Market Digest \u2013 Week Ending 12\/2\/2016\r\n\r\nUS stocks declined for the week and, more specifically the S&P 500 fell about 1%. For the first time since the election, international stocks fared better, finishing flat for the week. Friday\u2019s jobs report was strong and unemployment fell to 4.6%, the lowest since August 2007. Corporate earnings are also coming in strong, posting a 5.2% increase from a year ago. Q3 GDP growth was revised upward to 3.2%. As a result, it is now almost assured the Fed will raise interest rates in December. OPEC surprised skeptics by reaching a deal to cut production, sending oil prices higher.\r\n\r\nWeekly Returns:\r\n\r\nS&P 500: 2,192 (-1.0%)\r\nFTSE All-World ex-US: (-0.0%)\r\nUS 10 Year Treasury Yield: 2.38% (+0.03%)\r\nGold: $1,177 (-0.5%)\r\nUSD\/EUR: $1.066 (+0.7%)\r\n\r\nMajor Events:\r\n\r\n\u2022 Tuesday \u2013 The US Q3 GDP growth estimate was revised up to 3.2%.\r\n\u2022 Tuesday \u2013 Case Shiller reported that home prices hit an all-time high in September, though they remain 16% below the 2006 peak on an inflation adjusted basis. Seattle, Portland and Denver reported the highest gains.\r\n\u2022 Wednesday \u2013 OPEC members reached an agreement to cut oil production by 1.2 million barrels a day by January.\r\n\u2022 Wednesday \u2013 Royal Bank of Scotland must add $2.5 billion in capital after failing a BOE stress test.\r\n\u2022 Friday \u2013 US employers added 178,000 jobs in November, reducing unemployment to 4.6%.\r\n\u2022 Friday \u2013 Pandora Media said it was open to engaging in talks to be acquired by SiriusXM. Shares rose 16%.\r\n\r\nOur take:\r\n\r\nDonald Trump rode a wave of voter discontent to win the presidency. Indeed, there are big chunks of the economy facing very long lasting wage stagnation and there are depressed regional areas, but the headline numbers on the economy are good. Official unemployment dropped to 4.6%, the lowest in almost a decade. Q3 GDP growth was over 3%, corporate earnings are growing again, and the stock market is near all-time highs.\r\n\r\nHow long can the good times last? Nobody knows. The Fed will raise rates, but small and incremental changes shouldn\u2019t have a big impact on economic activity. Ironically, the fate of the US economy is likely to be decided abroad. China is facing a massive debt crisis but recent numbers suggest the Chinese economy is stabilizing. Europe has their own banking problems and if a Euro-member decides to leave the EU or the common currency it would cause severe economic disruption. But for now, all is quiet.