In this week’s recap: Markets overcome reaction to latest Delta variant news. THE WEEK ON WALL STREET Overcoming a COVID-related economic growth scare, stocks moved higher amid a week of strong corporate earnings reports. The Dow Jones Industrial Average rose 1.08%, while the Standard & Poor’s 500 gained 1.96%. The Nasdaq Composite index soared 2.84% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, dipped 0.20%.1,2,3 DELTA VARIANT HEAD … [Read more...]
Conducting Your Mid-Year Financial Checkup
The midpoint of the year is a great time to review your financial position. With June officially behind us, it’s time to face the facts: we’re headed toward the second half of 2021. While there’s still plenty of time to enjoy the rest of summer, we encourage you to slow down and check up on your financial well-being. Review your budget: Your spending habits likely look different now than they did in 2020, but did you adjust your yearly budget accordingly? The second half of the year can be … [Read more...]
The Fed Acknowledges Inflation
As inflation climbs, the Fed reacts. At its June meeting, the Federal Reserve confirmed what many of us have suspected for some time: prices are rising. In fact, prices are climbing faster than many expected. In response, the Fed raised its inflation expectation to 3.4%, up from its March projection of 2.4%, effectively raising its inflation expectation by 42%.1 The Fed’s course correction on inflation expectations and planned interest rate hikes unsettled the financial markets, with … [Read more...]
The Fed’s Taper Rehearsal
The talk is of tapering, and it’s making investors nervous. The Federal Open Market Committee (FOMC) released the minutes of its April meeting last week. The report suggested that should the economy continue to make progress, it may be time to adjust the pace of the Fed’s monthly bond purchase program.1 With inflation appearing to accelerate, this is the first sign that the Fed is considering such a scaling back. While such a change might be inevitable, it comes with no timetable and no … [Read more...]
Investor Sentiment Is Shifting
This year, markets have experienced an odd phenomenon. A recent survey shows that 63% of investors are more interested in protecting their financial assets and planning for uncertainty in the future than anything else.1 There are many reasons for this change, but here are a few of the most impactful to keep in mind. Pandemic worries. One reason for this shift is directly related to life prior to COVID-19. Nearly two-thirds of those surveyed believe protecting their financial assets and … [Read more...]
Building a Healthy Financial Foundation
How many pieces do you have in place? When you read about money matters, you will sometimes see the phrase, “getting your financial house in order.” What exactly does that mean? When your financial “house is in order,” it means it is built on a solid foundation. It means that you have six fundamental “pillars” in place that are either crucial for sustaining your financial well-being or creating wealth. #1: A savings account. This is your Fort Knox: the place where you store and build … [Read more...]
The Whims of Wall Street
What to know about shifting market attention, and investor burnout. It can be exhausting trying to keep up with the whims of Wall Street. Lately, the financial markets have been fixated on federal taxes and what may be proposed on Capitol Hill in the weeks and months ahead. Wall Street’s focus on taxes closely follows its attention on the 10-year Treasury yield. And it wasn’t that long ago that the financial markets were influenced by reopening and vaccine distribution … [Read more...]
Investing During Periods of Inflation
What does inflation mean for your investments? In August of 2020, the Fed announced that it is willing to allow inflation to run higher than normal in order to support the labor market and broader economy. This major policy shift allows inflation to run above the Fed’s 2% goal for some time before the Fed would consider increasing short-term interest rates in an attempt to combat higher prices.1 These robust changes to the Fed’s long-standing inflation policy further illustrates the … [Read more...]
Tax Efficiency in Retirement
What role should taxes play in your investment decisions? Will you pay higher taxes in retirement? Do you have a 401(k) or a traditional IRA? If so, you will receive income from both after age 72. However, if you have saved and invested much of your life, you may also end up retiring at a higher marginal tax rate than your current one. In fact, the income alone resulting from a Required Minimum Distribution could push you into a higher tax bracket. While retirees with lower incomes may … [Read more...]
Economic Predictions: What Lies Ahead?
Here’s what the financial forecast may have in store. It can be easy to overlook the nation’s solid economic fundamentals when the financial media splashes stories every day about an army of amateur traders, short-selling mania, and initial public offerings (IPOs) that double in price on the first day of trading. But a recent survey by The Wall Street Journal showed just how upbeat economists are about 2021.1 Here’s a quick summary of the highlights. Increased projected economic … [Read more...]