Despite December Turbulence, Economy And Business Optimism Were Strong
Published Friday, January 18, 2019 at: 7:00 AM EST
While the stock market plunged in December and headlines turned grim, small business owners overwhelmingly remained optimistic about the economy and business conditions.
The National Federation of Small Business Optimism Index remained basically unchanged in December, drifting down by just four-tenths of 1%, to 104.4, amid the worst December since 1931.
Stocks lost 14% of their value in the fourth quarter and it was the worst quarterly loss since 2011. The Fed was sticking with its plan to hike rates, the political crisis in Washington was making new headlines daily, a trade war with China loomed, and uncertainty blemished Europe's economic growth outlook.
Nonetheless, in the week ended January 12th, the Department of Labor's advance figure for seasonally adjusted initial claims for unemployment was 213,000, a decrease of 3,000 from the previous week's unrevised level of 216,000. The four-week moving average was 220,750, a decrease of 1,000 from the previous week's unrevised average of 221,750.
On the heels of last week's stronger than expected job-creation report for December, this reinforces a strong employment situation, and jobs fuel personal income of America's consumer economy.
The Standard & Poor's 500 — a key growth engine in a broadly diversified portfolio — closed on Friday at 2,670.71, compared with 2,596.26 a week earlier, extending a rebound from the 19.8% plunge from September 20th's all-time closing high to the Christmas Eve closing low of 2,351.10.
Please let us know if you would like a report summarizing the 4Q2018 financial and economic conditions.
This article was written by a veteran financial journalist based on data compiled and analyzed by independent economist, Fritz Meyer. While these are sources we believe to be reliable, the information is not intended to be used as financial or tax advice without consulting a professional about your personal situation. Tax laws are subject to change. Indices are unmanaged and not available for direct investment. Investments with higher return potential carry greater risk for loss. Past performance is not an indicator of your future results.
This article was written by a professional financial journalist for Derand Capital Management Group and is not intended as legal or investment advice.
Here’s what happened in the economy this past week affecting investors:
The Federal Reserve said the recovery was making progress and is holding its course .
The economy grew at a 6.5% annual rate for the quarter ended June 30th.
Inflation persisted at the highest level in years .
Disposable income, personal savings and consumer spending. reverted closer to their historical levels but remained extremely strong
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Securities and advisory services offered through The Strategic Financial Alliance, Inc. (SFA), member FINRA and SIPC. mel r. hertz is a registered representative and an investment adviser representative of SFA, which is otherwise unaffiliated with Derand Capital Management Group.
We are registered to sell Securities in the following states: Arizona, California, Colorado, Florida, Hawaii, Louisiana, Maryland, Massachusetts, Michigan, North Carolina, New Mexico, Nevada, Ohio, Oregon, Texas, Washington.