Let's Talk Money

I know I have some amazing colleagues that do the show alongside me, and today you are stuck with me. And if you have any questions pertaining to your financial future, I would love to speak with you. Any questions whatsoever, give me a holler. The phone lines are open. The numbers are the same as they've been for almost thirty years that I've been giving them out. One eight hundred talk WGY one eight hundred eight two five five nine four nine. That's one eight hundred eight two five fifty

nine forty nine. Any questions whatsoever, folks, give me a call. I'm here and I would love to get your pointed in the right direction. Give you my opinion Anyway, the question came up last week. Different folks give different you know, answers to different questions. I guess different folks different strokes. Right, So we're you know, I'm a professional. I'm a fiduciary. I have no conflicts of interest. We don't sell investments.

So all the advice that we give our clients and all the you know, the sound comments that I make on radio are what I feel professionally is is prudent and it's good. Just a good way to go. That's all we care about in our firm. And I have twenty colleagues. We all believe in it. Our clients come first and foremost. Nothing else matters, nothing other than our clients.

Eight eighty two five five nine four nine. So last week I was with you, and I thought, you know that Thursday and Friday entering the weekend was crazy, couple down days week, jobs report, the economy slowing, the FED just a few days before that coming out saying we will probably have a quarter point interest rate cut at our next meeting. We will not be looking or entertained aero point five zero half a percent cut. We don't feel it's in the cards. And as they said, last week,

just two days later. I'm sure if they could go back, if they had that report in front of them before their meeting on Tuesday and Wednesday that week, I'm pretty sure they would have said, you know what, maybe today is the day we should be cutting rates because what they don't want to do is be late to this party again. And I say that because they've been late to the party before. Not to beat up on them, but let's beat up on them. They've been wrong. I'm

not so sure. They use a whole lot of common sense a lot of times. They're smart people. They had their nose stuck in the textbook. I keep saying. They have a great job. They never really left college. They just kept studying and they look at all the data. But they're really not in touch with reality. And I said that a few years ago when they said inflation was transitory, temporary, inflation wasn't really going to stick, I said, what are you crazy? When was the last time you

filled up your car at the gas station. When was the last time you went and bought milk or bread, paid your utility bill. Inflation was as real as real can be, and it shot through the roof nine point one percent it was. That's a real number, and they just felt that it was transitory. So they really missed that boat completely. Now, they did a good job. I'll give them credit for it. They had eleven interest rate hikes.

They were pretty aggressive, they talked like a good bully in a school yard, and they brought inflation down to about the three percent neighborhood cores in the two percent neighborhood and they did what they were supposed to do, but we suffered, We suffered terribly because of it. Well, now now all eyes are on the Fed because now

we're wondering should the Fed have started cutting before this? Now, the other side of the argument is, I'm sure if you want to talk politics, and I do not want to talk politics, there's a lot of people that feel the Fed shouldn't make any cuts until after the presidential election in November, because that will if they start cutting interest rates, that will help the economy and that may may make the current administration look better than maybe they truly are. But as I said, I don't want to

talk politics. That's just another argument of why the Fed shouldn't cut rates. But I don't know, I don't know how they cannot cut interest rates at their next meeting September seventeenth and eighteenth. There's just no way. And some people feel they really should speed it up and cut interest rates sooner than that. They really should cut interest

rates like now, and maybe they should. I know that jobs report showed the you know, softening of the labor market, not as many people were getting jobs, and that's a big number. That's a big piece of the data that they look at. We had the CPI report coming out this coming week. That's another big report showing, you know, just where consumer price index is. There's a lot of data that the Fed looks at. Let's hope, Let's hope they they really are ahead of the curve, even if

they're just a little bit late to the party. Let's hope they get to the party soon and do the job that we really hope they do. They're supposed to be an independent, autonomous, you know part of the workings. You know, the Federal Reserve really doesn't answer to anybody. They're not supposed to answer to anybody. Agree with that, but we also we need them to have a touch of reality, get out there with the ordinary folk and

talk about what's going on. There's a lot of people that aren't feeling too good about their financial future, and that's something Remember, the consumer makes up two thirds of the economy two thirds. The consumer is an important part of what goes on in this country, and the FED really needs to get out there and be in touch with the consumer and see what the consumer is experiencing. So we don't want the economy to slip into a recession.

We're still praying that there's a good chance that will continue to have a soft landing where we don't go into a recession and things turn around. But right now a lot of people are worried about the economy being you knowsicly losing a lot of its steam. So today we're going to talk about this wild, crazy week in the stock market, and as I said, call me with

any questions you have with regards to your portfolio. If you're thinking about selling these you don't like the headlines, I will do my best to talk you out of that, because what you don't want to do is sell. You don't want to have any knee jerk reactions. You don't want to panic just because of the headlines, just because we have some volatility in the market that's part of being an investor, and that will come with time, and I guarantee you it's not going away. We'll always have volatility.

We'll always have corrections and bear markets and recessions. There's no getting around that. It's part of It's just life. So you can't you can't panic when all of a sudden you're listening to a financial show or you're you know, coworkers, you know, standing around the coffee machine and you know, talking doom and gloom. You just can't panic. It's the worst thing that a good investor can do. And this

was This was a crazy week. So if you want to talk about your feelings, your portfolio, maybe what your advisor is advising you or selling you and you're just not sure if it's right for you, give me a call one eight hundred eighty two five five nine four nine one eight hundred eighty two, five fifty nine forty nine, any questions whatsoever. So it was, as I said, a crazy week, just a crazy week. Monday and listen, I was on the show last weekend, and I told you

we had Thursday and Friday were pretty bad. Wednesday, the Fed Reserve chair finished up at two day meeting left interest rates alone. Gave us a little hope that there will be cuts coming down pike. But then all of a sudden, you know, between the tech earnings and the week jobs report and consumer sentiment, you know, Thursday and Friday were just a Debbie downer. We found out Saturday, I broke the news to you that Warren Buffett sold

half of his Apple steak. That was a huge, huge sell, especially for us because Apples really it's our number one holding. So you know, between the earnings that came out with Apple and Amazon and other technology companies that week. I was on the show last week and I thought last week was a crazy week, but this past week, this past week was really a wild week. So we had Thursday and Friday, we're down weeks. The Nasdaq officially went into a correction territory, which means it lost ten percent

from its market high. So Nasdaq last weekend when I was with you, ten percent correction. Officially, a correction. A correction is when the stock market or any market, bond market, whatever market you're you're looking at, but we're talking the stock market, when you go from a high point and you lose ten percent, that's a correction. When you lose twenty percent, that's a bear market. So NASDAK went into correction,

down ten percent. Now the SMP was down just less than six percent from it's high, so it hung in there. And I've been saying this for years on the show because we own as much Nasdaq as we do the SMP Broad Stock Market Index, we own equally as much. It's our core position. I like Nasdaq. NASDAK is our growth part of the portfolio. Great companies in there, and you buy it with the simple QQQ better known as

Nasdaq Composite one hundred. It's the hundred largest companies in NASA stack, So you're not buying all three thousand plus companies. You're buying just the top one hundred companies. And these companies are good companies. And the top ten make up fifty percent of Nasdaq. So you have companies you know, all of the Magnificent Seven are in the top ten. Then you have a couple other bell Weather companies. So when you buy QQQ, the top ten holdings are making

up fifty percent of all of Nasdaq. So Nasdaq went into ten percent correction as they did the show last week. The S and P was down five point seven percent, and then on Monday, Monday, holy moly, you know, the floodgates open just like yesterday with Debbie coming through the area. It's I mean, when I tell you it was a crazy day, it was a crazy day on Monday, basically over fears of recession, the unwinding, and the so called

en carry trade. That's basically when traders borrow cheap yen, use it to invest in other assets like US stocks, then sell in the currency rallies. And when Japan raised the rates, that kind of put a scare in the in the in the en carry trade market, we had. God, the politics has been crazy. We have Vice President Harris kind of bringing on board her new VP. They had Donald Trump, the former president, and I mean they were

going at it like a good boxing match. Politics is I don't know about you, but I am sick of politics. I just I can't. I can't stand to even listen to it anymore. I almost wish November six would come and whoever our president is will be our president, hopefully, hopefully it'll be a good choice. In hindsight, everything is is is really crystal clear. So you know, for the week, the Dow was down point six percent, SMP down point

zero four percent, So it's like kissing your grandmother. Just kind of a whole hum week for the SMP, even with it being down over three percent on Monday alone. NASDAK was down over three percent as well, so Nansdak was down thirteen percent from it's high on Monday. For the week, Nansdak was off point one eight percent. The good news is, and it's good news because when when you buy NANSDAC, that Nasdaq composite isn't what you're buying.

You're buying QQQ, which is the NANSDAK one hundred that was actually up point four percent one eight hundred eight two five five nine four nine one eight hundred eighty two five fifty nine forty nine. Or the phone line or the phone numbers, give us a call, any questions whatsoever. I'm going to go to the phone and we're going to pick up Mike in Delmart.

look at the S and P, same thing. You know, the S and P your top holdings. Apple makes up seven percent, Microsoft almost seven percent in the video, almost six percent, Amazon three point four, Meta, which is Facebook two point five you have Google. Between both share classes, you're looking at about four percent Berkshire Hathaway, which is a great holding, almost two percent, Eli Lilly one point four, Broadcom one point four JP, Morgan Chase one point three two.

The top ten make up thirty three percent, so it's not as much as the SMP. When you look at the equal weight, they're all equal weighted, which means that instead of having Apple make up you know, seven percent, Apple makes up as much as the lowest cap company in there, and it's like zero point six percent. So when you buy that equal weight, you're what you're doing is you're broadening out your portfolio. And I'm very very in support of having the equal weight and the portfolios.

I've been saying the stock market really for the stock market to really do well, you need the rest of the market, those other four hundred and ninety three companies outside of the magnificent seven. You need to have the rest of the market take part in the rally. So when you buy the equal weight, what you're doing is you're counter balancing that S and P five hundred and as they said, I want to be too concerned about the top ten holdings making up thirty three percent of

the SMP. I'm actually comfortable with that. You know, we actually use the broad stock market, which is very similar, highly correlated. The differences the broad stock market takes into consideration, for instance, the SMP mid cap four hundred and also the SMP small cap six hundred. But you know that equal weight you got point two six percent of every company, all five hundred companies, and the top ten account for two and a half percent instead of thirty three percent.

So I think it's a good, good counterbalance to the SMP. I think if you put that in your portfolio, you won't be disappointed. As I said, when they start cutting interest rates, and I can almost assure you I can't make guarantees, but i'd bet I'd bet everything in my pocket that they will cut rates on September eighteenth, when they come out of their two day meeting. If they don't cut rates, I think the FED is really missing

missing an opportunity. I think it's time for them to just fess up and say, hey, listen, we need to cut rates. We need to get this economy going again. So I'm hopeful that they'll cut rates at least by then, if not before, And when that happens, you're going to see the economy get better. And when the economy gets better, you're going to going to see mid cap and small

cap companies do well. That's what we call it broadening out the stock market rally and having these other companies take part, so that equal weight allows you to own all those other companies. And if you were to have, you know, if you take your core position and split it between the SMP and the equal weight, I don't

think that's a bad thing. We don't have that much equal weight in our portfolio because you know, I always say we're more of a growth manager, and our portfolios have done extremely well because of our belief in growth. And that's one reason why we have NANSDAK. So we have as much NASDAC in our portfolio as we do the Broad Stock Market Index. But I like the equal weight it gives you. It just gives you exposure to companies that you're not getting as much exposure in the SMP.

and hopefully I'm not going to be mentally incompetent. But I say in my office quite often, until one of those three things happen, we will never take NASDAC out of the portfolios. I love NANSDAC that much. NASDAC today is different than the NASDAC or the turn of the century. A lot of those companies disappeared forever. When you look at Nansdak and the holdings of Nansdac, I mean Nansdak is just I think a good growth index full of technology.

Sixty five percent of Nansdak is technology, So it's really we have a slant towards technology. And that's my other saying in the office, technology is such a part of our life. It's not going anywhere. And anybody who thinks technology is going away, it's not. Just look at everything that you do in your in your day to day you know, activities, you're you're using a lot of technology somehow, some way, and you're using more and more of it. So Nasdak not only is our growth holding, it's really

our technology holding as well. And there's just a lot of good companies in Nasdak. So no, I'm not souring on Nasdak. You know, year to date, Nansdak is up about eleven percent. The broad stock market in decks is up twelve percent. But when you you know, look at at Nasdak over time, give this, I give this statistic, got and over the last fifteen years, your average return in the S and P year in year out is about thirteen percent, and it's nineteen percent for Nasdak. I

love Nansdak. Hey, Mike, we're going to take a quick break for the news, so I'm gonna let you go. Folks, you're listening to Let's Talk Money, brought to you by Bouchet Fin Answer Group, where we help our clients prioritize their health while we manage their wealth for life. I truly appreciate you tuning in today. I hope that you hang in through the news. On the other side of the news break, I would love to talk to you.

The phone lines are open one eight hundred talk WGY one eight hundred eight two five five nine four nine one eight hundred eighty two five fifty nine forty nine. If you have any questions whatsoever, give me a call and I'll see you on the other side of the news break when I wake up in the morning low and the sunlight hurts my Hello, folks, thank you for hanging it through the news, and thank you for tuning in today, and Zach, thank you for that nice soft

music leading into the show. I can't thank you enough, folks, really can't thank you enough. And if you have any questions, give me a call one eight hundred eight two five five nine four nine. So you know I've been You know, I've hit a long few months, and I believe me, pray every day. And I saw this quote that from Pearl Bailey. People see God every day, they just don't recognize him. I thought that was a pretty good quote when you really give it some thought. People see God

every day, they just don't recognize him. Really, really, you know, caught my attention. If you have any questions, any questions whatsoever. One eight hundred eight two five five nine four nine, I'd love to talk to you, get your pointed in the right direction, give you my honest opinion. You may or may not like it, but I promise it'll come from my heart and it'll be as professional as listen. I've been helping clients for thirty seven years. In business,

thirty four years. I've been a fiduciary, which means we have no conflict of interests. We don't sell mutual funds or annuities or insurances, we don't make high end commissions. All we care about is what's right for our clients, and our advice is really rock solid. One five ft nine. Let's go back to the phone lines. We have Ron on hold. Hello, Ron, mister.

wanted to protect it. But I'm wondering whether or at seventy four, with the pension and Social security, which is enough to cover living expenses and stuff, and we have no deaths outstanding, is it crazy to take some of the G fund money and move it into like the the S fund or is it is it like too late?

they all own stock. But we take time to educate our clients and really teach them the reasons why they should have stock in the portfolio. And you know, there's there's a lot of good reasons why people should have stock in the portfolio. I give this statistic out often. Over the last fifteen years, your average return and the S and P five hundred is about thirteen percent your average return in QQQ, which is our you know, I only bring it up because it's our you know, we

own as much as that as we do. The S and P is like nineteen percent. And when you look at bonds, if you look at the ICE Share Core US Aggregate Bond Index, so your g fund will be comparable to this, it's like two and a half percent year in year out over the last fifteen years. So to answer your question, is it too late? You know, I don't think you should be swinging for the fences.

You don't need to. You just said that you're you're in a comfortable position with your with your social security pension, and you're not really you're you're debt free and you're not really using this money. But you know, having a well diversified portfolio with some exposure to equity, there's there's absolutely nothing wrong with it. You know, year to date, you know the the growth and income which is like a sixty forty mix. You know you're going to be

up about seven percent in a portfolio like that. And I look at you know Ed Wilhelm, He's one of my traders, and he's amazing with stats and he gives me I'm looking at it right now, year to date, one year, three year, five year, ten year, fifteen year, and whether it's our all equity portfolio or our conservative portfolio, we outperform. And I compare it to Schwab, Vanguarden Fidelity because they all have the same model portfolios. So I always want to know how we're doing because a client.

I never want a client to say, well, I can go to Vanguard and do better than I can with you. They can't our models. Our perform Schwab, Vanguarden Fidelity hands down, and I'm proud of that. We put a lot of thought into our methodology. But we every one of our clients ron has stock in their portfolio because over time, you know, even over the last ninety years, your average return in the stock market's about ten percent, small caps about twelve percent, and out of that ten percent return,

about three percent of it comes from dividends. Your average return in the bond market is about five percent. Now over the last ninety years, we had a forty year bull market in bonds from the early eighties till just a few years ago, So that ninety year bond average return is a whole lot different than the last fifteen years for sure. But the point is, no, it's never it's never too late to ease into you know, maybe have a thirty seventy or a forty sixty, just blending

some some stocks in there. That s fund, I think that mirror image is the S and P five hundred index. That's all you need. Don't put any any international holdings in your portfolio. I'm just not a believer of international holdings. Thank god, my investment committee has taken my direction on that. And if you look over the last fifteen years, so the SMP your average return is thirteen percent. Your average return for the international market is less than six percent.

And I always say, give me, give me the good old USA all day long. And our US equity sleeve is just rock solid. We continue to really perform well. And I like the US stock market. Remember, most of the megacap stocks and large cap stocks have exposure overseas through sales of their product or services and in essence, through the back door. We have international exposure, but we

don't own one international fund. We don't own one emerging market fund in our models, and I don't foresee us adding them anytime too soon, no matter how good they look. So if you do blend some stocks in your portfolio, stick to the good old USA, the US S and P five hundred index, which I think is what that S fund is.

it's not too late. Everything's in relative and I always say, in hindsight, everything is crystal clear.

rebalance the portfolio. And the only thing I don't like about the intelligent portfolios or the lifestyle portfolios, which is another good way of investing, is they just have a lot of international holdings, which I just got done saying we're not really interested in owning any international holdings. But I'm glad your daughter got into it. She will not be sorry. And if my memory is correct, her timing should have been pretty good. She should be up pretty pretty handsomely.

least ten percent away, you're not putting enough. And I always promise anybody who takes me up on that that they will not like me the first few paychecks because they're going to have less money that they can spend. But they get used to it. And when you get used to it, and all of a sudden, just like what you're saying with your daughter, your daughter's got thirty thousand dollars there. Before she'll realize it, she'll have three hundred thousand. And she's so young, she'll have three million

down the road. That's why. That's the power of saving. So I'm glad your daughter, you know, listen to you, and I'm glad you called me. And I remember that phone call when you called in, and that makes me happy. That puts a smile on my face knowing that I was able to help you and your daughter out, because I'm sure you're happy that your daughter took your advice.

taxed on it. So if she puts you know, if she makes fifty thousand dollars a year, making these numbers up, if she makes fifty thousand dollars a year and puts ten percent away five thousand dollars, she's not going to be taxed on that five thousand, and she's probably going to get a I don't know, around a two thousand dollars savings on her tax bill. So it's really she's only going to miss three thousand dollars out of her pocket,

but she's putting five thousand dollars away. That's the beauty about saving with before tax dollars and paying yourself first. There's no better way of getting ahead, Ron than paying yourself first before that money can hit her checking account. It's the first ten percent goes into her pension plan and she can't spend that. And it's a beautiful thing paying yourself first. Hey, Ron, good, good.

me get you pointed in the right direction. Let me try to you know, you know, give you my viewpoint. You know it's just my personal opinion. But believe me, I've been doing this long enough. I have a pretty good opinion on things, and in hindsight, you know, I'd like to think that I've been right more than i've been wrong. And I always say to my clients, we get paid to take the emotion out of the decision

making process. That's what we get paid the most to do, is take the emotion out of the decision making process. And when you think about that, you think of how you felt Monday when the market was down three percent. Think of how you felt a week aldgo, Thursday, Friday, when those two days the market was down and all you heard about was the economy is crashing, We're going into a recession. Those emotions make some investors do some crazy things, things that I guarantee they will regret. The

stock market, I guarantee you it will go down. I can't tell you what day, week, what month, but the stock market, it goes down fourteen percent top to bottom, low to high. The average peak to trough swing in the stock market year in, year out is fourteen percent. Comes with the territory of investing. So even last weekend when I told you NASDAK was down ten percent in correction territory. So that's part of the Actually on Monday, when I saw that cell off true story, folks, true story,

I got ed Willhelm on the phone. I you know, came into some cash recently, and I said that I want to invest all of that cash, and we hit my sandbox accounts, play accounts, because my core money, most you know, my entire pension plan has invested just like my clients' moneies is in our model. But I like to play, like everybody likes to play. So I have some accounts that I play in, and you know, one of the accounts, believe it or not, I told ED

to split it between the Magnificent Seven. That's how much I believe in the Magnificent Seven. They were all beaten up, pretty good and down in value. So so there were three accounts, I said, ED, just divide it between those seven stocks. And then the other account I have a sector allocated portfolio with different you know, sectors, mostly technology, and we invested in that. And then the third account

was sprinkling of about twenty stocks. So sandbox accounts, if I lose everything in them, I'm not going to have to worry because my core investments are rock solid in our models. But the point I'm making is, and I said to my investment committee last Monday, there's blood in the street. Guys. Take all the cash we have for

our clients and invest it. Invest it, because sometimes clients come on board, and they do what we call dollar cost averaging, and they'll say, well, I don't want to really put all that money in all at once, Let's do it over three months or four months. And they know that because we have discretion over managing their portfolios, they know that if we see a buying opportunity, we will automatically speed that up. And I instructed my investment

committee last Monday to do just that. When there's blood in the streets, those are opportunities. Volativity creates some great investment opportunities. That's how a good investor needs to think. A long term investor. You know how many people need their money over the next twelve months, and if they do, that money shouldn't be invested in the stock market. So if you're invested properly, you know that money that you're investing that's going to be in there longer than twelve

to twenty four months. It's going to be in there over the next few to several years. And when you see blood in the street like last week after Thursday, Friday, the week before and Monday, you know that was blood in the street. And my estimation, I think the market overreacted. It could have been to Warren Buffets selling fifty percent of his apple stack steaks. It could have been for a host of reasons, but there was blood in the street.

People were panicking, people were selling out, going to safe havens like treasury bonds and you know, the utilities and you know, just places that they fell. Was was was a safer place to be invested. But me, I want to go where where the action is. I want to go and have some good growth opportunities. I want to make money. That's why our returns have been pretty stellar over the years two five, five, nine, four nine. Let's go back to the phone lines. We have David in Virginia.

equal weight when you buy that S fund. So the S and P five hundred or the first five hundred companies, the remaining forty five hundred companies are mid cap small cap, so that S fund having you know, maybe you know, maybe forty percent in the C fund and twenty percent and that S fund and forty percent in the F fund the bond index might be a good mix for a good sixty forty portfolio. David, I appreciate you calling and helping me. Remember, you know, at my age, my

memory is not what it used to be. I guess David's gone. Thank you for calling David all the way from Virginia. And and you know he is not correcting me, He's helping me. One eight hundred eighty two five nine four nine.

in order. And I told them where everything will be if something happens to Dad, not that I want anything to happen to Dad, but there will be a list of where all the financial assets are, who you should call, phone numbers and so forth, and folks believe it or not, it's a good, good thing to do, good thing to do for your family, those that you leave behind, especially those that are going to be kind of helping finalize your estate, let's say, especially the executor of the estate,

having all of this laid out. And I just bring it up because you know, obviously I personally have been dealing with it and you don't realize. And I've been telling clients for thirty seven years they should do this, but you know, until you have to do it yourself, you don't realize just the how powerful it is and why they should be doing it. So, you know, I had a family meeting with my son and daughter and

went over that with them. I told them exactly, you know, where all the insurance policies are, and I told them where the deeds are to our property, and you know, told them there will be a list in there of all of Dad's financial assets right down to who to call to you know, sell the cars, you know, just just to help them along. And on a personal note, you know, I'm just bringing it up because you know,

sometimes we don't talk enough about this. I know I often talk about life insurance and how important life insurance is and if you know, especially for people with families with young children. You know, I make a blanket statement almost like I say, if you're not saving ten percent in your retirement plan, you're not saving enough. If you don't have at least one to two million dollars of life insurance, you don't have enough anyway. Just you know,

some some some food for thought. Folks. We're coming up to the end of the show. You're listening to Let's Talk Money, brought to you by Bouchhaf and Andrew, where we help our clients prioritize their health while we manage the wealth for life. I truly appreciate you tuning in. Go to our website for more information on our firm Bouchet dot com. And I meantime, enjoy the day, be well, stay healthy,