Announcer:
It’s time now on KROS for Financial Focus, brought to you by NelsonCorp Wealth Management. The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. Any indices mentioned are unmanaged and cannot be invested into directly. Registered representative, securities offered through Cambridge Investment Research Incorporated, a broker-dealer, member of FINRA, SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors Incorporated. A registered investment advisor, Cambridge and NelsonCorp Wealth Management are not affiliated. Cambridge does not offer tax advice. Now here’s today’s Financial Focus program.
Gary Determan:
Well, it is the first Wednesday, so a pleasure to have Dave Nelson in studio with us. Dave, I know you guys are wrapping up your toy and food thing. It looks like it’s gone pretty well when I walk over there.
David Nelson:
Holy buckets. Last night, so each year we do a Christmas party and last night was one. We had about 400 people as far as there that came out and braved the cold. And the other one is tonight. So we’ve got two of them that we’re up to now that we’re doing. Tonight will be roughly 400 people as well. And I don’t think we’ve ever had levels like we’re having now. We had one lady walk in yesterday, and I’m not kidding you, with six boxes of toys. And I just prodded her a little bit without trying to be too nosy, but over $700 herself. So I said it’s just amazing as far as the individuals out there that, again, been, I guess we’ve had a really good year as far as across the board from an investing perspective. I think people are feeling, liking to look at the account balances and feeling more like maybe we should be giving a little bit additional back.
So the numbers last night were off the charts as far as the food, as far as the toys. So this morning, several people as far as from the office were the delivery people now, taking the items out. And tonight’s going to be a cold one as far as out there. I’m not looking forward to it, standing outdoors for about three hours collecting and putting stuff in, but it’s great. And again, we’re very lucky. We got great clients, got great people as far as that work for us that really care about others, other than themself and it showed last night and it’ll show again tonight.
Gary Determan:
It is amazing. We’ve been doing this for a number of years. I’ve known you for a long, long time.
David Nelson:
Sure, sure.
Gary Determan:
I remember you from your days at Eagle. So I’ve known you for some time in the family for some time.
David Nelson:
Sure.
Gary Determan:
But the growth of your NelsonCorp is just, it’s amazing. From where you started to, the people that you have now.
David Nelson:
Yes. And we’re in the midst of, we’ve identified three people that we’re hiring, so we’re adding three additional people as far as locally here. One will be more on the accounting side as far as helping there. That’s grown significantly and the two will be on the wealth management side. So yeah, I’ve probably shared on here previously, leaving a job in 1981, making $22,000 a year with benefits to, two years later, it was 6,000 was my gross income two years later. Didn’t look like a good decision at that point in time. And fortunately I hung in there and kept pushing forward and things have worked out. But we’re in a really unique community and the people around, if you take care of them, they take care of you. And the amount of word of mouth, I mean, obviously we do the radio program here. It’s one of our ways of communicating with clients on a more regular basis, what have you.
But in addition to that, just that the … I’ve said for years, people are going to yap. This is one of the things around the office that we talk about. They’re going to yap. So they’re either going to say really good things about us or they’re going to say really bad things about us. And so when they tell somebody something good, they’re going to tell two people. The statistics back this up. And if there’s something bad, they’re going to tell eight to 10 different individuals as far as that. So we got to make darn sure that it’s a real positive comment.
So again, we’re probably overstaffing short-term, adding three additional people as far as to the office. But it’s important that the quality of the product that they basically are getting from us as far as whether it be, again, accounting, whether it be as far as the wealth management side, whether it be Medicare now, as far as that additional service, we’ve got to make sure that we know what we’re doing and we’ve got to make sure that we have the people there to support it on an ongoing basis. It’s one thing to create a relationship with somebody and tell them that you’re going to do certain things. It’s another thing to be able to follow through with it. That’s been a challenge for us because of the tremendous growth that we’ve had. We’ve been very, very lucky as far as that regard.
Gary Determan:
So the quarterly newsletter that Mary and I get, you’re going to have to expand the page and [inaudible 00:05:13] pictures are on?
David Nelson:
Exactly. Yeah. I don’t know what it is now, but it’s roughly 20. We’re going to roughly 25. So yeah, there’s going to have to be smaller photos, I think, or I don’t know. The smart people take care of that at the office. But yeah, it’s terrific. And we had the quality of the help that the people that we’re interviewing has been off the charts. We’ve just got really, really good, talented people. And ironically, they’re not all from Clinton. Two of the individuals, one lives in Morrison, one lives in [inaudible 00:05:48], and I’m trying to remember. The other, I think, is from Clinton. So we’ll have people coming from multiple directions. So we’re excited about that. And again, the Davenport office continues to grow and we have good support down there. We’ve got one of the folks from town here that’s now working down there on a daily basis. So yeah, things are good as far as in that regard and markets have cooperated. So life’s pretty good.
Gary Determan:
Two different markets, I mean, Clinton and Davenport, do you do the same level of giving down at Davenport, David?
David Nelson:
Not yet, just simply because of the headcount. We pretty much try our best to match as far as where the … basically the gifts are coming from, whether it be financial. Last night we had multiple people bring in cash. We had multiple people bring in checks. So we tried to basically send that stuff as far as to where it came from, back to that particular area. Fulton’s a good example. Fulton, the food bank over there, I think they get roughly a third of what we collect. We’ve got a lot of people from Fulton. We’ve got a lot of people from Morrison as far as that are clients, and the surrounding area. Mount Carroll, unbelievable number that we have as far as from up there. So the Fulton Food Bank supports a lot of that. And so we support them each and every year.
And actually last night, it was interesting having multiple people that work there. They’re volunteers as far as there that were there last night and trying to coordinate plans as far as for delivering the goodies as far as to them. So yeah, I think through time it’ll grow because the operation down there, I mean, we used to have a little storefront. Now we’ve got a pretty substantial office building and headcount and whatever down there. And because of that, we now have a lot more clients as far as down there. And so the ongoing will continue to grow down there. We’ve got a little party planned down there. This will be the first Christmas party that we’ve done in the Quad Cities. So this will be a, that’s in, I don’t know, I think it’s next week, just a lot of gatherings.
Gary Determan:
Somebody will tell you.
David Nelson:
Yeah, exactly.
Gary Determan:
Somebody will let you know.
David Nelson:
I’ll show up. Yes.
Gary Determan:
I could see where you would be, have that presence in Fulton, Morrison, and you mentioned Mount Carroll, because you got your start over there in Fulton, with your father-in-law.
David Nelson:
We did, exactly. And subsequently, Freeport is another town that we have a lot of people in. In the early days, he, my father-in-law, had a whole bunch of clients and whatever, and he got a cluster as far as up in the Freeport area. And so that one grew from maybe 20 at that point in time to probably now 40 or 50 as far as that area. So yeah, it’s a nice presence over there. And again, for those that don’t know, we worked out of a basement, his basement, for a year or two. Then we moved out to the old Sigma Furniture. So those that have a few years on them, like me, remember that particular location.
We were the first one in that, what would be called a mall. And we spent a year or two there. Then we moved downtown. Now I think it’s a chiropractor that’s in that office, if I’m not mistaken. It was across from the Fulton Bakery back then, and we were there three, four years. Then we moved to the north end of Clinton and had our own building that we owned. That was the first one, up by the funeral home and Corvin’s, I guess I would say half a block away. And then where we’re located now, and we’ve been there since … probably about 25 years, I think, give or take.
Gary Determan:
I think it’s on the building.
David Nelson:
Yeah, it is. It is. And you’d think I could remember it? I can’t.
Gary Determan:
Yeah. You walk by it. I would imagine it’s almost generational now, you guys been doing this. I mean, you’re getting the children of people you started out with.
David Nelson:
Very much so. It’s fascinating as far as from that standpoint, as far as just talking to the next generation as far as … and then they referenced mom and dad. And I’ve got one that comes to mind as far as these people, and it isn’t local. This one started, this individual tracked me down. He did a scan back when you had the old floppy discs and it was a program through Microsoft that basically had all the data as far as financial people around the country. And they did a scan as far as what they’re looking for, what they thought they needed. They came up with a person in Florida and myself were the only two. So they floated through town, gave me all their stuff, said, “We’ll be back in six months.” They’re doing a hiatus as far as from work. He was in the construction business.
And anyway, turned into a great relationship, still working with them. They now live in Utah. They lived in their mobile home, I guess. I got to get the right term, and travel around the country and just set up shop. And just a fascinating couple. I don’t think I could do what they did, but they love hiking. They love the outdoors and they’re now both in their 80s and still continue. I mean, you look at this guy, he’s just cut and just looks great. She looks great. But anyway, their kids are now scattered all over the country and we’re working with them. And it’s just been interesting and listening to them tell stories about mom and dad years ago, when I didn’t know them. So yeah, good stuff. And again, if you take care of people, again, they chat and will tell their friends, family, and subsequently, you create new relationships.
Gary Determan:
Before we break for the weather, just listening to you talk about that couple and their children, you probably have so many great stories of people that you work with who have been so successful.
David Nelson:
Yes. And the one that comes to mind right now and most recent, and this came, again, via a referral. There’s a billionaire that lives out in Wyoming. He’s got a place in Wyoming, California, and then one in Iowa. But again, we took care of people that he knew quite well, four, five, six people. I’m going to say it’s probably six as far as the headcount. I’ll do it quick here. But the bottom line is took care of them. Now this guy picks up the phone one day and calls and says, “I’d like to talk to you about my stuff.” And I almost passed out. I thought it was some scam artist, whatever.
Gary Determan:
My stuff.
David Nelson:
Yeah, exactly.
Gary Determan:
But all my stuff is money.
David Nelson:
Yes, exactly.
Gary Determan:
Amazing.
David Nelson:
And, “I don’t need all these services. I just need this one thing here,” more or less handle some of the investments. And that’s turned into, “Well, I didn’t think I needed help here, but I do,” and then somewhere else. So yeah, we’ve got a great team down there, really smart people and it’s showing up as far as in that relationship.
Gary Determan:
All right. After the weather, talk about 2025 and maybe look ahead to ’26.
David Nelson:
Perfect.
Gary Determan:
All right. Our weather update brought to you by Morrison Community Hospital.
Announcer:
Slightly warmer temperatures, but still a very cloudy day on tap for your Wednesday. We’re actually going to see temperatures near the freezing mark by this afternoon and a few flurries will be possible as well. Skies quickly clear tonight, though. And with a northwest breeze, we’re going to fall to about three below zero, with wind chills of 15 below. With your Storm Track 8 weather impact forecast, I’m meteorologist, Andrew Stutzke.
Gary Determan:
Right now overcast skies, 31 degrees with those Southwest winds. Our update brought to you by Morrison Community Hospital.
Announcer:
Your friends at Morrison Community Hospital wish you a happy and safe holiday season. Please search their website, morrisonhospital.com, for new providers and services and a big announcement coming in 2026. They also want to remind you that the Family Care Clinic and the specialty clinic will be closing at noon, Wednesday, December 24th, and they will remain closed on Thursday, December 25th. The clinic will also close at three on Wednesday, December 31st and will be closed on New Year’s Day. Emergency services will still be available. Happy holidays from Morrison Community Hospital.
Gary Determan:
First Wednesday of the month, so we get to continue to the bottom of the hour with Dave Nelson. Well, we’re wrapping up 2025 overview of the year.
David Nelson:
Yeah. I mean, if you step back and just you fell asleep for the year and you look at the net worth statement today as far as if you were invested in stocks, the index, which is a fancy way of saying that the S&P 500 is probably the best proxy as far as to look. You’re up 15% each, give or take. And so it’s been a really, really good year from that standpoint. You look at other areas and, hey, I like to buy, let’s say a person is very much into value stocks and things of that nature and value stocks, a broad term for stocks that have been roughed up. Let’s say they were more expensive a year or two ago and now people tried to do a little bottom fishing and trying to pick up some bargains. As a whole, that group has underperformed the 15% by quite a bit. They haven’t performed that well.
On the other hand, if you look at the winners the last several years, which primarily focus in technology, you keep thinking that at some point here, that’s going to underperform. Well, in 2025, it hasn’t. It outperformed the market as a whole, not by the margins like it has last several years, but it’s been a pretty good year. So all the big name technology type companies as a whole had a pretty good year. Bond market strangely had a pretty good year as well. If you had what’s called the ag bond, which is a fancy way of saying, again, if you had long-term bonds and an intermediate bonds and you had short term bonds in this cluster and you bought into that, there’s an index that basically will allow you to do that. That’s up six, 7% as far as year to date.
So again, a pretty darn good year when you consider that you’re talking about bonds. The big winner basically centered around, and I got to be careful on how I word this, but is this thing that people look to as far as a safety net, as far as something that you make rings out of. That particular area of the market absolutely exploded for the year. That’s up north of 20% as far as for the year. And many people believe that there’s still more to come. So it’s been interesting, again, from the standpoint of international has also had a okay year depending on, again, what type of international we’re talking about. Emerging markets. If you were in more a concentrated portfolio, say Africa, you’re up 50%, literally.
If you had Europe, Europe probably in the neighborhood of 20% as far as year to date. If you’re in a more diversified mix, obviously you blend some of that stuff together. You’re anywheres from probably 15% to 25%. So it’s been a pretty interesting year. We are obviously always looking out as far as for trying to protect capital. We want to grow it, but we also don’t want to lose it. And so the bottom line is we’ve been a little nervous the last 30, 40 days and things seem to be clearing out a little bit as far as from that standpoint.
A couple of the models that we look at are more favorable today, let’s say, than they were 45 days ago. So again, I wouldn’t get crazy, folks, as far as out there, but generally speaking, right now there’s a fair amount of things that seem to be okay. Inflation was a big scare for a while. Continues to be one of those things that could happen, but does it look like, in the short-term, it’s going to happen. Recession has been thrown out there a lot. Again, depending on the definition, a year, year and a half ago, many people believe we had a mini recession, but again, we’ve recovered pretty nicely as far as from that. So don’t do anything crazy, but things, generally speaking, look okay today.
Gary Determan:
It’s always interested to me that people can talk about how well the market is doing, but the economy is not doing that well.
David Nelson:
Yes.
Gary Determan:
And you would think the two would mesh.
David Nelson:
Yes. And what the markets have a tendency to do is they’re basically trying to anticipate what’s going to happen. Not what currently is happening, but what’s going to happen. And the timeline that most people throw out there, and I think that’s changed. From the beginning of my career, that was six to nine months. I think it’s more like years, now that people are looking out. I mean, when you look at the investments that are being made in AI, so if people don’t know what that is, it’s artificial intelligence. It’s this stuff that scares many people and the stuff that excites some individuals out there. But the money that’s being spent as far as by these big technology companies in that arena, basically, to date, they haven’t really seen any return to speak of. And so the question is, are they going to see as far as a return on that?
And so now is this going to be a massive bubble like we had in the year 2000 with the internet as far as back in the day. If we can go back that many years, if you look at ’07, ’08, ’09, we had another bubble as far as that took place there. Many companies that basically existed back then don’t exist today. That’s interesting when we look at, I saw a piece the other day as far as, and it went back to the, I think, the ’60s and the largest airlines. I can’t, Pan American, and then I forget. There’s two of the jumbos. They don’t even exist today. So it is a rapidly changing world. And at the end of the day, again, when we look at it, we’re saying with some thought put into it, you need to diversify, but just throwing your money randomly into all these different places probably doesn’t make sense.
What we try to do is to focus on stuff that has the best probability of making people money. The example is, again, this year, and I know I talk about this a lot, but by shrinking the losses, you can actually increase the gains pretty dramatically. And when we look at this year, I mentioned as far as the market, what it has done year to date, we’ve actually beat that by a pretty significant margin. So we’re thrilled about that, hoping that we can do that again next year, but all of that came from avoiding the big hit early in the year. We were able to step to the sidelines and I want to be careful on the term again. We didn’t avoid all of it. We avoided a lot of the damage. And subsequently today, we’re standing at really, really nice returns year-to-date, and we didn’t have to take as much risk as the market would have demanded if a person just put it in, fell asleep, and hoped that things worked out.
So yeah, it’s fascinating. I think AI is probably, looking at 2026, is going to be one of the big question marks. Do you have the guts as far as today? “Hey, I have a few extra bucks I want to do something with, and somebody told me that this AI investment arena should be a good place to put some money.” I don’t know if that’s the case or not. I don’t know if the big opportunity has been missed. And oftentimes, when you have a run-up like we’ve seen as far as in that space, you’re going to have winners and you’re going to have losers. And there’s going to be many losers that will not be in business, say two, three, four, five years from now, and you want to avoid those. So again, it’s probably something that you want to, again, take a peek at some of the stuff that hasn’t done as well, I guess is the long and short of it. And AI certainly has been one of the big winners.
Gary Determan:
Don’t want to throw you a curveball, but something that just-
David Nelson:
Go for it.
Gary Determan:
Occurs to me, mergers and buyouts.
David Nelson:
Yes.
Gary Determan:
How much does that play into a market decision?
David Nelson:
Yeah, it does because, again, you have the big companies that have been gobbling up. Once you get to a certain size, it’s tough to keep growing even close to that same pace. So what companies oftentimes will do is they’ll try to find the next company that’s like themself that’s in the early stages and they gobble them up and pay an enormous premium. So we’ve seen a couple of them just in the last probably month and you’re looking at 30 and 40% premiums that these companies oftentimes are selling for, sometimes even greater than that. So again, a fancy way of saying, “The stock’s trading at $10 and we’re going to pay you $13 and we’re going to take the whole company from you. We want to buy it out,” or, “We’re going to pay you $16,” or whatever the case may be.
And so when they do that, again, the hope and the expectation is that they’re going to see some of that growth. IBM is a good example. And again, I’m not recommending any of these. I qualify that, so got to be real careful. But they basically went out several years ago. And again, go back 30 years ago. They were the big horse out there. I mean, IBM was the envy of the world as far as, I mean, they were one of the early type tech companies and they’ve done nothing up until probably about five years ago, when they made this huge buyout of one of these up and comer stocks. And that just made this company now viable again. And otherwise, they just weren’t going to be really anything significant.
So you see it with the big horses today, the big technology companies today. They’re gobbling up stuff right and left. It used to be you had a whole bunch of companies, when they got to a certain size, would come public. They would want to come public. Today, many of them are staying private and then they’re being gobbled up by some of the big, big companies out there. And again, to sustain some of the growth levels that many of these companies are wanting to do, that’s the only way that they’re going to be able to pull it off.
Gary Determan:
The world of business, it’s got to be interesting sitting in some of those board meetings with some of these companies. Oh my goodness.
David Nelson:
Heavens, yes. And I mean, again, the fascination as far as some of the conversations, what are we contemplating doing as far as how do we see ourselves growing? Do we hire more people? AI. I mean, the big scare with AI is that everybody’s going to get fired and we’re going to have AI basically do pretty much everything, going forward. There’s going to be some businesses that that’s the case, but there’s going to be many that the AI is actually going to enhance that and speed up the level of growth. So exciting stuff.
Gary Determan:
I guess so. Now we’re not going to … We got five Wednesdays in December, so we’re not going to visit with you again until January 7th.
David Nelson:
Okay.
Gary Determan:
So happy holidays-
David Nelson:
You too.
Gary Determan:
To you and your family.
David Nelson:
You too.
Gary Determan:
And again, thanks so much for all you do for the community. And so you got a bigger party again tonight?
David Nelson:
400 heads that’ll be there and people that, again, very, very, we’re looking forward to it. Very generous people will be showing up and we’ll be delivering more goodies as far as to some of the charities locally here.
Gary Determan:
And you know every one of them by name.
David Nelson:
I wish.
Gary Determan:
Dave, Merry Christmas. Happy New Year.
David Nelson:
You too, Gary. Thank you.
Announcer:
Financial Focus is a production of NelsonCorp Wealth Management in Clinton and Davenport. The opinions voiced in the show are for general information only and are not intended to provide specific advice or recommendations for any individual. Any indices mentioned are unmanaged and cannot be invested into directly. Registered representative, securities offered through Cambridge Investment Research Incorporated, a broker-dealer, member of FINRA, SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors Incorporated, a registered investment advisor. Cambridge and NelsonCorp Wealth Management are not affiliated. Cambridge does not offer tax advice. For more information, visit our website at www.nelsoncorp.com