PEEK OF THE WEEK
July 31, 2017
Leif Hagen & Donna Roberts
The Markets
There was some good news and some bad news last week.
First,
the good news: Thanks to consumer spending and an upturn in federal government
spending, the U.S. economy grew faster from April through June this year. Gross
domestic product (GDP) grew by 2.6 percent during the period, according to the
advance estimate for economic growth. This was an improvement over growth from
January through March, when GDP increased by 1.2 percent.
Now,
the bad news: Personal income did not grow as fast from April through June as
it did from January through March. Wages and salaries grew at a slower pace, as
did government social benefits and other sources of income. The New York Times wrote:
“Wage
growth, however, decelerated despite an unemployment rate that averaged 4.4
percent in the second quarter. Inflation also retreated, appearing to weaken
the case for the Federal Reserve to raise interest rates again this year.
‘Although
growth is solid, the lack of wage pressure buys the Fed plenty of time, and
works with a very 'gradual' tightening cycle,’ said Alan Ruskin, global head of
G10 FX strategy at Deutsche Bank in New York. ‘There is more here for the Fed
doves than the hawks.’”
The
Federal Reserve Open Market Committee left rates unchanged at its meeting last
week, commenting, “The stance of monetary policy remains accommodative, thereby
supporting some further strengthening in labor market conditions and a
sustained return to 2 percent inflation.”
The
Standard & Poor’s 500 Index finished the week flat. Yields on 10-year
Treasury bonds moved slightly higher.
Data as of 7/28/17
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
|
Standard
& Poor's 500 (Domestic Stocks)
|
0.0%
|
10.4%
|
13.9%
|
7.7%
|
12.3%
|
5.3%
|
|
Dow
Jones Global ex-U.S.
|
0.2
|
16.3
|
17.1
|
-0.1
|
5.6
|
-0.6
|
|
10-year
Treasury Note (Yield Only)
|
2.3
|
NA
|
1.5
|
2.5
|
1.5
|
4.8
|
|
Gold
(per ounce)
|
1.3
|
9.1
|
-5.7
|
-1.0
|
-4.8
|
6.7
|
|
Bloomberg
Commodity Index
|
1.8
|
-3.5
|
1.3
|
-13.2
|
-10.3
|
-6.8
|
|
DJ
Equity All REIT Total Return Index
|
0.4
|
6.3
|
-1.2
|
8.7
|
9.8
|
7.2
|
S&P 500, Dow Jones Global ex-US,
Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does
not pay a dividend) and the three-, five-, and 10-year returns are annualized;
the DJ Equity All REIT Total Return Index does include reinvested dividends and
the three-, five-, and 10-year returns are annualized; and the 10-year Treasury
Note is simply the yield at the close of the day on each of the historical time
periods.
Sources: Yahoo! Finance, Barron’s,
djindexes.com, London Bullion Market Association.
Past performance is no guarantee of
future results. Indices are unmanaged and cannot be invested into directly. N/A
means not applicable.
cooking illiteracy could improve happiness…What does heavy cream become when you whip it? If you
answered ‘whipped cream,’ try this one: What does whipped cream become when you
whip it a little longer? If you said, ‘butter,’ congratulations! You may
possess above average knowledge of cooking.
You
may have heard about the death of the culinary arts. According to various
surveys and news reports, few people today possess the skills required to boil
an egg. In 2014, The Seattle Times
reported:
“As
cooking has been rendered optional – the victim of rising restaurant culture,
myriad takeout options, and supermarket sections packed with pre-cut
vegetables, shredded cheese, and prepared foods – [cooking instructors] say
cooks are increasingly losing touch with skills considered basic, or even
essential, just a generation or two ago. And that is changing the way…recipes
are developed and written.”
It’s
also changing the restaurant industry. An April 2017 survey from Morgan Stanley found demand for online
order and delivery from restaurants is growing rapidly. By 2020, digital food
delivery may comprise “…40 percent of total restaurant sales – or $220
billion…compared with current sales of around $30 billion.”
Before
you lament the ignorance of today’s youth, consider the results of seven
surveys, completed by Harvard University
and the University of British Columbia,
encompassing more than 6,000 respondents in four countries. The Washington Post reported:
“Across
all surveys, life satisfaction was typically higher for people who regularly
spend money to save time. This was true regardless of household income, hours
worked per week, marital status, and number of children living at home…working
adults in the United States reported higher life satisfaction if they regularly
paid to outsource household tasks such as cooking, shopping, and general
maintenance.”
This may be the new math. Spending money to increase ‘free’
time equals improved happiness.
Weekly
Focus – Think About It
“Cooking with kids is not just about
ingredients, recipes, and cooking…it's about harnessing imagination,
empowerment, and creativity.”
--Guy Fieri, Founder of Cooking with Kids
Foundation
Best Regards,
Leif M. Hagen
Leif M. Hagen, CLU, ChFC
LP Financial Advisor
Securities offered through LPL Financial Inc., Member FINRA/SIPC.
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* This newsletter was
prepared by Peak Advisor Alliance. Peak Advisor Alliance is not affiliated with
the named broker/dealer.
* The Standard & Poor's
500 (S&P 500) is an unmanaged group of securities considered to be
representative of the stock
market in general. You cannot invest directly in this index.
* The Standard & Poor’s
500 (S&P 500) is an unmanaged index. Unmanaged index returns do not reflect
fees,
expenses, or sales charges.
Index performance is not indicative of the performance of any investment.
* The 10-year Treasury Note
represents debt owed by the United States Treasury to the public. Since the
U.S.
Government is seen as a
risk-free borrower, investors use the 10-year Treasury Note as a benchmark for
the long-term bond market.
* Gold represents the
afternoon gold price as reported by the London Bullion Market Association.
The gold price is set twice
daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in
U.S. dollars per fine troy ounce.
* The Bloomberg Commodity
Index is designed to be a highly liquid and diversified benchmark for the
commodity futures market. The Index is composed of futures contracts on 19
physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT
Total Return Index measures the total return performance of the equity
subcategory of the Real Estate Investment Trust (REIT) industry as calculated
by Dow Jones.
* Yahoo! Finance is the
source for any reference to the performance of an index between two specific
periods.
* Opinions expressed are
subject to change without notice and are not intended as investment advice or
to predict future performance.
* Economic forecasts set
forth may not develop as predicted and there can be no guarantee that strategies
promoted will be successful.
* Past performance does not
guarantee future results. Investing involves risk, including loss of principal.
* You cannot invest directly
in an index.
* Consult your financial
professional before making any investment decision.
* Stock investing involves
risk including loss of principal.
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Sources:
