Sharkey, Howes & Javer

Despite a decline in both the manufacturing and non-manufacturing ISM (Institute for Supply Management) survey indices, 10 year Treasury yields increased to 1.67%. For the first time in a while, we are also starting to see German and Japanese 10 year bonds in positive rate territory. Here in the U.S., household debt remained low and a survey released by BLS (Bureau of Labor Statistics) indicates that 2015 spending increased, mainly due to increased personal insurance and retirement contributions. Listen in to hear more on these issues as well as how total household debt as a percentage of GDP in the U.S. compares to Canada.

The combination of improved earnings, strong U.S. economic data, and the prospects for continued low interest rates are likely indicators that propelled the S&P 500 and the Nasdaq indices into all-time highs this month. Listen in to hear more on this and about U.S. consumer spending, debt levels and savings.

July wrapped up with a nice rally in the U.S. markets, proving that summer can be a productive season in your investment portfolio. Today’s discussion brings our attention to U.S. GDP, the bond markets, and the emerging markets. Listen in to find out which two emerging market countries are projected to be the fastest growing in 2016!

As the frenzy surrounding the Brexit vote calms down, we shift our focus to the U.S. economy where we are rapidly approaching full employment and continue to be perceived as an attractive investment. While a third of the world has negative sovereign debt rates, the U.S. offers better yields, a sense of security and liquidity to domestic and foreign investors. Inflation remains low and we are starting to see real estate slow down to historical trends in many regions. This week, we also touch on the progress of Abenomics along with a possible constitutional change in Japan - listen in to hear what that change may be!

Today we bring you a special edition of Inside the Economy with SH&J. As many are now aware, last Friday, 52% of voters elected for the United Kingdom to leave the European Union after a 43 year partnership. While it is not a legally binding referendum, the UK will begin a 2 year clock negotiating the terms of their exit. As a result of the vote, the global markets fell approximately 12% and the U.S. markets fell around 5%. The jury will be deliberating this unprecedented event for several months or longer but one thing is for sure, markets hate uncertainty and increased volatility is expected over the short term. Although we have been assessing the investment ramifications of a Brexit for some time (knowing that the polls showed the vote would be very close), we don’t necessarily feel it will have any significant impact on the U.S. economy. The correction of the U.S. markets in particular over the past two days, in our opinion, is primarily based on fear of change and has little to do with U.S. economic

As the summer heat rises, the economic news slows down. This week’s Inside the Economy with SH&J focuses on Thursday’s Brexit vote as well as newly released U.S. consumer debt figures. Listen in to find out which U.S. state has risen to the #6 seat in the world’s largest economies and why we likely won’t be seeing interest rate increases this summer.

This week’s Inside the Economy with SH&J provides updates on the jobs report released last week and the effect it had on the bond market as well as the likelihood for the Federal Reserve to raise rates in June. An increase in average hourly earnings has created a concern about increased automation leading to elimination of some minimum wage jobs or jobs going to more highly educated individuals. Listen in to hear more on the continued inflow of new money into the U.S. from overseas in search of safety and liquidity.

As we transition into summertime, the news is slowing and the economic committee reviews macroeconomic trends including a look at the Federal debt level and increased subprime lending (mostly in auto loans) as well as China’s continued investment in U.S. real estate. Additionally, hear what information about Saudi Arabia has been kept a secret for more than four decades and how much of the focus around the world is on treasuries and confidence. Post your questions one the blog and we will answer them during our next Inside the Economy with SH&J in two weeks!

Larry Howes kicks off the New Year with his outlook on the economy in 2016. How did the interest rate increase in December affect mortgages? Will U.S. inflation reach the Fed’s target rate of 2%? What is expected from the U.S. economy and markets this year? What will happen to the U.S. dollar? What can we expect to see in Europe this year? Listen in as Larry addresses these questions and more!