Like proud children when they lose teeth, the S&P 500 turned positive for the year and the NASDAQ reached a thirteen and a half year high when they crossed 1,847.61 and 4,292.96 respectively this week. This continues the endless good news for investors, which is why we suggest becoming a part of the investor class as soon as possible. Follow the money to make money.
Despite the market rally, consumer confidence dropped to 78.1 in February. This was about as shocking as the attention seeking Miley Cyrus after the service sector slowed down to 52.7 in February from 56.7 in January, U.S. jobless claims increased by 14,000 to 348,000, bookings for durable goods orders (stuff that lasts three years) decreased 1 percent and payroll gains came in at 113,000 instead of the projected 180,000. Being an economist is apparently as hard as being a weatherman.
Gas prices increased $0.12 on average over the last two weeks across the nation because other countries can’t play nice in the sandbox. Hopefully the U.S. doesn’t see this as an opportunity to wage war. Obama’s approval numbers are low, though, so maybe he’ll see a need to wag the dog.
Speaking of edible animals, cows and pigs will make for expensive dinners because of low stocks due to droughts across the Midwest and west, especially in California, and a disease plaguing the Wilburs of the world. Now may be a good time to go vegetarian or vegan.
Dorothy’s proclamation that there’s no place like home was never more true than the end of 2013, when U.S. single-family home values increased 0.8% from November to December 2013, until new home sales reported a five and a half year high in January 2014 by increasing 9.6 percent or 468,000 units from the previous month. Maybe the polar vortex wasn’t as polar-vortexy as we thought. (6) Meanwhile, Phoenix, AZ, a U.S. home sale’s bellwether, reported this week its first monthly decline since 2011 also took place in December. As far as we know, Phoenix didn’t have snow, but they would be smart to prepare for a plague any day now just as the rest of the country should prepare for a broad-based dip in home sales.
While, somewhat like the Congressional Budget Office (CBO), we still see positive signs for the economy to improve at a snail’s pace. We don’t, however, see it from gnarly data, but rather from more traditional data and believe assertions blaming uncertainty for the slow recovery has become a lame claim.
This week is America Saves Week, but you wouldn’t know it from the recent report that suggests only about one-third of Americans are living within their means and saving for long-term financial goals (a.k.a. the future). America has a unique love affair with big homes and cars and while this isn’t all bad, we’re risking future happiness for near-term happiness.
America has a retirement savings problem in large part because we are too much like J. Wellington Wimpy and think we’ll certainly have money in the future. While some expenses do decrease, in the future, after our working years some expenses, such as healthcare, can increase. This is just one of a couple of reasons why many are leaving the country, if only temporarily, like their leaving big banks.
We could all plan better for retirement and nothing’s more popular online these days than fun quizzes. As we always say, the best start to creating a financial plan is to be like Cheap Trick and know what you want because what isn’t cheap is to be unprepared or to rely on someone else, as any confusion on your part often means money on theirs.
So, while you may be doing even better than traditional data suggests, focus on reducing your expenses and saving more. While the economy slowly improves, slowly improve your personal financial situation and prepare yourself for person financial instability and uncertainty. “These are not the droids you want.”