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So what is Dogecoin?

jim Financial advisor, Market Brief, Market Commentary, Market Review, Stock Market , , ,
dogecoin

In a week packed with important economic announcements, a late rally left major indices mixed. The S&P 500 and Dow Industrials scored new all-time highs, while the Nasdaq dipped. The famous question from the SNL skit, “so what is Dogecoin” is gaining plenty of attention, but remains unanswered? The Dow up 2.72%, S&P up 1.26%, and Nasdaq down 1.48% for the week.

Last Week

In a week packed with important economic announcements, a late rally left major indices mixed. The non-farm payrolls disappointed, with only 266,000 jobs created in April versus expectations of nearly 1 million. Increased government unemployment benefits continue. This contrasted with Wednesday’s ADP report which showed private sector payrolls advancing by 742,000 in April. The unemployment rate in April ticked up to 6.1%. In general, the labor market continues to improve, with last week’s new claims falling to a pandemic-era low of 498,000.

ISM Manufacturing and Non-Manufacturing Indexes, which are based on industry survey data, both came in lighter than expected for April. However, both indexes still signaled economic expansion. With economic activity picking up, but the jobs number sending mixed signals to the market,
policymakers are reluctant to change their conservative views of the recovery. Treasury Secretary Janet Yellen said the jobs report “underscores the long-haul climb back to recovery.” She retains her expectation of full employment returning in 2022.

Crypto currency dogecoin fell 25% intra-day Sunday following the Musk hosted SNL. But what is it? According to CNBC, in 2013, software engineers Billy Markus and Jackson Palmer launched the satirical cryptocurrency as a way to make fun of bitcoin and the many other cryptocurrencies boasting grand plans to take over the world.  “The joke is on Wall Street this time,” said Mati Greenspan, portfolio manager and founder of Quantum Economics. “What you have is a situation where teens on TikTok are outperforming even the smartest suits by thousands of percentage points.” Dogecoin hit an all-time high Friday afternoon. Dogecoin now has a market capitalization of about $92 billion following a six-month climb of more than 26,000 percent. Not much of a joke at the moment.

Week Ahead

Treasury Secretary Janet Yellen’s hawkish rate hike commentary briefly sent worry through risk markets before she walked them back. Fed members continued to deflect inflation concerns. There are several FOMC member speeches today and tomorrow. So we will see if they maintain a united front. U.S. retail sales are expected to come in strong again. This continues the strong results from last month, a nearly 10% jump. Crypto currency dogecoin has rebounded 5% intra-day on Monday.

Year-to-date index performance; Dow up 13.62%, S&P up 12.68%, and Nasdaq up 6.70% through the close on Friday.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

Erie CO Financial Advisor with a focus on investments, wealth management, and retirement planning in Boulder, Louisville, Niwot, Lafayette, Windsor, Berthoud, CO

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

Financial Review – Why now is still a good time

jim Financial advisor, Financial Review, investment strategy, Retirement Planning, wealth management, wealth planning strategies , , , ,
financial review

Isn’t it funny how quickly we adapt? Who would have thought that video conferencing would have become such an important part of life. And in fact a lifeline for many? It’s helped friends and families to keep in touch and enabled businesses to keep running during tough times. It’s certainly provided me with a helpful way of staying connected and providing financial review to clients.

Now, at the click of a button, I can invite you to a meeting from your home. I can make it interactive by sharing our screens to show you documents and charts. Of course, these meetings also save time because we’re not having to travel to see each other. Not to mention servicing clients in different states.

But the ‘Zoom revolution’ has also brought with it a new phenomenon. The phrase ‘Zoom fatigue’ describes the feeling of drain after too many virtual meetings. Psychologists explain that the added pressure of being seen on screen is what adds to this feeling of exhaustion. The strain of having to actively show through a small screen that we’re interested and alert can be tiring.

It’s certainly true that face-to-face meetings are much more relaxed. It’s an altogether more natural experience. There’s an emotional connection that happens without thinking about it. It’s easier to sense when someone needs to pause and reflect, and there are more comfortable silences. There’s also less chance of us talking over one another.

That’s why I’ll always advocate face-to-face interaction – and why I’m looking forward to seeing you again one day soon hopefully! But in the meantime, I want you to feel confident that your review meetings and catch ups – whether on the phone or via video – will still be just as effective as in person.

I understand what an uncertain and worrying time it will be for many and that now more than ever you’ll want to talk to someone in a relaxed a way as possible.

As part of your financial review, I’ll listen to your concerns and provide you with feedback and solutions based on your individual needs and priorities. I’ll also make every effort to make things clear and simple.

Last week wrapped up Financial Literacy Month. I hope you were able to learn a few new things and apply them to your strategy. One of my goals in sharing information is to engage you with useful content so you are in the best position to grow your wealth – and maybe even have a little fun. Ask yourself these three questions to reveal how financially literate you are:

  1. Are you in control of your spending? Examining your money habits and creating a budget puts you in the driver’s seat toward smart money management.
  2. Are you saving for your future? Do you live within your means and are you investing in yourself first and foremost? If you need more info about how to best do this, ask me.
  3. Are you confident in reaching your current financial goals? Listen to your gut, and act accordingly.

If you answered yes to all three of these questions, you’re in good shape. But if you said no, don’t worry. Many people have had to reevaluate their priorities over the past year. I can help get you on the right track. I’ll also invite you to participate comfortably in the conversation and ask me any number of questions – I really mean it when I say there’s no such thing as a silly question!

I hope this provides reassurance that now is still a good time for a financial review. By re-setting your financial strategy at this point, I can put recent market performance and your longer-term financial goals into context. It will also give you the chance to pause, reflect and resettle your mind.

I look forward to speaking to you.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

Proposed Capital Gains Tax Rate Increase and Your Money

jim Financial advisor, Market Brief, Market Commentary, Market Outlook, Stock Market , , , , ,
captial gains

Stocks ended mostly flat on the week, with an abrupt tremor on Thursday after President Biden proposed a sharp increase in the capital gains tax rate. Housing market and job reports remain strong. The Nasdaq-100 sits just below all-time highs. Indexes for the week; the Dow down 0.42%, S&P down 0.11%, and Nasdaq down 0.25%.

Last Week

Government stimulus, monetary policy, and vaccinations have led indexes to reach near all time highs. President Biden’s proposal to increase capital gains tax rates to 39.6%, led to a severe drop on Thursday afternoon. The markets quickly recovered on Friday. Housing data continued to grab headlines, with the median selling price for existing U.S. homes up 17.2% year-over-year to $329,100 in March. Existing home sales actually dropped 3.7% last month due to supply being so limited, while new home sales in March increased 20.7% month-over-month and 66.8% year-over-year. The average sales price of new homes also increased 6% from the prior year. Jobless claims fell to a pandemic era low of 547,000. This is the lowest weekly level since March 2020.

Week Ahead

The Federal Reserve likely will not be changing monetary policy at Wednesday’s meeting. However, with economic data improving and inflation perhaps moving towards 4%, investors will be listening closely for clues about a shift in strategy. On Thursday, we will get our first look at Q1 GDP, with strong growth of 6.6% expected. The other main event this week is a slew of earnings reports. This includes a third of S&P500 companies and many of the important names in the Nasdaq, such as Apple, Amazon, Facebook, Microsoft, and Google.

The week will close out with U.S. pending home sales and several GDP reports from Europe and Canada. Before getting up in arms regarding the increased capital gains tax, consider this news was a reaction to the proposal. Also, this proposal only impacts individuals earning more than $1m. Year-to-date index performance; Dow up 11.23%, S&P up 11.29%, and Nasdaq up 8.76% through the close on Friday.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

Erie, CO financial advisor with a focus on investments, wealth management, and retirement planning in Boulder, Louisville, Niwot, Lafayette, Windsor, Berthoud, CO.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

Impact of Upcoming Earnings and Economic Data

jim Economy, Financial advisor, Market Brief, Market Commentary, Market Outlook, Market Review, Stock Market , , , , ,
earnings and economic data

Last week, investors’ expanding risk propelled U.S. equity indices 1-3% higher, driven by large-cap technology bursting out of consolidations. The Nasdaq paced the advance, while the S&P 500 scored its 22nd record high of the year. The S&P 500 roared past the 4000 level returning over 2.75%. The index is on its longest weekly winning streak since October of last year.

The VIX, a measure of volatility, slid below 17 to its lowest level since before the pandemic. U.S. Treasury yields were flat as investors weighed better than expected producer inflation versus dovish commentary from Fed. Economic data impressed once again. Producer prices increased well ahead of expectations in March, rising 1% over the prior month. Year over year, producer prices increased 4.2%, which was the largest yearly increase since 2011.

Continued claims, or the number of people receiving unemployment benefits, continued to slowly improve, falling to a one-year low of 3.73 million in the week ending on March 27. That represents a significant improvement from the high of over 23 million reached in May 2020. Another sign housing is affected by the rise in yields, mortgage applications fell 20%.

Earnings and Economic Data Ahead

Earnings season has arrived, and so has critical economic data. The largest financial institutions like J.P. Morgan, Goldman Sachs, and Bank of America will report later in the week. Also this week, investors will weigh the latest consumer inflation data on Tuesday and retail sales on Thursday. Fed chair Powell has repeatedly stated the FOMC believes rising price pressures will only be transitory and the labor market still has significant slack. Thereby they are nowhere close to removing support or changing their dovish stance. Thursday offers plenty of market-moving potential with U.S. retail sales. Retail sales are expected to rebound sharply, as well as weekly unemployment claims. Lastly, Friday’s building permits and housing data will be closely watched. The key is whether the recent weakness tied to rising yields continues to filter through the sector.

Year-to-date index performance; Dow up 10.9%, S&P up 9.9%, and Nasdaq up 7.8% through the close on Friday.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

Financial Adviser in Erie, CO with a focus on investments, wealth management, and retirement planning in Boulder, Louisville, Niwot, Lafayette, Windsor, Berthoud, CO

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

Ripple Effect of the Blocked Suez Canal

jim Economy, Financial advisor, Market Brief, Market Commentary, Market Outlook, Market Review, Stock Market , , , , , , ,
suez

Despite the Suez Canal blockage, disrupting global trade, U.S. equity indices fluctuated between gains and losses throughout a volatile week. Month- and quarter-end flows hang over the market, but J.P. Morgan’s head quant expects flows to be net positive for equities, opposite of consensus. Also, the monthly jobs report is Friday.

Last Week

U.S. equity indices fluctuated between gains and losses throughout a volatile week but surged in the final hour of Friday’s trade. The Treasury yield rally consolidated amid technical headwinds and dovish Fed comments. The re-opening trade took a deep breath but is still +35% since the November 9 Pfizer vaccine announcement. The Nasdaq Composite failed to finish higher, but it did close notably off the lows. Energy dropped precipitously early on but sharply retraced losses after a cargo ship completely blocked passage in the Suez Canal.

Fed Chair Powell’s testimony reiterated the FOMC’s belief that inflationary pressures would only be temporary. Treasury yields began the week dropping significantly on Monday and Tuesday, as Fed Chairman Powell confirmed the Fed’s commitment to loose monetary policy. He insisted that the he does not believe a surge in inflation this year will be persistent or large. Powell believes that the Federal Reserve has the tools necessary to deal with higher inflation.

Existing home sales fell 6% in February, and new home sales dropped 18% Month-over-Month. However, new home sales are up +8.2% Year-over-Year. Durable goods orders fell for the first time in 10 months. Services activity came in at an 80-month high, supported by the steepest increase in new business in 3 years. Backlogs increased though, while prices surged on unprecedented supply chain disruptions. European PMIs came in much better than expected as well, returning to manufacturing growth for the first time in 6-months. The services sector remains in contraction, hampered by the COVID-19 related lockdowns.

Week Ahead

Month- and quarter-end flows hang over the market this week. The shortened holiday week features a docket full of Tier 1 economic data. Revisiting Friday’s bewildering market movement is critical. Shares of some media and technology companies were cut down significantly. Weekend reports tie this to an over-levered fund’s liquidation. The technology-heavy Nasdaq’s ability to rally sharply in the face of higher yields seems notable too. As the calendar turns, April offers investors a potential seasonal tailwind. Historically, it’s been the strongest month for the S&P500, higher 74% of the time since 1964 by an average +1.7%. Rebalancing could create a few speedbumps though.

Over the last 3 months, 10-year yields have risen 74 basis points, while the major U.S. equity indices have climbed modestly. The S&P 500 and Nasdaq Composite are +5.82% and +1.92% respectively, but equal weight S&P500 is +11.52% as the median stock has performed better than the market-cap behemoths. The monthly jobs report is on Friday, but markets will be closed in observance of Good Friday. Next Sunday’s futures opening could be chaotic as global investors react to our labor market situation, but they also may place more weight on the ADP report mid-week. Both are expected to show solid job creation, but the Fed remains focused on the slack in the labor sector, which is illustrated through the underemployment rate. Tuesday’s consumer confidence is poised to jump sharply given the stimulus deployment and vaccine progress.

Year-to-date index performance; Dow up 8.06%, S&P up 5.82%, and Nasdaq up 1.94% through the close on Friday.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.