Reddit IPO. Meme Stock Flying or Crashing in a Snap? Meta (Instagram, Facebook, WhatsApp) is one of the Magnificent 7 and has soared to all-time highs this year with a market cap of over $1.23 trillion. Reddit is listing publicly this week, on March 21, 2024, with a more modest $6.5 billion valuation. Does that make Reddit a great investment opportunity, particularly if you are a Reddit moderator who has been invited to participate in the Direct Share Program? Will Reddit rocket up like a 2021 meme stock, or will it sink like Snap, Inc., which has lost -85% of its value since its September 2021 high of $83.11/share? (Snap is now trading at $11/share, with a market value of $18.5 billion.) Here are the things we will cover in this blog. Reddit Relevance & Ranking Will the Reddit IPO Shoot the Moon? Beware of Investors Jumping Ship: Founders Get Rich or True Investor Opportunity? Will the Reddit IPO Have a Crash Landing? Dependent on Advertisers & Selling User Data Cash Negative for 20 Years And here is more information on each point. Reddit Relevance & Ranking Reddit has street cred among its users and "aspires to be the heart of the Internet." Meme stocks, including the GameStop phenomenon, were launched and fueled in the Wall Street Bets subReddit community. Will loyal users and moderators want to become shareowners? Are Redditors worried about losing the things they love most about Reddit to profiteers, once the company is publicly owned? In terms of relevance, Reddit is not one of the more widely used social media platforms or apps, according to Comscore. In January 2024, Reddit ranked 31 in the Top 50 Multi-Platform Properties (Desktop, Mobile, and Social). Google, Microsoft, Yahoo, Comcast (NBCUniversal), Facebook, Amazon, Walt Disney, Paramount Plus, Raptive and Apple are in the Top 10, in that order. Bytedance (the owner of TikTok) ranked 21. Reddit scored more unique visitors than Netflix (#43) in January. Snap wasn't in the Top 50. Reddit is not on the list of the Top 25 Smartphone Apps (source: Comscore). Youtube, Facebook, Gmail, Google Search, Google Maps, Amazon, Instagram, TikTok, Facebook Messenger and Google Play are the Top 10 Smartphone Apps. Snapchat is 21. Spotify is 11. Will the Reddit IPO Shoot the Moon? I perused some of the conversations on Reddit that are talking about the IPO. What I found was a lot of skepticism. Many of the commentators assumed it was just a way for the insiders to take the money and run, and speculated that once the website was beholden to quarterly earnings reports many of the free options they like would become premium features. On the popular WallStreetBets subreddit, most of the posts discussed shorting the stock. The few bullish commentators admitted that their opinions were unpopular. Users were also concerned about having their data sold. Although Reddit is currently heavily reliant upon advertising revenue, the company wants to expand into data licensing. According to the Reddit S-1 filing, Reddit expects “our growing data advantage and intellectual property to continue to be a key element in the training of future LLMs.” Artificial intelligence is hot on Wall Street, so it’s a smart move to position the company as providing important data to the giants in that space, like Nvidia. If Reddit becomes a player in artificial intelligence, the company could become more exciting. Of course, every social media company lays this claim, and many of them have a lot more traffic and users. Beware of Investors Jumping Ship: Founders Get Rich or Investor Opportunity? Reddit has been around for about 20 years and has never turned a profit. The net loss was lower in 2023 than in 2022, at $(90.8) million versus $(158.6) million in 2022. However, most of the cash-bleed curtailment was due to high interest rates, and the ability to earn some income on their marketable securities. You can bet that the VCs, founders and executives are chomping at the bit to turn some of their paper wealth into hard cash. According to the S-1 filing, the lockup period for insiders ends on the 3rd trading day after Reddit files their June 30, 2024 earnings report, or on August 22, 2024, whichever occurs first. Whatever happens on March 21, 2024, which is the first day of trading, late August should be a very active time for the Reddit stock. While VCs and insiders became billionaires by holding shares of the Facebook and Google IPOs, more recent unicorns have had trouble flying, including Snap, Inc., Lyft Inc., Robinhood and WeWork. We Co’s IPO crashed and burned in August of 2019. The company declared bankruptcy on Nov. 6, 2023. Snap has held on as a company, but is trading -35% under its IPO price of $17/share. Will Reddit Crash Land? The recent history of the IPOs of unicorns and technology/communications companies doesn’t augur well for Reddit. However, even though the meme stock mania is more humble these days, there is no free money being deposited into our accounts that we can play with, and the Crypto Winter has only recently defrosted, we’ve still seen euphoric buying in the Magnificent 7. Most of those companies have more than doubled in share price over the past year. According to Howard Silverblatt, the senior index analyst of the S&P500, "Nvidia, Microsoft, Meta Platforms and Amazon.com account for 60% of the year-to-date 7.28% return [of the S&P500] (with Nvidia accounting for 32%)." Reddit’s future might depend on its ability to sell its users’ data to artificial intelligence companies – a space that is currently the hottest story on Wall Street. So, even though Redditors aren’t very enthusiastic about the IPO at this time, if there is an exciting earnings report in Reddit’s near future, particularly if there is a jump in AI data licensing, the game could change quickly. If it happens before the insider lockup period ends, we could see the executives and VCs holding rather than selling, as Main Street investors pile in on the good news. If after, there could be a lot of volatility in 2024. There are a lot of if’s that will be resolved over the coming months. Dependent on Advertisers & Selling Data Positioning Reddit data for artificial intelligence learning is a relatively new venture for Reddit. Currently, most of the revenue is still tied to advertising. According to WARC Media, global advertising spend should increase 8.2% in 2024, to surpass a trillion dollars, with advertisers favoring digital platforms, such as Alpha, Meta, Amazon and Reddit. Political advertising will be rampant in 2024’s Presidential election. In 2023, Reddit’s revenue increased almost 25% over 2022, to $804 million from $667 million in 2022. During times of economic slowdowns, advertising is the canary in the coal mine, with ad spend getting chopped dramatically. Most analysts are predicting a soft landing with no recession in 2024. However, economic data is finicky. As an example, we thought we had beaten inflation, only to see the Consumer Price Index kick up to 3.2% year over year in February 2024. Cash Negative for 20 Years Meta is profitable. Weibo, the Twitter of China, is profitable. Snap Inc. has been cash negative since inception, as has Reddit. Small companies have more difficulty borrowing money, particularly if they haven’t found their pathway to profitability. Reddit’s current cash position is sound, with over $1.2 billion in cash and marketable securities. As I mentioned above, one of the biggest reasons that Reddit’s net loss was lower in 2023, was the return that they were able to make on their marketable securities. If interest rates get cut later this year, so will Reddit’s ability to earn a decent yield. If the company goes back to the 2022 cash burn rate, they cut their runway to profitability and could be flying too close to the trees. Investors will be looking at the bottom line, as much as the top line growth, over the next few earnings reports. Bottom Line Small caps have been punished by Wall Street of late, particularly cash negative companies. Insider liquidity events designed as IPOs have had a hard time getting off the ground over the past decade. The Reddit IPO doesn’t have the meme stock momentum that its platform stirred up for AMC and GameStop during the pandemic stimmy check anomaly. I would not be surprised if the projected Reddit share price of $31-$34 a share takes a nose dive after the IPO. The future of the company’s share price and valuation could be linked with AI and selling user data – something that their community might push back on. We’ll know more in the coming months – particularly in late August, when the company files their June 2024 earnings report and the insiders are freed up to sell. Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to invest and grow your wealth, green your retirement plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence and EVs), how to evaluate IPOs and other stocks, and 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 info@NataliePace.com 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 info@NataliePace.com for pricing and information.) Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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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Tesla Hit By Activists. Is That Why the Stock Is Near a 52-Week Low? Should You Buy Now? On Tuesday, March 5, 2024, the Volcano Group (activists) took down Tesla’s power in their German plant. It’s expected to cost the company a billion in damages and prevent the plant from building 1,000 vehicles each day. The company was reconnected to the grid today (March 11), and has advised that the resumption of production will be a gradual process. The automaker previously paused production at the end of January for two weeks due to supply chain disruptions caused by the Red Sea attacks. These two events could reduce the 1st quarter production by 20,000 vehicles or more. However, it’s unlikely to harm sales, as Tesla has been building up inventory and shouldn’t have trouble keeping up with deliveries. The bigger question is why is year-over-year revenue up only 3.0% at Tesla – one of the lowest growth on the auto stock report card. Can Tesla justify a $567 billion market cap and 41 P/E with low single-digit growth? Why did the company share price sink to just $178/share, after topping out at $299/share in July of 2023? Below are the issues we’ll cover in this blog. EV vs. ICE Sales Growth China EV Exports Price Wars Forward Outlook: Consumer Spending Consumer Debt + Rising Defaults on Auto Loans and Credit Cards The Higher the Dividend, the Higher the Risk And here is more information on each point. EV vs. ICE Sales Growth EVs continued their surge in the U.S. in 2023, with year-over-year sales growth of 46% and sales/leases of 1.1 million, according to Motor Intelligence. In the 4th quarter, EVs hit 8.1% market share (by volume). Tesla sold the majority of EVs in the U.S., with 654,888. (Tesla’s total sales for 2023 were 1.81 million, an increase of 38% YOY.) The real story is China, however. Inside EVs is reporting that 8 million plug-in electric vehicles were sold in China in 2023, amounting to 36.5% of the country’s auto market. 21.9 million cars were sold in China in 2023. Chinese EV Exports Chinese EVs are gaining in popularity around the world. Tesla’s Model Y was the top selling auto globally in 2023, with 1.2 million in sales (source: Tesla). However, exports of Chinese vehicles surged 63.7% in 2023 (source: China Association of Automobile Manufacturers), with 4.1 million vehicles exported. This puts China in 1st for auto exports, and Japan in 2nd with 3.6 million vehicles. (840,000 of Chinese vehicle exports went to Russia. European and Japanese carmakers pulled back on their sales there due to the war in Ukraine.) Price Wars It seems like every day there is another EV startup, and 2023 was the first year that China exported more cars than any country in the world. BYD Co., a Chinese carmaker that is not publicly traded in the U.S., is the top selling brand in China, with ½ of the bestselling cars. Tesla’s Model Y and Model 3 are #1 and #3, respectively. BYD just lowered the price of its bestselling auto, the Yuan Plus crossover, to $16,644. GM (SAIC-GM-Wuling) is competing at the BYD price point in China with its Baojun Yep EV, with a price of just $11,900. That compares to the Tesla Y price of over $36,000 in China (and over $42,990 in the U.S.). China’s Nio makes luxury cars that compete directly with Tesla, Porsche and Mercedes. The price wars are happening at both ends of the price spectrum and are impacting profit margins. Many Chinese EV makers have declared bankruptcy or suspended operations, including Human Horizons and WM Motors. Lucid Motors saw its 4Q 2023 revenue decline by -39% year over year. GM and Ford have revised their plans to transition out of ICE (internal combustion engines) and into EVs, largely on concerns of profitability and the price wars. Email info@NataliePace.com if you’d like an Auto Stock Report Card. Forward Outlook: Consumer Spending Nio is projecting flat revenue and deliveries year over year for 1Q 2024. In their 4Q 2023 quarter earnings deck, Tesla admitted that “In 2024, our vehicle volume growth rate may be notably lower than the growth rate achieved in 2023.” If the April 2nd 1Q 2024 Tesla deliveries report is lower than expected, disappointed investors could continue selling. (Nio is already trading at a 5-year low.) Tesla shares have already plunged -31.4% since the Dec. 27, 2023 high of $261/share, down to $179/share today. However, Tesla’s price-earnings ratio is still very elevated at 41. Tesla’s 1Q earnings report will be released around April 19, 2024. Price wars aren’t the only economic storm on the horizon. Consumer spending could become an issue, as well. The American consumer has been resilient amid the headwinds of inflation. However, the personal savings rate* is at an historic low and defaults on credit cards and auto loans have started to creep up. * The percentage of people's incomes left after they pay taxes and spend money. Consumer Debt + Rising Defaults on Auto Loans and Credit Cards U.S. household debt hit another all-time high of $17.5 trillion in the 4th quarter of December of 2023. “Credit card and auto loan transitions into delinquency are still rising above pre-pandemic levels,” said Wilbert van der Klaauw, economic research advisor at the New York Fed. “This signals increased financial stress, especially among younger and lower-income households.” Auto loan delinquencies are still quite low, at just 2.66%, and the U.S. may avert a recession in 2024. However, it’s important to remember that carmakers struggle in slow economic and recessionary times. General Motors and Chrysler declared bankruptcy in 2009. However, the companies’ troubles began years before the Great Recession. The Higher the Dividend, the Higher the Risk At today’s valuations, Tesla’s debt/equity ratio is just 0.08. By comparison, GM and Ford still have very elevated debt levels and D/E ratios, at 1.89 and 3.49, respectively. Tesla, like many growth companies, doesn’t pay a dividend. GM and Ford, like many legacy brands, do, with 1.22% and 4.83% yields, respectively. In today’s world, it’s very important to understand credit risk, and to note that much of the time, the higher the dividend, the higher the risk of losing principal. Bottom Line Autos don’t do well in slow economic or recessionary times. While electric vehicles remain the most exciting growth area of the automakers, the price wars and plethora of startups have complicated the opportunity for investors. Tesla’s high price, even with the 2024 pullback, could invite more profit-taking and selling, particularly if next month’s delivery and earnings reports are lower than expected. The heated competition in China, combined with Chinese equities being out of favor with U.S. investors, have drug the share prices of many former meme stock darlings, such as Nio and Xpeng, to 5-year lows. While the valuation and price of Nio is attractive and their cars are receiving great reviews – Nio cars have won awards in Germany, Sweden and Norway – the economic headwinds and competition could continue to weigh on the potential returns of all Chinese EVs. Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to invest and grow your wealth, green your retirement plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence and EVs), and 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 info@NataliePace.com 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 info@NataliePace.com for pricing and information.) Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Bitcoin Sets New Record High. The Importance of Rebalancing. Bitcoin’s all-time high of $69,000/coin was hit on November 9, 2021. Yesterday, Bitcoin set a new record of $69,324/coin, but has since retreated back to $67,000. That’s great news for anyone who has lived through the long Crypto Winter that began after that November 2021 high. Bitcoin dropped as low as $15,460 by Nov 20, 2022, just one year later. Total gains since that Nov. 2022 low are 333% for the best performing asset – far above the 24.3% gains in the S&P500 and the 105% gains of the Magnificent 7 in 2023. However, that’s quite a rollercoaster ride. Is HODL really the best strategy? Many lessons that apply to Bitcoin also apply to our entire nest egg. Below are a few of the things we will cover in this blog. Crypto: Currency, Safe Haven, Buy and HODL, or Get Rich Quick Scheme? Hot Industries The Importance of Rebalancing Staking The Magnificent 7 Clean Energy Which Coin is Right for You? And here is more information on each of the topics. Crypto: Currency, Safe Haven, Buy and HODL, or Get Rich Quick Scheme? Crypto is largely a trader’s platform. The average holding time of Bitcoin and Ethereum is less than three months. When we HODL, especially if we buy at the top, we are krill playing into the profits of the whales. Although a lot of people consider cryptocurrency to be a safe haven, or even the only kind of currency that will be worth anything when the dollar becomes completely worthless, you can’t have a currency that is worth $69,000 one month and $16,000 the next month. The whole point of currency is that the value will remain constant. Due to the share price volatility, the only people really using crypto as a currency are those who are operating in the shadows, with that concern being far greater than price stability. Many predators prey on our emotions, using scare tactics to prompt action, claiming that their ruse is the only cure. Another problem that prevents Bitcoin and other cryptocurrency from becoming widely adopted is the limitation on certain coin mining and the plethora of coin options to choose from. Imagine the hassle of carrying a wallet full of pounds, yen, euros and dollars. Additionally, crypto mining is not very planet friendly. Global Bitcoin mining consumed 173.42 TW hours of electricity between 2020 and 2021, ranking it 27th in the world if it were a country. Water usage was enough to feed 300 million people in rural sub-Saharan Africa and the land footprint was bigger than Los Angeles. Bitcoin minors are trying to address this with cleaner energy. However, the CO2 emissions are still currently a problem, and even clean energy requires a lot of CO2 to create. Hot Industries When we think of an investment that can hold strong in weak economic times, it’s a better idea to consider the safe haven as a slice of our overall diversification plan, rather than the one and only thing we believe in. Whether it is crypto or gold, the swings in investor sentiment are wild, and the periods of it being out of favor can be epic. Gold has been one of the worst performers of the last decade. (Bonds were worse; if you don't know how to preserve your wealth in a Debt World, join us at our April 27-29, 2024 Financial Freedom Retreat.) After the highs of $800/ounce in 1980, gold plunged by almost half in 1981, sank down to $376/ounce by 1982 and stayed in that range until 2006 – for a doldrums that lasted a quarter of a century! When our safe haven is a slice or two of our nest egg plan, we can preserve our wealth, while limiting the wild swings in our personal net worth. It also helps us to capture gains at the top, and add more at the low, which is a time-proven stalwart in successful investing. Regular rebalancing is another important tool. We teach this strategy at our Financial Freedom Retreat. The Importance of Rebalancing If your cryptocurrency plan loses 76% and stays there for almost 2 years, it’s more than just emotional distress. Having your $1 million go down to just $240,000 can ruin our FICO score. It prevents us from purchasing other investments (such as AI), including maybe a home. If we have started a project, such as a home remodel, we might not have the funds to finish. All of this financial distress is hard on our family, and could be enough to plunge us into a depression or worse. Simply rebalancing and capturing gains at the high affords us the liquidity and emotional fortitude to purchase more when the price tanks. Rebalancing once, twice, or three times a year is an important discipline to keep our personal wealth plan properly diversified and growing. Bitcoin is up 4.5 times from its low in Nov. 2022, and gained 171% in 2023. Whenever we see this kind of shoot the moon performance, it’s a good idea to capture gains. In the pie chart system, when one slice becomes four, it’s time to sell high and trim it back, increasing our net worth, while ensuring we take the gains off paper (and the rollercoaster) and capture them. If we’re invested in crypto because we’re sick of banks, then we can consider turning our profits into an income-producing hard asset that we purchase for a good price. (This is another strategy we teach in our Financial Freedom Retreats.) Staking Staking can tie up our access to our coins. This makes it very difficult to protect our wealth from drops in value, or to capitalize on the wild and ferocious gains that can occur over a very short period of time in crypto. The Magnificent 7 We’ve all been hearing a lot about artificial intelligence and the Magnificent 7. As I mentioned in my blog on Jan. 2, 2024, without the spectacular gains of these seven stocks, with their average 105% rise, the S&P500 would have had 9.94% gains in 2023, rather than the 24.23% rise in value and 26.3% total return. A lot of conservative wealth plans don’t have any large growth or a hot slice of AI. If your performance last year was beneath the 24% gains in the S&P500, chances are these are areas to look at adding. If your plan lost money or performed in the low single digits, long-term bonds might be the problem. (I offer unbiased 2nd opinions. Email info@NataliePace.com for pricing and information.) Clean Energy Clean energy is another industry that has very wild swings in share price. Here again is where regular rebalancing can help us to stay on the right side of the trade. At the bottom of the pandemic, the iShares Clean Energy ETF: ICLN was trading at $8.70/share. By Jan. 8 2021, the price soared to $33/share, for 3.8 times gains. Today, the price is back down to $14/share. We miss out on a lot of gains, if we’re not doing our regular rebalancing. Which Coin is Right for You? How do you know which coin is right for you? All currency is based on trust – trust that the currency will hold its value, and that the institution underwriting our holding is honest and fiscally sound. There has been a great deal of coin scams, including very high profile ones that are marketed by popular celebrities. FTX comes to mind because you’d have to be living under a rock not to have heard about SBF and his potential 100-year prison term, which will be determined this month. Tom Brady, Gisele Bundchen, Stephen Curry and even Larry David were caught up promoting that ruse. Kim Kardashian settled with the SEC for $1.2 million for promoting the EMAX coin – another pump and dump scheme. We also had a problem with 3 Arrows and Voyager Digital, a trading firm that claimed FIDC-insured coverage, which turned out to be false. (Click on the 6 Red Flags blog to learn more.) Other outright scams include the Trade Coin Club, which was a pyramid scheme posing as an MLM opportunity. If you’re sent an email or a social media post, that’s a red flag that it’s a marketing scheme. Is the opportunity being presented by someone under 40 with no experience in business? Should you really trust this stranger to protect your wealth? Bitcoin and Ethereum are the two most popular cryptocurrencies. The Tesla website claims to take Dogecoin for some of its products. Tesla took Bitcoin for a hot minute, but no longer does. Ethereum has suffered since the NFT craze evanesced. Will it have a renaissance? Bottom Line If we’re interested in a hedge against a weakening dollar, or a safe haven against a slowing economy, cryptocurrency could be a good choice for a hot slice or two of our plan. It’s also important to rebalance regularly, so that we step off the price swing rollercoaster, and into our party suite of gains. Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to invest and grow your wealth, green your retirement plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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 info@NataliePace.com 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 info@NataliePace.com for pricing and information.) Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Beyond Meat’s Shares Surge. Quaker Oats’ Pesticide Problem. Beyond Meat’s shares jumped almost 40% after it announced earnings on February 27, 2024. Is this a renaissance of the brand? What about Quaker Oats’ pesticide problem? What’s interesting about Beyond Meat’s rally is that it didn’t happen because the company is selling more product. In fact, Beyond Meat is having to cut prices to compete with animal protein. Investors pushed the stock up on a promise from the CEO to stop losing money in 2024. Revenue actually dropped -8% year over year. Sales could sink another -24% in the first quarter of 2024. Quaker Oats has made headlines because a pesticide that is linked to infertility in animals has been found in 92% of samples of non-organic Quaker Oats and Cheerios and in the humans who eat them. This toxic pesticide requires very special handling by farmers. It is not legal for food use in the U.S. The loop-hole is that the fertilizer is approved for imported oats. Pepsico owns Quaker. How will this impact the parent company and the consumer staples industry? FYI: In a year where the S&P500 had 24.23% gains (26.3% total return in 2023), the consumer staples industry lost -2%. Here are the Things We’ll Discuss in This Blog Beyond Meat Shares Surged 38.8% After Reporting Earnings on Tues. Feb. 27, 2024 Meat Price Wars (Tyson Foods Way Down, Too…) Historical Context Climate Considerations: Plant-Based Meat vs. Animal Protein Regenerative Agriculture vs. Pesticides and Inputs Cash Bleed vs. Cash (Tyson is Cash Negative, Too) Forward Outlook And here is more information on each point. Beyond Meat Shares Surged 38.8% After Reporting Earnings on Tues. Feb. 27, 2024 While Beyond Meat’s commitment to a pathway to profitability is important, the company has very tempered expectations for 2024 based on weak demand, inflation, the cost of borrowing and concerns about a slowing economy. Beyond Meat expects their gross margins to be in the mid to high teens range in 2024. With only $206 million in cash and cash equivalents, stopping the cash bleed is vital, especially since the price of animal protein has been below plant-based protein of late. Meat Price Wars (Tyson Foods Way Down, Too…) Net revenues were $73.7 million for Beyond Meat, down -7.8% year over here. According to the company’s 4Q 2023 earnings report, the decrease was largely due to a 14.6% drop-in net revenue per pound. Tyson Food’s net revenues were flat year over year. Tyson lost $648 million in fiscal year 2023. If you’d like a Protein Stock Report Card, email info@NataliePace.com. Historical Context During the pandemic, some meat factories had to be closed. People were hoarding everything. Oftentimes there just wasn’t any animal protein (or toilet paper) available at the store. Grocers began placing plant-based protein in their butcher counters. People started stocking their freezers with that, too. Beyond Meat’s all-time high of $240/share was in 2019. It was down to $158/share in January of 2021. Shares closed this week at $9.77/share. Once the butcher shop was full of animal protein again, at a price that was more affordable than plant-based protein, non-vegetarians went back to meat. Of course, there are plenty of vegans and vegetarians in the world, who are always going to be looking for plant-based options. However, during the pandemic, when plant-based protein was all that was available, meat-eaters were buying it, too. Climate Considerations: Plant-Based Meat vs. Animal Protein Industrialized cattle raising is very heavy on CO2. Rain forests are razed, emitting CO2, and also wiping out one of the most valuable ways to draw down CO2 – ancient trees. Additionally, the cattle are often fed grain instead of grazing on grasslands. The grain is trucked in from far away. Animals are often farmed in foreign countries, such as Brazil or India, and then flown, shipped and trucked to consumers around the world. When anyone says that cows emit more pollution than cars, the statement is inaccurate, as you can see quite clearly in the CO2 emissions chart below. However, the industrial farming model is very hard on the environment largely due to the transportation pollution and forest and soil depletion noted above. It’s important to be aware of the fact that just 20 oil and gas companies (and the consumers who purchase their products) are responsible for over 1/3 of the CO2 in the atmosphere. That doesn’t give us a pass on eating a pound of flesh at every meal. The general consensus is that eating less meat protein is good for the planet, and a balanced diet that is rich in rainbow-colored produce is better for personal health. Additionally, it’s important to eat local and organic/regenerative meat and produce. Regenerative Agriculture vs. Pesticides and Inputs Quaker Oats made headlines this week because studies have found pesticides in Americans that are well above where they were just a few years ago. Food grown organically with regenerative agriculture practices does not rely upon pesticides, herbicides, or chemical fertilizers. So if you still want to eat oats, you might just consider an organic oat option. Quaker Oats is owned by Pepsico. The company accounts for about 4% of Pepsi’s revenue, so this is unlikely to be a brand killer. In fact, just a few days before the pesticide problem was reported by the Journal of Exposure Science and Environmental Epidemiology, Pepsico launched a new campaign in Canada and Latin America to promote Quaker Oats. Chlormequat is not approved for use on food in the U.S. However, the FDA does allow the importing of oats grown with chlormequat from other countries. According to an NIH white paper published in 2020, in addition to inhibiting reproduction, “Maternal exposure to chlormequat chloride during pregnancy disrupts the embryonic growth.” Despite these risks, the EPA is considering allowing farmers to use chlormequat to increase their crop yields. Eastman Chemical is a major manufacturer of chlormequat. Some important new documentaries are educating us on the importance of regenerative agriculture, and how this approach is healthier for the planet, people and the farmers. The Common Ground film is in select theaters now. You can also watch our Earth Gratitude interview with Farmer Gabe Brown and the co-directors of Common Ground at our Earth Gratitude YouTube channel. Also, check out the documentary Kiss The Ground, which is available to watch on Netflix. What scientists have discovered is that regenerative agriculture can draw down CO2 very effectively. Farmers can save hundreds of dollars per acre on input costs, while growing nutrient-dense, delicious food, and ensuring that their soil is healthy and doesn’t turn to dust. There are a lot of reasons for optimism and hope that are outlined in these documentaries, and I encourage everyone to watch them. It’s time to educate ourselves about the many benefits of regenerative agriculture, and how we can support regenerative farmers with our consumer choices, and also by writing to our congressmen to have regenerative agriculture supported in our Farm Bill. Again, shopping for organic/regenerative meat and produce at Farmers Markets and grocery stores goes a long way to reducing the amount of harmful toxins in our bodies. Cash Bleed vs. Cash (Tyson is Cash Negative, Too) A lot of food companies lost money last year. Tyson Foods lost -$648 million. Oatly lost -$393 million. Beyond Meat lost -$338 million. Hain Celestial lost -$117 million. The consumer staples industry itself was one of only a few industries to lose money on Wall Street last year, when the S&P500 had a total return of over 26%. Consumer staples were down -2.16%. Energy was down -4.8% and utilities were down -10.2%. Compare this to the cash-rich Magnificent 7 doubling their share price. Food companies typically have low profit margins. Inflation is hurting the industry, and competition makes it difficult to pass the costs along to the customer. Outlook Beyond Meat is expecting another drop in revenue in the first quarter of 2024, from $92.2 million in 2023 to $70-$75 million in 2024. That’s a drop of almost -25%. The 2nd half of 2024 might strengthen. The company expects $315 million to $345 million in annual revenue, which would be similar to 2023’s $343 million (at the top end of the range). Bottom Line Inflation is hitting all industries. Those industries like artificial intelligence and technology that are able to increase prices, have robust profit margins, a treasure trove of billions of dollars in cash, and very low debt are in a great position to continue operating without having to borrow money at today’s higher interest rates. However, many food companies have very low margins of profitability, which put a lot of them in the red last year. Be careful chasing gains on Beyond Meat just because you hear that the company’s share price jumped or their margins are expected to improve this year. One of the ways that we are, addressing the very elevated levels of debt in the United States, and the weakness in some value fund industries, such as consumer staples and banks, is to use value fund replacements. This is part of the curriculum offering in our Financial Freedom Retreat. Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to invest and grow your wealth, green your retirement plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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 info@NataliePace.com to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register by Feb. 29, 2024 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 info@NataliePace.com for pricing and information.) Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Stocks are Flying High. Why Aren’t Mine? Investors Ask Natalie. Dear Natalie: Every day I hear that stocks are hitting new highs. Yet my personal plan isn’t seeing such spectacular gains, and many of my positions are losing money. Why aren’t my stocks performing as well as the stock market is? Not FOMO – RMO (Really Missing Out) Dear Really Missing Out, Your brokerage statement is showing that your returns were terrible last year, with 26% total gains in 2023 in the S&P500 vs. your 5% gain. FYI: The Dow Jones Industrial Average gains were only 13.9% in 2023. Without the Magnificent 7, the S&P500 gains would have been just 9.94%. It's also important to put things in perspective. As you can see in the chart above, the superior returns of 2023 didn't even bring the S&P500 back to the highs of 2021. The index finally started ringing in new highs this month -- February of 2024. In addition to having a properly diversified plan that protects our wealth, it's important to rebalance regularly to capture gains. Otherwise, we could be riding a Wall Street rollercoaster (as is exemplified in the performance chart above.) After taking a look at your plan, there are a few problem areas that are causing your portfolio to severely lag the performance of the S&P500. These issues are pretty common in both retirement plans (especially those target date retirement funds) and managed portfolios. So I’m encouraging everybody to take a forensic look at their statements, and see how your plan is performing next to the S&P500. Many plans are performing at half the speed, and some, particularly for people who are closer to retirement, might even be losing money. Here’s why. Five reasons many portfolios are lagging the spectacular 2023 performance of the S&P 500. 1. The Magnificent 7 2. Long-Term Bonds 3. Missing Hot Industries 4. Overweighted in Value 5. Underweighted in Growth And here is more information on each point. 1. The Magnificent 7 A lot of people aren’t aware that the Magnificent 7 is largely responsible for Wall Street ringing up record highs this month. The Magnificent 7 stocks have doubled over the last year. Nvidia more than tripled. As you can see in the data I listed at the top of this blog, without the support of the Magnificent 7, the stock market would’ve been up 13%-ish rather than 26%. You don’t have any large cap growth in your portfolio (where the Magnificent 7 stocks would be), or a fund that specializes in the Magnificent 7. The few stocks you have are ones that actually lost money. 30% of the Dow Jones Industrial Average companies lost money in 2023. (Click on the blue-highlights to read more.) 2. Long-Term Bonds Long-term bonds lost even more than stocks did in 2022, at -26%. 2023 saw a small recovery, but nowhere enough to make up for the losses in 2022. Since this is on the safe side of our portfolios, it’s very important to know what is safe in the post-pandemic Debt World that we live in. Even the banks, with their Ivy-League C-Suites, are having trouble getting this right, as evidenced in the bank failures. (We’re still underweighting the financials industry, including insurance companies and brokerages.) Everyone is counting on a recovery of bonds if interest rates start getting cut in the latter part of 2024 and in 2025. However, there’s a great deal of duration risk and credit risk that remain even if the interest rate risk has abated. With regard to bonds, it’s a good idea to keep the terms short and the creditworthiness high until the duration and credit risks have been worked out. (That process can be painful to bond investors who have skin in the game.) We spend one full day on What’s Safe in our Financial Freedom Retreat. Commercial real estate is one of the areas of heightened risk in bonds and the economy, with potential ramifications on the banking industry and financial stability. 3. Missing Hot Industries In addition to having large cap growth and proper size/style diversification, we could lean in even more to the Magnificent 7, with a hot slice in our nest egg pie chart. It’s a good idea to invest in hot industries, such as artificial intelligence, cyber security, copper, crypto, gold, or even other countries. A well-diversified portfolio can include up to four slices of hot industries. Regular rebalancing helps us to capture and keep our gains when a particular industry or country shoots the moon, rather than riding the Wall Street rollercoaster. This plan, which we teach at our retreat, also helps us to invest the appropriate amount, rather than bet the farm. 4. Overweighted in Value Value funds are very problematic, particularly in the United States. When stocks are at all-time highs with elevated price-earnings ratios, nothing is actually on sale. The other side of the issue is that the companies/funds that are trading for a muted price tend to be market laggards with a great deal of concerns, including massive debt, pension and other post-employment benefit liabilities, and slow growth. Many of the Dow components that lost money in 2023 are stuck in the value funds. For this reason, we’re suggesting value replacement funds in our sample pie charts. We can diversify into other countries and get exposure to industries that are very underweighted in most of the U.S. funds, including materials, utilities, and consumer staples. As I mentioned above, many of these funds offer a higher dividend, and some also come with higher credit quality. 5. Underweighted in Growth Growth funds offer much lower dividends than value funds. However, missing out on growth industries in 2023, such as artificial intelligence, cyber security and technology, meant we missed out on the spectacular gains of equities. Knowing what we own, and having the proper mix of value, growth, small, medium and large caps, and hot industries, is a great way to protect our wealth, while also improving performance. Bottom Line Your plan has too many long-term bonds, bond funds and value stocks. This could continue to be a problem even if interest rates get cut. So, now is the time to get properly diversified and protected. If others reading this blog are worried about their wealth plan, now is the time to really know how to read your brokerage statement properly. The statement should reveal what your portfolio performance is compared to the S&P500 over the last year, and even the five or 10-year period. Knowing why your plan is underperforming might require getting an unbiased 2nd opinion. I have a coaching client who was told that he was earning 5-7% on his “conservative” investments. The real return was under 2%, due to the principal loss in value of his holdings. This was written in plain sight on the statement. He (and many of us, really) just didn’t know where to locate that information, and how to decipher the document. (Click to learn more.) When we consider how much money we have in our retirement plans and brokerage accounts, it can be more than we make in many years of earned income. So, being the boss of our money and protecting our wealth, while growing the at-risk side safely on par with the S&P 500, can be time and wisdom that is well-spent. Once we learn the life math that we all should’ve received in high school and college, and implement these strategies, all we need to do is to rebalance once, twice, or three times a year. Once we build our solid financial house, we just need to Spring clean once a year. (If you’d like an unbiased 2nd opinion on your plan, such as the person sending in this question received, email info@NataliePace.com for pricing and information.) Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to invest and grow your wealth, green your retirement plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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 info@NataliePace.com to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register by Feb. 29, 2024 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 Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Cut Your Tax Bill in Half! 9 Tips. A lot of you have heard me say, “Stop making everyone else rich, including the tax man, the debt collector, the landlord, the gas station, the utility company, the insurance salesman, etc.” Tax season is the perfect time to start keeping more of your dough, which you can then use to invest (money while you sleep), to have more fun, and to buy things you like a lot more than the IRS. Even if you are taking the standard deduction, you’ll want to know about these strategies because many are tax credits that apply whether or not you itemize. Additionally, these strategies can also save us thousands annually in our budget. Below are 9 tips to start on the path. 9 Tips to Stop Making the Tax Man Rich! These tips will help you put your best leg forward on the path to financial freedom. See the list below for what applies to you, and then details on each tax credit/deduction below the list. 1. Health Savings Accounts. 2. IRA Contributions. 3. Mortgage Interest Deduction 4. Student Loan Interest Deduction. 5. Qualified Education Expenses. 6. Energy Efficiency and Clean Power Tax Credits. 7. Charitable Contributions. 8. Capital Gains 9. Facing an Audit or Tax Levy? 1. Health Savings Accounts. HSAs are one way to increase your net worth and beautify your bottom line, while giving less to Uncle Sam AND the health insurance company. Health Savings Accounts work best for healthy people. An HSA, combined with a high deductible health insurance, could save you thousands of dollars in insurance premiums each year. The IRS offers an annual tax credit of $3,850 for individuals (and $7,750 for families), which can be invested for tax-free gains. (This increases to $4,150 and $8,300, respectively, in 2024.) The tax benefit is available even if you don’t itemize deductions. To learn more, visit IRS.Gov and enter Health Savings Accounts in the search box. NOTE that opening a HSA with a brokerage should offer you more investment options than opening the account with an insurance company or bank. 2. IRA Contributions: You can still contribute to your IRA and receive credit for 2023, up until April 15, 2024. (Roth IRAs are not tax deductible.) Should you opt for a Roth, a traditional IRA or a SEP IRA? Most people earn more in their working years, when they can most benefit from the tax credit, and less in their retirement years, when they will have to pay income taxes on their traditional IRA (but not their Roth IRA). Peter Thiel reportedly has over $5 billion in his Roth IRA (source: ProPublica). If you are self-employed, consider a SEP-IRA, where you might be able to sock away $27,000 (50+) or $20,500 (under 50) each year. All of these IRAs offer tax-free gains. Self-directed IRAs offer more freedom of choice in your investments than 401Ks, RSPs, 529Bs, etc. So, rather than just maxing out your employer-offered retirement plan, it’s a good idea to contribute up to the employer match, and then consider maxing out your HSA and personal IRA. We discuss this in greater detail at our Financial Freedom Retreats. 3. Mortgage Interest Deduction. Mortgage interest paid on a qualified first and second home can be deducted. Click to read the IRS rules. This is a huge tax deduction that allows us to stop making the landlord rich, and pay less to the taxman. Home prices on a nationwide basis are at all-time highs and are largely unaffordable, so it’s not a great idea to just race out and purchase. (Over 20 million homes were foreclosed on before, during and after the Great Recession.) However, there are opportunities for smart buyers to rethink their housing and to vision and prepare, so that they can create a win-win-win for themselves when the opportunities arise again. These are some of the tools we teach in our Investor Educational Retreats. You can also read case studies in the Real Estate section of The ABCs of Money, 5th edition. 4. Student Loan Interest Deduction. If you earned less than $90,000 in MAGI (modified adjusted gross income) in 2023, and you paid on a student loan, you could deduct up to $2,500 of the interest you paid. 5. Qualified Education Expenses. You may be able to deduct education costs for yourself and/or a student in your immediate family. You may also be able to take an early distribution from an IRA without paying the early distribution penalty and additional taxes, if the withdrawal was made to cover a qualified education expense. And if the education is work-related, you may qualify for a Lifetime Learning Credit or a business deduction. 6. Energy Efficiency Credits. If you made energy-efficiency improvements to your home, you could qualify for up to $3,200 in tax credits. If you purchased an electric vehicle or installed solar or wind energy products, you could qualify for a generous tax credit. EV credits go up to $7,500 and wind/solar power products can be as high as 30 percent of the purchase price. The EV tax credit and the Residential Clean Energy Credit are both good through 2032. Certain rules apply to both, so be sure to visit the IRS pages and understand how to dot the I’s and cross the T’s. 7. Charitable Contributions. Your charitable contribution is tax deductible, provided it is made to a qualified 501c3. In addition to deducting your cash contributions, you generally can deduct the fair market value of any property you donate to qualified organizations. It is my experience that donating goods yields a better value in tax credits than you’d earn sitting all day through a yard sale. 8. Capital Gains. It’s important to do as much of our investing as possible in tax-protected retirement accounts. Doing so can eliminate capital gains taxes, which can be up to 37% for short-term capital gains. Did you know that you can even invest in real estate in your IRA? Email info@NataliePace.com to learn more. 9. Facing an Audit or Tax Levy? Hire an experienced, qualified accountant to review your case and communicate with the IRS on your behalf. As Wayne Layton, CPA, reminds us: "From time to time the IRS may suspect an error on a tax return or underpayment of tax and send my clients a letter assessing additional tax, along with penalties and interest. Most taxpayers become fearful upon receiving these letters as some of them even refer to liens and levies. Out of fear, many people just write a check to the IRS. As I see it, the letters from the IRS are simply telling the taxpayer to pay or prove why you do not owe the balance. There are many times that, on behalf of my clients, I write a letter disagreeing with the IRS’s position, attaching proof of why the taxpayer does not owe the additional tax, and the additional tax assessed is either reduced or the balance is adjusted to zero." Sometimes the IRS will agree with the accountant and adjust the balance due. Other times, if there is a good reason, the IRS may waive the penalties. And, of course, there may be times when you have to pay everything the IRS claims is owed. Most importantly, do not simply write the check before discussing your options with a qualified Certified Public Accountant. Bottom Line You don’t need to itemize deductions to take a tax credit. Many of the above tax benefits are available whether or not we itemize, and almost all of them offer additional savings in health premiums, capital gains taxes, utility costs, housing, gasoline and more. We can live a much richer life when we learn how to keep more of our money and stop making the taxman and billionaire corporations rich at our own expense. Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to invest and grow your wealth, green your retirement plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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 info@NataliePace.com to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register by Feb. 29, 2024 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 Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Celebrity Jet CO2. Green Washing. The Facts. Taylor Swift: The Average American Would Have to Live 600 Years to Match Her CO2 Emissions of 2022. How bad are commercial flights and cruise ships? Taylor Swift is in a league of her own these days, and it’s not just for being the only artist to win Album of the Year four times at the Grammys (congratulations on this monumental achievement), or because her Eras Tour is the highest-grossing music tour ever – surpassing a billion dollars in revenue (extraordinary). She is also being called out as the top CO2 emitter of all celebrities with private planes*. The emissions from her flight from Japan to Super Bowl Sunday on Feb. 11, 2024 were an estimated 40 tons of CO2. Total emissions from Swift’s private plane in 2022 were 9,293 tons (source: DGB Group), placing her at the top of celebrity plane polluters, followed by Floyd Mayweather, Jay-Z, A-Rod, Blake Shelton, Steven Spielberg, Kim Kardashian, Mark Wahlberg, Oprah Winfrey and Travis Scott – many of whom flew into Vegas for the Super Bowl. *Taylor Swift reportedly sold her Dassault Falcon 900 jet in January of 2024, after owning it since 2009. She allegedly purchases carbon offsets double the amount of her emissions. Offsets aren’t as effective as carbon drawdown and do nothing to actually remove the massive CO2 generated. Keep reading. Swift (and others) claim that their carbon credits offset their polluting ways. However, it’s quite important to note that the average American would have to live 600 years to contaminate the air as much as Taylor Swift did in just one year in 2022. It would take the average person living in France or the U.K. over 1,800 years to emit as much. (The U.S., Australia and Canada have 2-3 times the CO2 footprint of Europeans.) So, how bad is flying coach, especially compared to driving? What about cruise ships? See below for a graph of CO2 by transportation. As you can see, SUVs are worse on the environment than flying coach. CO2 by Transportation Private jets are in a horror league of their own, but cruise ships are terrible, as well. According to the Friends of the Earth analysis: One individual on a typical cruise ship emits roughly 421.43kg of CO² per day – more than double the emissions of most commercial flights. Alternatively, one individual staying in a high-end hotel, using carbon-heavy transportation and choosing higher carbon activities emits just 81.33 kg of CO² per day. The carbon footprint of an average land-based vacationer is around 51.88kg, less than one-eighth of the average cruisegoer. The lowest CO2 footprint is bike power. Followed by public transportation. In cities like Amsterdam, where bikes are everywhere, the denizens also enjoy greater health and far lower rates of obesity. Also, it bears repeating. Europeans often have a CO2 footprint of 5 or fewer tons per year per capita, while the Middle East, Australia, Canada, and the U.S. are 3X that. China is the biggest emitter by far, with 31% of the global CO2 emissions in 2020 (source: Union of Concerned Scientists). The greatest threat to our survivability on this beautiful planet is thinking that someone else will save things, while we continue on with business as usual. Celebrities are not immune from the effects of climate change. If we make excuses to keep our status quo, nothing improves. Let’s thank the scientists and environmental organizations for helping us to know better. Once we know better, it’s time to make the change. We can be the change we wish to see, and challenge leaders and famous folks to be accountable, too. While government leaders and celebrities may face a security risk if they fly coach, there are still many ways to substantially lower their CO2. There’s a massive difference between all and nothing. Additionally, if they have the resources for a private plane, they have the money to drawdown their emissions (not just “offset”). Below are just a few ways that all of us, including celebrities, can rethink our transportation CO2 footprint. Since transportation is the biggest CO2 emitter, reducing our personal footprint would be a game changer. We can also make smarter food, housing, electricity and consumption choices as well. Incidentally, green transportation is not just great for planetary health, but can also improve our physical and fiscal health. Did you know that most people spend more than $8000/annually on their personal vehicle, or that the dramatic rise in respiratory illnesses is directly linked to air pollution? Urban planner Brent Toderian consults with cities to eliminate congestion and reminds us that having too many cars on the road, even if they are electric, is an inefficient, gridlock transportation design. Making Smarter Transportation Choices: 6 Questions to Ask Ourselves Can I zoom instead of flying at least for the preparation stage of things? Can I plan my travel strategically, so I’m not zigzagging across the world? Is flying in a private plane necessary for my security, or am I using it as a party plane? Do I need a full-on bedroom in the sky, or will a cubby bed suffice? Can I downsize? Can the support team be incentivized to reduce their CO2 footprint? Instead of carbon offsets, should I invest in carbon drawdown, such as planting trees in a rainforest, donating to regenerative farming education, or sponsoring student gardens in public schools? And here is more color on each question… Can I zoom instead of flying at least for the preparation stage of things? Before the pandemic, I hosted our Financial Freedom Retreats in person. Occasionally, we’d have someone attending by videoconference, and it was always troublesome. That person typically felt isolated. Today, we host all of our initial retreats online, and save our in-person retreats for experienced individuals who have already attended the online training, and are ready to form deeper connections and partnerships. It’s actually easier for retreat attendees to see all of the power point presentations, to hear me up close and personal (as if I’m talking only to them), and to watch the training back to take the wisdom in more deeply. When everyone is on the same page, putting us all in the same location, in inspiring settings that offer experiential wisdom of what we’ve learned on paper, is far more powerful than taking people to a cool place and then sequestering them in a boardroom for 8+ hours each day. Can I plan my travel strategically, so I’m not zigzagging across the world? The Eras Tour coordinators, likely under the aegis of Taylor Swift, have planned the tour to minimize crisscrossing continents. She’ll be in Europe from early May through August. Swift might get a well-deserved break (writing/recording?) in September, followed by dates in the U.S. and Canada in October and November. If you have family on the opposite coast, rather than hopping back and forth multiple times throughout the year, can you take an extended visit once a year, dropping your travel CO2 by 2/3rds? Facetime and Zoom are great ways to stay connected in the interim. Is flying in a private plane necessary for my security, or am I using it as a party plane? This might be a fantasy scenario, but perhaps it will inspire creative thinking from some celebrities. Yes, it’s thrilling to attend the Super Bowl in person. However, if I’m also thinking of the future of my grandchildren, wouldn’t it be even more fun to sponsor a box where local underserved superstars attend the Super Bowl (perhaps inner-city high school athletes), while I host a party at home for my friends? Newscasters might love to feature the local students who get to experience the A-list treatment for the Big Game. Do I need a full-on bedroom in the sky, or will a cubby bed suffice? Can I downsize? The plane that Taylor Swift flew from Japan to the Super Bowl seats 17 passengers and has a master suite bedroom. Compare that to the first-class reclining seat, or the coach passenger leaning on strangers during snooze time. The larger the plane and the more weight (passengers, equipment or bedrooms), the more fuel is needed. On the flipside, The Prince and Princess of Wales (William and Catherine) took a commercial flight to France on September 9, 2023. In August, The Princess of Wales took Princess Charlotte and Prince Louis on an economy flight for their summer holiday in Balmoral. The couple have their Earth Shot Prize and are keenly aware of the message this sends with regard to their commitment to the environment. Can the support team be incentivized to reduce their CO2 footprint? When we place the planet at the top of our to-do list, our priorities and decisions become much easier. For high-profile celebrities, consulting an environmental expert on how to reduce their CO2 footprint by 30% annually would go a lot further in the public opinion and for the planet than purchasing carbon offsets, which do nothing to reduce CO2, or remove the pollutants from the damage they do. If the entire team is on board with the CO2 reduction plan, there can be even more incentives and rewards for the support team. Clif Bar offers employees up to $500 to purchase a commuter bike, if they agree to commute to work by bike at least twice a month, or use the bike frequently for local needs. Google’s GBike program offers bikes for getting around the headquarters’ campus, and loans bikes to employees who will use it at least 60% of the time to commute to work. “Treat the Earth like home” is one of the six principles of Dr. Bronner’s. Instead of carbon offsets, should I invest in carbon drawdown, such as planting trees in a rainforest, donating to regenerative farming education, or sponsoring student gardens in public schools? Nature is amazing. The waste of one animal or plant is the nutrition of another. We breathe and emit CO2. Plants and trees breathe that in, store it in the soil and give us clean food and air. In addition to reducing the CO2 footprint with smarter choices in all the ways that CO2 is emitted, why not complete the circle and draw down the CO2 emissions with charitable contributions to organizations that embrace nature’s remedies? Learn more about regenerative agriculture, student gardens, green tips, animal conservation and more in the Earth Gratitude docuseries (free) at https://earthgratitude.org. Bottom Line It’s easy to shrug and say, “Not my fault,” and continue doing what we do because what difference does it make while celebrities jet around to sports events and parties, while we bike with our backpacks to the grocery store. In that scenario, the ice caps keep melting. However, peer pressure is persuasive and facts are empowering. Social media can spark positive change. Call out the celebrities. Offer solutions. And take the challenge ourselves to reduce our own CO2 footprint. There is power in our consumer choices, and in our investing choices. Corporations can’t sell their gasoline, plastic, farm chemicals, celebrity jets, etc., if there is no one to buy them. We all need to make the connection between the source of our lifestyle, and our contribution to the problems. Celebrities have to realize that by partying in the sky, they are making the oil and gas companies rich and contributing to the environmental injustice of the communities affected by the fossil fuel industries – including the chemical spill in Palestine, Ohio, the Dead Zone in the Gulf of Mexico and Cancer Alley. When we think of our neighbors, or even the plight of fish, dolphins, whales and seafood, it's easier to do the right thing. Below are a few more blogs to take this conversation even deeper. 13 Lifestyle Choices to Reduce Waste, Pollution & CO2 and Save Thousands Annually. https://www.nataliepace.com/blog/september-18th-2023#/ 11-Point Green Checklist for Schools. https://www.nataliepace.com/blog/11-point-green-checklist-for-schools#/ ESG Investing: Missing the E (Environment) https://www.nataliepace.com/blog/the-dirty-truth-about-esg-investing-its-missing-the-e 10 Tips to Green Living https://www.nataliepace.com/blog/7-green-life-hacks#/ Cruise Ships Reward You For Investing. Is It Worth It? https://www.nataliepace.com/blog/cruise-ships-reward-you-for-investing-is-it-worth-it#/ Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn how to green your wealth plan, easy and efficacious nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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, which is a great way to start 2024! Email info@NataliePace.com to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register by Feb. 29, 2024 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 Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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. Watch videoconferences and webinars on Youtube. Other Blogs of Interest 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. Do Cybersecurity Risks Create Investor Opportunities? I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Copper. Essential to All Things Energy. Ways to Profit from a Copper Rally, While Protecting Ourselves from Volatility. Copper is a great conductor, and is essential to anything powered by electricity. This metal is fundamental to electric vehicles, electric transmission, solar, wind and construction. At the same time, economic headwinds can wreak havoc on demand – forcing a delay in planned projects. The solar industry is struggling. The wind industry has been stalled out by the high cost of financing projects, supply chain disruptions and inflation. Copper mining giants like Freeport-McMoran and Rio Tinto have seen their share prices drop by over -25% since the highs of early 2022. How will all of this affect copper prices, copper companies and the top-producing countries in 2024 and 2025? Here are the areas we’ll cover in this blog. Copper: The New Oil Prices Could Rise Over the Next 2 Years Companies Funds and Portfolio Diversification Bottom Line And here is more information on each point. Copper: The New Oil Copper has been dubbed the New Oil by Goldman Sachs because the metal is key to the clean energy revolution. Copper is a great conductor of electricity and is essential to everything from power lines to electric vehicles and batteries. However, when economies hit headwinds, copper demand plummets, as do prices. In recoveries, the essential metal can soar during the rebuilding and expansion phase. Prices Could Rise Over the Next 2 Years Demand is expected to remain stronger than supply can keep up this year, partly as a result of a planned closure at First Quantum's Cobre Panama mine. At the same time, weakening fundamentals for construction and the auto industry could temper the need for copper. As a result of these dynamics, many analysts have muted expectations for copper prices, though the consensus is that prices could rise by almost 10% by 2025. Prices are currently at $3.70/pound. Some analysts have forecasted that prices could rise as high as $6.72/pound by 2025. One of the biggest question marks is China. China has become the largest consumer and exporter of electric vehicles in the world, and is projected to have 4.2% GDP growth this year, as compared to just 1.6% or less in the U.S., Canada and Europe (source: IMF). The major copper mining companies have an Asian hub to address the largest market in the world. Companies Freeport-McMoran, Southern Copper, Rio Tinto, Anglo American and BHP Billiton are well-known mining companies with large reserves of copper. McEwen Copper is a microcap stock with a large reserve in Argentina that is being developed with funding from Rio Tinto and Stellantis, alongside one of the largest individual shareholders, Chairman and Chief Owner Rob McEwen. All of these companies will benefit from a rise in copper prices, and all have suffered as the price has pulled back from a high of $4.25/pound since January of 2023. Many of the companies are still sporting expensive price-earnings ratios – largely as increased costs have slashed profits. Freeport-McMoran saw their annual net profit plunge from $3.47 billion in 2022 to just $1.85 billion in 2023. If you’d like a Copper Stock Report Card, email info@NataliePace.com. Funds and Portfolio Diversification Chile is the #1 producer of copper, with Peru in the 2nd place position. One of the benefits of purchasing a fund in a copper-rich country is that you have a portfolio of companies, instead of betting the farm on just one. Owning a fund based out of Peru could also offer country diversification to our portfolios, while also benefitting from a copper rally. We’ve chosen Peru over Chile in our sample portfolios because Peru’s GDP growth in 2024 is expected to be much higher than Chile’s, at 2.7% vs. 1.6%, respectively. Chile’s copper mining is nationalized. Copper is the top export of Peru. A rally in prices will benefit the country. If prices sink, the country (and fund) will be negatively impacted. For this reason (and others), we’re suggesting a dollar-cost-averaging approach to adding an age-appropriate slice of a Peruvian fund (such as iShares’ EPU). An added benefit of a fund like EPU is that the dividend is 4.3% -- easily double that of most U.S. based value funds. You can learn more about our pie chart investing with annual rebalancing at our next online Spring Financial Freedom Retreat. Bottom Line The U.S. economy is expected to slow down in 2024, from 2.5% in 2023 to 1.5%. Inflation and high interest rates are impacting construction and EV sales (all car sales) in a negative way. While interest rates might be cut in 2024, the Fed Fund rate is still expected to remain elevated in the 4.6% range. So far, analysts are anticipating that constrained supply will keep copper prices buoyant – even rising by almost 10% by 2025. Of course, economies are dynamic, which is why it is always important to have an age-appropriate, diversified plan in place and to rebalance at least once a year. (Due to elevated equity prices, economic uncertainty and other risk factors this year, we're overweighting an additional 10-20% safe.) Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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, which is a great way to start 2024! Email info@NataliePace.com to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register by Feb. 29, 2024 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 Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Santa Rally 2023 or Time to Get Defensive? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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) The USA AAA Credit Rating is on a Negative Watch. Lithium. Essential to EV Life. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. 2023 Company of the Year Do Cybersecurity Risks Create Investor Opportunities? Writers Strike, While Streaming CEOs Rake In Hundreds of Millions Annually. I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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? Solar, EVs, Housing, HSAs -- the Highest-Yield in 2023? Why We Are Underweighting Banks and the Financial Industry. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Uh Oh. More Bank Trouble. Last February 10, 2023, we published a blog advising everybody that we were underweighting the financial industry. Little did we know that the first bank failure of 2023 was only a month away! Silicon Valley Bank was seized by the FDIC on March 10, 2023. That was followed very quickly by the failure of Signature Bank on March 12, 2023. First Republic Bank was rescued by JP Morgan on May 1, 2023. Since then, news about banks has been fairly quiet, although there have been two more failures, one in July and another on November 3. The bank that began having troubles last week is the same one that took over Signature Bank – New York Community Bank. Today, Moody's downgraded NYCB to junk. Here are a few things we’ll cover in this blog. New York Community Bank If You Wait for the Headlines, It’s Too Late Low Credit Quality in U.S. Banks Financial Engineering Our Own Checking, Savings & CDs The High Cost of Debt (More than Defense) Bottom Line And here is more information on each point. New York Community Bank On Wednesday, January 31, 2024, the New York Community Bank released their fourth quarter and full year 2023 earnings at 7 AM before the market opened. By the time the market did open two and ½ hours later, the bank’s share price had already lost a third of its value. What happened? If You Wait for the Headlines, It’s Too Late What were investors so worried about? One of the concerns was that the dividend was slashed from $0.17 a share in the third quarter to just five cents a share, so that the company could “build capital.” As we saw with General Electric in 2017 and countless other troubled companies since, the higher the dividend we are receiving, the higher the risk that we are taking on. If the dividend gets slashed, there is a gap down in the share price before most Main Street investors can react. NYCB closed with a share price of $10.38 on Jan. 30, 2024, and opened on Wall Street the following morning at $7.12. The current price is $4.20 – down almost -60% on the week. Rather than being cut on the wrong side of the blade (errr trade), it’s better to be protected before the trouble occurs. One way of protecting ourselves is to underweight U.S. financials in our wealth plan. Below are a few reasons why. Low Credit Quality in U.S. Banks We’ve also been warning about the commercial real estate industry. CRE and long-term bonds are two of the major challenges of banks today. WeWork declared bankruptcy on November 6, 2023, but there are many other CRE REITs in distress. As we indicated in our November 9, 2023 blog, the vacancy rate in office buildings remains heightened in a post-pandemic, work-from-home world. Some of the most vulnerable cities are experiencing vacancy rates that are higher than 20%. New York City is one of the areas in the throes of the CRE crisis, which is at the heart of the downgrade of New York Community Bank today. According to Moody’s, “NYCB's core historical commercial real estate lending, significant and unanticipated loss on its New York office and multifamily property could create potential confidence sensitivity.” A report last year by JP Morgan warned that small banks are the most vulnerable. CRE loans can make up 29% of assets in regional community institutions, compared with only 6.5% at the big banks. So, it’s important to underweight small cap U.S. financials, too. Commercial real estate isn’t the only bugaboo for banks. Because interest rates were so low for so long, and money was so cheap and easy, a lot of banks borrowed and borrowed and borrowed, and let their own credit rating drop to the lowest rung of investment grade. Below are the current ratings of some major U.S. banks. I’ve also included two Canadian banks, and one Australian bank. By comparison, Canadian and Australian banks tend to have more risk aversion than their U.S. counterparts. They fared a great deal better during the financial meltdown of the Great Recession than the U.S. and European banks did. Australia still has a AAA sovereign credit rating, whereas the U.S. and Canada are both AA+ (source: Fitch Ratings). In addition to higher credit quality, the Australian ETFs tend to pay higher dividends – often double what the U.S. and Canada pay in their value funds. Country diversification can add a layer of both protection and performance to our portfolio. It’s also important to remember that when the U.S. (or China) sneezes, the rest of the world catches a cold. Incidentally, First Citizens Bancshares, the company that purchased Silicon Valley Bank in receivership, is at the lowest rung of investment grade: BBB with a negative outlook (source: S&P Global). Financial Engineering Earnings reports in the financial industry can be quite misleading. The New York Community Bank and First Citizens Bancshares look like rock stars on the Bank Stock Report Card, with year-over-year revenue growth of 54% and over 100%, respectively – due to their acquisitions of the failed banks. (Email info@NataliePace.com with BANK STOCK REPORT CARD in the subject line, if you’d like a copy.) However, there is a great deal of financial engineering going on that helps the banks look better on earnings reports than might be the full story – something the dividend slash of The New York Community Bank reminds us of in spades. The bank failures didn’t stop last year because all of the risk went away. They stopped because the Federal Reserve set up a facility that allowed banks to borrow against their paper losses in long-term bonds, to gave them time to figure out how to raise more capital, diversify their assets and strengthen their balance sheets. The Bank Term Funding Program will stop making new loans on March 11, 2024. As one example of how financial engineering works, The New York Community Bank reported $2.3 billion in net income for 2023, compared to just $617 million in 2022. However, when you read the fine print, you see that the income wasn’t as exciting as we might think. $2.2 billion of the 2.3 billion net income was a one time “bargain purchase gain“ from the Signature Bank transaction. In fact, it wasn’t enough to keep the company from slashing their dividend. In the 4th quarter of last year, NYCB posted a net loss of -$260 million. Our Own Checking, Savings & CDs Bond and CRE exposure are challenges for the banks, but so are uninsured deposits. When uninsured depositors get wind of issues, they move quickly to protect their money. 85% of Silicon Valley Bank’s depositors were uninsured. The FDIC created a special exemption to cover those people. However, it wasn’t with immediate access to their cash. It was with “receivership certificates for the remaining amount of their uninsured funds.” The SVB exemption isn’t one that will be applied across the board. It’s important to do our best to observe federally insured limits in our personal checking, savings and Certificates of Deposit, and to lean into banks with higher credit quality. The High Cost of Debt (More than Defense) In my recent interview with Howard Silverblatt, the senior index analyst of the S&P 500, he predicted a 4-6% rise in the S&P500® in 2024. (The S&P500 is already up 3.9%. Will the rest of the year be volatile, but only slightly up, or will the market prove him wrong on the upside or downside?) While pre-election years can be gangbusters on Wall Street, election years tend to be pretty tepid. Sometimes they are horrifying, as they were in 2000 (the onset of the Dot Com Recession) and 2008 (the onset of the Great Recession). Silverblatt also noted that the interest being paid on the U.S. public debt, which is currently at $34.16 trillion, is costing too much. The CBO projects that net interest outlays this year are going to be 2.4% of GDP rising to 3.6% by 2033. Defense takes up about 3% of GDP. That puts pressure on the Federal Reserve Board to cut interest rates. Federal Reserve Board Jerome Powell has been firm about another pause in interest rates in the March 19-20, 2024 FOMC meeting (no rate cut). In his interview with 60 Minutes on Sunday, Powell stressed that policy would be driven by the data. In the December 2023 meeting, the FOMC projected that 2024 could see rate cuts that would bring the Fed Fund rate down to 4.6%, from 5.25-5.50% where is stands today. The economic projections will be updated on March 20, 2024. While rate cuts are predicted, 4.6% is still much higher than interest rates have been over the last 15+ years. It will still be hard for a lot of potential home buyers to qualify for loans or afford housing at current prices. Corporations that need to raise capital will still be paying a lot more in interest. The potential rate cuts will not be enough to recover the massive losses that long-term government bonds saw in 2022, or to offset the continued problem of duration risk and low credit quality. Bottom Line Economists are still holding out hope that there will be no recession in 2024, or that if there is one, it will be quite brief and mild. Main Street investors are still high on the headlines of 26.3% gains in the S&P 500 for 2023. (How many are aware that without the Magnificent 7 doubling in value, the gains would have been half that, or that 1/3 of the Dow Jones Industrial Average companies actually saw their share price fall last year?) There continues to be a lot of risk on Wall Street today, including debt, bank trouble, elevated share prices, low credit quality, bond losses and duration risk, which is why we are overweighting safe in our sample pie charts. In a Debt World where banks are still failing and reeling from bond losses (on paper), we are also stressing that everyone needs to know what they hold on the safe side of their plan. We spend one full day on What’s Safe at our Financial Freedom Retreats. With the amount of exposure that regional banks have to the distressed CRE market, we might start seeing a lot more dividend cuts and gap downs in share price. The FDIC, Federal Reserve Board and Treasury Department are all putting pressure on banks to shore up their reserves. In our sample pie charts, we continue to underweight financials of all sizes. As we indicated, the risk is even more heightened in small and mid-cap regional banks. Since a lot of the U.S. value funds have a great deal of financials in them, it’s a great idea to consider value substitution funds and leaning into country diversification, where we can often get a higher yield with lower risk. This is actually pretty easy to self-direct once you learn our pie chart system. Even if you have someone managing your plan, it’s important to know what you own and why, and to be the boss of your money. Join us at our next Spring Financial Freedom Retreat April 27-29, 2024. Get the best price when you register by February 29, 2024. Friends and family can join you for a great discount! Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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, which is a great way to start 2024! Email info@NataliePace.com to register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register by Feb. 29, 2024 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 Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by April 30, 2024 to receive $200 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Santa Rally 2023 or Time to Get Defensive? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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) The USA AAA Credit Rating is on a Negative Watch. Lithium. Essential to EV Life. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. 2023 Company of the Year Do Cybersecurity Risks Create Investor Opportunities? Writers Strike, While Streaming CEOs Rake In Hundreds of Millions Annually. I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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? Solar, EVs, Housing, HSAs -- the Highest-Yield in 2023? Why We Are Underweighting Banks and the Financial Industry. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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. Are Weebly, Amazon and Other Tech Companies Ripping Us Off? Tips, upsells, unauthorized charges and renewals. More than just annoying and time consuming. Shady math can portend economic storms and plunging stock market prices. Tips I can understand, tipping my hairdresser, who just spent two hours on highlights, or my housekeeper, who did the same on cleaning. However, do we have to tip someone who puts a scone in a box? Norms around tips are changing. However, that has a lot more to do with underpaid staff than interstellar service. There are a lot of guides out there about what might be an appropriate way to tip in the 21st Century. This article is more about what the tips say about what the company and our economy at large. Upsells Does the upsell, which everyone is trained to do, reveal smart business practices or underlying economic weakness? Are companies actually ripping us off by forcing us into new, more expensive subscriptions? Are Weebly, Amazon and Other Tech Companies Ripping Us Off? I’ve recently come across a few very troubling incidents personally. After perusing Reddit and asking around, it seems that these weren’t isolated bad luck on my part. Amazon Amazon withdrew money from my personal checking account without permission, without notifying me, charging me hundreds of dollars over a few years. The company was double-billing me for my Amazon prime account. They gave me no credible explanation about why they did this, though they did promptly refund the charges, once I discovered them and complained. When I went to my bank to stop Amazon‘s ability to withdraw money from my checking account ever again, the bank representative who assisted me told me he gets multiple complaints every day about Amazon. I was appalled to learn from the bank that Amazon was indeed withdrawing directly from my checking account, even though they told me that they were using a debit card (which wasn’t even in my card history). When I asked for the card number or even the last four digits to investigate things, Amazon refused to give me that information. Amazon had my bank information because they are supposed to deposit my earnings from book sales. It took multiple calls with multiple customer service representatives before I finally got through to a supervisor. Once I did, the reimbursements happened immediately – with credits going out to multiple credit cards (which hadn’t even been charged on). I wasn’t going to argue that point. However, finding support on Amazon is like traversing a medieval maze, and how many people would make it through six daft gatekeepers to finally arrive in the hands of someone who can actually do something? If you’ve experienced unauthorized charges on Amazon or had a similar experience, please share and tag me on Instagram.com/NatalieWynnePace, and email info@NataliePace.com. Weebly A few days ago, I received an email from Square (Block Inc.) that my Weebly website renewal was going to be automatically transferred to the most expensive business account, tripling my annual cost. I underscore that this was going to be done automatically, unless I took action first to prevent it from happening. I can only wonder how many people might’ve missed that email and then had to fight with the company afterwards! What was even more distressing was that the email indicated that my current features were only going to be available at this much higher price. However, when I looked at the actual plans themselves, there was an option that featured the exact things that I use for the exact same price. I got on a chat with a Weebly customer service representative. It took about 45 minutes to resolve the matter and renew – and prevent the highway robbery that was rolling down the bend if I didn’t. When I asked the customer service representative why I had received an email saying that Weebly was going to almost triple my price automatically without my authorization, he said that they always want to offer the best plan. In other words, they’re taught to upsell… except in this case, it wasn’t an upsell. I wasn’t being offered anything. It was going to happen automatically, without my authorization. If you’ve experienced unauthorized charges on Weebly or had a similar unpleasant experience with another company, please share and tag me on Instagram.com/NatalieWynnePace, and email info@NataliePace.com. Cooking the Books This kind of deceptive business practice is rather unusual, except in certain periods of time – when a company is struggling to look good for their quarterly earnings reports. Weakening economic conditions create an environment when some executives aggressively, brazenly, step over the line of business ethics. A confluence of shady math often precedes a pretty steep recession, which brings me to another experience I had before the Dot Com Recession, when Global Crossing, Worldcom, Lucent and a slew of other telecommunications companies failed. Back in 2001, I was working as the vice president of operations for a long-distance telephone company. The company was buying wholesale from one of the major, publicly-traded telecom companies. One day, I overheard a very heated conversation between the boss of our company and his wholesale representative. Our head honcho was screaming into the phone: “You’re cooking the books!” What was happening? The younger generation might not remember a time when calls weren’t free. However, back in 2000, long-distance rates dropped from $.25 a minute or higher to under 10 cents a minute. We were purchasing wholesale for about four cents a minute, and then selling to our customers for under $.10 a minute. The telecommunications industry, largely because of Skype and VOIP disruption, was experiencing a troubling contraction in pricing. A lot of telecom companies were really in trouble – yet they were still the hottest stocks on Wall Street, (with analyst buy recommendations). Our provider was charging us at the old wholesale rates, which were four times the contracted rate. For months they had never changed the price to what was contracted, or credited the invoice to reflect the proper amount due. The rep just kept telling us that everything was getting done. The company was just backlogged. Don’t worry. Thanks to that knowledge, when I met with a financial advisor who was trying to convince me to invest in telecom stocks back in August 2000, I declined. That decision to avoid the overpriced marketplace, where sadly there were a lot of companies cooking the books, led me to the career I have today of adding a splash of green to Wall Street, and transforming lives on Main Street. If I had let the CFP do what he wanted to do with my money, something many other Main Street investors were doing, I would have ridden the Wall Street rollercoaster down to losses of -78% or more. (Many of the telecoms went completely out of business.) Shady Math Can Get Past the Auditors The ethically challenged actions I’ve outlined above might make it past the auditors of the earnings reports. Amazon’s auditors have no idea that the company just credited me hundreds of dollars in unauthorized double billing or that Weebly’s little revenue bump trick didn’t work. They won’t catch either tactic until an eyesore of refunds has to be declared on the balance sheet. Uber/Lyft I didn’t experience any grift from Uber and Lyft. However, I’m including these companies because there were a great deal of cash-negative “New Economy” companies that crashed and burned in the Dot Com Recession. Uber, Lyft and other ride-share, food delivery and micro mobility companies are cash-burn companies that have struggled for years to become profitable. Some have been taken private (GrubHub). Others are in bankruptcy (Bird). Both Uber and Lyft have been cash negative since inception (2009), with the only exception being 2018, when Uber managed to turn a profit of $997 million. Customers always experience the fallout of a failing or struggling company before the final blow. Companies like Bird can continue operating during their debt restructuring. However, the stock almost always goes to zero. So, with Uber trading at an all-time high, even though the company lost another $9 billion last year, now might be a good time to factor in your customer experience into your trading due diligence. Trying to hail a rideshare can be pretty challenging these days. If you ask your rideshare driver how they like their company, you might get an earful of complaints that won’t end until you arrive at your destination. Each time I try using the app, I might have to wait 10-15 minutes in the hopes of finding a driver near me, only to be advised that there isn’t anyone in my area (though the map of drivers tells a different story). This has become such a problem that I’ve taken to sleeping in airport hotels to avoid the worry. One study by MIT in 2018 claimed that rideshare drivers make less than $4/hour, once you factor in their costs. Can tips bring drivers above the poverty line? Isn’t that why we’re expected to tip everyone these days in the U.S.? (This is not the case in other countries. U.K. rideshare drivers must receive minimum wage, holiday pay and a pension.) Ride-share companies aren’t getting rich on their business model. The last time we had a spate of cash negative speculative stocks and a flashy story (“The New Economy”) about why that was okay, Dot Com stocks crashed by -78% and took 15 years to crawl back to even. If you’d like an Uber Stock Report Card, email info@NataliePace.com. Banks. Term Loans for Their Toxic Bonds Ends on March 11, 2024. I’m going to address why the bank failures were largely curtailed last Spring, and why many finance companies will be tested this year in an upcoming blog. In the meantime, we continue to underweight financials in our Investor Educational Retreats and sample pie charts. Bottom Line I am giving you specific examples of a very personal nature because if you are experiencing things of this kind: · We want to warn one another and protect our friends and other consumers · We want to protect our investments and retirement plans When questionable actions of this nature become rampant, companies are trying to keep their earnings reports looking strong, so their stock prices remain high. They cannot do that forever. At some point, their customers revolt, the class action lawyers have a field day, the auditors dig deeper, the rating agencies review their credit, the analyst recommendations do an about-face and the gap-down in share prices can happen before we can protect ourselves. It’s always a better plan to fix the roof while the sun is still shining. Stocks keep hitting new highs. A properly diversified plan with regular rebalancing allows us to participate in the profits, while protecting ourselves from the shenanigans and inevitable fallout. Join us at our April 27-29, 2024 Spring Financial Freedom Retreat. Learn nest egg strategies, how to get hot and diversified (including in artificial intelligence), and 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, which is a great way to start 2024! Email info@NataliePace.com 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 Join us for our Online Spring Financial Freedom Retreat. April 27-29, 2024. Email info@NataliePace.com or call 310-430-2397 to learn more. Register by Jan. 31, 2024 to receive the best price and a 50-minute complimentary private, prosperity coaching session (value $400). Click for testimonials, pricing, hours & details. Join us for our Restormel Royal Immersive Adventure Retreat. March 7-14, 2025. Email info@NataliePace.com to learn more. Register by Jan. 31, 2024 to receive $500 off the regular price. Click for testimonials, pricing, hours & details. There is very limited availability, and you must register early to ensure that you get the exact room you want. 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! 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 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. Holiday Gift Giving on any Budget. Including No Budget. Once in a Century Events are Happening Every Day. The Crypto Winter Enters Its 3rd Year. Earn $50,000 or More in Interest. Safely. Finally. Freebies and Deals for Black Friday and Cyber Monday. Auto Strikes End. EV Price Wars Continue. 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 Air B N Bust? Santa Rally 2023 or Time to Get Defensive? Barbie. Oppenheimer. Strikes. Streaming Wars. Netflix. Monero: A Token of Trust? 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) The USA AAA Credit Rating is on a Negative Watch. Lithium. Essential to EV Life. I'm Just Not Good at Investing. Investors Ask Natalie. Should I Buy an S&P500 Index Fund? Investors Ask Natalie. Bonds Lost More than Stocks in 2022. 2023 Company of the Year Do Cybersecurity Risks Create Investor Opportunities? Writers Strike, While Streaming CEOs Rake In Hundreds of Millions Annually. I Lost $100,000. Investors Ask Natalie. Artificial Intelligence Report. Micron Banned in China. Intel Slashes Dividend. Buffett Loses $23 Billion. Branson's Virgin Orbit Declares Bankruptcy. Insurance Company Risks. Schwab Loses $41 Billion in Cash Deposits. Fiat. Crypto. Gold. BRICS. Real Estate. Alternative Investments. BRICS Currency. Will the Dollar Become Extinct? The Online Global Earth Gratitude Celebration 7 Green Life Hacks Fossil Fuels Touch Every Part of Our Lives 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? Solar, EVs, Housing, HSAs -- the Highest-Yield in 2023? Why We Are Underweighting Banks and the Financial Industry. 2023 Bond Strategy Emotions are Not Your Friend in Investing Bonds Lost -26%, Silver Held Strong. 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. Rebalancing Your Nest Egg IQ Test. Answers to the Rebalancing Your Nest Egg IQ Test. 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
March 2024
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