Post on 21-Jun-2020
Client Management Team
Rick Phillips President & Chief Investment Officer 702-575-6666 rick.phillips@ftnmainstreet.com
Tonya Dazzio Chief Operating & Compliance Officer 702-575-6592 tonya.dazzio@ftnmainstreet.com
Greg Balls, CFA Senior Portfolio Manager 702-575-6655 greg.balls@ftnmainstreet.com
Dan Rusk Portfolio Manager 702-575-6633 daniel.rusk@ftnmainstreet.com
Christine Wilson Operations Analyst 702-575-6640 christine.wilson@ftnmainstreet.com
Ruth Phillips Financial Analyst 702-575-6600 ruth.phillips@ftnmainstreet.com
Ada County
September 2019
10655 Park Run Drive Suite 120 | Las Vegas, NV 89144 | Toll Free 888.278.7350 | www.FTNMainStreet.com
Quarterly Investment Report
Portfolio Summary
State of Idaho LGIPUS Bank Money Marker
Market Value Federal Home Loan BankBook Value* Federal Home Loan Mtg CorpVariance Federal Farm Credit Bank
U.S. TreasuryPar Value SunWest Bank MMKT Checking
Zions BankNet Asset Value Federal National Mtg Assn
State Of Idaho DBF TRPurchase Yield Ada & Canyon School Districts
Ada CountyYears to Maturity Univesity of Idaho
Modified Duration
*Book Value is at Original Cost, Not Amortized
#Sector Allocation Key: Agy=Federal Agencies, CD=Cert of Deposit, DBF= State Diversifed Bond Fund, LGIP=State Pool, Mkt Act=Bank Mkt Acct, MMF=Money Mkt Acct, Muni=Municipals, Tsy=Treasuries
$119,183 $116,590
$189,603,496 $181,168,092
$100.063 $100.064
9/30/19 6/30/19
$189,826,027 $181,261,246 $189,706,844 $181,144,656
3.1% 2.8% 2.6% 2.3% 2.3% 0.5% 0.1% 0.0%
56.1% 9.6% 7.7% 6.9% 6.1%
ACCOUNT SUMMARY PORTFOLIO PURCHASE YIELD HISTORY TOP ISSUERS
Issuer % Portfolio
9/30/2019
SECTOR ALLOCATION# MATURITY DISTRIBUTION CREDIT QUALITY (MOODY'S)
Ada County
2.20% 2.35%
0.44 0.55
0.41 0.52
Agy22.9%
Muni0.7%
Tsy3.1%
LGIP56.1%
DBF2.3%
Zions2.6%
Mkt Acct12.3% 81.3%
11.4%6.1%
0.0% 1.1% 0.1%0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
0-1Y 1-2Y 2-3Y 3-4Y 4-5Y 5+Y
56.1%
2.3%
2.6%
2.8%
0.0%
0.1%
0.0%
0.0%
0.0%
0.0%
36.0%
0.0%
0% 20% 40% 60% 80%
NR-LGIP
NR-DBF
NR-Zions
NR-Bank
NR-CD
NR-Ada Co
NR
Aa3
Aa2
Aa1
Aaa
P-1
2.05%
2.10%
2.15%
2.20%
2.25%
2.30%
2.35%
2.40%
Oct
-18
No
v-1
8
De
c-1
8
Jan
-19
Feb
-19
Mar
-19
Ap
r-1
9
May
-19
Jun
-19
Jul-
19
Au
g-1
9
Sep
-19
NR: Not RatedPer Book ValuePer Book Value
Per Book Value
2
Investment Policy Compliance
0.44 Yrs
2.6%
0.7%
2.3%
22.9%
56.1%
9.6%
0.0%
2.8%
0.0%
FTN Financial Main Street Advisors relies on the accuracy of the data provided by Ada County to compile this report.
Yes:50% limit, maximum maturity 5 years. Domiced in the United State, must fall withing FDIC limit. Deposit Accounts in State/Federal
Credit Unions
Collateralized Business Market
Banking Accounts/Time Deposits-
State Depositories
Yes:No limit, maximum maturity 5 years.
Yes:
U.S. Federal Agencies
Idaho Diversified Bond Fund (DBF)
Idaho Local Govt Investment Pool
30% limit,15% issuer limit, maximum maturity 90 days, allowable collateral at 102% of investment,
transacted with Federal Reserve Primary Dealers with rating of A-1, P-1, or F1
Idaho Public Corporations
Repurchase Agreements
Municipal Securities
20% limit, 5% issuer limit, rated A or better by 2 of 3 rating agencies (S&P, Moody's, or Fitch).
Money Market Funds
Yes:
Yes:No limit, maximum maturity 5 years.
Maturity Limits
Parameters In Compliance
Yes
Investment Ratings At time of purchase, all investments must have an A (S&P), A2 (Moody's), or A (Fitch) rating or better. Yes
Maturities of investments must not exceed 5 years, unless unanimous consent of the Board of County
Commissioners is given.
Weighted Average Maturity Weighted Average Maturity (WAM) must be less than 3 years.
U.S. Treasuries
Ada County
50% Limit, 50% issuer limit for State of Idaho Bonds. 20% limit, 10% issuer limit for Idaho Counties,
Cities, Districts, and Education bonds.
70% limit, rated AAA (S&P), Aaa (Moody's), or AAA (Fitch).
No limit, issuer limit 50%, maximum maturity 5 years.
9/30/2019
Yes:
Yes:
Yes:
Yes:
Yes:
70% limit.
Yes:
30% limit.
Item / Sector
3.1%
3
Historical Book Values
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Avg
FY 13 $167.8 $162.8 $156.6 $198.3 $191.6 $183.9 $182.8 $171.1 $164.4 $196.7 $186.9 $177.0 $178.3
FY 14 $173.6 $162.2 $160.6 $161.5 $191.5 $191.0 $180.0 $175.3 $176.7 $226.2 $192.9 $183.5 $181.2
FY 15 $169.2 $168.1 $156.7 $230.5 $200.3 $193.3 $184.5 $181.9 $176.8 $234.0 $164.9 $153.3 $184.5
FY 16 $140.7 $137.5 $129.7 $258.6 $179.7 $171.4 $158.5 $154.7 $149.0 $221.6 $174.8 $165.7 $170.2
FY 17 $152.2 $148.7 $139.0 $286.6 $191.5 $183.5 $172.8 $169.5 $161.6 $249.1 $186.8 $177.3 $184.9
FY 18 $165.8 $162.0 $152.4 $336.6 $211.6 $201.8 $198.7 $191.7 $181.2 $296.4 $212.8 $200.9 $209.3
FY 19 $185.5 $179.5 $159.3 $287.0 $213.9 $202.1 $190.5 $184.6 $184.5 $295.9 $209.5 $199.4 $207.6Figures in Millions, Average Daily Balance
9/30/2019 Ada County
$100
$125
$150
$175
$200
$225
$250
$275
$300
$325
$350
Oct
-12
De
c-1
2
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
De
c-1
3
Feb
-14
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct
-14
De
c-1
4
Feb
-15
Ap
r-1
5
Jun
-15
Au
g-1
5
Oct
-15
De
c-1
5
Feb
-16
Ap
r-1
6
Jun
-16
Au
g-1
6
Oct
-16
De
c-1
6
Feb
-17
Ap
r-1
7
Jun
-17
Au
g-1
7
Oct
-17
De
c-1
7
Feb
-18
Ap
r-1
8
Jun
-18
Au
g-1
8
Oct
-18
De
c-1
8
Feb
-19
Ap
r-1
9
Jun
-19
Au
g-1
9
Mill
ion
s
4
Historical Book Values by Fiscal Year
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Avg
FY 13 $167.8 $162.8 $156.6 $198.3 $191.6 $183.9 $182.8 $171.1 $164.4 $196.7 $186.9 $177.0 $178.3
FY 14 $173.6 $162.2 $160.6 $161.5 $191.5 $191.0 $180.0 $175.3 $176.7 $226.2 $192.9 $183.5 $181.2
FY 15 $169.2 $168.1 $156.7 $230.5 $200.3 $193.3 $184.5 $181.9 $176.8 $234.0 $164.9 $153.3 $184.5
FY 16 $140.7 $137.5 $129.7 $258.6 $179.7 $171.4 $158.5 $154.7 $149.0 $221.6 $174.8 $165.7 $170.2
FY 17 $152.2 $148.7 $139.0 $286.6 $191.5 $183.5 $172.8 $169.5 $161.6 $249.1 $186.8 $177.3 $184.9
FY 18 $165.8 $162.0 $152.4 $336.6 $211.6 $201.8 $198.7 $191.7 $181.2 $296.4 $212.8 $200.9 $209.3
FY 19 $185.5 $179.5 $159.3 $287.0 $213.9 $202.1 $190.5 $184.6 $184.5 $295.9 $209.5 $199.4 $207.6Figures in Millions, Average Daily Balance
9/30/2019 Ada County
$120
$170
$220
$270
$320
$370
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Mill
ion
s
FY 19
FY 18
FY 17
FY 16
FY 15
FY 14
FY 13
5
Purchase YTM Per 6-Month Maturity Intervals
*Based on Book value
4.5 to 5.0+ 5.25% 0.13%
3.5 to 4.0 0.00% 0.00%
4.0 to 4.5 1.95% 1.07%
2.5 to 3.0 1.81% 1.35%
3.0 to 3.5 0.00% 0.00%
1.5 to 2.0 2.13% 6.28%
2.0 to 2.5 1.92% 4.74%
.5 to 1.0 2.20% 7.98%
1.0 to 1.5 1.94% 5.11%
0 to .5 2.25% 73.34%
9/30/2019 Ada County
Years Purchase Yield % of Portfolio*
2.25% 2.20%1.94% 2.13% 1.92%
1.81%1.95%
5.25%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
-0.5 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5
Pu
rch
ase
Yie
ld
Maturity Intervals
Bubble Size = Maturity's % of Portfolio
6
Weighted Average Maturity and Book Yield9/30/2019 Ada County
0.0
0.5
1.0
1.5
2.0
2.5
3.0O
ct-1
2
De
c-1
2
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
De
c-1
3
Feb
-14
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct
-14
De
c-1
4
Feb
-15
Ap
r-1
5
Jun
-15
Au
g-1
5
Oct
-15
De
c-1
5
Feb
-16
Ap
r-1
6
Jun
-16
Au
g-1
6
Oct
-16
De
c-1
6
Feb
-17
Ap
r-1
7
Jun
-17
Au
g-1
7
Oct
-17
De
c-1
7
Feb
-18
Ap
r-1
8
Jun
-18
Au
g-1
8
Oct
-18
De
c-1
8
Feb
-19
Ap
r-1
9
Jun
-19
Au
g-1
9
Year
s
Weighted Average Maturity History
0.0
0.5
1.0
1.5
2.0
2.5
Oct
-12
De
c-1
2
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
De
c-1
3
Feb
-14
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct
-14
De
c-1
4
Feb
-15
Ap
r-1
5
Jun
-15
Au
g-1
5
Oct
-15
De
c-1
5
Feb
-16
Ap
r-1
6
Jun
-16
Au
g-1
6
Oct
-16
De
c-1
6
Feb
-17
Ap
r-1
7
Jun
-17
Au
g-1
7
Oct
-17
De
c-1
7
Feb
-18
Ap
r-1
8
Jun
-18
Au
g-1
8
Oct
-18
De
c-1
8
Feb
-19
Ap
r-1
9
Jun
-19
Au
g-1
9
Per
cen
t
Month-End Book Yield vs 0-3Yr Treasury Index (24 month moving avg)*
Portfolio
Index
7
Book Yield per WAM per Percent of Portfolio9/30/2019 Ada County
Agy
LGIP
DBF
Zions*
Muni
Tsy
MMKT
1.8%
1.9%
2.0%
2.1%
2.2%
2.3%
2.4%
2.5%
-1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0
Yie
ld t
o M
atu
rity
Weighted Average Maturity (Years)
Bubble Size = Percent of Portfolio
*Seperately managed account at Zions Wealth Advisors. WAM is greater than 1 day.
8
Interest Rate Shock Analysis
$171,764,256
Portfolio Value Value Change Percent Change
$690,024$503,718$345,012
-$741,776
0.00%
-0.22%
-0.43%
$172,313,170 -$192,862 -0.11%
-$385,723$172,120,309
9/30/2019 Ada County
$173,196,056$173,009,750$172,851,044
0.40%0.29%0.20%
+100 Basis Points
Interst Rate Change
-100 Basis Points-75 Basis Points-50 Basis Points
No Change
-25 Basis Points
+75 Basis Points
+25 Basis Points
+50 Basis Points$171,949,700 -$556,332 -0.32%
$172,678,538 $172,506 0.10%
$0$172,506,032
0.40%
0.29%
0.20%
0.10%
0.00%
-0.11%
-0.22%
-0.32%
-0.43%-0.50%
-0.40%
-0.30%
-0.20%
-0.10%
0.00%
0.10%
0.20%
0.30%
0.40%
0.50%
-100BP -75BP -50BP -25BP No Change +25BP +50BP +75BP +100BP
Per
cen
t C
han
ge in
Po
rtfo
lio V
alu
e
Interest Rate Changes/Scenarios
Instantaneous Interest Rate Changes and Estimated Changes in Portfolio's Market Value
9
Next Twelve Months Maturities
Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20
$121.0 $0.0 $0.0 $0.0 $0.0 $0.0 $11.5 $0.0 $2.0 $0.5 $1.1 $0.0
Par Value in Millions. The DBF investment is included in the closest month.
9/30/2019
Maturities
Ada County
$121.0
$0.0 $0.0 $0.0 $0.0 $0.0
$11.5
$0.0 $2.0 $0.5 $1.1 $0.0
$0
$20
$40
$60
$80
$100
$120
$140
Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20
Mill
ion
s
10
Historical Sector Allocation
Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19
Agency 36.8% 36.3% 43.4% 30.1% 30.6% 31.1% 33.0% 31.2% 32.2% 27.3% 23.4% 22.9%
Treasury 3.4% 3.4% 4.1% 2.8% 2.9% 3.1% 3.3% 3.3% 3.3% 2.8% 2.9% 3.1%
State of Idaho DBF 2.4% 2.5% 3.0% 2.1% 2.1% 2.2% 2.4% 2.4% 2.4% 2.1% 2.1% 2.3%
State of Idaho LGIP 50.8% 51.1% 41.3% 59.4% 58.7% 57.5% 54.8% 56.6% 55.6% 62.2% 59.0% 56.1%
Municipals 0.7% 0.7% 0.9% 0.6% 0.6% 0.7% 0.7% 0.7% 0.7% 0.6% 0.6% 0.7%
Zions Account 2.8% 2.9% 3.5% 2.4% 2.4% 2.6% 2.8% 2.8% 2.8% 2.4% 2.5% 2.6%
Business Mkt Acct 3.1% 3.2% 3.8% 2.6% 2.7% 2.8% 3.0% 3.0% 3.0% 2.6% 2.6% 2.8%
Money Market 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 7.0% 9.6%
Total 100.0% 100.1% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Sector
9/30/2019 Ada County
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
60%
65%
70%
Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19
AGY
DBF
LGIP
Zions
Bs Mkt Acct
MMF
Muni
TSY
11
Issuer Allocation9/30/2019 Ada County
0.0%
0.1%
0.5%
2.3%
2.3%
2.6%
2.8%
3.1%
6.1%
6.9%
7.7%
9.6%
56.1%
0% 10% 20% 30% 40% 50% 60%
UNIVERSITY OF IDAHO
Ada County
ADA & CANYON SCHOOL D #2 GEN O
State Of Idaho DBF TR
Federal National Mtg Assn
ZIONS BANK
SUNWEST BANK MMKT CHECKING
U.S. Treasury
Federal Farm Credit Bank
Federal Home Loan Mtg Corp
Federal Home Loan Bank
US BANK MONEY MARKET
STATE OF IDAHO LGIP TR
12
Historical Earnings and Book Rate of Return Performance
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep$173.7 $334.8 $498.5 $662.6 $832.7 $1,009.8 $1,187.5 $1,357.5 $1,531.6 $1,688.2 $1,853.4 $2,005.5$178.2 $360.4 $496.4 $659.7 $812.5 $979.6 $1,133.8 $1,322.4 $1,540.0 $1,685.4 $1,839.0 $1,997.5$178.6 $349.5 $451.2 $539.4 $633.2 $806.4 $963.4 $1,134.5 $1,228.6 $358.4 $282.8 $270.4$75.9 $146.6 $220.6 $342.3 $375.0 $443.7 $585.9 $691.0 $790.5 $907.3 $1,018.2 $1,104.1
$105.0 $202.6 $296.7 $489.1 $623.2 $760.6 $905.5 $1,043.1 $1,172.7 $1,404.4 $1,565.0 $1,749.5$191.8 $373.9 $539.4 $933.0 $1,184.6 $1,460.3 $1,742.6 $2,031.9 $2,340.3 $2,859.5 $3,224.5 $3,571.1$341.4 $655.2 $940.0 $1,508.8 $1,894.6 $2,297.1 $2,669.9 $3,029.7 $3,414.1 $4,016.5 $4,447.7 $4,792.7
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep2.17% 2.15% 2.13% 2.21% 2.23% 2.25% 2.27% 2.27% 2.30% 2.31% 2.32% 2.31%
Custom Benchmark* 2.21% 2.25% 2.29% 2.31% 2.34% 2.36% 2.37% 2.37% 2.38% 2.37% 2.36% 2.35%-0.04% -0.10% -0.16% -0.10% -0.11% -0.11% -0.10% -0.10% -0.08% -0.06% -0.04% -0.04%
*Benchmark: 12 Month Moving Avg of the 0-3 Year Treasury ICE BofAML Index (G1QA)--Average Builds Over the Fiscal Year Period
Ada County
Variance
Book Rate of Rtn
Fiscal YTD ($000)FY 2013
9/30/2019
Fiscal YTD
FY 2014FY 2015FY 2016FY 2017FY 2018FY 2019
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Tho
usa
nd
s
Fiscal Year-to-Date Earnings
FY 2013
FY 2014
FY 2015
FY 2016
FY 2017
FY 2018
FY 2019
2.0%
2.1%
2.2%
2.3%
2.4%
2.5%
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Book Rate of Return vs Benchmark
Portfolio
Benchmark
13
Historical Book Rate of Return Performance
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
1.15% 1.09% 0.15% 0.65% 0.95% 1.71% 2.31%
0.23% 0.26% 0.37% 0.58% 0.85% 1.61% 2.35%
0.92% 0.83% -0.22% 0.07% 0.10% 0.10% -0.04%
*Benchmark: 12 Month Moving Avg of the 0-3 Year Treasury ICE BofAML Index (G1QA)--Average Builds Over the Fiscal Year Period
Benchmark*
Variance
9/30/2019 Ada County
Fiscal YTD
Portfolio
0.92%0.83%
-0.22%
0.07% 0.10% 0.10%
-0.04%
-0.5%
0.0%
0.5%
1.0%
1.5%
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
Portfolio vs. Benchmark: Annual Variance
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
Portfolio vs Benchmark Portfolio
Benchmark
14
Investment Activity
Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-1939 39 38 38 38 38 37 37 39 37 41 36
Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-190 0 0 0 0 0 0 0 4 0 5 01 1 0 0 0 1 0 2 2 1 5 21 1 0 0 0 1 0 2 6 1 10 2
Ada County9/30/2019
Purchases
Total Transactions
Positions
Redemptions
0
10
20
30
40
50
60
Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19
Po
siti
on
s
Number of Positions at Month End
0
1
2
3
4
5
6
Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19
Nu
mb
er o
f Tr
ansa
ctio
ns
Purchases and Redemptions* (Excluding LGIP, MMF, & Bank Accounts)Purchases
Redemptions
*Redemptions include maturities, calls, and sells
15
Quarterly Economic and Market Update
September 2019
16
Economic and Market Update
*Estimates for the current quarter/month, some data are lagged Sources: FTN Main Street and Bloomberg
9/30/19
Item 9/30/19 6/30/19 Change
U.S. Payrolls Monthly Change 136,000 178,000 (42,000)
Unemployment Rate 3.5% 3.7% (0.2%)
Labor Force Participation 63.2% 62.9% 0.3%
Effective Fed Funds Rate 1.90% 2.40% (0.50%)
2 Year T-Note 1.62% 1.76% (0.13%)
3 Month T-Bill 1.82% 2.09% (0.28%)
3 Year T-Note 1.56% 1.71% (0.15%)
5 Year T-Note 1.55% 1.77% (0.22%)
10 Year T-Note 1.67% 2.01% (0.34%)
U.S. Fed Debt Avg Yield* 2.52% 2.51% 0.01%
30 Year Mortgage Rate 3.72% 3.80% (0.08%)
1-5 Yr Agency Spread 0.05% 0.07% (0.02%)
1-5 Yr A-AAA Corporate Spread 0.44% 0.51% (0.07%)
Dow Jones 26,917 26,600 1.2%
S&P 500 2,977 2,942 1.2%
Consumer Price Index YOY* 2.1% 1.6% 0.5%
U.S. Avg Regular Unleaded $2.66 $2.72 ($0.06)
Retail Sales YOY* 4.2% 3.3% 0.9%
Case-Shiller Home Prices YOY* 2.0% 2.4% (0.4%)
Consumer Confidence 125.1 124.3 0.8
Gold (per ounce) $1,472.49 $1,409.55 $62.94
Dollar Index 99.38 96.13 3.25
17
Economic and Market Update
* Real Rate (Inflation Adjusted)
Source: Bureau of Economic Analysis
Estimate: Bloomberg's Survey of Economists
As of: 9/30/19
9/30/19
2.0
-1.0
2.9
-0.1
4.7
3.2
1.7
0.5
0.5
3.6
0.5
3.2
3.2
-1.1
5.5
5.0
2.3
3.2
3.0
1.3
0.1
2.0
1.9 2
.2
2.0 2
.3
2.2
3.2 3
.5
2.5
3.5
2.9
1.1
3.1
2.0
1.9
1.7
1.7 1.8
-2
-1
0
1
2
3
4
5
6
Q4
20
10
Q1
20
11
Q2
20
11
Q3
20
11
Q4
20
11
Q1
20
12
Q2
20
12
Q3
20
12
Q4
20
12
Q1
20
13
Q2
20
13
Q3
20
13
Q4
20
13
Q1
20
14
Q2
20
14
Q3
20
14
Q4
20
14
Q1
20
15
Q2
20
15
Q3
20
15
Q4
20
15
Q1
20
16
Q2
20
16
Q3
20
16
Q4
20
16
Q1
20
17
Q2
20
17
Q3
20
17
Q4
20
17
Q1
20
18
Q2
20
18
Q3
20
18
Q4
20
18
Q1
20
19
Q2
20
19
Q3
20
19
Q4
20
19
Q1
20
20
Q2
20
20
Pe
rce
nt
U.S. GDP (Quarter over Quarter Annualized)*
Estimates
18
Economic and Market Update
* Real Rate (Inflation Adjusted)
Source: Bureau of Economic Analysis
9/30/19
Estimate: Bloomberg's Survey of Economists
As of: 9/30/19
8.7
8.0
4.1
4.7
-0.6
7.1
2.1
2.1
-0.7
6.9
2.6
2.6
6.1
4.4
5.8
6.5 6.6
2.7
4.9
3.1
0.2
3.3
5.3 5
.6-0
.5 -0.2
5.4
4.6
5.5
3.2
-0.3
2.5
-1.8
4.6
7.2
4.2
3.5
3.5
4.2
3.7
1.9
-0.1
3.5
2.8
4.0
2.7
3.8
4.4 4.5 4
.84
.11
.01
.72
.93
.83
.52
.91
.9-0
.1-2
.52
.61
.62
.21
.82
.5 2.9
1.6
2.4
2.9
2.3
-5
-4
-3
-2
-1
0
1
2
3
4
5
6
7
8
9
19
50
19
52
19
54
19
56
19
58
19
60
19
62
19
64
19
66
19
68
19
70
19
72
19
74
19
76
19
78
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
20
18
Pe
rce
nt
U.S. Annual GDP *
1980s 3.2% 1990s 3.2% 2000s 1.9% 2010s 2.3%1960s 4.5% 1970s 3.3%1950s 4.2%
19
Economic and Market Update
Source: Bureau of Labor Statistics
12 Month Average Job Change 178,917
9/30/19
0
50
100
150
200
250
300
350
400
Mar
-15
Jun
-15
Sep
-15
De
c-1
5
Mar
-16
Jun
-16
Sep
-16
De
c-1
6
Mar
-17
Jun
-17
Sep
-17
De
c-1
7
Mar
-18
Jun
-18
Sep
-18
De
c-1
8
Mar
-19
Jun
-19
Sep
-19
Tho
usa
nd
s
U.S. Monthly Non-Farm Payrolls Change
2
3
4
5
6
7
8
Mar
-15
Jun
-15
Sep
-15
De
c-1
5
Mar
-16
Jun
-16
Sep
-16
De
c-1
6
Mar
-17
Jun
-17
Sep
-17
De
c-1
7
Mar
-18
Jun
-18
Sep
-18
De
c-1
8
Mar
-19
Jun
-19
Sep
-19
Pe
rce
nt
Unemployment RatesNevada
U.S.A
California
Idaho
Washington
Hawaii
20
Economic and Market Update
Source: Bureau of Labor Statistics
9/30/19
128129130131132133134135136137138139140141142143144145146147148149150151152153
Sep
-09
Ap
r-1
0
No
v-1
0
Jun
-11
Jan
-12
Au
g-1
2
Mar
-13
Oct
-13
May
-14
De
c-1
4
Jul-
15
Feb
-16
Sep
-16
Ap
r-1
7
No
v-1
7
Jun
-18
Jan
-19
Au
g-1
9
Mill
ion
s
U.S. Number of EmployedFull-Time and Part-TIme
62.0
62.5
63.0
63.5
64.0
64.5
65.0
65.5
Sep
-09
Ap
r-1
0
No
v-1
0
Jun
-11
Jan
-12
Au
g-1
2
Mar
-13
Oct
-13
May
-14
De
c-1
4
Jul-
15
Feb
-16
Sep
-16
Ap
r-1
7
No
v-1
7
Jun
-18
Jan
-19
Au
g-1
9
Pe
rce
nt
U.S. Labor Force Participation Rate
21
Economic and Market Update
Source: Department of Labor and Bloomberg
9/30/19
Weekly Initial Jobless Claims is the actual number of people who have filed for Unemployment benefits for the first time. The following five eligibility criteria must be met in order to file for
unemployment benefits: 1. Meet the requirements of time worked during a 1 year period (full time or not). 2. Become unemployed through no fault of your own (cannot be fired). 3. Must
be able to work; no physical or mental holdbacks. 4. Must be available for work. 5. Must be actively seeking work.
200
250
300
350
400
450
500
550
600
650
700
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Tho
usa
nd
s
Weekly Initial Jobless Claims (4 Week Moving Average)
22
Economic and Market Update
*Real: Inflation Adjusted
Source: U.S. Census Bureau Source: Conference Board
9/30/19
-0.6-0.4-0.2
00.20.40.60.8
11.21.41.61.8
22.22.42.62.8
33.23.43.63.8
44.2
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Jun
-19
Pe
rce
nt
U.S. Real* Retail Sales YOY % Change
20
40
60
80
100
120
140
Mar
-09
Sep
-09
Mar
-10
Sep
-10
Mar
-11
Sep
-11
Mar
-12
Sep
-12
Mar
-13
Sep
-13
Mar
-14
Sep
-14
Mar
-15
Sep
-15
Mar
-16
Sep
-16
Mar
-17
Sep
-17
Mar
-18
Sep
-18
Mar
-19
Sep
-19
Ind
ex
Val
ue
U.S. Consumer Confidence
23
Economic and Market Update
CPIX: Consumer Price Index, excluding food and energy PCEC: Personal Consumption Expenditure Core
Source: Bureau of Labor Statistics and Bureau of Economic Analysis
9/30/19
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Jun
-19
Pe
rce
nt
CPI and CPIX YOY % Change
CPI CPIX
0.0
0.5
1.0
1.5
2.0
2.5
3.0
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Jun
-19
Pe
rce
nt
PCE and PCEC YOY % ChangePCE PCEC
24
Economic and Market Update
Sources: New (U.S. Census Bureau),Existing (National Assoc. of Realtors)
Source: Case-Shiller Seasonally Adjusted Annual Rate
9/30/19
-6
-4
-2
0
2
4
6
8
10
12
14
Ap
r-1
1
Sep
-11
Feb
-12
Jul-
12
Dec
-12
May
-13
Oct
-13
Mar
-14
Au
g-1
4
Jan
-15
Jun
-15
No
v-1
5
Ap
r-1
6
Sep
-16
Feb
-17
Jul-
17
Dec
-17
May
-18
Oct
-18
Mar
-19
YO
Y P
erc
en
t
Case-Shiller 20 City U.S. Home Price IndexYOY % Increase
200
300
400
500
600
700
800
3.0
3.5
4.0
4.5
5.0
5.5
6.0
Mar
-11
Sep
-11
Mar
-12
Sep
-12
Mar
-13
Sep
-13
Mar
-14
Sep
-14
Mar
-15
Sep
-15
Mar
-16
Sep
-16
Mar
-17
Sep
-17
Mar
-18
Sep
-18
Mar
-19
Ne
w-T
ho
usa
nd
s
Exis
tin
g-M
illio
ns
U.S. New and Existing Home Sales
Existing-Left
New-Right
25
Economic and Market Update
Source: U.S. Treasury
9/30/19
$9
$10
$11
$12
$13
$14
$15
$16
$17
$18
$19
$20
$21
$22
$23
$24
Sep
-09
Mar
-10
Sep
-10
Mar
-11
Sep
-11
Mar
-12
Sep
-12
Mar
-13
Sep
-13
Mar
-14
Sep
-14
Mar
-15
Sep
-15
Mar
-16
Sep
-16
Mar
-17
Sep
-17
Mar
-18
Sep
-18
Mar
-19
Trill
ion
s
U.S. Federal Debt Outstanding
1.9
2.0
2.1
2.2
2.3
2.4
2.5
2.6
2.7
Sep
-09
Mar
-10
Sep
-10
Mar
-11
Sep
-11
Mar
-12
Sep
-12
Mar
-13
Sep
-13
Mar
-14
Sep
-14
Mar
-15
Sep
-15
Mar
-16
Sep
-16
Mar
-17
Sep
-17
Mar
-18
Sep
-18
Mar
-19
Pe
rce
nt
U.S. Treasury Interest Bearing Debt Avg Rate
26
Economic and Market Update
Fed Funds Anticipated Rate from the September 18, 2019 FOMC Meeting
Source: Bloomberg
9/30/19
0.80
1.00
1.20
1.40
1.60
1.80
2.00
2.20
Oct
-20
19
No
v-2
01
9
Dec
-20
19
Jan
-20
20
Feb
-20
20
Mar
-20
20
Ap
r-2
02
0
May
-20
20
Jun
-20
20
Jul-
20
20
Au
g-2
02
0
Sep
-20
20
Oct
-20
20
No
v-2
02
0
Dec
-20
20
Jan
-20
21
Feb
-20
21
Mar
-20
21
Ap
r-2
02
1
May
-20
21
Jun
-20
21
Jul-
20
21
Au
g-2
02
1
Sep
-20
21
Oct
-20
21
No
v-2
02
1
Dec
-20
21
Jan
-20
22
Feb
-20
22
Mar
-20
22
Ap
r-2
02
2
May
-20
22
Jun
-20
22
Jul-
20
22
Au
g-2
02
2
Sep
-20
22
Pe
rce
nt
Fed Funds vs. Fed's Anticipated Fed Funds Rate (Fed Dots)
Fed's Anticipated Rates
Fed Funds Futures
27
Economic and Market Update
Source: Bloomberg
Figures may not total due to rounding
3M
Maturity
-0.131.621.762Y
-0.171.761.931Y
-0.281.822.106M
-0.281.822.09
2.01 1.67 -0.34
Change9/30/196/28/19
9/30/19
3Y 1.71 1.56 -0.15
30Y 2.53 2.11 -0.42
5Y 1.77 1.55 -0.22
10Y
1.3
1.5
1.7
1.9
2.1
2.3
2.5
2.7
3M 6M 1Y 2Y 3Yr 5Y 10Y 30Y
Pe
rce
nt
U.S. Treasury Yield Curve Change
9/30/19
6/28/19
-45
-40
-35
-30
-25
-20
-15
-10
-5
0
3M
6M 1Y
2Y
3Yr 5Y
10
Y
30
Y
Bas
is P
oin
ts
Basis Point Change
28
Economic and Market Update
Source: Bloomberg
9/30/19
-0.25
0.00
0.25
0.50
0.75
1.00
1.25
1.50
1.75
2.00
2.25
2.50
2.75
Sep
-14
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Jun
-19
Sep
-19
Pe
rce
nt
U.S. Treasury Yields: 3M and 1Y
1Y
3M
0.00
0.25
0.50
0.75
1.00
1.25
1.50
1.75
2.00
2.25
2.50
2.75
3.00
3.25
Sep
-14
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Jun
-19
Sep
-19
Pe
rce
nt
U.S. Treasury Yields: 2Y and 5Y
5Y
2Y
29
Economic and Market Update
Source: Bloomberg
9/30/19
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Jan
-54
Jan
-56
Jan
-58
Jan
-60
Jan
-62
Jan
-64
Jan
-66
Jan
-68
Jan
-70
Jan
-72
Jan
-74
Jan
-76
Jan
-78
Jan
-80
Jan
-82
Jan
-84
Jan
-86
Jan
-88
Jan
-90
Jan
-92
Jan
-94
Jan
-96
Jan
-98
Jan
-00
Jan
-02
Jan
-04
Jan
-06
Jan
-08
Jan
-10
Jan
-12
Jan
-14
Jan
-16
Jan
-18
Jan
-20
Pe
rce
nt
U.S. Treasury Yields 2Yr and 5Yr - Fed Funds Target Rate
5Yr
2Yr
Fed Funds
30
Economic and Market Update
Source: Bloomberg
9/30/19
Global Treasury Rates
2 Year Yields 5 Year Yields 10 Year Yields
-0.91%
-0.77%
-0.70%
-0.61%
-0.52%
-0.32%
-0.27%
0.36%
0.77%
1.58%
1.62%
-4.0% -2.0% 0.0% 2.0% 4.0%
Switzlnd
Germany
France
Portugal
Spain
Japan
Italy
England
Australia
Canada
USA
-0.91%
-0.78%
-0.64%
-0.36%
-0.30%
-0.29%
0.21%
0.28%
0.75%
1.40%
1.54%
-4.0% -2.0% 0.0% 2.0% 4.0%
Switzlnd
Germany
France
Japan
Spain
Portugal
Italy
England
Australia
Canada
USA
-0.79%
-0.57%
-0.28%
-0.22%
0.14%
0.16%
0.48%
0.82%
1.02%
1.36%
1.66%
-2.0% 0.0% 2.0%
Switzlnd
Germany
France
Japan
Spain
Portugal
England
Italy
Australia
Canada
USA
31
Economic and Market Update
ICE BofAML Index (option adjusted spread vs. Treasury) ICE BofAML Index (option adjusted spread vs. Treasury)
1-5Yr Non-Callable Agency (GVPB) Corporate A-AAA Excluding Yankee (CVAC)
Source: ICE BofAML Indices
9/30/19
Current Spread is 5 Current Spread is 44
0
50
100
150
200
250
300
350
400
450
500
550
600
650
Au
g-0
5
Au
g-0
6
Au
g-0
7
Au
g-0
8
Au
g-0
9
Au
g-1
0
Au
g-1
1
Au
g-1
2
Au
g-1
3
Au
g-1
4
Au
g-1
5
Au
g-1
6
Au
g-1
7
Au
g-1
8
Au
g-1
9
Bas
is P
oin
ts
Spread: 1-5Yr Agency vs Treasury
0
50
100
150
200
250
300
350
400
450
500
550
600
650
Au
g-0
5
Au
g-0
6
Au
g-0
7
Au
g-0
8
Au
g-0
9
Au
g-1
0
Au
g-1
1
Au
g-1
2
Au
g-1
3
Au
g-1
4
Au
g-1
5
Au
g-1
6
Au
g-1
7
Au
g-1
8
Au
g-1
9
Bas
is P
oin
ts
Spread: 1-5Yr A-AAA Corporate vs Treasury
32
Economic and Market Update
*ICE BofAML Index (option adjusted spread vs. Treasury) *ICE BofAML Index (option adjusted spread vs. Treasury)
AAA Rated ABS (R0A1) CMO Agency 0-3Yr PAC (CM1P)
Source: ICE BofAML Indices
9/30/19
Current Spread is 40 Current Spread is 17
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
800
Au
g-0
5
Au
g-0
6
Au
g-0
7
Au
g-0
8
Au
g-0
9
Au
g-1
0
Au
g-1
1
Au
g-1
2
Au
g-1
3
Au
g-1
4
Au
g-1
5
Au
g-1
6
Au
g-1
7
Au
g-1
8
Au
g-1
9
Bas
is P
oin
ts
Spread: AAA Asset Backed vs Treasury
-150
-100
-50
0
50
100
150
200
250
300
Au
g-0
5
Au
g-0
6
Au
g-0
7
Au
g-0
8
Au
g-0
9
Au
g-1
0
Au
g-1
1
Au
g-1
2
Au
g-1
3
Au
g-1
4
Au
g-1
5
Au
g-1
6
Au
g-1
7
Au
g-1
8
Au
g-1
9
Bas
is P
oin
ts
Spread: 0-3Yr Agency CMO vs Treasury
33
Economic and Market Update
Source: Bloomberg
9/30/19
-5.8-5.0
-4.1
-2.0
-0.8-0.3 -0.2 -0.1
0.5 0.61.2 1.2 1.3 1.5 1.8 1.8
2.32.8
4.4 4.4
7.68.3
(8)
(6)
(4)
(2)
0
2
4
6
8
10
Per
cen
t
Selected Sector Quarterly Total Returns
34
Economic and Market Update
Source: Bloomberg
9/30/19
-26.9
-16.1
-9.4 -8.2-5.4
-2.5-1.0
1.02.4 2.5
4.1 4.1 4.36.4 6.8 7.1
8.410.3
13.8
19.9
23.425.2
(30)
(20)
(10)
0
10
20
30
Per
cen
t
Selected Sector Year-Over-Year Total Returns
35
Economic and Market Update
Sources: Bloomberg, FTN Main Street
9/30/19
1.20
1.30
1.40
1.50
1.60
1.70
1.80
1.90
2.00
6/3
0/1
9
7/3
/19
7/6
/19
7/9
/19
7/1
2/1
9
7/1
5/1
9
7/1
8/1
9
7/2
1/1
9
7/2
4/1
9
7/2
7/1
9
7/3
0/1
9
8/2
/19
8/5
/19
8/8
/19
8/1
1/1
9
8/1
4/1
9
8/1
7/1
9
8/2
0/1
9
8/2
3/1
9
8/2
6/1
9
8/2
9/1
9
9/1
/19
9/4
/19
9/7
/19
9/1
0/1
9
9/1
3/1
9
9/1
6/1
9
9/1
9/1
9
9/2
2/1
9
9/2
5/1
9
9/2
8/1
9
Per
cen
t
5 Year Treasury Note Yield
Tariff War Heats Up, as Trump Expands Tariffs on
Chinese Goods
Nonfarm Payrolls Beat Estimates
CPI Ticks Higher Than Expected
Solid ISM Non-Manufacturing and Private
Payroll Bounce
EU Purchasing Manager Data Surprises to the
Upside
ISM Manufacturing Enters Contraction
Territory
10Yr Treasury Inverts With 2Yr
Treasury
Economic Data in Europe Point to
Growth
Stronger Retail Sales Ebbs Concern of
Slowing Economy
Consumer Confidence Data Misses the Mark
36
Economic and Market Update
Sources: Bloomberg, FTN Main Street
9/30/19
25,200
25,700
26,200
26,700
27,200
27,700
6/3
0/1
9
7/3
/19
7/6
/19
7/9
/19
7/1
2/1
9
7/1
5/1
9
7/1
8/1
9
7/2
1/1
9
7/2
4/1
9
7/2
7/1
9
7/3
0/1
9
8/2
/19
8/5
/19
8/8
/19
8/1
1/1
9
8/1
4/1
9
8/1
7/1
9
8/2
0/1
9
8/2
3/1
9
8/2
6/1
9
8/2
9/1
9
9/1
/19
9/4
/19
9/7
/19
9/1
0/1
9
9/1
3/1
9
9/1
6/1
9
9/1
9/1
9
9/2
2/1
9
9/2
5/1
9
9/2
8/1
9
Dow Jones Industrial Index
US Announces Delay in Tariffs
Trump and Xi Agree Not to Impose More
Tariffs
Trump Accuses China of Currency
Manipulation
Fed Chairman Powell Signals Fed
Cut
Trump Announces Additional Tariffs
Inverted Yield Curve Stokes Recession Fears
New Tariffs Take Effect
Q2 Productivity Increases More Than Expected
Dow Drops on Trade and Impeachment
Concerns
Consumer Sentiment Unexpectedly Rises
37
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