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February 27, 2017

The S&P 500 continued its hot streak last week, closing at yet another all-time closing high on Friday (2/24/17), the 3rd consecutive trading week that has ended with a record close.  With 2 trading days remaining in February, the index is up +6.1% YTD (total return), well above its average 1st quarter gain of +1.6% that has been achieved over the last 25 years (1992-2016).  The month of February has produced just 3 down days for the S&P 500.  The split between “up-to-down” trading days is 65/35 YTD, outpacing the 53/47 split maintained over the last 50 years (source: BTN Research).

Treasury Secretary Steven Mnuchin predicted last Thursday (2/23/17) that the administration’s goal of a +3% annual GDP growth rate was “very achievable” but that it may take until the end of 2018 for the country to reach that level.  Over the last 11 years (2006-16), the US economy has grown at a meager +1.4% per year, half of the USA’s +2.8% growth rate produced over the last half century (1967-2016).  Individual and corporate tax reform, integral to faster growth in our economy, now has an August 2017 target date from the White House (source: Commerce Department).

President Donald Trump will deliver a prime time address to a joint session of Congress tomorrow night (2/28/17), his first opportunity to speak before them.  58 members of the 535-member Congress (11%) are new to Washington this year (source: BTN Research).

Notable Numbers

IT REALLY ALL DEPENDS – An individual with $1 million invested 100% in the S&P 500 as of 1/01/73 withdrawing an inflation-adjusted $100,000 per year would be out of money in 9 years.  A second individual with $1 million invested in the S&P 500 as of 1/01/82 withdrawing an inflation-adjusted $100,000 per year would have $4.46 million remaining after 35 years, i.e., as of 12/31/16.  This calculation ignores the ultimate impact of taxes on the account which are due upon withdrawal, is for illustrative purposes only and is not intended to reflect any specific investment or performance.  Actual results will fluctuate with market conditions and will vary (source: BTN Research).

IN THE RED IN FEBRUARY – The last time that the month of February did not produce the largest monthly deficit in any fiscal year was 2002 (i.e., the 12-month period from 10/01/01 to 9/30/02) or 15 years ago (source: Treasury Department).

DO I REALLY NEED IT? – Only 36% of all jobs in the United States require education beyond high school, i.e., 64% of American jobs require a high school diploma or less.  27% of jobs do not require any formal educational credential (source: Department of Labor).

CROSS YOUR FINGERS – 28% of our nation’s 612,079 bridges are at least 50 years old and have never received any major reconstruction work (source: American Road and Transportation Builders Association).

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