POCKETBOOK: Week ending August 18, 2017

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  • No, he’s not a brilliant money manager

I had lunch recently with a guy who was thanking the president for the wonderful stock market returns he has realized in his portfolios. He claimed the value of his investments had soared and all was due to President Trump.

To figure that the new president is what has caused this stock market to soar, dear readers, has a bit of poppycock in it. Why? Because we’ve been privy to a bull market for the past nine years thanks to an assortment of economic recovery conditions that have resulted in terrific returns for investors.

Here are the numbers: On March 6, 2009, the DJIA hit a new low of 6,443.27. On November 8, 2016, the date Trump was elected president, the DJIA closed at 18,332.74, according to BusinessInsider.com.

The DJIA closed last Friday at 21,674.51.

While there is no denying the roughly 3,340 point increase in that index, to give all of the credit for our current bull market returns to President Trump would be at best, not looking at the whole picture.

 

  • Market Quick Glance

Drip. Drip. Drip.

A skilled handyman, or handylady, will tell you that it’s a slow and steady drip that does the most damage to your drywall because until all hell breaks loose, no one notices what’s been going on or for how long it’s been happening.

Not saying that all hell breaking loose is gonna happen to the markets here, but I am pointing out that over the recent short-term, year-to-date returns and 1-year returns for the four indices followed here have been falling. Slowly. Drip by drip.

Perhaps the most noticeable is that of the Russell 2000—year-to-date that index is pretty much flat (0.05%).

Investors would be wise to take a look at all of the holdings in their portfolios—including those in retirement accounts. The purpose of doing so would be two-fold. First to reconnect with what you own. The second to consider if any changes ought be made, assets reallocated or money taken off the table and spent on something you’d really like to buy.

Below are the weekly and 1-year index performance results— including the dates each reached new highs— according to data from CNBC.com. Data is based on prices at the close of business for the week ending on Friday, Aug. 18,  2017.

 

-DJIA + 9.67% YTD down from last week’s +10.60% and the previous week’s 11.79%.

  • 1 yr Rtn +16.54% down from last week’s 17.43% and the previous week’s down 20.38%.

 

The DJIA reached another new all-time high on August 8, 2017 of 22,179.11

(Previous highs since March include: August 4, 2017 of 22,092.81; 21,841.18 on July 28, 2017; July 14, 2017 of 21,681.53; July 3,2017 of 21,562.75; 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +8.34% YTD down from last week’s 9.04% and the previous week’s 10.63%.

  • 1yr Rtn +10.91% down considerably from last week’s +11.69% snf the previous week’s 14.44%.

The S&P 500 reached a new all-time high on August 8, 2017 of 2,490.87.

(Previous high of 2,484.04 was reached on July 27, 2017 and 2,477.62 was reached on July 20, 2017. Prior to that date new highs and dates include: 2,463.54 on July 14, 2017; 2453.82 on June 19,2017; 2,446.2 reached on June 9, 2017; 2,440.23 reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +15.48% YTD down from last week’s +16.23% and the previous week’s 17.99%.

  • 1yr Rtn +18.63% down considerably from last week’s 19.66% and the previous week’s 22.94%.

 

The Nasdaq reached a new all-time high of 6,460.84 on July 27, 2017.

(Previous highs include: July 20, 2017 of 6,398.26; 6,341.7 on June 9, 2017; 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +0.05% YTD down considerably from last week’s +1.26% and the previous week’s 4.07%.

  • 1yr Rtn +9.78% down a lot from last week’s +11.81 and the previous week’s 16.36%.

 

The Russell 2000 reached its latest all-time high on July 25, 2017 of 1,452.09.

(Previous highs include: 1,452.05 on July 21, 2017; 1,433.789 on June 9, 2017; 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

 

-Mutual funds

More drips.

The average cumulative total reinvested returns for equity funds on Thursday, August 17, 2017 was 6.73%. That’s lower than the previous week’s close of 7.05%, the close of the week previous to it of 8.93% and the one before it of 9.59% and the one before it of 9.84%.

See the trend? Could it be a long-lasting trend? Or the beginning of a correction? Or a bull market?

Time will tell.

In the whole wide world, World Equity Funds continue to reward their investors the most. They were up, on average, 18.07%—up from the previous week’s close of 17.76%. India Region Funds are still leading the way under that heading, up year-to-datw an average of 29.89%.

Even World Income Funds, up on average 7.58%, have returned more than the average U.S. Diversified Equity Funds.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • Thought for the week

“A prosperous fool is a grievous burden”

-Aeschylus, playwright

 

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pbTrumpBits#14: Fake News

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Important: Dear Reader: This is an almost totally FAKE NEWS  entry with one factual news exception. That exception: So far, 18 organizations have decided NOT to hold their fundraising galas at Mar-a-Lago during the upcoming season because of the president’s handling of Charlottesville, VA. marches. FYI: Three of those organizations include the Cleveland Clinic, the American Cancer Society and the American Friends of Magen David Adom.  A link to a more detailed list is at the end of this blog.

Now, on to the FAKE NEWS:

With charitable organizations dropping like flies and deciding NOT to hold their fundraising galas at Trump’s Winter White House Mar-a-Lago Private Club because of his responses regarding the marches in Charlottesville, Va., whispers are that the joint is for sale.

One source, not willing to be identified, said: ” Trump is all about money and once the money starts drying up he gets out of whatever project he’s involved with. Then he seems to have a history of selling out and suing all  parties involved to cover his losses.”

A concerned member of the club, also not willing to be identified,  worries membership fees may be doubled to cover a drop in gala income. And,  that the club will lose its international flare by hiring only U.S. citizen staff and employees.

No word yet on what the price tag might be, but another anonymous source speculated that the likely buyer could be a Russian.

Dear Reader: Again, the story above is FAKE NEWS entry . Got it.

Not fake news: Click here to learn more about the organizations that won’t be partying at Mar-a-Lago this season: http://www.palmbeachdailynews.com/news/local-govt–politics/keeping-track-home-here-list-who-leaving-mar-lago/Cq9HrDBsT1YB8A9EF6OijP/

POCKETBOOK: Week ending August 11, 2017

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•August Heat

Every day is a new day on Wall Street, Main Street and Pennsylvania Avenue. What happens from the latter, however, impact all streets across America as well as all of the lives of those residing on them. So, the heat is on.

Re the markets, while we are only half way through the month, if history is any guide the Stock Trader’s Almanac reports that August is the 10th worst performing month for the Dow and 11th worst for the S&P500 and NASDAQ.

On the bright side, historically there have been a few more up August months than there have been down ones: Over the last 67 years, the month has closed up 37 times and 30 down ones for the Dow and S&P.

 

  • Market Quick Glance

Two new highs reached for the DJIA and S&P500 but don’t get too excited—all four indices closed with year-to-date figures —and 1-year returns— lower on Friday than they were on Friday of the previous week (8/4/17).

Something to chew on from the Bespoke Investment Group piece titled, “U.S. Equity Share Continues To Drop” published August 11, 2017: “While President Trump can claim that the stock market has done exceptionally well since he was elected, he’s actually overseen a huge loss in the US’s share of total world stock market cap. When grading a presidency, you could argue that the latter is actuall more important….”

Below are the weekly and 1-year index performance results— including the dates each reached new highs— according to data from CNBC.com. Data is based on prices at the close of business for the week ending on Friday, Aug. 11,  2017.

 

-DJIA + 10.60% YTD down from last week’s +11.79%

  • 1 yr Rtn +17.43% down considerably from last week’s 20.38%
  • The DJIA reached another new all-time high on August 8, 2017 of 22,179.11

(Previous highs since March include: August 4, 2017 of 22,092.81; 21,841.18 on July 28, 2017; July 14, 2017 of 21,681.53; July 3,2017 of 21,562.75; 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +9.04% YTD down from last week’s 10.63%

  • 1yr Rtn +11.69% down considerably from last week’s +14.44%

The S&P 500 reached a new all-time high on August 8, 2017 of 2,490.87.

(Previous high of 2,484.04 was reached on July 27, 2017 and 2,477.62 was reached on July 20, 2017. Prior to that date new highs and dates include: 2,463.54 on July 14, 2017; 2453.82 on June 19,2017; 2,446.2 reached on June 9, 2017; 2,440.23 reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +16.23% YTD down from last week’s +17.99%

  • 1yr Rtn +19.66% down considerably from last week’s 22.94%

The Nasdaq reached a new all-time high of 6,460.84 on July 27, 2017.

(Previous highss include: July 20, 2017 of 6,398.26; 6,341.7 on June 9, 2017; 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +1.26% YTD down considerably from last week’s +4.07%

  • 1yr Rtn +11.81% down a lot from last week’s +16.36%

The Russell 2000 reached its latest all-time high on July 25, 2017 of 1,452.09.

(Previous highs include: 1,452.05 on July 21, 2017; 1,433.789 on June 9, 2017; 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

 

-Mutual funds

Play it again, Sam: The average cumulative total reinvested returns for equity funds on Thursday, August 10, 2017 were again lower  just as they were at the previous week’s close (8/4/17).

At the close of business on Thursday, 8/10/17, the average YTD total return for U.S. Diversified Equity Funds closed at 7.05%. That’s down from the 8.93% average return of the week before; the 9.59% average return of the week before it; and the 9.84% return of the week before that. All according to Lipper.

Interestingly, Large-Cap Growth Funds had an average y-t-d return of +16.87 and not far behind it Equity Leverage Funds, +16.39%. Both of those fund types fall under the broad Diversifeid Equity Funds heading.

It was Global Science/Technology Funds that posted the highest average returns of +25.54%, under the Sector Equity Funds heading and Natural Resources Funds that posted the lowest, -17.53% on average.

And World Equity Funds continue to provide investors with highest average returns, +17.76%. There are 4,516 funds that fall under that heading.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • Sad

According to the results of a recent three-question survey, published on CNBC.com, respondents don’t know beans about compound interest, inflation and stock market risk. Only 30% answered all three questions correctly.

Here’s the quiz and I sure do hope you’re smarter than the not-so-bright 70%:

Question 1

Suppose you have $100 in a savings account and the interest rate was two percent per year. After five years, how much do you think you would have in the account if you left the money to grow?

  1. More than $102
    B. Exactly $102
    C. Less than $102
    D. I don’t know

The correct answer is A. You’d have $102 after the first year. Over the next four years, interest will grow on that $102, meaning you’ll have more than $102. It’s a phenomenon known as compound interest.

Question 2

Imagine that the interest rate on your savings account was one percent per year and inflation was two percent per year. After one year, how much would you be able to buy with the money in this account?

  1. More than today
    B. Exactly the same as today
    C. Less than today
    D. I don’t know

The correct answer is C: less than today.

Question 3

Do you think the following statement is true or false: Buying a single company stock usually provides a safer return than a stock mutual fund.

The answer is false.

(Source: https://www.cnbc.com/2017/08/11/most-americans-cant-answer-these-basic-money-questions.html)

 

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POCKETBOOK: Week ending August 4, 2017

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•2,209. Can you handle it?

Lovers of the DJIA gotta be thrilled with the new highs this index continues to reach. But while no one knows how long that index will keep breaking records and reaching new highs, one thing everybody knows is that indices rise and fall over time. Even the DJIA.

So let’s bring a little pencil-to-paper reality into the world to prepare investors for what a 10% drop in the DJIA at its closing level on Friday, August 4, 2017 would translate to.

And that answer would be: A fall of 2,209 points bringing the Dow to roughly the 20,000 level.

Funny how a 2200 fall sounds like a lot, but 20,000 not quite so much.

That aside, take that drop figure up a notch to 20% and the DJIA would fall 4400 points.

Here’s hoping you, your mind and your portfolio are prepared to handle a fall of 10% or more because drops happen. How big a fall and for how long is the big unknown.

 

  • Market Quick Glance

The DJIA continued to reach a high new high level  at  week’s end. The same wasn’t true for the rest of the crew.

Below are the weekly and 1-year index performance results— including the dates each reached new highs— according to data from CNBC.com. Data is based on prices at the close of business for the week ending on Friday, Aug. 4, 2017.

-DJIA + 11.79% YTD up from last week’s +10.46%

  • 1 yr Rtn +20.38% up from last week’s 18.28%

The DJIA reached another new all-time high on August 4, 2017 of 22,092.81.

(Previous highs since March include: 21,841.18 on July 28, 2017; July 14, 2017 of 21,681.53; July 3,2017 of 21,562.75; 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +10.63% YTD up a bit from last week’s 10.42%

  • 1yr Rtn +14.44% up from last week’s +13.92%

The S&P 500 reached a new all-time high on July 27, 2017 of 2,484.04.

(Previous high of 2,477.62 was reached on July 20, 2017. Prior to that date new highs and dates include: 2,463.54 on July 14, 2017; 2453.82 on June 19,2017; 2,446.2 reached on June 9, 2017; 2,440.23 reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +17.99% YTD down from last week’s +18.42%

  • 1yr Rtn +22.94% down from last week’s 23.66%

The Nasdaq reached a new all-time high of 6,460.84 on July 27, 2017.

(Previous highss include: July 20, 2017 of 6,398.26; 6,341.7 on June 9, 2017; 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +4.07% YTD down from last week’s +5.31%

  • 1yr Rtn +16.36% down from last week’s +17.41%

The Russell 2000 reached its latest all-time high on July 25, 2017 of 1,452.09.

(Previous highs include: 1,452.05 on July 21, 2017; 1,433.789 on June 9, 2017; 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

 

-Mutual funds

Average YTD returns? Once again, less than those of the previous week.

At the close of business on Thursday, Aug. 3, 2017, the average YTD total return for U.S. Diversified Equity Funds closed at 8.93%. That’s down from the 9.59% average return of the week before, according to Lipper. And that was down from the week previous to it of 9.84%.

Mixed Asset Funds invest in both stocks and bonds—hence the name “mixed”. Under that broad heading that included 5,915 funds, the average year-to-date return was 8.37%.

The biggest winners in that group were Mixed-Asset Target Funds—-particularly those with the longest maturity dates. The winner here was Mixed-Asset Target 2055+ Funds, 12.67%.

Others with strong year-to-date average returns include: Mixed-Asset Target 2045 Funds had average returns of 12.35%; Mixed-Asset Target 2050 Funds at 12.19%, Mixed-Asset Target 2040 Funds, 11.64% and Mixed-Asset Target 2015 Funds 11.34%.

The poorest returns under the Mixed-Asset heading were found in Alternative Multi-Strategy Funds, 2.30% and Absolute Returns Funds, 3.08%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • Gas highs

Just about the time I got used seeing gas prices hovering around the $2 a gallon level, prices jumped up. Rats!

But things could be worse.

According to AAA, $2.35 was the average price for a gallon of regular unleaded gas around the country last week. One month ago it was 2.24 and one year ago it was 2.13.

Here’s the “worse” part: The highest price on record for a gallon of reg. unleaded was $4.12 reached in July 2008.

Guess 2.35 isn’t so bad after all.

 

POCKETBOOK: Week ending July 28, 2017

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  • Fewer choices

Equity prices and market indices continued their tear. One reason? Could be because there are fewer stocks to choose from.

According to data from the University of Chicago’s Center for Research in Security Prices (CRSP) the number of stocks is at its lowest level in decades. In November of 1997, for instance, there were  7,355 U.S. stocks and now there are fewer than 3,500.

That’s a huge drop. Huge.

Also on the slide are the number of initial public offerings, IPOs, while the appetite for investing in the private market is growing.

That aside, in today’s high-rising market environment, investors ought not forget to remember –re the higher prices—  that what happens when a serious desire for equities mixes with a bounty of money and fewer publicly traded companies to choose from is  prices go up.

And that’s how bid/ask auction marketplaces work.

 

  • Market Quick Glance

As equity prices continued to rise, they brought with them new index highs. The DJIA, for instance, reached a new high when the market closed on Friday, the S&P 500 and NASDAQ hit there’s on Thursday and the Russell 2000 on Monday.

So much for consistency.

Speaking of which, if there is one consistent thing this bull has shown investors is that this time it really is different. And quite likely, the sooner everyone decides to believe that, the sooner the bears will probably begin to roar.

Below are the weekly and 1-year index performance results— including the dates each reached new highs— according to data from CNBC.com. Data is based on prices at the close of business for the week ending on Friday, July 28,   2017.

-DJIA + 10.46% YTD up from last week’s +9.20%

  • 1 yr Rtn +18.28% up from last week’s 16.54%

The DJIA reached a new all-time high of 21,841.18 on July 28, 2017.

(Previous highs include: July 14, 2017 of 21,681.53; July 3,2017 of 21,562.75; 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +10.42% YTD down a hair from last week’s 10.44%

  • 1yr Rtn +13.92% down from last week’s +14.20%

The S&P 500 reached a new all-time high on July 27, 2017 of 2,484.04.

(Previous high of 2,477.62 was reached on July 20, 2017. Prior to that date new highs and dates include: 2,463.54 on July 14, 2017; 2453.82 on June 19,2017; 2,446.2 reached on June 9, 2017; 2,440.23 reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +18.42% YTD down from last week’s +18.66%

  • 1yr Rtn +23.66% down from last week’s 25.89%

The Nasdaq reached a new all-time high of 6,460.84 on July 27, 2017.

(Previous highss include: July 20, 2017 of 6,398.26; 6,341.7 on June 9, 2017; 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +5.31% YTD down from last week’s +5.80%

  • 1yr Rtn +17.41% down from last week’s +19.27%

The Russell 2000 reached its latest all-time high on July 25, 2017 of 1,452.09.

(Previous highs include: 1,452.05 on July 21, 2017; 1,433.789 on June 9, 2017; 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

 

-Mutual funds

Average returns? Less than the week before.

The average U.S. Diversified Equity Fund lost a little ground last week closing at 9.59% at the close of business on Thursday, July 27, 2017, according to Lipper. That’s down from the previous week’s close of 9.84%.

If you’ve still only been thinking U.S. equities, one thing this year has shown investors is that better investment returns can be found in other places around the globe.

For instance, the average y-t-d return of the 4,516 funds that fall under the World Equity Funds heading,is 19.35%. That about 10% higher than what the average diversified equity fund has returned.

Yes, India Region Funds still rule—up on average 32.03%.

Of course the big question is how long will world funds continue to outperform U.S. ones. And the answer is: as long as other countries’ econonmies grow faster than ours.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • Happy Birthday Medicare & Medicaid

In case you missed it, it was on July 30, 1965 that President Lyndon B. Johnson signed Medicare into law. He also signed Medicaid into law that same day. Both amendments to the Social Security Act.

Here’s more about that  history from History.com: “At the bill-signing ceremony, which took place at the Truman Library in Independence, Missouri, former President Harry S. Truman was enrolled as Medicare’s first beneficiary and received the first Medicare card. Johnson wanted to recognize Truman, who, in 1945,had become the first president to propose national health insurance, an initiative that was opposed at the time by Congress.

“The Medicare program, providing hospital and medical insurance for Americans age 65 or older, was signed into law as an amendment to the Social Security Act of 1935. Some 19 million people enrolled in Medicare when it went into effect in 1966. In 1972, eligibility for the program was extended to Americans under 65 with certain disabilities and people of all ages with permanent kidney disease requiring dialysis or transplant. In December 2003, President George W. Bush signed into law the Medicare Modernization Act (MMA), which added outpatient prescription drug benefits to Medicare.

“Medicare is funded entirely by the federal government and paid for in part through payroll taxes. Medicare is currently a source of controversy due to the enormous strain it puts on the federal budget. Throughout its history, the program also has been plagued by fraud–committed by patients, doctors and hospitals–that has cost taxpayers billions of dollars.

“In 1977, the Health Care Financing Administration (HCFA) was created to administer Medicare and work with state governments to administer Medicaid. HCFA, which was later renamed the Centers for Medicare & Medicaid Services (CMS), is part of the Department of Health and Human Services and is headquartered in Baltimore…”

 

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pbTrumpBits#13: Testa’s

 

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Testa’s Restaurant closed on July 15, 2017. The Testa family had been pleasing the palates of Palm Beachers and guests from around the world since 1921.  The closing of its front door brings with it the end of an era. One that showed the homey side of Palm Beach. Now that’s gone. Bummer.

The blueberry pancakes were my favorite. I know, I know, for lots of folks it was Testa’s signature strawberry pie or their 30 oz. sirloin Steak for Two that brought them in—and then back again and again. Whatever your fav, the Testa family had been feeding Palm Beachers and guests from near and far since the 1920s. That’s epic. And historic.

So historic that the closing of Testa’s restaurant on Royal Poinciana Way on July 15, 2017 brought with it the end of an era in Palm Beach. An era that in its only-as-the- Testa- family-could-do way melded the uber-wealthy with the not-so-financially secure in a cozy, knotty pine environment.

But those days are now gone. And worse yet, the only open-to-the-public Palm Beach establishments that have been around since the 1920s numbers only five: Two churches, Bethesda-by-the-Sea and St. Edwards and  three hotels, The Breakers, The Brazilian Court and The Chesterfield.

In case it’s slipped your mind, while Mar-a-Lago was built in the 1920s, it’s never been an open-to-the-public joint.

And while I’m on that subject, plenty of royalty, movie stars, heads of state, star athletes, musicians, rich-and-famous so-and-so’s—- including President John F. Kennedy, Alexander Haig, Greg Norman, Dustin Hoffman, Jimmy Buffett, Elton John, John Lennon, etc.etc. —have all dined at Testa’s over the past 96 years. One obvious exception: Donald J. Trump.

I had breakfast with Judy Testa Storey two days before the place closed and asked her if the president had ever been there. “ Nope,” she said. “Never.”

His loss for sure.

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POCKETBOOK: Week ending July 21, 2017

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  • Both Sides

On the one hand, the VIX ,(it’s designed to track stock market fear), is at its lowest level —-hold on to your hat– in 24 years. That puts it when Bill Clinton was president. This according to BusinessInsider.com.

In another BusinessInsider.com piece,  private client cash levels are reportedly super low because those folks would rather invest in the market than to hold cash. True for institutional investors, too. Reason being ecause of the continued robust returns in the U.S. and many global markets.

On the other hand,  there is something referred to as the “Icarus trade”. Or simply put, flying too close to the sun eventually burns everybody.

According to a client note from strategists at Bank of America Merrill Lynch, “A big fall in markets…. will be an autumn, not summer event…. and Icarus won’t soar forever.”

 

  • Market Quick Glance

Last week, and for the most part, the bulls were still running—with one exception, the DJIA. It lost ground for the week and in its 1-year return.

Below are the weekly and 1-year index performance results— including the dates each reached new highs— according to data from CNBC.com. Data is based on prices at the close of business for the week ending on Friday, July 21,  2017.

 

-DJIA + 9.20% YTD down from last week’s +9.49%

  • 1 yr Rtn +16.54% down from last week’s 16.92%

The DJIA reached a new all-time high on July 14, 2017 of 21,681.53.

(Previous high was on July 3,2017 of 21,562.75. Prior to that high dates include: 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +10.44% YTD up from last week’s 9.85%

  • 1yr Rtn +14.20% up from last week’s +13.66%

The S&P 500 reached a new all-time high of 2,477.62 on July 20, 2017.

(Prior to that date new highs and dates include: 2,463.54 on July 14, 2017; 2453.82 on June 19,2017; 2,446.2 reached on June 9, 2017; 2,440.23 reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +18.66% YTD up from last week’s +17.26%

  • 1yr Rtn +25.89% up from last week’s 25.40%

The Nasdaq reached a new all-time high on July 20, 2017 of 6,398.26

(Previous high include: 6,341.7 on June 9, 2017; 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +5.80% YTD up from last week’s +5.28%

  • 1yr Rtn +19.27% up from last week’s +18.85%

The Russell 2000 reached its latest all-time high of 1,452.05 on July 21, 2017.

(Previous highs include: 1,433.789 on June 9, 2017; 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

 

-Mutual funds

The average U.S. Diversified Equity Fund gained ground last week and closed at 9.84% at the end of the business day on Thursday, July 20, 2017, according to Lipper. That’s up from the previous week’s close of 8.74%.

Of the 8,549 U.S.Diversified Equtiy Funds heading, Equity Leverage Funds lead the way with a YTD average return of 22.19%.  Dedicated Short Bias Funds lost ground with the average YTD return for funds in it -14.23 %.

Sector Equity Funds showed their stuff with Global Science/Technology Funds YTD average returns of 29.97%. Commodities Energy Funds were the losers at -17.48%.

Under the World Equity Funds heading India Region Funds continued to shine, up for the year an average of 30.42%.The closest downer, still above 10%, were Global Equity Income Funds, 10.72%.

And shareholders of Mixed Asset Funds had the sweetest YTD returns if they were invested in Mixed-Asset Target 2055+Funds, 12.70%. Lowest returns, although still on the plus-side of the grade, were in Alternative Multi-Strategy Funds, 2.18%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • On the lighter side…

It’s summertime. People are traveling and flying more. Getting squeezed more, too. But small seats and limited leg space isn’t the point of this brief. Nope, the subject is food. Airplane food. Good and bad. Food that passengers seated in all classes– from those in the back-of-the-plane to those in first-class and private jets—are offered.

In a Bloomberg.com piece titled “Why You Should Never Eat Food on Planes, and Other Jet-Set Tips” by Mark Elwood, I read that one well-traveled stewardess had a “tried-and-true” secret: Forget eating in-flight.

Why? When flying high, your digestive system shuts down.

As a result, once back on Earth that same system has to start working harder just to get things moving and doing so makes you tired.

Wanna land feeling refreshed, forget about eating and over-eating. Instead, drink oodles and oodles of water. You and your body will likely be much happier.

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POCKETBOOK: Week ending July 14, 2017

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  • Middle class illusion

 If you’re at all like 70 percent of America’s adult population, you consider yourself middle class both in income and mindset. This, according to the results from Northwestern Mutual’s 2017 Planning and Progress study.

Too bad that’s not really the case.

Turns out the middle class has lost a serious amount of its heft over the past 45-ish years. According to Pew Research Center, in 1971, middle-income households totaled 61 percent of the household landscape. But by 2015, that percentage had slid to 50 percent.

While the middle class is shrinking, both the number of households in the upper- and lower-income levels has been on the rise.

So much for that 70 percent thinking.

 

  • Market Quick Glance

I get nervous when all the 30-some stocks that I follow close in the green. But, that’s what happened as of the close of market business Friday.

As for the four indices followed here, all four had a great week with year-to-date numbers higher than the week previous. Additionally, both the DJIA and S&P 500 reached new highs for the year.

That’s all hunky dorey but take notice of the 1-year returns and you will see that all four indices figures are lower than they were a week ago.

So, as Friends character Joey Tribbiani would say, “How YOU doin?”

And if you’re doin good, maybe it’s time to lock in some profits. Nobody has ever gone  broke doin that.

Below are the weekly and 1-year index performance results— including the dates each reached new highs— according to data from CNBC.com. Data is based on prices at the close of business for the week ending on Friday, July 14, 2017.

-DJIA + 9.49% YTD up handsomely from last week’s +8.36%

  • 1 yr Rtn +16.92% down from last week’s 19.66%

The DJIA reached a new all-time high on July 14, 2017 of 21,681.53.

(Previous high was on July 3,2017 of 21,562.75. Prior to that high dates include: 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +9.85% YTD up attractively from last week’s 8.32%

  • 1yr Rtn +13.66% down from last week’s +15.60%

The S&P 500 reached a new all-time high of 2,463.54 on July 14, 2017.

(Prior to that date new highs and dates include: 2,453.82 on June 19,2017; 2,446.2 reached on June 9, 2017; 2,440.23 reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +17.26% YTD up seriously from last week’s +14.30%

  • 1yr Rtn +25.40% down from last week’s 26.17%

The Nasdaq reached a new all-time high of 6,341.7 on June 9, 2017.

(Previous highs include: 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +5.28% YTD up enough to notice from last week’s +4.33%

  • 1yr Rtn +18.85% down seriously from last week’s +23.14%

The Russell 2000 reached its latest all-time high of 1,433.789 on June 9, 2017. (Previous highs include 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

-Mutual funds

Like the major indices showed their stuff, last week the average U.S. Diversified Equity Fund gained ground too closing at 8.74% at the close of business on Thursday, July 13, 2017, according to Lipper. That’s up attractively from the previous week’s close of 6.95%.

That said, time is one of the most important factors to consider before dipping your toe into the ever-changing currents of the stock market. And just like every other thing associated with investing, there is no one guaranteed time frame that comes with the promise of making you money. All time frames can be rewarding or disappointing. That’s just the nature of this beast.

To make that point, here’s a relatively short-term look at the cumulative total reinvestment performance for the 8,549 funds that fall under the U.S. Diversified Equity Funds over seven time periods:

-1 week: up 1.62% (7/6/17 through 7/13/17)

-4 weeks: up 1.01% (6/15/17 through 7/13/17)

-13 weeks: up 5.50% (4/13/17  through /13/17)

-52 weeks: up 14.88% (7/14/16 through 7/13/17)

-2 years: up 7.47% (7/9/15 through 7/13/17)

-3 years: up 6.64% (7/10/14 through 7/13/17)

-5 years: up 12.65% (7/12/12 through 7/13/17)

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • IPOs? Not so fast

Louis Navellier is no fan of investing in IPOs.

According to his recent Navellier Growth Fund newsletter, this well-established money manager pointed out that over 70 companies have already gone public so far this year. But, while that’s exciting news for some, Navellier warns everyday ordinary investors to stay away from these big-time hyped and often temping offers.

“The last thing you should do is buy into the hype,” he said. The reason? Because he said there is “ too much volatility early on.”

Instead, he suggests waiting. “If you want to get into these companies, I recommend that you come back in a year or two….And I say that for one specific reason—-earnings results.”

 

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POCKETBOOK: Week ending July 7, 2017

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•Losing money in the market?

There has never been any honest-to-God guarantees that come once you decide to invest some of your money into the stock markets. And there never will be.

That’s because, in the broadest sense, as stocks trade hands during every trading day of the year profits and loses are chalked up in all individual and professional account ledgers.

With that reality in mind, Barbara Friedberg penned a piece titled “Why People Lose Money in the Market” that appeared at TheBalance.com recently.

According to this former portfolio manager turned author, the three reasons people lose money are:

-Because they don’t understand economic and investment cycles.

-Because they let their emotions drive their investing.

-And because they think investing is a get-rich-quick scheme.

Got that?

 

  • Market Quick Glance

The major indices closed up during the past week. And that’s the good news.

What’s the bad? Who knows. The bull that has been running wild on Wall Street for the last eight years seems to be some kind of  anchored. And until the future provides us with a look at the past, we won’t know for sure what does this bully in.

Below are the weekly and 1-year index performance results— including the dates each has reached  new highs. All  this according to data from CNBC.com. and based  upon market results at the close of business for the week ending on Friday, July 7,   2017.

-DJIA + 8.36% YTD up from last week’s +8.03%

  • 1 yr Rtn +19.66% up from last week’s 19.07%

The DJIA reached a new all-time high on July 3,2017 of 21,562.75.

(Previous highs include 21,535.03 on June 20, 2017; 21,391.97 reached on June 14, 2017; 21,305.35 on June 9, 2017; 21,225.04 on June 2, 2017; and 21,169.11 on March 1, 2017.)

 

-S&P 500 +8.32% YTD up from last week’s 8.24%

  • 1yr Rtn +15.60% up from last week’s +15.46%

The S&P 500 reached a new all-time high of 2,453.82 on June 19,2017.

(The previous high of 2,446.2 was reached on June 9, 2017. Before that 2,440.23 was reached on June 2, 2017; 2,418.71 reached on May 25, 2017; 2,405.77 reached on May 16, 2017; 2403.87 on May 9, 2017; 2,400.98 reached on March 1, 2017.)

 

-NASDAQ +14.307% YTD up from last week’s +14.07%

  • 1yr Rtn +26.17% down from last week’s 26.80%

The Nasdaq reached a new all-time high of 6,341.7 on June 9, 2017.

(Previous highs include: 6,308.76 on June 2; 6,217.34 reached on May 25; 6,170,16 on May 16; 6,133 on May 9, 2017; 6102.72 on May 2, 2017; 6074.04 on April 28, 2017; and 5,936.39 on April 5, 2017.)

 

-Russell 2000 +4.33% YTD up from last week’s +4.29%

  • 1yr Rtn +23.14% up from last week’s +22.87%

The Russell 2000 reached its latest all-time high of 1,433.789 on June 9, 2017.

(Previous highs include 1,425.7 reached on April 26, 2017 and of 1,414,82 reached on March 1, 2017.)

 

-Mutual funds

Equity funds lost ground last week as, at the close of business on Thursday, July 6, 2017, the year-to-date total return for the average U.S. Diversified Equity Funds stood at 6.95%. That’s down from the previous week’s close of 7.52%.

Looking back over the last 52 weeks (7/7/16 thru 7/6/17), the three fund types under this broad heading that have rewarded their shareholders the most include: Equity Leverage Funds +33.39%; Small-Cap Value Fund, ++21.06%; Small-Cap Growth Funds, +20.87%.

The three fund types experiencing the poorest returns over that same time period were: Dedicated Short-Bias Funds, -23.22%; Alternative Equity Market Neutral Funds, +0.90%; and Specialty Diversified Equity Funds, +4.30%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • Got stocks?

The market has been roaring this year but that doesn’t mean everyone has participated in the bounty. In fact, according to a 2016 Gallup Poll, just over half (52%) of American adults say that they had money invested in the stock market.

That’s down from a high of 65% in 2007.

It  ought to come as no surprise that those who make up the middle-class and who were in the market prior to the crash of 2007 have stayed away from it in recent years.

On another kinda sorta related subject, the American Bankers Association Consumer Credit Delinquency Bulletin has reported that in the first quarter of 2017 there was an increase in late payments for car, truck, home equity and credit card loans/debts.

Guess if you don’t have enough cash to meet your monthly expenses/commitments it’s not likely that you’ll have enough to invest in the market.

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The 4th of July and The First Amendment

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Every day I am grateful for the fact that I live in the United States of America. A country where people are recognized as individuals and are  free to voice their opinions, speak their minds and to live in accordance with them, within reason.

More importantly, I’m thankful that our founding fathers had the wisdom to know– and address– our human needs and frailties in the writing of our Declaration of Independence, the Constitution and the Bill of Rights.

As we celebrate this Independence Day, and the words written in the Declaration of Independence, I am reminded that that document is not and was never intended to be a stand-alone guide. Without the subsequent Constitution and Bill of Rights, our nation would not have evolved as grandly as it has.

Given that reality, and the current political climate in America today, I’d like to take this time to focus on the First Amendment in the Bill of Rights.

There is a good reason why the First Amendment is first and not the second, or third or whatever in the list of 10 Amendments in the Bill of Rights: It’s the most important— and the most vital– in securing that our democracy lives on.

Without the First Amendment recognized and honored, I shutter to think what would have happened to our country over the past 240-some years. Or, how we would be living or governed in these United States today.

So on this 4th of July, take a minute to read the following “Statement in Support of Freedom and the Press” written by Supreme Court Justice Hugo Black, an Associate Justice of the Supreme Court of the United States from 1937 to 1971:

“In the First Amendment the Founding Fathers gave the free press the protection it must have to fulfill its essential role in our democracy. The press was to serve the governed, not the governors. The Government’s power to censor the press was abolished so that the press would remain forever free to censure the government.”

Celebrate and  Happy 4th of July.