The Weekly Wealth of Knowledge is your download of this week's most important topics related to our community, financial planning, the markets and more! As we usher in July, we kick off the theme of "independence." Our content all month long will be highlighting all of the benefits of working with an independent financial services firm like MONECO and ways to pursue financial stability.
In this issue:
- MONECO Insights - Entrepreneurship & Financial Independence (3 min read)
- Thank You Again To Our Beloved Clients! (2 min read)
- Better Than Expected First Half (3 min read)
BONUS: Fairfield Police Sunset 5k - Presented by MONECO Advisors
MONECO Insights - Entrepreneurship & Financial Independence
As we continue with the theme of "independence" all month long, the MONECO Insights team this week looks at how entrepreneurship can potentially help assist with long term financial security. Every entrepreneur, to some extent, decides to choose their own path, read below to determine if indeed it is the correct choice for you and the things you should be aware of before you make the jump. As always, if we can assist in anyway, do not hesitate to reach out.
Thank You Again To Our Beloved Clients!
As we mentioned in a past newsletter, we had the most successful client shredding day last month, where we also encouraged everyone to donate professional attire for veterans returning to the workforce, through a long relationship that MONECO has had with Save A Suit. Last week, we needed more than a few of the team to help load up all of the generous donations that nearly filled an entire UHAUL van! As much as we want our clients to always know that they have a resource to shred and dispose of personally identifiable information to ensure security, we could not have been more impressed by all those that came with suits, shirts and blouses as well. Thank you all again and we can't wait until next year to host this annual event!
Better Than Expected First Half
As we finalize the log on the first six months of 2023, we believe there’s value in reflecting on recent months gone by. Doing so can help crystallize key learnings and help chart a course through the rest of the year. Looking back on the first half of 2023, it’s probably fair to say the outcome has been a bit better-than-expected for the stock and bond markets, especially compared to 2022’s tumult.
So, what major points have we learned through the first half of the year?
- Inflation’s path is not endlessly higher. The return to some post-COVID-19 supply/demand normalcy and an ease in input costs have helped push the inflation rate down—which has helped both stock and bond markets bounce back.
- Still-strong consumer spending and a stubbornly tight jobs market have helped the U.S. avert a recession…so far. The Federal Reserve continued to raise interest rates, but we believe they may begin reducing rates as early as Q4 2023 or Q1 2024.
- Bonds look like bonds again. After enduring a generational period of weakness in 2022, bonds are back and should be considered important ballasts in a multi-asset portfolio.
Given what we have noted so far, we can now focus on the second half of the year. We’ve seen improvement in the bond market and positive returns, and believe there are still plenty of opportunities for both capital appreciation and attractive income generation—assuming both inflation and interest rates continue to glide lower, as we believe they will. For income-oriented investors, the bond market could offer an opportunity that has not existed in over 15 years.
Turning to stocks…the market has already put in some notable gains for the year. With recession risks still looming, investors may consider being less aggressive with their portfolios than they were the first half of the year. This doesn’t means stocks cannot go up from here, but rather that the risk/reward equation in stocks and bonds looks evenly balanced.
The key issue here is recession. We have already seen a push lower in corporate earnings expectations. Some weakening in manufacturing and services indicators, and early signs that the consumer could be slowing down, point to the likelihood of a mild recession to come. This view is reinforced by the expectation that the jobs market could weaken modestly through the end of this year.
Overall, the opportunities in the second half of the year may not be as robust as in the first half. However, after a bumpy 2022, investors should be encouraged that wading back into the market could bear some fruit in the coming months. In fact, the difficulty we witnessed last year likely helps lay the groundwork for further market stabilization as we press ahead. Despite our mild recession outlook, we believe there are still definitive investment prospects to uncover.
As always, if you have any questions, do not hesitate to reach out to the office!
Fairfield Police Sunset 5k - Presented by MONECO Advisors
The 5th Annual Fairfield Police Sunset 5K is Presented by MONECO Advisors and will be held again this year on July 19th at 6:30P.M. All proceeds will be donated to the Fairfield Police Union Scholarship Fund & the Fairfield Police Foundation. You can run (3.1 mile) or walk (1 mile) course. We were able to increase the number of participants to 1000 this year and do expect to sell out, so don't delay, sign up today for Fairfield's most memorable night of the summer! Sponsorship opportunities available via the registration link as well.
This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.
References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.
All data is provided as of July 3, 2023.
Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities.
All index data from FactSet.
The Standard & Poor’s 500 Index (S&P500) is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
This Research material was prepared by LPL Financial, LLC. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
Past performance does not guarantee future results.
Asset allocation does not ensure a profit or protect against a loss.
For a list of descriptions of the indexes and economic terms referenced, please visit our website at lplresearch.com/definitions.
Moneco Advisors, LLC and LPL Financial are not affiliated with any other referenced entity.