The Wednesday Letter 187 - 27 September 2023

THIS WEEK: Labor Unions Return; Market Correction; Immigration Chaos; 2024 Presidential Race; China After the Dividend; S&P Sectors Update; GeoReads #006; Tweets and Charts.

LABOR UNIONS RETURN

Are unions having a moment? It is quite possible, after decades in the wilderness. President Reagan famously fired 11,345 air traffic controllers when their union (PATCO) called an illegal strike. This marked the beginning of a long decline for labor unions in America. Decades of disinflation and prosperity, and the twin rise of a service economy and a digital economy, eroded the appeal and effectiveness of unions. In addition, a steady supply of new young workers and of more women joining the workforce impaired the negotiating power of workers. But today, several of these factors are reversing, and we may see as a result a revival of unions. Inflation has come down from last year but prices have outpaced wages. House affordability is low and is keeping young people in rentals where they have less opportunity to build wealth. Borrowing rates are higher than they have been in over a decade.

Most important, the supply of new workers is less strong than it was in the 19…