Taking a look at a few strong economic indicators that point positively to the future with Wealth E&P
May 3, 2021
Welcome to Wealth Enhancement & Preservation’s Market Minute, where we get to update you on everything that happened in the markets this past week.
Last week was a week that ended flat. We had a spike mid-week Wednesday and Thursday, but Friday gave it back. The three indices all had just very minor gains and losses, so we will call that a flat week. Our signs are all still pointing very positive.
I want to talk about a couple of economic indicators today: income and spending. What we’ve seen is a real extreme spike, as you can see on the right side, in personal income. In fact, this is the largest spike ever.
There has been a 21% increase in income month-over-month and 23% to 24% year-over-year, as we recover from the pandemic over last year. However, spending or consumption isn't quite up as much, which is closer to 4%.
What does that mean when income goes up dramatically and spending not quite as much? With the ratio (historically, we spend about 90% of what we make), you can see the dip is recently down about 70%.
This is good because it means that people are saving money, putting it in the bank, and investing. All of that bodes well for the economy as we look ahead. As I mentioned, signs are still pointed positive, and we're going to stay aggressive, but we will let you know if that changes. Enjoy a good week!
If you have any questions for us about the financial markets, please feel free to reach out. Otherwise, stay tuned for our next Market Minute next week!
At Wealth Enhancement & Preservation, we are here to serve as your financial advisor and source of support. Our advisors are dedicated to simplifying the complexities of the financial world and as your advocate, we strive to learn about your most valued goals and dreams. From individual investors to entrepreneurs, our services are designed for your success.