MidSouth Week in Review:
January 03, 2020

The S&P was down 0.2% for the holiday shortened week.  Yesterday the S&P was up 0.8% and the tech stocks rose around 2% as new investment dollars came into the market to start the new year.  Today the S&P declined 0.7% and oil prices surged after a U.S. airstrike killed an Iranian general in Iraq.  Crude Oil hit an 8-month high of $65 before closing at $63.  U.S. home prices rose 2.2% in October to a 5-month high.  The 10-year Treasury closed out 2019 with a yield of 1.9%, its lowest year-end close in seven years.  The S&P was up 190% for the decade.  Tech stocks rose nearly 50% in 2019.

BuzzBits

The S&P - was up 28.9% in 2019. After a 25%+ yearly gain, the S&P has averaged being higher 67% of the time with an average gain of 6% - Wall St. Journal

Exercise – “I get my exercise acting as a pallbearer to my friends who exercised.”  - Chauncey Depew, CEO of the New York Central Railroad, who died at age 94 in 1928

Stock Market Forecasts – It is the time of year for predictions and I’ll make one:  You will be better off ignoring the stock-market predictions for 2020.  Going back to 2000, the median forecast was that stocks would rise 9.8% vs. the mere 5.5% that the S & P averaged rising over the 20-year period – Jeff Sommer, New York Times...  Goldman Sachs expects the S&P to rise 5.2% in 2020

Auld Lang Syne – was a poem written in 1788 by Scottish poet Robert Burns.  Singing the song on Hogmanay or New Year’s Eve very quickly became a Scots custom that soon spread to other parts of the British Isles.  As Scots (not to mention English, Welsh and Irish people) emigrated around the world, they took the song with them – Wikipedia

The Stock Market – always does what it has to do to make the majority wrong – Laurence J. Peter

Bad Math – Home cash-out refinancing frees up money homeowners can use to pay down credit card debt, renovate or invest in new property.  Unfortunately, 60% of the 2018 re-fi’s came with higher interest rates with this year’s number falling to 44% - Wall Street Journal

$103,150 – is the amount that a married couple could earn and have no Federal tax bill.  The standard deduction for a married couple is $24,400 in 2019, and the top of the 0% capital-gains tax bracket is $78,750, for a total income of $103,150 without a tax bill.  Those who aren’t married should halve these amounts.  The IRS is increasing these amounts slightly in 2020 – Wealth Management

Re-election Odds – An incumbent President has not lost re-election since 1900 when the economy had not gone into a recession in the two years prior to the election – former Senate Majority Leader Bill Frist

Retirement Costs – for a 65-year-old couple retiring this year will be around $285,000 for health costs, assuming they don’t have any retiree health coverage from a former employer – Fidelity

Global Warming – The 20 warmest years have all come in the past 22 years – New York Times

Oil – The S & P 1500 Energy Index has risen at an annualized rate of 2.5% for the decade.  That makes some sense (buying) considering the price of oil started the decade at around $80 per barrel, peaked at $112 in 2011, crashed into the high $20 range in 2016, and now sits at around $60 – Barron’s

Ouch! – When Gloria Vanderbilt, a descendent of tycoon Cornelius Vanderbilt died, her estate was reported to be worth $200 million, which probably had her son, CNN news anchor Anderson Cooper, drooling.  However, her net worth was a bit exaggerated because Cooper looks to now be receiving less than $1.5 million from his mom’s estate – Wealth Management

The 5-Year Drought – in California has killed an estimated 130 million trees which would represent about 13 dead trees for every family of four – Wall Street Journal

Charitable Giving – has declined by twenty million people from 2000 to 2016.  65% of Americans made charitable donations in 2008 vs. only 53% in 2016.  Donations as a percentage of median family worth in 2016:  White (2%), Asian (4%), Hispanic (5%), Black (8%).  Share of general population giving:  Hispanic (33%), Black (34%), White (58%), Asian (59%).  Share of high-net-worth households giving:  Black (92%), White (90%), Hispanic (88%), Asian (84%) – Urban-Brookings Tax Policy Center

Female Board Members – California passed a law last month that requires every public company to have at least one female board member or face a one-time fine of $100,000.  By 2021, the state will require every company with at least five board members, to have at least two female directors or face a $300,000 penalty for every seat that should be filled.  In the U.S., women hold about 20% of board seats of Russell 3000 companies – New York Times

buzz@msifund.com

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