Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: June 8th, 2020 | 0 Comments

1. KEEPS GOING UP – The S&P 500 has gained +43.4% (total return) through the close of trading last Friday 6/05/20 since falling to a bear market low close on 3/23/20. The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index with each stock’s weight in the index proportionate to its market value (source: source: BTN Research).

2. NOT BUYING IT – 39% of investors surveyed as of last Thursday 6/04/20 are “bearish” on US stocks for the upcoming 6 months (source: American Association of Individual Investors).

3. FUNDING A RETIREMENT – The S&P 500 has averaged +10.2% per year (total return) over the 25 years ending 12/31/19. A lump-sum of $838,914 (in a pre-tax account) will sustain a 20-year payout of $100,000 per year (i.e., $2 million of gross distributions before taxes) assuming the funds continue to earn +10.2% annually. This mathematical calculation ignores the ultimate impact of taxes on the account which are due upon withdrawal, is for illustrative purposes only and is not intended to reflect any specific investment or performance. Actual results will fluctuate with market conditions and will vary (source: BTN Research).

4. SO LOW – As of the close of trading on 6/05/20, the yield on the 10-year Treasury note (0.91%) has been below 2% for 212 consecutive trading days, i.e., since 8/01/19, the longest stretch below 2% in US history. The highest closing yield for the 10-year Treasury note in history was 15.84% on 9/30/81 (source: Treasury Department).

5. OIL – The price of West Texas Intermediate (WTI) crude oil rose from $18.84 a barrel as of 4/30/20 to $35.49 a barrel by 5/31/20 (up $16.65 a barrel), an +88.4% increase. Both monthly gains (by dollar and by percentage) are all-time records for WTI crude. The oil benchmark closed at $39.55 a barrel last Friday 6/05/20 (source: NYMEX).

6. BEING CAREFUL – Spending by Americans in April 2020 dropped a record 13.6% on a month-over-month basis, i.e., $13.90 trillion of “seasonally adjusted annual spending” in March 2020 free-falling to $12.01 trillion in April 2020, a drop of $1.89 trillion. If this level of decline continued for 12 consecutive months, that would mathematically be equal to every American household (there are 124.4 million households in the country) reducing their out-of-pocket spending by $15,200 over the course of a year (source: Commerce Department).

7. HIGHEST EVER – As of the end of April 2020, 43 US states reported their highest unemployment rate in history. US states have measured monthly jobless rates since January 1976 (source: Department of Labor).

8. LESS MONEY – There were 155.8 million Americans who had jobs as of mid-March 2020. 77% of those workers (119.2 million) have “experienced loss of employment income” since 3/13/20, the date of President Trump’s declaration of a national emergency (source: US Census Bureau Household Pulse Survey: May 21-26).

9. JUST WAITING – 23% of millennials surveyed indicate they will not be buying a home “anytime soon” as a result of the COVID-19 pandemic. Millennials were born between 1981-97 and are ages 23-39 in 2020. The survey was compiled from data gathered from 1,300 American adults in April 2020 (source: Quicken.com).

10. GREAT TIME TO BUY – The average interest rate nationwide on a 30-year fixed rate mortgage fell to 3.15% on Thursday 5/28/20, the lowest ever recorded in US history. That means home buyers would pay just $430 per month in “principal and interest” payments for every $100,000 borrowed (source: Freddie Mac).

11. GETTING SMALLER – The median size of 903,000 new single-family homes completed in America during 2019 was 2,301 square feet. A decade earlier, the median size of 520,000 new single-family homes completed during 2009 was 2,417 square feet (source: Census Bureau).

12. PLEASE REMAIN SEATED – The 3/27/20 CARES Act allocated $25 billion to the US airline industry to be used for payroll and benefits of individual airline companies. The $25 billion was allocated to only 11 airlines, with 82% of the money allocated to just 4 airlines (source: CARES Act).

13. PANDEMIC DEATHS – 6,799 Americans died from the COVID-19 pandemic in the 1-week ending last Friday 6/05/20 at 9am ET, bringing the national total to 108,840. The 6,799 deaths were up from 6,539 deaths the prior week, breaking a streak of 6 consecutive weeks of declining deaths (source: Meet the Press – First Read).

14. HARD HIT – Just 2 states – New York and New Jersey – account for 35% of the nation’s COVID-19 deaths as of last Friday morning 6/05/20 at noon ET (source: CovidTracking.com).

15. SAVING MONEY – Brown University of the Ivy League began the 2019-2020 school year with 38 varsity athletic teams. On 5/28/20, Brown eliminated 11 of the 38 varsity teams in a cost-cutting effort (source: Golf Digest).

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