The Ridgewood Blog Brings a Free Market Laissez-faire Point of View to Local, New Jersey State and National Issues.
the staff of the Ridgewood blog
Omaha, Nebraska , our friend Prince Dykes of the Investors Show wanted to share a recap while he makes the rounds at his first experience at a Berkshire Hathaway Annual Meeting . Hopefully you enjoy the footage as much as we did.
November 8,2016
the staff of the Ridgewood blog
Ridgewood NJ, With the presidential election dominating the news cycles, many investors may be keeping an eye on the stock market as well as the voting booth as they wonder what impact the election of Hillary Clinton or Donald Trump could have on their portfolios.
“Presidential elections are almost always a big part of the greater theme of markets, but in this case even more so,” says Benjamin Lupu, a Certified Financial Planner and founder of Kensington AMI (www.KensingtonAMI.com), an asset-management firm.
Lupu says it’s important to understand that how voters weigh their Election Day choices and how the market views the candidates aren’t necessarily the same thing.
As hard as it might be, he says, investors should lay aside any personal political leanings as they assess what factors might keep the market humming and what factors might upset the market – and affect their investments in the process.
“From an investment standpoint, this isn’t about being for one candidate or the other,” Lupu says. “It’s a matter of trying to gauge what the markets might do depending on different scenarios, and trying to plan and respond accordingly.”
He says factors to consider include:
• The Clinton impact. What ever opinion people may have of Clinton, she represents status quo, continuity and predictability, which markets prefer, Lupu says. Markets in general have been buoyant in recent months as a decisive win for Clinton had been the consensus expectation and has been priced into the markets. Those expectations could change quickly, though, and investors would need to consider adjustments if they do. “Harsh reality may have something to say about this before the process is over, and any reversal in the polls can greatly upset markets,” he says.
• The Trump impact. Trump is extremely popular with his populist base in the U.S., and some people would consider a Trump victory good for business. The wild card, though, is that he’s immensely unpopular in much of the rest of the world, Lupu says. If the race is seen as close, or if Trump is considered to have a strong chance of winning, global markets could react negatively, at least initially. If the odds of a Trump win appear to be improving, it might be a good idea for investors to reduce exposure, stay partially in cash and see what transpires, Lupu says.
• A general approach. Financial security in the U.S. has traditionally come from three things: sound, long-term process; clear, unemotional thinking; and American optimism, Lupu says. “I like to say keep it clean, be disciplined and have faith in the future,” he says. In this case, that means be aware of market expectations, follow what happens, but stay focused and make prudent decisions based on facts and not emotions – or personal political preferences.
In any other presidential election year, Lupu says, he wouldn’t advocate keeping such a close watch on who’s ahead in the polls and the implications behind the poll numbers. But Clinton vs. Trump is far from the typical race.
“I admit this is not the usual playbook for election years,” Lupu says. “But then, this election is not the usual affair.”
About Benjamin Lupu
Benjamin Lupu, a Certified Financial Planner, is founder of Kensington AMI (www.KensingtonAMI.com), an asset-management firm in California. He has 36 years experience as an investment advisor, and his primary expertise is dividend and income investment and total return methodology.
October 11,2016
the staff of the Ridgewood blog
Ridgewood NJ, With the presidential election dominating the news cycles, many investors may be keeping an eye on the stock market as well as the voting booth as they wonder what impact the election of Hillary Clinton or Donald Trump could have on their portfolios.
“Presidential elections are almost always a big part of the greater theme of markets, but in this case even more so,” says Benjamin Lupu, a Certified Financial Planner and founder of Kensington AMI (www.KensingtonAMI.com), an asset-management firm.
Lupu says it’s important to understand that how voters weigh their Election Day choices and how the market views the candidates aren’t necessarily the same thing.
As hard as it might be, he says, investors should lay aside any personal political leanings as they assess what factors might keep the market humming and what factors might upset the market – and affect their investments in the process.
“From an investment standpoint, this isn’t about being for one candidate or the other,” Lupu says. “It’s a matter of trying to gauge what the markets might do depending on different scenarios, and trying to plan and respond accordingly.”
He says factors to consider include:
• The Clinton impact. What ever opinion people may have of Clinton, she represents status quo, continuity and predictability, which markets prefer, Lupu says. Markets in general have been buoyant in recent months as a decisive win for Clinton had been the consensus expectation and has been priced into the markets. Those expectations could change quickly, though, and investors would need to consider adjustments if they do. “Harsh reality may have something to say about this before the process is over, and any reversal in the polls can greatly upset markets,” he says.
• The Trump impact. Trump is extremely popular with his populist base in the U.S., and some people would consider a Trump victory good for business. The wild card, though, is that he’s immensely unpopular in much of the rest of the world, Lupu says. If the race is seen as close, or if Trump is considered to have a strong chance of winning, global markets could react negatively, at least initially. If the odds of a Trump win appear to be improving, it might be a good idea for investors to reduce exposure, stay partially in cash and see what transpires, Lupu says.
• A general approach. Financial security in the U.S. has traditionally come from three things: sound, long-term process; clear, unemotional thinking; and American optimism, Lupu says. “I like to say keep it clean, be disciplined and have faith in the future,” he says. In this case, that means be aware of market expectations, follow what happens, but stay focused and make prudent decisions based on facts and not emotions – or personal political preferences.
In any other presidential election year, Lupu says, he wouldn’t advocate keeping such a close watch on who’s ahead in the polls and the implications behind the poll numbers. But Clinton vs. Trump is far from the typical race.
“I admit this is not the usual playbook for election years,” Lupu says. “But then, this election is not the usual affair.”
About Benjamin Lupu
Benjamin Lupu, a Certified Financial Planner, is founder of Kensington AMI (www.KensingtonAMI.com), an asset-management firm in California. He has 36 years experience as an investment advisor, and his primary expertise is dividend and income investment and total return methodology.
April 19,2016
the staff of the Ridgewood blog
Ridgewood NJ Many people looking for good investments or hoping to save for retirement are wary of the very financial professionals who can help them reach their goals.
That was illustrated once again recently by the 2016 Harris Poll Reputation Quotient Report, which showed that just 37 percent of people surveyed believe the financial-services industry has a solid reputation.
The good news is that’s an improvement from past surveys. The bad news is that the pharmaceutical industry, the tobacco industry and government are the only ones with worse reputations.
Skepticism about the profession may sting a little, but there’s nothing wrong with caution when shopping for a financial professional, says Lou Desepoli, president of Desepoli Wealth Management (www.desepoliwealth.com).
“It’s important for investors to do their homework,” Desepoli says. “Don’t be timid about asking questions. A financial professional should answer any questions you have, and they should be able to provide details about fees, fiduciary standards and a client bill of rights.”
Mike Desepoli, Lou’s son and a wealth adviser at Desepoli Wealth Management, says all financial professionals may work with the same market conditions, but that doesn’t mean they are all created equal.
“How they assess, evaluate and react to the market is what sets one adviser apart from another,” he says.
The Desepolis say just a few of the topics an investor should broach when looking for an adviser include:
Ask how they are paid for the investments they recommend. Are they paid commissions on investments or other products they sell? Do they receive payments from mutual funds or investment companies they recommend? “What you’re trying to determine is whether they push investments that are more beneficial to them than they are to you,” Mike Desepoli says. “It’s best if the firm just charges a fee based on the value of the assets they manage for you. That makes it in their best interest for your portfolio to grow.”
Find out what safeguards they have in place to protect against fraud. Have they ever been disciplined for unlawful or unethical actions? How do they ensure the firm remains in compliance with legal and regulatory statutes?
The products an adviser can sell and the investment advice they can give are tied to their credentials. So find out what licenses and certifications they have.
“Most people spend more time shopping for a car than they do a financial adviser,” Lou Desepoli says. “But you want to be an informed consumer when it comes to who will handle your life savings. That person’s investment philosophy, their client-service philosophy and how they communicate with clients are all topics worth asking about.”
About Lou Desepoli
Lou Desepoli is the president and founder of Desepoli Wealth Management (www.desepoliwealth.com). He has more than 30 years’ experience in investment management, financial planning and tax consulting. He is also a CPA.
About Mike Desepoli
As a wealth adviser for Desepoli Wealth Management, Mike Desepoli serves as a wealth management resource to business owners and executives, assisting them in making proactive, personal financial decisions.
Rep Scott Garrett promoting North Jersey Business
Rep Scott Garrett on Department of Labor’s Fiduciary Rule: Another roadblock between people and their financial goals
Apr 6, 2016
the staff of the Ridgewood blog
Ridgewood NJ, Rep. Scott Garrett (NJ-05), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, issued the following statement after the Department of Labor (DOL) announced their finalized rule for retirement advisors—known as the “fiduciary rule”—that could turn retirement planning into an unaffordable luxury. The hyper-partisan rule was unveiled at the liberal think tank, the Center for American Progress, with a group of Democrat lawmakers.
“Saving for the future shouldn’t be a privilege for the wealthy, and Washington doesn’t need to put another roadblock between people and their financial goals. By ignoring the advice of the SEC and Congress, the DOL’s rule will increase the cost of retirement advice for lower- and middle-income Americans while creating a preferred class of rich investors. I will continue to fight for everyone’s right to get good financial advice because—unlike this administration—I believe in the people of New Jersey to make the best choices for their families and their futures.”
The DOL fiduciary rule could result in many people finding out that their accounts are too small to qualify for professional advice because providers will be forced to only service large accounts. In many cases, minimum account balances will increase substantially, effectively shutting down the ability of average investors to receive advice. It could also limit access to financial products that people are able to utilize when developing a retirement savings portfolio.
In October, Congressman Garrett voted for H.R. 1090, the Retail Investor Protection Act, which would block the DOL’s rule and ask for advice and expertise from the Securities and Exchange Commission before implementing any new rules.
Oct 27, 2015
the staff of the Ridgewood blog
WASHINGTON, D.C. – Rep. Scott Garrett (NJ-05) Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, issued the following statement after voting for H.R. 1090, the Retail Investor Protection Act:
Rep. Garrett speaks in support of the Retail Investor Protection Act
and the retirement savings of hard working New Jersey families on the House Floor.
“Today the House stood up for New Jersey families who are scraping and saving their hard-earned money to have a comfortable retirement by giving them the ability to make investment choices that are right for them. If the Department of Labor (DoL) rule goes forward, access to good financial advice will become a privilege enjoyed only by the wealthy. The Retail Investor Protection Act will ensure that the DoL’s proposed rule won’t inflict even more damage on middle and lower income Americans who are seeking guidance from a financial professional about their retirement savings.”
Background:
The DoL’s proposed rule changes to The Employee Retirement Income Security Act of 1974 (ERISA) could limit the access of middle and lower income Americans to retirement planning and investment guidance. Because of the heightened liability for providers contained in the rule, account minimums will rise – in some cases to as high as $100,000 – leaving millions of Americans without access to their financial advisor. The Retail Investor Protection Act would prohibit the Secretary of Labor from issuing any regulation that would define when an individual would be considered a fiduciary until 60 days after the Securities and Exchange Commission (SEC) issues a final rule which would govern standards of conduct for dealers and brokers under the Dodd-Frank Act.
Angela Rachidi
Poverty Studies, Society and Culture
President Obama spoke last week as part of a panel about poverty and opportunity at the Catholic-Evangelical Leadership Summit on Overcoming Poverty. He was joined by Robert Putnam, author of “Our Kids,” and AEI President Arthur Brooks. The president spoke at length about his belief that, as a country, we need to invest in those who have not had opportunities. He said (emphasis mine):
A free market is perfectly compatible with us making investment in good public schools, public universities; investments in public parks; investments in a whole bunch — public infrastructure that grows our economy and spreads it around. But that’s, in part, what’s been under attack for the last 30 years. And so, in some ways, rather than soften the edges of the market, we’ve turbocharged it. And we have not been willing, I think, to make some of those common investments so that everybody can play a part in getting opportunity.
Later, the president went further in suggesting that our country’s investments in poor people have declined:
And right now, they [poor kids] don’t have those things [mentors, social networks, decent books and computers and so forth], and those things have been stripped away. You look at state budgets, you look at city budgets, and you look at federal budgets, and we don’t make those same common investments that we used to. And it’s had an impact. And we shouldn’t pretend that somehow we have been making those same investments. We haven’t been. And there’s been a very specific ideological push not to make those investments. That’s where the argument comes in.
It’s difficult to find the areas of disinvestment that the president is referring to. A 2014 report by the Cato Institute analyzed education spending trends by state and found that spending per student for K-12 education increased almost 200% from 1970-2010, in constant dollars.
Spending on poor families has also increased dramatically over the past few decades. The figure above shows spending in constant dollars on the four largest means-tested programs (excluding public health insurance programs). Food and nutrition assistance alone increased 78% since FY2005. And Medicaid spending far overshadows other means-tested programs at $276 billion in FY2014, an increase of 40% since FY2005. As a percent of GDP, federal spending on means-tested programs was 3.5% in FY 2014. It was 2.7% in FY2005 and 2.4% in FY2001, the last recession.
In response to President Obama’s comments, Arthur Brooks, President of AEI, talked about declaring peace on the social safety net and tackling middle-class entitlements, but appropriately argued for limits. He said:
So if you join me in believing the safety net is a fundamental, moral right, and it’s a privilege of our society to provide, you must avoid austerity and you must avoid insolvency. And the only way that you can do that is with smart policies.
And I’m 100 percent sure the president agrees with me about smart macro-economic public policies, so I’m not caricaturing his views either.
Since we believe that there should be public goods, then we’re really talking about the system that provides them and provides them efficiently.
Given what the data show on the substantial public investments that already exist, it seems appropriate to have a conversation on efficiently targeting them rather than discussing how to increase them even more.
Scott Garrett Hosts Bipartisan Group of Business Leaders and members of Congress on the Fourth Anniversary of Dodd-Frank
July 28,2014
WASHINGTON, D.C. – On the Fourth Anniversary of Dodd-Frank Rep. Scott Garrett hosted three roundtable discussions with a bipartisan group of Members of Congress and key financial services leaders and CEOs. The purpose of our talks was simple: protect your retirement investments and ensure that all Americans can continue to invest in great businesses and ideas. The panelists offered their insights and the discussion was lively .
Rep. Scott Garrett (R-NJ), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises,had previously issued the following statement to mark the four year anniversary of the Dodd-Frank Act:
“It’s been four years since President Obama signed Dodd-Frank into law and our economy’s anemic growth since that time is just one example of why it is ineffective. In addition to holding back the economy, Dodd-Frank also puts unsuspecting American taxpayers on the hook for endless Wall Street bailouts. The sad news is that the consequences of this heavy-handed law continue to creep into every U.S. industry. Now more than ever, we need solutions that address the real issues behind the 2008 financial collapse, protect taxpayers, and ensure that the U.S. continues to have the most robust capital markets in the world.”
these heavy hitters are listed as attendees:
Fred Tomczyk, president and chief executive officer of TD Ameritrade
Robert Greifeld, CEO, NASDAQ OMX;
Joe Ratterman, CEO, BATS Global Markets;
Jeffrey Sprecher, CEO, Intercontinental Exchange (ICE);
Bryan Durkin, CEO, CME Group;
Edward T. Tilly, CEO, Chicago Board Options Exchange;
Matt Andresen, co-CEO, Headlands Technologies;
Daniel B. Coleman, CEO, Knight Capital Group;
Adam Nunes, president, Hudson River Trading;
Jamil Nazarali, head of Citadel Executions Services, Citadel Securities;
Doug Cifu, CEO, Virtu Financial;
Jamie Selway, managing director and head of electronic brokerage and sales, ITG;
Joseph Gawronski, president and COO, Rosenblatt Securities;
Brett Redfearn, head of market structure strategy, Americas, JPMorgan Chase Securities;
Jim Toes, president and CEO, Security Traders Association;
Kenneth Bentsen Jr., CEO, Securities Industry and Financial Markets Association (SIFMA);
Bill Baxter, head of global program trading and market structure, Fidelity Management and Research, on behalf of the Investment Company Institute (ICI); and
Patrick Hickey, head of market structure, Optiver, on behalf of the FIA Principal Traders Group.
list provided by CNBC’s Bob Pisani https://www.cnbc.com/id/101871271
