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You can find reports from our Investment and Research team, timely and informative financial planning topics from our Wealth Management team, and deeper dives on various important topics in our white papers from any team member. Read online, share with friends, or download for your convenience.

As we are now about halfway through companies reporting their second quarter earnings reports, we wanted to take a look at how different sectors of the market have performed. While earnings growth has been strong overall, there have been wide swings in stock prices upon the release of their financials. The most notable occurrence of this earnings season has been the performance of the technology sector which has been plagued by sizable selloffs in big names such as Netflix, Facebook, Twitter, and Intel.

Q2 2018 US GDP Growth
The first estimate of second quarter GDP growth showed that the U.S. economy grew at a solid pace, driven in part by the recently enacted tax cut. The economy grew 4.1% in the second quarter, the strongest reading since the third quarter of 2014. The largest contributor to growth was a 4.0% increase in consumer spending. Business investment growth was also solid at 7.3%. However, a drawdown in inventories offset the entirety of this underlying investment growth. Government expenditures were another positive contributor, increasing 2.1% during the quarter. The final component of GDP, net exports, added 1.06% to growth, as exports surged 9.3%. While at first glance the export growth appears to be a very positive piece of data, it is an aberration that may be unsustainable moving forward. Almost all the growth in exports derived from a surge of soybean and other agricultural shipments ahead of pending tariffs beginning on July 1st. This means that the surge is likely to be reversed next quarter. 

Lynda FranklinIt’s hard to believe but July 25th was my 10-year anniversary with Allegiant Private Advisors, an accomplishment I’m blessed and proud to reach.  I look forward to celebrating many more years.

I am one of three APA team members who was born and raised in Sarasota. You’ll probably find out who the others are when they write their bio a little later, I’m sure!  I also share the same birthday as another team member; not the same year, though. Unfortunately, I’m old enough to be their mother!

I grew up during a quieter, less populated time in Sarasota with no idea what ‘little Sarasota’ would become.  I used to ride my horse along McIntosh when it was a dirt road.  As a matter of fact, our horses were stabled at a pasture off Bahia Vista that is now a subdivision I reside in.  In the 70s, I rode western saddle and competed professionally in the Central Florida Horseman’s Association circuit for a year on a beautiful dun (buckskin) quarter horse our family owned named Taffy. Along with approximately 100 trophies and ribbons I won that year I also won Champion in Western Pleasure and Reserve Champion in Western Horsemanship.  It was an incredible experience I cherish. 

After graduating from Sarasota High School, I attended an accounting class at what is now called Suncoast Technical College, thinking I was going to become an accountant. I was working at the courthouse as a felony division clerk at that time and became interested in law, so I took a paralegal class at MCC, now State College of Florida. However, life had a different path in mind for me.  So over the years, though I’ve done many things, the professional field and people-facing jobs have been my calling. 

APA Jones 3x4LOAllegiant Private Advisors, an independent firm in Sarasota, Fla., today announces that its Chief Investment Officer Benjamin W. Jones, CFP®, AIF®, has been named to the Forbes’ Top 1,000 Next-Generation Wealth Advisors list for 2018. The list is published on Forbes.com.

Jones has been managing assets for private individuals, families, and charitable organizations for over a decade. As a Principal and Chief Investment Officer of Allegiant Private Advisors, he leads the firm’s Investment Committee. Jones is responsible for establishing the firm’s overall investment strategy, security selection, portfolio management, and oversees research activities. 

Wayne Bloom, CEO of Commonwealth Financial Network®, Allegiant Private Advisors’ Registered Investment Adviser–broker/dealer, said, “Congratulations to Ben Jones on being recognized by Forbes. This vibrant advisor brings new ideas and fresh perspectives to the industry and represents the next generation of independent advice for investors. We are proud to see Ben recognized, feel fortunate to have Allegiant Private Advisors as part of the Commonwealth community, and remain committed to serving this growing practice with the intuitive, integrated technology, tools, and resources that drive productivity and keep their business client forward.”

As mentioned in previous editions of our weekly charts, the current trade dispute has massive implications for both China and the U.S.; however, to this point, much of the tit for tat retaliation has been in the form of tariffs on the opposing country’s imports.

The chart below displays the portion of unemployed people who voluntarily left their previous job. As can be seen in the chart, a declining trend usually coincides with an economic downturn (the gray bars indicate recessions). This is due to the fact that during economic downturns, individuals know that other employers are likely not hiring, so they hold on to the job that they have. On the other side of the coin, an upward trend can be viewed as a positive sign of confidence in the job market, as workers feel confident enough in the economy to quit their job and pursue higher quality employment.

In an upcoming IMF working paper entitled “Global Market Power and Its Macroeconomic Implications,” the authors discuss the negative implications of the rise of corporate giants. As the graph below shows, the average markups on goods and services in advanced economies, which has accelerated over the past decade, has increased by 43% since the 1980s vs. only about 5% in less developed economies. This concentration of market power has several negative implications. 

Chart of the Week: Home Affordability

The chart above compares median household income relative to the income needed to purchase a median-priced home. A higher reading means that homes are more affordable, while a lower reading indicates that it is more difficult for Americans to keep up with housing costs. As one would expect, in the late 2000s at the height of the housing bubble, home buyer affordability was at a record low. In the years that followed, affordability skyrocketed as real estate prices crashed. Now, a decade removed from the depths of the housing crisis, real estate prices have rebounded, and affordability is once again falling. 

It seems that every American generation since the baby boomers have adopted the same complaint at some point in their working career. It is typically something along the lines of, “My generation will be the first one to pay into Social Security and never be able to draw a check from it.” While generations in the past have all successfully recouped the money that they paid into the system, this complaint now seems to be becoming more of a reality.