Jul 072014
 

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Economic trends that could affect your portfolio:

  • Unemployment
  • Inflation
  • Market all-time highs

Economic Trends and numbers

One of the biggest economic trends right now is how unemployment is continuing to come down but the numbers from the Labor Department are deceiving (more in the video).

Another economic trend that we have been talking about for several years here at fi-Plan Partners is how business models are changing, especially in healthcare and education. It’s called “Creative Disruption” and it’s being caused by innovation. As old industry models are crumbling, innovation is allowing for the creation of new models. Last week’s edition of The Economist magazine has “Creative Disruption” on the cover. It discusses education and especially how online education is dramatically changing universities.

As we watch the employment numbers rise, The Economist is telling us that by 2025, two thirds of universities could be closed or drastically changing how they operate. We look at these kinds of trends for our clients to find new investments that will benefit from these changes (more in the video).

We are also seeing market highs as well as inflation and prices going up. It’s important for investors to know tht if your portfolio is not staying ahead of inflation, you are not going to have enough money to continue living the lifestyle you’ve grown accustom to.

The economic trend of another market all-time high

The week was pretty slow until Thursday when we saw the DOW hit an all-time high at 17,000 points being pushed by the employment numbers. From a historical perspective, this is occurring quite differently than in the past (more in the video).

Why are we concerned about this? The employment report comes out at the beginning of the month and it covers all areas of the economy. The big take away is that this report shows how retail stores are hiring. This is important data about the economy because it tells us that the retail industry is confident that people are going to be buying products. This is confirming the second quarter momentum we have been seeing.

The ISM manufacturing report is also giving us a good feel for the economy and we are looking at the details closely. This week begins the earnings season which we will be analyzing beginning on Thursday when those numbers come out. Currently, we are watching the data that the Federal Reserve is focused on, as well as what the everyday individual is seeing in the economy. You may be seeing prices rising at the grocery store on meat, seafood, milk, cheese and other perishable products. Between disease and droughts, the meat industry is being hit hard (more in the video).

What is impacting your wallet?

The Fed is trying to control the economy to keep inflation in a “sweet spot” (more in the video). The Fed is looking at every bit of data that has to do with food and fuel which comes from The Personal Consumption Expenditure Price Index. That index is going up and we are watching this closely, as we could be seeing an important turn as people are impacted in their wallets (more in the video).

We celebrated independence this weekend and as an independent wealth management firm, we keep up with all this data and more to help guide our clients towards more independence. Our independence as a financial firm gives us access to so much data that we are confident we provide a higher level of service to our clients.
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Greg Powell, CIMA
President/CEO
Wealth Consultant
Email Greg here

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

Franklin Bradford, CMT
Senior Vice President
Wealth Consultant
Email Franklin 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 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 302014
 

Summary:

  1. Deflation
  2. Economic data from last week
  3. Economic data for this week
  4. Headlines, innovation, and the American dream

The Deflation Issue in Europe

When you use historical information about the deflation that we saw in Japan in the 1990s, it is easy to see several key similarities to what is currently happening in Europe. The interesting part is that while the decline in Japan was gradual, what we are seeing in Europe is much more dramatic. However, in terms of growth and demographics we feel that Europe may be better equipped to avoid a major deflation. In other ways they are not as strong. In the video I discuss several of these key factors, both positive and negative, that could determine what we see in Europe. We will also tell you why we feel these issues could impact your portfolio. (More in the video)

Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant

Last Week In The Economy

Last week was rather subdued in the markets, and the Fed’s comments on wether or not they may raise interest rates contributed to not a lot of money being put into the markets. We did see mixed economic data in the consumer and manufacturing sectors. Durable goods also slipped and in the video I will tell you more about why I feel that durable goods orders is a trend we like to watch as investors. The big shock last week came from the release of the government’s 3rd revision of 1st quarter’s GDP. It is important to note that while this was a big headline and generated a lot of media coverage, there was not a big response in the market.

This Week in The Economy

The big news that we will be watching this week is the employment situation report that will come out on Thursday. We will also be watching to see the impact of the announcement from the Presidential administration that U.S. companies can now export oil. Exporting oil has been illegal since the 1970s which makes the announcement a major headline in the media but in the end, like the GDP revision, may have less impact on the market than expected. We will continue to monitor the economic data and how each issues could impact your portfolio. (More in the video)

Franklin Bradford, CMT
Senior Vice President
Wealth Consultant

The American Dream And Your Financial House

Like we saw with the economic data that Franklin shared, there are a lot of headlines in the media right now that could impact your portfolio and the market. As we approach the 4th of July, it is important to realize that we are living in one of the greatest periods of innovation in this country. In the video I discuss how we at fi-Plan Partners feel like this is an opportunity to create your own economy. The trends in technology and entrepreneurship we are seeing in the headlines will have an impact on your future and your achievement of the “American Dream”. As a client, when you talk to us about your Financial Blueprint and Your Financial House we believe this represents the building of your own personal American Dream. (More in the video)
impact your portfolio video thumb
We hope that you all have a wonderful 4th of July!

Greg Powell, CIMA
President/CEO
Wealth Consultant

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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 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.

NASDAQ Composite Index represents all the stocks that trade on the Nasdaq

Dow Jones Industrial Average Index measures the average price of a group of 30 high value stocks

S&P 500 Index is designed to measure performance of the broad domestic economy through 500 stocks representing all major industries

Jun 022014
 

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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.

May 302014
 

Markets are still reaching all time highs

Six months ago I posted a video concerning the markets hitting all time highs and how that relates to your portfolio. Here we are now, months later, and we are still seeing stock market all time highs. While this is good for the markets, this can be a stumbling block for some investors in relation to how they view their investments.

Importance for investors

I am reposting this vlog with a new introduction because I believe it is important for investors to have a proper perspective on the markets so they can make good investment decisions. The question you need to ask is, “How should you evaluate your portfolio in comparison to the record highs of the various stock market indices like the S&P 500 and the DOW?”

If investors gain a proper perspective on these indices, they can learn much about their investments and how to work towards achieving their financial goals.
Stock market hit all time high
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.

Apr 282014
 

Are all stocks in the S&P 500 created equal?

The Standard and Poor’s 500 is a collection of 500 stocks that is a broad spectrum of the the stock market for the United States. Using the S&P 500 gives us an overall view of the U.S. economy. Each stock in the S&P 500 is weighted differently meaning that a stock will impact the index more or less than another.

A simple explanation of this is to compare the S&P 500 to the United States House of Representatives. Each state has a certain number of representatives in the House depending on it’s population.

The S and P 500 is like the House of Representatives

California is our most populated state carrying 12% of the country’s population. Therefore, California has 12% of the representatives in the house. Less populated states have fewer representatives. It follows that California could have more of an impact on decisions made in the House of Representatives than other less populated states who have less representatives.

Which stock will move the S&P 500 more

A bigger company whose stock is in the S&P 500 that has more shares outstanding will have a bigger impact on the index when it goes up or down than a smaller company stock. A large technology company selling smartphones and computers will have a heavier weighting in the S&P 500. When its stock moves, the S&P 500 moves.

Note: Indices such as the S & P 500 may not be invested into directly.

Understanding this is important to investors as they see the S&P 500 fluctuate. Knowing which stocks are weighted heavier than others will give investors a proper perspective on market growth and volatility, and help them make better decisions about their investments.

What part of the investing world would you like me to discuss next? Please comment below, email here, or call me at (205) 989-3498.

Franklin Bradford imageFranklin Bradford, CMT
Senior Vice President
Wealth ConsultantS&P 500 Stocks video

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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.

Apr 072014
 

Friday’s market drop

Last Friday we saw a market drop as the NASDAX sank about 2.6 % and the S&P dipped about 1%. In the investing world, often a market drop is not something you should take at face value.

When is a market drop good?

Our research is showing us that this market drop could be a response to a rotation of investors moving out of growth stocks into value stocks. This type of market drop usually happens as people begin looking at the earnings of growth stock companies in anticipation of earnings season. This is an underlying positive factor that shows people are more confident in the over all direction of the economy.

Permanent temporary jobs are affecting short term interest rates

As we have been saying since the beginning of the year, the Fed is going to have a hard time predicting when to make a change in short term interest rates. Part of the reason for this difficulty is because what is going on in the job market. Most of the new jobs are temporary jobs that are becoming permanent temporary jobs. This adds more to the layers in the job numbers that is making it difficult for the Fed. We’ve seen this happen before in 2000 and 2001, but it didn’t sustain itself very long.

Many economists are predicting that this permanent temporary job environment could go on for a long period of time. This is because of underlying systemic weakness in the labor market.
Market Drop video image

What we are watching this week

One thing we have been watching is corporate share buy backs which were up 29% by the end of the first quarter. Corporate share buy backs normally parallel a bull market. This process is a value enhancement move by corporations intended to increase the value of their stock. Interestingly, the amount of per share impact that it is having is considerably less than normal. This means that the corporations are not getting as much bang for their buck.

Ashley Page ImageIn addition, we will continue to watch this rotation out of growth stocks into valued stocks and look for trends and impact on the markets. It is important for investors to remember that often when you see a drop in the market, as we did last Friday, it is not always as it seems. It could be a reflection that certain companies are not doing well but it could also just be an investor rotation.

Please comment below, email me here or call me should you have any questions.

Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant

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Ashley Page is a Senior Vice President and Wealth Consultant at 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.