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• There’s an old expression that says that people in the financial services make their money in bull markets, but they earn it during bear markets.
• Right now, we feel like we are earning it!
• We aren’t in a bear market yet, but it is certainly possible.
• There’s an old axiom that says the job will always take the time allocated to it.
• Trump has created a 90-day window, so we think it will take at least 90 days to finally come to terms.
• Between now and then, we are anticipating a lot of volatility as headlines say negotiations are going well and then say negotiations are going badly.
• We think all these tariff things will be resolved in the 90 days with our allies, but the negotiations with China will be more complicated and probably take longer.
• We believe our existential enemy is China, and that China does not have anything good planned for us.
• To a great degree, China politically and economically controls almost half the world.
• They do not want to be seen bending the knee to Donald Trump.
• Therefore, they are going to drag this out and use weapons we may not have been prepared for.
• The market is probably going to react very negatively to that at times as well.
• Eventually, an agreement will be made, and this will come to an end, in our view, but it will take longer than 90 days.
• There’s a phenomenon that happens in the market called “head and shoulders.”
• Basically, the market goes down, recovers big, and then goes back down again.
• We’ve seen the big down, we’ve seen the big up, but we haven’t seen the big bad down again that retests the lows that we were at before.
• With all the uncertainty, we think it’s a normal process the market goes through.
• The Federal Reserve came out this week and said they are not going to do anything with interest rates.
• Jerome Powell said that tariffs are inflationary in the short run so they don’t think lowering interest rates is a good idea right now.
• The Federal Reserve has a conundrum because their job is to keep inflation under control, and if we do have a recession and we have inflation, then the Federal Reserve is in a very tough place.
• Lowering interest rates to combat the recession will cause inflation, and raising interest rates to combat inflation will cause the recession to become worse.
• They most likely will side with fighting inflation, since it’s harder to get rid of than recessions.
• That means they probably will not come to the rescue by lowering interest rates if we head into a recession.
• The yield curve has predicted every recession we’ve had in the last 100 years.
• Before we get too excited, it has also predicted recessions that didn’t happen.
• Right now, it is inverted, meaning it’s saying a recession is coming.
• What does this tell us about the actions we’ve already taken and where do we go from here?
• We are thankful that our Invest and Protect Strategy said it was time to get out and we have gotten out with half of our stocks and half of our high yield bonds.
• We think that is the right place to be.
• This whole thing will probably play itself out, but it could get ugly before then.
• We want to mitigate that downside for you by being defensive, but we also want to be well positioned to take advantage of the rebound when it comes.
• We don’t know when that will be, but we think it will probably come somewhere around the middle of this year if not sooner.

Hello everyone, and welcome to our Market Alert video for today, which is April 18, 2025. I hope this video finds you healthy, wealthy and wise. And for all of you SCWPerS out there, I hope you are out there SCWPering your little tails off, enjoying your second childhood without parental supervision and having that peace of mind we want you to have. And for those of you who are not SCWPerS yet, who are not retired yet, then we want to get you there, and we will do everything we can, and certainly during times like these. You know, there’s an old expression that says that people in the financial services, financial advisors, they make their money in bull markets, but they earn it during bear markets. And so right now, I feel like we are earning it, not that we’re in a bear market yet, but it’s certainly possible. So thanks for watching. I hope you are all doing great. This week, we’re going to talk about several things. First, 90, days will take 90 days. Secondly, we’re going to talk about China, the wild card, we think the biggest wild card in all of these tariff things that we’re dealing with. Also, we’re gonna talk about head and shoulders, and not the shampoo. And also we’re talking about the Federal Reserve, our knight in shining armor. Are they gonna be able to come to our rescue again? Or maybe this time, they won’t. And then we’ll visit again about the yield curve, the best predictor of recessions that we have been 100% accurate over the last 100 years. And what is it continuing to tell us? So we have a lot to dive into and get into. First of all, I want to thank all of you that are asking me about how my knee is going. Well, you can tell I’m not laying in bed right now. So that’s the first clue, the recovery is going well. I went in for my post op, my two month post op, and they said, You are released. So now I’m going to be doing some elliptical work, a little bit of strengthening. And you know, my knee was done on February 25 so my goal is, I’ll say June, late June, early July, to be back on the tennis court. So I can’t wait to do that. I actually dream about playing tennis with no pain. It’s insane how much I love that sport. So let’s talk about the 90 days will take 90 days? Well, there’s an old axiom that says that the job will always take the time allocated to it. And if you think about how true that is, I mean, even, like the debt ceiling, things right, there’s a deadline, and it goes right up until midnight of the deadline before they finally come to terms. Things take the time that is allocated to it. And so Trump has said that these things, we got a 90 day window, they’re going to take 90 days. Now, we’re actually dubious whether all this will be resolved in 90 days. We think it could go longer, but in theory, it’s 90 days. So what’s going to happen between now and then, we think is a lot of volatility, because as negotiations go well and then go badly. Headlines are going to say, Oh no, it’s falling out of bed, oh no, oh yes, it’s going great. And we’re going to see a lot of headline reactions by the markets. And so we’ll have a lot of volatility between now and then, something we’ve kind of be used to. I mean, now the market goes down, up or down 2% and we’re like, oh, okay, kind of a calm day when, in the past, that might have been historic. So it’s crazy what’s going on. So, yeah, so 90 days, let’s talk about China. So China is different than our our allies, our friends. You know, they’re despite the fact that we’re in negotiations, and we have all these tariff things, we’re still allies, and our common enemy is China. And we believe our existential enemy is China. We don’t think China has anything good planned for us. And so China, you know, basically, politically and economically to a great degree, controls, you know, maybe half the world. And so they can’t be seen bending the knee to Donald Trump. That’s just, they can’t do that. And so therefore, the for them to do that, you know, they’re going to drag this thing out. They’re going to use weapons that perhaps we have not been prepared for. And so there are going to be a lot of times when the market is going to react very negatively to that as well. Now we do think that eventually there will be an agreement and all this will come to an end. But how long it will take with China? We think it’ll take longer than the 90 days. Now there’s a phenomenon that happens in the market that is called Head and shoulders. So basically what happens is the market goes down, and then it goes up, and I’ll follow my head here, and then it goes down, and it goes to this shoulder, right? So head, it’s a shoulder, head, shoulder, and that’s what we and basically it means the market goes way down, recovers big and then goes back down again. And we’ve seen the big down, we’ve seen the head the big up, but we haven’t seen the big bad down again that retests the lows that we were at before. And we think that with all of the uncertainty that all of this stuff is bringing, that we will have that revisit. So just going to give you an advance so you don’t panic. We think it’s a normal process that the market goes through and has gone through many, many times. The other thing also that I want to talk with you about is the Federal Reserve. So the Federal Reserve this week came out and said that they are not going to do anything with interest rates. Jerome Powell said that tariffs in the short run are inflationary, and therefore they don’t think lowering rates is a good idea right now, but in some there’s a lot of uncertainty. They don’t know what’s going to come of all of this. And he said, we can afford to wait, and therefore we are going to Okay. So the Federal Reserve, our knight in shining armor that always saves the day for us has done so for the last two decades, basically has said we’re out of the game for now. Now they have a conundrum the Federal Reserve, because their job is to keep inflation under control, and tariffs in the short run are inflationary. Now, long run, probably not. But in the short run, yes, so and if we do have recession, which we’ll talk about the yield curve in a minute. But if we do have recession and we have inflation, then the Federal Reserve is in a very tough place, because lowering interest rates to combat the recession will cause inflation, and raising interest rates to combat inflation will cause the recession to become worse. So they most likely will side with fighting inflation, since it’s harder to get rid of than recessions. And so probably they will not lower interest rates and come to the rescue if we head into a recession. So you take them off the table, and it becomes kind of dicey. So the other thing, of course, is the yield curve, and it has predicted every recession we’ve had in the last 100 years. Now, before we get too excited, it has also predicted recessions that didn’t happen. So we don’t want to get too excited with it, but it’s very accurate. And right now, as we’ve spoken to you about in previous videos, it’s inverted, meaning it’s saying a recession is coming. So what does all of this tell us with regard to where we go from here and the actions that we have already taken? Well, one thing it does tell me is I’m thankful that our strategy said it was time to get out, and I’m thankful that we have gotten out with half of our stocks and half of our high yield bonds. So basically, we are two thirds of out of the market for most of you, and we think that’s the right place to be. We think that this whole thing is going to play itself out. It’s not a permanent condition, but it could get ugly before then. And we want to mitigate that downside for you by being defensive, but we also want to be well positioned, you know, to take advantage of the rebound when it does come. And we think that it we don’t know when, but we think it will come probably somewhere around the middle of this year, if not sooner, because we don’t think that all the tariffs, the China thing may last longer, but with the Europeans, the Canadians and the Mexicans, we think those will be resolved, probably within the three to six months. So because of that, we think that we are well positioned right now in our defensive mode gives me peace of mind. I know that, and I hope it gives you that same peace of mind as well. So that’s where we are, tenuous times, for sure, but let us do the worrying for you so that you don’t have to, you know, we want to worry about all this boring financial stuff. Let us get the gray hair. And I think I’ve got a few more this week, and probably more next week. I’m going to be completely gray by the end of this, this tariff thing. So again, thank you for watching and please like and subscribe to this video. It’ll help us out a lot. Share it with your friends and family. We want to help as many people navigate these times as possible, and they’re probably scared to death right now. Send them our way if they are. We’d love to visit with them and give them some peace of mind. So thanks for watching, and we’ll talk soon.

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