Have you been watching the markets lately?

Bear Or Bull Market…
Which Is It?

“We are now in a bear market – here’s what that means.” – CNBC headline on December 24, 20181

“The stock market rally to start 2019 is one for the history books.” – CNBC headline on February 22, 20192

If you’re like most people, it’s probably not uncommon for you to plan your day or week based on the weather forecast. For example, you might check the forecast, see that it’s supposed to be sunny, and decide to go fishing on Saturday.
But when Saturday rolls around, it starts to rain.

The frustration you’d feel is very similar to how investors and analysts often feel about the markets. The forecast says one thing – and then the opposite happens.

For example, let’s go back to the end of 2018. For months, the markets had been hammered by volatility. The Nasdaq entered bear market territory. Many pundits predicted even more volatility after the new year.

But four months later, the markets are on the verge of record highs.
So, the question is: Why the change in direction? What’s behind this year’s market rally? And most importantly, what can we learn from it?

The volatility that dominated the end of 2018 was largely due to fears of an economic slowdown. The Federal Reserve raised interest rates, which can cool both inflation and economic growth. Trade tensions with China showed no signs of stopping. Corporate earnings slowed down, oil prices had dropped, and several other indicators had many analysts predicting a recession in 2020 or 2021.

Even after the turn of the year, there was some interesting data that, when compared with historical trends, suggested more storms on the horizon. For example, you may have seen the term “inverted yield curve” bandied about in the media for a time. We’re venturing into “financial nerd” territory here, but this is when the yield on short-term Treasury bonds rises higher than the yield on long-term bonds. It doesn’t happen often, and historically, it has sometimes been a sign of an impending recession. The result of all these signals was a forecast that had many investors reaching for their umbrellas, convinced that gloomy weather was here to stay.

But instead, the markets enjoyed their strongest start to a year since 1998.3
In many ways, this rally has been driven by something very simple: Nothing really got worse. The Federal Reserve has stopped raising interest rates, saying that it won’t raise them again in 2019.4 The trade war with China seems to have hit a lull. And now, investors can point to a host of different historical trends that work in their favor. For example, some data suggests that when the stock market rises 13% or more “during the first three months of a calendar year,” it will gain even more before the end of the year.3

So, does that mean the good times are here to stay?
No.
Warren Buffett, the legendary investor, has a saying: “Be fearful when others are greedy and greedy when others are fearful.” While we shouldn’t take that maxim too literally, it does illustrate an important point. Time after time, conditions that cause fear can change in an instant, leaving the fearful behind. On the other hand, conditions that stoke greed can shift before you know it, giving the greedy a nasty shock.

On their website, CNN has something called the Fear & Greed Index. 5 Using seven different indicators, they can calculate which emotion is driving the markets most at any given time. As of this writing, that emotion is greed. A few months ago, it was fear. As we’ve just seen, the scale can swing from end to another very quickly.

When you look more closely at the data, there are still reasons to think a recession is possible in the next year or two. (A contracting labor market, problems in Europe, stocks being valued too highly, to name just a few.) Other data suggests that the stock market’s current highs are overblown.6 But does this mean it’s time to run and hide? Nope! While data is very good at telling us what was and what is, it’s still unreliable at telling us what will be – at least as far as the markets are concerned. In fact, for as much grief as we give meteorologists for getting a forecast wrong, they do a much better job predicting the weather than experts do the markets!

Here’s what we can learn from all this
As your financial advisor, the reason I’m sending you this letter is because there are a few things I think we need to keep in mind as 2019 rolls on.

First, we need to remember to guard against recency bias. Recency bias is when people make the mistake of thinking what happened recently is what happens usually. It’s why investors tend to panic during market volatility or take on unnecessary risk during a market rally.

Second, remember that emotion is a good servant, but a bad master. Emotion helps us interact with other people. It makes experiences more memorable and life more colorful. But it can be come harmful if it drives our decisions. We should always strive to keep our own personal Fear & Greed Index from swinging too sharply one way or the other.

Finally, whether the markets go up, down, or sideways, you’ll probably hear about many different statistics, indicators, and historical trends that predict this, that, or the other thing. When you do, remember that correlation is not causation.

Correlation, as you probably know, is the measurement of how closely related two things are. In finance, we often find that many things tend to change in sync with one another. Asset classes, market sectors, you name it. It’s why we spend so much time looking at things like inverted yield curves – because they are often correlated with the health of the markets or economy.

But just because two things are correlated does not mean that one causes the other. (It’s why an inverted yield curve doesn’t always mean a recession is nigh.) All the indicators and historical trends you hear about in the news are important, and worth studying – but again, they only tell us what was or what is. Not what will be.

So, to sum up:
• Just as we didn’t give in to fear when the markets were down, so too will we not give in to greed while the markets are up.
• We will remember that sun today doesn’t protect against rain tomorrow, or vice versa.

Instead, we’ll make decisions as we’ve always done: by keeping your long-term goals foremost in our minds. In other words, we’re not working to help you go fishing just this weekend.

We’re working to help you go fishing any weekend you want.

As always, if you have any questions or concerns about the markets, please don’t hesitate to contact us. In the meantime, have a wonderful Spring!

1 “We are now in a bear market – here’s what that means,” CNBC, December 24, 2018. https://www.cnbc.com/2018/12/24/whats-a-bear-market-and-how-long-do-they-usually-last-.html
2 “The stock market rally is one for the history books,” CNBC, February 22, 2019. https://www.cnbc.com/2019/02/22/the-stockmarket-rally-to-start-2019-is-one-for-the-history-books.html
3 “The Stock Market is Having Its Strongest Start in 21 Years,” Money, March 20, 2019. http://money.com/money/5639032/stock-market-strong-start/
4 “Fed holds line on rates, says no more hikes ahead this year,” CNBC, March 20, 2019. https://www.cnbc.com/2019/03/20/fedleaves-rates-unchanged.html
5 “Fear and Greed Index,” CNN Money, accessed April 17, 2019. https://money.cnn.com/data/fear-and-greed/
6 “Dow, S&P 500 and Nasdaq near records but stock-market volumes are the lowest in months,” MarketWatch, April 18, 2019. https://www.marketwatch.com/story/why-stock-market-volumes-are-the-lowest-in-months-as-the-dow-sp-500-and-nasdaq-testrecords-2019-04-17

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Jim Streight James Streight Chief Marketing Officer

SEC warns investors not to base stock decisions on social sentiment

SEC warns investors

not to base stock decisions on social sentiment

Social media posts can have hidden agendas, regulators said.

The Securities and Exchange Commission and the Financial Industry Regulatory Authority Inc. are warning investors about using social media data to make investment decisions.

In recent years, companies like TickerTags, Social Market Analytics and LikeFolio have launched to turn the massive amounts of data on social media into investment research. The idea is that by aggregating and analyzing posts on Twitter, Facebook and others, one can detect a “social sentiment” that predicts future market or economic performance.

For example, if millions of people are tweeting how much they hate the latest iPhone, it could predict Apple falling short on its next earnings report.

Social sentiment data is increasingly popular among both retail and institutional investors. Several companies are providing earnings predictions to individual investors directly, and is selling data to quantitative fund managers.

But the SEC and FINRA said the information on these tools can be inaccurate, incomplete or misleading. Data can be stale or out-of-date, and social media posts may have hidden agendas. The SEC has actually charged someone for sending false tweets in order to influence stock prices.

FINRA’s  The investor alert added that buy or sell indicators driven by social sentiment can lead investors to make emotionally-driven or impulsive investment decisions. The SEC and FINRA advised investors to not rely solely on these tools when making decisions and to stick to a long-term financial plan.

The general consensus is that FINRA is warning investors that if they trade based on social sentiment and lose money, don’t expect FINRA to investigate, even if there is proof there were flaws in the social sentiment provider’s data.  Institutions likely will want to develop clear disclosures and disclaimers for any social sentiment data they make available to investors on their platform.

Financial industry insiders applauded the alert and said the SEC and FINRA correctly identified the issues that may arise for investors.


As always, We are here to help you find the best solution for your situation and your needs. Contact us to set up a free, no obligation consultation.

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So, should you invest in your employer’s 401K account if you’re confused and looking for help with your retirement?  We can manage your 401K, TSA, TSP, Simple Plan or Pension Plan.   If your portfolio lost more than 10% in the last recession, you need to take another look at how you are managing risk.  Consulting with a professional investment advisor at Research Financial Strategies will help you to make important 401K decisions.

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Jim Streight James Streight Chief Marketing Officer

Market Commentary – May 13, 2019

Trade talk trouble took a toll last week. 
Major U.S. stock indices moved lower when trade talks between the United States and China broke down. The Standard & Poor’s (S&P) 500 Index, Nasdaq Composite, and Dow Jones Industrial Index all finished the week down between 2 percent and 3 percent, reported Ben Levisohn of Barron’s.

Despite the weak weekly performance, the S&P 500 remains up 14.9 percent year-to-date.

The deadline to settle U.S.-China trade issues was Friday. When it passed without any resolution, the U.S. increased tariffs on Chinese goods to 25 percent, reported the BBC.

The economic impact of higher tariffs may be relatively small; however, the impact on business confidence and global markets could be significant, reported Capital Economics.

“We think that the direct effects of President Trump’s threatened tariff hikes could reduce Chinese GDP by up to 0.4 percent and that the associated retaliation would have only a marginal direct impact on the United States. The effects on business confidence and financial markets around the world could be more significant, potentially adding to reasons for renewed policy loosening…In theory, if all else were unchanged, the increase in tariffs would amount to a small fiscal tightening in China and the United States. But both governments have avoided this by spending the proceeds on aid for the most affected parties.”

Bond markets reflected uncertainty, too. The yield curve, which has been flirting with inversion for some time, inverted briefly on Thursday, reported Alex Harris of Bloomberg. A persistent inverted yield curve – featuring a lower yield for 10-year Treasuries than for three-month Treasuries – sometimes signals recession.

David Lynch and Heather Long of The Washington Post reported tariffs imposed on other countries have yet to be removed, including those on steel and aluminum imported from Mexico and Canada.

Trade negotiations between the United States and China are expected to continue.

Independent thinking is important. In The Wisdom of Crowds, James Surowiecki shared a story about Francis Galton, a Victorian-era statistician and scientist whose “…experiments left him with little faith in the intelligence of the average person.”

Jacob Goldstein and David Kestenbaum of Planet Money summarized the story like this:

 “One day, Galton goes to a country fair. This was about a hundred years ago in England. And there’s this contest going on at the fair – guess the weight of the ox. Galton’s a scientist and a statistician. And he figures, hey, I can do an experiment here, right? He figures, I’m going to take everyone’s guesses, take the average and compare that to the actual weight of the ox…The ox weighed 1,198 pounds.”

The average of the estimates was 1,197 pounds. The result surprised Galton and it surprises other people who hear the story, too.

Goldstein and Kestenbaum decided to replicate the experiment by visiting a fair, weighing a cow, posting a picture of the cow online (next to a photo of Goldstein that shared his weight), and asking people to estimate the cow’s weight.

More than 17,000 people responded.

After removing outliers, the average estimate of the cow’s weight came in at 1,287 pounds. The cow weighed 1,355 pounds.

How can a group of people, few of whom knew anything about cows, get so close to a correct answer? The key is that each guess is made independently:

“…Every person’s guess is contributing some new, little piece of information. Everybody is different. Everybody thinks slightly differently when they’re trying to guess the cow’s weight. Maybe one person studies that photo of the cow from the side. Some people are probably trying to figure out how many Jacobs would fit in the cow. Someone else might know how much a horse weighs and kind of go from there.”

That’s not to say collective thinking is always accurate. There are terms in our vocabulary – mob mentality, herd thinking, groupthink, and others – that often are used to describe groups getting it wrong.

Consider the stock market. You don’t need to look far to find examples of what can happen when people push a company’s share price or a stock market to an unreasonable level.

Apparently, the wisdom of the crowd is found in thinking independently, together.

Weekly Focus – Think About It
“In a basic agricultural society, it’s easy enough to swap five chickens for a new dress or to pay a schoolteacher with a goat and three sacks of rice. Barter works less well in a more advanced economy. The logistical challenges of using chickens to buy books on Amazon.com would be formidable.”
–Charles Wheelan, American Journalist

Best regards,
John F. Reutemann, Jr., CLU, CFP®

 

P.S.  Please feel free to forward this commentary to family, friends, or colleagues. If you would like us to add them to the list, please reply to this email with their email address and we will ask for their permission to be added.

Investment advice offered through Research Financial Strategies, a registered investment advisor.

S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT Total Return Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

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* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.  However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* You cannot invest directly in an index.
* Stock investing involves risk including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
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* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
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Sources:
https://www.barrons.com/articles/dow-drops-2-1-as-tariffs-unexpectedly-return-51557541449?mod=hp_DAY_7 https://www.bbc.com/news/business-48210313
https://research.cdn-1.capitaleconomics.com/a603fb/the-implications-of-a-collapse-in-us-china-trade-talks.pdf https://www.bloomberg.com/news/articles/2019-05-09/u-s-yield-curve-inverts-for-the-first-time-since-march
https://www.barrons.com/articles/yield-curve-inverted-recession-indicator-51557420751?mod=article_inline The_Yield_Curve_Inverted_Again_but_that_Doesnt_Mean_a_Recession_is_Coming-Footnote_5.pdf
https://www.washingtonpost.com/business/economy/trumps-tariffs-once-described-as-negotiating-tools-may-be-here-to-stay/2019/05/10/8a55b69e-735d-11e9-8be0-ca575670e91c_story.html?noredirect=on&utm_term=.0fa3633795e1 https://www.amazon.com/Wisdom-Crowds-James-Surowiecki/dp/0385721706
https://www.npr.org/templates/transcript/transcript.php?storyId=714289051
https://people.howstuffworks.com/riot3.htm
https://www.merriam-webster.com/dictionary/groupthink
https://www.goodreads.com/quotes/tag/barter

The USA’s GDP vs China and the World

Open any newspaper or tune in to your favorite news channel and you will find much talk about how China is taking over the world’s economy. They have made incredible strides in building infrastructure, manufacturing and their military during the past few decades.  In fact, there’s so much talk today about their incredible growth rate and the power of their economy; we may forget just how good we are doing in the United States.

The magnitude of what they have accomplished in such a short period of time is amazing. They’ve literally flooded millions of people from their rural hometowns with the Three Gorges project and forced them to move to the cities. They are relocating 250 million people, according to a NY Times report, from the countryside to the city, from farms to factories.

Whether it’s a national news channel or an every day American, many believe that our country’s best days are behind us.  One easy way to understand if the economic growth of the USA is healthy is to examine our GDP vs. world GDP.  GDP = Gross Domestic Product. It’s the total of all the goods and services each country provides to the world economy. The table below with data from World Bank has some statistics for comparison:

When we examine the graphic, the USA is in the top spot generating 24.4% of world GDP with 4.6% of the world population. China is number 2 producing 15.4% of world GDP with 23% of the world’s population. Those numbers are worth reading again!

The USA is still way ahead of other countries!  We are 80% smaller than China, yet we are almost double their GDP.

A strong economy brings great wealth. The rule of law and personal property rights are two of the most basic principles of a capitalistic economy. The USA maintains both.. Not so much in China. Hence, the emerging problem in China.  The Chinese can create excessive amounts of wealth and then what? Many leave China and they take their wealth with them. That is because at the end of their life someone in the Chinese government is just going to take it.  But in the USA, it is different. Your cars, investments, homes and possessions. You get to determine the final distribution of your possessions.  That’s personal property rights and the rule of law protecting you. Two totally different philosophies!

Examining the table further, Japan is the third largest economy. Remember what everyone said about Japan in the late 80’s? Japan was faster and more nimble than the USA. Well, their economy peaked in 1989 at 13.9% of the world’s GDP. Currently, Japan produces 6.13% of the world’s GDP.

India and Russia both have a large population and are nuclear powers. Combines they have 42% of world population. Yet, combined at 5.26% GDP, they do not even exceed Japan!

Recently, India’s economy is growing enormously. They also have personal property rights similar to the USA. They maintain the rule of law and are the world’s largest democracy. India has been working industriously to grow their economy. If there’s one country on this list who has the potential sometime in the future to better the US in GDP, it’s most likely India.

The Russians have always been on everybody’s radar. A significant amount of their GDP involves energy production but their growth has all but stagnated.

This is a lot of information to consider. The USA is the most productive country on Earth. No other country is even close.  China has had a 1000 year head start on us. (How come we don’t hear about this on the news every night!)

The constant talk of a trade war and tariff’s is overblown. Many people believe it won’t affect the USA much in the long run. We have had tariffs for years. Our trading partners had tariffs against us which were usually higher. For example, we held a 2.5% tariff on German cars being imported into the US but paid 10% on US vehicle entering into Germany. Very lopsided and ignored by our politicians for a long time. We’ve had trade wars before. We survived because we are very resilient and the rest of the world relies on our productivity. A trade war and tariff’s will hurt the Chinese economy much greater and my guess is they will eventually come to the table and negotiate a fair deal for everyone.

We are in a very strong negotiating position in the USA. Our people have always been driven by independence, innovation, and the pursuit to do better. We attract some of the greatest talent of the world to increase our productivity and lead the way in industry after industry.

Final thought: The United States of America isn’t going to relinquish our top GDP title anytime soon. Someday it may happen- maybe it will be India- but it will be a long time from today.

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Market Commentary – May 6, 2019

The Standard & Poor’s 500 Index is off to its best start in 20 years. 

Despite the exceptional performance of U.S. stock markets year-to-date, and data that suggest economic growth remains steady, some analysts and investors have been pecking at Federal Reserve Chair Jerome Powell. They’re keen for the Fed to implement a rate cut, which could stimulate economic growth and help push stock markets higher, because inflation is lower than ideal, reported Howard Schneider and Ann Saphir of Reuters.

Recent data suggest core inflation is at 1.6 percent. That’s below the Fed’s target rate of 2 percent. Fed leaders have said they think low inflation may be temporary. Until a trend has been established to their satisfaction, they intend to do nothing. The Reuters article explained, “…preemptive…rate moves in either direction appear off the table for now, absent some unexpected event that raises new risks or shocks the economy into a higher or lower gear.”

Second-guessing the Fed is not new. In 1955, the ninth Chairman of the Federal Reserve, William McChesney Martin, offered this insight to the Fed’s work:

“Those who have the task of making [credit and monetary] policy don’t expect you to applaud. The Federal Reserve…is in the position of the chaperone who has ordered the punch bowl removed just when the party was really warming up.”

On Friday, jobs data suggested U.S. economic growth continues apace. The Bureau of Labor Statistics report showed unemployment was at a 49-year low. The news made investors happy, and the Nasdaq Composite and S&P 500 finished the week higher.

Overlooked economic indicators. Last week, the Federal Reserve Open Market Committee statement indicated inflation was below target levels. The report stated, “On a 12-month basis, overall inflation and inflation for items other than food and energy have declined and are running below 2 percent.”

A less respected economic indicator is telling a similar story about inflation. The Tooth Fairy Index confirms the value of a baby tooth isn’t what it used to be. For the second consecutive year, the average monetary gift left behind by the Tooth Fairy was less generous. In 2018, it fell 43 cents to $3.70, on average.

There are regional differences. West Coast Tooth Fairies are, typically, more generous than Midwest tooth fairies. The regional numbers for 2018 looked like this:

  • $4.19 was the average payout on the West Coast. That’s down 66 cents from $4.85 in 2017.
  • $3.91 was the average payout in the South. That’s down 21 cents from $4.12 in 2017.
  • $3.75 was the average payout in the Northeast. That’s down 60 cents from $4.35 in 2017.
  • $2.97 was the average payout in the Midwest. That’s down 47 cents from $3.44 in 2017.

The first baby tooth lost continues to command a higher value than other teeth. It was worth $4.96, on average, across the country.

The non-monetary benefits of impending Tooth Fairy visits can be significant. They may include: 1) early bedtime in anticipation of the visit; 2) joy when compensated for a lost tooth; 3) a chance to discuss the importance of oral hygiene; and 4) the opportunity to teach kids about saving.

Weekly Focus – Think About It
“Joy, feeling one’s own value, being appreciated and loved by others, feeling useful and capable of production are all factors of enormous value for the human soul.”
–Maria Montessori, Italian physician and educator

Best regards,
John F. Reutemann, Jr., CLU, CFP®

P.S.  Please feel free to forward this commentary to family, friends, or colleagues. If you would like us to add them to the list, please reply to this email with their email address and we will ask for their permission to be added.

Investment advice offered through Research Financial Strategies, a registered investment advisor.

S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT Total Return Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

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* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.  However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
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* You cannot invest directly in an index.
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* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
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Sources:
https://www.barrons.com/articles/after-the-s-ps-hot-start-to-2019-risks-loom-larger-51556935408?mod=past_editions https://www.reuters.com/article/us-usa-fed-inflation/fed-insurance-rate-cut-not-likely-soon-as-economy-hums-along-idUSKCN1S91X4
https://www.bradford-delong.com/2013/06/tim-taylor-sends-us-to-william-mcchesney-martins-punchbowl-speech-october-19-1955.html
https://www.bls.gov/news.release/empsit.nr0.htm
https://www.federalreserve.gov/newsevents/pressreleases/monetary20190501a.htm?mod=djem_b_reviewpreview_20190501&mod=article_inline
https://www.theoriginaltoothfairypoll.com/news-release-parent/
https://www.brainyquote.com/quotes/maria_montessori_752858

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