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Bill’s By The Number$

Posted by: Kim Vo | Posted on: March 13th, 2017 | 0 Comments

1. EIGHT YEARS OF GAINS – The ongoing bull market for the S&P 500 reached 8 years in length as of the close of trading on Thursday 3/09/17. Over the 8 years, the index has gained +314.4% (total return), an average annual return of +19.4%. 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. NO BIG DAILY DROP – As of the close of trading last Friday (3/10/17), the S&P 500 has gone 103 consecutive trading days without suffering at least a 1% decline over any single trading day. That’s the longest stretch the stock index has gone without a 1% drop since it had a run of 105 trading days without a 1% tumble that ended on 12/15/95 or more than 21 years ago (source: BTN Research).

3. DON’T WORRY ABOUT IT – Legislation signed into law by President Barack Obama on 11/02/15 (i.e., more than 16 months ago) suspended any debt ceiling limit until 3/15/17, i.e., Wednesday of this week. Our national debt was $18.5 trillion on 11/02/15. Our national debt was $19.9 trillion last week (source: Treasury Department).

4. AND BORROW WE DO – The yield on the 10-year Treasury note closed at 2.58% on Friday 3/10/17. The yield on the 10-year Treasury note closed at 4.59% on 3/10/07. Thus for the same annual cost of money, our government can borrow +78% more money today than we did 10 years ago (source: BTN Research).

5. DISCRETIONARY VS. MANDATORY – Over the next decade (fiscal years 2018-2027), estimated discretionary spending by the US government will total $13 trillion, an amount that is dwarfed by the government’s $34 trillion of projected mandatory spending (source: Office of Management and Budget).

6. A LOT IN A FEW – Less than 2% of the banks and savings institutions in the United States hold 82% of the deposits maintained in FDIC-insured institutions nationwide as of 12/31/16. There are a total of 5,913 banks and savings institutions holding $16.8 trillion of deposits as of the end of last year (source: FDIC).

7. US AND THEM – China has a target of +6.5% for economic growth during calendar year 2017. The United States has achieved year-over-year growth of at least +6.5% just once in the last 50 years, i.e., growth of +7.3% during calendar year 1984 (source: National People’s Congress).

8. GAP IN COVERAGE – House Republicans released the “American Health Care Act” (AHCA) last Monday (3/06/17), their replacement of the March 2010 Affordable Care Act. The bill includes language that allows health insurers to impose a +30% price increase on individuals who go uninsured for at least 63 days and then buy coverage only after they become sick, a provision known as “continuous coverage” (source: AHCA).

9. BIG CHANGE – The AHCA would change the funding of Medicaid as of 1/01/2020 from the current open-ended federal matching structure to a single block grant provided to the states by Uncle Sam (source: AHCA).

10. TAKES BOTH COMPONENTS – GDP growth of +3% per year, a goal of the Trump White House, could be achieved with +2% productivity growth (output per hour per worker) combined with +1% labor force growth (source: Department of Labor).

11. DEFENSE – The Budget Control Act of 2011 (signed on 8/02/11) set a cap of $549 billion for fiscal year 2018 defense spending, a total that President Trump wants to boost to $603 billion. The annual spending cap does not include “war spending” which is exempt from the 2011 legislation (source: Congressional Research Service).

12. LAND OF LINCOLN – Illinois, a state considering an income tax increase, has $12 billion of unpaid bills owed to vendors that provide services to the state (source: State of Illinois Comptroller).

13. PAPER OR PLASTIC? – Total credit card debt in the United States dropped in January 2017 to $995 billion, the first month-over-month decrease since February 2016. The peak in credit card debt nationally was $1.022 trillion in April 2008 (source: Federal Reserve).

14. IT WAS NO BIG DEAL – Today (3/13/17) is the 1,400th trading day since S&P downgraded the USA from a top credit rating on Friday 8/05/11. The yield on the 10-year Treasury note closed at 2.57% on 8/05/11. The yield on the 10-year Treasury note closed last Friday (3/10/17) at 2.58% (source: BTN Research).

15. FASTEST EVER – University of Washington wide receiver John Ross ran an electronically timed 4.22 seconds for the 40-yard dash at the 2017 NFL Combine, the fastest ever run. The NFL Combine has used electronic timing since 2000 (source: CBS Sports).

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