This 5th Week of September 2022 Thoughts
Fed Fund Watch: 10-Year Yield: the 10-Year Note was r.54% last week and is 3.70% this week. Do NOT spend one minute angsting about your bonds being down in value.They are the first place we will be buying.
Do you use Moneylink to move $$ to your bank? Be sure to allow for 4 business days for the funds to clear your bank.
Fed rate increases take 9-12 months to show up in the economy: this can’t be
fixed in 1 or 2 quarters.
Recession watch: Summer 2023 or has it already started?
The stomach is a more important organ when it comes to investing than the brain is. It doesn’t take brains to see that the greatest wealth in history has been created by investing in good companies at good prices but it does take a strong stomach to stay focused on what is important and to not let the “noise” ruin your financial plan or your day.
The world is not going to stop turning because the market is down and we can not lose sight of what is ultimately important: a strong, prosperous and resilient global economy. While there are many unknowns, the reality is that there are thousands of companies and hundreds of millions of people who go to work every day to produce the products and services we need to keep our world running. We’ve had booms and busts as long as there has been a stock market,but over the long term, good businesses become more valuable over time. Great companies don’t stop being great because their share price is down and interest rates change: recessions come and go…as this 20 year chart shows.
The gray sections are the years we’ve been in a recession and I’d say it looks like we are about ready to have another one. What is important to you, though,is knowing when it is smart to invest in the great companies that will help you fund your lifestyle. In the sidebar to the left are the first of my portfolios we’ll be buying: my Skye Rising Rates Capsule Portfolio and my Skye Capsule Stock Portfolio. We need to focus on what we can control: over the next 6 months (give or take a month) I plan for your portfolio to be pretty fully invested in the headlines that matter:
· Geopolitical Global Dynamics: The conflict in Ukraine should boost EU renewable energy development and the pace of project permitting in coming years. · Water issues across the US: droughts in the West and cities that have contaminated water and failed water and sewer lines bring investing opportunities. · Landmark U.S. Climate Legislation: The Inflation Reduction Act provides a boost to the energy transition in the United States—the second largest market for renewable energy in the world, after China.
Are we headed for a recession? Dr.Copper, the metal with a PhD in Economics, says yes!
Why does this matter to you? Think I am joking? Check out where Dr. Copper got his degree: Dr. Copper
Fake cryptocurrency giveaway sites have tripled this year and the number of websites promoting cryptocurrency giveaway scams to lure gullible victims has increased by 300%. Cybersecurity company Group-IB has identified more than 2,000 domains registered in 2022 specifically for this purpose. When I opened my office at 36N “Crypto”was all the buzz because so many tech-heads gathered there. I attended workshops to understand just what the heck bitcoin and crypto was but no asset class has ever been more inscrutable…or actually, unbelievable. Still today,rightfully so, the average person just sees it as a Ponzi Scheme. Take this example: a 5-year chart
Why does it matter for you? This my friends, is what we in the investment biz call a “round trip:” up and right back down again. The week I launched Skye Advisors, Grayscale Bitcoin Trust was at $20: it hit $58 last fall and today it is $11.39. You think the stock & bond market has had a rough year: how do you think bitcoin investors feel? The reason this should matter to you and me is that Schwab has just launched its first crypto-related ETF: Schwab Crypto Thematic Index. Ticker STCE, it offers investors global exposure to companies expected to benefit from development of cryptocurrencies and other digital assets…totally different from a bitcoin-based fund. This speaks volumes: Schwab would not be doing this if they did not think this sector would get sorted out and become a real deal. This fall I am going to be taking an in-depth course on digital currencies so I can help you sort through if, and when, it might make sense for you to invest in this sector. As the Chief Compliance Officer at SAA…I’ll be drafting a policy of who, what, where,when, and why Bitcoin is suitable for clients. We simply can not avoid what may be the asset class of the new economy...and the century.
Required Disclosures: Always read the fine print! This content reflects the opinions of Julie Skye and is subject to change without notice. This content is for informational and entertainment purposes, and it is not a recommendation regarding the purchase or sale of any security. There is no guarantee that any statements, opinions, or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Securities investing involves risk, including the potential for loss of principal. There is no assurance any investment plan or strategy will be successful.
Julie is an Investment Advisor Representative of Sustainable Advisors Alliance, LLC (SAA, LLC): Advisory services are provided by SAA, LLC.
Registration with the SEC does not imply a certain level of skill or training.