April 3, 2017

Weekly Market Commentary
April 3, 2017

The Markets

Happy Spring everyone! The market had a solid 1st quarter this year and for clients who had a large bond positions I made edits to move portions to stocks and it was very successful. The earnings reports so far have been solid which is also good news for the market.

The Federal Reserve acted
With employment and inflation data approaching Fed targets, the Federal Open Market Committee raised rates in March, pushing the Fed funds target rate into the 0.75 percent to 1 percent range, reported Financial Times. More rate hikes are expected during 2017.

Brexit was launched
The end of the first quarter of 2017 marked a new beginning for Britain. On March 29, Prime Minister Theresa May officially launched Britain’s exit from the European Union. The United Kingdom now has two years to negotiate terms with the European Union (unless all members of the EU unanimously approve an extension).

When you consider how long trade agreement negotiations normally take, it appears the task ahead for Britain and the EU is akin to running a marathon in 30 minutes. For example, Canada and the EU began discussing a trade agreement in 2007. It has yet to be finalized.

The United States and European national stock market indices just moved past this moment unlike when it was announced last year and finished the quarter higher.

THE TOOTH FAIRY IS AWFULLY GENEROUS THESE DAYS. Since 1998, an insurance firm has conducted a poll to determine how much swag the tooth fairy or, depending on your country, the magical mouse, elf, brownie, or tooth rat has been leaving behind for children who’ve lost their teeth.

When the poll began, the going rate for a tooth was about $1.50. The most recent survey found that, in the United States, a tooth was pulling in about $4.66! The going rate in other nations was similar:

• C$6.11 in Canada ($4.59 U.S.)
• ¥525.82 in Japan ($4.72 U.S.)
• €4.38 in Ireland and Spain ($4.67 U.S.)
• £3.75 in England ($4.70 U.S.)
• R$14.47 in Brazil ($4.63 U.S.)
• ₡2613.42 in Costa Rica ($4.66 U.S.)

NPR’s Planet Money examined whether the value of lost teeth has kept pace with inflation. They posited a tooth was worth about $0.50 in the 1970s. If the value of a tooth had risen with inflation, it would be worth less than $3.00 today. So, the value of a lost tooth has increased faster than the rate of inflation – similar to college tuition!

Weekly Focus

“The secret of a good sermon is to have a good beginning and a good ending: and to have the two as close together as possible” -George Burns

Recent comments