Economic Update, October 16, 2017

  Phillip Allen Inc.   WEEKLY ECONOMIC UPDATE     WEEKLY QUOTE                “The ordinary acts we practice every day at home are of more importance to the soul than their simplicity might suggest.” – Thomas Moore WEEKLY TIP               If you are past 50 and you worry that your retirement savings are insufficient, the best financial response may be to work longer. Even working part time for a few more years could lessen the need to draw down your retirement money. WEEKLY RIDDLE              A Saab travels along an avenue at 50mph; a Subaru, at 30mph. The Subaru passes by the Saab, without speeding up to do so. How is this possible?         Last week’s riddle: Christine wants to know how far she can hike into a rugged badlands that is 6 miles wide. How far can she possibly go into the badlands?      Last week’s answer: 3 miles. If she hikes in any further, she will actually begin to hike out.           October 16, 2017     RETAIL SALES, SENTIMENT NUMBERS IMPRESS Two economic indicators stood out last week. Retail purchases rose 1.6% during September as households and businesses replaced cars and trucks damaged in hurricanes. This was the best monthly advance recorded by the Department of Commerce since March 2015, and the gain was 1.0% even with auto buying removed. The University of Michigan’s initial October consumer sentiment index displayed a reading of 101.1, which was nearly a 14-year high. Economists polled by Briefing.com had forecast just a half-point improvement to 95.6.1,2   GAS PRICES DRIVE UP INFLATION A 13.1% spike in retail gasoline costs accounted...

Economic Update, October 9, 2017

  Phillip Allen Inc.   WEEKLY ECONOMIC UPDATE     “Never let the future disturb you. You will meet it, if you have to, with the same weapons of reason which today arm you against the present.” – Marcus Aurelius WEEKLY TIP Your household may want to budget by the 50/20/30 rule: 50% of take-home pay assigned to fixed monthly costs, 20% to saving/investing, and 30% to flexible consumer expenses. WEEKLY RIDDLE Christine wants to know how far she can hike into a rugged badlands that is 6 miles wide. How far can she possibly go into the badlands? Last week’s riddle: Michael is asked to use only the numeral 4 four times to make an equation that equals 17. How does he do it? Last week’s answer: [4 ÷ 4] + [4 x 4] = 17.           October 9, 2017     HURRICANES HURT SEPTEMBER JOB NUMBERS For the first time in seven years, the economy went a month without payroll growth. The Department of Labor’s September employment report revealed the impact of Hurricanes Harvey and Irma: it showed 33,000 fewer people working. Average hourly wages rose 0.5% to take the annualized gain to 2.9%, but this may have been an effect of the net loss of 105,000 lower-paying bar and restaurant jobs. In a statistical fluke, the headline jobless rate fell to 4.2%, and the U-6 rate, counting the underemployed, declined to 8.3%, even as slightly more Americans looked for work.1 ISM FACTORY PMI TOPS 60 Rising 2.0 points for September, the Institute for Supply Management’s factory purchasing manager index hit 60.8, its best mark since May 2004. ISM’s service...

Economic Update, October 1, 2017

Untitled Document Phillip Allen Inc.   WEEKLY ECONOMIC UPDATE     WEEKLY QUOTE                “A man’s silence is wonderful to listen to.” – Thomas Hardy WEEKLY TIP               When a grandparent, relative or friend of the family pays for a child’s medical expenses that are not covered by insurance, direct payments to doctors for such costs are not considered gifts to the child and do not count against the annual gift tax exclusion amount (currently $14,000). WEEKLY RIDDLE              Michael is asked to use only the numeral 4, four times, to make an equation that equals 17. How does he do it?         Last week’s riddle: A 6-foot chain is suspended with its ends nailed to a wall, with the nails parallel to the floor. The chain sags and hangs down between the nails; the height of the hanging chain is therefore 3 feet from top to bottom. What is the distance in between the nails?      Last week’s answer: No distance at all, they are next to each other.           October 2, 2017     PERSONAL SPENDING BARELY IMPROVES Consumer spending increased by only a seasonally adjusted 0.1% in August, while consumer incomes rose 0.2%. Those gains precisely matched the projections of economists surveyed by the Wall Street Journal. Factoring in inflation, household spending actually retreated 0.1% during August. Hurricane Harvey may be partly to blame for these numbers.1   ROUNDING UP REAL ESTATE INDICATORS Census Bureau data shows new home buying down 3.4% in August; this dip comes on the heels of a (revised) 5.5% fall in July. Pending home sales, as measured by a National Association...

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