While the chocolate might melt in the high 90s temperatures in Phoenix, this weekend the Easter bunny will be visiting the Zeches household. Francis is overly excited as not only does he get some sweet treats but will most likely get a new Hot Wheels Monster Truck. Seeing the excitement for each holiday through the eyes of a child certainly makes everything else seem much less important.

Speaking of Easter eggs, have you ever noticed hidden references, clues, or jokes within some of your favorite movies? These are called easter eggs and are ways for the creators of these movies to connect with fans or other creators. For example, did you know Alfred Hitchcock appeared in thirty nine of the fifty-two films he made? In ‘The Birds’, he was the character leaving the pet store with two small dogs which were actually his real dogs. These brief cameos were some of the first easter eggs in films.

Can you spot some of the easter eggs in the following films:

  • Toy Story
  • The Departed
  • The Godfather
  • Disney’s Hercules
  • Back to the Future

Easter eggs are not just sweet treats and hidden parts of movies. There are easter eggs in the economy, however, they are more commonly known as indicators. While I have written in the past about indicators, as we continue to return to normalcy, the indicators are continuing to show good information.

Last week, unemployment claims decreased to a pandemic low of 684,000. This is good and shows the economy is continuing to recover and reopen. Even with this positive trajectory, there is still a long way to go to return to full employment. Additionally, it has been an uneven jobs recovery depending upon various factors including sex, race, and industry. No matter, a continued decrease in unemployment claims is a positive.

The ISM Manufacturing PMI measures the change in production levels across the economy from month to month. The most recent number for March was 64.7 an increase from 60.8 in February. This figure is at its highest level since December 1983. Any number greater than 50 is showing an expansion in manufacturing and potentially the economy. Our economy is and will continue to reopen. As it reopens there will be increased demand from consumers which ultimately leads to more production. Most recently, the blockage caused in the Suez Canal was reported, however there are dozens of ships waiting off the coast of Southern California. These ships are waiting to be offloaded with all manner of goods. Goods that the American consumer will ultimately purchase.

Finally, consumer confidence rose to its highest levels since the start of the pandemic. As reported by the Conference Board on Tuesday, the consumer confidence index increased to 109.7 in March from 90.4 in February. This was the third consecutive month over month increase as people become more optimistic. From vaccines and stimulus, to returning to work and businesses reopening, the consumer has much to look forward to.

As you can see, our economy is giving us ‘easter eggs’ showing the recovery and reopening is real. While there are risks in the economy and markets, such as tax increases and a potential virus surge, there is still positive momentum for continued growth throughout the year. As investors, we need to remember there are always risks to investing. While it is not possible to completely eliminate risk, it is important to stay true to one’s investment objectives, plans, and risk profile.

Have a wonderful weekend and I look forward to talking with you soon.

Chris Zeches, CFP®
Managing Partner