Watching the Tape: A random walk through recent economic, market and business headlines, Halloween Edition, 2015

“This Halloween the most popular mask is the Arnold Schwarzenegger mask. And the best part? With a mouth full of candy, you will sound just like him.” Conan O’Brien

It’s Party Time!

So what costume will you wear to the Halloween party this year?

According to experts, the most popular Halloween costumes for adults in 2015 are:

#1. Donald Trump
#2. Hillary Clinton
#3. Flo (from the Progressive Insurance ads)
#4. “Sith Lord” from Star Wars.

One of these comes from the Dark Side

The History

Historians tell us Halloween originated from an ancient Celtic festival called Samhain, in which people lit bonfires and wore costumes to ward off ghosts. Here’s how we got from Point A to Point B:

  • In the eighth century, Pope Gregory III designated November 1 as All Saints’ Day, a special day in honor of saints and martyrs.
  • The Pope tried to integrate Samhain’s pagan traditions into All Saint’s Day.
  • The night before All Saints’ Day was called All Hallows Eve.
  • All Hallows Eve became Halloween, which the Celts turned into a night to wear costumes and ward off ghosts.

The history is interesting, but for us Halloween is a reminder of the financial markets. This is because a) once every quarter we have “quadruple witching day” and b) the financial industry has its share of ghosts.

It is time, once again, for our Annual Halloween Dress-Up Like the Financial Markets costume recommendations!

Every October, we come up with a “short list” of financial stories – financial ghosts – from the past year that scared us half-to-death. Then, as a service to you the reader (no need to thank us), we try to design the appropriate Halloween costume for each financial ghost.

This year’s entries:

Ghost #1: The Dow Jones Industrial Average

The stock market scared us more than once this year, and especially on Monday, August 24, when it dropped 1,000 points at the opening bell. Longer term – going back to Halloween of last year – the Dow Average has merely drifted. Last Halloween the Dow closed at 17,390. As we pen these words, the Dow is around the same level.

Stock Market Costume: Wear the t-shirt below. To imitate the 2015 market at your Halloween party, walk sideways and fall down from time to time.

Ghost #2: The Chinese economic collapse

After years of hyper-growth, the Chinese economy paused in the summer of 2015, causing the Chinese stock market – then the world’s stock markets – to plummet. China has since taken measures to stimulate the economy, one of which is to de-value its currency, the Yuan.

Chinese Collapse Costume: Combine the Chinese Yuan with a Jedi Knight. Who are you?

Obi Yuan Kinobi!

Ghost #3: Federal Reserve Policy

Who is less scary than Janet Yellen? Known for her brilliant mind and calm demeanor, FOMC chair Yellen keeps a steady hand on the economy. Inflation is low and economic growth is around 2%. But something about Dr. Yellen haunts the stock market. Maybe it’s because she almost always wears black.

The Fed haunted the market twice this year. First haunting: In the Spring, Chairman Yellen promised to raise interest rates at the end of the summer. The stock market went down. Second haunting: The Fed didn’t raise interest rates at the end of the summer and the stock market went down.

Federal Reserve Costume: Professional grey haircut and all black clothes. We found a Janet Yellen mask online and frankly the picture is a little scary (the eyes!). This can be downloaded from The Daily Reckoning.

 Ghost #4: The Greek Economy

Greece scared the financial markets by first defaulting on debt, then by voting to thumb its national nose at creditors and the European Union. This ghost was all-Greek to world markets, which spent much of the summer bouncing around in fear of a Euro-collapse.

Greek Economy Costume: This one was a little tougher, and we settled on the Greek god Hermes. Hermes was the Greek god of commerce. According to Greek mythology, when Hermes was born, he jumped out of his crib, stole Apollo’s cattle, and then jumped back in the crib and pretended to be innocent. You get the idea.

Hermes Costume

 Ghost #5: The Bond Market Bubble

Mixing our holiday metaphors, the Bond Market Bubble may be a ghost of Halloween future. With interest rates near all-time lows, and the current Spirit of the Federal Reserve, the bond market is ripe for a sell-off…someday. Forecasters have been calling for the bond bubble burst for years, and it may not happen for years, or ever. But just in case…

Bond Market Bursts Costumes:

The Business of Halloween

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In September the National Retail Federation released its 2015 Halloween Consumer Spending Survey.

The Facts:

  • More than 157 million Americans plan to celebrate Halloween this year.
  • Spending will be down a bit. The average person celebrating will spend $74.34, compared with $77.52 last year.
  • Total spending on Halloween is expected to reach $6.9 billion in the U.S.
  • 68 million Americans will dress up this Halloween and another 20 million pet owners will dress up their pet.
  • The pet owners will spend $350 million on fashionable and fun costumes for their furry friends.
  • Nine in 10 (93.7%) of Halloween shoppers will buy candy, spending a total of $2.1 billion.
  •  Two in five celebrants (44.8%) plan to decorate their home or yard.
  • 41 percent of celebrants plan to carve pumpkins.
  • 31.4% of consumers will look for costume ideas online.
  • 13.3% will look for ideas on Pinterest.

Comment: Guessing none will get their costume ideas from Watching the Tape.

Watching the Tape is a compilation of news, observations and views written and edited by Bill Kibler, Senior VP, FinTrust Investment Advisors, bkibler@fintrustadvisors.com. Information is provided by sources believed to be reliable, but FinTrust is not responsible for accuracy. The information herein is not a recommendation to buy or sell any security. Past results are no indication of future performance.
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