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Weekly Economic Update

MidAmerica Financial Resources Presents:

 

WEEKLY ECONOMIC UPDATE

 

 

 

WEEKLYQUOTE

“If you laugh, you think, and you cry, that’s a full day.”

- Jim Valvano

 

 

WEEKLYTIP

Do you really need weekly housecleaning service, a gardener, or a dog walker? The money you save by not using these services could go toward debts, an emergency fund, or investing.

 

 

WEEKLYRIDDLE

It traveled from Kentucky to Texas in three days, and it did so while staying in a corner. What is it?

 

Lastweek’sriddle:

Wilbert was driving a black car. The car’s lights were off, there was no moonlight – and a cat was in the middle of the road. How did Wilbert know to stop?

 

Lastweek’sanswer:

He was driving during the day.

 

 

 

 

April 27, 2015

NEW HOME SALES DROP, RESALES CLIMB

March brought a 6.1% advance for existing home sales according to the National Association of Realtors. This happened with a 4.6-month inventory of homes for resale, which is underneath the 6-month level characteristic of a thriving housing market. New home purchases tumbled 11.4% in March after a great February; on the bright side, there were more new home sales in the first quarter than in Q1 2014.1

ORDERS FOR DURABLES INCREASE

The 4.0% March gain noted by the Census Bureau was welcome. From November through February, overall hard goods orders declined by 1.4% or more each month (excepting January’s 2.8% increase).2

OIL ADVANCES, GOLD RETREATS

In New York, oil prices rose 2.5% from April 20-24 on inventory concerns: light sweet crude for July delivery settled Friday at $57.15 on the NYMEX. Gold lost 2.4% last week to a Friday close of $1,175.00 on the COMEX.3

TECH EARNINGS GIVE BIG LIFT TO NASDAQ

That benchmark rose 3.25% last week, briefly topping the 5,100 level on the way to a close of 5,092.09 Friday. Five-day gains also came for the Dow (1.42% to 18,080.14) and S&P 500 (1.75% to 2,117.69).4

THIS WEEK: On Monday, Apple, Container Store, Hertz Global, MGM Resorts, Universal Health Services and Barracuda Networks report earnings. Tuesday brings a new Conference Board consumer confidence survey, February’s S&P/Case-Shiller home price index and earnings from Aetna, Aflac, Big 5, Bristol-Myers Squibb, UPS, Edison International, Smart & Final, Ford Motor Co., Buffalo Wild Wings, Panera, Cummins, Coach, Supervalu, Ally, Akamai, NCR, Genworth, Pfizer, Twitter, GoPro, JetBlue, Revlon, Kraft, Whirlpool, U.S. Steel, T-Mobile, Merck, Sirius XM, Wynn Resorts, Western Digital and Valero. Wednesday offers a Federal Reserve policy statement, an estimate of Q1 GDP, March pending home sales numbers and earnings from Anthem, Baidu, General Dynamics, Yelp!, Goodyear, Fiat Chrysler, GrubHub, Hilton, Humana, Praxair, Time Warner, Starwood Hotels & Resorts, Marriott and Northrup Grumman. Thursday presents March personal spending data, new initial claims figures and earnings from Avon, Visa, Colgate-Palmolive, Diebold, Coca-Cola, LiveNation, Time Warner Cable, ExxonMobil, Expedia, Virgin America, Fluor, HealthSouth, Pitney-Bowes, Public Storage, ConocoPhillips, Blackrock, Magellan Health, Marathon Petroleum, Nutrisystem and Cigna. Friday offers the University of Michigan’s final April consumer sentiment index, ISM’s April factory PMI and results from Berkshire Hathaway, Chevron, Clorox, CVS and Weyerhaeuser.

 

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+1.44

+9.57

+12.27

+7.65

NASDAQ

+7.52

+22.75

+20.25

+16.10

S&P 500

+2.86

+12.73

+14.79

+8.22

REAL YIELD

4/24 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.04%

0.49%

1.47%

1.63%


Sources: online.wsj.com, bigcharts.com, treasury.gov - 4/24/155,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

 

 

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Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Adviser.
MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to NPC.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Citations.

1 - arkansasonline.com/news/2015/apr/24/u-s-new-home-sales-fall-11-4-20150424/ [4/24/15]

2 - investing.com/economic-calendar/durable-goods-orders-86 [4/24/15]

3 - proactiveinvestors.com/companies/news/61155/gold-drops-16-to-1175-wti-decreases-1-to-5715-61155.html [4/24/15]

4 - markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [4/24/15]

5 - markets.wsj.com/us [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F24%2F14&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F24%2F14&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F24%2F14&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F23%2F10&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F23%2F10&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F23%2F10&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F25%2F05&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F25%2F05&x=0&y=0 [4/24/15]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F25%2F05&x=0&y=0 [4/24/15]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [4/24/15]

8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [4/24/15]

 

 


Reining in Your Debt

Reining in Your Debt

Americans are spending freely again. That has a downside.

 

Provided by MidAmerica Financial Resources

 

As the Great Recession faded, American household debt gradually decreased. In fact, it declined by $1 trillion between mid-2008 and mid-2014, according to the Federal Reserve.1

 

Now household debt is increasing once more. The Fed found it climbing by $78 billion (0.7%) during Q3 2014.1

 

On the macroeconomic level, that can be interpreted as a positive: it hints at greater consumer spending, easier credit, and more lending taking place to accommodate consumer borrowers. On a microeconomic level, it is more troublesome. It may mean a change in perception, with debt not seeming as onerous as it once did.

 

If households really are looking at debt through rosier-colored glasses, they might do well to remember an inescapable fact. When they use a credit card or take out a consumer loan, they are borrowing money they do not have for things they do not absolutely need. The average indebted U.S. household was carrying $15,611 in credit card debt alone in December, the Fed notes. Even if Mom or Dad is a business owner or self-employed entrepreneur, that is an awful lot of revolving debt for a couple or family.2

   

There are only two ways to reduce debt. One is spending less, the other paying it down. The first tactic requires a change in habits; the second usually requires more income. 

   

How about not buying 20% of what you want? Or alternately, paying for everything in cash? Either strategy might reduce your household debt significantly in a given month.

             

Where can you find more income? Life may allow you to take on an additional, part-time job – or a higher-paying one. Most people do not have either option at their disposal, so they must look for additional short-term or recurring income derived from consumer savings: they stop eating out or drinking lattes, they stop subscribing to cable or keeping up health club memberships they seldom use, they elect not to buy any clothing for a few months, vacation locally or drive the same car for a decade. All that can put more money in a family’s pockets.

    

Most households lack budgets. Rather than being old-fashioned or bothersome, they are instrumental in determining spending patterns and opportunities for savings. What is mysterious about your personal finances can clear up with a budget, and you get the sense of being on top of your financial life.

 

Debt can be managed. When you look at your spending habits, ideas to reduce it, control it and defeat it will surface.

       

MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@natplan.com.

www.mid-america.us

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

    

Citations.

1 - news.investors.com/investing-personal-finance/010215-732937-cut-debt-and-manage-household-spending-and-budget-in-2015.htm [1/2/15]

2 - nerdwallet.com/blog/credit-card-data/average-credit-card-debt-household/ [3/19/15]

 





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