Job Growth Jumps, Bitcoin Soars Above 100K

After a disappointing jobs report in October, where hurricanes and strikes wreaked havoc on the results, the labor market snapped back in November. The economy produced 227,000 jobs, as striking workers and storm-affected employees came back into the fray and new jobs were added in health care (+54K), leisure and hospitality (+53K), and government (+33K). Annual wages rose 4 percent, ahead of the 2.6 percent inflation rate (CPI). As wage growth continues to exceed CPI, the sting of high prices should recede.

With revisions to the previous two months, the economy has now gained 2.27 million jobs from a year ago. While the Bureau of Labor Statistics’ annual benchmark revision will likely reduce the amount, there is no doubt that 47 consecutive months of job creation has been the engine of growth for the U.S. economy. As Fed Chair Jerome Powell recently said, “we are sort of the envy of large economies around the world, [growth] is stronger than we thought it was going to be in September [the last time the Fed released its economic projections].”

BITCOIN 100K

This week, bitcoin crossed a milestone: $100,000. This caused me to take a walk down memory lane. The first Bitcoin story that I covered for CBS was in 2013, when it rose above $1,000, from $13 at the beginning of the year. What a long, strange trip it’s been for crypto over its more than 15 years of existence. Back then, people like me were warning that Bitcoin, which was largely unregulated, could be used for money laundering and other criminal enterprises.

In 2017, a few months before bitcoin futures were launched on the Chicago Mercantile Exchange (CME), JP Morgan Chase CEO Jamie Dimon said investor euphoria over bitcoin was “worse than tulip bulbs. It won’t end well. Someone is going to get killed, it will blow up.” Dimon was sort of right, in that bitcoin has been a wild, volatile ride. It zoomed higher amid the pandemic trading frenzy, peaking at $69,000 in 2021, only to come crashing down to earth to $16,000, after Sam Bankman-Fried’s felonious crypto exchange FTX was eviscerated in November 2022.

Now two years later, there has been widespread adoption of crypto by even the stodgiest of investment companies, helped by the easy access that various financial products provide to individual investors. As all financial assets were rising in 2023 and again this year, more money was thrown into crypto. Oddly, the presidential campaign added fuel to the crypto fire, as candidate Trump proclaimed that he would be the first “crypto president”. True to his word, after the election, the President-elect’s choices to lead the Treasury Department (Scott Bessent) and the Securities and Exchange Commission (Paul Atkins) are further signs that the administration will reduce regulation, especially when it comes to crypto. This would be a big turnaround from the Biden administration, which aggressively pursued crypto wrong doers.

Here are a few questions that I have been fielding about crypto investing:

• Is It Too Late to Buy Now?

  I am not a market timer, but before you make a risky bet on any individual investment idea, you need to address your Big 3: (1) Establishing an emergency reserve fund of 6-12 months of living expenses, (2) paying down high interest consumer student debt, and (3) maxing out your retirement account. If you have the Big 3 covered, know that any crypto investment will be volatile, so keep the amount invested to under 5 percent of your total investments.

• How Should I Invest in Crypto?

  The most straightforward way is to directly purchase the coins you're interested in through a crypto exchange. But direct investments in crypto are not insured by the FDIC or the Securities Investor Protection Corporation, so if the platform goes broke there is no protection except the bankruptcy courts.

For the vast majority of people, buying an exchange traded product or an exchange traded fund through most trading or investment platforms is probably the easiest way to invest. Earlier this year, the SEC approved the trading of ETFs that invest directly in bitcoin, giving investors a simple way to make their bets. You can also buy stock in companies that invest in crypto.