Bill’s By The Number$

Posted by: Vanessa Guadiana | Posted on: March 28th, 2016 | 0 Comments

1. BELOW – With just 4 trading days remaining in the 1st quarter 2016, the S&P 500 has gained +0.1% YTD (total return).  The average 1st quarter gain for the index in the last 25 years (i.e., 1991-2015) has been +2.1%.  The S&P 500 consists of 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.  SIX WEEKS – In the last 29 trading days since bottoming on Thursday 2/11/16, the S&P 500 has gained +11.6% (total return) through last Thursday 3/24/16 (the stock market was closed on Friday 3/25/16), a result that exceeds the index’s trailing 50-year (1966-2015) average annual return of +9.7% (source: BTN Research).
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 2/29/16.  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. APRIL ROCKS – The S&P 500 has averaged a gain of +1.88% (total return) during the month of April over the last 25 years (i.e., 1991-2015), ranking April as the best performing month during that period.  The month of October (up +1.85% on average) is the # 2 performing month.  The month of August (down 0.57% on average) has been the worst performing month (source: BTN Research).
5. NEEDED HELP – In the last 10 years (2006-2015), 518 banks have failed in the USA and have required a bailout from the Federal Deposit Insurance Corporation.  Over the same decade, just 17 life insurance companies have failed and were taken over by a state insurance department (source: FDIC, NOLHGA).
6. STUDENT DEBT – 43 million Americans have some level of student debt from attending college (source: Federal Reserve Bank of New York).
7. THE COST OF BUSINESS – The breakeven oil price for Saudi Arabian oil producers is $7 a barrel.  The breakeven oil price for Russian oil producers is $46 a barrel (source: Deutsche Bank).
8. LOSING THE SAFETY NET – Beginning on Friday 4/01/16, the first of at least 500,000 Americans (to as many as 1 million Americans) will be dropped from the “Supplemental Nutrition Assistance Program” (SNAP) aka “food stamps.”  A 3-month limit on “food stamp” benefits that has been waived since 2008 was reinstated at the beginning of 2016 in 22 states (source: Center on Budget and Policy Priorities).
9. IMPLICATIONS FOR INTEREST RATES? – When the Fed raised short-term interest rates in mid-December 2015, the committee’s post-meeting statement laid out a road map that included 4 rates hikes per year (of ¼ of 1% each) amounting to a total rate increase of +3 percentage points over the next 3 years.  Now just 3 months into that schedule, the Fed announced on Wednesday 3/16/16 that due to a sluggish global economy, they will cut in half the number of expected rate hikes in 2016 from 4 to 2 (source: Federal Reserve).
10. FEWER HOMES ON THE MARKET – The number of existing homes for sales in the USA has fallen 47% in the last 6 years.  There were 3.531 million homes for sale as of 2/28/10, reducing to 1.880 million as of 2/29/16 (source: National Association of Realtors).
11. WHAT, ME WORRY? – In spite of the S&P 500 falling 6.5% (total return) during last December and this January, 84% of retired American investors surveyed in the first week of February 2016 left their stock portfolios unchanged during the 2-month market drop (source: WF/Gallup Investor and Retirement Optimism Index survey).
12. TOO MUCH VODKA – The life expectancy of American males at birth is 76.4 years.  The life expectancy of Russian males at birth is 64.0 years (source: Center for Disease Control, American Enterprise Institute).
13. RAIN DANCE – 73% 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”) as of 3/22/16, down from 93% a year ago.  5% of the United States is experiencing at least a “severe drought” as of 3/22/16, down from 14% a year ago (source: U.S. Drought Monitor).
14. IN vs. OUT – In 2015, US imports from China were 4 times as large as US exports to China.  In 2015, US imports from Japan were 2 times as large as US exports to Japan (source: Department of Commerce).
15. SELECT GROUP – 25 ballplayers will make the opening day rosters of 30 major league baseball teams later this week, a total of 750 big league ballplayers.  Coming into the 2016 pro baseball season, 18,663 men have appeared in at least 1 game at the major league level (source: Major League Baseball).

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