Welcome to the Payne Points of Wealth: The podcast that addresses all the pain points that come with creating your wealth, growing your wealth, and sustaining your wealth. Hosted by the Family Wealth Experts of Payne Capital Management, Bob, Ryan & Chris Payne. On a weekly basis, they deliver timely strategies and solutions for the pain points that come with building, preserving and managing your wealth.
Episodes
Wednesday Nov 17, 2021
Wednesday Nov 17, 2021
What's up! It's episode 60 of Payne Points of Wealth! Hard to believe we're 60 episodes in! We've got late nineties stock market fever. Literally, everything is going up right now. We've got a huge melt-up. It's starting to look a lot like the late nineties when those internet stocks were just rocking. We're going to tell you why we think this is a lot like the late nineties. We'll hit on what you have to be careful about because there are bubbles forming, what you need to avoid in your portfolio and inflation. On the tipping point today, we're going to talk about financial sabotage. What are you doing right now that's sabotaging your path to financial independence.
You will want to hear this episode if you are interested in...
- Never seen a market like this [1:43]
- As good as it gets [5:25]
- The Tipping Point [9:50]
- Don’t allow your risk tolerance to fluctuate with how well your portfolio performs [12:11]
- Greed takes over fear [15:15]
- Hidden Facts of Finance [19:29]
Could it get any better for the economy?
Profits are extremely strong right now. Look at the third-quarter earnings, it's just been through the roof. Next quarter’s earnings are going to be good again too. We've got a hiring frenzy going on. Unemployment's coming down precipitously. We have all these people that have come off unemployment benefits getting back in the workforce and wages are going up. What's better than that. You're getting a raise at work, you have more money to spend and the fed isn't raising rates anytime soon, they're going to keep the party going. This is probably as good as it gets when it comes to the outlook for the economy.
This week on the tipping point: Financial sabotage
One thing that we've found managing all the accounts that we manage is a lot of times people put themselves in a position of financial sabotage. They make decisions that hurt them on their path to financial independence. So in this episode, we talk about some of the things that we find that people do that you need to avoid so you don't sabotage your financial life.
Don’t stalk your portfolio. Investing is hard, it's counterintuitive, when there's good news sometimes the market sells off. If there's bad news, the market goes up. It doesn't seem to make sense. If you're watching every day, checking your portfolio balance every day, it's a recipe for disaster. I can't tell you how many short-term focus investors have failed in the long run because they couldn't handle the pressure.
Don’t allow your risk tolerance to fluctuate with how well your portfolio performs. The whole idea of diversification is that you're going to have something that's not working. If everything's working at the same time, then everything will also be NOT working at the same time.
This week’s hidden facts of finance
Cryptocurrency, an asset class (if we want to call it that) younger than the iPhone is closing in on $3 trillion in market cap. That’s equal to about a quarter of the world's mined gold or the entire money supply of the United Kingdom. That's insane.
The resulting labor crunch has boosted wages and emboldened workers to fight for a better deal. Work stoppages in 2021 have already surpassed last year's 10 and it may be the start of a trend reversal. Work stoppages numbered 145 in 1981 dropping to 5 in 2009, it looks like unions could be back.
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Wednesday Nov 10, 2021
Wednesday Nov 10, 2021
What's up? It's episode 59 of Payne Points of Wealth and supply chains around the world are easing up. COVID cases globally are going down and profits are at an all-time record high as stock markets around the world are hitting all-time record highs. The question is, is it all going to fall off a cliff? Is this all too good to be true or is the economy going to continue chugging along? We'll look at some long-term tailwinds that could keep this economy moving into the roaring twenties along with your financial independence plan. We're also going to talk about those specific variables that you need to address in your financial life to make sure you're financially sound. You don't want to miss it.
You will want to hear this episode if you are interested in...
- A rockin’ market! [1:11]
- Everybody is doing well [3:36]
- Tailwinds for the economy [6:43]
- Don’t confuse brains in a bull market [9:03]
- The Tipping Point [11:07]
- Having a tax-efficient portfolio [13:21]
- How long do you expect to live? [16:11]
- How lucky do you feel? [18:19]
- Hidden Facts of Finance [21:23]
Economic tailwinds
There’s all this talk about how we're going to have a big burst of spending coming out of the pandemic and then it's just going to cool off again. Well, millennials are 25% of the population and are essentially going into their peak spending and earning years. Historically, the ages 45-55 tend to be when you spend the most money. You have household formation, kids, and more big-ticket items that you're buying. With the largest cohort of any population in America going right into that, it’s like the baby boomers back in the 80s', it’s going to lead to a lot of spending. Then you have this huge infrastructure bill coming down the line and when that passes that will be even more spending. Top all that off with the massive amount of inventories businesses are trying to build back up...doesn’t sound like a slowdown is anywhere in the near future.
This week on the tipping point: Customizable variables
When it comes to building financial plans for the families we manage here at PCM everyone's situation is a little bit different. So in this episode, we discussed some of the variables you need to customize for your unique plan.
When it comes to financial planning and your portfolio, sometimes we become more enamored with the value of the portfolio. Especially with our 360 portal where you can see how much you're worth. It's kind of fun as the market goes up to check and see how you did each day, week, or month—but it's not just about appreciation—you've got to have the income.
How much does your principal generate in income after taxes and inflation? It's so important to sit down with your advisor every year and look at what's important to you. What are your variables? What do you want to accomplish this year? Do you want to take a big trip? Do you want to give money to your grandchildren's education plans? Backing into those numbers is the most important thing to figure out how much income you're gonna need. Listen to the episode to find out which variables you should address.
This week’s hidden facts of finance
In the most recent quarter, Spain added 5.6 percentage points to its headline growth. French household spending jumped a whopping 21.5% annualized contributing to 10.5 percentage points to their growth rate. In fact, third-quarter growth results for the entire Eurozone outpaced the good old USA, well maybe not outpace as much as they're finally catching up because they're now playing out of the same playbook. They realize they've got to open their economies. It's not the end of the world. Spain, France, England, Germany, are all full of ordinary people, just like our country, and they want to get out and spend again. They want to live life! Europe is booming. The global economy is booming. We're seeing stocks go up all over the world so make sure you don't have all your money just in the S&P 500 because there are plenty of opportunities outside the US. Go global!
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Wednesday Nov 03, 2021
Wednesday Nov 03, 2021
What's up it's episode 58 pain points of wealth and profits this earnings season are phenomenal! Companies are beating estimates by a landslide. It doesn't matter that supply chain issues or labor costs are going up. It's all inflationary. But guess what? These companies just keep raising prices on you and me, which is making their profits go through the roof. So what does this mean between now and the end of the year? As the market continues to go higher are we going to finally get that correction in stocks that big sell-off that Wall Street has been telling us about? We're going to give you our vantage point, exactly what you should be doing strategically between now and the end of the year. On the tipping point today we're going to drop some wisdom on you. When it comes to your financial independence plan, we're going to give you some insights that you can apply to your portfolio, your financial plan, to get you on track, to be financially independent.
You will want to hear this episode if you are interested in...
- When’s the big drop coming? [1:24]
- Pipeline conspiracies? [3:41]
- The faults in being priced to perfection [6:49]
- The Tipping Point [10:39]
- Crisis is opportunity riding on a dangerous wind [11:15]
- A feather in the hand is better than a bird in the air [13:05]
- Accept something you cannot change and you'll feel better [14:43]
- A foolish man listens to his heart [16:33]
- Don't let statistics do a number on you [17:26]
- Hidden Facts of Finance [20:14]
Pipeline conspiracies?
It's amazing how the world changes, all of a sudden, how do we not have enough oil supply? The world's been awash in oil then all of a sudden it’s not?. I love a good conspiracy, and a lot of people are saying, or the “experts” are saying that the Biden administration is limiting production. I have a different theory on this. Perhaps there's just worldwide collusion going on. All the big energy companies are saying "You know what? We make a lot more money when oil is over $80 a barrel. Let’s just chill out on the production side of things. We will slow down on producing oil right now because when the price is at $30, that's terrible for profits." So I suspect there is big manipulation going on and I think it's all of these global oil companies who are very happy to slow down the production and keep those prices up!
This week on the tipping point: Financial Fortune Cookies
When you go to the Chinese restaurant nothing's better than getting that fortune cookie at the end and reading the wisdom within. Let’s open up your fortune cookie and apply it to your financial life and goals to be financially independent because there’s nothing funnier than getting a fortune cookie to help you run your portfolio!
Crisis is opportunity riding on a dangerous wind. Sounds great but it reminds me of what Warren Buffet says, it is wise for investors to be fearful when others are greedy, and greedy when others are fearful. We're emotional human beings. It's so easy to panic when prices are going down or when you have that fear of missing out and overload your portfolio on what's going up the most.
A feather in the hand is better than a bird in the air. I think the point is it's better to protect what you have than trying to reach for the stars and putting everything that you have at risk.
Accept something you cannot change and you'll feel better. I think right now is a perfect example of that. We have so much uncertainty about our taxes going up. Are they going to pass another $2 trillion in stimulus? Is the dollar going to be worthless in a couple of years? Is inflation just going to destroy our purchasing power? Is the dollar going to be so weak that we can't afford anything? The list goes on and on.
A foolish man listens to his heart. Don't use your gut feelings when it comes to investing. It's never right.
This week’s hidden facts of finance
Home prices are up a record 19.5% in the past year, according to Case Shiller data. However, home prices were removed from the official prices index, owing to political and statistical issues. If they were still included, inflation would be running at a 10% clip rivaling the early 80s'. It just goes to show you real estate is really inflated right now. Inflation is real and not transitory and if you've been listening to the Payne Points of Wealth Podcast you have known that for a year!
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Wednesday Oct 27, 2021
Wednesday Oct 27, 2021
What's up! It's episode 57 of Payne Points of Wealth and the all-asset melt-up is upon us! Everything is going up right now. Oil prices are surging to all-time record highs every single day. Bitcoin, all-time record highs. Stocks, all-time record highs. What should you be doing right now? Is this a big bubble? Can it continue? We're gonna break down exactly what's going on in the market. We're also going to talk about your financial independence. Do you have a date when you want to be financially free or retired? We're going to show you exactly how to pick that date, how to build that plan, and get you on track for your financial independence plan.
You will want to hear this episode if you are interested in...
- Bad, bad, bad...BS! [1:05]
- Economics 101 [3:44]
- Bitcoin confusion [4:58]
- Stocks are backed by real assets [7:44]
- The Tipping Point [9:40]
- Pick a date vs picking an amount [11:06]
- It's not just accumulating wealth, it's investing that wealth properly [13:26]
- Following emotional market whims [16:09]
- Hidden Facts of Finance [19:58]
Do you want to be punished at the pump or in your portfolio?
A year, year and a half ago, we had a -$37 a barrel print on oil. Why? There was no demand! The economy was shut down globally because of the pandemic. Nobody needed oil. It was sitting out in tankers in the ocean with nowhere to go. Now it's $85 a barrel. Why? Because demand is strong. The economy's booming, not just here but globally. When the economy does well, oil usage goes up. When you have supply and demand the price goes up. Guess what goes up with oil? The stock market. You want oil to go up, not because you want to spend a lot of money at the gas pump, but because you want to see your portfolio go up. So let's go oil higher, higher, higher!
This week on the tipping point: When is it safe to live off of your portfolio?
Let's talk about retirement. In this day and age, it's different. If you love what you do, you'll never work a day in your life as somebody once said. We think it's more important to think about financial independence and having a big pile of go-to-hell money, where you can decide to do what you want to do every day. A lot of times we talk about wanting to have X amount of money at a certain date. Whether it's a million dollars or 3 million, whatever that arbitrary number is.
It's more important to pick that date because for everybody that pile of money will be different. Maybe you have a pension, or social security coming in, what if you have an inheritance, so it really just depends on you specifically. So first you've got to decide l when is that gonna be? Is that five years from now, 10 years from now? If you're a millennial, maybe you want to take a break from working for a couple of years to travel and then go back to work. We have to solve for all of these problems, but you have to begin with the end in mind and that's picking that date before you think about the pile of cash.
This week’s hidden facts of finance
When Robinhood last reported quarterly earnings, the trading platform said it had 22.5 million funded accounts. The vast majority of those are considered active. Up 130% from a year earlier, that's a lot of people getting into the stock market. A lot of people are investing in the stock market for the first time and like everyone who starts out as a newbie investor usually they pick some very speculative ideas and end up losing money. So Robinhood is probably pretty appropriately named, taking money from the poor and giving to the rich wall street executives who don't care about you. At some point, they'll learn and give us a call.
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Wednesday Oct 20, 2021
Wednesday Oct 20, 2021
What's up! It's episode 56 of Payne Points of Wealth and earning season is upon us. For all intents and purposes, it should be a blowout again this quarter, company's profits should be through the roof. We have the banks reporting this week so far, JP Morgan's reported, BlackRock blew out the estimates. These are all good omens, but funny enough, investors are extremely bearish right now with plenty of cash on the sidelines, waiting for a correction. We're gonna address that today. We're gonna tell you what you should be doing with your money. How to play the next move in the market, how they'll play the rest of the year as inflation continues to kick in. Oil, it's over $80 a barrel! At a seven-year high! Folks. Inflation. Is. Real! It's here. We've been telling you about it. We're gonna talk about that. On the Tipping Point today we're going to talk about maybe you've done a great job saving for your financial independence plan, but what are you missing right now that you need to add into your plan to make sure that you're completely financially free. We're gonna break it down.
You will want to hear this episode if you are interested in...
- Everybody’s worried about…? [1:31]
- Is a melt-up coming? [3:07]
- A great example of how markets work [6:07]
- The Tipping Point [10:14]
- Too much risk is still risky[12:36]
- The ticking tax timebomb [15:56]
- It’s ok to live a little [17:22]
- Hidden Facts of Finance [19:57]
A real-life example of how the markets work
Here's a great example of how markets work. If you look at what we call the rotation trade—when growth stocks suddenly stop leading the market and value stocks pick up—all of a sudden financials, energy, these stocks are doing better. If you go back 12 months, you’d see that's when that transition started to happen. Long before anybody recognized it. Long before any advisors or strategists or economists called it. If you look back at the trailing 12-month numbers, energy is up almost 100% versus growth up just 20%. It's amazing how the markets are able to see these things months to a year ahead of time.
This week on the tipping point: Covering your bases
We've found that a lot of you that come to see us have done such a great job on the savings front. You've done a great job with your budget, you have minimal debt, you've learned to save, and you've built up a nice net worth. What we have found is that you don't always have all your bases covered. So, we thought we would talk about some of the problems you face, even if you're a diligent saver or if you have a sizable net worth at this point, that's getting you closer to that financial independence.
Number one on the list is having too much in cash!
When you're saving money, a lot of us think about saving money in cash. The problem with that is it's getting less than zero. If you think about your savings in terms of super savings, you want that money to work for you. Sitting in cash is like having a lot of employees that you pay, but none of them work. Check out the episode to hear what other bases you should be covering!
This week’s hidden facts of finance
This month the energy department released a study that says as much as 40% of US electricity could be produced by solar in 2035, 45% by 2050, but today solar only provides about 4% of overall energy. That's a gigantic leap, right? Renewables are the way of the future, but they're coming a lot later than everybody thinks.
Today it costs more than a penny to make a penny. According to the US Mint, it costs them roughly 1.70 cents per coin.
Warren Buffet, considered the world's most successful investor, made 99.6% of his 87.5 billion fortune after the age of 52. as much as 72 billion of his wealth came after he turned 65. He started investing at the tenure age of 11 and paid his first taxes at age of 13.
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Wednesday Oct 13, 2021
Wednesday Oct 13, 2021
Welcome back! It's episode 55 of Payne Points of Wealth and inflationary pressure is mounting. We've literally had the 10-year treasury up above 1.5% as central banks around the world are starting to indicate that they're going to start to taper and potentially raise interest rates sometime next year. In addition to that, we've got oil prices surging around the world right now, a natural gas shortage in Europe, and costs are going up because oil literally runs everything. So what do you make of the current economic environment? Meanwhile, we still have fighting on Capitol Hill as they're looking to spend trillions and raise taxes. It's a tumultuous time but we're going to give you the game plan you need right now to succeed. On the Tipping Point today we'll talk about how your financial independence plan is like having a great flight plan to make sure you can create the most secure financial situation for yourself. Don’t miss it!
You will want to hear this episode if you are interested in...
- Where are the corrections happening? [1:27]
- Mutating economy [4:26]
- Where the economists always get it wrong [6:53]
- The Tipping Point [10:30]
- Being prepared for turbulence [15:40]
- Hidden Facts of Finance [21:12]
A mutating economy bodes well for those in the ‘stuff’ making industry
We talk about the fear of this virus mutating. Well, we mutate. The economy, the global economy, it all mutates. We've changed how we do things and the economies are booming as a result of mutating away from the way things used to be done. Now, there are some near-term problems like supply chain disruptions. But if you're making stuff right now, if you have stuff in your inventory, you can charge whatever you want for it. What a great place to be. Those in the stuff manufacturing business aren’t sitting at home twiddling their thumbs, they’re working 24/7 to get more stuff produced and manufactured so they can sell it!
Meanwhile, all this has inflationary implications, but nothing like we had in the 70s’. We're going to have higher inflation, it will be a little stickier, but we will probably end up at 2.5-3%, nothing to be afraid of, but something you have got to hedge your portfolio for.
This week on the tipping point: Financial flight plans
Like anything in life, it's important to have a plan, especially when you're flying, you have to have a flight plan. Your flight plan will be dictated by what the weather's like, the winds, how many passengers you have, how much fuel you have to take. It's important before you take off to have a good idea of not only where you're going but how you intend to get there. That same principle applies to your investment portfolio. It's not about making the most money, it’s about getting to your destination as safely as possible.
The other thing about a flight plan is you're going to have turbulence along the way that comes out of the blue. That's what happens with the markets, like the pandemic, no one could have predicted it. It came out of the blue, the drop in the markets came out of nowhere. It's not how you react in the moment, it's about having that proactive plan ahead of time. You have to be prepared for turbulence in your portfolio. Most of you aren’t and you don’t even realize it. If the world falls apart tomorrow, you're not protected. That's why we always take your portfolio through that stress test.
Is your portfolio built and designed to get through that turbulence?
This week’s hidden facts of finance
The total value of US stocks is now over $51 trillion, a $16 trillion dollar rise from pre-pandemic values. To put that $16 trillion advance into perspective—it took over 200 years from the founding of the earliest US stock exchange in 1790 to the 2007-09 financial crisis for the stock market to create its first $16 trillion in value. Wow! So that's an amazing amount of money in the course of a very short period of time, during a pandemic and a global shutdown to boot! If there's any doubt as to where you should be investing your money, with a $16 trillion increase in just 18 months, sounds like the stock market is the place to be.
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Thursday Oct 07, 2021
Thursday Oct 07, 2021
It's episode 54 of Payne Points of Wealth and the FED finally admitted it! Inflation is not as transitory as they initially thought—as we've been telling on this podcast, week after week. Interest rates moved 20% last week and we're starting to see the bond market move...in the wrong direction! Supply chains around America are a mess right now! You can't hire enough truckers. You can't hire enough people to work at the ports. We're seeing a domino effect and huge delays on all products and services as they move slowly across the country. What does this mean for you? What does this mean for your portfolio? We're going to give you our view of exactly what's happening in the economy right now and what you need to be doing strategically. Money's moving out of tech stocks and into those old-school cyclical stocks that we love. In addition to that on the Tipping Point today, we're going to talk about your financial advisor. Are they really, really nice, but they don't give you good advice? We're going to tell you exactly how to handle that.
You will want to hear this episode if you are interested in...
- Supply chain problems causing trouble [1:32]
- Not just inflation on products [4:41]
- Shifting dynamics [7:49]
- The Tipping Point [10:54]
- Not having a full picture [13:02]
- Breaking things down so it’s understandable to you [15:41]
- Hidden Facts of Finance [21:37]
What’s wreaking havoc on the economy but not the market?
Companies can't find enough workers, even if the ports were open 24/7, there's not enough people to man them, there are ships sitting for weeks waiting to unload their cargo. When one part of the supply chain gets messed up, maybe a truck doesn't show up for a shipment on time, it just affects everything! It's just wreaking havoc on the entire economy right now. Inventory is running low, semiconductors are backlogged, steel and lumber are going up like crazy. People are building everywhere. Who knows what people will fill these homes with, maybe beach chairs and sleeping bags because you can't get any furniture or appliances.
With all of this going on, the market doesn't seem to care because here's the thing about the market... the market looks forward! All of this is priced in already. We are getting a little bit of corrective action, but that's primarily because the FED didn't say transitory last week, which means they are starting to believe—like we've been telling you—that inflation is going up. So interest rates are going up and hopefully, all of you listened because those bond funds are dropping like rocks! You have to get into fixed income, not bond funds.
This week on the tipping point: Nice advisors with bad service
Do you have a nice advisor who isn’t doing such a nice job? People are hesitant to make a switch for a variety of reasons. It seems easier to stay with someone because you have already made a time investment there, or they have handled so-and-so’s finance for years so they must be doing something right, or you’ve already moved from one bad advisor to this new bad advisor and it just seems like they are all the same so why bother.
We are here to tell you there are good advisors!
Good advisors are going to break things down into a simple way for you to understand it. Everything we're doing here is not rocket science, if it feels like rocket science, you've got a problem. Not only should you be able to understand what's in your portfolio, you should also understand how it relates to you and the goals that you're trying to achieve. Don't go with an advisor where you get mystery investments. Check out the segment for more on what a good advisor looks like!
This week’s hidden facts of finance
There are 13 US corporate tax hikes on record going back to 1925, and in the ensuing 12 months, the S&P rose 9 times averaging 11.1%. On the personal income side, Congress has hiked the top bracket 14 times and the S&P rose in the next 12 months after 10 of them averaging a whopping 16.8%. Sounds like raising taxes is actually good for the market. Who would have thought?
One of the biggest fears that clients have right now is that a tax hike is going to have a negative impact on the market but based on these statistics it sounds like that's probably not going to be the reality. I think the bottom line is a bull market is going to be a bull market, regardless of short-term moves and taxes. As we've said, we know money's got to go somewhere, better be bullish than to be foolish!
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify
Wednesday Sep 29, 2021
Wednesday Sep 29, 2021
It’s been a tumultuous week, with China Evergrande Group possibly going default on $300 BILLION of bonds. Is this going to be another Lehman event like the talking heads are saying?
We also have the Delta variant rising around the world and impacting the decisions nations are making regarding their societies and economies… and in the U.S., the government wants to raise money by taxing you. There’s a lot going on and it has investors spooked. What should you do with your investments, if anything? And how should you handle the risks involved in a time like this? Don’t miss this episode, we’re gong to provide you our insights for handing the risks times like this bring.
You will want to hear this episode if you are interested in...
- A leveraged Chinese Real Estate Company is not going to be of much concern to us [1:25]
- Stay on the boat even in downturns could be ahead, here’s why...[6:20]
- The Tipping Point: Risk — How are you set up to handle risk? [9:05]
- Hidden Facts of Finance [19:40]
Evergrande is huge in China but in the U.S. you don’t need to be concerned
100% of our clients never heard of this “Evergrande” outfit… that’s because we have no interest in ever getting involved in leveraged Chinese Real Estate companies. We’d be going from the Penthouse to the Basement if we did, and it’s just not what we do for our clients. The hype we’re seeing in the media is overblown and the correction that’s been forecast doesn’t appear to be happening as of this episode. Even if it did come about, corrections are almost always temporary. They are typically followed by a huge record high. Remember, it’s not rocket science, there are trillions of dollars out there driving the market higher. The real power is in having a diversified portfolio.
This week on the tipping point: RISK and Risk Management
One of the items we deal with day after day for our 2000 clients is risk. There are many types of risk to consider, including market risk. When markets go up and up and up… and honestly, that’s when you have the most amount of risk. But that’s not typically how people think about it. And on the converse, when the market is down is when you have the least amount of risk. So if everything in your portfolio is going up, that’s a bad sign. 1999 to 2000 is a great example, when the tech bubble was going up and up and up, and then the correction came hard. It took people 15 years to break even after that, so keep clear on your diversification objectives.
Another huge risk to consider is interest rate risk. It hasn’t been a huge risk lately because interest rates have been low, and when interest rates go up, bond funds go down. Even though bonds are touted as the most stable part of your portfolio, they can fluctuate in a time like this as much as 60%. That’s not stable at all. Listen to hear about the risk inflation and lifetime expectancy bring into the mix and more!
This week’s hidden facts of finance
The American public debt is ¼ larger than the economy and it’s grown substantially. Fed assets have grown 11-fold as well.
Corrections happen once every 17 months typically, but the only way to win is to be in. Don’t wait for the correction.
AMC Theaters attendance topped pre-pandemic numbers for the corresponding days in 2019. Definitely, the economy is reopening and it’s just getting started.
Listen to hear more of the hidden facts of finance that you commonly don’t hear and oftentimes, will shock you.
Resources & People Mentioned
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- See the hype about the On SpotifyEvergrande default
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- On Spotifyhttp://PayneCM.com
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Wednesday Sep 15, 2021
Wednesday Sep 15, 2021
Welcome back for episode 52 of Payne Points of Wealth. That’s one full year of musings from the Payne boys! We’re glad you’ve stuck around! Well, Labor Day is over and we are officially in the fall season! Cryptocurrency is apparently one of the primary currencies in El Salvador now. The world is getting crazy as always. We're starting to see a little bit of a slowdown in the economy. If you looked at the employment numbers that came out (while we're recording this), they came in weaker than expected. There's a lot of economists, a lot of strategists right now that believe we're going to an economic slowdown. We're going to give you the truth today. We're going to tell you what's really going on with the economy, and how to invest your money. On the tipping point today, we're going to play a little bit of financial jeopardy. We're going to talk about some financial terms you need to understand if you're going to get on your path to financial independence.
You will want to hear this episode if you are interested in...
- Does the market have to go down just because it’s September? [2:07]
- Big bubbles [5:20]
- The Tipping Point [9:03]
- What’s known for high fees, lack of liquidity, and misleading promises? [9:43]
- What requires an advisor to put a client's best interests first? [11:34]
- What phenomenon is eminent but no denying that it will be back eventually? [13:20]
- What forces retirees to drain their retirement accounts [15:38]
- Hidden Facts of Finance [18:56]
The most powerful force of monetary and fiscal policy we've ever seen
There's been $32 trillion of fiscal and monetary stimulus created since the pandemic started. $32 trillion! All the global GDP in the world, every year, is something like $93 trillion. Think about how supercharged the entire global economy is right now. It's basically on steroids. It's almost laughable that any economists or strategists would think we're going to get some sort of real sell-off because you're fighting the most powerful force of monetary and fiscal policy we've ever seen. Literally ever! That's why we're going to have big bubbles in certain areas of the economy. We have big bubbles going on right now. You just don't know when they're going to burst.
This week on the tipping point: Financial Jeopardy
In this episode, we play our own little game of Financial Jeopardy and talk about some critical financial terms that all our listeners really need to understand. In the spirit of Jeopardy, we're going to give you the answer and you're going to follow up with the question. Check out the episode to see if you got it right and to hear what the Payne men have to say about it.
#1 It's known by many for its high fees, lack of liquidity, and misleading promises. This financial product gives the financial services world a bad name.
#2 This requires a financial advisor to put his client's best interests before his/her own. Unfortunately, not all financial professionals are governed by it.
#3 This financial phenomenon is thought by some to the eminent and by others to be far off in the distance, but there's no denying that it will be back eventually.
This week’s hidden facts of finance
As of early August, global equity funds have seen 605 billion of inflows year to date. Now to put that in perspective, global equity funds have seen 727 billion of cumulated inflows over the last 25 years. Therefore in 2021 alone, there have been 40% higher inflows than the last 25 years combined. That's insane. If that's not a melt-up, I don't know what is.
The US population increased 0.4% in 2020 to 329 million Americans marking the slowest growth rate since 1901. A falling birth rate and an aging population could portend major implications for our economy long term. You've got an aging population then fewer people going into the workforce means fewer taxes and more people for the government to have to support. Maybe people should probably start having more kids.
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
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Wednesday Sep 08, 2021
Wednesday Sep 08, 2021
This is episode 51 of Payne Points of Wealth. You can't stop this market. We can't stop this market. The market is literally at all-time record highs every single day. We've got some news from the FED signaling that they're not going to raise interest rates anytime soon. A very bullish time which means the world's going to stay washed in cash. The Delta variant of the coronavirus seems to be slowing down a little bit, as we're recording this. Giving us some light at the end of the tunnel with what's going on with the economy. We're going to talk about what we see, what's going on, and where you should invest your money. On the tipping point today, we're going to talk about literally every age of your financial life, whether you're 20, 30, 40, 50, 60. What you need to be thinking about at every stage of the journey to make sure you're going to be financially independent.
You will want to hear this episode if you are interested in...
- Record highs & a re-rotation [1:20]
- Pop quiz! What is the best performing asset class over a 100 year period? [3:31]
- The market isn’t in the now [5:54]
- The Tipping Point [11:11]
- When you’re in your 20’s [11:45]
- When you’re in your 30’s [13:58]
- When you’re in your 40’s [15:56]
- When you’re in your 50’s and beyond [17:41]
- Hidden Facts of Finance [23:18]
This week on the tipping point: Investing over a lifetime
Financial planning is a journey, not a destination. Here at Payne Capital Management, we've found that each age represents an important landmark as it relates to your financial independence. What should you be thinking about at those different stages of your financial journey? Here’s a quick look, but listen to the episode for a full breakdown!
Your twenties are the hardest time to invest because you're trying to buy big things like a car or a house, and you're just starting out in your career. But, it's the best time to get into the habit of automating your savings. Small investments in your 20s will pay off BIGTIME down the road.
In your 30s you typically start to create a little more wealth. You're a little further along in your career, money starts to get bigger, and the decisions you have to make get a bit more serious. You’ll want to have a plan not just for your creation of wealth, but also for the preservation of wealth. You should also create an estate plan, you want to have a will when you're in your 30s.
When you get into your 40s, the stakes only get higher. This is when you should start thinking about streamlining your finances. You may have a couple of 401k plans from different employers. Perhaps an advisor who's giving you advice on your IRAs, maybe a brokerage account with somebody else. Consolidating all those finances and getting a streamlined game plan is the key when you get into your 40s.
Your 50's are what we call the financial red zone. It's a time where you're able to maximize your contributions. Sometimes you can't do it when you're younger, so in your 50's, you want to make sure that you catch up with everything and that you're prepared for the day where you're not going to have that paycheck coming in.
In your 60's you're retired or getting close. Your 401k or retirement plan is likely a huge part of your net worth. The nice thing is if you're 59-1/2, for a lot of plans, you can do an in-service distribution. You can roll the money out of the plan with no tax, put it into an individual retirement account for yourself, and invest in a more customized way. You'll also want to start looking into things like Roth conversions because at age 72 you have to start taking money out of those pre-tax accounts.
This week’s hidden facts of finance
If the US taxes all Americans at 100% there will still be an $8 trillion federal budget deficit. I think our deficit is a problem. What an inconvenient truth! If they confiscate all the billionaires' money today, we won't even meet the current spending proposals. That's very unfortunate when you run out of billionaires. If the billionaires don't have any money to pay the taxes, guess who they'll be coming for? Taxes are going higher. So do your tax planning this year. Don't wait.
Resources & People Mentioned
See if you qualify for a complimentary financial review from the Paynes
Connect With Ryan, Bob, and Chris
- http://PayneCM.com
- Follow on Twitter
- Follow on Facebook
- Follow on LinkedIn
- Subscribe on YouTube
- Follow on Instagram
Subscribe to Payne Points of Wealth
On Apple Podcasts, On Google Podcasts, On Spotify