One of the key indicators I follow is consumer confidence. With more than two-thirds of the economy based on consumer spending, confidence is the key determinant of growth, even more so than jobs. Yes, jobs are important—you can’t spend money if you’re not making it. But to spend the extra money that kicks growth up another notch, you need to have the job and feel confident enough to spend.

Among last week’s important economic data releases, the focus was on July’s existing home sales, durable goods orders, and personal income and spending reports. In a positive sign for the overall economic recovery, personal income and spending showed continued growth during July. This week will be busy once again, with releases that include a look into consumer and business confidence in August, the August employment report, and the international trade report from July.

Yesterday, in response to advisor requests, my post summarized some of my high-level thoughts about the state of the economy. To recap my take briefly, the economic risks of the pandemic are largely in the past. The economy is growing, and markets are strong. Given this environment, the risks of governmental action (notably the infrastructure spending bills) and the Fed’s policy accommodations are now bigger worries than the pandemic. In the face of these risks, can our economic growth continue? My base case is that we’re getting closer and closer to normal. So, today, I want to address how we can invest in a growing economy that faces risks of inflation, higher interest rates, and government policy changes.

Recently, I’ve received several requests for a high-level overview of the economy. As a blog post, this analysis is necessarily short on details, but I hope it provides a big-picture look at what I see happening in the current economic and market environment.

As I wrote in yesterday’s post, we seem to have moved past the pandemic in many ways, but I realized it has been some time since I did an update on what that means. So here we are. Things are bad from a medical perspective, and the big question is whether medical conditions will continue to worsen to the point they affect the economy and markets. Right now, that does not look likely. I will be keeping an eye on the situation, however, and do another update when the answer becomes clearer.

This week, I am at the first Commonwealth conference (or, indeed, any conference) since March 2020. We are being very cautious—events are outdoors, and everyone was tested on arrival. But it is the first real large face-to-face event since then.

There were a number of important economic data releases last week, with a focus on housing, the July retail sales report, and the weekly initial jobless claims report. Initial unemployment claims set a new pandemic-era low during the second week of August, in an encouraging sign for the ongoing labor market recovery. This will be another busy week for updates, with July’s existing home sales, durable goods orders, and personal spending and income reports serving as highlights.

Last week, I happily returned to yet another tradition that was disrupted by COVID-19: back-to-school shopping. Although I did not miss paying for the rapidly changing school wardrobes of two teenage girls last year, I welcomed the feeling of normalcy the shopping routine brought to my family. COVID-19 and its associated restrictions have had a huge impact on children—educationally, socially, emotionally, and physically. We’ve all seen this. But did you know that, because of the pandemic, children may grow up to be worse off financially than their parents?

I originally shared this post back in 2014, but I think you will find it still offers some valuable lessons for today. — Brad

I thought it would be fun to share a couple of videos that offer some entertaining—and surprisingly accurate—lessons in economics. Even better, they do so à la rap!

I'll be on vacation for the rest of the week, so I'll be re-running a couple of my favorite posts. This one is from 2019, but I think the message holds true today. Enjoy! — Brad

I get a lot out of meeting with advisors and clients. It is always good to hear what people are thinking, listen to their concerns, and spend time understanding where real people who live outside of the investment bubble that I inhabit are coming from. The past week spent traveling was a great opportunity to do just that. But sometimes you get more than you expect.

For the second earnings season in a row, we have had blowout results. After an amazingly strong first quarter, the results for the second quarter are coming in even better. As of the end of last week, according to FactSet, 9 of 10 companies (91 percent) had reported. Of these, almost 7 of 8 (87 percent) beat expected earnings. These are the highest levels of beats on earnings seen since the start of records in 2008 and slightly above what we saw last quarter.

Last week saw a number of important economic data releases, with a focus on July’s inflation reports and a first look into consumer confidence in August. Consumer inflation slowed in July compared with data from June, but the overall level of inflation remains elevated. This will be another busy week for updates. Highlights will include reports on the housing sector as well as retail sales in July.

In 2020, the U.S. GDP declined 3.4 percent, yet the S&P 500 was up 18.4 percent. In the first half of 2021, the U.S. GDP grew by 6.4 percent, and the S&P 500 was up by 15.25 percent.

My colleague Sam Millette, manager, fixed income, on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Market Risk Update. Thanks for the assist, Sam!

Over the past couple of weeks, I have gotten a number of questions on inflation. It seems to be one of the top-of-mind issues. Given that, and the fact that the most recent inflation data hit this morning, it seems appropriate to give an update.

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Economic Risk Factor Update. Thanks for the assist, Sam!

Last week saw a number of important economic data releases. Highlights included better-than-expected results for service sector confidence and hiring in July. This will be another busy week for updates, with a focus on July’s Consumer Price Index and Producer Price Index reports, as well as a first look at consumer confidence in August.

July was another dickens of a month—at once the best of times and the worst of times. For the financial markets, the news was largely good. The U.S. markets ended up across the board, hitting new all-time highs during the month. Earnings reports continued to substantially beat expectations. That good news, combined with dropping interest rates, drove markets higher. Bond markets continued to rally on those lower rates. From a financial perspective, July was a very good month here in the U.S.

Today’s post is from Rob Swanke, senior fixed income analyst on our Investment Management and Research team.

The monthly jobs report gives us a good chance to think through where we are in the recovery—and what effect the most recent developments have had. With the next report coming this Friday, what should we be looking for?

Last week’s economic updates touched on a variety of economic sectors. Highlights included better-than-expected results for personal income and spending in June, as well as improved consumer confidence in July. This week will be packed with updates once again, with the focus on July’s business confidence and employment reports.

July was a generally good month for the markets, with all three major U.S. indices up by more than 1 percent. But emerging markets were hit hard and ended the month down significantly. On the economic front, the data remains positive, although business and consumer confidence declined. Further, medical risks are on the rise, with the Delta variant hitting the unvaccinated population.