Natalie Pace Blogs
Photo of Natalie Pace by Marie Commiskey. Avalon Photography.
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 Facebook AI image of an ancient castle. 9 Money Secrets of the Ultra Wealthy There are families who manage to keep wealth over centuries. Alnwick Castle, the 2nd largest inhabited castle in the U.K. behind Windsor Castle, has been home to the Percy Family for 700 years. (We know it fondly as Hogwarts in the Harry Potter movies.) Has the same family owned the biggest house in your hometown for centuries? Why is the Hearst Castle owned by the State of California? It has been posited that 70% of us will lose the family wealth in the 2nd generation, while 90% is lost by the 3rd. (There have been data scientists who dispute this.) Whether it is poor stewardship, high taxes, shoddy legacy planning, or dilution, one thing is sure: the only way that the wealth stays in the family throughout the ages is through a carefully crafted plan that all of the family members understand and buy into. The U.K. and most European countries have higher tax rates than the U.S., so understanding how to limit taxes is a huge piece of the puzzle, particularly when most billionaires pay a much lower tax rate than working folks, and sometimes no taxes at all. Below are 9 money secrets of billionaires and royals, with a link at the end of this blog to an additional ten tips. Here are the tips we’ll cover in this blog. Managed Plans Do What the Markets Do 7 Companies are Taking Wall Street to New Highs Peter Thiel has 5 Billion Dollars in a Roth IRA Legacy Wealth Plans 100 Years in Advance Paper Losses are Still Losses Keep the Money in the Family Partnership and Community Be the Boss of Your Money 10 Additional Wealth Secrets And here is additional information on each point. Managed Plans Do What the Markets Do The majority of managed plans do with the markets do, as do most of our retirement plans. That means that 2023 should have been a great year in stocks for most of us (+26% in total return in the S&P500), while 2022 was a terrible year with -19.44% losses.   You might think that makes a strong case for Buy & Hold. However, the only way we made back 2022 stock losses was if we were invested in the Magnificent 7 companies. (Learn more in the tip below.) Also, 21st Century recessions sink steep, rapidly, and take years to recover, making Modern Portfolio Theory and regular rebalancing an important part of a protected wealth plan. This time-proven, 21st Century plan earned gains in the Dot Com and the Great Recession, and outperformed the bull markets in between. In between October 2007 and March 2009, the Dow Jones Industrial Average lost 55% dropping to a low of 6537. It took years to recover those losses. Most investors spent the first part of the bull market crawling back to even, while many others were too shell-shocked to invest until stocks were hitting highs again. The plunge was even worse in the Dot Com Recession. Between March 2000 and October 2002, the NASDAQ Composite Index lost -78% and took 15 years to come back. That means that $1 million dropped all the way to $220,000. If you had a plan in either recession that lost a significant amount, and you haven’t made any changes, now is a good time to consider receiving an unbiased 2nd opinion. Email [email protected] to learn more. 7 Companies are Taking Wall Street to New Highs There are some similarities of the Dot Com Recession to today’s market. For one, equities are very expensive. As you can see in the chart below, the only time that stocks had a higher price was in the Dot Com Recession (when Dot Coms lost -78% of their value). (Prices are higher today than before the Great Depression.) As just one example, Nvidia (a popular AI company) has net income of $30 billion and a market value of $3.3 trillion (as of 10.10.2024).  Source: Robert Shiller, Ph.D., Nobel Prize winning economist, professor, Yale. The second thing is that only a handful of companies are responsible for almost all of the gains. If you did not have a large growth fund in 2023, which includes the Magnificent 7 companies, you didn’t recover the losses of 2022. The S&P 500 return without the Magnificent 7 was only 9.99%. This is why we diversify into 10 different slices in our sample nest egg pie chart. Large, mid, and small caps, value and growth, and four hot slices. We want that extra performance that the growth funds and hot industries provide. We also need an age-appropriate plan that is protected from principal losses (even paper losses). It’s key to know this by reviewing the information, not just by having blind faith in what we’re being told. How do you learn our time-proven 21st Century strategy, or make sure that your financial partner is offering you an age-appropriate and diversified plan? You can read about it in The ABCs of Money 6th edition. You can learn and implement it in our Financial Freedom Retreat October 18-20, 2024, and our Bonds & What’s Safe masterclass Oct. 26, 2024, (online). You could also get an unbiased second opinion through my private coaching program. Email [email protected] to learn more. Peter Thiel has 5 Billion in a Roth IRA Rich people don’t put their money in jars. Tax strategies of the wealthy include knowing how to put their money to work without paying capital gains taxes. Many of us are not thinking (or aware) of all of the ways that we could protect our wealth from capital gains taxes, income taxes and losses (even paper losses) – sometimes even while receiving tax credits. Most of us should have a plethora of accounts building wealth for us while we sleep, including our:
Legacy Wealth Plans 100 Years in Advance There are European families, such as the Percy Family and The Royal Family, who have kept their wealth, even in very highly taxed countries, for centuries. How did they do this? They think and plan 100 years in advance. They also keep the money in the family, know what they own, monetize their land, hold regular family wealth planning meetings, and begin the transfer of wealth when their kids are still teens. Everyone receives financial literacy training. FYI, this is one of the reasons why I host the Restormel Royal Manor House Retreat every other year. When you live for a week in a manor house that has been there since the 1700s and visit the castle that has been there since the 1100s, wealth takes on a completely different perspective. The lessons that we teach at the retreats and master classes sink in viscerally, and our vision expands exponentially. Paper Losses are Still Losses The reason that most people don’t buy low is that they can’t. 20 million Americans (or more) were struggling to save homes and recover nest egg losses in the Great Recession. Few had any resources or stomach to invest in the recovery and purchase at bargain prices. Planning ahead and protecting our wealth affords us both of those necessary means – the financial and the emotional. Paper losses are also an impediment to buying low. In order to free up the capital to make a purchase, we must lock in the loss. We might have to borrow at a higher interest rate because our net worth and FICO score plunges with “paper” losses. This is why we must always know what we own and why – so that we can protect our principal in an age-appropriate way. As mentioned above, most managed plans do whatever the market does. In the Dot Com and the Great Recessions, both real estate and stocks dropped precipitously. Are we betting that stocks and real estate never go down? The bond market held up pretty well in both of those recessions. However, this time around credit and duration risk are more elevated, while interest rates are not predicted to fall nearly as low. (Time will tell; economic forecasts are always uncertain.) Most people lost -26% or more on their principle in long-term government bonds in 2022, and those losses weren’t made up in 2023. Credit and duration risk remain elevated. Learn how to earn a safe, steady yield in our Bonds & What’s Safe masterclass Oct. 26, 2024, (online).  FYI: We were encouraging investors to lean into real estate instead of bonds between 2009 and 2015 – a strategy that doubled in value for many, while avoiding the paper losses altogether! Wisdom, data and information are powerful. Paper losses can become real losses. We can get into a liquidity crunch, and our FICO score drops. If the bond duration is a long period of time, the company or sovereign itself might have to restructure. The duration might be longer than our life span. We’ve seen a cycle of debt restructuring in the airline and auto manufacturing industries. In 2011, Greek bondholders took such a haircut that MF Global went bankrupt. The key is always to know what is in favor and what is risky before it happens. We’re supposed to protect our principal on the safe side, not reach for yield. Many private clients ask, “Who is loaning money to these companies that are at the lowest level of investment grade and are so risky?” without realizing that we (Main Street investors) are the ones loaning the money, in our retirement plans, our insurance plans and even our managed wealth plans. Big banks make a lot of money selling fixed income products to Main Street investors. Fiduciaries sometimes buy them for clients without advance notice, particularly if they’ve been authorized to do so. Keep the Money in the Family I often mention that Prince William didn’t buy Kensington Palace, or that King Charles didn’t purchase Windsor Castle. Many Main Street folks laugh, and say, “Well I’m just not that rich.” However, the lesson I’m trying to underscore has less to do with being a billionaire, and more to do with adopting the strategies of the ultrawealthy, which are available to all of us. Imagine how financially advantageous it is for us to keep the money in the family and stop making landlords rich at our own expense – a key strategy employed by a great deal of very rich folks. If we add up all the money that each one of our kids and our parents are spending every year on housing, particularly with today’s extremely high rents, that could be $100,000 or more annually. (3 family members spending $2500/month on housing = $30,000 each or $90,000 annually.) With that kind of dough, we could all live in a mansion so big we wouldn’t have to see each other without setting up an appointment. You can learn more about housing and budgeting solutions in my recent blog and in my upcoming videoconference on Thursday, Oct. 17, 2024. Email [email protected] with VIDEOCON in the subject line to join us live. Watch it back (and subscribe so that you catch all of my free videoconferences) at https://youtube.com/nataliepace. Partnership and Community When the Twin Towers fell in Manhattan, first responders flew in from all over the world to support the recovery efforts. As we encounter one of the worst hurricanes ever seen in Florida with Hurricane Milton, it’s important for all of us to have empathy for those affected by natural disasters, and to offer support in the recovery and rescue efforts. Life is full of achievements and challenges, and both require partnerships and communities. No grand achievement is ever accomplished by oneself. In our darkest hour, it’s often someone else who carries the light and helps us to weather the storm. I want to share with you other examples of great achievements. From 1987 to 2019, Costa Rica doubled its forest cover from 26% to over 52%, thanks to rigorous reforestation initiatives and incentives for landowners to plant trees. The country powers 98% with renewables and ensures that all citizens are eco-educated and incentivized to preserve biodiversity and live green. Poundbury, Dorset, England was built according to the vision for Britain of King Charles III. It has attracted sustainability folks from around the U.K. to its community. Damers First School, under the leadership of former eco coordinator Edd Moore, became one of the best examples of a green school in the world. Damers has received awards from Jane Goodall‘s Roots & Shoots program, from the UK’s Eco Schools program, from Surfers Against Sewage, and so many other organizations who recognize the power of educating children on nature and the environment. The 5 to 9-year-olds at Damers First School:
You can watch some of the great work being done by schools in the Kids episode of our Earth Gratitude 5-part docuseries. Earth Gratitude is another example of partnership and community, with contributions from H.M. King Charles III (when he was The Prince of Wales), H.H. The Dalai Lama, Sia, Ed Begley Jr.,XPRIZE, Wangari Maathai, Arianna Huffington, The Duchess of Northumberland,Deepak Chopra, EARTHDAY.ORG, Ron Finley, the NRDC, Global Green, Lynne Twist, Green Our Planet, Life is Good, Master Sha, Leon Krier, Kiss the Ground, Nathalie Kelley, 4p1000.org, Alice Waters, The Edible Schoolyard Project, H.M. Queen Diambi, The Pachamama Alliance, WildlifeDirect and more. . Be the Boss of Your Money A bond manager had to report daily to her billionaire boss. The vice chairman of an investment bank still has to politely turn down the sales requests of his banker to get into long-term Treasuries for the “income” (even though he’s the expert and she’s the salesman). As Joe Moglia, the former CEO and chairman of TD AMERITRADE is fond of saying, “No one cares more about your money than you do.” In bull markets, our financial advisors will look like geniuses. In bear markets, we’ll think they are jerks. In truth, we should always be the boss of our money and know what we own and why. Gains are ours to keep, as are losses. The broker-salesman gets paid either way. Now, with stocks and real estate still hitting new highs, is a great time to fix the roof while the sun is still shining – to protect our wealth before any economic storms arrive. 10 Additional Wealth Secrets While some nouveau riche (particularly athletes and lottery winners) fly high and crash, others can completely transform the trajectory of generations to come. A focus on education has made Asian Americans the top U.S. household income earners. Learn 10 additional wealth secrets in my 2023 blog on Wealth Secrets. Bottom Line People don’t get rich or stay rich by accident. Most of them employ the legal means and wealth secrets listed above -- which any of us can adopt to live a richer life. When we are struggling to survive it is hard to imagine that a complete money makeover could change everything. However, I can attest personally that adopting these wealth strategies leads to greater wealth, a much richer life, and the ability to enjoy the flow of money instead of feeling like it flies out the window all the time. Is it possible to love paying your bills? Certainly not if you really don’t like the things that you spend money on. However, when you erase the board clean of what you believe life has to be, and dream of what you would like it to be, that is when we can move forward to make the necessary changes to build and sustain the life of our dreams. There are a lot of secrets, strategies, and tax advantages available to all of us. Contrary to popular beliefs, earning more isn’t the ticket out of the rat race. (Earned income is taxed at the highest rate!) It’s investing more and wasting less, combined with partnering up to keep the money flowing in our family and communities, and to stop making billionaires and entrenched, outdated corporations rich at our own expense. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Pace, Lauren Anderson and Linda Bjork at a 21 Leaders Gala honoring Melanne Verveer and other leaders. Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Housing & Budgeting Solutions. Will Boeing Be Booted Out of the Dow Jones Industrial Average? Arkansas Sues Temu for Data Theft. We Must Be the Boss of Our Money. Why? Oil Prices Tumble. Why? Sweepstakes for the Release of The ABCs of Money. 6th Edition. Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.
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 Photo: Natalie Pace on Good Morning America (with her son) being interviewed by Diane Sawyer. She was there to discuss how a simple co-housing solution (CoAbode.com) was helping her to save thousands of dollars every year, while also giving her countless more personal time. Housing & Budgeting Solutions. 7 money secrets of the wealthy that could save all of us tens of thousands of dollars every year. Below are the topics we will cover in this blog. If you’d like to join me live on Thursday, Oct. 17, 2024, at 4 pm PT, email [email protected] with VIDEOCON in the subject line. Be sure to check out our Natalie Pace channel on Youtube for all of our free videoconferences and Substack for the podcast on this topic (after Oct. 17th) at https://youtube.com/nataliepace and https://nataliepace.substack.com/. Subscribe there so you don't miss a thing. Think Bigger Slash the Big-Ticket Bills Partner Up Be Careful of Buying High Simple Math Can Be Very Deceiving Rampant Fraud & Deception When You Search for a New Mortgage How Low Will Interest Rates Go? Here is more information on each point. Think Bigger There are many ways that we need to think bigger to exit the rat race. One way is to understand that we can be very frugal and still be struggling to make ends meet. Most of us are not shopaholics. If we’re under the age of 40, we might be spending 30 to 50% of our income on housing, and there are a lot of other expenses to try and fit in, including transportation, food, health care and insurance. If we move to a more affordable city, chances are wages will be lower while our commute costs could be much higher (particularly if it lengthens our driving time to the office). For many of us, buying instead of renting could be even more expensive, even if the simple math suggests otherwise. I’ll discuss that in the simple math topic below. Once we acknowledge that the sinkhole in our budget is not going to be fixed with curtailing café lattes, we can tackle the real challenges of living in the 21st Century. Life doesn’t add up. We must think creatively to make ends meet. We have to find ways to lower our personal costs of housing, transportation, medical insurance, taxes and other big-ticket bills that are weighing on our household finances. Slash the Big-Ticket Bills This was a game changer for me personally. I would definitely not have the career I have if I had not found a way to cut costs. Increasing income is what we always think we need to do. However, finding ways to keep more of our money, and invest, save and spend it on things we truly care about is the real game changer. I’ll discuss how to dramatically reduce housing costs in the point below. There is an entire section of Real Estate in the 6th edition of The ABCs of Money devoted to informing us on this topic. Most of us are spending $9000 or more a year on each car we own. Many families spend $10,000 or more a year on health insurance. Main Street gives up a great deal more of our income in taxes (percentage-wise) than most billionaires do, while many of the strategies they employ to lower their taxable income are available to all. (Peter Thiel reportedly has $4-5 billion in his Roth IRA – an amount that is exempt from capital gains and income taxes, unless the laws change.) There are creative solutions that could dramatically reduce all these expenses. You can read about them in the 6th edition of The ABCs of Money. You can learn and implement them by attending our Oct. 18-20, 2024 Financial Freedom Retreat. You can also receive private coaching and a money makeover from me privately. Email [email protected] or call 310-430-2397 to learn more.
Partner Up Rich people plan 100 years in advance. They are thinking about their parents, and also their great grandchildren. What would happen if all of us were looking at money from a multigenerational perspective? Could we keep more money in the family, instead of making the landlord rich? A mortgage interest rate that’s under 4% is an asset. However, that valuable holding could be at risk if it is attached to a home that someone can no longer afford. Can we keep both with a multigenerational family plan, where everyone wins? If we add up all the lodging costs of everyone in our immediate family (three generations), the total could easily be in the hundreds of thousands every year – money that is flying out the window to make other people rich. (Four people paying $2,000/month equals $96,000/annually.) When we think bigger and partner up with family members, friends, or natural alliances, we can secure more space, a better neighborhood, and save up to half of our housing costs. Many two-bedroom apartments cost only a few hundred dollars more per month than a one-bedroom. Grandparents are ready to downsize at the time that their grandchildren need a bigger home and a better neighborhood for school. Adding an ADU* to the backyard could be an affordable and advantageous housing option, particularly as the aging process reduces mobility and other functions for elders. Some states offer grants for ADUs, while cities often fast-track permitting. *Accessory Dwelling Unit (granny flat) Single moms who team up together can save up to $19,000 per year (per family) and have substantial more personal time each week. That is according to research done by CoAbode.com. Check out my interview with the CoAbode.com founder and CEO Carmel Boss at YouTube.com/NataliePace.  Data and research provided by CoAbode.com. When we reduce our housing costs by a third or more, we can save up to buy our own home, or perhaps even save our family home, if our parents are in need of downsizing. Be Careful of Buying High When we get married or start a family, it’s quite natural to think of owning our own home. However, real estate prices are at an all-time high. Buying high in real estate, especially if we’re stretching our budget in order to do so, can be one of the most devastating financial choices we ever make. During and after the Great Recession, over 20 million people lost their homes.  All those families experienced a period of 5-10 years (or longer) of grave financial hardship. For some, the stress cost them their health, while others couldn’t save their relationship from the fallout (in addition to losing their home). Real estate is an illiquid investment. Once you own it, it can be difficult to unload it. So, it’s important to have all the facts in front of us before we decide whether buying a home right now is the best option. We should cast our vision out at least ten years to determine whether this particular area and dwelling is going to be right for us as our family ages. Simple Math Can Be Very Deceiving Up to 82% of people surveyed over the last two years have buyer’s remorse, according to a Clever Real Estate survey in May of this year. Over 40% are struggling to pay their mortgage and have taken on debt since the home purchase. There is a lot of simple math going. People are being told that they could own a home for less than they are renting because rental costs are so high. However, that rudimentary equation, which is really a sales tactic, is often missing the remodeling costs, property taxes, closing fees and commissions, escalating insurance costs, climate change, and other terrifying surprises that can happen when the deed transfers to our name. There is a 10-point checklist in the Real Estate section of the 6th edition of The ABCs of Money that is essential to go through before buying or selling your home. If you’re thinking of selling, be sure that you are thinking of future generations. Don’t do the simple math and think, “If I sell it, I’ll make a boatload of money.” With inflation and high interest rates, money buys a lot less these days. With high home prices and interest rates we might be purchasing less home for a higher price. Additionally, banks were failing in 2023 (with another one down in 2024), bonds lost more than stocks in 2022 (-26%), and stocks fall hard and fast in recessions. There are a lot of ways that we can get separated from our pot of gold.  If you’re ready to purchase, is it possible that the best purchasing plan could be right under your nose by teaming up with a family member who is in need of downsizing and could use the steady fixed income? Rampant Fraud & Deception When You Search for a New Mortgage On October 3, 2024, Bob Broeksmit, the Mortgage Bankers Association President and CEO, issued a warning. Online searches for mortgages have been triggering a barrage of unwanted emails, texts and phone solicitations, some of which have resulted in fraud. The scam artists often pretend to be from the bank that has approved the loan. I encourage you to read this important alert from the MBA, and to always be on alert of just how sophisticated these ruses have become. How Low Will Interest Rates Go? I recently had a coaching session with a client who is chomping at the bit to refinance, who wondered just how low rates can go. So, what are the FOMC members projecting? According to the Summary of Economic Projections that was released on September 18, 2024, the Fed Fund Rate is predicted to land at 4.4% in 2024, 3.4% in 2025, 2.9% in 2026 and 2027, and have a longer run rate of 2.9%. 2.9% is low, but considerably higher than the zero percent interest rates that investors enjoyed (for the most part) between 2009 and early 2022. Of course, projections can change. However, knowing the trend is expected to be down over the next two years gives would-be home buyers and refinancers a timeline to keep in mind.  Incidentally, lower interest rates punish savers and fixed-income retirees. In a highly leveraged Debt World with falling yields, how will we earn income without putting our principal at risk? That is one of the reasons why we are hosting a Bonds & What’s Safe Masterclass on Oct. 26, 2024 to offer resources, strategies, tips and perspectives for keeping our money safe, while earning some income. Bottom Line Housing costs are unaffordable, and life is too expensive. We can drown in debt waiting for the politicians to fix things. (Debt is at an all-time high for consumers, corporations and the country.) This situation has been building up for over a decade – even before the pandemic. The perfect time to purchase a home would have been in 2011, when real estate prices were at rock bottom. However, when twenty million people are struggling to figure out how to sell their home, no one is in a position to buy. Most of us don’t buy low because we can’t. We don’t have any money and might be having a fire sale ourselves to try and stay afloat. That is why it is very important for us to develop and employ a big-picture, long-range plan with regard to our retirement accounts, checking, savings, investments, trading, housing, and strategic bill paying. When we stop making the tax man, the landlord, the gasoline station, the insurance salesman, the utility company, and other billionaire corporations rich at our own expense, we can live a much richer life. The solutions require outside-the-box thinking and are not found in the mainstream media. Our team has been saving homes and nest eggs, while transforming lives on Main Street, since 1999, with time-proven 21st Century strategies. Email [email protected] if you would like access to a free video coaching series on debt reduction and budgeting. We also have 21 days of prosperity and abundance video coaching to promote a healthier, wealthier, more beautiful you. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Photo: Natalie Pace with her No. 1 son son. Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Will Boeing Be Booted Out of the Dow Jones Industrial Average? Arkansas Sues Temu for Data Theft. We Must Be the Boss of Our Money. Why? Oil Prices Tumble. Why? Sweepstakes for the Release of The ABCs of Money. 6th Edition. Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  NASA and Boeing welcomed Starliner back to Earth following the uncrewed spacecraft’s successful landing at 10:01 p.m. MDT Sept. 6, 2024, at the White Sands Space Harbor in New Mexico. Credit: NASA Will Boeing Get Booted Out of the Dow Jones Industrial Average? Why does this matter to your retirement plan? The Dow Jones Industrial Average Index consists of just 30 companies. One of those companies is Boeing, a company that has consistently made headlines over the past decade for all the wrong reasons (some of which are outlined below). Boeing’s credit rating is BBB- with a negative outlook. A downgrade would take the company to speculative status (junk bond, not investment grade), which disqualifies the company from the index. Does this matter to your retirement plan? Yes. Here are the topics we’ll cover in this blog. Dogs of the Dow The Challenges Keep Coming at Boeing Can Boeing Fix Things Without a Credit Downgrade and Delisting? Why Does This Matter to Your Retirement Plan? What Can You Do? And here is more information on each point. Dogs of the Dow It’s a little surprising that Boeing hasn’t been booted from the DJIA yet, given all the challenges the company has had, the low credit rating, and the fact that there are just 30 Blue Chips in the DJIA index. However, the index often sticks with former Blue Chips until the bitter end. AIG was removed on Sept. 18, 2008, days after the company received an $85 billion government bailout to avert bankruptcy. Amazon replaced Walgreens Boots Alliance on the DJIA on February 26, 2024, just five months before Walgreens was downgraded to junk by S&P Global on July 19, 2024. As I mentioned in a previous blog, there are many other old-school corporations listed on the Dow Jones Industrial Average that have been underperforming on Wall Street. These include chemical companies Dow Inc. and 3M, and Verizon and The Walt Disney Co. Below is a 5-year performance chart of the DJIA compared to the S&P500 and the NASDAQ Composite Index. As you can see, the DJIA is performing below both indices, and about half as strong as the technology and biotech-rich NASDAQ. The Dow Jones Industrial Average (blue) compared to the S&P500 (red) and the NASDAQ Composite Index (green)  Source: MSN.com. © Microsoft. Used with permission. The Challenges Keep Coming at Boeing The whistleblowers have been warning of endemic safety violations for years. Boeing left two astronauts stranded at the Space Station. They will return to Earth in February of 2025 on a SpaceX aircraft. Boeing workers have been on strike since Sept. 13th. Boeing has admitted guilt to a criminal fraud charge and agreed to a plea deal with the Department of Justice over the two crashes of 737 Max jetliners that killed 346 people. (That deal has yet to be approved by a Houston judge.) A door panel exploded out of a 737-9 Max jetliner during an Alaska Airlines flight over Oregon in January (2024). Not surprisingly, Boeing revenue slumped -14.61% in the 2Q 2024 quarter (from the same quarter the year prior). The company lost $1.4 billion in the 2nd quarter and anticipates another billion-dollar loss in the third quarter (source: Seattle Times). The strike has stopped production in Washington State and is now in its third week. Will all this result in the company’s credit rating dropping out of investment grade, causing the Dow Jones Industrial Average to boot it out of the 30-company index? If you would like an updated Airlines, Chemical, or Defense Stock Report Card, or a list of the DJIA companies, email [email protected]. Can Boeing Fix Things Without a Credit Downgrade and Delisting? After a series of terrible (criminal), greed-guided missteps in the C-Suite, Boeing is again trying a fresh hand at the helm of the company. Kelly Ortberg, Boeing’s new CEO, has an engineering background. Dave Calhoun, the CEO between January of 2020 and August 8, 2024, had an accounting background. Dennis Mullenberg, who was Boeing’s CEO between 2015 and 2019, also had a degree in aerospace engineering and a master’s in aeronatics and astronomics. How did things go so wrong under Mullenberg’s 4-year tenure as the CEO and chairman of Boeing (3 years)? Why did he lie and say that Boeing’s planes were safe after two horrific crashes? Can investors trust that the C-Suite environment has been cleaned up enough to put the company on the right track? On the positive side, most of Boeing’s board of directors were appointed in 2019 and thereafter. Kelley Ortberg promises to root out the problems at Boeing and “restore the trust of our customers and meet the high standards they expect of us,” according to the Seattle Times. On September 20, 2024, the top executive at the space and defense division of Boeing was canned by Ortberg. However, Stephanie Pope, who oversaw aerospace between April 2022 and December 2023, remains the COO of Boeing and the president and CEO of Boeing Commercial Airplanes. Even with the (mostly) new leadership, Boeing’s challenges will not disappear before more losses (hopefully limited to balance sheet and not lives) and bad news (like a credit downgrade) occur. The production halt is going to mean that Boeing’s trend of burning through cash is likely to continue through the end of 2024 (at least). Why Does This Matter to Your Retirement Plan? Why should you care whether Boeing gets downgraded? Many retirement plans and financial advisors offer DJIA-based funds because it is the most recognized index on Wall Street and purports to be the leading Blue-Chip Index. We’ve already seen how the Dogs of the Dow are muting the index’s performance compared to the S&P500 and the NASDAQ Composite Index. The DJIA lost 55% in the Great Recession, and took years to crawl back to even. The S&P500 dropped almost -40% in just four weeks between Feb. 19 and March 23, 2020. When you wait for the headlines that something terrible has happened, it’s too late to protect your wealth. When you keep enough safe and diversified and rebalance your wealth plan at least once a year, you might even earn gains in recessions (as Nilo Bolden did, during the Great Recession).  https://www.youtube.com/watch?v=gMmsuT84S7E What Can You Do? A time-proven 21st Century plan would always have us keep a percentage equal to our age safe and diversify our at-risk (stocks, equities) investments. Now that we are responsible for our own retirement plans, it’s key that we do this properly. We might also consider underweighting the DJIA and leaning into the S&P500 for the large cap allocations in our plan. We could even consider adding a hot slice or two of the NASDAQ Composite Index, or a targeted Magnificent 7 fund. This isn’t complicated. It’s actually as easy-as-a-pie-chart when you implement our time-proven 21st Century strategy. That’s why we call it the life math that we all should have received in high school and college. Bottom Line If Walgreens serves as an example, we might see Boeing get the boot from the DJIA and receive a downgrade from S&P Global. There are ifs in that sentence. Boeing has defied the naysayers and stayed in the DJIA for the past five years, through a lot of challenges that would have bankrupted most companies. It is possible that the debtors and investors will find creative ways to float Boeing until production is up and improved. However, even if the analysts believe that the new Boeing board and CEO can clean things up and turn things around in 2025, Boeing has at least a few more quarters of bad results to get through – something that usually results in selling. (The 5-year low was $95/share, while the current price is still $156/share.) These are all reasons to seek a more diversified portfolio in our nest egg, and to know clearly where our hard-earned money is invested and why. With stocks trading at an all-time high, now is the ideal time to do this. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Arkansas Sues Temu for Data Theft. We Must Be the Boss of Our Money. Why? Oil Prices Tumble. Why? Sweepstakes for the Release of The ABCs of Money. 6th Edition. Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Arkansas Sues Temu for Data Theft. Temu Surpasses Target. Email [email protected] if you would like an updated Retail Stock Report Card. Temu was only founded two years ago. However, the company is everywhere on Instagram and TikTok, offering cheap goods that are mostly manufactured in and shipped out of China. The revenue growth of Temu’s parent company has been explosive, at 86% in the 2nd quarter of 2024. According to Comscore, Temu’s unique visitors in the U.S. were 70.4 million in August, compared to Target’s 67.8 million and Amazon’s 238.3 million. For a company founded just two years ago, this is quite an extraordinary feat. The fact that this is a Chinese company whose CEO is a data mining specialist adds a more troubling undertone to the success. When Chinese companies are experiencing prohibitive tariffs (electric vehicles) or outright bans (TikTok from all government devices) and Beijing-based equities are shunned by Wall Street, how has this Chinese retailer become so big in the U.S.? Will it last? Here are the topics we’ll cover in this blog. Chinese (Not Really Irish or Cayman Islands) Explosive Growth Walmart Wiped Out Main Street Merchants. Will Temu Wipe Out Walmart? Arkansas Attorney General Sues Temu The Atacama Desert in Chile Fossil Fuels, Oil and Fast Fashion “Shop Like a Billionaire” And here is more information on each point. Chinese (Not Really Irish or Cayman Islands) Temu is owned by PDD Holdings. PDD Holdings is run by Chinese executives. The Chairman and co-CEO Lei Chen is a data scientist who specializes in data mining, according to the company’s investor relations page. During the earnings calls, the co-CEOs answer questions in Chinese. The C-Suite is all Chinese and four out of six board members are Chinese (with one from Singapore and the other Dutch). The press releases list Dublin and Shanghai as the company headquarters. Chinese equities have been out of favor with investors since the Holding Foreign Companies Accountable Act became law (Dec. 18, 2020). While no publicly-traded Chinese mega-cap companies are currently at risk of being delisted from the NYSE or the NASDAQ stock exchanges, many top flyers are trading at all-time lows, including Alibaba and Weibo. PDD Holdings has had wild swings in price, surging to $200/share in February of 2021, and plunging to $35/share in March of 2022. PDD traded at $99.90/share at the close of trading on Sept. 20, 2024. Do Western investors and consumers know that PDD Holdings (Temu) is a Chinese company with a data mining scientist at the helm, or do they really believe that Temu is owned by the Irish? Explosive Growth Temu offers $16 shoes, $10 t-shirts, furniture with prices to challenge Ikea and even semi-automatic toy guns with “realistic shell ejection” (price $11). With prices that low, how is it that Temu’s parent company PDD Holdings enjoyed a 33% profit margin in the 2nd quarter of 2024, while Walmart and Amazon only managed 3% and 9%, respectively? While financial engineering could be at play, a few things are sure. The merchant-sellers are not getting rich and the laborers making the goods are likely to be exploited. Hundreds of Chinese merchants staged a protest at the Temu offices in Guangzhou, China on August 1, 2024, complaining about unjust fines levied by the company or payment that was being withheld on goods that were already sold (source: CNN). In the 2Q 2024 earnings call, PDD Holdings’ co-CEO Lei Chen explained that the higher margins were a “mismatch between the business investment and financial reporting cycle.” All the management team at PDD warned that profitability will decrease in the coming quarters, due to “changing consumer demand, intensifying competition, uncertainties in [the] global environment,” and increased corporate investments. CFO Jun Liu warned repeatedly that profitability doesn’t follow a linear path and that it would fluctuate in the short term and then “track lower” in the long term. Walmart Wiped Out Main Street Merchants. Will Temu Wipe Out Walmart? In the 1980s, Walmart made it impossible for Main Street merchants to compete with the rock-bottom prices of Chinese-made goods. Stores on Main Street were shuttered as Walmart megacenters began showing up across America. Today, Walmart is worth $635 billion. Amazon’s market value is an astonishing $2 trillion. PDD Holdings market capitalization is $136 billion. PDD specializes in agricultural products in China (with Pinduoduo) and competes with Amazon here in the U.S. with Temu. One of the major risks to Temu and PDD Holdings’ ultimate success, which is acknowledged by co-CEOs Lei Chen and Jiazhen Zhao, is the uncertainty of what they call the rapid shifts of the “external environment.” Many problems lie under the umbrella of this phrase, including geopolitical, supply chain and environmental challenges. The international tension between the U.S. and China has been well-publicized. Global supply chain challenges have escalated due to wars in the Middle East and Ukraine. The world is on fire, and consumers increasingly care about a company’s commitment to reduced CO2. Does all of this get thrown out the window in order to buy $10 shoes and clothes? (So far, sadly, the answer to that for many consumers is, "Yes.") Are there other challenges? Arkansas Attorney General Sues Temu According to Tim Griffin, the attorney general of Arkansas, “Temu is not an online marketplace like Amazon or Walmart. It is a data-theft business that sells goods online as a means to an end.” Having a data mining specialist as the CEO doesn’t help Temu’s case. Is it a coincidence that Walmart is an Arkansas company? (You might remember that the U.S. began a war on Huawei less than a month after Tim Cook, Apple’s CEO, joined Trump’s American Workforce Policy Advisory Board in February of 2019.) The Atacama Desert in Chile While PDD holdings acknowledges that environmental protection is one of the challenges the company faces, it offers no plan for going green. Meanwhile, the clothing dump of discarded fast fashion in Chile’s Atacama Desert is visible from space. PDD Holdings hasn’t filed an environmental impact report in at least four years, so it’s difficult to know the exact scale of the massive CO2 footprint Temu and Pinduoduo have. Temu’s cheap goods are at the forefront of fast fashion and overconsumption, with over a million packages shipped around the world daily (according to TechBuzzChina). Fossil Fuels, Oil and Fast Fashion Cheap clothing is mostly made of polyester, which is an oil-based product. From its origins (oil wells), to production (chemicals), to leaching those micro-plastics into our bodies and water supply when worn and washed, and finally taking up to two centuries to decompose, polyester is one of the worst CO2 footprints known. Sadly, this fact is not well-publicized, perhaps because there is a lot of money to be made up and down the supply chain. (India’s wealthiest man is a polyester magnate.) Learn more in my Fast Fashion blog. (Click to access.) “Shop Like a Billionaire” Temu’s Super Bowl Ad featured animation, sparkles and a Shop Like a Billionaire theme song. Everything from furniture to skateboards and clothing cost just 99 cents to $10 bucks in the ad. Campaigns on social media platforms, including TikTok and Instagram, target young consumers with hard-to-resist prices. Despite all of this, the Unique Visitors in the U.S. declined from a high of 90.5 million in July 2023 to 70.4 million in August of 2024. Will concerns about exploited labor, shafted merchants, clothing waste and data privacy, or a backlash against polyester, trend on social media, or will the ads continue to attract more and more unsuspecting consumers? Bottom Line Temu’s business model is troubling, as exhibited by the merchant protests in China. It is owned by a Chinese data mining specialist. PDD’s executives are promising to “adopt the necessary policies to vigorously support high quality merchants and tackle low quality ones.” However, the lack of mention of environmental policies, labor justice, merchant support or data privacy is quite deafening. The tricky maneuver of listing Dublin as the company headquarters, while the CEOs conduct quarterly meetings in Chinese, is something a meme stock investor might miss. However, eventually all these concerns could add up to a meteoric rise and spectacular crash and cautionary tale. I wouldn’t buy the merchandise or stock of this company. If I had in the past, I’d do everything in my power to scrub my information, including credit card and financial data, from their app and website. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest We Must Be the Boss of Our Money. Why? Oil Prices Tumble. Why? Sweepstakes for the Release of The ABCs of Money. 6th Edition. Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  We Must Be the Boss of Our Money. Why is this so important? Because having blind faith that others are protecting our future can be a very expensive lesson. Below are the topics we’ll cover in this blog. A Few Examples of Money Advice Gone Wrong + Better Strategies Financial Advisors Certified Public Accountants Real Estate & Mortgage Broker-Salesmen Stock & Insurance Broker-Salesmen Fintechs Estate Planning Attorneys Debt Reduction Specialists Time-Proven 21st-Century Strategies And here is more information on each point. .jpg) Adrian Peterson, running back with the Minnesota Vikings before a game against the Green Bay Packers at Lambeau Field on October 24, 2010. Photo by Mike Morbeck. Wiki Commons. Used with permission. A Few Examples of Money Advice Gone Wrong + Better Strategies Financial Advisors I recently learned about the heartbreaking story of Adrian Peterson, who is being held personally responsible for $12 million in debt that his financial advisor put him on the hook for. He had been told that he would never be responsible for the business personally. However, that was not what was listed in the agreement with the lenders. According to ESPN, Peterson has been ordered by a judge to turn over assets to the debt collectors. What is the important lesson here? Not only must we be the boss of our money, but we must also read the fine print. The fine print is what is enforced, not the conversation where we might have been misled or misinformed. Additionally, we need to know what we own, receive regular updates and understand whether we’re making or losing money (including those pesky “paper losses” that you might have heard about). Peterson’s debt reportedly started at $5.2 million in 2016, but has more than doubled due to interest and attorney’s fees. Certified Public Accountants In the introduction of The ABCs of Money (be sure to get the 6th edition), I share a very personal story about a friend that I lost to suicide. She had made a number of investments that almost bankrupted her. The money she invested was borrowed against a debt-free home that she had recently inherited. Many of the money pits were recommended by her CPA, who was receiving a notable commission for selling them to her. The third trust deeds that she was assured were safe and would offer her a great income were owned by a private company that ended up declaring bankruptcy. It’s quite difficult to recover funds from private companies without substantial legal costs – potentially even more than her initial investment. What is the lesson here? Anytime someone is offering us an investment opportunity, we need to know what their incentive is. Are they being paid a finder’s fee, a sales commission, a percentage of assets under management, or is this a multilevel marketing scheme? Have we been provided the proper documents to do our due diligence, or are we being asked to act now and have blind faith? Anytime someone is asking us to act quickly or miss the opportunity or is not providing the profit and loss statements that are necessary to do our due diligence, those are all reasons to walk away. You wouldn’t try to hit a ball blindfolded, and you shouldn’t try to invest using only blind faith. Real Estate & Mortgage Broker-Salesmen In the case studies of The ABCs of Money, sixth edition, I relate the story of a young successful businesswoman who purchased a condo in Miami at the top of the market in 2006. She was assured by her boyfriend and the mortgage broker that this would be a buy and flip situation where she would make enough money in a few short months to put a down payment on a home. She lived in a very expensive city on the West Coast, so this sounded like a golden opportunity. After her purchase the housing market started weakening, home prices began plunging. (The all-time high for that period was 2006.) She was on the line for the monthly mortgage payment, the HOA fees, and a home that was now worth less than what she paid for it. Not only did she lose the investment, but she was also on the hook for thousands of dollars monthly, plus legal fees, and potentially even phantom income if she tried to short-sale the property. She was desperate when she called our office. If you’d like to know how we helped her get out of that terrible situation, read the real estate section of The ABCs of Money. There are many tips for real estate that are very relevant for today’s market, whether you are considering buying, selling, downsizing, upsizing or any other real estate transaction. What’s the lesson here? There’s a lot more to consider before buying a house or a condo than just the simple math that you might be paying a smaller mortgage than your rent. That is not the only cost of ownership. If you buy high, then you potentially have the issue of an investment that could lose value. So, you need to evaluate all of these moving parts before making your purchase. Sadly, according to a survey conducted by Clever in 2024, up to 82% of homebuyers have buyer’s remorse, while 43% have struggled to pay their mortgage and 44% have taken on additional debt to maintain their standard of living. Due diligence comes up again as a primary theme. However, the real estate and mortgage broker were both showing their charts of just how high real estate prices had escalated in the Miami area and all of the people that were moving there. (Both were making a great commission on the purchase and the sale.) What potential downsides were missing from the pitch? Quite a few! One was that prices were unsustainably high, and people who lived in the area couldn’t afford to buy anymore. The other was that a lot of the people who were moving into the area were construction workers, who follow the jobs. When construction seized up and the jobs evaporated, the workers went back home. It’s not possible to do proper due diligence until we learn the life math that we all should’ve received in high school. While this requires learning at least the basics on the relevant data, considerations, macro trends, and other important statistics (that few salesman will ever show us), it’s quite empowering to be the boss of your money. Once we learn this, we have a solid financial foundation upon which to build the life of our dreams. Salesmen will always show us charts that help to make the sale. It’s our job to request and receive the full picture. Stock & Insurance Broker-Salesmen Most managed plans do whatever the market does. When stocks are high, everyone is happy. When stocks descend, everyone blames their broker. However, no amount of regret or complaining will make the lost money return. There is a very high turnover in the broker- salesman industry in recessions. In terms of insurance products, they are not FDIC-insured. Some can go down in value with the markets, while others might have fees and terms that we are not aware of and were not properly spelled out in the sales pitch. Again, here is where the fine print is going to be enforced, not whatever we were told. What is the lesson? Fix the roof while the sun is still shining. Don’t wait for stocks and real estate prices to drop before we protect our wealth. It’s easy to feel complacent when stocks and real estate prices are at all-time highs, as they are today. It’s also easy to want to jump in and join the party, hoping that prices will keep escalating ever higher. A better plan is more strategic than that. We want to have an age-appropriate, diversified, regularly rebalanced, nest egg strategy, and a housing and real estate plan that can survive a recession, while keeping more money in the family. The goal is to stop making the landlord (and the insurance salesman) rich. However, it must be down strategically. We will be hosting our 100-year Multigenerational Family Wealth Plan Masterclass soon. Email [email protected] with 100 Years in the subject line to learn more. Fintechs Fintech companies have become so popular that many of us don’t even know the difference between them and the bank. Cash App, Venmo, Paypal, Wealthfront, our brokerages who have a deal with a bank – all of these are not FDIC-insured against their own failure (only if their partner bank fails). This is a giant sinkhole in the FDIC-insured promises that so many are counting on. We will be hosting a Bond & What’s Safe MasterClass on October 26, 2024. You can also learn more in our Fintech blog. Email [email protected] with What’s Safe MasterClass in the subject line to learn more. Prerequisite: the 3-day Financial Freedom Retreat.  Restormel Castle was built in the Middle Ages and was occupied by The 1st Prince of Wales. Photo of Natalie Pace by Marie Commiskey. Estate Planning Attorneys It’s a great idea to stop making the taxman rich. If you’re not maxing out your retirement accounts (including a Roth IRA and a Health Savings Account), then you might be getting eaten alive in expensive capital gains taxes – particularly if you like trading and are subject to short-term capital gains. Estate planning attorneys can be an important part of our wealth preservation strategy, particularly as many are quite keen on tax strategies that most of us are not aware of, including foundations, DAFs (Donor-Advised Funds), legacy planning under the gift tax level, and other sophisticated, legal structures that help high-net worth individuals pay less in taxes (percentage-wise) than their executive assistants. However, here again, it’s important for us to be thinking about the complete picture. For instance, the attorney may have a great plan of how to put our home in a trust for the next generation, but are they also thinking about ways that we might stop making the landlord rich now, particularly if our young adult is a renter (and receiving a little help from the Bank of Mom & Dad). Should we have a vision that looks out 100 years, while also benefiting three generations now? While many estate-planning attorneys are astute on tax strategies, be sure that we are also factoring in having an age-appropriate, diversified portfolio that is rebalanced, as well. Protecting and growing our family wealth requires more than just trusts and taxes.  HOUSEHOLD DEBT AND CREDIT REPORT (Q2 2024) Debt Reduction Specialists We must be super careful when we are looking for debt reduction assistance, especially from people who say they can eliminate debt, and even more so if they charge us a fee upfront. A debt problem is a budgeting problem. So, any debt reduction plan must also include a Thrive Budget®. It is hard to acknowledge that the budget is the problem because many of us are not shopaholics. We might consider ourselves to be very frugal. Meanwhile, we’re drowning and going deeper in the hole, due to the high cost of the big-ticket items, including housing, transportation, healthcare and health insurance, food, gas and more. Each quarter, U.S. Household Debt keeps hitting new highs. https://www.newyorkfed.org/microeconomics/hhdc While it isn’t our fault that things are so expensive, extricating ourselves from the rat race in order to live a richer life today and provide better for tomorrow is only possible if we make brave, resourceful choices with regard to budgeting, investing, and reducing debt. There is $1.6 trillion in college loan debt. On average, Millennials and Gen Z are being forced to wait 7 years longer than Gen X and Boomers did to buy their first home. For many, owning a home may seem like a pipe dream. Whether you are a parent, a college student, high school student or someone who is thinking about going back to school for an advanced degree, student loans are an important factor in the College Experience. In The ABCs of Money for College, we outline how to get a better degree for up to half the cost and include important information on skills and trades that will be in high demand in the 21st Century that do not require a diploma.  Time-Proven 21st-Century Strategies Our time-proven 21st-Century budgeting and investing strategies are enthusiastically recommended by Nobel Prize winning economist Gary Becker, MacArthur Genius Award winning economist Kevin Murphy (and other VIPs), and are embraced and applauded by many Main Street investors and denizens. We’ve been saving homes and nest eggs since 1999, while adding a splash of green to Wall Street. You can read about them in The ABCS of Money 6th edition. You can learn an implement them at our 3-day Financial Freedom Retreat (online). You can consider getting an unbiased 2nd opinion of your current wealth plan through my private coaching. Email [email protected] or call 310-430-2397 to learn more. Bottom Line Stocks are at all-time highs. Real estate prices are at all-time highs. Rather than be complacent or jump in just to join the party, it’s important to protect and diversify our wealth now, while we still have plenty of options. Remember: most people don’t buy low because they can’t. When recessions hit and stock and real estate prices drop, most people are struggling. Few have the resources and vision to take advantage of lower prices and opportunities. So, fix the roof while the sun is still shining. Don’t have blind faith that someone else is doing this for you. Be the boss of your money and life. Know what you own and why. The sooner we do this, the faster our secure financial home gets built and our life transforms. Call 310-430-2397 or email [email protected] to learn more now. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Oil Prices Tumble. Why? Sweepstakes for the Release of The ABCs of Money. 6th Edition. Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Oil Prices Tumble to $69/Barrel. Why? What does this mean for the economy, our personal wallet, our investments and the bigger picture? On September 10, 2024, oil prices dropped as low as $65.59 per barrel (US WTI). Prices recovered somewhat to $66 by the end of the day. This is far below the $84 price on July 3, 2024, or the 5-year high of almost $121/barrel. (Prices clawed back to $69 on Thursday, Sept. 12, 2024.)  Below are the topics we’ll cover in this blog. Email [email protected] if you would like an updated Oil Stock Report Card. Why Did Oil Prices Tumble to $66/Barrel? How Will Lower Oil and Gasoline Prices Affect the U.S. and Global Economy? What Do Lower Oil and Gasoline Prices Mean for Our Personal Budgets? Should We Worry About (and Protect) Our Investments? What About the Bigger Picture (Clean Air, Water, Oceans, Animals and Humanity)? Sept. 22, 2024, is Global Car-Free Day And here is more information on each point. Why Did Oil Prices Tumble to $67/Barrel? On September 10, 2024, OPEC revised their 2024 demand growth forecast down to about 2 million barrels per day. Next year, oil demand is expected to grow by 1.7 million barrels per day. This is still well above the historical average before the pandemic. However, lower than expected demand was the driving force causing prices to drop so precipitously yesterday after the announcement. Some of the reasons why the demand has softened slightly include China’s aggressive move into electric vehicles and slow global GDP growth. According to the International Energy Agency, China had 8.1 million new electric car registrations in 2023, which is 30% higher than 2022. Over one million EVs were sold in August in China (source: Rho Motion). The move to electric vehicles over the internal combustion engine (ICE) means less gasoline than forecasted will be sold in China.  The Tesla Model Y was the bestselling vehicle in the world in 2023, with over 1.2 million deliveries. How Will Lower Oil and Gasoline Prices Affect the U.S. and Global Economy? High oil prices are highly correlated with recessions. In the chart above, the grey lines are recessions, and they match up with the high oil prices. When consumers have to spend more on their commute, they have less that they can spend on other bills, and certainly on discretionary items. Since the US economy is driven by the consumer, with 68% of GDP made up of consumer spending, lower oil prices can be positive for the U.S. economy, if the industry weakness isn’t too severe. The United States produces more crude oil than any other country. However, US consumers also use more gasoline (and other types of energy) than any other country. When the U.S. economy is strong, that’s positive for the global economy because the U.S. imports a lot of goods from other nations. Conversely, when the US sneezes, the world catches a cold. So far, so good. What Do Lower Oil and Gasoline Prices Mean for Our Personal Budgets? Thankfully, retail gasoline prices dropped to $3.24 a gallon. That is down from about $5/gallon in June 2022.  However, most of us are still struggling with unaffordable housing and unsustainable debt. Government leaders and central banks still have a lot of work to do to fix the imbalances. However, waiting for politicians to fix things can be very frustrating. There are ways that we can save thousands of dollars annually in our budget with smarter big-ticket choices. Email [email protected] and we will send you a few options on how you can learn budget-saving, life-transformational strategies. You can read about them in the 6th edition of The ABCs of Money. You can learn and implement them at our Financial Freedom Retreats.
Should We Worry About (and Protect) Our Investments? If oil prices remain under $70 a barrel, the next quarterly earnings reports for these oil companies will likely miss their guidance. They could also show a net loss on the quarter. Many of the oil companies are trading at or near their 52-week lows (with the weaker demand). However, prices are still relatively high on the five-year continuum, and could drop further when 3rd quarter 2024 earnings are released in October of this year. Supply and demand are key for oil company profitability and shareholder returns. Right now, both demand and production capacity are high. OPEC countries have recently reduced production in an attempt to keep prices at $80/barrel or higher. However, there are crises that can drastically change the formula. The all-time high oil prices were during the wars in Afghanistan and Iraq. (The wars in the Middle East and Russia/Ukraine can push prices higher, particularly if they expand beyond these regions.) While this might be positive for the oil industry, it can also be harmful by pushing the world economy into a deep recession. And, even when one industry is strong, the macro economy can change the trajectory on a dime. For instance, when the pandemic hit and the world shut down, oil prices plunged to negative territory, and the oil companies lost 60% or more of their share price in less than a month. As Andrew Lo, an MIT Professor, is fond of saying, “Physics has three laws that explain 99% of the phenomena, and economics has 99 laws that explain 3% of the phenomena.” Almost daily, we see stocks soar or plunge. The general trend since the Great Recession has been up. So, it’s easy to think that if we just “buy and hold,” everything will come up roses. However, 21st Century recessions dive far and fast, and then take years to recover. Many of us have oil or petroleum-based chemical companies in our portfolios, particularly if we have an insurance product, value fund or Dow Jones Industrial Average index fund. So now, with stocks trading at all-time highs, it’s a great idea to rebalance and protect our wealth. It’s not a matter of jumping all in or all out of the markets or oil stocks (unless you want to green your portfolio). It’s a matter of having an age-appropriate plan that is diversified, while earning 5% yield on the safe side (without paper losses). Join us at our Financial Freedom Retreat October 18-20, 2024, to learn time-proven, 21st Century strategies that earned gains in the Dot Com and the Great Recession, and outperformed the bull markets in between. What About the Bigger Picture (Clean Air, Water, Oceans, Animals and Humanity)? People living in the Middle East, Canadians, Americans, Australians, and Russians have the highest CO2 footprint per capita. Italy, Greece, Spain, and the U.K. have CO2 footprints that are about a third of those countries or less. Developing countries tend to have much smaller CO2 footprints, with Africa, having a rounding error of the rest of the world. A lot of that has to do with our commutes and our residential and building energy usage. There are many ways that we can lower our CO2 footprint, while still living a purposeful and rich life. Smarter choices can save us thousands in our budget, with only small fixes and changes in lifestyle. For instance, we can fix the leaks at home and make sure that we are not heating and cooling the outside air (even if we are renters). A simple timer on our water heater, or drying clothes on a line can result in a dramatic reduction on our MW usage (and utility bill). Read The Power of 8 Billion: It’s Up to Us for tips and information.  Sept. 22, 2024, is the Global Car-Free Day Driving everywhere in a single occupancy vehicle is an expensive, CO2-intensive endeavor. Switching to a more sustainable commute could save us $8000 or more annually each year. Why not try at least one day of using a different type of transportation on Sunday, September 22, 2024, which is the Global Car-Free Day. If you post any pictures or video online, be sure to use #EarthGratitude so that we can easily find and like it. Bottom Line Lower prices are good for consumers. However, oil companies want to keep prices above $80/barrel for their own profitability. So, I wouldn’t count on oil and gasoline prices remaining where they are for very long. Rebalancing our investments and protecting our wealth means that we don’t have to worry about the all-to-common wild peaks and valleys in equity and oil prices. Fixing our commute to be less reliant on expensive fuel like gasoline could help us balance our personal budgets and have more money for things we like a lot more than oil rigs – like bucket list vacations or saving up to buy a house. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The Power of 8 Billion: It's Up to Us and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Sweepstakes for the Release of The ABCs of Money. 6th Edition. Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  The ABCs of Money 6th Edition Sweepstakes. Win a Seat at the Retreat and Other Prizes Win a Seat at the Retreat Everyone is a winner in our 2024 September The ABCs of Money 6th edition Sweepstakes. (See the full list of prizes below.) The Grand prize is a complimentary seat at an Online Financial Freedom Retreat, (retail value: $895). Our next retreat is Oct. 18-20, 2024 (online). Simply email [email protected] with the subject line The ABCs of Money 6th edition Sweepstakes! You will be automatically entered to win. There is no purchase necessary to be entered in our September 2024 The ABCs of Money 6th edition Sweepstakes. If you’d like to up your odds, then write a review of the 6th edition of Natalie Pace’s Amazon Exclusive book, The ABCs of Money. Send us a link to your review on Amazon, and we’ll enter you 10 more times in the Sweepstakes. The Kindle version is available for just $9.99. The print edition will be available soon for $17.99. Your review of the 6th edition of The ABCs of Money is important to us, and also important to anyone who is interested in living a rich life, protecting and growing their wealth, saving thousands annually in their budget, buying or selling a home, or reducing debt. The more you share and review, the greater the chance that this important information gets into the hands of those who need it most. So, I encourage you to share the book and your review on your social media. Please include #NataliePace and tag us, so that we can like and share your review! https://instagram.com/nataliewynnepace https://www.facebook.com/TheABCsofMoney https://www.linkedin.com/in/nataliepace/ https://x.com/NataliePace Act now. Entries must be received by Sept. 15, 2024. Winners will be notified on or before Sept. 30, 2024. List of Prizes Grand Prize: 12-month, all-access pass to all of our online training (value $5680) Retreat Seat (value up to $895) ½ off Retreat Seat (value $447.50) 2nd opinion on your current budgeting and investing plan (value up to $1495) Three 50-minute private prosperity coaching sessions (value $1200). 50-minute private prosperity coaching session (value $400). Autographed print edition of The ABCs of Money 6th edition (priceless) Everyone is a Winner Every person who enters the sweepstakes can choose to receive a complimentary gift from us. Choose from the videocoaching programs below: 1. A complimentary 21-day Prosperity and Abundance videocoaching program: 21 days to a healthier, wealthier, more beautiful you, and/or 2. A 21-Day budgeting, debt, or sustainability videoconference series, where you can learn how to save thousands of dollars annually with smarter big-ticket choices. Simply indicate which videocoaching series you prefer when you register for the sweepstakes. Again, simply email [email protected] with the subject line The ABCs of Money 6th edition Sweepstakes! You will be automatically entered to win. Thank You! Your presence in our community, with a dedication to financial empowerment and sustainability, means the world to us. We work hard to keep you informed and inspired, and we thank you for helping us to spread the word of this important new edition of The ABCs of Money. Thank you so much for your review! You can read the editorial reviews on the Amazon book page. I’ve highlighted just a few below. The Retreat Sweepstakes entry period expires Sept. 15, 2024. Anyone who has emailed us on or before Sept. 15, 2024, with The ABCs of Money 6th edition Sweepstakes in the subject line will be entered in the drawing. Winners will be chosen randomly and notified on or before Sept. 30, 2024. There is no cash value for the prizes. Praise for The ABCs of Money and Natalie Pace’s work. "The ABCs of Money will teach you how to stop getting buried in debt and start scoring gains for the home team. The more you score, the more you'll win financial freedom and enjoy your life. College students need the information before they get their first credit card. Young adults need it before they buy their first home. Empty nesters can use the information to downsize to a sustainable lifestyle, before they get into trouble." Joe Moglia, former Chairman & CEO, TD AMERITRADE "Thank you, Natalie, for saving my retirement!" Nilo Bolden, executive director at a law firm in Century City, CA “Many people, including educated men and women, often get into trouble when they neglect to follow these simple and fundamental rules.” Professor Gary S. Becker Gary Becker won the 1992 Nobel Prize in economics. “As a young professional, between the knowledge gained through retreats and the experiences from our immersive trip [to Cornwall England], I feel much more aligned with my visions and values than most of my peers.” M “We asked Natalie Pace for a second opinion on our investment portfolio. She researched and reviewed each stock and fund. She then explained to us in plain English how we were positioned in the market and how high our risk exposure was. Her knowledge was so profound that we decided to take her retreat in Arizona. My husband was still quite skeptical, but 20 minutes into the retreat he turned to me and said, ‘Thank you.’ Stocks and investing are no longer rocket science. We are finally able to take control of our money. We give thanks just about every day that we met Natalie. I feel like I live on a different planet. I'm so grateful. Thank you for changing our lives, our peace of mind, our future and our vision of what is possible. We made a tectonic shift with you.” AC & AM "The ABCs of Money is a must-read to help people understand the complicated economics of modern day (and how to protect and grow their wealth), or to go from surviving to thriving. It helped me and numerous members of my non-profit, The New Hollywood, to become empowered, educated bad asses with their financial literacy." Brianna Brown Keen Film and Television Actress Founder and CEO of The New Hollywood Learn the ABCs of Money that we all should have received in high school and college to score As in: life math, investing, budgeting, housing, debt reduction and living a richer life. See the collage of Natalie Pace's own life journey to financial freedom in some of the pictures below (and in a reel on Instagram.com/NatalieWynnePace.) Offer for the September 2024 Sweepstakes ends Sept. 15, 2024. Act now!
Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register now to ensure that you get the exact room you want. (There may not be an opportunity to register after Sept. 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The Power of 8 Billion: It's Up to Us and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 5th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Should You Go Conservative or Aggressive? 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Should You Go Aggressive or Conservative with Your Wealth Plan? Is the right answer to do both in an age-appropriate way? You may have asked for one or the other, but how do you know if you’ve really received what you’ve asked for? Is it possible that an aggressive plan is missing out on hot industries, such as artificial intelligence? Is it likely that your “conservative” plan, which is supposed to protect your principal, has lost money? Watch my videoconference, or listen to my podcast on this topic. (Click on the blue-highlighted words to access on YouTube.com/NataliePace and NataliePace.Substack.com.) Below are the topics we’ll tackle in this blog. Is your conservative plan safe, or is it losing money? The aggressive investor: do you let emotions get the better of you? What is an age-appropriate plan? Can you have performance and protection? How do you know if your current plan is age-appropriate and properly diversified? Some valuable assets that you might not be thinking of. Family money that is making landlords rich. Have a 100-year vision, like rich people do. Overweighting 20% safe in our sample pie charts. Free web apps And here is more information on each topic. Is your conservative plan safe, or is it losing money? An all-bond portfolio isn’t as safe as you might think. Neither are money market funds. Why? There is still heightened credit and duration risk in the bond market. In a normal world, interest rate cuts, which are expected to start in September, could bring most of the paper losses back to normal. However, we’re not in a normal world. We’re in a slow growth, overleveraged, Debt World. If you are a fixed-income lover, it’s time to understand how to protect principal, while earning yield. We spend one full day on this topic at our Financial Freedom Retreats. We’ll host a Bond & What’s Safe Master Class, the Saturday after our Oct. 18-20, 2024 Financial Freedom Retreat. Learn more in my blog, “5% Return Without Those Pesky Paper Losses.” $106 billion moved into money market funds in August (as of the 24th), according to Bloomberg. With the expectation of an interest rate cut, investors wanted to “lock in” the higher rate. However, money market funds move with the market. You don’t lock in anything with them. Additionally, money market funds are not FDIC-insured and can go down in value. These funds had to be rescued in the Great Recession and the pandemic. They are not as safe as investors might believe. Given the afore-mentioned credit and duration risk, it’s a good idea to keep the terms short (under 5 years) and the creditworthiness high. Staggered maturity dates that allow us ongoing access to our money can be helpful as well. There may be opportunities in the next five years to take advantage of. Paper losses, long maturity dates and illiquidity will prevent us from being able to take advantage of them. It’s important to read the fine print of any investment, especially if we’re expecting it to protect our wealth. Join us at the retreat & master class to learn more. The aggressive investor: do you let emotions get the better of you? When stocks are high and we’ve made a lot of money it’s easy to want to be aggressive and keep the party going. However, we’ve been in the longest secular bull market in history. Never confuse a bull market with a time-proven plan. Recessions are a normal part of the business cycle. The recessions in the 21st century drop far, fast. Between February 19 and March 23, 2020 stocks plunged 38% in the S&P 500. (We don’t normally print up over $4 trillion to avert a recession.) The best performers in 2023 (the Magnificent 7) were some of the worst in 2022.  So, an important question for “aggressive” investors to ask themselves is, “Am I willing to lose half of my wealth?” (Most Main Street investors lost almost 40% before we even knew we were in a global pandemic in 2020.) As we get closer to retirement, we can’t afford to ride the Wall Street rollercoaster. We don’t have the time horizon to make it up. And it could put us in a perilous position with regard to our home and our ability to pay our bills. A better strategy is always going to be to have an age-appropriate, diversified plan that is rebalanced regularly (capturing gains high). What is an age-appropriate plan? It’s important to always keep a percentage equal to our age safe. Safe means that it is invested in fixed income assets that preserve our principal while providing us with a steady yield. (This is tricky, but doable, once we know how to avoid credit, duration and opportunity risk.) When we are younger, we have time to make up any volatility in stocks. However, as we get older, it’s very important for us to keep our wealth intact and not be subject to the wild fluctuations in price that are characteristic of 21st Century stocks. How can you have performance and protection? When we keep a percentage equal to our age safe, in assets that provide 4-5% yield while protecting our principal, that is a good defensive plan. Before the Dot Com and the Great Recessions, because assets were very expensive and growth was expected to be anemic, we were overweighting safe in our sample pie charts. Today we are again overweighting 20% additional safe. What that does is really protect us from a recession, should it occur. With 20% overweighted safe, a 50-year-old would only have 30% at risk of losses. It is important to remember that economists are terrible at predicting recessions. As you can see in the charts below, by the time the headline screams that we are in a recession, investors have already lost 35% or more of their wealth.   Many people who were using our pie chart samples as their guide in the Great Recession earned gains instead of losing more than half of their wealth.  With regard to performance, most people have a boatload of large cap growth or value. Those are portfolio stabilizers. However, if we want to increase our performance, it’s important to add in hot industries and small caps. Small caps typically outperform large caps. If we wanted additional exposure to the Fantastic 5, we could do a hot slice of breakthrough technology. Other industries we might consider today would be cybersecurity, artificial intelligence, gold, silver, crypto, copper, or any other industry that you really believe is going to outperform. If we’ve asked for a conservative plan, we might not have any exposure to growth stocks and the fantastic gains of 2023 and 2024. Without the Magnificent 7, the S&P 500 earned just 9.9% gains in 2023.  How do you know if your current plan is age-appropriate and properly diversified? In my private coaching practice, many people will come to me with a plan that has 18-pages of holdings and say, “Look! I’m diversified.” When I put each of the holdings into a category based on size and style, what we see is that they have a boatload of large caps. Most plans don’t have enough safe (even if they are “conservative”) and are missing the diversification of small, mids and hot, and oftentimes, even growth. If you ask your broker-salesman whether or not you’re safe and diversified, you might be assured that you are and that all of this is done in accordance with Modern Portfolio Theory. However, what is printed on your brokerage statements is what counts, and that might reveal a different story. Yes, it does require us understanding how to read those. However, that’s easier than you might realize. Our pie chart system makes it easy as a pie chart. If you have never learned the life math that we all should’ve received in high school and college, this will be a game-changer for you in life. You can read about it and my bestselling books, learn and implement it at our online financial freedom retreats, or get an unbiased 2nd opinion and a new wealth blueprint from me personally in my private coaching. Email [email protected] or call 310-430-2397 to learn more now. Some valuable assets that you might not be thinking of. That 2 to 4% mortgage loan. That home you own free and clear. For most of us, it’s a great idea to pay off our home before we retire. However, if we live in a big home that is larger than we need in retirement, and particularly if we have an equity-rich property with a mortgage rate that is under 4%, those are valuable family assets. In today’s world, it really pays to consider at least three generations of the family, and have a wealth plan that works for the grandparents, parents and kids. I discuss this in the 6th edition of The ABCs of Money, which will be published in just a few days. We also talk about this in our Financial Freedom Retreat and Bond Master Class. Family money that is making landlords rich. When each family member is living in a small apartment, particularly with today’s very expensive shelter inflation, we’re making landlords rich. This can be an opportunity for everyone to benefit if we start looking at wealth as that 3-generation plan. The family that comes together to reduce housing costs empowers individuals to invest in a much brighter tomorrow, whether it be by having a better career that will serve them for their entire lives, saving up for a down payment on their own home, contributing to their retirement accounts, getting an advanced degree, or some other wealth building strategy. Have a 100-year vision, like rich people do. When I meet with families who have kept wealth over centuries, one theme is prevalent: their wealth plan covers 100 years. When I’m asking us to think about our parents and our kids and have a plan that works across three generations, it’s simply modeled off what very wealthy people do. Overweighting 20% safe in our sample pie charts As I mentioned above, we are overweighting 20% additional safe in our sample pie charts. If you look at the chart below, you can see that equity prices are higher today than they were in the Great Depression. The only time that prices were higher was in the Dot Com Recession.  In the Dot Com Recession, the NASDAQ Composite Index plunged 78% from the highs of March 2000 to the low of October 2002. It took 15 years to recover. There are some years where protecting our wealth is the most important thing we can do. At minimum, now would be the time to know exactly what we own and why, to be sure that we are age-appropriate and diversified. Free web apps We have some free web apps that can help you to personalize your own sample pie chart. Once you know what an age appropriate, diversified and personalized plan looks like, then it will help you see how close or far you are from that goal in your wealth plan. Email [email protected] with Free Web App Links in the subject line. You can also access them on the homepage at https://www.nataliepace.com/#/ with the Free Web Apps badge. Bottom Line Should you be aggressive or conservative right now? Why not both? Most of us think we’re one or the other, when we might not be. Wisdom and time-proven systems are the cure. Whether you get this information from reading about it in my bestselling book The ABCs of Money (get the 6th edition in a few days), or learn and implement it at the October 18-20, 2024 Financial Freedom Retreat, or receive an unbiased 2nd opinion from me privately in my coaching program, now is the time to fix the roof, while the sun is still shining. It’s human nature to wait until things get broken to fix them. However, securing our financial house before the economic storms arrive mean that we are in the best position to weather those very storms. Email [email protected] or call 310-430-2397 to learn more and register now.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details. \  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register by August 15, 2024 to ensure that you get the exact room you want. (There may not be an opportunity to register after August 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The Power of 8 Billion: It's Up to Us and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 5th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest 5% Yield without those Pesky Paper Losses. The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. 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Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Natalie Pace in Powerscourt, Ireland. Photo by: Marie Commiskey. Earning 5% Interest Without Those Pesky “Paper” Losses. Are you earning nothing in your savings or checking account? Did you realize you could earn $40,000-$50,000 pretty safely on $1 million each year, or $10,000-$12,500 on $250,000? These steady gains can make the difference in our budget, and can contribute to a better FICO score and tomorrow. It’s tricky, but doable. Why is it tricky? If we don’t know what the risks are, including: · “Paper” losses on bonds, · Liquidity fees in money market funds, · Surrender and hidden fees in annuities (that are not FDIC-insured), · Early withdrawal penalties on Certificates of Deposit, · Gap downs and emergency dividend cuts, and, · FDIC loopholes on brokerage accounts, we could end up losing money. Since the “safe” side of our wealth plan is supposed to protect our principal, reaching for yield in a tricky landscape can be perilous to our fiscal health. So, what is a good plan? Here are the things will cover in this blog. Why Would Anyone Purchase a Long-Term Bond? Bond Funds Mortgage-Backed Securities Junk Bonds Managed Plans Duration Risk Liquidity risk Credit Risk Paper Losses More information on each point is listed below. You can also get vital details in my: · Free videoconference on YouTube.com/NataliePace or podcast on NataliePace.Substack.com. · Bonds & What’s Safe Master Class on Oct. 26, 2024. (Prerequisite: Financial Freedom Retreat.) · If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information. Why Would Anyone Purchase a Long-Term Bond? Asked someone who had long-term bonds in her managed plan (and didn’t realize it). After seeing the negative yield curve, where long-term bonds are paying a lower interest rate than short-term, one of my coaching clients asked why anyone would ever buy a 30- or 40-year bond, when they are getting paid more for a 1-year bond. Why take on the risk that you don’t get your money back for almost half of our entire lives?  U.S. Treasury par yield rates. Source: Treasury.gov. That same client held long-term bonds in her own managed plan – mostly in the bond funds that she owned (almost all of which had lost value). Yes, we are the people who buy those long-term bonds, and sometimes even junk bonds, often without realizing it. Whether it is in our managed portfolio, our retirement plan, or in our bond funds, most of us are exposed to duration, liquidity, and credit risk, and paper losses, while also getting a lower yield than the shorter term (and safer) bonds. The first rule of safe investing in a Debt World is to know what we own. We also want to keep the terms short and the credit worthiness high. Holding a bond to term to make up losses doesn’t always make sense, particularly if the term is decades away. (Avoiding those losses in the first place with proper due diligence, instead of blind faith that someone else is doing this for us, is an important determent strategy.) With $35 trillion in public debt and over $99 trillion in total debt and loans in the U.S., it would be smart to adhere to Will Rogers adage: “I’m more concerned with the return of my money than the return on my money.  Bond Funds Many bond funds hold mortgage-backed securities, junk bonds and long-term bonds, even those that claim to be “investment grade.” This helps to explain why so many bond funds have lost value over the past few years. You might be told that these are “unrealized” or “paper” losses. However, as you can see in the charts below, long-term government bonds lost 26% in 2022 and only clawed back about 3% in 2023. Even though interest rates are a tailwind for the bond market, credit, duration and liquidity risks remain elevated.   Mortgage-Backed Securities Some mortgage-backed securities are collateralized by office properties – yes, those half empty office buildings that we know have been a problem for community banks, like New York State Bank and the failed Silicon Valley, Signature and First Republic Banks. Many investment grade bond funds have mortgage-backed securities in them. Oftentimes we’re getting paid 4% or less for taking on the risk of losing some principal. According to the April 2024 Financial Stability Report, the market for commercial mortgage-backed securities (CMBS) collateralized by office properties tightened in term of financing terms and weakened in liquidity, as “collateral quality has weakened and demand for funding has increased.” Many companies are downsizing their office footprint, as a hybrid work week and work-from-home remain popular with the labor force. The CRE industry is one of the areas of greatest concern for Wall Street, banks, brokerages, insurance companies, pension providers and any other entity that loans long-term. https://www.federalreserve.gov/publications/April-2024-financial-stability-report-leverage-in-the-financial-sector.htm Junk Bonds Even investment grade bond funds can have up to 20% of bonds that are below investment grade in them. Since over half of the S&P500 is at or near speculative status, junk bonds are a rampant problem. When a company is downgraded from investment grade to speculative (junk), the value of the existing bonds sinks and liquidity tightens (we’ll have to take a haircut on price to sell the bond). So, the trick is to avoid heavily indebted, slow growth companies and governments. Sadly, in 2024, that included knowing the credit rating of a lot of banks, insurance companies, brokerages, fund companies, fintechs, and other companies that are entrusted with our financial future.  Managed Plans Managed plans are highly likely to have long-term bonds in them, even if we’ve asked for a conservative portfolio. Since bonds are thought of as the “safe” side, we might end up with a lot of bonds that lost even more than stocks did in 2022. We have to know how to read our brokerage statements, rather than just rely upon the assurances of our broker-salesman. I’ve seen a lot of people who were told that they are earning 5-7% yields on their bonds, without being advised that many of our holdings have lost 10 to 20% in principal, taking the overall earnings down to 2% or less, and sometimes even negative. The truth is printed on the brokerage statements. So we must read them, and understand what the information is revealing about our true return (or loss) on investment. Duration Risk Broker-salesman will try to minimize our concerns about duration risk by telling us that we get our money back. However, the longer the period of time that a company or government has to pay us back, the more risk we’re taking on, especially if there is a lot of debt, combined with slow revenue growth and a decline in profitability. I’ve already mentioned that over half of the S&P500 is at or near junk bond status. I reviewed a conservative portfolio for a client who had a junk bond rated BB (speculative) with a duration of 40 years. This particular client will not be alive in 40 years. The company had almost declared bankruptcy in 2022. Revenue was down -35% year over year. The bond was showing paper losses and unloading it to someone else could mean discounting the asset even further. It’s important to avoid this scenario. However, if we find ourselves immersed in it, then it’s equally important to develop an exit strategy and a game plan that doesn’t put us in harm’s way again! Liquidity risk I’m going to stay with the example above because when we own a 40-year junk bond in a company that is on the ropes, who is going to want to buy it from us? When we own a bond that nobody wants to buy off of us, the only way we get rid of it is by putting it up for sale and taking a loss on it. Not a paper loss. A real one. There are all kinds of reasons why we might want access to our own money over a 40-year period, from a better investment opportunity to a dire need to pay certain bills. What is the risk that the company will declare bankruptcy in the not-so-distant future before our term ends? What are the odds that we’ll get paid back less than what we invested? It’s better to ask these questions and receive sober answers before we own the bond. A few years ago, Warren Buffett said that bonds should come with warning labels. In the wake of the Great Recession, MF Global placed a big bet on Greek bonds that they believed would be bailed out by the European Union. The country was bailed out, but the package included forcing existing bondholders to take a huge haircut on their investment. That was one of the reasons why a company with over $42 billion in assets, run by a former Goldman Sachs CEO and Governor of New Jersey, declared bankruptcy in 2011. Credit Risk It’s been a year since Fitch downgraded the USA from AAA to AA+ (on August 1, 2023). S&P Global did it on August 5, 2011. Below are the countries that still have a AAA rating.  Credit risk is a real concern in our Debt World. We all have to be mindful of the fine print, understand the credit ratings, limit the credit, duration and the liquidity risk, and never reach for yield. Some banks do automatic rollovers from a decent yielding CD into one that yields almost nothing. So, things are very tricky today. Paper Losses Paper losses can create a lot of harm to our wealth plan in the near and mid-term, even if we do get the money back eventually (which is not guaranteed). There is a concern that we will have to wait decades to get our money back, while enduring a stressful, challenging interim period. Paper losses reduce our FICO score, limit our access to our own money, and can have other meaningful, significant, and negative impacts. The bank failures of 2023 had a lot to do with paper losses on bond portfolios, which then spread into a contagion of a run on the bank. The Federal Reserve created a Bank Term Funding Program to basically make it so that banks did not have to declare their paper losses. That program no longer makes loans as of March 11, 2024. The terms were for one year so it looks like we may not see or feel the full ramification from the wind down of this program until March 2025 – just a few months after the U.S. will encounter another Debt Ceiling debacle in Congress. Bottom Line We can earn almost 5% on the safe side, but it is tricky. It’s a good idea to keep the terms short, and the credit worthiness high of our fixed income holdings. We need to read the fine print and understand the hidden fees, loopholes, risk, and federal insurance levels. It’s a good idea to have rolling maturity dates, which will give us ongoing access to our money. It’s important to not just have blind faith that our wealth is protected, even if we’ve asked for a conservative portfolio. We must be the boss of our money. Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat and our Bond/What's Safe Master Class Oct. 26, 2024. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register by August 15, 2024 to ensure that you get the exact room you want. (There may not be an opportunity to register after August 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The Power of 8 Billion: It's Up to Us and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 5th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest The Dow Drops 1400 Points. Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  The Dow Drops 1400 Points. After the Feds Signal a September Rate Cut and Unemployment Rises. Watch my free videoconference at YouTube.com/NataliePace. or listen to my podcast at NataliePace.Substack.com. On July 31, 2024, the Dow Jones Industrial Average started out strong, rising 384 points from the open until 2:45 pm ET. However, as the news spread (during the Jerome Powell press conference) that a September interest rate cut was on the table, the sellers dominated the rest of the day, trimming the gains back to 106. On August 1, 2024, stocks retreated further with the DJIA dropping almost 500 points. Today, after a job report showed unemployment had ticked up to 4.3%, stocks dropped further – showing a decline of another 907 points in the DJIA in the first two hours of trading on August 2, 2024. Isn’t a rate cut what everyone has been waiting for? Why the sell-off? What does this mean for investors for the rest of 2024, and what is our best move for both stocks and bonds as we enter a cycle of potential rate cuts? Below are the points we’ll discuss in this blog. 25 or 50 Basis Points? Data Dependent Apple & Amazon Earnings Why are the Feds Considering a Cut & What Does it Mean for Stocks & Bonds? Best Strategy for Stocks Best Strategy for Bonds And here is more color on each point. 25 or 50 Basis Points? Jerome Powell usually sticks pretty close to his talking points and script. However, he was a little bit lively, for him, at the most recent press conference. Powell was fairly emphatic that it would be a 25 basis point cut, if a rate cut takes place, which he repeatedly noted wasn’t a guarantee. He said that there weren’t any discussions of 50 basis points at this juncture. Despite that assertion, 80% of the futures pointed to a 50 basis point cut on August 2, 2024 (source: CME FedWatch). Data Dependent Last year, we had had several months of data showing that inflation was coming down to the 2% target range. And then in the first quarter of 2024, inflation ticked up again, and was once more of concern. In the second quarter of 2024, inflation looked like it was moving down again, from a peak of 7% to 2.5% (source: Federal Reserve). If inflation looks to be stabilizing closer to the target rate of 2%, then the Feds will have greater “confidence” (a key word) that a rate cut won’t raise the specter of inflation again. One of the reasons that a rate cut could be on the table is to make sure that the employment situation continues to normalize, rather than have a troublesome jump in unemployment. Maximum employment is the 2nd leg of the Federal Reserve Board’s dual mandate. Rate cuts are needed to make sure that unemployment doesn’t get too high and a recession doesn’t become too problematic. A tight monetary policy is needed to make sure that prices remain stable. So it is a very delicate dance to get the formula right. These facts were stressed repeatedly by Jerome Powell. As Powell admitted in the July 31, 2024 press conference, “certainty” isn’t a word that is used in economics. Apple & Amazon Earnings Apple and Amazon earnings were announced today, August 1, 2024, after the market closed. In the June 2024 quarter, Apple’s revenue was up 5% year over year, while net income improved by almost 8%. The new AI smart phone may be partially responsible, as is customer loyalty and satisfaction (per CFO Luca Maestri). All geographic regions had increased sales, with the exception of Greater China, which fell by -6.5%. (I explained why China Apple sales are expected to drop in January of this year, in my “Is Huawei the Apple of China’s Eye?” blog.) Asia Pacific had the strongest revenue growth at 13.5%. The Mac, iPad and Services segments were strongest, with revenue growth of 2.5%, 23.7% and 13.7%, respectively. Amazon’s revenue was up 10%, and net income doubled, from $6.7 billion last year to $13.5 billion in the 2nd quarter of 2024. Labor market conditions wax and wane on business conditions. So, when Apple and Amazon show continued strength, the Feds will take note. The increased revenue and net income in these two trillion dollar+ companies would argue against a rate cut. However, they are not the only companies in the S&P500, and even given the welcome news in these earnings reports, both companies were down in afterhours trading. Why are the Feds Considering a Cut & What Does it Mean for Stocks & Bonds? The Feds are considering a rate cut because, according to Jerome Powell at the July 31, 2024 press conference, “The broad sense of the committee is that the economy is moving closer to the point at which it will be appropriate to reduce our policy rate, but we’re not quite at that point yet.” Rate cuts occur when policymakers are trying to stoke growth and limit the detrimental impact of a recession. During 21st Century recessions, there have been dramatic (terrible) declines in stock prices. Sophisticated investors know this. The mood among Wall Street whales in July was one of profit-taking and reallocating out of large caps and into small caps, which rose 10.71% in the month (source: S&P Dow Jones Indices). Rate cuts are perceived as good for the bond market because lowering interest rates should, in theory, increase the value of existing bonds and make it easier for companies to borrow money more affordably. However, the policy interest rate is only part of a more complicated story. There is still elevated credit and duration risk. Additionally, long-term bonds lost more than stocks did in 2022, and did not make up those losses in 2023.   Bonds earned gains in the Dot Com and Great Recessions, providing safety from the sizeable losses of stocks (-78% in the NASDAQ Composite Index in the Dot Com Recession, and -55% in the Dow Jones Industrial Average in the Great Recession). However, even if there is a slight increase in bond value after a few interest rate cuts, it’s unlikely that bond gains are going to erase the sizable paper losses of 2022. Interest rates are not projected to bottom out at zero, like they did in the wake of the Great Recession. Rather, the longer run projection for the Fed Fund rate is 2.8%. As a reminder, we began pointing out that we weren’t getting paid to take on the risk in bonds starting in the Great Recession and continuing through 2021. We encouraged people instead to lean into real estate between 2009 and 2015, and to always rebalance for a properly diversified portfolio with stocks and cash liquidity. Today, we can make a 5% gain on the safe side of our plan, but it’s tricky. We’re getting a higher yield on short-term over long-term bonds. (So, we’re rewarded for taking on less risk.) Since creditworthiness is a problem, we have to know how to navigate between high credit quality, short term issuances, and speculative companies that want to keep our money for decades. Join us for our Bond & What's Safe Master Class on Oct. 26, 2024 to learn more. (Prerequisite: a Financial Freedom Retreat.) It’s very important to remember that paper losses can be real. Many terms are longer than our own lifespan. And with the low credit quality in today’s world, the longer the term, the higher the risk that the company will have to restructure before they pay us back. I’ve been hearing a lot of pernicious rhetoric that clients are receiving with regard to the return on their managed portfolios, where “paper” losses are glossed over and not included in the calculation. The truth lies in the brokerage statements – which many of us never read (or don’t know how to read). It’s quite important for us to understand exactly what we own and why, and to be the boss of our money instead of having blind faith in whatever we’re being told. It’s a better idea to fix the roof while the sun is still shining. Everything gets more difficult when the economy slows down or hits a recession. While a recession isn’t forecast for 2024, 2.1% GDP growth is pretty anemic growth, particularly given the elevated prices of stocks and the alarming levels of debt. Best Strategy for Stocks We’re overweighting 20% safe in our sample pie charts based on the elevated risk of equities. Stocks are expensive. GDP growth is expected to be lower this year than last year. There’s a lot of political uncertainty in the world. Now would be a great time to do our rebalancing to make sure that our wealth plan is age-appropriate, properly diversified, and that we capture gains near an all-time high. (We have a free web app for you to personalize your own sample pie chart. Email [email protected] with FREE WEB APPS in the subject line for a link.) Best Strategy for Bonds Keep the terms short and the credit quality high. Under that umbrella, if you want to add a little duration, maybe two years, but under five years, be sure that all of the other safety nets are in place, including high credit quality and FDIC coverage (in bank products). I would also have rolling maturity dates. I would be mindful of the fine print, and understand what risks I was taking in any “safe” fixed income product. Remember that over half of the S&P 500 is at or near junk bond status, and that includes a lot of banks, brokerages, insurance companies, fund companies, fintech companies, etc.  Source: Treasury.gov As you can see in the above par yield table of U.S. treasuries, investors are getting paid more for short duration than for long. Bottom Line The FOMC is considering a rate cut in September because the economy is slowing down, unemployment is creeping up, and inflation seems to be abating. All of those are signs of a soft landing that could indeed become a recession if they don’t get all of their calculations right. Because market conditions lag policy action, the FOMC always wants to be ahead of trends, rather than behind them. Likewise, when investors wait for the headlines, it’s too late. As you can see in the charts below, the recession announcement comes long after Main Street has lost a substantial part of their portfolio. With this in mind, it’s important to have a defensive strategy in both stocks and bonds, and not rely upon the idea that a rate cut is going to fix everything. There’s just a lot more to the story in today’s Debt World.   Join us at our online Oct. 18-20, 2024 Financial Freedom Retreat. Learn how to: * Invest in hot industries, such as Nvidia and artificial intelligence, * Hedge against a weaker dollar, * Invest and compound your gains, * Green your retirement plan, * Easy and efficacious nest egg strategies, * Get hot and diversified (including in artificial intelligence and EVs), * Evaluate stocks, * Keep an age-appropriate amount safe, and, * Know what's safe in a Debt World. You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. Email [email protected] to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. "Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.  Join us for our Online Oct. 18-20, 2024 Financial Freedom Retreat. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.  Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. There is very limited availability. Register by August 15, 2024 to ensure that you get the exact room you want. (There may not be an opportunity to register after August 15, 2024.) This retreat includes an all-access pass to all of our online training for a full year for two, and three 50-minute private, prosperity coaching sessions. Much more affordable than you might think. Email [email protected] to learn more.  Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The Power of 8 Billion: It's Up to Us and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 5th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is are the most recent releases of these books. Follow her on Instagram. Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden. Check out Natalie Pace's Substack podcast on Apple and Spotify. Watch videoconferences and webinars on Youtube. Other Blogs of Interest Fast Fashion. Fossil Fuels. Plastic Clothing. Atacama Desert Waste Dumps. Can Crowdstrike Recover from its Colossal Catastrophe? Featuring a Cybersecurity Overview. Fintechs and Brokerages that Fail are Not FDIC-Insured. Stocks Keep Hitting New Highs. Are You Thinking "Capture Gains?" Nvidia Volatility. Salesforce Drops. Election Years With Negative Yield Curves = ?. 5 Green Tips for Clean Beaches Week. Nio Sales Expected to More Than Double in 2Q 2024. So, You Think You Want to Be a B&B Owner... Artificial Intelligence and Crypto Scam Alert by the SEC. Netflix Evicts Unpaid Viewers. Empty Theaters. Retiring Soon? Start Planning Now. 2024 Rebalancing IQ Test. Answers to the 2024 Rebalancing IQ Test. May is National Bike Month. Paris and Amsterdam are the Stars. AI, Gold & Copper are on Fire. Sunpower Doubled. Sell in May and Go Away? What About the Election? Vacations that Color Our World Forever. The Magnificent 7 Drop to the Fantastic 5 9 Inflation, Budgeting, Debt Reduction and Investing Solutions. China & Russia Double Their Gold Holdings. 2024 Investment of the Year? The Reddit IPO. Meme Stock or Snap Land? Tesla's Factory in Germany Taken Offline by Activists. Bitcoin Sets a New Record High. The Importance of Rebalancing. Beyond Meat's Shares Surge. Quaker Oats' Pesticide Problem. Stocks are Flying High. Why Aren't Mine? Cut Your Tax Bill in Half. 9 Tips. Celebrity Jet CO2. Green Washing. The Facts. Some Solutions. Copper: Essential to the Clean Energy Transition. Uh. Oh. More Bank Trouble. Are Amazon, Square and Other Tech Companies Ripping Us Off? Housing. Unaffordable. What Works? Case studies and creative solutions. Don't Reach for Yield. Closed-End Funds. 2024 Investor IQ Test. Answers to the 2024 Investor IQ Test. Apple's Woes Drag Down the Dow. The Winners & Losers of 2023. Ozempic, Magnificent 7 & Beyond. 2024 Crystal Ball. The Underperforming DJIA, Full of Fossil Fuels and Forever Chemicals. A Spectacular Year for 3 of the Magnificent 7. The Best ROI* (Almost 40%!) & 7 Life Hacks That Save Thousands. Portugal Eliminates Tax Advantages for Ex-Pats. Earn $50,000 or More in Interest. Safely. Finally. WeWork's Bankruptcy. Half-Empty Office Buildings. Problems in our Personal Wealth Plan. Solutions for Unaffordable Housing. Cruise Ships Give Freebies to Investors. Should You Take the Bait? Should You Take a Cruise? Bonds. Banks. The Treacherous Landscape of Keeping Our Money Safe. 7 Rules of Investing 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 & Save a Boatload of Dough. China Bans Apple 11-Point Green Checklist for Schools. Artificial Intelligence and Nvidia's Blockbuster Earnings Report Biotech in a Post-Pandemic World 10 Wealth Secrets of Billionaires and Royals. What Happened to Cannabis? Bank of America has $100 Billion in Bond Losses (on Paper) Lithium. Essential to EV Life. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? Are There Any Safe, Green Banks? 7 Ways to Stash Your Cash Now. Lessons from the Silicon Valley Bank Failure. Which Countries Offer the Highest Yield for the Lowest Risk? Why We Are Underweighting Banks and the Financial Industry. Save Thousands Annually With Smarter Energy Choices Is Your FDIC-Insured Cash Really Safe? Money Market Funds, FDIC, SIPC: Are Any of Them Safe? My 24-Year-Old is Itching to Buy a Condo. Should I Help Him? The 12-Step Guide to Successful Investing. The Bank Bail-in Plan on Your Dime. Important Disclaimers Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly traded companies or funds mentioned by Natalie Pace are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect a diversified strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience. Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors. |
AuthorNatalie Pace is the co-creator of the Earth Gratitude Project and the author of The Power of 8 Billion: It's Up to Us, The ABCs of Money, The ABCs of Money for College, The Gratitude Game and Put Your Money Where Your Heart Is. She is a repeat guest & speaker on national news shows and stages. She has been ranked the No. 1 stock picker, above over 830 A-list pundits, by an independent tracking agency, and has been saving homes and nest eggs since 1999. Archives
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