Sep 262014
 

Why chase the S&P 500? The answer might surprise you. Many investors use the S&P 500 as a benchmark for their investments. Often, however, this can derail an investor from their life long financial dreams and goals.

Note: Originally posted on November 21, 2013 but still applicable for investors today.
Greg Powell, CIMA
President/CEO
Wealth Consultant

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Chasing the S&P 500

Sep 152014
 

Please let us know what you think about our new shortened and concise format. You can email me here or call me at (205) 989-3498.

Europe and Asia economic issues

While the US economy is strong, there are economic issues slowing down Europe and Asia. These regions will soon begin to initiate their own version of quantitative easing. This mean that in the next few weeks the United States could see international money flowing in from European and Asian countries. This will continue the current debate about whether the US market is fairly valued.

Last week, retail sales reports came out better than expected. Because the US is much more of a global economy than it has ever been, investors need to pay close attention to what is going on in Europe and Asia, as it will have an economic impact here at home.

Three economic issues this week

This week we are watching three important issues. The first is the data that is coming out of China. The second is the meeting that the Fed is having to discuss interest rate hikes.

Standard and Poor’s has a report showing that historically, six months after a rate hike, the market will go up, on average, about 2.6%. Twelve months later the market will be up, on average, about 6.2%. It could be possible that over the next few months the markets trade back, but we believe that doesn’t mean the market is overvalued.

The third issue is Scotland voting to succeed from Great Britain. Pay attention to this as Scotland will be watched by other countries and their actions could become a trend.

Tax issues affecting the economy

One of our top five market drivers we’ve been watching all year is the government. We believe debate over US policy tax code will start to come out of the White House this week and go into the Senate. This debate will be about another tax increase and making the code more complex.

The Tax Competitiveness Index (TCI) shows that the US is not very competitive compared to the rest of the world. Out of 34 large industrial countries around the world, the US is TCI ranked at 32nd. This is encouraging people to buy companies in other countries outside the US. We are behind on tax competitiveness to other countries of which many liberal thinkers consider to be socialist, like Finland and Denmark. With midterm elections coming up, this will be a difficult debate.

Is there something in the markets that concerns you that we haven’t covered? Send us your comments by emailing me here or call me at (205) 989-3498. I would be delighted to talk with you.

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Greg Powell, CIMA
President/CEO
Wealth Consultant

Franklin Bradford, CMT
Senior Vice President
Wealth Consultant

Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant

fi-Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. fi-Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The S&P 500 index is a measure of performance of the broad domestic economy through 500 stocks from major industries. The NASDAQ Composite represents all the stocks that trade on the Nasdaq. The Dow Jones Industrial Average measures the average price of a group of 30 high value stocks.
Economic Issues

Sep 082014
 

What do you think?

We would still like feedback on our new video blog format which we have changed to be shorter and more concise. We want to make sure we are still giving you the information you want. You can email me here with your thoughts and comments.

Remembering 9/11

9/11 display9/11 display
This week we remember all those who lost their lives or loved ones in the attack on 9/11. We will never forget that day and the impact it caused on our nation. In our office here at fi-Plan Partners we have a special section commemorating 9/11 that honors those who lost their lives on that tragic day.

New market high

This past Friday the S&P 500 hit it’s 33rd record market high. This came after the Jobs Report was released which showed the numbers did not achieve expectations. There are those forecasting that now we might not see a rate increase until the 2nd or 3rd quarter of next year.

I also want to point out that the new 10 year treasury is yielding 2.46% which started the year at 3%. It’s import to know that even though many forecasted rates going up, they have actually come down. Ironically, the Eurozone, which makes up over 20% of the world’s GDP, has started to lower it’s rates and implement quantitative easing.

Will we see another market high?

Here in the United States the Fed has made it known earlier in the year that in October they would stop quantitative easing. There are those who believe once this stops, we will see a market correction. Still others believe the opposite will happen. The analogy is like an inflated balloon that has been pushed under water. Once it is released it will come back to the surface. In like manner, some forecasters believe the market will return to normal once all the factors that have been holding it under water since 2008 release it. Some are saying we could possibly see a new market high with the S&P 500 going even higher than it is now. The NASDAQ and the Dow could also go up as many believe we are in the early stages of a U.S. economic expansion.

We are studying these scenarios very closely to see how they are going to impact our clients’ portfolios. Keep watching our video blog so we can keep you updated.

If you have any questions about your current financial situation, I’d be delighted to talk with you. You can email me here or call me at (205) 989-3498.

Greg Powell, CIMA
President/CEO
Wealth Consultant

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Greg Powell is President and CEO of fi-Plan Partners, an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. fi-Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The S&P 500 index is a measure of performance of the broad domestic economy through 500 stocks from major industries. The NASDAQ Composite represents all the stocks that trade on the Nasdaq. The Dow Jones Industrial Average measures the average price of a group of 30 high value stocks.

Sep 022014
 

New format

Today we are discussing the economic news and data that could impact your portfolio. We are changing our format to bring you this critical information in a more concise presentation. Please let us know what you think about it and if you feel you are still getting the information you need. You can email me here or in the comment space provided below.

The US economy is still looking strong

We are a still looking at the GDP being up 2% for the year and 3% for the first half of the year. The US is still looking strong from an economic and market standpoint. International companies based in the US may feel the impact of European inflation, tensions coming from Russia, and terrorist situations. There is also concern over ISIS and a possible terrorist attack slowing down our growing economy. These terrorist groups have American and British citizens in their forces with passports that give them the ability to come in and out of their home countries freely. That could really cause problems and have a major impact on the US economy.

S&P 500 has hit over 30+ record highs this year

Historically, the S&P 500 has hit over 30+ record highs this year. S&P Marketscope pointed out that in 1995 the S&P hit 500 and the next 30 days was up 4.6%. In 1998 the S&P 500 hit the 1000 mark and was up 7.9% in the following 30 days. In 2007 it was up over 1500 and rose up 2% in the next 30 days. Here we are in 2014 and the S&P 500 is over 2500. We will be watching this closely to see from an historical standpoint if it has a positive up swing.

New economic information this week

The big report this week is the Jobs Report which will be released on Friday. Also on Wednesday we will see a PMI and ISM Manufacturing reports. These reports will give us some very important information on how the US economy is really doing and what we can expect in the future.

I really want to hear from you. Email me your comments and questions here or call me at (205) 989-3498.

Greg Powell, CIMA
President/CEO
Wealth Consultant
Email Greg Powell here

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Greg Powell is President and CEO of fi-Plan Partners, an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. fi-Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The S&P 500 index is a measure of performance of the broad domestic economy through 500 stocks from major industries.

Jul 282014
 

Nervousness In The Markets

Today we are discussing the nervousness in the markets over geopolitical and domestic situations. The DOW Jones has hit new highs eleven times in a row (between May and July) but last week it tapered off. This can impact your broad based portfolio and individual investments.

Vladimir Putin, the situations in the Gaza Strip and Israel have contributed to the Dow ending it’s eleven new highs in a row streak. The nervousness in the markets is really with the individual investors. Corporate America on the other hand, is showing signs of real confidence (more in the video).

Corporate confidence in the markets

We are in the middle of earnings season and half of the S&P 500 companies have published their reports. 76% of those have beaten expectations for their earnings and 67% have beaten expectations on sales. That is in line with what we’ve seen since 2009.

This week we are watching reports coming from:

  1. CPI (Consumer Price Index)
  2. Existing home sales
  3. Durable goods
  4. GDP (Gross Domestic Product)
  5. Employment
  6. Personal income
  7. ISM manufacturing (Institute for Supply Management)

(More on each in the video)

Home sales impact on the economy

We are especially focused on the home sales reports as we’ve had several clients tell us they were sticker shocked at the appraisal on their houses. As we look at these home sales reports, they are not always lining up with our findings.

The new home sales multiplier effect

Even though existing home sales are rising nicely, new home sales are down. They dropped in June by 8.1%. There is an important multiplier effect of a new home sale. If you build a new home, three full-time jobs are created for one year. 1.5 of that is a person who is building your home, the other 1.5 full-time jobs are for products related to building that home. These jobs would be anything from prefabrication, to hardware and furniture sales.

The types jobs related to new home sales are missing from our economy because people are not building as many new homes. People are renovating or buying existing homes. This is another reason investors and consumers are nervous.

The lack of new home sales is important for investors to follow because it is starting to create a broader drag on the economy. It has a lot to do with the nervousness in the markets and with the consumer. Janet Yellen even mentioned recently that new home sales are a problem.

Also contributing to the lack of new home sales is the fact that many younger generations are saying they don’t need a bigger place. There are also those who have just paid off their homes and, after what happened in 2008, are not interested in buying a new home.

Nervousness in the markets from geo political situations

Will Rogers said, “History doesn’t repeat itself but it sure does rhyme.” 100 years after World War I we are seeing some similarities to that time. Russia is again a big player as Vladimir Putin is moving forward on acquiring more territory for Russia adding tension across the globe.

We are will keep you updated as we watch how these political situation could impact you, the investor, and our economy. We still believe there is plenty of opportunities in the market and there is no need to be nervous at this time.

Send us you comments and questions or call us at (205) 989-3498 to discuss with us you current financial situation.
nervousness in the markets
Greg Powell, CIMA
President/CEO
Wealth Consultant
Email Greg here

Franklin Bradford, CMT
Senior Vice President
Wealth Consultant
Email Franklin here

Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant
Email Ashley here

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fi-Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. fi-Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.

The Dow Jones Industrial Average measures the average price of a group of 30 high value stocks. The S&P 500 index is a measure of performance of the broad domestic economy through 500 stocks from major industries.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

Jun 022014
 

Listen to our podcast on iTunes. More information here.

This weeks financial market summary

  1. Books for the investor
  2. Stagflation and deflation
  3. The bond market
  4. HELOC impact on the markets

What happened last week in the markets?

Stocks were up moderately carried by larger cap stocks. Year to date the S&P 500 is up .85 and the S&P 500 is up about 4.

Durable goods where higher expected. GDP, which gives us a good feel for how we are doing as a country, was revised down dramatically but the market still was able to do ok.

As we looked at the personal income numbers we saw income was up and spending was off. While this was a good monthly report, we like to look at the trend and not the month by month data. The PCE inflation measure is below what the Federal Reserve is looking at. We think this is important for investors to monitor as it deals with stocks and bonds.

The second quarter is looking better than the first. There are more reports coming out this week that we will be watching (More in the video).

The bond market is rallying. The media has a different point of view than we do about this (More in the video).

We have been talking about deflation since the beginning of the year in spite of what traditional media is reporting. What we are seeing now tells us we are on the right track for our clients.

Market impact issues

The market is driven as much as 70% by the consumer. Home equity lines of credit (HELOC) are coming due as we move closer to the 10 year mark from when the housing market was good. Many consumers with HELOC will see their payments jump dramatically which will put a drag on consumer spending and impact the markets. If we see any interest rate hike during that time, that could really cause some damage. People could also be enticed to pull their money out of the markets to pay these increasing HELOC payments (More in the video).

There are many variables that are adding pieces to the puzzle. We still feel very good about the current economy provided we maneuver through it. We will keep you updated in our weekly financial market summary. Please send us your questions or comments below, email any of us, or call us at (205) 989-3498.
financial market summary
Greg Powell, CIMA
President/CEO
Wealth Consultant
Email here

Franklin Bradford, CMT
Senior Vice President
Wealth Consultant
Email here

Ashley Page, JD, MBA
Senior Vice President
Email here

Do you have a question about our Financial Market Summary?

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fi-Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. fi-Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.