1. WORST DAY IN 2013 AND THEN –The worst day for the S&P 500 during calendar year 2013 was a 2.5% total return loss on 6/20/13. In the 1-year following the 6/20/13 tumble, the stock index gained +26.2%. The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index with each stock’s weight in the index proportionate to its market value (source: BTN Research).
2. FROM THE LOW – The bull market for the S&P 500 is in its 66th month. Since bottoming on 3/09/09 (i.e., 65 months ago), the S&P 500 has gained +220% (total return) through the close of trading last Friday 8/08/14. The average bull market for the stock index since 1950 has lasted 58 months (source: BTN Research).
3. AFFORDABLE CARE ACT – 87% of Americans that purchased their health insurance through the federal health insurance marketplace between October 2013 and April 2014 were eligible for a cost reducing subsidy that on average cut their out-of-pocket expense by 76% (source: Department of Health and Human Services).
4. BIG JUMP – The federal government reported strong +4.0% growth in the US economy during the 2nd quarter 2014 (i.e., quarter-over-quarter change expressed as an annualized number), the largest increase over the previous quarter’s result in 14 years (source: Commerce Department).
5. STILL FIRST, BUT DECLINING – Oil is the world’s leading source of energy (ahead of coal, natural gas and nuclear energy), responsible for 32.9% of global energy consumption. However, oil’s share of global energy consumption has declined each and every year for the last 14 years, i.e., 2000-2013 (source: BP Statistical Review of World Energy 2014).
6. AGING POPULATION – The percentage of the US population that is aged 65 and older is projected to grow from 14% to 21% between today and the year 2039, i.e., 25 years from now (source: Congressional Budget Office).
7. THREE TODAY, TWO TOMORROW – There were 2.8 individuals paying taxes into the Social Security system in 2013 for every 1 individual receiving retirement benefits from the Social Security system. That ratio will drop to 2.1 to 1 by 2035. The last of the “Baby Boomers” turn age 65 in 2029 (source: Social Security Trustees Report).
8. IT PAYS TO WAIT – Americans born in 1948 or later will have to work at least until age 66 (to as much as age 67 for individuals born in 1960 or later) to achieve full retirement benefits from Social Security. Once that retiree hits his/her unique full retirement age, postponing receipt of the retirement benefits will increase the payout by +8% per year (source: Social Security Administration).
9. BEST AND THE WORST – The nation’s unemployment rate was 6.2% as of the end of July 2014. The highest unemployment rate in the USA since 1947 was 10.8% in November and December 1982. The lowest unemployment rate since 1947 was 2.5% in May and June 1953 (source: Department of Labor).
10. STILL OUT-OF-WORK – The number of Americans that have been jobless at least 27 weeks has dropped 51% in the last 4 years (from 6.484 million on 7/31/10 to 3.155 million on 7/31/14), but remains +90% above where it was 6 years ago (from 1.664 million on 7/31/08 to 3.155 million on 7/31/14) (source: Department of Labor).
11. OFF TO COLLEGE – The average American family anticipates borrowing 26% of the total cost of their child’s college education, either through student loans or loans taken out by Mom and Dad (source: Sallie Mae).
12. SELF-SUFFICIENT? – Of the more than 1,000 individuals surveyed that entered college in the fall of 2008 (i.e., within weeks of the near collapse of the global financial system in September 2008), 51% need monetary assistance today to meet their current financial demands (source: APLUS Project, Joyce Serido, Ph.D.)
13. YOU’RE IN, YOU’RE OUT – The 2014 mid-term elections will take place on 11/04/14, 6 years after President Barack Obama was elected in November 2008. Democrats are hoping to avoid the performance of the Republicans in the 2006 mid-terms (i.e., 6 years after President George Bush was elected in November 2000) when the party not in control of the White House (i.e., the Democrats) picked up 30 House seats and 6 Senate seats (source: Congress).
14. OUT TO LUNCH – Congress does not return from its 5-week “August recess” until the week of 9/08/14. Their current job approval rating is 15% (source: Congress, Gallup).
15. MONEYBALL – Sergio Garcia placed 2nd at the Bridgestone Invitational in Akron, OH on 8/03/14, winning $900,000 for his runner-up finish (world’s # 1 Rory McIlroy won the tourney). Sam Snead had 82 career wins on the tour (# 1 all-time) with total career earnings of $713,155 (source: PGA).This has been provided for informational purposes only, reflects the current opinion of the author which is subject to change without notice, as are statements of financial market trends, which are based on current market conditions. Michael Higley is not affiliated with LJPR, LLC. Copyright © 2013 Michael A. Higley. All rights reserved. Reproduction Prohibited without Express Permission. Email firstname.lastname@example.org for information. The information published herein is provided for informational purposes only, and does not constitute an offer, solicitation or recommendation to sell or an offer to buy securities, investment products or investment advisory services. Nothing contained herein constitutes financial, legal, tax, or other advice. These opinions may not fit to your financial status, risk and return preferences. Investment recommendations may change and readers are urged to check with their investment adviser before making any investment decisions. Estimates of future performance are based on assumptions that may not be realized. Past performance is not necessarily indicative of future returns.