Market News – Week of June 19th, 2017

FED SURPRISES NO ONE…RAISES RATES:

The Federal Reserve raised interest rates another quarter of a percentage point last week.  The target range for the federal funds rate increased to 1% to 1.25%.

…BUT MORTGAGE RATES GO DOWN:

According to Mortgage News Daily, this past week mortgage rates in the U.S. hit their lowest level in 8 months!   These rates lowered dramatically after the latest U.S. Consumer Price Index came in at 1.7%, lower than expected.  The Fed stated that it believes that inflation is being held at this low level by temporary factors.  Banks evidently don’t agree.

EMPLOYMENT NUMBERS CONTINUE TO BE HEALTHY:

In the week ending June 10, 237,000 initial unemployment claims were filed, a decrease of 8,000 from the previous week. The 4-week moving average was 243,000, an increase of 1,000 from the previous week’s unrevised average of 242,000.

LITTLE MOVEMENT:

For the week, the S&P 500* slightly increased 0.03% (up 8.62% for the year).  The MSCI All Country X US* increased 0.08% (up 14.33% for the year).  The Barclays Global Aggregate Bond Index* increased by 0.26% (up 4.66% for the year).  The HFRX Global Hedge Fund Index* decreased 0.23% (up 2.34% for the year).

BE GRATEFUL:

The average American lives on $90 per day.  Approximately 40% of the world’s population lives on less than $2.00 per day, and about 1 billion of those people live on less than one dollar per day.

THE SEVEN PERCENT:

According to a recent survey by the Innovation Center for U.S. Dairy, 7% of U.S. adults (18 years of age and older) believe that chocolate milk comes from brown cows.

References:

THE SEVEN PERCENT: http://hotair.com/archives/2017/06/15/endgame-seven-percent-americans-think-chocolate-milk-comes-brown-cows/
FED SURPRISES NO ONE:  http://www.calculatedriskblog.com/2017/06/fomc-statement-25bps-rate-hike.html
…BUT MORTGAGE RATES GO DOWN:  http://www.mortgagenewsdaily.com/consumer_rates/746937.aspx
BE GRATEFUL:  When Helping Hurts, by Corbett and Finkert, 2012, at page 41
EMPLOYMENT NUMBERS CONTINUE TO BE POSITIVE:  http://www.calculatedriskblog.com/2017/06/weekly-initial-unemployment-claims_15.html