Wednesday, July 29, 2015

In The Things Are Getting Better Department



These two charts show the Civilian Unemployment Rate and the 4-Week Moving Average of Initial Jobless Claims.  As you can see both have plunged precipitously since the end of the last recession and both also continue to decline.  

We think numbers like these are important because they show that:

The economy continues to improve.  That's not only important for economic health but also for the health of the stock market.  

More people working means more people off of the government relief rolls.  That brings down the national debt.  Indeed in the last fiscal year the US had it's smallest national deficit since 2007 or before the last recession.

Working people in general are happier people that spend more money that's why we've seen a rise in consumer sentiment numbers in the past few months.  

Finally in regards to the markets, bull markets typically don't end during positive economic periods.  Stocks may have gone nowhere so far this year , but that may have more to do with other factors {valuation etc.} than an aging economy or consumer sentiment or  health.