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:
Thank you, Brandy. I appreciate it.
Brandy Auterson-Hurst:
So David, at the end of 2023, the economy and markets seem to be going strong. But since the start of this year, things feel like they may have cooled off some. Share your thoughts on that.
David Nelson:
Yeah, you’re spot on. Last year, in particular the fourth quarter, stocks, bonds, real estate, publicly traded real estate. Pretty much everything took off in the fourth quarter, primarily driven by the hope and the expectation of many rate cuts. Interest rates have gone up. Now people are anticipating and hoping that interest rates are going to come down. But it’s important to understand as far as rate cuts, it’s kind of a double-edged sword. The positives are probably pretty obvious to most people, borrowing costs go down. But negative, I think people overlook oftentimes, and that is wire rates coming down. Is it because of a fear of recession? That’s a big, big item. So I have a chart today. It supports the case, I think, for a cut. And what we see here is this is the manufacturing business conditions index. It recently fell to a level that we haven’t seen since 2020, and it’s actually lower than it was during the great financial crises that we had in ’07, ’08, ’09.
Brandy Auterson-Hurst:
Okay. So how should viewers think about this when it comes to their investments?
David Nelson:
Well remember, no single indicator should basically drive your decisions. It’s the body of all the work, looking at many different things. But clearly there’s some evidence as far as that risk assets are struggling a little bit right now. So be cautious. Keep an eye on your stuff. Maybe think about rebalancing. That could be a good idea as well.
Brandy Auterson-Hurst:
All right, David, some good advice. Thanks for joining us.
David Nelson:
Thank you.
Brandy Auterson-Hurst:
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