Latest Financial Economic News For Investors
Published Friday, September 3, 2021 at: 9:04 PM EDT
Savings, spending and employee compensation - key fundamentals driving U.S. economic growth - were all very strong in July, according to the latest government reports. However, today's announcement showing the economy created 235,000 new jobs last month was a disappointment.
Here are the highlights of the latest financial economic news.
Disposable personal income remained strong in July, as DPI surge from the third round of Covid relief checks to consumers is spent down and the extra unemployment benefits are no longer available.
Personal spending, however, has recovered to its pre-Covid trend pace. The savings rate, at 9.6%, is still elevated compared to before the pandemic.
Employee compensation, another key fundamental driver of U.S. economic growth, amounted to 61% of total personal income of Americans in July, despite the elevated post-Covid unemployment rate of 5.2%. With wages, salaries, and employee benefits growing by 9.4% in the 12 months ended July 31, 2021, employee compensation is back up to where it would have been if the pandemic never happened.
The unemployment rate ticked lower from 5.4% in July to 5.2% in August is good news, but unemployment is not a forward-looking indicator. The more revealing snapshot of the employment situation is net job growth, and that was a disappointment.
Today’s report that 235,000 new jobs were created in August was much lower than the estimate for 720,000 and far lower than the 1.05 million new jobs created in July. Jobs numbers are volatile, however, so it’s unwise to read too much into the disappointing report.
The Standard & Poor's 500 stock index closed this Friday at 4,535.43. The index lost -0.03% from Thursday, when it set a new all-time closing high. The stock index was up +0.57% from last week, and it has gained +67.86% since the March 23, 2020, bear market low.
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 a market-value weighted index with each stock's weight proportionate to its market value. Index returns do not include fees or expenses. Investing involves risk, including the loss of principal, and past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. This material represents an assessment of the market and economic environment at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. .
- The Good News Is All This Bad News
- Four Signs A Recession Could Be Short And Shallow
- Odds Of A Soft Landing Shrunk After Friday's News
- Bad Inflation Surprise Sends Stocks Down Sharply
- It Could Be A Long, Hot Summer For Investors
- What A Difference A Week Makes
- Amid Stock Market Turmoil, +2.3% Growth Projected In 2022
- Staying On Track Amid The Ukraine And Inflation Crises
- For Investors, 2022 Is Turning Into A Test
- Is The Economy Brightening? Or Is The Federal Reserve Slamming The Door On Growth
- Financial Economic News In Perspective
- Stocks Closed Lower This Week On Inflation Fears
- The Main Risk To Investors Now Is Federal Reserve Policy
- Service Sector Jobs Are Catching Up
- Stocks Returned +8.3% More Annually Than 90-Day T-Bills In Past 20 Years
- Perspective Amid A Moment Seeming Fraught With Investment Risk
- Two Years After The Pandemic Began
- Turning The Page On A Dark Period In History
- Russia-Ukraine War Erupted And Inflation Worsened But Outlook Drove Stocks Higher For The Week
- Investment Perspective Amid Risks Of Fed Tightening, Covid Variants, And European War
- S&P 500 Lost -1.9% Friday; Latest U.S. Economic Data Are Strong
- January Job Formation Figures Crushed Expectations, Amid A Shortage Of Workers
- S&P 500 Closed Up 2.4% Friday After A -10% Correction
- Stocks Declined Sharply, Even As Economists Expect 3% Growth In 2022