Archives for November 24, 2019

Weekly Market Review – November 23, 2019

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Stock Markets

The U.S. stock markets had a bit of a reprieve this week with a small decline. That comes after six continuous weeks of advances and new highs. The volatility level continues to be low, but still a concern. The news on the U.S./China trade made things murky for investors who seem unsure if there is indeed a “Phase 1” trade deal ready to be completed before the year closes. The preliminary U.S. Purchasing Managers’ Index for November indicated an uptick in economic activity. This supports what most analysts see as the passing of the worst of the manufacturing slowdown.

U.S. Economy

In the US economic outlook, it’s not simply where things are headed that counts, but also how they will arrive at the end mark. As evidenced this year yet again, stocks go through significant rallies followed by pullbacks. The underlying drivers and the make-up of the components serve as indicators or predictors as to how long those trends may continue. So, while the market has continued strong over the last while (gains of 26.0% in 2019 and 6.6% in just the last three months), the question is will this continue? Analysts seem to agree on a couple of aspects here: they doubt that the market will continue with this magnitude. Mainly, they say, another 20%-plus gain is unlikely in 2020. They also doubt its continued steadiness. Since the market has rallied with virtually no volatility, that would need to continue. But overall, they think the direction will continue with a prolonged bull market led by more moderate gains on a bumpier road toward those gains. The underlying fundamentals, they say, are in place to support this path.

Metals and Mining

Gold managed to hang above US$1,460 an ounce Friday supported by the concerns that a trade deal between the US and China may not close by the end of the year as previously expected. For most of the week gold traded in the US$1,465 range but climbed on Wednesday more than US$9 an ounce to finish out the week as the only precious metal to eke out gains. The price surge for the safe haven metal can be pinned on the US Congress passing two bills that are specifically in support of human rights issues for Hong Kong. The legislation was of course condemned by China. Silver on the other hand was unable to get past the US$17.19 level which was its high point in the week. Silver reacted to the positive tariff talks, pushing the metal lower, despite the fact that it has gained a double-digit uptick year-to-date, climbing 12 percent. Still, it has been slightly outpaced by gold, which is up 14 percent. The steady player in the precious metals game was platinum, which hovered at the US$900 mark before dropping 2.6 percent post market open. Platinum has also enjoyed a double-digit gain over the last 12 months, but nothing like palladium. That metal has gained 12 percent year-to-date and looks balanced for 2019. According to a recent report from the World Platinum Council, record growth in platinum ETFs is the driving factor in the 12 percent increase in demand for palladium. Overall, the industrial platinum group metal prices are up more than 40 percent year-to-date. That can be attributed to the strong demand by the automotive sector. Palladium fell to US$1,731.50 at 10:46 a.m. EST Friday.

Energy and Oil

Global oil prices rebounded midweek this week with signs of a tighter physical market and more rumors that OPEC+ may extend production cuts. In reality, the market is awaiting direction from the U.S.-China trade war and until a firm answer emerges, every murmur has an immediate price impact. So, while markets are optimistic, everyone is cautious at this point.

Natural gas spot price movements were mixed this week. The Henry Hub spot price fell from $2.62 per million British thermal units (MMBtu) last week to $2.47/MMBtu this week.

At the New York Mercantile Exchange (Nymex), the price of the December 2019 contract decreased 4¢, from $2.600/MMBtu last week to $2.559/MMBtu this week. The price of the 12-month strip averaging December 2019 through November 2020 futures contracts declined 6¢/MMBtu to $2.427/MMBtu.

World Markets

European equity markets were under pressure from the uncertainty about the future of a U.S.-China trade deal, aka ‘Phase One’. The pan-European STOXX Europe 600 Index lost 0.3%, while the German DAX was off 0.5%. The UK’s FTSE 100 Index gained about 0.5% in proportion with a decline in the British pound that echoed the U.S. dollar. Typically, UK stocks gain when the pound falls since a majority of companies that make up the index benefit from overseas revenues. The telling Purchasing managers’ indexes (PMIs) in the eurozone showed manufacturing activity shrank at a slower pace in November, while services numbers dropped slightly. The region’s manufacturing PMI rose to a three-month high of 46.6 in November. That is still in contraction territory. Data show that Germany’s manufacturing PMIs rose for the second straight month and Germany’s Statistics Office confirmed that the German economy grew 1%, narrowly missing the recession numbers.

Chinese stocks were down for the week sparked by the U.S. support for a bill in aid of protestors in Hong Kong. This also pivoted the expectations for a partial trade deal that was supposed to be completed by November. On the week, the benchmark Shanghai Composite Index declined 0.2% and the large-cap CSI 300 Index, which tracks stocks listed on the Shanghai and Shenzhen exchanges, fell a tiny 0.7%. In both cases, the markets fell to their lowest points Friday well after the U.S. House and Senate each passed a bill supporting human rights in Hong Kong. The passage of the bill compiled the uncertainty surrounding talks on the ’phase one’ trade deal, which most expect is the gateway for greater progress across the board.

The Week Ahead

While this week will be shortened by the Thanksgiving Holiday, there are still several important economic data that will come out in the run-up. Key data emerging this week include consumer confidence, new home sales, third-quarter GDP (second estimate), as well as with capex order, Chicago PMI, durable goods orders and personal income on the eve of the holiday.

Key Topics to Watch

  • Chicago Fed national activity index
  • Advance trade in goods
  • Case-Shiller home price index
  • Consumer confidence index
  • New home sales
  • Weekly jobless claims
  • GDP revision
  • Durable goods orders
  • Core capex orders
  • Chicago PMI
  • Personal income        
  • Consumer spending
  • Core inflation
  • Pending home sales index

Markets Index Wrap Up

Our readers on the Powerbeats Pro’s best features

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The highs and lows of Beats’ first true wireless earbuds, according to people who own them.

Though Beats was a little late to market with its first true wireless earbuds, this year the company debuted a set designed for a comfortable and secure fit: the Powerbeats Pro. With its over-the-ear hook construction, chunky charging case and speedy H1 chip the Pro impressed senior news editor Billy Steele, largely thanks to its solid battery life, sound quality and ambidextrous onboard controls. However, imperfections like its Lightning charger, unwieldy case, and overbearing treble kept the Pro’s score to an honorable 86. Users scored the Pro more sternly and gave the Powerbeats Pro a much lower rating of 71.

Case

One of the things on Billy’s list of cons was the Powerbeats’ case, and most users agreed with him. Shaman42 called it the only downside, while both Ken and Travan found it hard to transport or carry in a pocket. Parpy was more pragmatic, saying that “I agree the charging case is rather huge and annoying sometimes but it might be a necessary evil considering the amount of power it contains.” Michael encouraged folks to “Get over the size of the charging case … you can’t have everything!” Nancy actually liked the case because of the “insanely smooth material that feels great in one’s hand.”

Powerbeats Pro

Battery

One of the advantages of the Powerbeats Pro and its large case is outstanding battery life. In normal usage, Billy was unable to drain the charge on the wireless buds. User reviewers had almost nothing negative to say about the Pro’s battery life, with Ken and Michael both calling it great. Ccordes2 said the superb battery “means I hardly ever have to think about or am forced to recharge.” Jaime was impressed that the “batteries actually last so long,” and Nancy said the “battery life is unreal. During a 10+ hour flight I didn’t even need to charge them in the case.” However, Travan said they found the lack of an on/off capability led to the device discharging in pockets.

Fit

The first true wireless set in the Beats lineup, the Powerbeats Pro feature an over-the-ear hook design, which originally debuted in 2010. The hook was engineered for a secure fit and the main part of the buds is angled instead of sitting outside of the ear. This design worked well for most; Hdfanboy found them to have a comfortable fit, and both he and Parpy felt the buds stayed in place well while working out or wearing a baseball cap. Nancy, who has small and sensitive ears, says the firm fit made the Powerbeats the “best workout pair of headphones I’ve ever owned.”

However, others had a less satisfactory experience: Jaime said the hooks only became comfortable after about a week of wear, and Jeff said that “the ball at the base and angle that they go inside the ear actually hurt after a few minutes of use.” Lo felt the “posts are too short. I can barely get a good seal to experience the best possible sound. Even aftermarket ear tips suffer the same problem.”

Powerbeats Pro

Sound

Billy called the Powerbeats Pro “the best-sounding Beats headphones yet,” and users Ken and Michael agreed, saying music sounded incredible. Hdfanboy found the sound quality very good, Lo said they “sound great when I press them into my ear,” and Jaime felt the Powerbeats Pro have “more powerful sound than anything.” The only disappointment appeared to be the lack of noise isolation. Nancy said while cleaning her office “I picked up and moved a poster frame wrapped in bubble wrap. The person I was speaking with said it sounded like I was shaking a bag of M&Ms in his ear.” Ccordes2 disagreed, saying they’ve received great feedback on their use for business phone calls.

Connectivity

One of the universally criticized features of the Powerbeats Pro was its connection. Ken encountered “too many issues with losing connectivity” and Jaime said their “only gripe is how my Samsung Note 8 handles pairing.” Parpy said during their runs there had been “some signal lost but overall they work well.”

Beats Powerbeats Pro review

Overall

With a $250 price tag, Billy found that despite the tough competition the Powerbeats Pro held its own due to sound quality, range of features and reliability. Several users agreed that there were more positives than drawbacks about the wireless buds, including Michael who said “these headphones are awesome!” Hdfanboy, who uses the Powerbeats Pro on his daily walks also said the same thing. Ccordes2 claimed it was “by far the most well-rounded of the many units I’ve tried,” and said they would “strongly recommend these for on-the-go professionals or workout junkies.” Nancy is “constantly singing their praises,” and “probably spent an average of $100 a year on headphones and earbuds” before she found the right set in the Powerbeats Pro.

This New Retirement Trend Could Mean You Don’t Need to Save as Much

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Saving for retirement can be stressful, especially if you’re running short on time and your nest egg isn’t as large as you’d like. It’s a common problem among Americans — in fact, close to half of baby boomers have no retirement savings at all, according to a report from the Insured Retirement Institute.

However, there’s good news for those who have fallen behind: There are some new retirement trends that could make it easier for you to get by with a smaller amount of savings during your golden years.

“Unretirement” is the new retirement

Traditionally, workers have spent most of their adult lives employed, and either building up pensions or, in more recent decades, stashing money away in retirement accounts. Then at some point in their 60s, they leave their jobs and spend the rest of their years retired.

Today’s workers, though, have a different idea of what their retirements will look like. A whopping 92% of workers currently in their 40s say they plan to keep working part-time in retirement, according to a survey by TD Ameritrade and The Harris Poll. Even among those in their 70s, 52% say they plan to continue working an average of 10 hours a week.

Additionally, many workers say they don’t plan to ever fully retire. Among those in their 40s, 61% of respondents said they’d prefer to take year-long “mini-retirement breaks” while they’re younger, and then work until a later age, rather than work continuously for four decades or more and then retire completely.

These “unretirement” trends could be good news for those who are struggling to save for the future because it could mean you won’t need to save as much to enjoy a comfortable retirement.

If you’re still working 10 or 20 hours a week in retirement, you naturally won’t need to draw as much cash from your investments to make ends meet because you’re still getting a small paycheck. And you can still collect Social Security benefits even if you’re working, although if you’re below your full retirement age, the size of your checks may be reduced, depending on how much you’re earning at your job. If a good chunk of your retirement income is coming from your part-time job and Social Security checks, your nest egg will last a lot longer.

Another benefit of continuing to work is that it can keep your skills sharp. If you’re fully retired for 10 or 15 years, but then run low on savings and need to return to the workforce, it may be particularly challenging to find a job with an out-of-date skill set. But if you’ve been working part-time, even if you take a break for a year or two, you’ll be far more in tune with the latest trends and technologies in your industry, which will make it easier to pick up right where you left off.

Is “unretirement” a good fit for you?

Working on a part-time basis throughout retirement may be a good option for many retirees, but it’s not necessarily the right choice for everyone. Before you make it part of your long-term plan, it’s important to ask yourself a few questions.

First, consider how likely it is that you’ll be physically able to continue working in retirement. If you have health issues now that are liable to grow more acute as you age, it would be a risky gamble to plan your retirement around the idea of having income from a part-time job.

But assuming your health holds up, there’s another set of questions: What type of job do you think you’ll want in retirement — and do you have reason to believe you’ll be able to find that type of gig? For example, do you intend to stay in your current industry? If so, are there part-time positions available, and are there older workers taking them? Are employers likely to offer you the flexibility to take mini-retirement breaks every few years and then come back to work?

If you plan to explore a new field, look into the types of job opportunities that are out there and make sure you’re qualified for them. Even if there are roles that don’t necessarily need an advanced degree in a subject or years of hands-on experience, it might not be easy to land a job in an entirely new industry when you’re in your 60s or 70s.

Finally, ask yourself if you’re likely to be happy with this type of lifestyle. Retirement will be your opportunity to relax and live life however you choose, so you ought to spend your time doing things you enjoy. For some people, working part-time may be a pleasant opportunity to learn new things and make some extra cash at the same time. For others, though, continuing to work after retirement may sound like a dreadful idea. If you’re one of them, you’d likely better off saving more intensively now so you can afford to fully retire when you’re ready.

Working during your golden years may not be everyone’s cup of tea, but it could be the ticket to a far more comfortable and enjoyable retirement. If your savings are slim and the idea of keeping busy with a part-time job sounds more appealing than ending your working days with a full stop, “unretirement” may be one of the best financial decisions you can make.

Mom Discovers Huge Money-Saving Loophole In Target’s Return Policy

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One of the biggest struggles of parenthood is having to buy a whole new wardrobe for kids every year because of how quickly they outgrow or ruin their clothes. Well one Target-shopping mom shared a money-saving tip on Facebook that is so good, it quickly went viral. The post explains how a loophole in the company’s return policy means you can continually replace clothes you buy at the store. It says:

“Want to save money on your kids’ clothes?! I’ve been doing this for a few years now but clearly, most of you don’t know! Target’s Cat & Jack line has a one year quality guarantee. So when one of the boys rips his pants three months after I bought them, I simply bring them back for a full refund. I walk to the boys section, pick out a brand new pair (often a size larger) and I’m on my way with a brand new pair of pants for free!”

She adds:

“You just need to show customer service the original receipt. I keep my Target receipts in the back of my wallet so I don’t lose them. Just match up the numbers on the clothing tag to the numbers on the receipt. Voila! I just walk up and say, ‘I’d like to return these under the Cat & Jack warranty.’ Never an issue. You’re welcome.”

My mind is blown! ? Did anyone know this?!Posted by Nicole Dvorscak on Monday, November 18, 2019

It seems too good to be true but for now, it’s not! Target indeed has a policy that allows for returns and refunds on its owned brands for up to a year. Since, for now, they don’t specify that “replacing” items is not allowed, the loophole does exist. And it’s not just for Cat & Jack items, there are over 50 in-store brands that it applies to as well.

The policy went into effect in 2015, when Target actually expanded the return policy for their brands, which used to be limited to 90 days. The move came as a way for the company to show how high the quality of their products is, but there is nothing stopping Target from changing the policy again to prevent any kind of misuse of it.

The Standard Deduction Is Rising for 2020: Here’s What You Need to Know

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Taxpayers have a choice when filing their returns: They can take the standard deduction or itemize their deductions. The latter option can be far more time-consuming, and whether it’s worth doing depends on what the standard deduction looks like.

Each year, the IRS determines what the standard deduction is for taxpayers, and in 2020, it’s going up a bit. That’s good news, since the overwhelming majority of people who file taxes don’t itemize, but instead opt for the standard deduction.

The 2020 standard deduction

The standard deduction you’re entitled to will depend on your tax-filing status. Here’s what it looks like going into 2020:

Filing Status2020 Standard DeductionIncrease From 2019
Single or married filing separately$12,400$200
Head of household$18,650$300
Married filing jointly$24,800$400

As you can see, the standard deduction has gone up across all filing categories. It also means that we may see fewer filers itemize on their taxes in the coming year.

Should you itemize or take the standard deduction?

Whether you itemize or go with the standard deduction really boils down to simple math. If you qualify for enough deductions that exceed the standard, then itemizing is generally a no-brainer. This means that if you’re a single tax filer with $13,400 in deductions in 2020, you’re better off itemizing than taking the standard deduction of $12,400.

Things get a little tricky, however, when you’re right on the cusp of itemizing versus taking the standard deduction. Because itemizing can be time-consuming and does open the door to errors, if you’re a single tax filer looking at a total of $12,450 in itemized deductions, opting for the standard deduction could still make a bit more sense. But that’s largely a judgment call.

What can you itemize on your taxes?

Though the 2018 IRS overhaul did away with a number of tax breaks, there are still plenty of opportunities to take deductions. Here are some of the things you can itemize on your tax return:

  • Interest on your mortgage (on a loan up to $750,000, or up to $1 million if you signed your mortgage prior to Dec. 15, 2017)
  • State and local taxes (including state income and property taxes, up to $10,000)
  • Interest on a home equity loan or line of credit (provided it’s used for capital improvements to your home)
  • Charitable donations (including cash donations and the donation of goods, provided you have a receipt for them)
  • Medical expenses that exceed 10% of your adjusted gross income

Keep in mind that there are other expenses you can claim on your taxes without actually itemizing. For example, if you contribute to a traditional IRA for retirement savings, you can deduct the amount you put into that account. The same holds true for student loan interest, educator expenses (up to $250), and self-employment tax.

Don’t assume you won’t itemize

The fact that the standard deduction has gone up is a positive thing for taxpayers. But don’t write off the idea of itemizing just because you’re entitled to a higher standard deduction in 2020. If your eligible expenses climb (say, because you buy a house or move somewhere with higher state income taxes), itemizing could put more money back in your pocket, so you’ll need to see what next year’s expenses look like before making that determination.

A Shockingly Low Number of Women Are Confident About Their Retirement Prospects

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The idea of leaving the workforce for good can be daunting to men and women alike. But new data from Transamerica reveals that the overwhelming majority of women sorely lack confidence in what the future holds for them. In fact, only 12% of women are very confident that they’ll manage to retire and maintain a comfortable lifestyle.

If you’re feeling insecure about retirement, here are a few key moves you can make during your career to improve your prospects during your senior years.

1. Save and invest aggressively

Women have a median $23,000 socked away for retirement. Among younger women — those in their 20s and even 30s — that’s not necessarily cause for alarm, but among women nearing retirement, it’s downright disturbing, especially since women anticipate needing a median $500,000 in savings to live comfortably once they stop working.

If your savings need a serious boost, it’s time to rethink your current lifestyle and make substantial changes. That could mean downsizing to a smaller living space, giving up a vehicle if lower-cost public transportation exists where you live, and spending less money on luxuries like restaurant meals, non-work clothing, and entertainment.

But don’t just carve out more cash for savings; invest your savings wisely for maximum growth, too. If you’re at least 10 years away from retirement, that means loading up on stocks, which have historically delivered much higher returns than bonds. If you invest your savings mostly in stocks over a 10-year window or longer, you’re likely to generate an average annual 7% return, since that’s a bit below the stock market’s average. And if you manage to free up $600 a month for your IRA or 401(k) plan, you’ll grow your nest egg to almost $300,000 over a 20-year period.

2. Maximize your Social Security benefits

An estimated 32% of women expect that Social Security will be their primary source of income during retirement. That’s troubling, because those benefits only replace about 40% of the average worker’s pre-retirement wages, and most seniors need more like 70% to 80% of their former income (sometimes more) to live comfortably. Furthermore, because women are statistically likely to earn less than men, they stand to collect less money from Social Security during retirement, since benefits are calculated based on lifetime wages.

Rather than rely too heavily on Social Security, focus on boosting your nest egg, as discussed just a moment ago. At the same time, take steps to increase your Social Security benefits as much as possible so they serve as a more substantial income source. You can do this by fighting for fair wages during your working years and boosting your job skills to warrant ongoing increases in pay.

Also, aim to put in at least 35 years in the workforce, as your highest-paid 35 years of wages will determine what monthly benefit you’ll collect in retirement. For each year within that 35 that you don’t have an income on file, you’ll have $0 factored into your benefits equation. If you took an extended career break at any point to raise children or for another purpose, you can compensate by extending your time in the workforce later in life.

3. Get out of debt

Carrying debt into retirement can make for a stressful situation when you move over to a fixed income. A good 65% of women cite paying off debt as a financial priority, so if you’re in that boat, aim to pay yours off efficiently. That means focusing on first paying off high-interest debt, like that of the credit card variety, and then moving on to tackle mortgage debt (which is not only considered the healthy kind to have but can also result in some lucrative tax breaks).

If you’re worried about maintaining a decent lifestyle in retirement, do everything in your power to plan well for that milestone. Save more money, invest your nest egg wisely, boost your Social Security benefits, and eliminate as much existing debt as you can. Once you do, you’re likely to find that your outlook on retirement improves tremendously.