How can investors navigate volatility arising from late-cycle fiscal stimulus?
The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for April. U.S. house prices were up 0.1 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 6.4% (nonseasonally adjusted). Seasonally adjusted, the index is up 4.37% year-over-year.
Russ discusses why economic conditions (for now) support low volatility in the markets.
The economic calendar is modest. Volatility is lower even with plenty of news. The summer doldrums have arrived! It provides time for introspection to fill those empty timeslots and pages.
Let's take a long-term view of household net worth from the latest Z.1 release. A quick glance at the complete data series shows a distinct bubble in net worth that peaked in Q4 2007 with a trough in Q1 2009, the same quarter the stock market bottomed. The latest Fed balance sheet shows a total net worth at an all-time high — 83.5% above the 2009 trough. The nominal Q1 net worth is up 1.0% from the previous quarter and up 7.0% year-over-year.
PepsiCo (PEP) is a Dividend Aristocrat, Champion and blue-chip stalwart that has increased its dividend for 46 consecutive years. Therefore, it should be no surprise that just as we saw with Procter & Gamble in part 5, this blue-chip stalwart has traditionally commanded a higher valuation (earnings multiple) than the average stock.
The last couple of years have been remarkable ones for yields. The 10-year note hit its historic closing low of 1.37% in July of 2016 and then rose 158 BPs to its interim high of 2.95% as of the June 15 close.
I spend a lot of time on the road speaking to our investors and advisors and one of the common questions I get during the Q&A sessions is, “What keeps you up at night?” Aside from having an 18-year old daughter—and being a chronic insomniac anyway—my reply usually centers around debt and the burden it has and will continue to place on our economy.
As expected, the Fed raised short-term interest rates following the June 12-13 policy meeting. Investors were more concerned about the pace of future rate increases and the revised dot plot showed a median of four rate increases in 2018, although (as in the March plot), most fed officials were divided between three and four.
Each year, Social Security’s Trustees report to Congress on the financial status of the program. This typically generates a number of anxiety-provoking media headlines about if/when it will run out of money. Gail Buckner, CFP, our personal retirement and financial planning strategist, takes a look at the facts. She says Social Security is actually in pretty good shape overall.