Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: February 18th, 2022 | 0 Comments

SOME TURN INTO BEARS – As of the close of trading on Friday 2/18/2022, the S&P 500 is down 9.3% from its all-time closing high set on Monday 1/03/2022. 6 of the index’s 26 tumbles of at least 10% that have occurred in the last 50 years were “bear” markets falling at least 20% from a previous closing high. 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).

ONE WAS JUST LUCKY – A person with $1 million invested 100% in the S&P 500 as of 1/01/1973 who was withdrawing an inflation-adjusted $100,000 per year would be out of money in just 9 years, i.e., as of 12/31/1981. The very next day, a 2nd person also with $1 million invested in the S&P 500 as of 1/01/1982 who is withdrawing an inflation-adjusted $100,000 per year would have $7.72 million remaining after 40 years, i.e., as of 12/31/2021. This calculation ignores the ultimate impact of taxes on the account which are due upon withdrawal, is for illustrative purposes only and is not intended to reflect any specific investment or performance. Actual results will fluctuate with market conditions and will vary (source: BTN Research).

START RIGHT AWAY – A child born in February 2000 (22 years ago) who started college in the fall of 2018 is scheduled to graduate from an average 4-year public in-state college in May 2022. If the child’s parents had invested $150 per month beginning at the child’s 2000 birth and had earned an annualized +8% on all invested dollars, the parents would have been able to pay for their child’s 4-year college expenses of tuition, fees, room and board (the 4-year cost was $88,330). This calculation ignores the ultimate impact of taxes on the investment account which are due upon withdrawal, is for illustrative purposes only and is not intended to reflect any specific investment or performance. Actual results will fluctuate with market conditions and will vary (source: College Board).

THE PRICE OF ELITE – The average 1-year cost of tuition, fees, room and board at a private 4-year American college for the 2021-2022 school year was $50,580 (source: College Board).

FEWER BABIES – The United States had 3.611 million births in 2020, a total that is projected to fall by 300,000 to 3.3 million when the final 2021 birth total is reported. US births were 3.96 million in 2011 (source: CDC).

THE BIGGEST – The 4 largest monthly budget deficits in US history occurred over a 12-month stretch beginning in April 2020. The 4 months were April 2020 ($738 billion deficit), May 2020 ($399 billion deficit), June 2020 ($864 billion deficit) and March 2021 ($660 billion) (source: Treasury Department).

PAY FOR IT LATER – Student loan debt in the United States was 84% larger than credit card debt nationwide as of 12/31/2021, i.e., $1.58 trillion to $860 billion (source: Federal Reserve Bank of New York).

A TAX THAT IMPACTS VERY FEW – 3,382,000 Americans died in 2020 or 9,240 a day. But of that 2020 death total, just 1,275 Americans paid federal estate taxes in 2020, down from 139,000 in 1976 (source: IRS).

SPENDING WHAT YOU DON’T HAVE – Americans added $1 trillion of household debt in 2021, increasing from $14.56 trillion as of 12/31/2020 to $15.58 trillion as of 12/31/2021 (source: Federal Reserve Bank of NY).

WE’RE STILL PRODUCTIVE – 58% of 10,737 workers surveyed worldwide during November 2021 are working part-time in an office environment and part-time at home, an increase of 12 percentage points from 46% who were functioning this way in May 2021 (source: Future Forum Pulse).

SIDE HUSTLE – 27% of American adults earn money from “gig activities,” e.g., childcare, house cleaning, ride sharing, selling goods online or renting property (source: Report on the Economic Well-Being of US Households).

MAKING MONEY – The breakeven price of crude oil that an American oil producer requires to be profitable on a new well is between $46 to $58 per barrel, depending on where the drilling occurs. The price of West Texas Intermediate crude oil closed at $91.07 a barrel on Friday 2/18/2022 (source: Federal Reserve Bank of Dallas).

NEW WHEELS – The average price of a new vehicle purchased in the United States in December 2021 was $45,743, an all-time record (source: J.D. Power).

WHEN’S THE NEXT? – The US has suffered through 11 recessions in the last 70 years. The last recession lasted only 2 months, the shortest in history, and ended in April 2020 (source: Nat’l Bureau of Econ. Research).

NO PLACE LIKE HOME – In the first 54 Super Bowls (1967-2020), no NFL team played and won the game on their home field. But in the last 2 Super Bowls (# 55 and # 56), the winning team (Tampa Bay in 2021 and the Los Angeles Rams in 2022) played and won the game on their home field (source: NFL).