Financial Expert Witness - Securities Expert Witness, FINRA Expert Witness
401k Consulting Minneapolis
Financial Road Map
Minneapolis Wealth Management | Minneapolis Investment Advisor

Recent Posts

December 5, 2019

November 7, 2019

September 13, 2019

Please reload

June Economic Update

June 7, 2019

 

 

Market Summary

As predicted in our last newsletter, the China trade dispute took center stage in and was the dominant market driver for the month of May. Hopes for a quick resolution to the U.S.-China trade dispute faded in early as discussions broke down and rhetoric from both sides turned tough again. The disappointment lingered on Wall Street and stocks retreated from their recent highs. On Main Street, consumer confidence was strong and inflation tame. Mortgage rates reached year-to-date lows, but the latest data on home sales showed weak spring buying. The price of crude oil fell significantly, and so did the yield on the 10-year Treasury reiterating concerns for many that economic conditions may be slowing. (1)

 

Trade, Trade, Trade

On May 5, President Trump announced that U.S. import taxes levied on $200 billion of Chinese products would soon rise from 10% to 25% and that virtually all other goods arriving from China would “shortly” face a 25% tariff. China retaliated, declaring that it would hike tariffs already imposed on $60 billion worth of American products. In the past week, President Trump announced proposed new tariffs on Mexican imports unless the country takes drastic measures to reduce illegal immigration into the United States. (2,3)

 

All of these developments caused weakness in an already over-bought market which had surged off of the December 24th lows, and during the month of May which historically has been known as a bearish period. It is important to note once again that the Chinese trade negotiations are controversial, both in political and economic contexts. However, if some type of trade reform is not established with the Chinese government, they will likely become the dominant global economic powerhouse commencing sometime within the next decade.

 

On the flipside of that statement, China's strategy is likely to "run out the clock" leading up to the next U.S. presidential elections, causing political harm to the President and potentially forcing him to cut a deal. The stakes are very high, and of course there is no way of predicting the outcome. 

 

Real Estate

The real estate sector, which is an important economic indicator, continues to show some relative weakness. While mortgage rates dropped to 3.99% in the last week of May, it did not help to spark resales of residential homes, which weakened by 0.4% and after a previous decline of 4.9% in March. New home buying also slowed 6.9% for the last reporting period of April. Homes are still appreciating, however, with the latest 20-city S&P/Case-Shiller home price index, which is the largest-watched indicator, printing a 2.7% gain for annual appreciation for the period ending March 2019. (2,3)

 

Looking Ahead…

As of the writing of this newsletter, the broad S&P 500 Index has already retraced close to 50% of the last month’s pullback. However, we expect continued "whipsaw" market action with large daily moves in the coming months. These moves will be headline driven, as was the case in May. Although risks have increased, we are still well off the lows made at the end of 2018 and remain in a large trading range. Many fundamental economic indicators remain strong and all eyes will be looking towards the Federal Reserve with hopes of interest rate cuts to spark another rally.

 

Monthly Financial Tip:

A will commonly needs to go through probate, and it can also be challenged during the probate process. On the other hand, if you transfer the title of certain assets you own into a properly written living trust, those assets can avoid probate after your death. Consult a trusted estate planning attorney to see if this would be a smart option for your estate. 

 

 

 

Citations

1 - barchart.com/stocks/indices?viewName=performance [5/31/19]
2 - investing.com/economic-calendar/ [5/31/19]
3 - freddiemac.com/pmms/archive.html [6/2/19]]

 

This post has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Bob Lawson is not engaged in rendering legal or accounting 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.

 

 

Please reload

Financial Plan | Personalized Report | Financial Advisor - Minneapolis

Barrington's Financial Blog

 About    |    Our Services    |    Financial Planning    |    Employer Retirement Plans    |    Contact

Litigation Support    |    Expert Witness    |    Pro Bono Services    |    Careers       

Barrington Capital Management, Inc.  |  3800 American Boulevard West  |  Suite 1110  |  Bloomington, MN  55431

952-835-1000   800-944-2419  |   Fax: 952-835-1504  |  Info@BarringtonCap.com

 

Barrington Capital Management, Inc. only conducts business in states and jurisdictions where it is registered or where an exemption from registration exists. This site and its contents do not constitute investment advice or a solicitation to sell securities. Past performance is not indicative of future results. This website is for informational purposes only and Barrington Capital Management, Inc. reserves the right to modify it at any time without notice. Copies of Barrington Capital Management Inc.’s Form ADV Part 2 are available upon request. Images and photographs are included for the sole purpose of visually enhancing the website. No photographs are of current or former clients and they should not be construed as an endorsement or testimonial from any of the persons in the photograph.

All materials used on this site, including all images, are copyrighted and are protected worldwide by copyright laws and treaty provisions. They may not be copied, reproduced, modified, published, uploaded, posted, transmitted, or distributed in any way, without Barrington Capital Management Inc.'s prior written permission.

Neither Barrington Capital Management, Inc., nor any of their Investment Adviser Representatives, provide tax or legal advice. Tax and legal advice should only be obtained from a qualified professional. All written content on this site is for informational purposes only. All information and ideas should be discussed in detail with an advisor prior to implementation. Examples from our news feeds, blogs or articles do not take into consideration commissions, investment management fees, miscellaneous transaction fees, tax considerations, or margin requirements, which are factors that may significantly affect the economic consequences of a given strategy. Investors should review transaction costs, margin requirements and tax considerations with their financial or tax advisor before entering into any investment or financial planning strategy. Material presented is believed to be from reliable sources; however, we make no representations as to its accuracy or completeness.

Investment Advisory services are offered by Barrington Capital Management, Inc., a Registered Investment Adviser in the states of Minnesota, California, Texas, and Wisconsin. Barrington Capital Management, Inc. may utilize the services of First Ascent Asset Management, LLC for certain investment portfolios. Insurance products and services are also offered through Barrington Capital Management, Inc. 

 

Disclosure: Barrington Capital Management, Inc. is not a law firm. Robert D. Lawson and his associates are not practicing attorneys. The scope of any activities performed by Robert D. Lawson, subcontractors or employees of Barrington Capital Management, Inc. is limited to litigation consulting and litigation support.​

By using this website, you agree to our Terms of Service and Privacy Policy.

Business Continuity Plan

Copyright © 2019 Barrington Capital Management, Inc.  |  A Registered Investment Adviser  |  All Rights Reserved

  

 Financial Advisor Minneapolis, MN