Hey kid! Move out your momma’s house and go get a haircut!
The U.S. economy is suffering a service interruption. Consumer spending on services -- everything from rents and water bills to health care and haircuts -- has lagged as the economy has struggled to recover from the worst recession since the Great Depression. Such expenditures adjusted for inflation have risen 6.3 percent since mid-2009, compared with a 34 percent surge in outlays on durable goods such as automobiles and appliances, according to data from the U.S. Commerce Department.
A turnaround in outlays for services is key to the economy breaking free of the roughly 2 percent growth rut it’s been stuck in over the past 4 1/2 years and achieving what economists call escape velocity. (Escape velocity: the hot new macro-economic buzzword. In the U.S. it probably means a couple of quarters GDP growth north of 2.5/3 percent)
Spending on services have been held back by a slowdown in new household formation and meager wage growth. As young adults stay home with their parents rather than forging out on their own, spending on utilities and amenities such as cable television has languished. Expenditures on housing-related services, mainly rents and utilities such as electricity, made up more than a quarter of personal consumption of services in 2012. Those outlays have been hit most directly by the slowdown in new household formation. From 2008 through this year, the annual rise in the number of households has averaged less than 1 percent. That compares with an average year-over-year gain of about 1.7 percent in Census Bureau data going back to 1948.
Oh yeah, the market did some stuff today too. U.S. stocks were mostly up. Foreign stocks were mostly down. Bonds were mostly up. Gold & Silver were up. Crude up, Gas down. Currencies spent. And the Russians went down!
Enjoy your weekend!
Ticker | Last | Change | % Chg Today | % Chg 1Year | | |
STOCK MARKETS | | | | | | |
Dow Jones Industrial Average | INDU Index | 15755.360 | 15.9300 | 0.1012 | 19.7175 | |
S&P 500 Index | SPX Index | 1777.420 | 1.9200 | 0.1081 | 25.0083 | |
NASDAQ 100 Index | NDX Index | 3456.401 | -3.8910 | -0.1124 | 30.2757 | |
NASDAQ Composite Index | CCMP Index | 4000.975 | 2.5720 | 0.0643 | 33.7493 | |
Russell 3000 Index | RAY Index | 1063.550 | 0.7700 | 0.0725 | 26.6906 | |
Russell 1000 Index (Large Cap) | RIY Index | 989.510 | 0.4900 | 0.0495 | 26.0699 | |
Russell 2000 Index (Small Cap) | RTY Index | 1107.100 | 3.8300 | 0.3472 | 34.3642 | |
Wilshire 5000 Total Market | W5000 Index | 18893.420 | 21.5500 | 0.1142 | 27.0890 | |
TREASURIES | % Yield | | | | | |
3 Month Treasury | 0.0659 | | -0.0050 | -7.6923 | | |
6 Month Treasury | 0.0862 | | -0.0050 | -5.8824 | | |
2 Year Treasury | 0.3222 | 99.852 | -0.0078 | -0.0078 | | |
5 Year Treasury | 1.5309 | 98.664 | 0.0156 | 0.0158 | | |
10 Year Treasury | 2.8673 | 99.000 | 0.0938 | 0.0948 | | |
30 Year Treasury | 3.8731 | 97.813 | 0.3438 | 0.3527 | | |
ENERGY | | | | | | |
Crude Oil, Brent Index | Brent Crude | 108.790 | 0.1200 | 0.1104 | 7.6155 | |
Crude Oil, Louisiana Lt. Sweet | LA Lt Sweet | 100.990 | -0.9600 | -0.9416 | -7.2600 | |
Natural Gas, Henry Hub Index | Nat Gas | 4.381 | -0.0280 | -0.6351 | 8.1719 | |
PRECIOUS METALS | | | | | | |
Spot Gold $/oz | GOLD | 1238.220 | 12.7000 | 1.0363 | -27.1640 | |
Spot Silver $/oz | SILVER | 19.713 | 0.2035 | 1.0431 | -39.5252 | |
CURRENCIES | | | | | | |
Euro | EUR Curncy | 0.728 | 0.0007 | 0.0963 | -4.7731 | |
Japanese Yen | JPY Curncy | 103.200 | -0.1800 | -0.1741 | -18.9613 | |
British Pound | GBP Curncy | 0.614 | 0.0020 | 0.3270 | -1.0796 | |
Swiss Franc | CHF Curncy | 0.890 | 0.0007 | 0.0787 | 3.7524 | |
Canadian Dollar | CAD Curncy | 1.060 | -0.0044 | -0.4136 | -7.0147 | |
Chinese Renminbi | CNY Curncy | 6.071 | -0.0002 | -0.0033 | 2.8908 | |
FOREIGN INDICIES | | | | | | |
EURO STOXX 600 INDEX | EUROPE | 309.750 | -0.4900 | -0.1579 | 10.7714 | |
EURO STOXX TOTAL MARKET | EUROPE | 303.070 | -0.4900 | -0.1614 | 11.2184 | |
FTSE 100 INDEX | UK | 6439.960 | -5.2900 | -0.0821 | 8.6068 | |
CAC 40 INDEX | FRANCE | 4059.710 | -9.4100 | -0.2313 | 11.4347 | |
DAX INDEX | GERMANY | 9006.460 | -10.5400 | -0.1169 | 18.7877 | |
NIKKEI 225 INDEX | JAPAN | 15403.110 | 61.2900 | 0.3995 | 58.1825 | |
HANG SENG INDEX | HONG KONG | 23245.960 | 27.8400 | 0.1199 | 2.8310 | |
TEL AVIV 100 INDEX | ISRAEL | 2196.075 | -6.7210 | -0.3051 | 2.1133 | |
SHANGHAI COMP INDEX | CHINA | 2196.075 | -6.7210 | -0.3051 | 2.1133 | |
RUSSIAN RTS INDEX | RUSSIA | 1391.140 | -0.7100 | -0.0510 | -7.2375 | |
| Last | Chg Today | % Chg Today | 3 Mo Tot Ret | 6 Mo Tot Ret | YTD Tot Ret |
S&P 500 INDEX | 1777.420 | 1.920 | 0.1081 | 5.6707 | 9.584 | 26.991 |
S&P 500 CONSUMER DISCRETION | 509.360 | 1.378 | 0.2712 | 7.5617 | 15.094 | 37.621 |
S&P 500 CONSUMER STAPLES | 432.960 | -1.080 | -0.2488 | 4.3703 | 4.750 | 23.156 |
S&P 500 ENERGY | 623.300 | -2.390 | -0.3820 | 2.6094 | 6.449 | 19.552 |
S&P 500 FINANCIALS | 284.010 | 0.370 | 0.1304 | 5.3212 | 7.832 | 30.810 |
S&P 500 HEALTH CARE | 621.050 | 0.250 | 0.0403 | 5.6021 | 11.737 | 36.777 |
S&P 500 INDUSTRIALS | 429.860 | 1.600 | 0.3736 | 8.6746 | 15.583 | 33.428 |
S&P 500 INFO TECHNOLOGY | 556.390 | -1.540 | -0.2760 | 7.7653 | 11.394 | 22.165 |
S&P 500 MATERIALS | 276.420 | 1.160 | 0.4214 | 4.9202 | 10.616 | 18.966 |
S&P 500 TELECOM SERVICES | 150.850 | -0.470 | -0.3106 | 0.7552 | -3.695 | 8.178 |
S&P 500 UTILITIES | 189.080 | -0.270 | -0.1426 | 1.8694 | 0.980 | 10.722 |
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“The early bird gets the worm, but the second mouse gets the cheese.” ~ Jon Hammond
John Broussard
Assistant State Treasurer
Chief Investment Officer
State of Louisiana
Department of the Treasury
225-342-0013
jbroussard@treasury.state.la.us
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