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Weekly eNews: September 18, 2017

Financial Market Update

Welcome to the StrategicPoint Financial Market Update — a market and economic overview of what occurred last week and what’s up for this week. Please find our market commentary and most recent Blog posts in our StrategicPoint of View®.

Last Week

Stocks followed the prior week’s plunge by surging to record highs last week. The Dow, S&P 500, and Nasdaq reached new all-time highs during the week, as each of the indexes listed here posted impressive gains. The small caps of the Russell 2000 led the way, gaining over 2.3%, followed by the Dow, S&P 500, Nasdaq, and the Global Dow. For the year, the Nasdaq still remains in the lead as it closes in on 20%.

The price of crude oil (WTI) closed at $49.83 per barrel, up from the prior week’s closing price of $47.56 per barrel. The price of gold (COMEX) fell to $1,323.50 by early Friday evening, $27.50 lower than the prior week’s price of $1,351.00. The national average retail regular gasoline price increased to $2.658 per gallon on September 11, 2017, $0.006 higher than the prior week’s price and $0.483 more than a year ago.

S&P 500: 2500 (up 1.58% for the week and up 11.68% for the year)
NASDAQ: 6448 (up 1.39% for the week and up 19.79% for the year)
Dow: 22268 (up 2.16% for the week and up 12.68% for the year)
US Treasury 10yr: 2.20% (from 2.05% last week)
Crude Oil (October): $49.89 (from $47.29 last week)
Gold (December): $1,325.20 (from $1,330.40 last week)
USD/Euro: $1.1947 (from $1.1896 last week)

 

StrategicPoint of View®

Equifax: Are Monitoring, Alerts and Freezes Enough?

Like most people, my credit cards have periodically been stolen, and subsequently replaced by my credit card companies. A vendor for my health insurance company was also hacked, entitling me to free Identity Theft Monitoring. I have felt lucky that any assault to my personal credit has been limited.

But the Equifax breach is different. It affects over half the adult population and involves more than just one piece of information. By potentially being able to combine name, address, date of birth and Social Security number, the thieves may have sufficient information to create mini credit clones of each of us affected by the breach. Worse, the information that defines us, such as date of birth and SSN, does not change, possibly allowing future thieves and the generation of thieves thereafter to utilize our data for their purposes. Clearly when institutions fail us, we become responsible for ourselves.

In this blog I will talk about some of the actions everyone should be taking regularly to help protect them from credit fraud and identity theft. And then I will provide what steps StrategicPoint recommends that you take as a result of the Equifax breach.

What you should do personally:

Checking statements:
You have heard this before: check your bank, credit card and insurance statements for information you do not recognize. The advice requires more than just a monthly brief scan of your statements when they come in the mail or you are notified on line. It means you have to make time to review each line item, question each activity you don’t recognize and research whether you responsible for them or not.

How often do we forget a purchase we made last month (or a purchase a joint card holder made)? Before calling the bank/credit card company, it is up to us to dig into our memory banks, check our calendars as to where we were on the day recorded, talk to our spouses, look up the source of the charge on line (if it doesn’t quite match the place of purchase) etc. etc. Most of the time we will actually have made the purchases we question.

However, if you suspect your information has been compromised, call the fraud departments of your bank, credit card or insurance companies. These numbers can be found on the website of the issuers of your accounts. Do not respond to e-mails or phone calls regarding any misappropriation of your information unless you can corroborate through a second call. My practice is: if I feel I am actually talking to my credit card company about a potential breach, I will thank the caller and then call the fraud number on the website to provide any information needed before issuing a new card.

Order annual credit reports
You are entitled to one free credit report a year from each of the top three credit reporting agencies (Equifax, TransUnion and Experian). The best approach is often to spread these reports across the year – one every four months. You can apply on line. If you forget your own history (I once forgot a P.O. Box address I briefly used years ago) the companies will give you a chance to fill in a mail application to be accompanied by documentation (such as a copy of your original social security card, drivers licenses, passport, etc.) that become part of your history. It is a bit unnerving, but I haven’t figured out a way around it.

In order to receive your free reports, you should apply on line at www.annualcreditreport.com.  (Other sites will likely charge you.) By acquiring a credit report every 4 months, you can set up your own credit monitoring as a backup to any monitoring the credit card companies provide.

For both checking statements and receiving credit reports, we would suggest keeping calendar reminders, since it is easy to forget or let too much time pass.

Changing credit card numbers
Equifax is purportedly going to notify people whose credit card information was exposed (this does not apply to everyone affected by the breach). If you receive notification from Equifax, call your credit card company, cancel your card and request a new one.

Equifax itself
Everyone should determine if their information was compromised by going to http://www.equifaxsecurity2017.com on a secure computer and an encrypted network connection. You will be inputting your last six digits of your SS number, and want to use a trusted computer to do this. There are two answers we have seen: your information has not been compromised (the least often response) and your information may have been compromised – which, for practical purposes, you should assume to be a yes.

Free credit monitoring
You should take advantage of the free monitoring offered by Equifax (even if your information may not be compromised) now that Equifax has changed the terms to allow participants to take part in any future class action suits against the company.

One word of caution: credit monitoring only supplies you with notification when a company has tried (or succeeded) in applying for credit under your name.  It doesn’t prevent the application for credit being approved; it merely shortens the time to discovery. You still have to clear up any damage.

Free fraud alerts
This is an additional step in credit monitoring, which requires those applying for credit in your name to contact you and get your permission before opening any new credit in your name. Everyone is eligible for free fraud (also called security) alerts for 90 days at a time (these can be renewed). Again – use your calendars as a reminder of when your alert expires.

Security freezes
Freezes go one step further and restrict access to your credit report, which is required by most companies before they will authorize any new accounts or lines of credit.  They are recommended to those individuals who are not in the immediate market to buy a new house, refinance, change employment or open any additional lines of credit. If you do need new or additional credit, you may want to wait until these transactions are complete before freezing your credit reports. Once you establish a freeze (and unfortunately you need to apply to each of the credit reporting companies individually for full coverage) each company will supply you with a PIN which you must use to unfreeze your reports in order to obtain new credit yourselves. Please note credit freezes are not free and costs will vary- be sure to ask each credit bureau what their fees will be prior to proceeding.

A word of caution: I am following Ron Lieber in the New York Times as he tracks Equifax’s response to its breach. As of September 14th the company was still having major problems with phone and on line access. Those who do get through to Equifax are receiving mixed quality of service, according to Lieber. In addition, there are problems with obtaining PIN numbers (a crucial must have) once they have signed up for the freeze. Moreover, if you signed up early after the breach announcement, you may need a new PIN, a process Equifax is still working on. In other words, patience is needed, but keep trying.

Yes, the steps outlined to protect your credit information and history will be a lot of work on your part. Unfortunately, that work will need to continue until consumers’ safety and trust become top priorities of the credit industry. Until that time, there is no better monitor of your own credit than yourself.

This Week

The Federal Open Market Committee meets this week following a break in August. Committee members will cull a mixed bag of economic information, with job growth steady but little inflationary pressure. The FOMC may opt to leave interest rates as they are for the time being, with a possible increase in October in anticipation of more noticeable economic growth during the fall months.

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*Past performance is not indicative of future results. Indices are unmanaged and you cannot directly invest in them. The Nasdaq Composite Index measures all NASDAQ U.S. and non-U.S. based common stocks listed on the Nasdaq Stock Market. The S&P 500 index is based on the average performance of 500 industrial stocks monitored by Standard and Poor’s. The data referred to above was taken from sources believed to be reliable. StrategicPoint Investment Advisors has not verified such data and no representation or warranty, expressed or implied, is made by StrategicPoint Investment Advisors.

Data sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indices listed are unmanaged and are not available for direct investment.

The information contained in this report is not intended as investment, tax or legal advice. StrategicPoint Investment Advisors assumes no responsibility for any action or inaction resulting from the contents herein.

Parts of this report were prepared by Broadridge Investor Communication Solutions, Inc.
Copyright 2017. Part of this content contributed by Forefield, Inc.