Payne Points of Wealth
 

Payne Points of Wealth

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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

Trading One Uncertainty for Another, Ep 13

Thursday Nov 12, 2020

Thursday Nov 12, 2020

We are finally past the election so we can put that worry behind us... and pick up a new one. As the economy continues to open we’ve seen reports of a spike in Coronavirus cases. Reports have come in about countries in Europe, like France and Germany, starting to lockdown again. The uncertainty has shifted to how we are going to keep reopening the economy. However, if you look PAST those headlines of “Europe Shutting Down” you will see that schools are still open, you can still get a haircut, it’s not the kind of lockdowns we faced in March, it’s more like lockdown lite! Listen to the episode for the full story and loads of other great info!

 

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

  • The news in plain sight [0:33]
  • The certainty of uncertainty [1:46]
  • Necessity is the mother of invention [3:23]
  • What’s going to drive stocks higher? [5:12]
  • Dividends are going up! [6:40]
  • The Tipping Point [8:53]
  • How do you get money in the market without being all or nothing? [11:23]
  • Have a trusted advisor to rebalance your portfolio [14:03]
  • Building your Arc before the flood comes [16:16]
  • Hidden Facts of Finance [18:21]

 

More signs of a recovering economy 

Stock dividends are going up. Income's going up. It’s like every company is saying, “Hey, our picture looks good for next year. We're comfortable paying out some of our profits now.” They weren't comfortable with that just a couple of months ago. We think that's a vote for the future! If you're comfortable paying out your profits, that says your future looks pretty good. 

A stat we came across recently shows 1.5 million businesses formed in the last quarter. That’s 80% quarter over quarter. That means that as we're coming out of this recession, businesses are getting started. People are looking for opportunities and they're doing it on a huge scale and that has to bode well for the economy next year, and just looking forward to it in general.

 

This week on the tipping point

Trying to pick individual stocks is like trying to pick the winner in a beauty contest. Your definition of beauty doesn't determine who the winner is. You may think that one candidate is better looking or more talented than another candidate but only the judges’ opinions matter. If you're going to pick the winner of a beauty contest you have to figure out what the judge's view of beauty is. Figuring out what the judges think is the same thing as picking stock in the market. It's not about picking good companies, it's about figuring out what the judges— the people that are buying stocks— want and what THEY consider good companies. And you know what, unless you can read people's minds, you might as well just go to the racetrack. Check out this awesome episode to hear more!

 

This week’s hidden facts of finance

US online holiday shopping is expected to grow 33% this year up $189 billion! Amazon plans to hire 100,000 temporary workers for the holidays. That’s a good reminder job growth follows economic growth. Amazon tripled their profits last quarter and based on their conference call, they expect the fourth quarter to be even bigger. It just goes to show, you can never discount the American consumer. The sun rises in the East—mom and American spend. Listen to the segment for more interesting facts!

 

Resources & People Mentioned

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Market Change is No Respecter of Election Results— It’s Coming Regardless, Ep 12

Thursday Nov 05, 2020

Thursday Nov 05, 2020

Maybe it’s time to get into cash, wait this thing out, see what happens. Then when cooler heads prevail make some investment decisions later...what do you think?

By the time you listen to this, the election will have taken place but it may not be over. The volatility caused may still be lingering as well. We just hope you aren’t sitting around— in cash— waiting for the perfect time to get back in the game only to miss the biggest melt-up of the decade! We hope you’ve been listening as we’ve told you to stay in so you don’t miss the big move. It can happen in an instant and if you aren’t in when it comes you’ll never make it up! You have to keep the long term goal in sight. Join us this week as we talk about this and more and perhaps have a few (much needed) laughs along the way. 

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

  • Have we been wrong all along? [0:46]
  • Where’s the bigger risk? [2:38]
  • Things people aren’t paying attention to [4:22]
  • Something we hear time & time again [6:22]
  • Investing in next year...today [8:06]
  • 5 days equals 30% of a 50 year period [9:26]
  • The Tipping Point: Now or Later? [10:11]
  • Have your people talk to...YOUR people [12:30]
  • To debt or not to debt [14:28]
  • Are you up to date? [15:56]
  • The perfect estate plan [18:05]
  • Hidden Facts of Finance [19:33]
  • We HAVE been here before and it led us to the roaring ’20s [21:27]

Sometimes you don’t see things you aren’t looking for

There are some things happening that aren’t getting attention. Everyone is really hot on the Teslas of the world but they aren't talking about things like small caps— which have started to do really well. There many things in different areas in the market that are improving and people aren't paying attention. A lot of people don't realize that China made a new high last week. The focus is on the S&P 500 and there’s a recovery happening around the world that’s being missed.

This week on the tipping point

When it comes to making decisions on your financial plan, sometimes it's more beneficial to defer action other times it's critical to address something right away. How do you know when to do what? In this episode, we discuss some different financial matters and decide if it's good or bad to put them off. 

One example. If you're saving in your retirement accounts— your 401ks or 403B's— you're putting money in pretax, so you are deferring taxes. The problem is eventually when you're 72 you have to start taking it out THEN it becomes what we call a ticking tax time bomb. Those required minimum distributions could potentially push you into a much higher bracket making it a very tax-inefficient portfolio. If you're a younger investor, you might want to look at that Roth 401k option where it's after-tax. The beauty in a Roth 401k, or some other Roth account, is that all that growth is tax-free later. Listen to the episode for more examples! 

This week’s hidden facts of finance

You’ve probably heard people voice concern about this pandemic because we've never in history had to deal with something like this. However, the fact is we have! We had the Spanish flu in 1918, 1919, & 1920, last checked— there's NO vaccine for the Spanish flu. How did our economy recover then? How did the world recover from the Spanish flu? We don't really know, but we do know it recovered, we know we have been here before. To top that off the 1918 Spanish flu was followed by the roaring ‘20s, one of the greatest economies in the history of the planet! Something to look forward to? We think so!

Resources & People Mentioned

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Market Irony and Where You Don’t Want to be When the Melt Up Happens, Ep 11

Thursday Oct 29, 2020

Thursday Oct 29, 2020

It seems week after week it's the same story. A lot of uncertainty out there. Most Wall Street strategists have been negative and wary. Bob, Ryan, and Chris had been very bullish and the market continues to go higher. Bob, Ryan, and Chris continue to be right while strategists continue to be wrong. What's going on? 

There’s a fog of uncertainty that seems to be shadowed by the fact that earnings are starting to get strong. In truth, of the 10% of the S&P companies that recently reported their earnings, 86% topped the consensus expectations. Even though the analysts and the economist continue to be pessimistic we’ve had good economic numbers on a weekly basis and quarterly earnings are off to a phenomenal start. Listen to the episode for more info.

 

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

  • The news in plain sight [0:35]
  • Is economic growth picking up? [2:04]
  • Elections affecting pullbacks in the market [3:49]
  • Reality... [5:03]
  • Something stocks love [5:54]
  • The irony of right now [7:02]
  • The Tipping Point [9:05]
  • Why we’ve never had a client hold a bond fund [12:52]
  • The best advice you can give anybody right now [13:53]
  • 900 times forward earnings! [15:54]
  • Hidden Facts of Finance [18:06]
  • Past performance doesn’t tell you what will happen going forward [19:53]

 

Don’t miss the melt-up because you were sitting in cash

The great irony right now is that you may think that by going to cash you're playing it safe, but in reality, what you're doing is risking a huge melt up to the upside. Because of low-interest rates and de-urbanization the housing and automobile markets are growing like crazy. We've been talking about this trend a lot. In New York City people are leaving and going to the suburbs. Then they need to buy a car, so car sales are up 50% in the last couple of months. So that part of the economy is already cooking. 

What if we start to travel again on top of that? It's almost like it's going to be the economy on steroids versus where we were in January pre-pandemic. We’re really scared to miss the upside here and investors should be too. You shouldn't be worried about another big sell-off, which could happen, but realistically we probably won't see one as we did in March. But what you want in on this year is a huge melt up to the upside. If you miss that move, if you miss that return, that's basically your next decade of move in stocks. If you want more on this topic and more check out this episode of Payne Points of Wealth!

This week on the tipping point

The best advice we can give right now is that the #1 thing you need to know— the only true hedge in any portfolio— isn't gold, it isn't buying puts, it isn't trading the market. It's owning high-quality bonds that have a fixed rate of interest and a maturity date. That’s the only hedge we’ve ever seen in 45 years that works, and it works every single time. You want to protect your principal owned bonds that have a fixed rate of return and maturity date and make sure they're high quality. And be sure you have someone who knows what they're doing to be certain that they're high quality! Listen to the tipping point segment for more great tips!

This week’s hidden facts of finance

The best performing stock’s past performance is 100% indicative of… past performance. It doesn't tell you what's going to happen going forward. When a stock goes up 100% it typically doesn't go up 100% the next year. At one point this year, before its stock tumbled, Nikola was worth more than Ford Motor’s $30 billion market capitalization. It now trades at 7.4 billion. The biggest difference between Nikola and Ford is that Ford actually has earnings. Just to remind everybody of the risk in the market, you could have purchased Nikola stock at 80 in June and it’s 20 today.

Resources & People Mentioned

See if you qualify for a complimentary financial review from the Paynes

Connect With Ryan, Bob, and Chris


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On Apple Podcasts, On Google Podcasts, On Spotify

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Projecting a Market Future Based on Personal Experience, Ep 10

Thursday Oct 22, 2020

Thursday Oct 22, 2020

The real loss in the market is when you succumb to your emotions. There are many markets and they are all affected by different situations. None of them ever drops to zero, even though that seems to be the driving fear behind so many decisions to get out instead of staying in for the long haul. Listen to this episode of Payne Points of Wealth to hear more on how to combat this fear and many more valuable tips. 

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

  • Why the market doesn’t care what everyone else is worried about [1:22]
  • Secret indicators nobody knows about [3:08]
  • Things that aren’t being talked about [5:46]
  • Being smarter than your DNA [8:14]
  • The tipping point [10:10]
  • A picture that saves you 3000 words [13:30]
  • Fear of no control [17:55]
  • Hidden facts of Finance [19:50]
  • The death bell ringing at the movies [21:36]
  • The superpower that isn’t growing [22:12]
  • The second biggest total on record for the worst thing you can own [24:39]

 

Opportunity is calling… are you listening? 

We are all human beings and we project a future based on our own most recent experiences, on the other hand, the stock market never looks back. It’s always moving forward. Always pricing in what’s coming months and years down the road. The market tells you every day where the opportunity is. The question is… are you listening? Check out this episode for a wealth of tips on how to be a better listener!

This week on the tipping point

Should you have an exit strategy if things get bad? What if there is a sell-off between now and the end of the year? We think you have to be comfortable with a couple of laws we call protecting your portfolio against downturns. A big part of that is bear markets, it's not that uncommon and it's going to happen over time. Markets go down, but they also go up, it doesn't mean you have to get in or out. Overcome the fear that arises from negative news by not putting all of your money in one place— be diversified! 

You don't want to bet it all on one situation, you want to have an ALL situations portfolio. That way no matter what happens— whether the market goes up or down— you have something that can benefit or something that can protect you. Listen to the Tipping Point segment for the full story and the answers to the questions above.

This week’s hidden facts of finance

The outcome of the US election doesn't matter to most Chinese companies whose ownership and business operations are largely domestic. Over the last six months, we’ve heard “I don't want a Chinese company in my portfolio” or “I don't want a company that does business with China, in my portfolio” so we made a list of stocks they can own— there were none! 

If you have a portfolio of domestic companies and you own a great American company and the CEO gets up and says there are 1.4 billion potential customers for our product. But because you requested not to do business with China, we're not going to sell anything to those 1.4 billion customers, we're going to let our competition do it. I'll tell you what I'm doing that day. I'm selling that stock and buying the stock of the competition. Check out the segment for other random facts!

Resources & People Mentioned

See if you qualify for a complimentary financial review from the Paynes

Connect With Ryan, Bob, and Chris


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On Apple Podcasts, On Google Podcasts, On Spotify

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If You're Sitting in Cash Your Biggest Risk is the Cost of Opportunity, Ep 09

Thursday Oct 15, 2020

Thursday Oct 15, 2020

If You're Sitting in Cash Your Biggest Risk is the Cost of Opportunity, Ep 09

Politics still have things stirred up but the market seems to be handling it better than people are. Use this volatility as your ally because it seems like fear versus market action is disconnected right now. Just because YOU think the market is going to drop due to election results (whatever they may be) doesn’t mean it WILL. 

Never discount the American consumer's ability to spend money. It’s not smart to bet against it. What happens when we get a vaccine or when we get comfortable again? People start traveling, taking cruises, and flying again. The lockdown economy made a ton of money while everyone was in solitary confinement but what about the un-locked-down economy? It's about to boom again. No matter who's in office. Tune in to this week’s episode for the full scoop on this and more!

 

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

  • News in plain sight: POTUS & FLOTUS’ covid effect on the market [0:39]
  • Your political bias and your portfolio [1:45]
  • Are things going to hell in a handbasket? [3:40]
  • What’s driving the economy? [5:03]
  • Will consumers start to spend again...did they ever stop? [7:24]
  • The Tipping Point [10:53]
  • Holding stock in the company that cuts your checks… is it a good idea? [15:52]
  • Hidden Facts of Finance [21:30]
  • Old school over new school in gains [28:06]

 

Appreciation isn’t the only return

A big thing that people miss in terms of a portfolio of investments is that the return comes not only from appreciation but also from income. When you have a portfolio of high-quality bonds— and you should ONLY own high-quality bonds— and you also have high-quality stocks in that portfolio, you're actually making money every day. People have these buy low and sell high ideas and that's garbage! Stay invested! A better way of looking at it is to get paid while you wait for your money to double. That's the way you should look at it. What it comes down to is your biggest risk is not the election, it's that person you look at in the mirror every day. It’s their political convictions that are getting in the way and stopping you from being a good unbiased investor. If you miss a big move up in stocks, you never get that return back and if you've already missed the summer melt-up, don't miss the next move up too! Stop sitting in cash, get in, and stay in!

This week on the tipping point

Vanguard released its annual report called How America Saves, with several interesting facts about the investment world. Studies showed that 78% of investors use target date funds in their 401k with 54% using only target date funds. Another interesting fact is that 74% of all Vanguard 401k plans offer a Roth option, but only 12% of participants in those plans had elected the Roth option. The last stat we want to mention is that in the 10 years between 2010 and 2020, the number of people holding company stock in their 401k dropped by 16%. What might be the reason for this? And would you consider it a positive trend? You’ll want to catch the episode to get our thoughts— good, bad, and the ugly— on these stats. 

This week’s hidden facts of finance

Ball Corporation recorded the lowest coupon ever for a junk bond with a maturity of five years at 2.8, seven 5% in August. The Double-B rated market, AKA junk bonds, is about 55% of the high yield bond market. As of the end of July, bond buyer beware. When you look at bonds and your portfolio, you want to have two things… you want to have a bond that comes due and you want to have a fixed coupon. Well, this bond does have a fixed coupon of 2.875%, but it may not come due. The problem with junk is that they can go out of business. They have a higher probability of failing. When you invest in bonds you want safety. Returning your money's important return of your money is paramount. Listen to the full segment to hear the rest of our hidden facts of finance! 

Resources & People Mentioned

See if you qualify for a complimentary financial review from the Paynes

Connect With Ryan, Bob, and Chris


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On Apple Podcasts, On Google Podcasts, On Spotify

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Uncertainty Continues With Talk Of An Economic Stall And An Impending Second Wave, Ep #08

Thursday Oct 08, 2020

Thursday Oct 08, 2020

As headwinds continue to blow, uncertainty continues to be at heightened levels. What we're hearing and seeing is everyone feeling like the economy is starting to stall. That we've had a V-shape recovery and there's this consensus out there that maybe it's over. Top that with an impending second wave of the pandemic as the weather gets colder and the question we are getting over and over again is… Is it time to cash out before the election? Is the economic rebound finally over? Do you think that means that everybody's thinking the same thing at the same time? Could that also mean that the market may have already priced in all this news? Join us on this episode of Payne Points of Wealth to find out. 

>>>>>>>>>>>>>.PLAYER GOES HERE<<<<<<<<<<<<<<<<<<<<

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

  • The housing market BOOM [2:45]
  • The second wave of the pandemic & a vaccine [4:59]
  • The market never goes down on the same news twice [5:41]
  • Your portfolio in a volatile time [7:04]
  • The tipping point: Strategy games [9:26]
  • Our experience with timing the market [10:41]
  • Money saved in taxes and a ROTH [13:22]
  • Playing stock roulette [16:26]
  • Hidden facts of finance [19:48]

Let’s give them something to talk about… housing!

What we think more people should be talking about is housing! Here we are in the middle of a recession and housing is booming. Let’s put that in perspective, Dow Jones U.S. Home Construction Index is up 120% since the March low and the S&P 500 is only up about 50%. Housing is clearly outperforming the market. It's soaring. Rates are ridiculously low, so much in fact that some people that would normally buy for cash are borrowing and making more in their portfolio than they are spending in interest. 

There are still parts of the economy that aren't doing well, like restaurants and hotels. But every job that you get in housing has big-time multiplier effects. Think about this… you buy a new home in the suburbs, then you go to a home improvement store, or you need a new appliance, or you put in new furniture, so there are many different parts of the economy affected by this positive multiplier. There are parts of the economy not only booming but having a multiplier effect that offsets a lot of the losses in other parts of the economy. 

The strategy game on this week’s tipping point

In our collective 70 years, we have probably have seen every financial strategy under the sun. What we know is some financial strategies work, some don't work at all, and some kinda work. You can relate it to different games like roulette, which is basically no skill at all, chess where it's all about skill, and poker where there are elements of both. No matter your strategy we can all agree that going to Atlantic City or Las Vegas and gambling a little can be fun. But when you're putting your entire future and your entire net worth in that gambling strategy it’s dangerous and can be detrimental to the long-term financial health of you and your family. Listen to this week’s tipping point to get our take on this strategy game. 

This week’s hidden facts of finance

Around 85% of our energy needs are currently satisfied by coal, oil, and natural gas. The energy sector might be in one of the best buying opportunities of our lifetime. 

Exports to the US amount to a mere 3% of Beijing's gross domestic product. We're still their biggest consumer at about 16.8% of total overall exports. That’s three times higher than their second-biggest receiver, which is Japan.

The average TV bought in North America now has a 50” display at a price of just $360. TV's are a notoriously low-margin consumer electronics business. 

China’s national railroad corporation unveiled plans to more than double the length of its high-speed railroad network— already the world’s longest— to more than 70,000 kilometers within 15 years. It will connect China's largest megacities. 

See if you qualify for a complimentary financial review from the Paynes

Connect With Ryan, Bob, and Chris


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Volatility & Uncertainty are your friends… dressed in a mask trying to scare you to death, Ep 07

Thursday Oct 01, 2020

Thursday Oct 01, 2020

Volatility & Uncertainty are your friends… dressed in a mask trying to scare you to death, Ep 07

The real story this week is that election uncertainty is upon us! You're hearing more and more news about how the election will affect the markets. Contributing factors causing volatility are the recent death of a supreme court justice, tension in the political realm, riots going on in different cities, all the while we are STILL in the middle of a pandemic. What else could go wrong here? The big question on many investor's minds this week is should I... Stay in cash? Get invested? If I am invested, is it time to go to cash and just wait for this thing to blow over? Listen to the episode to get our take on the answers to these questions! 



>>>>>>>>>>>>>.PLAYER GOES HERE<<<<<<<<<<<<<<<<<<<<

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

  • Where is the worst place to be right now? [1:15]
  • When can you expect to get good prices? [4:02]
  • Betting on the reopening of the economy. [5:59]
  • What would Warren do? [6:43]
  • The tipping point: How to recover from recession missteps. [8:03]
  • Have you been ignoring your finances? [10:01]
  • What kind of fees can you lower in your portfolio? [11:38]
  • Getting your financial physical. [14:54]
  • Hidden facts of finance: Russian vaccines, dividend yields, & bonds, oh my! [16:25]



Uncertainty creates a great buying opportunity

You don't get good prices when there's a lot of certainty out there. When people are feeling good about the markets is when the markets are sky-high. It’s when people are jittery that you get those low prices. That’s when you get great discounts in the market, creating great buying opportunities. As the saying goes, you can't get good prices without bad news. And that's certainly what's happening right now. 

This is really the bane of the investors’ existence, having to embrace uncertainty in the market. Historically when things are the most uncertain you’ll find the best buying opportunity. Yet, we want to wait for clarity, for the sky to part, and the sun to come out so we feel good. Of course, that's always the worst time to invest because good news comes with bad prices. Take advantage of these dips because you don't get them that often. 

Recovering from recession missteps on this week’s tipping point

Today we will talk about some of the recession missteps made and how to recover from them. What do you have to do now to get back on track and back on your path to financial independence? We think one misstep people made was selling out of the market when it went down, and now they’re sitting in cash and have no reentry plan. What do you do next?

The way to look at that is there's not just one market. There are multiple markets around the world. So there's plenty of opportunities to get in at a low cost. The thing is you have to make the conscious decision to get back in and then stay in. The dilemma is when you get out at 100% you're making a bet. If you get all out then you need to make another 100% bet to get back in. And that's what we call all or none. And an all or none position is always a terrible place to be when you're an investor. Listen to the episode to hear how you should diversify when you are buying back in. 

Stock dividends are the place to be on this week’s hidden facts of finance 

The Russian vaccine called Sputnik 5 has only gone through phases one and two and it's been sent to Venezuela and Nicaragua for phase three trials on people who aren't Russians. That sounds safe! 

Talk about dividend yields! The common shares of ATT now yield almost 7%. That's amazing and about twice what the telecoms long term bonds pay. JPMorgan's developed market global government bond index currently yields 1.3%, but the longterm 44-year average is more like 6.4%. It seems that stock yields are better than bond yields these days. You wouldn't want to sit in cash getting 1% and it doesn't sound like developing market yields are much better. Stock dividends are the place to be.

See if you qualify for a complimentary financial review from the Paynes



Connect With Ryan, Bob, and Chris


Subscribe to Payne Points of Wealth
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Zero-commission Trading Platforms...Stock Market or Casino of the Pandemic?, Ep 06

Thursday Sep 24, 2020

Thursday Sep 24, 2020

In pandemonic times, zero-commission trading platforms have become the casino of Americans who are cooped up at home. Companies like Robinhood are offering zero-commission trading, making people less hesitant to trade. That combined with the fact that alcohol sales are up 14% since the beginning of COVID and a 92% increase in options trades this year leads us to think there may be a lot of people making some questionable trade decisions.

Sitting at home without the typical legal gambling outlets the stock market seems to have become the place where huge bets are being made by those looking to satisfy their gambling fix. At the casino, you put money on the table — that’s what buying a call option equates to — putting money on a table and hoping for a return. Options trading is challenging and not something the average investor should try to tackle on their own. Following trends isn’t investing it’s speculation. In a game of speculation, the house is more likely to win, so I guess our advice today would be don't drink and trade and stay out of the casino. Hopefully some good will come out of this though and people will start to understand investing and jump in for the long haul by buying individual stocks or index funds because that’s where the REAL money is made. 

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

  • Drinking options...oh, wait we meant options trading. [0:39]
  • Tech bubble talk. [3:01]
  • “Paradigm shift” [4:25]
  • A huge consequence of concentrating your money in one place. [5:08]
  • Questions to ask yourself? [7:24]
  • The tipping point: Investment hearsay. [9:00]
  • When it comes to financial planning what’s best for you? [14:39]
  • Hidden facts of finance: Retail blues. [18:37]

Tech bubble, same old same, or something different this time?

Let’s talk tech bubble... again...it’s prime time in the news when talking about financial markets and what we are hearing is that it is different this go around. That it’s not the same as the tech bubble of 99-2000 when there was this big proliferation of cheap online trading sites, doctors and lawyers were quitting day jobs to become day traders, and you had this belief that there was this new economy. But wait… doesn’t that sound a lot like 99-2000 after all?

When it comes down to it you have to ask yourself, is mean reversion still a thing, or are those lofty tech valuations eventually going to come back down to earth. You should also question whether or not you believe we're going to beat this virus? Is the economy going to reopen again? If it does are all those stocks that are benefiting from lockdown going to be great long-term buys. As the economy picks up and grows, as we go out, drive more, and fly more, as we go back to our normal routines how will that affect the market? What stocks are going to benefit from that? Or is this new normal going to last forever? If history has taught us anything it’s that nothing lasts forever. 

Investment hearsay is this week’s tipping point

What’s the pain point that has the biggest impact on your wealth right now? When it comes to investing your money and financial planning, we think it’s “investment hearsay”. People love to give blanketed advice. Even if they have no credentials and no professional background. They feel like it's okay to give unsolicited investment and financial planning advice and it gets consumed like it's actual gospel. We think it's really dangerous. You get this advice from cocktail parties or maybe someone very confident about how they invest their money, and a lot of times it's just completely WRONG. Are you getting dangerous advice from unqualified people?

Retail blues on this week’s hidden facts of finance 

This week’s hidden fact is all about “retail blues”. Twenty-four(24) retailers have filed for bankruptcy from Jan - July 16, 2020! That’s more in half of this year than all of 2019 combined. We are also looking at as many as 25k stores closing in 2020 vs 9832 in 2019. This has a great deal to do with the pandemic but it’s also due to online retail. 

Zoom stock has zoomed up 465% in 2020 is now worth more than a hundred billion dollars. Peloton has a market cap of 25 billion after gaining 209% this year, as its stationary bikes replaced gym memberships. Netflix stock is up from $1 to a close of $500, adjusted for splits, since its debut less than two decades ago. 

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Is Tech On The Way Down Or Is This Just A Correction? Ep #5

Thursday Sep 17, 2020

Thursday Sep 17, 2020

Over the past week, we’ve gotten calls from long-time clients who are asking us what sounds like a reasonable question: “Why are we not putting ALL my money in these growth stocks that keep going up?” As we said, it SOUNDS like a good plan, but it’s based on a wrong understanding of how the market works. When stocks are high — and most of the stocks in the current growth stocks are so high they are overvalued — you don’t want to buy them. Buy low and sell high is the motto of savvy investors.

Ryan likens the markets over these past two weeks to a massive casino. Traders have been basing their trades on the most recent happenings in the market — tech stocks that keep going up — so they try to ride that train even further. But this week, the train hit the brakes a bit. Is it the beginning of the end?

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

  • Finally, some tech sell-offs — and the question on everyone’s minds [0:33]
  • The “smart money” is positioning in cheaper asset classes, not what’s hot [5:30]
  • And the economy keeps getting better [7:55]
  • Two fundamental things when it comes to income plans [10:26]
  • Why your portfolio should be based on your goals and a diversified strategy [16:27]
  • The random facts of finance that may shock you [18:03]

The tech bubble could be popping, or is it just a correction?

As we began to see sell-offs of tech stocks this past week, everyone began asking the question: "Is this it? Is the tech bubble about to burst?" We tend to think it’s the beginning of the end because stocks that go up when the sales of the company haven’t gone up are risky at best. The growth we’ve seen in these stocks is superficial, driven by speculation, not sound investment strategy. It’s only a matter of time before it’s over — and it looks like it could very well be over.

Economists are batting 1000 — and all wrong

We’ve all got that friend or relative who continually sees the glass half empty. There are lots of reasons some people see the world through a negative lens, but one thing Bob has always said is that many people think they sound smarter when they talk negatively or critically about things. Economists these days seem to be in that boat. All they can say about the economy is skeptical, but the reality is that we’re much better off than anyone predicted and it just keeps getting better.

In every dark cloud, there are silver linings and in the current situation, you can take advantage of what’s happening in the economy to profit from it. But you have to take your eyes off the glitzy, fancy-looking things out there and instead, look at the common sense things that are happening and invest in them. In this conversation, we chat about some of those and give tangible examples of how the smart money is going in this direction. 

Your income plan needs to have clearly defined income streams

Do you even know the different types of income that fuel your lifestyle? There are likely more types of income than you think. First, and the one most of us think of, is wages or earned income. But there is also Social Security and pensions, rental income, annuities, and interest and dividends earned on stock holdings. You want to build your retirement portfolio for income because income is what will matter most to you during retirement.

But as you do so, do it in a diversified manner. You don’t want to overweight any one investment. That can bring on sudden losses that are devastating. What you need to keep in mind is that even when the market is down, interest and dividends don’t really change that much. That means interest and dividends can easily be the biggest part of your return, long term. The secret to investing is that if you own investments that pay income, and if you don’t spend that income, it gets reinvested to buy more shares for your portfolio. That is sustainable, dependable, repeatable income — and it’s smart. Listen to hear more about how you can make it happen.

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Mind-Numbing Tech Numbers And Why The Stock Market Is Always A Winner, Ep #4

Thursday Sep 10, 2020

Thursday Sep 10, 2020

We are beginning to sound like a broken record — you remember what a record is, don’t you? Again, we’re discussing the incredible sustained growth of tech stocks in the U.S. even though many of them, like Peloton and Tesla are not posting ANY profits. What’s going to happen with this tech bubble bursts? Are you putting yourself at risk?

And why are some people so afraid of the stock market? It’s one of the only investment vehicles that on average, always goes up. That may sound like an exaggeration but it’s not. Listen to this episode to find out why we can say that, what it means for smart investors, and how you can make sure that your investment strategy is proactive rather than reactive.

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

  • The mind-numbing tech stats (worth more than all of Europe) [0:38]
  • Doing the simple math on the top five tech companies - does it make sense? [5:47]
  • It’s a huge opportunity cost by NOT investing your money [10:20]
  • We always think the country we are from is the best for investing [19:01]
  • New York City has a 20% unemployment rate. Wow! [19:35]
  • When insiders are buying, you don’t want to be on the outside, looking in [22:55]

Who will be left holding the bag when the soaring tech stocks take a dump?

As one example of the insanity happening with tech stocks right now, Tesla stock continues to go up — and what does Tesla do? They issue more stock. That only benefits Tesla, not retail investors who keep buying up their stock. There are lessons to be learned here friends, and some of it comes from looking at history. Back in 2007 the European stock market was worth four times the U.S. Tech sector. Today it’s just the opposite. So, why not buy European stocks now while U.S.tech is so high as an investment in the future? 

The point is this: the tech stock bubble will not continue forever. Smart investors like Warren Buffett and Tim Cook (Apple’s CEO) know this. Warren is buying in Japan right now, as well as energy, and Bank of America Financial (all of which is being poo-pooed on the financial channels right now). Tim Cook just sold $130M worth stock in his own company, Apple (a tech company, by the way). What does that tell you? Would you sell your company’s stock if you were convinced the company would go up 1000-fold in the next few weeks? Diversification is a good play right now, to prepare for what’s coming.

Markets are like a pendulum, swinging between fear and greed

The reason people feel like the stock market is risky is that they’ve listened to too many horror stories about someone who lost their shirt in the market. But most people who tell that tale are guilty of buying a few favorites without keeping a balanced portfolio. Yes, tech is doing extremely well right now, and nobody can tell you the day and time the current tech bubble is going to burst. So should you ride it out, hoping for the best? Hope is not a good investment strategy. You need to be proactive rather than reactive when it comes to investing. Diversifying your money makes sense and it’s the strategy that’s hiding in plain sight during this tech insanity.

People will always do what’s in their best interest - until they become afraid

Because people always do what’s in their best interest, many are holding cash right now, waiting out the pandemic and the upcoming election before they decide what to do with their money. But that's unwise thinking. The reality is this: holding cash is MORE risky long-term than stock market investing. Here’s why: Inflation goes up by 3% every year, so you have to grow your money to keep up with what it costs you just to live. With the average Money Market account yielding 1%, you can see what’s happening if cash is your current strategy. 

If you understand how the stock market works and keep a balanced portfolio, all you can do is win. The market may adjust from time to time, and when it does people become afraid, but your shares don’t disappear when the market goes down. You still own them. So should the market drop, and you keep your cash IN the market until it goes back up (and it will), you will reap the reward. Just know that the fact is that stocks have gone up over your entire lifetime, even though they pull back at times, and you can be at ease. 

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