October 23, 2023 Investor Insights
Military Spending Rises
October 23, 2023
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- The U.S. defense budget has grown by approximately 20% over the past five years. The recent conflict in Israel may lead to even larger increases. This has sent the stocks of the four largest defense contractors (tickers: LMT, NOC, GD, LHX) up an average of 12% since the Hamas attacks. 1
- US office vacancy rates reached a 20+ year high of 13.3% this year, with San Francisco and Chicago having the highest rates at 20.1% and 16.3%. Miami saw a decrease to 8.8%, the lowest since the second quarter of 2020. 2
- This year’s stock market recovery has not benefited as many stocks as past recoveries have. Only two-thirds of stocks in the S&P 500 rose in value over the past 12 months, compared to 88%-97% of stocks in the past four bull markets. *3
- About 80% of 65-year-olds will require some form of long-term care in their lifetime. The most recent Genworth Cost of Care Survey shows that the median cost of an in-home aide is around $5,100/month compared to $4,500/month for assisted living. The median cost of one year in a nursing home is around $100K. 4
Sources:
- Barrons - "Defense Stocks Rise After Biden Asks Congress for Aid to Israel, Ukraine"
- MFS - "Beyond the News"
- WSJ - "There’s a Reason This Bull Market Feels So Weird"
- Barrons - "Most Seniors Will Need Long-Term Care. Here’s How to Save for It."
*Past performance is not indicative of future performance
Disclosure: This information is furnished for the use of Glen Eagle Advisors, LLC, Glen Eagle Wealth, LLC, and their clients and/or contacts. It does not constitute the provision of investment advice to any person. It is not prepared with respect to the specific objectives, financial situation, or particular needs of any specific person. Investors reading this commentary should consult with their Glen Eagle representative/financial advisor regarding the appropriateness of investing in any securities or adapting any investment strategies discussed or recommended in this newsletter.
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