Weekly Market Update - October 9, 2019

Greetings!

It was a “good” jobs number, but apparently not “too good” of a number for stock market watchers. A “good” number suggests the USA is not sliding towards a recession, while a “too good” number might result in the Federal Reserve deciding that another interest rate cut is not needed at their next scheduled meeting. On Friday (10/04/19) the government reported US employers hired a net 136,000 new employees in September 2019, the nation’s 108th consecutive month of positive jobs gains, but below the nation’s average of 161,000 hires per month this year. The reaction from stock market traders – another rate cut is still in the cards. The Fed next meets in 3 weeks (source: Department of Labor).

Domestic stocks rallied on last week’s jobs report, leaving the S&P 500 up +19.6% YTD (total return). However, the majority of the gain for the stock index was achieved during the first 4 months of the year – through 4/30/19, the S&P 500 index had gained +18.3%. Since the end of April, stocks (using the S&P 500) have gained just +1.1% while bonds (using the Barclays Aggregate Bond Index) have gained +6.2% (source: BTN Research).

The national debt as of 9/30/19 (i.e., the end of fiscal year 2019) was $22.7 trillion, up $1.2 trillion in the last 12 months, up $4.9 trillion in the last 5 years, and up $10.8 trillion in the last 10 years (source: Treasury Department).

Notable Numbers for the Week:

  1. IS THAT ENOUGH? - 58% of 1,015 Americans surveyed in August 2019 believe that a retiree who has accumulated $1 million in pre-tax investment accounts will be able to enjoy a “comfortable” lifestyle in retirement (source: TD Ameritrade).

  2. HEALTH INSURANCE - The average annual cost for health insurance coverage for a family plan in 2019 is $20,576, with the employer paying 71% of the total ($14,561) and the employee paying 29% ($6,015). Ten years ago (2009), the average cost was $13,375 and the employer/employee split was 74/26 (source: Kaiser Family Foundation).

  3. ALL IN THE FAMILY – One political party has controlled the White House, the Senate and the House of Representatives in 22 of the last 60 years, i.e., 1960-2019. Republicans last controlled the White House, the Senate and the House in 2018. Democrats last controlled all 3 in 2010 (source: BTN Research).

  4. WAY OFF - In January 2009, the Congressional Budget Office released a 10-year forecast for our nation’s national debt. The debt projection made in 2009 for the end of fiscal year 2019 (i.e., 9/30/19) was $15.973 trillion. Our actual national debt as of 9/30/19 was $22.719 trillion (source: The Budget and Economic Outlook from the Congressional Budget Office).

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