Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: August 24th, 2020 | 0 Comments

1. A WILD WALL STREET RIDE – The S&P 500 was down 30.4% YTD (total return) as of 3/23/20, but 106 trading days later the index is up +6.5% YTD (total return) as of last Friday 8/21/20. 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 proportionate to its market value (source: S&P Dow Jones Indices).

2. JUST A SELECT FEW – The NASDAQ Composite is up +26.9% YTD (total return) through the close of trading last Friday 8/21/20. Just 5 stocks drive approximately 40% of the return of the cap-weighted index. The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system (source: NASDAQ).

3. GETTING IT ALL BACK – There have been 6 bear markets in which the S&P 500 has suffered at least a 30% decline in the last 75 years (1945-2020), the latest being a 34% tumble ending 3/23/20. In each case, the stock market eventually recovered 100% of the loss sustained, i.e., it closed above the previous bull market high. The average time the S&P 500 took to recover back to a new record price after the first 5 bears was 43 months, compared to just a 5 month bounce back needed after the 3/23/20 bear market low (source: BTN Research).

4. BAD COMPANY – As of the summer 2019, there were just 4 “advanced economies” in the world with a government “debt-to-GDP” ratio higher than the United States – Japan, Greece, Italy and Portugal. “Advanced economies” are defined as developed, industrialized and mature economies (source: International Monetary Fund).

5. OUR NUMBER – As of 6/30/20, the US government’s “debt-to-GDP” ratio was 137%, i.e., $26.5 trillion of government debt divided by our $19.4 trillion economy (source: Treasury Department).

6. WHEN DEMAND DROPS – The world production of crude oil was 101 million barrels a day in 2019. The pandemic caused a global collapse in oil consumption, forcing the major oil players of OPEC and Russia to implement an output cut of 9.7 million barrels a day in April 2020. The drop in demand forced US oil producers to cut output by 2.4 million barrels a day since mid-March 2020 (source: US Energy Information Administration).

7. IT WILL TAKE TIME – Economists from the 2nd largest bank in the United States predict that the US economy will not recover to its pre-pandemic level until early 2023 (source: Bank of America).

8. FIND A NEW JOB – An estimated 33% of the pandemic-driven layoffs in the United States that occurred from March 2020 through May 2020 will be permanent, i.e., the workers will never return to their old jobs at their former employers (source: Brookings Papers on Economic Activity).

9. ONE HUNDRED – As of 9am ET on 8/21/20, 175,422 Americans had died from the COVID-19 virus. 100 days earlier as of 9am ET on 5/13/20, 83,557 Americans had died from the COVID-19 virus. Thus, 91,865 Americans have died in the last 100 days from the pandemic (source: NBC News, Meet the Press: First Read).

10. MOVING TO THE SUBURBS – The New York metropolitan area had a net loss of 6,786 households during the 2nd quarter 2020, while Los Angeles had a net loss of 6,347 households (source: RealPage).

11. PAYING LESS – Just 5% of US homeowners had implemented a forbearance plan with their lender as of the end of June 2020 allowing them to pause or reduce their monthly mortgage payments for a limited period of time, i.e., 4.2 million out of 86.0 million homeowners (source: Mortgage Bankers Association).

12. NO OTHER CHOICE – New Jersey Governor Phil Murphy signed into law on 7/16/20 an emergency bond act that authorizes the state to borrow $9.9 billion through 6/30/2021, money needed to offset the fiscal impact of the pandemic. The general obligations bonds, agreed to without voter approval, would take New Jersey’s outstanding bond debt from $44.4 billion to $54.3 billion (source: New Jersey Department of Treasury).

13. GATHERED EVERY MONTH – The calculation of our nation’s “consumer price index” is based upon pricing data collected each month from 22,000 retail stores (e.g., department stores, groceries stores, gas stations, and restaurants) across 75 urban areas nationwide (source: Bureau of Labor Statistics).

14. GO BIG RED – Famous stock investor Warren Buffett turns 90 years old next Sunday on 8/30/20. Buffett, a 1951 graduate of the University of Nebraska, is worth $69 billion. Buffett has accumulated 84% of his net worth since he turned 65 years old, i.e., in the last 25 years (source: Fortune).

15. BUCS AND BRADY? – Super Bowl # 55 is scheduled to be held on 2/07/21 in Tampa, FL, the 5th time the city of Tampa has hosted the championship game. No NFL team in history has ever played in the Super Bowl on their home field (source: NFL).

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