It was a rough day for technology on the stock market yesterday. While the S&P 500 was little changed, the stocks in the tech sector plunged 2.7 percent and at one point was on pace for its steepest decline of the year.
The biggest names got the worst of it. Facebook dropped 3.7 percent, and Netflix fell 5.4 percent. Chip-maker Nvidia — one of the hottest heavyweight stocks this year — fell by more than 7 percent.
If there's a silver lining, it's that yesterday wasn’t the first time that tech and internet stocks suddenly plunged. In June, Apple and Amazon.com were hit for 3.9 percent and 3.2 percent one-day losses, respectively, but they rebounded nicely.
Thursday, November 30, 2017
Wednesday, November 29, 2017
Daunting Debt in Retirement
Older persons today appear more likely to enter retirement in debt than in past decades, according to a working paper from the National Bureau of Economic Research. The percentage of people age 56 to 61 arriving at retirement with debt rose from 64 percent, for those born from 1931 to 1941, to 71 percent, among those born from 1948 to 1953.
Additionally, the value of debt held rose sharply over time. While the median amount of debt in the 1931-1941 group was about $6,800, it more than quadrupled among war babies born between 1942 and 1947, and almost quintupled among the 1948-1953 group.
The paper also finds that the debt distribution appears to have changed across cohorts. In the oldest group, the top quartile of the debt distribution held around $51,000 in debt. But for the two younger cohorts, this same quartile of the population held more than double ($106,000) and almost triple ($146,800) that amount.
Additionally, the value of debt held rose sharply over time. While the median amount of debt in the 1931-1941 group was about $6,800, it more than quadrupled among war babies born between 1942 and 1947, and almost quintupled among the 1948-1953 group.
The paper also finds that the debt distribution appears to have changed across cohorts. In the oldest group, the top quartile of the debt distribution held around $51,000 in debt. But for the two younger cohorts, this same quartile of the population held more than double ($106,000) and almost triple ($146,800) that amount.
Tuesday, November 28, 2017
The Declining State of Retirement
New data reported from the journal Health Affairs suggests that older Americans have more serious health problems than they used to, making it more difficult to enjoy retirement at an increasing age. The data shows that Americans in their late 50s have more serious health issues than folks the same age did 10 to 15 years ago.
The Health Affairs article looked at survey data to compare the health of older Americans using ADL (activity of daily living) measures. ADL limitations include actions like walking across a room, self-dressing, self-bathing, feeding oneself and getting into or out of bed. The number of Americans with these limitations rose from 8.8 percent of people who have a retirement age of 65 to 12.5 percent of people at the current retirement age of 66.
The study looked at cognitive health, too. Eleven percent of Americans set to retire at 66 already showed signs of cognitive decline or dementia at age 58 to 60, which is up from 9.5 percent from Americans with a retirement age of 65 to 66.
The Health Affairs article looked at survey data to compare the health of older Americans using ADL (activity of daily living) measures. ADL limitations include actions like walking across a room, self-dressing, self-bathing, feeding oneself and getting into or out of bed. The number of Americans with these limitations rose from 8.8 percent of people who have a retirement age of 65 to 12.5 percent of people at the current retirement age of 66.
The study looked at cognitive health, too. Eleven percent of Americans set to retire at 66 already showed signs of cognitive decline or dementia at age 58 to 60, which is up from 9.5 percent from Americans with a retirement age of 65 to 66.
Monday, November 27, 2017
What's Going On with TIPS?
In a surprising development, mutual funds and exchange-traded funds targeting inflation-protected Treasurys, known as TIPS, pulled in $1.2 billion in the week ended Wednesday. That represented the largest draw since November 2016 and was the third-largest weekly inflow on record.
That burst of TIPS fund buying contrasts with recent inflation readings. The Labor Department’s consumer-price index rose 2 percent in October from a year earlier while the Fed’s preferred measure of inflation rose 1.6 percent in September from a year earlier, well below the central bank’s 2 percent target.
The 10-year break-even rate—the yield premium investors demand to hold the 10-year Treasury note relative to the 10-year TIPS—was 1.87 percent at the end of last week. That's been pretty steady over the past three months.
That burst of TIPS fund buying contrasts with recent inflation readings. The Labor Department’s consumer-price index rose 2 percent in October from a year earlier while the Fed’s preferred measure of inflation rose 1.6 percent in September from a year earlier, well below the central bank’s 2 percent target.
The 10-year break-even rate—the yield premium investors demand to hold the 10-year Treasury note relative to the 10-year TIPS—was 1.87 percent at the end of last week. That's been pretty steady over the past three months.
Friday, November 24, 2017
A Big Black Friday Weekend
The biggest shopping weekend of the year has arrived, and 69 percent of Americans — an estimated 164 million people — are planning to shop or considering shopping during Thanksgiving weekend, That's according to the annual survey released this week by the National Retail Federation.
Of those considering shopping the long holiday weekend, the survey found that 20 percent planned to shop on Thanksgiving Day (32 million), but Black Friday will remain the busiest day with 70 percent planning to shop today (115 million). A substantial 43 percent are expected to shop on Saturday (71 million), with 76 percent saying they will do so specifically to support Small Business Saturday. On Sunday, 21 percent expect to shop (35 million), and 48 percent are expected to shop on Cyber Monday (78 million).
Of those shopping, 66 percent said they’re doing so to take advantage of deals and promotions retailers will offer, while 26 percent cited the tradition of shopping over Thanksgiving weekend. Another 23 percent simply said that it’s something to do over the holiday weekend.
Of those considering shopping the long holiday weekend, the survey found that 20 percent planned to shop on Thanksgiving Day (32 million), but Black Friday will remain the busiest day with 70 percent planning to shop today (115 million). A substantial 43 percent are expected to shop on Saturday (71 million), with 76 percent saying they will do so specifically to support Small Business Saturday. On Sunday, 21 percent expect to shop (35 million), and 48 percent are expected to shop on Cyber Monday (78 million).
Of those shopping, 66 percent said they’re doing so to take advantage of deals and promotions retailers will offer, while 26 percent cited the tradition of shopping over Thanksgiving weekend. Another 23 percent simply said that it’s something to do over the holiday weekend.
Thursday, November 23, 2017
Thoughts for Thanksgiving
"Thanksgiving, after all, is a word of action." ~ W.J. Cameron
An optimist is a person who starts a new diet on Thanksgiving Day. ~ Irv Kupcinet
"The unthankful heart discovers no mercies; but the thankful heart will find, in every hour, some heavenly blessings." ~ Henry Ward Beecher
An optimist is a person who starts a new diet on Thanksgiving Day. ~ Irv Kupcinet
"The unthankful heart discovers no mercies; but the thankful heart will find, in every hour, some heavenly blessings." ~ Henry Ward Beecher
Wednesday, November 22, 2017
Thanksgiving Spending
Between buying the turkey and stuffing, travel costs, and finding just the right bottle of wine, Thanksgiving is getting to be an expensive holiday. A new survey from LendEDU finds that the average American will spend a total of $165.14 this year on Thanksgiving expenses.
Travel makes up a sizable part of that, but it’s not the majority. The site, which surveyed 1,000 people about their expected costs, says travel expenses make up $67.59 of that amount, with the rest going for food, wine, and other expenses.
The real winners at this time of the year are the nation’s turkey farmers. LendEDU calculates there are 254 million turkeys raised in the U.S. each year, with a total value of $4.85 billion - and 36 million of those turkeys are eaten at Thanksgiving.
Travel makes up a sizable part of that, but it’s not the majority. The site, which surveyed 1,000 people about their expected costs, says travel expenses make up $67.59 of that amount, with the rest going for food, wine, and other expenses.
The real winners at this time of the year are the nation’s turkey farmers. LendEDU calculates there are 254 million turkeys raised in the U.S. each year, with a total value of $4.85 billion - and 36 million of those turkeys are eaten at Thanksgiving.
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