Market Commentary – December 16, 2019

Market Commentary – December 16, 2019

Weekly Financial Market Commentary

December 16, 2019

Our Mission Is To Create And Preserve Client Wealth

So, what comes next?
Last week was a good week for investors. Ben Levisohn of Barron’s explained:  

“The Federal Reserve and European Central Bank both pledged to do what they could to underpin their respective economies. The United Kingdom gave Boris Johnson’s Conservative Party a landslide victory, virtually guaranteeing that the Brexit saga will end, finally.”

‘Get Brexit done’ was the slogan of Prime Minister Boris Johnson’s conservative party and British voters confirmed that’s what they want. As a result, Parliament is likely to accept the Prime Minister’s withdrawal agreement. Under current deadlines, the United Kingdom will begin to transition out of the European Union (EU) at the end of January, reported The Economist.

Prime Minister Johnson promised to complete the transition by December 2020 despite skepticism about whether trade agreements can be negotiated and ratified in such a short time. The Economist reported, “…unless Mr. Johnson is ready to ask for an extension, the risk of Britain leaving the EU with no trade deal in place at the end of next year will be significant. The result would be high barriers to exports and severe disruption to trade.”

There was another important event last week. The United States government announced, “…a phase-one deal with China had been completed and that negotiations on phase two would begin immediately. Details were lacking, but it was surely good news,” reported Levisohn.

The Wall Street Journal reported the deal has been agreed to in principle, although nothing has been signed, and neither the United States nor the Chinese government released the text of the agreement or a detailed summary.

The information released indicates the United States cancelled tariffs scheduled to take effect last Sunday and reduced current tariffs on $120 million of Chinese goods. In return, China agreed to increase purchases of agricultural goods over the next two years. The agreement is scheduled to be signed in January.

Let’s hope they ink the deal!

life begins at 40. In 1932, psychologist Walter Pitkin published a self-help book called ‘Life Begins at Forty.’ The Economist summarized his findings like this, “The theory goes that years of hard work are rewarded with less stress and better pay; children begin to fly the nest; and with luck, a decent period of good health remains.”

At the time, the book was something of a revelation. After all, throughout much of the 1800s, life expectancy at birth was about 40. When Pitkin wrote his book, newborn Americans were expected to reach age 60, on average.

It turns out Pitkin was on to something.

The Economist reviewed the findings of the 2019 World Happiness Report, which uses data from the Gallup World Poll. It found people in the United States and around the world generally are happy in their teens and early 20s. By the time they reach their 30s, however, happiness levels have dropped. People begin to recover a more positive state of mind at age 40. For many, by age 70, self-reported happiness is higher than it was in their teens and 20s.

There are differences in self-reported happiness from country to country. For instance, happiness in former Soviet states tends to decline with age. In addition, overall, self-reported happiness in India has declined during the past several years.

So, who are happiest people in the world? American women age 70 and older!

Weekly Focus – Think About It
“I am still every age that I have been. Because I was once a child, I am always a child. Because I was once a searching adolescent, given to moods and ecstasies, these are still part of me, and always will be…Far too many people misunderstand what ‘putting away childish things’ means, and think that forgetting what it is like to think and feel and touch and smell and taste and see and hear like a three-year-old or a thirteen-year-old or a twenty-three-year-old means being grownup. When I’m with these people I, like the kids, feel that if this is what it means to be a grown-up, then I don’t ever want to be one. Instead of which, if I can retain a child’s awareness and joy, and be fifty-one, then I will really learn what it means to be grownup.”
–Madeleine L’Engle, Author and poet

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.

Treasury Note is simply the yield at the close of the day on each of the historical time periods. 
Sources: Yahoo! Finance, MarketWatch, 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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* This newsletter and commentary expressed should not be construed as investment advice.
* 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. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* 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.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
* To unsubscribe from the Weekly Market Commentary please reply to this e-mail with “Unsubscribe” in the subject.

Sources:
https://www.barrons.com/articles/lots-went-right-for-investors-this-week-the-dow-still-ended-friday-on-a-flat-note-51576282633?mod=hp_DAY_4 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-16-19_Barrons-Lots_Went_Right_for_Investors_this_Week-The_Dow_Still_Ended_Friday_on_a_Flat_Note-Footnote_1.pdf)
https://www.economist.com/britain/2019/12/13/boris-johnsons-big-win?cid1=cust/ednew/n/bl/n/2019/12/13n/owned/n/n/nwl/n/n/NA/360436/n (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-16-19_TheEconomist-Boris_Johnsons_Big_Win-Footnote_2.pdf)
https://www.wsj.com/articles/us-china-confirm-reaching-phase-one-trade-deal-11576234325 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-16-19_WSJ-US_China_Agree_to_Limited_Deal_to_Halt_Trade_War-Footnote_3.pdf)
https://www.amazon.com/Life-Begins-Forty-Walter-Pitkin/dp/B00085JNB4
https://www.economist.com/graphic-detail/2019/04/12/do-people-become-happier-after-40 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-16-19_TheEconomist-Do_People_Become_Happier_After_40-Footnote_5.pdf)
https://www.infoplease.com/us/mortality/life-expectancy-age-1850-2011
https://www.thecut.com/2014/09/25-famous-women-on-aging.html

Market Commentary – December 9, 2019

Market Commentary – December 9, 2019

Weekly Financial Market Commentary

December 9, 2019

Our Mission Is To Create And Preserve Client Wealth

Ahh, the power of distraction.
On Friday, the unemployment report flashed its numbers like a hair model in a shampoo commercial. The Bureau of Labor Statistics reported 266,000 new jobs were created in November. That was better than expected even after deducting the 40,000-plus General Motors employees returning to work, reported CNBC.

The sign of economic strength helped major U.S. stock indices recover from losses suffered earlier in the week – mostly.

The week got off to a rough start when President Trump indicated there was little urgency to resolving the trade dispute with China. The statement upset expectations a phase one trade deal would be completed before December 15. That’s the date the United States is scheduled to put additional tariffs on Chinese consumer goods. New tariffs could inspire additional actions by the Chinese government that affect economic growth in the United States.

To date, U.S. economic growth has slowed from 3.1 percent in the first quarter of 2019 to 1.9 percent in the third quarter.

The slowdown was caused, in part, by Chinese tariffs on American products. Tariffs have had a negative effect on manufacturing and agriculture, as well as other sectors of the market. Trade uncertainty also has led to a decline in business investment. When business investment drops so does the economy’s growth potential. The main engine behind U.S. economic growth has been and remains the American people. Consumer spending accounted for 68 percent of U.S. economic growth in the third quarter.

The Standard & Poor’s 500 Index finished the week in positive territory. The Dow Jones Industrial Average and Nasdaq Composite finished down 0.1 percent.

The evolving etiquette of social media.
Social media etiquette makes remembering when to use the little fork on the right – you know, the one next to the two knives and spoon (the oyster fork) – seem like a snap.

When social media platforms were gaining popularity, they offered an opportunity to reconnect and stay in touch with friends and family. During the past decade, many people joined platforms and built networks. They also started to engage in some unwelcome behaviors. Sometimes, social media is a place where people:  “…can say mean things without showing their face, discriminate with little consequence, and spill details nobody truly wants to hear,” explained Influence.co. “…it’s vital for people to remember that social media is meant to bring people together and that our online behavior can quickly come between us.”

To make it easier to understand which behaviors these are, the organization conducted a survey. The top digital don’ts included:

  1. Bullying others in comments (91.1 percent)
  2. Sharing discriminatory content (89.2 percent)
  3. Posting fake news (88.8 percent)
  4. Making passive-aggressive posts (78.5 percent)
  5. Oversharing personal details (77.4 percent)
  6. Complaining about a partner (75.8 percent)
  7. Giving medical advice (48.3 percent)
  8. Excessive hashtag use (33.8 percent)

It’s also a poor idea to post content about another person without their permission. One in 10 respondents had ended a friendship over it. Finally, many people find it irritating when asked to delay eating a meal so a dinner companion can photograph it.

It’s food for thought.

Weekly Focus – Think About It
“One of the big no-no’s in cyberspace is that you do not go into a social activity, a chat group, or something like that, and start advertising or selling things. This etiquette rule is an attempt to separate one’s social life, which should be pure enjoyment and relaxation, from the pressures of work.”
–Judith Martin, a.k.a. Miss Manners, Etiquette authority

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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* This newsletter and commentary expressed should not be construed as investment advice.
* 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. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* 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.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
* To unsubscribe from the Weekly Market Commentary please reply to this e-mail with “Unsubscribe” in the subject.

Sources:
https://www.bls.gov/news.release/empsit.nr0.htm
https://www.cnbc.com/2019/12/06/us-nonfarm-payrolls-november-2019.html
https://www.barrons.com/articles/dow-jones-industrial-average-ends-week-lower-despite-strong-jobs-report-51575684786?mod=hp_DAY_3 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-09-19_Barrons-The_Jobs_Numbers_were_Great-The_Dow_Still_Finished_Down_for_the_Week-Footnote_3.pdf)
https://www.marketwatch.com/story/did-trump-talk-bluster-or-was-he-hinting-that-china-talks-collapse-either-way-stock-futures-slump-2019-12-03
https://apps.bea.gov/scb/2019/11-november/pdf/1119-gdp-economy.pdf
https://www.bea.gov/news/2019/gross-domestic-product-1st-quarter-2019-advance-estimate
https://www.npr.org/2019/12/06/785280703/how-hard-are-tariffs-hitting-the-economy-it-depends-on-who-you-ask
https://fred.stlouisfed.org/series/W790RC1Q027SBEA
https://www3.nd.edu/~cwilber/econ504/504book/outln11b.html
https://emilypost.com/advice/formal-place-setting/
https://influence.co/go/content/social-media-etiquette.htm
https://www.brainyquote.com/quotes/judith_martin_581570?src=t_etiquette

What’s the Best Gift this Holiday Season?

What’s the Best Gift this Holiday Season?

What’s the Best Gift this Holiday Season?

Staying safe in a digital world
Let's Talk!

You’ve probably never asked your adult children and younger relatives whether they have security software on their computers and devices. Why would you? They’re digital natives, born with keyboards under their fingertips.

It may be time to ask.

In an unexpected twist, the best gift for some younger Americans this holiday season may be data protection software or services. A 2019 You.gov poll reported 35 percent of Americans, ages 18 to 34, think their data and personal information is ‘not very or not at all vulnerable’ to hackers.1

Those feelings of invulnerability aren’t the result of scrupulous digital security strategies. One-third of younger Americans polled indicated they didn’t pay for or use free programs to protect computers and personal data (or they did not know if data protection was in place).1

It’s remarkable the most digitally savvy among us aren’t the most concerned about data safety when a hacker attacks every 39 seconds, according to Security Magazine. Within just a few years, Cyber Security Ventures expects cybercrime to become “more profitable than the global trade of all major illegal drugs combined.”2, 3

Curiously, older Americans – the same group that provides ample fuel for social media groups where younger generations entertain themselves by ‘talking like boomers’ – appear to take cyber threats more seriously than younger ones do.1, 4

The You.gov poll found 80 percent of Americans over age 55 have digital security measures in place. If you’re not one of them, it’s time for you to protect yourself. Hackers and cybercriminals prefer easy marks, and you don’t want to be one.1

Digital security basics
Protecting personal and financial data means forming good digital habits, as well as using reputable security software. Here are a few digital do’s and don’ts. (You may want to share them in the holiday card you send to younger relatives.)

  • Do stay up-to-date. Periodically, you receive notices indicating your computer’s operating system or an application should be updated. When they arrive, take a few minutes to install the update. Out-of-date systems and software make you vulnerable to attacks.5
  • Do think carefully about privacy. In an unwelcome development, some third-party apps may have been reading your email. A large mail provider gave the apps access, and the people using the mail service agreed to it in the privacy policy they may not have read. After The Wall Street Journal reported the practice, the U.S. Senate sent a letter to the mail provider asking it to reconsider its practices.6
  • Don’t skimp on passwords. Sure, it’s easier to remember your password when it’s the same for everything. Using the same password also makes it easier for cybercriminals to access every account you have when a data breach occurs. Create a different password for every account and consider using an encrypted password manager to keep track of them.5

When it comes to passwords, the Federal Trade Commission recommends, “Be creative: think of a special phrase and use the first letter of each word as your password. Substitute numbers for some words or letters. For example, “I want to see the Pacific Ocean” could become “1W2CtPo.”7

  • Do use multifactor authentication. Usernames and passwords don’t provide enough protection anymore. The National Institute for Standards and Technology recommends multifactor authentication (MFA). It offers an additional layer of security.8

For instance, imagine a hacker logs into your bank account using your username and password (possibly obtained from a data breach). If you have MFA, instead of providing immediate access to your account, the bank will send an authentication code to your cell phone or email. The code must be entered before account access is granted. With the code, the crime is thwarted.8

  • Don’t send personal information via public Wi-Fi. When you have limited Internet access, you may only have access to the Internet via public Wi-Fi. If possible, avoid logging into password-protected accounts. Public Wi-Fi is not secure, reported CSO Online. A better option may be to use your smartphone as a hot spot, as long as you have protected it with a strong password.9, 10

The do’s and don’ts of digital security are important because your data is vulnerable and you cannot always protect it. The companies you work for, and do business with, are vulnerable to cyberattack even when they have strong protections in place. Forbes reported cybersecurity experts no longer believe it’s possible to prevent intrusions. Instead, they advise companies to build systems to limit the data that can be accessed during a breach.11

Educating yourself and your loved ones about digital security and adopting security practices that layer protections is critical. During the holiday season, try talking about digital security. It could be the best gift you give.

Are you looking for a financial advisor?  Do you feel confident about your retirement account decisions? Business owner looking for a company 401K plan administrator? Or an athlete or high net worth individual needing long term financial planning advice? Research Financial Strategies can help. We are here to help you design a financial strategy that is molded specifically for you. One that changes as your life changes. Financial investments to help you live worry-free now and in the future.

In our experience, we’ve found that the most successful solutions begin by asking the right questions.
We gain a broader perspective of your goals and the future you wish to create

Today is a Good Day to Start Your Financial Plan

1. We Listen

Our focus is on your life and priorities. Not just your portfolio. That’s why we start by listening and learning about you. Each individual client has different needs and concerns that need to be addressed. We carefully listen to those concerns. We will gain important information that will help us to best serve our clients and help protect their financial futures.

2. Plan

Together we will work to implement the plan that was developed for you. We will keep you constantly updated on what is happening and evolve our plan as your life happens.
Above all, our advisors want to help you meet your goals, even if that means helping you find out what your goals are.

3. We Take Care Of The Rest

We are here for you whenever you need us. Call your Research Financial Strategies Financial Advisor at any time, for any reason. You will always have access to the guidance you need whether it is high tech, high touch or a combination of the two. Your personal Financial Advisor will help you figure out how to pay for life’s great adventures!

 

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Market Commentary – December 9, 2019

Market Commentary – December 2, 2019

It’s a shopping revolution!
Sometime, probably not so long ago, comedian Dave Barry wrote, “Once again, we come to the Holiday Season, a deeply religious time that each of us observes, in his own way, by going to the mall of his choice.”

Not so much anymore.

On Black Friday 2019, many shoppers didn’t venture any farther than their favorite digital device. CNBC reported, “The pullback in brick-and-mortar stores mirrored a surge in Black Friday online shopping, which hit $7.4 billion, an all-time record for the day, according to Adobe Analytics.” There was some good news for brick-and-mortar stores. In-store sales on Thanksgiving Day were up 2.3 percent from a year ago.

Despite relatively strong retail sales, overall, major stock indices in the United States dipped on Friday for reasons unrelated to evolving business models in the retail industry. Indices trended lower for the same reason they have on numerous occasions this year: Investors were worried about a setback in U.S.-China trade talks. Barron’s explained:  “The Dow Jones Industrial Average, the S&P 500 index, and the Nasdaq Composite dipped on the final day of a boffo November. U.S. legislation supporting Hong Kong’s pro-democracy protesters, to which Beijing reacted furiously, dampened hopes that the highly anticipated phase-one trade deal with China would be inked soon.”

Despite losses on Friday, major U.S. indices were up for the week and the month, reported The Wall Street Journal. In November, U.S. stocks posted the strongest monthly performance since June.

U.S. government bonds have been delivering positive returns, too. Interest rates on 30-year Treasuries have fallen over the course of the year and were down again last week. When bond rates fall, bond prices move higher. When bond rates begin to move higher, prices will fall.

It’s remarkable when stock and bond markets move in the same direction at the same time. Often, strong performance in one market is accompanied by weaker performance in the other.

What makes a billionaire a billionaire?
During the five years through the end of 2018, the population of billionaires around the globe increased by 350 people to 2,101. The wealth of billionaires grew, too. After a 4.3 percent loss overall in 2018, billionaires’ wealth increased by 34.5 percent during the past five years.

 According to The Billionaire Effect, which was released by UBS and PWC last month, three specific personality traits explain the success of many billionaires. It seems the typical exceptionally rich person is a smart risk-taker, focused on business, and determined to succeed. If that describes someone you know who has not yet reached billionaire status, perhaps it’s the industry. The only field where billionaire wealth increased during 2018 was Technology.

Women are becoming billionaires at a faster rate than men (46 percent versus 39 percent during the past five years), although there are still significantly fewer women (233) among the superrich.

Most of these exceptionally wealthy folks are found in Asia and the Americas:

  • There are 754 billionaires in the Asia Pacific region with 436 in China.
  • There are 749 in the Americas with 652 in North America.
  • There are 598 in Emerging Markets, the Middle East, and Africa with 397 in Western Europe and 151 in Eastern Europe.

While personality traits may influence success, what really makes billionaires is the success of their companies. The report stated:  “Over the 15 years to the end of 2018, billionaire-controlled companies listed on the equity market returned 17.8 percent versus the 9.1 percent of the MSCI [All Country World Index (ACWI)], almost twice the annualized average performance of the market. Their companies are also more profitable, earning an average return on equity of 16.6 percent over the last 10 years, compared to the 11.3 percent of the MSCI ACWI.”

Weekly Focus – Think About It
“Human greatness does not lie in wealth or power, but in character and goodness. People are just people, and all people have faults and shortcomings, but all of us are born with a basic goodness.”
–Anne Frank, Diarist

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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A Bump in the Road?​

A Bump in the Road?​

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* This newsletter and commentary expressed should not be construed as investment advice.
* 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. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* 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.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* 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.davebarry.com/misccol/christmas.htm
https://www.cnbc.com/2019/11/30/black-friday-shopping-at-brick-and-mortar-stores-dropped-by-6percent.html
https://www.barrons.com/articles/the-next-best-stocks-to-buy-could-be-small-caps-51575071290?mod=hp_DAY_1 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-02-19_Barrons-The_Stock_Markets_Next_Breakout_Stars-Footnote_3.pdf)
https://www.wsj.com/articles/stocks-edge-down-ahead-of-start-to-u-s-shopping-season-11575023295 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-02-19_WSJ-US_Stocks_Notch_Best_Month_Since_June-Footnote_4.pdf)
https://www.marketwatch.com/investing/bond/tmubmusd30y?countrycode=bx&mod=md_bond_overview_quote (Choose 5-year and YTD time periods at top of chart)
https://www.investopedia.com/ask/answers/why-interest-rates-have-inverse-relationship-bond-prices/
https://www.cnbc.com/2019/06/26/in-a-rare-occurrence-both-stock-and-bonds-are-having-a-great-year.html
https://www.ubs.com/global/en/wealth-management/uhnw/billionaires-report.html (For the number of billionaires, click on ‘By year’ and choose 2014 and 2018. For the quote, click on download report and go to page 6) (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-02-19_UBS-Billionaires_Insights-Footnote_8.pdf)
https://www.brainyquote.com/quotes/anne_frank_752405?src=t_wealth

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