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. Representative securities offered through Cambridge Investment Research Incorporated, a broker dealer member 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, good Wednesday morning. It is the first Wednesday of the month. So the program is live. Dave Nelson, joining me by phone. Good morning, Dave.
David Nelson:
Good morning, Gary. How are you doing today?
Gary Determan:
Pretty good. It is Catholic school week, and I know a lot of celebrations going on at Prince of Peace. And you helped with the celebration with the victory last night.
David Nelson:
Yeah, we didn’t play best. What we’re capable of, that we pulled out the win. We had a second, two seconds on the clock and Sarah [Molar 00:01:16] put the ball in from about two feet in front of the goal. And we got the W so kind of an ugly win, but a win’s a win I guess, is what people say. So we’ll go along with that. The season progresses this week. We’ve got a game tomorrow night, it’s a makeup game. And then we’ve got homecoming as far as Friday. We’ve got Midland coming in. We pulled that one out in overtime as far as the first time with them, so should be a competitive game as well. Yeah, it’s a fun week for everybody. It’s looking forward to homecoming and it should be a real good time for all.
Gary Determan:
Now, do you still get the opportunity to get everybody into a frenzy at homecoming on Fridays?
David Nelson:
I sure try, Gary. We’ll see. As I’m getting older, I missed last year. That was the first one I’ve ever missed as far as since I’ve been coaching, but anyway, long story short, but the goal is just that. And we have a lot of fun. I’m a nontraditional guy. For those that don’t know me, I’m not the real straitlaced and uptight type individual. Try to have some fun. And again we’ve … through the years, it’s been a pretty successful week for us as far as throughout history. And I guess it’s now 17 years of coaching. I think we’ve got 14 wins as far as in homecoming, so not a bad batting average. And I hope it has something to do with the energy I put out during homecoming.
Gary Determan:
Well, I’m sure it does.
David Nelson:
[Crosstalk 00:02:43] rallies as far in the morning.
Gary Determan:
I’m sure it does. Hey, last Wednesday on our coaches show, I had the opportunity to visit with Lily Eisenhower. Of course she is the last of the Eisenhower girls, just went over 1,000 points in her career. And my goodness, she is knocking on the door to 1,000 rebounds. I think that’s even more amazing.
David Nelson:
It really is, and she’s, stuff like this can happen as far as when you don’t have a lot of players around you. There was one gal that kicked us out. We were on our way to state the very first time when we’re down in Washington, Iowa playing, and one more win and were at state. And this gal, she too had the 1,000 and 1,000. And she was really, really good, but most of her career, as she said, she didn’t have much talent around her. Lily’s had quite a bit of talent around her to be able to pull that off with a pretty good group, people that want to score and people that want to rebound. That is quite impressive. So I’m really hopeful she gets it. She’s going to be really close if she doesn’t assuming she doesn’t get hurt the next several games.
David Nelson:
The other reality is that a lot of these individuals have gone deep in the tournament this year. If we could get to the second or third round, which is going to be really difficult, eyeballing as far as what it’s going to look like, an extra one game or two games can be her getting to 1,000 or being just short of 1,000. So very impressive to say to least, and she’s just a good kid. I’ve really enjoyed coaching her. She’s as you say, she’s the last of the Eisenhower girls. So she’s watched a lot of basketball through the years. She’s gotten some extra insight as far as from some of the siblings and her work ethic. I will tell the story as far as to the school and try to motivate them as well as just as individuals, has nothing as they tell them to do with basketball.
David Nelson:
She made a comment to me as a ninth grader and said, as I would quote her sister a fair amount as far as just what she did in this situation and so on and so on. Katie. Katie was in my opinion, the best of all the Eisenhowers. And I used her as an example and Lily came up to me after practice one day and she said, “What do I need to do to have you talk about me and not about my sister?” She meant it. Some kids would say something like that in a nasty way or whatever. And it wasn’t at all. She just wanted to, “Tell me what I need to do to be better than Katie. I want you talking about me for years to come, and I don’t want you talking about my sister. I want to improve.”
David Nelson:
And Katie wanted that as well. I told Katie exactly that. She said, “That’s exactly what I want to hear come out of her mouth.” She’s had the drive to be good, and everybody knows it. I mean, this year she’s just not getting double teamed. There’s been numerous games she’s been triple teamed. And the teams that clearly do not want her to have impact and one was successful. They kept her to six points. I think that’s the lowest point total she’s probably had in several years. But yeah, I’m hopeful she gets this rebounding, 1,000 rebounds that will … She’s already got the number for the school. Now it’s a matter of, can I get to that magical 1,000 rebounds? That would be pretty cool.
Gary Determan:
Yeah. I know the Eisenhower family very well. Had of course the chance to cover Andy when he was playing ball for the Irish and every one of his children. So yeah. Hey, you wanted to go in a different direction today, right David?
David Nelson:
Yeah. Time permits, I’d like to spend a little time. It’ll probably, I hope not, but probably put a few people asleep and there will probably be a few people saying, “Why does this matter?” But it has a lot to do with what’s happened globally. And I think that the one that’s most obvious is Russia, as far as some of the claims that they’re making, as far as the plans that it looks like they want to try to pull off. And it really is important to us as far as investors. And again, my goal here isn’t to act like a know-it-at and we have all the answers. That we do spend an enormous amount of time researching. We do spend a enormous amount of money buying research. And at the end of the day, the goal is to have this hopefully help people grow their money, but also protect their money during strange periods of time.
David Nelson:
And I think we’re coming into a period of strange times as far as with Russia, probably. And again, I’ll get into a lot of details far as on this in the second half. But the odds have increased quite dramatically that something is going to happen as far as with Russia invading Ukraine. And again, the ripple effect that can stem from that. Then we’ll talk if time permits a little bit about China, as far as some of the vibrations that are taking place over there, again, as far as with Taiwan and again, what that can mean as far as to the average investor, as far as in the Clinton surrounding area. Anyway.
Gary Determan:
Okay. Well, it sounds pretty interesting. Let’s get into the weather a little bit early and then we’ll touch upon those subjects. Again, visiting with Dave Nelson on Financial Focus. This weather update brought to you by Kelly Heating and Air Conditioning.
Andrew Stutzke:
Snow flying across much of the region this morning. Heaviest will continue to remain south and east of the Quad Cities, but the still expecting an inch or two of accumulation here closer to the metro area. And breezy conditions too could cause some minor blowing and drifting of snow, especially in the open and rural areas. Temperatures considerably colder today. We’ll see highs near 20 degrees. Snow tapering off to snow showers overnight, so drop to 10 above zero. And a couple of showers left over for Thursday. Still tracking a colder day there too, with highs in the upper teens down to one above by Thursday night as all the snow comes to an end, and we get some clearing in here. That’ll give us a mostly sunny sky to end the work week for Friday and highs in the mid-20s. With your StormTrack 8 forecast meteorologist Andrew Stutzke.
Gary Determan:
Our skies are overcast. Current temperature 15 degrees. Winds out of the north averaging at about 15 miles per hour. Our update brought to you by Kelly Heating and Air Conditioning.
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Gary Determan:
First Wednesday of the month. So we continue to the bottom of the hour. Again, Dave Nelson of NelsonCorp Wealth Management here on Financial Focus. So Dave taken it away.
David Nelson:
Yeah. Well, thanks, Gary. Again, I’ll just reiterate as far as a lot of the stuff that I’m going to talk about. It’s certainly our opinion and the opinion based on a lot of research done locally here, as well as other individuals, as far as that we buy research from. And again, it centers around what? It centers around individuals trying to make better decisions as far as growing their money, but also protecting their money during periods of time similar to what we find ourselves in right now. Most of the attention that people have looked at as far as over the last month or so, it’s really centered around the federal reserve and increase in interest rates, and interest rates have gone up some. They’ve retraced a little bit, but at the end of the day were up.
David Nelson:
The stock market didn’t like that, and the stock market sold off. You had technology stocks selling off north of 15%. You had big cap stocks as a whole, as far as non-tech type stocks in the 10% range, give or take. You have bonds year to date that are showing returns of negative three, four, 5%, depending on the type of bonds, the quality of the bond, et cetera. That’s been pretty much the focal point. People get their statements and what have you as far as they go online and look at their account balance. All of it again has been centered around what is the fed going to do? Well quietly on the back burner this has been the case for years, but it’s certainly getting closer and closer to probably game time. And that is that Russia is really, really focused on invading and has troops lined up as far as on the border, as far as with Ukraine.
David Nelson:
And so again, people say, “Well, does that really matter as far as to me?” And I say, well, as far as your money is concerned, that’s a big item. I mean, if they invade, we’re talking about probably very significant odds of the stock market rolling over pretty significantly as far as during that period. We also are going to be affected here as well as throughout the world as far as from the standpoint of oil. We see that when you go the pump, that prices are up. That’s not because the Federal Reserve talking about increasing interest rates. That has everything to do with as far as Russia and what they’re proposing to do as far as over again with Ukraine. So from our standpoint, again, we try to always place odds as far as what are the odds that things are going to take place.
David Nelson:
And we have been yapping for probably last several months, but it’s probably in the 50/50 range. We believe it’s increased, and we believe it’s increased for many reasons. One of which that Russia is really paying close attention. And we have hidden the fact that we’re basically sending weapons over there we’re selling, sending over. Just recently there were six. I forget the exact one, but they’re really sophisticated helicopters as far as over there. And they’re now, the United States has now allowed other countries as far as to share weapons from the U.S. that were bought from the U.S. to share them with Ukraine, so other countries could do the same as far as to support. And so again, Russia is getting very uncomfortable with this the longer that it goes on and the more weapons that are showing up. And all of it pretty much centers around them wanting to own that area and to have the United States as far as out of Europe in the very general statement.
David Nelson:
I would say again, the odds have increased pretty dramatically. We’re we’re telling people the odds are probably in the 75% range that something is going to take place. Again, all that may basically has to do with, as far as this program, is that individuals out there should be paying really close attention to this, and probably be thinking very proactively as far as if you have some really, really nice gains the last several years, which pretty much everybody that’s been invested has, it might be more earth taking a hard look at it, and maybe taking a few chips off the table. In other words, selling a little bit. Obviously I can’t give individual advice as far as in this forum. And obviously these are opinions of mine. And again, it’s very important that people understand that. That this may or may not take place, but the reality is the odds have increased or many reasons as far as that Russia will invade.
David Nelson:
Beyond that, I guess I would just say that again, we talk about what are the opportunities that are there. We’re getting people saying, okay, if something bad is happening, what’s happened to Russia, the Ruble, stock market. Yes, they pulled back and they pulled back fairly significantly over last several months. Again, this is just generally speaking, it’s probably way too early as far as for people taking a peak as far as is the time to start buying those types of things. So as far as the last part of that, as far as in this discussion and Russia, is that you would assume that if we look in the history book and we look at what’s taken place with similar type of events, that normally what you find is that the defensive type investments do best through periods of time like now.
David Nelson:
Historically, what does that mean? Historically, that’s going to be utilities. That’s going to be consumer staples. Again, energy is somewhat in that space. Those are pretty much the investments that have probably the best odds of working. Now, fast-forward to on the back end of this thing, what is probably something people typically go to, and this gets a little more complex. But in big picture, you have value stocks, which are typically old school type stuff. And you have growth type stocks, which is primarily technology. History says people should buy value type stocks because value stocks in that environment should do probably better than growth. It’s a different world that we’re in today. So again, I don’t think I’d take that quantum leap from the standpoint of just assuming that it happened yesterday, so tomorrow it’s also going to be the same thing. We’re not in that camp.
David Nelson:
We would say again, stay defensive as far as in the short terms, probably a pretty good bet for you. And then again, looking forward beyond that, you got to say, what type of investments would be that makes the most sense as far as going forward? Again, this is a really important one as folks to get right. You should be visiting with your advisor. Talk about again, what move should I consider as far as in the short term?
Gary Determan:
Again, visiting with Dave Nelson of NelsonCorp Wealth Management. Visiting with you through the years, I’ve always been amazed how global things have become. Now, you’ve been doing this a lot longer than what I’ve been listening to you. And how has this come about? I mean, when did things get beyond our borders, Dave?
David Nelson:
Technology has certainly had a massive impact over the last 15, 20 years. I would probably put in that category, Gary, as far as that. That would be the timeline. Prior to that, again, I mean, my early days back in the early ’80s, I would talk to people as far as investing abroad and I would bring up emerging markets. And I’m not exaggerating when I say this, but I think many of the individuals then thought you were putting the money in mud huts over in some part of the world, Africa, whatever the case may be. And today that’s not the case. People realize that it is a very global type economy. You look at where a lot of stuff that we buy comes from. You look at as far as the stock markets, as far as the impact that the stock market in Canada, a stock market in Africa have, can have as far as on the U.S. stock market.
David Nelson:
It’s changed. It’s changed quite dramatically. From the standpoint of the average person out there again, that comes back to the situation where we’ll get from people occasionally that, “Why do I care about this?” And you should care about it because it does matter. Now, it’s our job as far as to take care of that, as far as for our clients and help them make those good decisions. And nobody has a crystal ball to know exactly what’s going to take place. But when you look at what’s happening out there today, not just in Russia, but if we go to China and we look at Taiwan as far as the stress between the two of those countries. Ukraine is basically the Taiwan to China. So Ukraine and Russia, that’s primarily what they’re trying to prevent.
David Nelson:
It’s not having a weaponized country as far as right next to them, the next door neighbor. They don’t want a Taiwan as far as like China has. And so that’s why this is such a big item. And again, it’s from the average person standpoint, well, I’ll just invest in U.S. Well, there’s all kinds of opportunities that are out there, and there’s going to be a really good opportunity as far as to invest as far as in Eastern Europe, if this thing cuts loose and if the market rolls over in a significant way, which would probably be the case. There’s going to be a really, really sweet spot there as far as to look at investing and trying to capitalize and take advantage of that opportunity. It’s crucial that people do pay attention. And again, that’s why we love this forum as far as to be able to have a few minutes, to be able to talk about it and tell people that again, at the end of the day, yes, it’s boring, but it really matters as far as to your tomorrow.
Gary Determan:
Yeah, it is fascinating to hear what you all have to say on the subject. Now, of course, China, they are getting ready to host the winter games. They are welcoming the world to their nation. How does act play into everything, Dave?
David Nelson:
Historically, as far as the host, as far as that handles or takes the Olympic games, if you were to look at their stock market leading into the Olympics, up to the Olympics, the bottom line is the market typically explode on the upside. I mean, it’s a really wonderful thing as far as for the stock market there. When you look on the back end of it, it’s almost the exact opposite. Now, the increase and the decrease aren’t equal. So you get a big increase and you get a pretty, I’ll say a moderate type decrease as far as the market. China, we haven’t had that. And so it has been different this go around regarding the Olympics. And again, the theory is you got all these human beings that are coming there. You got all this infrastructure build out. This is all going to be great news, not just for the period of time that the Olympics take place, but over a long period of time, all of this is really good news.
David Nelson:
Well, that hasn’t been the case this go around because all of the build out that’s taken place in China has been viewed almost by nobody because of the COVID virus. Subsequently again, China, hasn’t seen the benefit just like Japan put in billions and billions of dollars into it. To date, I’m sure it’s just been a massive, massive loss as far as for the country versus what’s come in as far as visitors, et cetera, the industry for the Olympics and versus what’s actually taken place, because again, this COVID virus, as everybody knows out there, it hasn’t been just a problem for China, but it was a problem for Japan.
Gary Determan:
Even prior to the COVID virus, nations that would be hosting the Olympics would put so much money into the infrastructure, the new stadiums and whatnot. And then a lot of times after the games are gone, they sit basically empty.
David Nelson:
Yeah. Yeah. It’s pretty bad, isn’t it?
Gary Determan:
Yes.
David Nelson:
I mean, the goal. Everybody has the correct goal as far as to build this and they will come and oftentimes they haven’t come. And you see some of the countries that are now bidding as far as for the Olympics going forward. These would be in the category of emerging markets, which again, the folks out there, you’ve got the United States, then you’ve got to develop a part of the world, which would be Japan. I’m just rattled off a few. But Japan and Canada and Australia, Europe as a whole. And then you have the others, which would be falling in the category of emerging markets. And they’re the ones that are pushing for it now, because I think a lot of the developed countries have seen it at least the last several, it’s a big anchor.
David Nelson:
They haven’t seen the real benefits as far as coming out of this though. That will be interesting too, as far as going forward. And you’re exactly right. Many, many, many beautiful structures that have been put up and the usage of them versus what went into it is really, really sad. And again, we’ll see as far as if that takes place here. China is really proactively trying to control the growth in that country. We had the one child policy for decades. That is to some degree blown up in their face. Now we have this economy that the government, excuse me, is trying to control. And again, it’s going to come back to will this experiment work? [inaudible 00:22:56] people looked at it enviously, as far as they’re making some really good decisions in democracy.
David Nelson:
We have our problems as far as with democracy, but I think we’re seeing some of the other side of it too as far as where again, you keep your mouth shut and you fall in line or there’s going to be problems. And again, they have a lot of big issues over there with the population of billions. I mean, this is a big, big problem that they have.
Gary Determan:
We got about a minute left in the program. Just wanted to make the comment. We had Mike Van Zuiden in for our men’s day on Friday. He of course with NelsonCorp tax solutions. And again, what a great advantage to have them as part of NelsonCorp.
David Nelson:
It really is. It was something we’ve talked about, Gary, for years and years, and we’ve been wanting to do something. We just couldn’t figure out as far as the legalities and how to pull it off, one. And the number two, finding a really good fit. And it started with Deb Montgomery, as far as we started working actively with her from afar when she was on Second Street. Then we brought her in-house here and it was a separate business altogether. And that was the case for several years, and that worked quite well.
David Nelson:
Then we decided that what we need to do is we need to integrate as far as the businesses more and more, and subsequently that’s what we did. And it’s really worked out. And again, it comes back to having the right people. Mike is terrific. I’ve known him for a few years now, and he is just a terrific fit. He works very well as far as with a lot of our clients. They like him. They like Andy. They like TJ. They like all the people as far on that side, but they’re doing just a terrific job. So thank you for bringing that up.
Gary Determan:
Yeah, no problem. Hey, best of luck. Homecoming this week.
David Nelson:
Thank you.
Gary Determan:
Catholic school week, and again great always catching up with you, Dave. Thanks so much.
David Nelson:
You as well, 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 invest into directly. Registered representative securities offered through Cambridge Investment Research Incorporated, a broker dealer member 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 for tax advice. For more information, visit our website at www.nelsoncorp.com.