1. NINE YEARS – In the first 3-years following its 3/09/09 bear market closing low of 677, the S&P 500 gained +114% through 3/09/12 (i.e., total return result including the impact of reinvested dividends). In years 4-9 (i.e., the next 6 years) from 3/09/12 to last Friday 3/02/18), the S&P 500 has gained an additional +125%. 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. NOT ALWAYS UP – The nearly 9-year bull market run for the S&P 500 that began on the morning of 3/10/09 has gained +381% (total return) through last Friday 3/02/18, an annualized return of +19.1% per year. During the entire 9 years, the index has had 5 separate “corrections” of at least 10%but less than 20%. The ending dates of the 5 “corrections” are 7/02/10, 10/03/11, 8/25/15, 2/11/16 and 2/08/18 (source: BTN Research).
  3. BAD CALL – The S&P 500 bottomed at 677 on 3/09/09, the end of a 17-month bear market in which the stock index fell 57%. A weekly survey of stock investors indicated 70% of them were bearish as of 3/04/09, the highest bearish measurement ever recorded by this study (source: American Association of Individual Investors).
  4. LONG TIME – The USA has kept records on economic expansions and contractions since 1854. The current expansion, which began in July 2009, is in its 105th month. It is the 3rd longest expansion in history, trailing only expansions that ran from 1991-2001 and from 1961-69 (source: National Bureau of Economic Research).
  5. IS A TRADE WAR NEXT? – President Trump announced plans on Thursday 3/01/18 to have the USA impose tariffs of 25%on steel imports and tariffs of 10% on aluminum imports for an undefined period. The tariff order could be signed into law this week. 17 million Americans are employed today by steel-using businesses, e.g., the automobile industry and the construction industry (source: National Tooling and Machining Association).
  6. VERY RICH PLAN – Defined benefit pension plans can be funded to produce an annual benefit at retirement as high as $220,000 in 2018, up from $185,000 in 2008 (source: Internal Revenue Service).
  7. SAVING  – 51% of pre-retirees say that their efforts to save for retirement are “behind schedule” while only 15% of preretirees are “ahead of schedule” (source: Society of Actuaries Risks and Process of Retirement Survey).
  8. PARTICIPATION – If the USA had 4 unemployed people for every 100 individuals either working or seeking work, the nation’s unemployment rate would be 4%, i.e., 4 divided by 100 (note the nation’s actual jobless rate was 4.1% as of 1/31/18). People who have given up looking for work are not counted in the unemployment calculation. Counting 1 additional out-of-work person who is no longer looking for work, the new math would be 5 divided by 101, resulting in a 5.0% national unemployment rate (source: BTN Research).
  9. COLLEGE COSTS  – The cost of tuition, fees, room and board at an average in-state public college has increased +5.5% per year over the last 30 years, reaching $20,770 for the 2017-2018 school year. If college costs had instead risen only by the rate of inflation (using the CPI) over the last 30 years (+2.6%per year), then a year of college would cost $9,012 during the current
    school year. The consumer price index (CPI) is a measure of inflation compiled by the US Bureau of Labor Studies (source: College Board, Department of Labor).
  10. BORROWING EACH WEEK  – Through the first 2 months of 2018 (i.e., through 2/28/18), the Treasury Department has conducted weekly auctions in which they have borrowed $1.43 trillion. The duration of the debt ranges from 4 weeks to 30 years (source: Treasury Department).
  11. SIMPLER RETURN – Only 19.3 million US taxpayers are expected to claim itemized deductions in tax year 2018, down from an estimated 46.5 million itemizers from tax year 2017, a result of the 2018 limitation on “state and local taxes” and a doubling of the standard deduction (source: Tax Policy Center).
  12. IMPROVING TREND – American banks repossessed 292,000 homes in 2017, 379,000 homes in 2016 and 450,000 homes in 2015 (source: ATTOM Data Solutions).
  13. SAME HOUSE AFTER SIXTY YEARS – Warren Buffett lives in the same home today in Omaha, NE that he purchased for $31,500 in 1958. Buffett, 87 years old, is worth $78 billion (source: Forbes).
  14. MAESTRO – Former Fed Chairman Alan Greenspan turns 92 years old tomorrow (3/06/18). Greenspan was the Fed’s Chairman for 18 ½ years beginning 8/11/87 through 1/31/06 (source: Federal Reserve).
  15. BACK-TO-BACK – The 2000 New York Yankees professional baseball team was the last major league team to repeat as World Series champs, a feat the Houston Astros will try duplicate in 2018 (source: MLB).

IMPORTANT DISCLOSURE: The information contained in this material has been prepared for informational purposes only and does not constitute investment advice. Any mention of particular stocks or companies does not constitute and should not be considered an investment recommendation. Past performance is not a guarantee of future results. Any forward-looking statements presented in this material are inherently uncertain and cannot be relied upon as statements of actual performance.

Reproduction Prohibited without Express Permission – Copyright © 2018 Michael A. Higley. All rights reserved.