Estate Planning

Wholesale inflation eased significantly in February, slowing more than expected. The producer price index for final demand was flat month-over-month, down from 0.6% in January and lower than the 0.3% forecast. On an annual basis, headline PPI increased 3.2%, down from 3.7% in January and below the 3.3% forecast.

The Consumer Price Index for Urban Consumers (CPI-U) release for February puts the year-over-year inflation rate at 2.82%. The latest reading keeps inflation below the 3.73% average since the end of the Second World War. Additionally, inflation now sits below the 10-year moving average which is now at 2.93%.

Inflation affects everything from grocery bills to rent, making the Consumer Price Index (CPI) one of the most closely watched economic indicators. The Bureau of Labor Statistics (BLS) tracks this by categorizing spending into eight categories, each weighted by its relative importance.

Inflation cooled for the first time in five months in February. According to the Bureau of Labor Statistics, the headline figure for the Consumer Price Index was at 2.8% year-over-year, lower than the expected 2.9% growth. Core CPI also came in lower than expected, cooling to 3.1% year-over-year.

The NFIB Small Business Optimism Index dropped for a second straight month, falling to 100.7 in February. While optimism among small business owners moderated last month, uncertainty spiked to its second highest reading of all time.

Multiple jobholders account for 5.5% of civilian employment, the highest level since 2009. The survey captures data for four subcategories of the multi-job workforce, the relative sizes of which we've illustrated in a pie chart.

Let's take a close look at February's employment report numbers on Full and Part-Time Employment. The latest data shows that 82.5% of total employed workers are full-time (35+ hours) and 17.5% of total employed workers are part-time (<35 hours).

Travel on all roads and streets increased in December. The 12-month moving average was up 0.13% month-over-month and was up 0.99% year-over-year. However, if we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) was up 0.07% MoM and up 0.38% YoY.

The moving average for vehicle sales per capita series peaked in August 1978. Fast forward more than 45 years, it is now down 37.2% from that peak.

The U.S. trade deficit widened more than expected, as a surge in imports exceeded a smaller increase in exports. In January, the trade deficit expanded 34.0% to -$131.4B, the largest one month jump since 2015 and the largest deficit on record. 

The 10-year Treasury yield has experienced dramatic fluctuations, ranging from a peak of 15.68% in October 1981, during the height of the Volcker era, to a historic low of 0.55% in August 2020, amidst the economic uncertainty of the pandemic. As of February 28, 2025, the weekly average stood at 4.31%.

The Institute for Supply Management (ISM) manufacturing purchasing managers index (PMI) came in at 50.3 in February, indicating marginal expansion in U.S. manufacturing for a second straight month. The latest reading was worse than the forecast of 50.6.

The U.S. manufacturing sector grew at its fastest rate since June 2022 in February. The S&P Global U.S. Manufacturing PMI rose for a second straight month to 52.7, exceeding the 51.6 forecast.

With the release of January's report on personal incomes and outlays, we can now take a closer look at "real" disposable personal income per capita. At two decimal places, the nominal 0.84% month-over-month change in disposable income comes to 0.51% when we adjust for inflation, the largest monthly gain in a year. The year-over-year metrics are 3.58% nominal and 1.05% real, the lowest level since 2022.

The BEA's core Personal Consumption Expenditures (PCE) Price Index for January showed that core inflation continues to be above the Federal Reserve's 2% long-term target at 2.6%. The January core Consumer Price Index (CPI) release was higher, at 3.3%. The Fed is on record as using core PCE data as its primary inflation gauge.

The Chicago Purchasing Managers’ Index (Chicago Business Barometer) rose for a second straight month in February but remains historically low. The index increased to 45.5 from 39.5 in January, surpassing the 40.5 forecast. The index remained in contraction territory for a 15th consecutive month.

The BEA's Personal Income and Outlays report showed inflation remained elevated at the start of 2025. The Fed’s preferred inflation gauge, the PCE price index, rose 2.5% year-over-year in January and 0.3% from December, as expected.

Personal income (excluding transfer receipts) rose 0.7% in January and is up 4.0% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, real personal income (excluding transfer receipts) was up 0.4% month-over-month and up 1.5% year-over-year.

The second estimate for Q4 GDP came in at 2.35%, a deceleration from 3.07% for the Q3 final estimate. With a per-capita adjustment, the headline number is lower at 1.71%, a slowdown from 2.22% for the Q3 headline number.

Real gross domestic product (GDP) is comprised of four major subcomponents. In the Q4 GDP second estimate, three of the four components made positive contributions.

New orders for manufactured durable goods rose to $286.00B in January. This represents a 3.1% increase from the previous month and a 3.4% rise from one year ago. The latest reading was better than the expected 2.0% growth.

The National Association of Realtors® (NAR) pending home sales index fell more than expected in January, dropping to its lowest level on record. The index came in at 70.6, a 4.6% decline from the previous month and a 5.2% drop from one year ago. Pending home sales were expected to fall 0.9% month-over-month.

The Kansas City Fed Manufacturing Survey continued to decline in February, with the composite index remaining at -5, unchanged from January. Despite this, future expectations stayed positive, though they dipped slightly from 15 in January to 14 in February.

New home sales fell more than expected while prices jumped to a two-year high last month. According to the Census Bureau, new home sales were at a seasonally adjusted annual rate of 657,000 in January, below the 679,000 forecast. This represents a 10.5% decline from December's upwardly revised rate of 734,000 and a 1.1% drop from one year ago.

Fifth district manufacturing activity improved in February, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite manufacturing index rose to 6 this month from -4 in January, the largest one month increase in over three years. This month's reading was better than the forecast of -3 and is the highest reading since April 2022.

The Conference Board's Consumer Confidence Index® dropped sharply in February, falling for a third straight month. The index decreased to 98.3 this month from January's upwardly revised 105.3. This month's reading was worse than the 102.7 forecast.

Home prices continued to trend upwards in December as the benchmark national index rose for a 23rd consecutive month to a new all-time high. The seasonally adjusted home prices for the national index saw a 0.5% increase MoM, and a 4.0% increase YoY. After adjusting for inflation, the MoM fell to 0.2% and YoY fell to -0.8%.

The Federal Housing Finance Agency (FHFA) house price index (HPI) rose to 436.1 in December, reaching a new all-time high. U.S. house prices were up 0.4% from the previous month and up 4.7% from one year ago. However, after adjusting for inflation, the real index was lower at 201.8, a record high. Real house prices were flat month-over-month and up 2.8% year-over-year.

The Dallas Fed released its Texas Manufacturing Outlook Survey (TMOS) for February. The general business activity index came in at -8.3 after rising notably in January. This marks a 22.4 point decline from the previous month, the sharpest monthly drop since March 2020.

Household debt increased by $93 billion (0.52%) in Q4 2024, reaching $18.04 trillion. While all debt categories saw quarterly gains, the overall rise was primarily driven by credit card debt.

This series has been updated to include the January release of the consumer price index as the deflator and the monthly employment update. The latest hypothetical real (inflation-adjusted) annual earnings are at $51,657, down 7.0% from over 50 years ago.

The Census Bureau released its latest quarterly report for Q4 2024 showing the latest homeownership rate is at 65.7%, up from Q3 but practically unchanged from a year ago.

The median US income in 2023 was $80,610, up from $22,420 in 1984 — a 260% rise over the 39-year time frame. However, if we adjust for inflation chained in 2023 dollars, the 1984 median is $55,828, and the increase drops to 37%.

What is the relationship between education and household income? The Census Bureau’s 2023 annual survey data provides valuable insights into this question. The median household income for individuals aged 25 and older was $82,010, but how does this figure vary based on educational attainment?

The median household is the statistical center of the Middle Class. Let's take a closer look at the Census Bureau's latest annual household income data with a focus on middle class income. In this update, we'll focus on the growing gap between the median (middle) and mean (average) household incomes across the complete time frame of the Census Bureau's annual reporting from 1867 to 2023.

Our commentary on household income distribution offers some fascinating insights into average U.S. household incomes, but misses the implications of age for income. In this update, we examine household income with a focus on age bracket.

A few months ago, the Census Bureau released its annual report on household income data for 2023. During 2023, the median (middle) average household income rose 8.0% to $80,730. Let's take a closer look at the quintile averages, which dates from 1967, along with the statistics for the top 5%.

This chart series features an overlay of four major secular bear markets: the Crash of 1929, the Oil Embargo of 1973, the Tech Bubble, and the Financial Crisis. The numbers are through the December 31, 2024 close.

The Conference Board Leading Economic Index (LEI) increased slightly in November. The index rose 0.3% from the previous month to 99.7 after eight consecutive monthly declines.