Last Sunday the headline suggested that banks were breaking in the U.S. And as J.P. Morgan chief economist Michael Feroli said this week: “There’s an old saying: Whenever the Fed hits the brakes, someone goes through the windshield.” There was more windshield hitting as the week progressed. And as was suggested in the Globe & Mail, it’s still unclear how many other companies and financial institutions didn’t have their seat belts on. We’re hitting the windshield on the Sunday Reads.
Here’s the post from last week – U.S. banks are breaking. The stress then moved overseas to a massive Swiss bank, Credit Suisse. The U.S. banks were “bailed out”, and now …
The regional banks are massive in the U.S., government agencies had to quickly restore confidence to the sector.
We’ll keep an eye on any further contagion (seatbelt checks). The consensus appears to be that this will be contained, but ya never know.
And be careful of what you ask for
The stock markets had previously been rallying in the hopes of a Fed pivot. But the market decline usually comes after the pivot (rate cuts).
Of course, we don’t know when the Fed will change course. And we don’t know what level of correction we might get after that event. Remember, lower prices are good for accumulators. Be mentally prepared for any market stress and invest on a regular schedule. If you’re sitting on cash, develop a plan to invest on a regular schedule.
Retirees need to protect their assets from serious stress, while the portfolio delivers enough growth over time. This week I offered – using defensive sector ETFs for the Canadian retirement portfolio.
Making sense of a crazy week …
This caught my eye this week. And it is a truth I have repeated often. Of course money can buy personal and family security, and happiness, to a point.
I also like this …
And check out this incredible savings rate. That’s how you do it …
You don’t have to go that “extreme” but spending way less than you make is a key to wealth creation. I had a few years with a 50% savings rate and then was able to put it all on cruise control.
Here’s my personal finance book, well it’s a 1000 word blog. Yes the wealth building basics are that simple, it doesn’t take a book. And you probably don’t need to pay an advisor every trading day. Keep and build your wealth in your pocket, where it belongs.
More Sunday Reads
On My Own Advisor Mark asks ‘how much do folks have saved for retirement?‘
The sum of the average Canadian retirement savings in 2018 was roughly around $184,000.
Some 19% of respondents had less than $50,000, and 30% had no retirement savings.
In the age group approaching retirement (45-64), 32% had nothing put aside. This cohort’s average savings were $345,000, while 49% had less than $250,000 in their accounts.”
Those with modest savings (that’s the norm) will have to get the most out of their portfolio and pensions, private and government. That means keeping your investment fees as low as possible. We can do that buy way of ETF portfolios and stock portfolios. You will need to know the most optimal order of account type harvesting and pension and OAS “accessing” as well. You can check in with Mark at Cashflows & Portfolios for that plan (for a reasonable fee).
Stocktrades.ca had offered a post that looked at the average net worth of Canadians by age category.
On Findependence Hub, a theme and investment truth that I am pleased to see repeated – healthcare stocks promise maximum gains with least amount of risk.
Here is the week in review on Dividend Hawk.
On FiPhysician a very good look at risk tolerance and asset allocation. We MUST invest within our risk tolerance level. If we don’t we might be joining the regional banks hitting that windscreen.
Porfolio updates
Rob at Passive Canadian Income has his portfolio update for February. And happy belated 40th birthday to Rob.
And last but not least, Bob at Tawcan describes 3 things than make him pull his hair out. Such as hearing …
“I don’t want a raise just to get taxed more.” 🙂
Thanks for reading. Don’t forget to follow this blog. It’s free. Use the Contact Form to reach out. Have a great Sunday and a wonderful week.
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“ as J.P. Morgan chief economist Michael Feroli said this week: “There’s an old saying: Whenever the Fed hits the brakes, someone goes through the windshield.” ”
I love that quote. I read that earlier this week as well.
Sometimes those that are old enough to have seen this happen once or twice should be listened to.
Buckle up your seat belt. It could be one heck of a ride.
See you next week.
Ya, that’s a good one.
Be prepared indeed.
Awareness is preparedness.