The Federal Reserve: An Overview of the World’s Most Powerful Financial Institution Nearly every country in the world has a central bank that plays an important role in guiding the nation’s economy. The actions of several of these, including the European Central Bank (ECB), the Bank of England (BOE), the People’s Bank of China (PBOC),...
During the second half of 2022, worries about a potential economic slowdown grew. Those fears seemed to dissipate as the calendar flipped to 2023, but they’ve recently begun percolating again. On April 11th, the International Monetary Fund (IMF) released a new forecast1 for short and intermediate term global economic growth, which included some of the...
“Inflation is raging. There might be a recession. Markets are volatile. An election is on the horizon. Several banks have failed. We might hit the debt ceiling. Russia is still invading Ukraine. China might invade Taiwan.” The list goes on and on, a litany of troubling headlines. It’s enough to keep you up at night....
As you may have heard, the collapse and takeover by the Federal Deposit Insurance Corporation (FDIC) of Silicon Valley Bank (SVB) and Signature Bank has driven the recent volatility and investor concern of “contagion” in financial markets. SVB, the 16th biggest bank in the US, had operated as a major funding source for Silicon Valley […]
If you looked at your statements late last year, you know that 2022 was tough for investors. The stock market, as measured by the S&P 500, declined nearly 20%. S&P 500 – 12 Months (as of 1/24/2023) However, what made 2022 an unusual year was that even as stocks were falling, there was almost no […]
At year-end 2021, the S&P 500 closed at an all-time high, with many stocks hitting never-before-seen market caps. Companies exhibited record earnings, and housing prices soared in many parts of the country. Inflation fears were muted, and investors were accustomed to an easy money Federal Reserve (Fed). However, as the calendar flipped to 2022, little […]
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You may have heard that the Federal Reserve (the Fed) is trying to contain inflation by raising the federal funds rate. However, the Fed has another tool at their disposal: Quantitative tightening (QT). Quantitative tightening is a term you may not have heard of; after all, the Fed has spent the last 14 years or […]
Most investors hold bonds for safety, diversification, and income. In fact, you’ve probably read or been told that you should hold stocks for growth and bonds for safety. There is logic to that advice; bonds have historically been much less volatile than stocks and historically have provided ballast during stormy markets. That concept might leave […]
The first eight months of 2022 have been tough for investors. Stock indexes around the world have declined by double digits, while historically safe bonds have suffered their worst performance in decades. Eventually, markets will resume their upward trend, but unfortunately, no one knows exactly when that time will come, and furthermore, no one can […]
With the consumer price index at forty-year highs, this is a good time to take a look at what types of investments might make sense in an inflationary environment. Before diving in, though, it’s important to note that there are no foolproof methods to avoid short-term surprises. The bottom line is that if inflation readings […]
Financial markets remained volatile in the second quarter of 2022, while inflation reached four-decade highs and concerns grew that inflation fighting efforts might tip the economy into a recession. Regarding the possibility of a recession, some context is also in order. There is an old joke that goes like this: Q: What’s the difference between […]
During bull markets, it’s relatively easy to adhere to the philosophy of buying and holding for the long-term, but when markets get rattled, it can be difficult to stay the course while your portfolio falls in value. This has been the case recently, as fears around inflation, war, pandemics, central bank policy, and recessions have […]
Part 3: Real Estate Investment Trusts (REITs) This article is the third in a series looking at the pros and cons of various income-producing vehicles. But before we dive in, we’ll begin with an important caveat: Here at Pure Financial Advisors, we believe that for most individuals, the income alternatives we’ll be discussing are best […]
There are times when an investor finds themselves with a single stock holding that makes up an uncomfortably large portion of their overall portfolio. Having a concentrated position is a double-edged sword; on the positive side you’ve accumulated some wealth, but the problem is that your fortunes are now unduly connected to a single company. […]