After a brief pause during inauguration week, stocks continued to climb last week. The S&P 500 added 1.03%, the NASDAQ was up 1.90%, and the MSCI EAFE increased by 1.29%. Consumer confidence matched this positive performance, as the University of Michigan Consumer Sentiment measurement beat expectations in January and reached the highest levels since 2004.[iii] However, one piece of data we received last week gave a less rosy view of the economy: initial GDP reports. What Happened: GDP Missed Projections On Friday, we received the first report on real GDP for the fourth quarter of 2016. Growth declined significantly to come in at 1.9%—down from the third quarter’s reading of 3.5%.[iv] Looking deeper Many aspects of our economy showed solid growth in the fourth quarter. Household purchases grew, business-equipment spending advanced for the first time in over a year, and inventory accumulation increased.[v] Net exports, however, pulled growth down by 1.7%—the biggest drag since 2010—as we saw a jump in imports coupled with a decline in exports.[vi] Working to increase U.S. exports is important because it can help strengthen America’s economy, support additional jobs, and promote sustainable growth. Between lagging GDP and the Dow reaching historic levels, this week showed us a range of perspectives on where the economy now stands. The markets will always have uncertainty and unanswered questions, and—as always—we must stay focused on the fundamentals that drive performance in the long term. For now, we will continue monitoring policy developments and the trade deficit to determine how they may impact economic growth in 2017 and beyond. We will also pay close attention to the economic data that gives the deep insight upon which we build our strategies for pursuing your goals. ECONOMIC CALENDAR: Monday: Personal Income and Outlays Tuesday: Consumer Confidence Wednesday: ADP Employment Report, ISM Manufacturing Index, FOMC Meeting Announcement Thursday: Productivity and Costs Friday: Employment Situation, Factory Orders, ISM Non-Manufacturing Index Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, S&P Dow Jones Indices and Treasury.gov. International performance is represented by the MSCI EAFE Index. Corporate bond performance is represented by the SPUSCIG. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. “Never bend your head. Always hold it high. Look the world straight in the eye.” – Helen Keller Sweet Potato and Red Lentil Bisque A warm dish that’s full of flavor! Serves 6 Ingredients: 1 pound sweet potatoes, peeled and roughly chopped 1 cup red lentils, sorted and rinsed 1/2 cup dried apricots, quartered 1/4 cup onion or shallots, chopped 1/4 to 1/2 teaspoon Thai red chili paste 4 cups chicken or vegetable broth 3 cups coconut milk (or light coconut milk) 1/2 teaspoon salt, plus more to taste 1/2 teaspoon ground black pepper Chopped cilantro (optional) 4 tablespoons pomegranate juice or seeds (optional) Directions: Recipe adapted from Dana Jacobi, Oprah.com[i] [i] http://www.oprah.com/food/Sweet-Potato-and-Red-Lentil-Bisque-Recipe Why to File Your Tax Return Online If you’re still filing taxes by paper, you may be creating unnecessary work for yourself. The IRS accepts electronically filed tax returns, which is the fastest and safest way to file. Here are some top reasons why the IRS suggests you e-file your tax return. Tip courtesy of IRS.gov[i] [i] https://www.irs.gov/uac/seven-reasons-taxpayers-should-efile-their-taxes-in-2017 Ripping Your Irons Hitting solid iron shots that stick close to the hole requires an ability to tear off the turf without compromising your stance or losing control of your swing. Master this skill and your score is bound to improve. These three tips can help you rip your irons with the correct stance and swing every time. Tip courtesy of Ron Kaspriske | Golf Digest[i] [i] http://www.golfdigest.com/story/3-tips-for-ripping-your-irons Prevent Lower Back Pain Lower back pain is a common ailment many people experience—and for some it’s a chronic challenge. Living with such pain can debilitate you, keeping you from your normal routines and daily lifestyle. You can develop lower back pain from actions such as: These three techniques can help you prevent lower back pain: Tip courtesy of Doctors That DO & WebMD[i] [i] http://www.webmd.com/brandcast/default.htm?prx_t=eoYCAebULA5NkLA Help the Earth and Yourself by Taking the Stairs Elevators may take us where we want to go quickly, but they usually rely on electricity to operate. This means that every single time you take the elevator, you are more than likely contributing to actions that can harm the environment. To operate electrically, the elevator may require uranium- or fossil-fuel mining, nuclear- or fossil-fuel plant operation, and greenhouse gas emissions. To minimize your pollution contributions, you can swap the elevator for stairs. In the process, you’ll also contribute to improving your health, since going up and down stairs requires physical effort. While elevator rides are usually quicker, this simple change can lessen your environmental impact and whip your body into shape (meaning you might not need the stair-climbing machine at the gym anymore!). Tip courtesy of The Nature Conservancy[1] Share the Wealth of Knowledge! If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line. Investment advisory services offered through Brookstone Capital Management, LLC (BCM), a registered investment advisor. BCM and Merlak Tax Advisory Group are independent of each other. Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Diversification does not guarantee profit nor is it guaranteed to protect assets. International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896. The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indices from Europe, Australia and Southeast Asia. The S&P U.S. Investment Grade Corporate Bond Index contains U.S.- and foreign-issued investment-grade corporate bonds denominated in U.S. dollars. The SPUSCIG launched on April 09, 2013. All information for an index prior to its Launch Date is back-tested, based on the methodology that was in effect on the Launch Date. Back-tested performance, which is hypothetical and not actual performance, is subject to inherent limitations because it reflects application of an Index methodology and selection of index constituents in hindsight. No theoretical approach can take into account all of the factors in the markets in general and the impact of decisions that might have been made during the actual operation of an index. Actual returns may differ from, and be lower than, back-tested returns. The S&P/Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate. The index is made up of measures of real estate prices in 20 cities and weighted to produce the index. The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market. Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. You cannot invest directly in an index. Consult your financial professional before making any investment decision. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors. These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative, Broker dealer or Investment Advisor, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer or Investment Advisor gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information. By clicking on these links, you will leave our server, as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site. [1] http://www.nature.org/greenliving/gogreen/everydayenvironmentalist/take-the-stairs.xml
Without net exports pulling down economic expansion, fourth-quarter GDP could have been even higher than in the third quarter. Trade is integral to our economy, and changes in the balance between imports and exports measurably effect growth. The new administration’s potential plans to tax Mexican imports, change trade relationships with China, and restrict visitors from certain countries could affect our imports and exports—and thus our economy.[vii]
Data as of 1/27/2017
1-Week
Since 1/1/17
1-Year
5-Year
10-Year
Standard & Poor’s 500
1.03%
2.50%
21.87%
14.86%
6.14%
DOW
1.34%
1.68%
26.02%
11.74%
6.09%
NASDAQ
1.90%
5.16%
26.69%
20.20%
13.24%
U.S. Corporate Bond Index
0.00%
0.16%
5.37%
3.95%
6.83%
International
1.29%
2.11%
13.29%
3.16%
-1.90%
Data as of 1/27/2017
1 mo.
6 mo.
1 yr.
5 yr.
10 yr.
Treasury Yields (CMT)
0.50%
0.62%
0.81%
1.94%
2.47%
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