Womack
Weekly Commentary
May 21,
2018
The
Markets
Too much? Too little? Or just right?
U.S.
stock markets were relatively calm, although they finished the week lower. U.S.
Treasury yields hit a 7-year high and finished the week above 3 percent. While these
were notable, the most remarkable events last week occurred beyond our borders.
These include:
·
The Vatican publishing a position paper on financial
markets. Its opening was, “Economic
and financial issues draw our attention today as never before because of the
growing influence of financial markets on the material well-being of most of
humankind. What is needed, on the one hand, is an appropriate regulation of the
dynamics of the markets and, on the other hand, a clear ethical foundation that
assures a well-being realized through the quality of human relationships rather
than merely through economic mechanisms that by themselves cannot attain it.”
·
The royal wedding boosting the British economy. A normal Britain wedding costs about £18 thousand and
includes about 80 guests. Prince Harry’s nuptials were a bit more lavish. A
wedding planning company estimated the cost of hosting 600 or more guests at
£32 million ($43 million in U.S. dollars). The largest component of the cost
was £30 million for security, which included drone destroyers.
·
Venezuela’s oil-based economy continuing to collapse
as oil prices rise. “Venezuela leads
the world in two things: oil reserves and incompetence,” opined The Washington Post. Poor management of
the state-run oil industry has caused production to drop 23 percent since
December. The country’s declining production helped push oil prices higher last
week. Prices are at levels last seen in 2014, reported Financial Times. Regardless of the country’s economic woes, this
weekend’s election is not expected to oust President Nicolás Maduro.
Rising
oil prices have pushed the cost of gas higher, but that’s not expected to deter
Memorial Day travelers, according to USA
Today. We wish you safe travels during the holiday weekend.
Data as of
5/18/18
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
|
Standard & Poor's 500 (Domestic Stocks)
|
-0.5%
|
1.5%
|
14.7%
|
8.4%
|
10.2%
|
6.6%
|
|
Dow Jones Global ex-U.S.
|
-0.9
|
-0.5
|
11.9
|
2.7
|
3.2
|
-0.2
|
|
10-year Treasury Note (Yield Only)
|
3.1
|
NA
|
2.2
|
2.2
|
2.0
|
3.8
|
|
Gold (per ounce)
|
-2.7
|
-0.6
|
2.6
|
1.7
|
-1.0
|
3.6
|
|
Bloomberg Commodity Index
|
0.4
|
2.5
|
8.4
|
-4.9
|
-7.4
|
-8.3
|
|
DJ Equity All REIT Total
Return Index
|
-3.0
|
-6.5
|
-0.4
|
4.3
|
4.8
|
5.9
|
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg
Commodity Index returns exclude reinvested dividends (gold does not pay a
dividend) and the three-, five-, and 10-year returns are annualized; the DJ
Equity All REIT Total Return Index does include reinvested dividends and the
three-, five-, and 10-year returns are annualized; and the 10-year Treasury
Note is simply the yield at the close of the day on each of the historical time
periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com,
London Bullion Market Association.
Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not
applicable.
did you know there’s a billionaire
census? Last week, the fifth edition
of the Billionaire Census was
released. Apparently, the wealth of billionaires increased by 24 percent during
2017. In addition, the billionaire population, which had suffered reduced
numbers since 2015, expanded. It now includes 2,754 individuals. The previous
high was 2,473 in 2015. According to Wealth-X:
·
816 live in the
Asia-Pacific region
·
884 live in the
Americas
·
1,054 live in Europe,
the Middle East, and Africa
There
is a bit of disagreement about the size of the ‘Three-Comma Club’ and the rate
at which its wealth is increasing. In March 2018, Forbes reported there were “…2,208 billionaires from 72 countries
and territories including the first ever from Hungary and Zimbabwe. This elite
group is worth $9.1 trillion, up 18 percent since last year. Their average net
worth is a record $4.1 billion. Americans lead the way with a record 585
billionaires, followed by Mainland China with 373.”
Two hundred and fifty-six women made the list, including
42 new additions.
The
Giving Pledge is another exclusive group that some billionaires have joined. The
objective of the Pledge is to “…help address society’s most pressing problems
by inviting the world’s wealthiest individuals and families to commit more than
half of their wealth to philanthropy or charitable causes either during their
lifetime or in their will.”
As of February 2018, 175 billionaires from 22
countries had joined.
Weekly
Focus – Think About It
“Philanthropy
is almost the only virtue which is sufficiently appreciated by mankind.”
--Henry David
Thoreau, American essayist and naturalist
Best
regards,
Womack Investment Advisers, Inc.
WOMACK INVESTMENT ADVISERS, INC.
Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK 73013
California Office: 4660 La Jolla Village Dr., Ste. 100 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717
Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK 73013
California Office: 4660 La Jolla Village Dr., Ste. 100 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717
Website: www.womackadvisers.com
Womack Investment Advisers, Inc.
(WIA) is a registered investment adviser whose principal office is located in
Oklahoma. Womack Investment Advisers, Inc. is also registered in the State of
California, the State of Illinois, the State of Indiana, and the State of
Texas. WIA only transacts business in states where it is properly registered,
or excluded, or exempted from registration requirements.
P.S. Please feel free to forward this commentary
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* These views are those of Carson Group Coaching,
and not the presenting Representative or the Representative’s Broker/Dealer,
and should not be construed as investment advice.
* This newsletter was prepared by Carson Group
Coaching. Carson Group Coaching is not affiliated with the named broker/dealer.
* Government bonds and Treasury Bills are guaranteed
by the U.S. government as to the timely payment of principal and interest and,
if held to maturity, offer a fixed rate of return and fixed principal
value. However, the value of fund shares
is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than
government bonds but normally offer a higher yield and are subject to market,
interest rate and credit risk as well as additional risks based on the quality
of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor's 500 (S&P 500) is an
unmanaged group of securities considered to be representative of the stock
market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. Unmanaged
index returns do not reflect fees, expenses, or sales charges. Index
performance is not indicative of the performance of any investment.
* The Dow Jones Global ex-U.S. Index covers
approximately 95% of the market capitalization of the 45 developed and emerging
countries included in the Index.
* The 10-year Treasury Note represents debt owed by
the United States Treasury to the public. Since the U.S. Government is seen as
a risk-free borrower, investors use the 10-year Treasury Note as a benchmark
for the long-term bond market.
* Gold represents the afternoon gold price as
reported by the London Bullion Market Association. The gold price is set twice
daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in
U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a
highly liquid and diversified benchmark for the commodity futures market. The
Index is composed of futures contracts on 19 physical commodities and was
launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures
the total return performance of the equity subcategory of the Real Estate
Investment Trust (REIT) industry as calculated by Dow Jones.
* Yahoo! Finance is the source for any reference to
the performance of an index between two specific periods.
* Opinions expressed are subject to change without
notice and are not intended as investment advice or to predict future
performance.
* Economic forecasts set forth may not develop as
predicted and there can be no guarantee that strategies promoted will be
successful.
* Past performance does not guarantee future
results. Investing involves risk, including loss of principal.
* You cannot invest directly in an index.
* Stock investing involves risk including loss of
principal.
* Consult your financial professional before making
any investment decision.
* To unsubscribe from the Womack Weekly Commentary
please reply to this email with “Unsubscribe” in the subject line or write us
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Sources:
https://www.ft.com/content/584a9610-5ab8-11e8-b8b2-d6ceb45fa9d0 (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/05-21-18_FinancialTimes-US_Stocks_Mixed_Treasuries_Rally_as_Markets_Eye_Trade_Talks-Footnote_1.pdf)
https://www.ft.com/content/1e4ae576-5ac4-11e8-b8b2-d6ceb45fa9d0 (or go
to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/05-21-18_FinancialTimes-The_Week_in_Energy-Regulations_Unintended_Consequences-Footnote_5.pdf)
https://www.ft.com/content/a4049438-5aa0-11e8-bdb7-f6677d2e1ce8 (or
go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/05-21-18_FinancialTimes-Disillusioned_Venezuelans_Set_to_Shun_Election-Footnote_6.pdf)
https://www.givingpledge.org/About.aspx (Click on “How many people
have joined the Giving Pledge, and where are they from?”)
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