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Weekly Economic Update

By Financial Planning

MidAmerica Financial Resources Presents:

 

WEEKLY ECONOMIC UPDATE

 

 

WEEKLY QUOTE

              

“If you don’t design your own life plan, chances are you’ll fall into someone else’s plan. And guess what they have planned for you? Not much.”

     

- Jim Rohn

     

   

WEEKLY TIP

             

For the convenience of your executor and heirs, beneficiary designations you have made for various accounts, trusts and policies should be outlined in your will.

  

   

WEEKLY RIDDLE

           

How could Gail drive her car from Cleveland to Miami with a flat tire?    

     

 

Last week’s riddle:

If there are 6 pheasants in a stand of cattails and a hunter shoots one of them, how many pheasants will remain amid the cattails?

   

Last week’s answer:

None, because the rest of the pheasants will fly away when they hear the shot.

 

 

October 28, 2013

    

AN ARGUMENT AGAINST TAPERING

According to the Labor Department, the economy added 148,000 jobs in September. The jobless rate dipped to 7.2%, but job creation has averaged less than 150,000 for three straight months. (August job growth was revised up to 193,000, July job growth down to 89,000.) The University of Michigan’s final October consumer sentiment index slipped in the wake of the federal shutdown: the 73.2 reading was an 11-month low. Economists polled by Reuters forecast it coming in at 75.0.1,2

 

EXISTING HOME SALES PACE SLOWS

There was good news beneath the 1.9% September decrease reported by the National Association of Realtors. Residential resales have increased 10.7% in the past 12 months, 25.0% with distressed sales factored out. Distressed sales made up 14% of the market last month compared to 24% a year before. The median sale price was $199,200 last month, improving 11.7% in a year.3

  

DURABLES & INVENTORIES: GOOD NEWS

September saw a 3.7% jump in durable goods orders (albeit a 0.1% retreat minus transportation orders). The Commerce Department also said wholesale inventories rose 0.5% in August, a hint that businesses and suppliers expect solid holiday sales.2

     

ANOTHER RECORD CLOSE FOR THE S&P 500

Rising 0.88% for the week, the S&P settled at a new peak of 1,759.77 Friday, and both the DJIA (+1.11% to 15,570.28) and NASDAQ (+0.74% to 3,943.36) advanced with it. Friday’s NASDAQ close represented a 13-year high.2

  

THIS WEEK: Apple, Merck and Herbalife announce earnings Monday, which is also when NAR issues its September pending home sales report. Tuesday brings earnings from Nokia, Baidu, Pfizer, Gilead, Aflac, BP, Deutsche Bank, UBS, Electronic Arts, LinkedIn and Yelp plus the September PPI, September retail sales figures, the Conference Board’s October consumer confidence poll and the August S&P/Case-Shiller home price index. On Wednesday, the Federal Reserve makes a policy statement and the September CPI and October ADP employment change report appear; Facebook, General Motors, Allstate, GlaxoSmithKline, Barclays, Comcast, Visa, Expedia, Kraft Foods, Boeing and AT&T are out with earnings. October’s Challenger job-cut report arrives Thursday, along with a new initial claims report and quarterly results from ExxonMobil, MasterCard, ConocoPhillips, Sony, Starbucks and AIG. On Friday, November kicks off with Q3 results from Chevron, the October ISM manufacturing index and Commerce Department figures on October car and truck sales.

  

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+18.82

+18.82

+17.17

+6.25

NASDAQ

+30.60

+32.06

+30.82

+11.14

S&P 500

+23.39

+24.54

+20.14

+7.10

REAL YIELD

10/25 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.34%

-0.63%

3.02%

1.92%

 

Sources: usatoday.com, bigcharts.com, treasury.gov - 10/25/134,5,6,7

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends.

 

 

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MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@natplan.com.

www.mid-america.us

Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Advisor.

MidAmerica Financial Resources, SunAmerica, and Malan Financial Group are separate and unrelated companies to NPC.

 

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 - stream.wsj.com/story/latest-headlines/SS-2-63399/SS-2-360718/ [10/22/13]

2 - tinyurl.com/lqwsp7p [10/25/13]

3 - usatoday.com/story/money/business/2013/10/21/september-existing-single-family-home-sales/3141663/ [10/21/13]

4 - usatoday.com/money/markets/overview/ [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F25%2F12&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F25%2F12&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F25%2F12&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F24%2F08&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F24%2F08&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F24%2F08&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F24%2F03&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F24%2F03&x=0&y=0 [10/25/13]

5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F24%2F03&x=0&y=0 [10/25/13]

6 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [10/25/13]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [10/25/13]

 

 

 

 

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