1 July 2019

1) Consumer spending increased in May as well as prices creeping up too. Both point to a slowing economic growth and benign inflation pressures. These two facts gives the Federal Reserve more reason to cut interest rates next month. Inflation is under the 2% target for this year with a projected 1.5% verses 1.8% originally expected. Consumer spending is about two thirds the U.S. economy.

2) Consumerism is changing fast, with a push to ‘no cashier checkouts’. Amazon Go stores are pushing the technology where sales payment is made automatically just by picking out items and walking out the door. E-commerce and on-line shopping continue their assault on traditional brick and mortar stores. Another strategy is showrooms in place of stores that allow the customer to try out products prior to purchasing them. Finally, drone delivery allows getting your purchases at home in less time than it takes to drive to and from a store. All these new technologies are coming together with increased profits by reducing labor cost.

3) The weekly jobless claims has increased more than expected, although there is no sign of significant layoffs as the economy slows down. Unemployment claims were 227,000 up by 10,000. The economy is slowing with manufacturing sliding down and the trade deficient widening as consumer confidence ebbs.

4) Stock market closings for- 28 JUN 19: Results from bank stress test edged markets up. Best June performance since 1938.

Dow            26,599.96    up    73.38
Nasdaq         8,006.24    up    38.49
S&P 500        2,941.76    up    16.84

10 Year Yield:    down   at    2.00%

Oil:    down   at    $58.20

30 April 2019

1) Reports are that China and the U.S. are nearing the conclusion of talks to overhaul their economic relationships. Talks are nearing a point where they will produce a deal or end with no agreement. These talks have been in progress for months and have included tariffs from both sides, and in the process have upset world markets. The biggest obstacle is agreeing on how to enforce an agreement.

2) This March, U.S. consumer spending has increased the most in nine years, driven by purchases of motor vehicles. However, fears of inflation remain mute, giving support to a stronger economic growth in the second quarter.

3) Corporate economists consider there will be slower U.S. growth in the future. They fear the tariffs recently imposed are a drag on growth. Still, they consider the economy will continue to expand, just not at a fast rate.

4) 29 APR 19 Stock market closings:

 Dow             26,554.39    up    11.06
Nasdaq           8,161.85    up    15.45
S&P 500          2,943.03    up      3.15

10 Year Yield:    up   at    2.54%

Oil:    up   at    $63.57

25 April 2019

1) Boeing’s profits have plunged because of their 737 MAX problems, which has cost them one billion dollars so far. The fix for the aircraft is causing uncertainty in their earnings and how long it will take before the aircraft is re-certified for operating. There are further concerns over foreign re-certification taking longer than the FAA. Boeing had 4,600 unfilled orders for the 737 MAX.

2) Almost one half of American parents are cutting back on their retirement savings to help pay their adult children’s bills. Additionally, parents are not setting aside some amount of their earns for retirement savings, instead are helping their children pay bills. The average American needs three-quarters of a million dollars in savings to retire and maintain their standard of living.

3) Many major companies are raising prices, considering that raising prices a little will help increase profits. Some of these companies are the railroads, Kimberly-Clark, Procter and Gamble and Whirlpool. Rising wages and raising productivity will tend to increase inflation.

4) 24 APR 19 Stock market closings: Red across the board with everything down.

Dow           26,597.05    down    59.34
Nasdaq        8,102.02    down    18.81
S&P 500       2,927.25    down      6.43

10 Year Yield:     down   at    2.52%

Oil:      down   at     $65.74

21 March 2019

1) Fears of climate change is causing some retired seniors to pull up and move out of Florida, which for many years has drawn the ‘sixty plus year olds’ demographics for a life of peaceful retirement with its low cost of living, no income tax and nice warm weather. But the threat of hurricane damage from flooding and rising sea levels is also making the associated insurance cost soar, in turn causing retirees to reconsider and move more inland, the result some are claiming from global warming.

2) Losses from the flooding in Nebraska is estimated to be over one billion dollars with more flooding forecasted. But even worst is the anticipated impact on farmers. Last year, 19% of Nebraskan farms filed for bankruptcy, and many more are now anticipated to file as the consequence of the flooding pushes more farmers under.

3) The Feds have elected to not raise interest rates again this year, expecting an economic slowdown ahead. There isn’t any need to guard against inflation coupled with indicators of slower growth from household spending and business fixed investment. The GDP was 2.1% instead of the expected 2.3%.

4) 20 MAR 19 Stock market closings:

Dow                25,745.67    down     141.71
Nasdaq             7,728.97          up         5.02
S&P 500            2,824.23     down         8.34

10 Year Yield:    down   at    2.54%

Oil:     down   at     $59.99

27 February 2019

1) Venezuela has 1,700,000% inflation rate, its money now so worthless that the people are now using the Columbia Peso to do business such as paying for labor and buying goods. This has come about because so many Venezuelans are buying what supplies they can get from Colombia.

2) Wal-mart announced they will no longer employ store greeters. This was a job that many handicapped people could do, and there are thousands of disabled workers whose jobs will be lost with limited prospects of re-employment. No reason was given, but the slump in big box retailing was most likely a significant factor.

3) The Central Bank Chief warns that dangers are brewing ahead, the bank closely watching the situation. While the current economy is heathy, fears of the impact of China’s and Europe’s economic future are of particular concern from effects of Brexit and trade negotiations. Also considers the Federal debt making an unstable economic environment.

4) 26 FEB 19 Stock market closings:

Dow               26,057.98    down    33.97
Nasdaq            7,549.30    down      5.16
S&P 500           2,793.90    down      2.21

10 Year Yield:    down   at    2.64%

Oil:    up  at   $55.93    up   at    0.43

13 February 2019

New article posted below titled, “Failings of the Fourth Estate!”

1) The CIO of Vanguard investments expects stock market returns, for the next decade, to drop down from 8% to about 7%.

2) The national debt has topped $22 trillion dollars. The debt increase is accelerating as a result of the tax cut and congressional spending on domestic and military programs. Additionally, the mounting cost to fund social security and the retiring baby boomers is pushing federal spending up too.

3) In Venezuela the cost for a hamburger is now a months wages for the average worker, with inflation now over one million percent annual. Demonstrations mount against Maduro for not letting relief (food and medicine) convoys come in for his people. Maduro rejects foreign aid fearing it is a conspiracy to oust him. This issue could be a wedge between Maduro and the Venezuela military who he depends on to remain in power.

  4) 12 FEB 19 Stock market closings:

Dow                 25,425.76     up    372.65
Nasdaq             7,414.62     up    106.71
S&P 500            2,744.73     up      34.93

10 Year Yield:     up   at    2.68%

Oil:    up   at    $53.34

31 January 2019

1) German technology giant SAP takes a drop in the markets because of a one time write off charge.

2) Chinese purchases of US commercial property is at the lowest since 2012. For the last four quarters, the Chinese have sold more than they bought as the Chinese government pushes to bring money back into China in an effort to stabilize its currency. With China’s economic problems springing from the slowing down in its growth, this trend is expected to continue in 2019.

3) The Feds signal an end to interest rate hikes, with economic growth remaining strong and expected to continue, while fears of inflation are diminishing. Their announcement spurred the stock markets up.

4) 30 JAN 19    Stock market closings:

Dow             25,014.86    up     434.90
Nasdaq          7,183.08    up     154.79
S&P 500         2,681.05    up        41.05

10 Year Yield:    down   at    2.70%

Oil:    down   at    $54.22

HE’S DONE IT!!!!!!!! JEFF BEZOS IS THE RICHEST PERSON IN MODERN TIMES…..WORTH $150 BILLION

LOS ANGELES, CA – SEPTEMBER 20: Founder and CEO of Amazon.com Jeff Bezos arrives at Amazon Video’s 67th Primetime Emmy Celebration at The Standard Hotel on September 20, 2015 in Los Angeles, California. (Photo by Amanda Edwards/WireImage)

By: Economic & Finance Report

Mr. Jeff Bezos has accomplished the unimaginable; well now the unimaginable is now manageable. He is now the richest person in modern day times, this is according to Bloomberg Billionaire Index.

Bloomberg uses inflation based adjustments in their analysis to estimate Bezos’ net worth topping $150 billion. The Amazon mogul so far, is the richest person on earth by far, not since 1982 has anyone accumulated as much in wealth as Jeff. 1982 is when Forbes announced its first richest in the world list).

The richest family however seems to be the Walton family, the dynasty of the Walmart brand. They have accumulated a fortune of over $151 billion collectively.

Bet that on your pretty bottom dollar!!!!!!!!!!!! -SB

U.S. LABOR: PLETHORA OF JOBS BUT VERY LITTLE RAISES TO SHOW!!!!!!!!!!!!!!!

By: Economic & Finance Report

The U.S. unemployment rate has fallen to 3.9%, the lowest it has been in over a decade. The economy is doing tremendously well and analyst/economists are stating wage inflation are on the horizon, while the actual wage inflation is rising slightly.

American job employers are sitting on a lot of jobs though, not able to find qualified workers as shown in the past. The Job & Labor Report released last Tuesday, May 8, 2018; by the Bureau of Labor Statistics (US Dept of Labor), indicated that 6.6 million jobs were added in the last day of March 2018. Jobs increased from the beginning of March 2018, where it was around 4.6 million jobs to the end of March, which became 6.6 million jobs.

Economists have indicated with the inflation rising, the Federal Reserve may be more determined to raise interest rates because the job market and the economy is healthy. With an accelerating economy and the labor markets doing good, one can expect the The Fed to be monitoring the situations accordingly. -SB

Bureau of Statistics: U.S. Department of Labor (https://www.bls.gov/news.release/jolts.nr0.htm)

 

THE FED HAS DECIDED….. NO INTEREST RATE HIKES…FOR NOW…..

Fed Rate hikes

By Economic & Finance Report:

The US economy is doing well, but the the Fed has decided not to raise interest rates, yet. The job market in the US has almost fully recovered, and inflation will eventually go back to 2%. Again, inflation is expected to be very low this year, and by next year should increase.

It seems that the decision not to raise interest rates lied with what the current global economy is going through. China, the Eurozone, Brazil and other countries globally, are going through economic turbulence; so it looks as though the Fed took into account these worldly factors, as an endemic issue. 

The Fed has not stated that it won’t raise interest rates before the end of the year, but as global factors pan out, observers are watching to see where the trends are going to head. -SB