Economic impact factors
This past winter has had a big impact on the economy. The groundhog is telling us winter may not be over yet. We are tracking real factors that can have an economic impact as well as other statistics from the Super Bowl to the Stock Trader’s Almanac.
-Greg Powell, CIMA, President/CEO, Wealth Consultant
00:44: Events that have economic impact
Last week said goodbye to Ben Bernanke as Janet Yellen becomes the first woman Fed Chair in its one hundred year history. The Fed has turned back the faucet on bond buying and believes that if inflation stays below the 2% threshold, there could be a risk of deflation (as Greg talked about in his last blog).
Believe it or not: The Stock Trader’s Almanac states that historically, January will have a major economic impact on the year. Interestingly, the Super Bowl is thought to have an economic impact as history shows when an old NFC team wins, the market turns bullish.
Emerging markets continue to create an economic impact. Although countries like Argentina and Venezuela represent 1.5% of the U.S. GDP, it brings about a confidence issue in our economy. This week the employment report and the ISM manufacturing report could have an economic impact, so we are watching that closely.
- Franklin Bradford, CMT, Senior Vice President, Wealth Consultant.
3:38: Janet Yellen’s economic impact
As soon as Janet Yellen settles into her new office today she will be faced with some difficult decisions concerning inflation. Yellen has experience dealing with many economic impact factors. She has worked with the Fed for some time and was the architect of Quantitative Easing.
The new Fed Chair’s tough decisions could have a negative economic impact in two ways. First, if she takes interest rates up too soon, this could dampen the current slow economic recovery. On the other hand, if she takes too long, it could fuel inflation or create a financial bubble. It’s a difficult decision because of the uncertain and moving employment and wage growth data reports.
- Ashley Page, JD, MBA, Senior Vice President, Wealth Consultant.
6:15: Is there confidence in Yellen?
We believe Janet Yellen has a wealth of knowledge and could very well be a competent Fed Chair. There could be a new way of looking at the employment and wage growth numbers and a way to alleviate a harsh economic impact. A re-evaluation of these statistics could help Yellen’s decision making process.
We are tracking all these factors and more every day for our clients. We are committed to creating investment strategies to lessen the economic impact on our clients’ portfolios. Please comment below as we value your questions and feedback.
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fi-Plan Partners is an independent investment firm in Birmingham, AL serving its clients across the nation through financial planning, wealth management, economic outlook research, and business consulting.
Securities Offered Through LPL Financial. Member FINRA/SIPC.