Pure’s Executive Vice President & Chief Investment Officer, Brian Perry, CFP®, CFA, AIF®, and Senior Investment Strategist & Financial Advisor, Brian Fahey, CFA, provide updates on the economy and financial markets, as well as insight into what the second half of the year might hold.
Outline
- 00:00 Intro
- 00:37 Tariffs and Taxes
- 3:02 Why are Markets more worried about tariffs? What’re the positives?
- 4:53 Who’s paying tariffs?
- 11:24 What About the Tax Bill?
- 15:50 Labor Market: Remaining Resilient
- 24:44 Q&A
- What current economic conditions are impacting financial planning and how is Pure Financial Advisors adjusting planning for the conditions?
- Where does the tariff money go?
- Can you please explain how this is not inflationary? How does this not cause high interest rates?
- Do you have an outlook on oil and gas prices in the near future?
- Any thoughts about AI and its potential to impact the labor market?
- 36:47 Stock and bonds
- 53:37 Q&A
- The President wants Powell and the Feds to cut the interest rates, but we are saying that the economy is doing well. So, do you have any thoughts about this?
- Any comments about bitcoin, gold or other precious metals in financial portfolio.
Transcription:
(NOTE: Transcriptions are an approximation and may not be entirely correct)
Kathryn Bowie: Welcome to this Market Outlook webinar. We have Brian Fahey, who’s our senior investment strategist, and Brian Perry, who’s our Executive Vice President and Chief Investment Officer here at Pure Financial Advisors. Well, we thank you for being here. We’re gonna, I know you got a lot to talk about, so I’m gonna let the two Brians jump in.
Brian Perry: Let’s dive on in, Brian, and what I wanna do is I’m, we’re gonna share some slides as always, and we wanna start with some of the things that are on people’s mind, beginning with, tariffs. And so as we look at tariffs and taxes, two of the things that are topical, maybe just start and let us know what, where are we at with this? What’s gonna happen here with some of the tariffs?
Brian Fahey: Yeah. So tariffs are still in the headlines. over the weekend we had. The announcement of a framework for a deal, with let’s the EU and Japan. So it does look like we’re probably gonna be settling in for a tariff rate of about 15%. So not as bad as what the market was fearing, on April 2nd, but still about eight times higher than where we were in terms of terrorists at the beginning of the year. Just some context on that. 15% terrorist works out to be about 500 billion worth of. Tax revenue to the Treasury, that works out to be about 1.7% of us, GDP. So it’s a real number. but it’s certainly not as bad as what investors in the market was thinking, on April 2nd. So I guess one of the interesting things that probably surprised all of us is how well the market has done post.
Tariff announcements. I think part of it is there’s still a lot of uncertainty and the tariffs are biting slowly. So it’s not like we all woke up one day and all of a sudden every imported good is 25% more expensive. It’s kind of slowly working its way through the supply chain, so it’s not just a big hit to consumers right away.
And I think that is given consumers a little bit more optimism that this tariffs part’s not gonna be as impactful as initially feared. But we’re still looking at the biggest change to the global trading system since the 1930s. So honestly, it is pretty impressive that sentiment has shifted from, you know, very dour pessimism on April 2nd, third to, you know, all time highs, starting a couple of weeks ago.
BP: So that, that prompts me to ask my favorite question. Why? The toddler question. Why? And, you know, in this case, I think we all do wanna know why and if tariffs are viewed by most economists and a lot of market participants as this terrible thing. And these are the highest we’ve had since the 1930s.
And yeah, we saw a surge of volatility for a while, but you know, now, we’re at, to your point, all-time highs in stock markets, despite tariffs that are the highest we’ve had since 1930. Higher prices potentially for consumers. I guess a twofold question to dive under the hood a little bit. One is, why aren’t markets more worried? And two, and in conjunction with that, is why are we doing this? What’s the good part of that? Because a lot of people talk about the negatives of tariffs, but there has to be some sort of positive, or we want to be doing this, right?
BF: Yeah. I mean, let, me answer the first part or the second part of the question first. The idea is if we’re importing fewer goods from overseas, then we’re going to make those goods domestically. And if we’re making them domestically, that’s potentially a job for somebody here, right? So the idea is instead of buying stuff from overseas, we’ll make it here. And that’s gonna employ Americans.
That’s going to stimulate the economy. It’s gonna create more investment opportunities, and that will snowball into more economic growth. That’s kind of the argument and the hope. The re so that’s why we’re doing it in theory. the reason why it hasn’t been as impactful is maybe we all feared is honestly, there’s probably a bit of institutional angst in the analyst and the economists area where people just have been working in the same direction for lower tariffs since the end of World War II.
And it’s just not the way economists and analysts think about the world. The world should be free-flowing capital, free-flowing people. You know, that kind of open border argument that’s been around since the end of World War II and moving against that is the opposite of what everybody’s been taught in school and what they’ve been working for.
And the idea is if you, the fear was if you started moving away from that, then supply chains would get gummed up. Inflation would spike. There’s just a lot of things that economists, analysts feared would happen if we’re changing the direction of global trade, or at least throwing sand in the gears of it.
So far, the impact has been pretty modest. We have another slide we’ll talk about in a second, but the areas that are being hit the hardest are probably more in line of autos, probably a little bit more with, like hard goods on here. We have inflation rate for home furnishings and appliances.
That’s really the first place that we’re starting to see inflation, which is probably the most clear negative impact of tariffs. but is that gonna be super impactful? It’s a three-and-a-half percent weight of the headline CPI and the inflation number. It’s not gonna really move the market. But next time you have to go buy a new dishwasher or washing machine, it’s gonna be more expensive.
You’re gonna notice it. But you know, that’s maybe what purchase you make once every, I don’t know, five, seven years or so. So is it gonna be annoying? Absolutely. Is it gonna change your life? No. It’s just gonna be you’re paying, you know, an extra 5,000 bucks for a washing machine or dishwasher that you know, didn’t really anticipate.
BP: So, is there an element here of if the idea is that we’re gonna bring jobs. Back to our shores. but we’re all gonna pay a little bit more for some of this stuff that the, it’s essentially everybody suffers a little bit of pain so that certain people can do disproportionately well. and by that I mean, you know, maybe we all pay a few dollars more or whatever for something that we’re buying and hopefully that’s not too painful. But the flip side is that there are people that maybe didn’t have a job that get a job making this stuff or that had a lower wage job that now make a lot more money. And so the aggregate that the benefit to those people outweighs a little bit of, pain to, consumers. Is that –
BF: Yeah, exactly. That’s the hope. The hope is that somebody with those waiting tables today will have a manufacturing job. At some point in the future, and that manufacturing job hopefully has its higher salary, steady hours, benefits, you know, all those things that, that come along with a solid blue collar job that you don’t necessarily get with, you know, service related jobs, like cleaning hotel rooms or, you know, waiting tables or something along those lines.
BP: Okay. And how realistic is that? I mean, I know that’s tough to- the $10 trillion question or whatever, number one you put on it is, how does this all work out? But, you know, in a lot of ways we’re in, that’s almost like trying to shift back to an industrialized economy, and in a lot of ways, we’re post-industrial or knowledge-based or whatever. Is it realistic? Do you think that we can bring manufacturing back in America and actually make things in the US of A.
BF: I mean, in scale? Probably not just because. China and a lot of the con countries that have really in-depth supply chains have been building those supply chains for 20, 30, 40 years and have all the infrastructure to make that happen. It would take us forever to build that up. So maybe in 40 years that’s more of an answer. But in the short term, essentially what tariffs are doing is making areas of the economy in the US that were less competitive relative to foreign competition. More competitive. So there’s areas that. Without tariffs, potentially wouldn’t have job growth. That with tariffs, might have job growth. How’s that gonna play out? You know, nobody knows, but in aggregate it’s probably not gonna be a huge hit to the economy. You know, it would probably be a little bit slower retail sales growth because you’re paying higher prices, right?
So you can’t buy as many things. and there’s gonna be some areas of the economy that. Without tariffs wouldn’t grow or wouldn’t grow as much, and with tariffs will, and then other areas that are really competitive, that might not grow as much because it’s harder to sell US products overseas. so hopefully it balances out with a little bit more growth and than what we’ve experienced without tariffs, but the jury’s absolutely out and we won’t have an answer for that, question for a long time, and it’ll probably be pretty darn hard to measure as well.
BP: Yeah, I mean, and you know, I guess just a couple things that pop in my head as we talk about this is, one, is that. And we could have a pretty robust debate on the merits of free trade versus tariffs versus not free trade. but the reality is that trade has never been free. and even in this globalized society we’ve lived in for the, you know, since World War II, if not longer, there, there have been tariffs around and there have been trade policies, you know, that every country has used some more than others and.
You know, there are very logical arguments and reams of data that show that in some ways other countries have been supporting their industries, maybe more than the United States and that maybe that has hurt the us. And so there, there certainly is a logic, to what we’re doing here. And I guess to your point, it’s gonna take a really long time to see if it works, but to the degree that stock markets are a sort of forecasting or forward-looking measure. You know, it’s telling you at this point that they think it’ll be okay, which is interesting and hopefully that is the outcome. the one other thought that comes to mind is you mentioned supply chains several times. And, just for those out there, supply chain essentially means the whole sequence of how things are made.
So you know, if it’s a car and the iron is coming from one country and the rubber for the tires from another, and then the door is being manufactured in Canada and then the electronics in wherever, Japan, and then maybe the car’s being put together in Kentucky or whatever it is. That’s the supply chain and the more of those pieces you have to bring back to the United States, obviously that’s pretty impactful for companies as well as the economy. What I think is really important to keep in mind there is that companies have been moving in the direction of bringing some of that back home for a while now, thanks to COVID, right? COVID gave a really good test run of, hey, all of a sudden those supply chains are drastically disrupted. What do we do? And nearshoring or bringing stuff back home has been a trend for a handful of years. So companies do have a bit of a test run and a bit of experience in doing this, which I think definitely helps now to the degree that they wanna bring some of it back home due to tariffs.
BF: Yeah, that’s a good point because after COVID, businesses realized that maybe having the lowest cost provider for a certain good in the supply chain and getting that good, you know, 20 minutes before you need to put it on the car that you’re building, maybe that makes you a little bit more efficient from a financial standpoint, but it makes you pretty fragile from a business standpoint. And COVID made business leaders realize like, wait a minute, we really wanna stretch everything and try to optimize for a fraction of a penny worth of gain here. Or should we build a business that’s maybe a little bit more robust? So if there’s something that does slip in the supply chain of goods, we can continue to produce our finished product and continue to make money.
BP: Cool. Well, let’s, that’s a fair amount of tariffs. Let’s touch a little bit on taxes, right? That’s been the other big story, is that we got this new. permanent tax bill, and, so maybe talk us through this a little bit. There was a lot of talk; it finally got done right around the 4th of July. What’s going on here?
BF: Yeah, so maybe first, this is just corporate taxes, so for the personal piece of the tax bill. Has some really amazing resources. Amanda Cook and her department are incredibly knowledgeable and can go in depth and help you with your taxes and tax guidance and tax, and getting ready for the tax changes that are going into effect next year.
So, certainly worthy to, worthy of your time to have a conversation with a peer financial advisor or Amanda, just to get the ball rolling so you can take advantage of personal taxes. But for purposes of our conversation today, let. We’re just gonna talk about the corporate tax changes. The biggest piece, the only part that’s really impactful for us in the near term is business businesses can depreciate a hundred percent of their capital investment for short-lived assets in RD.
So this is kind of the carrot for the tariff stick. If businesses wanna build a new factory to make widgets in the US and they need a bunch of machinery to do it, they can expense those costs immediately, so it should lower their tax liability. Make them a little bit more profitable. So instead of depreciating those goods over five or 70 years, depending on what it is, they can do that day one and that’ll help them manage their tax bill and hopefully makes it a little bit more appealing to onshore those jobs and factories. But the rest of it is pretty much just pieces of the Tax Cuts and Jobs Act from 2017 that we’re gonna sunset at the end of this year are no longer gonna sunset. So the corporate rate’s gonna stay at 21% until, you know, maybe at some point it changes, but as far as we know now, for now, it’s gonna stay there. So the 2017 tax bill really set off a pretty strong bull market for the fall of 2017 and into 18. This bill’s not gonna be as impactful. It’s still important. There’s still things that, that will help the economy, but it’s not that everybody wins. All of a sudden our taxables are considerably lower, like the tax cut and drawback from 17.
BP: You know, when we talk about and the tax code, what I always think about is when it comes to individuals, the last time I looked or read the tax code was some 70,000 odd pages. And you know, if you stack that from ceiling to or from floor to ceiling. that’s about six feet tall of paper, so about as tall as I am. And. You know, the first page of the, my understanding is essentially the, the tax rates, right? This is 10%, 12%, so on. The next two pages are how to calculate your tax bill. And then the other, you know, 69,000 in change pages are ways to get around paying those taxes laid out on the first couple pages. You know, so I do definitely encourage you all to take a look at what you can do to mitigate your taxes, both now and in the future. It’s about minimizing, and controlling really having a function of control on your taxes, both while you’re working as well as in retirement and across your lifetime. It’s not about avoiding taxes. Avoiding taxes is a no win situation. If you avoid taxes, what that does is that gets you, you know, if, your retirement plan is really in a bad spot, maybe you avoid taxes. ’cause then you get three square meals a day and free room and board courtesy of the government in prison. You know, they give you a nice orange jumpsuit. but what we like to focus on, what we think you should focus on, is mitigating taxes and minimizing the amount that you have to pay under the law. So encourage you all to do that. Let’s, shift gears a little bit and talk about, what the economy’s looking at right now. And, you know, obviously there’s a lot of background noise with tariffs and taxes, but ultimately it’s the economy and then corporate profits that really drive financial markets. So, obviously it’s a moving target here and we just saw some additional data today and the Federal Reserve and so on, but where are we at?
BF: Yeah, so actually there’s been a lot of noise, but we’re pretty stable in the labor market, so we need roughly 150,000 new jobs per month to keep the unemployment rate stable, assuming the labor supply stays stable. and that’s right where we are. That’s where we’ve been for a couple of months. That’s probably where we’re gonna be on Friday when the new jobs report comes out probably right around a hundred sixty, a hundred forty, a hundred fifty, right in that range. so that’s enough that if you. If you’re in the job market, it might take you a little bit longer now than it did a year ago to find a job. But companies are still hiring, at a reasonable clip. Certainly there’s not been mass layoffs, which again, was a fear with the, the rollout of tariffs a few months ago. We had the A DP number, which is a DP, does payroll for a lot of small businesses in the us. Their number came out this morning and said there’s a hundred thousand new jobs, which is pretty robust. So the labor market is definitely cooler than we were. A year ago, year and a half ago, but we’re not into any kinda real warning danger zone. It is taking people longer to get hired. If you’re a new grad, it’s particularly challenging to find that first job after school. But we’re not into, you know, anything resembling a recession or serious concern. the other piece, and this is really important, if inflation stays kind of elevated, which it might do to tariffs. Wage growth has been pretty solid, and that might even tick up a little bit. in the labor report that comes out on Friday, that’s what analysts are expecting. It should tick up to about four, 3.8%. So wages are growing a little bit faster than inflation, which is great. That’s what you wanna see. And you wanna see a nice steady labor market. So you don’t want anything. That’s if you’re hiring too many people and that’s gonna be inflationary. And obviously if you’re not hiring enough people, then things slow down. It can get messy. but we’re right in that sweet spot. It’s a, goldilocks for the labor market right now, which is pretty, pretty surprising.
BP: Well, and the reason people are so focused on employment, aside from just societally, is that ultimately the consumer’s an awful big driver of the economy, right? Is that Yeah, it’s 70% of GDP se, what is it? 70%? Yeah. Okay, so, so we talk about the government and the this and that, but it’s really all of us here on this webinar today going out. And so guys, if you take one thing away from this webinar, go spend money. It’s good for the economy, it’s good for the stock market. So next time you’re debating whether to go out to eat or go shopping, do it for your portfolio, right? Is that the takeaway?
BF: And that’s a great segue to this next slide. So this is an alternative data set that we get from Bloomberg. I really like it because it’s an aggregation of credit card and debit card spending from BA, basically every bank in, in the country. So what they’re doing here is showing a rolling 28 days of consumer spending, and you can really see consumer activities. So you can see, you know, the line spikes as you get close to Christmas. and then you can see a big spike as we get around the, tariff rollout in April. So consumers are absolutely front running tariffs and they spent like it, they wanted to buy things that they thought would be more expensive post tariffs, and then there was a lot of uncertainty after that. So you can see the drop there in kind of the end of March. Remember, it’s a rolling 28 days, so the dates don’t line up. Exactly. Consumers absolutely get freaked out by tariffs. And they pulled back on spending and then they started sticking their neck out and realizing, eh, it’s not as bad as what we were fearing. And now we’re having a bounce back. So consumers are feeling a lot better. We got some consumer data the other day. Consumers are feeling better than expected. We’ll get more numbers from University of Michigan on Friday, but we talked a little bit last, webinar, Brian, about the gap between. Hard data, like things that we can measure and sentiment data. The things that like, basically survey data are people’s opinions and there’s a big gap between the two. The hard data was strong and the soft data was really weak, and what we’re seeing is the soft data is starting to improve. So usually that gap, when you get a gap between hard and soft data, it takes about six months to close. You know, whether it’s one way or the other. But what we’re seeing is it’s closing because consumers are feeling better about the economy. That’s a good thing. That means, you know, it probably has a little bit more runway into the rally, the equity market rally that we’re experiencing now, and it points to an economy that’s strengthening from some kind of choppy, weak numbers, at the beginning of the year.
BP: So let’s use that as a, kind of a segue here to talk a little bit about what might happen for the rest of the year.
BF: Yeah. So we got GDP numbers this morning. It was 3% over the course of the year. We should be around one and a half. If you remember the first quarter we’re down 0.5, I think, with the revised number headline, I think was down 0.3. We talked about the What was it? The final goods number? So the numbers excluding tariffs and or sorry, imports and exports to just focus in on what consumers and businesses are spending, because that’s a better core measure of GDP that came in right about where it was supposed to, when I think it was 1.4, 1.3 in there. So consumers are feeling good. Businesses are starting to invest a little bit more. The only real weakness that we can point to is housing. Housing has been really slow. It’s been slow for years, but it’s getting even slower. That’s a little bit of a drag, but you know, we’ll probably come in at about one point a half percent growth, which is fine. You know, that’s should be about run rate. and then inflation, you know, it probably picks up later in the year. I dunno if you remember back to the real inflationary period after COVID, every month, inflation report would come out and it’s kinda like whackamole every month. It was something else that was spiking the number. Maybe it was car insurance, maybe it was housing, whatever it was. I think we might start to see that into the fall. But analysts are certainly expecting inflation to, to come up, fairly considerably. and then unemployment’s supposed to move up. Not too much. We’re at 4.1, now we’re at 4.2, at the last report. So maybe it moves up slightly. None of those numbers are terrible. And I honestly, I think the inflation expectations are probably gonna be wrong because they’re too high. ’cause we are seeing enough weakness elsewhere in the economy, particularly for housing. And that’s a big piece of the inflation report. If that comes in weaker because people are nervous about making big purchases, then we’ll see lower inflation numbers. So that’s kind of where the market thinks we’re going. Actual data deviates from that, then we’ll see more market movements. But the real question that’s on everybody’s mind now is kind of where, what catalyst do we have to extend the equity rally into the back half of this year and hopefully into next year? That’s probably gonna come from lower interest rates from the Fed. So the, fed cutting interest rates, they just finished their meeting, this morning. They’re not cutting. this week or this meeting, maybe they do it in the fall. Fortunately, I didn’t, wasn’t able to listen to the conference with, press conference with Powell. So, we’ll see what actually happens there. But that would be a reason to get investors excited again, and take valuations up maybe a little bit higher and see businesses maybe a little bit more profitable is if short-term interest rates do come lower because the Fed is cutting rates. But right now there’s not a real strong, reason to, cut interest rates ’cause the economy’s doing. Doing just fine.
BP: You, know, you mentioned the expectations, right? And I think that’s always a good reminder for folks is that, you know, markets don’t care so much about good or bad. They care about better or worse. And I think that’s a key distinction is that, you know, 3.9% inflation is a little bit higher than what the fed targets. They usually target, what, 2% or so? Two and a half. Just they’re open for us. Markets don’t care. They care less about 3.9 than they do. If they’re expecting 3.9, does it come in at 3.7 or 4.3? And so I always think that’s a good reminder is that even bad news can cause markets to rally if it’s not as bad as expected. And even good news, and we see this all the time, can cause markets to sell off if it’s not as good as hoped for.
BF: Yeah, and honestly kind of pivoting on back to the tariff idea, there’s been a fair number of companies report earnings this quarter that have rallied significantly on not great earnings. They were passing the message on to investors that it’s not gonna be as bad as they feared. So like Hasbro, they make a bunch of toys and poured a lot from China, but they’ve actually done really well after earnings because they’re better than expected. The bar was so low. If you just come in slightly above it, then people get excited about it or investors get excited about it.
BP: Last slide and then we’ll, we’ll pause and we’ll take questions. for now is, what about a weaker economy and the impact on, On the mar on the, stock market.
BF: Yeah. So what you’re looking at here is basically an aggregation of a bunch of economic data points and you, the model’s comparing those data points to history, to put it in kind of different regimes. And then looking based on history, when we had this similar set of economic variables, what did the equity markets do? So right now we’re in what the model’s calling a weak economy. But you’re still on average, gonna see positive returns. And this is from, the beginning of the, third quarter. So, you know, we did 6% in the S&P for the first half roughly if we did another 4%, which is what that model was showing, you know, take it to 10. If we got 10% outta the s and p, that’s pretty good. It’s better than average and certainly with all the changes that we’ve gone through over the course of just the first six months, if that comes in, I think we should all be pretty excited about it. And the economy is showing signs of strengthening. So we’d be moving to the right on that slide and hopefully a little bit better equity returns.
Kathryn: What current economic conditions are impacting your financial planning and how is Pure financial adjusting their financial, our financial planning for the conditions?
BP: Yeah, that, that’s a great question. And so I guess I’d answer that in a couple ways. one is that we have, processes in place to, to regularly review the financial planning, and investment assumptions that we use. so we, excuse me, we have several committees that, Obviously when, if you think about financial planning, we have assumptions around what inflation rate might be in the future, what, growth might be, et cetera. And same thing for investments, and those are based on what’s happened historically as well as, our accumulated experience. And then obviously a fair dose of common sense. and we regularly review those, so we review those, quarterly or annually or as appropriately. but I would also say that, the bar is high for changing things just because, again, the one thing we can guarantee with a financial, any kind of forecast is that it’s wrong. Is that, in other words, the 50 year average for inflation is roughly 3.7%. That’s as good of a number as any to project into the future, but I guarantee it won’t be 3.7%.
So then it’s like, what should it be? And I think the reality is that you come up with a really good estimate, but then you adapt on the fly because life’s not static, right? Tax law changes, retirement dates change. Cashflow needs change, markets change. so I think there’s an element of what are the inputs into a financial plan, but there’s also an element of conversation with people around. Okay, well life is changing or life is evolving, or you know, whatever the CPI number isn’t what somebody is spending money on. That’s just a government number, right? If you’re out living in a really particular area or buying something that everybody else wants, your cost of living may be soaring while somebody else’s is very low, right? And so I think it’s important that a financial plan is always a customized thing to an individual that becomes a living, breathing thing rather than a one time, Hey, this is what the lab says the numbers should be.
Kathryn: And then there’s several questions about where does the tariff money go? Like, coupled like where does the money, where and revenue go for the tariffs? Does it go for government programs? Another one was asking about, you know, what’s the idea of the tariffs? You know, we thought that it was lowering the national debt and things like that. So can you kind of touch base on, you did already a little bit, but just kind of touch base about what exactly are these tariffs going towards?
BF: We had on one of those slides how much money the treasury collected, I think last month. And it was like 26 billion. so that’ll increase over time, but tariff money goes straight to the treasury. So it’s Uncle Sam’s purview. After that, does it lower the national debt? Well, yeah. you’re getting in theory was like 500 billion or so worth of extra tax revenue from tariffs. How they spend it is, you know, the budget that just passed, a lot of it is tax cuts.
Kathryn: Please explain how this is not inflationary. You guys had mentioned if we pay higher prices for the same products, either through tariffs or from increase of domestic manufacturing costs to hire more people, et cetera, to produce, if inflationary, then how will this not cause because, increased interest rates?
BP: I’ll answer the first part of that ’cause the first part of that is easy. And then I’ll give Brian the other, Brian, the hard part. It is inflationary. If you pay more for stuff, it’s inflationary. It’s, as simple as that. And so I don’t think there’s an argument made for it, in a vacuum. Again, economists favorite saying is, et cetera is PowerBI, which is essentially all else being equal. All else being equal. It is inflationary. the hard part of the question, I’ll kick over to the other Brian.
BF: Yeah. So that’s really the,most challenging question to answer. The Fed has researcher papers that you can pull up if you wanna read. That suggests that the inflationary impact is transitory the word that nobody wants to use. No economists wants to use that after, we went through the inflationary period, the first go around and after COVID, but that’s what their research suggests. So what they think will happen is prices of washing machines and all these different goods. You know, we highlighted. Home goods and appliances, that those prices are gonna move up one time to incorporate tariffs and then move sideways at the normal rate of inflation. Is that actually how it’s gonna work? Nobody knows. The worry is. Now cost of living is higher, so now you need to pay employees higher, more wages because cost of living is higher. And then you get that feedback loop of higher costs, requiring higher wages, requiring higher costs and more inflation. You know, that’s what we had in the sixties and seventies, that wage price spiral. I don’t know that’s what’s gonna happen because the tariff impact’s probably not gonna be big enough to, generate that kind of response. the last piece is essentially tariffs are attacks. Taxes generally are not inflationary. They actually work the opposite way because you literally have fewer dollars to spend on goods ’cause more is going to Uncle Sam taxes. So. We do expect inflation to move higher, you know, then we had a slide on there, for what we thought it was or what the consensus was putting it at, 3.9%. So that is higher than where we are now. but the real question, is that just a one-time boost as tariffs get incorporated into prices? Or is it something that sets the ball rolling to longer, more durable inflation? Hope? The answer is no. That’s what the research suggests. We have to live through it to find out.
BP: You know, one thing to, to weigh in on there too is that, At the end of the day, I think most people would say in tariffs or inflationary, right? I mean, I certainly, I said that. but, the other thing is that the idea is that they’ll boost economic growth, right? Like, like the administration’s not doing tariffs ’cause they think it’s gonna crater the economy. that’s not the goal, right? What whatever side of the political aisle you’re on. The idea here is that in the long run, and maybe even in the intermediate and short run, that this will be good for the US economy, right? And at the end of the day, inflation, particularly at very high levels, is insidious and very bad for the economy. But you would rather have, what you really care about is the difference between economic growth and inflation, right? So how much better off for people getting? And so just to make up numbers, if you had an economy growing at 3% and you had nice stable inflation at 2%. you’re kind of 1% better off. But if the economy, if inflation’s at four, but the economy’s growing at seven, you’re better off overall, even though the price of goods is going up. And so there, there’s an element of even if inflation drifts higher, if the economy is accelerating because of tariffs and, jobs coming back home and, this and that. the idea is that you could still be better off even if you’re paying a little bit more because you’re making more than that. it’s difficult to manage, right? It’s a little bit like wrangling a stallion, if you will, because you gotta get inflation to, to stay in control and this and that. So it’s not easy to do. but there is a scenario where this comes out with a stronger economy, even if inflation is a little bit higher.
BF: In equity markets generally like inflation around, they do the best when inflation’s in the three to maybe low fours because they can pass on cost to consumers, and you can usually do that when the economy’s running a little hotter than normal. Historically, there is a kind of a sweet spot in inflation for c corporate earnings and better equity market returns, not necessarily a comfort if next time you have to go out and buy a new washing machine, it’s a thousand dollars more than you thought it would be. But there are economic impacts to, to inflation that are not all negative. Yeah.
Kathryn: Okay. And the couple last questions before you go on. do you have a outlook for the oil and gas prices in the near future? Do you have any outlook on that?
BF: Brian, you need, you take that one. They’re gonna fluctuate. I dunno. They’ll go high and low. Okay?
BP: I mean, I don’t, know. Like, here’s the problem with forecast, right? And now I’m happy to give an opinion, but even if you know what the news is gonna be, you still might not know what’s gonna happen. I mean, if you told me that there was going to be Israel and Palestine at war, Israel attacks, Iran, Russia and Ukraine are fighting, and then America’s gonna bomb Iran. And oil prices are gonna go down. I mean, if you gave me that news cycle, I’d tell you oil would be at 120 bucks a gallon. And it’s not. and so it gets really difficult, particularly with something like oil that’s so subject to, weather, which is unknowable, geopolitical events and stuff. Yeah, I mean, so it is tough to say, I’ll say this. I don’t think oil is going away. I don’t think we’re going to 10 or $20 a barrel. I think that, but there’s also probably a ceiling thanks to all the oil that’s been found in the US through fracking and stuff like that. So, you know, is a natural range. 50 to a hundred maybe. But I don’t think it goes to $20 a barrel. I don’t think it goes to 200. Yeah,
BF: I’m not an OPEC analyst or, you know, have any real deep insight into that. But my takeaway is that OPEC is willing to produce a little bit more than they have in the last couple of years, which should put a little bit of downward pressure on prices.
Kathryn: Any thoughts about AI and its potential to impact the labor market?
BF: So that’s a great question that nobody has the answer to. We’ll say that, you know, technology has been advancing quite a bit in the last couple hundred years andt technological advances have always created more jobs, not fewer. It’s not great comfort if your job gets replaced by a computer. You know, my office is in Redmond. 20 miles or 10 miles down the road from Microsoft headquarters, we have clients that are legitimately worried about keeping their job because if they’re worried, AI’s gonna take it. So if you’re working in tech, you’re working in programming, it’s gonna be tough. But how that works through the greater economy over time. It’s anybody’s guess, but I think we can look to history and take a little bit of solace that technological advances actually create more jobs and make a more efficient economy. And it doesn’t work the other way around, which, you know, there’s certainly people that think AI is gonna put us all outta work. It’s a great, it is one of the big drivers for why the equity market’s done as well as it has over the last handful of months. ’cause there’s a lot of enthusiasm, a lot of investment, a lot of dollars going into ai. So for the moment it’s. A healthy tailwind.
BP: I agree a hundred percent with Brian. That and AI is frightening, right? I mean, setting aside the whole like, vision of the Terminator movies and stuff like that there, there’s also, you know, the idea that. Well now people don’t need a whole host of jobs ’cause AI can do it. But you could have said the same thing for, to, Brian’s point, almost any technological advance in the last several centuries. And the economy’s continued to grow. And I don’t think anybody would argue that for most people the standard of living is infinitely higher today than it was 10 years ago or 20 years ago. Or a hundred years ago. And that’s because some company, somewhere for the most part. Made something and created something that enhanced people’s lives, whether that’s an iPhone to, you know, FaceTime with your grandkids across the country or a plane so you can get to, you know, wherever you want to go in hours rather than weeks. Or better medicine. So you live an extra 30 years, right? Companies have always found a way to, to leverage technological advances, to improve people’s lives. And when you do that, it, really does two things. One is it creates jobs, and two is it creates corporate profits, which tend to lift financial markets, which is why there’s a tailwind behind investing despite the ups and downs, right? So if as long as you don’t think that’s gonna change, you should be an investor. As far as the jobs, the, tricky part is. the jobs that are available may not go away, but they may change and shift. And so it’s, is your particular job still available or does it change, or What knowledge base is, needed to, for some of these jobs. So I’m sure that there will be shifts and, you know, people will be disproportionately helped and hurt. but I think in the long run, people that can harness AI will be far better off. And it’s a productivity tool, just like the internet, right? The internet replaced jobs to a degree, but I don’t think any of us would be more productive without it.
Let’s talk a little bit about, stocks and bonds here. I wanna talk a little bit about treasury yields. This has been a topic that’s come up a lot and has quite a bit of an impact on financial markets and the economy and the dollar and so on. And the idea here is that. Interest rates obviously went up a lot, and this is 10 year treasuries from, you know, 2021 to 2023, and then they’ve been mostly sideways since there. And, you know, there, there’s periodically we’ll get questions around the national debt. along the way here, the US almost breached the debt ceiling in quote unquote defaulted. we had a tariff war, tax bills, et cetera, et cetera. interest rates have been pretty up and down, particularly when you look at a little bit longer term, right? So if you look at treasury since 1960, a lot of people like to reference that really long decline from 1980 to call it 2020 or so, as a tailwind for the economy. And I think there’s an element of that. but we said this, I think last time we gathered for a webinar, but you know, even if interest rates go higher from here, I like to, if you look at the period between 1990 and 2000, look at those two gray bars. The grays are recessions, by the way. and, during that period you had interest rates go down, up, and so on and so forth. the 1990s were a pretty darn good time for the economy and for the stock market. And in fact, we actually balanced the budget and had a surplus for the first time in, you know, infinity during that period as well. But look at where interest rates were on the 10 year treasury. Were anywhere from five to 7.5%. we’re south of five now, but the point being, I don’t think we wanna go back to 10 or 15% interest rates. But we don’t have to look back too far to go to a historical example where even if interest rates were to go up a couple hundred, basis points from here, you could still have a really strong economy. So I think that’s really important to, to focus on. Obviously it has impacts on some parts of the economy, like housing and. You know, Brian, one, one thing that would be interesting, and, I don’t know if it’s now or in a future webinar, is maybe we focus a little more on housing because to, your point, that’s been weak now for what, three years or so? After getting pretty frothy from, you know, the late teens into the early 2020s, you would think that the housing market would’ve adjusted to higher interest rates by now, particularly given that the economy’s been strong and jobs been strong, but it hasn’t.
BF: Yeah, I think it really just comes down to affordability. Home prices spike so much after COVID that wages just haven’t been able to keep pace, especially when you’re looking at a six, 7% mortgage. So you’ve got prices that you know exploded after COVID and now you’re layering on top of it extra financing costs. And on the supply side, you’re also looking at people that more often than not, refi their mortgage probably less than 3% and don’t wanna move. If it means they’re gonna have to go to a six and a half percent mortgage. To, go ahead and swap to even an equivalent house would be more expensive. but there’s always gonna be some movement within the housing market ’cause people have to move for jobs. Unfortunately, people get divorced, unfortunately, people pass away.
So there’s always gonna be some supply on there that we’re still kind of plumbing the depths of limited supply. But you know, there is a school of thought that the housing market is a good indicator for the overall economy. Historically, that’s been pretty accurate, but since COVID it, it hasn’t really been accurate at all ’cause the housing market’s done pretty sluggish results, but the economy’s done pretty well. So, you know, something, one of many examples of an economic relationship shifted after COVID.
BP: Yet another reason COVID was awful.
BF: Yeah. And you know, think that, just to highlight your comment there about interest rates, you know, I think a lot of us got used to 10 year treasury rates being, you know, around two, two point a half percent because that’s, there was that range or lower from the financial crisis through COVID and that’s what people got used to. But that was not normal relative to history. Where we’re now is what’s really normal relative to history.
BP: Yeah. No, and that’s a really good point. And with interest rates, there’s two sides. So if you wanna move or you’re taking out a new mortgage and it’s 7% instead of three and a half, obviously that’s a bad thing, right? It’s a good thing for the bank that could actually make a mortgage loan. It’s bad for you.
BF: It’s a good thing if you own mortgage backed securities.
BP: Well, what if you’re an investor, right? Because for years we, we got the question before about, financial planning assumptions and you know. Not everybody. There’s people that are all in stocks, all in bonds, all are in to alternatives, all in cash, whatever. Most people are a mix of some or all of the above. most people also, and folks, if you don’t know this number, go figure it out, is you should have a required rate of return to meet your financial goals, right? That what return do you need in order to be financially successful? whatever that number is. If a portion of your assets are in bonds, and those bonds are effectively getting zero, it’s a lot harder to meet that number. Now that you can actually get return. ’cause when you buy a bond, remember now you’re the lender. Higher interest rates are your friend. this slide I think is instructive because it looks at the bar is the range for different types of bonds. While those are treasuries, municipals, you can see across the bottom, investment grade, corporate bonds, mortgage backed securities, and so on. so for instance, with treasuries, you can see in the last 15 years have been as low as a half a percent, and as high as a little bit over five. The purple bar is the 15 year median, and then the blue diamond is where we are right now. And you can see that in basically every instance we’re above and usually well above the 15 year average. And so, you know, if the 15 year average for treasuries was 1.6 and now it’s 4%, that means you’re getting an extra, almost 2.5% by owning treasuries. And so while that increase in interest rates was painful for bond investors because it, when interest rates go up, the value of your bonds falls and that hurts returns temporarily. As long as you have a reasonably long time horizon on your bond investing, these higher interest rate are your friend, because now as a lender, you’re getting more return and if the bond portion of your portfolio over the coming year, two years, five years, 10 years, is gonna generate more return, well that takes some of the pressure off the other asset classes to produce in order to still get you to that required rate of return from the overall mix. So when people ask me if I worry about interest rates going higher within reason, I say no. What I worry about is interest rates going lower and going back, I don’t think this is gonna happen, but going back to where we were to, to the time period that Brian f referenced, because then that makes it harder to get attractive returns from your bonds and get the returns you need from your portfolio.
BF: Not having, more income in your, having more income in your bond portfolio also makes it more stable. So it’s another reason why, you know, if you’re. As you put together your financial plan with your advisor, you know, maybe you don’t have to take as much risk today as you would’ve had to five or 10 years ago. To Brian’s point, if you’re getting, you know, 1% on your fixed income exposure ’cause you own a bunch of treasuries, well now you’re getting four, maybe even a little bit higher with a diversified fixed income portfolio.
BP: You know, and that brings up, and I’m gonna flip to the next slide, but, you know. As for those out there, some folks on here are pure clients and you know, if you have questions about any of this, obviously talk to your financial advisor for those that, are not pure clients, talk to your financial professionals on some of this, you know, talk to them. And ask them, if, you guys have figured out what your required rate of return from your portfolio is and, what your overall mix is as far as stocks, bonds, alternatives, cash, et cetera, and if that’s appropriate for what you’re trying to accomplish. And if you don’t have a financial professional or you just want another set of eyes, we do offer free financial assessments to folks that come to this. so at the end, Catherine will put up a, link to click on and, really usually we charge several hundred dollars an hour in order to meet with folks. But for everybody that attended a webinar like this, we waive that fee. We offer a free complimentary financial assessment where we’ll take a look at your overall portfolio, what kinds of risk you’re taking, what kind of returns you’re targeting, and if that’s in alignment with your goals. we’ll also we mentioned briefly taxes. We also will get involved with our CPA team in-house to look at your tax situation today and in the future, and what steps you should take given some of the recent tax law changes in order to position yourself to really control and minimize your taxes across your lifetime. and really just take a well-rounded look at your financial situation. So again, Kathryn will put that up later on in the webinar. If you’re interested, click on that. There’s no cost, no obligation, but it’s a free set of eyes from a certified financial planner to see if you’re still on track to meet your financial goals. with that in mind, let me also just shift here now to, one of the concerns in the treasury market has been, what’s going on with tariff wars and this and that, and will people oversee, stop buying treasuries? And so lemme kick it over to Brian f and get his thoughts on that. There’s a lot going on in these slides, but maybe, give us the big picture concept.
BF: Yeah. There was some chatter in the financial media a few months ago that foreigners were stopped. We’re just not buying treasuries at auction when they’re introduced to the market. ‘Cause there, there was a bad 20 year treasury auction. 20 years is like the. The cousin that nobody likes in the, treasury market is just kind of a weird one. but subsequent to that, the treasury auction’s have been going fine. And then also the data that we can get from the market shows that foreigners, foreign buyers have been in fact buying a little bit more, recently than they have has in the near history. So that argument just doesn’t really hold water. You can empirically show that it’s not true. but. We do have two and a half trillion dollars annual deficits, and that is a lot of debt that needs to get issued enrolled every year. I think we’re running, what is it? Eight, eight and a half, 850 billion a quarter, I think is what refi. Treasury refis are an issuance. So yields are probably gonna stay higher on, on treasuries, for a while, unless there’s something unexpected that happens. But again, if you’re an investor and you’re buying a 10 year treasury, you’re, getting four ish percent on that, which is substantially higher than what you’re used to. And if you’re taking a little bit of credit risk, you can do better than that. the other part of this slide is just talking about. How much debt the US has relative to GDP. It’s an interesting number, but it’s not super important. What’s really important is the interest that debt generates because you gotta pay the interest, you can roll the debt. From that standpoint, the US is, you know, kind of in a spot where you should probably pay attention to this, you know, if you’re, elected official, but we’re not into the danger zone. so that’s, we don’t have great company there. I don’t think you want to be next to, running up next to Italy, who’s known for not really running a very balanced budget for forever. But we are where we are not really in the danger zone of impending doom, but something that you probably want to pay attention to over the next decade or two.
BP: Yeah, I mean on that note, I’ll just say that I started in this business in 1996 and on my first day people were worried about the debt, the deficit, how much outstanding treasuries we had, foreign countries buying our bonds. And you know, you flash forward more years than I care to count and people are still worried about it and it hasn’t actually mattered. So it’s one of those things that’ll matter when it matters. which brings me to the dollar. we don’t have time to go deep and we’ve done this several times. We’ll probably put out something, on the website in blog form or article form here soon in on the dollar. Again, at the end of the day, the dollar has been weak this year. It’s softened, that has both good and bad things. It, has good parts for the economy and negatives, and it’s good for some companies and negative for others. As a diversified investor, same deal. It’s good for your international stock holdings. but the key thing here is that if you look at a, whatever this is, 35 year, run, 30 year run, 40 year run. I, gotta do the math here. you know, you’ll see that the dollar is still well in the range that it’s been in. It’s gone up and down, but it’s been in this range for quite a while. At the end of the day, there is no viable alternative to the dollar. So anytime you see a doom, a doomsayer saying, Hey, the dollar’s going away, it’s gonna be supplanted. They don’t know what they’re talking about, or they’re trying to get your eyeballs, or they’re trying to sell something because there is no replacement for the dollar in the next 5, 10, 15 years. Longer term, maybe, who knows? Can the dollar share of international markets diminish a little bit or decline? Sure. But as far as going away and not being the reserve currency. I would stake a whole heck of a lot on that not happening because I just don’t think that there’s any foreseeable outcome in which that does.
BF: There’s just not an alternative that has the infrastructure around it. So, you know, if you’re importing goods or exporting goods to your, country and dealing with other currencies, the dollar is the one that you can hedge your risks and you can do it efficiently and you can do it cheaply and you can’t say that about really any other currency. So even if you don’t like the dollar and you’re a foreign importer exporter, it’s kind of the only game in town. It’s the cleanest dirty shirt. It’s the only one where you can really limit your risk, from interest rates, from currency movements. ’cause there is a robust market around it. There’s lots of financing, and just other currencies don’t have that. So it doesn’t really matter what your personal opinion is. The economy’s telling you, you have the global economy’s telling you have to use the dollar.
BP: I wanted to throw this slide up. This is through June 30th, so it’s a little bit dated at this point, but it’s kind of a first half snapshot and we’ll probably end with this slide and invite a few more questions. But just looking at what happened in the first six months of this year and on the left hand side, what I would say is, if you look at the wheel, we had 122 trading days. In the first six months, we were up 60% of those days and down 40%. For what it’s worth, that’s pretty close to historical averages. I believe that the stock market is up on about 53% of days historically. so the stock market is up a little bit more than half the time historically, and was up about 60% of the time. The first six months of this year. You can also see the worst day in the best day, and you guys might all remember some of both of those. The worst day we were down about 6% in early April. That was in the midst of a really sharp sell-off. The best day is one that I’ll take partial credit for. Joe Anderson and I were doing a webinar that day and that nine and a half percent rally almost entirely occurred while we were speaking. I don’t know if there’s a correlation there or a causality, but, the reality is that was the best day or the second best day since World War II, so certainly a volatile start to the year. And what that resulted in over the first six months is from January 1st to February 19th, a stock market that was having a pretty good start up, four and a half. If you annualize it over the course of a year, that’s like a 20% return, which would be a great year. Then we got into a little bit of an ugly market, right? As you all remember, from Feb 20 to April 8th, tariff tantrums, down nearly 20% on a lot of indexes, we did hit bear market down more than 20% territory. And then since then, a really substantial rally that’s continued since this slide was published. up 25% to end Q2. up and on the year, you can see, and again, this is through June 30th. You could see, focusing on the left hand side, year to date in US dollars is what’s relevant. First half of the year, the s and p was up 6%. A lot of these other markets you can see in emerging markets, EFA is basically Europe and Australia and Japan and Canada. the Eurozone, emerging markets all up, double digits. There a function of good, performances locally. And then also I mentioned that weakening dollar, which helps foreign investors.
So with that, gonna pull up one last slide and then go to additional questions. And I wanted to pull this up for two reasons. One is, 66% of investors in this survey here regret impulsive or emotional investing decisions. And the reason I think that is relevant is when you look at the first half of the year. With this kind of volatility, where you had really good days, really bad days, down 6%, up 10%, it’s really easy to deviate from your long-term financial plan. More often than not, surveys say that people wind up regretting that, The other is just a little bit of levity, and I know that it’s nobody on this webinar, but it turns out this was the most shocking statistic I’ve seen in a while, that according to this survey, 32% of people admit to trading while drunk. So, I’m gonna end it there and hope to God that you’re all, hopefully you’re not overtrading your accounts ’cause survey after survey shows that’s a recipe for disaster. But I’ve gotta think that if they gave breathalyzers before trading performance would be even worse. So hopefully you’re all sticking to your long-term financial plan and, following the course. If you want a second set of eyes again on what you’re doing, reach out. Sign up for that free financial assessment. We’re happy to meet with you. No cost, no obligation. We’ll take a look at your taxes, your investment portfolio, your cash flow decisions, help make sure that you’re on the right path. And obviously again, if you’re a pure client, you know, we thank you again and please reach out to your financial advisor with any questions that come out of this, webinar here. Katherine, any questions before we wrap up?
Kathryn: The president wants Powell and the Feds to cut interest rates, but we are saying that the economy’s doing well and we don’t need to lower them. So what are your thoughts about that?
BF: There’s two things there. One, the economy is running decently. Well, and there’s not a huge impetus or need for rate cuts. Rate cuts are supposed to stimulate the economy by making it easier to borrow money. but if you do that, then you have an economy that’s running even faster, and that should impact inflation. Make inflation move higher. You can’t make a really strong argument that we need to cut immediately. but when it comes to the labor market, typically there’s a pretty precise tipping point where, you know, the line moves sideways for a long time and all of a sudden it spikes when you hit a recession. And those small little wiggles, You wanna avoid those small wiggles turning into something bigger. So maybe you could make the case for a stronger case for rate cuts later in the year. That’s what the market is expecting, but every time we get a good data point out the market’s pricing out rate cuts, you know, we’ll go another month or two. You know, if we do get a pretty strong job number on Friday, let’s say we get 150, 160,000, I bet you see another cut priced out for this year. other thing to keep in mind is. The Fed controls overnight rate, so it controls a very short-term borrowing. It does not control 10 year yields or the yield on a 10 year treasury that’s set by the market. So while it would help anybody with floating rate debts, so like credit cards or any kind of short-term debt, to have lower interest rates, it’s not gonna do anything for housing affordability. It’s not gonna do anything from mortgage costs. so it’s not gonna help that aspect. the Fed seems to be pretty evenly divided. There’s, I saw it briefly this morning, but there’s two dissents from the Fed, FOMC, so there is some disagreement there. I think the last time there’s two dissents on the vote was early eighties. You remember Brian?
BP: Yeah. For what it’s worth, the two dissents were the two appointees Trump had put on as well. So there, there may or may not be, gamesmanship there. They’re gunning for a job.
BF: But yeah, we will need cuts at some point. But it’s pretty darn hard to make the case. We need it, like right now.
Kathryn: Well, we have about one minute. So, there, the last two questions were about Bitcoin and gold or precious metals. So, you know, what about any comments about Bitcoin in 30 seconds and any comments about gold being, you know, having that in your retirement portfolio?
BP: You know, if it’s physical gold, I want to hold that in the retirement portfolio because it can cause issues when it comes time for RMDs that hold it probably outside. With both Bitcoin and gold, I’d say that they can make sense as a hedge against various outcomes. I think in a lot of ways Bitcoin is potentially supplanting gold and has done really well. I, think it’s a matter of how do you size it, how much do you own? we’re not opposed to owning a little bit of it. We don’t own it in pure portfolios, but we regularly talk to clients and see, does it make sense, you know, if they ask and, Hey, do you want to put a couple percent in? It’s, yeah, in a lot of ways, particularly with Bitcoin, it’s a little bit of an option on it continuing to go up. And if you own. 1% of your net worth and it does really well, you’ll be happy. And if it doesn’t do well, then you’re not gonna have suffer too much consequences. where I think you can get into trouble is if you get into some of the more esoteric, cryptos or if you have just way too much in where it’s such a volatile asset class that, that it may not make sense, but yeah, in moderation, I think it could situationally.
Kathryn: Okay, well we have come to the end of our webinar. We thank everybody for being a part of this. Brian Perry, Brian Fahey. We appreciate all of your knowledge and expertise and as Brian Perry had mentioned, you would like to take advantage of this, free consultation with one of our advisors. Or if you’re already a pure me member of our pure family, then reach out to your advisor.
Thanks everyone, everybody have a great day. Bye. Thank you.
Subscribe to our YouTube channel.
IMPORTANT DISCLOSURES:
• Neither Pure Financial Advisors nor the presenter is affiliated or endorsed by the Internal Revenue Service (IRS) or affiliated with the United States government or any other governmental agency.
• This material is for information purposes only and is not intended as tax, legal, or investment recommendations.
• Consult your tax advisor for guidance. Tax laws and regulations are complex and subject to change.
• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC an SEC Registered Investment Advisor.
• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.
• Neither Pure Financial Advisors nor the presenter is affiliated or endorsed by the Internal Revenue Service (IRS) or affiliated with the United States government or any other governmental agency. This material is for information purposes only and is not intended as tax, legal, or investment recommendations.
CFP® – The CERTIFIED FINANCIAL PLANNER® certification is by the CFP Board of Standards, Inc. To attain the right to use the CFP® mark, an individual must satisfactorily fulfill education, experience and ethics requirements as well as pass a comprehensive exam. 30 hours of continuing education is required every 2 years to maintain the certification.
AIF® – Accredited Investment Fiduciary designation is administered by the Center for Fiduciary Studies fi360. To receive the AIF Designation, an individual must meet prerequisite criteria, complete a training program, and pass a comprehensive examination. Six hours of continuing education is required annually to maintain the designation.
CFA – Chartered Financial Analyst® designation contains three levels of curriculum which includes analysis using investment tools, valuation of assets, and synthesizing the concepts and analytical methods in a variety of applications for effective portfolio management and wealth planning. Candidates must meet enrollment requirements, self-attest to professional conduct, complete the approx. 900 hours of self-study, and successfully pass each level’s 6-hour exam to use the designation. CFA Institute does not endorse, promote, or warrant the accuracy or quality of Pure Financial Advisors. CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
