Come on Jerome Powel…PIVOT!, Ep #100

What's up? It's episode 100 of Payne Points of Wealth. It's hard to believe it's been two years already! We've got unemployment still at the lowest levels in 50 years. We've got wages going up, and we've got an employment market that just won't cool off. What's the FED going to do? Will they finally pivot or are they ready to take this economy off a cliff? Are we going to a deep recession depression? We're going to give you our viewpoint on exactly how to play the economy, play the strong dollar, play the higher interest rates, play the conflict in Russia. There are so many issues, I can't name them all. On the Tipping Point we're going to talk about financial planning red flags. You're on your path to financial independence so what red flags do you need to avoid at all costs to make sure you stay on your path to reach your goals? 

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You will want to hear this episode if you are interested in...

• The FED pivot is coming sooner than later [1:37]
• What’s different and what are you doing to change it [4:27]
• Inflation is clearly coming down [6:23]
• The Tipping Point [9:36]
• Can you name all the investments in your portfolio off the top of your head? [10:37]
• How often are you in contact with your advisor? [14:23]
• Do you know how much income you need? [16:42]
• Hidden Facts of Finance [20:59]

A pivot is coming!

People keep saying everything's down. What we are seeing are mortgage rates up and housing prices up and even though they're down a little bit now they are still way up from where they were three years ago. Employment is up, the dollar is up, and interest rates are up. There are a lot of things that are up that we don't want to have up, but eventually, they will turn. 

Here's the thing, the market's been extraordinarily volatile, and reasonably so, sentiment is incredibly negative. If you're negative right now, you're in good company. It's one of the worst sentiment readings we've ever seen in history. It's all because of Jerome Powell. We're waiting for him to pivot. Will he? Eventually, sure. Look what happened the first half of this year, we went into a bear market and then July hit. We had one of the best months in the history of the stock market in the month of July because the market was thinking we were going to see a FED pivot. When it will come we don't know, but we're closer to it now than we've ever been. Keep the faith. Stay invested. It's coming. 

This week on the tipping point: Red flags to address in your financial plan.

Let’s talk about some of the red flags that we see week after week that you need to make sure you're addressing in your own financial planning.

First, can you name all the investments in your portfolio off the top of your head? If you can, chances are you're not very well diversified. Having millions in one target fund is NOT diversification. 

Another red flag, how often do you hear from your financial advisor? But more importantly, how often do you meet with your financial advisor to do your annual financial physical? If you aren't in communication with your advisor, you are not getting the advice you need to have the best portfolio for your unique needs. 

One more red flag for today. When it comes to your financial plan do you even know how much income you need? We find this is the baseline whenever we start the planning process. One of the first things we look at is just getting an idea of your expenses. No one likes to look at them because we know we all spend on things we shouldn't and we're afraid to see it. But man, oh man, it's so therapeutic to just get a clear idea of what you're spending on a monthly and annual basis. And from there you can solve a lot of your financial problems, but you've got to start there.

This week’s hidden facts of finance

• Europe is home to over 500 million people with GDP equal to 25% of the world's output in 2021. That's slightly greater than the US, which is about 24% of all global output and greater than China's 18%. You can't write off Europe.
• US energy exports to Europe surged to 43 billion in the first half of 2022. An increase over 190% from a year ago. The energy crisis getting real in Europe.
• Apple launched production of its new iPhone 14 in the India city of Chene. It is predicted a quarter of the world's iPhones will be assembled in India by 2025 up from just 3% today.
• The villa called Casa del Soul, a mansion built on Dubai's, Palm Jamira Island fetched 82.4 million when it was sold in July, the most expensive home ever to be sold in the Persian Gulf Emirate.

Resources & People Mentioned

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