Announcer:
4 Your Money is brought to you by NelsonCorp Wealth Management.
Brandy Auterson-Hurst:
It’s now time for 4 Your Money. We’re joined by David Nelson, CEO of NelsonCorp Wealth Management. Welcome back, David.
David Nelson:
Thanks, Brandy. Appreciate it.
Brandy Auterson-Hurst:
So we’ve heard a lot about the Federal Reserve and its interest rate policies lately. What can you tell us about how Central Bank actions impact markets?
David Nelson:
I think there’s a lot of excitement out there. There’s a term being thrown around again called, “Don’t Fight the Fed.” And that basically in simple terminology means that when they’re cutting rates, that’s historically pretty good as far as markets are concerned. But I brought along a chart today that gives folks a visual of the importance of not just the Federal Reserve, but the global landscape and what it’s looking at here, and this is a beautiful chart. If you look at the blue line here, it’s basically when we’ve got over 50% of the Feds around the world that are cutting interest rates with the market, basically how it’s performed during that period.
The red on the other hand is when interest rates are being raised as far as over 50% of, again, the global Federal Reserves around the globe. So it’s an interesting chart illustrating, I think a really important point to individuals that this is a period of time that probably there’s a fair amount of good news that’s being priced in. Again, just be cautious, be careful as always.
Brandy Auterson-Hurst:
Yeah. So what does this mean for investors today?
David Nelson:
Well, I think we’re in the early stages. Clearly as far as interest rates being cut, historically, that’s been really, really good news as far as, again, for investors. But again, we’re always cautious as far as when people get too excited, markets overreact, and sometimes we can find ourselves at the wrong end of the spectrum as far as losing money in that environment. So be careful.
Brandy Auterson-Hurst:
All right, some good tips there, David. As always, thanks for joining us.
David Nelson:
Thank you.
Brandy Auterson-Hurst:
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This video includes a paid appearance.