The Retirement Channel

Median Household Incomes by Age Bracket: 1967-2016

Earlier this week, we updated our commentary on household income distribution to include the Census Bureau's release of the 2016 annual data. Our focus was on arithmetic mean (average) household incomes by quintile (and the top 5%) over the 50-year history of this data series. The analysis offered some fascinating insights into U.S. household incomes. But the classification misses the implications of age for income. Households are by no means locked into the same quintile over time.

A Case for Multi-Asset Investing: The Low-Return Imperative

The data suggests that future market returns are likely to be lower than in the past. Can a multi-asset investing approach help make up the difference?

High Yield Market Update

The U.S. high yield bond market has grown substantially to around $1.3 trillion today. At the same time, the global high yield market has become more geographically diverse. North America’s share of the market has fallen from 87.1% in 2005 to 62.6% in 2016.

Health Care Reform – Right, Left, and Center

Three new health care reform initiatives - from the political right, left, and center - are developing in the Senate. Earlier this week I joined CNBC's Nightly Business Report to discuss the proposal up first for consideration: the Graham-Cassidy bill, which would turn the ACA into a system of state grants.

Weekly Unemployment Claims: Down 23K

Today's seasonally adjusted 259K new claims, down 23K from last week's revised 282K, was better than the forecast of 300K. Hurricane Harvey and Irma impacted this week's claims.

Five Decades of Middle-Class Wages: August 2017 Update

We've updated this series to include Thursday's release of the Consumer Price Index as the deflator and the August monthly update. The latest hypothetical real (inflation-adjusted) annual earnings are at $37,272, down 12.6% from 44 years ago.

U.S. Debt Tops $20 Trillion - Stocks Soar To Record Highs

We touch on several bases in today’s letter that are not entirely related. We begin with the 800-pound gorilla in the room – the fact that the US national debt topped $20 trillion last week.

Retirement & CEFs

Adding closed-end funds to your investment portfolio may be a way to help boost your retirement income, industry pros say.

Weighing the Week Ahead: Will a More Aggressive Fed Spark the Long-Awaited Correction?

We have a light calendar for economic data. The week’s focus will be the FOMC policy announcement on Wednesday. Given the resilience of the market rally in the face of various natural and human threats, the punditry will turn to a favored topic. Expect people to be asking: Will the Fed be the catalyst for a market correction?

The “Big Lie” Of Market Indexes

The “Big Lie” is that you can “beat an index” over an extended period of time. You can’t, ever. Let me explain.

Eyes Wide Shut

At the October 2002 market low, the S&P 500 stood -49.2% below its March 2000 peak (-48.0% including dividend income), with the Nasdaq 100 having lost more than -82.8% from its high, on the basis of both price and total return. The loss wiped out the entire total return of the S&P 500, in excess of Treasury bills, all the way back to May 1996.

Pension Storm Warning

Elected officials at all levels have promised workers they will receive pension benefits without taking the hard steps necessary to deliver on those promises. This situation will end badly and hurt many people. Unfortunately, massive snafus like this rarely hurt the politicians who made those overly optimistic promises, often years ago.

The Big Four Economic Indicators: August Real Retail Sales

Note: With today's release of August's Retail Sales and yesterday's release of August Consumer Price Index, we've updated this commentary to include the latest Real Retail Sales. Month-over-month nominal sales in August fell by 0.2% (0.21% to two decimals). Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, decreased by 0.6 (0.61% to two decimals). The chart gives us a close look at the monthly data points in this series since the end of the last recession in mid-2009. The linear regression helps us identify variance from the trend.

The Big Four Economic Indicators: Industrial Production Down 0.9% in August

Today's report on Industrial Production for August shows a 0.9% decrease month-over-month, which was below the consensus of 0.1%. Industrial Production peaked in November 2014, only one point higher than its pre-recession peak in November 2007. The year-over-year change is 1.54 percent, down from last month's YoY increase.

Robo Advice Data Now Available for Advisors

Robo advice is the newest disruptor in the financial industry and many advisors are not sure how to interpret this new investment advice solution. Some are writing it off as a solution for lower asset customers, some are concerned about the competitive threat, while others are embracing the technology for use in their own business.