Ep145: Reasons for Retirees to be Thankful

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Join Dave and Nick for a special Thanksgiving Episode where they talk about what they are thankful for, the Markets, what’s good for retirees, and financial planning.

We’ve got a lot to be thankful for as investors and financial planners this year despite the fact that it often seems like there’s a lot more bad news going on this year than there was last year. However, it’s kind of the reverse when you look at the numbers. As of this recording the day before Thanksgiving, the Standard and Poor’s 500 -the basic measure of the US stock market – is positive 19% for the year. The Nasdaq, which is focused on tech stocks and over-the-counter stocks, is positive 36% for the year.

If we put these numbers into perspective, really what we’ve done is made up for last year’s losses with some growth. But if you measure that against where people were afraid we were heading going into this year, it’s an astounding difference.

If you would have said in January,  Oh no, the stock market is going to be looking much better by November and inflation’s going to come down and you guys that are all worried about recessions just need to dial it back a bit,”  you would have just sounded like a naive fool. But here we are.

Commodities

So far this year commodities are the only major asset class showing negative returns. Commodities do well in times of worry and inflation.

Some general examples of commodities include, from the Commodity Index, everything from grain futures, energy futures, precious metals, industrial metals, and all the basic inputs that go into creating the economy.

So obviously the markets are having a good year. How does that relate to the economy as a whole?

Well, instead of a recession, third-quarter GDP growth was an annualized 4.9 which is one of the fastest growth rates we’ve seen in decades. Nobody’s expecting it to stay that high, but a recession is thought of as two consecutive quarters of negative GDP growth. Instead, at a time when it was predicted we would definitely be in a recession by now, we’re seeing record growth.

Macroeconomics is very much still an art, not a science.

Listen to the entire episode as Nick and Dave talk about what investors can be thankful for, and plan for the future.

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