INSIGHTS FROM FIRST FOUNDATION

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The Week Ahead – Jobs, Jobs & Jobs

Welcome to “The Week Ahead” where we take a moment to provide our thoughts on what we can expect in markets and the economy during the upcoming week.

Lost in the latest trade war chatter (Canada, Mexico, and EU this time) was that Friday’s employment report was solid once again. The unemployment rate is now at an 18-year low at 3.8%. The underutilization rate (also known as “U-6”) – which takes the unemployment rate and then includes those discouraged job seekers who have given up looking for work, people who have gone back to school or have become disabled, and those that are underemployed (those who have to settle for part-time jobs although they prefer full-time jobs) – decreased to 7.60%. The last time the U-6 was this low? May 2001.  Random flashback factoid, 2001 was the year America Online and Time Warner merged to become AOL Time Warner (anyone else miss hearing “you’ve got mail”?). Wage growth also beat expectations as it grew 0.3% in May to a year-over-year rate of 2.7%. With this data point, it is hard to see the FOMC not hiking at June’s meeting in two weeks. 

The week ahead will be relatively quiet as investors will be monitoring the ISM non-manufacturing index to see if it can reverse course after three consecutive months of declines. The NBA Finals heads to Cleveland as the Warriors hold serve and lead the Cavaliers 2-0!

Data deck for June 2 – June 8:

Date

Indicator

Period

June 4

Durable Goods Orders

April

June 4

Factory Orders

April

June 5

JOLTS Job Openings

April

June 5

ISM Non-Manufacturing

May

June 6

Trade Balance

April

June 6

Nonfarm Productivity

1Q18

June 7

Initial Jobless Claims

----

June 7

Consumer Credit

April

June 8

Wholesale Inventories

April

 

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Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by First Foundation Advisors), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from First Foundation Advisors. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. First Foundation Advisors is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the First Foundation Advisors’ current written disclosure statement discussing our advisory services and fees is available for review upon request. Please Note: First Foundation Advisors does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to First Foundation Advisors’ web site or incorporated herein, and takes no responsibility therefore. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

Andrew Chan, CAIA, Portfolio Strategist
About the Author
Andrew Chan, CAIA, Portfolio Strategist
Mr. Chan serves on the investment team and is responsible for conducting investment manager research and portfolio construction. As a member of the investment committee, he provides market commentary and investment insights. Mr. Chan’s responsibilities include overseeing client portfolios, calculating risk metrics, conducting the rebalancing of client portfolios, and evaluating the selection of new investment managers. With over 10 years of wealth management experience, Mr. Chan has played key roles across various aspects of investment and wealth management. Prior to joining First Foundation Advisors, Mr. Chan was most recently a portfolio manager at U.S. Trust where, in addition to his daily responsibilities, he served on numerous internal committees including the investment manager committee, the portfolio model committee, and the strategic technology committee. He also served on the in-house strategic consultant committee reporting directly to the President of U.S. Trust. Mr. Chan is a graduate of the Wharton School Executive Program on Investment Management and holds a Bachelor of Arts degree in Business Administration from the University of California, Riverside. He is a Chartered Alternative Investment Analyst (CAIA). Mr. Chan serves on the executive board for CAIA Los Angeles and is the Interim President for the association. Read more
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