Monday Update (on Tuesday): Housing Strong, Business Slow

May 31, 2016

Last week’s data was more mixed than in recent weeks, with continued positive news in the housing market offset by weaker-than-expected results in business investment. On balance, both the strong trends in consumer demand and the relative weakness in business continue, and the economy was shown to have done better in the first quarter than was originally thought.

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Memorial Day Reflections

May 27, 2016

I’ve been struggling all morning, trying to decide what to write today. I could talk about oil prices. I could talk about the relationship between consumer confidence and wage growth (not as strong as you’d think). I could talk about the real risks we face as investors and what we should be worrying about.

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Important Vs. Urgent in Investing

May 26, 2016

I’m on the road today, traveling home from the Commonwealth Winners Circle conference in California. Besides hanging out with one of the nicest groups of people on the planet—the Commonwealth community—I got to have some fairly deep conversations about what financial advisors need, what investors need, and the problems both face in preparing for the future.

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Wage Growth and Spending: A Big-Picture Look

May 25, 2016

Recent good news on confidence, spending, and wage growth is real, but it occurred to me looking at my recent posts that I’ve neglected something important: context. Let’s take a look at the bigger picture when it comes to wage growth.

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The Real Story Behind a Fed Rate Increase

May 24, 2016

Another Federal Reserve official, Philadelphia Fed president Patrick Harker, has weighed in on rates, projecting two to three hikes over the rest of 2016, including a June increase. Much of the commentary on his statement and those of other Fed members has focused on the potential effects on the stock market—specifically, the risk that higher rates may pull the market down.

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Monday Update: Better Data Continues

May 23, 2016

Once again, last week’s news was mostly positive, with housing starts and sales beating expectations, industrial production and manufacturing up, and the Fed releasing a surprisingly upbeat set of minutes that painted the U.S. economy as well along the road to recovery.

Combined with the positive results from previous weeks, this good data continues to support a recovery in growth for the second quarter.

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Wall Street’s Songs of the Summer

May 20, 2016

With Memorial Day quickly approaching, it’s about time to break out the boom box and cue up the songs of summer. As a 50-year-old economist, I’m not exactly on the cutting edge of pop culture, so I consulted my younger and (much) hipper friends and colleagues, along with several websites.

Surprisingly, some recent Top 40 hits have a lot to say (intentionally or not) about the economy and the stock market.

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Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not indicative of future results. Diversification does not assure a profit or protect against loss in declining markets. The S&P 500 Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. All indices are unmanaged and investors cannot invest directly into an index.

The MSCI EAFE Index (Europe, Australasia, Far East) is a free float‐adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consists of 21 developed market country indices.  


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