Economic Update, June 19, 2017

Phillip Allen Inc.





“We learn by example and by direct experience because there are real limits to the adequacy of verbal instruction.”

– Malcolm Gladwell

Do you have a child heading off to college this fall? Financially, it may be time for his or her first credit card. One idea: have your son or daughter sign up for a basic, low-limit card through a credit union or independent bank and have the monthly statements sent to you.

What are you able to keep after you give it to someone?
Last week’s riddle:
I often stand straight and tall. I can illuminate your wall or hall. If you push me, I may fall. What am I?
Last week’s answer:
A candle.






June 19, 2016


As Wall Street anticipated, the Federal Reserve raised interest rates on June 14. The Federal Open Market Committee voted 8-1 to take the benchmark interest rate north by a quarter-point to the 1.00-1.25% range. The Fed also said it would begin to reduce its $4.5 trillion balance sheet at some point “this year” by slowing reinvestments. As a start, it will let $6 billion per month in Treasury holdings run off, along with $4 billion per month in agency debt and mortgage-linked securities. This implies upward pressure on long-term interest rates.1,2
The Consumer Price Index declined 0.1% in May, noted the Bureau of Labor Statistics; core consumer inflation rose 0.1%. A bigger May decline came for retail purchases – the Census Bureau said that they fell 0.3% even with car sales factored out.3
The Census Bureau’s new residential construction snapshot showed groundbreaking at an 8-month low, with total housing starts down 5.5% in May. Total building permits decelerated 4.9% last month to their slowest pace since April 2016.4
In its preliminary June edition, the University of Michigan’s consumer sentiment index fell short of expectations. Economists, polled by, forecast a reading of 97.0 for the index, but it came in at 94.5.3
Rising 0.53% in five days, the Dow Jones Industrial Average ended the week at 21,384.28. The S&P 500 made a weekly advance of 0.06% to a Friday close of 2,433.15. Tech shares kept selling off, resulting in the Nasdaq Composite’s 0.90% weekly descent to a Friday settlement of 6,151.76. The Dow Jones Utility Average had the best week among consequential U.S. equity indices, rising 1.75%.5
THIS WEEK: Nothing major is scheduled for Monday. Tuesday, Adobe Systems, FedEx, La-Z-Boy, Lennar, and Red Hat all present earnings. Wednesday offers May existing home sales figures and earnings announcements from CarMax, Oracle, and Winnebago. Earnings news from Accenture, Barnes & Noble, Bed Bath & Beyond, Carnival, and Sonic arrives Thursday, plus new initial jobless claims numbers. Friday, investors consider May new home sales and Q2 results from Finish Line.

DJIA 8.21 20.59 13.5 5.68
NASDAQ 14.28 26.97 22.83 13.42
S&P 500 8.68 17.09 16.24 5.87
10 YR TIPS 0.49% 0.15% -0.54% 2.73%


Sources:,, – 7/8/166,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.



Please feel free to forward this article to family, friends or colleagues.
If you would like us to add them to our distribution list, please reply with their address.
We will contact them first and request their permission to add them to our list.



 This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.



1 – [6/14/17]
2 – [6/14/17]
3 – [6/16/17]
4 – [6/16/17]
5 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
6 – [6/16/17]
7 – [6/16/17]
8 – [6/16/17]


Submit a Comment

Your email address will not be published. Required fields are marked *

We are an independent financial services firm helping individuals create retirement strategies using a variety of investment and insurance products to custom suit their needs and objectives.

Securities and advisory services offered only by duly registered individuals through Madison Avenue Securities LLC, member FINRA/SIPC and a Registered Investment Advisor. MAS and Phillip Allen Inc., Common Sense Retirement Planning or Tony Dale, Inc are not affiliated entities.

Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. None of the information contained on this website shall constitute an offer to sell or solicit any offer to buy a security or any insurance product.

*Any references to protection benefits or steady and reliable income streams on this website refer only to fixed insurance products. They do not refer, in any way, to securities or investment advisory products. Annuity guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. Annuities are insurance products that may be subject to fees, surrender charges and holding periods which vary by insurance company. Annuities are not FDIC insured.

The information and opinions contained in any of the material requested from this website are provided by third parties and have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. They are given for informational purposes only and are not a solicitation to buy or sell any of the products mentioned. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual's situation.