Blog

Login


Contact Info

4400 MacArthur Blvd, Suite 850
Newport Beach, California 92660
888.277.1974

Contact Us


Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: May 10th, 2021 | 0 Comments

  1. STOCKS - The S&P 500 is up +13.3% YTD (total return) through trading on 5/07/21. The split between “up” and “down” trading days YTD is 56/44, better than the 54/46 split achieved over the years 1950-2020.  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. BE A CONTRARIAN - The last 7 times that the S&P 500 index recorded a negative total return result over a trailing 12-month period, the index bounced back each time with a positive gain of at least +15% (total return) over the next 12 months. The 1-year average return of all 7 comebacks is +27.6% (total return).  The most recent example was when the S&P 500 fell 7.0% (total return) for the 12 months ending 3/31/20 but bounced back with a +56.4% gain (total return) for the 12 months ending 3/31/21 (source: BTN Research).
  1. A YEAR LATER - As of 4/30/20, our nation’s jobless rate was 14.8% with 23.1 million Americans out-of-work. As of 4/30/21, our jobless rate was 6.1% with 9.8 million Americans out-of-work (source: Department of Labor).
  1. CONNECTED - From the end of 2020 through last Friday 5/07/21, the price of West Texas Intermediate crude oil has increased +34% (to $64.90 a barrel) while the average price of a gallon of gasoline has increased +31% (to $2.95 a gallon) (source: NYMEX, AAA).
  1. FRONT AND CENTER - Dr. Anthony Fauci has been the Director of the National Institute of Allergy and Infectious Diseases since 1984. Fauci, 80 years old, has served 7 Presidents – Reagan, Bush 41, Clinton, Bush 43, Obama, Trump and Biden (source: NIAID).
  1. LOWEST EVER - The nation’s “general fertility rate,” defined as the number of births per 1,000 women between the ages of 15-44, was just 55.8 births in 2020, a record low rate for birth data that has been tracked nationally since 1909 or for the last 112 years (source: National Center for Health Statistics).
  1. FEWER KIDS - The United States recorded 3,605,201 births in 2020, the 6th consecutive year the total has declined, and the smallest number recorded nationally since 1979 (source: National Vital Statistics System).
  1. NEW HOMES - 103,700 new single-family homes began construction in the United States in March 2021, the highest monthly total reported nationwide since June 2007 (source: Census Bureau).
  1. BUCKS FROM THE GOVERNMENT - Pandemic stimulus payments to individuals and federal unemployment benefits made up 22% of the record-setting US personal income total reported by the government for March 2021. The same 2 categories made up just 3% of national personal income in January 2020, i.e., immediately before the pandemic began (source: Bureau of Economic Analysis).
  1. TIME OFF WITH MONEY - One piece of the “American Families Plan” that President Biden proposed on 4/28/21 was a federally mandated “paid leave program” that would be phased in over a decade. At the end of 10 years, all US workers would be eligible for 12 weeks of paid leave (per year) under a variety of circumstances, including the birth of a child, the military deployment of a loved one, or recovery time needed following a serious illness.  The worker taking “paid leave” could receive as much as $4,000 per month (source: American Families Plan).
  1. BANKS - Through the first 4 months of 2021, no US bank had failed and required a financial bailout from the Federal Deposit Insurance Corporation (FDIC). There have been less than 10 banks that have failed in each of the last 6 calendar years, i.e., 2015-2020.  389 banks failed over the 3-year period 2009-2011 (source: FDIC).
  1. A MAJORITY STILL WENT TO COLLEGE - 66% of 2019 high school graduates (pre-pandemic) enrolled in college in the fall of 2019. 63% of 2020 high school graduates (after the pandemic started) enrolled in college in the fall of 2020 (source: Bureau of Labor Statistics).
  1. FEWER PEOPLE AND FEWER TAXPAYERS - Between the 2010 census and the 2020 census, the population of 47 states increased but declined in 3 states – West Virginia, Mississippi and Illinois (source: Census Bureau).
  1. THE LAST ELECTION - 155 million Americans voted in the November 2020 election that sent Joe Biden to the White House, 17 million more than the 138 million who voted in November 2016. The 155 million voters represent 67% of the nation’s citizens who are at least age 18 (source: Census Bureau).
  1. IT’S ALL ABOUT THE MONEY - The NFL signed sponsorship agreements with 3 gambling companies in April 2021 to operate retail and online gambling in those states that permit betting. Ironically, the NFL sued the state of New Jersey just 9 years ago (2012) to stop legal sports wagering on pro football in that state (source: NFL).

- 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.

Read More

Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: May 3rd, 2021 | 0 Comments

  1. FOUR MONTHS - The S&P 500 gained +5.3% (total return) in April 2021, putting the index up +11.8% YTD (total return) through Friday 4/30/21. 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. NEED A SCORECARD - The Biden White House announced last week its 3rd stimulus proposal since taking office on 1/20/21. The “American Families Plan” is a $1.8 trillion proposal (released on 4/28/21) that directs money to childcare, paid family leave and other domestic priorities.  Previously, the “American Rescue Plan Act,” aka HR # 1319, scored at $1.9 trillion and signed into law on 3/11/21 and the “American Jobs Plan,” the $2.3 trillion infrastructure proposal released on 3/31/21, was introduced by the administration (source: White House).
  1. TO START IN JULY - 90% of the estimated 50 million households in the United States that have children under the age of 18 qualify (based upon the household’s adjusted gross income) for the expanded Child Tax Credit (CTC) per the “American Rescue Plan Act.” Beginning 7/01/21, the CTC will pay $300 per month per child under age 6 and $250 per month per child between the ages 6-17.  Additional amounts may be available for full-time college students older than age 18.  Please consult a tax expert for details (source: Tax Policy Center).
  1. HIGHEST EVER - The top capital gains tax rate in 2021 for a married filing joint taxpayer with taxable income of at least $496,600 is 23.8%. On Thursday 4/22/21, reports surfaced that the White House favors increasing the top capital gains tax rate in 2022 for a married filing joint taxpayer with taxable income of at least $1 million to 43.4%.  The highest capital gains tax rate in US history is 39.875%, last levied in 1978 (source: IRS).
  1. READY FOR A VACATION - The average daily cost of a short-term vacation rental, i.e., for 3-7 days, for the summer of 2021 is +26% higher than the average daily cost from the summer of 2019 (source: AirDNA).
  1. WOOD - The average cost of building a new single-family home in the US has increased by +8% in the last year ($24,000) solely because of the rising cost of lumber. Lumber mills shut down nationwide in 2020 for as long as 4 months, leading to a lumber shortage as homebuilding demand accelerated.  Lumber imports into the USA have been impacted by a beetle plague ravaging Canadian forests (source: National Association of Homebuilders).
  1. DEMAND FOR EXISTING HOMES - The median price of a new single-family home built in the USA in March 2019 was +17% more expensive than the median price of an existing single-family home sold in March 2019. The median price of a new single-family home built in the USA in March 2021 was just +1% more expensive than the median price of an existing single-family home sold in March 2021 (source: Census Bureau).
  1. MAKE A QUICK DECISION - Existing homes that were sold nationwide in March 2021 were on the market on average of just 18 days (2 ½ weeks) before selling (source: National Association of Realtors).
  1. SIMPLER RETURN - The “Tax Cuts and Jobs Act” (TCJA) of December 2017 increased the standard deduction for taxpayers effective with the 2018 tax year. As a result of the change, the percentage of households taking the standard deduction has increased from 70% (pre-TCJA) to 90% (post-TCJA) (source: Tax Policy Center).
  1. TAX INCENTIVE - Just 45% of households in Germany are homeowners (compared to 66% in the USA). Interest paid on a home mortgage in Germany is not deductible on a personal tax return (unless the homeowner does not occupy the property), whereas mortgage interest expense is deductible for US homeowners who itemize their deductions (source: Deutsche Bundesbank).
  1. KEEP YOUR DISTANCE - As of March 2021, 4.2 million American workers have stepped away from the workforce because they are afraid of catching the COVID-19 virus at work (source: Department of Labor).
  1. IT’S NOT AN OPTION - Just 1 in 25 US corporations (4%) surveyed anticipate requiring its employees to be vaccinated for the COVID-19 virus (source: ManpowerGroup North America).
  1. LONE STAR - Texas gained 2 seats in the House of Representatives (to 38 seats) based upon the 2020 Census, on top of the 4 seats it gained (to 36 seats) following the 2010 Census (source: Census Bureau).
  1. HALF - 49% of the USA’s 330 million population maintain their health insurance through an employer’s health insurance plan either as an employee or a dependent of an employee (source: Kaiser Family Foundation).
  1. SOCIAL MEDIA - The PGA began on 1/01/21 a “Player Impact Program” that pays $40 million per year to the top 10 golfers based on “fan and sponsor engagement.” The top-rated golfer earns $8 million (source: PGA).

- 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.

Read More

Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: April 26th, 2021 | 0 Comments

  1. THEN WHAT? – The S&P 500 was up +6.2% (total return) in the 1Q 2021, the 42nd time the index has gained at least +6% in a calendar quarter since 1990, i.e., 42 out of 125 quarters (34%). The index has gained an average of +11.6% (total return) in the 12 months following a calendar quarter that was up at least +6%.  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. AFTER A BIG YEAR - The S&P 500 was up +56.4% (total return) for the 12 months ending 3/31/21, the 8th time the index has gained at least +40% over any 12-month period since 1990. The index has gained an average of +16.3% (total return) in the year following a 12-month period that was up at least +40% (source: BTN Research).
  1. IT’S WHY THEY’RE CALLED JUNK - 1 out of 7 high yield bonds defaulted in 2009 (14%). 1 out of 19 high yield bonds defaulted in 2020 (5.2%).  “Junk” or “high yield” bonds are rated below “Baa” by Moody’s or rated below “BBB” by S&P and Fitch (source: Fitch Ratings).
  1. VERY FEW - As of 4/15/21, only 1 out of every 13,000 fully vaccinated Americans contracted the COVID-19 virus after receiving all their shots (source: Centers for Disease Control and Prevention).
  1. IN THE RIGHT DIRECTION - US deaths from all causes (e.g., natural causes, cancer, heart disease, COVID, etc.) for the week ending Saturday 1/02/21 peaked at 84,192 (12,027 per day), but has since fallen for the next 14 weeks to 32,343 deaths for the week ending Saturday 4/10/21 or 4,620 per day (source: CDC).
  1. HOPE HE’S RIGHT - The first of 3 releases by the government on the change in the size of the US economy during the 1st quarter 2021 will be announced on Thursday 4/29/21, aka the “Advance Estimate.” Fed Governor Christopher Waller said on 4/16/21 that the US economy “is ready to rip.”  He forecasted that annual growth could be as high as +6.5% in 2021, a growth rate last achieved in 1984 (source: Commerce Department).
  1. HOW IT WAS USED - Households that received stimulus payments via the March 2020 CARES Act (HR # 478) spent 29% of the funds on “consumption,” as opposed to paying down debt, investing or saving the money. Households that received stimulus payments via the December 2020 relief legislation (HR # 133) spent 26% of the funds on “consumption.”  Households that have received stimulus payments via the March 2021 “American Rescue Plan Act” (HR # 1319) spent 25% of the funds on “consumption” (source: Federal Reserve Bank of NY).
  1. ALMOST ALL SENT OUT - As of 4/14/21, 159 million stimulus payments totaling $376 billion have been disbursed under the 3/11/21 “American Rescue Plan Act.” 22% of the $1.9 trillion bill, or $411 billion, was scheduled to be paid to eligible Americans in the form of $1,400 payments (source: American Rescue Plan Act).
  1. TAX CHEATERS - The government projected in September 2019 that our nation’s “tax gap,” i.e., the difference between what all taxpayers should have paid compared to what they actually paid, was $441 billion per year. On 4/13/21, IRS Commissioner Charles Rettig testified before the Senate Finance Committee that the “tax gap” could be as high as $1 trillion annually, or more than double the previous estimate (source: IRS).
  1. STATE MONEY - The average US state receives 48% of its tax revenue from sales taxes, 41% from income taxes, 6% from license taxes, and 5% from other taxes (source: Census Bureau).
  1. PANDEMIC IMPACT - New York City tax officials are projecting a $1 billion reduction in property tax revenue to be collected in 2022 vs. 2021, largely due to a drop in the market value of its apartments and commercial real estate (source: New York City Independent Budget Office).
  1. A RECORD - The median sales price of existing homes sold in the United States was $329,100 in March 2021, an all-time record both on a nominal basis (i.e., not adjusted for inflation) and on an inflation-adjusted basis (source: National Association of Realtors).
  1. HARD TO GET OUT - Banks repossessed 7,320 homes nationwide during the first quarter 2021, but it took an average of 930 days (more than 2 ½ years) for a repossession to be completed (source: Attom Data Solutions).
  1. THEY ALL NEED BATTERIES - Electric vehicles sales represented 5% of all passenger car sales globally in 2020. That percentage is projected to increase to 26% in 2030 and 72% in 2040 (source: Statista).
  1. COME PLAY WITH US - The NCAA announced on 4/15/21 that all collegiate athletes will have a “1-time transfer” ability without having to sit out a season. The transfer right previously was not automatically available to football and basketball athletes.  The ruling is effective for all college sports beginning this fall (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.

Read More

Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: April 19th, 2021 | 0 Comments

  1. DOUBLE DIGITS - The S&P 500 is up +11.9% YTD (total return) through the close of trading last Friday 4/16/21, the completion of the first 15 weeks of calendar year 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).
  1. ONE STOCK INDEX vs. ANOTHER - The NASDAQ Composite stock index has outperformed the S&P 500 in each of the last 4 calendar years, i.e., 2017-2020. Over the 4 years, the NASDAQ Composite has gained +150% (total return) while the S&P 500 has gained +81% (total return).  The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system (source: BTN Research).
  1. GROWING DEMAND, LAGGING SUPPLY - Inflation, as measured by the “Consumer Price Index (CPI),” was up +0.62% in March 2021, the highest monthly rate recorded in the United States since June 2009 (almost 12 years ago). There have been just 6 months in the last 30 years (360 months) when monthly US inflation has been greater than +0.62% (source: Bureau of Labor Statistics).
  1. THE PANDEMIC - The mortality rate in the USA was 1.03% in 2020, the highest mortality rate in our country in 77 years. The nation’s mortality rate peaked at 1.07% in 1943.  As recently as 2009, our mortality rate was 0.79%, the lowest rate nationwide since 1912 (source: Centers for Disease Control and Prevention).
  1. DO YOU HAVE ANY PEANUTS?1.49 million travelers went through TSA screening at US airports last Thursday 4/15/21, up from just 95,085 screened passengers on 4/15/20 but still down from 2.62 million screened passengers on 4/15/19 (source: Transportation Security Administration).
  1. MONEY IN, A LOT MORE OUT - Halfway through fiscal year 2021, i.e., the 6 months ending 3/31/21, the US government has taken in $1.7 trillion of receipts (i.e., taxes), paid out $3.4 trillion of outlays (i.e., spending), resulting in a 2021 fiscal year deficit to date of $1.7 trillion with still 6 months to go in the fiscal year. Last year’s fiscal year 2020 budget deficit of $3.1 trillion is our nation’s all-time record (source: Treasury Department).
  1. IMPACT OF TAX INCREASES - An increase in the top corporate marginal tax rate from 21% to 28% and an increase in the top individual marginal tax rate from 37% to 39.6% would result in a loss of 1 million US jobs in 2022-2023 according to a study released on Thursday 4/08/21 (source: National Association of Manufacturers).
  1. NEED A CHARGE? - The “American Jobs Plan,” a $2.3 trillion infrastructure proposal by the Biden White House on 3/31/21, includes $174 billion (8% of the total plan) to be invested in the domestic electric vehicle market. Funds would be used to build and maintain 500,000 charging stations nationwide (source: Biden White House).
  1. FORTY YEARS AGO - The average 30-year fixed rate mortgage as of 10/09/81 was 18.63%, the highest national average recorded in US history. The average 30-year fixed rate mortgage last week (as of Thursday 4/15/21) was 3.04% (source: Freddie Mac).
  1. THIRTYSOMETHING - The average age of a “first-time” US homebuyer in 2020 was 36.1 years old (source: New York Fed Consumer Credit Panel).
  1. YOUR HOME - The average property taxes paid in 2020 on a single-family home in the USA was $3,719, equal to 1.1% of the fair market value of the average home nationwide. The most expensive property tax states are New Jersey (2.20% effective property tax rate), Illinois (2.18% effective rate) and Texas (2.15% effective rate).  An average single-family home in New Jersey paid $9,196 in property taxes in 2020 (source: Attom Data Solutions).
  1. SCANDAL - An article questioning Bernie Madoff’s investment strategy (titled “Don’t Ask, Don’t Tell”) appeared in print on 5/07/01, 7 ½ years before his Ponzi scheme was discovered. When asked about the investment policy approach that he utilized, Madoff replied “it’s a proprietary strategy and I can’t go into it in great detail.”  Madoff died in prison last week (on 4/14/21) at age 82.  His prison sentence began on 7/14/09 (source: Barron’s).
  1. SKINNY THIN - Computer chips, critical to the processing capabilities of today’s computers, include copper foils that are 50 times thinner than a strand of human hair (source: Financial Times).
  1. ARTIFICIALLY LOW - Personal bankruptcies in the United States in 2020, i.e., nonbusiness bankruptcies, totaled 522,808, down 66% from 1,536,799 personal bankruptcy filings in 2010 (source: United States Courts).
  1. TOP PICK - The 3-day NFL Draft will begin on Thursday 4/29/21. Last year’s # 1 pick (Joe Burrow) signed a guaranteed contract for $36.2 million over 4 years, including $24.5 million paid in the first year (source: NFL).

- 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.

Read More

Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: April 12th, 2021 | 0 Comments

  1. STOCKS - The S&P 500 is up +10.4% YTD (total return) through the close of trading last Friday 4/09/21. The index has set 20 record closing highs this year, most recently on Friday 4/09/21.  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. HARD TO CATCH UP - A 30-year old who is investing $500 at the beginning of every month in a tax-deferred 401(k) will accumulate $588,032 by age 60 if the funds grow at +7% per year. If that individual was forced to suspend his/her monthly deferral for just 5 years from ages 35-39, he/she would have to earn +8.8% per year from ages 40-60 to accumulate $588,032 by age 60.  This mathematical calculation ignores the 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.  Actual results will fluctuate with market conditions and will vary (source: BTN Research).
  1. CAREFUL WHAT YOU ASK FOR - The last major tax reform in the United States was signed into law by President Bill Clinton on 8/10/93. 15 months later in the 1994 midterm elections held on 11/08/94, the House flipped from a Democratic majority of 258-176 to a Republican majority of 230-204, while the Senate flipped from a Democratic majority of 57-43 to a Republican majority of 52-48 (source: Congress).
  1. LARGEST PORTS - The Port of Los Angeles and the Port of Long Beach, located just 3 miles apart on the West Coast, are the 2 busiest American ports as measured by total container trade (source: iContainers.com).
  1. CLOSE THE DOOR? - 32% of Americans surveyed believe that foreign imports shipped into the United States represent a “threat” to the US economy (source: Gallup’s 2021 World Affairs survey, February 2021).
  1. HOME BUILDING - 991,000 single-family homes began construction in 2020, the 9th year of increasing home starts since this measurement bottomed at 431,000 in 2011. The all-time US record for home starts in a single year is 1.72 million in 2005 (source: Census Bureau).
  1. BEFORE RATES RISE - In a report released on Monday 4/05/21, an estimated 1 out of every 8 homeowners (12.2%) with a mortgage had refinanced their loan to a lower interest rate in just the previous 6 months (source: Survey of Consumer Expectations Housing Survey).
  1. IT’S GOING HIGHER - 205 of 220 money managers (93%) expect inflation to rise over the next year. The study, released on Tuesday 3/16/21, surveyed fund managers who collectively manage $630 billion of assets or approximately $3 billion per manager.  Inflation, using the CPI as the measurement, was up +1.7% on a year-over-year basis through 2/28/21 (source: Bank of America).
  1. SO HE SAYS - President Joe Biden predicts his “American Jobs Plan,” released on Wednesday 3/31/21, would create 19 million working class jobs in the USA if enacted as designed (source: Biden White House).
  1. NO COMMUTE - 3 out of every 4 American families (73%) reporting household income of at least $200,000 switched to a “work-from-home” structure when the pandemic began in 2020 (source: Census Bureau).
  1. COMPASSIONATE FOLKS - 1 out of every 7 American workers (14%) is employed in the health care industry, a total of 22 million individuals (source: Census Bureau’s 2019 American Community Survey).
  1. THE FLU - “Flu season” is defined as the 8 months from October-May. An average of 36,000 Americans died of flu per year over the last decade, but just 22,000 deaths occurred during the 2019-2020 season (source: CDC).
  1. IS THERE AN EXECUTIVE ACTION COMING? - Any student loan debt that is forgiven after 12/31/20 and before 12/31/25 will not create “taxable income” for the borrower. This tax provision was part of HR # 1319 (aka the “American Rescue Plan Act”) that was signed into law by President Joe Biden on 3/11/21.  However the pandemic-relief legislation did not include language implementing any student loan forgiveness  Please consult a tax expert for details (source: HR # 1319, Section # 9675).
  1. WE SHOULD TOO - The UK’s “State Pension,” analogous to the USA’s Social Security, has been increasing the age at which a UK citizen can claim the benefit from age 65 in November 2018 to 67 by 2028 (source: ageuk.org).
  1. A (BIG) BUSINESS - Oral arguments were heard on 3/31/21 before the Supreme Court in “National Collegiate Athletic Association v. Alston.” A lower court ruling in favor of collegiate athlete Shawne Alston would allow for compensation to be paid to student-athletes, a ruling that the NCAA then appealed to the Supreme Court.  College sports generated an estimated $14 billion in revenue in 2020 (source: Supreme Court).

- 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.

Read More

Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: April 5th, 2021 | 0 Comments

  1. STOCKS - In the last 30 years, the best 12-month performance for the S&P 500 occurred over the 1-year period that ended last Wednesday 3/31/21. The S&P 500 gained +56.4% (total return) from 3/31/20 to 3/31/21.  Ironically, 3/31/20 was the date that the Trump White House announced US pandemic deaths could be 100,000 to as high as 240,000.  Pandemic deaths were 3,000 on 3/31/20.  Pandemic deaths were 551,000 as of 3/31/21.  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. MOST INVESTORS WERE WRONG - As of 3/31/20, i.e., a year ago, 66% of stock investors were “bearish” (50%) or “neutral” (16%) on the direction of the US stock market over the upcoming 6 months (source: American Association of Individual Investors).
  1. BEST STOCK MONTH - April has been the # 1 best month for the S&P 500 index over the last 30 years, i.e., 1991-2020, gaining an average of +2.17% (total return). The month of November (average gain of +1.92%) has been the # 2 best performing month over the last 3 decades (source: BTN Research).
  1. A FORCE - As of mid-February 2021, retail stock traders represent 23.0% of all US equity trading (by dollar volume), more than double the 10.1% they accounted for in 2010 (source: Bloomberg Intelligence).
  1. BONDS - Long-dated Treasuries lost 15.8% (total return) over the 1-year ending 3/31/21. The Bloomberg Barclays Long US Treasury Index, which includes all Treasury securities with a remaining maturity of at least 10 years and having at least $250 million of outstanding face value, was used as the proxy (source: Bloomberg).
  1. IN SEARCH OF YIELD - American corporations issued $140 billion of “junk-rated” bonds in the first quarter 2021, the highest quarterly volume of “junk” bonds in US history. “Junk” or “high yield” bonds are rated below “Baa” by Moody’s or rated below “BBB” by S&P (source: Refinitiv).
  1. THEY’RE BUYING BONDS - 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 3/17/21 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. FED TARGETS - In Chairman Jerome Powell’s 3/17/21 post-meeting press conference, he said the Fed will not raise interest rates until our nation records a 3.5% unemployment rate and annual inflation of at least 2%. The country’s jobless rate as of March 2021 was 6.0% and inflation, using the “personal consumption expenditures” (PCE) index preferred by the Fed, was up +1.6% for the 1-year through 2/28/21 (source: Federal Reserve).
  1. WEALTHIEST - The top 10% of US households (as measured by net worth) own 70% of all assets nationwide as of 12/31/20, i.e., $85.6 trillion out of $122.9 trillion. The bottom 50% of US households own just 2% of all assets as of 12/31/20, i.e., $2.5 trillion out of $122.9 trillion (source: Federal Reserve).
  1. LOWEST PAID, HARDEST HIT - 82% of the net job losses in the United States in calendar year 2020 were suffered by workers in the bottom 25% of wage earners (source: Economic Policy Institute).
  1. WORK-FROM-HOME - 25% of the workforce in the advanced economies worldwide could work from home between 3-5 days a week without any loss of productivity (source: McKinsey & Company).
  1. TAXES - Property taxes levied on office buildings and on private residences make up an estimated 30% of the tax revenue collected by American cities and towns, i.e., local governments (source: Urban Institute).
  1. WAIT TILL THE COST OF MONEY GOES UP - During fiscal year 2020, i.e., the 12 months ending 9/30/20, the US government spent $345 billion for interest payments on the national debt or $945 million a day. 5 years earlier, i.e., fiscal year 2015, the US government spent $223 billion for interest payments on the national debt or $611 million a day (source: Treasury Department).
  1. ADDING MORE DEBT - Total US household debt, including mortgages, credit cards and auto loans, was $12.67 trillion as of 12/31/08. Over the next 5 years, total household debt fell $1.15 trillion to $11.52 trillion as of 12/31/13.  But over the last 7 years, total household debt has increased $3.04 trillion to $14.56 trillion as of 12/31/20 (source: Federal Reserve Bank of New York).
  1. HE DOES BOTH - Los Angeles Angels baseball star Shohei Ohtani, a 2-way player, hit a 468-foot home run as a batter and reached 100 mph as a pitcher during Spring Training 2021 in Arizona (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.

Read More

Bill’s By The Number$

Posted by:Lisa Navarro | Posted on: March 29th, 2021 | 0 Comments

  1. YEAR-TO-DATE RESULTS - With just 3 trading days remaining in the 1st quarter 2021, the S&P 500 stock index is up +6.2% YTD (total return) through the close of trading as of last Friday 3/26/21. The index, created in 1957, has achieved 15 record closing highs this year, including its latest on 3/26/21.  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).
  1. BAD QUARTER - The worst year for the taxable bond market in the last 45 years (1976-2020) was a loss of 2.92% (total return) in 1994. The YTD performance (through last Thursday 3/25/21) of the taxable bond market was a loss of 3.13% (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. BONDS - The US bond market (including treasury, municipal, corporate, mortgage and asset-backed debt) was worth $49.9 trillion as of 12/31/20. Treasury debt ($21.0 trillion) makes up the largest piece of the US bond market (source: Securities Industry and Financial Markets Association).
  1. STOCKS - The US stock market, including 3,463 public-traded companies on the NYSE, AMEX and NASDAQ, was worth $41.2 trillion as of 12/31/20 (source: Wilshire).
  1. STATUS QUO FOR TWO MORE YEARS - The most recent meeting of the Fed ended on 3/17/21 with their interest rate forecast calling for no interest rate hikes by the Fed until at least 2023 (source: Federal Reserve).
  1. HAVE KIDS, GET MONEY - An estimated 40% of the 126 million households in the United States have children under the age of 18, or 50 million households. An estimated 90% of the 50 million households (45 million) will qualify for the expanded Child Tax Credit (CTC) per the American Rescue Plan Act of 2021.  The new CTC could pay $300 per month per child under age 6 and $250 per month per child between ages 6-17 beginning 7/01/21.  Please consult a tax expert for details (source: Tax Policy Center).
  1. THEY’LL SPEND IT SOMEWHERE - American consumers spent $2.81 trillion on foreign imports of goods and services in calendar year 2020. American consumers are forecasted to receive $800 billion in the form of stimulus payments, unemployment benefits and child tax credits through the American Rescue Plan Act of 2021, and then turn around and spend $360 billion of the $800 billion on foreign imports.  Chinese companies are predicted to sell Americans $60 billion of the $360 billion (source: Allianz).
  1. TWO SUPERPOWERS - The United States and China makes up 40% of the world’s gross domestic product (source: Barclays Investment Bank).
  1. HIS PROMISE - President Joe Biden said on Wednesday 3/17/21 that “anybody making more than $400,000 will see small-to-a-significant tax increase.” Biden wants the changes to be effective 1/01/22.  US presidents are paid $400,000 per year (source: ABC’s Good Morning America).
  1. TRIPLE DIGITS - The price of oil - $60.97 a barrel as of the close of trading last Friday 3/26/21 – last closed above $100 a barrel on 7/30/14, or nearly 7 years ago (source: NYMEX).
  1. WOMEN RULE - The 17.8 million college students who enrolled in the fall of 2020 were split 41% male and 59% female. 17.8 million students are down just 2.5% from the 18.2 million students who enrolled in the fall of 2019 (source: National Student Clearinghouse Research Center).
  1. WE DID IT BEFORE - The Works Progress Administration (WPA) was created by President Franklin Roosevelt in 1935 during the Great Depression. During its 8 years, the WPA provided employment and wages for an estimated 40% of jobless Americans.  The WPA built schools, hospitals and bridges (source: History.com).
  1. INFRASTRUCTURE - American roads and bridges will require an estimated $2.8 trillion of repairs and upgrades over the 10 years from 2020-2029 (source: The American Society of Civil Engineers).
  1. NO TEST SCORE NEEDED - Students applying to Ivy League school Cornell University for the 2022-2023 school year do not have to include ACT or SAT test scores with their applications (source: Cornell University).
  1. FOOTBALL - The NFL announced on Thursday 3/18/21 an 11-year media deal worth $113 billion for the seasons 2023-2033. That’s equal to $321 million per team per year over the duration of the agreement (source: NFL).

- 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.

Read More

Bill’s By The Number$

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

  1. “TIME IN” vs. “TIMING” - The split between “up” and “down” time periods for the S&P 500 index from 1950 to the end of 2020, i.e., the last 71 years, as measured by: Days: 54% up and 46% down; Months: 60% up, 40% down; Quarters: 67% up, 33% down; Years: 73% up, 27% down; 5-Year Rolling Time Periods: 79% up, 21% down; and finally 10-Year Rolling Time Periods: 89% up, 11% down. 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).
  1. MULTIPLIER – The “American Rescue Plan Act of 2021” includes $1,400 cash payments made to 110 million households. If each taxpayer that received $1,400 had a “marginal propensity to consume” of 60%, the initial taxpayer would save $560 and spend $840, and then in turn the party that received the $840 would save $336 and spend $504, and the next party would save $202 and spend $302, and so on.  Ultimately the original $1,400 cash payment would result in $2,100 of economic activity, i.e., $840 + $504 + $302 + . . . (source: BTN Research).
  1. MONEY THAT THEY WILL SPEND - 42% of the $1.9 trillion “American Rescue Plan Act of 2021,” i.e., $800 billion out of the $1.9 trillion, is direct support that will be distributed to households in the form of stimulus payments, unemployment benefits and child tax credits (source: American Rescue Plan Act of 2021).
  1. TRILLIONS TO HELP - The 6 bills (totaling $5.6 trillion of aid) passed by Congress to combat the impact of the pandemic in the last 13 months are 1) HR # 6074 ($8.3 billion in March 2020); 2) HR # 6201 ($3.5 billion in March 2020); 3) HR # 748 aka the CARES Act ($2.3 trillion in March 2020); 4) HR # 6312 aka CARES # 2 Act ($484 billion in April 2020); 5) HR # 133 ($900 billion in December 2020); and 6) HR # 1319 aka the American Rescue Plan Act ($1.9 trillion in March 2021) (source: Congress).
  1. ALMOST HALF OF ADULTS - 46% of American adults experienced a loss of income or they live with someone that experienced a loss of income in the nearly 1-year following President Donald Trump’s declaration of a pandemic-driven “national emergency,” i.e., from 3/13/20 to 2/28/21 (source: Census Bureau).
  1. SAME NUMBER ABOVE AND BELOW - 50% of the 153.8 million Form 1040s that were filed for tax year 2018 (a total of 76.9 million returns) reported less than $40,000 of adjusted gross income (source: IRS).
  1. AND IN THE NEXT YEAR - 2020 was the 10th year in the last 70 years, i.e., 1951-2020, that the US economy had contracted. Our nation’s “gross domestic product” (GDP) shrunk by 3.5% last year.  Following the 9 previous “down” years, the US economy has rebounded in the next year with positive growth 7 out of 9 times, growing by an average of +3.3% per year for all 9 “bounce back” years (source: Commerce Department).
  1. AN OPINION - Jamie Dimon, JPMorgan Chase CEO, forecasted on 3/01/21 that “there’s a very good chance you’re going to have a gangbuster economy for the rest of 2021 and easily into 2022” (source: Bloomberg TV).
  1. FED THINKS - The median forecast (released on Wednesday 3/17/21) made by the 11 members of the Federal Open Market Committee (FOMC) for “change in real GDP” during 2021 was +6.5%. Actual GDP (gross domestic product) annual growth has been at least +6.5% just once (1984) in the last 50 years (source: Federal Reserve).
  1. LESS BABIES - The global “total fertility rate” has been cut in half (down 51%) in the last 50 years, falling from 4.922 “births per woman” in 1968 to 2.415 “births per woman” in 2018 (source: The World Bank).
  1. TEN YEARS APART - Banks repossessed just 1,428 homes nationwide in January 2021. Banks repossessed 78,133 homes nationwide in January 2011 (source: Attom Data Solutions).
  1. RIGHT DIRECTION - As of 9am ET on Friday 3/19/21, 8,327 Americans had died from the COVID-19 virus over the previous 7-day period. That’s the 7th consecutive week of declining US death totals from the pandemic and represents a 64% drop in weekly deaths since Friday 1/29/21 (source: NBC News).
  1. LONG OVERDUE - The federal gas tax is 18.4 cents per gallon today, but the tax has not been raised since 10/01/93 or nearly 27 ½ years ago. However 37 US states have raised their respective state gas tax since 2010.  Gas taxes are used to fund improvements to highways and bridges (sources: Amer. Society of Civil Engineers).
  1. NOT GOING – 2.17 million freshmen started college in the fall of 2020, down 13% (327,513 fewer students) from the 2.50 million freshmen that began college in the fall of 2019 (source: National Student Clearinghouse).
  1. NICE JOB - Justin Thomas, the # 2 ranked golfer in the world, won $2.7 million on Sunday 3/14/21 with his win at The Players Championship in Florida, the largest payout from a single golf tournament in history (source: PGA).

- 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.

Read More

Bill’s By The Number$

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

  1. STOCKS AND HIGH INFLATION - During the 15 highest inflation years (using the “Consumer Price Index” as the benchmark) over the last 100 years, i.e., 1921-2020, the S&P 500 stock index has been “up” 7 years and “down” 8 years. The index’s average performance for the 15 years is +2.5% per year (total 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. SINCE THEN - President Trump declared the coronavirus pandemic a “national emergency” on Friday 3/13/20. Over the 1-year since that announcement, i.e., Monday 3/16/20 through last Friday 3/12/21, the S&P 500 gained +48.0% (total return), in spite of a horrible 12.0% loss (total return) on Monday 3/16/20 (source: BTN Research).
  1. PUT IT ON THE CARD - In the 1-year since the declaration of a “national emergency” on 3/13/20, the US national debt has increased $4.46 trillion from $23.44 trillion to $27.90 trillion (source: Treasury Department).
  1. RISING RATES - From its all-time closing low of 0.501% on Monday 3/09/20, the yield on the 10-year Treasury note has more than tripled to close at 1.634% as of last Friday 3/12/21 (source: Treasury Department).
  1. ADDING TO CASH - Money market funds in the United States, including retail and institutional funds, both taxable and tax-free, have increased $615 billion (to $4.39 trillion) over the last 12 months through last Friday 3/12/21, an average increase of $12 billion a week (source: Investment Company Institute).
  1. BY PARTY - In the last 100 years (1921-2020), Republicans have a 52-48 edge over the Democrats in “years in the White House.” Inflation (using the “Consumer Price Index” benchmark) has been +1.9% per year during the Republicans’ 52 years, while inflation has been +3.4% per year during the Democrats’ 48 years (source: DOL).
  1. BLAME THE PANDEMIC - Total exports of goods and services by American corporations in calendar year 2020 were $2.13 trillion, down 16% from the year before and the smallest total recorded nationwide since 2010 (source: Bureau of Economic Analysis).
  1. WHO IS RIGHT? - In a 2/10/21 speech to the Economic Club of New York, Federal Reserve Chair Jerome Powell said, “published unemployment rates (from the Department of Labor) during COVID have dramatically understated the deterioration in the labor market.” He speculated an accurate jobless rate as of 1/31/21 was “close to 10%.”  As of 1/31/21, the official national jobless rate was 6.3% (source: Federal Reserve).
  1. YEAR-OVER-YEAR IMPROVEMENT - The aggregate earnings per share of the companies in the S&P 500 in the 1st quarter 2021 are forecasted to be +21.5% greater than the actual aggregate earnings per share of the S&P 500 companies from the 1st quarter 2020 (source: FactSet).
  1. NEW BUSINESSES - The 4 top months for “business applications” in US history have occurred since July 2020, i.e., during the pandemic. The all-time monthly record (582,334 applications) was set in July 2020, followed by January 2021 (497,539), September 2020 (463,175) and August 2020 (430,489) (source: Census Bureau).
  1. TAXES - The American Institute of CPAs (AICPA) sent a letter on 3/04/21 to the commissioner of the IRS requesting a 2-month delay of the 2021 tax deadline, i.e., from 4/15/21 to 6/15/21. The organization believes that filing obligations due a month from today are “simply not possible for many taxpayers” (source: AICPA).
  1. REALLY RICH FOLKS - Senator Elizabeth Warren (D-MA) proposed on 3/01/21 the “Ultra-Millionaire Tax Act” that would impose an annual wealth tax on households with at least a $50 million net worth. The tax would begin in 2023 and would impact an estimated 100,000 US households (out of 126 million total US households).  The bill’s tax rate is 2% on estates between $50 million and $1 billion, rising to 3% on estates valued in excess of $1 billion.  For Jeff Bezos, worth $181 billion as of the close of trading on Friday 3/12/21, the wealth tax would cost him $5.4 billion annually at his current net worth level (source: www.warren.senate.gov).
  1. NOT WHAT IT USED TO BE - To rank in the top 1% of US taxpayers took $85,428 of adjusted gross income (AGI) in 1981. To rank in the top 25% of US taxpayers took $87,044 of AGI in 2018 (source: Internal Revenue Service).
  1. THEY NEED MONEY - Hawaii’s state Senate passed legislation last week (3/09/21) to increase its top marginal tax rate to 16% (from 11% today) on taxable income of more than $200,000. The bill, which would give Hawaii the highest marginal tax rate in the nation, moves onto the Hawaii state House for debate (source: Hawaii Senate).
  1. LIKE FATHER, LIKE SON - Both Cecil Fielder (who played 13 MLB years) and his son Prince Fielder (who played 12 MLB years) each hit 319 home runs in their respective major league baseball careers (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.

Read More

Bill’s By The Number$

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

  1. LAST TWO BULLS - From its 3/23/20 bear market low, the S&P 500 has gained +74.6% (total return) in the 240 trading days through Friday 3/05/21. From its 3/09/09 bear market low, the S&P 500 gained +67.4% (total return) in the first 240 trading days of what became a nearly 11-year bull market run that ended on 2/19/20.  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. IN MY LIFETIME - Last year’s (2020) contraction of the US economy (down 3.5%) was the largest drop our nation has experienced since 1946 or 74 years earlier (source: Bureau of Economic Analysis).
  1. WHAT A COMEBACK – Many American employers have recovered and as of 2/28/21 they have hired back 67% of the 25.4 million jobs that were lost last year during the 2 months of March-April 2020 (source: DOL).
  1. PANDEMIC BILL - The $1.9 trillion “American Rescue Plan Act of 2021” that the House passed would provide stimulus payments to an estimated 93% of US households (117 million). The Senate version of this legislation would provide stimulus payments to 87% of US households (110 million) (source: Penn Wharton Budget Model).
  1. IT’S THE RENTERS THAT ARE HURTING - Just 1 in 39 homeowners (2.5%) was at least 3 months behind in paying their monthly mortgage as of 12/31/20. However 1 in 5 renters (20.5%) was at least 3 months behind in paying their monthly rent as of 12/31/20 (source: Consumer Financial Protection Bureau).
  1. YOUR HOME - 62% of home mortgages (33.4 million) are federally backed, i.e., the loans are guaranteed by Fannie Mae, Freddie Mac, the Federal Housing Administration or the Veterans Benefits Administration. The government announced on 2/16/21 that the moratorium on foreclosures and evictions on federally backed, single-family home mortgages had been extended to 6/30/21 (source: Federal Housing Finance Agency).
  1. QUICK, BEFORE RATES RISE - 13% of outstanding home mortgages nationwide as of 12/31/20, i.e., 7.2 million mortgages out of 53.9 million mortgages, were refinanced during 2020 (source: Federal Reserve Bank of NY).
  1. IMPACT ON BOND INVESTORS - The yield on the 10-year Treasury note rose 0.37 percentage points (from 1.09% to 1.46%) in February 2021. That’s the largest monthly rise in the 10-year note yield since November 2016 when the yield went from 1.84% to 2.37%, a jump of 0.53 percentage points (source: Treasury Department).
  1. HIS OPINION - Legendary investor Warren Buffett released his annual letter to investors on 2/27/21. Referring to the recent rise in the yield of the 10-year Treasury note, Buffet opined that “bonds are not the place to be these days.  Fixed-income investors worldwide – whether pension funds, insurance companies or retirees – face a bleak future.”  The release was Buffett’s 56th annual letter (source: Berkshire Hathaway).
  1. IN SEARCH OF YIELD - American corporations issued $52 billion of “junk-rated” bonds in January 2021, the 3rd highest monthly volume of “junk” bonds in US history. A record $438 billion of “junk” bonds were issued in calendar year 2020.  “Junk” or “high yield” bonds are rated below “Baa” by Moody’s or rated below “BBB” by S&P (source: S&P Global Market Intelligence).
  1. ALMOST FIVE YEARS EARLY - The Congressional Budget Office (CBO) released a 10-year forecast on 1/19/16 (i.e., 5 years ago) of the projected size of our national debt. The non-partisan agency predicted that our national debt, $18.9 trillion in size as of 1/19/16, would reach $28.003 trillion as of 12/31/25.  As of last Monday 3/01/21, the national debt was $28.004 trillion (source: CBO).
  1. WHO OWNS WHAT - 39% of the US government debt that is “held by the public” was foreign owned in 2019 (the most recent year that data is available), down from 48% in 2008 (source: USA Facts).
  1. PAY NOTHING ON APRIL 15TH - 35% of the 153.8 million tax returns that were filed nationwide for tax year 2018 (the latest year for which data has been released) did not pay any federal income tax, a total of 53.4 million tax returns. 90% of these “non-taxable” returns (48.0 million returns) reported adjusted gross income of less than $40,000 (source: Internal Revenue Service).
  1. PANDEMIC, AND AFTER - The price of West Texas Intermediate (WTI) crude oil fell to $22.76 a barrel as of 4/09/20, i.e., 11 months ago. As of Friday 3/05/21, WTI crude oil closed at $66.09 a barrel (source: NYMEX).
  1. MONEY WENT TO MADOFF INSTEAD - Instead of paying professional baseball player Bobby Bonilla $5.9 million as he was owed in 1999, the New York Mets negotiated to pay Bonilla $1,193,248 every July 1st from 2011 through 2035, a total of $29.8 million over 25 years (source: New York Mets).

- 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.

Read More