Last week the US Labor Department announced that price increases year over year were 8.5% meeting expectations by analysts. This is the most rapid increase in inflation in 40 years. Forty years ago, some of you were not born yet or were so young that you wouldn’t remember the impacts of high inflation.
On a walk with my wife this past week I turned to her and said, “remember the earlier days of Covid?” Days and days in a row when we stayed home, didn’t see any friends in person, walked endlessly, and stayed away from crowds? An ironic sort of nostalgia set in for the earlier days of the pandemic with little on the agenda.
While the pandemic is waning, one in three Americans worry about contracting Covid especially in light of any and all new variants, down from 50% late in 2021. At the same time, inflation is causing rising costs and converging with the lower savings rates, meaning an uptick in a return to jobs. This trend began in September 2021 and continues to increase.
Last week the stock market had the biggest rally since the pandemic bear market beginning in March 2020. Only after large market moves is it “easy” to determine why such market moves actually happened. Hindsight analysts always look smart! Going forward, predictions are all over the map, but the consensus for GDP growth for 2022 is still 3.6%, indicating strong economic growth. 2023 is still in the range of 2.5% toward the higher end of growth over the last 10 years.
This week, the Federal Reserve raised the Fed Funds rate from 0-.25% to .25-.50%. This raise has been promised since the end of last year. It is not a surprise and is probably the first of a number of rate increases this year. The Fed has raised its expectation for inflation this year only to over 4% with lower expectations to 2.6% for 2023, above the Fed goal of 2%.
Action item: Download Form 1099s for all applicable accounts. For SAS managed accounts at TD Ameritrade Institutional: Log in with your username and password at www.advisorclient.com Choose tab "Documents" Then choose from the left "Tax Documents" Finally, download all listed 2021 Form 1099 documents Do the same for all other accounts outside of SAS/TD Sign up for e-delivery of tax documents by logging into www.advisorclient.com, then clicking My Profile > Communication Preferences. Perspective Out of...
Action item: Download Form 1099s for all applicable accounts. For SAS managed accounts at TD Ameritrade Institutional: Log in with your username and password at www.advisorclient.com Choose tab "Documents" Then choose from the left "Tax Documents" Finally, download all listed 2021 Form 1099 documents Do the same for all other accounts outside of SAS/TD Sign up for e-delivery of tax documents by logging into www.advisorclient.com, then clicking My Profile > Communication Preferences. A tsunami...
We are officially in correction territory as far as the SP 500 and Nasdaq 100 are concerned. The Fed has been promising an increase in the fed funds rate as well as a halt to the Fed's purchases of bonds. Quantitative easing is over for the time being.
According to a certain slice of Wall Street, each year we hear that this is the year of the stock picker. The latest is Goldman Sachs stating that this is the year that “alpha” returns. Alpha is a calculation that differentiates the value that an investment strategy brings to an investment strategy or stock picking ( https://www.investopedia.com/terms/a/alpha.asp). Every year, we hear this same analysis! Why and who proclaims this? Well, it is the Wall Street...
In our work, because our relationship with clients is more than about the data and outcome of financial planning scenarios, we talk about many issues. This has been our practice since the beginning and because I have an M.Ed. in counseling and experience as a therapist, psychology and mental health are always concerns of ours. We are financial planners with a strong interest in mental health and many of our conversations with clients and each other involve issues of mental health.
The big news today after the stock market closed was a major disappointment on Metaverse or Facebook earnings with an after-hours decline in the stock price of 20%. Spotify joined Meta in disappointing earnings and also dropped after hours. This is one day after Alphabet or Google reported blow-out earnings and moved the market higher in general today. Volatility continues on a daily basis as measured by the Volatility Index or VIX that uses options...
There have been two consistent messages from the Federal Reserve since the last quarter of 2021-rates are heading higher and the economy is growing.
