Category Archives: the numbers

The Numbers & “Heat Map”

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THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 U.S. GDP growth decelerated to a 2% annualized pace in Q3. The slowdown was driven primarily by supply chain constraints. Economists expect a modest acceleration in Q4.

CORPORATE EARNINGS

POSITIVE

 With 95% of S&P 500 companies having reported Q3 results, sales and earnings are up 17.5% and 39%, respectively. However, company commentary suggests that the supply chain has been and will continue to be problematic in the coming quarters.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 4.6%, as of October. The labor market is very tight at present as many employers, particularly in the Leisure and Logistics sectors, are struggling to fully staff because the labor participation rate remains below pre-COVID levels. The labor shortage is one of the causes of the global supply chain glut.

INFLATION

NEUTRAL

 CPI rose 6.2% year-over-year in October, the highest increase since 1990, driven by the global supply chain backlog. Will inflation be transitory or permanent?

FISCAL POLICY

POSITIVE

 A $1.2 trillion infrastructure bill was passed by Congress. $1.75 trillion spending bill passed by Congress and also sent to Senate for revisions.

MONETARY POLICY

POSITIVE

 The Fed will begin bond tapering by November’s end. By mid-2022, all Fed bond purchases will halt. The Fed’s bong buying program works to keep interest rates low. Inflation concerns are persisting, and some are calling for faster tapering and high rates.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 COVID-19 cases are surging in parts of EU (Austria and Germany) leading to further lockdowns.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions are hampering the economy; however, demand remains very strong. While global logistics are operating far below normal efficacy, it appears the supply chain is slowly improving and may reach normalcy by mid-to-late-2022.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 U.S. GDP growth decelerated to a 2% annualized pace in Q3. The slowdown was driven primarily by supply chain constraints. Economists expect a modest acceleration in Q4.

CORPORATE EARNINGS

POSITIVE

 With 92% of S&P 500 companies having reported Q3 results, sales and earnings are up 17.5% and 39%, respectively. However, company commentary suggests that the supply chain has been and will continue to be problematic in the coming quarters.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 4.6%, as of October. The labor market is very tight at present many employers, particularly in the Leisure and Logistics sectors, are struggling to fully staff because the labor participation rate remains below pre-COVID levels. The labor shortage is one of the causes of the global supply chain glut.

INFLATION

NEUTRAL

 CPI rose 6.2% year-over-year in October, the highest increase since 1990, driven by the global supply chain backlog.

FISCAL POLICY

POSITIVE

 A $1.2 trillion infrastructure bill was passed by Congress. An additional $2 trillion tax and stimulus bill proposed by the Democrats will next be voted on by the House & Senate.

MONETARY POLICY

POSITIVE

 The Fed will begin bond tapering by November’s end. By mid-2022, all Fed bond purchases will halt. The Fed’s bong buying program works to keep interest rates low.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions are hampering the economy; however, demand remains very strong. While global logistics are operating far below normal efficacy, it appears the supply chain is slowly improving and may reach normalcy by mid-to-late-2022.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 U.S. GDP growth decelerated to a 2% annualized pace in Q3. The slowdown was driven primarily by supply chain constraints. Economists expect a modest acceleration in Q4.

CORPORATE EARNINGS

POSITIVE

 With 55% of S&P 500 companies having reported Q3 results, sales and earnings are up 15.5% and 26.5%, respectively. However, company commentary suggests that the supply chain has been and will continue to be problematic in the coming quarters.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 4.6%, as of October. The labor market is very tight at present, as many employers, particularly in the Leisure and Logistics sectors, are struggling to fully staff because the labor participation rate remains below pre-COVID levels. The labor shortage is one of the causes of the global supply chain glut.

INFLATION

NEUTRAL

 CPI rose 5.4% year-over-year in September, driven by the global supply chain backlog.

FISCAL POLICY

POSITIVE

 A $1.2 trillion infrastructure bill was passed by Congress on Friday, and now only awaits President Biden’s signature. Biden, the originator of the bill, is fully expected to support the package. An additional $2 trillion tax and stimulus bill proposed by the Democrats will next be voted on by the House & Senate.

MONETARY POLICY

POSITIVE

 The Fed will begin bond tapering by November’s end. By mid-2022, all Fed bond purchases will halt. The Fed’s bong buying program works to keep interest rates low.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions are hampering the economy; however, demand remains very strong. While global logistics are operating far below normal efficacy, it appears the supply chain is slowly improving and may reach normalcy by mid-to-late-2022.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 U.S. GDP growth decelerated to a 2% annualized pace in Q3. The slowdown was driven primarily by supply chain constraints. Economists expect a modest acceleration in Q4.

CORPORATE EARNINGS

POSITIVE

 With 55% of S&P 500 companies having reported Q3 results, sales and earnings are up 15.5% and 26.5%, respectively. However, company commentary suggests that the supply chain has been and will continue to be problematic in the coming quarters.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 4.8%, as of September. The labor market is very tight at present, as many employers, particularly in the Leisure and Logistics sectors, are struggling to fully staff. The labor shortage is one of the causes of the global supply chain glut.

INFLATION

NEUTRAL

 CPI rose 5.4% year-over-year in September, driven by the global supply chain backlog.

FISCAL POLICY

POSITIVE

 A bill to lift the U.S. debt ceiling by $480 billion – which should provide enough headroom for government operations until December 3 – was passed.

MONETARY POLICY

POSITIVE

 In recent communications, the Fed has indicated bond tapering may begin by the end of 2021 while rate hikes could commence by the end of 2022. Nonetheless, monetary policy remains relatively accommodative with rates at historical lows.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions are hampering the economy; however, demand remains very strong. The hold-ups should ease progressively over time.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 September retail sales surprised to the upside, increasing 0.7% month-over-month (m/m) and 13.9% year-over-year (y/y). Economists expected September’s retail sales to decline slightly m/m.

CORPORATE EARNINGS

POSITIVE

 With 23% of S&P 500 companies having reported Q3 results, sales and earnings are up 15% and 32%, respectively. However, company commentary suggests that the supply chain will be problematic in the coming quarters.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 4.8%, as of September. The labor market is very tight at present, as many employers, particularly in the Leisure and Logistics sectors, are struggling to fully staff. The labor shortage is one of the causes of the global supply chain glut.

INFLATION

NEUTRAL

 CPI rose 5.4% year-over-year in September, driven by the global supply chain backlog.

FISCAL POLICY

POSITIVE

 A bill to lift the U.S. debt ceiling by $480 billion – which should provide enough headroom for government operations until December 3 – was passed.

MONETARY POLICY

POSITIVE

 In recent communications, the Fed has indicated bond tapering may begin by the end of 2021 while rate hikes could commence by the end of 2022. Nonetheless, monetary policy remains relatively accommodative with rates at historical lows.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions are hampering the economy; however, demand remains very strong. The hold-ups appear primarily transitory and should ease progressively over time.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 September retail sales surprised to the upside, increasing 0.7% month-over-month (m/m) and 13.9% year-over-year (y/y). Economists expected September’s retail sales to decline slightly m/m.

CORPORATE EARNINGS

POSITIVE

 S&P 500 Q3 earnings season is just kicking off. With <10% of companies having reported, sales and earnings are up 15% and 29%, respectively. However, company commentary suggests that the supply chain will be problematic in the coming quarters.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 5.2%. In August, new job creation was disappointing, but jobless claims were as low as they have been since March 2020.

INFLATION

NEUTRAL

 CPI rose 5.4% year-over-year in September, driven by the global supply chain backlog.

FISCAL POLICY

POSITIVE

 A bill to lift the U.S. debt ceiling by $480 billion – which should provide enough headroom for government operations until December 3 – was passed this week.

MONETARY POLICY

POSITIVE

 In recent communications, the Fed has indicated bond tapering may begin by the end of 2021 while rate hikes could commence by the end of 2022. Nonetheless, monetary policy remains relatively accommodative with rates at historical lows.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions caused by the Delta variant are hampering the economy, however, demand remains very strong. While supply bottlenecks will likely arise over time as new strains surface, the hold-ups appear primarily transitory and should ease progressively in a post-COVID world.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 August retail sales surprised to the upside, increasing 0.7% month-over-month, indicating that the Delta variant has not had a material impact on the U.S. economy.

CORPORATE EARNINGS

POSITIVE

 S&P 500 Q2 sales and earnings grew an astonishing 25% and 89% respectively, when compared to the heavily depressed figures from Q2 2020.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 5.2%. In August, new job creation was disappointing, but jobless claims were as low as they have been since March 2020.

INFLATION

NEUTRAL

 CPI rose 5.3% year-over-year in August; CPI rose 5.4% in both June and July respectively. Fed Chairman Jay Powell is resolute that the high inflation is transitory and will decelerate as global supply chain bottlenecks resolve. Meanwhile, consumers expect CPI to be 5.2% over the next 12 months.

FISCAL POLICY

POSITIVE

 Congress came to a resolution to avoid the government shutdown through early December, but the debt ceiling still looms, which Treasury Secretary Yellen believes will be reached on October 18. Nonetheless, Democrats can adjust the debt ceiling without Republican support through budget reconciliation, so it seems likely a solution will be reached.

MONETARY POLICY

POSITIVE

 In recent communications, the Fed has indicated bond tapering may begin by the end of 2021 while rate hikes could commence by the end of 2022. Nonetheless, monetary policy remains relatively accommodative with rates at historical lows.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 Supply chain disruptions caused by the Delta variant are hampering the economy, however, demand remains very strong. While supply bottlenecks will likely arise over time as new strains surface, the hold-ups appear primarily transitory and should ease progressively in a post-COVID world.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 August retail sales surprised to the upside, increasing 0.7% month-over-month, indicating that the Delta Variant has not had a material impact on the U.S. economy.

CORPORATE EARNINGS

POSITIVE

 S&P 500 Q2 sales and earnings grew an astonishing 25% and 89% respectively, when compared to the heavily depressed figures from Q2 2020.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 5.2%. In August, new job creation was disappointing, but jobless claims were as low as they have been since March 2020.

INFLATION

NEUTRAL

 CPI rose 5.3% year-over-year in August; CPI rose 5.4% in both June and July respectively. Fed Chairman Jay Powell is resolute that the high inflation is transitory and will decelerate as global supply chain bottlenecks resolve. Meanwhile, consumers expect CPI to be 5.2% over the next 12 months.

FISCAL POLICY

POSITIVE

 The Senate passed a $1 trillion infrastructure package. The bill is expected to be voted on by The House by the end of this year.

MONETARY POLICY

POSITIVE

 In recent communications, the Fed has indicated bond tapering may begin by the end of 2021 while rate hikes could commence by the end of 2022. Nonetheless, monetary policy remains relatively accommodative with rates at historical lows.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful economic impact.

ECONOMIC RISKS

NEUTRAL

 With multiple vaccines in distribution and accommodative fiscal and monetary policies in place, 2021 is shaping up as one of the strongest economic years on record. The primary risk at present is that of persistent inflation which begets higher interest rates.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 July retail sales declined 1.1% vs. June 2021 but are 15.8% higher than July 2020.

CORPORATE EARNINGS

POSITIVE

 S&P 500 Q2 sales and earnings grew an astonishing 25% and 89%, respectively, when compared to the heavily depressed figures in Q2 2020.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 5.2%. In August, new job creation was disappointing, but jobless claims were as low as they have been since March 2020.

INFLATION

NEUTRAL

 Inflation remained at 5.4% year-over-year in July, the same reading as in June. Fed Chairman Jay Powell believes that the high inflation is transitory and will decelerate as global supply chain bottlenecks resolve.

FISCAL POLICY

POSITIVE

 The Senate passed a $1 trillion infrastructure package. The bill is expected to be voted on by The House by the end of this year.

MONETARY POLICY

POSITIVE

 The Federal Reserve has indicated that it does not plan to increase interest rates until 2023.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEUTRAL

 Although the Taliban’s control in Afghanistan is concerning, it is unlikely to have a meaningful global economic impact.

ECONOMIC RISKS

NEUTRAL

 2021 is shaping up as one of the strongest economic years on record. The primary risk at present is that of persistent inflation which begets higher interest rates.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.

The Numbers & “Heat Map”

Posted on by

THE NUMBERS
Sources: Index Returns: Morningstar Workstation. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. Three, five and ten year returns are annualized. Interest Rates: Federal Reserve, Mortgage Bankers Association.

MARKET HEAT MAP
The health of the economy is a key driver of long-term returns in the stock market. Below, we assess the key economic conditions that we believe are of particular importance to investors.

US ECONOMY

CONSUMER HEALTH

POSITIVE

 July retail sales declined 1.1% vs. June 2021 but are 15.8% higher than July 2020.

CORPORATE EARNINGS

POSITIVE

 S&P 500 Q2 sales and earnings grew an astonishing 25% and 89%, respectively, when compared to the heavily depressed figures from Q2 2020.

EMPLOYMENT

POSITIVE

 The unemployment rate is down to 5.2%. In August, new job creation was disappointing, but jobless claims were as low as they have been since March 2020.

INFLATION

NEUTRAL

 Inflation remained at 5.4% year-over-year in July, the same reading as in June. Fed Chairman Jay Powell believes that the high inflation is transitory and will decelerate as global supply chain bottlenecks resolve.

FISCAL POLICY

POSITIVE

 The Senate passed a $1 trillion infrastructure package. The bill is expected to be voted on by The House by the end of this year.

MONETARY POLICY

POSITIVE

 The Federal Reserve has indicated that it does not plan to increase interest rates until 2023.

GLOBAL CONSIDERATIONS

GEOPOLITICAL RISKS

NEGATIVE

 The Taliban’s control in Afghanistan is causing uncertainty and unrest around the globe.

ECONOMIC RISKS

NEUTRAL

 With multiple vaccines in distribution and accommodative fiscal and monetary policies in place, 2021 is shaping up as one of the strongest economic years on record. The primary risk at present is that of persistent inflation which begets higher interest rates.

The “Heat Map” is a subjective analysis based upon metrics that VNFA’s investment committee believes are important to financial markets and the economy. The “Heat Map” is designed for informational purposes only and is not intended for use as a basis for investment decisions.