Money Talk Podcast

Landaas & Company newsletter  February edition now available.

Advisors on This Week’s Show

Bob Landaas

Kyle Tetting

Art Rothschild

Steve Giles

Chris Evers

(with Max Hoelzl, engineered by Jason Scuglik)

Week in Review (Feb. 21-25, 2022)

SIGNIFICANT ECONOMIC INDICATORS & REPORTS

Monday

Markets closed for Presidents Day

Tuesday

Housing prices continued to far outpace overall inflation in December with a year-to-year increase of nearly 19%, according to the S&P CoreLogic Case-Shiller index. It marked the largest calendar-year jump in prices in 34 years of data but was also the first time in several months the pace of gains didn’t decelerate from the month before. An analyst for S&P said the 20 cities tracked by the index reached all-time high prices in 2021. He also forecast that rising mortgage interest rates will slow the trend.

The Conference Board reported a decline in its consumer confidence index in February, the second setback in a row. Consumers had a slightly higher opinion of current economic conditions but lower expectations for the next six months. The business research group said survey results suggest a moderation in economic growth in the first half of 2022 but that consumers remain relatively confident and don’t anticipate the economy will get worse. Consumers registered more concerns about inflation in February after two months of declines.

Wednesday

No major releases

Thursday

The Commerce Department said the sales pace of new homes declined in January to an annual rate of 801,000. That was down 4.5% from December’s rate and 19% behind the pace in January 2021. The median price for a new house was $423,300, up 13% from the year before. And the number of houses for sale climbed past 400,000 for the time since August 2008.

The four-week moving average for initial unemployment insurance claims declined for the third week in a row and was 36% below the 55-year average, according to new Labor Department data. Barely 2 million Americans claimed jobless benefits in the latest week, down from nearly 20 million the year before.

The U.S. economy rose at a slightly faster pace than initially estimated in the fourth quarter, with gross domestic product expanding at a 7% annual rate. The Bureau of Economic Analysis said consumer spending, which drives about 70% of economic activity, rose at an annual rate of 3.1% from October through December, down from an initial estimate of 3.3%. For all of 2021, the economy grew by 5.7%, adjusting for inflation, the fastest expansion since 1984.

Friday

Personal spending rose in January by 2.1% following a 0.8% decline in the month of December. This outpaced the 1.5% consensus estimate. The Fed's preferred measure of inflation, the PCE price index rose to 6.1% year over year due to a 0.6% increase for the month. Personal income was unchanged for the month in nominal terms.

New orders for durable goods rose 1.6% in January and the December data point was revised from a 0.9% decline to a 1.2% gain. Increase in non-defense aircraft orders accounted for most of the headline rise. If transportation-based orders are stripped out, the January increase comes down to 0.7%. Inventories as well as unfilled orders also rose for the 12th consecutive month.

The University of Michigan reading of consumer sentiment rose to 62.8 from a previous February reading of 61.7. This remains at one of the lowest levels in the last decade as consumers weigh high inflation data and rising interest rates.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13695, up 147 points or 1.1%

Standard & Poor’s 500 – 4385, up 36 points or 0.8%

Dow Jones Industrial – 34059, down 21 points or 0.1%

10-year U.S. Treasury Note – 1.99%, up 0.05 point

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Landaas & Company newsletter  February edition now available. Advisors on This Week’s Show Bob Landaas Kyle Tetting Brian Kilb Kendall Bauer (with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik) Week in Review (Feb. 14-18, 2022) SIGNIFICANT ECONOMIC INDICATORS & REPORTS Monday No major announcements Tuesday Inflation on the wholesale level rose 1% in January, another sign […]

Landaas & Company newsletter  February edition now available.

Advisors on This Week’s Show

Kyle Tetting

Dave Sandstrom

Paige Radke

(with Max Hoelzl and Joel Dresang, engineered by Reuben Neese)

Week in Review (Feb. 7-11, 2022)

Significant Economic Indicators & Reports

Monday

The Federal Reserve reported a 5.9% rise in consumer debt outstanding in 2021, including a 6.6% increase in credit card debt. Credit card debt rose $75 billion or 7.8% since hitting a four-year low in January 2021. The level was still $59 billion or 5.4% short of where it peaked just before the COVID-19 pandemic. An indicator of consumer confidence, credit card debt stood about where it was in mid-2017. It took nearly a decade for credit card debt to recover from the Great Recession.

Tuesday

The U.S. trade deficit rose 1.8% in December as imports led by cell phones, cars and crude oil outpaced exports including pharmaceutical preps, automotive parts and plane engines. The Bureau of Economic Analysis said the full-year deficit widened 27% to a record $859 billion, reflecting the continued uneven recovery from the global recession triggered by the pandemic. Since 2020, the value of imports into the U.S. rose by 20.5% while exports to other countries grew by 18.5%.

Wednesday

No major releases

Thursday

The four-week moving average for initial unemployment claims declined for the first time in six weeks, which was the lowest level since 1969. Data from the Labor Department shows the latest four-week average was 32% below the all-time average, though still 21% higher than the low point just before the pandemic began. More than 2 million Americans were claiming jobless benefits in the latest week, up 1.5% from the week before but down from 20.2 million the year before.

The broadest measure of inflation showed 12-month price increases rising in January to their highest level in decades. The Consumer Price Index rose 0.6% from December, the same gain as in December, but down from 0.7% in November and 0.9% in October. Year to year, inflation rose 7.5%, the most since February 1982. Top drivers of the price hikes: Groceries, electricity, housing rents and used cars. Excluding volatile costs for energy and food, the index was 6% higher than in January 2021, the highest one-year increase since August 1982.

Friday

The University of Michigan said consumer sentiment slipped from the end of January to its lowest level in a decade. Inflation expectations weighed down consumer outlooks, with nearly half of the households surveyed saying they expect their inflation-adjusted incomes to decline in the next year. Consumers reporting rising personal wealth dropped to the lowest level since May 2020, largely because of falling expectations for stock price increases in 2022.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13791, down 307 points or 2.2%

Standard & Poor’s 500 – 4418, down 82 points or 1.8%

Dow Jones Industrial – 34737, down 352 points or 1%

10-year U.S. Treasury Note – 1.96%, up 0.03 point

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Landaas & Company newsletter  February edition now available. Advisors on This Week’s Show Bob Landaas Kyle Tetting Art Rothschild Chris Evers (with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik) Week in Review (Jan. 31-Feb. 4, 2022) Significant Economic Indicators & Reports Monday No major reports Tuesday The manufacturing sector continued expanding in January, though at […]

Landaas & Company newsletter  January edition now available.

Advisors on This Week’s Show

Bob Landaas

Kyle Tetting

Dave Sandstrom

Kendall Bauer

(with Max Hoelzl and Joel Dresang, engineered by Jason Scuglik)

Week in Review (Jan. 24-28)

Significant Economic Indicators & Reports

Monday

No major releases

Tuesday

Increases in home prices continued to far outpace overall inflation in November. The S&P CoreLogic Case-Shiller home price index rose 18.8% from the year before, down from 19% in October and the third monthly deceleration since peaking at 20% in August. The recent slowdown in home price gains is the first since the very beginning of the COVID-19 pandemic. An analyst affiliated with the index said rising mortgage rates should affect price increases.

The Conference Board said its consumer confidence index declined in January for the first time in four months. Although consumers gave higher marks to current economic conditions, their outlook for the near-term economy fell. The business research group said the mixed signals suggested the economy entered 2022 on solid footing but the growth rate would moderate in the first quarter. An economist for the group cited the pandemic and rising prices as challenges to confidence and spending in the near term.

Wednesday

Full-year 2021 new home sales of more than 760,000 new houses stayed above the mark just before the Great Recession, though they slid from more than 800,000 in 2020. The Commerce Department estimated the median price of a new house rose past $390,000 in 2022, up 17% from 2020. Nearly half (48%) of the new houses sold went for $400,000 or more, up from 34% in 2020.

Thursday

The Commerce Department reported durable goods orders declined 0.9% in December for the first setback in three months. Slower orders were widespread, led by commercial aircraft. Compared to December 2020, orders for long-lasting factory goods rose nearly 21%. Excluding transportation equipment, orders rose 16% from the year before. A proxy for business investment gained 15% from December 2020.

The U.S. economy rose at an annual pace of 6.9% in the fourth quarter, up from 2.3% in the previous three months. The Bureau of Economic Analysis said growth in consumer spending, business inventories and exports fueled the increase. On a full-year inflation-adjusted basis, gross domestic product rose 5.7% from 2020, the biggest increase since 1984. The average annual gain since records began in 1948 was 3.5%.

The four-week moving average for initial unemployment claims rose for the fourth week in a row after hitting a 52-year low around Christmas. Still, the average was under 25o,000 new applications, down from 5.3 million in April 2020 and 33% below the all-time average dating back to 1967. The Labor Department said 2.1 million Americans claimed jobless benefits in the latest week, down from 19 million the year before.

The National Association of Realtors said its index of pending home sales fell for the second month in a row, dropping 3.8% in December, largely because would-be buyers had fewer houses to choose. The trade group also blamed rising mortgage interest rates, which it contends will slow demand for housing in 2022. The group’s economist forecast that just under 6 million houses will be sold in 2022, which would be a decline of 2.8%

Friday

The Bureau of Economic Analysis said consumer spending fell 0.6% in December, the first decline since last February, even though personal income rose 0.3%, including a 0.7% gain in wages and compensation. A key driver of U.S. economic output, personal spending on goods fell for the month, while spending on services rose marginally. The personal consumption expenditures index, which the Fed follows for inflation, rose 5.8% from December 2020, the steepest incline since July of 1982. The monthly increase in the PCE was 0.4% in December, following two months at 0.6%.

The latest surge in pandemic cases and the highest inflation in 40 years are taking a toll on American consumers, according to the University of Michigan consumer sentiment index for January. The sentiment index hit its lowest point since November 2011, with consumers indicating their greatest concern is that inflation will keep rising faster than their incomes.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13771, up 2 points or 0.0%

Standard & Poor’s 500 – 4432, up 34 points or 0.8%

Dow Jones Industrial – 34726, up 461 points or 1.3%

10-year U.S. Treasury Note – 1.78%, up 0.04 point

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Landaas & Company newsletter  January edition now available.

Advisors on This Week’s Show

Bob Landaas

Kyle Tetting

Brian Kilb

Paige Radke

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Jan. 17-21, 2022)

Significant Economic Indicators & Reports

Monday

Markets closed in observance of Martin Luther King Jr. Day

Tuesday

No major announcements

Wednesday

U.S. housing starts and building permits quickened pace in December, not as brisk as earlier in 2021 but still near their levels just after the 2006 housing bubble. The Commerce Department said the annual rate of housing starts exceeded 1.7 million units for the first time since March. Permits authorizing future construction rose to nearly 1.9 million, the most since last January. Critical construction of single-family houses, which could help alleviate ongoing supply issues for the housing market, continued to advance. In December, nearly 800,000 single-family residences were under construction.

Thursday

The four-week moving average for initial unemployment claims rose for the third week in a row after hitting its lowest level since 1969. Despite the recent uptick, the layoffs indicator shows employers remain reluctant to let workers go. The moving average of 231,000 claims was 38% below the all-time average dating back to 1967. The Labor Department reported 2.1 million ongoing claims for jobless benefits, up 9% from the week before, but down from 16.9 million the same time last year.

Full-year existing home sales reached the highest level since 2006. The National Association of Realtors said even though the pace of sales slowed in December, the full 2021 count of 6.12 million houses sold was up 8.5% from 2020. Sales rose as supply dwindled to 910,000 houses on the market at the end of December, the lowest inventory in 22 years of records. As a result of low supply and ongoing demand, the median sales price jumped, for the 118th month in a row, rising 15.8% from December 2020 to $358,000. An economist for the Realtors said rising mortgage rates will increasingly curb the enthusiasm of home buyers, but that should also help inventory increase, thus moderating price gains.

Friday

The Conference Board said its index of leading economic indicators rose 0.8% in December following 0.7% gains in both November and October. The slight acceleration suggests continued economic expansion into the first quarter of 2022, according to the business research group. Despite resistance from the omicron COVID variant, the tight labor market, inflationary pressures and expected interest rate increases, the Conference Board said the U.S. economy should grow at a 2.2% annual rate in the first quarter and 3.5% for all of 2022. The full-year growth rate would be both “robust,” the group said, and well above trends before the pandemic.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13769, down 1125 points or 7.6%

Standard & Poor’s 500 – 4398, down 265 points or 5.7%

Dow Jones Industrial – 34266, down 1646 points or 4.6%

10-year U.S. Treasury Note – 1.75%, down 0.03 point

Send us a question for our next podcast.

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Landaas & Company newsletter  January edition now available.

Advisors on This Week’s Show

Bob Landaas

Kyle Tetting

Art Rothschild

Mike Hoelzl

(with Max Hoelzl and Joel Dresang, engineered by Jason Scuglik)

Week in Review (Jan. 10-14, 2021)

Significant Economic Indicators & Reports

Monday

No major announcements

Tuesday

No major announcements

Wednesday

The broadest measure of inflation showed prices rising at the fastest annual pace since 1982. The Consumer Price Index rose 7% in the 12 months since December 2020, though the 0.5% gain from November was the lowest in three months. A 50% year-to-year increase in gasoline prices contributed to high inflation, as did a 37% increase in used vehicle prices. The Bureau of Labor Statistics said gas prices declined from November. The core CPI, which excludes volatile prices for food and energy, rose 5.5% from December 2020, the largest increase since 1991.

Thursday

The four-week moving average for initial unemployment claims rose for the second week in a row after hitting its lowest point since 1969. Considered an indicator of layoffs, the average reached 210,750 claims in the latest week, which was 43% behind the average since 1967 and down from a record high of 5.3 million in April 2020. The Labor Department said 1.9 million Americans claimed jobless benefits the week of Christmas, the latest date available. That was up 13% from the previous week but down from 19.4 million the year before.

The Bureau of Labor Statistics showed wholesale inflation remained high in December, although there were some hints that it might be easing. The Producer Price Index rose 0.2% in December, down from a 1% gain in November and the smallest increase in 13 months. The year-to-year inflation rate was 9.7%, down from 9.8% in November, the highest in 10 years of data. The price index for goods fell for the first time since April 2020, led by a 6% decline for gasoline. Excluding volatile prices for energy, food and trade services, the so-called core PPI rose 0.4% from November and gained 6.9% from December 2020. The one-year rate was unchanged from November and up from 1.3% in 2020.

Friday

Facing surges of inflation and COVID-19, and following earlier-than-usual shopping to combat supply-chain delays, retail spending declined 1.9% in December. The drop-off was widespread. Ten of 13 retail categories posted lower revenue in December, the Commerce Department reported. Compared to the year before, retail spending rose 16.9%. It was up 19.2% since the pandemic began, resulting in a monthly average of 0.9%, more than double the monthly rate of retail spending movement in the previous 20 years.

The Federal Reserve said industrial production contracted by 0.1% in December, the first decline in three months. Production was up 3.7% from December 2020 and 0.6% ahead of its level just before the pandemic. Manufacturing output fell 0.3% from November, including a 1.3% setback in automotive manufacturing. Utilities’ output declined because of unseasonably warm weather, while the mining sector grew through expanded oil and gas production. Capacity utilization, a measure of potential inflation, fell to 76.5%, compared to a 50-year average of 79.6%.

A preliminary December reading of consumer sentiment resulted in the second-lowest level in a decade, according to the University of Michigan. The survey-based index dropped to 68.8 from 70.6 at the end of December. The index hit a 10-year low of 67.4 in November. An economist with the survey cited the omicron COVID variant and inflation as reasons for consumers’ gloomier outlooks. One third of respondents said their finances were worse than the year before, which was only slightly higher than in April 2020, at the onset of the pandemic and lockdowns.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 14894, down 42 points or 0.3%

Standard & Poor’s 500 – 4663, down 14 points or 0.3%

Dow Jones Industrial – 35911, down 320 points or 0.9%

10-year U.S. Treasury Note – 1.77%, unchanged

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Landaas & Company newsletter  January edition now available.

Advisors on This Week’s Show

Kyle Tetting

Steve Giles

Chris Evers

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Jan. 3-7, 2022)

SIGNIFICANT ECONOMIC INDICATORS & REPORTS

Monday

Housing helped U.S. construction spending rise in November for the eighth time in nine months. The Commerce Department said construction expenditures rose 0.4% to a record annual rate of $1.63 trillion. Spending on residential construction rose 1.2% from the October rate and 16.1% from November 2020. Excluding housing, construction spending declined 0.3% from October and was down 3.3% from the year before.

Tuesday

The Institute for Supply Management reported that its manufacturing index signaled expansion in December for the 19th month in a row, although at the slowest pace since last January. Based on surveys of purchasing managers, the index showed most components growing at a reduced rate, but hiring rose faster. Survey respondents said demand for goods remained strong while supply chains continued to bottleneck. The trade group said the index suggests annual U.S. economic growth of 4.4%.

A record number of U.S. employees quit their jobs in November, as demand for workers continued to far outstrip the number of job seekers. The Bureau of Labor Statistics said 4.5 million workers quit their jobs, which suggests they’re confident of finding better positions. At the same time, employers posted 10.6 million job openings, down 4.8% from October but up 56% from the year before. The margin between openings and unemployed job seekers grew to 3.7 million.

Wednesday

No significant reports

Thursday

A report from the Commerce Department showed manufacturing orders gaining in November for the 18th time in 19 months. The value of orders rose 1.6% from October and was 17% ahead of November 2020. Excluding volatile orders for transportation equipment, orders rose 0.8% for the month and 14% from November 2020. A proxy for business investments was up 15% from the year before.

The four-week moving average for initial unemployment claims rose slightly but remained near a half-century low. Average claims were at 204,500, which was 2% below the low level just before the pandemic. The Labor Department said 1.7 million Americans were claiming unemployment benefits in the latest week, down 10% from the week before. A year ago, more than 20 million dislocated workers claimed benefits.

The U.S. trade deficit widened by 19% in November. The $80.2 billion deficit, which detracts from gross domestic product, resulted from the value of imports rising at a faster rate than exports. Imports were up 4.6% from October, while exports rose 0.2%. Year to year, the trade gap rose 29% to nearly $175 billion.

The U.S. services sector kept growing in December, though at a slightly slower rate after a record pace in November, according to the Institute for Supply Management. The trade group’s services index showed the 19th consecutive month of growth following setbacks in April and May of 2020. The pace of expansion slowed for most components of the index, but inventories shrank and prices rose at a faster pace.

Friday

U.S. employers added 199,000 jobs in December, about half as much as analysts expected. The gain compared to a monthly average of 537,000 in 2021, according to the Bureau of Labor Statistics. The job level remained 3.6 million or 2.3% below where it was in February 2020. Leisure and hospitality employers continued to add the most jobs, though they had 1.2 million, or 7.2%, fewer jobs than when the pandemic began. The same report showed the unemployment rate dropping to 3.9%, the lowest since 3.5% in February 2020. Of 5.7 million people not in the labor force but wanting a job, 1.1 million reported that the pandemic was preventing them from seeking a job.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 14936, down 709 points or 4.5%

Standard & Poor’s 500 – 4677, down 89 points or 1.9%

Dow Jones Industrial – 36232, down 107 points or 0.3%

10-year U.S. Treasury Note – 1.77%, up 0.26 point

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Landaas & Company newsletter  December edition now available. Advisors on This Week’s Show Kyle Tetting Art Rothschild Paige Radke (with Max Hoelzl, Joel Dresang, engineered by Chris Evers) Week in Review (Dec. 27-31, 2021) Significant Economic Indicators & Reports Monday No major releases Tuesday Housing prices continued to track much higher than overall inflation in […]

Landaas & Company newsletter  December edition now available. Advisors on This Week’s Show Kyle Tetting Brian Kilb with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik Week in Review (Dec. 20-24, 2021) Significant Economic Indicators & Reports Monday The Conference Board’s index of leading economic indicators rose 1.1% in November, advancing from gains of 0.8% […]