Do it! Drink a bunch of mulled wine and go caroling. Nothing says “Christmas” like a gaggle of sloshed carolers trampling your lawn or Bill O’Reilly’s annual cry about the “War on Christmas”. Someone has books to sell.
This week’s subheading inspiration is actually just “Go Caroling Day”. We took artistic liberty, as if there’s any left in the U.S. not approved by Kim Jong Il’s mini-me, and added “Get Drunk” because, well, that’s what we’d do.
Overall, this week in economics fared better than Madonna’s trust in security. Housing remains the unpredictable drunk girl at your office holiday party. Why must she be so loud and so close?!
First on Monday, the Federal Reserve reported its November U.S. Industrial Production Index that showed an increase of industrial production by 1.3 percent after October’s 0.1 percent increase. This is the largest gain in four and a half years and suggests that manufacturing/economic relations are better than Jolie/Pascal relations. Job seekers seeking jobs should seek jobs in manufacturing.
Then, the National Association of Home Builders (NAHB) released its December Housing Market Index, which fell one point to 57 from November’s 58 points. This somewhat flat trajectory remains two points within September’s nine-year high of 59 and is the sixth month in a row above 50. 50 points suggests economic expansion, like 50th birthdays suggests waistline expansion.
Home builder sentiment slipped in three of the four U.S. regions, but rose in the West to its highest since December 2005. Similar to the unexpected response of gifting a banana and an onion for Christmas, home builders are expected to remain confident into 2015. The future expectations component kept the index up, while a dearth of first-time home buyers was the drag.
Continuing with the somewhat mixed housing data on Tuesday, the Commerce Department’s November Housing Starts Index was released. It showed that new home construction starts fell 1.6 percent last month to 1.03 million, after October’s upwardly revised increase of 1.7 percent. This is the third straight month with starts above one million, the first such occurrence since early 2008. November’s strength was multi-family starts, typically rentals. Its weakness was building permits. Overall, housing growth is flat to modestly positive and suggests it’s a good time to look at homes if you’re looking for a home.
Wednesday brought the Labor Department’s November Consumer Price Index (CPI), which dropped sharply by 0.3 percent, after October’s unchanged reading from September. This is the largest drop since December 2008 and a faster surrender than Sony Pictures. Energy prices plunged 3.8 percent from October, led by a 6.6 percent drop in gasoline prices, as you’ve no doubt perceived at the pump. Excluding food and energy, consumer prices increased 0.1 percent. Save this savings.
The Conference Board’s November Index of Leading Indicators was released on Thursday and showed a 0.6 percent increase in November, its third straight monthly advance. This follows October’s 0.9 percent increase and confirms the only thing improving more quickly than the economy is the Democrat voter pool (a.k.a. U.S./Cuba relations).
Friday was Quadruple Witching, which you’d logically believe meant the last four broom pilots I worked for were up to their witchy ways again, but you’d be wrong. It’s actually the term for the somewhat rare occurrence when various stock index futures, stock index options, stock options and single stock futures all expire on the same day. That’s a bit of stock market edification for your early morning.
All signs point to an improving economy, albeit with too many 2008 references, and we’re happy to see consumer spending isn’t rising faster than wages. Stay judicious with spending, investing and saving. The current bull market run, which started in March 2009, is the fourth longest bull market run in history. As of today, the annual Santa Claus rally seems to be as reliable as San Francisco’s naked Santa run. And, per Barron’s, the bull should continue its run into 2015.
Use these economic and stock market opportunities to repair past mistakes and prepare for future ones. Participating in such gains doesn’t require an expensive money manager, either, as is evidenced by the fact that 85 percent of actively managed large cap mutual funds are trailing the S&P 500 year-to-date. That’s per Goldman Sachs, who has a vested interest in selling expensive advice to the rich.
Speaking of having books to sell, keep your eyes peeled for our fourth book and first full-length book, 4: The Four Principles of a Debt Free Life, coming Friday, January 2, 2015. If you need help with the nitty gritty steps to climb out of debt, this fun read will give you four simple steps to do so.
That’s this week’s #moneyconscious Mash Up. Come back every Saturday for our nonsensical take on a snoozer topic.