Access my Accounts

Market Viewpoints

by Keith Bonjour, Portfolio Manager

Stocks had another strong quarter to finish the halfway point of the year, however it was a rather volatile ride with April and June showing strong monthly returns and May seeing a stock pullback of over five percent. The majority of the volatility continued to come from the ongoing trade conflict with China and the market trying to price in expectations of what the Federal Reserve’s next steps will be.

U.S. stocks continue to be the leading performers to start the year; however, both developed international and emerging markets are showing strong returns as well. Treasury yields have also continued to fall this year and bond prices, which move in opposite direction as bond yields, have shown steady returns. All major asset classes finished the first half of the year in positive territory after a challenging year in 2018.

The Federal Reserve projections and commentary continue to be on the mind of investors this year. The market is now predicting several interest rate cuts from the Fed before the end of 2019. This is a far cry from last year’s Fed predictions of three rate increases for 2019. With global growth softening and many other developing nations keeping their interest rates extremely low, the Fed is facing pressure to cut interest rates to help prolong the current expansion. The Fed has signaled that they wish to remain cautious and not overreact to short term data, however many Federal Reserve members are indicating a likelihood that the Fed could make their first interest rate cut as soon as the next Fed meeting which takes place at the end of July.

In the first quarter, it looked like the U.S. and China were moving closer towards an agreement on trade. However, these negotiations fell apart during the second quarter causing a strong market selloff in May. The U.S. accused China of backing out of prior commitments that had been agreed upon in earlier negotiations. For its part, China has accused the U.S. of continuing to change its demands. Both sides appear reluctant to offer any major concessions in the trade discussions. However, both China and the U.S. have agreed to a trade truce following President Trump and President Xi’s meeting on the sideline of the G-20 summit in Japan. For the moment, it appears both sides have agreed not to escalate any further threats. The existing tariffs will remain in place as negotiations restart between both countries.

The global economy appears to have slowed over the last quarter as tariffs begin to weigh on corporations and their decision-making. It appears that the trade conflict will continue for some time with neither side in a hurry to end the standoff. This will continue to be a drag on both the U.S. and international economies as businesses become more cautious in a more uncertain environment. However, expectations for lower interest rates both in the U.S. and abroad should soften the drag and support risk assets. We continue to recommend a more neutral stance on equities with a focus on higher quality companies with strong balance sheets while maintaining the proper liquidity and duration in our bond portfolios. We also recommend a more long-term focus on investment goals and objectives, and not reacting to short term up or down movements in the market.


In the Community: Our Non-Profit Community Spotlight

The Handicapped Development Center

Ridgecrest Village has been a proud provider of senior services for the Quad Cites for over 50 years! As the leader in retirement communities, Ridgecrest Village has flourished over the years. We look forward to continuing to support our residents and staff to live purposefully and passionately.

We also want our residents to live their lives as worry free as possible. Our unique option of Lifecare offers our residents peace of mind when it comes to the future costs of their potential healthcare needs. When residents choose this option, they are able to control those costs and this can allow them to preserve their assets for their family.

Ridgecrest Village is driven not only by our mission and values, but also has the help of trusted partners. Similar to how we become this partner with residents and their families as they plan for their future, Ridgecrest Village looks to the Investment Management Group to guide us. IMG brings a lot of value to our organization by providing solid advice and performance that is beneficial to our operation, whereby providing a better living community for our residents.

Another of our trusted partners is our own Ridgecrest Village Foundation. With the help of the foundation’s work, we are able to sustain some valuable programs. One plan includes a nursing scholarship program to help individuals cover the costs as they further their education. Another program is our Koning Charitable Fund. This fund can provide resources for those that have been living at Ridgecrest over the years and find they may need financial assistance. This is just one more example of how we try to give our residents peace of mind.

Ridgecrest Village truly is a village of its own. We provide all levels of care from Independent Living to Assisted Living to 24 hour care to end of life care. You can find it all right here in one place. For more information about Ridgecrest Village call 563.391.3430 and ask for Karen McCoy. We hope to see you soon and to be able to say “Welcome Home!"


When to Start Long-Term Care Planning

by Patrick Olsen, Special Care Planner, Financial Services Professional

The need for long term care may happen to anyone and at any time. It could be you or someone close to you. The need for long term care may result from being chronically ill, from a severe cognitive impairment or something as unexpected as an accident or injury.

The time to create a plan in case you need long term care is now, while you are healthy. The earlier you begin planning, the more options you may have to continue living life on your terms.

Should a serious illness, an accident or injury cause you to need assistance with your daily activities, or should you have a severe cognitive impairment, a plan can help you prepare to receive the care you want – in the setting you choose. It can also help protect your assets, retirement funds, and your estate from being depleted to provide care. Not everyone knows some of the basic information about long term care – so before you start planning, get the answers to some common questions. The plans you make today could impact your future lifestyle, and the quality of life you experience.

Give me a call to learn more about long term care planning.
 

A New Strategy for my IRA RMD

With retirement comes limited funds and you want to make sure that your money is working for you instead of against you. With the new tax laws in place, most individuals are now taking the larger standard deduction and believe that charitable contributions are no longer deductible. This is incorrect, charitable contributions are deductible; you just don’t see them because individuals are not itemizing.

One way around this, and to reduce your gross income, is to make a charitable contribution directly from your retirement account. This also helps satisfy your yearly required distribution. A few things to keep in mind:
- You must be 70 ½ in order to make the contribution
- Your financial institution has to send the check to the charity
- Contributions cannot be made from a 401k

You will need to inform your tax accountant that the contribution was made The 1099-R form you receive at the end of the year will not reflect the contribution. This reduces the amount of income that is taxable and determines how much of your social security is taxable. It is win-win for both you and the charity. Happy Giving!

Contact Amy directly at 563.514.5522.



Investment Products
• Are not insured by the FDIC or any other federal government agency
• Are not deposits of or guaranteed by the bank or any bank affiliate
• May lose value