Newsletter - Kamran Afshar Associates Inc.

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BROWSE POSTS

Are we leaving this $34 trillion and rising national debt to our children to pay?

4/8/2024, 2:54:38 PM

The national debt is now at $34 trillion and appears to continue to rise for the foreseeable future. This puts the national debt at 121% of the GDP, which is huge but below its record high of 133% in the 2nd quarter of 2020. And while 2020’s Covid emergency made it an exception, national debt did not exceed 121% of the GDP even during WWII. Carrying debt creates several issues, the most pressing one being interest payment.

Retail Sales picked up just before tariffs

5/19/2025, 3:18:09 PM

Ahead of upcoming tariffs, retail sales jumped 5.2% year-over-year in March—double 2024’s 2.6% growth rate. This surge likely reflects consumers accelerating purchases, especially of durable goods, to avoid expected price hikes once the tariffs are fully implemented.

Moderate Job Gains Recorded in May

6/9/2025, 5:25:01 PM

Payroll employment increased by 139,000 in May, according to the Bureau of Labor Statistics. However, downward revisions to March and April figures cut 95,000 jobs from previous estimates, significantly reducing the overall impact. The unemployment rate inched up to 4.2%, continuing its steady rise from 4% in January. Most of May’s job gains came from healthcare and leisure-hospitality, while federal government, manufacturing, and retail trade saw declines.

How does the Federal Reserve influence the economy?

12/2/2024, 10:01:45 AM

The Federal Reserve system was established in 1913 as an independent federal agency with 12 regional banks and a board of governors to operate as the central bank of the United States. Its decisions significantly impact the banking systems, businesses, and the public.The Board is run by 7 members nominated by the Presidents and confirmed by the Senate to serve a one-time 14-year term; they can’t be fired or reappointed. This makes the board somewhat independent from current politics.

Inflation

3/18/2025, 10:06:58 AM

According to the Bureau of Labor Statistics, the seasonally adjusted consumer price index (CPI) rose by 0.2% in February; inflation over the last 12 months was 2.8%, close to the upper level of average inflation in this century, which was between 2.2 and 2.9%.

2024, Year in Review

1/29/2025, 3:03:33 PM

The economy grew at an annual rate of 2.6% during the first three quarters of 2024. Based on current data, last year’s economic growth is expected to be around 2.7%, which is better than the average for this century. The average unemployment rate for 2024 was 4%, well below this century’s average. The Valley’s average unemployment rate during the first 11 months of last year was 3.7%, yet another lowest for the century. Technically speaking, the economy is in a good place.

Consumer Sentiment Falls for the 4th month in a row

4/21/2025, 10:24:16 AM

The Consumer Sentiment Index, the CSI, dropped 11% in April, marking the fourth straight month of decline. In 2025, overall confidence has plummeted by 31%. Expectations for the economy's future have dropped by 36% this year. According to the University of Michigan, concerns are rising across the board: Republicans, Democrats, and independents alike are increasingly worried about their finances, job security, inflation, and the broader business climate. Expected inflation over the next 12 months has increased to 6.7%, a significant change from 2.8% last December. It should be noted that the drop in optimism is across the political spectrum, with the independents’ assessment of the economy now more resembling the Democrats than before.

U.S. Economy Contracts in the First Quarter

5/8/2025, 9:34:55 AM

According to the Bureau of Economic Analysis (BEA) advanced estimate, the U.S. economy contracted by 0.3% in the first quarter of the year, marking the first decline in Gross Domestic Product (GDP) since the beginning of 2022. The economy grew by 2.0% in the last 4 quarters, down from 2.5% in 2024. While this early estimate provides an initial snapshot, it underscores growing economic pressures—many of which are expected to intensify in the coming months due to the delayed effects of new tariffs.

The Housing Market: Trends and Outlook

4/3/2025, 2:46:44 PM

In the wake of the pandemic, the housing market surged to unprecedented levels, with annual home sales exceeding 6 million units nationwide and 11,000 locally. The last comparable boom occurred in 2005-2006, just before the Great Recession. This time, just like before, sales volume followed its spike with a crash to around 4 million nationally and 6,000 locally. And housing prices, like last time, continue to rise despite the sharp drop in sales volume. The similarities end there, unlike 2008, when the market collapse led to a deep recession, the economy remained strong through the end of 2024. Demand for housing, measured by total sales volume and price, peaked in the Valley in September 2021 despite the significant slowdown in the sales volume due to rapid rise in prices. Sales volume continued to drop through 2023, prices however, continued their rise albeit at a more moderate pace than before.

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