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Inflation Shock

Hello, and welcome to our Market Alert Video for today, which is August 25, 2023. Thank you for watching, I want to report to you that I did something that I thought I would regret. And it actually turned out to be fantastic. Just got back from Colorado. And while I was there, my wife talked me into taking a hike up to what is called Cathedral Lake. So you start at 10,000 feet, you climb to 12,000 feet, and you do it over the course of three and a half miles. So it’s actually seven miles, if you go all the way there and come all the way back. And I can find anything, I’ve been playing tennis for 58 years, I can climb stuff, it’s the going back down that I was really worried about. Because for those of you who have athlete knees, you know what I’m talking about going downstairs is harder than going up them, and so the whole time I was thinking, oh my gosh, oh my God, have I gone too far, I’m not going to be able to make it down. And so the 3.6 miles on the way back down, were challenging to say the least. I thought the next day that I wouldn’t be able to walk that I’d have all kinds of pain. But amazingly, all my knee pain went away my lower back to everything. It’s like I felt like it’s this is a magic bullet. So I’m going to start going on more hikes is all I can tell you are going downhill. Anyway, I’ve been dreading that thinking that’s crazy. But so it turns out not to be.
Anyway, let’s talk about something more pertinent to this video, which is Chairman Powell, the Federal Reserve Chairman came out today. And he gave his speech in Jackson Hole, and basically said, Well, we’ve been saying for several months now, and that is that the likelihood that we’re gonna see interest rates go down this year is very, very small. Actually, the chances of it going back up or interest rates rising from here are more likely than that they will go down from here. And he said that they are going to defeat inflation. And they will keep working at it until they do so. And he said it in no uncertain terms. So what does that mean? It means, as we said, we think inflation is going to start rising back up again, from its low that we saw in June, we think it’ll actually trend back up towards 4%, from the 3% that it hit. And therefore mission is not accomplished, as we said last week, and the Feds job is not done. This realization, we’ve branded it, inflation shock, because apparently, a lot of investors thought it’s over Feds gonna be lowering interest rates this year. And we saw a big rally in the market because of that notion. Now that that’s being taken away, the correction that we said would happen, apparently is happening. And the market is now down about 6% from its peak, and we said it could go 5% to 10%. So we’re in that range. What does it mean going forward? Well, we still believe that this is going to pass, it’ll get digested. There are a lot of people that are going to invest as seeing this as a buying opportunity. They’re just waiting for the moment. And we think by the end of this year, we’ll be higher than where we are today.
So the news is not good in the short run. But we think over the course of the year, the rest of this year, it should be fine. So but we could be wrong. Of course, we don’t have a crystal ball, as you know. But if we are wrong, we have our Invest & Protect Strategy ready to be implemented. And we will get out if we need to. But we are far from that right now. We don’t see the need for it.
So we hope that you have peace of mind, we are so grateful that you have chosen us to be your retirement planner. And for those of you who are now SCWPerS. Those of you who are now retired and enjoying your second childhood without parental supervision. Congrats. We love having as many SCWPerS as possible. And congratulations and those of you who are working on becoming a SCWPer, we’re here for that. We love it. It’s our it’s our passion. It’s our noble purpose. We want to get you retired and off and join that second childhood as soon as we possibly can.
So right now the news is not good, but we think it’ll be short lived and by the end of this year, we should be okay. I hope you’re well share this video with as many people as you’d like. Recommend us to your friends and your business associates, your neighbors. Anybody that you had is about to retire is retired recommend us to them. We’d be glad to help them if we can. Alright, so thanks for watching this video and we’ll talk soon!

Please note: transcript has been modified after the time of recording. 

Economic indicators and stock market performance cannot be predicted. Opinions expressed regarding the economy and the stock market belong solely to Ken Moraif on behalf of Retirement Planners of America and may not accurately portray actual future performance of the economy or stock market outcomes. Opinions expressed in this video is intended to be for informational purposes only and is not intended to be used as investment advice for individuals who are not clients of Retirement Planners of America. All content provided is the opinion of Ken Moraif, CEO and Founder of MMWKM Advisors LLC (d/b/a Retirement Planners of America). ©Copyright 2023