“It ain’t over ‘til it’s over.” Words of wisdom from baseball legend Yogi Berra. And words that Fed Chair Jerome Powell has taken to heart.

“Inflation has eased over the past year but remains elevated,” Powell said following the Fed’s June meeting. In other words, “it ain’t over ‘til it’s over.” The Fed wants to see more progress toward the Committee’s 2 percent inflation objective before considering any changes to monetary policy.

Recall that just a few months ago, the Fed seemed prepared to cut rates three times in 2024. However, an uptick in inflation in Q1 forced them to revise their outlook. At the June meeting, Fed officials anticipate cutting short-term interest rates just once this year.1,2

The Fed’s about-face serves as a good lesson for everyone.

Changes in your goals, time horizon, and risk tolerance should drive portfolio adjustments rather than forecasts and best guesses. The economy changes. Markets shift. And the Federal Reserve will adjust its strategy in response to what’s happening.

When I say “staying the course” and don’t overreact, it’s because I’ve experienced several economic cycles that take longer than expected to resolve. I’ve also seen others take shorter than expected to conclude. So today, I ask myself, “Is the Fed going to stick to its one-cut strategy or update its approach at the next meeting?” Recent history would suggest it’s about a 50/50 chance!

Our strategy isn’t dependent on anything the Fed does–or doesn’t do. Let’s stay the course and remember, “It ain’t over ‘til it’s over.”

“Are you aware the registration on your car has expired?”

You've experienced one of the costs of procrastination.

Procrastination is avoiding a task that needs to be done—postponing until tomorrow what could be done today. Procrastinators can sabotage themselves. They often put obstacles in their own path. They may choose paths that hurt their performance.

Though Mark Twain famously quipped, “Never put off until tomorrow what you can do the day after tomorrow,” we know that procrastination can be detrimental, both in our personal and professional lives. Problems with procrastination in the business world have led to a sizable industry in books, articles, workshops, videos, and other products created to deal with the issue. There are a number of theories about why people procrastinate, but whatever the psychology behind it, procrastination may cost money—particularly when investments and financial decisions are put off.

As the illustration below shows, putting off investing may put off potential returns.

If you have been meaning to get around to addressing some part of your financial future, maybe it's time to develop a strategy. Don't let procrastination keep you from pursuing your financial goals. This also applies to college funds for kids and grandchildren too. The sooner you start, the more time for compound growth of investment accounts.

Let's look at the case of Cindy and Charlie, who each invest $100,000.

Charlie immediately begins depositing $10,000 a year in an account that earns a 6% rate of return. Then, after 10 years, he stops making deposits.

Cindy waits 10 years before getting started. She then starts to invest $10,000 a year for 10 years into an account that also earns a 6% rate of return.

Cindy and Charlie have both invested the same $100,000. However, Charlie's balance is higher at the end of 20 years because his account has more time for the investment returns to compound.

This is a hypothetical example of mathematical compounding. It’s used for comparison purposes only and is not intended to represent the past or future performance of any investment. Taxes and investment costs were not considered in this example. The results are not a guarantee of performance or specific investment advice. The rate of return on investments will vary over time, particularly for long-term investments. Investments that offer the potential for high returns also carry a high degree of risk. Actual returns will fluctuate. The type of strategies illustrated may not be suitable for everyone.

We closed out the QQQ (NASDAQ 100 ETF) long/short positions yesterday.  This morning we just sold RSP, ROBO and UBOT due to weakness in their respective sectors.  We are still holding the S&P-500 long/short combo to neutralize our models and to not incur capital gains on recent profits.  If you have any prospects, friends, relatives, etc., that are 100% long in a "pie chart" investing style, you really need to get their attention now. 

Yesterday, I spoke with a client who gave me part of her money as a test on August 18, 2022.  She is +2.90% through yesterday.  She left $815,000 with her father’s advisor. It is now worth $650,000.  People are listening to the talking heads on investment shows and the Jim Cramer crowd.  It is so sad.  Yesterday, a talking head on CNBC Power Lunch spent time ranting and raving about how the 60/40 investment model blend is alive and well.  In all my time listening to CNBC and reading over 4 hours a day, I have never heard or read one word about the AGG (The benchmark for bonds) being -15% last year.  Nowhere, no one, is talking or writing about it.  Then again, probably over 90% of licensed advisors don’t know what the AGG is.  

BTW, most of you may have already heard or read about this, but it's important enough to mention again. As a barometer of how bad the financial climate was in 2022, there are only two times in the last 100 years of stock market history when both the S&P-500 AND the AGG were both double digit negative at the same time: 1932 (Great Depression) and 2022! There was no safety in either equities or bond/fixed income portfolios.  Noodle on that!

Read more on pie charts  

Call me, having fun, this is what we do best!!

Jack
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