting to believe a soft landing is possible, however much depends on the future actions of the Fed. <\/p>\n\n\n Last week<\/strong>, we heard a continuing to improving Producer Price Index<\/strong>, softer than<\/strong> expected retail sales, and existing home sales<\/strong>.\u00a0 Good news for inflation.<\/p>\n\n\n\n The markets<\/strong> finished flattish with the Dow down (2.66%)<\/strong>, the S&P 500<\/strong> (.65%),<\/strong> the Nasdaq up .55%<\/strong>, and the Russell 2000 down (1.04%)<\/strong>.\u00a0 Foreign stocks<\/strong> were up a slight .01%<\/strong> and Emerging Markets rose .64%.<\/strong><\/p>\n\n\n\n The 10-Year US Treasury yield<\/strong> has been holding fairly steady around 3.5%.<\/strong><\/p>\n\n\n\n This Week?<\/strong><\/p>\n\n\n\n On the economic calendar this week<\/strong>, we\u2019ll hear the first glance at 4th<\/sup> Quarter<\/strong> GDP<\/strong>, Leading Economic Indicators<\/strong>, Durable Goods Orders<\/strong>, and New Home Sales.<\/strong><\/p>\n\n\n\n The most important number will be released on Friday<\/strong>, when we hear the Fed\u2019s favorite inflation gauge: the PCI (Personal Consumption Expenditures Index<\/strong>).\u00a0 This is the last report the Fed will have prior to the February 1st interest rate announcement.<\/p>\n\n\n We\u2019ll also hear an industry variety of corporate profit reports<\/strong>, including Microsoft, Intel, J&J, Verizon, Halliburton, AT&T, Boeing and Tesla.<\/p>\n\n\n\n Will the rally continue?<\/strong>\u00a0 What really matters is what the Fed does and says on February 1st<\/sup>.\u00a0 Will the Fed stomp out the rally for the 3rd time?<\/em><\/strong><\/p>\n\n\n\n Many believe the Fed will raise rates by .25% instead of .50%.<\/strong>\u00a0 Keep in mind over the last couple of weeks, Fed speakers have indicated they will need to go over 5% on the Fed Funds Rate.\u00a0 We are at 4.5%…<\/p>\n\n\n\n When thinking about inflation, one needs to consider China<\/strong>.\u00a0 China is in the process of re-opening,<\/strong> which may put upward pressure on energy prices<\/strong> and perhaps pressure on the price of goods<\/strong>.\u00a0 As China opens its manufacturing sector, that should assist with the supply side of the situation.<\/p>\n\n\n\n I think it\u2019s a bit early to believe inflation pressures are behind us.\u00a0 Let\u2019s face it!\u00a0 Very few of us were adults and investors back in the 70\u2019s.<\/em><\/strong>…<\/p>\n\n\n\n EV Tax Credits<\/strong><\/p>\n\n\n\n The maximum tax credit<\/strong> for the purchase of an electric vehicle is $7,500.<\/strong>\u00a0 If you\u2019re single,<\/strong> your income must be 150K or less<\/strong>.\u00a0 If you are married, filing a joint<\/strong> return<\/strong>, your income must be 300K or less.<\/strong><\/p>\n\n\n\n For the EV to qualify, it must have final assembly in North America.<\/strong><\/p>\n\n\n\n The MSRP limit<\/strong> for a sedan <\/strong>will be $55,000<\/strong> and $80,000 for an SUV\/truck\/van<\/strong>.\u00a0 Tesla just reduced prices of its Model Y and Model 3 to qualify.<\/p>\n\n\n\n Tax breaks are also available for hybrids<\/strong>. <\/p>\n\n\n Upcoming, the government plans to impose battery-sourcing requirements<\/strong> to qualify<\/strong>.\u00a0 For 2023, 40% of the battery\u2019s critical minerals and 50% of it’s parts must<\/strong> be sourced in North America<\/strong> (or countries with a U.S. free-trade agreement).\u00a0 The mineral and component requirements increase by 10% each year.\u00a0 If a car only meets one threshold, for minerals or components, the buyer would only qualify for half of the credit, or $3,750.<\/p>\n\n\n\n To see if a car meets assembly requirements, you can input the vehicle\u2019s identification number on the Department of Energy website: <\/strong>https:\/\/afdc.energy.gov\/laws\/electric-vehicles-for-tax-credit<\/strong><\/a>.<\/strong><\/p>\n\n\n\n![\"\"](\"https:\/\/www.retirementrefined.com\/wp-content\/uploads\/2023\/01\/shutterstock_1911987679.jpg\")
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