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August 22, 2016

The Markets

 

Last week, Wall Street was speculating about monetary policy with the enthusiasm of commentators trying to predict who will bring home Olympic gold.

 

The Federal Open Market Committee (FOMC) is expected to introduce another rate hike before the end of 2016, according to the BBC, and it has just three opportunities to deliver the goods – during its September, November, or December meetings.

 

Analysts and pundits parsed minutes from July’s FOMC meeting looking for clues about timing and found relatively few because there was no consensus view at the July meeting. The BBC wrote, “According to the minutes, some FOMC members felt ‘economic conditions would soon warrant taking another step,’ while others believed more data was needed.” The BBC also pointed out a hike in November was unlikely because of the timing relative to the U.S. Presidential election.

 

The sooner-is-better camp inside the Fed has been quite vocal recently. CNBC reported New York Fed President William Dudley, Atlanta Fed President Dennis Lockhart, and San Francisco Fed President John Williams each made statements confirming solid economic growth is expected during the second half of 2016, and indicating it’s time to continue increasing interest rates in the United States.

 

Recently, the CME Fed Watch tool (which looks at 30-Day Fed Fund futures prices to gauge the likelihood of changes in Fed policy) put the probability of one-quarter to one-half percentage point rate increase during September at 88 percent.

 

That may change this week after Fed Chair Janet Yellen speaks at the Fed’s summer retreat in Jackson Hole, Wyoming. She’s expected to provide some indication of whether the Fed is ready to take action.

 

If you would like more information, just ‘friend’ the Fed. It now has a Facebook page.

 

OUR INVESTMENT STRATEGIES have remained consistent with our objective of achieving our client’s longer-term goals.  We remain focused on active managers that have an “edge” in both the stock and bond market as well as alternative managers that can succeed in a tough traditional investment world.  We have conference calls scheduled with our active managers within the next month and continue to review their expected performances vs. their independent benchmarks.  Our team has been busy developing new “cutting-edge” strategies and we will be rolling out an algorithm based strategy from a new partnership with a Swiss company soon.  Our other focuses continue on modeling portfolios that have investment opportunities from other alternative asset classes such as global macro, event driven stock managers, merger/arbitrage managers, private real estate in the hospitality corridor and more. We are also expanding our index option strategies such as covered calls, put income strategies and option combination strategies designed to hedge portfolios and produce portfolio income.

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Public Wi-Fi is remarkably convenient, making it possible to connect your tablet, laptop, phone, or other device in the middle of a national park, at a local bookstore or café, or while waiting for a flight. Whenever you’re connecting in a public venue, remember public Wi-Fi is not secure – even if you’re paying to access it. Norton warned:

 

“…Wi-Fi uses radio waves. The openness of these signals at public hotspots, combined with the right eavesdropping software, can allow others to take information without your knowledge – much like someone overhearing a private conversation in a crowded restaurant. Don’t assume that a public Wi-Fi network is safe and secure simply because it has a password. Remember, these passwords are shared, so anyone nearby can easily hop onto the network and see what you’re doing.”

 

Protect yourself with some dos and don’ts of free public Wi-Fi:

 

Do:

  • Turn ‘sharing’ Your computer may be set to ‘share’ files and printers or allow remote login from other computers. Make sure ‘sharing’ is turned off when you are on public Wi-Fi.
  • Access only public sites. Check the weather or stock markets. Read the news or your favorite blogs. Avoid sites that require you to login.
  • Use a virtual private network or VPN. VPN software may allow you to route all of your activity through a separate and secure private network even when using public Wi-Fi.

 

Don’t:

  • Assume a Wi-Fi option is legitimate. Cyber criminals have been known to set-up connections with names that are similar to the name of wireless offered by the café, hotel, etc. Talk with an employee before accessing Wi-Fi to get the correct name and IP address.
  • Access password-protected websites. When you’re on public Wi-Fi, do not log in to password protected email accounts or social media sites; do not enter credit card information; and do not engage in online banking.

 

Public Wi-Fi is wonderful – as long as you understand the risks and protect your personal information.

 

Weekly Focus – Think About It

 

“I just work hard and try my best every time I step up on those blocks. I'm very goal-oriented. I've always set high goals for myself. When I was little I never dreamed of going to the Olympics, but once I did I wanted to do my very best at that level. Four years ago, when I was visualizing my final, I never envisaged anything other than winning gold. Once I get to that level, I'm able to set the goals for myself and go out and achieve them.”

--Katie Ledecky, Olympic gold medalist

 

Best regards,

 

Jim Goodland and Team

 

P.S.  Please feel free to forward this commentary to family, friends, or colleagues. If you would like us to add them to the list, please reply to this e-mail with their e-mail address and we will ask for their permission to be added.

 

* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.  However, the value of fund shares is not guaranteed and will fluctuate.

* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.

* The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.

* The Standard & Poor’s 500 (S&P 500) is an unmanaged index. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.

* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.

* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.

* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.

* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.

* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.

* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

* Past performance does not guarantee future results. Investing involves risk, including loss of principal.

* You cannot invest directly in an index.

* Stock investing involves risk including loss of principal.

* Consult your financial professional before making any investment decision.

 

Sources:

http://www.bbc.com/news/business-37111395

http://www.profitf.com/calendars/fomc-meeting-schedule/

http://www.cnbc.com/2016/08/18/feds-williams-waiting-too-long-to-hike-rates-could-be-costly.html

http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/08-22-16_CME_Group_FedWatch_Tool-Footnote_4.pdf)

https://www.bloomberg.com/news/articles/2016-08-20/goldman-says-don-t-bet-on-dollar-selloff-as-dovish-fed-priced-in

http://qz.com/761534/finally-you-can-be-friends-with-the-federal-reserve-on-facebook/

http://us.norton.com/dangers-of-public-wifi/promo

http://lifehacker.com/5576927/how-to-stay-safe-on-public-wi-fi-networks

https://usa.kaspersky.com/internet-security-center/internet-safety/public-wifi#.V6uOzBTp5g0

http://www.aarp.org/money/scams-fraud/info-2016/dangers-of-free-public-wifi-ea.html?intcmp=AE-HP-WFY1

https://action.aarp.org/site/SPageNavigator/FWN_Cyber_Scams.html?cmp=RDRCT-WTCHURWIFI_JUL08_015

http://www.health.com/fitness/katie-ledecky-quotes

 

 

Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Spire Wealth Management, LLC), or any non-investment related content, made reference to directly or indirectly in this commentary will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this commentary serves as the receipt of, or as a substitute for, personalized investment advice from Spire Wealth Management, LLC.  To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.  Spire Wealth Management, LLC is neither a law firm nor a certified public accounting firm and no portion of the website content should be construed as legal or accounting advice.  A copy of the Spire Wealth Management, LLC’s current written disclosure statement discussing our advisory services and fees is available upon request.