For the week ending Jan. 30, 2016
- Millennials on money
Looks as though some kids aged 22 to 32 have a bit of wandering blood in them when it comes to earning a living and job loyalty.
Sixty percent of millennials, ages 22-32, have changed jobs between one and four times in the last five years, according to State Street Global Advisors.
From the Reuters story about them comes this: “While pay is important, it’s clear that millennial won’t stay with companies for money alone,” said David Cruickshank, global chairman of consulting firm Deloitte, the firm that conducted the research.
Additionally, “44 percent of millennials would leave their current employer in the next two years, if given the choice.” Asked about job loyalty and looking into the future four years out, 66 percent said that they would expect to have switched employers.
- Market Quick Glance
Below are year-to-date performance figures for the major indices through January 29, 2016, according to Bloomberg. To provide a broader performance perspective, 1-year returns have been added.
-S&P 500 -4.96% YTD
1yr Rtn -0.67%
-Dow Jones -5.39% YTD
1yr Rtn -1.67%
1yr Rtn +0.82%
-Russell 2000 -9.92% YTD
1yr Rtn -8.80%
Did you notice? There’s a + return in that grouping. Find it and be happy.
Through Thursday, January 28, 2016 the average U.S.Diversisfied Equity fund was down 8.47 percent, according to Lipper. That’s a tad better than last week’s numbers and similar to the 52-week performance. It was was down 8.40 percent.
Visit www.allaboutfunds.com for weekly updates to see how 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.
Lipper’s weekly performance figures for stock and fixed-income funds are at www.allaboutfunds.com in the left column on the home page.
-Oil and China
Great story on CBS’s Sunday Morning television program, (1/31/16), about the good and bad sides of dropping oil prices. In a nutshell, the overproduction of oil is coming from countries all around the world, including the U.S. And even though China’s economy is slowing, they had been big time users of the stuff, the state of the world’s overproduction isn’t likely to drop any time soon.
That’s good news for those of us who need to fill up at the tank. It’s bad news for those in the oil business where production has roughly doubled between 2009 and 2015 and since we don’t need the extra production now hundreds of oil rigs sit idle. Plus, oil industry job losses numbered 275,000 in 2014. Job loss is never good for an economy, oil company stock prices but most importantly for those individuals who have lost their jobs.
As always, it’s complicated.
Being financial literate is a must for everyone given that it is money that rules the world with an unforgiving iron fist these days.
I ran across this short 5-question quiz originally targeted at millennials at ThinkAdvisor.com and figured you might want to test your money mind.
From a piece titled “Quiz Time: Do Investors Understand How Financial Services Really Works? “ here are the questions:
1) Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow?
- a) More than $102
b) Exactly $102
c) Less than $102
d) Don’t know
e) Prefer not to say
2) Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, how much would you be able to buy with the money in this account?
- a) More than today
b) Exactly the same
c) Less than today
d) Don’t know
e) Prefer not to say
3) Buying a single company’s stock usually provides a safer return than a stock mutual fund.
- a) True
c) Don’t know) Prefer not to say
4) A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage, but the total interest paid over the life of the loan will be less.
- a) True
c) Don’t know
d) Prefer not to say
5) If interest rates rise, what will typically happen to bond prices?
- a) They will rise
b) They will fall
c) They will stay the same
d) There is no relationship between bond prices and the interest rate
e) Don’t know
According to those who created the survey and test: “Individuals are considered to have a basic level of financial literacy if they answered the first three question correctly; and an advanced level of financial literacy if they answer all five questions correctly.” The answers are: 1) a; 2) c; 3) b; 4) a; and 5) b.
So how did you do? Of the millennials taking the quiz, 24% answered the first three questions correctly; and only 8% of them correctly answered all five.