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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: February 22nd, 2021 | 0 Comments

  1. BULL RUN - In the nearly 11 months since bottoming on 3/23/20, the S&P 500 has gained +77.4% (total return) through last Friday 2/19/21. The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation.  It is a market (source: BTN Research).
  1. LUCKY – A person with $1 million invested 100% in the S&P 500 as of 1/01/73 withdrawing an inflation-adjusted $100,000 per year would be out of money in 9 years, i.e., as of 12/31/81. A 2nd person with $1 million invested in the S&P 500 as of 1/01/82 withdrawing an inflation-adjusted $100,000 per year would have $6.32 million remaining after 39 years, i.e., as of 12/31/20.  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).
  1. BAD DAY, BAD YEAR - The worst year for the taxable bond market in the last 30 years (1991-2020) was a loss of 2.92% (total return) in 1994. The stock market, using the S&P 500 as a measurement, has had 105 trading days in the last 30 years that resulted in a loss of at least 2.92% (total return).  The Bloomberg Barclays US Aggregate Bond Index (created in 1986 with backdated history calculated to 1976), calculated using publicly traded investment grade government bonds, corporate bonds and mortgage-related bonds with at least 1 year until final maturity, was used as the bond measurement (source: Bloomberg Barclays).
  1. MORE OUT THAN IN - The 4 largest monthly budget deficits in US history occurred in 2020. The 4 months were June 2020 ($864 billion deficit), April 2020 ($738 billion deficit), May 2020 ($399 billion deficit) and February 2020 ($235 billion deficit).  The last month to run a surplus was in September 2019 (source: Treasury Department).
  1. START RIGHT AWAY - A child born in February 1999 (22 years ago) who started college in the fall of 2017 is scheduled to graduate from an average 4-year public in-state college in May 2021. If the child’s parents had invested $146 per month beginning at the child’s 1999 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 $86,320).  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).
  1. TOP SHELF - To rank in the top 0.1% of US taxpayers in tax year 2018, i.e., the top 1 out of 1,000 taxpayers, required an adjusted gross income of $2,514,209 (source: Internal Revenue Service).
  1. PEOPLE - The US population reached 200 million in 1967, 300 million in 2006 (39 years later) and was projected in February 2020 to reach 400 million in 2058. Our population today is 330 million (source: Census Bureau).
  1. NEW HOMES - The construction of 991,100 new single-family homes began in 2020, the 9th consecutive year of increasing home building in the US. In the decade of the 2010s, 6.8 million new homes began construction, down 44% from the 12.3 million new homes that started in the decade of the 2000s (source: Census Bureau).
  1. BY STATE - There are 27 Republican governors and 23 Democratic governors. The longest tenured governor nationwide is Andrew Cuomo (D-NY) who just began his 11th year in office (source: Ballotpedia.org).
  1. BY AGE - 81% of US pandemic deaths as of 2/19/21 were Americans at least age 65. 1% of US pandemic deaths as of 2/19/21 were Americans under age 35 (source: Centers for Disease Control and Prevention).
  1. BY MONTH - 195,000 Americans died in October 1918 during the worldwide flu outbreak, the deadliest month in our nation’s history. 95,000 Americans died from COVID-19 in January 2021, the worst month to date for pandemic-related deaths nationwide (source: Center for Disease Control).
  1. OUTLAYS - US consumer spending dropped 3% during calendar year 2020, a combination of spending on “goods” increasing +6% while spending on “services” fell 7% (source: Federal Reserve Bank of New York).
  1. PUSHING THE LOCALS ASIDE - The “home buying budget” today in Austin, TX for home buyers from outside of the state of Texas is +32% higher than the “home buying budget” of local buyers (source: Redfin).
  1. PAY FOR IT LATER - Student loan debt in the United States was 90% larger than credit card debt nationwide as of 12/31/20, i.e., $1.56 trillion to $820 billion (source: Federal Reserve Bank of New York).
  1. GOLF - Tiger Woods has earned $121 million in career earnings from playing golf on the PGA tour, but has earned $1.5 billion in his career from endorsements, appearances and course design work (source: Forbes).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: February 15th, 2021 | 0 Comments

  1. STOCK MARKET - The median annual return of the stock market over the last 45 years (1976-2020) was a gain of +15.8% (total return). The stock market has produced a positive total return gain in 37 of the last 45 years, i.e., 82% of the time.  The S&P 500, consisting of 500 stocks chosen for market size, liquidity and industry group representation, was used as the stock measurement.  It is a market value weighted index with each stock's weight in the index proportionate to its market value (source: BTN Research).
  1. BOND MARKET - The median annual return of the taxable bond market over the last 45 years (1976-2020) was a gain of +6.5% (total return). The taxable bond market has produced a positive total return gain in 42 of the last 45 years, i.e., 93% of the time.  The Bloomberg Barclays US Aggregate Bond Index (created in 1986), calculated using publicly traded investment grade government bonds, corporate bonds and mortgage-related bonds with at least 1 year until final maturity, was used as the bond measurement (source: Bloomberg Barclays).
  1. DO THE MATH - The S&P 500 is up +4.9% YTD (total return) through last Friday 2/12/21. Since the S&P 500 is a cap-weighted index, the largest capitalized stocks carry a disproportionate impact on the index’s performance calculation.  As of 2/12/21, the 8 largest stocks in the index (out of 505 individual stocks counted in the index) represent 25% of the total capitalization of the index (source: Slickcharts.com).
  1. SUPPLY AND DEMAND - The price of West Texas Intermediate (WTI) crude oil had fallen to $22.76 a barrel as of 4/09/20 as the global impact of COVID-19 was crushing the worldwide demand for oil. As of last Friday 2/12/21, WTI crude oil closed at $59.47 a barrel, its highest closing price since 1/09/20 (source: NYMEX).
  1. MORE IN THAN OUT - For every $1 of goods that US companies exported to Chinese buyers in 2020, American consumers imported $3.49 of goods from Chinese manufacturers (source: Department of Commerce).
  1. IT’S AN INDEX - Inflation, as measured by the “Consumer Price Index” (CPI), was up +1.4% for 2020. The category “food” within the CPI calculation was up +3.9% for the year, “medical care services” was up +2.8%, but “energy” was down 7.0% last year (source: Department of Labor).
  1. WILL YOU NEED TO WORK? - Even though 1 of 4 current retirees (27%) have held a job for pay during their retirement years, just under 3 of 4 current workers (74%) anticipate they will hold a job for pay during their upcoming retirement years (source: Employee Benefit Research Institute 2020 Retirement Confidence Survey).
  1. LET’S SHOOT FOR MORE - A 65-year old American male has a life expectancy of 18.2 years. A 65-year old American female has a life expectancy of 20.8 years (source: National Center for Health Statistics).
  1. HOME EQUITY - Single-family home values in the United States have increased by an average of +10.0% YTD through 11/30/20, likely to result in the first “double-digit” average return for home values nationwide for an entire calendar year since 2004. Data on the change in home values during December 2020 will be released on 2/23/21 (source: Federal Housing Finance Agency).
  1. DREAM HOME - Ground was broken in the United States on the construction of 100,200 single-family homes in October 2020, the largest monthly total nationwide since June 2007 (source: Census Bureau).
  1. HOW WE LIVE - Of the 7.2 million new US households created in the last 4 years, 100% were “owner” households while none were “renter” households, i.e., “owner” households grew from 75.6 million (12/31/16) to 82.8 million (12/31/20), while “renter” households remained flat at 43.0 million (source: Census Bureau).
  1. WE’RE DOWN, THEY’RE DOWN A LOT - The US economy fell 3.5% in size during calendar year 2020. The collective economies of the 19 countries that use the Euro as their common currency, i.e., the Eurozone, fell 6.8% in size during calendar year 2020 (source: Department of Commerce, Eurostat).
  1. BLUE CONTROL - The House of Representatives is currently made up of 221 Democrats, 211 Republicans and 3 vacancies. 2 of the 3 vacancies are in Louisiana, and a 3rd is from Texas (source: House of Representatives).
  1. ALL DONE WITH MY WORK - An average American worker has increased his/her productivity by +50% in the last 21 years, i.e., an average worker can complete in 2 hours as of 12/31/2020 the same amount of work that it took him/her 3 hours to finish as of 12/31/1999 (source: Department of Labor).
  1. NICE JOB SCOUTING - 6 college quarterbacks were selected before Tom Brady in the 1999 NFL draft. 3 of the 6 never played in an NFL playoff game.  The other 3 played in a grand total of 11 playoff games.  Tom Brady has played in 45 playoff games, including 10 Super Bowls (source: Pro Football Reference).
- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: February 8th, 2021 | 0 Comments

  1. TEN YEARS - Since 1950, there have been 62 different 10-year periods (i.e., the 10-years from 1950-59, 1951-60, . . ., 2011-2020). The S&P 500 produced a positive total return in 60 of the 62 decade-long periods.  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).
  1. ONE STOCK, ONE MONTH - The top performing individual stock in the S&P 500 index during January 2021 was up +49% for the month (source: S&P).
  1. NOTHING - 76% of 619 millennials surveyed in the 4th quarter 2019 do not believe Social Security will exist when they retire. Millennials were born between 1981-97 and are ages 24-40 in 2021 (source: Transamerica).
  1. HISTORIC NEED FOR MONEY - The Treasury Department is expected to auction this week $126 billion of 3-year notes ($58 billion), 10-year notes ($41 billion) and 30-year bonds ($27 billion), an all-time quarterly debt auction record amount (source: Treasury Department).
  1. JOBS - The Congressional Budget Office forecasted on 2/01/21 that the number of employed Americans (150.0 million as of 1/31/21) will not recover to its pre-pandemic level of 158.7 million until 2024 (source: CBO).
  1. WILL CONGRESS AGREE? - The $1.9 trillion COVID-relief plan as outlined by the Biden administration includes $350 billion in aid to state and local governments, $400 billion for pandemic vaccination, testing, tracing and for the reopening of schools, $600 billion in direct aid to families (the $1,400 per person stimulus payments), $400 billion in jobless benefits, and $150 billion in “Paycheck Protection Program” (PPP) loans/grants for small businesses (source: The Brookings Institution).
  1. IT HAS BEEN DONE BEFORE - Congressional Democrats are using “budget reconciliation” to move President Joe Biden’s $1.9 trillion COVID-relief plan through the Senate. “Reconciliation bills” are not subject to the “filibuster rule” that ends debate on a piece of legislation only after 60 senators agree to do so, i.e., it would take just 51 senators (instead of 60) to approve the COVID-relief bill.  Congress has used the “budget reconciliation” process to enact 21 bills in the last 40 years (source: Center on Budget and Policy Priorities).
  1. NEGOTIATING WITH THE BANK - As of the end of October 2020, just 3.0 million homeowners with mortgages were in a forbearance plan with their lender, representing 5.6% of all homeowners with mortgages and only 3.6% of all homeowners (source: Black Knight Mortgage Monitor).
  1. THOUGHT IT WOULD BE HIGHER - 522,808 Americans filed bankruptcy in 2020, down 30% from 752,160 bankruptcy filings in 2019 (source: United States Courts, Table F-2, Bankruptcy Filings).
  1. WERE YOU IN ON THIS? - 5.6 million existing homes were sold in 2020, the highest number recorded in the United States since 2006 (source: National Association of Realtors).
  1. GREATER THAN INFLATION - Wages and salaries in the private sector increased +2.8% during calendar year 2020. Wages and salaries in the public sector (i.e., local and state government workers) increased +1.8% during calendar year 2020.  Inflation, as measured by the “Consumer Price Index” (CPI), was up +1.4% for 2020.   (source: Department of Labor).
  1. JUST ONE OF FIFTY STATES IMPROVED - The unemployment rate in 49 of 50 US states increased between December 2019 and December 2020. Hawaii had the greatest jobless rate jump (up 6.6 percentage points from 2.7% to 9.3%).  South Dakota was the only state to report a lower jobless rate last year, dropping from 3.4% to 3.0% (source: Bureau of Labor Statistics).
  1. HUNT FOR HIGHER YIELD - The average current yield on “CCC” rated corporate bonds (as rated by S&P) was 7.6% in January 2021, within 0.3 percentage points of the lowest average yield ever recorded for this “junk bond” rated category, i.e., an all-time low of 7.3% was set in 2014. The current yield of bonds drops as investors bid up the price of the bonds (source: Ice Data Services).
  1. GENTLEMAN FARMER - Bill Gates is the largest private owner of farmland in the United States with 242,000 acres. His largest holdings are in Louisiana, Arkansas and Nebraska (source: The Land Report).
  1. SPRING (AND SNOW) IS IN THE AIR - Training camps for major league baseball teams open this month. The minimum salary for a major league baseball player for 2021 is $570,500.  To rank in the top 1% of all US taxpayers (based upon 2018 tax data) required an adjusted gross income level of at least $540,009 (source: MLB).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: February 1st, 2021 | 0 Comments

  1. ONE MONTH - The S&P 500 lost 1.01% (total return) in January 2021. Exactly one-third (33%) of the months over the last 30 years (the 360 months from 2/1991 through 1/2021) have produced a negative return.  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).
  1. INDEX MATH - The S&P 500 closed at an all-time high on Monday 1/25/21, finishing the day at 3855. Just 13 individual stocks in the index also closed at an all-time high on Monday 1/25/21 (source: BTN Research).
  1. END OF LIFE - 2,839,000 Americans died in 2018. 2,855,000 Americans died in 2019.  An estimated 3,271,000 Americans died in 2020 (source: Center for Disease Control).
  1. IN A UNION - 35% of workers in the public sector (i.e., local, state or federal government) were union members in 2020. 6% of workers in the private sector were union workers in 2020 (source: Bureau of Labor Statistics).
  1. PLANNING AHEAD - 6 out of every 7 full-time workers surveyed (86%) in October 2020 are investing money for their retirement, mostly through an employer-sponsored pre-tax plan. 2,069 workers participated in the survey (source: Transamerica Center for Retirement Studies).
  1. RELIEF DOLLARS - 36% of stimulus payment money received by Americans from the March 2020 CARES Act was put into savings, while 35% was used to pay down debt (source: Federal Reserve Bank of New York).
  1. THEY VOTE THIS YEAR - Presidents of 4 of the 12 regional Federal Reserve Banks began their 1-year rotation as voting members of the Federal Open Market Committee (FOMC) last Tuesday 1/26/21. The 4 new voting members in 2021 are Charles Evans (Chicago), Mary Daly (San Francisco), Raphael Bostic (Atlanta) and Thomas Barkin (Richmond).  The New York Fed President (currently John Williams) is a permanent member of the FOMC (source: Federal Reserve).
  1. SELLERS’ MARKET - There were 1.07 million existing homes for sale nationwide as of 12/31/20. Two years ago (12/31/18), there were 1.53 million existing homes for sale nationwide.  Ten years ago (12/31/10), there were 3.02 million existing homes for sale nationwide (source: National Association of Realtors).
  1. AS LONG AS RATES STAY LOW - The average interest rate that the US government pays on its interest-bearing debt as of 12/31/20 was 1.695%, down from 2.331% as of 12/31/15. That means our government can borrow 37.5% more money today than it borrowed 5 years ago and still have the same out-of-pocket interest expense cost (source: Treasury Department).
  1. COMING BACK? - The number of operating oil rigs in the United States both on land and offshore have increased for 10 consecutive weeks through last Friday 1/29/21. The current total of 384 operating oil rigs nationwide is 57% higher than the low point of 244 from 8/14/20.  The pandemic forced 60 North American oilfield service companies into bankruptcy (source: Baker Hughes, Haynes and Boone).
  1. GLOBAL TRADE REBOUNDS - After declining for 10 months during the 2020 pandemic, the monetary value of goods shipped worldwide in November 2020 exceeded its previous high-water mark achieved in December 2019 (source: Netherlands Bureau for Economic Policy Analysis).
  1. READY TO LEAVE? - New York residents are currently subject to a top state marginal tax rate of 8.82% at taxable income levels of $1.08 million for an individual return and $2.16 million for a joint return. NY Governor Andrew Cuomo has proposed raising that top marginal rate to 10.86% for the 2022 fiscal year beginning 4/01/21.  NYC residents are also subject to a maximum city marginal tax rate of 3.876%, i.e., their total marginal rate could be as high as 14.736% during fiscal year 2022, the highest in the nation (source: IncomeTaxPro.net).
  1. GETTING ACCURATE INFORMATION - Over the 15 years from 2005 to 2020, 2,100 American newspapers went out of business (source: University of North Carolina Hussman School of Journalism and Media).
  1. IT’S FREE - 17 US states offer free community college education, including Arkansas, California, Maryland, Oregon and New York. All 17 states do enforce different eligibility requirements to qualify for the free tuition, e.g., community service, or a minimum high school GPA (source: The College Post).
  1. BROKE?! - Evander Kane of the NHL’s San Jose Sharks is in the 3rd year of a 7-year contract that will pay him $7 million a year. However Kane filed for Chapter 7 bankruptcy protection on 1/09/21, listing in the bankruptcy filing $10 million of assets offset by $27 million of liabilities (source: San Jose Mercury News).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: January 25th, 2021 | 0 Comments

  1. FIRST QUARTER - Over the last 30 years (1991-2020), the S&P 500 has gained an average of +1.65% (total return) during the 1st quarter (January-February-March), a total that represents just 15% of the index’s 30-year average return of +10.70% per year. 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).
  1. IS IT A BUBBLE? - The US stock market was worth $42.6 trillion as of the close of trading on 1/22/21, 2.0 times the size of our $21.2 trillion economy. At the peak of the dot-com stock bubble in March 2000, the US stock market was worth 1.4 times the size of the US economy (source: Fund Manager Julien Bittel).
  1. RED AND BLUE PROBLEM - The national debt increased +86% during George W. Bush’s 8 years as president, reaching $10.63 trillion as of 1/20/09. The national debt increased +88% during Barack Obama’s 8 years as president, reaching $19.95 trillion as of 1/20/17.  And finally, the national debt increased +39% during Donald Trump’s 4 years in the White House, reaching $27.75 trillion as of 1/20/21 (source: Treasury Department).
  1. LAST FOUR YEARS - From 1/20/17 to 1/20/21, i.e., Donald Trump’s 4 years as President, the S&P 500 gained +83.3% (total return), an average of +16.4% per year. The S&P 500 set 151 record closing highs during the Trump administration, including one on President Trump’s last day as POTUS (source: BTN Research).
  1. TIME FLIES - When Joe Biden was sworn in as a US Senator from the state of Delaware on 1/05/1973, he was the 5th youngest senator (age 30) in US history. When Joe Biden was sworn in as POTUS # 46 on 1/20/2021, he was the oldest president (age 78) to be inaugurated in US history (source: Politico.com).
  1. NOT DONE YET - In 2008-2009, the Congress authorized spending of $983 billion to alleviate the impact of the global mortgage crisis, an amount equal to 6% of the size of the US economy. In 2020, the Congress authorized spending of $3.7 trillion to alleviate the impact of the global pandemic, an amount equal to 17% of the size of the US economy (source: BTN Research).
  1. DID WE SHRINK DURING 2020? - The 1st of 3 estimates (spaced a month apart) of GDP growth/shrinkage for all of calendar year 2020 will be released on Thursday 1/28/21. Our nation’s GDP grew by +3.2% annually during the 1970s, by +3.1% annually during the 1980s, by +3.2% annually during the 1990s, by +1.9% annually during the 2000s, and finally by +2.3% annually during the 2010s (source: Department of Commerce).
  1. PERKS OF THE JOB - All former living US presidents (Carter, Clinton, Bush, Obama, Trump) receive a pension, an annual income of $221,400 (before-tax) in 2021. Former presidents also receive lifetime Secret Service protection (source: Former Presidents Act).
  1. NOW WHAT DO I DO? - 82% of 2020 college graduates did not have a full-time job in place on the day they graduated last year (source: TotalJobs Group Ltd.).
  1. GOING MY WAY? - The 3 most popular states to move into during 2020 were Tennessee, Texas and Florida. The 3 states with the greatest outflow of people during 2020 were California, Illinois and New Jersey.  The rankings are based upon more than 2 million rentals of moving trucks last year that involved a “1-way” interstate movement of furnishings, personal possessions and clothing (source: U-Haul Migration Trends 2020).
  1. I OWE ABSOLUTELY NOTHING! - 37% of US homeowners do not have any outstanding debt on their primary residence, including no mortgage debt or any debt associated with a home equity loan (source: American Community Survey).
  1. HOW CHEAP? - At the beginning of 2020, the all-time record low average interest rate nationwide for a 30-year fixed rate mortgage was 3.31% set on 11/22/12. A new record low average rate was established during 16 separate weeks in 2020, the last taking place on 12/24/20 at 2.66% (source: Freddie Mac).
  1. ELBOW ROOM - First class and business class airline tickets generate 30% of the revenue of an average US airline that flies internationally (source: International Air Transport Association).
  1. BIG CITIES, BIG FOOTPRINT - Just 25 cities in the United States create 52% of our nation’s GDP, including New York City (8.8% of the USA’s GDP), Los Angeles (5.4%) and Chicago (3.5%) (source: Statista).
  1. TIME TO WORK ON THAT HANDICAP - Former President Donald Trump owns 19 golf courses, including 12 in the United States and 7 overseas (source: The U.S. Sun).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: January 18th, 2021 | 0 Comments

  1. INVEST FOR THREE YEARS - Since 1926, 84% of the rolling 3-year periods for the S&P 500 index (i.e., the 93 separate 3-years beginning 1926-28, then 1927-29, . . . 2018-20) have produced a positive return. 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).
  1. YEAR ONE IN THE WHITE HOUSE - This year (2021) is the 1st year of Joe Biden’s 1st 4-year presidential term. The S&P 500 has been positive on a total return basis during just 13 of the last 23 “presidential 1st-years,” i.e., 1st-years dating back to 1929, but has been up 8 of the last 9 “1st years.”  The average performance for the S&P 500 during the last 23 “presidential 1st-years” has been a gain of +7.7% (total return) (source: BTN Research).
  1. THE INDEX TO FOLLOW - The S&P 500 stock index, worth $33.4 trillion as of 12/31/20, represents 81% of the $41.2 trillion market capitalization of all US stocks (source: S&P).
  1. REALLY LOW - Inflation, as measured by the “Consumer Price Index” (CPI), was up +1.4% for 2020. For the decade of the 2010s (1/01/2010 through 12/31/2019), inflation was up just +1.8% per year, the lowest decade of inflation in the USA since the 1930s.  By comparison, the decade of the 1970s (1/01/1970 through 12/31/1979) suffered +7.4% annual inflation (source: Department of Labor).
  1. THEY OWN IT NOW - Banks foreclosed on 50,238 homes nationwide in 2020, down 65% from 143,955 foreclosures in 2019 and down 78% from 230,305 foreclosures in 2018. The worst single year of foreclosures in US history – 1,050,500 foreclosures in calendar year 2010 (source: ATTOM Data Solutions).
  1. TOP TEN AND EVERYONE ELSE - The top 10% of US taxpayers in tax year 2018 made at least $152,000 in adjusted gross income (AGI), received 48% of all AGI nationwide and paid 71% of all federal income tax (FIT) collected for the 2018 tax year. The bottom 90% of US taxpayers in tax year 2018 made less than $152,000 in AGI, received 52% of all AGI nationwide and paid 29% of all FIT collected for the 2018 tax year (source: IRS).
  1. WHAT TYPES OF TAXES? - 35% of the total tax revenue taken in by state and local governments are property taxes, a total that is more than the combined tax revenue collected in the form of state income taxes (20%) and corporate income taxes (3%) (source: Tax Foundation).
  1. SOMETHING FOR SENIORS - President-elect Biden outlined on the 2020 campaign trail a proposal that would provide an additional boost in Social Security benefits for those seniors that have been receiving retirement benefits for at least 20 years (source: CNBC).
  1. LOAN OR A GRANT - The 3rd iteration of the “Paycheck Protection Program” (PPP) began last Monday 1/11/21. The first 2 PPP programs loaned out $522 billion while PPP # 3 will lend out as much as $284 billion to first-time business borrowers and to some small businesses as repeat-borrowers (source: Paycheck Protection Program).
  1. PRINT AND PURCHASE - The Fed’s balance sheet reached $6.8 trillion as of 1/13/21, up from $3.9 trillion as of 3/11/20, the result of additional purchases of Treasuries (up +$2.2 trillion in 10 months) and mortgage-backed securities (up +$668 billion in 10 months) (source: Federal Reserve).
  1. FOUR YEARS, EIGHT TRILLION - On 1/20/17, the day Donald Trump was inaugurated as POTUS 45, the national debt was $19.9 trillion. As of 1/14/21, the national debt was $27.7 trillion (source: Treasury Department).
  1. DEATHS - The USA had 2,855,000 deaths nationwide in calendar year 2019, i.e., pre-pandemic, an average of 238,000 per month. From 2/06/20 to 1/06/21, i.e., the 11 months beginning with the first COVID-19 death in the USA, 358,000 Americans died as a result of the pandemic, an average of 32,500 per month (source: CDC).
  1. ESTATE TAXES - The maximum amount that a deceased individual may pass onto his/her heirs federally estate-tax free (with proper planning) rises to $11.7 million in 2021, up from $11.58 million in 2020. The limit was $675,000 in 2001 or 20 years ago.  Please consult a tax expert for details (source: Internal Revenue Service).
  1. DIFFERENCE OF OPINION - Rock superstar Prince died on 4/21/16, leaving an estate that was valued (for estate tax purposes) at $82 million. The IRS has challenged the valuation techniques utilized by his administrator, upping the estate value at Prince’s death to $163 million.  The IRS is asking for an additional $39 million in estate taxes and penalties above what Prince’s estate has already paid (source: IRS).
  1. THEY’RE NOT ALABAMA - Only 3 FBS schools (Football Bowl Subdivision) out of 130 opted out of the entire 2020 college football season – Connecticut, New Mexico State and Old Dominion (source: NCAA).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: January 11th, 2021 | 0 Comments

  1. WASHINGTON AND WALL STREET – Democrat Joe Biden will be sworn in as President # 46 on 1/20/21, and Democrats have control of Congress by achieving a voting majority in both the House and the Senate. Over the last 60 years (1961-2020), the S&P 500 has gained +11.8% 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).
  1. FIFTY-FIFTY - The political split in the Senate today is technically not 50-50, but rather is 50 Republicans, 48 Democrats and 2 Independents who caucus with the Democrats, effectively making it a 50-50 split. The last time the Senate was split 50-50 was in 2001, George W. Bush’s first year in office (source: Senate).
  1. UP/DOWN - The S&P 500 has been up 40 of the last 50 years, i.e., 1971-2020, gaining an average of +10.9% per year (total return). The index had an average annual gain of +18.4% (total return) during the 40 “up years” while losing an average of 14.8% per year (total return) during the 10 “down years” (source: BTN Research).
  1. OUR PART OF THE WORLD - The US stock market had a total capitalization of $41 trillion as of 12/31/20, 39% of the world’s $104 trillion stock market capitalization (source: S&P).
  1. WHERE DOES THIS MONEY COME FROM? - The Fed is buying $120 billion of bonds each month - $80 billion of Treasury debt and $40 billion of mortgage-backed securities. The Fed confirmed on 12/16/20 that the purchases will continue “until substantial further progress has been made toward the Committee’s maximum employment and price stability goals” (source: Federal Reserve).
  1. DEBT - The USA increased its national debt by $7.77 trillion in the last 4 years, i.e., 2017-20. The USA increased its national debt by $7.67 trillion in the previous 7 years, i.e., 2010-16 (source: Treasury Department).
  1. ONE IDEA - President-elect Biden proposed during his campaign a $15,000 tax credit for “first-time” home buyers, available to home buyers who have not owned a residence within the previous 3 years. The tax credit would be “refundable” (if you didn’t use the full amount of the credit, the unused balance is refunded to you) and “advanceable” (you are allowed to claim the credit immediately as opposed to waiting until you file your Form 1040 for the tax year in which you purchased a home).  Biden described the tax credit as a form of “down-payment assistance” (source: Biden 2020 Presidential Campaign).
  1. NINE ZEROS - The number of billionaires in the United States has increased +9% since mid-March 2020 to 659 (source: Institute for Policy Studies).
  1. GOT A LOWER RATE - Through 9/30/20, 65% of the mortgages that were originated in the United States YTD were refis of existing mortgages (source: Inside Mortgage Finance).
  1. YOU THINK IT’S THIS EASY EVERY YEAR? - More new brokerage accounts (an estimated 10 million) were opened during calendar year 2020 than in any other year in US history (source: JMP Securities).
  1. MARGIN DEBT - The use of margin debt on the New York Stock Exchange (NYSE) has increased to $722 billion in November 2020, an all-time record total. The previous record high was $669 billion set in May 2018 (source: Financial Industry Regulatory Authority).
  1. OLD AND THE YOUNG - 81% of COVID-19 deaths nationwide as of 12/30/20 were Americans at least age 65. Just 1% of COVID-19 deaths nationwide as of 12/30/20 were Americans under the age of 35 (source: National Center for Health Statistics).
  1. IN MY PAJAMAS, BUT STILL WORKING - 67% of 451 information technology (IT) executives in the United States that were polled in June 2020 anticipate that their firm’s “work-from-home” (WFH) policies would be permanent or at the very least “long-term” in duration (source: 451 Research).
  1. THE WORK-WORLD HAS CHANGED FOREVER - 80% of 1,388 American workers surveyed in June and July 2020 say they would prefer to work at least 3 days a week from home after the pandemic is brought under control (source: Global Workplace Analytics).
  1. WHO WINS? - Alabama faces off vs. Ohio State in college football’s national championship game tonight (1/11/21). An Alabama victory would give Nick Saban his 7th national title as a head coach (6 with Alabama and 1 with LSU), breaking the record of 6 coaching titles that he currently shares with Bear Bryant (source: NCAA).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: January 4th, 2021 | 0 Comments

  1. FOR THE YEAR – The S&P 500 gained +18.4% (total return) during 2020, the 13th year in the last 25 years that the $33.4 trillion index has returned at least +15% (total return) for the calendar year. 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).
  1. LONG-TERM - The S&P 500 has gained an average of +10.9% per year (total return) over the last 50 years (i.e., 1971-2020). The index has been positive in 16 of the last 18 years.  Over the long-term, the S&P 500 has been up during 40 of the last 50 years, i.e., 80% of the time (source: BTN Research).
  1. HIGH-FLYERS - The NASDAQ Composite gained +44.9% (total return) in 2020 and has gained +98.1% (total return) over the last 2 years (2019-2020), its best 2-year run since 1998-1999. The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system (source: BTN Research).
  1. BOND INDEX - The taxable bond market was up +7.5% in 2020 (total return) and has gained +7.6% per year (total return) over the last 40 years (1981-2020). The Bloomberg Barclays US Aggregate Bond Index (created in 1986), calculated using publicly traded investment grade government bonds, corporate bonds and mortgage-related bonds with at least 1 year until final maturity, was used as the bond measurement.  The index is a major benchmark for US bond investors (source: Bloomberg Barclays).
  1. MOST OF THE TIME - The +7.5% total return for Bloomberg Barclays US Aggregate Bond Index in 2020 follows its +8.7% gain in 2019, the best “back-to-back” years for the index since 2001-2002. The widely followed bond index, created in 1986 with backdated history calculated to 1976, has produced a negative total return for the calendar year in just 3 years of the last 40 years, i.e., in 1994, 1999 and 2013 (source: Bloomberg Barclays).
  1. TIME IN THE MARKET - Since 1950 (i.e., 1950-2020), the S&P 500 index has been up 54% of 17,866 trading days, 60% of 852 months, 67% of 284 quarters and 73% of 71 years (source: BTN Research).
  1. MISSING THE BEST - The total return for the S&P 500 over the last 30 years (1991-2020) was a gain of +10.7% per year (total return). If you missed the 24 best percentage gain days over the last 30 years (i.e., 24 days in total, not 24 days per year), the +10.7% annual gain falls in half to a +5.3% annual gain (source: BTN Research).
  1. AVOID THE WORST - The total return for the S&P 500 over the last 30 years (1991-2020) was a gain of +10.7% per year (total return). If you avoided the 24 worst percentage days over the last 30 years (i.e., 24 days in total, not 24 days per year), the +10.7% annual gain rises to a +17.1% annual gain (source: BTN Research).
  1. JOBLESS - The lowest (3.5%) and the highest (14.7%) unemployment rates in the United States in the last 50 years (since 1970) both occurred in 2020, and they took place just 2 months apart (source: Department of Labor).
  1. BIRTHS, DEATHS AND IMMIGRATION - Between 7/01/19 and 7/01/20, the Census Bureau estimated that the US population grew by just +0.35%, i.e., approximately one-third of 1% growth rate between 2019-2020. That’s the lowest year-over-year growth rate in the USA based upon records maintained since 1900 or 120 years of data (source: Census Bureau).
  1. LIVING LONG - The life expectancy at birth of an American baby in 1971, i.e., 50 years ago, was 71.1 years. The life expectancy at birth of an American baby today is 78.7 years.  Thus, life expectancy in the United States has increased 7.6 years over the last half century, i.e., American life expectancy at birth is increasing at the rate of 1 ½ years every decade (source: Center for Disease Control).
  1. TEN-YEAR TREASURY NOTE - The yield on the 10-year Treasury note ended 2020 at 0.91%, its lowest calendar year close ever and down 1 percentage point from its 12/31/19 close of 1.91%. The 10-year Treasury note yield was 0.50% on Monday 3/09/20, its lowest closing yield ever.  10-year notes have been traded in the USA since 1790, i.e., 230 years of trading (source: Treasury Department).
  1. HOUSING - The average interest rate nationwide on a 30-year fixed rate mortgage was 2.76% at the end of 2020. The all-time record low national average is 2.66%, set just 1 week earlier on 12/24/20 (source: Freddie Mac).
  1. OIL PRICES - The price of oil ended 2020 at $48.52 a barrel, down 20.5% from its 2019 close of $61.06 a barrel. Oil’s all-time closing high price is $147.27 a barrel as of 7/11/08 (source: CME Group).
  1. OVERSPENDING - The national debt of the United States was $27.56 trillion as of the close of business on Wednesday 12/30/20, an increase of $4.36 trillion during calendar year 2020 (source: Treasury Department).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2021 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: December 21st, 2020 | 0 Comments

  1. ALL THE OTHER STUFF - Administrative costs make up 34% of total US health care expenditures (i.e., expenses not related to direct patient care) including medical billing, the scheduling of appointments, and hiring of an office staff (source: Annals of Internal Medicine). # 11, 1/13/20.
  1. ADVANTAGE: SELLERS - The number of existing single-family homes for sale has been tracked nationally since July 1982, i.e., for nearly 4 decades. The total peaked in July 2007 at 3.4 million but has now fallen to its all-time low of 1.22 million in December 2019 (source: National Association of Realtors).  # 7, 1/27/20.
  1. MILLIONS DIED - The most lethal health epidemic in the last 500 years was the worldwide flu outbreak that occurred in the fall of 1918 that killed 50 million people globally, including 675,000 Americans. 195,000 Americans died in October 1918, the deadliest month in our nation’s history (source: CDC).  # 14, 2/24/20.
  1. THE SICKEST AMONG US - Just 1% of the US population is responsible for 22% of total health care spending in the country, i.e., 1% of our 329 million population (3.3 million people) create $800 billion of health care expenses or an average of $242,000 per person per year (source: Brookings). # 9, 3/16/20.
  1. NO JOB - First-time jobless claims for the week ending 2/01/20 were 201,000, its lowest level since 11/15/69. Just 7 weeks later, jobless claims for the week ending 3/21/20 were 3.283 million, a US record (source: Department of Labor).  # 8, 3/30/20.
  1. YOUR LIFE - If you were born in 1987 and you turn age 33 in 2020, you have lived through 5 bear markets and 3 recessions, the 1987 “Black Monday” stock market crash, the 9/11 terrorist attacks, the 2008 global real estate crisis, and now the 2020 pandemic. You have also lived through 4 bull markets (including the 11-year bull that ended on 2/19/20), 4 economic expansions and you have benefited from the lowest interest rates in history.  Your life expectancy as of today: 47.3 additional years on earth (source: BTN Research).  # 3, 4/13/20.
  1. RAINING NOW - All 50 US states maintain a “rainy day” fund that may be accessed as a result of an economic emergency. As of 7/01/19, California had $19.2 billion set aside, Texas had $7.8 billion, New York had $2.5 billion while Illinois had just $4 million (source: National Association of State Budget Officers).  # 5, 4/20/20.
  1. JUST HERE FOR THE DAY - 48% of hospital revenue in 2018 came from outpatient procedures (source: Deloitte Center for Health Solutions). # 9, 5/11/20.
  1. ALL FOR EXACTLY THE SAME SERVICES - Private US health insurance pays on average $241 for health care services for every $100 that Medicare pays and for every $72 that Medicaid pays (source: RAND, Health Affairs). # 12, 5/25/20.
  1. OUT OF THIN AIR - From the end of 2008 to the end of 2010, the Fed “digitally created” $1.4 trillion of new money that was used to purchase Treasury bonds as part of its “Quantitative Easing” program. From Thursday 3/12/20 through Friday 6/12/20, the Fed “digitally created” $2.9 trillion of new money that was used to purchase Treasury bonds and corporate bonds (source: Federal Reserve).  # 5, 6/22/20.
  1. PRINTING TOO MUCH? - Some, but not all economists, feared that our “digital creation” of money in 2008-14 and again in 2020 could lead to hyperinflation, something that occurred in Germany in 1921-23, in Argentina in 1975-1990, and in Zimbabwe in 2007-09 (source: BTN Research). # 13, 6/29/20.
  1. YOU WANT A DISCOUNT? - The schools with the 4 largest college endowments in the United States – Harvard, University of Texas, Yale and Stanford – increased the cost of tuition for their undergraduates for the 2020-21 school year (source: MarketWatch). # 12, 9/14/20.
  1. BAYOU MISERY - 4 of the 10 tropical storms or hurricanes that made landfall in the USA in 2020 – Cristobal, Laura, Marco and Delta – made landfall in Louisiana. The 10 tropical storms or hurricanes to make US landfall broke the record of 9 set in 1916 or 104 years earlier (source: Insurance Information Institute).  # 14, 10/19/20.
  1. WE VOTED! - An estimated 159.8 million Americans voted in the 2020 presidential race, representing 66.8% of the 239.2 million “voting-eligible” Americans. The 159.8 million voters are an all-time US record and the 66.8% is the highest “percentage turnout” in 120 years (source: NBC News).  # 3, 11/09/20.
  1. ONE-PERCENTERS - To rank in the top 1% of US taxpayers for the 2018 tax year required adjusted gross income (AGI) of at least $540,009. That highly paid group received 21% of all AGI reported nationwide but they also paid 40% of the federal income tax that was collected (source: Internal Revenue Service).  # 6, 12/14/20.

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2020 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: December 14th, 2020 | 0 Comments

  1. ELECTION YEAR – The S&P 500 was up +15.4% YTD (total return) through Friday 12/11/20. Assuming the index finishes up for the year, the S&P 500 will have recorded a positive total return in 18 of the last 20 presidential election years.  The only “down election years” dating back to 1944 were in 2000 and 2008. 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).
  1. ALL WERE TOO LOW - A year ago (12/16/19), Barron’s published the year-end 2020 forecast for the S&P 500 made by 10 Wall Street strategists. The 10 predictions ranged from a low of 3000 to a high of 3500.  The index’s 12/31/19 actual close was 3231.  The S&P 500 closed last Friday 12/11/20 at 3663 (source: Barron’s).
  1. ALL WERE TOO HIGH - A year ago (12/16/19), Barron’s published the year-end 2020 forecast for the yield on the 10-year Treasury note made by 10 Wall Street strategists. The 10 predictions ranged from a low of 1.50% to a high of 2.20%.  The 10-year note’s actual yield close on 12/31/19 was 1.91%.  The yield on the 10-year Treasury note closed last Friday 12/11/20 at 0.90% (source: Barron’s).
  1. LATE IN THE YEAR - After closing at an all-time high on Tuesday 12/08/20, the S&P 500 is assured of achieving its calendar year high during the month of December in 6 of the last 8 years (source: BTN Research).
  1. THE FED - 4 of the 6 current members of the Federal Reserve’s Board of Governors were appointed during President Trump’s 4-years in office – Richard Clarida, Randal Quarles, Michelle Bowman and Christopher Waller. There remains 1 vacancy on the 7-member Board of Governors (source: Federal Reserve).
  1. ONE-PERCENTERS - To rank in the top 1% of US taxpayers for the 2018 tax year required adjusted gross income (AGI) of at least $540,009. That highly paid group received 21% of all AGI reported nationwide but they also paid 40% of the federal income tax that was collected (source: Internal Revenue Service).
  1. FIVE-PERCENTERS - To rank in the top 5% of US taxpayers for the 2018 tax year required adjusted gross income (AGI) of at least $217,913. This group received 36% of all AGI reported nationwide but they paid 60% of the federal income tax that was collected (source: IRS).
  1. TAXES - The top 3% of US taxpayers in tax year 2018 reported at least $286,106 of adjusted gross income (AGI) but paid 53% of all federal income tax. The 97% of taxpayers who reported less than $286,106 of AGI paid the remaining 47% of federal income tax that was collected in tax year 2018 (source: IRS).
  1. TAKE THE OTHER GUY’S MONEY - 67% of 3,477 Americans surveyed in early November 2020 believe that federal income taxes should be raised for any taxpayer making $400,000 or more (source: SurveyMonkey.com).
  1. GET OUT THE VOTE - Voter turnout increased in the November 2020 election when compared to voter turnout from November 2016 in 98% of the nation’s 3,142 counties (source: National Election Pool).
  1. COVID-19 DEATHS - Approximately 40% of the American death toll from COVID-19 as of Sunday 12/06/20 are elderly patients in long-term care facilities across the country (source: Dr. Moncef Slaoui, Operation Warp Speed top scientist).
  1. HELP FOR COLLEGE STUDENTS - The Department of Education announced on Friday 12/04/20 a second extension through 1/31/21 of the forbearance period on federal student loans. The forbearance plan, i.e., a pause in required principal and interest payments, began on 3/13/20 and was to expire on 9/30/20, but was extended on 8/21/20 through the end of this year.  92% of all student loans (by dollar) are federal loans, with the remaining 8% being loans that were originated by a private lender (source: Department of Education).
  1. WORSE DURING A PANDEMIC - In the 6 months following the 9/11/01 terrorist attacks on the US, the commercial airline industry in the United States suffered losses of $10.3 billion (stated in 2020 dollars). In the first 6 months of calendar year 2020, i.e., 1/01/20 through 6/30/20, the commercial airline industry in the United States suffered losses of $14.9 billion (source: USA Facts).
  1. IT HAS BEEN AWHILE - Congress has passed 4 separate bills providing $2.8 trillion of pandemic relief, but the last of the 4 bills (HR 6312) was signed into law on 4/24/20 or nearly 8 months ago (source: Congress).
  1. SAFE TO PLAY - The total rounds of golf played by Americans is projected to increase by 50 million rounds in 2020, the largest year-over-year growth in 23 years. In 1997, spurred on by the appeal of a then 21-year old Tiger Woods, the number of rounds increased by 63 million rounds (source: National Golf Foundation).

- Broker/Dealer Use Only, Reproduction Prohibited without Express Permission - Copyright © 2020 Michael A. Higley.  All rights reserved.  Email mick.higley@mahbtn.com for subscription information.

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