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December 4 , 2017
Statistic of the Week: 
In the past year, approximately 15% of working Americans (30 million) have sapped their retirement funds for an emergency. One in four workers between 20 and 60 have or will take a retirement plan loan prior to retirement. The main reason for these loans: many people neglect creating an emergency fund.
Global Perspective: 
The average American family will save $700 from the lower gasoline prices in 2015. (More than the “stimulus” package provided in 2008). Economists are having a difficult time tracking were this money is going. Some argue that consumers are saving the difference, some that debt is being paid down, and others argue that the funds are being spent as quickly as they come in.
Market Moving Events: 
Tuesday: Treasury Budget Wednesday: Producer Price Index, Retail Sales, Business Inventories, Beige Book Thursday: Jobless Claims, Consumer Price Index, Philly Fed Business Outlook Friday: Industrial Production, JOLTS, Consumer Sentiment, Treasury International Capital
Commentary: 
Global equity markets are trying to claw themselves out of a hole. The S&P 500 had a significant rally last week, climbing 3.30% and the DJIA moved right along with it, finishing the week up 3.77%.1 Year to date, both indices are still in the red, but the S&P is coming close to breakeven. The MSCI EAFE rocketed higher last week, gaining 5.36%, and pushing into the black for the year.2 While there was not much significant news to bolster the markets, a lack of selling pressure was a welcome relief for many. The rally in equities was mirrored by a minor selloff in the fixed income markets. The 10-year Treasury yield backed up from less than 2% to 2.12%.3 Debate abounds as to whether or not the “bottom is in” for the recent selloff in equities. This quarter’s earnings may have a lot to say about how markets finish off the year. Largely due to the energy sector, it is likely that the third quarter will show negative earnings growth (with the energy sector stripped out, analysts forecast that earnings growth would actually be positive).4 Analysts expect two consecutive quarters of negative earnings growth for the first time since 2009. A strong US consumer is alone carrying the weight of the world’s largest national economy. Consumer credit growth (chart right) correlates well with increases in personal consumption expenditures,6 and may be a signal that the consumer is ready to continue spending, even on a borrowed dime. Dan McElwee, CFP®
Chart of the Week: 
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