The Greatly Exaggerated Death Of The Consumer, Ep #98

2022-09-29

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What's up? It's episode 98 of Payne Points of Wealth and it's officially apocalypse now! The FED will not relent with interest rates. They're going to be more hawkish than ever. It seems like bad news comes on the installment plan, Putin is looking to double down on his war in Ukraine. Is this the end? Is everything going to fall off a cliff? We're going to give you our view today, we're going to tell you exactly what we think you should be doing right now with your money to make sure that you're in the best position given so much uncertainty....

You will want to hear this episode if you are interested in...

The stock market isn’t a video game [1:08]
Two things you can never discount [4:18]
Being properly prepared for a difficult year [8:12]
The Tipping Point [10:20]
Having ETFs in a taxable account [11:31]
The problem with a total market ETF [15:03]
Hidden Facts of Finance [18:37]

The death of the consumer is greatly exaggerated

There are two things that get discounted way too much when it comes to being an investor.

First is American business. Even this year, as we've seen supply chains that are a mess, inflation's been a mess but companies have been able to navigate it relatively well. We've seen more surprises in the positive, not the negative, when it comes to things like earnings.

The second thing that you can't discount is the American's ability to spend. I don't care what anybody says, if you look at retail sales last month, even with 8% inflation, retail sales were up. People were still spending and not just on necessities. They were going to restaurants, they were buying clothes. The bottom line is the death of the consumer is always greatly exaggerated.

This week on the tipping point: Listener Q&A

Our industry tends to come with plenty of cookie-cutter advice so we get a lot of questions because our expertise lies in the planning component of managing wealth. At PCM we focus on customized financial planning. Well, we have a new place where you can submit your questions and we'll answer them here right on the show. Head over to bebullish.com and ask us anything you'd like to hear us talk about on the show.

Today we are answering two questions that have to do with ETFs. The first is from John asking if we recommend ETFs or exchange-traded funds with an expense of 0.25% or even 0.39%? The second question is from Brian who asks if the S&P is so highly weighted with FANG stocks, what's another good total market ETF to invest in during a period of rising rates? Listen now to hear our answers to these great questions!

This week’s hidden facts of finance

Since 1926 the S&P 500 was positive 71 of those 96 years. On a probability basis, the market goes up 74% of the time. That's pretty good odds.
According to bank rate.com, the national average yield on a savings account is a poultry 0.13%. Ouch. Meanwhile, one-year treasury bond pays over 4%.
Pink Floyd's, The Dark Side Of The Moon, hit number one on the Billboard Album Chart for exactly one week in 1973. It has since gone on to sell 45 million copies and has spent 960 weeks on the charts.

Resources & People Mentioned

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