February 2019

“All you need is love.  But a little chocolate doesn’t hurt now and then.”

– Charles Shultz

Valentine’s Day is a day of love and romance, a day of hearts and chocolate.

Valentine’s Day is also a day of surprises (“OH NO, it’s today?!?”), followed by the joy of shopping for Someone Special…at CVS on the way home from work.

Valentine Bear

Taking Stock

Valentine’s Day is also known as a “Hallmark Holiday”.  February 14th represents another hallmark: 10% of the stock market year is now in the books.  With approximately one-tenth of the year now behind us, let us look at 2019, so far, and see how things are going.  Mostly the markets have given us hearts and flowers.

Asset Performance In the First Tenth of 2019

Dow Jones Industrial Average 

  • Opening Price, January 2, 2019: $23,058.61
  • Closing Price, February 13, 2019:  $25,543.27
  • Net Change: +10.77%

S&P 500 Index

  • Opening Price, January 2: $2,476.96
  • Closing Price, February 13: $2,753.03
  • Net Change: +11.14%

10 year Treasury Bond Yield

  • Opening yield, January 2: 2.65%
  • Closing yield, February 13: 2.66%
  • Net Change:  +.01%

Gold

  • Opening price, January 2:  $1,297
  • Closing price, February 13: $1,306.75
  • Net Change: +.7%

NASDAQ

  • Opening Price, January 2: $6,506.91
  • Closing Price, February 13:  $7,420.38
  • Net Change: +14.03%

It really is a Hallmark Holiday

According to the Greeting Card Association, more than 145 million Valentine’s cards will exchange hands in America this year, and most of those cards are made by Hallmark. Because Hallmark is a family-owned business (founded by Joyce Hall in 1910) the company doesn’t publish sales numbers, but apparently the business model is still working.  In a CNBC interview, Hallmark’s chief marketing officer noted that eCards haven’t disrupted the printed card business.  In today’s world of electronic communications, paper greeting cards deliver a unique “tactile experience”.

Comment:   More than 1,400 Hallmark Valentine’s Day cards will be in circulation this year.

Bears make money, Bulls make money…Happy Chinese New Year!

Valentine Pig

February is known for special days.  We have Groundhog Day (forecasting an early spring this year), President’s Day (Washington and Lincoln) and Superbowl Sunday (Tom Brady Day).

This year, February 5th was Chinese New Year’s Day, officially kicking-off “The Year of the Pig.”

The Year of the Pig rolls around every twelfth year, according to the Chinese Zodiac.  Always looking for stock market signs in the stars, we decided to research the performance of the S&P 500 Index during the last eight Years of the Pig, just to see how the markets have performed during that sign of the Chinese Zodiac.  We’re not superstitious, but….

(Returns for the S&P 500 index, including dividends.)

The Years of the Pig

1923 +5.45%

1935 +54.93%

1947  +2.56%

1959  +11.59%

1971  +14.54%

1983  +23.13%

1995  +38.02%

2007  +5.46%

2019….?

Comment:  Rethinking the old Wall Street axiom, “Bulls make money, bears make money, pigs never do.”

Another Comment: Of the twelve astrological signs in the Chinese Zodiac, only one other sign besides the Pig has a perfect positive century-long record (including dividends) tracking the S&P 500 Index: the Rabbit, which comes up again in 2023.

Valentine’s Day Spending

 

According to the National Retail Federation, fewer adults will spend money on Valentines this year, dropping from 60% of U.S. adults in 2009 to around half this year.  The Federation polled non-spending consumers, who find Valentine’s Day “over-commercialized, don’t have anyone to celebrate with or simply aren’t interested anymore.”  Those who do spend are spending more:  the average gift has increased by $60 since 2009.  Valentine’s Day spending is expected to top $20 billion this year – a new record.

Comment:  CVS is open til 10PM.

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