August 26, 2014
TDG News: The Dowling Group Supports STARelief
This past weekend was the 1st Doggy Day Palooza event to support STARelief and Pet Assistance, and it was a huge success! Over 150 people stopped by to show their support by offering donations at the dog wash, car wash, or lending a hand as a volunteer. Doggy Day Palooza raised $2,300 for STARelief and Pet Assistance. With a small portion of the funds raised, STARelief was already able to pay for a surgery on a dog. If you were unable to make the event but still want to donate to the organization, you can visit the STARelief website here.
Yellen Sees the Economy Improving
What do Harry S. Truman and Hindu goddesses have in common? Both were invoked to describe Federal Reserve Chairwoman Janet Yellen's speech at the Jackson Hole Economic Policy Symposium last week.
In her opening comments, Yellen confirmed the economy had improved and suggested more data was needed before the Fed could determine its path. She said:
"...our understanding of labor market developments and their potential implications for inflation will remain far from perfect. As a consequence, monetary policy ultimately must be conducted in a pragmatic manner that relies not on any particular indicator or model, but instead reflects an ongoing assessment of a wide range of information in the context of our ever-evolving understanding of the economy."
Afterward, some Wall Street professionals empathized with Truman, the 33rd President of the United States and a native of the 'Show Me' state, who once lamented the lack of resolute economic advice available. Truman pined for a 'one-handed economist' who wouldn't hedge by saying, "On the one hand... on the other hand..."
Barron's reported on the speech saying, "In discussing the labor market... Yellen introduced so many qualifications that, instead of the proverbial two-handed economist, she more resembled a Hindu goddess with a half-dozen or more appendages."
No matter what anyone made of Yellen's remarks, she was in the catbird seat compared to European Central Bank (ECB) President Mario Draghi who spoke after her. Unemployment in the Eurozone stands at 11.5 percent compared to 6.2 percent in the United States. The range of unemployment across the region is quite significant, from 5 percent in Germany to 25 percent in Spain.
Investors and analysts may not have received the insights they'd hoped to gain about U.S. monetary policy, but it's important to remember that one person's hedging may be another person's careful analysis.
|Data as of 8/22/14||1-Week||Y-T-D||1-Year||3-Year||5-Year||10-Year|
|Standard & Poor's 500 (Domestic Stocks)||1.7%||7.6%||20.0%||21.0%||14.2%||6.1%|
|10-year Treasury Note (Yield Only)||2.4||NA||2.9||2.1||3.5||4.3|
|Gold (per ounce)||-1.5||6.3||-7.1||-12.1||6.1||12.0|
|Bloomberg Commodity Index||-0.2||-0.3||-2.8||-7.8||-0.5||-1.6|
|DJ Equity All REIT Total Return Index||0.8||19.6||22.6||17.7||19.0||9.4|
S&P 500, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT Total Return Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, Barron's, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
Review Your Estate Plans
Mind the gap. Here in America, some of the most important gaps that need to be filled are in estate plans. It's not enough to have a plan. You also need to make sure all of the components of your plan - from retirement accounts to investments to property - are properly coordinated. Often the gaps in estate plans are related to:
- Beneficiary designations: Many financial assets - such as bank accounts, life insurance policies, brokerage accounts, annuities, and retirement accounts - give you the opportunity to name a beneficiary. Typically, assets pass directly to the named beneficiary regardless of instructions in a will. Consequently, it's important to review beneficiary designations and make sure they align with the intent of your estate plan.
It's also important to know the rules guiding investment distributions to beneficiaries. Generally, there are two possibilities:
o Per stirpes distribution indicates if a beneficiary dies before the account owner does, the beneficiary's share will go to his or her heirs.
o Per capita distribution indicates each beneficiary receives the same amount. If a beneficiary predeceases the account owner, his or her share goes to the other named beneficiaries.
- Joint ownership of assets: While joint ownership is common for spouses, joint ownership with children and other relatives has the potential to create some estate planning headaches. Forbes.com suggests estate plans should include "a will, revocable living trust (for most people), and financial and health care powers of attorney - which can accomplish all of the same goals as joint ownership, without the risks and complications."
A 2013 survey of wealthy investors found nearly 72 percent of participants did not have complete estate plans. If you feel you fall into this category, you may want to schedule a meeting with the Dowling Group to assess your estate tax liability, determine your most important goals, and structure a plan that fits your needs. Once in place, you may want to review your estate plan regularly to ensure it is in line with current laws and regulations and that it still expresses your goals.
Weekly Focus - Think About It
"No matter what people tell you, words and ideas can change the world."
—Robin Williams, actor and comedian
Sean M. Dowling, CFP, EA
President, The Dowling Group Wealth Management
- The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
- Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
- Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
- The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
- Gold represents the London afternoon gold price fix as reported by the London Bullion Market Association.
- The DJ Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
- The DJ Equity All REIT TR Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
- Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
- Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
- Past performance does not guarantee future results.
- You cannot invest directly in an index.
- The S&P 500 is an unmanaged index. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.
- Consult your financial professional before making any investment decision.
- This newsletter was prepared by Peak Advisor Alliance. Peak Advisor Alliance is not affiliated with the named broker/dealer.
- Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
- Stock investing involves risk including loss of principal.
http://online.barrons.com/news/articles/SB50001424127887324616904580108413799206170?mod=BOL_hp_we_columns (or go to http://peakclassic.peakadvisoralliance.com/app/webroot/custom/editor/08-25-14_Barrons-The_Feds_Evenhanded_Policy-Footnote_4.pdf)
http://www.ustrust.com/publish/content/application/pdf/GWMOL/UST-Highlights-Brochure-Insights-on-Wealth-and-Worth-2013.pdf (Page 8) (or go to http://peakclassic.peakadvisoralliance.com/app/webroot/custom/editor/08-25-14_US_Trust-2013_US_Trust_Insights_on_Wealth_and_Worth-Footnote_10.pdf)
IRS Circular 230 Disclosure: Pursuant to requirements imposed by the Internal Revenue Service, any tax advice contained in this communication (including any attachments) is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code or promoting, marketing or recommending to another person any tax-related matter. Please contact us if you wish to have formal written advice on this matter.
ADV & Investment Objectives: Please contact The Dowling Group if there are any changes in your financial situation or investment objectives, or if you wish to impose, add or modify any reasonable restrictions to the management of your account. Our current disclosure statement is set forth on Part II of Form ADV and is available for your review upon request.
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