Getting Defensive Against a Recession
Affluence can make it easy to believe that you are immune to economic downturns. After all, it typically involves having substantial assets, investments, and resources at your disposal. History has shown us time and again, however, that even the wealthiest individuals can be impacted by financial crises. That is why it’s essential to prepare for a 2023 recession: You need a solid plan in place to protect your savings and assets. In the sections below, I discuss the unique challenges […]
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Date: May 8, 2023
***Q1 Client Update***
What a difference the turning of the calendar makes. Stocks and bonds both fell moderately in December to end the single worst year in diversified investing of the modern era. Coming into 2023, my thesis was that the bear market in stocks and bonds had ended in October 2022 and that 2023 was going to be the front-loaded year of the bull. It only took the bulls a few days to get their legs underneath before they exerted their pressure […]
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Date: May 8, 2023
Apple & Jobs to The Rescue
The stock market has now survived the Fed meeting, Apple’s earnings and the April jobs report. I think there is one other item, but I can’t recall. The stock market was lower into and after the Fed as Jay Powell remained hawkish, but to a lesser degree. After Thursday’s close, Apple beats expectations and the bump carried over to the pre-market this morning. While the economy created more jobs than expected in April which feeds fuel to the Fed’s fire, […]
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Date: May 5, 2023
The Fed is Clueless If They Raise Rates Again Today
Here we go. Another one of those “most important Fed meetings ever” nonsense from the media. “SPECIAL Coverage”. Oh boy. I couldn’t sleep with all that anticipation. Those of you who know me know my usual sarcasm. Before I continue, let me spell out the market model for today. Stocks trade between plus and minus 0.50% until 2pm and then a bigger move happens. That’s usually to the upside, but Chair Jay Powell’s tenure has changed that a bit. With […]
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Date: May 3, 2023
First Republic Goes Bye Bye
It was only a matter of time. I cannot believe everyone did not see it coming, but some held out hope. And remember, hope is not an investment strategy. FRC was taken over by the FDIC and sold to JP Morgan is a pre-packaged deal. And what a deal it was for JPM. Congrats to Jamie Dimon for yet another fire sale steal. And yet another stock that Jim Cramer liked as recently as March. The third bank failure in […]
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Date: May 1, 2023
Schizophrenic
The markets have been up and they have been down this week, looking a bit schizophrenic. I did not like what I saw on the way down on Tuesday and Wednesday and I wasn’t overjoyed about the huge rally on Thursday. And that is also represented in the amount of movement in our portfolios. Regardless of how this resolves, higher or lower, I do not want to get caught sleeping at the wheel. Between Google, Microsoft and Meta (the old […]
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Date: April 28, 2023
Quick & Ugly
On Monday I wrote that this “period of no volatility should end right about now.” Well, I didn’t think it would literally be that very moment nor to the degree that stocks fell on Tuesday. The decline on Tuesday was quick, ugly and relentless. Gold offered a little haven but bonds were really the only place to hide. If you are looking to assign blame I would look at the banks and more specifically to First Republic which has been […]
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Date: April 26, 2023
Recession Preparation for High-Net-Worth Individuals
The world’s economies, like our own, are never static. They’re always in motion, like tides in the various oceans. This is why, although storms such as inflation and stock market instability aren’t frequent, they’re not unheard of, either. Generally speaking, they blow in, and then, eventually, they depart. Historically, severe storms like recessions have been much rarer, but unfortunately, they can also last even longer. That is why it is crucial to keep your portfolio prepared for possible economic downturns […]
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Date: April 24, 2023
Huge 10 Days Coming for Earnings
This is a huge week for Q1 earnings with many high profile technology names like Google and Microsoft reporting. Apple is not until May 4th. When the big names report there are usually outsized moves in those stocks like we saw in Tesla last week. It matters because the mega cap stocks have very large weightings in the S&P 500 and NASDAQ 100. So while the vast majority of stocks could do one thing, a big move by Google and/or […]
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Date: April 24, 2023
Like Watching Paint Dry
The markets haven’t been all that exciting this week. Choose your analogy. Watching paint dry. Watching grass grow. I chose the former since I am in full grass planting mode and it better grow quickly next week after the sun, rain and warmth coming. Below is an index I don’t often show, but one that the masses follow religiously. It’s the VIX index which is one measure of volatility based on the options market. Typically, when stocks fall the VIX […]
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Date: April 21, 2023
Tax Day Trend & Two Sectors
Adios tax day 2023! It was good to se you go. Congrats to all of my CPA readers who braved another season and survived. I feel like there was more work done this year than in the recent past with more preliminary 1099s than ever before. Twitter was abuzz about paying taxes. 10% of taxpayers pay 80% of taxes which makes sense in a progressive tax system. Liz Warren claimed that Americans are paying so much in taxes simply because […]
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Date: April 19, 2023
Could a Roth Conversion Ease Your Tax Bite?
Minimizing the amount you pay in taxes is essential for weathering market downturns. However, the complexity of the U.S. tax code often makes it difficult to plan effective tax strategies on your own. This is why affluent taxpayers sometimes assume that their best option is simply to pay whatever they owe each year. Many of them have no idea how much money they could potentially save by planning financially to lower their tax liability. One strategy worth considering, for instance, […]
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Date: April 17, 2023
All That Good News to Begin Earnings Season
Now that JP Morgan has reported earnings, Q1 earnings season is officially here. Banks usually kick us off and we saw a slew of solid reports to end last week. So far, rumors of more banks’ demise are not panning out. And let’s not forget about the benign CPI and PPI reports last week, further confirming inflation’s demise. However, with oil rallying, that tailwind has dissipated. With all that good news, the stock market should have soared, right? Below is […]
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Date: April 17, 2023
Inflation Data Benign – Strong & Weak Indices
After a benign CPI report, the PPI report was even more tame, continuing to support my longstanding theme of inflation moderation. This has been an amazing story as we now have 9 straight months of lower month over month inflation. I can’t find a similar streak over the past 50 years and I saw on Twitter you have to go back to the 1930s to see, not exactly a valid comp. Of course and obviously, it is difficult to see […]
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Date: April 14, 2023
Bears Are Wrong – Yet Again
As I finish this post, the government just released the Consumer Price Index (CPI) and it came in a touch cooler than expected across the board. Inflation continues to moderate as has been my thesis for a year. While it is not getting back to the Fed’s arbitrary long-term target of 2%, it should still slowly meander to some new normal level below 4%. And yes, this takes more pressure off the Fed to raise rates higher for longer. I […]
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Date: April 12, 2023
A Powerful Indicator Just Lit Up – Not to Be Ignored
The major stock market indices continue to digest recent gains. We know that the Dow Industrials, S&P 500 and NASDAQ 100 have been leading while the S&P 400 and Russell 2000 have been lagging. I expected Friday’s employment report to lead to some Monday morning fireworks, but that doesn’t seem to be the case. Stocks look down a bit and bonds a little worse, but nothing too bad. The bulls should make some noise during the day. Those of you […]
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Date: April 10, 2023
April & Q2 Setting Up Nicely For The Bulls But Concerns Remain
Let’s focus on April and what it seasonally brings to the stock market. We know that it an historically strong month for stocks, especially in a pre-election year. We also know that when it begins the month in an uptrend, it averages more than 1% return. We also know that the super strong trends that began at last November’s election continue this month and through Q2. Regarding Q1 ending, when the stock market does not breach the lowest levels from […]
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Date: April 6, 2023
New Month & Quarter – Could Banks Be a Winner?
The new month and new quarter begin today and the typical tailwind may be somewhat muted because of how strong stocks were last week. Nonetheless, we still have positive seasonals this week. With the masses looking to avoid showing banks on their Q1 ending reports I wonder if we see some reversion to the mean for the super hated sector that was in the spotlight for much of Q1. I can’t say the chart above of the banks really creates […]
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Date: April 3, 2023
Never Die on the Hill of a Market Scenario
Although the media keeps saying how surprised they are about the strength this week, it was in the cards last week and I wrote about it in all posts. It’s really amazing how they try to spin a new narrative to back up the price again. Last week, it was about the teetering banking system and how easy it is to create a bank run. Who would be next? Or, would Yellen’s and the FDIC’s measures save the system from […]
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Date: March 31, 2023
“What if I Run Out of Money?”
Is a recession coming? Are you worried about running out of money after retirement? With the financial uncertainties caused by a likely 2023/2024 recession, global economic turmoil and increasing life expectancies, even some affluent families and individuals are growing apprehensive about their financial future. However, there is a way to ease those fears—by getting proactive. If you create a comprehensive financial plan for your post-retirement years, you can ensure that your retirement savings last throughout your life. We just need […]
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Date: March 31, 2023
