Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: February 15th, 2021 | 0 Comments

STOCK MARKET – The median annual return of the stock market over the last 45 years (1976-2020) was a gain of +15.8% (total return). The stock market has produced a positive total return gain in 37 of the last 45 years, i.e., 82% of the time. The S&P 500, consisting of 500 stocks chosen for market size, liquidity and industry group representation, was used as the stock measurement. It is a market value weighted index with each stock’s weight in the index proportionate to its market value (source: BTN Research).

BOND MARKET – The median annual return of the taxable bond market over the last 45 years (1976-2020) was a gain of +6.5% (total return). The taxable bond market has produced a positive total return gain in 42 of the last 45 years, i.e., 93% of the time. The Bloomberg Barclays US Aggregate Bond Index (created in 1986), calculated using publicly traded investment grade government bonds, corporate bonds and mortgage-related bonds with at least 1 year until final maturity, was used as the bond measurement (source: Bloomberg Barclays).

DO THE MATH – The S&P 500 is up +4.9% YTD (total return) through last Friday 2/12/21. Since the S&P 500 is a cap-weighted index, the largest capitalized stocks carry a disproportionate impact on the index’s performance calculation. As of 2/12/21, the 8 largest stocks in the index (out of 505 individual stocks counted in the index) represent 25% of the total capitalization of the index (source: Slickcharts.com).

SUPPLY AND DEMAND – The price of West Texas Intermediate (WTI) crude oil had fallen to $22.76 a barrel as of 4/09/20 as the global impact of COVID-19 was crushing the worldwide demand for oil. As of last Friday 2/12/21, WTI crude oil closed at $59.47 a barrel, its highest closing price since 1/09/20 (source: NYMEX).

MORE IN THAN OUT – For every $1 of goods that US companies exported to Chinese buyers in 2020, American consumers imported $3.49 of goods from Chinese manufacturers (source: Department of Commerce).

IT’S AN INDEX – Inflation, as measured by the “Consumer Price Index” (CPI), was up +1.4% for 2020. The category “food” within the CPI calculation was up +3.9% for the year, “medical care services” was up +2.8%, but “energy” was down 7.0% last year (source: Department of Labor).

WILL YOU NEED TO WORK? – Even though 1 of 4 current retirees (27%) have held a job for pay during their retirement years, just under 3 of 4 current workers (74%) anticipate they will hold a job for pay during their upcoming retirement years (source: Employee Benefit Research Institute 2020 Retirement Confidence Survey).

LET’S SHOOT FOR MORE – A 65-year old American male has a life expectancy of 18.2 years. A 65-year old American female has a life expectancy of 20.8 years (source: National Center for Health Statistics).

HOME EQUITY – Single-family home values in the United States have increased by an average of +10.0% YTD through 11/30/20, likely to result in the first “double-digit” average return for home values nationwide for an entire calendar year since 2004. Data on the change in home values during December 2020 will be released on 2/23/21 (source: Federal Housing Finance Agency).

DREAM HOME – Ground was broken in the United States on the construction of 100,200 single-family homes in October 2020, the largest monthly total nationwide since June 2007 (source: Census Bureau).

HOW WE LIVE – Of the 7.2 million new US households created in the last 4 years, 100% were “owner” households while none were “renter” households, i.e., “owner” households grew from 75.6 million (12/31/16) to 82.8 million (12/31/20), while “renter” households remained flat at 43.0 million (source: Census Bureau).

WE’RE DOWN, THEY’RE DOWN A LOT – The US economy fell 3.5% in size during calendar year 2020. The collective economies of the 19 countries that use the Euro as their common currency, i.e., the Eurozone, fell 6.8% in size during calendar year 2020 (source: Department of Commerce, Eurostat).

BLUE CONTROL – The House of Representatives is currently made up of 221 Democrats, 211 Republicans and 3 vacancies. 2 of the 3 vacancies are in Louisiana, and a 3rd is from Texas (source: House of Representatives).

ALL DONE WITH MY WORK – An average American worker has increased his/her productivity by +50% in the last 21 years, i.e., an average worker can complete in 2 hours as of 12/31/2020 the same amount of work that it took him/her 3 hours to finish as of 12/31/1999 (source: Department of Labor).

NICE JOB SCOUTING – 6 college quarterbacks were selected before Tom Brady in the 1999 NFL draft. 3 of the 6 never played in an NFL playoff game. The other 3 played in a grand total of 11 playoff games. Tom Brady has played in 45 playoff games, including 10 Super Bowls (source: Pro Football Reference).