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Bill’s By The Number$

Posted by: Vanessa Guadiana | Posted on: March 30th, 2015 | 0 Comments

  1. BELOW – With just 2 trading days remaining in the 1st quarter 2015, the S&P 500 has gained +0.6% YTD (total return).  The average quarterly gain for the index in the last 25 years (i.e., 1990-2014) has been +2.3%.  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. RESULT OF A STRONG DOLLAR – American multinational firms lost $27 billion when they converted their 2014 foreign sales (transacted in non-dollar currencies) back into US dollars (source: FIREapps).    
  3. FEW STOCKS, LARGE IMPACT – The 5 largest stocks in the S&P 500 made up 11% of the total stock market capitalization of the index as of 2/28/15.  Thus, 1% of the stocks in the index (i.e., 5 out of 500) represented 11% of the total value of the index.  The S&P 500 is a market-cap weighted index (source: S&P).   
  4. WHEN I’M 64 – 21% of 7,000 Americans surveyed anticipate that they will work until they die, i.e., they will never retire.  Another 53% of Americans expect that after retiring from their main career they will obtain new sources of income during their retirement years, e.g., part-time work at a new job.  Only 26% of Americans believe that they will no longer work in any capacity during their retirement years (source: Pew Charitable Trusts).   
  5. BUYING MASSIVE AMOUNTS OF BONDS – Securities that are held outright held by the Federal Reserve as of 3/25/15 were worth $4.228 trillion.  With an average interest rate of 2.358% on the USA’s interest bearing debt (as of 2/28/15) the Fed will receive $100 billion a year in interest payments, i.e., $8.3 billion a month.  The Fed wants to keep reinvesting the interest payments it receives at least until after it begins raising short-term interest rates (source: Federal Reserve).  
  6. APRIL ROCKS – The S&P 500 has averaged a gain of +1.74% (total return) during the month of April over the last 25 years (i.e., 1990-2014), ranking April as the 2nd best performing month during that period.  The month of December, up +1.96% on average is the top performing month.  The month of August, down 0.70% on average has been the worst performing month (source: BTN Research).  
  7. LARGER LEVELS OF DEBT – The ratio of household debt (i.e., home mortgages, auto loans, credit card debt, student loans) to personal income was 31% in 1952, 81% in 2000, peaked at 120% in 2008, but has fallen back to 96% today (source: Federal Reserve Bank of St. Louis).     
  8. HIGH SCHOOL – 88% of Americans at least age 25 have graduated from high school as of 2013.  Only 24% of Americans at least age 25 had graduated from high school as of 1940 (source: Census Bureau).        
  9. BORROW TO LEARN – 40 million Americans (i.e., 12.5% of our population of 321 million) have student debt totaling $1.16 trillion, an average of $29,000 each (source: Federal Reserve Bank of New York).  
  10. FEWER HOMES ON THE MARKET – The number of existing homes for sales in the USA has fallen 46% in the last 5 years.  There were 3.531 million homes for sale as of 2/28/10, reducing to 1.890 million as of 2/28/15 (source: National Association of Realtors).  
  11. MUCH EARLIER START – Ted Cruz announced his candidacy for the Presidency of the United States on 3/23/15, more than 19 months before the November 2016 election, the first candidate from either political party to do so.  John F. Kennedy announced his candidacy for the Presidency of the United States on 1/02/60, just 10 months before the November 1960 election that he won (source: BTN Research).  
  12. WATER WOES – 93% of California is experiencing at least a “severe drought” (note that the continuum of droughts is defined as a range from “severe” to “extreme” to “exceptional”).  14% of the United States is experiencing at least a “severe drought” (source: U.S. Drought Monitor).  
  13. DIVERSIFIED OR NOT – 78% of the overall tax revenue collected by the state of Alaska is tied back to the oil and gas industry.  Just 9% of the overall tax revenue collected by the state of Texas is related to oil and gas (source: Federal Reserve Bank of Dallas).  
  14. WHAT A MESS – More than 3 of every 5 Americans surveyed (61%) believe that the US tax code is so flawed that a complete overhaul of the system is needed today (source: Pew Research Center).  
  15. RICH DUDE – Los Angeles Dodger pitcher Clayton Kershaw’s 2015 salary is $32.571 million.  Kershaw faced 749 batters in 27 starts last year.  If Kershaw faces 749 batters this year and averages 4 pitches per batter (his average was 3.63 pitches per batter in 2014), then his 2015 salary equates to $10,871 per pitch (source: MLB).


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