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Clearly, Not Everyone Is Getting Rich Off The Stock Market

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Well, the NY Fed was out today with its Quarterly Report on Household Debt and Credit for Q4 2017. Clearly, Americans are in a lot of debt. Take a look. Just a couple of quick hits from the report. Total U.S. household debt rose $193 billion in the 4th quarter, to a new all-time peak of $13.15 trillion. That's 17.9% above the most recent trough in Q2 2013. Broken down by segment, what do you suppose was the largest gain in percentage terms? Credit cards, with a 3.2% increase. In the picture above, the widening gap represented by the red arrows reflects the fact that non-housing debt is rising at a faster pace than housing debt. Here's what's troubling about that. Below is a picture of the stock market, as represented by the S&P 500 index, over that same period; from the most recent credit trough in Q2 2013 to the end of 2017. And thus, the title of this article. Over that period, the S&P 500 index rose by 75%; from roughly 1,600 to 2,800. Apparently, ho...

Action Alert: Consider VIG

Today's action alert features the Vanguard Dividend Appreciation ETF.

Have a quick look at the chart below. It reveals that, since March 2, 2015, this ETF has fallen 4.24% against only 1.32% on the S&P 500 index.


Click to Enlarge


Likely, this reflects the notion that dividend stocks are a little out of favor right now, due to the potential for rising interest rates. At the same time, this ETF tracks an index comprised of companies that have a record of growing their dividends year over year. The market may face continuing headwinds as the year continues and these sorts of stocks have a track record of holding up well in such an environment.

Suggest evaluating whether now may be a good time to take advantage of what may be some temporary weakness and add to your position.


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Disclosure: I am not a registered investment advisor or broker/dealer. Readers are cautioned that the material contained herein should be used solely for informational purposes, and are encouraged to consult with their financial advisor respecting the applicability of this information to their personal circumstances. Investing involves risk, including the loss of principal. Readers are solely responsible for their own investment decisions.

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