January 14, 2016 Newsletter

Dear Friends,

Tangents:

Here’s another article from Sunday’s (January 10, 1916) NY Times that is worth reading:

You Don’t Need More Free Time

                               -by Cristobal Young

AMERICANS work some of the longest hours in the Western world, and many struggle to achieve a healthy balance between work and life. As a result, there is an understandable tendency to assume that the problem we face is one of quantity: We simply do not have enough free time. “If I could just get a few more hours off work each week,” you might think, “I would be happier.”

This may be true. But the situation, I believe, is more complicated than that. As I discovered in a study that I published with my colleague Chaeyoon Lim in the journal Sociological Science, it’s not just that we have a shortage of free time; it’s also that our free time, in order to be satisfying, often must align with that of our friends and loved ones. We face a problem, in other words, ofcoordination. Work-life balance is not something that you can solve on your own.

Our study, which drew on data from more than 500,000 respondents to the Gallup Daily Poll, examined the day-to-day fluctuations and patterns in people’s emotions, week after week. Two facts about emotional well-being emerged — one that was intuitive, the other surprising.

The intuitive finding was that people’s feelings of well-being closely tracked the workweek. As measured by things such as anxiety, stress, laughter and enjoyment, our well-being is lowest Monday through Thursday. The workweek is a slog. Well-being edges up on Friday, and really peaks on Saturday and Sunday. We are, in a real sense, living for the weekend.

The surprising finding was that this is also true of unemployed people. We found that the jobless showed almost exactly the same day-to-day pattern in emotional well-being as working people did. Their positive emotions soared on the weekend, and dropped back down again on Monday.

It seems obvious why working people cherish the weekend: It’s a respite from work. But why is the weekend also so important to the unemployed?

The key to answering this question is to recognize that not all time is equal. Time is, in many ways, what sociologists call a “network good.”

Network goods are things that derive their value from being widely shared. Take your computer: Its value depends in large measure on how many other people also have a computer. This is because you use your computer as, among other things, a communication technology: for Internet access, email, Facebook and file sharing. When everyone you know has a computer, the technology is indispensable. But if you were the only person with a computer, its value would be limited.

Free time is also a network good. The weekend derives much of its importance from the fact that so many people are off work together.

To help demonstrate this, my colleague and I conducted a second study, this time using the American Time Use Survey, which tracks how much time people spend doing various activities. We found that the weekly cycle in well-being from our previous study was mirrored in the pattern of time that people spent with family and friends — which was roughly double on weekends what it was during the week. According to our calculations, this increase of social time on the weekend accounted for roughly half the spike in weekend well-being.

Again, this was the same for the jobless. Monday to Friday offers five days when the unemployed are off work by themselves, searching job ads, doing household chores and so on. While the jobless have “free time” during the week, their friends and family still have to go to work. The weekend is when the jobless fall back into sync with society.

The weekend, then, is not just a respite from work, but also gives similar relief from unemployment. It is a time when people can get what they’ve been missing: time together.

This conclusion points to a key feature of the work-life problem: You cannot get more “weekend” simply by taking an extra day off work yourself. If we were to take more time off as individuals, we would be likely to spend that time, as the jobless do, waiting for other people to finish work. We are stuck “at work,” in a sense, by the work schedules of our family and friends.

Over the past few years, many workplaces have looked for ways to create more flexibility in individual work schedules. There is no question that doing so has many benefits. But my research suggests that a disadvantage of these efforts is that they may lead us even further from a weekend-like system of coordinated social time. They threaten, ultimately, to exacerbate the decline in civic engagement and social contact known as the “bowling alone” problem.

The solution might be found in a form of constraint: more standardization of the time for work and the time for life.

               ( Cristobal Young is an assistant professor of sociology at Stanford University)

PHOTOS OF THE DAY

A flock of migrating starlings flies over the southern Israeli village of Tidhar Thursday. Tsafrir Abayov/AP

Tate employees pose for photographers with artist Phyllida Barlow’s ‘untitled: upturnedhouse’ sculpture at the Tate Modern in central London Thursday. Stefan Wermuth/Reuters

Market Closes for January 14^th, 2016

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Dani Burger

     (Bloomberg) — Carnage in Canadian stocks abated, at least for now, as the nation’s benchmark index reversed morning losses to post its best day of the year after crude prices held above $31 a barrel.

     The Standard & Poor’s/TSX Index advanced 1.4 percent to 12,336.03 at 4 p.m. in Toronto, trimming its loss in 2016 to 5.2 percent. The index joined a rally in U.S. stocks after oil’s rebound from 12-year lows fueled speculation that equities declines had gone too far too fast this year. 

     Energy companies rallied 3.8 percent to lead advances on Thursday, while Valeant Pharmaceuticals International Inc. reversed early losses to post a 5.4 percent gain and lead health-care shares higher. Oil companies Kelt Exploration Ltd. and Paramount Resources Ltd. gained as much as 13 percent.

     Brent rebounded after an attack on OPEC member Indonesia. The global benchmark for crude had slid on Wednesday below $30 a barrel for the first time since April 2004 amid speculation that sanctions on Iran may be lifted by next money. Oil and gas producers were the worst performers last year, plummeting 26 percent.

     Material stocks were the only to decline in the S&P/TSX today as the Bloomberg Commodities Index was little changed after dropping to the lowest since 1991 on Tuesday. Gold companies, which rallied earlier this year as investors sought a haven, took a hit as risk-on sentiment returned to the market. Yamana Gold Inc. and Alamos Gold Inc. both dropped 10 percent.

     Canada’s resource-rich index was the second of seven countries to see its benchmark enter a bear market, capping a 20 percent slide on Jan. 7.

     Air Canada tumbled 9.2 percent to its lowest level since October 2014. Raymond James downgraded the airline, citing a poor expansion strategy and it’s capital expenditure commitments.

US

By Joseph Ciolli

     (Bloomberg) — Energy and health-care shares led a rebound in U.S. stocks, as the Standard & Poor’s 500 Index followed the steepest selloff since September with its strongest gain in a month, and the Dow Jones Industrial Average rallied more than 220 points.

     Exxon Mobil Corp. and Chevron Corp. jumped at least 4.5 percent as energy companies in the S&P 500 soared to their largest single-day gain since August. Health-care companies had their strongest advance in more than four months to recover from their biggest slide since Sept. 29. The Nasdaq Composite Index had its best rally in a month, reversing direction today after approaching a 14-month low. Intel Corp. fell in after-hours trading following its quarterly results.

     The S&P 500 rose 1.7 percent to 1,921.84 at 4 p.m. in New York, trimming in the final hour of trading a gain of as much as 2.3 percent. The Dow gained 227.64 points, or 1.4 percent, to 16,379.05. The Nasdaq Composite erased a 1.2 percent slide to close 2 percent higher. The Russell 2000 Index increased 1.5 percent after dropping into a bear market Wednesday. About 10 billion shares traded hands on U.S. exchanges, 37 percent above the three-month average.

     “This is the relief rally we’ve been waiting for,” said Bruce Bittles, chief investment strategist at Milwaukee-based Robert W. Baird, which oversees $110 billion. “Pessimism had grown to such a level that enough cash had been raised on the sidelines to sport at least a short-term rally. Better-than- expected earnings could be something for the bulls to grasp and provide this rebound some sustainability.”

     The recovery accelerated earlier while Federal Reserve Bank of St. Louis President James Bullard answered questions from reporters following a speech in which the policy maker, who was a vocal proponent of raising interest rates, sounded a more cautious tone. He said the latest decline in oil prices may delay the return of inflation to the central bank’s 2 percent target.

     The S&P 500’s plunge yesterday triggered a technical signal that indicates it’s oversold. The gauge’s relative strength index, which measures whether gains or losses have been too fast to sustain, fell below 30, a threshold indicating a rebound may materialize. The last time the RSI was that low was on Aug. 25, when the S&P 500 hit a bottom and rallied 6.5 percent over the next three days.

     U.S. stocks tumbled at the start of the year amid weakness in China’s equity and currency markets which fanned concerns a slowdown in the world’s second-largest economy will spread. Investors are turning their attention to corporate earnings for a gauge on the stamina of U.S. growth.

     Intel fell 3.7 percent as of 4:41 p.m. after the chipmaker predicted first-quarter sales that will fall short of some estimates, held back by the continued slump in demand for personal computers. Fourth-quarter profit exceeded analysts’ estimates, while sales were nearly in line. Citigroup Inc. and BlackRock Inc. are due to report results tomorrow. Analysts estimate profits for S&P 500 members fell 6.7 percent last quarter.

     “We’ll have to digest all these earnings numbers and then we’ll have a clearer picture, but if you look around the world, there’s not many positive drivers,” said Benno Galliker, a trader at Luzerner Kantonalbank AG. “Play it safe, that’s the message at the moment.”

     The recent equity selloff is an “emotional response,”  obscuring expansion in both the American economy and corporate profits, Abby Joseph Cohen, president of Goldman Sachs Group Inc.’s Global Markets Institute, said today. The fair value for Standard & Poor’s 500 Index is 2,100, she said.

     The main U.S. equity index has declined 9.8 percent from its record set in May, and is 2.9 percent above the bottom of an August swoon, which was also triggered by anxiety over the impact of China’s weakness on worldwide growth. The gauge has slumped since the Federal Reserve raised interest rates last month for the first time since 2006.

     Before St. Louis Fed President Bullard’s comments today, Boston Fed President Eric Rosengren yesterday said estimates for U.S. economic growth are falling, putting the central bank’s projected path for rate increases at risk, while the Chicago Fed’s Charles Evans said he’s nervous that inflation expectations are lower than policy makers think.

     The Fed official may have a case. A report today showed the cost of imported goods excluding fuels declined 3.4 percent last year, the biggest annual decrease since records began in 2001. Separate data showed applications for unemployment benefits unexpectedly increased last week, a sign labor market momentum may be starting to cool.

     The Chicago Board Options Exchange Volatility Index slipped 5 percent to 23.95. The measure of market turbulence known as the VIX is up about 32 percent this month, on track for the most since a record jump in August.

     All 10 of the S&P 500’s main industries gained today, with energy, health-care and technology companies increasing at least 2 percent. Energy shares rose 4.5 percent, the most since Aug. 27, for the second gain in the last seven days as crude oil rallied more than 2 percent.

     Emblematic of today’s turnaround, pipeline operator Williams Cos. lead all gainers with a 34 percent rally, its largest in 13 years. It was the S&P 500’s biggest loser yesterday, with its biggest loss since 2002. Exxon Mobil posted its strongest gain since August, and Transocean Ltd. added 7.6 percent.

     The Nasdaq Biotechnology Index rallied 4 percent after slipping 18 percent over the previous 10 sessions. Vertex Pharmaceuticals Inc. and Alexion Pharmaceuticals Inc. climbed more than 5.7 percent. Amgen Inc. surged 5.3 percent to help drive health-care shares’ biggest gain in four months, a day after the steepest drop since Oct. 6.

     Consumer discretionary stocks rose, after their biggest drop in four months, with Twenty-First Century Fox Inc. and CBS Corp. increasing more than 3.7 percent. Chipotle Mexican Grill Inc. extended its two-day rally to more than 12 percent after assuring investors that it can rebound from its food-safety crisis. Amazon.com Inc. climbed 1.9 percent, after losing 5.8 percent yesterday.

     Best Buy Co. and GoPro Inc. tumbled. The electronics retailer fell as much as 12 percent and closed with the biggest retreat in a year after reporting its third drop in holiday sales in four years, hurt by sluggish demand for mobile phones and a broader slump in the industry.

     GoPro plummeted 15 percent to its lowest since going public in June 2014, after news of disappointing holiday sales and job cuts renewed concerns the action-camera company is too focused on a single suite of products.

Have a wonderful evening everyone.

Be magnificent!

I see these things with an intense joy,

and while I observe, there is no observer, only a beauty almost like love.

For an instant, I am absent, myself and my problems, my anxieties, my troubles: nothing but this wonder exists.

Krishnamurti

As ever,

Carolann

It is not the man who has too little, but the man who craves more, that is poor.

                                                          -Lucius Annaeus Seneca, 4 BC-65 AD

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7