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December Economic Update

The Markets & Economy

In November, the S&P 500 gained 2.81% and advanced for a thirteenth straight month – an unprecedented milestone in the index’s long history. Consumer confidence and investor confidence were both abundant as further evidence arrived that the economy was growing at an impressive rate.

Solid fundamental indicators, upbeat earnings announcements, and hopes for 2018 tax cuts motivated stock gains in the U.S.; though many foreign benchmarks slumped. Oil prices rose and home sales picked up after a late-summer lull. (1)

A December Federal Reserve rate hike seems a certainty to many investors. Given the growth rate in the second and third quarters, it raises the question whether the central bank will need to start tightening faster in 2018.

This current upward trending market has had help from low inflation as well as accommodative monetary policy. It would certainly get a tailwind, perhaps a strong one, from passage of federal tax reforms. While potential stock market hazards always lurk, Wall Street seems very confident heading into the holiday season. A great 2017 could precede solid gains in 2018. (1)

Year-End Charitable Gifting

Are you making charitable donations this holiday season? If so, you should know about some of the financial “fine print” involved, as the right moves could potentially bring more of a benefit to the charity and to you.

To deduct charitable donations, you must itemize them on I.R.S. Schedule A and you need to document each donation you make. Ideally, the charity uses a form it has on hand to provide you with proof of your contribution. If the charity does not have such a form handy (and some charities do not), then a receipt, a credit or debit card statement, a bank statement, or a cancelled check will have to suffice. The I.R.S. needs to know three things: the name of the charity, the gifted amount, and the date of your gift. (2)

Make sure your gift goes to a qualified charity with 501(c)(3) non-profit status. Also, visit CharityN