Articles & perspectives

The Next Major Market Downturn’s ETA – One Year From Now

The Next Major Market Downturn’s ETA – One Year From Now

      As we step into the final growth stage of our economic cycle, which has been one of the longest in modern history now in its ninth year, the yield curve once again seems to have a high likelihood of predicting the next market peak and crash.  The trajectory of the yield curve, along with a few other contributing factors discussed below, suggests a market top and subsequent crash will take place exactly one year from now. Currently, the US is expected to surpass 3% GDP growth in Q2 2018, according to the AtlantaFed GDP Now, and economic conditions are extremely strong, better than we have had for over a decade.  Even so, headwinds are mounting and the tailwinds are waning.  At the moment, we are benefiting from lower taxes, the increased spending

With rates on the rise, now is the time to invest in…

With rates on the rise, now is the time to invest in… Current Yield = 6.00% Approximate NAV = $25 Minimum Purchase Amount = $2,500* Custodian: TD Institutional Share Class Purchased Through Blue Pacific Wealth Management = I Shares (Institutional Shares) Are you tired of taking on increasing interest rate and credit risk while only getting a mere 2% – 4% yield in fixed-income?  Are you invested in individual bonds, bond mutual funds or bond index funds that have a high risk and low return potential?  If you are currently invested in traditional corporate or high-yield mutual funds or index funds, you are currently being confronted with multiple headwinds, including rising rates and rich valuations due to the Fed’s multiple stimulus programs since 2009 that have expanded credit.  What’s more, it is likely we are entering the

Benefits & Types of Alternative Investments

  The Main Benefits of Alternative Investments Include: Income – An investment strategy that seeks to provide a steady stream of current income, or yield, over time. Investors have varying needs for dependable current income, whether to meet monthly expenses or achieve long-term financial goals. Especially during periods of low interest rates, some alternatives may offer higher yields than traditional investments. Diversification – A risk management technique that mixes a wide variety of investments within a portfolio. A diversified investment portfolio that includes stocks, bonds and alternatives can help smooth the impact of market volatility and may generate higher returns relative to their levels of risk over time. Many alternative investments tend to have lower correlations to traditional investments. As a result, they can potentially reduce overall portfolio volatility and help mitigate extreme swings in investor sentiment

Bryan’s Market Update – April 10th 2018: Volatility Resurfaced, But Markets Maintain A Long-term Upward Trend

April 10th, 2018 In this issue!  –  Market Update –  Current Investment Considerations –  Forecasting The Next Recession –  Featured Charts –  Featured Alternative Institutional Investment Offerings –  Proprietary Asset Class Rankings for US & Global Markets Interested in setting up a meeting?  I’d love to connect.  Here’s my calendar link to schedule a time.   Markets have had a wild ride so far this year.  In my last letter after the new year, I mentioned markets would have a spike in volatility.  We have seen this increase in volatility coinciding with two sharp drawdowns in just the first three months of the year with subsequent recoveries.  After remaining below 14 on the VIX (Volatility Index) for most of 2017, the VIX spiked to 50 in February and maintained an elevated level over 16 so far for most of

10 popular stocks that would be hit hard if Trump started a trade war

Apple, Caterpillar and Wynn Resorts are businesses that could be especially hurt if other countries or trade blocs retaliate. President Trump’s discussion on tariffs has the capacity to initiate a trade war. Surely there’ll be plenty of commotion, as is customary with Trump, and in our investigation, the likelihood of a trade war with dire consequences isn’t large. Nonetheless, it’s only prudent to take preventative actions. Let’s explore using a graph, I shall share the titles of 10 popular stocks which would be in danger if there’s a trade warfare. Read:Here is why the stock exchange is accepting the Trump tariffs so challenging (http://www.marketwatch.com/story/heres-why-the-stock-market-took-the-trump-tariff-announcement-so-hard-2018-03-01) Chart Click here here (https://thearorareport.com/chart-stock-market-trump-trade-war-03022018) to your annotated chart of S&P 500 ETF (SPY). Similar conclusions could be drawn from the graphs of Dow Jones Industrial Average , DJIA ETF (DIA) and

Frequently Asked Retirement Income Questions

When should I start considering tapping my retirement resources and how should I go about doing this? The response to this question is dependent upon if you expect to retire. A set of meetings with a financial adviser might assist you in making important decisions like how your portfolio ought to be spent, once you’re able to afford to retire, and just how much you’ll have the ability to draw yearly for living expenses. Should you expect retiring before, or appreciating a longer working life, you might have to change your preparation threshold so. How much yearly income am I going to need? While studies suggest that a lot of men and women are very likely to need between 60 percent and 80 percent of the final operating year’s earnings to keep their lifestyle after

Impact Of The New Tax Law On Financial Planning And Retirement in 2018

Those working in retirement as sole-proprietors or LLCs can deduct 20% of their business income but their full income will count against the Medicare PartB premium threshold. The new year provides a package of changes to federal income tax laws which go into effect. Here are the salient changes which impact financial planning and retirement. Unless you’ve been consumed in of the bowl games, you’re likely aware there are no longer $ 4,050 exemptions to your partner, you and your kids, although the deduction has approximately doubled to $ 24,000 for joint filers. There is a2,000 per child tax credit with a at $400k AGI, and the era deductions still apply. If you’ve been itemizing and live in a high tax state, property tax deduction and your joint state income is capped at $10,000. The

Trump Tax Plan – Key Points

Trump Tax Plan – 8 Key Income Tax Provisions: 1) It eliminates personal exemptions which could result in families with many children paying higher taxes 2) It eliminates most itemized deductions such as moving expenses, alimony payments, etc. 3) It limits the deduction on mortgage interest to the first $750K of the loan and interest on home equity line of credits can no longer be deducted 4) Taxpayers can deduct up to $10K in state and local taxes.   They must choose between property taxes, and income or sales taxes. 5)  It expands the deduction for medical expenses 6)  It repeals Obamacare tax on those without health insurance in 2019 7) it doubles the estate tax exemption from 11.2 million to 22.4 million and  it keeps the alternative minimum tax but increases the exemption 8) it

Life Happens. Here’s What To Do With Your Finances If You Divorce.

Getting divorced checklist Managing the financial aspects of a divorce might be as dealing with the feelings as essential. Transactions and accounts that are financial Split all bank accounts balances as called for in the divorce arrangement Cancel concerted checking, savings and revolving credit accounts, including credit cards Establish personal accounts in your name for ATMs, checkingaccount, savings and credit cards Permit your utility businesses know if you are assuming responsibility for the invoices or if your title ought to be removed in the accounts. Be certain that you upgrade the account for heating , electrical, gas, sewer, water, cable/satellite tv, phone and Internet. Responsibilities for any co-op or condominium fees. Convert household programs to individual contracts, if appropriate Notify all your creditors of your varied conditions and duties, such as change of address if

Predictions for 2018

2017 was a good year for the buy-and-hold investor where broad-based gains were captured across all major US & global equity markets. In addition, volatility hit historically low levels, which was a far step away from the past several years where investors have been bombarded with above-average volatility. As we enter 2018, practically all major US and global economic indicators are positive and no signs of recession exist in the near future. The good news is that the US & global economies are expanding, the bad news is that all this positive news is already priced into the markets. Therefore, 2018 will likely experience higher volatility than 2017 with one or two corrections possibly up to 15%. However, I do believe we will likely end the year higher in the US markets and especially emerging
US Dollar & Small Caps Could Surge With Tax Reform Being Passed

US Dollar & Small Caps Could Surge With Tax Reform Being Passed

US Dollar has been flatlined for 3 years and steadily declining throughout 2017. The House has currently passed their version of a reform bill and the Senate Finance Committee passed its bill on to the full Senate for a likely vote this week. Indications are that the Senate will pass its bill, triggering the reconciliation process between the two Houses of Congress.  It is expected that this process will be difficult, but many experts believe a compromise bill will be passed during the first quarter of 2018. If so, this may thrust the US Dollar above its 12-month resistance and head higher.       In addition, the passing the Tax Reform bill may also push small caps higher, especially if the US Dollar appreciates.  Coincidentally, small-caps just broke above their 10-year rising resistance level,
Construction and Industrial Loans Falling w/ Rates Rising

Construction and Industrial Loans Falling w/ Rates Rising

While leading economic indicators are strong… Commercial and Industrial Loans are lagging….. Over the past few decades, Fed Funds Rate has had a direct correlated with Commercial and Industrial Loans.  For example, when loans are weak, the Fed Funds declined, which helped borrowers.  However, this cycle we see loan declines with rates RISING with expected continued increases in the Fed Funds Rate (see below).   Continued divergence in this critical area could be the weak link for a continued robust bull market.
Fed’s Balance Sheet is Maturing – AND FAST!

Fed’s Balance Sheet is Maturing – AND FAST!

Below is a chart showing the Fed’s Treasury holdings within its balance sheet. Almost 50% of the Treasury holdings matures between now and 2020, with 2018 the year with the most maturities. The way the fed handles their current assets will shape the financial markets now and for years to come. If they sell the Treasuries too quickly or prematurely, the bonds will crater along with an unexpected surge in rates. If they don’t sell the bonds, US debt will skyrocket at a faster pace. The Fed certainly has our attention. Simply put, they are screwed either way, its just a matter of when they want to be blamed for the problems they cause: now or later. Fed’s Balance Sheet: Notice as the bank assets rose, so did the stock market. Now that the Fed
Yield Spread Update

Yield Spread Update

We are similar in the spread cycle as 2004 – 2005. However, the current cycle has been manipulated due to Quantative Easing programs or central bank intervention that artificially distorted yield curve from 2008 – 2016, indicating this cycle may evolve differently from the past cycles.
Monthly Economic Newsletter & Investment Insights

Monthly Economic Newsletter & Investment Insights

Much has been made of President Trump’s expectation to implement his pro-growth agenda, which certainly contributed to the run-up in equities starting immediately after the election.  However, recent market strength seems to result more from positive corporate earnings than anything else, which, on balance, is a more essential driver of equity returns.  Furthermore, the Trump administration has yet to produce specifics about its tax goals while health care reform is taking much longer than anticipated.  At the same time, ongoing investigations into the White House are, at a minimum, creating serious distractions.  Investors still expect a tax bill, but the odds are diminishing of anything comprehensive being passed this year. Through the first quarter, U.S. companies grew at their fastest pace in nearly six years, extending the stock market rally that has stretched into its
Yield Spread Is Tightening – High Yield Bonds Are Overpriced

Yield Spread Is Tightening – High Yield Bonds Are Overpriced

The yield curve is showing rising short term rates, indidating a move to a risk-off sentiment where investors have reduced prospects for potential growth in equities. In addition, the High Yield Bond Spread is in consolidation, which is healthy, but it usually gets strained at these levels, especially since high yield bonds are trading at overly optimistic valuations. />