Weekly Economic Update for the Week of May 17, 2010

C.W. Copeland & Associates presents

Weekly Economic Update for the Week of May 17, 2010

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Quote of the week. “Education is not the filling of a pail, but the lighting of a fire.”– William Butler Yeats

Gold soars, euro slips, rumors plague EU. Wall Street watched Europeclosely last week; investors initially loved the almost-trillion-dollar debt rescue plan from the International Monetary Fund and the European Union, but then wondered if its austerity measures would slow growth. The euro hit an 18-month low Friday as rumors floated that certain EU nations might ditch the currency. Gold, meanwhile, settled at $1,227.80 an ounce Friday – prices are up about 16% since early February.^1,2

Retail sales up 0.4% in April. This marks seven consecutive months of gains. Additionally, the Census Bureau said April 2010 retail sales figures were 8.8% improved from April 2009.³

Reuters: a gain in consumer sentiment. In May’s preliminary Reuters/University of Michiganpoll, the index read 73.3, better than April’s 72.2. The survey’s one-year inflation expectations index read 3.1%, the highest mark in 11 months.⁴

Industrial output on the rise. On Friday, the Federal Reserve noted a 0.8% gain in industrial production for April. This follows up a 0.2% advance recorded in March.³

Up, down … up, down … and finally, up. Big swings ruled the market last week – but make no mistake, it was a winning week for equities. At the Friday close, the Dow stood at 10,620.16 after a 2.31% advance across five trading days. Last week, the NASDAQ rose 3.58% while the S&P 500 gained 2.23%. The Russell 2000 gained 6.28% last week.⁵

% Change	Y-T-D	1-Yr Chg	5-Yr Avg	10-Yr Avg
DJIA	+1.84	+27.47	+0.95	-0.17
NASDAQ	+3.42	+38.93	+3.74	-3.49
S&P 500	+1.85	+27.17	-0.32	-2.18
Real Yield	5/14	1 Yr Ago	5 Yrs Ago	10 Yrs Ago
10YrTIPS	1.26%	1.68%	1.66%	4.34%

(Source: CNBC.com, BigCharts.com, ustreas.gov, bls.gov, 5/14/10)^5,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be

invested into directly. These returns do not include dividends.

Riddle of the week. What number logically comes next in this series: 2, 3, 5, 9, 17, __.

Contact my office or see next week’s Update for the answer.

Last week’s riddle: At a class reunion, everyone shakes hands exactly once with every person present. That results in a total of 28 handshakes. In total, how many people are at the reunion?

Last week’s riddle answer: 8 people. (8 x (8 - 1): 2 = 28) or (7 + 6 + 5 + 4 + 3 + 2 + 1 = 28).

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Citations.

1 - nytimes.com/2010/05/15/business/15markets.html?src=me [5/14/10]

2 - online.wsj.com/article/BT-CO-20100514-713372.html?mod=WSJ_latestheadlines [5/14/10]

3 - npr.org/blogs/thetwo-way/2010/05/retail_sales_rose_04_last_mont.html [5/14/10]

4 - cnbc.com/id/37148851/ [5/14/10]

5 - cnbc.com/id/37155847 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=5%2F14%2F09&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=5%2F14%2F09&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=5%2F14%2F09&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=5%2F13%2F05&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=5%2F13%2F05&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=5%2F13%2F05&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=5%2F15%2F00&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=5%2F15%2F00&x=0&y=0 [5/14/10]

6 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=5%2F15%2F00&x=0&y=0 [5/14/10]

7 - ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [5/14/10]

7 - ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [5/14/10]

8 - treasurydirect.gov/instit/annceresult/press/preanre/2000/ofm11200.pdf [1/12/00]

Regards,

C.W. Copeland
"Your Personal CFO"
C.W. Copeland & Associates
Lifestyle Management Advisors
3401 Norman Berry Drive
Suite 253
East Point, GA 30344
404.567.3275 (direct)
404.601.9534 (fax)
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