Brexit: Wealth Economic Update Mar. 8, 2019

U.S. and World News

  • brexit-981577448_370British Prime Minister Theresa May traveled to Brussels again this week in a last-ditch effort to gain support from European Union leaders so that Britain can leave independent of European Union rules. Earlier this week Theresa May announced a plan that would provide $1.6 billion in funding to boost economic growth in the more indigent areas of the U.K., some say this is an attempt to buy votes and to pick up any leftover potential supporters that may remain. Theresa May has a chance of getting her Brexit deal passed if the Irish border impasse is resolved, however, this remains a significant impasse. It is predicted that there will be an extension and that Theresa May will have a deal passed by next month. The Prime Minister spoke today, stating that there is a chance that Britain may not leave the European Union at all.


Markets

  • Stocks retreated this week after having the best start to the year since 1991. The S&P 500 fell 2.12% and closed at 2,743. The Dow Jones dropped 2.17% and closed at 25,450. Year to date, the S&P is up 9.87% and the Dow Jones is up 9.66%.
  • Yields plummeted this week as investors piled into bonds. The 5 year and 10 year U.S. Treasury Notes are yielding 2.43% and 2.63%, respectively.
  • The spot price of WTI Crude Oil rose slightly this week. Prices rose 0.32% and closed at $55.98 per barrel. Year to date, Oil prices are up 23.28%.
  • The spot price of Gold rose 0.43% this week and closed at $1,298.95 per ounce. Year to date, Gold prices are up 1.28%.

Economic Data

  • Initial jobless claims fell by 3,000 to 223,000 for the week. The four-week moving average of claims fell by 3,000 to 226,000. Claims fell by 3,000 in Kentucky.
  • Nonfarm productivity rose by 1.9% in the fourth quarter versus expectations for an increase of 1.5%.
  • Construction spending fell by 0.6% in December versus expectations for an increase of 0.1%.
  • The ISM non-manufacturing index rose 3.0 points to 59.7 versus expectations for a reading of 57.4.
  • New home sales rose 3.7% in December to a seasonally-adjusted annualized rate of 621k units versus expectations for 600k units.
  • Private sector employment rose 183,000 in February versus expectations for a gain of 190,000.
  • The trade deficit rose by $9.5 billion to -$59.8 billion in December against expectations for a deficit reading of -$57.9 billion.
  • Nonfarm payrolls rose by 20,000 in February, missing the forecasted 180,000 figure by a wide margin. This was the slowest pace of jobs growth since the 2017 hurricanes.
  • The unemployment rate fell to 3.8%, led by household employment
  • The labor force participation rate remained at 63.2%, the highest level since 2013
  • Average hourly earnings rose by 0.4% versus expectations for a 0.3% increase. The year-over-year rate rose to 3.4%
  • Housing starts rose by 18.6% in January to 1,230k versus expectations for a 10.9% increase to 1,195k. The figure was led by single-family homes in the Northeast region rebounding sharply
  • Building permits rose by 1.4% to 1,345k in January versus expectations for a decline of 2.9%

Fact of the Week

  • Mark Haines famously said on CNBC on March 10th, 2009 “I’m going to step out on a limb here… I think we’re at a market bottom”. After the financial crisis that rocked the market, the stock market reached its lowest point of the recession on March 9th 2009. Since then, the S&P 500 has returned 366.64% on a total return basis, which is 16.65% annualized. (Source: CNBC, Bloomberg)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

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China, Brexit, Venezuela: Wealth Economic Update Mar. 2, 2019

U.S. and World News

  • china_us-1035146880Earlier this week, President Trump extended the March 1st trade truce deadline between the United States and China, citing “substantial trade progress”. If the deadline had not been extended, the tariff rate on $200 billion in Chinese products would have been increased to 25% from 15%. Chinese equities soared over 5% on the news into bull market territory. U.S. Trade Representative Robert Lighthizer stated that it’s too early to draw conclusions on a trade deal between the two countries and that even if a deal was made, the United States would need to maintain the threat of tariffs.
  • In an effort to stop Britain from leaving the European Union without a deal, British Prime Minister Theresa May has pushed back a vote on her next Brexit deal to as late as March 12, about two and a half weeks before Britain leaves the European Union. European parliament had created rules that requires the U.K. financial services industry to abide by European Union standards after Brexit in order to keep control of market access. The U.K.’s main opposition Labour Party is also committed to having a second Brexit referendum, surprising doubters.
  • The United States is continuing to find new ways to aid economically devastated Venezuela after last weekend’s attempt to send aid resulted in two people killed and 300 people wounded. The U.S. is working with Venezuelan opposition leader Juan Guaido to pressure Nicolas Maduro to step down by means of sanctions. Vice President Mike Pence is calling on allies to freeze assets of state-owned oil company PDVSA. As a response, Venezuela is now exporting crude from India and Europe instead of the United States, however, this is predicted by analysts to be ineffective in generating profits.


Markets

  • Stocks marched higher again this week. The S&P 500 rose 0.45% and closed at 2,804. The Dow Jones gained 0.07% and closed at 26,026. Year to date, the S&P is up 12.24% and the Dow Jones is up 12.08%.
  • Yields spiked this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.56% and 2.75%, respectively.
  • The spot price of WTI Crude Oil declined this week. Prices fell 2.65% and closed at $55.74 per barrel. Year to date, Oil prices are up 22.75%.
  • The spot price of Gold fell 2.70% this week and closed at $1,293.44 per ounce. Year to date, Gold prices are up 0.85%.

Economic Data

  • Initial jobless claims rose by 9,000 to 225,000 for the week. The four-week moving average of claims fell by 7,000 to 229,000. Claims rose by 5,000 in Kentucky, 4,000 in New York, and fell by 3,000 in Washington.
  • Real GDP rose by 2.6% in the 4th quarter versus expectations of a 2.2% increase. The rise was driven by a surprise in personal consumption led by autos and financial services, offsetting the weak December retail sales figure.
  • Personal income fell 0.1% in January versus expectations for a 0.3% increase, but rose by 1.0% in December.
  • Personal spending fell by 0.5% in December versus expectations for a 0.3% decrease.
  • Wholesale inventories rose by 1.1% in December versus expectations for a 0.4% increase.
  • Housing starts fell by 11.2% in December versus expectations for a 0.1% drop. The drop was led by the multi-family category in the West and Midwest regions.
  • The Conference Board index of consumer confidence rose by 9.7 points to 131.4 in February versus expectations for a reading of 124.9.
  • Pending home sales rose by 4.6% in January versus expectations for a 1.0% increase.
  • Factory orders rose by 0.1% in December versus expectations for a 0.6% increase.
  • The University of Michigan’s index of consumer sentiment fell 1.7 points to 93.8 in February versus expectations for a reading of 95.9.

Fact of the Week

  • 69% of 1,017 adults surveyed in January 2019 believe that they will be “financially better off in 1 year,” a result that is 2 percentage pointsless than the all-time record of 71%recorded in March 1998. This survey has been conducted since August 1977. The 1998 record was achieved during a stretch for the S&P 500 that produced annual returns of at least +20% (total return) for 5 consecutive years(1995-1999) (source: Gallup).

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

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China deal, Brexit: Wealth Economic Update Feb. 22, 2019

U.S. and World News

  • china_us_trade-1026713438_370With one week left until the March 1st deadline for the temporary trade truce between the United States and China, negotiators have drawn up memorandums of understanding on forced technology transfer, cyber theft, intellectual property rights, services, currency, agriculture and non-tariff barriers to trade. This is the most progress that has been made on trade since the 7-month trade negotiations have begun. President Trump stated earlier this week that he would consider pushing back the March 1st deadline and that it is not a “magical date”. Today, President Trump is scheduled to meet with Chinese Vice Premier Liu He at the Oval Office where they will attempt to come to a deal. Some sources have said today that President Trump and Chinese President Xi Jinping could have a summit in Mar-a-Lago in late March, raising expectations for an extended deadline.
  • British Prime Minister Theresa May traveled to Brussels earlier this week in an attempt to resolve the Brexit impasse as European Union officials say that they will not reopen the divorce deal. The issue creating the impasse is whether there will be a hard border around Ireland or not. At this point, Great Britain is at a high risk of leaving the European Union without a deal on March 29th and also risks a credit rating downgrade. There is speculation that Theresa May will ask for a three-month delay to the Brexit deadline. It is in both parties interest to make a deal before May 23-26, otherwise the United Kingdom would have to participate in the European Union’s elections.


Markets

  • Stocks rose again this week, extending the rally off of the Christmas Eve low. The S&P 500 rose 0.65% and closed at 2,793. The Dow Jones gained 0.59% and closed at 26,032. Year to date, the S&P is up 11.73% and the Dow Jones is up 12.00%.
  • Yields fell slightly this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.47% and 2.65%, respectively.
  • The spot price of WTI Crude Oil rose dramatically this week. Prices jumped 10.00% and closed at $57.08 per barrel. Year to date, Oil prices are up 25.70%.
  • The spot price of Gold rose 0.52% this week and closed at $1,329.40 per ounce. Year to date, Gold prices are up 3.66%.

Economic Data

  • Initial jobless claims fell by 23,000 to 216,000 for the week. The four-week moving average of claims rose by 4,000 to 232,000. Claims fell by 5,000 in New York, 4,000 in Wisconsin, and 3,000 in California, Michigan, and Pennsylvania.
  • New orders for durable goods rose by 1.2% in December versus expectations for a 1.7% increase.
  • Durable goods ex-transportation rose by 0.1% in December versus expectations for a 0.3% increase.
  • Core capital goods orders fell by 0.7% in December versus expectations for a 0.2% increase.
  • Existing home sales fell by 1.2% in January versus expectations for a 0.2% increase. The decline was led by single family homes in the West and Midwest regions.

Fact of the Week

  • In a recent survey, 63% of respondents believed that the “upper income people pay too little” in taxes. The top 5% of US tax payers account for 35% of adjusted gross income nationwide and pay 58% of all federal income taxes. (Source: Politico, Morning Consult, Internal Revenue Service)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

China deal, Border wall: Wealth Economic Update Feb. 15, 2019

U.S. and World News

  • Trade negotiations with China continue to grow increasingly optimistic after a week of constructive talks between the United States and China. Chinese President Xi Jinping has announced that negotiations will resume in Washington next week and President Trump suggested that he would consider pushing back the March 1st deadline if progress was being made. U.S. trade negotiator Robert Lighthizer said “We feel that we have to make headway on some very, very important and very difficult issues” and that he was “hopeful” of progress. As it stands, if no deal is made before March 1st, tariffs on $200 billion of Chinese goods would be raised to 25%. China’s trade surplus with the United States fell 42% to $27.3 billion last month, the lowest since May 2018.
  • iStock-173950266_370The White house has reached a tentative budget agreement that includes a $1.38 billion border security deal that would prevent another government shutdown. The compromise detailed funds for 55 new miles of barriers along the border in Texas and passed the House 300 to 128 and the Senate 83 to 16. After signing the deal, President Trump hosted a televised announcement in the Rose Garden where he stated that he would sign a declaration of a national emergency at the border. This would give the government access to billions of dollars to fund the construction of the full border wall.


Markets

  • Stocks extended the rally with a very strong week. The S&P 500 jumped 2.56% and closed at 2,776. The Dow Jones rose 3.20% and closed at 25,883. Year to date, the S&P is up 11.00% and the Dow Jones is up 11.35%.
  • Yields rose this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.49% and 2.66%, respectively.
  • The spot price of WTI Crude Oil rose sharply this week. Prices jumped 5.84% and closed at $55.80 per barrel. Year to date, Oil prices are up 22.88%.
  • The spot price of Gold rose 0.62% this week and closed at $1,322.49 per ounce. Year to date, Gold prices are up 3.12%.

Economic Data

  • Initial jobless claims rose by 4,000 to 239,000 for the week. The four-week moving average of claims rose by 7,000 to 232,000. Claims rose in Washington by 4,000 and in New York by 2,000.
  • Retail sales plunged 1.2% in December versus expectations for a gain of 0.1%.
  • Core retail sales fell by 1.7% versus expectations for a 0.4% gain.
  • The producer price index (PPI) fell by 0.1% in January versus expectations for an increase of 0.1%. This was led by declines in energy and food.
  • The consumer price index (CPI) was flat in January versus expectations for a 0.1% increase.
  • The core CPI measure rose 0.2%, in-line with expectations.
  • Industrial production fell by 0.6% in January versus expectations for a 0.1%. increase.
  • Manufacturing production fell by 0.9% in January versus expectations for a flat reading.
  • The University of Michigan’s index of consumer sentiment came in at 95.5 in February versus expectations for a reading of 93.7.

Fact of the Week

  • On the day that Janet Yellen was sworn in as Fed Chair (2/03/14), the S&P 500 was down 2.3%(total return), the worst trading day for the index in 2014. On the day that Jerome Powell was sworn in as Fed Chair (2/05/18), the S&P 500 was down 4.1%(total return), the worst trading day for the index in 2018 (source: BTN Research).

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

China deal, Venezuela protests: Wealth Economic Update Feb. 8, 2019

U.S. and World News

  • As the March 1st deadline for a trade truce between the United States and China approaches, the chances for a trade deal to be made are growing much smaller. White House Economic Advisor Larry Kudlow stated this week that a “pretty sizable distance” remains between the two sides. President Trump followed up on Larry Kudlow’s comment by announcing that he will not be meeting with Chinese President Xi Jinping before March 1st. These comments from the White House have arisen following a few weeks of renewed optimism over trade negotiations, changing the tone ahead of the deadline. President Trump is set to sign an executive order next week that would ban Chinese telecom equipment from United States wireless networks in an effort to combat cyber threats.
  • CARACAS-500750930Western nations continue to push for the resignation of socialist leader Nicolas Maduro of Venezuela as hundreds of thousands of protestors blanketed the streets of Caracas last weekend. The protestors are in support of self-proclaimed President Juan Guaido. The United States has announced that military intervention in Venezuela is an option and have placed extreme sanctions on the country and the state owned oil firm PDVSA, whose 2026 maturity debt is now trading at 23.75 cents on the dollar. The new sanctions have crippled the liquidity on Venezuelan sovereign debt and has caused JPMorgan to consider removing the securities from its popular emerging-market bond indexes. This action would force the largest holders of Venezuelan sovereign debt to sell in a market where it is unclear if there is any buying interest for the securities.


Markets

  • Stocks continued rallying this week before retreating in the second half of the week over concerns of slowing global growth and U.S China trade. The S&P 500 gained 0.11% and closed at 2,708. The Dow Jones increased 0.32% and closed at 25,106. Year to date, the S&P is up 8.24% and the Dow Jones is up 7.90%.
  • Yields declined further this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.44% and 2.63%, respectively.
  • The spot price of WTI Crude Oil dropped this week over concerns of growing supply. Prices fell 4.60% and closed at $52.72 per barrel. Year to date, Oil prices are up 16.10%.
  • The spot price of Gold fell 0.30% this week and closed at $1,314.08 per ounce. Year to date, Gold prices are up 2.46%.

Economic Data

  • Initial jobless claims fell by 19,000 to 234,000 for the week. The four-week moving average of claims rose by 5,000 to 225,000. Claims fell by 3,000 in Florida and New Jersey.
  • Factory orders fell by 0.6% in November versus expectations for a small increase.
  • The ISM non-manufacturing index fell to 56.7 versus expectations for a reading of 57.1.
  • The trade balance for November fell $6.4 billion to -$49.3 billion versus expectations for a reading of -$54.0 billion.

Fact of the Week

  • 27% of millennials surveyed in July 2018 spend more money on coffee per month than they put away and invest for retirement (Source: Lendedu)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

China deal, Venezuela oil, Brexit: Wealth Economic Update Feb. 1, 2019

U.S. and World News

  • china-945440206_370President Trump is optimistic that the world’s two largest economies could reach “the biggest deal ever made” and confirmed that a U.S. delegation will visit China in mid-February for a new round of trade talks. The feeling is mutual. China’s trade delegation said the latest negotiations with the U.S. in Washington made “important progress” and focused on three key themes – “trade, structural issues and enforcement.”
  • Despite the rhetoric between Nicolas Maduro and President Trump, U.S. refineries are still buying Venezuelan petroleum. But with the crisis escalating after Washington backed opposition leader Juan Guaido, a new round of sanctions is expected in the coming days. The U.S. on Saturday called on the world to “pick a side” on Venezuela and urged countries to financially disconnect from the Maduro government. “The U.S. has decided to follow the path of stealing Citgo from Venezuela,” President Nicolas Maduro declared after the Trump administration imposed sanctions on its parent company – state-owned oil giant PDVSA. While the sanctions will hit Citgo, the penalties will have a minimal effect on other American refiners, according to Treasury Secretary Steven Mnuchin.
  • In an attempt to break the deadlock over Brexit, Theresa May will seek legally binding changes from the EU regarding the Irish backstop, lawmaker Boris Johnson wrote in The Telegraph, citing senior government sources. “If the PM secures a ‘Freedom Clause’ – for the U.K. to escape the backstop without reference to the bloc – I have no doubt that she will have the whole country full-throatedly behind her.”


Markets

  • • Stocks had a good week following comments from the Fed. The S&P 500 gained 1.62% and closed at 2,706.53. The Dow Jones increased 1.33% and closed at 25,063.89. Year to date, the S&P is up 8.12% and the Dow Jones is up 7.56%.
  • Yields fell again week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.51% and 2.69%, respectively.
  • The spot price of WTI Crude Oil extended its gains this week. Prices rose 6.39% and closed at $55.31 per barrel. Year to date, Oil prices are up 20.98%.
  • The spot price of Gold rose 0.99% this week and closed at $1,318.21 per ounce. Year to date, Gold prices are up 2.79%.

Economic Data

  • Sales of new single-family homes sharply rebounded 16.9% in November to a seasonally-adjusted annualized rate of 657k units, significantly above expectations. November sales increased month-over-month in three of four regions, with the largest increase in the South (+64k) that likely reflected a rebound following Hurricane Michael.
  • The FOMC left the funds rate target range unchanged, as universally expected. The post-meeting statement continued to describe job gains and household spending as “strong” but downgraded its characterization of overall growth to “solid”.
  • The Conference Board index of consumer confidence declined 6.4pt to 120.2 in January, an 18-month low and against consensus expectations for a more modest decrease. The decline reflected a large decrease in the household expectations sub-index (-10.4pt to 87.3) and a small decrease in the household perceptions of present economic conditions sub-index (-0.3pt to 169.6).

Fact of the Week

  • In preparation of the Super Bowl, it is anticipated that Americans will consume 100 million pounds of guacamole. At an average weight of 150 grams per avocado, this equates to over 300 million avocados. (Source: Produce News)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

Shutdown, Wall: Wealth Economic Update Jan. 25, 2019

U.S. and World News

  • laguardia-898593448President Trump reached a deal with congress today to open and fund the government until February 15th. The hundreds of thousands of furloughed federal workers during the 34 day partial government shutdown are expected to receive back pay. The bill that was agreed upon does not include $5.7 billion for a border wall. President Trump stated that if there is no agreement on border wall funding by February 15th, either the government will shut down again, or he will take executive action to provide funds. This announcement today comes after two bills failed to pass the senate yesterday, and the unscheduled absences of Transportations Security Agents caused a brief ground stop a LaGuardia airport in New York this morning.


Markets

  • Stocks were relatively unchanged from last week, in another volatile week. The S&P 500 declined 0.21% and closed at 2,665. The Dow Jones increased 0.13% and closed at 24,737. Year to date, the S&P is up 6.40% and the Dow Jones is up 6.15%.
  • Yields retreated slightly from last week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.60% and 2.76%, respectively.
  • The spot price of WTI Crude Oil continued trending higher this week. Prices rose 1.02% and closed at $53.55 per barrel. Year to date, Oil prices are up 17.93%.
  • The spot price of Gold rose 1.80% this week and closed at $1,305.25 per ounce. Year to date, Gold prices are up 1.92%.

Economic Data

  • Initial jobless claims fell by 14,000 to 199,000 for the week, the lowest level since 1969. The four-week moving average of claims decreased by 6,000 to 215,000. Claims fell by 5,000 in Kentucky and by 4,000 in California and Michigan.
  • Existing home sales fell by 6.4% in December to a seasonally adjusted annualized rate of 4.99 million units versus expectations for a decline of 1.5%. Sales in the Midwest region led the decline.

Fact of the Week

  • The average price of gasoline nationwide on 1/18/19 (last Friday) was $2.24. 50 years ago, the average price of gasoline was 35 cents. When adjusted for 50 years of inflation, the 35 cent price is equal to $2.48 in 2019 dollars. (Source: AAA, Department of Labor)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

National Data Privacy Day: Minimizing Your Risks

Robert M. Duplessis, CRISC, CISM, CBVM
Senior Vice President/Information Security Officer

Every January 28, security experts observe National Data Privacy Day, though the reason is far from celebratory. Instead, the day is devoted to raising awareness about the risks of sharing data in daily life. Over the years that awareness has evolved from warnings that using birthdays as PINs is a bit risky to the new reality that the privacy of data—everyone’s data—is under constant attack.

Hacker attacks on computers now launch at a rate of every 39 seconds*. Breaches that result in records being stolen are occurring at a rate of 158,727 per hour*! Worse, the pools of information available to be hacked are increasing, thanks to the growth of the internet of things (IoT).

The New Normal: Data in Motion
You may actively use settings to restrict public access to your social media accounts and practice good self-policing of your personal data. However, every time you shop for books or boots online, ask your voice-activated device a trivia question, stream videos or even send your DNA to a lab to learn about your ancestry, you are giving up valuable data about yourself. And, if you are like most people, you do so without considering the security risks.

IoT attacks were up 600% in 2017.

7 Ways to Play Defense
While it may seem as if society in general has already lost the war on privacy, that doesn’t mean you can’t defend yourself against personal loss. There are tools you can use and actions you can take to keep your data from being turned against you. Here are a few of these.

  1. Know how those you deal with treat your information. Read our privacy policy, along with the policies of any site or service you access, to make sure they are protective of their customers’ data before you give them yours.
  2. Conduct an annual audit of your data. Determine where it is and what each organization you deal with knows about you. Uninstall any old apps—the older they are and the less frequently they are updated, the more vulnerable they are to hacking.More than 75% of the health care industry was infected with malware last year.
  3. Monitor your credit reports. The FDIC recommends visiting www.annualcreditreport.com* or calling 877-322-8228 to acquire a free credit report every 12 months from each of the three major credit bureaus. These reports function as early detection systems if someone is trying to borrow your identity.
  4. Be an early filer. Because many security breaches in the retail and health care industries have compromised social security numbers, file your tax return as early as possible, especially if you anticipate a refund. Fraudulent filings delay refunds for months while the IRS straightens things out.Three industries were responsible for 95% of the records stolen in 2016.
  5. Don’t trust, before you verify. Before giving up any information online through an email or text, verify that the person or company asking for it is legit. Hover over the address line to see where the email is really coming from. Verify any phone numbers through an independent online search before calling.71% of cyber attacks begin with phishing emails.
  6. Use tools designed to keep your information safe. Our Trusteer Rapport is security software that protects your online banking communications from being stolen. It works in addition to any antivirus or firewalls and is designed to catch fraud immediately. We also offer Security Manager, an authentication product for businesses or personal customers that generates passcodes via text and works in conjunction with your current security features.Small businesses were the target of 43% of cyber attacks.
  7. Secure you debit card. When you misplace your debit card, use our SecurLOCK™ Equip Mobile App to turn your debit card on and off and monitor spending.

Working Hard to Keep You Safe
It’s unfortunate that every time you touch a screen or pay by phone, credit or debit card you give up some personal information. We are committed to helping you protect your most valued possessions.

Whenever you have any doubts about your bank accounts, visit our FAQ section. Also, feel free to contact us online or call 877-866-0202. We are always happy to talk through your concerns, privately.

  1. Sobers, Rob. “60 Must-Know Cybersecurity Statistics for 2019.” Varonis. Web. January 2, 2019. <https://www.varonis.com/blog/cybersecurity-statistics/*>
  2. “13 Alarming Cyber Security Facts and Stats.” Cybint. Web. December 3, 2018. <https://www.cybintsolutions.com/cyber-security-facts-stats/*>
  3. “13 Alarming Cyber Security Facts and Stats.”
  4. Sobers, Rob. “60 Must-Know Cybersecurity Statistics for 2019.”
  5. “13 Alarming Cyber Security Facts and Stats.”

*This is an outbound link that will take you away from the WordPress blog. Before you go, we want to let you know that you are accessing a resource that includes data not hosted on our website. This service has been provided for your convenience only. It does not imply that Old Second Bank endorses or sponsors the information you will be viewing. We also cannot guarantee its accuracy or that your privacy will be maintained should you choose to disclose any personal information while on the linked site. Also, please be aware that the products and services offered on third-party sites, including investment and insurance products, are not products of Old Second Bank and may not be insured by the FDIC. Thank you and hope to see you back here soon.

China, Brexit, Shutdown: Wealth Economic Update Jan. 18, 2019

U.S. and World News

  • beijing-482334184_370China’s chief trade negotiator, Vice Premier Liu He, will come to Washington D.C. for the next round of trade talks on January 30-31. The visit comes after some surprisingly negative economic data coming out of China this week that showed sharp contractions in both imports and exports. The poor numbers have led to stimulus measures such as tax cuts by the People’s Bank of China and figure to make it even more pressing for some sort of deal to be struck. The U.S. side isn’t necessarily presenting a unified front however, with Treasury Secretary Steve Mnuchin saying that Washington could ease tariffs on China, while U.S. Trade Representative Robert Lighthizer pushed back on this suggestion and continues to take a hardline stance.
  • British Prime Minister Theresa May submitted a Brexit proposal to Parliament this week which was soundly voted down and prompted a no-confidence motion from the opposition Labour Party. While May was able to survive the no-confidence vote, she now has a Monday deadline to set out her Brexit Plan B. She may be forced budge on certain items to get her opponents on her side, such as keeping closer ties to the European Union or postponing Britain’s separation from the economic bloc. However, with less than 70 days remaining until “Brexit Day”, if the two sides do not come together it becomes more likely that Parliament will take control of the Brexit process.
  • The partial government shutdown carries on through its 28th day, extending the record long impasse. Estimates for the cost of the shutdown have been increased from an initial figure of a -0.1% impact on GDP every two weeks it was in force, to -0.1% every week. The January employment report figures to show job growth being slashed by nearly 500,000 and the headline unemployment rate rising to 4.0% if the situation isn’t resolved quickly.


Markets

  • Stocks rose higher again this week, continuing the bounce off of the Christmas Eve lows. The S&P 500 rose 2.90% and closed at 2,670. The Dow Jones increased 3.01% and closed at 24,706. Year to date, the S&P is up 6.63% and the Dow Jones is up 6.02%.
  • Yields were on the rise this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.62% and 2.78%, respectively.
  • The spot price of WTI Crude Oil rose sharply this week, continuing its recent upward trend. Prices jumped another 4.17% and closed at $53.74 per barrel. Year to date, Oil prices are up 18.28%.
  • The spot price of Gold fell 0.63% this week and closed at $1,282.11 per ounce. Year to date, Gold prices are unchanged.

Economic Data

  • Initial jobless claims fell by 3,000 to 213,000 for the week. The four-week moving average of claims decreased by 1,000 to 221,000. Claims fell by 3,000 in New York and by 2,000 in Connecticut and Pennsylvania.

Fact of the Week

  • If calendar year 2018 GDP growth, which is released on 1/30, is reported above 3%, it will break a 12 year streak of “sub 3%” growth (2006-2017). This is the longest such streak in US history, with the next longest “sub 3%” streak taking place in the 4 your period from 1930-1933 during the Great Depression. (Source: Commerce Department)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.

China, Brexit, Shutdown: Wealth Economic Update Jan. 11, 2019

U.S. and World News

  • The trade negotiation with China shifted to a more positive tone this week after U.S. Commerce Secretary Wilbur Ross stated that the United States and China could reach a deal that “we could live with”. China’s foreign ministry stated that China has “good faith” to work with the United States to reach a deal. Some meaningful progress was made this week during a prolonged meeting that included China’s purchases of U.S. farm and energy products and expanded access to China’s markets. However, negotiations over forced U.S. technology transfer did not improve. Chinese Vice Premier Liu He is expected to visit the United States in the near future for further negotiations.
  • British Prime Minister Theresa May finds herself in a tough spot in the days leading up to the January 15th vote on her Brexit deal as a result of lawmakers restricting her tax-varying powers in the event of no agreement. The last vote on a Brexit deal was delayed as there was not enough support and things have failed to improve since. The pressure for a deal to be made grows by the day as the March 29th deadline nears.
  • capitol-621851478With no end in sight, the partial government shutdown now ties the record for longest in American history, on its 21st day. Effects of a lengthened government shutdown are forgone pay from millions of federal employees, delayed business permits and visas, delayed IPO’S, and mergers and acquisitions. Withheld pay from federal employees could potentially impact consumer spending, a significant portion of the United States economy. Fitch’s global head of sovereign ratings stated that the United States triple-A credit rating could be in question because of the inability to pass a budget. The two government parties remain at an impasse over President Trump’s request for border wall funding.


Markets

  • • Stocks rose higher again this week as tensions with China have eased and the Fed provided some calming language regarding policy. The S&P 500 rose 2.58% and closed at 2,596. The Dow Jones increased 2.42% and closed at 23,996. Year to date, the S&P is up 3.63% and the Dow Jones is up 2.93%.
  • Yields rose slightly this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.53% and 2.70%, respectively.
  • The spot price of WTI Crude Oil rose sharply this week. Prices jumped 6.41% and closed at $51.63 per barrel. Year to date, Oil prices are up 13.70%.
  • The spot price of Gold rose 0.13% this week and closed at $1,287.68 per ounce. Year to date, Gold prices are up 0.40%.

Economic Data

  •  Initial jobless claims fell by 17,000 to 216,000 for the week. The four-week moving average of claims rose by 3,000 to 222,000. Claims fell by 3,000 in California and fell by 2,000 in Florida, Illinois, and New Jersey.
  • The ISM non-manufacturing index fell by 3.1 points to 57.6 versus expectations for a reading of 58.5.
  • The consumer price index (CPI) fell by 0.06% in December, in-line with expectations. The year-over-year rate rose 1.95% versus expectations of a 1.9% increase.
    • Core CPI rose by 0.21% in December, in-line with expectations. The year-over-year rate rose by 2.21% in December, in-line with expectations.

Fact of the Week

  • Today marks the 21st day of the government shutdown, which ties the shutdown spanning December 16, 1995 to January 6th, 1996 under President Bill Clinton as the longest shut down in history. During the ’95-’96 shutdown, the S&P 500 returned 0.156%. As of the close today, the S&P 500 is up 7.54% since the government shutdown at midnight on December 22. (Source: Bloomberg)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 –  rgartelmann@oldsecond.com
Steve Meves, CFA® – (630) 801-2217 – smeves@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz – (630) 906-5467 ejgorenz@oldsecond.com
Mike Demski – (630) 966-2430 mdemski@oldsecond.com
Mike Cava – (630) 281-4522 mcava@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC nor any govt agency; not a deposit of, or guaranteed by, the bank; may lose value.