Economic Update, September 26, 2016

Phillip Allen Inc.   WEEKLY ECONOMIC UPDATE     WEEKLY QUOTE                “Learning is not attained by chance. It must be sought for with ardor and attended to with diligence.” – Abigail Adams WEEKLY TIP               By tracking a company’s typical month-to-month sales cycle, a business owner can identify when to put money into reserve to see a business through leaner months on the way to boom times. WEEKLY RIDDLE              How can you take three toothpicks and make them into the number nine?       Last week’s riddle: I am soft and seldom upright. I lose a head in the morning, but I get it back at night. What am I?   Last week’s answer: A pillow.           September 26, 2016     FED WAITS TO RAISE INTEREST RATES Federal Reserve officials decided against a rate hike last week, but two details in the central bank’s latest policy statement suggested an upward move was near. One, the Federal Open Market Committee voted 7-3 against raising the federal funds rate – an unusually close margin. Two, the Fed’s new dot-plot forecast showed consensus for a rate increase before the end of 2016. “Our decision [to wait] does not reflect a lack of confidence in the economy,” Fed chair Janet Yellen told the media after the announcement. “We’re generally pleased with how the U.S. economy is doing.”1      FEWER HOUSING STARTS, LESS HOMEBUYING August saw existing home sales dip 0.9%; as the National Association of Realtors delivered that news, it also revised its July sales calculation to a decline of 3.4%. A Census Bureau report showed housing starts falling 5.8% last...