Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: May 27th, 2022 | 0 Comments

DOG DAYS OF SUMMER – The summer months of June-July-August are ranked 9th, 5th and 11th in terms of S&P 500 performance over the last 30 years, i.e., 1992-2021. 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).

LAST YEAR – Going into the 2022 Memorial Day holiday, the S&P 500 is down 12.2% YTD (total return). Going into Memorial Day 2021, the S&P 500 was up +12.6% YTD (total return) (source: BTN Research).

STOCKS AND RATE HIKES – Between 6/30/2004 and 6/29/2006, the Fed raised interest rates 17 times. Each rate hike was 0.25 percentage points, a total increase of 4.25 percentage points. That took the Fed’s target short-term rate from 1.00% to 5.25%. From the close of trading on 6/30/2004 to the close of trading on 6/29/2006, the S&P 500 gained +15.7% (total return) over the 2-years, or +7.6% per year (source: BTN Research).

WORK FROM HOME, START A BUSINESS – Americans filed 4.35 million “new business” applications in 2020 and 5.36 million in 2021, surpassing the previous US record high of 3.50 million filed in 2019. Before 2017, “new business” applications in the US had not exceeded 3 million in a single year (source: Census Bureau).

ARE WE SHRINKING? – Demographers use 2.1 “births per woman” as the number of births required to achieve “replacement fertility,” i.e., the number of births needed for a population to exactly replace itself from one generation to the next. Over the 50 years from 1970 to 2020, the “births per woman” for the United States has declined from 2.5 to 1.6 (source: The World Bank).

ONE THOUSAND FEWER EACH DAY – The United States had 3.658 million births in 2021, or 10,022 births per day. 20 years earlier (2001), the United States had 4.026 million births, or 11,030 births per day (source: Centers for Disease Control and Prevention).

DIFFERENT PAYMENTS – For every $1,000 paid by Medicare for hospital inpatient and outpatient services, including costs incurred for medical facilities and services provided by healthcare professionals, an employer-sponsored health insurance plan would pay $2,240 or more than twice as much (source: RAND Corporation).

KEEPING UP WITH INFLATION – Over the last 25 calendar years, i.e., 1997-2021, “cost of living adjustments” (COLA) for Social Security benefits have increased +73.7%. Over the last 25 calendar years, i.e., 1997-2021, inflation as measured by the “consumer price index” (CPI), has increased +75.8% (source: Social Security, Department of Labor).

CAN’T LAST FOREVER – The size of the US economy as of 3/31/2022 was $24.4 trillion. The size of the US national debt as of 3/31/2022 was $30.4 trillion (source: Commerce Department).

HOW DID YOU DO? – The net worth of Americans increased +62% over the last 5 years (+10.1% per year), rising from $92.8 trillion as of 12/31/2016 to $150.3 trillion as of 12/31/2021 (source: Federal Reserve).

JOLLY GOOD – The unemployment rate in the United Kingdom, i.e., England, Scotland, Wales and Northern Ireland, dropped to 3.7% as of 3/31/2022, the island nation’s lowest jobless rate since 1974 or 48 years ago (source: Office of National Statistics).

BLAME IT ON THE WAR – Moody’s Investors Services utilizes a credit rating scale that includes 21 different ratings from its top rating (Aaa) to its lowest rating (C). The top 10 ratings are deemed to be “investment grade” while the lower 11 ratings are “non-investment grade.” Moody’s lowered the credit rating on the debt obligations of Ukraine to “Caa3” on 5/20/2022, the 3rd lowest rating (out of 21 ratings) issued by the firm (source: Moody’s).

BUMMED – “Consumer sentiment” of the American consumer, an indicator of how optimistic consumers feel about their finances, fell in May 2022 to its lowest level since August 2011. “Consumer sentiment” has been tracked monthly since January 1978, i.e., for the last 533 months, and has been lower than the May 2022 level during just 10 months in the last 44 ½ years, i.e., 10 months out of 533 months (source: Univ. of Michigan).

NOT NOW – Less than 1 in 5 Americans (19%) surveyed in April 2022 believe it’s a “good time” to buy a home in today’s market (source: Fannie Mae).

SOCCER – 3 of the top 4 highest paid athletes in any sport in the world today play soccer, topped by Argentine superstar Lionel Messi who earned an estimated $130 million (both on and off the field) for the year ending 5/01/2022. Only 2 women were ranked in the top 50 sports earners globally (source: Forbes).