I hope you enjoy this edition of By the Numbers.
Have a great week! Brett Lightner
By The Number$ - Monday, March 16, 2009
1. DURING THE LAST 5 MONTHS - During the worst bear market ever for the S&P 500, the stock index fell 86.2% over a 33-month period (I.e., 9/06/29 to 6/01/32). More than half of the 86.2% decline occurred during the last 5 months of the 33-month period. From 12/31/31 to 6/01/32, the S&P 500 fell 45.8%. From its all-time high set on 10/09/07, the S&P 500 has fallen 51.7% over the last 17 months to last Fridays close. In the last 5 months, the S&P 500 has fallen 24.6%. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the US stock market (source: BTN Research).
2. OBAMAS MINI-BEAR - Today is President Barack Obamas 56th day in office. From the close of business on the last trading day before Obama took office to last Fridays close, the S&P 500 is down 10.5% on a total return basis (source: BTN Research).
3. NOT HAPPY - A weekly survey of stock investors indicated 70% of them were bearish as of 3/04/09, the highest bearish measurement ever recorded by this study (source: American Association of Individual Investors).
4. A FACTOR? - Theuptick rule requires a stock that is being sold short must be sold at a price above the last sales price of the stock. Some, but not all, market watchers believe the elimination of the uptick rule on 7/06/07 has contributed to the stock bear market that began in October 2007. The uptick rule was first adopted by the Securities and Exchange Commission in 1938 (source: Wall Street Journal).
5. BIGGER AND BIGGER - The first budget plan presented to Congress by President George Bush (# 43) on 4/09/01 was for fiscal year 2002 and anticipated $1.96 trillion of spending for the 12 months ending 9/30/02. The first budget plan presented to Congress by President Barack Obama on 2/26/09 was for fiscal year 2010 and it anticipates $3.55 trillion of spending for the 12 months ending 9/30/10 (source: White House).
6. CENTRAL BANK - The Federal Reserve will hold a 2-day meeting that ends on Wednesday of the upcoming week (3/18/09). The Fed has either lowered rates or kept them unchanged following each of its last 23 meetings. This week�s meeting is the 2nd of 8 scheduled for the calendar year (source: Federal Reserve).
7. JOBS - The 651,000 job losses that the US suffered during February 2009 were the 5th largest monthly total ever reported. The last 3 months (December-January-February) rank as the 3rd, 4th and 5th worst months ever. The worst ever (job losses of 1.97 million) occurred in September 1945 (source: Department of Labor, Financial Times).
8. JUDGES DECISION - Bankruptcy judges have had the authority since 1978 to reduce the principal balance on loans secured by second homes, boats and cars, but not by the debtors primary residence. The House passed legislation on 3/06/09 that would allow judges to rewrite a home mortgage loan and reduce the principal amount owed. The bill will now be debated and voted on in the Senate (source: Los Angeles Times).
9. WAY UP, WAY DOWN - The median sales price of a home sold in San Jose, CA (the nations 10th largest city) is down 38% in the last 13 months (source: Santa Clara County Association of Realtors, USA Today).
10. IN TROUBLE - 1 out of every 9 mortgages in the USA was at least 30 days late with their monthly payment or was in the foreclosure process as of 12/31/08. One year earlier (12/31/07), 1 out of every 13 mortgages was either late or in foreclosure (source: Mortgage Bankers Association).
11. NET WORTH - The total net worth of Americans was $51.5 trillion as of 12/31/08, down 18% in the last year, reaching its lowest level since 9/30/05 (source: Federal Reserve).
12. UP IN THE AIR - The worlds airlines lost $8 billion in calendar year 2008, half of that in the 4th quarter alone (source: International Air Transport Association).
13. OIL PRICES - OPEC ministers met yesterday in Vienna, Austria to consider its 4th production cut in the last 6 � months. OPEC believes a �reasonable� oil price is between $60-80 a barrel. The price of oil closed last Friday at $46.25 a barrel (source: Financial Times).
14. BIG APPETITE - The USA consumes as much oil per day as does the next 5 largest oil-consuming countries in the world combined (US Energy Information Administration, Wall Street Journal).
15. SMELLY - The $410 billion emergency spending bill that passed the House last month and was approved in the Senate last Tuesday will keep the government running through 9/30/09. The bill includes $1.8 million to research swine odor and manure management at a Department of Agriculture facility in Ames , IA. The state of Iowa has 20 million hogs, 25% of all hogs in the nation (source: Media General).
Brett Lightner
T:(310) 391-4050
C:(310) 968-7568
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American Capital Mortgage Co., Inc.
11600 Washington Pl., #206
Los Angeles, CA 90066
www.socalmortgage.com.
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