I am intentionally choosing to keep a larger, by a mile, than normal amount in the money market, i.e., won't go up but also won't go down in value. As longer-term fixed income investments are a poor choice in an increasing interest rate environment, for now cash is our ideal "shock absorber".
At this time, it is interesting how much, if not all, of the current focus is on inflation and stopping it.
In this month’s Seven Signs Update, (read it here), the independent third party data flow is very clear in how the twelve month YoY inflation must mathematically drop as the high inflation of twelve months ago drops off and is replaced by a lower current inflation input number.
What is not being addressed, that I see, in our media is the root cause of the inflation.
The cause is onshoring a great deal of our manufacturing processes. That will lead to other countries not having our business causing them (China) a great deal of economic pain.
And the supply chain issues that are becoming better each day.
Once the narrative flips to the other side of reality, I have a sense even more money flows to the U.S. for safety, growth and away from deflating economies around the world.
For now, I have two goals; number one, “not make our client family poor” and number two, “we will not fight the Fed”. The Fed will be taking the current Fed funds rate from 2.5% to 4.5% in the next several months. This is a poor choice, but because they are so smart, they have crossed the fine line over into the intellectual idiot category.
Just my observations, I could be wrong, but probably not! :-)
I remain focused, confident, and willing to make changes as opportunity presents itself.
I’m interested in your thoughts, comments and observations. Feel welcome to call, email or stop by the office and say Hi.
James O. Lunney, CFP®
CERTIFIED FINANCIAL PLANNER™ Professional
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 investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. Investing involves risk including loss of principal. No strategy assures success or protects against loss.