Why Do We Worry So Much?

Americans sure do worry about their finances. According to a new survey from the mutual fund firm Legg Mason, investors say they devote an hour and 20 minutes to their financial worries every single day. That's a total of 475 hours a year.

That's just the average. Legg Mason also found a hardcore group, about 10 percent of all investors, who spend two to three hours each day thinking or worrying about money. That's close to a thousand hours a year, or 125 eight-hour workdays, all spent fretting over finances.

What are all these people worrying about? Six out of 10 said they were not confident or only “somewhat confident” about their ability to retire “at the age I want to.” It sounds like they should spend less time worrying and more time taking control of their retirement plans.

Happy Anniversary, Bull!

It was on March 9, 2009 - exactly six years ago today - that the stock markets bottomed out following the financial crisis, and the bull market began. That remarkable run continues to this very day.

Here's what has happened in the past six years:

• The S&P 500 has risen by 205 percent - more than tripling in value
• The Dow Jones Industrial Average has risen by 174 percent
• The Nasdaq is up an astonishing 288 percent
• Citigroup, which had one of the biggest collapses during the financial meltdown, has seen its stock rise by 405 percent
• Apple stock is up an incredible 966 percent

February's Jobs Report

We've had a strong of very strong months in the labor market, but somehow the news just keeps getting better. February's employment figures, released by the Bureau of Labor Statistics this morning, show that the economy added 295,000 jobs on the month. The headline unemployment rate dropped to 5.5 percent - the lowest it's been since May 2008. That's despite the fact that our terrible weather in February was expected by many to put the brakes on the hiring process.

We've had a a full year now with increases of at least 200,000 jobs per month. That hadn't happened since the go-go Nineties boom, in 1994-95. Over the past 12 months, we've seen an average monthly gain of 266,000 jobs. 

The stats on the quality of employment in February were mixed. The biggest single category adding jobs in February was food services and drinking places, with 59,000, and those are generally low-wage jobs. But the next-most was professional and business services at 51,000, and those are usually higher-paying, higher-prestige positions.

The Impact of Buybacks

According to data compiled by Birinyi Associates, stock buyback authorizations set a new record in February, at a total of $118.32 billion. That’s the most since TrimTabs Investment Research began tracking that data in 1995, and almost twice the $55 billion bought in February of 2014.

Stock buybacks have been growing ever since the bull market started back in 2009: Companies bought back $2.1 trillion of their own stock between 2009 and the third quarter of 2014. In the first three quarters of 2014 alone, corporate buybacks rose by 27 percent, to $567.2 billion, and Apple alone bought $17 billion of its own stock.

These buybacks have had a significant impact on the movements of the market. According to a study from Bloomberg, there has recently been roughly $5 billion in buybacks each trading day - accounting for fully 2 percent of the total trading volume.

The IRS Holds Its Fire

Most of us are in the middle of tax-filing season, but there might be a little less pressure on taxpayers this year. The chances of an audit are declining quickly: The IRS said last week that it audited 0.86 percent of individual taxpayers in fiscal year 2014, the lowest rate since 2004.

It's even better if you're a small business owner. The IRS audited 0.57 percent of businesses in 2014, their lowest rate of business audits since 2005. The agency conducted 57,211 business audits in the fiscal year that ended September 30, down from 61,020 a year earlier.

The IRS focuses most of its firepower on bigger companies, but even in that area, the audits are being reeled back. In 2014, the IRS audited 26 percent of corporations with assets exceeding $250 million, down from 34 percent a year earlier.

The Nasdaq Scales the Heights

The Nasdaq stock index reached 5000 yesterday, for only the third time in its history. The first time was on March 9, 2000, in the midst of the high-tech boom; the second time was the very next day, when it closed at an all-time high of 5048. Yesterday, finally, it reached 5000 for a third time, nearly 15 years later.

The S&P 500 and the Dow Jones average both created all-time highs in early 2000 as well, but they have beaten those records several times since. Both of those indexes were back to new records in 2007, before the Great Recession took hold.

The Nasdaq never made it that high again, not for 15 long years. That's not quite a record span between highs for a stock index; the Dow and S&P each took 25 years to regain the heights of the 1929 boom that ended on Black Friday on October of that year. But 15 years is still a long time.

Why Revenues Are Weakening

Despite signs of a generally humming economy, there is one weakness we're seeing: corporate revenue growth. Among the companies in the S&P 500, revenue growth dropped from 3.6 percent in the third quarter of 2014 to 3.1 percent in the fourth quarter. S&P Capital IQ forecasts that revenue growth falling to negative 0.6 percent in the first quarter of this year, and negative 0.9 percent in the second quarter.

Why are profits dropping? There are two basic factors behind this:

• This is the downside of the slide in energy prices that has made so many of us happy at the gas pump. Revenue for energy companies have been dropping as well. The energy sector has seen its earnings drop by 22 percent in the past year.
• The stronger dollar has driven down profits that companies derive from overseas. Nearly half the total revenue for the S&P 500 comes from outside the United States.