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February 12 , 2018
Statistic of the Week: 
Over a trillion plastic bags are used every year. Americans use enough to stretch around the world 1,330 times annually. In Great Britain, supermarkets will charge for the use of plastic bags starting Monday.
Global Perspective: 
In Atlanta, it appears that the 12 nations working on the Trans-Pacific Partnership are coming to agreement. The treaty will lower trade barriers on trade covering about two-fifths of the global economy. The biggest hurdle the accord will face is ultimate approval by national legislatures.
Market Moving Events: 
Monday: ISM Non-Manufacturing Index Tuesday: International Trade Wednesday: Petroleum Status Report Thursday: Jobless Claims, FOMC Minutes Friday: Import Export Prices
We can say “good riddance” to the third quarter. Over the period, the S&P 500 dipped around 6%,1 but showed relative outperformance to other global indices.2 For American equity markets, it was the worst quarterly performance figure since 2011.3 Last week, however, markets showed some strength. The S&P rallied 1.10%,4 while the DJIA rose 1.00%.5 More importantly, the yield on the 10-year Treasury fell below 2%, closing the week at 1.99%.6 Investors appear to have little appetite for risk. Crosscurrents abound. Many are asking whether or not the Federal Reserve has backed itself into a corner in terms of its ability to raise interest rates. Just as Chair Janet Yellen indicated that it was probable that we would see a rate hike by the end of the year, we have seen some economic data, like last week’s jobs’ figure (chart right), soften. The employment data is particularly worrisome. The economy has been expanding for six years since the recession ended, and touting the strength of the labor markets has been a constant. With the labor participation rate falling to 62.4%,7 lows not seen in 38 years,8 it is hard to argue that the labor markets are standing on steady ground. Weak international markets are being blamed for the slowdown. Nevertheless, a weakening domestic employment situation makes it difficult for the Federal Reserve to take any action that would be deemed “hawkish.” It looks like the doves may be safe for now. - Dan McElwee, CFP®
Chart of the Week: 
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