#231 Timber Up, Dollar Down

Timber Up

Lumber prices are through the roof. If this trend continues it could cause the housing market, a major component of our growth, to slow down. The wildfires in Canada are currently wiping lumber supply out. In addition to that, the U.S. & Canada are in a bit of a “trade war” over lumber. These two components can cause housing prices to go up.

Dollar Down

The dollar has hit a 24 month low against the European Union, Euro currency. Although this can sound bad, it actually can be good for U.S. Companies. Over 40% of U.S. company earnings come from overseas. If you have a weaker dollar, that allows the oversea sales to translate into higher domestic earnings. This could lead into a temporary boost in the already strong earning season. Now, what we have seen in the past is that the weakness of the dollar can lead to oil prices shooting up because it takes more dollars to buy the same barrel of oil. However, because of the innovation of the U.S. oil industry, we have seen oil prices not just stay still but continue to fall during the dollar weakness. So, we are starting to see benefits for both companies and the consumer.


We have a very important GDP report coming out on Friday. That’s important because this morning the International Monetary Fund downgraded the U.S. growth forecast for this year and the next. We really need the GDP number to come in strong. Expectations are around 3%. The first quarter of GDP was 1.4%, which is slow growth. For a healthy growing economy it’s ideal to have a 3%-3.5% GDP. Housing and manufacturing has continued to be strong. The consumer spending has been down for 2 months in a row. The consumer is 70% of that GDP number. This will be something to look at come Friday.

Greg Powell, CIMA®
President and CEO
Wealth Consultant
Email Greg Powell here

Bobby Norman, CFP®, AIF®
Senior Vice President
Wealth Consultant
Email Bobby Norman here

Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant
Email Ashley Page here

Trey Booth, CFA®, AIF®
Senior Vice President
Wealth Consultant
Email Trey Booth here

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.

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