AI – Artificial Intelligence Update – Great but Not Saving the World
In this timely post (in our humble opinion – IMHO) we revisit the latest rage… AI – Artificial Intelligence – very similar to Dot.com in our opinion… So we try to clarify…
Oh… Here is a GREAT YouTube resource for explaining AI – Christopher Penn a Marketing Expert we have long followed
From the Post:
AI – Artificial Intelligence Today explained
Program assigns a number to all the words in the English Language – other languages too of course.
Cluster of huge computers located somewhere inexpensive scans everything it can get its eyes on, and tags the patterns of the numbers from the words it has scanned…
The extra speedy move of interest rates upward have put pressure on “Safe” assets, notably bonds or fixed income.
As reviewed here in great detail and with a special video on the subject, as rates rise, headwinds are created, BUT the opposite is true…. rates stabilize or even lower, big tailwinds…
Have Rates Peaked ?
Using the 10 year treasury as our marker for this review, after peaking 3.15% a few weeks ago, rates have come in and are now around 2.76% …. Progress and stability!
Here is a zoomed in chart….
Just like the change from Winter to Spring to Summer, it rarely occurs in a straight line…. remember also this longer term rate (10 years) is a measure of economic growth and will not be directly effected by the Federal Reserve overnight rate increases (thats our checking accounts)…
After almost violating our own rule, here in this updated article we reviewed the reasons not to have a claim on your insurance.
With a mini water heater retiring under its own terms but leaving a small leak and also mandating repairs… it was a great time to remind ourselves and update the article – we hope you enjoy!
Ways to Electronically Access Data
In this article we review the various ways to access our electronic information and review the major differences between our New Total Vault and just regular Account View Access.
Personal Property Tax Growth Versus Assets
With multiple comments from many directions about the rising costs of personal property we set off to do an initial analysis on just why it seems personal property taxes are digging into our pockets a bit deeper.
Our findings suggest it important to take personal property taxes into consideration, especially when dealing with our Real Estate Assets.
Capital Market Comments –
It’s all about the FOMC – Federal Open Market Committee
Last month, here in great detail the FOMC, headed by Chair Jerome Powell made statements that led market participants to expect a lowering of rates – TODAY!
If they do not lower rates later today, market participants may be disappointed…. we would not, as our beliefs are that rates cuts should be used for more pronounced economic events…. if they do lower rates, it will likely not be a continued lowering, which is a great compromise for all!
Have a Great Day – Talk to you at the end of August!
Each year the IRS publishes their top dozen tax scams, here in our post we cover all dirty dozen tax scams to be aware.
Our top three are their first three-
Phishing
Phone Scams
Identity Theft
Which are the ones we see most frequently!
For the record, we have seen way less this year than in years past!
Choose Beneficiaries Carefully Part II
Here in our Part II beneficiary post, we discuss the two most common types of designations you will likely see on Beneficiary paperwork, Per Stirpes (flows to heirs, irregardless of survivors) and ProRata (funds only to survivors) and once again as a reminder that Beneficiary language will over ride Wills and other types of Estate Planning documents – choose carefully!
Capital Market Comments –
Inverted Yield Curve
Here we spoke of the three hour inverted yield curve in a Break In abbreviated post. As an update, the yield curve has been inverted most of this week, making is a TRUE inversion.
We will have a detailed review soon, but again the importance of this event is the recession signaling prowess.
All recessions are not equal, and we highly suspect the next one will be a shallow one, but our radars are up.
Have a Great Day – Talk to you at the end of March!
In our updated post here, we discuss a few handy items to grab and remember when you retire or change jobs.
Here are the bullets-
Last Pay Check
RSU-Options
Employee Stock Purchase
Deferred Comp
Pension
Health Coverage
Long Term Health Coverage
401k
New 401k
Severance
Social Security Withholding
Institutional Trustee
This post has turned into a full article in the coming Newsletter due to the great response and continued questions and ideas that were brought up-
Possible reasons for an IRON CLAD Institutional Trustee
No other comfortable option – Many times a friend/family member is preferred
Want an iron clad back up
Calming possible family feuds
Long lasting legacy desired
Desired attention to details such as monthly distributions, bill payments etc.
Choose Beneficiaries Carefully
In this post, just earlier in the week, born from an in field experience – multiple questions in the office after – and the subject making its way into the Newsletter as well… just a great additional article to the Trust!
The most important item to remember in choosing a designated beneficiary on and account is it will over-rule your Will – choose carefully and review occasionally for safety of desired outcomes.
The Brain Shines at West Coast Event
Capital Market Comments –
Good News – Recovery without a Re-test – So far
Nothing to change from the prior month!
What a different a month makes – WOW! We literally have gone from the sky is falling to sunshine!
In our summary post in December, we mentioned that fast moving slumps, such as the one we had, frequently do not last long….
Here, earlier in the month we also mentioned that we fully expected some type of retest of those lows before we gained our footing.
We still do expect some type of re-test, but as of this date we have had the following positives that have added to the markets better mood:
Federal Reserve (FOMC) have turned very cautious about raising rates further (We are happily surprised at their yielding, and even more surprised at market participants joy)
Tariff talks are making progress – Interestingly, China has seen a slow down in their economy making for slightly more urgent talks – with a little compromise and statesmanship a resolve looks more likely – again a positive for capital markets.
Earnings are still cranking along – For the prior 4-6 quarters, earnings were red hot and hitting on all cylinders, so hot, they were not sustainable. Companies are still reporting good earnings, just not the Red Hot, overheated earnings from prior quarters – this is good news as it avails the FOMC to not have to raise rates to slow the economy –
All in all a Win- Win!
Have a Great Day – Talk to you at the end of March!
Welcome to our Video and Audio Podcast Review of our Q 4 2018 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.
Click Here for 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
BREAK IN – Save the date for the Holiday Party
November 17th – Saturday before Thanksgiving – Dallas Athletic Club from 3-5 pm
In this hugely in depth article, first we discuss the effect of earnings eventually driving capital markets, but disconnects can occur. It can even be a good thing for Capital Markets to WAY underperform earnings, as they are this year because in brings valuations back in line.
Here is the key graph
Higher Rates, a Short Term Headwind, Eventually a Tailwind
With sustained lower rates over the last decade, memories have faded on the tugging headwinds that higher rates have – IN THE SHORT TERM – on the mandatory safety asset class of bonds.
Higher rates are a great thing as Bonds/Fixed Income Assets have a place for almost all investors due to their safety and liquidity.
Once the headwinds subside our fixed income investments will have ridden the yield curve higher and begin paying more income in the form of yield – into our pockets – Finally!
Too High of Rates Can Create Trouble
Too high of rates or an overshoot CAN create trouble … or a recession…
Our friends at JPMorgan – historically show that rate is about 5% – yea FIVE percent –
We disagree and think a lower level may now be this tipping point, due to the decade low interest rate level we have just experienced-
Current at two percent, we have a long way to go before getting too antsy
Inverted Yield Curve Update
So far to good- no inversion yet!
Financial Planning
This series of articles came out of no where and in like domino fashion, once one was done the next took form and fell into place-
App of the Quarter – Hardware
Our editor took the fancy picture out due to copyright fears, but our experience with the Firestick has been exceptional – Here are the highlights of our findings
Great Savings compared to just full service in many cases
Does not take as much internet speed as we thought
Welcome to our Video and Audio Podcast Review of our Q 3 2018 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.
Click here for 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
Two and 1/2 issues in one week… No one was harmed, but it was a great reminder, they are out there!
As we mentioned in our post just prior to this one, the Grand Enchilada of Tax Forms enters the mail and electronic systems this week. These most popular forms are due by the end of January and fraudsters are taking notice.
Keep your eyes and ears out for anything suspicious!
Vault Saves Day Twice
Here in our real life experience post, we ended up needing the Vault to help save time and a HUGE hassle at a far distant Tennis Tournament. Who would have thought they would be so strict in identification at a Tennis Tournament?
Here is a neat reminder of what might do into your very own Personal Vault:
Legal Documents □ Wills □ Deeds □ Revocable & Irrevocable Trusts □Power of Attorney □ Codicils (Supplements made to a Will) □Living Wills/Health Directives □Prenuptial Agreements □ Buy/Sell Agreements □ Contracts Social Security and/or Veteran’s Administration Info Insurance Policies (Life, LTD, Disability, Medical, Car, Property) Medical Records Bank & Investment Statements □Pensions, IRAs, Annuities etc. □Investment Accounts □Stock Options/Certificates Liabilities □List of Credit Cards with contact information □ Mortgages □Loans Taxes □Tax Returns □ W-2 Forms Identification □ Birth Certificates □ Drivers Licenses □Passports Family □ Adoption Papers □ Marriage License □Pictures □ Audio Files □ Video Clips Property □Titles to Homes, Autos, Boats, etc. □ Warranties Employment Benefits
Capital Market Comments
Interest Rates
10 Year Treasury touches 2.70% – Where to next?
After floundering in the low 2% range, it appears interest rates may be on the rise. This is just in time as the FOMC (Federal Open Market Committee) are set to raise short term rates several times this year and the one thing we DO NOT WANT is an inverted yield curve (more on this another time).
We have argued higher rates are helpful as long as they move gradually.
Low rates are great. However we have argued multiple times, low rates too long can cause more damage than good.
Higher rates … increasing moderately, NOT super fast is the perfect scenario.
10 Year Rate Peek
Over the short term, the much watched 10 Year Treasury Rate looks like it is on a tear… maybe even moving too fast …
While we peek at the short term, turning points are more important over the LONG term ..
Here is a longer term chart …
The white line on this chart is what is called a trend line. Many call this stuff VooDoo … Let’s liken this to momentum in a sporting event… hard to define, but certainly existent.
Keep an eye on the far right corner of this chart … if it continues, then we may be headed for a sustainable period of longer term rates … Good if it occurs slowly.
Here is our December 2017 Monthly review. If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast format.
In our post, here and here we discuss the Medicare Means testing levels, both historic and what we are faced with in 2018.
Due to the faster lower Tiers of income, the Social Security Administration has casted a wider net for all of us.
Here are the new levels, again from our post AND in even GREATER details in our Q1 2018 Newsletter.
A life event change may create relief – Life events not limited to the following-
Marriage
Divorce/Annulment
Death of Your Spouse
Work Stoppage
Work Reduction
Loss of Income-Producing Property
Loss of Pension Income
Employer Settlement Payment
Please see our Q1 2018 Newsletter for detailed instructions on how to get relief from these faster grabbing surcharges.
Personal Spring Cleaning in the Winter
Personal Reminder Email Tip
In our post mid-month here we discussed cleaning your emails to lower the Tidal Wave of daily emails.
After almost four weeks we are down to a trickle.
What was most interesting were the different experiences of who was up front and nice about the “Unsubscribe” request and who was down right dirty about letting us off their list. Surprised and disappointed with some companies.
Capital Market Comments
VIX – Fear Index Goes into Hibernation
We initially wrote in our Newsletter article and Blog post here, the VIX went to sleep … after another few closes below 10, we are coining it “Hibernation”
From 1990 to 2016 this Fear index closed below 10 a total of 9 times. During the year 2017, it has closed below that level 52 times and counting !!
Wow … Hibernation!
Interest Rate Increases
Just few years ago, with former FOMC (Federal Open Market Committee) chair Ben Bernanke running the show, a miscalculated mention of a pending interest rate increase threw the Capital Markets into a tail spin – and that was just a mention of one small .25% increase. WOW-
When the history books are written on this period of time, FOMC members “Listening” to markets may be prominent, and possible reason for success.
In 2017, the FOMC raised rates 3 times with very little market disruption. They are on record for 3 more in 2018. The best part of this, market participants are not throwing a hissy fit and seem to be welcoming the increases.
Today, we think NOT increasing the rates as forecasted would cause more harm than increasing – exactly the opposite of just a few years ago. Way to pivot FOMC officials.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investments may be appropriate for you, please consult your financial advisor prior to investing!
Background
The is the vocal portion of J.K. Financial, Inc. a Dallas Texas Based Fee Only Total Wealth Financial Planning Firm. Founded by John Kvale, a Dallas Texas Fee only Financial Planner and Total Wealth Manager.
Annuities etc. □Investment Accounts □Stock Options/Certificates Liabilities □List of Credit Cards with contact information □ Mortgages □Loans Taxes □Tax Returns □ W-2 Forms Identification □ Birth Certificates □ Drivers Licenses □Passports Family □ Adoption Papers □ Marriage License □Pictures □ Audio Files □ Video Clips Property □Titles to Homes, Autos, Boats, etc. □ Warranties Employment Benefits
July 2023 Audio Video Review – RMD Reminder -AI – Cyber – FOMC on the Brakes – Financial Planning and Capital Market Review – By John Kvale CFA, CFP
Hello and Welcome to our July 2023 Financial Planning and Capital Market Update!
If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast audio format as well as Video!
Newbies –
We like to articulate our thoughts and review on a Monthly basis our Financial Planning Tips, Capital Markets thoughts and current events!
Hope you enjoy!
BREAK IN – CLIENTS – Early RMD
July 2023 Video
YouTube
Financial Planning Tip(s)
AI – Artificial Intelligence Update – Great but Not Saving the World
In this timely post (in our humble opinion – IMHO) we revisit the latest rage… AI – Artificial Intelligence – very similar to Dot.com in our opinion… So we try to clarify…
Oh… Here is a GREAT YouTube resource for explaining AI – Christopher Penn a Marketing Expert we have long followed
From the Post:
AI – Artificial Intelligence Today explained
Program assigns a number to all the words in the English Language – other languages too of course.
Cluster of huge computers located somewhere inexpensive scans everything it can get its eyes on, and tags the patterns of the numbers from the words it has scanned…
Not kidding, this is it!
Cyber Reminder –
They are at it again…. Watch out!
Capital Market Comments
Go Powell Go – Rates a 24 Year High – Both Feet On the Brakes!
Careful what we ask for….
Have a Great Day, Talk to You at the End of August !
John A. Kvale CFA, CFP
Share this:
Like this:
Leave a comment
Posted in Audio, Economy, Education, General Financial Planning, Interest Rates, Investing/Financial Planning, Market Comments, Monthly Review, Podcast, Video
Tagged AI, AI Explained, Christopher Penn, Cyber, FOMC, John Kvale, Monthly Review, Rates