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 representatives, 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.
Nate Kreinbrink:
Good morning, and welcome to this week’s Financial Focus brought to you each and every Wednesday morning right here on KROS. This is Nate. James joining me again this morning. A wet one. We were saying, at least it’s not snow coming down out there, but…
James Nelson:
No kidding.
Nate Kreinbrink:
Again, end of November, hard to believe we’re already saying that the year has actually, hasn’t felt like it at points, but has actually moved along very quickly, and hard to believe tomorrow is the old Turkey Day, Thanksgiving tomorrow.
James Nelson:
Yeah. Thanksgiving. Like you said, thank goodness this isn’t snow, and weather’s cooperated. About maybe one of the only things that’s going okay this year. But yeah. Thanksgiving tomorrow and zeroing in here on Christmas here before we know it.
Nate Kreinbrink:
Another big night last night for a lot of the local girls’ high school hoops teams getting back underway last night, and it’s nice to see that, and although, obviously, a little bit different as far as fans in the stands. A lot of schools are making some different options available to have people still be able to watch that, live streaming and through those type of meetings. So, it’s good to have that somewhat normalcy. Although, I guess, whatever we can consider somewhat normalcy in 2020, we will take it.
James Nelson:
Yeah. I watched part of the game last night. Yeah. Nice to see. It almost looked like practice though. There was hardly anybody in the gym, but nice for them to at least be playing.
Nate Kreinbrink:
It is. And again, we joke about, as far as 2020 and looking back on it, and I think it’s easy for people to sit there and look back at all the hardships. And obviously, rightfully so. There’s been a lot of them, whether it’s adjusting for school and what students, and parents, and teachers, and administration, and everybody has had to go to. Healthcare workers, in general, those on the front lines, you just look at all these things. But again, you enter these holiday seasons, and I think it’s important still to look at what we can be thankful for.
Nate Kreinbrink:
And a lot of that stuff, as far as our continued health, and then, having a place to go to, and looking at it from there, and transitioning into actually our show for today, I think the resiliency of some of those things that we just mentioned in the markets, especially, this year. You go back earlier this year, early February, January, it just seemed like every time you turn the news on, we were sitting all-time highs, and intraday highs, and everything with the markets. And obviously, we get to March, with the pandemic and all that bring, and then, obviously, the bottom fell out.
James Nelson:
Yeah, absolutely. It’s been a trying year, and not that we’re focusing on just the economic standpoint. Obviously, there’s a lot that’s going on. And like you said, Nate, a lot of people experiencing tough times and tough situations this year, without a doubt. But yeah, on the market front, it’s crazy to look back at where we were in March and April, and to reflect on where we’re at right now. Most people probably, back then, wouldn’t have thought that the markets could get back to all-time highs. There’s a lot of people still dumbfounded on how the markets have actually rebounded through all of this going on. And there has been a resiliency from the stock market, and things have worked out.
James Nelson:
But it didn’t have to work out. There was a lot of things that played into that. Number one being the government intervention. The government pumped trillions of dollars into the system to prop up the economy. And in the short term, it looks like it’s worked. The federal reserve also did their part by suppressing interest rates, bringing rates down to virtually zero. And depending on what side of the equation you’re on with that one, it’s a good or a bad thing. Great, if you’re buying a house, and buying a vehicle, and whatnot.
James Nelson:
As an investor, the bond yields have been pinched big time this year. And it seems like that that’s still the trend. So yeah, it’s been a wild year. It’s been a wild year in the stock market. It’s been a wild year in the bond market. I think that gets neglected sometimes, and people don’t spend a lot of time focusing on that. But it’s amazing to think that we’re back at all-time highs here at the end of November, given what’s taken place this year. And again, we always go back to it. It didn’t have to work out that way. There’s a lot of factors and a lot of intervention that took place to get us where we are today.
Nate Kreinbrink:
Right. I think a lot of times, you go back to those radio shows that we were doing on a weekly basis and even some special ones that David did in there, as far as market updates back in March, and talking about, as far as how rebounds look like when we have a big crisis like that. And there is always reference to three letters as a reference of how they look. If it’s a V, where it’s just that sharp decline, hits the low point, and then, responds back up, if it’s a U, where it’s that little slower, and then, a longer, prolonged time hitting at the bottom, or a W, which many times, and many experts thought that that’s what we were going to look at, as far as hit that low, have a little of rebound, retest that low before we even go up.
Nate Kreinbrink:
But again, you look at hitting those low points back in early March, and then, getting back. And obviously, it was a big mark yesterday with the Dow notching the 30,000 level, and having it get to that point, and what that means getting back there. But again, you look at, as far as how we get there, a lot of it… And there’s a lot of positive response as far as vaccines and how that is going to come into it. But again, understanding where we are. There’s a lot of cash that is still on the sidelines, as far as people getting out of the market earlier on in the year, money to get back into the market sitting there. So, again, we’re not out of the woods yet, and understanding that, yes, it was great that we’ve got there. It’s helped those balances. It’s helped that uneasiness with people looking at their retirement accounts and other investment accounts, really seeing it getting punched in the face earlier this year and getting back to almost where they probably were to start with.
James Nelson:
Well, you brought up a good point, Nate. How many people have experienced all-time highs? We know a lot of individuals that were wanting to make changes earlier this year and probably did. And that’s always a topic when we experience volatility. Even with markets being up at all-time highs, you mentioned a lot of cash on the sidelines, a lot more in the way of conservative investments. It’d be interesting to see data on how many people have really experienced all-time highs in their portfolios. Because I think a lot of people were making changes earlier this year, given the circumstances.
James Nelson:
And that goes back to what we talk about every week up here, is having a plan and sticking to it because it’s easy to flip out and make those changes at a bad time, say March or April this year, when if you could of closed your eyes or had a little patience, things would have bounced back in a heck of a hurry. And again, nobody knows that. Nobody knew the government was going to come in with $3 trillion. Nobody knew that the fed was going to take interest rates to zero. But oftentimes, doing nothing in bad times like that can be a winning strategy.
Nate Kreinbrink:
Right. I think that hits it right on the head there. And even if someone had a little foresight and got out early in March or whatever, and didn’t experience a lot of that, there’s still that second action that goes into it to be able to do that. Okay, when you got out, great. And then, you limited the downside, but when did you get back in to experience the upside? And there’s those two contrasting decisions there, and you need to make sure you get both right in order to pretty much be successful. And that’s where, as you had mentioned, having a plan, sticking to it, and be disciplined. And it’s an emotional game.
Nate Kreinbrink:
And as you see things continuing to get shut down, as you see people continuing to lose their jobs, the number of cases of continuing to rise back in April, May. And all of a sudden, it starts to rebound a little bit. That’s a very tough decision for people to, again, start to say, “Okay, is it time to get back in there?” And having that gut and having those things that they’re looking at in the tools, in the graphs, and the charts, and historical data, and all that, that needs to be considered, as far as getting back into the market and being able to experience some of that rebound, and again, all-time highs. We’ll see where it goes today.
James Nelson:
Yeah, absolutely. Just going back on the government intervention just for a minute. That was a huge number, $3 trillion, which represents about 13% of the prior year’s total GDP. If we had another scenario where things shut down or need some government intervention, I don’t know if the political will’s there to do it. That was such a huge number of this first go around, to think that another stimulus package of that magnitude was going to come save the day a second go round would probably be pretty optimistic. So, again, stick to the plan. Don’t bank on the government intervention coming to save the day, as far as the stock market goes for a second time. And sticking to the plan really, really makes a lot of sense in times and years like this.
Nate Kreinbrink:
It does. Again, we’ve run out of time today again, but I just wanted to wish everybody a Happy Thanksgiving. And obviously, Thanksgiving this year will look different in many different ways, whatever the case that may be. But again, take the time to really be thankful for what it is that you have, the blessings in your life, the time you get to spend with the family, and friends, and things like that. And really appreciate that, and understand that we’re here for you. If you’ve got questions on any of this that we talked to, helping you out, whatever it may be, let us know. And again, Happy Thanksgiving to everybody out there.
James Nelson:
Yup. Happy Thanksgiving, everybody.
Nate Kreinbrink:
Did want to mention real quick though, before we get cut off, is that every Friday, NelsonCorp Wealth Management is wearing jeans for charity. Money raised in the month of November will be donated to the Help Program sponsored by RSVP here in Clinton. Again, Nate and James with NelsonCorp Wealth Management, bringing you this week’s Financial Focus. Thanks again for tuning in, and have a great rest of your week.
Announcer:
Financial Focus is a production of NelsonCorp Wealth Management in Clinton and Davenport. 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 representatives, 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.