There’s so much news out there that causes a lot of tension and anxiety throughout this country and in the markets. That alone has caused some of the high emotions and volatility recently and we thought we would address that in today’s vlog. There’s been talk about the China and U.S. trade wars and the discussion on impeachment. At Fi Plan Partners, we’ve always said that anxiety is only worry with anticipation. If you look at our information and if you read Greg’s book, you will see that we also, in working with a financial blueprint and matching that up with market performance, we like to say that anxieties are events that, nine times out of ten, will never occur. Once you have the knowledge, you then have the confidence to confront the fear. In the environment we’re in, the emotionally driven news is probably going to continue for a while due to the upcoming election year. You’re most likely going to see a lot of high anxiety and the best thing you can do is get the knowledge that gives you confidence about your portfolio and to see if your goals are on track. The real headlines are always on the back pages of the newspaper and usually not the main focus.
It’s hard to believe that we are a little over 50 days away from Christmas and the holiday season. Consumer spending usually picks up from November 1st to December 31st and this year, sales are expected to increase 4% from last year. Last year, the stock market was in a nasty pullback during the holiday season. People might not have spent as much as they usually would as a result of that. Hopefully the market will continue to strengthen, and consumers will feel strong going into this holiday to increase retail sales. We’ve said on numerous occasions that 70% of the economy is made up of the consumer which is a big number and is something we watch out for especially during the holiday season to see how people effect the retail sales numbers. Consumers spending money goes towards the earnings of corporations and those earnings reflect market prices. There’s a lot of strengths to focus on as we go into these last 50 days.
Football and Jobs
We’re seeing an evolving retail market right now. This year, stores have started their holiday sales 30 days in advance from where they normally start them. Black Friday is usually a big point of emphasis each year. October jobs numbers are up and crushed the estimates with 128,000 compared to 75,000. Leisure and Hospitality led the race and that was mostly due to the food and beverage industry thanks to football and tailgating. One lag you might see is manufacturing. A lot of that is due to one company going on strike. We want to point that out because a lot of people are worried about the manufacturing industry right now. Unemployment is still hovering around a 50-year low. We’re seeing a lot of people save money because more people have jobs and they’re also putting the money back into the markets. People are also starting to spend money online in advance of the holidays. It’s also important to look at the jobs number because the last two months they’ve had revisions to the initial numbers reported. These revisions added 51,000 and 44,000 accordingly which shows even more confidence.
Positive Work Force
IBD Investor’s Business Daily released its Gallup poll and basically it showed that people are less concerned than you would think about their jobs. People said that they’re not worried about their benefits being cut, their jobs being sent overseas, being laid off, or technology taking their jobs. The Gallup poll showed in one category that only 23% of people said they were worried about their benefits being cut and the other poll percentages were just as low. Those percentages are lower than they have ever been, historically.
A Newly Public Country
As full disclosure, this is not a recommendation on buying or selling but we found it interesting, so we wanted to share. This weekend Saudi Arabia announced that they’re effectively taking the country public. Saudi Aramco, the oil and gas company that produces profits in the Kingdom of Saudi Arabia, is going to go public in December. That is indicative of confidence in the markets to accept what likely will be the largest of public offering history. It’s a very diverse area but most of the money in that area comes from Saudi Aramco and they’re selling it to the market. That tells us that they’re possibly saying that they believe now is a good time to be in the market.
Fi Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. Fi Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
Economic forecasts set forth in this presentation may not develop as predicted.
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