Weekly Economic Update

Posted on January 22, 2015 by LSAConnect

Economic Update 1-22-2015

  • In a full week of economic releases, retail sales were somewhat disappointing (although cheap gasoline exacerbated the poor result), inflation declined dramatically due to cheaper energy costs, while sentiment improved to much higher levels.
  • Domestic equity markets were weaker, while foreign names generally experienced positive sentiment from Europe. Bonds gained ground on continued declines in yield, which also benefitted REITs to some degree.  Oil prices stabilized somewhat at just under $50/barrel.

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LSA Portfolio Revisions

Posted on January 15, 2015 by LSAConnect

 

** TRADE DATE SCHEDULED FOR Thursday, January 15th, 2015! **

Jackson National VA – Posted

Jackson Nation Elite Access – Posted

ING VUL – Posted

ING GoldenSelect – Posted

ING Select Advantage – Posted

Jefferson National – Posted

Protective Life – Posted

 

** TRADE DATE SCHEDULED FOR Friday, January 16th, 2015! **

(Trade sheets will be posted on Thursday)

Hartford

Lincoln

Nationwide

 

If you have any questions please feel free to contact us at support@LSAportfolios.com or call us at (866) 581-5724.  We will be addressing the remaining VA allocations in the coming days and will also be addressing the dropbox revisions to rider restricted portfolios over the weekend as well.

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Chart of the Week: Lowest Deficit in US Since 2007

Posted on January 15, 2015 by LSAConnect

Chart of the Week: Closing the Gap?

Deficit

A $2 billion surplus capped off a year that ended with the smallest deficit in the US since 2007, which preceded the $800 billion spending stimulus that started the Obama era. During this time, the deficit soared to 10% of GDP, the highest since WWII. It now sits at a more comfortable 3%, a stat that policy makers are waving proudly. Although this is a step in the right direction, what is not being brought to attention is that total national debt is still over $18 trillion dollars (101% of GDP) and growing. A reduced deficit is still a deficit, meaning the national debt is still increasing, albeit at a slower annual rate. And with the debt ceiling set to be reinstated March 16th of this year, a troublesome spring may be looming.

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Weekly Economic Update

Posted on January 12, 2015 by LSAConnect

Economic Update 1-12-2015

  • The economic news of the week was led by a somewhat disappointing ISM non-manufacturing report early, Fed minutes that were largely as expected and a mixed employment report with stronger payrolls but weaker wage growth.
  • Equity markets lost ground globally, while bonds of all types earned positive returns, as did real estate. Oil prices slipped again and closed under $50/barrel—one of the most closely watched items in recent months.

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Chart of the Week: Passive over Active?

Posted on January 9, 2015 by LSAConnect

Chart of the Week: Risks of Index Investing

PIMCO_Viewpoint_Moore_Spalding_Dec2014_Fig1

With the industry buzzing about the shortcomings of active management, it has never been more important to make clients fully aware of the risks of passive investing. This chart shows that, since the 2008 financial crisis, duration has increased about 50% in the Barclays US Aggregate Index, leaving passive fixed income investors historically more vulnerable to interest rate risk. The fall in yield during that time period from around 4% to around 2.2% also means their compensation for this added risk is limited. Do not forget that your clients’ assets need to be managed to a certain level of risk, and passive investing has no such parameters. It is not about what you make, it is about what you keep.

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Weekly Economic Update

Posted on January 6, 2015 by LSAConnect

Economic Update 1-5-2015

  • The most closely-watched economic releases were the ISM Manufacturing survey and Chicago PMI, which fell from last month and under expectations. Housing/construction data was mixed, while consumer confidence was a bit better.
  • Ending the year, both U.S. and developed foreign equities fell, while emerging market stocks and real estate gained. Investment-grade bonds generally gained, while crude oil led commodities down for yet another week.

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LSA Portfolio Revisions

Posted on January 5, 2015 by LSAConnect
LSA will be making changes to all of our models over the next two weeks. The Mutual Fund and ETF portfolios will be traded this week (Jan 8th/9th, details below) and the VA/VUL revisions will post and trade the week of the January 12th.

Many of the revisions have already been posted online, please make sure to go to the LSA website and login with your access codes to view the specifics.

Please find the information for portfolios to post and dates of revisions below.

** TRADE DATE SCHEDULED FOR Thursday, January 8th, 2015! **

Private Client
PC Traditional
PC Blended
Bear Market Entry
Cautious Bear Plus
ETF Strategic
ETF Tactical
PC L100K
PC Tax Efficient
Schwab NTF

** TRADE DATE SCHEDULED FOR Friday, January 9th, 2015! **

To be Posted on Tuesday (January 6th):
American Funds
DFA
ETF NTF
Fidelity
Socially Responsible

If you have any questions please feel free to contact us at support@LSAportfolios.com or call us at 866-581-5724.
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2015 LSA Market Outlook

Posted on January 5, 2015 by LSAConnect

2015 LSA Market Outlook:

 lsa

LSA has posted our 2015 Market Outlook video and presentation:

These views represent the opinion of the Asset Allocation Committee and are informed by subjective assessment of the relative attractiveness of asset classes and subclasses over a 6- to 18-month time horizon. The approach is largely qualitative and valuation based, with attention to a broad scope of potential risks and potential return scenarios.

To view the video presentation: you will need to login to the LSA website and go to “Training/Economic Update”.

To view the 2015 LSA Outlook report: go to “Resources/Articles”.

If you are not a member but would like to view these reports and presentation e-mail us at support@lsaportfolios.com .

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Chart of the Week: Pre-Election Year Historically Positive

Posted on January 2, 2015 by LSAConnect

Chart of the Week: Pre-Election Year Historically Positive

Use this one

The chart shows the average trend of the DIJA for each period of the 4 year election cycle from 1897-2011. By far the best year, on average, has been the “pre-election” year, which is, of course, the year we are entering into now. During this period, administrations typically have a habit of going to greater measures to stimulate the economy so that voters go to the polls with positive feelings towards the state of the economy. This has historically boded well for the stock market. In fact, since the end of World War II, 94% of the pre-election years were positive.

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Weekly Economic Update

Posted on December 29, 2014 by LSAConnect

Economic Update 12-29-2014

  • During the holiday-shortened trading week, we received some upbeat economic news: The Q3 real GDP growth rate was revised up significantly more than expected, consumer confidence reached the highest level in eight years, and seasonally adjusted initial jobless claims continued to edge downward.
  • Amid positive economic developments, we saw a slightly disappointing durables report, some softness in the housing data and limited personal income growth versus the pace of consumer spending.
  • A strong GDP report helped fuel last week’s Santa Claus rally.  Domestic stocks continued to swing up while the Dow topped 18,000 for the first time.  Foreign stocks slightly lagged behind, bonds retreated, REITs’ performance was up more than 1%, and commodities were down for the week.

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Chart of the Week: Happy Holidays for the US Economy?

Posted on December 24, 2014 by LSAConnect

Chart of the Week: Percent Change in Retail and Food Services Sales

Retail_Sales_Beat_Expectations-

Percent Change in Retail and Food Services Sales 2014 Source: US Census Bureau

Coinciding with other recent positive economic data reports, total US retail sales showed a year-over-year increase of a robust 5.1 percent. This is highlighted by a month-over-month rise of 0.7 percent in November, beating what many forecast to be only 0.4 percent. Positive retail sales are typically a good indication of consumer spending being on the rise, which accounts for over two thirds of GDP. And since November retail sales historically set the trend for what’s to come in December, oil prices continue to drop, and wage growth is slowly starting to gain strength, the US economy seems poised to have happy holidays ahead.

 

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Weekly Economic Update

Posted on December 22, 2014 by LSAConnect

Economic Update 12-22-2014

  • Last week’s domestic economic data were mixed.  Good news came from the stronger industrial production report in November and lower than expected jobless claims.
  • Disappointing news came from December’s Empire manufacturing report, slightly worse than expected housing market data and November’s soft CPI report.
  • Stocks rebounded significantly from the prior week’s slump, as depressed energy prices showed some signs of stabilization, the U.S. economy continued to strengthen, and the Fed expressed patience regarding the timing of rate liftoff.  However, bond performance was muted.  REITs delivered small positive returns that were offset by negative performance from the commodity markets.

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