17 Scary Numbers From the Fourth Quarter

The fourth quarter of 2012 was dominated by several big news items such as the election and the fiscal cliff, and despite some bumpiness around the way stocks ended the quarter, little changed. In fact, stocks were solidly higher for the year. But as implied by the volatility in the market, there were still plenty of things to draw investor concerns. Every quarter, I take a look at some scary numbers that jumped out at me. Here are some notable ones for the most recent three-month period.

1.00: Price/fair value ratio for all stocks rated by Morningstar's analysts. Stocks as a whole are fully valued, meaning investors aren't getting a margin of safety to protect themselves if anything goes wrong. Not a reassuring thought. 

0.84: Price/fair value ratio cut-off for wide-moat stocks to make it into the Morningstar Wide Moat Focus Index. A year ago, that number was 0.77. Even among high-quality names, which had been trading a discount for some time, the number of big bargains is shrinking. 

2.1%: Dividend yield on the S&P 500, still well below historical levels. It's still a bad time to look for income. 

11: Days since the U.S. government hit the debt ceiling according to the Treasury Department. The Treasury is undertaking some extraordinary measures to create some extra room under the ceiling, but those measures could run dry as soon as February. 

0: Approximate chance that the debt-ceiling debate will get resolved without extreme partisan bickering. 

63.6%: Labor force participation rate in December, down from 64% in August 2011 and a rate of more than 66% before the financial crisis. This was scary last quarter and remains troubling now. Some of the decline is explained by an aging population, but the sudden decline in the workforce seems to point to some structural problems in the job market. 

4.8: Millions of people who have been unemployed for more than 27 weeks as of December, unchanged from November. Even as job growth continues at a steady pace, the economy still faces the major problem of getting the long-term unemployed back to work before their skills atrophy or they drop out of the workforce completely. 

23.5%: Unemployment rate for 16- to 19-year-olds. Youth unemployment is another headwind to future growth. As entry-level jobs get filled by older workers, younger people are locked out and aren't able to learn the skills that will help them (and the entire economy) down the road.

-11%: Drop in sales of  Microsoft (MSFT)-powered laptops during the holidays according to market research firm NPD Group. Many tech firms had hoped that the launch of Windows 8 would help reignite interest in PCs, but so far the response has been muted. 

-55%: Return of Zipcar's  shares from its IPO until today. Even with the $500 million buyout offer from Avis Budget Group (CAR), Zipcar shareholders didn't have a fun ride. It goes to show that the most interesting ideas don't always make the best investments. 

8.8: Billions of dollars in write-offs that  Hewlett-Packard (HPQ) took in November as a result of its acquisition of Autonomy in 2011. The failure of this deal is another reminder that empire-building, transformational deals rarely turn out well in the end.

-12.6%: Decline in  Nook segment sales during the 2012 holiday period. Despite some new products,  Barnes & Noble  continues to face an uphill battle against  Amazon.com (AMZN) and  Apple (AAPL) in the e-reader space.

$1.5: Size of fine (in billions)  UBS (UBS) handed over to regulators to  settle charges that the bank manipulated LIBOR, a key interest rate. This was the latest in a series of run-ins global banks had with regulators in 2012. 

5.6%: The International Monetary Fund's estimate for emerging-markets gross domestic product growth in 2013, slightly better than the 2012 level but still well below 2010 (7.4%) and 2011 (6.2%) levels. 

0.2%: Estimate for the eurozone's growth rate in 2013 according to an October report by the IMF. This is already down from July's estimate of 0.7%. This could very well move lower as European economies continue to struggle.  

5%: Yield on Spanish 10-year bonds. Spanish bonds are well off their euro-crisis highs following this summer's European Central Bank pledge to keep the eurozone together, but rates are still disconcertingly high as Spain's underlying competitiveness issues remain unresolved. 

$2.9: Size (in trillions) of the Fed's balance sheet, up from $869 billion in August 2007. This incredibly accommodative monetary policy has helped keep the economy growing. But reversing this trend and shrinking the balance sheet without cutting off the recovery or stoking inflation will be a hard balancing act.