Category Archives: Investing/Financial Planning

Posted in Investing/Financial Planning, Retirement Planning, Social Security

Tagged Social Security, Social Security COLA, SSA

Thoughts on the Capital Markets Reactions as they Relate to Different Election Results

Posted on October 26, 2020 by John Kvale CFA, CFP | Leave a comment

If you followed our writings for any length of time at all you notice a clear absence of political discussions!

We’ve had multiple visits on market reactions and wanted to clarify here publicly, without political comments of course.

Possible Market Reactions to Differing Election Outcomes

What follows is a carefully written, candid explanation of what we think the Capital Markets may do under several scenarios.

Insert your own probabilities of outcomes so that you may have an expectation of how Markets MAY react.

In order of our estimates of most disruptive to least disruptive:

Hanging Chads – No one is elected and a lengthy battle ensues – In our minds, most Market disruptive – Participants dislike uncertainty

Clean Sweep Either Direction – This may surprise you, but participants generally favor a partial party political holding

Partial Party Holding = Inferred from the points above – Partial party holding in either direction is likely least market disruptive

There you have it, maybe some surprises …. but our thoughts on possible market reactions … no guarantees of course, but in fielding a few questions, we thought others may like to hear as well!

Have a Great “Elections Market Movement” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in Investing/Financial Planning, Market Comments

Tagged Election, Markets Reactions to Election, Us Election

Year End Tax Planning Thoughts – Realized Asset Tax Gains, If you’re on the Edge You Might Want to Take Them Now

Posted on October 21, 2020 by John Kvale CFA, CFP | Leave a comment

With a couple of weeks of the final quarter under our belt we thought it a good time to talk about year end tax planning.

Once again much of this has come as a result of questions from you guys in the field, so thank you very much for the idea!

If you’re on the edge of taking gains on assets, strongly consider taking some this year!

Given the current level of tax rates, no matter what the political outcomes it’s likely we are at a lowest tax rate for sometime to come.

The much-needed stimulus and in our opinion perfectly OK to use, will eventually need to be chipped away at in some form or fashion,

It is very likely that we may all see higher taxes in the not too distant future both from a Federal Income Tax Level and an Asset Capital Gains level as well.

If you’re planning on selling a business, stock, asset or anything that may realize any taxable event certainly consider doing it sooner as in possibly this year, rather than later.

We are by no means making a tax statement forecast but simply looking at the odds and attempting to give ourselves the best possible longer term outcome. Please don’t recklessly go realize gains and certainly check with your Tax professional before making moves!

Have a Great “Realized Tax Gains” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

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Posted in Investing/Financial Planning, Tax Related

Tagged Asset Taxable Gains, Capital Gains, Federal Tax Rates, tax planning

Traveling Update, Are We Traveling Yet? TSA Throughput Update and General Thoughts on Travels from the Field

Posted on October 19, 2020 by John Kvale CFA, CFP | Leave a comment

Just after The United States started limiting travel we Luckily stumbled across TSA throughput which measures air travelers going through TSA checkpoints.

Here is a link to our prior four articles … and with an intent of updating for our collective review every 30 to 60 days we accidentally let this one go 78 days.

First the 2020 numbers noting the dramatic drop-off and then the continued increase. It appears that we are somewhat leveling off and it will be very interesting to see what this looks like as we head into the fall and winter season. On the one hand every day gets us closer to a cure and on the other hand the cold and flu season may cause some to limit their travel.

Here is a more telling chart which shows the difference from last year and this year, while we’re far from back to the norm we are continuing to gain strength and once again it will be interesting to see how long it takes us to get back to the 2019 numbers.

In talking to friends, colleagues, and clients, the general business traveler seems to be ready to travel approximately spring of next year, and many have traveled this year, for the record but with a few exceptions, all felt safe and had good experiences, especially on flights with no center seat seating.

Have a Great “TSA Updated” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in Investing/Financial Planning, Market Comments

Tagged TSA, TSA Throughput, TSA Update

Finally Taxes are Done … Rob Kaplan Federal Reserve Chair Town Hall Personal Embarrassment …

Posted on October 16, 2020 by John Kvale CFA, CFP | Leave a comment

Whew…. that was easy…. NOT!

Finally we can say goodbye to 2019 taxes … Wednesday Marked the due day for personal Federal Income Tas Extensions.

Luckily (where work and opportunity cross – neat saying heard recently) in the fall of 2019 we went through EVERY taxable portfolio and confirmed tax basis – both reported and unreported to the IRS…. never knowing what this year would bring. This exercise effectively minimized tax documents to one report per account.

Glad we are done!

A Nerd Incident with Robert Kaplan and the Dallas Federal Reserve

On Wednesday of this week, yours truly attended a Virtual Town Hall chaired by Robert Kaplan (pretty big Fan, here is a link to nine articles we have written for those interested).

In true nerd multitasking form, the Zoom meeting started, on the Cell, why not listen while jogging? Cell inserted into runners band on arm and away we go!

Expect comments on the talk, it was very good and interesting…..

Post jog, cell back off runners arm band and onto the couch as the live question and answer session had commenced.

Then this:

“Next Question is from John! “
Quick glance to the cell and an Unmute flashing button was covering my entire screen! Yikes

“John you must Unmute your device“
Twice from the moderator then twice from Robert Kaplan

With no question, the Unmute button was not going to be touched! Finally after what was likely 5 seconds, but felt like 5 awkward minutes, the moderator and Kaplan moved on!

Whew, embarrassing moment averted… or was it!

A question or two later and then this:

“Ok, that was our last question, let’s go back to John and see if we can get his question answered!“
Oh No!!!!

This time the Zoom video was shut off before the Unmute logo hit the phone screen….

Can’t make this up!

Hope you enjoyed a nerds chance encounter with Robert Kaplan and maybe even got a chuckle.

Enjoy your Friday, and your weekend …. going to be chilly for the first time in our neck of the woods…. talk next week!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in Clients/Clients Only, Economy, FOMC, Investing/Financial Planning, John Kvale, Market Comments, Personal

Tagged Dallas Federal Reserve, FOMC, Personal Taxes, Robert Kaplan

Q 3 2020 Cover Letter

Posted on October 12, 2020 by John Kvale CFA, CFP | Leave a comment

As a kid, a frequent saying of my parents were,

“Son even too much of a GOOD thing is still too much!”

While it may sound like we were talking out of the exact opposite side of our mouth, investors looking through the valley to the other side which we had argued for the last two quarters seem to be having too much of a good thing

As discussed in great in our Newsletter for the first time in almost five decades of professional investing, two quarters ago we had to argue positively when everyone was extremely negative and dark clouds appeared to be in the sky, forming our thoughts of looking through the self-imposed valley to the other side where brighter skies may lie.

Fast forward to the present, fear by many has been replaced with greed and a short-term memory of the perils once worried about. As mentioned once again in our quarterly Newsletter there are similarities to 1999- due to heightened valuations and slight reckless behavior. While prices likely overshot to the downside earlier on in this year it is likely they have overshot to the upside now.

Where do we go from here?

We are not saying things must fall dramatically or an imminent decline is coming, only the opportunity short to mid time frame returns are diminished due to the higher valuations.

Inflation expectations, as measured by the Consumer Price Index (CPI) or the Dallas Federal Reserve’s own adjusted inflation measure, the Trimmed Mean Inflation measure are worthy of our attention as very few expect any inflation at this time. An increase in either of these measures would be more startling to the Federal Reserve (FOMC) and Capital Market Investors and would certainly present a headwind.

Lastly, as we head into historically the best quarter of the year (led by historically the roughest month), we would argue this is not a normal year and our guards should be up, with slightly thicker investors skin as we head into the end of this year.

Stay safe be well will talk to you at the end of the year!

Sincerely,

John A. Kvale CFA, CFP

Enclosure (2020 Report)

Posted in Clients/Clients Only, Investing/Financial Planning, John Kvale, Performance Report Cover Letter, Personal

Merger Approved, Expecting Minimal Changes… Multiple Conventions …. Friday

Posted on October 9, 2020 by John Kvale CFA, CFP | Leave a comment

This Tuesday, October 6, 2020 the TDAmeritrade/Schwab merger was approved by the regulators …. it’s a big merger, hence the time for final approval…

As they say, now the real work begins… we expect mostly transparency and behind the scene actions for the next 12-18 months…

Coincidentally and with good timing, the big annual convention is all on line and later this month…. any interesting findings will certainly be shared…

Speaking of convention, ANOTHER convention (NAPFA), we have never attended, has gone virtual … at the end of the month has garnered our attendance as well…

Ahhhh… but today is a Friday, heading into an early October weekend…. nice and cool here, with an injured tennis player, home for a few….

Enjoy and talk to you next week !

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in General Financial Planning, In The News, Investing/Financial Planning, John Kvale, Personal

Tagged Napfa, Schwab, TDAmeritrade

Interesting Interest Rates Chart a Historical View and a Super Short Term View with Noted Movement

Posted on October 7, 2020 by John Kvale CFA, CFP | Leave a comment

We spotted this neat chart last week from our friends once again at Visual Capitalist … here

Worth noting … we were close to these levels in 1945 as can be seen on the chart…

While the above is a more descriptive 200 year chart, we just could not help ourselves in showing a much shorter but encouraging one month chart of the same ten year treasury noted above …. again, VERY short time frame, but we like the upward movement….

We crow a lot about interest rates, but they really are VERY important…

Have a Great “Interest Rate Movement” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in Debt - Debt Management, General Financial Planning, Interest Rates, Investing/Financial Planning, Market Comments

Tagged 10 Year Treasury, Interest Rates, Visual Capitalist

Q 4 2020 Newsletter Video Audio Podcast Review of Year Events, Cause and Effects By John Kvale

Posted on October 5, 2020 by John Kvale CFA, CFP | Leave a comment

Click here for a direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page

Unlike the last two Newsletters which had very little economic and market related comments, this one is all about where we have been, what has occurred and where we may be going!
J.K. Financial q 4 2020 newsletter

Let’s get going!

Thanks in advance!

Q 4 2020 Newsletter

(YouTube)

As the spread of the Covid Virus occurred, Capital Market Participants in true anticipation form, voted with their feet and sold assets across the board well ahead of the eventual lock downs.

The largely followed S&P 500 (Larger US Companies) fell over 33% along with major international markets such as the German Dax falling over 35% and US Small companies represented by the Russell 2000, falling over 40%.

The most startling item of the drop was the speed at which this drop occurred, 27 days!

Ignoring the speed of these most recent declines is a bad idea as we need only look earlier in 2018 to see ANOTHER very fast drop.

The FOMC Steps In – Lowers Rates

By Mid-March as Capital Markets continued their descent, the FOMC (Federal Open Market Committee) led by Jerome Powell, dropped the hammer on interest rates by a full 1% to zero. During normal times, .25% is the usual adjustment as can be seen by the late 2019 and early 2020, non-crisis adjustments.

FOMC Adds More Fuel

Correctly using the financial crisis of 07-09 as the play book, the FOMC took the bazooka out, and starting buying assets to flood the markets with liquidity. The current bazooka is much bigger (about 3 X) this time as can be seen by the difference in balance sheet increase of $1 Trillion in 07-09 versus the $ 3 Trillion and counting increase currently.

It Worked (Maybe Too Well), Capital Markets Took Notice

You know us to be very positive – all through the many negatives that have occurred !

You also know we will call it like we see it!

Markets have officially gone too far and are ahead of themselves, expect bumps and no extra risk taking is warranted at this time – CAREFUL!

We hope you enjoy … talk to you Next Year – 2021 !!!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

www.jkfinancialinc.com

www.street-cents.com

Posted in Audio, Economy, FOMC, General Financial Planning, Interest Rates, Investing/Financial Planning, Market Comments, Newsletters, Podcast, Video

Tagged FOMC, Forward PE, Inflation, Interest Rates, JPMorgan, QE, Trimmed Mean, Valuation

Newsletter is In the Mail … Full Review Coming Next Week – Hopefully – Out of Town Tennis – Friday

Posted on October 2, 2020 by John Kvale CFA, CFP | Leave a comment

By the way, if you know someone that may find our newsletter interesting and useful, send us their address, we will add them to our mailing list — yaya, the novelty of a paper Newsletter, call us old fashion, but we are so old fashion we are new– at least we think so – haha – ok digressing again!

Those that received the September review mid week may have noticed the video was not embedded in the email for some reason … inquiry minds want to know and are trying to figure it out… hence the delayed Newsletter review…

Tennis Weekend

Good news … the tournaments are starting up in full force and with a little luck, social distancing and strict following of the rules maybe we can continue – 15 year old is getting closer to 16 and closer to graduation – sophomore…. time goes fast…

Ahhhh, but today is a Friday heading into a wonderful temperature weekend in our neck of the woods….

Enjoy, be safe and we will get that Newsletter Podcast video Review out to you next week, one way or another !

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.