Market Alert November 21st, 2018: Happy Thanksgiving from all of us at Money Matters!
As a firm that specializes in retirement planning, our two goals for you are:
- For you to have Financial Peace of Mind and
- For Your Money to Last As Long As You Do.
Our investment philosophy of Buy, Hold, and SELL! is designed to give us Unlimited Upside with a Tolerable Downside.
- Happy Thanksgiving!
- Higher Interest Rates Could Bring Down the World Economy.
- If This Is the Beginning of the Next Market Crisis, Are You Prepared?
If you are not a client of Money Matters, we would like to visit with you! Let us worry about all this so that you don’t have to.
- Do you know if you have enough money to retire?
- Do you have a plan for what to do when the next market crash comes?
- What are 5 strategies that you can use to reduce your income taxes?
- How do you plan for your retirement cash flow?
- What should you do to maximize your Social Security benefits?
- Are you diversified the way you should be?
We would love to review your retirement plan with you and see if we can help you. If we can help you, that’s terrific, if not that’s fine too. Either way, there is no charge or obligation, and we will part friends!
We hope that this email finds you in the best of health and that you are enjoying your Thanksgiving weekend. Despite everything that is going on in the world today, we still have so much to be thankful for.
Higher Interest Rates Could Bring Down the World Economy.
Over the last decade, countries around the world have taken on an unprecedented amount of debt. Much of that debt is denominated in U.S. dollars.
With interest rates so low, borrowing dollars has been almost a no-brainer. Countries have been borrowing dollars at very low-interest rates. They have put these dollars into their economy or turned around and lent them to others.
With the strengthening of the U.S. economy, we have also seen a strengthening of the U.S. dollar. Debt that is denominated in U.S. dollars has become more expensive because the dollar has gone up. This debt around the world that is denominated in dollars has to be repaid, but it has become much more expensive.
Also, the Federal Reserve has raised interest rates. In many cases, this debt has become more expensive to service at these higher rates.
The result is that the cost of paying the debt back has gone up and the cost of servicing the debt has gone up. This is a great worry to us because we can see emerging countries defaulting on their debt. We believe that if that happens, it could start a domino effect of defaults around the world that could cause the next global market crisis.
The Federal Reserve has said that they plan to continue to raise interest rates over the next year. We are very concerned that the effect of these higher interest rates on the global economy may be underestimated, and the Federal Reserve could inadvertently create a global financial crisis.
If This Is the Beginning of the Next Market Crisis, Are You Prepared?
We are thankful that we have a sell strategy. Without it, we would find it very difficult to justify investing in the stock market at this time. We believe there is still upside, but we also believe that when the downside comes, it could be very bad.
Our strategy enables us to participate in the upside as long as it lasts; it is also designed to get us out with tolerable losses when the trend changes.
And we all know that the trend can change quickly and precipitously.
Look at the chart below:
I would like to invite you to come to one of our seminars. They are designed for those of you who are retired or retiring soon, and they are free.
At the free retirement seminar, we will answer these burning questions:
- How do I protect my retirement from the next market crash?
- How do I avoid three basic “pitfalls” of retirement distribution planning?
- Am I on track to be able to retire?
- When should I take Social Security? 62? 66? 70?
- Am I diversified the way I should be?
- How much can I afford to spend during my retirement?
- How can I fight inflation?
- How do I determine how much risk is appropriate for me?
- Do I take my pension or a lump?
- How do I avoid having 85% of my social security taxed?
- Should I rollover my 401(k)?
- How do I reduce my income taxes in the future?
- The Biggest Risk We See To The Global Economy: The Fed
- 18 Risks Faced In Retirement #12: Forced Retirement
- Social Security Question: Keep Working After 66
- Thankful for Buy, Hold, And Sell
- Estate Tip: The Most Important Inheritance Of All
It is our singular goal to have our clients enjoy their retirement, which we call “your second childhood without parental supervision.”
Whatever that second childhood means to you, we want you to enjoy it with financial peace of mind. For us, peace of mind means having a strategy that is designed to give us unlimited upside with a tolerable downside.
Perhaps you were given a package by your employer. Perhaps you sold an asset and want to know how to properly invest the proceeds. Perhaps you inherited money and want to keep it safe and grow it if you can. Perhaps you just want a second opinion. These are all reasons for you to take advantage of all the resources that we at Money Matters have to offer you.
We want to help you achieve your retirement goals.
Thank you for subscribing to this newsletter. I hope it finds you and yours in good health and spirits.
Ken Moraif, CFP®, MBA