Hello and welcome to our Market Alert video for today, which is August 23, 2024 and I hope this video is reaching you and you are healthy, wealthy and wise. And for you all in SCWper nation, I hope you are out there, SCWPering your tails off and enjoying your second childhood without parental supervision. That’s your job. Our job is to worry about all this stuff for you so that you don’t have to. And there are some things to worry about. We got a jobs revision number, which was wow. And so we’ll go over that with you here in just a minute. But before we get going, I got to tell you something that really cool that happened. My middle daughter, Aubrey, came to visit, spent four days with us, and she actually when she was in high school, she played college tennis. When she was in high school, she was nationally ranked. She was a terrific player, and of course, I was the obsessive tennis dad, and I practically drove her out of tennis with my obsession to turn her into a Wimbledon champion. And so about her senior year in high school, she banned me from attending any of her tennis and she wouldn’t play with me anymore. So I was like in tennis jail. And so she came to visit, and for the first time in almost 10 years, maybe even 15, we actually played tennis together, and it was fun. We didn’t keep score. I didn’t coach her, I kept my mouth shut. I was being a good dad, and we actually had a nice time together. So one of those things that, you know, a milestone, I’ll say that maybe now we can play together without all the baggage. Anyway, let’s talk about what happened. Oh my, jobs revision. They revised the number of jobs that the economy created downward by 1 million jobs, a million. Like, are you kidding me? A million? What do you – how do you miscount by a million jobs? Unbelievable. So brings into question whether the Labor Department is on top of things or not, but certainly, what it does is it kind of changes the complexion of where we go from here, what it looks like. Okay, so as you guys know, if you’ve been watching our videos, is that over the last several months, the economy has been slowing down at an increasing rate. So the momentum has been building. And the reason why nobody’s panicked is because jobs were plentiful. People had jobs, and we were seeing all this stuff happening. It was great. And so the idea was that, you know, as long as jobs hold up, the consumer is 70% of our economy. If they have a job, they go spend. And so everything is nice. Inflation is coming down, the economy is slowing, but the consumer is okay. And so that was good. Well, last week, we talked about, is all of this too good to be true? And it may. It may, in fact, be the case now that we find that there’s a million less jobs than we thought. So what that means is, is that if the consumer is losing their jobs and we’re not creating as many jobs as was before thought, then the underpinning that was holding up the economy may be crumbling, and if that starts to accelerate, then what’s going to hold us from having a recession? Basically, not much. And so therefore that is now we think going to be the concern going forward. So what do we do about that? What does that mean to us? Well, again, you know, we’re students of history, and we always like to say that if you don’t study history, you may be doomed to repeat it. And so back in the early 80s, Paul Volcker, who was the Federal Reserve chairman at that time, he raised interest rates all the way up to 16%! Can you even imagine that we’re talking about 5% now we’re worried about that. 16% to fight inflation. But then he waited too long to lower interest rates, and so the economy went into a terrible recession. We had unemployment, we had pain. The stock market crashed, we had a terrible time. And so that possibility certainly is rearing its ugly head. But we want to tell you, let us worry about it, don’t you. It’s not your job. Your job is to go out and SCWPer your tail off, right? That’s it. Let us do the worrying, and that’s why we have our sell strategy. If, in fact, this does turn into something like in the early 80s, our strategy should help us to avoid any significant losses, and, in fact, take advantage of the big down that could come after that. So we look at it as an opportunity if it does happen. So on the stock side, there’s two ways this can go. One is the economy is slowing down, jobs hold on, and the stock market loves that, because the Fed’s lowering interest rates at the same time. The other side of it is, is that the Fed’s lowering interest rates because things are bad. We’re going into a terrible recession. And if that happens, then stocks will not like that. And as I said, we have a strategy to address that. Now on the bond side, we continue to say that we think this is going to be a historic bond market rally. We think the bond market is going to do far better than the stock market over the next six months. Why? Because as the Fed lowers interest rates, the value of bonds goes up, and we’ve already seen that so far this quarter, our bond portfolio has outperformed our stock portfolio, and it’s what we said would happen, and we think that will continue. So bonds are going to be a very good place to be, regardless of the reason why the Fed’s lowering interest rate, either because it’s good news or bad news, we think they are going to lower interest rates, and this new jobs revision, we think is going to lock in the perhaps three rate reduction starting in September this year. So that’s where we are. I hope that you have peace of mind. I hope this, what we’re telling you here is only to inform you, not to worry you, right? We want to worry about this for you, and so share this video with your friends, your family, and remember, we now have our podcast. So make sure you subscribe to the podcast as well. And if you don’t know how to do that, talk to your retirement planner. We want to help you to get that set up and subscribe to so you can get the show every single week and never miss it. So thanks for watching. Share this with your friends and family, and we’ll talk soon. Bye.

Please note: transcript has been modified after the time of recording. 

Economic indicators and stock market performance cannot be predicted. Opinions expressed regarding the economy and the stock market belong solely to Ken Moraif on behalf of Retirement Planners of America and may not accurately portray actual future performance of the economy or stock market outcomes. Opinions expressed in this video is intended to be for informational purposes only and is not intended to be used as investment advice for individuals who are not clients of Retirement Planners of America. All content provided is the opinion of Ken Moraif, CEO and Founder of RPOA Advisors, Inc. (d/b/a Retirement Planners of America ) (“Retirement Planners of America”, “RPOA”). ©Copyright 2023