November 22, 2016

Stocks Up, Fed Increase Likely

For the second straight week, the major domestic indexes all ended in positive territory: The S&P 500 was up 0.81%, the Dow increased 0.11%, and the NASDAQ added 1.61%. While American indexes performed well, MSCI EAFE’s international equities declined 1.58%. Stocks are up, fed increase likely. With the long, drawn-out presidential election behind us, investors are beginning to look past politics and pay closer attention to the economic fundamentals. As we’ve shared in recent market updates, the economy shows many signs of strength and growth. In the past few weeks alone: GDP beat expectations. Hourly earnings increased. The Dow reached an all-time high. New unemployment claims hit a 43-year low. Housing starts increased 25.5%. Of course, the economy is far from perfect – and growth is still slower than we’d like – but the overarching message is that the economy is doing well. Thus, we were not surprised this week when Federal Reserve Chair Janet Yellen said an interest rate hike “could well become appropriate relatively soon.” Despite what talking heads might warn on television, you should not be afraid of increasing interest rates. The last increase, which took place in December 2015, may have contributed to the volatility we experienced […]
July 12, 2016

S&P Tests New High on Jobs Surge

S&P Tests New High on Jobs Surge WEEKLY UPDATE – JULY 11, 2016 Markets surged last week after a surprising June jobs report buoyed investor sentiment. The S&P 500 came within a hair of a new record close on the news. For the week, the S&P 500 grew 1.28%, the Dow gained 1.10%, the NASDAQ added 1.94%, and the MSCI EAFE fell 1.76%.[1] Stocks surged after Friday’s better-than-expected June jobs report. The S&P 500 closed Friday at 2,129.90, less than a point from its record closing high of 2,130.82 reached in May 2015.[2]  The rally was broad-based, and we’re happy to see that investors are shaking off global worries by responding to success stories at home. After disappointing April and May jobs reports introduced worries of a labor market slowdown, the June report showed that the economy added 287,000 new jobs last month. Since expectations called for around 165,000 jobs, investors counted the report as a solid win for the economy.[3] How many jobs does the economy need to support sustainable growth?According to a survey of Wall Street Journal economists, the break-even number for sustainable labor growth could be an average of 145,000 new jobs per month. Fewer new jobs, […]
June 28, 2016
Why you will never retire! “Why you will never retire!” Let’s find out. We all have hope and dreams—travel, relaxing, paying golf every day or for me personally sitting on a beach after a morning of wetting a line (a.k.a. fishing)…basically enjoying the vacation life everyday.  Whatever you’re dreaming of could be nothing more than a pipe dream unless you take the necessary steps. According to a recent survey, half the households in America have saved less than $10,000 for their retirement income.  Whether they’re just overspending or planning to live off social security, most people aren’t saving enough to retire plain and simple. So what’s the reason for this trend? 1. We start saving to little too late  Most people spend their years in college and come out in their early 20s. Then they get into their 30s and their trying to find that new job, buying their first house, getting married, having babies. Somewhere between their 30s and 40s life seems to be getting a little better…maybe they get a pay raise at work…and now they go out and go in BIG DEBT buying brand new fancy cars, big fancy toys, big fancy houses, etc. and they still aren’t looking toward retirement. […]
June 20, 2016

Fed Blinks on Brexit Fears – Financially Simple

Fed Blinks on Brexit Fears WEEKLY UPDATE – JUNE 20, 2016 Markets fell on Brexit fears and concerns about the Fed’s dovish statements, giving the Dow its worst week in a month.[1] For the week, the S&P 500 slipped 1.19%, the Dow fell 1.06%, the NASDAQ dropped 1.92%, and the MSCI EAFE lost 2.78%.[2] The big news last week was the Federal Reserve’s decision not to raise interest rates. The decision wasn’t a surprise; just before the announcement, traders had assigned just a 1.9% chance of a June rate increase.[3] Looking at the official statement, we can see that the Fed is concerned enough about a slowdown in the labor market and persistently low economic growth to hold off on raising rates.[4] However, the Fed largely hasn’t changed its forecasts for economic growth or unemployment, indicating that its concerns may be short-term.[5] Is that decision a reflection of the data or a political move designed to support its vision of a healthy economy? It’s hard to say. A July rate increase is still possible though traders don’t seem to buy it. Current probabilities of a July rate hike sit at just 7.0%.[6] What would need to happen for the Fed to move in […]