Economic Update August 10, 2015

Phillip Allen Inc.   WEEKLY ECONOMIC UPDATE     WEEKLY QUOTE                “The greatest good you can do for another is not just share your riches, but to reveal to him his own.” – Benjamin Disraeli WEEKLY TIP               Encourage your children to start off on the right financial footing: tell them to save 10% of what they make.   WEEKLY RIDDLE              There is a 7-letter word that starts with BR and ends in G, and if you put an E in it, you get an 8-letter word that sounds the same yet has a different meaning. Name these two words.   Last week’s riddle: Simply talk about it, and you will break it. What is it?   Last week’s answer: Silence.           August 10, 2015     A GREEN LIGHT FOR A RATE HIKE? According to the latest Labor Department report, employers hired 215,000 new workers in July – 77,000 of them in professional, business, education, and health care occupations. The jobless rate held steady at 5.3% while the U-6 rate (unemployment + underemployment) ticked down to 10.4%. Monthly hiring totals have averaged 235,000 since May compared to 195,000 in Q1, and even with continued lackluster wage growth, some analysts see a stronger argument for the Federal Reserve to adjust short-term interest rates next month.1   PERSONAL SPENDING IMPROVED 0.2% IN JUNE This minor gain followed the 0.7% increase measured by the Commerce Department for May. Personal wages, however, rose 0.4% in June. A consensus MarketWatch forecast had both indicators advancing 0.3%.2      ISM SERVICE SECTOR PMI REACHES HISTORIC PEAK With 15 of 18 service fields reporting growth,...

Economic Update August 3, 2015

Phillip Allen Inc.   WEEKLY ECONOMIC UPDATE     WEEKLY QUOTE                “You gain strength, courage and confidence by every experience in which you really stop to look fear in the face.” – Eleanor Roosevelt WEEKLY TIP               Flexible spending accounts (FSA)s let you use pre-tax dollars to pay for everything from dependent care to out-of-pocket medical costs, helping you to save some money.   WEEKLY RIDDLE              Simply talk about it, and you will break it. What is it?   Last week’s riddle: They are captured by mud and snow, left behind but never taken, and rarely seen in isolation. What are they?   Last week’s answer: Footprints.           August 3, 2015     CONSUMER CONFIDENCE DIPS WITH STOCK DECLINES July brought an 8.9-point drop for the Conference Board’s consumer confidence index; it fell to 90.9. The University of Michigan’s consumer sentiment index held up better, losing 3.0 points in July to descend to a mark of 93.1.1,2   PENDING HOME SALES SLIP; PRICE INDEX TICKS UP The National Association of Realtors announced a 1.8% fall for pending home sales in June; analysts polled by MarketWatch saw a 0.6% gain. May’s S&P/Case-Shiller home price index showed an overall 4.4% yearly rise, up from 4.3% in April.1      Q2 GDP ESTIMATED AT 2.3% While the first Bureau of Economic Analysis estimate of Q2 growth fell 0.5% short of a MarketWatch consensus forecast, it bettered the 0.6% growth tallied in Q1. The Labor Department’s Employment Cost Index showed just 0.2% Q2 growth in wages and benefits, however. Headline hard goods orders rose 3.4% in June.1,2      STATUS QUO IS GOOD...