Stocks closed modestly lower yesterday after a choppy session that saw the indexes trade on both sides of unchanged numerous times throughout the day.

Earnings season takes center stage this week with big banks set to report.

But the continuing supply shortages and labor shortages are taking a toll.

We're seeing news story after news story bracing shoppers that there will be items they won't be able to get during the holidays due to supply shortages and labor shortages. And we're already seeing labor shortages snarl air travel with the prospect of it getting worse.

As for labor shortages, the Job Openings and Labor Turnover Survey (JOLTS) report showed 10.439 million jobs available. That's down from last month's 11.098M, but still at historic levels. But at the same time, we just saw a record amount of 'quits' with 4.3 million people voluntarily leaving their job on their own.

The labor shortage is real. And the once transitory nature of this is proving to be a longer-term problem.

Yet at the same time, the economy continues to rebound. Some areas slower than earlier forecast, but solid growth nonetheless.

And there's still the potential for trillions of dollars in additional stimulus that could usher in a multiyear boom.

We were headed for one anyway. But the extra stimulus could send the economy soaring even higher, and stocks along with it.

In addition to earnings today, traders will also be looking at several economic reports including MBA Mortgage Applications, the Consumer Price Index, the Atlanta Fed Business Inflation Expectations report, the FOMC Minutes, and the Treasury Statement.

In the meantime, keep your eyes on the big picture.

In spite of the challenges, this is all happening against a backdrop of growth. And keeping up with growth challenges is far different than struggling with an anemic economy. One is bullish and the other is bearish.

And that's why it looks like there's a lot more upside to go.

See you tomorrow,