I’ve been meaning to take a look at the Federal Reserve and the
impact the now 17 consecutive interest rate increases have had
on the equity market but, alas, upon review the verdict is
basically zero; until Ben Bernanke’s May pronouncement, that
is.
Otherwise, Wall Street hasn’t been spooked by the Fed, for the
most part, despite all the inter-meeting chatter, primarily because
under former Chairman Alan Greenspan the Fed did a great job
of telegraphing its moves well ahead of time; thus there were few
actual surprises. [Greenspan himself, however, was clearly
surprised at the tepid reaction on the long end of the yield curve,
which helped allow the real estate bubble to expand further…at
least some of us feel that way.]
Anyway, time is limited here so if I start on a project I have to
run with the result, even if it isn’t earth-shattering.
Following are the dates of the Fed rate moves, all a quarter-point,
the closing price of the S&P 500 for both the day before and the
day of the Fed’s action, as well as the S&P’s closing values one
and two weeks afterwards.
For example, the Fed increased the funds rate from 1 to 1.25
percent on June 30, 2004, the S&P 500 closed the day before at
1136 and 1140 the day of the move, was 1118 one week later and
1111 two weeks later.
6/30/04….1.00-1.25…(1136) 1140…1118 / 1111
8/10/04….1.25-1.50…(1065) 1079…1081 / 1096
9/21/04….1.50-1.75…(1122) 1129…1110 / 1134
11/10/04…1.75-2.00…(1164) 1162…1181 / 1181
12/14/04…2.00-2.25…(1198) 1203…1205 / 1213
2/2/05……2.25-2.50…(1189) 1193…1191 / 1210
3/22/05….2.50-2.75…(1183) 1171…1165 / 1181
5/3/05……2.75-3.00…(1162) 1161…1166 / 1173
6/30/05….3.00-3.25…(1199) 1191…1197 / 1226
8/9/05……3.25-3.50…(1223) 1231…1219 / 1217
9/20/05….3.50-3.75…(1231) 1221…1215 / 1214
11/1/05….3.75-4.00…(1207) 1202…1218 / 1229
12/13/05…4.00-4.25…(1260) 1267…1259 / 1256
1/31/06….4.25-4.50…(1285) 1280…1254 / 1275*
3/28/06….4.50-4.75…(1301) 1293…1305 / 1286**
5/10/06….4.75-5.00…(1325) 1322…1270 / 1258
6/29/06….5.00-5.25…(1246) 1272…1274…?
*Alan Greenspan’s last meeting as chairman.
**Ben Bernanke’s first meeting as chairman.
Source: Federalreserve.gov and my own collection of data.
—
The State of the City
Each year “Crain’s New York Business” releases a slew of
“market facts” on the state of New York City’s economy. Since
New York is still the financial capital of the world (at least to us
Americans), it’s obviously a pretty good barometer.
Miscellaneous Statistics
–New York City’s population:
White…34.4%
Hispanic / Latino…28.6
Black…24.3
Asian…11.3
–Estimated Gross City Product…$454 billion
–Employment:
Securities Industry…2000 (peak)…195,400; 2005…170,800
[Employment bottomed in 2003 at about 160,000.]
Leisure & Travel Industry…2000…256,700; 2005…276,800
–Visitor spending in NYC
2000…$17.0 billion
2002…$14.1 billion [post-9/11 low]
2005…$22.3 billion [est.]
–Market share for overseas travelers’ top U.S. destinations in
2004 (latest available data):
New York…25.4%
Los Angeles…11.2
Miami…10.8
Orlando…9.6
Honolulu/Oahu…9.2
San Francisco…9.2
Las Vegas…7.7
Washington, D.C.…5.2
Chicago…4.6
Boston…4.1
–Leading Trade Partners thru New York / New Jersey ports:
Imports (2005)
1. China 2. Italy 3. Germany 4. India 5. Brazil
Exports
1. China 2. India 3. United Kingdom 4. Japan 5. Germany
–In 1998, imports from China thru New York / New Jersey
ports approximated 1,000,000 metric tons. In 2005, it was close
to 4,000,000. Over the same period, exports to China have
climbed from 250,000 metric tons to 1,900,000.
–Manhattan Co-op Prices (Upper East Side)
Two-bedroom
2001…$834,000
2005…$1,345,000
–Lastly, I just found the following interesting.
Leading causes of death for men in NYC:
Heart disease…36.1%
Cancer…24.1
Influenza / pneumonia…4.9
HIV…3.4
Diabetes…2.9
All others…28.6
Leading causes of death for women:
Heart disease…42.4%
Cancer…23.3
Influenza / pneumonia…5.5
Cerebrovascular…3.4
Chronic lower respiratory disorders…3.1
All others…22.3
—
Wall Street History returns next week.
Brian Trumbore
