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Thoughts to Ponder and The Market Update February 13

Thoughts to Ponder and The Market Update February 13
February 13, 2017 abryant

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Thoughts to Ponder . . .

  • Sometimes you succeed…. and other times you learn.
  • To thrive in life you need three bones. A wish bone, a back bone, and a funny bone.
  • It is not important how much an item costs, it’s more important how much you can save when you buy it.
  • The decision to decide is a decision in itself.

 

 And Now on to The Market Update . . .

Corporate profits and resumed business optimism, relating to President Trump’s economic policies, has investors feeling more confident in business growth for 2017.

  • The Dow Jones Industrial Average, after struggling to stay above the 20,000 mark, seems to have taken a foothold at a new record level above the 20k benchmark.

 

Mortgage rates, which have declined slightly over the last week and the current week, have given a boost to mortgage applications.

  • The Mortgage Bankers Association of America has reported for the week of February 3rd that both purchase and refinance applications increased 2.0 percent.
  • In the overall picture of mortgage financing, applications for refinances represent 47.9 percent of total applications.
  • This is the lowest level since June of 2009.

 

In the absence of housing data this week, the labor market received most of the attention this week.

  • January’s employment numbers showed a jump of 227,000 new jobs in the nonfarm payroll category.
  • Analysts were expecting only 175,000.
  • The unemployment rate increased by .1 percent up to 4.8 percent.
  • The increase is representative of more people attempting to return to the workforce and not increasing layoffs.

 

There is no shortage of jobs available.

  • The challenge that now exists for employers is that they are struggling to find qualified candidates to fill the positions.
  • The pool of under skilled job seekers has increased.
  • What this means is that the people searching for work, may not have the most up to date education or skill sets that applies to the current needs of employers.

 

You may remember that when the recession hit, there was much talk about how people who lost their jobs were advised to learn new crafts in order to keep up with innovation.

  • It appears that the changing dynamics of technology and staffing has absorbed those people into the workforce who took the initiative to learn new skills.
  • Individuals who did not move forward with re-training appear to be struggling more to obtain employment today.

 

Further validating the point of a greater unskilled workforce is that first time jobless claims continue to remain at very low levels.

  • For the week ending February 4th, claims were down to 234,000.
  • This is one of the lowest numbers ever on record.
  • The 4-week moving average is now down to 244,250, which is the lowest reading since 1973.
  • Layoffs are not the problem, as stated earlier, it is the need for employees with the right skills for current open positions that continues to be the biggest challenge to the labor force.

 

The Bloomberg Consumer Comfort Index, which is a random-sample survey tracking Americans’ views on the condition of the U.S. economy, personal finances, and the buying climate, has risen to a new post-election high.

  • The indications of this index point to the likelihood that consumer confidence will show strength in the next report as well.

 

This week’s many potential market moving reports are:

  • Tuesday February 14th – Producer Price Index
  • Wednesday February 15th – MBA Applications, CPI, Retail Sales, and Industrial Production
  • Thursday February 16th – First Time Jobless Claims & Housing Starts
  • Friday February 17th – Leading Indicators