Planstrong Financial Forum 03-11-17
Mar 11, 2017|
"Smart investing, simplified"
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
From the plan stroll in the broadcast studios it's hoopla and strong environmental forum where you're hosed. Campaign armory and hope for juveniles planned strong investment of full portions based on Bruce Morton investing. Simply fall and I'm Ken carver of the introduced along with Paul horses look back the pro. Graham ball great to be Uranus she'll leave march week ever know we're we're not quite you don't have just last week we before is NG we can see the end in sight but yes we cans. Senior and feeling good are two completely different jobs and our sound guy. But at least we know what's coming it is I who work. I always do winter in four segments you know December urgent secret very mark OK if he were in the fourth quarter that's all I can tell. It did the end is in sight. It doesn't feel that way this weekend or maybe not the coming weeks and Goosen yeah -- I think you're supposed to snow and guess who's there Wednesday or something right so well I'd say little snow a couple of days out it's freezing cold how tough guy that's all right and you've got plans and go to Florida of some point in time I do so that's always good excuse to stay warmed her shoulder his son right well I'm I you know we talked about you and I both had the poor man's Florida experience the last few weeks wonder whether action was nice and everybody else traveled away in person -- it was nice here is present here -- -- yeah but I'm actually into the real McCoy this I'm just for a weekend it'll be nice to you know we're looking at the at the calendar is outta the calendar we realize who we are in March so -- -- getting ready not only using salute it's the fourth quarter of of winter but it's also the first quarter of this year out and we kind of looking at we're we are in point we are in place it's. We've never seen before. It's a talk a little bit about that how we're seeing things who have never seen before dramatically different from just a year ago as we mentioned before the program. Just completely different so folks are are set of their invested in the same manner as they were last year. They can lead to a lot of money on the table. Well yeah I I would certainly argue that conditions have changed a hot and in a year's time and just think about it a year ago Britton was still part of European Union and was gonna remain a solid particle European Union and Hillary Clinton was going to be an express and United States right and I I think both of those were very high probability events. Up to and including the day of the action right right for both cases I mean is that astounding what and it's not even like it it turned a little bit and now. As you go forward there's a whole bunch of news that's coming out now we have president trump love him or not he's our president. We about a Republican dominated congress and senate Bryant an. And you know bit this week was a perfect example of how fast things can move. You may or call thicker took presser Obama about to who yours. Of being elected before he got the Affordable Care Act and you know where it's well revamped their through the legislative process. I think more what do we were in the first hundred days of Donald Trump's. Administration and Andy Mori put together or repeal and replace of obamacare so I mean that the pace of change is. Is really quite something and frankly as an N Jasper. You really have to pay attention to this I'll just give you one. Colonel that great out just this week of Elijah Cummings who's who's they congressman who is you know assert he's a democratic congressman. He was a big fan of obamacare he is not you know he's not necessarily big fan of president trumps. President trump reached out to me he said you know what are you looking for I eat in in dis. This next. Health care bill and he said you know I'd like she problem drug prices be reasonable and and trumps what you know what I I think there's something to that I think we should build something like that into that. Well if if you're invested heavily in farm then I have to tell you there's a likelihood that the profitability. Of big pharmaceutical companies. Will not be as good as it might have been projected to be otherwise stuff up just based on that that's just one conversation within one bill. That is you know rapidly moving its way through our our legislature right now so I think it's just perfect example of how quickly things are changing. And as a result. What does it mean if you listen and faster does that mean you stay market neutral on healthcare does that mean or maybe stay market neutral on health care but you what do you emphasize for example big pharma and you invest more for example in Biotech or hospitals or insurance companies approach it there's a whole. Our thought process behind what could and could not be impacted you know by just for example those first major piece of legislation that the new president is is working its way through the of the legislative process at this point. So imagine folks you're giving your office a call to say you know Emery Emery invested correctly that sort of thing you're up to look at their portfolio let me just remind listeners of her phone number Paul. It's still free 89727526. That's a DD 972. Plan. Or go online to plan strong dot com as simple an email though you're right back Q and he's a football and his team and say. Am I doing this correctly given where we are now and we're we're going to be in the near future. On the another question we get quite a bit of the time is hey is this the peak you know it would that the short answer is this is the highest point that the US stock markets have ever bet. Okay right and so that the natural reaction is a lot of people moan Newton's law which is what goes up must come down Irish and the question is. You are we getting close to the end of this thing is time for me to pare back should I cash out some of my gains. And so forth. So it's not just even the impact of president trump but I also. I would argue that the way the markets have behaved over the let you know since his inauguration actually since his election. I'll Wear them the S&P 500 which is an index of 500 largest poppy trade stocks and it states. Is up I don't know ten or 12% since his election. Right. I mean the quiet and and actually is eclipsed all time highs so the question is is there more left at the party is a time to push back. On end and you know that's another thing that we look at and we have a very strong opinions about and as a result it's boot the basis on which we are investing our current clients were happy to talk to. Clients or what are prospects it would like to commence you speak with us and talked slew older Barton. Give a more opinion of why we think what's gonna happen is gonna happen. Oh dear postal free number 88897275260. Let's take a look at what happened over the past week. A look we learn from it US stocks were down a bit. Just a little it's funny they they were down. You know maybe between half a percent a percent during you know or the beginning to the middle of the week and then we got the jobs report towards the end of the week actually it was Friday morning yesterday morning rich. And not and that kind of turned things quite a bit so that the though losses for the week were really pared down I think god McDowell you know looked to be just under 21000. And yes and 2400. Both of those were a levels that were all time highs this sad so. It was a nice recovery. And and if you look at European stocks they were down just a little bit to not not substantially in fact they got a nice piece of news from Mario Draghi the head of the ECB. Who said that. You know conditions were improving in Europe as well and and as a result I think you see a lot of kind of bit her new who's out there we talked about that last week and our our show last week we get a whole bunch of stories around the key data that was released last week and I think you know when you look at the fact that we looked at eight or nine. Key. Economic metrics that different departments of our government released almost all of them work. And at a at a minimum they were average and at a maximum they were outs and write run on and so when you look at that range say you know what this is a pretty strong underlying. Economic recovery at this point and and economic growth situation at this point and you know I think that was reiterated this week by what happened with a jobs report and you know where essentially. A the February employment situation report came out and said endure another 235000. Jobs added in the month of February. That's almost identical to the number of jobs or added in January. And as you when I have talked about anything over 200 I think is is a good numbers relates to nonfarm payroll so. At this is a very important report. That on the Fed for one looks at the very closely because don't forget the Fed has three mandates. One of them is economic growth third GDP type growth. Another one is inflation. Some of the inflation numbers that we're seeing have been you know us significantly. Better and we somewhere that in this jobs report as well. And then the third thing is employment and you know frankly we're seeing all three of those things in the look and you know pretty good at this point so. That leads to what that's what the indications are for interest rates where half with interest rates this week as well talk about that once sacked. We just finish up on the jobs report. I'm so not only did we had 235000. Knock off farm payroll jobs unemployment rate went down just attraction for rate to 47. The and these labor participation rate actually ticked up a little rock's a good thing. And but here's the other thing that frankly the Fed looks at a lot what happened with average hourly earnings. And they were up point 2% month though Vermont that's you know two to one half percent type growth. That's well within their target I think we're seeing an awful lot of indicators that say. The kind of a thing it was really lagging. Four are lacking. For the Fed Kenny as they were considering whether or not pure into a rate increase since and how soon was inflation rate we new jobs and kinda picked up pretty well. On and we we thought that Tom overall GDP growth was okayed good but not great. And now we look at this employment situation and be more portly looking inflation. And inflation really looks like it's finally much closer to their target so overall the probability of a fed rate increase. When ups are this week and interest rates went up this would merge is kind of the corollary what we're just talked about in fact. Of the ten year US treasuries now treating. About fifteen basis points higher point 15%. Higher yield down at the beginning of our 2017 it's recurrent two point 6%. Armed. And all that also by the way happen would German bond deals this wild they also ticked up a bit again on the on the comments by the head of the ECB saying that. I'm an economic activity was better in Europe and that inflation looked like it was improving in Europe as well don't forget Europe was really worried about having briefly action. Not so long it. And dis issue very very welcome news site I would say overall you're seeing a couple of areas both the US and Europe. Showing relatively stronger growth strong core inflation. And maybe even the possibility of not just the US fed. Backing away from I'm support of monetary policy but maybe even the European Central Bank doing same thing. Speaking of the US and if you look at Fed Funds futures probability spur a read increase. It's now over 90% probability. That there will be a rate increase in this month's fed meeting. I'm so another point 25% increase and what's even further interest thing is. There's now a greater than 50% chance that they'll be 82 rate increase in June. So this is really moving up. And I think again that's good news it's good nose for those or investing in bonds and an actually not those that own existing bonds Irish but those that will be buying bonds and think about the sabres out there that for years have been struggling with interest rates not being able to earn a relatively good return good interest rate on a bond. If these interest rates go lower if the short end of the curve interest rates go up it's likely the long and will grow up as well. And we'd expect finally deceased sabres were rewarded with a higher interest rates pull combat we'll look at the dollar oil and more super strong financial form. This is tall Parsons president of planned strong investment management. And you're listening to them plans strong financial forum on WRKO. Boston's talk stations. If you like what you hear on our show and what need to take a look at your investments and retirement plan called my office of 80889727526. That's 888972. Plan. Securities and investment advisory services offered through an intranet to prevent remembered him as I can sequester investment management is an affiliate business financial group think is located in Washington street domestically and six. Hi this is Bobby Nelson people use different strategies to acquire enough money for retirement. Some try to do it themselves. Others buy insurance for investment products though sometimes will benefit the seller more than the buyer what makes sense is to hire an advisor with first rate credentials and why do investment management experience. Should have a fiduciary obligation to act in your best interest. And be paid the same amount no matter what your invested in if these things matter to you. Call Paul Parsons at planned strong investment management to learn more call 888. 9727526. Hiring the right advisor could be your best investment. That's 888972. Plan. Or visit planned strong dot com. Securities and investment advisory services offered through next financial group and member camera SIPC plans to investment management is not an affiliate of next mentioned grouping and is located at ninety to Washington street Dedham mass of. Okay. It's. It's. It's. Crumbled plans from broadcast studios of the epicenter of capitalism this is the plan's strong financial forum revolt portions president of planned stronger investment management and I'm going to. Arbor at the egg doesn't along with Paul Parsons. Always president of planned strong investment management once again is toll free number eight DD 9727526. And a bold during the break we're talking about his return Tony interest rates because his fascinating watching them tightly Kamal but seems like forever. Abu read you mentioned that gift unlike women her for a little while to play ball on us as as as proclaimed by Barron's Magazine which yes exactly thumb but he hasn't and I'll look for 2017 which is interesting because you know we haven't heard much perhaps you've heard much from because bonds haven't been is that important. An investment item and is they may be in the future. Well it's funny. It was he actually described it as kind of a cyclical situation reminds had been and you know relatively recently kind of isolating being held somewhere between. 2.2 12 point 5% for you know at least since the trump presidency and and frankly for awhile before that sound. He was saying it's it's been a long time but it was interest thing. He finally did come out speak to investors this past weekend and you when I do listen to him by the way I'm black. I don't pay nearly as much credence to his stock. Prognostications. As I do respond but I have to tell you this guy is one incredibly accomplished. On me catcher who for those of you who don't know years he he actually Rihanna. Are deemed one of the most successful bond funds act trust company of the west TCW. And he left the air and started his own firm called double lined capital and we did a very short period of time. Assembled an immense amount of money on and ultimately his performance. Was very very good any supplanted Bill Gross says that quote unquote king of bonds so the guy has he really really good handle. And I like his rationale. On the bond market if it did this guy is absolutely on top of that so it you know you and I bull Andalusian him pretty hard. So anyway he met we did our investors this past week and he talked about fixed income and I want to assure our listeners some of the things that he forecast because he's right a lot of time and fixed incomes now first thing he said was set. The ten year US treasury is gonna actually he expected that in the short term the ten year US treasury to actually get stronger at a price to collapse of the yields to come down low hanging. But by the end of the year. He expects. On the price of the US treasury to go down such that the yield is gonna go from ten days two point 6% and up to 3% are OK so. He and you know what I don't think that's any stretch when you think about the kind of increases that the feds talking about doing when he even talked to him. About what's difference between this year and last year he really set it was a couple of things. One of the biggest difference is that the bond market is actually showing what he called a lot more respect for the Fayette in other words. Last year the faster or gonna raise interest rates you know 234 times and the bond market said no not. And you know bonds just didn't trade that way Fed Funds futures didn't trade that way nobody believed and guess what they were right. This year it's different you hurt me just say in our prior segment. That Fed Funds futures now are predicting not only are a rate increase in March but also a second reading Kris. A greater fit greater than 50% probability in June so you know are now all what's happening is. The bond market is actually believing what the Fed is saying and if anything it eight may even be a little bit in front of what the Fed is doing. Said it is that a self fulfilling prophecy when the markets says we agreed that helped to go up and last year did the market itself pulled back some. Otherwise we could have been bumps in the interest rates. I certainly on the psychological. Our level as it relates to investors this don't forgot the spot in on the stock and bond markets are living it breathing it. Organisms and there are of of traders a motion studio and do the traders really believe what they're hearing. And and what he's saying this year is that traders actually do belief. That there is cause. And by the way it's good caught starts yelling you sent this is good stuff that's happening underneath this he expects to see. Better job growth more economic expansion. Tax cuts fewer regulations and so forth that really could fuel this thing as opposed to oh geez we need to normalize rates I wonder how we're gonna get there. OK so that was one thing that he mentioned and the other thing that he said was that the global economy has undergone its most synchronized. Upturn. Sense we have our Great Recession and in other words finally. It looks like Europe and the US are moving in the right direction. Act the same time both economies look like they may actually be starting to move in the same directions and maybe even Japan's. And if that's the case what it means is you don't have diverging. Bank policies. And that's incredibly important because if the United States is is such actually tightening monetary policy. But Europe is loosening well European investors just buy our bonds and they screw up our tight. On and so our interest rates don't go up as a result okay. And so it's very very are important to note that it looks like things are finally moving in concert together. And potentially for the right reasons which is that. Overall economic growth around the world looks better than it did before blood user are worried about inflation wall they're always it is if you start to talk about interest rates why does the Fed entry increase interest rates the answer to combat inflation or access and flee. What he set was that investors. Actually should be paying attention to inflation. Debt but the risk of recession. Is no longer the error but there is very much. Are concerned that if things aren't managed properly by the Fed. Then inflationary forces could push inflation more than you'd like it to be. And you know it's funny because in the past gun locks mentioned that the US economy usually enters a recession in the first term of the new presidency like now rude but. And even if what one was an imminent. But now he's saying I just don't see a recession happened there just aren't the circumstances around so there'd be a recession in the United States and don't worry about recession. But on the other hand. What he said is that economic indicators of strengthened over the past several months. And even nominal GDP is forecasted to be four and a half percent or higher reflecting higher inflation. Okay. And so inflation expectations. Could even be further fuels. By things like tariffs on imports. When you think about the products that we import in the United States automobiles auto parts and so for those of some of the biggest things. If they have a 10% tariff on them all of a sudden that becomes very inflationary. Okay Brian so that's why he sang you really should be aware that their are forces out there that could drive inflation faster or. Then they would otherwise driven without our new our terror policy. And so ultimately the other thing he's worried about is that the Fed goes quote unquote old school. And what that means is the Fed would just raise rates in bigger chunks instead of point 25% kind of lumps maybe even go point 5% launch and it doesn't sound like a lot to a listener. But I have to tell you something at some point you hit up a point where it becomes too expensive becomes prohibitively expensive for businesses to borrow. And what you don't want to do is seen them raise rates too fast so that if you will until something breaks. But that's not good either so the point is near he expects there to be inflation for some of the reasons we talked about and there is a risk of course that the Fed a does too much too fast. To counter were so there are risks around that but overall he thinks that. We're looking at longer term interest rates bumping up in the next. Going from. Where they are today all the way up to 6%. For a ten year. We have to see the number of part time. I'm does he think that this will happen Beazer reasoning is true that I and number yeah well a couple of reached this was absolutely fascinating I learned a ton from us. One if there's a confluence of events that are gonna happen first of all there are going to be the rolling over of bonds issued during the three quantitative easing programs don't forget. We we did what two or three trillion dollars on consumer okay do and they're gonna roll over okay and all those bonds go to market are okay. That's got to drive down prices it's got to drive up interest rates you would think. There's also a need to refinance maturing corporate and junk bonds if you look as as he's gone specialists still. They know when the knee jerk corporate issues are coming due and and they have to refinance them what they've essentially figured out is. When they look at across the industries they are a whole bunch of corporate and junk bonds corporate investment grade and junk bonds that are common do over the next two or three years and they're gonna have to get refi. And that means they're gonna have to reassure them which means they're gonna be out there on top of all that government paper that so we talked about as the result of of IQE one through QE3. In the United States. And by the way all of this happens. When there's a spy leak in entitlement spending and it you know 234. Years out from now. All of those things are very very good reasons for interest rates to go up into court substantially. Between now and say three years from now and that's the underlying basis for his. Our forecast but the tenure US treasury could hit 6%. Three years from now. What does it mean for investors it means keep some cash because what you wanna do is one of buying in on the way as interest rates cooped. And the worst thing you can do is lock in today two very long term high quality bonds because your essentially buying and 28. And interest rate that your stock we have further term of that bonds are you by a thirty year bond and it and it's paying three and a half for 4% today. And the ten year treasury goes to 6%. Boy that that 4% thirty year bond looks pretty darned inferior and your stock was that for a long time great information ball thanks for sure you with the snow and he's an investor wants to doable on portfolio. Review. This is the kind of shut you too can count absolutely and and in fact what we're doing is is not just taking into account I mean outlaw all Don has given a summary of a few things that we're looking out but. I do think that the case is very compelling for overall what's gonna happen with the interest rates. And it's a big reason frankly why not only are we doing this but other. Our fixed income managers are doing this as well. We're holding some connection and were holding cash with the idea of buying in or what you know of the retailers like this latter ranks. But you have to patients to do that you can't just sit there and and buy something to answer while I guess I'm stuck with a aunt and that's not the approach that we're using or using smother approaches as well but we think really helped provide the best longer term income stream to our clients. Paul stole freedom berg and dvd 972752680. 8972. Plan or Gorman to plans strong dark comments in an email Paul welcome back. More business stories and smaller government data to share sparked strong financial form. This is tall Parsons president of planned strong investment management. And you're listening to them planned strong financial forum on WRKO. Boston's talk station. If you like what you hear on our show and what you need to take a look at your investments and retirement plan called my office. 80889727526. That's 888972. Plant. Securities and investment advisory services offered through an extra two groupings like number two and as I can see classroom investment management is an affiliate of this financial grouping is located in Washington street diplomats includes six. Hi this is on he Nelson if you're fifty or older here's a suggestion. Commit to getting your financial house in order over the years you worked hard took chances made sacrifices. And built up as much wealth as possible so you'd never run out of money in retirement. Well. Now it's time to get organized and to make sure you have a financial plan. Who protect your retirement. If your financial life together. Paul Paul Parsons had planned strong investment management a schedule financial checkup call 888. 9727526. That's 888972. Plan commit to getting your financial house in order call 888972. Plant or visit planned strong dot com. Securities and investment advisory services offered through next financial group each member tumor SIPC plans to investment management does not include an accident and his OK I need to Washington street Dedham mass. Says financial talking appeared signing and informative. At least is informative its plans on financial forum where bold portions president's bold plans stronger investment management. That I did Garber at the anchor desk along with the exciting hole Parsons Ari excite you know occasionally. Interesting information though you we've been getting some some constructive criticism has some very different stuff the civilians from just no market and that outlook is really something to pay attention to it. You know what I I really enjoy it listen to music colorful fellow men and I. You know but you when you think about the confluence of intensity was talking about it makes cents and I haven't had not heard any rules or not. Now solidly this good stuff Gerri good stuffed speaking of good stuff let's skip practice some of these news of the last week sharp the dollar the dollar remains strong cast weak against both the Euro and the yen the dollar traded between a dollar 500 dollar six per Euro. And right around 114 yen per US dollar actually weakened against the Mexican peso murmured strengthened last week actually down a little bit. But it's still up. And the dollar still significantly stronger against the Mexican peso then before I Donald Trump was elected president. Okay what about oil oil was half week who are yet that was probably the lead economic story of the week where the price of well actually went down below fifty dollars a barrel for a M for US crew okay. And we saw a drop about four dollars a barrel as rock 49 dollars a barrel for west Texas bought fifty to a barrel for Brent. And on the reason one of the reasons for that was it crude inventories in the US again went up and they were up about another eight million barrels on and right now pierce date dare up. About 7%. Higher. Then they weren't the same time last year and we're just not seeing us cut into that the bigger issue that's going on here is. While on OPEC is cutting their output and remember they were exposed to cut their output about one point six million barrels per day and some of the nonopec countries were also schools to cut their output. What oh what they came out and said this week was that. OPEC has lived up greatly to its part of the production cuts which by the way is not a sure it doesn't happen all too harsh but they said. Around 90% of the production cuts that OPEC was close to make. Have actually happened to be sent about 50% of the non OPEC producers cots have also happened. But here's what's happening on the other side the concern is that the US shale people. Are are coming back on to the market coming back into production. Faster than date hope that they would and that is increasing the supply of oil and decrease in the price and you know what you do is you run the risk. Of OPEC and specifically the saudis getting angry again and then sank all you wanna fight again OK we'll fight again. And will drop the price to wait now because our our breakeven price is a lot lower than yours the US shale or oil producers price. And so there is a concern out there. That a big US our show producers are coming back on line too fast. And it's gonna be interesting to see how this plays out I hope it doesn't break out into open war as it relates to price war. But I have to tell you this was not a good week really you know the price was down essentially 10% that's a very big move. Are they can be are gremlin because the price had hit a number could live with for exactly fifty bucks they could live with 5055. Even sixty dollars a barrel. Now you start to make money again for some of these shell producers they're saying let's bring it back on line. That's you know that's not what the saudis are looking for by trying to manipulate the price to sixty dollars that's point. One of the biggest stories we haven't addressed yet always the WikiLeaks dump of car almost 9000 document and you don't let me down or allegedly from the CIA I mean this is this is news ended in its interest and it's it's so little scary. Al what do we learn a mood to how did that affect market. Well not just the market put investors may mean you think about this thing it's so funny you use your news stories like we had the I think the two big stories this week work. The big week he leaks. Treasure trove of documents that I leaked out and the other one of course is the Affordable Care Act repeal and replace a let's talk about ball closer and and their impact. To investors. Let's talk first about the WikiLeaks. On WikiLeaks. On the the group. That stole the emails. That. Had the DNC's. Very embarrassing things the same thing and they they had another treasure true and this time it was up a treasure trove of documents from the CIA but said that the CIA actually knew the vulnerability. East. In a bunch of on and the products out there that they could use to do conduct clandestine. Tight surveillance where you perhaps some very scary star break right and and let me just give you an example. Of some of the things that that these WikiLeaks documents outline. One thing that they do was that was that they said the air worked tolls detail that extracted data. From a Microsoft Exchange database without the need for credentials and other where's it go win and do it before you you have to pass any kind of security. And there's also a program to hack Samsung's. Internet connected TV. And to turn it into Covert listening to seemed like my TV Blake might see you. And Kerry and all of a sudden now if that things connected to the Internet. Then the or the the New York which aren't his and yours are actually come bid documents that were released actually highlighted. How all these agencies could go win have to act. And listen in to what you're saying to your spouse and your living or if they so chose to jail. Okay there were also documents that showed how one could bypass the encryption. Of our of a watt sap which is he smokes are messaging system right not a very good news. And also they could collect audio and message traffic. From on other devices including any faults. So overall this is really. And an eye opening experience at all I can tell you what is. It's a very unsettling to apple and FaceBook and Microsoft and alphabet Kubel and Samsung because all of a sudden I hit it looks like. With this document leak. On what you know WikiLeaks has essentially opened the door to everyone in the world. On here that techniques at the CIA uses. I too want to spy on a friend or follow her and what it does so ultimately is that highlights their vulnerabilities in these products. And you know that can't be necessarily good for the sales of these products right. While that doesn't summary view from those companies all the cells like they have a little work to do techno of their security when you know what also might mean to caddie is don't forget. One thing that we talk about as a longer term trend as the whole concept of cyber security. And this is the definition of cyber security and he doesn't necessarily have to be over a telephone line or you know somebody using. A you know are another vehicle did dare showing he can use common. Vehicles that every one has in their home and crying phone IR Samsung TV we are now carry around with us the greatest spy device. Koran does have to turn it on and and so what it really lends itself to though is pain if there's a company out there or group of companies. That can put together great cyber security software. So that these odd that the providers whether it's apple or cooler Webber and their products can use to prevent this from happening what do market opportunity right so this isn't just a weakness for those companies I mentioned and potentially a a bit about a bad thing for them. It actually could be very good as it relates to a business opportunities for those companies that that excel. And specialize in cyber security that's one angle were certainly looking. Now ball the other big news story was as you mentioned indeed the GOP. Forwarding you're a repeal and replacement of the EC eight to put forward they said here it is. It got a lot of flak from from both sides of the aisle from other Republicans as well as Democrats. Humbly that we haven't seen much movement on yet this just came out what what's going on there and how might this affect investors well. First of all let me explain you what this thing includes 'cause. It as you know I think the original Affordable Care Act was almost 2000 pages long and and this thing they brag is a fraction of that size but it's still look like a pretty good sheaf of papers to me so. I just tried to bullet down boil down to five or six bullets and let me get him to you first of the penalty to individuals for not having health insurance will be eliminated and actually you know how those penalties were starting again there are getting bigger and bigger so while that penalties gone away. The way that they're getting people to buy insurance even if they don't. Need the coverage right now don't we pre existing conditions is insurers could impose a 30%. Price increase. On people who go uninsured for more than two months and then by copper true. So this is a way to save the insurance companies yeah you're right these people are flying with a preexisting condition. But and and they know what and are gaming the system but you can charge more if they have if that's truly the case it appears they're gaming system. And as I said pre existing conditions continue to be covered. On at and and at the same rates for all people it's not like you can on it charged more for somebody with preexisting conditions vs somebody would not. The second thing is it would repeal most of the health flaws taxes that's really important because for those higher urged. On there's a three point 8% tax on investment income and a point 9% tax on wages for families within com. I think it's individuals greater than 200000 box families are greater than 250000. Dollars of income here's the bad news it starts in 2018. And it only impacts about 21 half percent of the council's of course the two Democrats will view this as oh this just benefits the rich and that's true because the rich were the only ones paying this penalty in the first place cracks in the first okay. Another thing is it would not Alter the popular tax breaks on health plans that companies get employers get. But employer plans would have to offer preventative health benefits without our pocket charges. And they still have to cover children up through the age 26. So that's the same as it was before. And another thing is that people who don't get insurance through their employer. And be able to get refundable tax credit so it's a little bit different than the way they were doing that before. He get a refundable tax credit based on your agent your income and they range somewhere between. 2000 box. And 4000 bucks a year our whole family can't exceed 141000. Box and by the way those tax credits. Kind of get phased out as. Income levels approach 75000. Dollars for individuals 150000. Box for our family. Only combatants are a little bit more about this and then you've got an interest to serve a Warren Buffett I wanna hear as well when I returned to class strong financial form. This is tall Parsons president of planned strong investment management. And you're listening to the plan's strong financial forum on WRKO. Boston's talk stations. If you like what you hear on our show and what media take a look at your investments and retirement plan called my office of 80889727526. That's 888972. Plan. Securities and investment advisory services offered through metro metro group member to go as I can sequester investment management is an affiliate of this financial grouping is located in Washington street and Massachusetts. Hi this is Avi Nelson. People use different strategies to acquire enough money for retirement. Some try to do it themselves. Others buy insurance for investment products though sometimes will benefit the seller more than the buyer what makes sense is to hire an advisor with first rate credentials and why do investment management experience. Should have a fiduciary obligation to act in your best interest. And be paid the same amount no matter what your invested in if these things matter to you. Call Paul Parsons at planned strong investment management to learn more call 888. 9727526. Hiring the right advisor could be your best investment. That's 888972. Plan or vision plan strong dot com. Securities and investment advisory services offered through next financial group and member former SIPC plans to investment management is not an affiliate of next financial grouping and is located and I need to Washington street Dedham mass. Finally your really your show is not trying to sell you insurance for a new business. This is no plans strong financial forum where gold portions. President Roh plans strong investment. And I didn't cover the anchor desk along with all Parsons will be just remind you once again Paul still free number eight DD 9727526. If you're so invested the way you were a year ago. Paula strongly suggest Hugh McCall and he can that you know we're in how'd you may be leaving some money on the table numbers won't be doing that 888972. Plan. Or go to class strong dot com send an email. You sit down with Paul and his team go over your portfolio assume no obligation. Meeting takes about an hour or so and you could learn who the worse it could happen is you'll learn a lot. And you might just find out where you where some money is being left on the table as well. Elite 89727526. You know I'm like you brought that up and we had a very interest in case this week we're an individual came and lovely lady. And she I'm as I was talking her should worry here we talk a little but we're goals weren't so forth she just moved from another state and so it was time to find and would rise or. And an ice it's how is your performance that and should you know I really don't know the answer to that. I said oh okay well on let's say let's score line take a look at you're historical statements so we sat next to each other got on a computer terminal and took a look. And sure enough there were no performance numbers on any of her statements and I'm not a one passable bush fears of even anxious I have no idea. Principle let's dig through your mobile let's figure that out and obviously I know my way around all these sites at this point sure. You couldn't hear what the fees were really so all of that was completely. Opaque. And and as a result I. I actually east are sent to her all alt one and elsewhere I'll figure this out and let's get back together and let's talk about the results. I did that and what we found out was that she had underperformed. Offer the last four years by about 1% in Europe and which doesn't sound like a lot unless it's your money for an idea and on a 100000 dollars. 1% is a thousand dollars and so if you can give a thousand dollars away god bless you I can't afford to do that one person that's pretty important make. What she was doing what she was paying for example individual bonds. But that price that you was paying for the bond was significantly higher than a market price of the pot so you we could go in and look on the the bond central database and understand what the price of bonds went for that day for every single type of bond by Q sit by the actual kind of bond. We looked at that vs the price that was on her statement that she actually paid. About call it thirty dollars higher per thousand dollar potter screen percent higher. Dan what we would have expected it to be on that date based on the trading information that we act. So you know do this is frankly this is why there are some changes that are needed to our industry this is why we are few days to advise search and why everything we do is incredibly transparent where we say we're charging a 1% that's set. There are no hidden charges anywhere you're not gonna see it and what we buy a bond for vs what we what to what you actually buy it for. And as it relates to performance when we do performance reviews we show actual performance compared to a benchmark. That is the same risk level as a persons taking so and we do for multiple pure it's very very different experience. Yes and pop only mention that the the way that this woman was paying feast that that was all. Legal woes going on absolutely no funny business you know just a little as say OPEC is just slightly hidden very irritated me to okay. You know it wasn't even that. Oh yeah fees are deducted but they just don't show the line item in the statement wasn't that at all yeah I know this is you literally had to look at the mark up on the bond to figure out that that's where they were making no money. Right so let's certainly simply potion to you look at as well also gonna give cup Paula call. Bring some of Assam along with viewer bring Europe bring the web site and password exactly duel that. 8889727526. Is also for number. The chip also we're talking a bulb with the Republicans put forward as the era repeal replacement DC the Affordable Care Act. A bomb. We talked about the kind of the good the that a little bit but it was or anything else you mentioned to do some Medicaid issues are energy address as well. The whole thing here is. As you look at this part potential legislation. You know you have to look at which sectors we'd be in health care. Will do maybe benefit from this and which ones wouldn't do as well compared do you Affordable Care Act. And one of the concerns was what all happened with the ease with Medicaid funding because don't forget 31 states signed up. For programs that included increased Medicaid. A support okay right and what what the sting does is it essentially says were gonna we're not gonna get rid of that immediately. But we are gonna diminish that over the next several years so it looks like fewer people. Will get as much coverage through Medicaid as they thought they were. Okay my arm and you know. Part gathering as I mentioned was will there be other things tacked into this like the Elijah Cummings. Donald Trump conversation of will they negotiate for example will they finally make it legal for Medicaid. And Medicare to negotiate drug prices because if they do that's essentially setting drink drug price price price fixing it right. And that could materially impact big farm so. All I can see our two right now is that there are a number of parts of health care. That are watching this very closely and if you have investments in health care you should do it because. Whether it's pharma or Biotech. Medical equipment or hospital or insurance companies. All of them will be impacted by what this legislation dust. And we certainly are watching that very closely as it relates to where were emphasizing. Our health care. On waiting at this point and what we're underweighting at this point because are avoiding at this point because were concerned that any revision to dispel. Could materially impact that part of health care market. A poem read you a Storm Warren Buffett turned to vote changing his direction a little bit what are we learning from listing what it was still lying Nikkei an awesome it would old too old dog new is there an idea well insurers and although he is but he's a very wealthy. Did right. I'm he's been hyped it tearing up a bunch of his long held platitudes it's really quite funny. You know first he went out and eat eat Boston airline stocks remember that and that was after for years and years he said. The worst decision to permit through our non when he was a younger investors seen a sixty piece and was buying airline stocks and he actually bought I think three airline stocks relatively recently. And now as you know he's also the other place that when asked people would say why aren't you invested in technology he said. I don't under I can't invest in something I don't understand it well not only did he buy into apple. In Q4 but he actually upped the position. In this latest quarter as well. And he now holds about 21 half percent of total shares outstanding while of the largest company in the world apparently traded company in the world. That's what I call a meaningful position right now. Even though it's considered detect company Buffett actually considers it. Our consumer electronics got broken but if you think about why he decided to buy it and actually is a cute story it has to do with. I his grandchildren and he was with his grandchildren at a restaurant. And even realized. How march base how much time they spend whether it's on an I pattern iPhone and how their entire lives intertwined with that device. Any realized. That that is something you just can't ignore. And so he he thinks that that is our actually a very big reason why he. People should consider investing in Apple's shortly why he had asked again. I'm not recommending you buy or sell apple it is fascinating to hear that he finally has gone I should also say one other thing. Normal he doesn't announce when he suggested in a stock in the current quarter Bryant he waits till the quarter and any pass to announce a true reporting. But he did this time under the auspices of he thinks the price now has been bid up enough that he would no longer buying it at this price OK okay so that's why you feel comfortable talking about it at this point. Right now speaking of apple a rehearing little bits of whom an iPhone neat yeah. So this is again another reason why maybe Buffett jumped in on us and that's the idea that. Were not just a regular cycle but may be a super cycle as it relates to the iPhone product line. And the reason for that. Is because if you look first of all there are 715. Mill yen. I fall I don't care okay and 31%. Of us. Will be in use and will been on an upgraded for more than two years by the time the iPhone eight comes out. Thirty a third of a minute okay. And that is a higher usually about a quarter. Are at the time of whenever release comes out. OK so there's really thinking that there's some pent up demand dare for this thing by these. All with people and haven't replaced their phones haven't upgraded their phones and after two year period. And also changes to the look in the field may also drive a super cycle demand because you know they're talking about is this edge to edge class. Which he'd and that means no home button by the right and on the bottom of and I hadn't really thought about that's it's a week we talked about it a bit more and on all of those on upgraded phones don't get destroyed they don't get thrown out. People sell look. And they get re purpose and sold back into circulation. And what that could do is increase the overall supply. Of iphones out the error. And as a result. On it could lead to more Apple's services. And think you know the App Store shrew or those things being sold. So overall those are some of the reasons that our analysts are thinking why Buffett is especially buying into now and why Apple's actually at a very nice run you know over the last several months. And you know one of the things they do know is they sell cloud to everybody. So we eat they don't care if you're buying the phone third hand because. You're you're into that mostly cloud charged that they're gonna make sure things are taking up so much space. That even if you really are careful use up the phone up be any more prospects. And guess what you're also buying iTunes or buying everything else and everything costs something it's it's really quite something. The services business is becoming more and more big part of the apple business and you know what it's a very high margin business that's why apple likes. Also remember once again 88897275268. BB 972 planned call him for no obligation portfolio review. After our armed tell you use it with honesty and they'll tell you. Where you may be leading some money on the table. Hey Kenny just before we close one last thing keep your eye on the Dutch elections next week only that is going to be fascinating. It's likely that the populist won't win but if he doesn't forms a coalition government that's another big problem for Europe will talk about that next week LC and actually thanks for being here Paul had a great weekend Kenny it's a plan strong financial four. This is tall Parsons president of planned strong investment management. And you're listening to them planned strong financial forum on WRKO. Boston's talk station if you like what you hear on our show and what I mean to take a look at your investments and retirement plan called my office. 808897275260. That's 888972. Plant. Securities and investment advisory services offered through metro metro group member to go as I can sequester investment management is an affiliate of mismanagement ripping through Islam in his tiny Washington street and Massachusetts. Castro investment management is located at nine media Washington street Dedham mass or to go to six and to be reached at 889727526. 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