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Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: August 17th, 2020 | 0 Comments

1. FROM THE MARCH LOW – Since bottoming on 3/23/20, the S&P 500 has rallied and gained +51.9% (total return) through the close of stock trading as of last Friday 8/14/20. 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: BTN Research).

2. NOT A SURPRISE – The top 10% of American wage earners (making at least $145,135 annually in pre-tax income) own 88% of the US stock market (source: BCA Research).

3. MOSTLY UP – The bond market has produced a negative total return in just 3 of the last 44 years, i.e., 1976-2019. The down years were 1994, 1999 and 2013. The bond market was up +6.9% YTD (total return) through the close of trading on Thursday 8/13/20. The Bloomberg Barclays Aggregate bond index, calculated using 6,000 publicly traded government and corporate bonds with an average maturity of 5 years, was used as the bond measurement (source: Bloomberg).

4. UNDER THE PILLOW – Since the beginning of 2020, the size of the money market fund industry in the USA (both taxable and tax-free) has grown from $3.6 trillion to $4.6 trillion as of Wednesday 8/12/20 (source: Investment Company Institute).

5. YOU DON’T HAVE TO – The 3/27/20 CARES Act allows (but does not require) American seniors to skip the “required minimum distribution” (RMD) taken from their retirement accounts in 2020. RMDs began the year in which you reached age 70 ½ if you hit 70 ½ in 2019 or earlier, or they begin in the year that you reach age 72. The change to age 72 as the starting point for distributions was included in the SECURE Act that was signed into law on 12/20/19. Please consult a tax professional for details (source: CARES Act).

6. NEED A LOT OF MONEY – The US government forecasted on Monday 8/03/20 that it will borrow $4.5 trillion during fiscal year 2020, i.e., the 12 months ending 9/30/20. That total exceeds the $3.8 trillion borrowed over the previous 4 fiscal years of 2016-2019 (source: Treasury Department).

7. THE WORLD’S BIGGEST – The size of the US economy was $19.4 trillion as of 6/30/20, down $2.3 trillion from $21.7 trillion recorded as of 12/31/19. 10 years ago (6/30/10), the size of the US economy was $14.9 trillion. 20 years ago (6/30/00), the size of the US economy was $10.2 trillion. 30 years ago (6/30/90), the size of the US economy was $6.0 trillion (source: Bureau of Economic Analysis).

8. THERE’S BAD, THEN THERE’S AWFUL – The US economy fell 10.0% in size between 3/31/20 and 6/30/20. The United Kingdom’s economy fell 20.4% in size between 3/31/20 and 6/30/20 (source: Office for National Statistics).

9. WILL THE PANDEMIC CHANGE THIS? – The US fertility rate, i.e., the number of children that are projected to be born to a woman in her lifetime, has declined in 10 of the last 11 years since 2007. The rate was 2.12 children in 2007, falling to 1.73 children in 2018, the latest year that the data has been calculated (source: World Bank).

10. CALM BEFORE THE STORM? – Banks repossessed 230,305 homes in calendar year 2018. Banks repossessed 143,955 homes in calendar year 2019. Through 7/31/20, banks had repossessed just 40,080 homes YTD (source: Attom Data Solutions).

11. ONLY HALF? – In order to approve a vaccine, the Food and Drug Administration requires that the vaccine must be at least 50% effective, i.e., the “yet to be approved” COVID-19 vaccine must prevent half the people who receive the vaccine from becoming infected with the COVID-19 virus (source: Food and Drug Administration).

12. SOME WILL, SOME WON’T – 49% of 1,056 American adults surveyed in mid-May 2020 plan on getting the COVID-19 vaccine as soon as it becomes available. 51% either will not get the vaccine immediately or are not sure what they will do (source: National Opinion Research Center at the University of Chicago).

13. MOST SUSCEPTIBLE – As of 8/08/20, 58% of American COVID-19 deaths occurred to individuals at least age 75, while just 1% of the victims were under the age of 35 (source: HealthData.gov).

14. NOWHERE TO GO – There are 57 cruise ships either sitting at or anchored near US coastal cities waiting for the Center for Disease Control to lift the suspension of their industry. Many of the ships remain anchored at sea in order to avoid “port fees” that can exceed $10,000 a day (source: US Coast Guard).

15. MATH MAJORS – The Big 10 Conference has 14 teams whereas the Big 12 Conference has 10 teams while the Pac-12 Conference has 12 teams (source: BTN Research).

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