United States of America eSeries: The September scaries 📉

The September scaries 📉

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Today really should have been Friday. Let's get into it.

by Allison Morrow

📉 SEPTEMBER SCARIES

Ah, September. That special month when corporations pummel us with pumpkin spice and corduroy even when it's still 90 degrees out; the month in which we're frankly kind of over the beach but not ready to break out the wool sweaters; the start of Virgo season — a time for putting your head down and getting work done.

And if you're an investor, a time for holding on and trying not to panic.

Students of market history (like my colleague Paul R. La Monica) know that September is traditionally the worst of the year for stocks. It's called the September Effect, and while we can pinpoint certain behaviors or news events that contribute to it (for example, investors coming back from vacay all at once and cashing in on their summer positions), it's widely seen as an anomaly.

Some quick history:

September 2020: The S&P 500 fell nearly 4%. That turned out to be just a blip, of course, but at the time, Covid-19's uncertain path gave everyone jitters. Not unlike our current status, sadly.
The average September return for the S&P 500 has been a loss of 0.5%. Every other month, apart from a February, stocks have tended to go up on average.

This September has the potential to be an absolute dumpster fire, too (see headlines re: the Delta variant, chaos in Afghanistan, wildfires, hurricanes, etc). Stocks are already at record highs. And investors may be jittery ahead of the Federal Reserve's policy meeting later this month, when we may get word that the easy-money policies fueling the pandemic-era bull run are coming to an end.

It could be gloomy, but it doesn't have to be. It's worth reminding investors that they shouldn't make moves on something arbitrary like the calendar month. Leave that to me and my armchair astrology (and as a side note, maybe don't go wild when Mercury goes into retrograde on the 27th — no one needs that drama).

And history also has a silver lining: Not every September has been trash, just most of them. The S&P 500 actually rallied in September 2017, 2018 and 2019.

NUMBER OF THE DAY

$4 billion

A federal bankruptcy judge approved a settlement to dissolve Purdue Pharma, the maker of the addictive painkiller OxyContin, and require the company's owners, members of the Sackler family, to hand over more than $4 billion to address the opioid epidemic. The ruling also awards members of the family broad immunity from future opioid-related lawsuits.

🚂 THE SLOW ROUTE

Amtrak might add more than 50 new routes. But they still won't be faster than a car.

Here's the deal: Amtrak should get a cash infusion of about $66 billion from the $1 trillion infrastructure bill. That means it can expand its service to new places. But that won't be enough to upgrade the infrastructure needed to make train travel faster than driving in most places.

Amtrak has proposed spending its share of the infrastructure funding on more than 50 new routes, but those routes are significantly slower than typical car travel between the cities — sometimes as much or more than 40% at certain times of day, my colleague Matt McFarland writes.

A train from Boston to Albany, for example, would take 4 hours and 20 minutes — more than an hour longer than it would take to drive. A jaunt from Milwaukee to St. Paul will take 6 hours and 45 minutes, roughly two hours longer than a car trip.

This is not to pooh-pooh the idea of having more train options. But from an international perspective, American train travel is an embarrassment. Trains in Europe and Asia have approached 200 mph since the 1960s. The new Amtrak routes between major cities, like Chicago to Cincinnati, will average speeds of less than 50 mph.

There are a lot of reasons the United States lags behind the rest of the developed world, but the biggest one is that the federal government has for decades invested heavily in infrastructure that supports car and air travel rather than rail. Which means whole generations of Americans have grown up not understanding how delightful train rides are. For starters, you get to sit back and read a book with a glass of wine rather than sit in traffic and shout at fellow drivers. You're less likely to suffer motion sickness. You can watch a movie on your phone or take a nap. It's heaven. And of course, it's far more environmentally friendly.

Amtrak says it wants to bring more people on board, so to speak, with train travel. But rail experts are skeptical of whether Amtrak can do that with the sluggish routes it's proposing.

🔌 QUOTE OF THE DAY

We can always have done more. But this was a Category 4 hurricane. It's going to cause outages. No one should design for 100% reliability because it's exponentially more expensive.

— Michael Webber, professor of energy resources at the University of Texas at Austin

It's virtually impossible to design an electrical grid that will withstand everything nature throws at it. But more can be done, experts say, to make systems like the ones in Louisiana better able to bounce back from outages. Events like Hurricane Ida, the ice storm in Texas earlier this year and the wildfires in the west are only going to get worse in the coming years.

WHAT ELSE IS GOING ON?

🎙️ Joe Rogan, one of the world's highest paid podcast hosts, said he has tested positive for Covid-19 and that he's embarked on a fringe treatment regime (one that health officials have strongly discouraged people from using).

📲 Apple has enlisted eight states in a program that allows people to "seamlessly and securely" add their driver's license or state IDs to their Apple Wallet to use at airport security checkpoints.

📦 Amazon is planning to hire another 55,000 employees globally in the next few months. Rival Walmart, meanwhile, is looking to hire 20,000 workers for its distribution and fulfillment centers, trying to fill some of the most high-demand jobs in retail as the pandemic continues to disrupt the global supply chain.

🐦 Twitter is testing a new feature called "Safety Mode," which aims to help users who are being overwhelmed by harmful tweets and unwanted mentions (...a situation women refer to as existing on Twitter.)