Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: January 10th, 2022 | 0 Comments

WASHINGTON AND WALL STREET – Democrat Joe Biden began his second calendar year as POTUS # 46 last week. Democrats also maintain their control of Congress with a voting majority in the House and Senate. Over the last 60 years (1962-2021), the S&P 500 has gained +11.9% per year (total return) when one party controls the White House, the Senate and the House. 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).

AFTER THAT – The S&P 500 was up +11.0% (total return) for the 4th quarter 2021, the 19th time in the last 30 years (1992-2021) that the index has had at least a +10% gain (total return) in a quarter. Following the previous 18 quarters when the index was up double-digits, the next quarter was up 17 of 18 times (source: BTN Research).

WORTH MANY TRILLIONS – The US stock market grew by $12 trillion in calendar year 2021, from $41 trillion as of 12/31/2020 to $53 trillion as of 12/31/2021. 10 years ago (12/31/2011), the US stock market was worth just $16 trillion (source: Siblis Research).

A SINGLE STOCK – The largest capitalized individual stock in the US reached $3 trillion on 1/03/2022. 40 years ago (1982), the total market capitalization of all stocks in the world was $2.7 trillion (source: Wordbank.org).

PROTECTING THE DOWNSIDE – There were more put option contracts outstanding (more than 200 million) at the end of 2021 on US individual stocks, ETFs (exchange-traded funds) and stock indices than at any time in history based on records maintained since 2009 (source: CBOE Global Markets).

ONE RIGHT, ONE WRONG – Savita Subramanian, Head of US Equity and Quantitative Strategy at Bank of America, predicted on 12/21/20 that the S&P 500 would end calendar year 2021 at 3800 and that the yield on the 10-year Treasury note would finish the year at 1.50%. As of 12/31/2021, the S&P 500 closed at 4766 and the closing yield on the 10-year note was 1.496% (source: Barron’s).

NOT DOING A LOT – The current session of Congress (the 117th, running from 1/03/2021 to 1/03/2023), has passed only 81 bills with a year to go. The fewest number of bills passed in any 2-year session of Congress going back to 1973 is 284 during the 112th session of Congress that ran from 2011-2012 (source: GovTrack.us).

DEBT – The United States increased its national debt by $9.64 trillion in the last 5 years, i.e., 2017-21, rising from $19.977 trillion (12/31/2016) to $29.617 trillion (12/31/2021) (source: Treasury Department).

DOWN FROM A TOP – 5,079 retail stores closed nationwide in 2021, down from an all-time record 12,200 store closures in 2020 (source: CoStar Group).

PAY NOTHING – 32% of the 148.2 million tax returns that were filed for tax year 2019 (the latest year for which data has been released) did not pay any federal income tax, a total of 46.7 million tax returns (source: IRS).

DUE IN APRIL – Tesla founder Elon Musk claims that as a result of exercising stock options in 2021 that were awarded to him in 2012, he will pay over $11 billion in federal income tax when he files his 2021 individual income tax return, the largest federal income tax bill for any individual in US history. Musk received 26.4 million non-qualified stock options in 2012, allowing him to buy his company’s stock at $6.24 a share at any time before August 2022. Musk is the richest person in the world, worth $263 billion as of 1/07/2022 (source: CNBC).

NECESSARY SKILLS – Utah has the top financial literacy requirement for its high school students of any of the 50 US states. Utah requires all of its high school students to take a half-year course dedicated to personal finance, and then to take a final exam administered by the state. Ohio is the latest US state to add some form of financial literacy instruction at the high school level, effective 1/27/2022 (source: Champlain College Inc.).

MAYBE, MAYBE NOT – 37 states do not tax Social Security benefits, while the other 13 states may or may not tax Social Security benefits dependent on other facts, e.g., an individual’s total income (source: USA Today).

HAS NEVER BEEN LOWER – 5 states (Georgia, Nebraska, Oklahoma, Utah and West Virginia) recorded their lowest unemployment rates ever in November 2021. State jobless rates have been tracked nationwide since 1976 (source: Bureau of Labor Statistics).

WHO WINS? – It’s Alabama vs. Georgia in college football’s national championship game tonight (1/10/2022). An Alabama victory would give Nick Saban his 8th national title as a head coach. His 7 current titles (6 with Alabama and 1 with LSU) is the most in college football history (source: NCAA).