Economic releases portrayed continued slow growth in the global economy. Equity and bond markets were little changed in this shortened Thanksgiving-holiday week. Credit spreads declined, especially for the riskiest securities; this generated positive returns for the credit-sensitive bonds on the week. Oil prices rose, but commodity metals prices declined on the week. The U.S. dollar was mixed, gaining against the Yen and Looney, but losing ground to the European currencies.

Perspective:

This Thanksgiving, the retailers went all out to expand their Black Friday offerings well into the Thanksgiving Day. This encroachment on dinner, dog shows, parades and football may have been necessitated by the shorter time between Thanksgiving and Christmas, or retailers' desire to expand market share. ShopperTrak reported a 2.3% increase in sales for Thursday and Friday, the weakest results since 2009. Retailers are likely to pay the price of this promotion in narrower profit margins. These Black Friday results are in line with the slow growth the economy has been generating.

On a personal note, the Davidson family had a smaller than usual crowd sitting around our Thanksgiving table. We just had our kids and their significant others; we missed the extended family members who have joined us in the past. We spent the days hanging out and being with one another, not shopping. Even our super-shopper, #2 daughter, skipped the crowds for more family time this year.

Economic Releases:

The U.S. government shutdown delayed the release of Housing Starts and Permits data for September and October. This week, Housing Permits (blue in the chart) were released for both of those months. Starts (red in the chart) have yet to be released for either month. The Permits strength was largely due to the multifamily component. October Permits rose to a new post recovery high of 1.034 million, above the range of expectations and coupled with an upward revision to the September number. In other U.S. housing news, the Pending Home Sales Index came in at 102.1 in October, above the September release, but below the September upward revision; this represented the fifth down release in a row with lower Index values. On the positive side, the Case/Shiller Home Price Index of 20 cities rose 1.0% (seasonally adjusted) in September and 13.3% year-over-year. All 20 cities posted gains for the second month in a row.

Durable Goods Orders fell -2.0% in October. Even without the more volatile transportation component, Orders fell -0.1%. On a year-over-year basis, Durable Goods (blue in the chart) rose 5.3% and Durable Goods Orders less transportation (red in the chart) rose 4.3%.

Other Economic Releases

Weekly Initial Jobless Claims fell to 316,000 in the week of Nov. 23. This was below the range of expectations and dropped the four-week average to 331,750. Continuing Claims fill 91,000 to a new post-great-recession low of 2.776. Prior factors and calendar factors may have come into play, but the jobs picture has shown improvement. That improvement was not apparent in the November Conference Board Consumer Confidence release, which fell a point to 70.4. On the other hand, the University of Michigan Consumer Sentiment Survey rose three points to 75.1, driven by a bounce-back in expectations. The Conference Board's Leading Indicators rose +0.2% in October following an upward revision to the September data. On a city basis, the Dallas Survey of Business Activity was down, but its Production Index was up in November; the Chicago PMI rose to 63, signaling potential strong Purchasing Managers' Indices data next week.

In the European Union, economic and industrial sentiment rose in November, but consumer sentiment slipped. Unemployment in the EU fell a tick to 12.1%, attributed to improvements in the French rate; the German rate remained 6.9%. In October, German Retail Sales fell -0.8%. In the UK, third-quarter GDP was unrevised at +0.8%.

In China, the CFLP Manufacturing PMI remained unchanged at 51.4 in November. Japan's Markit Manufacturing PMI rose a point to 55.1. Industrial Production in Japan rose +0.5% in October.

Equities Markets:

In the shortened Thanksgiving week in the U.S., equity markets were little changed. With the exception of the Canadian and UK markets, equity markets were slightly higher on the week. A strong November provided solid single digit returns quarter-to-date for the equity markets across the globe.

Bond Markets:

Bond yields were also little changed in the U.S., but slightly lower in Canada, Europe and Asia. Credit markets benefited from both lower rates and narrower spreads.

Currencies & Commodities:

The U.S. dollar fell against the European currencies, but rose against the Yen and Looney on the week. Oil prices declined, but metal commodity prices rose on the week.

Who is John Davidson?

John W. Davidson, CFA, started writing these Comments more than a decade ago as a personal discipline when he was promoted to from portfolio manager to chief investment officer and CEO.

Most recently, he was the president of PartnerRe Asset Management Corporation, responsible for the management of PartnerRe's invested assets, which grew from $4 billion to $12 billion during his tenure. After joining PartnerRe in the fall of 2001, he hired the staff, built the trading floor and created the infrastructure to manage both fixed income and equity assets internally. He retired from PartnerRe at the end of 2008 and moved to Maine, where he focused on board work.

He has more than 35 years of industry experience, including positions with investment management responsibility for separate institutional accounts, mutual funds, trusts and insurance assets. Prior to joining PartnerRe, he served as president and chief executive officer of two other investment management companies. For various companies he has held positions as chief investment officer, chief economist, head of fixed income and portfolio manager. As a portfolio manager, Davidson managed and traded U.S. Government Securities as well as futures and options on fixed income instruments.

His real world experience is backed by a strong academic foundation, which includes earning a Master of Business Administration in finance and a Master of Arts in mathematics from Boston College, as well as a Bachelor of Arts, cum laude, in economics from Amherst College. He holds the professional designation of chartered financial analyst.

His experiences and credentials have brought him to the public as a television commentator and conference speaker. In addition to his frequent past appearances on CNBC, CNNfn, Bloomberg TV and Yahoo FinanceVision, he appeared as a special guest on Wall $treet Week with Louis Rukeyser. Reuters, Bloomberg and other business press services have quoted his views on the market. He has taught CFA preparation programs, as well as other courses offered by the Stamford and Boston CFA Societies, and the National Graduate Trust Officers' School.

Davidson is a natural leader in both his professional and personal life, having developed those skills early in his career as a naval officer. He spent three years on active duty, which included a year on the rivers of Vietnam, and 24 years in the Naval Reserve, from which he retired as a captain in 1994.

Davidson is treasurer and board member of the Camden Conference. He is also on the investment committee of the Pen Bay Health Foundation. He serves as an independent trustee for mutual funds.

In his leisure time, he is an active sailor, tennis player and skier. With his wife, Barbara, he renovated a 100+-year-old home in Camden, where they enjoy spending time with their two golden retrievers and having visits from their five children. He can be reached at jwdbond@me.com.