Welcome to our monthly Economic, Capital Market, and Financial Planning tip of the month. Once again a special thanks to all of  YOU … the best clients and friends as your experiences have again given us the subject matter for our Financial Planning Tip of the Month.

For those new to our writings, we touch on the most pertinent Economic and Financial “stuff” along with a video of my mug that has even more specialized details of the latest month as well as this post.

VIDEO

You Tube Direct Link   or   Vimeo Direct Link

Financial Planning Tip: Home Stretch 401k/Qualified plan Max time

With just a few more contribution periods left, now is a good time to review your 401k contributions to make sure you are contributing the maximum available for your situation.

Also, take a peek to see if your allocations are correct as well. If we have completed your withholdings and allocations, and something has changed, shoot a quick note to us, we will review again to make sure we are all on the correct path to the end of the year.

It’s all about those rates (no treble)

Less bond dealers and a blow up somewhere led to a sharp fall in rates. It will eventually come out who was forced to sell, but as a October boo goes, rates cratered lower mid month with a slight bounce back.

This appears to us more of a situation (someone was forced to sell) than fundamentals and we continue to see higher rates in the nearer future.

Quantitative Easing Ends

Several years ago, the Federal Open Market Committee then chaired by Ben Bernanke embarked on a path of asset purchases cleverly name Quantitative Easing (QE).

1. Three continuous rounds of QE (1,2,3)  were completed through monthly purchases of fixed income/bonds via the Federal Reserve
2. Longer term Interest rates were pushed down
3. Asset prices were pushed up
4. The Economy, while slowly, caught its footing

Just as they should, these asset purchases were stopped in the month of October.  Markets should begin more open price discovery (we think higher rates.)

Have a Great Fall!

John A. Kvale CFA, CFP